India: Delhivery, Campus Activewear Ltd, Tata Steel Ltd, Equitas Small Finance Bank , Security and Intelligence Services (India) Limited and more

• Delhivery (1058656D IN) is looking at raising INR 52,350m (US$685m) in its IPO by selling up to 113.3m shares at a range of INR 462-487/share.
• At the mid point of the IPO range, Delhivery (1058656D IN) will be valued at INR 344.8bn (US$4.5bn) while the free float market cap will be much lower.
• Delhivery (1058656D IN) could get entry to the FTSE All-World Index at the December QIR, while inclusion in the MSCI India Index could take place at the May 2023 SAIR.

• Delhivery is now looking to raise around US$700m in its upcoming India IPO, the company is backed by a host of financial investors, the largest being Softbank
• Delhivery is an online logistics service provider which covers express parcel delivery, heavy goods delivery, part truckload (PTL) freight, truckload (TL) freight, supply chain solutions, cross border solutions etc.
• We have covered various aspects of the deal in our earlier notes. In this note, we talk about valuation. 

• Campus Activewear Ltd (1535013D IN) India IPO raised around US$184m. The IPO was a 100% secondary selldown.
• The overall subscription rate for Campus had led the likes of Zomato, PAYTM and PB Fintech, and was most similar to that of Polycab India.
• Campus’ growth outlook and vertically integrated model should warrant it to trade at a premium to Metro Brands, while at a discount to Relaxo, given the latter’s more diversified offering. 

Tata Steel’s Q4 and FY 2021-22 results were exceptionally strong, with revenue surging and EBITDA doubling. The company paid down a large amount of debt during the year, significantly above the guided figure. The financial risk profile improved substantially on the back of increased earnings and lower debt, and appears in line with the BBB level. Liquidity is sound.

We revise our LARA assessment to “Low Risk” from “Medium Risk”. Tata Steel has delivered outstanding results in recent years, with significant deleveraging and strong earnings growth. This has resulted in a substantial boost to its credit profile. We view favourably the company’s track record of delivering on guidance, especially in terms of deleveraging.

• Equitas Small Finance Bank Ltd. (EQSFB) results were a mixed bag. While growth on the asset and liability side was encouraging and Opex growth was modest at 10% YoY thereby supporting operating profit, higher than expected provisions weighed on the bottom line.
• Disbursements stood at Rs 3,279 Cr (+29% YoY,+21% QoQ)aiding loan growth revival.
• We believe current valuations of 1.3x FY24E ABV are attractive and thus maintain our BUY rating on the stock with a target price of Rs 77 (1.9x FY24E ABV), implying an upside of 43% from the CMP.

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.

• SIS reported moderate growth in Q4FY22 with Revenue at Rs 2,648 Cr, registering an encouraging growth of 1.8% QoQ, (below our expectations).
• Consolidated EBITDA for the quarter de-grew by 4.1% QoQ to Rs 124 Cr, owing to tepid international business
• We recommend a BUY rating on the stock and assign a 21x P/E multiple to its FY24E earnings of Rs 28.4/share which gives a TP of Rs 590/share, implying an upside of 13% from the CMP.

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.