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India

India: FSN E-Commerce Ventures (Nykaa), Star Health, JSW Steel Ltd, Tata Consumer Products, Metropolis Healthcare Limited, ICICI Securities Ltd, Hindustan Unilever and more

By | Daily Briefs, India

In today’s briefing:

  • Nykaa IPO: Not Perfectly Elegant
  • Star Health Insurance Pre-IPO – Leading the Retail Healthcare Insurance Space
  • JSW Steel – Event Flash – Launches Dual-Tranche Notes Offering – Lucror Analytics
  • Gross margin pressure to ease in coming quarters
  • Metropolis Healthcare Ltd Rs Company Update
  • Initiating Coverage:ICICI Securities
  • Hindustan Unilever: Transforming To An Intelligent And Future Fit Organization

Nykaa IPO: Not Perfectly Elegant

By Nitin Mangal

We continue our focus on the coverage of IPO bound start-ups and next is none other than FSN E-Commerce Ventures (Nykaa) (1003622D IN). However, Nykaa stands apart from the rest since it is the one of those rare finds that have a positive profitability and this is why it looks promising in nature. Another differentiating aspect is that Nykaa operates as an omni-channel entity, having as many as 73 physical stores across the country. (However, most of the revenue is generated online).

Nykaa was founded only in 2012 and has gained a strong foothold in the beauty and personal care (BPC) space especially in the last few years. According to RedSeer, the company is the largest Specialty BPC platform in India in terms of value of products sold in F21. The company manages its BPC predominantly through inventory model, not to forget that it also has its own brands which it outsources the manufacturing. Nykaa has also started the ball rolling in the fashion territory in 2018, for which it mostly acts as a market place for its consumers and vendors.

Nykaa has a strong operational characteristics, there is hardly any doubt; however, one needs to look beyond it to get a more comprehensive view of the financials and governance. There are a few concerns on the accounting front that should not be overlooked. We also find stains on the governance, primarily related to remuneration of MD. Further, there were several small risk factors which were disclosed, that had acted as a resistance force in the past.


Star Health Insurance Pre-IPO – Leading the Retail Healthcare Insurance Space

By Sumeet Singh

Star Health and Allied Insurance (SHAI), the largest private health and retail health insurance company in India, plans to raise around US$1.0bn in its India IPO. It is backed by Westbridge and Rakesh Jhunjhuwala. Owing to the latter, it will draw a lot of retail interest. 

SHAI insured 20.5m people in FY21. SHAI primarily offers retail health insurance which accounted for 87.9% of its FY21 GWP. Individual agents accounted for 97% of its FY21 GWP. 

Its GWP has grown by 72.6% over FY19-21 on the back of 58.6% growth in agents and 62.5% growth in the number of policies. SHAI has consistently grown faster than the industry over the past few years resulting in a steady increase in its market share. With a gross written premium (GWP) of INR93.5bn in FY21, SHAI had a market share of 15.8% in the Indian health insurance market and 31.3% in the retail health insurance market. 

Along with growing fast, SHAI has also managed to remain profitable since FY16 with its claims ratio remaining below 67% in most years. Although, the company recorded a loss in FY21 on the back of higher claims due to COVID-19 and reinsurance related adjustments. In addition, as the second COVID-19 wave only peaked in 1Q22, FY22 will be impacted as well.


JSW Steel – Event Flash – Launches Dual-Tranche Notes Offering – Lucror Analytics

By Trung Nguyen

We believe that the outlook for JSW Steel is positive, underpinned by: [1] capacity growth, especially the scheduled commencement of a 5 mtpa Dolvi expansion in Q3/21-22; and [2] high steel prices and good product spreads. Leverage is modest and will likely improve further, while liquidity is adequate. The event risk associated with the acquisition of BPSL is partly contained by the sharing structure, with JSW owning only 49% for now (option to increase to 83%).

We expect positive rating pressure, particularly for Fitch. JSW is currently rated Ba2 (positive) / BB- (positive) by Moody’s / Fitch. We believe Fitch may upgrade JSW’s ratings by FYE 2021-22, as the company’s leverage may meet the positive triggers if the operating environment does not deteriorate sharply.


