end of the week update - novadhruva.com · 10/9/2020 · end of the week update october 09, 2020....

End of the Week Update

October 09, 2020

Contents

2

Section TitlePage

number

1 Our Views 3

2 Market Update 4

3 Sectoral Update

3.1 Financial Services 6

3.2 Technology, Telecom and Media 8

3.3 Pharma 10

3.4 Healthcare 11

3.5 Auto & Auto Components 12

3.6 Metals & Mining 13

3.7 Aviation 14

3.8 Power and Infrastructure 15

3.9 Consumer and Retail 17

3.10 Real Estate 19

NovaDhruva Team 20

Disclaimer: This presentation is for information and illustrative purpose only. This presentation should not be relied upon to take anydecisions, including investment decisions. Neither we nor any of our affiliates shall be liable for any damage, loss, injury, whetherdirect or indirect, that may be caused to you as a result of any investment made based on this presentation. This presentation isneither an offer to buy or sell or deal nor a solicitation of any offer to buy or sell or deal in securities, financial products, investments,etc. This information is neither addressed to nor should it be presented in any jurisdiction where such presentation will entail anyliability or requirement of registration or approval on us. Even though the information is drawn from reliable sources, we neitherguarantee nor assure the accuracy, completeness or authenticity of the information provided by us in this presentation. Informationcontained in this presentation is subject to change without any prior notice. The information provided in this presentation is notinvestment advice.

Our Views

3

RBI’s policy announcement – hitting all the right chords!

During difficult times, as we are witnessing at present, people often have many expectations from thegovernment and the regulators. It is also incumbent upon the regulators and policy makers to look after theinterests of all their stakeholder in such tough times. Through today’s credit policy, the Governor of RBI has beenable to provide something for everyone.

Putting to rest the debate on growth v/s inflation, the RBI has articulated its policy extremely well. Given thecurrent situation, revival of the economy will be a priority for them. The MPC has decided to look through thecurrent inflation hump as transient and address the more urgent need to revive growth and mitigate the impactof the pandemic on economy. However, they are keeping an eye on inflation and expect it to come down withinthe targeted range by Q3-Q4 of FY2021. Therefore, the overall policy announcements should be viewed in thecontext of focus on growth. Further, the central bank well knows that the Government does not have too muchheadroom on the fiscal front now given that the revenue is coming down and the expenditure is going up.Therefore, its important to support the economy through monetary policies rather than through fiscal stimulus.

To ensure better participation by banks in government borrowing program, the central bank has extended thefacility of up to 22% SLR securities to be held on the Held to Maturity (HTM) basis. This extension up to March 31,2022 will reduce the risk of mark-to-market for banks on such investments, enabling them to participate in theenhanced Government borrowing program. Additionally, the size of Open Market Operations (OMOs) will beincreased to INR 20,000 crores which will further ensure liquidity in the system and reduce the pressure on theyield curve. Both these measures together should easily see through the government borrowing program for therest of the year.

As we know, the State Government Finances are also extremely stretched. To facilitate the borrowing by theState Government, for the first time, the Central Bank has announced OMOs in State Development Loans (SDLs).This is an extremely innovative method suggested by RBI which will also facilitate efficient pricing for the States.

To facilitate liquidity to sectors that require support, RBI has announced on-tap TLTRO with tenors of up to threeyears for a total amount of up to INR 1,00,000 crores at a floating rate linked to the policy repo rate. This schemewill be available up to March 31, 2021.

In a boost for the housing and real estate sector, RBI has changed the risk weights on housing loans to individuals.Under the current framework, differential risk weights are applicable to individual housing loans, based on thesize of the loan as well as the loan-to-value ratio (LTV). RBI has now rationalized the risk weights for all newhousing loans sanctioned up to March 31, 2022 and linked them to LTV ratio only. This will facilitate cheaperhome loans and give a fillip to the real estate sector.

It is noteworthy that while being very focused on the immediate task of managing growth through monetarymeasures, RBI has not lost sight of long-term structural initiatives. While RBI had already introduced a 24x7x365National Electronic Funds Transfer (NEFT) system, the proposal to implement Round-the-Clock Real Time GrossSettlement (RTGS) System will enable a swift and seamless payment in real-time for domestic businesses andinstitutions. This will make us one of few countries in the world to have this facility and will give a big boost to theease of doing business. Apart from Hong Kong and Australia, which have a 24X7 equivalent of RTGS, even othermajor economies like the USA and UK do not have such an efficient system yet. Also, Hongkong’s FasterPayments System (FSP) allows 24x7 payments but is not exactly equivalent to RTGS as there is a limit onpayment. Of course, RBI will have to revise the framework to account for the impact of this facility on fundmanagement by banks and their CRR.

Using monetary tools to boost growth and to address some of the immediate needs, and at the same timefocusing on long-term strategic projects, the policy statement is indeed powerful.

21.2x, Nifty21.5x, Sensex

18.7x, Fin. Services14.6x, Bank

29.5x, FMCG

27.1x, Pharma27.1x, Healthcare

25.2x, IT

29.4x, Auto

19.1x, Media

10.2x, Metals

27.2x, Realty

0.0x

10.0x

20.0x

30.0x

40.0x

09-Oct 21-Dec 03-Mar 15-May 27-Jul 09-Oct

Return (%)Current

Level1D 1W 1M 3M

Since 1

stMarch

6M 1Y

Nifty 11,914 0.7% 4.4% 5.3% 10.2% 7.0% 30.8% 5.3%

Sensex 40,509 0.8% 4.7% 5.6% 10.3% 6.2% 30.0% 6.1%

Dow Jones 28,426 0.0% 2.7% 3.4% 10.6% 6.4% 19.8% 7.9%

Nasdaq 11,551 0.0% 2.6% 4.4% 7.4% 30.1% 40.2% 50.2%

FTSE 6,006 0.5% 1.8% 1.3% (0.7%) (9.7%) 2.8% (16.2%)

Nikkei 23,620 (0.1%) 2.6% 1.5% 4.8% 10.7% 21.1% 10.1%

Hang Seng 24,119 (0.3%) 2.8% (2.1%) (8.0%) (8.3%) (0.7%) (6.1%)

Return (%)Current

Level1D 1W 1M 3M

Since 1

stMarch

6M 1Y

Nifty Bank 23,847 2.8% 7.2% 7.1% 6.5% (17.4%) 19.8% (17.2%)

Nifty Financial Services 11,648 1.9% 6.4% 7.0% 5.0% (13.8%) 18.8% (10.2%)

Nifty FMCG 29,924 (0.7%) (0.3%) (2.3%) (2.9%) 2.7% 3.4% (1.1%)

Nifty Pharma 12,044 (1.4%) 1.9% 6.5% 19.6% 59.8% 36.9% 66.5%

Nifty IT 21,838 0.6% 8.6% 19.6% 40.3% 41.5% 71.6% 44.3%

Nifty Auto 8,164 (0.2%) 2.5% 3.3% 15.9% 19.1% 46.6% 9.4%

Nifty Media 1,555 (0.9%) (2.3%) (4.2%) 13.7% (2.5%) 40.7% (10.4%)

