Tag: JainMatrix Investments

Bajaj Housing Finance IPO – Take This Loan

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  • Date 08th Sept 2024
  • IPO Opens Sep 9th-11th, at ₹ 66-70 /share
  • IPO of ₹ 6,560 cr., Large Cap with ₹ 58,300 cr. Mkt cap
  • Sector – Housing Finance
  • Valuations: P/E – 33.7 , P/B 3.83 times post IPO
  • Opinion: It is a BUY. Investors can SUBSCRIBE for the Long term

Summary:

  • Bajaj Finance Ltd. has transferred its mortgage loans business to BHFL. Growth in Home loans AUM has been excellent over 3 years at 42% CAGR. As the #2 largest HFC NBFC, BHFL looks set to grow and expand this market with competitive and innovative offerings. The BHFL vision is to build a reputation in mortgages on par with HDFC group. Its systems look excellent as its loans have the lowest GNPA & NNPA in this sector. It’s adopted the digital path with mobile applications, website and loan processing apps, which should drive new business. The IPO valuations look reasonable adjusted for growth, quality and top notch Bajaj Group backing, as the P/B of BHFL is 3.8 times versus Bajaj Finance-5.6. The leadership & brand of Bajaj Finance should rub off on BHFL.
  • Risks: 1) Regulatory risk and control of RBI 2) Economic & cyclical risk – we can expect a Real Estate slowdown in 4-6 years 3) mortgage loan competition from banks, NBFCs & fintechs 4) Deterioration of asset quality 5) interest rate sensitive sector 6) Some overlap in business with BajFin.
  • Opinion: The BHFL IPO is a BUY, and Investors can SUBSCRIBE for Long term.
  • Disclosure: JMI and Punit Jain have analyzed and tracked Bajaj Finance since Feb 2012, see reports Bajaj Finance, Automatic Growth and Bajaj Finance – a Firm you can Bank on and NBFC Sector

Here is a note on Bajaj Housing Finance Ltd – BHFL.

IPO highlights

  • The IPO opens from 9-11th Sep’24 in a Price Band of ₹ 66-70 per share.
  • The IPO is a Fresh Issue of ₹ 3,560 cr. and ₹ 3,000 cr. of Offer for Sale totalling ₹ 6,560 cr.
  • The main reasons and objects of the IPO are:  
    • RBI identified BHFL as an “upper layer” NBFC, and mandated it to list by Sep’25. It is early in this.
    • BajFin will use the IPO to boost BHFL’s capital base, enabling it to fund expansion of lending operations and capitalize on future growth opportunities in the housing finance sector.
    • BajFin too in the OFS will raise funds that will help in future growth.
  • The lot size is 214 shares and Face Value is ₹ 10 per share.
  • The IPO share quotas are QIBs: Non-Institutional Investors: Retail is 50:35:15%. In addition, BHFL has reserved shares worth ₹ 200 cr. for eligible employees, and shares worth ₹ 500 cr. for shareholders of BajFin and Bajaj Finserv. (The Record Date was 30 Aug’24.)
  • The unofficial/grey market premium of BHFL is ₹ 50/share over the IPO price. This is a positive.
  • The IPO allotment is likely to be finalized on 12th Sep., refunds will be on 13th Sep., and also crediting of shares to eligible allottees. BHFL shares will be listed on BSE and NSE, on 16th Sep.

