2017 was marked by a strong and uptrending market with few factors seeing consistent strong performance. Buying high beta, 12M performance and avoiding high RoE stocks was the most productive approach for the year.
The company has announced a 5-million tonne expansion that should be positive for medium-term growth. In addition, the company plans to raise $2 billion through equity and equity-linked instruments.
We expect FCL to be India’s fifth-largest FMCG company in revenue terms by FY21. Future Group’s retail ecosystem yields a unique competitive advantage that allows FCL (Future Consumer) to launch innovative products with a disruptive go-to-market strategy
Warburg Pincus plans to acquire up to a 20% equity stake in Airtel’s DTH business for $350 mn (valuing it at $1.75 bn; 8x FY18e Ebitda), according to Airtel.
We pencil in a benign rate hike cycle, expecting the central bank to begin hiking rates by the second half of fiscal 2019, with a total of three rate hikes expected by the end of calendar 2019.
Revenue growth didn’t show signs of pickup (muted volume growth, decline in sales headcount q-o-q for the second consecutive quarter), while margin beat was primarily cost-led.
AUSFB primary focus, the MSME loan segment, likely to emerge as one of India’s fastest-growing financial segments over the next decade.
HDFC Bank reported another quarter of 30% y-o-y growth in core PPoP. This was driven by continued strong loan growth of 22% y-o-y, strong fees (24% y-o-y)and good cost control (14% y-o-y).
Valuation has bottomed out; key products likely to drive earnings recovery; upgraded to ‘Overweight’
Domestic equity mutual funds received inflows of $3.9 bn, the highest ever in any month. Including ETFs, inflows stood at $4.1 bn.
On operating metrics such as revenue growth, margins, EBITDA growth, net income growth and return ratios (RoCE/RoE) and based on bottom-up estimates, APSEZ is expected to be in the top quartile of global ports.
Indigo’s lease rentals are 17% of FY17 actual sales while depreciation was lower at around 2-3% of sales as cost of six year leases that the company takes are high. Overall while dividend yield drops, but assuming scenario A, we see 2% to 4% jump in FY18/19 earnings.
Q1FY18 earnings were 4% above our estimate, mainly driven by securities and insurance business.
Growth is in a U-shaped recovery due to domestic and global factors; earnings revision breadth expected to improve in next few months.
The government has issued a notification clarifying that there will be no levy of any additional duty of excise on cigarettes: However, we still do not have clarity whether the current ‘National Calamity Contingent Duty’ (NCCD) will be levied in addition to the Goods and Services Tax (GST).
Impact to be greater for banks with unsecured loans and less for secured loans or joint liability group lending.
As the world’s third-largest and fastest-growing aviation market, India presents one of the globe’s biggest such growth opportunities, benefiting much of the country’s aviation value chain.
The Q4FY17 PAT was Rs 150 crore (47% y-o-y), 9% below our estimate. PPOP was 2% below estimate driven by lower NII, offset partially by lower costs.
Earnings likely to be under pressure due to high level of bad loans, low coverage, and deteriorating PPoP.
Stock could come under pressure in near term but is expected to outperform over a one-year period
We cite gradual improvement in industry cement demand, UTCEM’s positioning with timely capacity additions, and its pan-India presence.
Data provided by housing finance companies along with results on rollout of revised Credit Linked Subsidy Scheme will be key
Valuation is implying only 70% of estimated growth in earnings; energy ROCE likely to be 15% by FY19e, making stock an outperformer
Karnataka, in the 2017-18 Budget, announced a revision in the additional excise duty (AED) on liquor.
Dec-17 Sensex target up 10% to 33,000 to reflect such possibility
Bajaj Finance & Bharat Financial Inclusion should deliver moderate returns over next year; Shriram City Union Finance likely to do well.
The limits on Savings Bank accounts will continue, but more importantly for microfinance lenders, the limits for cash withdrawals from current accounts / cash credit accounts/overdraft accounts have been withdrawn.