Nifty Metal 2,261 (0.5%) (0.0%) (5.7%) 8.8% 2.9% 32.6% (2.5%)

Nifty PSU Bank 1,333 3.1% 3.2% (4.5%) (10.5%) (28.2%) 2.4% (39.9%)

Nifty Private Bank 13,211 2.6% 7.4% 7.7% 7.4% (16.7%) 23.5% (17.9%)

Nifty Realty 215 (1.6%) (0.1%) 2.1% 4.5% (23.0%) 16.0% (13.9%)

BSE Telecom 1,047 (0.3%) (0.9%) (14.4%) (21.1%) (10.5%) (2.6%) 10.7%

BSE Healthcare 20,301 (1.0%) 2.1% 8.4% 22.5% 51.3% 39.5% 67.9%

0

500

1,000

1,500

2,000

60

80

100

120

140

160

09-Oct 21-Dec 03-Mar 15-May 27-Jul 09-Oct

Market Update

Key Market Trends

4

Global and Indian Indices Performance

Rebased to 100 Last 1 Year Since 1st MarchRebased to 100

Nifty Sensex Dow Jones NASDAQ FTSE Nikkei Hang SengNIFTY Volume(RHS) -Mn

0

500

1,000

1,500

2,000

60

80

100

120

140

02-Mar 15-Apr 29-May 12-Jul 25-Aug 09-Oct

Mar 11:WHO declared

COVID-19 asa pandemic

Mar 24Lock-down

1.0

Apr 14Lock-down

2.0

May 01Lock-down

3.0

May 18Lock-down

4.0

Source: Bloomberg as of October 09, 2020

Indian Sectoral Performance

NTM PE Ratio – Last 1 Year

The Indian indices rose 4.4% to 4.7%

this week after the monetary policy

committee (MPC) of the RBI left the repo rate unchanged and announced a slew of

liquidity measures to support the

economy

Banking and financial services

sectors showed the highest gains this

week

NTM PE Ratio chart shows the evolution

of NTM valuation multiple on each

day for the last 12 months

Market Update

Key Market Trends

rket Trends

5

Yield (%) Current 1D 1W 1M 3MSince

1st

March6M 1Y

1YR AAA Rated Corp. Bond NA 4.24% 4.22% 4.38% 4.39% 6.08% 6.01% 6.76%

1YR G-Sec 3.57% 3.59% 3.63% 3.73% 3.63% 5.27% 4.78% NA


3YR G-Sec 4.46% 4.55% #N/A 5.04% 4.62% 5.63% 5.50% 5.88%


5YR G-Sec 5.21% 5.26% 5.27% 5.46% 4.85% 6.16% 6.37% 6.32%

10YR AAA Rated Corp. Bond 6.86% 6.86% 6.86% 6.90% 6.66% 7.29% 7.54% 7.52%

10YR G-Sec 5.94% 6.02% 6.00% 6.06% 5.76% 6.34% 6.42% 6.51%

India Government and Corporate Bond Yields (%)

Currency Market Snapshot

% Change in FX Current FX Rate 1D 1W 1M 3MSince

1st

March6M 1Y

USD-INR 73.13 0.2% 0.2% 0.6% 2.8% (0.5%) 4.3% (2.8%)

EUR-INR 86.28 (0.2%) (0.3%) 0.4% (1.6%) (6.5%) (3.9%) (9.6%)

GBP-INR 94.61 0.4% 0.3% 0.7% 0.1% (1.9%) 0.0% (8.2%)

JPY-INR 0.69 0.2% 0.2% 0.1% 1.9% (3.0%) 1.9% (4.2%)

SGD-INR 53.96 (0.0%) (0.3%) (0.5%) 0.1% (3.1%) (0.7%) (4.6%)

CNY-INR 10.91 (1.2%) (1.1%) (1.4%) (1.5%) (4.3%) (0.7%) (8.7%)

Commodity Market Snapshot

Liquidity Position (USD mn)

Trading Activity by FII/DIIs in Capital Market Segment (USD mn)

Trading Activity by FIIs in Debt Segment (USD mn)

Oil

Gold

InvITs

REIT

Source: Bloomberg of October 09, 2020; 1Financial Benchmarks India Overnight Mumbai Interbank Outright Rate; 2Mumbai Interbank Forward Offer Rate

% Change Current 1D 1W 1M 3MSince

1st

March6M 1Y

WTI Crude (USD/barrel) 40.84 2.2% 5.5% 9.8% (0.6%) (13.8%) 18.9% (19.3%)

ICE Brent Crude (USD/barrel) 43.02 (0.7%) 9.5% 6.6% (2.0%) (17.1%) 12.0% (22.8%)

Spot Gold (USD/ounce) 1,915.86 1.2% 0.8% (0.8%) 6.5% 20.5% 13.8% 27.3%

India InvITs and REIT Performance

% Change Current

Price1D 1W 1M 3M

Since 1

stMarch

6M 1Y

Indigrid 105.99 (0.0%) 0.5% 5.2% 6.2% 3.4% 19.1% 12.2%

IRBInvIt 34.23 0.9% 0.4% (5.8%) (25.4%) (17.7%) 26.0% (41.9%)Embassy Office Parks 359.95 (0.8%) (0.7%) (0.5%) (21.7%) 5.9% 1.9% (14.2%)

10 Year bond yields fell after RBI MPC’s

announcement

Oil prices gained this week due to risk

that supplies from Norway could be slashed by c.25%

due to oil workers' strike

FPIs/FIIs were net buyers whereas DIIs were net sellers this

week

FIIs were net sellers in the debt segment

Last 1 Week 08-Oct-20 07-Oct-20 06-Oct-20 05-Oct-20 01-Oct-20 30-Sep-20

Net Liquidity 53,651 52,056 53,145 56,111 50,850 45,167

Absorption through RBI Reverse Repo 74,530 72,911 73,963 76,977 71,757 65,929

MIBOR1

(%) 3.69 3.65 3.70 3.73 3.70 3.79

MIFOR2

1M 3.65 3.58 3.59 3.66 3.70 3.74

MIFOR2

3M 3.90 3.92 3.94 3.95 4.00 4.00

MIFOR2

6M 4.41 4.46 4.48 4.51 4.52 4.41

MIFOR2

12M 4.58 4.57 4.59 4.61 4.60 4.59

Last 1 Week Weekly Total 09-Oct-20 08-Oct-20 07-Oct-20 06-Oct-20 05-Oct-20

FII/FPI (463.0) (35.3) (91.2) (39.3) (54.1) (243.1)

Last 1 Week Weekly Total 09-Oct-20 08-Oct-20 07-Oct-20 06-Oct-20 05-Oct-20

FII/FPI 459.6 (5.4) 133.6 149.2 150.0 32.3

DII (325.6) 17.3 2.7 (154.0) (127.3) (64.3)

Total 134.0 11.9 136.3 (4.9) 22.7 (32.0)

Sectoral Update – Financial Services

India Financial Services Update

6

India – Bank Stocks India – NBFC Stocks

12.5%

9.2%

(0.5%)

8.5%

3.1%

(3.7%)

