MOSL: Morning India (27/October/21): 1. Bajaj Finance (Visible traction on digital platform and omnichannel strategy); 2. Kotak Mah. Bank; 3. Axis Bank; 4. Indus Towers; 5. Ambuja Cements; 6. Cipla; 7. SRF; 8.
MOrning India (27/October/21): 1. Bajaj Finance (Visible traction on digital platform and omnichannel strategy); 2. Kotak Mah. Bank; 3. Axis Bank; 4. Indus Towers; 5. Ambuja Cements; 6. Cipla; 7. SRF; 8. Torrent Pharma
Today’s top research idea
Bajaj Finance: Visible traction on digital platform and omnichannel strategy
- BAF is seeing healthy traction of its omni-channel strategy both for acquisition of EMI card customers (~372K) as well as for loans on the EMI Store (~248K). Payments stack of BAF will leverage everything across PPI, UPI, EMI cards and credit cards along with a rewards program. From QR-based payments, to presence at the point of sale and eventually to a payments gateway - BAF is looking to morph its erstwhile REMI business into a full-fledged payments offering.
- Barring any new COVID disruption, we expect BAF to deliver ~24% AUM growth in FY22E and a 25% CAGR thereafter. We have marginally increased our credit cost estimates for FY22E to 2.8% (v/s 2.6% earlier). We estimate ~4.4%-4.7% RoA / 21%-23% RoE over FY23-FY24E. Given our expected recovery in asset quality in 2HFY22 and the sustained milestones-driven progress made by BAF in the digital transformation program we maintain BUY with Target Price of INR8,650.
Piping hot news
Festive season fuels India’s return to world-beating growth
India showed more signs of a recovery taking hold last month as its consumption-driving festive season kicked off, keeping it on track to regain the title of the world’s fastest-growing major economy. Exports rose about 23% year-on-year in September, while also improving 1.6% from a month earlier, led by demand for petroleum products, engineering goods, coffee and gems and jewelry.
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.
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