Shriram Transport’s 1QFY15 PAT declined 10% YoY and (up 4% QoQ to INR3b (In line). Moderation in AUM growth (+4% YoY to INR544b), decline in disbursements (7% YoY), and improvement in margins (10bp QoQ) are key highlights of the quarter; buy.
Union bank reported profit growth of 15.4% largely due to lower provisions and Narnolia Securities Limited value bank at Rs.152/share which is 0.5 times of FY14E’s book contingencies led by lower slippage and restructure assets value.
Bank of Baroda reports NII of Rs3328.3 cr, up 15.2% y-o-y in Q1FY15 - HDFC SecIndiaNotes.com
- Bank of Baroda reported a 15.2% year-over-year increase in net interest income and a 16.6% year-over-year increase in net profits for Q1FY15.
- Non-performing assets increased slightly both sequentially and year-over-year, while restructured loans declined sequentially.
- Cost-to-income ratio increased to 43.1%, remaining a concern, while provisions declined due to write-backs on investments.
Hindustan Media Q1FY15: Strong advertising as well as circulation growth, BuyIndiaNotes.com
During the quarter, the company's revenue grew 16.5% YoY to INR2.1b (est INR2.02b). Advertising revenue grew 17% YoY to INR1.56b (est INR1.5b) largely led by yield improvement. Circulation revenue grew 17% YoY to INR493m (est INR458m). Buy
Crompton Greaves 3QFY15 performance remains a mixed bag; buyIndiaNotes.com
- Crompton Greaves' standalone business reported stable results for 3QFY15, with revenues down slightly and margins flat. However, the overseas business slipped to an operating loss due to legacy order costs.
- Total revenues were down 1.5% for standalone but up 8.4% in Euros for overseas. The overseas business reported an operating loss due to costs from executing a legacy order.
- Motilal Oswal maintains a "Buy" rating but cuts earnings estimates due to delays in overseas business turnaround. They forecast stronger standalone growth over the next two years despite near-term margin pressures.
Axis Bank Q1FY15: NIMs largely stable; BuyIndiaNotes.com
In Q1FY15, Axis posted NII of Rs 3310.5 cr, up 15.5% yoy and 4.6% qoq. NIMs have been stable at 3.88%. Growth in loans was sustained at 16.3% with momentum in the retail advances keeping up. Fee income growth was muted. Buy at CMP and add on dips.
LIC Housing Finance Q1FY15: Buy for a target of Rs332IndiaNotes.com
LICHFL’s Q1FY15 results were below our estimates due to lower than expected NIMs (due to high cost of borrowings), higher other operating expenses (substantial rise in advertising cost) & higher taxes [due to Deffered Tax Liability impact].
IndusInd Bank delivers strong set of numbers in Q4; AccumulateIndiaNotes.com
Indusind Bank Ltd. reported strong quarterly results for the quarter ending March 2015, with healthy growth in advances, net interest income, and profit after tax. Asset quality improved slightly with gross non-performing assets declining to 0.8% from 1.0% in the previous quarter. The bank expects further improvement in asset quality and margins going forward as the business mix shifts toward retail lending and CASAs increase. The analyst maintains an 'Accumulate' rating and raises the target price to Rs. 960 based on positive fundamentals and growth prospects.
Union bank reported profit growth of 15.4% largely due to lower provisions and Narnolia Securities Limited value bank at Rs.152/share which is 0.5 times of FY14E’s book contingencies led by lower slippage and restructure assets value.
Bank of Baroda reports NII of Rs3328.3 cr, up 15.2% y-o-y in Q1FY15 - HDFC SecIndiaNotes.com
- Bank of Baroda reported a 15.2% year-over-year increase in net interest income and a 16.6% year-over-year increase in net profits for Q1FY15.
- Non-performing assets increased slightly both sequentially and year-over-year, while restructured loans declined sequentially.
- Cost-to-income ratio increased to 43.1%, remaining a concern, while provisions declined due to write-backs on investments.
Hindustan Media Q1FY15: Strong advertising as well as circulation growth, BuyIndiaNotes.com
During the quarter, the company's revenue grew 16.5% YoY to INR2.1b (est INR2.02b). Advertising revenue grew 17% YoY to INR1.56b (est INR1.5b) largely led by yield improvement. Circulation revenue grew 17% YoY to INR493m (est INR458m). Buy
Crompton Greaves 3QFY15 performance remains a mixed bag; buyIndiaNotes.com
- Crompton Greaves' standalone business reported stable results for 3QFY15, with revenues down slightly and margins flat. However, the overseas business slipped to an operating loss due to legacy order costs.
- Total revenues were down 1.5% for standalone but up 8.4% in Euros for overseas. The overseas business reported an operating loss due to costs from executing a legacy order.
- Motilal Oswal maintains a "Buy" rating but cuts earnings estimates due to delays in overseas business turnaround. They forecast stronger standalone growth over the next two years despite near-term margin pressures.
Axis Bank Q1FY15: NIMs largely stable; BuyIndiaNotes.com
In Q1FY15, Axis posted NII of Rs 3310.5 cr, up 15.5% yoy and 4.6% qoq. NIMs have been stable at 3.88%. Growth in loans was sustained at 16.3% with momentum in the retail advances keeping up. Fee income growth was muted. Buy at CMP and add on dips.
LIC Housing Finance Q1FY15: Buy for a target of Rs332IndiaNotes.com
LICHFL’s Q1FY15 results were below our estimates due to lower than expected NIMs (due to high cost of borrowings), higher other operating expenses (substantial rise in advertising cost) & higher taxes [due to Deffered Tax Liability impact].