Download Full Report

JainMatrix Investments_Bajaj Housing Finance IPO_08thSept2024Download

Disclaimers and Disclosures

  • JMI and Punit Jain have analyzed and tracked Bajaj Finance since Feb 2012, see reports Bajaj Finance, Automatic Growth and Bajaj Finance – a Firm you can Bank on and NBFC Sector
  • Punit Jain discloses that he has shareholding in Bajaj Finance since April 2003 (<1% stake). Other than this, he has no financial interest or transactions with Bajaj Finance, or any group company. In addition, JMI and its promoters/ employees have no direct or financial interest in these companies, and no known material conflict of interest as on date of publication of this report. Punit Jain intends to apply in this IPO in line with this research note opinion.
  • This document has been prepared by JainMatrix Investments Bangalore (JMI), and is meant for use by the recipient only as information and is not for circulation. This document is not to be reported or copied or made available to others without prior permission of JM. This report should not be considered or taken as an offer to sell or a solicitation to buy or sell any security. The information contained in this report has been obtained from sources that are considered to be reliable. However, JMI has not independently verified the accuracy or completeness of the same. Neither JMI nor any of its affiliates, its directors or its employees accepts any responsibility of whatsoever nature for the information, statements and opinion given, made available or expressed herein or for any omission therein. Investment in the securities market are subject to market risks. Read all the related documents carefully before investing. The suitability or otherwise of any investments will depend upon the recipient’s particular circumstances and, in case of doubt, advice should be sought from a RIA Registered Investment Advisor. JMI has been an equity investment adviser commercially since Nov 2012, and a SEBI certified and registered since 2016, under SEBI (Research Analysts) Regulations. Registration granted by SEBI, and certification from NISM in no way guarantee the performance of the Research Analyst or provide any assurance of returns to investors.
  • Any questions should be directed to punit.jain@jainmatrix.com. Name of the RA as registered with SEBI – Punit Jain, SEBI Registration No. INH200002747. Logo/brand name –

JainMatrix Satellite Stocks Report Aug 2024

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26th Aug 2024

Subscribers and Investors,

JainMatrix Investments, a Research Analyst firm, is pleased to present its latest update of our Satellite Stocks Basket. Key points are

  • Introduction: It’s over 3 years since we introduced the Satellite stocks basket
  • This update report is dated 25th Aug, and the report covers 10 stocks
  • These firms are a mix of small, mid and large-cap firms
  • The objective of this basket is to look at shorter-term, high-potential ideas that must outperform the Mid and Small-cap indices by 2-3% per year
  • The Satellite stocks have performed excellently over the years
  • Recommendation Changes:
    • In our last report, we had 7 BUYs and 2 HOLDs
    • In this, we introduce a new BUY, and downgrade a HOLD and a BUY, to SELL
    • So we now have 7 BUYs and 1 HOLD as the final stocks recommendations
    • These 7 BUYs represent 4 high potential sectors, and are high performers within these sectors
  • Investing Trends: The trends we notice and capture in our report are:
    • Investor Optimism even at all time highs on Indices
    • More domestic focus rather than exports
    • Key themes are Consumption, Automobiles and Infrastructure
    • Several sectors are witnessing a cyclical upswing that should be sustained for several years.
  • Based on our research, this Satellite stocks report includes 1-2 page notes on all these stocks and 2-year Target Prices for May 2026.
  • Current subscribers may note the changes recommended.
  • Investors new to our service may sign up using PRICING AND PAYMENT OPTIONS link, to grow their Direct Equity portfolios.

Disclaimers

This document has been prepared by JainMatrix Investments Bangalore (JM), and is meant for use by the recipient only as information and is not for circulation. This document is not to be reported or copied or made available to others without prior permission of JM. This report should not be considered or taken as an offer to sell or a solicitation to buy or sell any security. The information contained in this report has been obtained from sources that are considered to be reliable. However, JM has not independently verified the accuracy or completeness of the same. Neither JM nor any of its affiliates, its directors or its employees accepts any responsibility of whatsoever nature for the information, statements and opinion given, made available or expressed herein or for any omission therein. Investment in the securities market are subject to market risks. Read all the related documents carefully before investing. The suitability or otherwise of any investments will depend upon the recipient’s particular circumstances and, in case of doubt, advice should be sought from a RIA Registered Investment Advisor. JMI has been an equity investment adviser commercially since Nov 2012, and a SEBI certified and registered since 2016, under SEBI (Research Analysts) Regulations. Registration granted by SEBI, and certification from NISM in no way guarantee the performance of the Research Analyst or provide any assurance of returns to investors. Any questions should be directed to punit.jain@jainmatrix.com. Name of the RA as registered with SEBI – Punit Jain, SEBI Registration No. INH200002747. Logo/brand names are –