HDFC Bank

ICICI Bank

KMB

Axis Bank

Indusind

Yes Bank

11.2%

(3.1%)

2.5%

0.4%

1.9%

(2.9%)

HDFC

Bajaj Finance

Mahindra Finance

Shriram Transport

L&T Finance

Shriram City Union

Trading Comparables¹

Source: Bloomberg as on October 09, 2020; ¹ FY ending March; 2 Represents FY20 P/B multiple adjusted for FPO issuanceNote: USD 1 = INR 75

1 Month Share Price Performance

Share Price (INR)

Weekly change in price (%)

Market Cap

USD mn

P/BV P/E ROE

FY21 FY22 FY21 FY22 FY21 FY22

Banks

HDFC Bank 1,234 11.4% 90,512 3.5x 3.1x 24.1x 19.8x 15.3% 16.6%

ICICI Bank 402 8.7% 36,916 2.1x 1.9x 18.9x 14.1x 12.3% 14.9%

Kotak Mahindra Bank 1,320 1.1% 34,830 3.3x 3.1x 34.0x 26.4x 10.4% 11.5%

Axis Bank 468 5.5% 19,097 1.4x 1.3x 18.7x 10.1x 8.7% 14.6%

Indusind Bank 623 5.2% 6,283 1.1x 1.0x 11.1x 8.1x 12.0% 14.4%

Yes Bank 13 (1.1%) 4,393 0.9x2 NA NA NA NA NA

Median 2.1x 1.9x 18.9x 14.1x 12.0% 14.6%

NBFCs

HDFC 1,958 9.3% 46,828 3.5x 3.2x 19.7x 16.5x 14.0% 15.1%

Bajaj Finance 3,318 (3.6%) 26,656 5.5x 4.6x 44.0x 26.4x 13.1% 18.5%

Mahindra Finance 133 2.9% 2,197 1.0x 0.9x 20.8x 11.7x 5.5% 9.7%

Shriram Transport 641 (2.7%) 2,163 0.7x 0.7x 8.8x 5.9x 10.4% 13.2%

L&T Finance 63 (2.5%) 1,680 0.8x 0.7x 10.9x 6.8x 7.7% 11.3%

Shriram City Union 919 (1.8%) 809 0.9x 0.9x 6.7x 6.5x 12.1% 13.1%

Median 1.0x 0.9x 15.3x 9.2x 11.2% 13.2%

Commentary

▪ On Oct 09, the Monetary Policy Committee (MPC) voted unanimously to leave the policy repo rate unchanged at 4% along with maintaining an accommodative stance to revive growth on a durable basis

− RBI Governor, Shaktikanta Das also announced that the real GDP is expected to fall by 9.5% during FY21, with risks tilted to the downside

▪ Indiabulls Housing Finance announced having sold a portion of its stake in OakNorth bank to Riva Capital Partners for INR 441 cr. (USD 59mn)

− The company has raised a total of INR 2,273 cr. (USD 303mn) during the months of September and October, having raised INR 683 cr. (USD 91mn) through QIP and INR 1,590 cr. (USD 212mn) through sale of multiple tranches in OakNorth bank

▪ HDFC Bank announced tie-up with Apollo Hospitals through which customers of Apollo Hospitals can avail an instant unsecured loan of up to INR 40 lac. (USD 53,333) to pay for medical expenses incurred at the healthcare chain

Sectoral Update – Financial Services

India – Insurance and Asset Management Update

7

Life Insurance General Life Insurance AMCs

2.4%

(3.4%)

ICICI Lomb.

New India

(0.1%)

(2.4%)

HDFC AMC

Nippon


Life Insurance

Share Price (INR)


Market capUSD mn

P/BV P/Emb. Value² RoA RoE

FY21 FY22 FY21 FY22 FY21 FY22 FY21 FY22

HDFC Life 574 0.8% 15,851 14.8x 12.8x 4.8x 4.1x 0.9% 1.0% 18.1% 16.5%

SBI Life 806 (1.6%) 11,029 8.1x 7.1x 2.6x 2.3x 0.8% 0.8% 13.0% 13.1%

ICICI Pru 430 1.5% 8,438 7.6x 6.9x 2.4x 2.2x 0.6% 0.6% 14.5% 13.1%

General Insurance

Share Price (INR)


Market capUSD mn

P/BV P/E RoA RoE


ICICI Lomb. 1,248 (4.1%) 7,757 7.8x 6.5x 39.2x 32.7x 3.6% 3.7% 21.3% 21.4%

New India 104 (1.2%) 2,341 0.7x 0.6x 13.0x 10.1x 1.5% 2.2% 6.4% 8.7%

AMCShare Price

(INR)


Market capUSD mn

EV³/AUM P/E RoA RoE


HDFC AMC 2,368 4.1% 6,895 13.2% 11.5% 39.8x 35.3x 30.2% 30.2% 29.8% 29.2%

Nippon 270 1.3% 2,258 5.3% 4.3% 32.1x 28.3x 19.0% 21.2% 19.3% 21.2%

¹ Financial year ending March, ²Emb. Value refers to Embedded Value; ³EV represents Enterprise Value; Note: USD 1 = INR 75Source: Bloomberg as on October 09, 2020; News run

Commentary

▪ SEBI tightened rules on inter-scheme transfers (ISTs) in mutual fund schemes by mandating that ISTs for managing liquidity should only be taken after all other avenues including using cash, market borrowing and selling securities in the market for raising liquidity have been attempted and exhausted

▪ Equity mutual funds saw outflow of c USD 98 mn in Sep-20 v USD 530 mn in Aug-20

▪ Board of ICICI Prudential Life Insurance approved raising capital by issuance of subordinated debt instruments in the nature of non-convertible debentures up to USD 160 mn


(2.0%)

(2.9%)

(1.1%)

HDFC Life

SBI Life

ICICI Pru

Sectoral Update – Technology, Telecom and Media

India Technology Update

8

¹ Financial year ending March; Note: USD 1 = INR 75Source: Bloomberg as on October 09, 2020; News run

Industry Update


▪ TCS announced buyback of upto 1.42% of its total paid-up equity share capital at INR 3,000 per share aggregating to a total buyback size of USD 2.1 bn

▪ Infosys announced acquisition of US-based Blue Acorn iCi Adobe Platinum partner in the United States and a provider of digital customer experience, commerce and analytics services for USD 125 mn

▪ Amazon infused USD 100 mn into its Indian digital payments business, Amazon Pay following an investment of USD 180 mn made in Jan-20

▪ Chennai based Chargebee, which operates a software-as-a-service-based subscription management platform, has raised USD 55 mn in a funding round led by Insight Partners and existing investors, Tiger Global and Steadview Capital


Share Price(INR)