IndusInd Bank delivers strong set of numbers in Q4; AccumulateIndiaNotes.com
Indusind Bank Ltd. reported strong quarterly results for the quarter ending March 2015, with healthy growth in advances, net interest income, and profit after tax. Asset quality improved slightly with gross non-performing assets declining to 0.8% from 1.0% in the previous quarter. The bank expects further improvement in asset quality and margins going forward as the business mix shifts toward retail lending and CASAs increase. The analyst maintains an 'Accumulate' rating and raises the target price to Rs. 960 based on positive fundamentals and growth prospects.
HDFC Bank result update: Q4FY15 PAT up 21% YoY, Motilal Oswal maintains 'Buy'IndiaNotes.com
- HDFC Bank reported a 21% year-over-year increase in net profit for the fourth quarter of fiscal year 2015, in line with estimates. Strong growth in fee income and stable net interest margins contributed to results.
- Asset quality improved with gross NPAs declining 7 basis points sequentially to 0.93% and restructured loans stable at 0.1% of total loans.
- Loan growth was driven by strong performance in wholesale lending while retail loans grew at a slower pace, with commercial vehicles and construction equipment declining.
- The bank added over 350 branches during the quarter and plans to continue expanding its network.
ICICI Prudential Growth Fund - Series 1 (Presentation)iciciprumf
This document provides an overview of the ICICI Prudential Growth Fund - Series 1, a close-ended equity fund. The fund aims to provide capital appreciation by investing in 40-60 stocks across market caps with a focus on mid and small caps as well as infrastructure and banking. It will identify companies with potential earnings growth over 3 years. The fund follows a high conviction approach and conducts rigorous research and risk management. It aims to outperform the CNX Nifty Index over the long run through investing in quality companies with strong fundamentals and earnings growth potential. Investors should be aware that the principal investment is of high risk.
Asset quality was better among peers but in tight liquidity situation it would remain challenging. Margin was compressed slightly in sequential basis but management continued to guided domestic NIM at 3% level from present of 2.95%. NSL value bank at Rs.634/share which is 0.75 times of FY14E’s book value.
Narnolia Securities Limited positive to buy stocks of Escorts Ltd in current level with Revised price target of Rs. 175. For more information about stock market tips, contact here http://www.narnolia.com/index.php/contact-us/
Marico reported a 10% sales growth led by 3% volume growth for Q3FY14, beating estimates. However, margins were not comparable to last year due to a change in depreciation method. While profit grew 31% due to cost rationalization, slower volume growth is expected to continue in the near term due to a weak demand environment. The company maintained its market share but volume growth of key brands like Parachute declined. Margins improved to 18.7% due to cost control. However, the report downgrades the stock to "Neutral" given expectations of ongoing challenges in the demand environment and slower volume growth over the next 1-2 quarters.
JMFL is one of the leading asset reconstruction company. Our aim is to manage and to make profit to those assets which have been underperforming or become formally classified as NPA’s. To know how to generate sufficient revenue, do visit our website. Know more - https://www.jmfl.com/what-we-do/fund-based-activities/asset-reconstruction
Zee Entertainment Enterprises: Good quarter; near-term outlook weak - Prabhud...IndiaNotes.com
- Zee Entertainment reported quarterly earnings above estimates driven by higher revenues and margins. Advertising revenues grew 21.5% year-over-year outpacing industry growth.
- While near-term outlook is weak due to delays in implementation of television digitization, the company expects industry advertising growth to remain in the double digits for the full fiscal year.
- The report maintains a "Buy" rating for Zee Entertainment, seeing the benefits of digitization being realized in the long-run through consistent earnings growth and a strong balance sheet.
Tata Motors stock at its CMP of Rs 364 is trading at 7.34 x of one year forward FY14E EPS of Rs50.The robust 3QFY14 results, Strong cash flows by JLR and better demand outlook, Narnolia Securities limited Maintain BUY for the stock with Target Price Rs 425
This document discusses the DSP India T.I.G.E.R. Fund, which aims to capture growth from India's investment cycle revival and economic reforms. It focuses on sectors related to infrastructure growth and economic reforms like construction, cement, manufacturing, and autos. The document outlines reasons for recommending the fund, such as signs the investment cycle has bottomed out and capacity utilization rising. It also discusses the government's push for capex spending and various reforms that have been implemented in India to support the investment theme. Key data points are presented to track the building capex cycle in India.
The Sodhani Committee made several recommendations to promote NRI investments in India and widen the foreign exchange market:
1) It recommended merging the 40% and 100% schemes for NRI investments and allowing 100% repatriation for more eligible companies without prior permission.
2) It recommended granting banks the power to provide housing loans to NRIs.
3) It recommended allowing unrestricted investments by NRIs in real estate, sick units, and educational institutions.
4) It recommended expanding the foreign exchange market by including more participants like IDBI and ICICI and making RBI interventions more selective.
The RBI accepted most of these recommendations by amending various regulations and
At the CMP of Rs 33, the stock is trading at an Adj P/BV of 1.3x and 1.1x for FY15E and FY16E, respectively. With the new government stepping-up reforms and making efforts to remove the bottlenecks in the economy, we expect the economic growth to pick up going forward. Consequently, we expect the strong growth momentum seen in SIB over past few years to continue. We expect advances and deposits to grow at a CAGR of ~19% each over the forecasted period of FY14-16E.
With business further expected to grow at CAGR of 19.5% over FY14-16E; NIMs remaining stable at ~3.0% and cost-to-income ratio improving to ~45% (currently ~50%), we expect a robust PAT growth of 22.6% CAGR over FY14-16E to Rs 763 crore.
