Watch the interview of Kunal Shah, Nirmal Bang Commodities with Shereen Bhan on CNBC-TV18, in which he shared his reading and outlook on commodity markets and specific commodities.
Watch the interview of Kunal Shah, Nirmal Bang Commodities with Shereen Bhan on CNBC-TV18, in which he shared his reading and outlook on commodity markets and specific commodities.
Prabhudas Lilladher is bullish on Union Bank of India and has recommended accumulate rating on the stock with a target of Rs 260 in its October 31, 2014 research report.
"Union Bank reported muted performance in Q2FY15 with net profit declining by 44% YoY affected by weak NII growth and higher provisions. NIMs contracted by 7bp QoQ due to interest reversals (Rs730 mn) on new slippages and ~14% QoQ decline in current account deposits. Core fee income surprised positively as it grew 21% YoY far ahead of balance sheet growth and pulled core revenue growth to 14% YoY. Asset quality disappointed as fresh slippages stood at Rs19.68bn (3.4% annualized) and was led by lumpy slippages in textile and cement sectors. However management maintained its guidance to bring down GNPL ratio to ~4% by end of FY15 vs 4.7% currently and improve NIM to 2.8-2.9%. We maintain ACCUMULATE with PT of Rs260 which corresponds to 0.8x Sep-16 ABV."
"UNBK reported 13% YoY growth in revenues led by 21% YoY growth in core fee income and 165% YoY growth in exchange profits. NII growth was muted at 6.6% YoY affected by – (1) interest reversal of Rs730mn due to elevated slippages (~3.4% annualized) during the quarter (2) ~14% QoQ decline in current account deposits. Operating expenses increased by 8.7% QoQ and further pushed PPOP growth down to 9% YoY. Asset quality disappointed as stressed asset formation remained high at ~Rs29 bn led by rise in both fresh slippages and restructuring. Slippages was lumpy in nature with two accounts (one each in textile and cement sectors) forming ~40% of total slippages. O/s restructured asset portfolio increased marginally to 5.3% of total loans (2.8% excluding SEB restructuring) though still stands better than peers. Management maintained its guidance to bring down GNPL ratio to ~4% and improve NIM to 2.8‐2.9% by FY15 end. Tier I capital at 7.3% (without profits) in Q2FY15 remains low but is not expected to be alarming as management reiterated of slowing loan growth to 10‐12% for FY15, helping maintain capital levels and pre‐empt the need for immediate capital infusion. We maintain ACCUMULATE with PT of Rs260/share which corresponds to 0.8x Sep-16 ABV," says Prabhudas Lilladher research report.
For all recommendations, click here
Disclaimer: The views and investment tips expressed by investment experts/broking houses/rating agencies on moneycontrol.com are their own, and not that of the website or its management. Moneycontrol.com advises users to check with certified experts before taking any investment decisions.
To read the full report click here
Over the weekend global e-tailer Amazon in a filing to the US Securities and Exchange Commission cautioned investors about issues related to interpretation of India's laws which could potentially impact its business plans.
Indian e-commerce is the flavour of the season with foreign investors and e-tailers lining up large chunks of capital. But the regulatory uncertainty surrounding the sector is causing concerns though money continues to be committed to the market for now.
Over the weekend global e-tailer Amazon in a filing to the US Securities and Exchange Commission cautioned investors about issues related to interpretation of India's laws which could potentially impact its business plans. The government certainly isn't helping matters reports Poornima Murali and Kritika Saxena
Sushil Finance has recommended hold rating on IndusInd Bank with a target price of Rs 750, in its research report dated October 21, 2014.
"Indusind Bank Ltd. (IIB) has reported good set of numbers for the quarter ended September'14 with superior growth & stable asset quality. We attended the conference call of the company and following are the key highlights of the results."
