Banking Weekly - Update for the week ended Feb 21, 2014

Abhinesh Vijayaraj
abhinesh@sparkcapital.in
+91. 44. 4344 0006
Jyothi Kumar Varma
jyothikumar@sparkcapital.in
+91. 44. 4344 0033
Navin Babu
navin@sparkcapital.in
+91. 44. 4344 0165
Date 24 Feb, 2014
BSE SENSEX 20701
NIFTY 6155
BSE BANKEX 12049
CRR % 4.00
SLR % 23.00
Reverse Repo % 7.00
Repo % 8.00
MSF% 9.00
Base Rate % 10.00/10.25
Deposit Rate % 8.00/9.10
INR/ US$ 62.07
WPI% 5.05
CPI% 8.79
Sensex UP 1.64%ending at 20701 wow; Bankex UP 3.36%to 12049
The BSE Sensex was UP 1.64% for the week ending at 20701, an increase of 334 points while the BSE Bankex was UP 3.36% (up 392
points) over previous week to end at 12049.
The Spark NBFC Index was UP 4.52% to close at 127.34 from previous weeks close of 121.83 (Index value:100 on 01/01/2012)
Key Takeaways
The 10Y G-Sec yield was DOWN 2bps wow ending at 8.79% and the 5Y yield was DOWN 4bps wow at 8.92%.
Spread between 10Y and 6M G-sec yields remained FLAT at (22)bps, with the 10Y yield remaining lower than the 6M yield.
The 10Y bond yields moved DOWN in US (2.73%) by 1bps, UK (2.78%) by 1bps, Brazil (4.85%) by 9bps and moved UP in China
(4.55%) by 6bps.
For the fortnight ended Feb 07, credit grew 15.04% yoy while the deposits grew by 15.58% yoy. During the fortnight, banks credit off take
was UP by Rs.604bn while the deposits were UP by Rs.465bn.
ICICIBC CDS rate was DOWN wow by 19bps to 284bps while SBIN CDS rate was UP 7bps wow to 283bps.
The 10Y AAA spread was UP 4bps at 0.91% and the 5Y AAA was DOWN 8bps to 0.82%.
CD rates were DOWN by 7bps for 3M (9.68%), 2bps for 6M (9.73%) and 2bps for 12M (9.73%).
Spread between overnight rate and 12M OIS rate trended higher to 62bps, suggesting that the market is expecting rates to increase by
~62bps from 8.04% in the next 12 months.
Call money rate was DOWN 185bps to 7.00%, from the 8.85% levels seen during the preceding week.
INR appreciated by 0.02% wow against the USD, closing at 62.07 in the spot markets, while the USD/INR forward rates were lower
across tenors by ~0.1% wow.
Gold price was UP 1.3% wow at INR 30,585 per 10gm in INR terms and UP in USD terms by 0.7% wow and closed at USD 1,320 per
troy ounce.
8
%
4
%
4
%
4
%
4
%
4
%
3
%
2
%
2
%
1
%
1
%
0
%
-
1
%
-
1
%
-
1
%
-
1
%
-
3
%
-
3
%
-
3
%
-
4
%
-
4
%
-
6
%
7
%
6
%
5
%
5
%
4
%
1
%
0
%
-
1
%
-
3
%
-
4
%
-10%
-6%
-2%
2%
6%
10%
A
X
S
B
I
I
B
K
M
B
S
I
B
I
C
I
C
I
B
C
H
D
F
C
B
I
O
B
Y
E
S
S
B
I
N
C
B
K
U
N
B
K
P
N
B
J
K
B
K
D
C
B
B
K
V
B
F
B
V
Y
S
B
C
U
B
K
B
O
B
B
O
I
I
N
B
K
C
R
P
B
K
R
E
P
C
O
S
H
T
F
M
M
F
S
P
F
C
H
D
F
C
L
I
C
H
F
I
D
F
C
S
C
U
F
C
I
F
C
R
E
C
Stock price movement (wow)
1
News and RBI Notifications during the week
News during the week
Board / Management change
Bank of India has informed that the tenure of Shri Harvinder Singh, as part time Non Official Director, has expired on January 31, 2014. As such he ceases to be a director of
the bank w.e.f. February 01, 2014.
