Equity L/S Analyst | Forensic Accounting | India, Yellowstone Equity

Ankit Agrawal, CFA

Equity L/S Analyst | Forensic Accounting | India

Creating Wealth through Alpha and Compounding

Yellowstone Equity

Providing unbiased and independent research on Indian equities to global institutions and individual investors


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Regulatory Disclosure: 
Note that Ankit Agrawal (Proprietor of Yellowstone Equity) is a SEBI registered Research Analyst (Registration No.: INH000007216). Registration granted by SEBI and certification from NISM in no way guarantee performance of the intermediary or provide any assurance of returns to investors. Investment in securities market are subject to market risks. Read all the related documents carefully before investing.

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Email: services@yellowstoneequity.com
Mobile: +91-7575817289

Compliance/Grievance Officer:
Name: Ankit Agrawal
Email: services@yellowstoneequity.com
Mobile: +91-7575817289
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Equity Bottom-Up

<ul>
<li>
<a href="https://www.smartkarma.com/entities/lic-housing-finance-ltd" target="_blank" data-smartkarma-citation="entities:15667:1" rel="noopener">LIC Housing Finance (LICHF IN)</a> reported stellar results, in line with the expectation from our last note. NIM expanded while provisions declined leading to Q4FY22 PAT of INR 1100cr+.</li>
<li>Asset quality improved with Stage 3 assets at 4.64% vs 5.04% QoQ and Stage 2 assets at 3.08% vs 3.75% QoQ. LICHF also recovered 350cr of NPAs during Q4FY22.</li>
<li>Adjusted for one-off tax benefits and assuming FY23 NIM at 2.4%, LICHF's normalized PAT potential is INR 3600cr+ suggesting that LICHF is trading at &lt;6x P/E on FY23E PAT.</li>
</ul>



LIC Housing Finance (LICHF IN) reported stellar results, in line with the expectation from our last note. NIM expanded while provisions declined leading to Q4FY22 PAT of INR 1100cr+.
Asset quality improved with Stage 3 assets at 4.64% vs 5.04% QoQ and Stage 2 assets at 3.08% vs 3.75% QoQ. LICHF also recovered 350cr of NPAs during Q4FY22.
Adjusted for one-off tax benefits and assuming FY23 NIM at 2.4%, LICHF's normalized PAT potential is INR 3600cr+ suggesting that LICHF is trading at &lt;6x P/E on FY23E PAT.


Pan-Asia Index Flows & Special Situations, Quiddity Advisors

Janaghan Jeyakumar, CFA

Pan-Asia Index Flows & Special Situations

Quiddity Advisors

Pan-Asia Catalysts/Events

Event-Driven

<ul>
<li>After market close on Friday 20th May 2022, the constituency changes for S&amp;P BSE 100, SENSEX 50, and SENSEX Next 50 Indices were announced. </li>
<li>There will be no changes for S&amp;P BSE SENSEX and S&amp;P BSE BANKEX Indices in the June 2022 Rebalance. </li>
<li>These changes will become effective at the open of Monday 20th June 2022. Below is a closer look at each of the names involved in the June 2022 Rebalance.</li>
</ul>


After market close on Friday 20th May 2022, the constituency changes for S&amp;P BSE 100, SENSEX 50, and SENSEX Next 50 Indices were announced. 
There will be no changes for S&amp;P BSE SENSEX and S&amp;P BSE BANKEX Indices in the June 2022 Rebalance. 
These changes will become effective at the open of Monday 20th June 2022. Below is a closer look at each of the names involved in the June 2022 Rebalance.


S&P BSE Indices: No Changes for SENSEX; 7 ADDs/DELs for BSE 100 in June 2022

Head of Research, IPOs & Placements, Aequitas Research

Sumeet Singh

Head of Research, IPOs & Placements

IPOs and Placements coverage across Asia Pacific

Aequitas Research

We cover all listing across the Asia Pacific along with follow-up placements. As of Dec 2020, our team had covered 539 IPOs with a hit rate of 73.5% and 685 placements with a hit rate of 66.8%.

We combine fundamental bottom-up views with our proprietary quantitative framework to provide a holistic coverage across new listings and placements. Our coverage includes pre-IPO notes before the deal is launched, follow-up analysis once the deal is live and post-listing trading analysis as well.

Equity Capital Markets

JD.com Inc (ADR) / Equity Capital Markets

<ul>
<li>Aequitas Research puts out a weekly update on the deals that were covered by the team recently along with updates for upcoming IPOs.</li>
<li>With LIC not delivering and Delhivery needing insurance, combined with the Korean cancellations and HK silence, it looks like its going to be a quiet few weeks for IPOs.</li>
<li>On placements, both the Korean deals were a disappointment, despite being well-flagged.</li>
</ul>


Aequitas Research puts out a weekly update on the deals that were covered by the team recently along with updates for upcoming IPOs.
With LIC not delivering and Delhivery needing insurance, combined with the Korean cancellations and HK silence, it looks like its going to be a quiet few weeks for IPOs.
On placements, both the Korean deals were a disappointment, despite being well-flagged.


