India

• The review period for the price cutoff for the MSCI May Quarterly Comprehensive Index Review (QCIR) ended 28 April. MSCI should select a day from week one.
• The most changes are expected in China and there are a couple of stocks that could trigger the Extreme Price Increase thresholds.
• Some stocks appear on the list of potential changes on certain days during the review period and their addition/deletion will depend on the day that MSCI chooses for computation.

• Nexus Select Trust (NST IN), a consumption centre REIT, is seeking to raise up to Rs32 billion (US$391 million). The offer opens from 9-11 May. 
• NST, sponsored by Blackstone Group (BX US), owns India’s most extensive portfolio of consumption centres and will be the first publicly listed consumption centre REIT in India.
• The key elements of the investment case rest on strong portfolio performance, high occupancy rates, favourable lease contracts, rental reversion potential and low tenant concentration risk.

• Radico Khaitan (RDCK IN) had succeeded in getting de-leveraged to a strong extent,  as mentioned in our previous insight, Radico Khaitan Limited: On the Path of Getting Debt Free 
• The company has entered into the new capex phase and has accumulated some debt, the annual report F22 also highlights few irregularities on the forensic side.
• These include complex structure for land purchase, receivables provisioning, deviation between RoU and lease assets, etc. 

• Voltas Ltd (VOLT IN) has experienced a decline in revenue due to a slowdown in demand, increased competition, and higher commodity prices. 
• The Voltas Beko brand has been a ray of hope for the company, with strong growth in demand and market share.
• While there may be an upside in volumes as capex kicks in,  but better to be on the sidelines until there is a change in the structure of the industry.

• Bajaj Auto Ltd (BJAUT IN) is optimistic about the future of their exports and expects a recovery in exports as a critical catalyst for the stock over the near term.
• The company’s EV endeavors in both 2-wheelers and 3-wheelers are expected to surprise on the upside, which can deliver upside than what is currently factored in.
• The stock also trades at undemanding valuations (16x FY25 consensus estimates), offering adequate comfort with an optionality of EV and Exports.

• Torrent Pharmaceuticals (TRP IN) continues to report double-digit revenue growth from India business. Leadership positioning in chronic therapeutic areas underpinned by Curatio acquisition is driving the domestic business.
• The company expects the India business to continue its growth momentum, backed by new launch, top brand performance, increase in field force productivity, and continued performance of Curatio portfolio.
• The U.S. business also witnessed revival in FY23 after a downturn in FY22, which should provide impetus to the company’s bottom line to a great extent.

• Strong demand for Eicher Motors (EIM IN) ‘s Royal Enfield bikes with returning customers.
• The model “Hunter” is expanding the market and attracting a new set of customers.
• Royal Enfield entering a new growth phase with new launches and customer service focus.

• Foreign shareholding has dropped in HDFC Limited and increased in HDFC Bank – the net effect is an increase in foreign room to just north of 18%.
• The merger is expected to complete in Q2/Q3 when there will be buying from MSCI trackers. There will be adhoc inclusions to the NIFTY, Nifty Next 50 and SENSEX indices.
• HDFC Limited (HDFC IN) trades 1.39% below the merger ratio with HDFC Bank (HDFCB IN) and also at a lower price to book.

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.

• Country Garden Holdings Co
• Tata Motors ADR
• Xiaomi Corp

• Mankind Pharma (6596876Z IN) is looking to raise up to US$526m in its IPO by selling 40.06m shares at a price range of INR 1026 to INR 1080 per share.
• The company has allocated 12.02m shares to anchor investors at INR 1080/share. That list includes marquee names and the lock-up reduces near-term float.
• The IPO opens on 25 April and will close on 27 April. Shares are expected to start trading on 9 May and there are no near-term index inclusions expected.

Lucror Analytics’ ESG Scores are based on a 3-tiered scale and are adjusted for Controversies (if applicable).
We view Tata Steel’s ESG as “Adequate”, in line with the “Adequate” Social and Governance pillars. The company has a “Strong” Environmental score. Controversies are “Immaterial” and Disclosure is “Adequate”.

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.

• Adani Ports & Special Economic Zone
• Hopson Development
• Vedanta Resources

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.

• Reliance Industries
• Sunac China Holdings

• HDFC Bank (HDFCB IN) reported a steady and broadly in-line-with-expected Q4FY23 earnings. In particular, its growth in deposits at 8.7% QoQ was commendable.
• Advances also grew at a healthy pace of 6% QoQ. Retail advances grew 5% QoQ, while CRB (Commercial and Rural Banking) grew the most at 9.7% QoQ.
• Aided by low credit costs, HDFCB continues to invest in expanding its geographical and digital distribution to deepen its penetration.

• Mankind Pharma (6596876Z IN)‘s IPO is lined up to be open for subscription next week.
• Mankind is one of the largest pharmaceutical formulation player in India. The company is a market leader in condoms, pregnancy test kits, emergency contraceptives category, etc.
• However, when it comes to the balance sheet, there are several aspects that warrant attention. These include acquisitions, asset quality, non-comparable return ratios owing to accounting treatment, etc.

• Mankind Pharma (6596876Z IN), a pharmaceutical company, is seeking to raise up to Rs43.3 billion (US$527 million) at Rs1,026-1,080 per share. The public offer runs from 25-27 April.
• We previously discussed the IPO in Mankind Pharma IPO: The Bull Case, Mankind Pharma IPO: The Bear Case and Mankind Pharma IPO: Updates Warrant Caution. 
• Our valuation analysis suggests that Mankind Pharma is fully valued at the IPO price range. Therefore, we are inclined to pass on this IPO.