Market capUSD mn

EVUSD mn

EV/Revenue EV/EBITDA P/E


Large Cap IT

TCS 2,813 11.5% 144,331 139,101 6.3x 5.7x 23.3x 20.3x 32.9x 28.1x

Infosys 1,107 8.8% 64,462 61,607 4.6x 4.2x 18.1x 16.3x 26.5x 23.6x

HCL 856 5.3% 31,754 30,758 3.0x 2.8x 12.1x 11.1x 19.6x 17.6x

Wipro 374 19.5% 29,232 25,428 3.1x 2.9x 14.6x 14.0x 22.2x 20.7x

Tech Mahindra 854 3.8% 11,287 10,655 2.1x 1.9x 13.4x 11.4x 20.9x 17.9x

Midcap IT and BPO

L&T Infotech 2,927 15.8% 6,986 6,639 4.0x 3.6x 20.3x 18.0x 30.0x 25.7x

Mphasis 1,382 1.9% 3,527 3,417 2.6x 2.4x 14.1x 12.5x 21.6x 18.7x

Mindtree 1,504 12.6% 3,387 3,217 3.0x 2.7x 17.0x 15.5x 28.5x 24.9x

L&T Tech Services 1,630 2.7% 2,330 2,273 3.1x 2.7x 17.7x 14.1x 26.6x 20.6x

Coforge 2,466 5.6% 2,043 1,968 3.1x 2.8x 18.2x 15.5x 31.8x 25.5x

Hexaware 467 0.3% 1,917 1,907 2.2x 2.0x 13.7x 12.3x 21.4x 19.2x

Firstsource Solutions 70 (2.7%) 668 809 1.3x 1.2x 8.4x 7.7x 12.5x 11.2x

Software

Oracle Financial Serv. 3,074 1.1% 3,614 3,016 4.4x 4.0x 9.2x 8.5x 16.1x 14.7x

Intellect Design 240 2.3% 434 455 2.4x 2.1x 12.8x 10.7x 21.0x 17.6x

Newgen Software 225 2.3% 215 197 2.2x 1.9x 11.0x 9.1x 17.5x 14.2x

Consumer Internet

InfoEdge 3,457 (4.2%) 6,078 5,981 34.3x 28.7x nm nm nm nm

IndiaMart 5,001 0.1% 1,979 1,867 20.1x 17.8x nm nm nm nm

MakeMyTrip 1,338 14.4% 1,889 1,737 7.0x 2.8x nm nm nm nm

JustDial 416 5.4% 369 372 3.6x 3.0x 14.9x 10.9x 12.1x 10.5x

20.8%

19.3%

18.5%

32.3%

13.4%

TCS

Infosys

HCL

Wipro

TechM

19.2%

21.0%

28.3%

9.3%

29.2%

10.8%

11.1%

L&T Infotech

Mphasis

Mindtree

L&T Services

Coforge

Hexaware

FirstSource

5.2%

29.4%

6.1%

5.4%

10.4%

10.8%

13.1%

Oracle

Intellect

Newgen

Infoedge

IndiaMart

MakeMyTrip

Just Dial

Large Cap IT Midcap IT and BPO Software and Consumer Internet

Sectoral Update – Technology, Telecom and Media

India Telecom and Media Update

9

¹ Financial year ending March; Note: USD 1 = INR 75Source: Bloomberg as on October 09, 2020; News run

Industry Update


▪ MeitY approved applications of 16 companies including, including Samsung, Foxconn Hon Hai, Pegatron, Lava, and Micromax, for rewards on mobile phone manufacturing in India under the Production Linked Incentive scheme

– These companies will be given incentives of 4-6% on incremental sales over base year (FY20) for 5 years. These companies are expected to produce mobile handsets/ components worth USD 140 bn over the next 5 years

▪ RIL announced that GIC would invest c.USD 750 mn for a 1.2% stake and TPG would invest USD 250 mn for 0.4% stake in its retail business arm, Reliance Retail Ventures at a pre money equity value of USD 57 bn

▪ RIL announced that Abu Dhabi Investment Authority (ADIA) would invest c.USD 750 mn for a 1.2% stake in its retail business arm, Reliance Retail Ventures at a pre money equity value of USD 57 bn

▪ Vanguard Group bought 0.61% stake in Zee Entertainment at INR 211.46 per share (aggregating to USD 16.5 mn)


Share Price(INR)


Market capUSD mn

EVUSD mn



Telecom

Reliance Industries 2,233 0.4% 193,604 235,463 3.3x 2.6x 19.5x 14.3x 34.1x 21.8x

Bharti Airtel 425 (1.7%) 31,719 51,666 3.7x 3.3x 8.4x 6.9x nm 30.1x

Bharti Infratel 187 4.2% 4,717 4,795 2.4x 2.3x 4.7x 4.4x 11.2x 10.5x

Vodafone Idea 9 (3.8%) 3,497 22,784 3.7x 3.3x 9.3x 7.3x nm nm

Media and Entertainment

Zee Entertainment 201 (6.3%) 2,634 2,591 2.6x 2.2x 11.2x 8.2x 17.1x 12.1x

Sun TV 460 (1.3%) 2,479 2,128 4.6x 4.0x 7.1x 6.3x 12.6x 11.6x

PVR 1,268 (2.5%) 957 1,579 11.5x 3.4x nm 12.1x nm nm

Network18 35 3.9% 499 1,310 na na na na na na

Inox 284 (1.0%) 400 779 7.0x 3.0x 46.8x 11.2x nm 38.4x

Dish TV 13 (4.1%) 339 556 1.2x 1.1x 2.0x 1.9x 28.4x 22.7x

3.3%

(15.7%)

(11.4%)

(19.8%)

Reliance Industries

Bharti Airtel

Bharti Infratel

Vodafone Idea

Telecom

(9.5%)

(0.9%)

(2.1%)

0.3%

0.1%

(2.7%)

Zee

Sun TV

PVR

Network18

INOX

Dish TV

Media and Entertainment

▪ The Indian pharmaceutical industry witnessed a 4.7% YoY sales growth in September 2020, according to AIOCD-AWACS.

Among therapies, cardiac registered a monthly growth of 17.1% in September compared to 11.5 % in August, while the

anti-diabetic category registered a monthly growth of 6.5% compared to 1.6% in August

▪ The 4 schemes launched by Department of Pharmaceuticals (DoP) for promoting domestic manufacturing of drugs,

APIs/ KSMs and medical devices received a robust initial response with 29 pharma companies submitting applications to

the government so far

Sectoral Update – Pharma

India Pharmaceuticals Update

10

¹ Financial year ending March; 2Financial year ending December.Source: Company news, Bloomberg as on October 09, 2020. FX rate: USD 1 = INR 75

Industry Update

Share Price(INR)