Gross margin pressure to ease in coming quarters

By Motilal Oswal

Tea price inflation has impacted TCP’s performance since the last four quarters. However, we expect gross margin to improve from 2QFY22 onwards as tea prices have declined (down 32% from their peak in Aug’20 to INR175/kg in Aug’21). In this note, we have analyzed the impact of the fall in tea prices on TCP in the near term. Here are the key insights:…

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Metropolis Healthcare Ltd Rs Company Update

By Edelweiss

Healthy expansion plan; major beneficiary of sector consolidation

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Initiating Coverage:ICICI Securities

By Axis Direct

We initiate coverage with a BUY rating and a target price of Rs 870/share (19x Sept’23E EPS), implying an upside of 22% from CMP.

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Hindustan Unilever: Transforming To An Intelligent And Future Fit Organization

By Axis Direct

We marginally revise our FY23E/24E and maintain BUY with a revised TP of Rs. 3,100 (earlier Rs. 2,670) as we raise our target PE to 56x FY24E EPS (earlier 50x FY24E EPS).

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India: CE Info Systems (MapmyIndia), Gland Pharma Ltd, Allcargo Logistics, Minda Corp Ltd, Hindustan Unilever, Apl Apollo Tubes, Can Fin Homes, Nocil Ltd, Wabco India Ltd, Mold Tek Packaging and more

By | Daily Briefs, India

In today’s briefing:

  • CE Info Systems (MapmyIndia) Pre-IPO Tearsheet
  • Gland Pharma: Charting New Frontiers Of Growth
  • Allcargo (AGLL IN): Shareholders Reject! What Now?
  • Pick of the Week: Minda Corporation
  • Longer term growth engines robustLonger term growth engines robust
  • APL Apollo Tubes (Initiating coverage): Journey from a semi-commodity player to a branded one. BUY
  • Pick of the Week – Can Fin Homes Limited
  • NOCIL: Accelerating Growth Momentum
  • Wabco India Limited: Long Term Growth Remains Intact
  • Mold-Tek Packaging: Strong Growth Outlook; Attractive Valuations

CE Info Systems (MapmyIndia) Pre-IPO Tearsheet

By Clarence Chu

CE Info Systems (MapmyIndia) is looking to raise US$137m in its upcoming India IPO. The deal will be run by Axis Capital, JM Financial, Kotak and Dam Capital.

CE Info Systems is India’s leading provider of advanced digital maps, geospatial software and location-based IoT Technologies, as per Frost & Sullivan (F&S). As of 31 Mar 21, it’s digital maps cover 6.29m km of roads in India, and have serviced over 2,000 enterprise customers since its inception. Its services include digital maps as a service (MaaS), software as a service (SaaS) and platform as a service (PaaS). In FY21, it had over 500 customers on its MaaS, SaaS and PaaS platforms.


Gland Pharma: Charting New Frontiers Of Growth

By Axis Direct

We expect revenue and PAT CAGR of 18.2% and 19.7% respectively over FY21-FY24E and recommend a HOLD with TP of Rs 4,100, implying an upside of 3% from CMP.

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Allcargo (AGLL IN): Shareholders Reject! What Now?

By Janaghan Jeyakumar, CFA

Allcargo Logistics (AGLL IN) announced after market-close yesterday that their shareholders had rejected their proposal for voluntary delisting bringing an abrupt end to an event trade that was gathering a lot of momentum. 

Since the time the Deal was announced in August 2020, Allcargo share price has more-than-doubled.

However, this is now a Deal Break situation. 

More below the fold.


Pick of the Week: Minda Corporation

By Axis Direct

Minda Corporation (Minda Corp) is the flagship company of the Spark Minda group and is a leading supplier of key auto components to domestic as well as global OEMs. It has a well-diversified presence across all segments including 2W, CV, PV, and Aftermarket that contributed 52%/21%/11%/16% of its FY21 sales, respectively. Geographically, India contributes ~85% of the company’s sales while the rest ~15% is contributed by the overseas markets. Its customer base comprises Indian OEMs with top marquee clients being Bajaj Auto, Ashok Leyland, TVS Motors, Suzuki Motors, and M&M.