Asset quality of SIB has improved in FY14 with GNPA and Net NPA standing at 1.2% and 0.8% in FY14 against 1.4% and 0.8% in FY13, respectively (which compares favourably with peers).
On the capital adequacy front, SIB is comfortably placed to support the future business needs of the bank over the period FY14-16E. The management has stated that it does not require any Tier-I capital funding during the current year. However, it plans to raise Tier-II capital of Rs 200 crore in FY15 to fund future growth.
Bangladesh Private Commercial Banks Quarterly Overview - November 2011The Growth Institute
The operating profits of Bangladesh's private commercial banks declined in the third quarter due to falling stock prices, rising costs, and lower returns on investment. Several factors negatively impacted bank earnings, including high fiscal deficits, currency depreciation, inflation, and increased government borrowing which constrained loan growth. Investment income also fell significantly due to the plunging stock market. While commission income provided some relief, overall most banks saw declines in net interest income. Looking ahead, interest income is expected to fall further and banks will realize losses from marked-to-market adjustments to stock holdings. Continued high government borrowing and regulatory limits on lending are also likely to constrain loan growth.
The document summarizes market performance and provides analysis of company earnings results and previews. It reports that:
- Key Indian indices fell 1.1% as Asian markets were weak and some companies reported lower than expected earnings.
- Company result reviews showed Asian Paints grew 5% but missed estimates, Union Bank profit fell 49.6% below estimates due to high provisions, and Dabur grew 15% in line with estimates.
- Previews suggest ONGC may report 24.7% revenue growth and Cairn India 346.5% revenue growth from higher oil production and prices.
The Indian pharmaceutical sector is highly fragmented, with over 20,000 registered companies. The top 250 companies control 70% of the market. These companies currently meet about 70% of the country's drug demands, mainly through Maharashtra and Gujarat, which account for 45% of pharmaceutical manufacturing units.
The industry has grown from $0.3 billion in 1980 to $12 billion in 2012. Branded generics dominate the market, making up 70-80% of it. Drug prices are very low due to intense competition. While India is 10th globally by value of drugs, it is 3rd by volume produced.
This document provides financial information about Square Pharmaceuticals Limited, including:
1. Key financial ratios from 2009-2010 to 2011-2012 showing the company has satisfactory current, quick, and debt ratios compared to industry averages.
2. Calculations for enterprise value, equity value, and value per share of Tk 232.51 based on historical income statements, balance sheets, and share prices from 2006-2012.
3. Assumptions made in forecasting the company's financial statements from 2012-2013 to 2014-2015 and calculating weighted average cost of capital.
Analysis of Financial Statement of SNGCMaaz HaCeeb
Analysis of Financial Statement of SNGC to determined the financial position of the company and also compared it with their previous year whether company progress increases or decreases
TCS’ 1QFY15 revenue grew 5.5% QoQ to USD3.6b (and 4.8% QoQ CC), in line with estimate. EBITDA margin declined 210bp QoQ to 28.8%, v/s estimate of 29.2%. EBIT margin (26.3%) was lower than est. (27.6%) due to a one-time depreciation charge.
The Tarapore Committee report provided a roadmap for moving India towards full capital account convertibility over three phases from 2006-2011. It recommended preconditions like limiting fiscal deficits and inflation, and suggested increasing limits on investments abroad for residents and limits on investments in India for foreigners over the phases. The report aimed to balance monetary policy independence, an open capital account, and managing exchange rates under the impossible trinity framework.
Infosys largely reported inline set of sales numbers. We retain our BUY view on the stock with a target price of target price of Rs 3910 as well as neutral view on the stock of Indusind bank. Also private Bank result preview 3QFY14 in this Pdf.
ING Vysya Bank: Sharp deterioration in asset quality impacts NIM in Q1FY15IndiaNotes.com
ING Vysya Bank’s PAT declined 18% YoY to ~INR1.4b (22% below est.). Sharp deterioration in asset quality not only impacted NIMs (negative impact of 15bp) but also led to higher provisioning of INR1b (61% above estimate). Estimated downgraded, maintain buy.
Q4FY14 Result: Bajaj Finance continues to reap the benefits of healthy consum...IndiaNotes.com
Bajaj Finance (BAF) reported a 11% year-over-year increase in 4QFY14 profit at INR1.82 billion, which was below estimates due to a decline in net interest margins from shifting loan mix to lower-yielding mortgages and higher operating expenses from ongoing investments in new business lines. Asset quality remained healthy with non-performing assets stable at 1.18% despite a corporate loan slippage. The report maintains a "Buy" rating with a target price of INR2,018, but reduces FY15/16 earnings estimates by 5-6% to factor lower margins and higher costs from the loan mix shift and investments.
HDFC Bank result update: Q4FY15 PAT up 21% YoY, Motilal Oswal maintains 'Buy'IndiaNotes.com
- HDFC Bank reported a 21% year-over-year increase in net profit for the fourth quarter of fiscal year 2015, in line with estimates. Strong growth in fee income and stable net interest margins contributed to results.
- Asset quality improved with gross NPAs declining 7 basis points sequentially to 0.93% and restructured loans stable at 0.1% of total loans.
- Loan growth was driven by strong performance in wholesale lending while retail loans grew at a slower pace, with commercial vehicles and construction equipment declining.
- The bank added over 350 branches during the quarter and plans to continue expanding its network.
ICICI Prudential Growth Fund - Series 1 (Presentation)iciciprumf
This document provides an overview of the ICICI Prudential Growth Fund - Series 1, a close-ended equity fund. The fund aims to provide capital appreciation by investing in 40-60 stocks across market caps with a focus on mid and small caps as well as infrastructure and banking. It will identify companies with potential earnings growth over 3 years. The fund follows a high conviction approach and conducts rigorous research and risk management. It aims to outperform the CNX Nifty Index over the long run through investing in quality companies with strong fundamentals and earnings growth potential. Investors should be aware that the principal investment is of high risk.