Ola Electric IPO – Profitability in 2 years

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  • Dated 04th Aug.
  • IPO is open from 2-6th Aug, at ₹ 72-76 /share
  • The IPO offering is large, at ₹ 6,150 cr.
  • Mid-Cap firm with Mkt cap ₹ 33,500 cr.
  • Sector: Automobile, EV, 2W
  • Opinion: High-risk takers can buy with a 2-year perspective

Summary

  • Ola Electric is a startup by serial entrepreneur Bhavish Agarwal for Electric two Wheelers. With a good brand drawn from Ola Cabs, Ola Electric has created the products, factories and sales network, and grabbed a 35% market share in India in E2W. Revenue grew 88% in FY24, indicating that Ola may have hit the ‘growth inflexion point’ in the hockey stick formation. The organization and structure set-up looks good to handle the possible growth. The overall 2W industry size and growth offer a massive opportunity for disruption. The products are beneficial to reduce pollution from fossil fuels and are aligned with electrification & renewables initiatives. Govt. of India policies are helpful with Ola using FAME and PLI incentives. E4W adoption in China is a good early indicator of possible E2W adoption in India. Our analysis indicates Ola can hit profitability by FY26, in two years.
  • Risks: 1) Typical startup risks of small possibility of success of massive disruption and ambitious goals; Typical IPO risks of undiscovered firm 2) currently cash-burning business 3) Dependence on China for RM – is being overcome through R&D and new mfg. facilities 4) Competition – Entry of new startup players and E2W plans by current ICE players 5) support drying up from GoI policies as industry accelerates 6) Volatility in RM prices
  • Opinion: High-risk takers can buy with a 2-year perspective

Here is a note on Ola Electric Mobility Ltd (OLA).

IPO highlights

  • IPO application dates: 2nd – 6th Aug’24, with Price Band: range of ₹72 – 76 per share, of FV: ₹10.
  • IPO Size is of ₹ 6,150 cr. – Offer for Sale 8.49 cr. shares (₹ 645 cr.) and Fresh Issue 72.3 cr. (₹ 5,500 cr.)
  • Lot Size: Investors can bid for a minimum of 195 shares and in multiples of this.
  • The promoter is serial entrepreneur Bhavish Aggarwal who owns 36.94%.
  • The main objectives of the IPO Issue  are
    • From the Fresh Issue, Capex is to be incurred for expansion of capacity of its cell mfg. plant from 5 GWh to 6.4 GWh, classified as phase 2 of expansion plan, reduction of debt; Investment into R&D and product development; Expenditure for organic growth initiatives, and General corporate purposes.
    • From OFS, the Promoters and some of the prior investors get a chance to exit.
  • The IPO share quotas are QIBs: NIIs: Retail is 75:15:10. (Qualified, Non-Institutional Investors)
  • The unofficial/ grey market premium of Ola is ₹ 9/share over IPO price. This is a positive.
  • The IPO allotment is likely to be finalized on Aug 7th, refunds will be on Aug 8th, and also crediting of shares to eligible allottees. Ola Electric shares will list on BSE and NSE, on Aug 9th.

