Pan-Asia Catalysts/Events, Quiddity Advisors

Travis Lundy

Pan-Asia Catalysts/Events

Quiddity Advisors

Event-Driven

A "Buyback" is where (for our purposes) a publicly-listed company repurchases its shares from existing shareholders, sometimes in the market, sometimes in a structured buyback off exchange, and sometimes at a price higher than market price (in this insight, we will use the nouns "Buy-back" and "Buyback" interchangeably; the official regulatory documents in India often use the form with the hyphen).When companies use excess cash to buy back shares, they often not only end up optimising their capital structure but also "achieve" EPS accretion with the aid of a reduction in the total share count of the company. Some companies use buy-backs to support their share prices during sluggish periods and others attempt to use it as a defence mechanism against hostile takeover situations.  Still others in India use it to return capital to their promoters.All that is pretty well-known.In India, such Buy-backs are governed by the <a href="https://www.sebi.gov.in/legal/regulations/jul-2019/securities-and-exchange-board-of-india-buy-back-of-securities-regulations-2018-last-amended-on-april-17-2020-_40327.html" target="_blank" rel="noopener">SEBI (BUY-BACK OF SECURITIES) REGULATIONS, 2018</a> (last amended on 17th April 2020) and are principally executed through three main mechanisms - Tender Offers, On-Market Transactions, and Book-building Processes. This insight is the first of a two-part series by Quiddity on Indian Buy-backs.In this insight, we will look into the regulations that govern each of the buy-back mechanisms to discover the basis for how they get executed.

A "Buyback" is where (for our purposes) a publicly-listed company repurchases its shares from existing shareholders, sometimes in the market, sometimes in a structured buyback off exchange, and sometimes at a price higher than market price (in this insight, we will use the nouns "Buy-back" and "Buyback" interchangeably; the official regulatory documents in India often use the form with the hyphen).When companies use excess cash to buy back shares, they often not only end up optimising their capital structure but also "achieve" EPS accretion with the aid of a reduction in the total share count of the company. Some companies use buy-backs to support their share prices during sluggish periods and others attempt to use it as a defence mechanism against hostile takeover situations.  Still others in India use it to return capital to their promoters.All that is pretty well-known.In India, such Buy-backs are governed by the SEBI (BUY-BACK OF SECURITIES) REGULATIONS, 2018 (last amended on 17th April 2020) and are principally executed through three main mechanisms - Tender Offers, On-Market Transactions, and Book-building Processes. This insight is the first of a two-part series by Quiddity on Indian Buy-backs.In this insight, we will look into the regulations that govern each of the buy-back mechanisms to discover the basis for how they get executed.

Quiddity India Buy-Back Guide 2021: Regulations & Patterns

Pan-Asia Index Rebalances/ Events/ Delta One, Periscope Analytics

Brian Freitas

Pan-Asia Index Rebalances/ Events/ Delta One

Index Rebalance

The <a href="https://www.smartkarma.com/entities/s-p-bse-sensex-index" target="_blank" data-smartkarma-citation="entities:31494:1" rel="noopener">S&amp;P BSE SENSEX Index (SENSEX INDEX)</a> is the flagship index of the Bombay Stock Exchange (BSE). The index has 30 stocks and is a free float weighted market cap index. The next rebalance will be effective after the close of trading on 17 December.The December review uses the market cap and turnover data from 1 May to 31 October to determine the stocks to be included and excluded from the index, and the announcement of the changes is done 4 weeks before the rebalance effective date.After missing out on index inclusion at the June rebalance, <a href="https://www.smartkarma.com/entities/wipro-ltd" target="_blank" data-smartkarma-citation="entities:15360:1" rel="noopener">Wipro Ltd (WPRO IN)</a> has a high probability of being included at the upcoming review. <a href="https://www.smartkarma.com/entities/bajaj-auto-ltd" target="_blank" data-smartkarma-citation="entities:3613:1" rel="noopener">Bajaj Auto Ltd (BJAUT IN)</a> is the most likely deletion from the index.<a href="https://www.smartkarma.com/entities/wipro-ltd" target="_blank" data-smartkarma-citation="entities:15360:1" rel="noopener">Wipro Ltd (WPRO IN)</a> will have over 2 days of ADV (and 7 days of delivery volume) to buy from passive funds while <a href="https://www.smartkarma.com/entities/bajaj-auto-ltd" target="_blank" data-smartkarma-citation="entities:3613:1" rel="noopener">Bajaj Auto Ltd (BJAUT IN)</a> will have nearly 3.5 days of ADV (10 days of delivery volume) to sell.

