India

• In this note, we will take a look at the Asia Pacific IPO pipeline for 2024, following up with India after having looked at Hong Kong earlier.
• This list has been compiled on a best effort basis from tracking the company filings and through various other sources.
• The deals you see in this note are only a part of our full IPO pipeline tracker. Feel free to drop us a message for additional information on these IPOs.

• Polycab India (POLYCAB IN) is in the limelight on the back of Income Tax investigation carried in December 2023 which revealed several accounted transactions.
• In a circular, it is hinted that the IT department has detected unaccounted cash sales worth INR 10 bn, unaccounted cash payments made by distributors, and some non-genuine expenses.
• However our forensics framework does not hint at any alarming red flags, apart from low FA turnover ratio, stock with third parties and board composition.

• Over a third of the way through the review period of the June rebalance, we see one potential index change with Wipro Ltd (WPRO IN) in deletion zone.
• There are a bunch of stocks that could be added to the index as a replacement and price changes over the rest of the review period are important.
• Passive trackers will need to trade over 1x ADV and over 7x of delivery volume on the index changes, so there will be decent impact on the stocks.

• Ola Electric is a vertically integrated pure EV player in India with both technology and manufacturing capabilities for EVs and EV components (including battery packs, motors and vehicle frames).
• The company has filed for an IPO to raise US$600m through the sale of new shares making it the first ever EV company to go for an IPO in India.
• Though the company’s growth story has been impressive, the sales volume is largely dependent on government subsidies raising concerns over its future prospects.

• In this note, we will take a look at broker performance for Indian IPOs and placements in 2023. 
• The following dataset includes all Indian IPOs and placements above US$100m, which amounted to a total of 66 deals.
• The deals you see in this note are based on our historical IPO and placement tracker. Feel free to drop us a message for additional information.

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.

• Shui On Land
• Sunny Optical Technology Group
• Vedanta Resources
• Yuexiu Property

• BluSmart Unlike other players in India’s crowded EV scene, BluSmart Mobility does not build its own electric vehicles.
• Instead, the company is a ride-hailing firm that leases EV models like the Tata e-Tigor, MG ZS, and Hyundai Kona to be part of its 5,500-strong fleet.
• But an equally important of BluSmart’s business is its charging infrastructure division.

• InterGlobe Aviation Ltd (INDIGO IN)’s co-founder Rakesh Gangwal’s 25%+ stake will be released from lock-up tomorrow.
• He had earlier stated his intention to pare down his stake. He has sold shares in Sep 2022, Feb 2023 and Aug 2023.
• In this note, we will talk about the lockup dynamics and possible placement.

• The upcoming earnings season, along with the forthcoming Budget and Elections, should all contribute to keeping the undertone bullish for the NIFTY Index (NIFTY INDEX). 
• Bandhan Bank Ltd (BANDHAN IN) reported a minor dip in collections for the non-EEB portfolio, which has probably spooked the street.
• Other names discussed include MMFS, POONAWAL, AUBANK, LTFH, and AAVAS.

• Rain Industries is an Indian small-cap company (~$660M) that manufactures 2 carbon-based inputs for Aluminium Industry (10% of global market share).

• It also has a cement & value-added chemical business

• The Company is ignored by market likely due to its ‘commodity’ nature, debt on their balance sheet and small market cap which drives most investors away. 

• As electric vehicles gain popularity across the globe, they are still typically more expensive than gasoline-powered vehicles.
• One area where EVs still lag behind is auto financing, which – in its regular iteration – does not necessarily cater to EVs’ specific needs.
• Indian fintech startup Revfin aims to change that, and, in turn, make EVs more accessible to consumers.

• FirstCry (0172540D IN) seeks to raise up to US$700m in its upcoming India IPO. The deal will be run by Kotak, Morgan Stanley, Bank of America, JM Financial and Avendus.
• FirstCry is India’s largest multi-channel retailing platform for Mothers’, Babies’ and Kids’ products in terms of GMV, for the year ending Dec 2022 (9M23), according to RedSeer. 
• In India, FirstCry sells Mothers’, Babies’ and Kids’ products through its online platform, company-owned modern stores, franchisee-owned modern stores and general trade retail distribution.

• Ola Electric (1700674D IN) is looking to raise about US$1bn in its upcoming India IPO. The bookrunners are Kotak, Citigroup, BofA, Goldman Sachs, Axis, ICICI Sec, SBI Caps, BoB Caps.
• Ola Electric Mobility is a vertically integrated pure EV player in India with manufacturing capabilities for EVs and EV components, including cells.
• The firm manufactures EVs and certain core EV components like battery packs, motors and vehicle frames.

• 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.
• As things stand, there could be one index change for the SENSEX index. 
• There could be four ADDs/DELs for the BSE 100 index and four ADDs/DELs for the BSE 200 index.

