Daily Brief India: Balrampur Chini Mills, BLS International Services, ABM Investama, Lava International, Mahindra & Mahindra and more

• Balrampur Chini Mills (BRCM IN) is one of the major integrated sugar manufacturing companies in India. Besides sugar, the company also engages in the business of ethanol and power generation.
• Balrampur has managed to turnaround its free cash flows and earnings quality. Additionally, it has also stabilized working capital on the back of declining debt. 
• While there are not many red flags, care must be given to inventory reconciliation with bank statement.

• BLS International Services (BLSIN IN) is engaged in business of providing outsourcing and administrative task of Visa, Passport and Consular services to various Diplomatic Missions across the world.
• BLS is troubled with several forensic discomforts. One should take into account the discomforts on the subsidiaries end and other linked entities like DSS Gulf Realtors.
• Other forensic setbacks include alarming bad debts, misstatement of operating cash flows and several grey areas pertaining to disclosure norms followed by the company.

The Asia HY Trade Book for November 2022 includes a summary of our recommendations, as well as our high-conviction ideas. The report also features relative-value charts and lists of the bonds across Asia (ex-Japan) HY and crossover credits.

• Lava International (9263793Z IN)  is one of the leading end-to-end focused mobile handset and mobile handset Solutions Company based in India, with operations in a number of countries.
• Major business risk arises from external environment, as Lava is one of the prominent leaders in feature phone segment, where the market is dying. 
• Key forensic takeaways pertain to ECL provisioning and some absurd trend in line items. There are several discomforts on the governance end as well which must not be ignored.

• Mahindra & Mahindra (MM IN) ‘s production data provides more questions than answers.
• The drop in production for Thar and XUV 700 in October in spite of the high order backlog is surprising. 
• Considering the industry outlook and the existing sales and production for these two models, we believe this demand forecast may not materialise