The S&amp;P BSE SENSEX Index (SENSEX INDEX) is the flagship index of the Bombay Stock Exchange (BSE). The index has 30 stocks and is a free float weighted market cap index. The next rebalance will be effective after the close of trading on 17 December.The December review uses the market cap and turnover data from 1 May to 31 October to determine the stocks to be included and excluded from the index, and the announcement of the changes is done 4 weeks before the rebalance effective date.After missing out on index inclusion at the June rebalance, Wipro Ltd (WPRO IN) has a high probability of being included at the upcoming review. Bajaj Auto Ltd (BJAUT IN) is the most likely deletion from the index.Wipro Ltd (WPRO IN) will have over 2 days of ADV (and 7 days of delivery volume) to buy from passive funds while Bajaj Auto Ltd (BJAUT IN) will have nearly 3.5 days of ADV (10 days of delivery volume) to sell.

Sensex Dec 2021 Index Rebalance Preview: Wipro Could Be IN, Pushing Bajaj Auto OUT

External broker reports(aggregated public sources), HDFC Securities

HDFC Securities

External broker reports(aggregated public sources)

Equity Bottom-Up

HSIE Results Daily NTPC: Generation/sales increased 19.2%/19.3% YoY to 71.7bn/66.6bn unit in Q1FY22 on the back of demand recovery. Coal PAF, however, declined in Q1FY22 to 94% vs 96% YoY, but coal PLF was up at 70% in Q1FY22 vs 58.2% YoY. Underrecovery in Q1FY22 came in at INR1.9bn. After adjusting for previous periods and one-off items, adjusted PAT came in at INR31.6bn above our estimate. Debtors (&gt;45 days) increased to INR90bn vs INR65bn QoQ during the second corona wave. NTPC plans to add 15GW of RES capacity by FY24 and another 45GW by FY32.
<div class="content-highlight">Content is external broker report sourced from online content aggregator through publicly available sources and is displayed below for general informational purposes only. Refer full disclaimer below.</div>

HSIE Results Daily NTPC: Generation/sales increased 19.2%/19.3% YoY to 71.7bn/66.6bn unit in Q1FY22 on the back of demand recovery. Coal PAF, however, declined in Q1FY22 to 94% vs 96% YoY, but coal PLF was up at 70% in Q1FY22 vs 58.2% YoY. Underrecovery in Q1FY22 came in at INR1.9bn. After adjusting for previous periods and one-off items, adjusted PAT came in at INR31.6bn above our estimate. Debtors (&gt;45 days) increased to INR90bn vs INR65bn QoQ during the second corona wave. NTPC plans to add 15GW of RES capacity by FY24 and another 45GW by FY32.
Content is external broker report sourced from online content aggregator through publicly available sources and is displayed below for general informational purposes only. Refer full disclaimer below.