"Healthy advances growth (~22% YoY) coupled with stable NIMs (3.63% v/s 3.66% Q1) resulted in strong NII growth which grew by ~19% YoY & 4% QoQ to Rs.8.3 bn. Advances growth was mainly on back of robust growth in corporate loan book which grew by ~37% YoY while retail portfolio grew by modest 7% YoY. Sluggish growth in retail was on account of flattish growth in vehicle segment while non-vehicle segment witnessed strong growth in the quarter (Corp/Retail 57:43). Deposits grew by ~24% YoY on back of better CASA growth which stood at ~33% YoY. CASA ratio improved by 60 bps in Q2 to 33.9% (Q1-33.3%). Better growth in Forex, Distribution/Loan processing fees & Investment Banking led to strong growth in corefee income which grew by 31% YoY & 5% QoQ. Management expects core-fee income to remain stable going forward. Healthy NII growth, stable NIM's, consistent core-fee income growth coupled with cost optimization (C/I – 47.9%) has led to healthy growth in PPP which grew by ~23% YoY.Asset Quality remained stable with GNPA & NNPA at 1.08% & 0.33% resp. Slippages in Q2 were low at 0.8% (annualized) with remarkable improvement seen in corporate & CV portfolio. Total Credit Cost for Q2 & H1 stood at 10 bps & 25 bps resp. while PCR stood at 70%. Restructured book increased slightly to 0.5% due to 4-5 new accounts getting restructured in this quarter. CRAR under Basel III stood at ~13.0% with ROE & ROA at ~18% & 1.9% respectively.Management Guidance: 1) NIMs likely to remain stable with upward bias due to likely asset rebalancing & lower cost of deposits. 2) CV cycle showing signs of bottoming out with revival expected over next few months (~20% of book). Have witnessed some uptick in Auto segment incl. CV in Sept'14 after almost 12-15 months. 3) Branch expansion to continue - added 85 branches in H1 to 687 branches & expects the total branches to reach 800 by FY15 end. 4) Credit cost for FY15E to be ~50-55 bps."
"Strong advances growth, healthy NIMs coupled with stable asset quality has led to superior performance in the current quarter. Strong execution track record coupled with well-defined strategy over FY14-17E (advances growth CAGR ~25-30%) to auger well for the bank's growth over the next 3-4 years. Sustainable & profitable above-industry growth with stable asset quality & improving return ratios to result in likely re-rating of the stock going forward. Moreover, we have been conservative on asset quality assumptions, thus providing upside risk to our estimates. Hence, considering the sound fundamentals & strong growth prospects, we remain positive on the stock & recommend 'Hold' with a revised price target of Rs.750 based on our FY17E estimate," says Sushil Finance research report.
For all recommendations, click here
Disclaimer: The views and investment tips expressed by investment experts/broking houses/rating agencies on moneycontrol.com are their own, and not that of the website or its management. Moneycontrol.com advises users to check with certified experts before taking any investment decisions.
To read the full report click here
Prabhudas Lilladher is bullish on IDFC and has recommended accumulate rating on the stock with a target of Rs 160 in its October 31, 2014 research report.
"IDFC reported another muted quarter (13% YoY decline in PAT) as the company pursues its transition into a bank and focuses more on building up its provisioning cushion (increased to 3.6% of loans vs 3.1% in 1Q FY15) and the G-sec portfolio (~Rs125bn currently vs ~Rs75bn in Q2 FY14). On core performance, PPOP growth of 20% YoY was led mainly from extraordinary treasury & investment gains during the quarter, while NII de-grew by 5% YoY on consolidation in loan growth (3.5% YoY de-growth). Opex increased by 42% YoY on key hiring on the transit into a bank."
