In today’s briefing:
- Bajaj Finance (BAF): Robust Growth in Place
- Central Banks Hold Steady Amid Global Economic Uncertainty
- Link REIT (823 HK)
- Asia Real Estate Tracker (20-Mar-2025): Digital Realty enters Indonesia market with Bersama.
- EAAA India Pre-IPO – Quality Management Fee Stream but Future AUM Raising Could Be Difficult
- H&T (HAT) – 2024 results: reasons to be cheerful 1, 2, 3, 4 and 5
Bajaj Finance (BAF): Robust Growth in Place
- Bajaj Finance Ltd (“BAF”) reported a strong Q3FY25 led by good volume growth and AUM growth. It saw highest ever new loans at 12.06mm. AUM growth was INR 24119cr.
- Despite elevated credit costs for peers, BAF has been relatively insulated and reported steady asset quality. ROA and Opex were also steady at around 4.5% and 33%, respectively.
- In line with BAF’s long-range strategy, BAF is increasingly adopting AI to improve productivity. As part of this, BAF unveiled a BFL 3.0 FINAI company.
Central Banks Hold Steady Amid Global Economic Uncertainty
- Central banks globally are making rate decisions, with the Fed holding steady while Sweden, Switzerland, Taiwan, and the UK announce their decisions today.
- Mexico and Canada are central banks to watch, with Fitch forecasting both economies to enter recession in 2025 due to their high US trade exposure.
- The US’s global reciprocal tariffs, set to be revealed on April 2, have significant implications for the global economy, with the potential to influence central bank policies worldwide.
Link REIT (823 HK)
- The largest REIT in Asia, with enough liquidity for most funds. Has a great set of neighborhood malls across Hong Kong enjoying recurring income from food & beverage, restaurants, etc
- Suffered during the COVID-19 pandemic but DPU has started growing again. Rights issue a misstep but the leverage is now acceptable. New Blackrock CIO bodes well for M&A.
- REIT trades at 7% yield vs 4% historically. Essentially an interest rate bet. Will probably be included in the Stock Connect program soon, expect an announcement on 19 April.
Asia Real Estate Tracker (20-Mar-2025): Digital Realty enters Indonesia market with Bersama.
- Digital Realty partners with Bersama to enter Indonesia’s data center market, expanding their global presence in the industry.
- Leading firms KKR, Gaw, and Alyssa highlight favorable macroeconomic factors driving growth in Japan’s multi-family sector on MTD TV.
- Singapore’s largest REIT, CapitaLand, undergoes a leadership reshuffle with the appointment of a new CEO to drive strategic initiatives.
EAAA India Pre-IPO – Quality Management Fee Stream but Future AUM Raising Could Be Difficult
- EAAA India Alternatives Ltd (1619210D IN) is planning to raise about US$177m through its upcoming India IPO.
- It is one of the leading alternatives platforms in India, with AUM of INR 572.62bn (US$6.63bn), as of 9M24, amassing 15 years of experience.
- In this note, we look at the firm’s past performance.
H&T (HAT) – 2024 results: reasons to be cheerful 1, 2, 3, 4 and 5
- H&T’s 2024 results were reassuringly in line with expectations, delivering 10% PBT growth, with the pledge book capital value up 26%, retail sales up 27% and forex profits up 11%.
- The outlook remains positive, with i) strong demand in the core pawnbroking business where H&T is taking share and may have increasing acquisition opportunities, ii) consumer trends favouring its multi-channel, value-for-money, new and used product retail offering, iii) an expanding range of currencies helping forex growth, iv) a continued high gold price, and v) growth in store numbers helping all product lines.
- Economies of increasing scale will help mitigate cost growth that is outside management control.
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