MOSL: Morning India (6/September/18): 1. PNB Housing (Strong growth, improving profitability); 2. Muthoot Finance (Good operating performance); 3. AGIC 2018: Telecom/Media; 4. EcoScope
MOrning India (6/September/18): 1. PNB Housing (Strong growth, improving profitability); 2. Muthoot Finance (Good operating performance); 3. AGIC 2018: Telecom/Media; 4. EcoScope
Today’s top research idea
PNB Housing Finance: Strong growth, improving profitability; Spreads improved in FY18, but outlook challenging
- PNB Housing Finance (PNBHOUSI IN) reported a strong 59% PAT growth in FY18 with 50% growth in AUM YoY, ~40bp spread expansion and stable asset quality. The company managed to expand spreads as almost all NCDs issued in FY18 were at a cost below 8%.
- Only 3% of secured NCDs will mature in FY19, thus minimizing refinancing risk in FY19. PNB and Quality Investment Holdings (Carlyle) have invited bids for a joint stake sale of at least 51% of the company.
- Non-binding bids will be submitted in September and the transaction should culminate in three months. We expect RoA to decline to 1.3% by FY20; however, RoE should increase to 17% due to higher leverage. Rising GSec yield is the biggest risk to our estimates given the thin spreads in this business.
Piping hot news
Sebi says will review new regulations for foreign portfolio investors
- Amid concerns among some FPI (foreign portfolio investor) groups, capital markets regulator Securities and Exchange Board of India (Sebi) on Wednesday said it will review the proposed new norms for foreign portfolio investors and take a holistic view after taking into account views of all stakeholders, including the government.
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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