Daily Brief Financials: Ngern Tid Lor , Mizuho Financial Group, India Shelter Finance, Union Bank Of India, Stylam Industries, Yuexiu Property and more

• KCE Electronics PCL (KCE TB) will replace Ngern Tid Lor (TIDLOR TB) in the Stock Exchange of Thailand SET 50 Index (SET50 INDEX) at the close on 29 December.
• Estimated one-way turnover is 0.55% and will result in a one-way trade of THB 455m. There is nearly zero funding flow on the other index members.
• Passive trackers will need to buy close to 1.2% of KCE Electronics PCL (KCE TB)‘s free float while selling around 1.6% of float in Ngern Tid Lor (TIDLOR TB). 

• We see Ueda’s pause on lifting its negative rates policy as temporary, and we expect that this policy change could occur as early as January
• Despite this monetary pause in tightening and the fall in 10Y JGB yields, we are encouraged by the rise in long term loan yields in the BoJ data to October-end
• We reiterate our positive views on Resona, Mizuho, MUFG and Concordia

• India Shelter Finance (0570670D IN) raised around US$144m from its India IPO.
• India Shelter Finance (ISF) is a retail-focused HFC targeting the self-employed customer with a focus on first time home loan takers in the low and middle income group.
• We have covered various aspects of the deal in our previous note. In this note, we will talk about the demand and trading dynamics.

• We see 8 stocks moving from MidCap to LargeCap, 8 stocks moving from LargeCap to MidCap, 11 stocks from SmallCap to MidCap, and 14 stocks from MidCap to SmallCap.
• Some stocks were added to global indices last month while some could be added in February. There are potential index implications for the NIFTY Index and Nifty Next 50 Index too.
• The upward migrations have continued to outperform the downward migrations. The largest recent outperformance has come from stocks expected to move from the Mid Cap to the Large Cap segment.

• While the profitability of Stylam Industries (SYIL IN) is growing healthily (>30% YoY) in H1 FY24 due to margin expansion, revenues are trending at -4.5% YoY.
• The company became net cash in H1 FY24 (73 crore INR)  and zero gross debt. A strong balance sheet would aid in the company’s expansion plans. 
• Trading at 23x/18x FY24e/25e, we see strong growth ahead for the company as it cements its position as one of India’s top laminate export players. 

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.

• Yuexiu Property