"Asset quality deteriorated marginally as company restructured loans worth Rs4.63bn during the quarter thus taking the o/s stock of restructured assets to 6.1% from 5.3% in Q1FY15. 87% of restructured loans pertain to energy segment. Management sighted that there could be some restructuring in gas based assets as gas price hike has been delayed but solution has emerged which will help prevent these assets turning into NPAs (Gas based exposure stands at Rs2.4bn or 3.3% of loan book). Also, coal related exposure stands at ~5% of loan book though is not directly linked to coal mine de‐allocation. The company intends to add provisioning buffer on prudential basis for all known risks as it transforms into a bank to avoid any hiccups later on. The board has approved the demerger scheme and all shareholders of IDFC will get shares in the bank in ratio of 1:1. However the demerger plan needs to be cleared by SEBI, RBI, High court etc. Most of investments will be moved to NOHFC like AMC, Investment Banking & Alternate assets. Though in the medium term we believe operational challenges remain but its transition into a bank is well on its way as it adds key executives, focusing on regulatory requirements and build up of adequate provisions. We await further clarity on its strategy of operating the bank but reasonable valuations (1.2x ABV) makes us retain our 'Accumulate' rating on the stock with TP of Rs160 (1.3x Sep‐16 book)," says Prabhudas Lilladher research report.
For all recommendations, click here
Disclaimer: The views and investment tips expressed by investment experts/broking houses/rating agencies on moneycontrol.com are their own, and not that of the website or its management. Moneycontrol.com advises users to check with certified experts before taking any investment decisions.
To read the full report click here
Banking secretary, GS Sandhu has written to RBI governor asking the central bank to review its "stringent" lending rules to infrastructure companies.
Ever since it took office, the Narendra Modi government has made it clear that building infrastructure will be one of its top priorities. In a bid to come good on that promise, the banking secretary, GS Sandhu has written to the RBI governor asking the central bank to review its "stringent" lending rules to infrastructure companies.
In an interview to CNBC-TV18, Diwakar Gupta, former MD & CFO of State Bank of India, says the industry had been through a tough phase over the past four years and that it is a given fact it would require some handholding "without worrying about consequences".
Gupta feels each restructuring is a one-off and cannot have conditions and one simply cannot straitjacket restructuring with percentages. He thinks existing projects should be allowed in long tenor loan structuring.
KRChoksey is bullish on Dr Reddys Labs and has recommended accumulate rating on the stock with a target of Rs 3485 in its October 30, 2014 research report.
"DRL's Q2FY15 revenues showed growth of 6.9% YoY to Rs. 3,588 crs in line with our estimates. North America & Russia business showed growth lower than our estimates while PSAI, ROW & domestic business showed performance better than expected. EBIDTA degrew by 4% YoY to Rs.816 crs mainly on account of lower gross margins, higher R&D & operating expenses. EBITDA margin stood at 22.7% contracted by 250bps YoY. R&D expenses were high at 11.5% of revenues due to scale up in development activities of complex generics like topicals, patches, injectables, biosimilar's early phase trials & late phase trials in prop products. The company has outstanding cashflow hedges of around USD 610mn at an average rate of Rs. 59-61/USD and balance sheet hedges of around USD 524mn. Reported PAT stood at Rs. 574 crs down by 17% YoY higher than our estimates on account of lower tax provisioning. After adjusting tax write back during corresponding quarter last year APAT was down by 8% YoY. EPS for the quarter stood at Rs 33.8."
"North America showed subdued revenue growth of 7% YoY in dollar terms to USD 235mn during the quarter on account of channel consolidation – price erosion in some of its base products & lack of new launches. Management highlighted that ANDA approvals were slower than anticipated during H1FY15. However company has seen market share expansion in its key launches namely Metoprolol succinate, Ziprasidone & Divalproex ER. Company has launched 1 product during the quarter. Company has done 2 ANDA filings during the quarter. Company has entered in to an asset purchase agreement with Novartis to acquire rights & market Habitrol franchise an OTC nicotine replacement therapy transdermal patch with modest market size in US. Company has launched Rapamune tablet 1mg & 2mg which is a low competition market. We believe US market will recover in H2FY15 with ramp up in new launches. Cumulatively 72 ANDAs are pending for approval of which 45 are Para IVs & 11 are FTFs. Europe has shown degrowth of 19% YoY during the quarter. We believe company will continue to face challenges in EU business due to tender business."