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Longer term growth engines robustLonger term growth engines robust

By Motilal Oswal

The management shared details on the augmentation of its analytics and R&D; strengths, which were already far superior v/s peers. As highlighted in our Annual Report note, there have been a host of initiatives in the past year focusing on the burgeoning E-Commerce market, which now contributes 89% to HUVR’s sales. The company’s portfolio is already wellplaced, with its E-Commerce market share higher than its Modern Trade (MT)…

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APL Apollo Tubes (Initiating coverage): Journey from a semi-commodity player to a branded one. BUY

By HDFC Securities

We expect it continue to trade at such premium multiple and initiate coverage on APL with a BUY rating at a TP of INR2,226/share (35x FY24E EPS). APL Apollo Tubes (APL) is Indias leading structural steel tube manufacturer with a capacity of 2.6 million tonne per annum (mtpa) and a pan-India presence. APLs market share enhanced from 27% in FY16 to 50% in FY21, led by a strong distribution network, branding, offering of customized & innovative products and capacity enhancement. APLs strategy to focus on rural areas and tier 2/3 cities paid off well during the reverse migration last year.

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Pick of the Week – Can Fin Homes Limited

By Edelweiss

Can Fin Homes Ltd. is a South India-based housing finance company

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NOCIL: Accelerating Growth Momentum

By Axis Direct

NOCIL Ltd. (NOCIL) delivered robust growth in FY21 on account of recovery in the global economic activities, new customer acquisition resulting in 14% YoY growth in sales volume, and gradual ramp-up in the capacity utilization. However, the company’s operating performance in H1FY21 was subdued as nationwide lockdowns led to lower absorption of fixed costs. This improved gradually in H2FY21 with the easing of restrictions. NOCIL continues to consistently focus on capacity expansion toachieve future growth.

We maintain our BUY recommendation with a TP of Rs 315 valuing it at 20x FY24E EPS.

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Wabco India Limited: Long Term Growth Remains Intact

By Geojit BNP Paribas

Q1FY22 revenue de-grew by -31% QoQ due to significant decline in the commercial vehicle volume, down by 92% YoY. This was largely due to production lockdown and lower demand globally. EBITDA margin came at 8.6% due to higher input cost and other expenses. Net profit tanked by 55% QoQ. Wabco ZF technological advantage in the CV segment will provide significant growth in product intelligence and will result in higher value enhancing offer for the domestic and global customers….

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Mold-Tek Packaging: Strong Growth Outlook; Attractive Valuations

By Axis Direct

We retain a BUY with TP of Rs 585/share and continue to value the stock at a target multiple of 20x basis FY24E EPS. We recently interacted with the management of Mold-Tek Packaging Ltd. to get an outlook on the industry and the company for FY22E/FY23E.

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India: Nippon Life India Asset Management, Greenland Hong Kong Holdings and more

By | Daily Briefs, India

In today’s briefing:

  • Axis Annual Analysis:Nippon Life Ind.
  • Morning Views Asia: China South City, JSW Steel Ltd

Axis Annual Analysis:Nippon Life Ind.

By Axis Direct

Long-term prospects of the Indian AMC industry continue to be positive given its low penetration levels vis–vis developed countries. On sustained cost controls and improved outlook, we maintain our BUY rating with a target price of Rs 485 (32x FY23E EPS).

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Morning Views Asia: China South City, JSW Steel Ltd

By Charles Macgregor

Lucror Analytics Morning Views comprise our fundamental credit analysis, opinions and trade recommendations on high yield issuers in the region, based on key company-specific developments in the past 24 hours. Our Morning Views include a section with a brief market commentary, key market indicators and a macroeconomic and corporate event calendar.


Before it’s here, it’s on Smartkarma

India: Info Edge India and more

By | Daily Briefs, India

In today’s briefing:

  • The grand job-wedding-housewarming party is here!

The grand job-wedding-housewarming party is here!