See report in PDF format

JainMatrix Investments_OLA IPO_Aug_2024Download

Disclaimers and Disclosures

  • All assumptions are mentioned in main body of report along with Fig 7 Financial Projections.
  • Punit Jain discloses that he has no shareholding in Ola Electric Mobility, or any group company. He was not involved in the IPO preparation. In addition, JMI and its promoters/ employees have no direct or financial interest in these companies, and no known material conflict of interest as on date of publication of this report.
  • This document has been prepared by JainMatrix Investments Bangalore (JMI), and is meant for use by the recipient only as information and is not for circulation. This document is not to be reported or copied or made available to others without prior permission of JM. This report should not be considered or taken as an offer to sell or a solicitation to buy or sell any security. The information contained in this report has been obtained from sources that are considered to be reliable. However, JMI has not independently verified the accuracy or completeness of the same. Neither JMI nor any of its affiliates, its directors or its employees accepts any responsibility of whatsoever nature for the information, statements and opinion given, made available or expressed herein or for any omission therein. Investment in the securities market are subject to market risks. Read all the related documents carefully before investing. The suitability or otherwise of any investments will depend upon the recipient’s particular circumstances and, in case of doubt, advice should be sought from a RIA Registered Investment Advisor. JMI has been an equity investment adviser commercially since Nov 2012, and a SEBI certified and registered since 2016, under SEBI (Research Analysts) Regulations. Registration granted by SEBI, and certification from NISM in no way guarantee the performance of the Research Analyst or provide any assurance of returns to investors.
  • Any questions should be directed to punit.jain@jainmatrix.com. Name of the RA as registered with SEBI – Punit Jain, SEBI Registration No. INH200002747. Logo/brand name –

Just received my updated SEBI-RA certificate

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I’m happy to announce that I have received my renewed Research Analyst certificate from SEBI. The first one was for 5 years, 2016-2021, and this one is open, with perpetual validity.

Thank you, current and past subscribers, and all followers of my website, for helping me over the years.

Sharing this, some sections are masked. But please reach out to me if you have any questions !!

PRICING AND PAYMENT OPTIONS

Regards, Punit Jain

Understanding the Sensex Surge among Global Economic Challenges

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A social media contact asked a question:

Good morning friends. I was reading the newspaper and saw the Sensex touching an all-time high of 80k. Can anyone help simplify, why is the market is so high when industries and companies are globally low on business, employees are getting laid off, and the job market is weak. Is this a bubble in waiting caused by FIIs?

My response and answer:

1) The Indian index mostly reflects the Indian economy and Indian companies. These are doing well. The Indian GDP is up smartly in the last 2-3 years, industrial policies are stable and encouraging, tax collections are improving, and infrastructure like transportation and electricity are getting better. The recovery from the Covid challenges of 2020 and 2021 has been good.
2) The ex-India global scenario is not so good. USA is recovering from Covid but has election uncertainty, Europe is flat, RoW is bit gloomy due to the two wars. In general, there is high inflation and interest rates. China is struggling with a tariff war with USA and internal policy and capital allocation issues.
3) This in fact makes India an attractive investment destination for global funds looking for good returns. It’s doing the best among the larger economies and is quite open to capital inflows through FPI and FIIs.
4) In India, Equity as an asset class is gaining importance and acceptance for wealth storage and growth – along with the traditional Real Estate. This is mainly due to digital access, ease of transactions and lower transaction costs. Even so, the current Equity penetration is still low, with about 15 crore demat accounts, and even among these investors, a low proportion of financial assets.

In our recent article, we had seen these signs – NIFTY VIX and NIFTY 50: Market Sentiment Post Elections

