Posts in category All News
Rural distress: Madhya Pradesh has been let down by monsoon (23-11-2015)
Who is the number 2 in the Modi government? (23-11-2015)
AAI, states to develop four airports in partnership (23-11-2015)
Retain ‘neutral’ on Bharat Forge, target Rs 852: Nomura (23-11-2015)
Maintain ‘neutral’ on Bharat Forge with a target price of Rs 852 per share despite the correction in the stock price. We value the stock on a P/E basis and attribute the ~17x target multiple to the average FY17-18f EPS of Rs 50 to arrive at target. Currently, risks to exports (60% of revenue in FY15) balance out potential upside in the domestic non-auto segments, in our view.
Volvo recently commented on its October truck deliveries that “Production in North America will be adjusted as a consequence of lower demand and high inventories in the distribution channel”. We believe this raises red flags suggesting industry demand will be weak in 2016. We had been highlighting that while the current North America order book remains quite strong (~5x production levels), a slowdown in order inflows could pose a risk to industry production levels in 2016.
Previously, October 2015 order inflows for class-8 trucks in North America (preliminary data as per Freight Transportation Research) fell sharply by 45% y-o-y to 25,010. While this is the eighth consecutive month of decline (order inflows fell by ~24% y-o-y over the March-Oct 2015 period), 45% decline in October is the highest seen during the period.
Maintain ‘buy’ on Nestle, firm poised for strong growth: Jefferies (23-11-2015)
We maintain ‘buy’ on Nestle India but cut our revenue and earnings forecast by c.5-10% to factor in year-to-date performance and the prolonged market weakness. We roll forward our DCF-based target price and now value the stock at Rs 7,020 (implied 40x CY17e EPS).
Management of Nestle outlined key priorities for the firm at its analyst meet. With sharp focus on the urbanconsumer, much emphasis was laid on innovation and volume-led growth.While the path to recovery could be challenging, we believe Nestle is poised for strong growth led by a renewed innovation drive and revival in urbanconsumption.
At the recent analyst meet, the management of Nestle outlined immediate priorities as the firm emerges out of the Maggi issue. While admitting the challenges involved, the management seemed confident of getting back on the recovery path. With single-minded focus on the urban consumer, Nestle plans to revamp its portfolio and distribution network. Emphasis on volume-led growth and innovation was encouraging. Maggi was re-launched on 9th Nov ’15 after the Bombay high court set aside the ban.
The product has been received well and has reached 0.12mn outlets (of the c.3.9mn) so far. However, some issues are yet to be resolved – 1) seven states are yet to lift the ban, 2) R640 crore class action suit with the NCDRD, the test results of which are expected end-Nov and 3) the FSSAI has appealed to the Supreme Court questioning the lower court order.
Bupa to up Max Bupa Health stake to 49% (23-11-2015)
British health insurance company Bupa will acquire an additional 23% stake in Max Bupa Health Insurance from its Indian joint venture (JV) partner Max India, the latter said in a stock exchange filing.
UK’s Bupa will pay Analjit Singh-promoted Max India Rs 191 crore in an all-cash transaction. Max India’s board has approved the divestment and new agreements will come into force after receiving requisite regulatory clearances from the Foreign Investment Promotion Board and the Insurance Regulatory and Development Authority of India (Irdai).
“To further strengthen the relation with the JV partner in Max Bupa, the board of directors has decided to divest 23% stake in favour of UK’s Bupa,” the company stated in stock exchange filing. Max India’s shares closed at Rs 555.65 per share, down Rs 22.90 or 3.96%.
Max Bupa is a 74:26 joint venture between Max India and Bupa. After the deal, Max India’s holding in Max Bupa will decline to 51%, while Bupa’s holding will rise to 49%.
The UK health care group was the first foreign insurer to announce its intent to increase its stake to 49% in its Indian health insurance subsidiary after the government relaxed FDI participation rules for insurance companies.
Overall, this will be the fifth deal by a foreign partner in the Indian insurance space. In August, Standard Life had announced plans to buy an additional 9% stake in its Indian insurance venture HDFC Life to raise its ownership to 35%, valuing HDFC Life at Rs 18,951.4 crore.
In the same month, FIPB approved Tokio Marine’s plan to raise stake in its Indian JV partner Edelweiss Tokio Life Insurance to 49% from 26%. British insurer Aviva also announced its plan to raise stake in its Indian joint venture with Dabur Invest to 49%.
Canada-based insurance and investment company, Fairfax Financial Holdings promoted by Prem Watsa, last month announced it would buy an additional 9% stake of ICICI Lombard General Insurance from ICICI Bank. Fairfax will increase its ownership to nearly 35% stake in ICICI Lombard from 25.7%. The deal is expected to close in the first quarter of 2016.
Hale & hearty
* UK’s health insurer will shell out Rs 191 crore in an all-cash transaction for an additional 23% stake
* Max Bupa is a 74:26 JV between Max India and Bupa. Post deal, Max India stake in Max Bupa will decline to 51%
* Overall, this will be the fifth deal by a foreign partner in the Indian insurance space
Growth in foreign tourist arrivals at 3-year low (23-11-2015)
Torrent Pharma Ltd (23-11-2015)
Q2 investor update:
http://www.torrentpharma.com/pdf/Torrent-Investor-Update-Q2-2015.pdf
Virat Crane Industries Limited (VCIL) – sure shot multibagger (23-11-2015)
Hi Abhishek, I see Kamadhenu ghee also besides Durga but the shelf space is limited and also the packaging is not as attractive as Durga ghee.
- The packaging is white in color
- Cow ghee is used for pujas at home, temples etc. so I believe it's not as much consumer product as Durga is
- I do not know what %ge of sales are split between Durga and Kamadhenu but I surmise lion's share is taken by Durga ghee itself.
- Since this is for pujas, not sure how brand conscious would people be, they would most likely buy 'any' cow ghee except for may be someone who wants a particular brand.
- Since Durga ghee is made to use sweets, mix with baby food, people want best ghee (for kids), tasty ghee etc.
These are just observational thoughts on cow ghee and not much research/enquiry has been done.
Virat Crane Industries Limited (VCIL) – sure shot multibagger (23-11-2015)
thanks Ravi for the update....how is the brand visibility & demand of other brand of the company "Kamdhenu ghee" ...which i think is cow milk ghee... & Durga Ghee is for buffalo milk ghee....