Market cap

USD mn

EVUSD mn



Large Cap Pharma

Sun Pharma 513 (1.9%) 16,408 16,571 3.4x 3.1x 14.7x 13.1x 23.4x 20.0x

Dr. Reddy’s 5,153 (0.1%) 11,422 11,374 4.2x 3.8x 17.2x 14.7x 29.3x 24.6x

Divi’s Labs 3,190 2.0% 11,291 11,151 11.7x 9.7x 30.8x 24.9x 43.4x 34.5x

Cipla 803 3.1% 8,635 8,822 3.4x 3.1x 15.5x 13.9x 27.5x 23.9x

Biocon 452 (1.4%) 7,230 7,347 6.2x 5.1x 20.9x 16.2x 40.5x 31.2x

Aurobindo Pharma 835 (1.0%) 6,520 6,914 2.0x 1.8x 9.1x 8.5x 14.3x 13.3x

Torrent Pharma 2,800 (0.8%) 6,317 7,007 5.9x 5.3x 20.3x 17.9x 36.7x 29.5x

Lupin 1,029 (0.9%) 6,218 6,470 2.8x 2.5x 15.6x 13.0x 32.1x 25.1x

Cadila Healthcare 438 5.8% 5,979 6,938 3.3x 3.1x 16.1x 15.1x 24.8x 23.2x

Alkem Labs 2,724 (1.1%) 4,342 4,421 3.4x 3.1x 17.0x 15.1x 22.1x 19.5x

Mid Cap Pharma

IPCA Labs 2,106 (2.1%) 3,548 3,552 4.6x 4.1x 19.2x 17.0x 25.3x 22.7x

Syngene Intl. 560 (2.6%) 2,985 2,902 8.8x 7.0x 28.2x 23.1x 52.7x 41.7x

Alembic Pharma 958 (1.5%) 2,512 2,742 3.7x 3.4x 15.0x 14.1x 21.3x 21.1x

Laurus Labs 327 10.5% 2,334 2,461 4.7x 4.2x 19.0x 15.8x 30.3x 24.5x

Natco Pharma 941 (1.1%) 2,283 2,315 7.4x 5.8x 20.5x 13.9x 27.8x 18.5x

Glenmark Pharma 492 (1.0%) 1,852 2,395 1.5x 1.4x 8.7x 8.0x 15.0x 13.3x

Ajanta Pharma 1,574 (1.7%) 1,831 1,800 4.7x 4.0x 15.7x 13.5x 24.0x 19.8x

Jubilant LS 716 (5.1%) 1,520 1,976 1.5x 1.4x 7.1x 6.4x 11.2x 9.8x

Eris LS 518 (4.2%) 938 921 5.5x 5.0x 16.3x 14.8x 20.1x 17.7x

MNC Pharma

Abbott India 16,036 0.3% 4,543 4,274 6.7x 5.8x 32.1x 27.1x 46.3x 38.3x

GSK Pharma 1,558 (0.6%) 3,519 3,380 7.2x 6.5x 32.8x 28.4x 45.0x 38.5x

Pfizer Ltd 5,022 2.0% 3,063 2,784 8.7x 8.2x 29.7x 28.4x 40.2x 38.1x

Sanofi India² 8,629 (0.4%) 2,650 2,500 6.0x 5.6x 24.9x 22.5x 35.6x 32.1x

Novartis India 669 (1.5%) 220 152 NA NA NA NA NA NA

Trading Comparables1


0.7%16.3%

1.0%10.4%

5.6%4.1%

(0.3%)9.4%

18.2%(4.8%)

Sun PharmaDr. Reddy’sDivi’s Labs

CiplaBiocon

Aurobindo PharmaTorrent Pharma

LupinCadila Healthcare

Alkem Labs

Large Cap Pharma Mid Cap Pharma MNC Pharma

3.1%

23.2%

4.3%

34.9%

23.3%

4.8%

5.0%

0.6%

7.4%

IPCA Labs

Syngene Intl.

Alembic Pharma

Laurus Labs

Natco Pharma

Glenmark Pharma

Ajanta Pharma

Jubilant LS

Eris LS

(3.6%)

(5.0%)

0.5%

4.2%

2.9%

Abbott India

GSK Pharma

Pfizer Ltd

Sanofi India

Novartis India

Sectoral Update – Healthcare

India Healthcare Update

11

Industry Update


¹ Financial year ending March 2 Net Debt is negative, EBITDA is positive 3 Represents FY20 multiples for Poly MedicureSource: Company news, Bloomberg as on October 09, 2020. FX rate: USD 1 = INR 75


41.7%

(1.1%)

12.8%

13.4%

46.5%

20.4%

Apollo Hospitals

Fortis Healthcare

Narayana Hrudayalaya

Aster DM Healthcare

Healthcare Global

Shalby

Hospitals

15.8%

11.7%

42.3%

0.5%

Dr Lal Pathlabs

Metropolis

Thyrocare

Poly Medicure

Diagnostic and Medical Devices

Share Price (INR)


Market Cap USD mn

EVUSD mn



Hospitals

Apollo Hospitals 2,277 7.1% 4,224 4,919 3.5x 2.8x 39.7x 19.4x NM 55.8x

Fortis Healthcare 134 (1.1%) 1,345 1,595 3.0x 2.3x 36.2x 14.6x NM 39.8x

Narayana Hrudayalaya

348 (2.3%) 947 1,050 3.0x 2.2x 39.2x 15.2x NM 37.1x

Aster DM Healthcare

138 4.4% 918 1,705 1.4x 1.2x 11.3x 8.5x 46.2x 15.6x

Healthcare Global 121 (0.1%) 202 295 2.1x 1.7x 14.8x 10.1x NM NM

Shalby2 96 11.9% 138 140 2.7x 1.9x 20.5x 10.6x 40.0x 24.7x

Diagnostics

Dr Lal Pathlabs2 2,055 6.6% 2,283 2,255 12.2x 10.1x 49.7x 36.9x 79.1x 54.6x

Metropolis2 1,967 2.8% 1,336 1,315 11.0x 8.8x 41.5x 30.4x 69.7x 46.5x

Thyrocare2 1,069 37.9% 753 744 12.4x 10.4x 35.1x 25.6x 57.2x 41.0x

Medical Devices

Poly Medicure 476 2.2% 560 577 6.3x² NA 26.3x² NA 43.7x² NA

▪ The Government is in the process of building a digital platform which will track Covid-19 vaccine administration and

movement, from procurement to storage, to distribution to individual beneficiaries

▪ According to the Association of Indian Medical Device Industry (AiMED), the medical devices industry witnessed a

notable increase in production of devices such as diagnostic & testing kits, gloves, masks, ventilators, etc. Number of

PPE kit manufacturers went from 20 (pre-Covid) to 140 with c.25 cr. of annual capacity. Similarly, number of Indian firms

involved in manufacturing of ventilators, masks, swabs, RT PCR Kits also increased substantially

Sectoral Update – Auto & Auto Components

India Auto & Auto Components Update

12



(2.1%)

5.1%

3.1%

14.6%

(1.2%)

Maruti Suzuki

Bajaj Auto

M&M

Hero MotoCorp

Tata Motors

Auto Makers

10.3%

(0.3%)

0.0%

Motherson Sumi Systems

Bosch

MRF

Auto Components and Tyres

Share Price(INR)