By ICICI Securities Limited

As we anticipated in mid-Jun-21 (link), hiring across sectors has witnessed a robust pickup. Net EPFO additions in Jun-21 were ~85% higher than the pre-covid run-rate. RBI’s Aug-21 State of the economy’ report (link) hints at up to ~38% YoY salary hikes across sectors the best in 15 years. Resignations and voluntary retirements too are surging in line with global trends. Rethinking of work’ by employees is driving massive supply-demand mismatch across industries further boosting the need for search’ platforms like Naukri.

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Before it’s here, it’s on Smartkarma

India: Affle (India) Limited and more

By | Daily Briefs, India

In today’s briefing:

  • Affle (India) (BUY): Annual report analysis Sustained R&D focus

Affle (India) (BUY): Annual report analysis Sustained R&D focus

By BOB Capital Markets Ltd.

Ecosystem-level partnerships fortify AFFLE’s defense against data/ privacy risk

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Before it’s here, it’s on Smartkarma

India: Can Fin Homes, Mold Tek Packaging, Surya Roshni and more

By | Daily Briefs, India

In today’s briefing:

  • Pick of the Week – Can Fin Homes Limited
  • Mold-Tek Packaging: Strong Growth Outlook; Attractive Valuations
  • Surya Roshni: Backend Infrastructure Ready as Opportunities Galore

Pick of the Week – Can Fin Homes Limited

By Edelweiss

Can Fin Homes Ltd. is a South India-based housing finance company

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Mold-Tek Packaging: Strong Growth Outlook; Attractive Valuations

By Axis Direct

We retain a BUY with TP of Rs 585/share and continue to value the stock at a target multiple of 20x basis FY24E EPS. We recently interacted with the management of Mold-Tek Packaging Ltd. to get an outlook on the industry and the company for FY22E/FY23E. 

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Surya Roshni: Backend Infrastructure Ready as Opportunities Galore

By IDBI Capital

We initiate coverage on Surya Roshni (Surya) with a BUY rating and a target price of Rs694. Surya is the second largest manufacturer of steel pipes (contributes 67% to EBITDA) and also the second largest LED manufacturer in India. With focus on improvement in product mix in steel pipes segment, we expect its margins to improve over the next two-three years. In Lighting & Consumer Durables segment, we anticipate strong growth in segment revenue led by rising demand for LED lights in India and also import substitution.

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India: Nippon Life India Asset Management, Gland Pharma Ltd, HDFC Standard Life Insurance, Hindustan Oil Exploration Company, Info Edge India and more

By | Daily Briefs, India

In today’s briefing:

  • Axis Annual Analysis:Nippon Life Ind.
  • Gland Pharma: Charting New Frontiers Of Growth
  • Event Update – Relatively expensive deal compared to synergies – HOLD
  • Hindustan Oil Exploration Company Ltd. (HOEC)
  • The grand job-wedding-housewarming party is here!

Axis Annual Analysis:Nippon Life Ind.

By Axis Direct

Long-term prospects of the Indian AMC industry continue to be positive given its low penetration levels vis–vis developed countries. On sustained cost controls and improved outlook, we maintain our BUY rating with a target price of Rs 485 (32x FY23E EPS).

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Gland Pharma: Charting New Frontiers Of Growth

By Axis Direct

We expect revenue and PAT CAGR of 18.2% and 19.7% respectively over FY21-FY24E and recommend a HOLD with TP of Rs 4,100, implying an upside of 3% from CMP.

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Event Update – Relatively expensive deal compared to synergies – HOLD

By Prabhudas Lilladhar

Deal valued at 2.5x at current EV of Rs27.1bn for Exide Life, looks on expensive side but 35% discount to listed players (ex-HDFCLI) HDFC Life is making a second attempt at an inorganic deal with acquisition of Exide Life for Rs66.87bn valuing the company at 2.5x current EV. The rationale for the deal has been (i) strong agency business (adds 40% to…

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Hindustan Oil Exploration Company Ltd. (HOEC)

By AUM Capital

Incorporated in the year 1983, Hindustan Oil Exploration Company Ltd. (HOEC) based in Vadodara is one of the first private companies to be involved in exploration, development and production of crude oil and natural gas in India through a mix of onshore and offshore assets. The company operates 10 out of 11 blocks with discovered and producing resources and covering 4 out of 7 basins in…

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The grand job-wedding-housewarming party is here!