HSIE Results Daily: NTPC, IOC, Britannia and More

External broker reports(aggregated public sources), ICICI Securities Ltd

ICICI Securities Limited

NTPC has 17% of total installed capacity in India with 23% generation share The company's vision is to become a 130 GW+ company by 2032 of which 60 GW would be contributed by renewable energy Q1FY22 Results: NTPC reported Q1FY22 results, which were below estimates on...<div class="content-highlight">Content is external broker report sourced from online content aggregator through publicly available sources and is displayed below for general informational purposes only. Refer full disclaimer below.</div>

NTPC has 17% of total installed capacity in India with 23% generation share The company's vision is to become a 130 GW+ company by 2032 of which 60 GW would be contributed by renewable energy Q1FY22 Results: NTPC reported Q1FY22 results, which were below estimates on...Content is external broker report sourced from online content aggregator through publicly available sources and is displayed below for general informational purposes only. Refer full disclaimer below.

NTPC India: Transitioning Towards Greener Side

We maintain a BUY rating and FY23 P/BV (consolidated) TP of INR 143/share (+25% from the current level). The stock is currently trading at a FY23 standalone P/BV of 0.9x and a PE of 6.5x (consolidated PE of 5.7x). NTPC: Generation/sales increased 13.7%/13.8% YoY to 77.6bn/72.2bn unit in Q4FY21 on the back of demand recovery. PAF, however, declined in Q4 to 89% vs 94% YoY, but was up at 91.5% in FY21 vs 89.7% YoY. Underrecovery in FY21 came in at INR6bn vs INR2.5 YoY. After adjusting for previous periods and one-off items, adjusted PAT increased by a healthy 31% YoY to INR38.3bn in Q4.<div class="content-highlight">Content is external broker report sourced from online content aggregator through publicly available sources and is displayed below for general informational purposes only. Refer full disclaimer below.</div>

We maintain a BUY rating and FY23 P/BV (consolidated) TP of INR 143/share (+25% from the current level). The stock is currently trading at a FY23 standalone P/BV of 0.9x and a PE of 6.5x (consolidated PE of 5.7x). NTPC: Generation/sales increased 13.7%/13.8% YoY to 77.6bn/72.2bn unit in Q4FY21 on the back of demand recovery. PAF, however, declined in Q4 to 89% vs 94% YoY, but was up at 91.5% in FY21 vs 89.7% YoY. Underrecovery in FY21 came in at INR6bn vs INR2.5 YoY. After adjusting for previous periods and one-off items, adjusted PAT increased by a healthy 31% YoY to INR38.3bn in Q4.Content is external broker report sourced from online content aggregator through publicly available sources and is displayed below for general informational purposes only. Refer full disclaimer below.

India

NTPC Ltd. owns and operates power generation plants that supply power to state electricity boards throughout India.  The Company is a public sector undertaking of the Government of India and it also undertakes turnkey consulting projects to set up power plants.

Price Gauge
52-week Range	0.00 - 0.00
Market Cap (USDm)	0.00
P/E	0.00
Dividend (Yield)	0.00

NTPC Ltd (NTPC IN)

Quiddity India Buy-Back Guide 2021: Regulations & Patterns

This insight is a basic primer of Indian buyback types, rules and regulations, and is part of a two-part series, with the other part being a

Travis Lundy

Sensex Dec 2021 Index Rebalance Preview: Wipro Could Be IN, Pushing Bajaj Auto OUT

Half way through the review period for the Sensex, we expect Wipro replaces Bajaj Auto at the December rebalance. Both stocks trade cheaper than...

Brian Freitas

HSIE Results Daily: NTPC, IOC, Britannia and More

NTPC: Generation/sales increased 19.2%/19.3% YoY to 71.7bn/66.6bn unit in Q1FY22 on the back of demand recovery. Coal PAF, however, declined in...

HDFC Securities

NTPC India: Transitioning Towards Greener Side

NTPC has 17% of total installed capacity in India with 23% generation share The company's vision is to become a 130 GW+ company by 2032 of which 60...

ICICI Securities Limited

HSIE Results Daily: NTPC

We maintain a BUY rating and FY23 P/BV (consolidated) TP of INR 143/share (+25% from the current level). The stock is currently trading at a FY23...

HDFC Securities

Price Gauge

52-week Range

Market Cap (USDm)

P/E

Dividend (Yield)