HSIE Results Daily: LIC Housing Finance, Vinati Organics, The Ramco Cements, Nuvoco Vistas Corporation, BSE, Somany Ceramics, Kolte Patil Developers
BSE: BSE reported modest revenue growth (+3.2% QoQ) and the margins adjusted for SGF contribution were better than expected. The transaction revenue (~31% of revenue) has a high correlation with market activity and is volatile, declining 4% YoY in 9M due to a decline in exclusive revenue. The StAR MF platform continues to drive growth for BSE, which came in at 47% YoY in 9MFY23. BSE continues to lose market share in the cash and derivative segment (7.4/1.2% down 46bps QoQ each). The focus of the new management brings in a ray of hope and aims to revive volume growth and invest in new areas of growth. The INX (gift city international exchange) and Power exchange appear to be potential revenue drivers but have limited visibility in the near term. We expect growth in transaction charges to moderate in FY23E and the listing revenue (annuity) to support growth. BSE has also announced a 2.5% stake sale in CDSL (which will be completed by Q2FY24E). We lower our PAT estimates by ~2% for FY24E. We assign a SoTP-based target price of INR 600, by assigning 20x core P/E to Sep-24E PAT + CDSL stake + net cash ex SGF. The stock is trading at a core P/E of 15/12x FY24/25E. Maintain ADD. Somany Ceramics: We maintain BUY on Somany Ceramics (SOMC), with a lower target price of INR 750/ share (13x Mar-25E consolidated EBITDA). We continue to like SOMC for its strong retail distribution, improving product mix, and tightening working capital. In Q3FY23, SOMC's reported muted tiles...