By ICICI Securities Limited

As we anticipated in mid-Jun-21 (link), hiring across sectors has witnessed a robust pickup. Net EPFO additions in Jun-21 were ~85% higher than the pre-covid run-rate. RBI’s Aug-21 State of the economy’ report (link) hints at up to ~38% YoY salary hikes across sectors the best in 15 years. Resignations and voluntary retirements too are surging in line with global trends. Rethinking of work’ by employees is driving massive supply-demand mismatch across industries further boosting the need for search’ platforms like Naukri.

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India: Cholamandalam Investment and Finance, Pi Industries, Whirlpool of India, Aditya Birla Capital Ltd, Sudarshan Chemical Industries, Vinati Organics, Dcb Bank Ltd, Apl Apollo Tubes, Bharti Airtel and more

By | Daily Briefs, India

In today’s briefing:

  • Sector Update – CV Financiers Structural weakness persists for FY22; stay selective
  • CSM segment going from strength to strength!
  • Ashika – Stock Picks – Whirlpool of India Ltd. – September 2021
  • Bharti Airtel: Raising Funds to Fuel Future Growth
  • Flurry of Senior Level Exits at Aditya Birla Financial Services
  • Sudarshan Chemical: Anti-Dumping on Mica to Aid Earnings by 5-10%
  • Vinati Organics: Quarterly Highlights
  • DCB Bank: Valuations Attractive!
  • APL Apollo Tubes (APAT) is the largest manufacturer of Structural Steel Tubes in India
  • Bharti Airtel: Rights Issue to Meet Accelerated Investments

Sector Update – CV Financiers Structural weakness persists for FY22; stay selective

By Prabhudas Lilladhar

Our extensive channel checks across first time buyers, small & large fleet operators and credit heads are suggestive of a bleak 9MFY22 for CV financiers. While lockdown impositions stand behind and collection efficiencies have picked up (avg. 90%), the repayment capabilities of driver/owner, small fleet operators continue to remain weak. While festive season demand is building up, fleet operators expect mere 10-15% business growth uptick from current levels and the same is function of improved consumption trends.

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CSM segment going from strength to strength!

By Motilal Oswal

CSM segment going from strength to strength! PI’s FY21 Annual Report highlights its intention to build multiple growth engines and take PI to the next level in the global arena, with more substantive participation in the Life Sciences domain. Here are the key insights:…

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Ashika – Stock Picks – Whirlpool of India Ltd. – September 2021

By Ashika Research

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Bharti Airtel: Raising Funds to Fuel Future Growth

By Axis Direct

We recommend a BUY rating on the stock with SOTP based valuation at Rs 700 indicating 13% upside from CMP owing to the company’s better margins, stronger subscriber growth, and higher data consumption.

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Flurry of Senior Level Exits at Aditya Birla Financial Services

By Hemindra Hazari

Senior executives are rushing for the exit door at Aditya Birla Finance Ltd. (ABFL), the non-bank finance company (NBFC) subsidiary of Aditya Birla Capital Ltd (ABCAP IN) (ABC), the holding company for all the financial services business of the Aditya Birla group. Since May 2021, at least five senior officials in-charge of business verticals and control functions including the Chief Financial Officer (CFO) have quit.

 Coincidentally, the Securities and Exchange Board of India (SEBI)  issued  a show cause notice to ABFL as the regulator was investigating the NBFC’s dubious role in structuring and disbursing loans to a shell company linked to the erstwhile promoters of CG Power wherein the funds were used to transfer liabilities from the erstwhile promoter companies to the listed CG Power. The SEBI show cause notice cited by ET Prime specifically mentioned the role played by Ajay Srinivasan  (non-executive director, ABFL and group CEO, ABC) and Devang Rawal (then Head – Corporate Finance and subsequently promoted as Head – Corporate and Institutional, ABFL).