Discover Investment Services from JainMatrix – PRICING AND PAYMENT OPTIONS

DISCLAIMERS

This document has been prepared by JainMatrix Investments Bangalore (JMI), and is meant for use by the recipient only as information and is not for circulation. This document is not to be reported or copied or made available to others without prior permission of JMI. This report should not be considered or taken as an offer to sell or a solicitation to buy or sell any security. The information contained in this report has been obtained from sources that are considered to be reliable. However, JM has not independently verified the accuracy or completeness of the same. Neither JM nor any of its affiliates, its directors or its employees accepts any responsibility of whatsoever nature for the information, statements and opinion given, made available or expressed herein or for any omission therein. Investments in the securities market are subject to market risks. Read all the related documents carefully before investing. The suitability or otherwise of any investments will depend upon the recipient’s particular circumstances and, in case of doubt, advice should be sought from a RIA Registered Investment Advisor. JMI has been an equity investment adviser commercially since Nov 2012, and a SEBI certified and registered since 2016, under SEBI (Research Analysts) Regulations. Registration granted by SEBI, and certification from NISM in no way guarantee the performance of the Research Analyst or provide any assurance of returns to investors. Any questions should be directed to punit.jain@jainmatrix.com. Name of the RA as registered with SEBI – Punit Jain, SEBI Registration No. INH200002747. Logo/brand names are –

JainMatrix Investments – Large Cap Report June 2024

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Subscribers and Investors,

JainMatrix Investments, a Research Analyst firm, is pleased to present its latest update of our LC stocks basket. Key points are

  • Introduction: It’s our 11th year of the Large Cap stocks basket
  • This update report is dated 21st June, and the report covers 11 stocks
  • All these firms are Blue Chip, well-known large-cap firms
  • The objective of this basket is that these stocks must outperform the Nifty / Sensex by 2-3% per year
  • The LC stocks have performed excellently over the years
  • Recommendation Changes:
    • In our last report, we had 7 BUYs and 3 HOLDs
    • In this, we introduce a new BUY, upgrade a HOLD to a BUY and downgrade a BUY to a SELL
    • So we now have 8 BUYs and 2 HOLDs as the final stocks recommendations
    • These 8 BUYs represent 8 highly rated sectors, and are high performers within these sectors
  • LC Trends: The trends we notice and capture in our report are:
    • Broad Optimism post General Elections
    • More domestic focus rather than exports
    • Consumption and infrastructure are the main themes.
    • Several sectors are witnessing a cyclical upswing that should be sustained for several years.
  • Based on our research, this detailed LC report includes 1-2 page notes on all these stocks and 2-year Target Prices for May 2026.
  • Current subscribers may note the changes recommended.
  • Investors new to our service may sign up using PRICING AND PAYMENT OPTIONS link, to grow their Direct Equity portfolios.

Disclaimers

This document has been prepared by JainMatrix Investments Bangalore (JM), and is meant for use by the recipient only as information and is not for circulation. This document is not to be reported or copied or made available to others without prior permission of JM. This report should not be considered or taken as an offer to sell or a solicitation to buy or sell any security. The information contained in this report has been obtained from sources that are considered to be reliable. However, JM has not independently verified the accuracy or completeness of the same. Neither JM nor any of its affiliates, its directors or its employees accepts any responsibility of whatsoever nature for the information, statements and opinion given, made available or expressed herein or for any omission therein. Investment in the securities market are subject to market risks. Read all the related documents carefully before investing. The suitability or otherwise of any investments will depend upon the recipient’s particular circumstances and, in case of doubt, advice should be sought from a RIA Registered Investment Advisor. JMI has been an equity investment adviser commercially since Nov 2012, and a SEBI certified and registered since 2016, under SEBI (Research Analysts) Regulations. Registration granted by SEBI, and certification from NISM in no way guarantee the performance of the Research Analyst or provide any assurance of returns to investors. Any questions should be directed to punit.jain@jainmatrix.com. Name of the RA as registered with SEBI – Punit Jain, SEBI Registration No. INH200002747. Logo/brand names are –

NIFTY VIX and NIFTY 50: Market Sentiment Post Elections

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The Indian General elections are done with, and we have the observations of the last month –

NIFTY VIX – is a ‘Volatility Index’, first introduced by the NSE in 2008. It is an Index representing expected annual volatility in Nifty50 over the next 30 days. It being a leading indicator simply reflects investors’ sentiment about the market.

NIFTY 50 – The NIFTY 50 is a benchmark Indian stock market index representing the weighted average of 50 of the largest Indian companies listed on the National Stock Exchange.

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