Asset quality was better among peers but in tight liquidity situation it would remain challenging. Margin was compressed slightly in sequential basis but management continued to guided domestic NIM at 3% level from present of 2.95%. NSL value bank at Rs.634/share which is 0.75 times of FY14E’s book value.
Narnolia Securities Limited positive to buy stocks of Escorts Ltd in current level with Revised price target of Rs. 175. For more information about stock market tips, contact here http://www.narnolia.com/index.php/contact-us/
Marico reported a 10% sales growth led by 3% volume growth for Q3FY14, beating estimates. However, margins were not comparable to last year due to a change in depreciation method. While profit grew 31% due to cost rationalization, slower volume growth is expected to continue in the near term due to a weak demand environment. The company maintained its market share but volume growth of key brands like Parachute declined. Margins improved to 18.7% due to cost control. However, the report downgrades the stock to "Neutral" given expectations of ongoing challenges in the demand environment and slower volume growth over the next 1-2 quarters.
JMFL is one of the leading asset reconstruction company. Our aim is to manage and to make profit to those assets which have been underperforming or become formally classified as NPA’s. To know how to generate sufficient revenue, do visit our website. Know more - https://www.jmfl.com/what-we-do/fund-based-activities/asset-reconstruction
Zee Entertainment Enterprises: Good quarter; near-term outlook weak - Prabhud...IndiaNotes.com
- Zee Entertainment reported quarterly earnings above estimates driven by higher revenues and margins. Advertising revenues grew 21.5% year-over-year outpacing industry growth.
- While near-term outlook is weak due to delays in implementation of television digitization, the company expects industry advertising growth to remain in the double digits for the full fiscal year.
- The report maintains a "Buy" rating for Zee Entertainment, seeing the benefits of digitization being realized in the long-run through consistent earnings growth and a strong balance sheet.
Tata Motors stock at its CMP of Rs 364 is trading at 7.34 x of one year forward FY14E EPS of Rs50.The robust 3QFY14 results, Strong cash flows by JLR and better demand outlook, Narnolia Securities limited Maintain BUY for the stock with Target Price Rs 425
This document discusses the DSP India T.I.G.E.R. Fund, which aims to capture growth from India's investment cycle revival and economic reforms. It focuses on sectors related to infrastructure growth and economic reforms like construction, cement, manufacturing, and autos. The document outlines reasons for recommending the fund, such as signs the investment cycle has bottomed out and capacity utilization rising. It also discusses the government's push for capex spending and various reforms that have been implemented in India to support the investment theme. Key data points are presented to track the building capex cycle in India.
The Sodhani Committee made several recommendations to promote NRI investments in India and widen the foreign exchange market:
1) It recommended merging the 40% and 100% schemes for NRI investments and allowing 100% repatriation for more eligible companies without prior permission.
2) It recommended granting banks the power to provide housing loans to NRIs.
3) It recommended allowing unrestricted investments by NRIs in real estate, sick units, and educational institutions.
4) It recommended expanding the foreign exchange market by including more participants like IDBI and ICICI and making RBI interventions more selective.
The RBI accepted most of these recommendations by amending various regulations and
At the CMP of Rs 33, the stock is trading at an Adj P/BV of 1.3x and 1.1x for FY15E and FY16E, respectively. With the new government stepping-up reforms and making efforts to remove the bottlenecks in the economy, we expect the economic growth to pick up going forward. Consequently, we expect the strong growth momentum seen in SIB over past few years to continue. We expect advances and deposits to grow at a CAGR of ~19% each over the forecasted period of FY14-16E.
With business further expected to grow at CAGR of 19.5% over FY14-16E; NIMs remaining stable at ~3.0% and cost-to-income ratio improving to ~45% (currently ~50%), we expect a robust PAT growth of 22.6% CAGR over FY14-16E to Rs 763 crore.
Asset quality of SIB has improved in FY14 with GNPA and Net NPA standing at 1.2% and 0.8% in FY14 against 1.4% and 0.8% in FY13, respectively (which compares favourably with peers).
On the capital adequacy front, SIB is comfortably placed to support the future business needs of the bank over the period FY14-16E. The management has stated that it does not require any Tier-I capital funding during the current year. However, it plans to raise Tier-II capital of Rs 200 crore in FY15 to fund future growth.
Bangladesh Private Commercial Banks Quarterly Overview - November 2011The Growth Institute
The operating profits of Bangladesh's private commercial banks declined in the third quarter due to falling stock prices, rising costs, and lower returns on investment. Several factors negatively impacted bank earnings, including high fiscal deficits, currency depreciation, inflation, and increased government borrowing which constrained loan growth. Investment income also fell significantly due to the plunging stock market. While commission income provided some relief, overall most banks saw declines in net interest income. Looking ahead, interest income is expected to fall further and banks will realize losses from marked-to-market adjustments to stock holdings. Continued high government borrowing and regulatory limits on lending are also likely to constrain loan growth.
The document summarizes market performance and provides analysis of company earnings results and previews. It reports that:
- Key Indian indices fell 1.1% as Asian markets were weak and some companies reported lower than expected earnings.
- Company result reviews showed Asian Paints grew 5% but missed estimates, Union Bank profit fell 49.6% below estimates due to high provisions, and Dabur grew 15% in line with estimates.
- Previews suggest ONGC may report 24.7% revenue growth and Cairn India 346.5% revenue growth from higher oil production and prices.
