In today’s briefing:
- Escorts Kubota (ESCORTS IN) | Alarming Allegations by Dealers
- Edelweiss: Credit Business Is Normalizing; Rest of the Businesses Are Scaling Up Well
- Balaji Speciality Chemicals Pre-IPO Tearsheet
Escorts Kubota (ESCORTS IN) | Alarming Allegations by Dealers
- Escorts Kubota (ESCORTS IN) ‘s domestic market share as of FY22 stood at 10.3 % vs 12% in FY20 against the aspiration of 15% for FY22.
- Our interactions with various dealers across key northern and eastern states suggest caution and structural inability to regain market share loss.
- Post equity infusion, Kubota Corp (6326 JP) is probably in for more surprises than what it might have initially hoped for.
Edelweiss: Credit Business Is Normalizing; Rest of the Businesses Are Scaling Up Well
- Edelweiss’ credit business is now normalizing with GNPA at 2.5% and NNPA at 1.8%. Credit costs came in negative as asset quality is improving and excess provisioning is being normalized.
- Rest of the businesses continue to scale up well. Edelweiss is among the fastest grower in the mutual fund and insurance businesses. Wealth Management business continues to do well.
- At current valuation, Edelweiss is available cheap and as per our estimates, an investment in it has potential to more than quadruple by the end of FY25.
Balaji Speciality Chemicals Pre-IPO Tearsheet
- Balaji Speciality Chemicals (1742663D IN) is looking to raise about US$126m in its upcoming India IPO. The deal will be run by JM Financial and HDFC Bank.
- Balaji Speciality Chemicals (BSC) is the sole manufacturer in India of niche chemicals such as Ethylenediamine, Piperazine (Anhydrous), Diethylenetriamine, Amino Ethyl Ethanol Amines and Amino Ethyl Piperazine, according to CRISIL.
- The chemicals it manufactures are import substitutes and are used in end-use industries such as speciality chemicals. Its customer base grew from 45 in FY20 to 182 in FY22.
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