Daily Brief Financials: Jio Financial Services, HKEX, Bank Of Baroda, Lippo Malls Indonesia Retail Trust and more

• 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.

• HKEX (388 HK) outlook has been withering for some time, and new data on property transactions, shows that this remains weak.
• SGX (SGX SP) in a less volatile geopolitical financial center, has a much lower market capitalization while its earnings outlook is far stronger.
• Two major differences between these two entities is their ROE and ROA, although the former may be more relevant. SGX (SGX SP) has an ROE that is nearly 50% higher.

• 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