APAC IPOs & Placements, Aequitas Research

Ethan Aw

APAC IPOs & Placements

IPOs and Placements coverage across Asia Pacific

Aequitas Research

We cover all listing across the Asia Pacific along with follow-up placements. As of Dec 2020, our team had covered 539 IPOs with a hit rate of 73.5% and 685 placements with a hit rate of 66.8%.

We combine fundamental bottom-up views with our proprietary quantitative framework to provide a holistic coverage across new listings and placements. Our coverage includes pre-IPO notes before the deal is launched, follow-up analysis once the deal is live and post-listing trading analysis as well.

Equity Capital Markets

Indian Renewable Energy Development Agency / Equity Capital Markets

Indian Renewable Energy Development Agency (IREDA IN)

Indian Renewable Energy Development Agency

<ul>
<li>
<a href="https://www.smartkarma.com/entities/indian-renewable-energy-development-authority" target="_blank" data-smartkarma-citation="entities:40155:1" rel="noopener">IREDA (1845911D IN)</a> is looking to raise at around US$258m in its India IPO. </li>
<li>Indian Renewable Energy Development Authority (IREDA) is a wholly owned Government of India (GoI) enterprise under the administrative control of the Ministry of New and Renewable Energy (MNRE).</li>
<li>In this note, we look at the company’s past performance and share our quick thoughts on valuation.</li>
</ul>



IREDA (1845911D IN) is looking to raise at around US$258m in its India IPO. 
Indian Renewable Energy Development Authority (IREDA) is a wholly owned Government of India (GoI) enterprise under the administrative control of the Ministry of New and Renewable Energy (MNRE).
In this note, we look at the company’s past performance and share our quick thoughts on valuation.


Indian Renewable Energy Development Authority IPO - A Top Player in Indian Renewable Financing

Muthoot Microfin / Equity Capital Markets

<ul>
<li>
<a href="https://www.smartkarma.com/entities/muthoot-microfin" target="_blank" data-smartkarma-citation="entities:39950:1" rel="noopener">Muthoot Microfin (1363943D IN)</a> is looking to raise up to US$163m in its upcoming India IPO. </li>
<li>Muthoot Microfin (MMF) is a microfinance institution providing micro-loans to women customers with a focus on the rural regions of India.</li>
<li>MMF has undergone fast network expansion, which allowed the firm to nearly double its AUM over the track record period. </li>
</ul>



Muthoot Microfin (1363943D IN) is looking to raise up to US$163m in its upcoming India IPO. 
Muthoot Microfin (MMF) is a microfinance institution providing micro-loans to women customers with a focus on the rural regions of India.
MMF has undergone fast network expansion, which allowed the firm to nearly double its AUM over the track record period. 


Muthoot Microfin Pre-IPO - Accelerating Profitability Growth

Research and consultancy, Tabbush Report

Daniel Tabbush

Research and consultancy

Tabbush Report

We provide research and consultancy on Asian banks. Our focus is on what we call “Asian bank research, without the noise.” We are interested in the most critical swing-factors for banks, the NPL and credit cycle, and where we believe there is a gap between perception and reality. We often focus on the less studied components of bank financial statements.  Our research is highly thematic, sometimes examining unlisted banks and companies as a window on mainstream banks. 

Being independent allows us to look at smaller banks, often overlooked by others. Analysis of BIS bank guidelines in the context of Asia, is also a focal point, while we also analyze global banks operating in the region. We use what we believe is the most comprehensive, reliable financials database, SNL Financial. S&P Capital IQ augments our database, with corporate data and CEIC, with economics. 

Asian bank research, without the noise.

Equity Bottom-Up

<ul>
<li>Loan mix is improving, away from non-INR loans, asset mix is improving with less RIDF bonds, and bank is seeing an expanding LDR.  </li>
<li>Loss loans and doubtful loans are in major decline, they are less important to total NPLs, and still credit costs were high in 1Q24, likely overly conservative.</li>
<li>Credit growth is now at 22.6% YoY from 14.9% YoY one year ago, with consistent acceleration. With just 6% loan share, growth can remain high. </li>
</ul>


Loan mix is improving, away from non-INR loans, asset mix is improving with less RIDF bonds, and bank is seeing an expanding LDR.  
Loss loans and doubtful loans are in major decline, they are less important to total NPLs, and still credit costs were high in 1Q24, likely overly conservative.
Credit growth is now at 22.6% YoY from 14.9% YoY one year ago, with consistent acceleration. With just 6% loan share, growth can remain high. 


