India

• In this insight, we take a look at the Potential ADDs/DELs for the BSE SENSEX, 100, and 200 indices in the December 2024 index rebal event.
• We expect six ADDs/DELs for BSE 100 and six ADDs/DELs for BSE 200.
• Zomato is one of the six BSE 100 expected DELs but its fate will depend on when its expected F&O list inclusion takes place and the index provider’s discretionary choices.

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.

• Greenko Energy Holdings

• Swiggy is planning to raise around US$1.25bn through its upcoming India IPO.
• Swiggy Limited (Swiggy) is a business to commerce (B2C) marketplace company offering users a platform for ordering grocery and household items (Instamart) and food delivery, through its on-demand delivery network.
• In this note, we talk about the not-so-positive aspects of the deal.

• Aditya Infotech Ltd (6596564Z IN) is looking to raise about US$155m in its upcoming India IPO. The deal will be run by ICICI and IIFL.
• It is a CCTV/video surveillance provider company offering a range of advanced video security and surveillance products, technologies and solutions for enterprise and consumer segments under its CP PLUS brand.
• According to the F&S report, it was the largest Indian-owned company offering video security and surveillance products, solutions and services, in terms of revenues in FY24.

• Rubber Board new and replanting subsidy program starts rolling  
• RRII, IOCL sign MoU to boost research in process oils  
• Rubber Board stalls Kerala Govt move to shut Central Nursery 

• 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 these  indices in the March 2025 index rebal event.
• There are no changes for NIFTY 50 but there could be four changes for NIFTY Next 50 according to current rankings.

• Swiggy Limited is planning to raise around US$1.25bn through its upcoming India IPO.
• Swiggy Limited (Swiggy) is a business to commerce (B2C) marketplace company offering users a platform for ordering grocery and household items (Instamart) and food delivery, through its on-demand delivery network.
• In this note, we talk about the positive aspects of the deal.

• Vishnu Chemicals (VCL IN)  is now backward integrated with the soda ash, CO2 Gas plant and ore requirement to overcome the challenge of raw material price volatility. 
• Company operated in niche & specialty chemical segment and will launch detailed  capex plan in Q2 for forward integration. 
• Management aims to consolidate EBITDA margins around 17.5%-18% by year-end, with a target of achieving consistent margins at 20% over the next 2-3 years.

• Sanathan Textiles (0907479D IN) plans to re-appear for its IPO. The company is into yarn manufacturing and has a presence in all three, Polyester, Cotton and Technical Textiles segments. 
• Revenue growth did light up in FY22, however topline growth has pretty much been stale since then. Moreover, margins have also been on a sliding trajectory.
• Key forensic takeaways include capitalising of expenses on the back of falling margins, acquisition of a non-operating subsidiary from promoters, secondary income sources driving profits, etc.

• Shiva Pharmachem Limited (9155347Z IN) is looking to raise around US$110m in its India IPO.
• It is a manufacturer in the Indian specialty chemicals business and was the largest manufacturer of acid and alkyl chlorides by volume in CY22 in India, as per Frost&Sullivan .
• In this note, we talk about the company’s historical performance.

• Hyundai Motor India (1342Z IN) is looking to list on the exchanges by selling up to INR 279bn (US$3.3bn) of stock at a valuation of up to INR 1,593bn (US$19bn).
• The anchor allocations will be completed early next week, and the stock is expected to start trading on 22 October.
• The stock will not get Fast Entry to global indices. Inclusion at regular rebalances should take place in February and June next year.

• Hyundai Motor India (1342Z IN) has set an IPO price range of 1,865 to 1,960 rupees per share, aiming for a valuation as high as US$19 billion. 
• Hyundai Motor (005380 KS) is selling a 17.5% stake in Hyundai Motor India in this public offering. Hyundai Motor India IPO is scheduled to trade starting 22 October.
• Our updated base case valuation of Hyundai Motor India is market cap of US$19.7 billion based on P/E of 25.9x our estimated net profit of 64.1 billion INR. 

• Change in HIL Ltd (HIL IN) started after the appointment of professional CEO Mr. Akshat Seth. 
• HIL is turning around its acquisition of Parador and Topline, which were Loss making. The company was not performing due to lower demand in US, EU etc. 
• Aiming for 14-16% Revenue growth and 2-3% EBITDA Margin improvement due to distribution growth, Parador Turnaround and high demand in real estate segment.

