Company Reports

Saturday, August 3, 2019
CMP : 1310
Target Price : 1525

For 1QFY2020, Bata India (BIL) posted strong set of numbers, exceeding our expectations on bottom-line front. Revenue grew by ~11% yoy. The company’s operating margins improved by robust 141bps yoy (after adjusting rent cost). On the bottom-line front, BIL reported growth of ~22% yoy to `101cr on the back of strong operating performance. Outlook and …

Wednesday, July 31, 2019
CMP : 674
Target Price : 850

Outlook & Valuation: Axis Bank currently trades at 2x its FY2021E price to book value (after adjusting value of subsidiaries). We expect the stock to get re-rated owing to (1) new leadership, (2) limited stressed loan pool, and (3) improvement in return ratios (ROA/ROE – 1.22%/14.2% by FY2021E). We recommend Buy on the stock with …

Tuesday, July 30, 2019
CMP : 429
Target Price : 490

Outlook & Valuation: At the current market price, the bank’s core banking business (after adjusting the value of subsidiaries) is trading at 1.7x FY2021E ABV. We believe strength of liability franchise (CASA – 45%), shift in loan mix towards retail assets & better rated companies, strong capitalization (tier I of 14.6%), steady improvement in stressed …

Tuesday, July 30, 2019
CMP : 5558
Target Price : 7783

For 1QFY2020, Maruti Suzuki India (MSIL) posted below expectation results both on top-line and bottom-line fronts. MSIL’s standalone top-line registered a decline of ~12% yoy to `19,720cr on the back of volume de-growth of 18%. Moreover, the company’s operating margins contracted by 454bps yoy. On the standalone bottom-line front, MSIL reported de-growth of ~27% yoy …

Tuesday, July 30, 2019
CMP : 47
Target Price : 56

For 1QFY2020, Music Broadcast Limited (MBL) posted below expectation results both on top-line and bottom-line fronts. MBL’s top-line registered a decline of ~8% yoy to `70cr on the back of volume de-growth of 14%. Moreover, the company’s operating margins contracted by 238bps yoy. On the bottom-line front, MBL reported de-growth of ~38% yoy to `8cr …

Tuesday, July 23, 2019
CMP : 2264
Target Price : 2620

Outlook & Valuation: Credit growth beat the industry growth rate driven by strong retail business. The strong liability franchise and healthy capitalisation provides earnings visibility. We value HDFC Bank using SOTP method, valuing standalone banking business at 3.5x of FY21 ABV and its two subsidiaries at `147/share. We recommend a Buy on the stock, with …

Monday, July 22, 2019
CMP : 500
Target Price : 650

Outlook & Valuation: RBL Bank’s fresh set of stressed pool would push back of 1.5% to Q2FY2021. We expect RBL Bank to grow its advances at CAGR of 33% over FY2019-21E. Improvement in CASA, higher share of retail book and inhouse priority sector lending will support NIM going forward. At CMP, RBL trades at 2.3x …

Thursday, July 18, 2019
CMP : 98
Target Price : -

Outlook & Valuation: We have a neutral view on Yes Bank, considering low CET of 8.04% for growth, the bank will have to raise capital at current valuations, which is dilutive, uncertainty related to BB & below book performance, any fresh set of downgrade in investment and advances will absorb CET1 and will impact growth. …

Tuesday, June 4, 2019
CMP : 102
Target Price : 130

Aditya Birla Capital (ABCL), a financial services provider, continued its robust growth in business operation in 4QFY19 as well. The company’s consolidated PBT increased by 59% yoy and PAT jumped by 52% yoy to `259cr for Q4FY19. Growth was supported by lending & AMC business, while health insurance continued to report loss; however management expects …

Tuesday, May 28, 2019
CMP : 1192
Target Price : 1400

Outlook & Valuation: We believe that AAL is comfortably placed to tap the upcoming opportunity in the industry owing to improving road infra, BS-VI prebuying and foray into new segment coupled with expansion of capacity by 35- 40%. However, medium term scenario looks tough, but long term prospects seem positive. At the CMP of `1,192, …

Saturday, May 25, 2019
CMP : 431
Target Price : 490

Outlook & Valuation: At the current market price, the bank’s core banking business (after adjusting the value of subsidiaries) is trading at 1.6x FY2021E ABV. We believe strength of liability franchise (CASA – 50%), shift in loan mix towards retail assets & better rated companies, strong capitalization (tier I of 14.73%), steady improvement in stressed …

Saturday, May 25, 2019
CMP : 1106
Target Price : 1470

Outlook & Valuation: We expect STFC’s AUM to grow at CAGR of 16% over FY2019-21E primarily owing to (1) post election government to increase spending on infra project (macro recovery), and (2) pre-buying of CV before the BS VI will also improve the pricing of older vehicles. We expect STFC to report RoA/RoE to 2.7%/17.6% …

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