Market capUSD mn

EVUSD mn



Auto Makers

Maruti Suzuki 7,062 3.9% 29,192 29,053 3.6x 2.7x 38.1x 24.3x 50.9x 30.8x

Bajaj Auto 3,060 2.5% 12,115 11,692 3.8x 2.9x 24.5x 16.8x 23.7x 17.3x

M&M 633 3.8% 10,771 18,130 1.6x 1.5x 9.8x 8.5x 21.2x 16.9x

Hero MotoCorp 3,327 5.6% 9,095 8,480 1.9x NA NA NA 19.1x NA

Tata Motors 138 3.7% 6,280 17,744 0.5x 0.5x 6.1x 3.8x NM 26.3x

Auto Components

Motherson Sumi 121 4.3% 5,232 6,851 0.9x 0.8x 11.3x 8.1x 42.7x 21.6x

Bosch 12,738 (6.0%) 5,141 4,803 3.1x 2.7x 20.6x 17.3x 28.2x 24.2x

Tyres

MRF 58,785 (3.0%) 3,411 3,349 1.7x 1.5x 10.3x 8.7x 25.3x 19.4x

¹ Financial year ending March; Note: USD 1 = INR 75Source: Bloomberg as on October 09, 2020, Company information, News run

Industry Update

▪ According to Federation of Automobile Dealers Associations (FADA), vehicle registrations in September grew 11.5% on a

month-on-month basis but fell 10.2% on a year-on-year (YoY) basis

– 2-wheeler sales fell 13% YoY, while 3-wheelers and commercial vehicles declined 59% and 34% YoY respectively

– Passenger vehicle (PV) and Tractor segment saw a YoY increase of 10% and 80% respectively

▪ India’s PV makers are exploring contract manufacturing among options to better utilize the idle capacities at their factories

following more than two straight years of falling sales and predictions that a full recovery may take 2-3 years

Sectoral Update – Metals & Mining

India Metals & Mining Update

13


Industry Update

▪ Hindustan Zinc launched an online buying platform, EVOLVE, for non-ferrous metals. EVOLVE has been designed to offer

a three-click buying experience for zinc, lead, silver and acid on a single platform based on real-time pricing on LME/

LBMA (London Metal Exchange/ London Bullion Market Association)

▪ Consumption of non-ferrous metals like copper and aluminum is expected to contract significantly in 2020. The Covid-19

pandemic has severely impacted the global automobile, construction and electrical machinery industries, which together

contributes 75-85% to the global non-ferrous metal demand


(3.5%)

(9.5%)

(4.8%)

(11.1%)

Hindustan Zinc

Coal India

Vedanta

NMDC

Integrated Mining & Metals

1.8%

(11.5%)

0.0%

(7.0%)

JSW Steel

Tata Steel

Jindal Steel & Power

Hindalco Industries

Steel & Other Metals

Share Price(INR)


Market capUSD mn

EVUSD mn



Integrated Mining & Metals

Hindustan Zinc 209 0.2% 12,061 9,106 4.0x 3.2x 8.6x 6.5x 16.5x 12.6x

Coal India 115 (2.0%) 9,689 6,716 0.6x 0.5x 3.1x 2.7x 5.6x 4.8x

Vedanta 122 (11.3%) 6,198 10,372 1.1x 0.9x 4.8x 3.6x 34.7x 10.0x

NMDC 82 (1.3%) 3,417 3,161 2.6x 2.0x 5.7x 4.5x 8.2x 6.7x

Steel

JSW Steel 292 3.5% 9,658 16,353 1.9x 1.4x 11.6x 7.5x 53.7x 14.8x

Tata Steel 370 1.2% 5,756 20,456 1.2x 1.0x 10.6x 6.8x NM 8.5x

Jindal Steel & Power 194 1.9% 2,706 6,819 1.4x 1.2x 7.2x 5.7x NM 18.4x

Other Metals

Hindalco Industries 170 (2.4%) 5,225 10,755 0.7x 0.6x 7.1x 5.4x 16.5x 8.8x


9.5%

(1.0%)

Interglobe Aviation

SpiceJet

Sectoral Update – Aviation

India Aviation Update

14


Indigo and Spice Jet Share Price Performance

▪ Recovery in domestic air passenger traffic continued in September with a sequential growth about 37-39% in

passenger volume in the previous month of August. The passenger volumes have still declined 60% in September

2020 over the same month year-ago

▪ The government is looking to revise the bidding document for Air India by the month end, allowing either potential

bidders to value the loss-making national carrier purely based on its assets or substantially reduce the INR 23,286 cr.

(USD 3.1bn) debt currently required to be absorbed by the successful bidder


0

20

40

60

80

100

120

140

Oct-19 Dec-19 Mar-20 May-20 Jul-20 Oct-20

Last 1 year Last 1 month

80

90

100

110

120

9-Sep-20 16-Sep-20 24-Sep-20 1-Oct-20 9-Oct-20

Price (SpiceJet)Price (Indigo)

1 1

Indian LCCs Global FSCs Global LCCs

2.9%

(10.2%)

(48.0%)

Delta Airlines

Air China

IAG

(0.6%)

6.4%

(11.9%)

(3.2%)

Southwest Airlines

Ryanair

EasyJet

Air Asia Group

Share Price (INR)


Market CapUSD mn

EVUSD mn



Interglobe Aviation 1,367 7.7% 7,199 7,474 2.1x 1.4x 19.1x 6.9x NM 20.9x

SpiceJet 50 (0.6%) 410 1,750 1.1x 1.0x 30.7x 6.7x NM 11.1x

¹ Rebased to 100, 2 Financial year ending March; Note: USD 1 = INR 75Source: Bloomberg as on October 09, 2020, Company information, News run

Industry Update

Sectoral Update – Power and Infrastructure

India Power Update

15



¹ Financial year ending March; Note: USD 1 = INR 75Source: Bloomberg as on October 09, 2020 (October 08, 2020 for Azure Power – Trading Comps)

10.8%

(2.2%)

(6.8%)

(0.5%)

(9.8%)

Adani Trans.

Tata

Torrent

CESC

Power Grid

Integrated &Transmission

15.9%

(8.3%)

(1.0%)

(1.3%)

17.0%

(3.1%)

Adani Green

NTPC

NHPC

Adani Power

Azure

JSW

Generation

Share Price (INR)


Market Cap.