• Re-Introducing our weekly Namaste India 2.0. This iteration builds on our earlier version and is designed for investors keen to track developments in India.
• Nuclear power currently contributes less than 2% of India’s total electricity generation, indicating significant room for growth.
• Going ahead, with earnings taking center stage, the high valuations commanded by iShares MSCI India ETF (INDA US) are likely to get challenged.  

• Dr Agarwal’s Health Care Ltd (8140044Z IN) is looking to raise about US$480m in its upcoming India IPO. The deal will be run by Jefferies, Kotak, MS and Motilal.
• Dr Agarwal’s Health Care is a healthcare/hospital chain in India providing eyecare services, including surgeries; consultations, diagnoses, non-surgical treatments; and sells opticals, contact lens, accessories and eyecare related pharmaceutical products.
• According to the CRISIL MI&A report, it had a ~25% market share of the total eye care service chain market in India in FY24. 

• Godawari Power and Ispat (GODPI IN) is fully integrated steel manufacturer with a diverse portfolio encompassing iron ore mining, pellet production, sponge iron, steel billets, ferroalloys, and power generation.
• Net Cash Balance Sheet, Mining Expansion, and upcoming Integrated Steel Plant provide huge potential for the captive consumption.
• Execution of the capex plan within the stipulated timeframe is the key risk.

• Ola Electric (OLAELEC IN)‘s  aggressive price cuts on its S1 scooter aim to fend off competition and boost sales but risk alienating existing customers and damaging brand perception.
• Ola Electric’s mishandling of online criticism—capped by its CEO’s heated spat with a well-known comedian—has tarnished the brand’s image.
• With market share and stock prices dropping, concerns loom over how the company will fare after lock-up expiry in November/February and whether it will qualify for global index inclusion.

• Hyundai Motor (005385 KS) is looking to raise around US$3.3bn via listing its India unit, Hyundai Motor India. HMI is a wholly owned subsidiary of the Hyundai Motor Group.
• HMI primarily manufactures and sells four-wheeler passenger vehicles and parts. Currently its vehicle portfolio includes 13 passenger vehicle models across sedans, hatchbacks, SUVs and battery EVs.
• In our previous notes, we have looked at the company’s past performance and provided our thoughts on valuations. In this note, we talk about index inclusion.

• NR prices surge over 33% YoY during April-August 2024
• In FY 2024-25 Q1, operating margin of top five tire firms falls ~200 basis points to 14%
• NR prices in downward trend in Oct amid a surge in supply

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
• Medco Energi
• Tata Motors ADR

• Nifty50 Monthly IVs post +2.6 vol jump as risk premia gets marked higher on return from 02.10.2024 holiday – China-induced Index selloff & FII Options-buying being the main drivers.
• Vol Term-Structure has switched from Contango to Backwardation in the front end for Nifty50 options. BankNifty Vol Curve flattens due to 11th hour IV markdown. 
• Options Market looks ill-prepared for another leg lower in indices – Smile & Skew subdued in spite of IV-jump.

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.

• CIFI Holdings
• Vedanta Resources

• Our last insight predicted quite precisely what happened to the NIFTY Index during the last 3 weeks (our forecast was a 3-5 weeks rally, around +4%/+5% higher).
• After 3 weeks up in a row, last week the NIFTY pulled back – the question obviously now is: would this be a good time to enter/re-enter the trade LONG?
• The answer, as always, lies in our Market Reversal Matrix models, keep reading to find out…

• Schloss Bangalore Ltd (SCHBL IN) plans to raise about US$600m in its India IPO. The deal will be run by BofA, MS, JPM, Kotak, Axis, Citi, IIFL,ICICI, JMF,Motilal and SBICaps.
• It is a luxury hospitality company which owns, operates, manages and develops luxury hotels and resorts under ‘The Leela’ brand, through direct ownership and hotel management agreements with third-party owners.
• According to the HVS Report, SBL is the only institutionally owned and managed pure-play luxury hospitality company in India. Its portfolio comprises 3,382 keys across 12 operational hotels.