• Ola Electric (1700674D IN), the largest Indian electric two-wheel vehicles (E2W) player, is seeking US$660 million from a primary raise along with a secondary raise at a US$7-8 billion valuation.
• In Ola Electric IPO: The Bull Case, we highlighted the key elements of the bull case. In this note, we outline the bear case.
• The bear case rests on high R&D capitalization, ongoing losses, high attrition, declining contract liabilities, cash burn and deteriorating balance sheet. 

• Steady and strong profit is the key features of Power Finance and this is improving during FY24.
• ROA expansion can continue to reach and possibly surpass the peaks of FY15 and FY16 with loan volume, contained costs, better credit metrics.
• Recent quarterly data shows better loan volume and financial assets expanding more than financial liabilities, with credit costs in reverse.

In our inaugural Asian Monthly for 2024, we discuss the regional credit outlook for the year, with a focus on China, India, Indonesia as well as our favoured bonds. We also provide a review of 2023, including new Asian USD corporate bond issuances and defaults last year.

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
• Adani Ports & Special Economic Zone
• ENN Natural Gas
• Greentown China
• Innergex Renewable Energy
• SK Hynix
• Tata Motors ADR

• A weekly summary of key developments across ECM and Event-Driven names tracked by us across Hong Kong, Australia, New Zealand, Singapore, Japan, Indonesia, Malaysia, Thailand, Korea, India and Chinese ADRs.
• ECM developments – Ola Electric (1700674D IN) and Mixue Group (MIX HK) IPOs.
• Event-Driven developments – Aoki Super (9977 JP), Hollysys Automation Technologies (HOLI US), Weiqiao Textile Co (2698 HK), Vinda International (3331 HK).

• Posco DX (022100 KS) continues to drop following its section transfer from the KOSDAQ market to the KOSPI market. Short interest in the stock nearly halved in December.
• There were big net inflows to China ETFs with creations in CSI 300 Index ETFs and redemptions in ETFs tracking the CSI 500 Index and CSI 1000 Index.
• Creations continued in the iShares Emerging Markets ex China (EMXC US) ETF with units outstanding reaching a new high.

Lucror Analytics Weekly Wraps provide an overview of all Morning Views comments and reports published by our analyst team in the past week, and also showcase a list of the most-read reports.

In this Insight:

1. Agile Property Holdings
2. China Vanke
3. Indika Energy
4. SK Hynix
5. Vedanta Resources

and more…

• Ola Electric (1700674D IN), the largest Indian electric two-wheel vehicles (E2W) player, is seeking US$660 million from a primary raise along with a secondary raise at a US$7-8 billion valuation. 
• Ola is the best-selling E2W brand in India in terms of monthly E2W registrations on the VAHAN Portal of the Ministry of Road Transport and Highways.
• The bull case rests on rising market share in a growing market, a rapid growth phase, increasing gross margin and a favourable cash conversion cycle.   

• Bajaj Finance Ltd (“BAF”) reported key performance metrics for Q3FY24. It reported strong growth, particularly in AUM which grew 7%+ QoQ and 35% YoY to reach INR 311,000cr.
• Customer franchise grew 5%+ QoQ to reach 80.41mm, surpassing the 80mm mark. New loans booked grew to 9.86mm, a growth of 26% YoY and 15%+ QoQ.
• The liability book also did well with deposits growing at around 6% QoQ and 35% YoY to reach INR 58,000cr.

• Nearing the end of the review period, we see 6 potential changes for the NSE Nifty Next 50 Index (NIFTYJR INDEX) using the current index methodology.
• Estimated one-way turnover is 13.9% resulting in a one-way trade of INR 26.9bn. There will be more than 1.5x ADV to sell on nearly all deletes.
• The potential adds have outperformed the potential deletes by 35% over the last two months and some stocks are looking extremely frothy.

• Bank Of Baroda (BOB IN)  has become the second-best PSU bank in India after SBIN, in terms of improvement in asset quality and profitability.
• Medium-Term ROE Forecast 16% to 18%; ROA >1% consistently; Asset Quality problems receding; Strategy is to diversify loan book towards retail further and focus on improving efficiencies
• Despite the recent rally, P/BV is cheap at 0.9x FY25e for high teen ROE business. BOB can easily re-rate to P/BV of 1.3x FY25e in the near term

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.

• Indika Energy
• Lippo Malls Indonesia Retail Trust
• SK Hynix
• Vedanta Resources

• Shriram Finance (SHFL IN) is a high probability add and UPL Ltd (UPLL IN) is a high probability delete at the NIFTY Index (NIFTY INDEX) rebalance in March.
• There is a lower probability of Bharat Electronics (BHE IN) or Trent Ltd (TRENT IN) replacing Bharat Petroleum Corp (BPCL IN) at the rebalance.
• Jio Financial Services (JIOFIN IN), Avenue Supermarts Ltd (DMART IN) and Zomato (ZOMATO IN) will enter the running once added to the F&O segment of the market.