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DCB reported advance degrowth of 0.37% for Q4FY20 on a QOQ basis while deposits registered a QOQ growth of 2.14%, even though Q4 usually has historically been the strongest quarter for the bank. NIMS for the quarter stood at 3.64% against 3.71% in Q3FY20. GNPA's stood at 2.46% against 2.20% in Q3FY20 while NNPA stood at 1.16% against 1.03% in Q3FY20. The provision coverage ratio was at 70.81% against 76.99% in Q3FY20. Advances growth to pick up pace from Q3FY21 as COVID induced pain eases and the economy returns to normalcy. GNPA's increase - upgrades delayed On a QOQ basis GNPA'S registered an increase of INR 795 mn as upgrades were affected by the lockdown. Within GNPA's the highest...
20 July 2020 Mahindra Finance (MMFS) reported 1QFY21 PAT of INR1.6b (up 128% YoY; down 29% QoQ), a 3% miss. While PPoP beat our estimates by 25%, higher-than-expected provisions at INR8.4b led to the modest PAT miss. While the value of assets financed declined sharply, we note the decline in Tractors was much lower (35% YoY). Around half of the opex cut is sustainable, as per management. Gross Stage 3 assets increased 75bp QoQ to 9.2% due to slippages from tractor owners who had not availed moratorium. provision coverage to 40% QoQ from 31%. ECL% increased to 5.5% v/s 4.4% in 4QFY20 and 3.6% in 1QFY20. MMFS is comfortable on the ALM front, with liability repayments of INR54.7b in 2QFY21, against a cash balance of INR85b.
India's petroleum product consumption surged 47% MoM (21% YoY) to 14.6mmt in May'20 as fuels across segments exhibited resurgent growth in tandem with the Indian economy's emergence from the world's strictest lockdown.
IOCL announced that domestic petroleum product demand improved in May as staggered easing of the lockdown stemmed the decline in consumption to 30% YoY (from 46% YoY in April).
Management's strong commentary despite weak performance was driven by 1) Strong deal pipeline, 2) Decent performance in all verticals except Travel, 3) No further erosion in Airline Services....
Lower disbursements (VAF down 67% yoy) and collections (75% of customers under moratorium) directly suppressed large cost components like travelling, commissions and conveyance. Renegotiation of fixed costs (rentals, outsourced services, etc.) and reduction in discretionary costs (advertising, etc.) also pulled down the opex. On-roll manpower has been...
City Union Bank: CUBK's 1QFY21 earnings were ahead of our estimates on account of lower-than-expected operating expenditure and higher-than-expected treasury gains. Expectedly, sequential balance sheet growth was negligible. The sharp reduction in the proportion of the portfolio under moratorium to just ~12.5% was heartening, and the bank's performance on this front is significantly better than that of its peers, despite its high share of SME loans. We maintain a BUY with a target price of Rs 164 (2.1x FY22E ABV). Our assigned multiple reflects the bank's (1) strong PPOP profile and capital position, which are capable of absorbing shocks, and (2) consistent performance across most parameters. It remains our preferred pick amongst the mid-tier banks. Dilip Buildcon: Dilip Buildcon (DBL) reported 1QFY21 APAT at Rs 336mn (73%/71% YoY/QoQ), marginally behind our estimate, as revenue declined by 16%/23% YoY/QoQ. However, execution was 9% ahead of our estimate as labour availability improved to 90%. CFO during the quarter was negative at Rs 2bn as NWC days increased to 114 days from 93 days at FY20 end. Net D/E also increased from 0.8x on Mar-20 to 0.92x on Jun-20. Nonetheless, despite muted ordering in the sector, the company has won orders of Rs 107bn till date in FY21. We maintain BUY on DBL, with a target price of Rs 466/sh, given its (1) strong and diversified order book of Rs 261bn and (2) continued focus on asset recycling. We have valued EPC business at 8x FY22E EPS and HAM at 1x P/BV. Deccan Cements: Deccan Cement's (DECM) 1QFY21 volume...
SBI Macquarie stake sale deal continues to be an overhang on the stock, negotiations to likely restart with prospective buyers. ASBL reported resilient operational performance in a tough scenario with revenues falling 34% YoY due to Covid-19 pandemic, impacting construction...
were moving at a steady pace until 15th Mar'20 with timely collection of come to halt due to a) directive and strict implementation of nationwide lockdown, b) stoppage of work requested by clients, c) labour related issues who were unable to return post Holi holidays and d) concerns towards health...
MMFSL is one of leading Non-banking Finance Companies (NBFCs) with customers primarily in the rural and semi urban markets of India. MMFSL benefits from its close relationships with dealers & its longstanding relationships with original Equipment Manufacturers (OEMs) which allow it to provide on -site financing at dealerships. MMFSL is primarily engaged in providing financing...
