FATCA is ok with me even though i had some difficulty with foreign investment calculations. This is related to opening a demat account in india from US. ICICI is not allowing this and insisting on coming to india for US based nri’s.

Here are my numbers and logic. Am assuming market values are high level approx. on P/BV and not DCF

1. IDFC’s standalone business book value is 2640 crores
2. IDFC Bank’s book value is 13,300 crores
3. Today’s valuation is approx. 22,600 crores (~162 crore shares * 140 market price) = tomorrow’s valuation (ignoring analyst’s who are projecting the value and not today’s price)
4. Tomorrow’s direct ownership of IDFC Bank (A) + IDFC’s share of IDFC Bank (B) + Rest of IDFC (C) should be 22,600 to IDFC’s today’s shareholders.
5. C = Rest of IDFC can be valued at 4000-6000 crores (fee driven business – 1.5 – 2.5 BV, a quick estimate, this can even be higher or lower – need to value the assets separately)
6. A+ B = 16,600 – 18,600 crores
7. B = A *.53 / .47 * .75 (53% is IDFC’s share, 47% is direct by share holders, and assume a 25% holding company discount) = ~ .85 A
8. 1.85 A = 16,600 – 18,600 -> A = 9,000 – 10,000 crores & B = 7,600 – 8,600 crores
9. IDFC should be valued = B + C = 11,600 – 14,600 crores, at a per share level 70-90 (162 Crore shares)
10. IDFC Bank shares would be valued at 55 – 60 (again A – 9000 – 10000 cores divided by 162 crore shares). Note am using the direct holding and direct ownership shares to calculate value.

As per the ICICIdirect report dated 28 Sept on Alembic pharma, both Torrent and Alembic have a market share of ~10% each for Abilify. Apotex is still too small.

As per Motilal Oswal latest report and their meeting with management,

IDFC Bank is expecting the growth of 25-30% ( which would be at cost of profits and to gain market share )

Motilal oswal has given fair value for IDFC Ltd as 119 per share and IDFC Bank as 89 per share