Axis Bank - Loan Mix Improving Dramatically | Strong ALM | Credit Costs Likely to Narrow Sharply

<ul>
<li>
<a href="https://www.smartkarma.com/entities/hdfc-bank-ltd-4b6b7a92-9087-468d-9dbe-ab169e77f014" target="_blank" data-smartkarma-citation="entities:558:1" rel="noopener">HDFC Bank (HDFCB IN)</a> released its first results since its amalgamation. This can make comparatives difficult where historicals are not adjusted, except for some QoQ items. </li>
<li>We use Dupont Analysis to better understand how the newly amalgamated bank looks now compared with the past, which generally shows a more profitable bank at the core.  </li>
<li>Credit costs, tax expenses are also positives, with the former improving 27bps YoY and the latter improving 23bps YoY. Investment income is a major positive driver in Sep 23 quarter.</li>
</ul>



HDFC Bank (HDFCB IN) released its first results since its amalgamation. This can make comparatives difficult where historicals are not adjusted, except for some QoQ items. 
We use Dupont Analysis to better understand how the newly amalgamated bank looks now compared with the past, which generally shows a more profitable bank at the core.  
Credit costs, tax expenses are also positives, with the former improving 27bps YoY and the latter improving 23bps YoY. Investment income is a major positive driver in Sep 23 quarter.


HDFC Bank - 1st Results After Amalgamation | Dupont Analysis For Comparatives | Credit Cost Decline

<ul>
<li>Cost at PNB are high and rising, a major drag on its ROA and RORWA, which largely offsets better credit metrics. </li>
<li>There are many market positives in India banks, but relative to all large peers, <a href="https://www.smartkarma.com/entities/punjab-national-bank" target="_blank" data-smartkarma-citation="entities:542:1" rel="noopener">Punjab National Bank (PNB IN)</a><span>has the lowest</span> RORWA </li>
<li>There is no LDR expansion at PNB. NIM is languishing. Its high 20% govt loans/total loans is high, with 2 peers' even higher, but better returns. </li>
</ul>


Cost at PNB are high and rising, a major drag on its ROA and RORWA, which largely offsets better credit metrics. 
There are many market positives in India banks, but relative to all large peers, Punjab National Bank (PNB IN)has the lowest RORWA 
There is no LDR expansion at PNB. NIM is languishing. Its high 20% govt loans/total loans is high, with 2 peers' even higher, but better returns. 


Punjab National Bank - Weak Returns, High Costs, High Govt Loans, No LDR Expansion, NIM Down QoQ

India

Bank of India, through its subsidiaries, provides corporate, commercial, personal banking, retail, rural, and development banking.  The Group specializes its services towards corporate and medium businesses, in addition to upmarket retail customers.

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Bank Of India (BOI IN)

Indian Renewable Energy Development Authority IPO - A Top Player in Indian Renewable Financing

IREDA (1845911D IN) is looking to raise at around US$258m in its India IPO. In this note, we look at the company’s past performance and share our...

Ethan Aw

Muthoot Microfin Pre-IPO - Accelerating Profitability Growth

Muthoot Microfin (1363943D IN) is looking to raise up to US$163m in its upcoming India IPO. MMF has undergone fast network expansion, which allowed...

Ethan Aw

Axis Bank - Loan Mix Improving Dramatically | Strong ALM | Credit Costs Likely to Narrow Sharply

LDR is improving dramatically, loan mix is better, less low-yield bonds supports NIM. Loss and doubtful loans are less important, so credit costs...

Daniel Tabbush

HDFC Bank - 1st Results After Amalgamation | Dupont Analysis For Comparatives | Credit Cost Decline

Fist earnings results since amalgamation and they are strong. Dupont Analysis may be best way to view how bank is changing, where historicals are...

Daniel Tabbush

Punjab National Bank - Weak Returns, High Costs, High Govt Loans, No LDR Expansion, NIM Down QoQ

PNB is seeing rising operating costs, languishing NIM, stagnant LDR. Its high government loans may be a key burden on returns. Credit cost decline...

Daniel Tabbush

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