MOSL: Morning India (2/November/17): 1. Rain Industries (Enduring tailwinds)- 2. Auto volumes nos. (Nov-17)- 3. Bharti Airtel- 4. GAIL- 5. Hero MotoCorp- 6. Godrej Consumer- 7. Tech Mahindra- 8. TVS Motor
​MOrning India (2/November/17): 1. Rain Industries (Enduring tailwinds); 2. Auto volumes nos. (Nov-17); 3. Bharti Airtel; 4. GAIL; 5. Hero MotoCorp; 6. Godrej Consumer; 7. Tech Mahindra; 8. TVS Motor
Today’s top research theme
- Rain Industries (Initiating Coverage): Enduring tailwinds; Re-rated, yet attractive
- RAIN is globally the second largest producer of calcine pet coke (CPC) and coal tar pitch (CTP), which are used in aluminum smelting.
- The dual benefit of demand growth and supply shock is driving CPC prices and margins.
- Capacity cuts in RAIN’s key markets have turned the margin outlook favorably for CTP.
- Global leadership, product innovation, and long-standing relationships with leading customers and raw material suppliers are the key barriers to entry.
- RAIN is investing in high-IRR projects to capitalize on the exponential rise in CPC demand in India and in debottlenecking coal tar distillation in Europe.
- Although the stock has got re-rated, valuations still appear attractive. We value the stock at INR362 based on 6.5x EV/EBITDA of CY19E, and initiate coverage with a Buy rating.
Piping hot news
US states sue 5 Indian generic drug makers over price cartelisation
At least five Indian companies are among 12 generic drug manufacturers named in a new lawsuit over alleged price cartelisation in the US, adding to their existing headaches including regulator inspections and pricing pressures in their largest market.
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.
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