The Indian pharmaceutical sector is highly fragmented, with over 20,000 registered companies. The top 250 companies control 70% of the market. These companies currently meet about 70% of the country's drug demands, mainly through Maharashtra and Gujarat, which account for 45% of pharmaceutical manufacturing units.
The industry has grown from $0.3 billion in 1980 to $12 billion in 2012. Branded generics dominate the market, making up 70-80% of it. Drug prices are very low due to intense competition. While India is 10th globally by value of drugs, it is 3rd by volume produced.
This document provides financial information about Square Pharmaceuticals Limited, including:
1. Key financial ratios from 2009-2010 to 2011-2012 showing the company has satisfactory current, quick, and debt ratios compared to industry averages.
2. Calculations for enterprise value, equity value, and value per share of Tk 232.51 based on historical income statements, balance sheets, and share prices from 2006-2012.
3. Assumptions made in forecasting the company's financial statements from 2012-2013 to 2014-2015 and calculating weighted average cost of capital.
Analysis of Financial Statement of SNGCMaaz HaCeeb
Analysis of Financial Statement of SNGC to determined the financial position of the company and also compared it with their previous year whether company progress increases or decreases
TCS’ 1QFY15 revenue grew 5.5% QoQ to USD3.6b (and 4.8% QoQ CC), in line with estimate. EBITDA margin declined 210bp QoQ to 28.8%, v/s estimate of 29.2%. EBIT margin (26.3%) was lower than est. (27.6%) due to a one-time depreciation charge.
The Tarapore Committee report provided a roadmap for moving India towards full capital account convertibility over three phases from 2006-2011. It recommended preconditions like limiting fiscal deficits and inflation, and suggested increasing limits on investments abroad for residents and limits on investments in India for foreigners over the phases. The report aimed to balance monetary policy independence, an open capital account, and managing exchange rates under the impossible trinity framework.
Infosys largely reported inline set of sales numbers. We retain our BUY view on the stock with a target price of target price of Rs 3910 as well as neutral view on the stock of Indusind bank. Also private Bank result preview 3QFY14 in this Pdf.
ING Vysya Bank: Sharp deterioration in asset quality impacts NIM in Q1FY15IndiaNotes.com
ING Vysya Bank’s PAT declined 18% YoY to ~INR1.4b (22% below est.). Sharp deterioration in asset quality not only impacted NIMs (negative impact of 15bp) but also led to higher provisioning of INR1b (61% above estimate). Estimated downgraded, maintain buy.
Q4FY14 Result: Bajaj Finance continues to reap the benefits of healthy consum...IndiaNotes.com
Bajaj Finance (BAF) reported a 11% year-over-year increase in 4QFY14 profit at INR1.82 billion, which was below estimates due to a decline in net interest margins from shifting loan mix to lower-yielding mortgages and higher operating expenses from ongoing investments in new business lines. Asset quality remained healthy with non-performing assets stable at 1.18% despite a corporate loan slippage. The report maintains a "Buy" rating with a target price of INR2,018, but reduces FY15/16 earnings estimates by 5-6% to factor lower margins and higher costs from the loan mix shift and investments.
Stock Recommendation: Buy Punjab National Bank on dips for a target of Rs185IndiaNotes.com
In Q3FY15, PNB continued to disappoint on asset quality front and posted an overall lackluster performance. GNPA% and NNPA% have gone up sequentially from 5.65% and 3.26% in Q2FY15 to 5.97% and 3.82% in Q3FY15. NII remains almost flat y-o-y and q-o-q at Rs 4233 cr. Profitability was up 2.5% y-o-y and 34.6% q-o-q to Rs 774.6 cr. Provisions have declined 7.7% y-o-y and 17% q-o-q to Rs 1467.8 cr. Overall loan growth is up 11.2% y-o-y to Rs 372086 cr.
Bajaj Finance reported net profit of Rs 211.4 cr (+20.3% YoY) in Q1FY15 which was above expectations primarily due to higher than expected Net Interest Income (NII). NII increased 23.2% YoY and 23.0% QoQ with increase in consumer durable segment.
Q2FY15: Hold Mahindra & Mahindra Financial Services - Nirmal BangIndiaNotes.com
M&M Financial Services reported quarterly results that were in line with expectations. While profit declined slightly year-over-year due to higher provisions, asset quality issues were arrested and loan growth improved driven by growth in pre-owned vehicles. The company's asset quality and margins showed signs of improvement due to better collections and controlled slippages. However, valuations leave limited upside, leading analysts to maintain a HOLD rating with a target price slightly above current levels.
MindTree: Rupee appreciation drags revenue growth during Q1FY15IndiaNotes.com
Onsite pricing was up 2.7%, while offshore pricing declined by 0.5%. In INR terms revenues grew at a slower rate by 2.4% QoQ impacted by rupee appreciation during the quarter. EBITDA grew by 41.5% YoY, but fell by 4.9%.
Mahindra Financial result update: 4QFY15 PAT up 7% YoY and 144% QoQIndiaNotes.com
- Mahindra Financial Services reported better than expected 4QFY15 results with net profit growing 7% YoY to INR3.33 billion, beating estimates by 23%.
- Key factors were a 6% beat in net interest income due to higher interest writebacks from improved asset quality, and lower operating expenses due to a reversal of employee provisions.
- Asset quality improved significantly with GNPAs declining 120bps sequentially to 5.9% and NNPA declining 100bps to 2.4%, driven by focus on recoveries and seasonal effects.
