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INDIA CEMENTS: Weak volumes remain a key concern; Margins impacted by higher costs (ICEM IN, Mkt Cap USD0.7b, CMP INR179, TP INR190, 6% Upside, Neutral) Click here to access detailed report - India Cements (I

MOrning India (12/August/21): 1. MAX Financial Services (Steady performance; VNB margin moderates on seasonal factors); 2. Mahindra & Mahindra (AR); 3. Power Grid; 4. Pidilite; 5. Siemens; 6. Cadila Healthcare; 7. Lupin; 8. Trent

 

Today’s top research idea

MAX Financial Services: Steady performance; VNB margin moderates on seasonal factors

• MAX Life Insurance (MAXLIFE) continued to demonstrate a resilient performance in a challenging macro environment, led by healthy 32% APE growth. This was owing to robust growth in Non-PAR Savings and recovery in ULIP. However, Protection growth has moderated, similar to that for peers. On the distribution front, the strong push via the bancassurance channel has aided premium growth, while proprietary channel growth was impacted by COVID 2.0.
• The VNB margin declined to ~19.7% in 1QFY22 (v/s 24% in 4QFY21), largely affected by seasonality due to the drag from operating cost and rising ULIP mix. Overall, we expect the VNB margin trajectory to remain stable and estimate a 21% CAGR in APE over FY21-23E. This would enable a 23% VNB CAGR over FY21-23E. Maintain Buy.

Piping hot news

Government finalising plan to monetise Rs 6 lakh crore infra assets: DIPAM Secy

The government is finalising Rs 6 lakh crore worth infrastructure assets, including national highways and power grid pipelines, which would be monetised, a top official said on Wednesday. "A national monetisation plan of about Rs 6 trillion is in the offing which will have a range of assets from pipelines to power grid pipelines to national highways, ToT and so on," Department of Investment and Public Asset Management (DIPAM) Secretary Tuhin Kanta Pandey said.