USD mn

EVUSD mn



Integrated

Adani Trans. 290 17.3% 4,253 7,716 5.1x 4.6x 12.2x 10.7x 32.8x 26.7x

Tata Power 54 0.0% 2,320 9,186 2.2x 2.1x 8.8x 8.6x 12.2x 10.8x

Torrent Pwr. 303 (2.0%) 1,944 3,021 1.6x 1.5x 6.2x 5.9x 11.8x 10.5x

CESC 610 (1.4%) 1,078 2,473 1.6x 1.5x 6.0x 5.6x 6.8x 5.8x

Generation

Adani Green 684 (8.5%) 14,263 16,015 NA NA NA NA NA NA

NTPC 83 (2.4%) 10,937 37,799 2.6x 2.3x 8.8x 7.6x 6.3x 5.4x

NHPC 21 1.2% 2,746 5,769 4.4x 4.1x 7.8x 7.3x 7.0x 6.6x

Adani Power 37 (1.2%) 1,882 8,615 3.0x 2.8x 9.3x 8.2x 18.6x 10.5x

Azure Power 2,341 (0.6%) 1,494 2,626 12.7x 8.4x 16.6x 10.6x NM NM

JSW Energy 57 1.1% 1,239 2,220 2.0x 1.8x 5.8x 5.3x 11.4x 9.5x

Transmission

Power Grid 158 (4.0%) 11,021 30,070 5.6x 5.3x 6.6x 6.1x 7.2x 6.5x

Key Parameters of USD Bonds Issued by Indian Renewable IPPs

IssuerIssue Date

MaturityAmt. Issued

(USD mn)Coupon

Curr. YTM

1wago

1mago

3mago

6mago

1yago

Greenko 16-Aug-16 16-Aug-23 500.0 4.88% 4.72% 4.88% 4.90% 5.46% 10.03% 5.19%

Greenko 24-Jul-17 24-Jul-24 650.0 5.25% 4.47% 4.67% 4.75% 5.19% 9.04% 5.15%

Greenko 24-Jul-17 24-Jul-22 350.0 4.88% 4.97% 4.98% 4.56% 5.21% 8.76% 4.66%

Azure Power 03-Aug-17 03-Nov-22 500.0 5.50% 4.01% 4.54% 3.98% 5.02% 8.35% 5.06%

Renew Power 12-Mar-19 12-Mar-24 525.0 6.67% 5.28% 5.55% 5.32% 6.27% 14.09% 6.33%

Adani Green 10-Jun-19 10-Dec-24 500.0 5.65% 4.27% 4.41% 4.41% 5.35% 9.09% 5.63%

Greenko 29-Jul-19 29-Jul-26 535.0 5.95% 5.00% 5.13% 5.20% 6.20% 9.39% 5.86%

Greenko 29-Jul-19 29-Jan-25 500.0 5.55% 4.99% 5.42% 4.98% 5.85% 9.73% 5.59%

Greenko 21-Aug-19 21-Feb-23 435.0 6.25% 4.91% 5.04% 4.96% 5.86% 10.99% 5.71%

Renew Power 12-Sep-19 27-Sep-22 300.0 6.45% 5.47% 5.52% 4.90% 6.51% 13.34% 6.03%

Azure Power 24-Sep-19 24-Dec-24 350.1 5.65% 4.27% 4.41% 4.41% 5.35% 9.09% 5.63%

Renew Power 29-Jan-20 05-Mar-27 450.0 5.88% 5.69% 5.82% 5.77% 6.48% 12.53% NA

Sectoral Update – Power and Infrastructure

India Infrastructure Update

16


Performance of Listed InvITs

FY20 Dividends (INR) FY21 Dividends (INR)

Trust Unit Price (INR) Q1 Q2 Q3 Q4 Q1

India Grid 106.3 3.0 3.0 3.0 3.0 3.0

IRB InvIT 34.4 3.0 2.5 2.7 1.8 1.5


¹ Financial year ending March; Note: USD 1 = INR 75; Source: Bloomberg as on October 09, 2020, Company Information, News run

3.9%

1.3%

(8.4%)

(7.9%)

APSEZ

GMR

IRB

Ashoka Buildcon

Ports, Airports and Roads

(2.6%)

4.1%

(4.8%)

(7.9%)

IGL

Gujarat Gas

Adani Gas

MGL

City Gas Dist.

Share Price (INR)


Market Cap.

USD mn

EVUSD mn



Ports, Airports and Roads

APSEZ 357 1.1% 9,677 12,448 7.7x 6.3x 12.3x 10.0x 17.7x 14.1x

GMR Infra 24 (0.8%) 1,891 5,852 9.0x 6.2x 41.0x 19.1x NM NM

IRB Infra 112 0.1% 526 1,445 1.9x 1.7x 4.5x 3.9x 18.1x 13.0x

Ashoka Build.

63 (3.4%) 237 1,190 2.0x 1.6x 6.7x 5.5x NM 31.5x

City Gas Dist.

IGL 382 (4.9%) 3,561 3,283 4.0x 3.2x 17.2x 13.2x 24.2x 18.6x

Gujarat Gas 303 (2.4%) 2,783 2,970 2.6x 2.0x 14.8x 11.6x 26.0x 18.4x

Adani Gas 189 (2.5%) 2,766 2,804 13.4x 9.3x 35.6x 25.6x 54.7x 44.8x

MGL 824 (4.6%) 1,085 914 3.4x 2.2x 9.3x 6.0x 16.3x 10.2x

Recent Developments – Power and Infra

▪ Power consumption in the first week of October (Oct 01 – Oct 07) stood at 25.95 BU, up by 13.7% on a YoY basis

▪ Torrent Gas, the city gas distribution arm of Torrent Group announced to invest INR 8,000 cr. (USD 1.1 bn) over the next 5 years towards the creation of CGD infrastructure

− The company targets to set up 500 CNG dispensing pumps by March 2023

▪ Adani Ports and SEZ (APSEZ) announced completion of acquisition of Krishnapatnam Port for an enterprise value of INR 12,000 cr. (USD 1.6 bn), resulting in APSEZ holding 75% stake in Krishnapatnam Port

▪ NTPC announced that it has incorporated a 100% subsidiary – NTPC Renewable Energy to undertake its renewable energy business

− NTPC is targeting generation of nearly 30% or 39 GW of its overall power capacity from renewable energy sources by 2032

Diversified, Wellnessand Personal Care

▪ Hindustan Unilever has tied-up with State Bank of India to provide digital payment solutions for small retailers

– SBI will offer an instant paperless overdraft facility of up to INR 50,000 to retailers for their billings with

distributors. SBI will also offer financing options to HUL distributors

▪ ITC is looking to strengthen its fresh dairy offerings (under the ”Aashirvaad Svasti” brand) across the eastern region

– The company is exploring new markets in Bengal and procurement of milk from farmers in the state is being

ramped-up as part of its expansion plans

Sectoral Update – Consumer and Retail

India Consumer Update

17



¹ Financial year ending March – Nestle India calendarized to March year end; Note: USD 1 = INR 75Source: Bloomberg as on October 09, 2020, Company information, News run

Industry Update

Share Price (INR)


Market Cap

USD mnEV

USD mn



Diversified, Wellness and Personal Care

HUL 2,140 2.1% 67,030 66,183 9.8x 8.8x 36.0x 31.0x 50.6x 42.9x

Dabur 519 1.0% 12,233 12,015 8.9x 8.0x 40.5x 35.4x 48.7x 42.7x

Godrej Consumer 720 (1.9%) 9,814 10,105 6.7x 6.1x 29.3x 26.0x 40.4x 35.8x

Marico 369 2.1% 6,359 6,309 5.7x 5.2x 27.0x 24.5x 38.0x 34.4x

Colgate India 1,463 1.6% 5,305 5,265 8.5x 7.8x 30.2x 27.4x 46.4x 41.6x

Emami 343 (2.0%) 2,035 2,040 5.2x 4.8x 18.8x 17.3x 26.2x 23.9x

Zydus Wellness 1,802 (2.1%) 1,529 1,706 6.1x 5.5x 32.3x 28.1x 43.9x 35.0x

Food

Nestle India 16,034 0.2% 20,613 20,249 11.4x 10.1x 47.2x 41.2x 70.6x 60.2x

Britannia 3,745 (1.7%) 12,021 12,083 6.2x 5.6x 34.8x 30.7x 45.1x 39.2x

Tata Consumer 471 (7.4%) 5,787 5,808 3.7x 3.5x 24.7x 22.6x 41.3x 35.9x

Tobacco and Alcohol

ITC 168 (1.8%) 27,540 24,287 3.4x 3.1x 8.8x 8.1x 12.7x 11.5x

United Spirits 521 (0.3%) 5,051 5,383 4.2x 3.6x 24.6x 20.3x 38.3x 30.6x

United Breweries 991 3.0% 3,492 3,505 3.7x 3.2x 23.3x 18.3x 43.7x 32.1x

VST Industries 3,332 (1.4%) 686 584 3.1x NA 9.1x NA 14.1x NA

Godfrey Philips 900 (2.2%) 624 654 1.5x NA 6.3x NA 8.8x NA

(1.7%)

