While entire Listed REIT space is ignored since last couple of years, still among the listed REIT’s, Brookfield is most neglected.

I personally think REIT should have space in one’s fixed income protfolio, but market’s apathy seems to point in other direction.

For ME, fundamentally risk rewards in Brookfield are favourable at Rs 250 per unit, however, price action (technical indicators) signals that reverse is true.

Things that I dont like in Brookfield include:

1. Concentration of top tenants – Even after recent deal, top 4 tenants commands 35% of the space, which looks too much concentration.
2. Quality of Tenants – Top 5 tenants are IT services firms, which are very price sensitive. GCC’s in general offer much better tenant profile, as they are not price conscious and are reaady to pay up for better quality properties.
3. Income support from promoter – The distributions are supported by promoters as a large portion of the properties are vacant. This income support is available for net 1.5 years, post which, DPU will fall if vaccanies are not filled.
4. Under construction properties – are located in Kolkata which offers lowest rent.

Disclosure – Invested

ESAF Small Finance Bank Ltd

ABOUT [ edit ]

Incorporated in 1992, ESAF is a Small Finance Bank mainly focusing on providing loans to rural and semi-urban customers.[1]

KEY POINTS [ edit ]

History [1] Promoted by ESAF Financial Holdings Pvt Ltd (“EFHPL”), ESAF Small Finance Bank (“ESAF SFB”) was granted RBI’s Approval to carry on business as an SFB, on November 18, 2016. The “ESAF” brand has been built over more than 27 years, beginning in 1995 when the ESAF Foundation started its microloan activities.

Focus on Rural Areas [1] As of June 30, 2023, their gross advances to their customers in rural and semi-urban centers accounted for 62.97% of advances and 71.71% of the banking outlets.

Product Portfolio
A)Asset Product Portfolio [1]
• Micro Loans, which comprise Microfinance Loans and Other Micro Loans;
• Retail Loans, which includes Gold Loans, Mortgages, Personal Loans, and Vehicle Loans;
• MSME Loans;
• Loans to Financial Institutions; and
• Agricultural Loans.

B) Liability Portfolio [1] Current accounts, savings accounts, term deposits, and recurring deposits.

Key Data Points [2][3]
No. of Outlets – 700
No. of Employees – 5160
Lending Accounts – 0.37 Crs
Deposits Accounts – 0.68 Crs
AUM – 17,203.97 Crs
AUM per Banking Outlet – 24.58 Crs
Deposits – 15,655.85 Crs
Deposits per Banking Outlet – 22.37 Crs
Gross NPA – 1.65%
Net NPA – 0.81%
PCR – 74.35%

AUM Bifurcation [4]
Micro Loans – 75% in FY23 vs 81% in FY22
Retails Loans – 16% in FY23 vs 12% in FY22
MSME Loans – 1% in FY23 vs 1% in FY22
Loans to Financial institutions – 3.5% in FY23 vs 3.5% in FY22
Agricultural Loans – 4% in FY23 vs 2% in FY22

Distribution Network [5] ESAF SFB has a network of 700 banking outlets (including 59 business correspondent-operated banking outlets), 767 customer service centers (which are operated by their business correspondents), 22 business correspondents, 2,116 banking agents, 525 business facilitators and 559 ATMs spread across 21 states and 2 union territories, serving 0.72 crore customers as of June 30, 2023.

Operations managed by Business Correspondents [3] The bank uses business correspondent (BC’s) entities to source and service customers for micro loans, they also source customers for mortgage loans, vehicle loans, MSME loans, agricultural loans and select deposit products. In addition, business correspondents are responsible for sourcing and servicing banking agents and the BC’s sourced or serviced 74.75% of gross advances end June 2023.

Revenue Concentration [6] The business is concentrated in southern region with 62.43% of banking outlets located in South India (including 43.43% in Kerala and 13.86% in Tamil Nadu), 73.09% of gross advances are from customers in South India (including 43.45% from Kerala and 22.14% from Tamil Nadu)

IPO Details [7] Co. intends to raise 463 Crs through the IPO of which 370.9 Crs of fresh issue will be utilised for:

1) Augmentation of the Bank’s Tier-I capital base to meet the Bank’s future capital requirements.
** 2)** Compliance with regulatory requirements on capital adequacy prescribed by the RBI from time to time

Last edited 4 months, 3 weeks ago
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avoid these meat franchises which have high cost structure. Rather look at Specialty Rest. Thye have a Indian brand management , lots of hit restaurants bars, cloud kitchen and amazing variety and quality and most importantly making profits despite heavy renovations in India and around the world. this one is a good one . they make profits and thats important. we have been sold the middle class scaling story because of Jubilant Domino success. cant be repeated for RBA … Go with quality and where the well to do dine and order in

How will it end its FY24? Any estimated sales and EBITDA margin?

Its not good that they are doing a fund raise when capacities are not fully booked. Next year post US elections, expect that import taxes to be raised and a slow down to hit developed markets , give the severity of the rate rises and end of stimulus payments which is designed to give them a soft landing. that is not certain and any import duties will crash the world international trade including housing and such items. be careful. wait for next year before getting into this.