Interestingly, ABFL is led by two CEOs, Rakesh Singh (Managing Director and CEO, ABFL) and Tushar Shah (CEO for infrastructure business) and all the five individuals who have resigned reported to the former. Incidentally, Devang Rawal’s division which is currently being extensively investigated by SEBI also reports to Rakesh Singh.

ABC declined to respond to queries sent by this analyst to enquire why these executives had quit and whether the board of directors at ABFL and ABC, especially the independent directors were informed of their departure.

Stakeholders are concerned when there is a flurry of exits by senior executives in any firm as was seen in the recent case of AU Small Finance Bank. That such an event at ABFL coincides with agencies investigating dodgy deals at a NBFC belonging to a prestigious industrial house should send alarm bells ringing.


Sudarshan Chemical: Anti-Dumping on Mica to Aid Earnings by 5-10%

By ICICI Securities Limited

Anti-dumping duty on mica pigment: The Finance Ministry has imposed antidumping duty on natural mica-based pearl industrial pigments, excluding cosmeticgrade products. The duty will be ~US$2-3/kg and will be levied for five years. As per the initial document filed by the company, overall import volumes for mica pigment from key geographies is at ~2181 MT at an imported price of Rs 380/kg. The price undercutting is estimated to be ~20-30% as on inquiry date. Mica pigment currently contributes in low single digits to overall revenue of Sudarshan Chemical. Based on our calculation, sales volumes should be ~1300 MT against total capacity of ~3000 MT as per the pre-feasibility study report filed earlier.

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Vinati Organics: Quarterly Highlights

By CD Equisearch

Driven by an uptick in end-user industries and a strong traction from ATBS segment on account of pent-up up demand, VOL’s Q1FY22 revenue from operations leapt by an enthusing 38.1% to Rs. 386.37 cr from Rs….

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DCB Bank: Valuations Attractive!

By Axis Direct

We initiate coverage on DCB Bank (DCB) with a BUY recommendation and a Target Price of Rs 115/share implying an upside of 24% from CMP.

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APL Apollo Tubes (APAT) is the largest manufacturer of Structural Steel Tubes in India

By Motilal Oswal

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Bharti Airtel: Rights Issue to Meet Accelerated Investments

By ICICI Securities Limited

Bharti Airtel (Airtel) announced that its board has approved raising up to Rs 21,000 crore via rights issue at Rs 535 per share, with rights entitlement ratio at one equity share for every 14 equity shares held, implying equity dilution of ~7%. Terms of payment: Issue price will be 25% on application and balance in two more additional calls within 36 months The promoter & promoter group will collectively subscribe to the full extent…

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India: HDFC Standard Life Insurance, CreditAccess Grameen Ltd, Easy Trip Planners Ltd, Nocil Ltd and more

By | Daily Briefs, India

In today’s briefing:

  • HDFC Life announces 100
    % acquisition in Exide Life
  • CreditAccess Grameen: Business Momentum and Collections Improve MoM
  • Easy Trip Planners: Digital Play on Travel Recovery
  • Pick of the Week: NOCIL Limited

HDFC Life announces 100
% acquisition in Exide Life

By Motilal Oswal

HDFC Life has announced the 100% acquisition of Exide Life for consideration of INR66.87b, of which INR7.26b would be paid in cash. Furthermore, the company would issue 87m shares to Exide Industries Limited towards the balance amount at INR685 per share. HDFC Life expects to secure all the approvals and complete the transaction by 30th Jun’22. In FY21, Exide Life earned a total premium of INR33.25b (8.6% that of HDFC Life), and total AUM stood at INR187.8b (10.4% that of HDFC Life).

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CreditAccess Grameen: Business Momentum and Collections Improve MoM

By Axis Direct

We value CAG at 2.5x FY23E BV and believe that our target multiple reflects the superior return profile (achieving ~16% ROE by FY23E and improving thereafter) and the inherent risks in the MFI business.