0.2%

(11.9%)

Nestle India

Britannia

Tata Consumer

(8.7%)

(5.3%)

(8.2%)

0.0%

(1.2%)

ITC

United Spirits

United Breweries

VST Industries

Godfrey Philips

Food Tobacco and Alcohol

0.3%

5.4%

7.0%

1.5%

7.1%

(5.4%)

8.3%

HUL

Dabur

Godrej Consumer

Marico

Colgate India

Emami

Zydus Wellness

Sectoral Update – Consumer and Retail

India Retail Update

18




Industry Update

▪ Reliance announced that ADIA will invest INR 5,512.5 cr. (USD 735mn) in Reliance Retail Ventures (RRVL) at a pre-money equity value of INR 4.285 lac cr. (USD 57bn)

– ADIA’s investment will translate into a 1.2% equity stake in RRVL on a fully-diluted basis

– With this investment, RRVL has raised INR 37,710 cr. (USD 5bn) from leading global investors (Silver Lake, KKR, General Atlantic, Mubadala, GIC, TPG and ADIA) in less than 4 weeks

▪ Walmart-owned Flipkart has partnered with Paytm to provide its customers with a wide range of offers / benefits during its Big Billion Days Sale 2020 (Oct 16 –21). Unlike Flipkart (which is sticking to a 6-day Big Billion Days Sale), Amazon is extending its Diwali sales event (The Great Indian Festival) to an entire month, starting Oct 17

Share Price (INR)


Market Cap

USD mnEV

USD mn



Restaurant

Jubilant Foodworks 2,302 (2.7%) 4,050 4,180 9.2x 6.9x 41.2x 27.8x 124.9x 61.1x

Westlife Development 393 (0.6%) 815 923 6.3x 4.1x 143.3x 37.3x NM 109.4x

Grocery Retailers

Avenue Supermarts 2,058 (5.8%) 17,771 17,800 5.3x 3.8x 78.0x 44.4x 117.9x 68.2x

Future Retail 78 (13.2%) 566 1,943 0.6x NA 7.6x NA 4.7x NA

Spencer’s Retail 79 2.1% 95 95 NA NA NA NA NA NA

Lifestyle Retailer

Trent 680 0.9% 3,221 3,469 10.4x 6.4x 133.9x 41.0x NM 129.6x

Aditya Birla Fashion & Retail

129 (2.9%) 1,416 2,087 NA NA NA NA NA NA

Vmart Retail 1,997 1.4% 484 551 3.5x 2.2x 36.4x 18.1x NM 51.3x

Future Lifestyle Fashions 82 (7.9%) 221 333 0.3x NA 2.3x NA 9.4x NA

Shoppers Stop 176 (2.6%) 207 485 1.2x 1.0x 8.3x 8.7x NM 29.4x

3.4%

7.1%

(7.4%)

(18.9%)

(1.9%)

Jubilant Foodworks

Westlife Development

Avenue Supermarts

Future Retail

Spencer’s Retail

Restaurant & Grocery Retailers

4.3%

(1.0%)

1.9%

(24.5%)

4.6%

Trent

Aditya Birla Fashion & Retail

Vmart Retail

Future Lifestyle Fashions

Shoppers Stop

Lifestyle Retailer

Sectoral Update – Real Estate

India Real Estate Update

19


Industry Update


▪ The RBI altered rules for new home loans to provide a boost to the real estate sector. Under the current regulations,

differential risk weights are applicable to individual home loans, based on the size of the loan as well as the loan-to-

value ratio (LTV). This is applicable for all new housing loans sanctioned up to March 2022 and is expected to make

more credit available to borrowers, particularly for the higher value loans

▪ According to Knight Frank’s report, gross office leasing across top 8 cities witnessed a strong recovery, registering 80%

growth in the June-Sep quarter of 2020. New office completions also reported recovery of 126%


Share Price (INR)


Market Cap

USD mnEV

USD mn



DLF 157 0.7% 5,182 5,681 6.1x 5.8x 16.4x 14.6x 18.6x 16.8x

Embassy Office Parks REIT

360 (0.7%) 3,703 4,474 14.3x 12.4x 17.4x 15.3x 28.7x 25.6x

Godrej Properties 913 5.3% 3,068 3,221 13.9x 13.7x 81.1x 79.3x 42.4x 52.6x

Oberoi Realty 380 (7.0%) 1,840 2,009 4.9x 4.2x 10.9x 8.9x 13.0x 11.8x

Phoenix Mills 564 (5.9%) 1,292 2,000 7.0x 6.3x 13.4x 11.4x 24.8x 19.4x

Prestige Estates Projects 258 1.7% 1,380 2,658 2.8x 2.8x 8.8x 9.0x 18.7x 18.0x

Sunteck Realty 255 (3.4%) 498 599 3.3x 3.1x 7.6x 7.4x 9.6x 9.4x

Nesco 526 (1.3%) 494 487 7.5x 6.2x 11.0x 9.0x 16.5x 13.0x

Brigade Enterprises 170 1.3% 463 974 2.4x 2.1x 8.3x 6.7x 18.0x 12.2x

Chalet Hotels 136 (6.2%) 372 609 3.8x 3.2x 10.0x 7.9x 17.6x 12.6x

4.6%

(0.6%)

5.1%

0.9%

(9.4%)

DLF

Embassy Office Parks REIT

Godrej Properties

Oberoi Realty

Phoenix Mills

15.3%

(0.8%)

1.3%

6.5%

(6.2%)

Prestige Estates

Sunteck Realty

Nesco

Brigade Enterprises

Chalet Hotels

NovaDhruva Capital Private Limited902 One Indiabulls Centre, Tower 2A; Elphinstone Road (West), Mumbai 400 013; : +91 22 6246 6000www.novadhruva.com

NovaDhruva Team

Sunil SanghaiFounder & [email protected]

Rikin SanghviExecutive [email protected]

Dhruv BhatiaVice [email protected]

Mohit BhutdaSenior [email protected]

Piyush RamchandaniSenior [email protected]

Neel JainSenior [email protected]

Stuti [email protected]

Ponmathi VeerachamiSenior [email protected]

Yogesh GidwaniSenior [email protected]

Mandvi DixitExecutive [email protected]

Vishal [email protected]

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end of the week update - novadhruva.com · 10/9/2020 · end of the week update october 09, 2020....

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