India BFSI - Long-Short - Equity Research Analyst

Raj S, CA, CFA

Artoval Advisors

Art’o’val stands for Art of Valuation. Artoval Advisors LLP is a professionally run advisory firm catering to various financial advisory services including Valuation, Investment Research, Training, Accounting, CFO Services and other ancillary services.

We are passionate about what we do and strongly believe in working with our clients as their extended teams. With Artoval Advisors as their trusted partner, our clients find it easy to achieve efficiency in service delivery without compromising on quality.

True Art of Valuation

Equity Bottom-Up

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<a href="https://www.smartkarma.com/entities/state-bank-of-india" target="_blank" data-smartkarma-citation="entities:160:1" rel="noopener">State Bank Of India (SBIN IN)</a> is the best-performing PSU bank in India and shows clear convergence with private peers across fundamental metrics beyond what its valuations might suggest</li>
<li>Medium-Term ROE Forecast of 16% to 18% and loan growth forecast of 14% to 16%; ROA ~1.2% consistently; Strong fee income; successful cross-selling through subsidiaries; Strong asset quality.
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 P/BV is cheap at 1.3x FY25e, compared private peers’ valuations of 2.5x to 3.0x. SBIN can potentially re-rate to P/BV of ~1.6x FY25e in the near term (~35% upside).</li>
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State Bank Of India (SBIN IN) is the best-performing PSU bank in India and shows clear convergence with private peers across fundamental metrics beyond what its valuations might suggest
Medium-Term ROE Forecast of 16% to 18% and loan growth forecast of 14% to 16%; ROA ~1.2% consistently; Strong fee income; successful cross-selling through subsidiaries; Strong asset quality.


 P/BV is cheap at 1.3x FY25e, compared private peers’ valuations of 2.5x to 3.0x. SBIN can potentially re-rate to P/BV of ~1.6x FY25e in the near term (~35% upside).


State Bank Of India (SBIN IN): Initiation -  Convergence with Private Peers, Poised for Re-Rating

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<a href="https://www.smartkarma.com/entities/state-bank-of-india" target="_blank" data-smartkarma-citation="entities:160:1" rel="noopener">State Bank Of India (SBIN IN)</a> has reported its 3Q24 (Dec-23) results with a one-off pension and wages revision charge which impacts the short-term earnings profile.</li>
<li>Medium-Term ROE Forecast Intact (16% to 18%) with management confident of even touching 20% in next couple of years; loan growth forecast of 14% to 16% for FY25e-FY26e.</li>
<li>We reiterate our view: P/BV is cheap at 1.3x FY25e. SBIN has the potential to re-rate to P/BV of ~1.6x FY25e in the near term (~40% upside). Opportunity to ADD.</li>
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State Bank Of India (SBIN IN) has reported its 3Q24 (Dec-23) results with a one-off pension and wages revision charge which impacts the short-term earnings profile.
Medium-Term ROE Forecast Intact (16% to 18%) with management confident of even touching 20% in next couple of years; loan growth forecast of 14% to 16% for FY25e-FY26e.
We reiterate our view: P/BV is cheap at 1.3x FY25e. SBIN has the potential to re-rate to P/BV of ~1.6x FY25e in the near term (~40% upside). Opportunity to ADD.


State Bank of India (SBIN) - 3Q24 Update: Short-Term Pressure Is an Opportunity to Accumulate

External broker reports(aggregated public sources), Axis Direct

Axis Direct

External broker reports(aggregated public sources)

Axis Direct is the flagship brand under Axis Securities Limited, a subsidiary of Axis Bank in India. 

Content available is external broker reports authored by a third party outside the Smartkarma network and has been aggregated by an online aggregator through publicly available sources and is displayed by Smartkarma in this format for user's convenience and general informational purposes only. Content does not constitute investment or financial advice and Smartkarma makes no representation or warranty regarding its accuracy or contents. Original third party author retains all copyright and other proprietary rights in the content. Access or use of third party links not controlled by Smartkarma are at the user's own risk.

<ul><li>With growth prospects remaining intact and the management confident to grow AUM at 14-15% and deposits at 12-13%, we model in advances growth of 13.5%+ over FY24-26E.</li><li>Further, the management is confident of maintaining domestic margins at current levels going forwad.</li><li>However, margins may be impacted by 2-3bps due to an increase in cost of funds. Opex is expected to remain elevated due to provision for wage revision. </li></ul>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.

With growth prospects remaining intact and the management confident to grow AUM at 14-15% and deposits at 12-13%, we model in advances growth of 13.5%+ over FY24-26E.Further, the management is confident of maintaining domestic margins at current levels going forwad.However, margins may be impacted by 2-3bps due to an increase in cost of funds. Opex is expected to remain elevated due to provision for wage revision. 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.

State Bank of India - Loan Growth Momentum Intact, Pension Blip Impacts PAT

Thematic (Sector/Industry)

<ul><li>The Axis Top Picks Basket delivered an excellent return of 5.8% in Apr’24 against the 1.2% return posted by Nifty 50, thereby beating the benchmark by a wide margin of 4.6%.</li><li>Over the last one year, the basket has gained 49%. Moreover, it gives us immense joy to inform you that our Top Picks Basket has delivered an impressive return of 284% since its inception (May’20), which stands well above the 144% return delivered by the NIFTY 50 index over the same period.</li><li>In light of this, we continue to believe in our thematic approach to Top Picks selection.</li></ul>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.

The Axis Top Picks Basket delivered an excellent return of 5.8% in Apr’24 against the 1.2% return posted by Nifty 50, thereby beating the benchmark by a wide margin of 4.6%.Over the last one year, the basket has gained 49%. Moreover, it gives us immense joy to inform you that our Top Picks Basket has delivered an impressive return of 284% since its inception (May’20), which stands well above the 144% return delivered by the NIFTY 50 index over the same period.In light of this, we continue to believe in our thematic approach to Top Picks selection.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.

Head of Research, IPOs & Placements, Aequitas Research

Sumeet Singh

Head of Research, 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.

Event-Driven

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<a href="https://www.smartkarma.com/entities/honasa-consumer-ltd" target="_blank" data-smartkarma-citation="entities:36117:1" rel="noopener">Honasa Consumer (HONASA IN)</a> raised about US$200m in its India IPO. Its pre-IPO investors will be released from its IPO linked lockup soon.</li>
<li>HC’s product portfolio includes products in the baby care, face care, body care, hair care, color cosmetics and fragrances segments.</li>
<li>In this note, we talk about the upcoming lock-up expiry and possible deal dynamics.</li>
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Honasa Consumer (HONASA IN) raised about US$200m in its India IPO. Its pre-IPO investors will be released from its IPO linked lockup soon.
HC’s product portfolio includes products in the baby care, face care, body care, hair care, color cosmetics and fragrances segments.
In this note, we talk about the upcoming lock-up expiry and possible deal dynamics.


Honasa Consumer IPO Lock-Up Expiry - US$500m+ Lockup Expiry with Everyone Well in the Money

India

State Bank of India provides a wide range of banking and financial services to corporate, institutional, commercial, agricultural, industrial and individual customers throughout India.  The Bank also provides international banking to its Indian customers and has operations in other countries.

State Bank Of India (SBIN IN)