India

• Foreign selling has continued on HDFC Limited (HDFC IN) and HDFC Bank (HDFCB IN) and foreign room on the proforma merged entity is 17.23%.
• Higher than 15% foreign room will require passive MSCI trackers to buy 209m shares (US$4.05bn) of HDFC Bank (HDFCB IN) at the time of merger implementation.
• If foreign selling continues and foreign room on the merged entity exceeds 20%, there will be buying from passive FTSE trackers as well.

• Bharat FIH (BFIH) aims to raise around US$660m in its India IPO via selling a mix of both primary and secondary shares. BFIH is a subsidiary of Foxconn.
• Its initial operations were focused on mobile phones, of late it has been expanding its portfolio to include mechanics, electric vehicles, televisions and hearables. 
• In this note, we will talk about the not so positive aspects of the deal.

• Piramal Enterprises (PIEL IN) obtained shareholders nod for demerging its pharma business and consolidated under Piramal Pharma Limited (PPL). Later, PPL will be listed on India stock exchange.
• PPL has a differentiated pharmaceutical business model, with three business verticals. CDMO, the largest revenue contributor, has track record of consistent above-market growth due to its niche and complex capabilities.  
• Listed as a separate entity, PPL will see multiple expansion and command premium valuation over other Indian generic drug makers, due to its niche and limited competition portfolio.

• Innova Captab (1605221D IN)  is looking to raise about US$115m in its upcoming India IPO. The deal will be run by ICICI and JM Financial.
• Innova Captab is an integrated pharmaceutical company in India with a presence across the pharmaceuticals value chain including research and development, manufacturing, drug distribution and marketing and exports. 
• Its business includes a contract development and manufacturing organization (CDMO) business providing manufacturing services to Indian pharmaceutical companies, a domestic branded generics business and an international branded generics business.

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
• Yankuang Energy Group

• India’s Open Network for Digital Commerce (ONDC) is expected to break duopolies across the digital commerce ecosystem including e-marketplaces like Flipkart Online Services (1398508D IN) & Amazon.com Inc (AMZN US). 
• We think it is the other way around. We expect them to thrive and become even more dominant in case the market expands as envisioned under ONDC. 
• While it could be too early & premature, Walmart (WMT US) thanks to its investments in Flipkart and the path chosen by PhonePe is better placed compared to Amazon in India.

• Life Insurance Corp of India (LIC) (LICI IN) and Tata Power (TPWR IN) will be added to the Nifty 100 Index (NSE100 INDEX) and Nifty Next 50 Index (NIFTYJR INDEX). 
• Nmdc Ltd (NMDC IN) will be deleted from the CPSE ETF (CPSEBE IN) and there will be no replacement in the index.
• The NMDC deletion along with capping changes means that there is decent volume (and ADV) to buy on quite a few names in the CPSE ETF (CPSEBE IN).

• Bharat FIH (BFIH) aims to raise around US$660m in its India IPO via selling a mix of both primary and secondary shares. BFIH is a subsidiary of Foxconn.
• Its initial operations were focussed on mobile phones, of late it has been expanding its portfolio to include mechanics, electric vehicles, televisions and hearables. 
• In this note, we will talk about the positive aspects of the deal.

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.

• Anton Oilfield
• China Datang Corp Renewable Power
• Vedanta Resources

Content is external broker report sourced from online content aggregator through publicly available sources and is displayed below for general informational purposes only. Refer full disclaimer below.

Content is external broker report sourced from online content aggregator through publicly available sources and is displayed below for general informational purposes only. Refer full disclaimer below.

Content is external broker report sourced from online content aggregator through publicly available sources and is displayed below for general informational purposes only. Refer full disclaimer below.

• The demand environment for offline electronic retailers has been good in Q1, the macro factors also point to good growth for FY23. 
• Companies like Haier Smart Home Co Ltd (6690 HK) and Samsung Electronics (005930 KS) have done well. Voltas Ltd (VOLT IN) has not been able to recover. 
• Indian consumer no longer wants everything cheap, assuming affordability, quality and brand value is taking prominence. 

• Allied Blenders and Distillers (ABD) is looking to raise about US$250m in its upcoming India IPO. The deal will be run by ISec, Axis, JM Fin, Kotak and Equirus.
• ABD is the largest Indian-owned Indian-made foreign liquor (IMFL) company and the third largest IMFL company in India, in terms of annual sales volumes between FY14 and FY21.
• It had a market share of 8.2% in the IMFL market by sales volumes in FY21. Its products are retailed at over 64,000 outlets in India.

Content is external broker report sourced from online content aggregator through publicly available sources and is displayed below for general informational purposes only. Refer full disclaimer below.

• Kids Clinic India (9890311Z IN) is looking to raise approximately US$160m in its upcoming India IPO.
• Kids Clinic India (KCI) is a super-specialty mother and baby-care provider, offering end-to-end coverage of all stages of the parenthood journey, beginning with fertility treatments, through maternity, neonatology and paediatrics.
• KCI’s growth has been impressive, becoming operating EBITDA and CFO positive in recent years. However, it remains unclear as to which business segment or regions are KCI’s largest growth drivers.

The Asia Monthly focuses on providing updates on recent events, information on new issues and spread movements, as well as summarising our top picks. The Asia Monthly is intended to broaden investors’ understanding of the Asian USD high-yield market.

• The near term impact of ONDC on OFD platforms like Zomato & Swiggy is limited, longer term they will have to move from platform to a network centric model.
• An external shock will be required to drive faster ONDC adaption as we have seen in the case of UPI.
• Logistics companies especially the ones with express capabilities are likely beneficiaries in case ONDC scales up rapidly. 

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. Sunac China Holdings
2. Shimao Property Holdings
3. Powerlong Real Estate Holdings
4. JSW Steel Ltd
5. Tata Steel Ltd

and more…

• Zomato (ZOMATO IN) ‘s announcement to acquire Blinkit (BCPL) for all-stock deal worth INR 44.5 bn has rattled the market price of the stock in the trading sessions that followed.
• While the management focuses on the cost synergies and the bigger picture, the acquisition has left several doubts, including the valuation and cash burning nature of Blinkit.
• More importantly, it is the corporate governance that should be looked at, especially since this is an indirect RPT, as mentioned in our earlier report Zomato’s Investments Game: Stain on Governance.

• Max Healthcare Institute (MAXHEALT IN) reported Q4FY22 results in-line with expectations, with 12% revenue and 58% net profit growth. The EBITDA margin improved 70 basis points to 24.8% during Q4FY22.
• Despite the Omicron, the average occupancy for the quarter stood at 68%, partly fueled by the international medical tourism bouncing back to ~90% of the pre-covid levels in March 2022.
• The company plans to add over 2,800 beds in the next five years. For context, it has current bed capacity of 3,400. Capex will be funded through internal accrual.

• Our checks suggest Hitachi Home & Life Solutions India Ltd (JCHAC IN) has lost market share this season. 
• Market share loss has come on the back of poor product quality due to focus on costs and competition, which is irreparable in spite of the strong dealer network. 
• Poor capital allocation, high receivables and low-profit margins, all warrant attention. 

• The legal tussle between promoters of Dish TV India (DITV IN) and Yes Bank (YES IN) has again entered into the limelight.
• The promoters of Dish TV, after repeatedly attempting to block Yes Bank from voting, have been left in the dark by the Bombay High Court’s verdict. 
• However, Mr. Goel still continues to sit on the board which irked several investors. This indicates that the story is not over and there are still some grey areas.

Content is external broker report sourced from online content aggregator through publicly available sources and is displayed below for general informational purposes only. Refer full disclaimer below.