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ICICI Prudential Life Insurance Company Ltd (ICICI Pru) was the largest private sector life insurer in India by total premium in fiscal 2016. Issue Open: Sep 19 - Sep 21 2016. ICICI Prudential Life Insurance Company Ltd (ICICI Pru) was the largest private sector life insurer in India by total premium in fiscal 2016 and assets under management at March 31, 2016. It is a joint venture between ICICI Bank Limited, in terms of total assets with an asset base of Rs. 7.2 trillion at March 31, 2016, and Prudential Corporation Holdings Limited, a part of the Prudential Group, an international financial services group with GBP 509 billion of assets under management at December 31, 2015. ICICI Pru was one of the first private sector life insurance companies in India and commenced operations in fiscal 2001. It offers customers a range of life insurance, health insurance and pension products and services. Every fiscal year since fiscal 2002, it has consistently generated the most new business premiums on a retail weighted received premium basis among all private sector life insurers in India
PNB Housing Finance Ltd. is a subsidiary of Punjab National Bank (PNB), which holds 51% of share capital in the company. PNB Housing provides housing loans to individuals and corporate bodies for construction, purchase, repair and upgradation of houses. It also provides loan for commercial space, loan against property and loan for purchase of residential plots. The company is the fifth largest Housing Finance Company (HFC) in India by loan portfolio as of September 30, 2015 with the second largest amount of public deposits in an HFC in India as of March 31, 2015, according to the IMaCS Report. It conducts its...
ICICI Prudential Life Insurance Company Limited (ICICI Prudential Life) is a joint venture between ICICI Bank, India's largest Private Sector Bank in terms of total assets with an asset base of 7.2 trillion as on March 31, 2016 and Prudential Corporation Holdings Ltd, a part of the Prudential Group, an international financial services group with GBP 509 billion of Assets Under Management (AUM) as on December 31, 2015. ICICI Prudential Life was one of the first private sector life insurance companies in India and commenced operations in fiscal 2001. It offers its customers a range of life insurance, health insurance and pension products and...
Aided by robust order backlog, the top-line of NBCC (India) Ltd. grew by ~14% yoy to Rs12.5bn in 1QFY17, lower than our estimates of Rs13.0bn mainly owing to subdued performance of real estate division. PMC which contributes 94% to its top-line grew by 21% yoy supported by healthy PMC orders in its order book. EBITDA declined by ~17% yoy to Rs259mn and consequent EBITDA margins came in at mere 2.1%, (-77bps yoy and -313bps qoq), while net profit grew by ~15% yoy to Rs454mn. As per its Management, operating margins would improve in coming quarters with the beginning of revenue booking from new re-development projects and pick-up in execution from new...
MBL's revenue grew by ~17% yoy to Rs7.13bn, mainly owing to pick-up in execution of old projects. EBITDA rose by ~15% yoy to Rs746mn and margins came in flat at 10.5% (yoy). Its net profit remained flat on yoy basis at Rs295mn owing to 48% jump in interest cost. Revenue growth is expected to improve further with the commencement of newly bagged Hybrid Annuity Model (HAM) projects, which account for 55% of...
Background: Balkrishna Industries (BIL) is focused solely on 'off-highway' tyres catering to agricultural & industrial segments. A low ~5% share of the global market makes us believe reasonable room exists for several years of growth. While OTR forms ~65% of the global market, for BIL, it only contributes ~34% to its revenue. With the completion of the new 140,000 MT facility at Bhuj, BIL is looking to expand in the OEM, OTR segments. The company has been undertaking various actions like setting up warehouses in markets in North America and Europe to be closer to the customer and have a just in time (JIT) system. BIL is focusing on the OEM segment while its share in revenue has...
J Kumar Q1FY17 performance was broadly in-line with consensus estimates. Revenue increased 11% YoY to Rs 4.03bn led by contribution from JNPT road project. EBITDA margin declined by 164 bps YoY to 16.9% on account of higher construction & employee expenses. Thus, EBITDA increased by 1% YoY to Rs 680mn as the revenue growth was negated by decline in margins. Net profit increased 15.6% YoY to Rs 295 mn led by higher other income. Management states that the company has been de-registered from further bidding in BMC road segment but this wont impact execution of current order-book (which is at ~ 7x FY16 revenues).
Outlook and Valuation: We expect that FY17-18E would be driven by execution of the large order backlog (~ Rs 100 bn including metro orders; ~7x FY16 revenues). However, we cut our revenue estimate by ~5%/~3% for FY17E/18E on account of delay in execution of the metro order. Our PAT estimates for FY17E/18E are getting revised downwards by 6.7%/5.7%. The stock has corrected by ~48% in the last 6 months after the BMC issue. However, management clearly states that it will not impact its ability to execute current order backlog (as MMDRA/MMRC has awarded Metro orders to JKIL post this issue). Valuation at 9.2x/6.5x on FY17E/18E earnings looks attractive post the recent fall and factors in most of the negative news flow. We reduce our target P/E multiple to 12x (from 13x) to value FY18E earnings (largely due to delay in execution of metro orders and risk of bidding in BMC orders). However, they maintain BUY with revised target price of Rs 300.
Suprajit Acquires Wescon Controls USA: Suprajit acquired US-based Wescon Controls, manufacturer of control cables in the non-automotive Outdoor Power Equipment (OPE) space by purchasing 100% outstanding equity share capital from Shell Topco LP managed by a private equity fund- Nova Capital, UK for an enterprise value of US$ 44.4 Mn.
Expected Synergies from the deal - Diversification of segments: Suprajit primarily caters to automotive cables through both domestic channels and exports; and with this acquisition, they have the scope to expand to other non-automotive sectors scaling up to 20% of their revenue chunk from a nominal portion. Enhanced geographical presence: Wescon, being positioned in North America, lays road for Suprajit to expand its presence across those regions. Similarly, Suprajit’s presence in Europe and Asian countries will be an added advantage to Wescon. Capacity scale-up and Technological Up-gradation: The overall capacity is expected to reach 250 Mn cables from the current 225 Mn cables. Further, it enables exchange of technical competence between the two. Supply chain strategies to bring in purchasing benefit for Wescon whilst paving way for cross selling strategies for Suprajit. This Suprajit Wescon deal is expected to get consolidated and the full quarter financial impact starting Q3FY17E.
Growth to Unfold on Account of Improving Demand Environment: Stable revenue growth along with healthy margins - Timken has registered turnover growth of 8.8% sequentially & 8.6% YoY growth for Q1FY17 owing to improved volumes. EBITDA margin has contracted by 150 bps QoQ mainly on account of 15.5% rise in raw material costs & 9.5% rise in employee expenses. EBIT margin & Net profit margin have also contracted by 120 bps & 130 bps sequentially to 14.0% & 9.4% in Q1FY17.
Valuation and Outlook : While introducing FY18E, we have also re-visited the financials for FY17E. While global growth outlook remains gloomy, India is one of the few economies expected to deliver growth. Being a market leader in tapered roller bearings, which largely cater to Medium and Heavy Commercial Vehicle (M&HCV), off-highway equipments and railways markets, Timken is well positioned to benefit from the much anticipated economic revival. At CMP of Rs. 547, Timken is trading at 32.5x to its FY18E EPS. Timken, in view of auto industry revival, positive industry sentiments coupled with healthy zero debt balance sheet, is well positioned to grow in times ahead. We ascribe a multiple of 38.5x FY18E EPS, which is trailing twelve months PE and recommend a “BUY” rating for an upwardly revised target price of Rs. 648 representing an upside potential of 19%.