"Domestic business showed strong growth of 14% during the quarter driven by healthy volume expansion in its focus brands, some of which listed in NLEM portfolio. Total MRs stands at 4000. Management is focusing to improve its volume growth in high profile brands and also by launching new products in different therapies like CVS, Hypertension & other chronic therapies. Therefore we expect domestic revenue CAGR of 14% over FY14-16E. Russia degrew by 11% YoY on account of rouble devaluation. We believe sales in Russia will recover in H2FY15. Company has strong foothold in the market & has local MRs to cater to both prescription & OTC market in Russia. Currently DRL has 37% OTC exposure of sales and planning to increase its OTC exposure in order to stay away from price regulation. Emerging markets Ex- Russia grew by 57% YoY during the quarter due to strong performance in Venezuela. We believe company will have focused approach on emerging markets viz. South Africa & Venezuela through their sales force excellence. Cumulatively 72 ANDAs are pending out of which 45 are Para IVs & 11 FTFs. We believe US business growth to pick up in H2FY15. Company has strong focus on niche launches & building its pipeline in injectables, biosimilars & derma space. Also, strong domestic business will help the company to drive growth in future. At CMP of Rs. 3,053 DRL is trading at 22.9xFY15E & 19.3xFY16E EPS. We recommend 'ACCUMULATE' rating with the revised target price of Rs. 3,485 at 22xFY16E (earlier Rs. 3,515)," says KRChoksey research report.
For all recommendations, click here
Disclaimer: The views and investment tips expressed by investment experts/broking houses/rating agencies on moneycontrol.com are their own, and not that of the website or its management. Moneycontrol.com advises users to check with certified experts before taking any investment decisions.
To read the full report click here
ICICI Prudential Tax Plan announces dividend, the record date for dividend is November 07, 2014.
The bank has reported a net loss of Rs 245.51 crore for the second quarter ended September against a net profit of Rs 132.55 crore on year-on-year basis due to higher tax expenses and provisions for bad assets.
S&P has downgraded Indian Overseas Bank (IOB) to BB+/B from BBB-/A-3 on weak asset quality.
The bank has reported a net loss of Rs 245.51 crore for the second quarter ended September against a net profit of Rs 132.55 crore on year-on-year basis due to higher tax expenses and provisions for bad assets.
The bank's asset quality has deteriorated significantly with gross non-performing assets (NPAs) or bad loans rising to 7.35 percent of total advances, while it was at 4.65 percent a year ago. Even the net NPAs in Q2FY15 also increased to 5.17 percent from 2.83 percent a year ago.
The new version comes with Maruti's automatic transmission technology first seen in the Celerio
A lot rides on the success of new Alto K10 for Maruti Suzuki India . The Alto brand umbrella accounts for largest sales in the Maruti portfolio - the Alto 800 and the K10 together clock about 22,000 units a month, reports CNBC-TV18's Sindhu Bhattacharya
The all new K-10 is a more powerful iteration of Maruti's best seller. The new version comes with Maruti's automatic transmission technology first seen in the Celerio. The company hopes the new K10 will help arrest the slippage in the entry level car market, which has shrunk from the earlier peak of 30,000 units a month.
While the company is confident of a pick up in sales it is still grappling with concerns. vehicle finance rates remain high and general sentiment in the passenger car market subdued, even the recent decline in fuel prices has not helped car makers improve sales - Maruti sales remained flat this festival season.
Not just the AMT, Maruti is also offering the Alto K10 in a CNG version where mileage is claimed to be even better at 32.26 km per kg. The new Alto K10 comes in six variant and is bit more expensive than the outgoing model but pricing remains attractive with the entry level automatic transmission coming for just Rs 3.06 lakh (ex-showroom Delhi).
Maruti Suzuki stock price
On November 03, 2014, Maruti Suzuki India closed at Rs 3285.60, down Rs 52.75, or 1.58 percent. The 52-week high of the share was Rs 3349.00 and the 52-week low was Rs 1541.25.
The company's trailing 12-month (TTM) EPS was at Rs 96.45 per share as per the quarter ended September 2014. The stock's price-to-earnings (P/E) ratio was 34.07. The latest book value of the company is Rs 694.45 per share. At current value, the price-to-book value of the company is 4.73.