ECM Weekly (22nd May 22) - JD, LIC, Delhivery, Leapmotor, Vista, Paradeep, Woori, Hyundai Heavy, NIO

<ul>
<li>LICHF reported strong Q3FY22 earnings on the back of improving asset quality leading to limited provisioning and limited interest reversal impact from OTR.</li>
<li>Disbursement in Q3FY22 was 135% of pre-COVID level i.e. vs Q3FY20. This growth momentum has continued from Q2FY22 when also it was 132% that in Q2FY20.</li>
<li>Given our FY23 earnings (PAT) projection of INR 3,600cr+, LICHF with current market cap of around INR 20,000cr is available at an attractive valuation of &lt;6x P/E  on FY23E PAT.</li>
</ul>


LICHF reported strong Q3FY22 earnings on the back of improving asset quality leading to limited provisioning and limited interest reversal impact from OTR.
Disbursement in Q3FY22 was 135% of pre-COVID level i.e. vs Q3FY20. This growth momentum has continued from Q2FY22 when also it was 132% that in Q2FY20.
Given our FY23 earnings (PAT) projection of INR 3,600cr+, LICHF with current market cap of around INR 20,000cr is available at an attractive valuation of &lt;6x P/E  on FY23E PAT.


LICHF: Strong Earnings In Line With Our Thesis

IPOs and Catalysts/Events, Global Equity Research Ltd

Arun George

IPOs and Catalysts/Events

Uncompromised, Independent, Conflict-Free Research

Global Equity Research Ltd

Global Equity Research was started in 2017 by a group of experienced research professionals. It was founded on a passionate belief in the importance and the need for uncompromised, independent, conflict-free research. We aim to provide differentiated and actionable primary and bottom up fundamental research.

Life Insurance  of India / Equity Capital Markets

<ul>
<li>
<a href="https://www.smartkarma.com/entities/life-insurance-corp-of-india" target="_blank" data-smartkarma-citation="entities:28829:1" rel="noopener">Life Insurance Corp of India (1248Z IN)</a> is the largest life insurer in India. LIC is looking to raise about $8 billion. It opens for anchor investors on 11 March. </li>
<li>LIC has leveraged its dominance to deliver healthy premium growth and high persistency ratio. However, the VNB margin and operational efficiency metrics are mid-tier compared to peers. </li>
<li>On balance, the fundamentals look sound. The IPO is worth a look for investors willing to brave the volatile IPO market conditions. </li>
</ul>



Life Insurance Corp of India (1248Z IN) is the largest life insurer in India. LIC is looking to raise about $8 billion. It opens for anchor investors on 11 March. 
LIC has leveraged its dominance to deliver healthy premium growth and high persistency ratio. However, the VNB margin and operational efficiency metrics are mid-tier compared to peers. 
On balance, the fundamentals look sound. The IPO is worth a look for investors willing to brave the volatile IPO market conditions. 


Life Insurance Corp of India IPO: Premium Market

India

LIC Housing Finance Limited provides housing finance services to individuals for purchase, construction, repair and renovation of new or existing flats and houses. The Company also provides finance on existing property for business, personal needs and gives loans to professionals for purchase, construction of clinics, nursing homes, diagnostic centers, and office space throughout India.

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LIC Housing Finance (LICHF IN)

LICHF: Stellar Q4FY22 Results

LICHF reported stellar Q4FY22 earnings in line with our expectation. FY23 PAT is likely to be INR 3600cr+, suggesting that LICHF is available at an...

Ankit Agrawal, CFA

S&P BSE Indices: No Changes for SENSEX; 7 ADDs/DELs for BSE 100 in June 2022

S&P BSE Index changes for June 2022 were announced last week. No changes for SENSEX. 7 Adds/Deletes for BSE 100 including some negative and...

Janaghan Jeyakumar, CFA

ECM Weekly (22nd May 22) - JD, LIC, Delhivery, Leapmotor, Vista, Paradeep, Woori, Hyundai Heavy, NIO

Aequitas Research puts out a weekly update on the deals that were covered by the team recently along with updates for upcoming IPOs.

Sumeet Singh

LICHF: Strong Earnings In Line With Our Thesis

LICHF with market cap of around INR 20,000cr is available at <6 P/E on FY23E PAT of INR 3,600cr+. It has potential to more than triple over the...

Ankit Agrawal, CFA

Life Insurance Corp of India IPO: Premium Market

The Indian government is seeking to sell a 5% stake in LIC to potentially raise nearly $8 billion. The IPO is worth a look for investors willing to...

Arun George

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