Q2FY15: Hold Federal Bank for a target of Rs156 - Sushil FinanceIndiaNotes.com
- Federal Bank reported decent quarterly results with credit growth of 15% and stable asset quality. Net interest income grew 6% year-over-year due to advances growth and stable margins.
- Advances grew 15% year-over-year across segments like agriculture, retail, and SME. Deposits grew 14% year-over-year. Asset quality remained stable with gross and net NPAs of 2.1% and 0.66% respectively.
- The analyst maintains a 'Hold' rating with a target price of Rs. 156, expecting continued profitable growth and stable asset quality.
Petronet LNG: Reports decent set of numbers, hold - Sushil FinanceIndiaNotes.com
Petronet LNG has reported decent set of numbers for the quarter ended March’14 which were slightly better than expectations. With no major trigger in offing in near term, expect the stock to underperform & hence maintain hold with a revised price target of Rs152
Dabur’s (DABUR) 3QFY15 results were mixed, with consolidated sales growth of 9.2% YoY to INR20.7b (est. INR21.7b) and underlying domestic volume growth of 7.4% (est. 9%). EBITDA posted healthy 18.4% growth YoY to INR3.5b (INR3.5b), while recurring PAT grew 16.2% YoY to INR2.8b (est. INR2.8b).
ING Vyasa Bank Q2FY14 Result: Maintain neutralIndiaNotes.com
ING Vysya Bank’s (VYSB) 2QFY15 PAT was 9% above estimate at INR1.8b (+2% YoY) led by better-than-expected NIM (+10bp) and lower provisioning. Reported NIM improved 17bp QoQ to 3.54%. However, adjusted for interest reversal on account of stressed accounts in 1QFY15, NIM was stable QoQ at 3.54%.
Indian Bank Q1FY15: Buy for a target of Rs230IndiaNotes.com
Indian Bank’s 1QFY15 reported PAT declined 35% YoY to INR2.1b (31% below expectation). While NIM was largely stable QoQ at 2.4%, loan growth of 8% YoY (expectation of 15% YoY) led to 9% below estimated NII of INR10.7b; buy.
Yes Bank: Reports tepid set of numbers in Q1FY15; HoldIndiaNotes.com
Yes Bank reported tepid set of numbers which were marginally below our estimates. While NII grew by 13.1% YoY to INR 7453 mn, profit grew by 9.6% to INR 4395 mn dented largely by 3.7% decline in non interest income and 25.1% surge in operating expenses. Hold
Indusind Bank reported strong results for the second quarter of fiscal year 2015, with healthy growth in advances, deposits, and net interest income. Net interest income grew 19% year-over-year due to a 22% rise in advances and stable net interest margins. Asset quality remained stable with gross and net non-performing assets at 1.08% and 0.33% respectively. The bank expects further growth driven by its expansion strategy and improving business segments.
DLF has reported 1QFY15 EBITDA at INR7.4b (v/s est of INR5.7b) on the back of sharp uptick in margin to 43% (v/s 35% in FY14). Revenue stood at INR17.3b (-25% YoY) v/s est of INR19.6b.
Q3FY15: Buy PTC India for upside 22%, target price 109IndiaNotes.com
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Shriram Transport Finance Company Q1FY15: Buy for a target of Rs1130
1. 26 July 2014
1QFY15 Results Update | Sector: Financials
Shriram Transport Finance
Sunesh Khanna (Sunesh.Khanna@MotilalOswal.com); +91 22 3982 5521
Alpesh Mehta (Alpesh.Mehta@MotilalOswal.com); +91 22 3982 5415
BSE SENSEX S&P CNX
CMP: INR886 TP: INR1,130 Buy26,127 7,790
Bloomberg SHTF IN
Equity Shares (m) 226.9
M.Cap. (INR b) / (USD b) 201/3.3
52-Week Range (INR) 1,021/465
1, 6, 12 Rel. Per (%) 1/20/3
Financials & Valuation (INR billion)
Y/E MAR 2015E 2016E 2017E
Net Inc. 40.9 49.1 57.9
PPP 31.7 38.2 45.1
PAT 14.7 19.2 23.7
Cons.PAT 15.9 20.5 23.8
EPS (INR) 65.0 84.5 104.5
EPS Gr. (%) 16.6 30.1 23.7
Cons. EPS
(INR)
70.1 90.4 105.3
Cons. EPS Gr.
( )
16.6 29.1 16.5
BV/Share
(INR)
420.1 492.2 581.4
Conso. BV
( )
435.5 513.5 603.5
RoA on AUM
(%)
2.3 2.6 2.8
RoE (%) 16.6 18.5 19.5
Payout (%) 14.5 14.5 14.5
Valuations
P/Cons. EPS
( )
12.6 9.8 8.4
P/Cons. BV (x) 2.0 1.7 1.5
Div. Yield (%) 0.9 1.2 1.5
Shriram Transport’s 1QFY15 PAT declined 10% YoY and (up 4% QoQ to INR3b
(In line). Moderation in AUM growth (+4% YoY to INR544b), decline in
disbursements (7% YoY), and improvement in margins (10bp QoQ) are key
highlights of the quarter.
Continued weakness in underlying asset class led to three year high credit cost
of 2.2%. GNPA ratio down 12bp QoQ to 3.7% and PCR stood at 80%.
NII (incl. securitization income) grew 7% YoY and down 6% QoQ to INR9.6b.
Margins declined 47bp YoY to 6.54%. by a) interest reversals due to higher
asset quality stress, b) reducing off higher spread balance sheet book and c)
shift in AUM mix towards non CV segment.
