MOSL: Morning India (02/November/18): 1. HDFC; 2. IndusInd Bank; 3. India Politics; 4. United Spirits; 5. Marico; 6. HPCL; 7. GSK Consumer; 8. Dalmia Bharat; 9. Cummins India; 10. Tata Comm
MOrning India (02/November/18): 1. HDFC; 2. IndusInd Bank; 3. India Politics; 4. United Spirits; 5. Marico; 6. HPCL; 7. GSK Consumer; 8. Dalmia Bharat; 9. Cummins India; 10. Tata Comm
Today’s top research idea
HDFC – Healthy core operating performance
- HDFC's PAT increased 25% YoY to INR24.7b (a 9% miss due to prudent provisioning from one-off gains), driven by healthy AUM growth (17% YOY and 3% QoQ) and stable spreads (2.28%).
- NII grew 21% YoY (3% beat). Adjusted for upfront gain on assignment, NII increased 16% YoY, largely in line with AUM growth of 17%.
- GNPA ratio declined 5bp QoQ to 1.13%, driven by a 14bp QoQ decline in corporate GNPLs to 2.18%.
- On a YTD basis, HDFC has taken a yield hike of 65-70bp on retail loans and 130-150bp on corporate loans (of which 50-60bp is in 3Q) this should help spreads in rising cost of funds
- HDFC's loan growth is impressive, despite intense competition and a high base. The current liquidity situation presents HDFC with the opportunity to gain market share as competitive intensity moderates. Given vintage and strong relationships, HDFC has been able to raise money from multiple sources comfortably, albeit at slightly higher rates. It also has a huge public deposit base approaching INR1t - this source of sticky retail money will be a huge advantage over peers. Buy with an SOTP-based TP (Sept'20E based) of INR2,140.
Piping hot news
GST collection crosses Rs 1-trillion mark for the second time in 2018-19
- Goods and services tax (GST) collection crossed the trillion mark for the second time in 2018-19. The mop-up touched Rs 1.01 trillion in October, up 6.6 per cent from September’s collection of Rs 944 billion. Experts attributed this to pick-up in demand in the run-up to the festival season, and the closing of input tax claims for 2017-18. In April, Rs 1.03 trillion was collected.
Motilal Oswal Financial Services Ltd. is a reputed name in Financial Services and Online Trading with group companies providing services such as Private Wealth Management, Retail Broking and Distribution, Institutional Broking, Asset Management, Investment Banking, Private Equity, Commodity Broking, Currency Broking, Principal Strategies & Home Finance.
Motilal Oswal Securities is a group company of Motilal Oswal Financial Service Limited which started as a stock trading company and has blossomed into well diversified firm offering a range of financial products and services. Motilal Oswal has built a reputation as the source for best stock trading company and this has taken a wealth of experience, knowledge and expertise, constantly working in tandem, over the years.
Unfortunately, this report is not available for the investor type or country you selected.
Browse all ResearchPool reportsReport is subscription only.
Thank you, your report is ready.
Thank you, your report is ready.