• Dhampur Bio Organics (DBOL IN): Integrated sugar manufacturer listed in 2022 post demerger from Dhampur Sugar Mills (DSM IN) 
• With change in Ethanol policy from Sep-24, Company will be significantly benefitted with its grain-based ethanol plant and higher sugar production with good monsoon. 
• Company is reducing its debt significantly to deleverage its balance sheet.

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. Biocon Ltd
2. Lippo Karawaci
3. Tata Motors Ltd
4. Softbank Group
5. Rakuten

and more…

• Government of India raised around US$513m via selling some of its stake in Bharti Hexacom’s IPO in Apr 2024. Its IPO lockup is set to expire soon.
• 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 Northeast.
• In this note, we will talk about the lockup dynamics and possible placement.

• Kilburn Engineering (KEL IN) acquired new assets, expanded into waste heat recovery, and enhanced its market position with acquisitions in July and August 2024.
• Debt settlement, 2 Fundraise, 2 Mega acquisition, diversification of revenue and margin improvement are some key positives for Kilburn.
• Rs. 371Cr of Order Book, FY25E Revenue of Rs. 500Cr Revenue leads to 60% revenue growth and expecting margins of 20% will lead to huge potential for this company.

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.

• Vedanta Resources

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.

• Lippo Karawaci

• Dr Lal PathLabs Ltd (DLPL IN) has maintained its 10% revenue growth target for the current financial year, mainly driven by 6–7% growth in patient volume.
• The operating environment is becoming conducive. Competitive intensity in terms of predatory pricing, promotional offer, and cash burning to acquire customers, have come to an end.
• As of Q1FY25, DLPL has net cash position of INR10B. The company is looking for small or mid-sized acquisitions in South and West India and expanding in small towns.

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.

• Nickel Industries
• Tata Motors ADR

In our latest Asia Monthly, we discuss the performance of major Asian credit indices and review UST curve movements in September 2024. We also provide a recap of major news and macroeconomic releases, including those from the US, China, India, Indonesia and Japan.

In addition, we summarise the Top/Bottom performers, recent USD bond issuances and rating actions in Asian corporate credit, as well as a list of our recent research. The Asia Monthly publication serves to keep investors updated on developments in the Asian corporate USD bond market.

• Casagrand Premier Builder Ltd (0949880D IN) is looking to raise about US$131m in its upcoming India IPO. The deal will be run by JM Fin and Motilal Oswal.
• Casagrand Premier Builder is a residential developer in India. It constructs apartments and independent villas spanning luxury, mid-end and affordable categories in the states of Karnataka, Telangana and Tamil Nadu.
• According to CBRE, it was the largest residential developer in Chennai with ~24% share in terms of launches and ~20% in terms of demand during 1st Jan’17 to 31st Mar’24.

• Swiggy (1255298D IN) Swiggy is looking to raise about US$1.25bn in its upcoming India IPO. The deal will be run by Kotak, Citi, Jefferies, Avendus, JPM, BofA and ICICI.
• Swiggy Limited (Swiggy) is a business to commerce (B2C) marketplace company offering users a platform for ordering grocery and household items (Instamart) and food delivery, through its on-demand delivery network.
• The platform can also be used to make restaurant reservations (Dineout), event bookings (SteppinOut), product pick-up/drop-off services (Genie) and other hyperlocal commerce activities (Swiggy Minis).

• CE Info Systems (MapmyIndia) (1052633Z IN) is one of the leading Indian players engaged in advanced digital maps, geospatial software and location-based IoT technologies. It launched its IPO in 2021
• Since its IPO, MAPPLS has embarked on a growth journey since then. It also boasts high margins & ROCE due to its asset light model.
• While the balance sheet looks good, one might have to check on the speedy receivables and trend of commission expenses.

Biocon Biologics launched a roadshow last week to market its USD 5NC2 144A/RegS notes offering. The expected issue rating is BB/BB by S&P/Fitch. The proceeds will be used to refinance an outstanding syndicated loan facility obtained for the acquisition of Viatris’ global biosimilars business for USD 3.335 bn in May 2022.

We see fair value for the proposed 5NC2 bonds at 7%.

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.

• Bharti Airtel
• Lippo Karawaci
• Softbank Group