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Easy Trip Planners: Digital Play on Travel Recovery

By ICICI Securities Limited

Easy Trip Planners or EaseMyTrip.com (EMT) is the fastest growing and only profitable company in the online travel portal in India. It was founded as a B2B2C portal in 2008, providing travel agents access to its website to book domestic travel airline tickets. Subsequently, the company diversified into the business to customer (B2C) distribution channel in 2011.

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Pick of the Week: NOCIL Limited

By Axis Direct

NOCIL Limited, part of the Arvind Mafatlal Group, is the largest rubber chemicals company in India. The company has manufacturing units in Navi Mumbai, Maharashtra and Dahej, Gujarat. It portfolio includes accelerators, anti-oxidants, pre/post vulcanization products. The products manufactured are used by the tyre industry and other rubber processing industries

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India: Adani Ports & Special Economic Zone, Exide Industries, Gail India, L&T Technology Services Limited, Nazara Technologies, Shree Cement, TVS Motor and more

By | Daily Briefs, India

In today’s briefing:

  • Adani Ports & SEZ: Integrated Play to Transform Indian Logistics Sector
  • Exide Industries: Superior Product Mix and Cost Optimization
  • Pick of the Week – GAIL India
  • L&T Technology: Strong Outlook; Expensive Valuations
  • Nazara Technologies: Game On!
  • Shree Cement: Capacity Expansion, Product Mix and New Markets To Drive Growth
  • TVS Motor: Revival in Growth Expected in Second Half.

Adani Ports & SEZ: Integrated Play to Transform Indian Logistics Sector

By ICICI Securities Limited

Adani Ports and Special Economic Zone (APSEZ) is the largest commercial port operator with 25% share of India’s port cargo movement. The company has evolved from a single port dealing in a single commodity to an integrated logistics platform.

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Exide Industries: Superior Product Mix and Cost Optimization

By Geojit BNP Paribas

Exide Industries Limited (EIL) is a leader in storage battery business with a market share of 60% in India. Its segment includes automotive & industrial batteries and holds 86% market share in the 2W space. Q1FY22 revenue grew by 61% YoY primarily due to lower base and strong growth from the Aftermarket & UPS segment. As a result, EBITDA margin expanded by 90bps YoY.

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Pick of the Week – GAIL India

By Edelweiss

GAIL is a dominant player in India involved in business of sourcing, transportation, distribution, and processing of natural gas in India. The company owns >11,000 kms of natural gas pipelines. 

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L&T Technology: Strong Outlook; Expensive Valuations

By Axis Direct

We recommend a HOLD and assign a 35x P/E multiple to its FY23E earnings of Rs 124/share, which gives a TP of Rs 4,290/share indicating potential upside of 6%.

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Nazara Technologies: Game On!

By Prabhudas Lilladhar

We initiate coverage on Nazara Technologies with a ‘BUY’ rating as it 1) is a unique play on rising gaming culture, given Gen Z & millennials constitute ~65% of India’s population demographics 2) has an early mover advantage in evolving Esports category (organized 82% unique Esports events with 73% share in total prize pool as of 2019),that is likely to disrupt traditional sports landscape in next 4-5 years and 3) offers a direct play on emerging Ed-Tech market via Kiddopia.

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Shree Cement: Capacity Expansion, Product Mix and New Markets To Drive Growth

By Axis Direct

Shree Cement Ltd (SCL) commissioned a new 3 million tonnes per annum (mtpa) cement unit in Cuttack, taking the total capacity to 43.4 mtpa. Its 3 mtpa new grinding capacity is coming up in Patas, near Pune and is expected to be operational in Q2FY22. With this capacity addition, SCL’s total cement grinding capacity will increase to 46.4 mtpa on a standalone basis.

We value SCL at 19x FY23E EV/EBITDA and assign a HOLD rating to the company.

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TVS Motor: Revival in Growth Expected in Second Half.

By Geojit BNP Paribas

Revival in growth expected in second half. TVS Motors (TVS) is the third largest two-wheeler manufacturer in India with a domestic market share of 14.3% in FY21. Q1FY22 revenue came lower at 26% QoQ due to pandemic related disruption, leading to supply constraints, lower utilization and thus negative operating leverage. Despite adverse commodity price, Strong cost control initiatives…

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