We revise our FY21E/FY22 EPS by 6/34% and increase our TP to Rs 141/sh (vs Rs 134/sh earlier). We maintain BUY on Ashoka Buildcon with revised TP of Rs 141/sh. Adjusting for ~Rs 1bn release of contingencies in revenue from some of the projects, ABL missed our earnings estimate by 18% on account of weak execution and lower than expected EBITDA margin. Labour availability is 50-65% as of now and sites are working at 50-65% efficiency. Tolling has reached 85% of pre-Covid-19 level within three week of resumption. NWC days improvement, low net D/E of 0.04x and comfortable liquidity insulates ABL from COVID-19 headwinds.
NBIE Values your patronage- Vote for The Team in the Asia Money poll 2020. Click Here We maintain Buy on Indian Oil Corp (IOC) based on our raised TP of Rs148. We are raising earnings 130% in FY21E, respectively after the 4QFY20 results con-call based on new assumption for FY21E (a) low risk of inventory loss in FY21/ possible gains in FY22, and b) improved petchem assumptions that offset the cut in refining and marketing volumes; and reduced retail margin Rs3.5/lit vs. Rs5.25/lit. Our buy call is based on: (i) improved outlook for retail margins under...
HPCL to lead tactical rally in OMCs despite refining woes We maintain Buy on IOC and upgrade BPCL and HPCL from Accumulate to Buy following revised earnings and TP, which we have rolled over to FY22E. We see PSU refining majors (OMCs) delivering double-digit returns in the next 6-12 months based on the upside leverage to marketing margins under low oil prices below US$40-50/bbl. We believe that these stocks are poised to enter the blue sky phase last seen during FY14-17, when the steep fall in oil price from US$107 to US$47-50/bbl boosted marketing margins and earnings for the OMCs. As a result, IOC and BPCL delivered compounded returns of 39% and 40%, respectively while HPCL's stock price witnessed a CAGR of...
NBIE Values your patronage- Vote for The Team in the Asia Money poll 2020. Click Here We maintain Buy on Indian Oil Corp (IOC) based on our trimmed TP of Rs146. Our buy call is based on: (i) improved outlook for retail margins under sub US$4050/bbbl (ii) refining and petchem margins are at trough levels and could revive over the next 1-2 years based on likely closure of capacities and iii) compelling valuations post the sharp 34% fall in the stock price in the last one year that has priced in worries over policy/volatility in margins and likely risk of increasing competition from private retailers/alternative fuels. IOC's 1QFY21 adjusted PAT at...
25 June 2020 The company posted huge inventory loss of INR185b (refining at INR162b and marketing at INR23b) during the quarter. Adjusted EBITDA for inventory stood at INR214.1b (v/s INR74.0b in 4QFY19 and INR50.3b in 3QFY20). Reported EBITDA came in at INR29.3b and forex loss for the quarter was at INR27.2b. Higher interest cost was offset by higher other income. The company revalued its inventory at the end of the quarter and recorded an exceptional item of INR113b (of which INR80b was refining and INR33b was marketing); thus, PBT came in at loss of INR136.1b. IOCL stated that total inventory loss of INR185b also includes revaluation loss. IOCL has moved to a lower tax rate and re-measured its DTL. Reported PAT stood at loss of INR51.9b.
NBIE Values your patronage- Vote for The Team in the Asia Money poll 2020. Click Here We maintain Buy on HPCL with a target price (TP) of Rs343, which we have arrived at based on 7x PE on our unchanged consolidated FY22E EPS. The standalone 1QFY21 results were a massive beat vs. our estimates. The adjusted PAT came in at Rs28.2bn vs our estimate of Rs14.8bn and 3.5x the PAT reported in 1QFY20. The beat was due to Gross/EBITDA margins coming in 181bps/352bps above our forecast, driven by robust unit EBITDA margin on marketing volume ~ Rs6351/te, as per our proforma analysis....
We maintain Buy on HPCL with a target price (TP) of Rs343 (+60.3% to CMP), which we have arrived at based on 7x PE on our reduced FY22E EPS (based on past average). This follows our earnings revision - cutting FY21E/FY22E earnings by 54.5%/21.9% post the 4QFY20 results call with HPCL management. The standalone 4QFY20 results were a beat vs. our estimates - adjusted PAT of Rs10.3bn vs our estimate of loss at Rs27mn. The beat was due to a steep tax write back of Rs15.48bn. The reported PAT came in at Rs268mn after exceptional loss of Rs10.03bn attributed to the impact of lockdown on inventory valuation. Reported GRM came in at minus US$0.1.23bbl, including refining inventory loss of Rs25.84bn vs. NBIE estimate of minus...
