MOSL: Morning India (28/November/18): 1. RBL Bank (ROA improvement on track); 2. UPL (Set to play in the big league); 3. Blue Star (Prioritizing profitable growth with market share gains)
MOrning India (28/November/18): 1. RBL Bank (ROA improvement on track); 2. UPL (Set to play in the big league); 3. Blue Star (Prioritizing profitable growth with market share gains)
Today’s top research idea
RBL Bank: ROA improvement on track
We met Mr. Rajeev Ahuja, ED of RBL Bank; Key takeaways:
- He believes there is re-intermediation of credit from the bond markets, which should drive credit growth for the banking system going forward. RBL bank is very much on track to achieve 35%+ loan CAGR over FY18-FY20E on back of growth across asset products.
- The momentum in credit card and micro finance institution (MFI) business remains strong while management sounded a bit cautious on SME exposure owing to inadequate collateralization levels and yet to return normalcy post the impact of demon and GST.
- Margin improvement for RBL Bank would primarily be driven by changing its loan mix towards higher yielding loans, thus, resulting in higher yields.
- The cost of funds will remain elevated in near term however the increased pricing power is helping banks to completely pass through the costs.
Piping hot news
Lodha puts London properties up for sale to bring down debt
- One of India’s largest realtors and probably the most aggressive one, Lodha Developers, is selling its London assets to prune borrowings. The Mumbai-based realty company is close to completing the formalities to sell its two residential projects in London — Lincoln Square on Carey Street and 1 Grosvenor Square in Mayfair — to an international fund.
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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