India

• India’s Credit Landscape has changed and is facing structural and regulatory challenges.
• The Indian regulator (RBI), particularly in its oversight of underwriting practices and the behavior of Non-Banking Financial Companies (NBFCs), is commendably proactive, positioning it ahead of the curve.
• We expect more such steps in other parts of the credit funnel. The recent crack down along with the stock underperformance is here to stay and possibility intensify. 

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
• Greentown China

• Tata Motors restructures, separating passenger and commercial vehicle businesses into distinct entities to unlock value in electric vehicles and Jaguar Land Rover unit.
• Streamlines operations, enhances shareholder value, and capitalizes on growth opportunities in passenger and commercial vehicle sectors.
• Offers investors specialized entities, unlocking hidden value, showcasing proactive adaptation to market changes, and positioning for sustainable growth in the automotive industry.

• Ola Electric is looking to raise about US$1bn in its upcoming India IPO.
• Ola Electric Mobility is a vertically integrated pure EV player in India with manufacturing capabilities for EVs and EV components, including cells.
• In our previous note we have looked at the company’s past performance. In this note, we will undertake a peer comparison.

• AntFin is looking to raise around US$350m by selling around 2% of Zomato (ZOMATO IN).
• Ant Group had earlier sold some of its stake in Nov 2023 and Ant just came out of lockup from the previous selldown a few days ago.
• In this note, we talk about the deal dynamics and run the deal through our ECM framework.

• With the review period complete, Titan Co Ltd (TTAN IN) should replace Indian Oil Corp (IOCL IN) in the Nifty100 Low Volatility 30 Index at the close on 27 March.
• Constituent changes, volatility changes and capping changes will result in one-way turnover of 13.2% resulting in a one-way trade of INR 4.2bn.
• The flows on the stocks are not very large but there will be same side and offsetting flows from other index trackers at the same time.

• Macrotech Developers (LODHA IN) is looking to raise around US$398m via a QIP.
• The deal here will be a well flagged one with LODHA’s board having announced its intention of raising up to INR50bn via a QIP earlier in Jan 2024.
• That being said, while representing just 3% of LODHA’s shares outstanding, the deal would be a large one to digest at 30 days of its three month ADV.

• In India, demand for pets is on the rise – so much so that the country’s pet care market is estimated to reach US$1.9 billion by 2030. However, that also means an influx of first-time pet owners who don’t always know how to take care of their charges.
• That’s where companies like Supertails come in.
• An India-based pet care startup, Supertails addresses the needs of inexperienced owners by offering a holistic platform for pet care in India.

• While some B2B ecommerce firms are struggling, others are thriving. India-based Metalbook, a B2B platform focused on the global metal supply chain, said it is eyeing US$200 million in annualized revenue run rate by the end of the 2024 fiscal year.
• Founded in 2021, the startup has raised US$15 million in a series A round led by Rigel Capital. FJ Labs participated, as well as existing investors Axilor Ventures and Stride Ventures, among others.
• Metalbook helps customers through their entire metal manufacturing and procurement cycle. This includes everything from buying and selling to customization, logistics, scrap recycling, as well as financing.

• Asahi India Glass (AISG IN) is an integrated glass and window solutions company and engages both in the automotive and the building & construction segments.
• While capital allocation is not a major concern for the company, the only element that could warrant attention is CWIP as the company has several projects overdue.
• Margins have been strong yet slightly fluctuating in the last two years. Overall, the balance sheet health looks okay.

• Earlier this month, British American Tobacco (BATS LN)’s management stated that they were reviewing their stake in ITC Ltd (ITC IN) to enhance its balance sheet flexibility.
• BAT has owned its stake in ITC for over a century and remains its largest shareholder.
• In this note, we talk about the possible deal structure and dynamics.

• There are five changes for the NSE Nifty Next 50 Index (NIFTYJR INDEX) that will be implemented at the close on 27 March. Changes are on expected lines.
• Estimated one-way turnover for the NSE Nifty Next 50 Index (NIFTYJR INDEX) is 10.1% resulting in a one-way trade of INR 22.2bn (US$268m).
• Apart from the impact on the adds and deletes, there will be a big impact on some of the non-F&O stocks due to capping and funding flows.

• Shriram Finance (SHFL IN) will replace UPL Ltd (UPLL IN) in the NIFTY Index (NIFTY INDEX) at the close of trading on 27 March. This was a high probability change.
• Trent Ltd (TRENT IN) missed out on inclusion and that results in Bharat Petroleum Corp (BPCL IN) staying in the index.
• There is over 11 days of delivery volume to trade in the add and delete and there appears to be significant positioning in one of the stocks.

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

• Bharat Highways InVIT (BHINV IN) is looking to raise up to US$301m in its Indian IPO.
• Bharat Highways InVIT is an infrastructure investment trust established to acquire, manage and invest in a portfolio of infrastructure assets in India.
• In this note, we talk about the company’s historical performance and provide our quick thoughts on valuation.

• MTAR Technologies (MTARTECH IN)  is a precision engineered company that caters to customers in clean energy, Space, Defense sectors, etc. 
• The company has done well over the last few years in terms of securing business, however there are concerns on the margins end, working capital and cash generation. 
• There also exists a high business risk in terms of customer concentration since more than 75% of the revenues (F23) come from one single entity.

• Indiabulls Housing’s Right Issue offers a unique opportunity to earn higher returns on smaller investment. 
• Indiabulls Housing is at the cusp of a turnaround: detaching its old identity maligned by various governance issues 
• Turnaround + Special Situation Bet – A potential opportunity to make outsized returns owing to the lower initial investment requirement in a company undergoing significant turnaround

• Akums Drugs and Pharmaceuticals (0200361D IN) is looking to raise >US$100m in its upcoming India IPO. The deal will be run by ICICI Securities, Axis Capital, Citigroup and Ambit.
• Akums Drugs and Pharmaceuticals (ADP) is a pharmaceutical contract development and manufacturing organization (CDMO) offering a comprehensive range of pharmaceutical products and services in India and overseas. 
• As a CDMO, it produces a range of dosage forms including tablets, capsules, liquid orals, vials, ampoules, blow-filled seals, topical preparations, eye drops, dry powder injections, and gummies, among others.