India

Lucror Analytics Morning Views comprise our fundamental credit analysis, opinions and trade recommendations on high yield issuers in the region, based on key company-specific developments in the past 24 hours. Our Morning Views include a section with a brief market commentary, key market indicators and a macroeconomic and corporate event calendar.

• Reliance Industries

• The story of Hero is the story of persistence, collaboration and achieving goals that many would have regarded as impossible.
• From its humble roots of selling bicycles in 1956 Ludhiana Punjab, to becoming the world’s largest two wheeler company is an extraordinary feat.

• Maintaining the momentum, protecting its market share and setting sights towards ‘Future of Mobility’ is something special.

• Mr. Yashish Dahiya is an impatient man. In one of the interviews with The Ken, he narrated a story of how while in college he used to run home to Noida every Friday and back to college on a Monday morning (both 30kms in one direction) as he found public buses too slow for his liking.
• Mr. Dahiya, is also persistent and doesn’t give up easy – he is one of the few people in the world who has completed the grueling Ironman triathlon – an intense race that consists of swimming, bicycle ride and a marathon all raced in that order – widely considered one of the most difficult one-day sporting events in the world.
• It’s these qualities of impatience, persistence and continuously improving oneself that can be found in the business of PolicyBazaar or PBFinTech, the name of the parent company applying for IPO.

• As you set out for Ithaka hope your road is a long one, full of adventure, full of discovery.
• These are the first few lines to the poem ‘Ithaka’ written by C.P Cavafy .
• This is the poem, then shared by the daughter of founder and CEO, Falguni Nayar, that led to the birth of Nykaa.

• Unprecedented levels of FII option-buying & increasing geo-political risk causing IVs to re-price higher.
• Skew/ Smile characteristics of the Vol Surface reflect increased risk aversion but not it panic mode – yet.
• BankNifty IVs exhibiting unusual “kink-in-the-curve”. Enter barbell structures to position for reversion in curve shape.

Lucror Analytics Morning Views comprise our fundamental credit analysis, opinions and trade recommendations on high yield issuers in the region, based on key company-specific developments in the past 24 hours. Our Morning Views include a section with a brief market commentary, key market indicators and a macroeconomic and corporate event calendar.

• Pertamina Geothermal Energy PT
• Vedanta Resources

• Marksans Pharma (MRKS IN) has done well in recent years, growing at 15.2% on a 5Y CAGR.  
• The company has a good balance sheet, strong cash generation and also witnessed a recent uptick on the margins side. UK business especially has been the cash cow.
• However, there are few impairment indicators; few subsidiaries are not audited while bad debts have appeared in the books lately. Company also has few disclosure issues.

• Aadhar Housing Finance (AHF) is now looking to raise around US$600m in its India IPO, via selling a mix of primary and secondary shares.
• AHF is focused on the low income housing segments (ticket size less than INR1.5m) in India. It offers a range of mortgage-related loan products.
• In this note, we look at the updates from the company’s recent filings.

• Canara Bank has seen stunning profit expansion over the past several years
• Lower NPLs can drive lower credit costs to support profit expansion further
• ROE moved from 11.7% to 17.3% over the past several years

• In this insight, we take a look at the Potential ADDs/DELs for the BSE SENSEX, 100, and 200 Indices in the June 2024 index rebal event.
• Wipro Ltd (WPRO IN)‘s deletion from Sensex is imminent but there are question marks over the top replacement names as this involves some subjectivity.  
• For BSE 100, Jio Financial Services (JIOFIN IN) is a new potential ADD and that has caused major changes to the index change expectations I had previously.

• Company recently demerged from Ghcl Ltd (GHCL IN) and guiding for 30% revenue growth and double margins from here onwards with cotton prices being stable.
• A Debt Free Textile company available at 0.56x Price to Book with growth plan in progress and adding Value added products in its portfolio.
• Due to Forced selling from DII, FII company remained undervalued, now with changing margin profile, the Company will be available at a cheap valuation compared to peers.

• Our flash checks across a couple of dealers indicate pressure on margins across the industry. Voltas Ltd (VOLT IN) is trying hard to gain market share.
• Other names discussed include PNB Housing Finance Ltd (PNBHOUSI IN), Vedant Fashions (MANYAVAR IN) and Bandhan Bank Ltd (BANDHAN IN). 
• Varun Beverages (VBL IN) and Schaeffler India (SCHFL IN) show up as interesting ARs to read. 

• NIFTY 50 represents the 50 largest stocks listed in the National Stock Exchange (NSE) of India and the NIFTY Next 50 index tracks the next 50 largest names.
• In this insight, we take a look at the names leading the race to become ADDs/DELs for the NIFTY 50 and NIFTY Next 50 indices in the September 2024 rebalance.
• There could be at least one change for NIFTY 50 and separately, there could be up to five changes for NIFTY Next 50.

Lucror Analytics Morning Views comprise our fundamental credit analysis, opinions and trade recommendations on high yield issuers in the region, based on key company-specific developments in the past 24 hours. Our Morning Views include a section with a brief market commentary, key market indicators and a macroeconomic and corporate event calendar.

• Adani Green Energy

• Downtrend in IVs stall as market sentiment deteriorates. Vol Regime Model sticks to “High & Down” state.
• Consider Equity Tail hedges/ buying OTM puts in current environment. Roll strikes lower if/when equities weaken further.
• Skew compression seen in BankNifty options as preference for out-of-money puts wane. Skew selling an unsuitable strategy at current levels.

• Vodafone Idea (IDEA IN) plans to raise around US$2.2bn via a follow-on public offering.
• The deal has been in the works for years and proceeds will be used for capex and short-term debt repayment.
• In this note, we will run the deal through our ECM framework and talk about the deal dynamics.

• Government of India raised around US$513m via selling some of its stake in Bharti Hexacom’s IPO.
• Bharti Hexacom (BH) is a communications solutions provider offering consumer mobile services, fixed-line telephone and broadband services to customers in the Rajasthan and the North East telecommunication circles in India.
• We have covered various aspects of the deal in our previous note. In this note, we will talk about the demand and trading dynamics.

• Canara Bank (CBK IN) should replace Bandhan Bank Ltd (BANDHAN IN) in the NSE Nifty Bank Index (NSEBANK INDEX) at the September rebalance.
• Passive trackers will need to buy nearly 2 days of ADV in Canara Bank (CBK IN) while selling over 1 day of ADV in Bandhan Bank Ltd (BANDHAN IN). 
• Canara Bank (CBK IN) is one of the best performing banking stocks while Bandhan Bank Ltd (BANDHAN IN) has been the worst performer over the last two years.