In today’s briefing:
- Zomato/Eternal: The BIG Passive Selling Starts
- AVTL: Storage Platform Poised for Growth Amid Demand Visibility
- Ashok Leyland(AL IN)-Robust Growth ; Value Unlocking from Subsidiary Ahead
- Aegis Vopak Pre-IPO: Expensive Related to Peers
- NALCO (NACL IN): Record FY25 Profit; Alumina-Led Fall Likely Priced In, Execution Remains Key Risk
Zomato/Eternal: The BIG Passive Selling Starts
- Following shareholder approval of the proposal to reduce the Foreign Ownership Limit from 100% to 49.5%, NSDL has updated the FOL. This starts the process of passive selling in Zomato.
- Passives will sell US$350m at the close on Tuesday. There is a low probability of more selling later in the week. There will be bigger selling in August.
- The size of the selling in August and beyond will depend on what foreign investors do in the stock till the end of June. Watch the red flag/ breach list.
AVTL: Storage Platform Poised for Growth Amid Demand Visibility
- Aegis Vopak Terminals is raising Rs2,800 crore via a fresh issue to repay debt and fund expansion, marking its transition into a listed infrastructure platform.
- LPG capacity is set to triple by FY26, with new industrial terminals planned under a Rs4,500 crore capex; revenue and EBITDA are projected to grow 20–25% CAGR through FY27.
- Key risks include high dependence on group entities for revenue, delayed utilization of new capacity, and exposure to regulatory or energy demand shifts affecting LPG and chemical flows.
Ashok Leyland(AL IN)-Robust Growth ; Value Unlocking from Subsidiary Ahead
- Ashok Leyland (AL IN) posted 38% YoY PAT growth in Q4, driven by cost efficiency, premium product mix, and strong EBITDA margin improvement.
- HLF IPO and Switch India’s PAT target for FY26 positions for significant value unlocking and improved subsidiary contribution.
- CV demand, export momentum, and alt-fuel investments support a strong FY26 outlook, with valuations supported by improving profitability and resilient balance sheet. 4o
Aegis Vopak Pre-IPO: Expensive Related to Peers
- Aegis Vopak Terminals Ltd (1902844D IN) is looking to raise about US$328m in its upcoming India IPO.
- It is the largest Indian third-party owner and operator (in terms of storage capacity) of tank storage terminals for liquified petroleum gas (LPG) and liquid products.
- In this note, we look at the firm’s recent financial performance updates, as well as its potential valuation.
NALCO (NACL IN): Record FY25 Profit; Alumina-Led Fall Likely Priced In, Execution Remains Key Risk
- NALCO has guided for alumina realizations around $400/t in FY26, with earnings further impacted by delays in ramp-up of its 1 MTPA alumina expansion project.
- Q4 FY25 results were strong, but earnings outlook has weakened significantly with the steep drop in alumina prices.
- Valuations appear inexpensive on FY27 earnings at 5x EV/EBITDA, however peristent delays in capacity rampup is concerning.
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