Led by lower securitization of INR1.7b and higher repayments, off balance
sheet AUM declined 17% QoQ and YoY to INR139b and its share in overall AUM
declined to 26% vs 31% a quarter ago and 32% a year ago
Equipment finance business reported weak trends with sharp increase in GNPA
(+100bp QoQ to 2.3%) and moderate growth of 8% YoY (flat QoQ) to INR34b.
Led by higher credit cost ROE for the quarter stood at 4% v/s 25% a year ago.
Asset quality trend in this business remains weak however, mgmt remains
confident of recovery in 2HFY15
Valuation and view: SHTF’s return ratios are at cyclical low, with decadal high
credit cost and lowest margins. However, incremental data points like increase in
freight rates and improved utilization levels initial sign that worst may be behind
for CV cycle. We expect gradual improvement as stability in business and
regulatory side is emerging. Growth to remain moderate in near term and to be
driven by non-CV segment. SHTF is well placed to ride the up-cycle with niche
customer segment, strong presence in used CV financing and healthy
capitalization. Maintain Buy.
Investors are advised to refer through disclosures made at the end of the Research Report.
2. 26 July 2014 2
Shriram Transport Finance
Quarterly performance and reason for deviation
Y/E March 1QFY15A 1QFY15E Var (%) Comments
Net Income 9,646 9,544 1
Net income in line with estimates
% Change (Y-o-Y) 7.0 5.9
Other Income 266 400
Total Net Income 9,912 9,944 0
Operating Expenses 2,515 2,650 -5 Higher than expected employee expense
Operating Profit 7,398 7,294 1
Provisions 2,966 2,825 5 Higher provisioning for standard assets
Profit before Tax 4,432 4,469 -1
Tax Provisions 1,368 1,352 1
Net Profit 3,064 3,117 -2
PAT In lIne with estimate
% Change (Y-o-Y) -10.2 -8.6
Source: MOSL/Company
Moderation in growth continues, AUM mix further increases towards old vehicles
AUMs growth moderated to 4% YoY and 2.4% QoQ at INR544b. While used
vehicle loans growth was healthy (+12% YoY, 3.3% QoQ), moderation in new
vehicle loans (down 38% YoY and 10% QoQ) led to overall moderation in
growth.
Sharp new vehicles in overall AUM declined to 10.5% v/s 11.4% in FY14 and
17.4% a year ago.
Disbursements declined by 6.7% YoY (up 6.5% QoQ) to INR74.1b; New CV
disbursements were down 49% YoY but grew 39% QoQ, whereas disbursements
in the old CV segment stood at INR70b (down 2% YoY and up 5% QoQ).
Off-books AUMs de-grew 16.4% YoY and 16.6% QoQ; led by lower securitization
of INR 1.7b during the quarter. Off books proportion of AUM declined to 25.5%
v/s 31.3% in FY14 and 31.6% in 1QFY14.
Margins improve 10bp QoQ; Likely to improve from hereon
NII (including securitization income) grew 7% YoY and 6% QoQ to INR9.6b.
Margins improved 8bp QoQ to 6.54%.
On a YoY basis margins have declined 47bp on the back of interest reversals
(due to high asset quality stress), reducing high spread off balance sheet book
and shift in AUM mix further towards old vehicles.
GNPA declines QoQ still high; Coverage ratio remain healthy at +79%
GNPAs during the quarter declined 7% QoQ, GNPAs in percentage terms
declined 65bps YoY and 12bp QoQ at 3.74%.
Provisioning expenses (including for standard assets) stood at INR2.9b,
increased 18% YoY and 21% QoQ basis. PCR remained healthy at +79%.
Credit cost increased to 214bp in 1Q v/s 187bp in 4QFY14. This quarter
witnessed the highest credit in last three years.
Stress levels have remained high on the back of weak economic environment,
low freight rates and increasing fuel costs. However, we expect environment to
improve in the 2HFY15.
Other highlights
Securitization during the quarter at INR1.7b (lowest in last 8 quarters).
CAR remained healthy at 22.9% with a tier 1 of 17.5%.
3. 26 July 2014 3
Shriram Transport Finance
Valuation and view
SHTF’ return ratios are at cyclical low, with decadal high credit cost and lowest
margins. However, incremental data points like increase in freight rates,
improved utilization levels and collection rates and improving IIP etc all point
towards worse of the CV cycle is behind. We expect gradual improvement as
stability in business and regulatory side is emerging.
Sharp decline in economic growth resultant impact on asset quality (cyclical high
credit cost and bottom margins) and regulatory changes led to risk adjustment
margins falling to five-year low and sharp decline in return ratios (RoE down to
16% from 30% in FY09).
Near terms margins are likely to be under pressure due to higher cost of funds
led by budget proposals related to debt mutual funds. However, improvement
in cycle and lower stress addition, traction in used CV portfolio and higher
securitization will support margins in the medium term.
Growth to remain moderate in near term and to be driven by non-CV segment.
While yields in passenger vehicle portfolio are near to CV segment, operating
cost is relatively high which will lead to some pressure on profitability in the
near term. While SHTF’s return ratios have moderated compared to its historical
trends, we expect ROA’s of ~2% and ROE of ~15% over FY14/16E.
Increasing diversification coupled with the initiatives of penetrating deeper in
rural location, financing other vehicles like tractors, Passenger vehicles etc (30%
of the AUM vs 15% in FY10) augurs well in the long term
Subsidiary profits have become sizeable and now contribute ~7% of
consolidated PAT. We expect contribution to rise further on a lower base and
growth rate is likely to be much higher than standalone business as the
environment will revive.
SHTF is well placed to ride the up-cycle with niche customer segment, strong
presence in used CV financing and healthy capitalization. SHTF trades at 2x/1.7x
FY15/16E consolidated BV and 12.6x/9.8x FY15/16E consolidated EPS. Maintain
Buy with FY16E-based target price of INR1,130 (2.2x FY16E P/Consol Book).
4. 26 July 2014 4
Shriram Transport Finance
Story in charts
Disb. growth declined 7% YoY during the quarter (INRb) Proportion of off-book assets declined ~500bp QoQ (%)
60 64 60 55 61 67 67 63 68 70 71 69 74
40 36 40 45 39 33 33 37 32 30 29 31 26
1QFY12
1HFY12
9MFY12
FY12
1QFY13
1HFY13
9MFY13
FY13
1QFY14
1HFY14
9MFY14
FY14
1QFY15
OnBooks Off Books
AUM mix shifted further in favor of old CVs (%)
76 76 77 77 78 79 79 81 83 84 87 88 90
24 24 23 23 22 21 21 19 17 16 13 12 10
1QFY12
1HFY12
9MFY12
FY12
1QFY13
1HFY13
9MFY13
FY13
1QFY14
1HFY14
9MFY14
FY14
1QFY15
UsedCVs (%) New CVs (%)
Securitization during the quarter stand at INR2b
2
5
33
43
0
4
30
54
14
28
23
43
2
1QFY12
2QFY12
3QFY12
4QFY12
1QFY13
2QFY13
3QFY13
4QFY13
1QFY14
2QFY14
3QFY14
4QFY14
1QFY15
Assets Securitized(INR b)
NIMs (% on AUM) improve marginally sequentially
8.2
7.7
7.2 7.4
7.7 7.5
7.2 7.0
6.7 6.5 6.5 6.5
2QFY12
3QFY12
4QFY12
1QFY13
2QFY13
3QFY13
4QFY13
1QFY14
2QFY14
3QFY14
4QFY14
1QFY15
ReportedNIM (%)
Opex management led to control over C/I ratio despite
moderation in income growth
20 21
22
21
22
21
22 21
25
23
26
26
25
1QFY12
2QFY12
3QFY12
4QFY12
1QFY13
2QFY13
3QFY13
4QFY13
1QFY14
2QFY14
3QFY14
4QFY14
1QFY15
7. 26 July 2014 7
Shriram Transport Finance
Financials and valuations
8. 26 July 2014 8
Shriram Transport Finance
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Disclosure of Interest Statement SHRIRAM TRANSPORT FINANCE
Analyst ownership of the stock No
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Promotion) Order 2005 (referred to as "investment professionals"). This document must not be acted on or relied on by persons who are not investment professionals. Any investment or investment activity to
which this document relates is only available to investment professionals and will be engaged in only with such persons.
For U.S.
Motilal Oswal Securities Limited (MOSL) is not a registered broker - dealer under the U.S. Securities Exchange Act of 1934, as amended (the"1934 act") and under applicable state laws in the United States.
In addition MOSL is not a registered investment adviser under the U.S. Investment Advisers Act of 1940, as amended (the "Advisers Act" and together with the 1934 Act, the "Acts), and under applicable state
laws in the United States. Accordingly, in the absence of specific exemption under the Acts, any brokerage and investment services provided by MOSL, including the products and services described herein
are not available to or intended for U.S. persons.
This report is intended for distribution only to "Major Institutional Investors" as defined by Rule 15a-6(b)(4) of the Exchange Act and interpretations thereof by SEC (henceforth referred to as "major institutional
investors"). This document must not be acted on or relied on by persons who are not major institutional investors. Any investment or investment activity to which this document relates is only available to major
institutional investors and will be engaged in only with major institutional investors. In reliance on the exemption from registration provided by Rule 15a-6 of the U.S. Securities Exchange Act of 1934, as
amended (the "Exchange Act") and interpretations thereof by the U.S. Securities and Exchange Commission ("SEC") in order to conduct business with Institutional Investors based in the U.S., MOSL has
entered into a chaperoning agreement with a U.S. registered broker-dealer, Motilal Oswal Securities International Private Limited. ("MOSIPL"). Any business interaction pursuant to this report will have to be
executed within the provisions of this chaperoning agreement.
The Research Analysts contributing to the report may not be registered /qualified as research analyst with FINRA. Such research analyst may not be associated persons of the U.S. registered broker-dealer,
MOSIPL, and therefore, may not be subject to NASD rule 2711 and NYSE Rule 472 restrictions on communication with a subject company, public appearances and trading securities held by a research
analyst account.
For Singapore
Motilal Oswal Capital Markets Singapore Pte Limited is acting as an exempt financial advisor under section 23(1)(f) of the Financial Advisers Act(FAA) read with regulation 17(1)(d) of the Financial Advisors
Regulations and is a subsidiary of Motilal Oswal Securities Limited in India. This research is distributed in Singapore by Motilal Oswal Capital Markets Singapore Pte Limited and it is only directed in Singapore
to accredited investors, as defined in the Financial Advisers Regulations and the Securities and Futures Act (Chapter 289), as amended from time to time.
In respect of any matter arising from or in connection with the research you could contact the following representatives of Motilal Oswal Capital Markets Singapore Pte Limited:
Anosh Koppikar Kadambari Balachandran
Email:anosh.Koppikar@motilaloswal.com Email : kadambari.balachandran@motilaloswal.com
Contact(+65)68189232 Contact: (+65) 68189233 / 65249115
Office Address:21 (Suite 31),16 Collyer Quay,Singapore 04931
Motilal Oswal Securities Ltd
Motilal Oswal Tower, Level 9, Sayani Road, Prabhadevi, Mumbai 400 025
Phone: +91 22 3982 5500 E-mail: reports@motilaloswal.com