Bank of Baroda has informed that the Central Government has appointed Dr. K. P. Krishnan as Government Nominee Director of Bank of Baroda vice Shri Alok Nigam w.e.f.
February 19, 2014. Shri Alok Nigam ceased to be a Director on the Board of the Bank.
PNB sells stake in IFFSL: Punjab National Bank has informed that the Bank has decided to sell its entire stake in India Factoring & Financial Solutions Ltd. (IFFSL) to parent
promoter Fll (FIM Bank Malta). The transaction is to be completed during the current quarter ending 31.03.2014.
Decrease in Foreign investment limit from 54% to 52.50% in IDFC Limited: RBI notified that Foreign Institutional Investors (FIIs), through primary market and stock
exchanges, can now purchase up to 52.50 per cent of the paid up capital of M/s IDFC Limited under the Portfolio Investment Scheme (PIS). The company has passed
resolutions agreeing for decreasing the limit from 54 per cent to 52.50 per cent for the purchase of its equity shares and convertible debentures by FIIs. The RBI also notified that
the foreign share holding by FIIs in M/s IDFC Limited has crossed the overall limit of its paid-up capital.
Reserve Bank to enforce strict regime on UBI: United Bank of India (UBI), which has seen erosion of capital due to bad loans and higher provisioning, is to be told by the
Reserve Bank of India (RBI) to implement prompt corrective action according to a media article. Once this is initiated, the bank will have to present and implement a capital
restoration plan, restrict expansion of risk-weighted assets and not be allowed to enter new businesses, while being barred from accessing high-cost deposits. Also, there would
be no dividend payment.
Public sector banks to get Rs 112bn as capital infusion from Government of India in FY15: The government has put Rs 140bn crore in PSBs this financial year (2013-14)
and Rs 622bn in PSBs between 2005-06 and 2013-14.
SBI to lend up to Rs 100bn to six telecom companies: State Bank of India (SBI) has decided to lend up to Rs 100bn to six telecom companies that won airwaves in the
bandwidth auction concluded last week, but will limit its exposure by taking assets as security for any loan according to a media article.
Indian banks lose Rs 173bn in fraud cases: Indian banks lost as much as Rs 173bn during 2012-13 due to fraud, in a near four-fold jump over the previous fiscal, according
to a media article. Private banks account for about 75% of the total number of cases registered, but they lost only Rs 9.7bn while the state-run banks lost as much as Rs 163bn
during the year.
KKR's Kravis sees opportunity in banks' stressed assets: KKR closed a $2-billion Special Situations Fund globally, which will invest in distressed assets.
CholamandalamInvestment to raise Rs 3.15bn from IFC: Cholamandalam Investment and Finance Company plans to raise Rs 3.15bn (about $50 million) from the
International Finance Corporation (IFC). The money will be infused in the form of a Tier-II debt investment by subscribing to unsecured non-convertible debentures to be issued
by the company.
RBI Notifications
Foreign Direct Investment (FDI) into a Small Scale Industrial Undertakings (SSI) / Micro & Small Enterprises (MSE): The Reserve Bank has allowed micro and small
enterprises (MSEs) who have de-registered their small scale industry status to sell stake to foreign investors to help them attract funds. It has been decided that such companies
may issue shares or convertible debentures to a person resident outside India to the extent of 24% of its paid -up capital.
2
Key Industry Trends
10Y G-Sec yields down 2bps wow and 5Y yields down 4bps wow
Source: Bloomberg
Spread between 10Y and 6M bond yields move to (22)bps
Source: Bloomberg
The yield curve has remained steady wow
Source: Bloomberg
10Y bond yields down in US, UK & Brazil & up in China
,
Source: Bloomberg
8.81% 8.79%
8.96%
8.92%
8.6%
8.7%
8.8%
8.9%
9.0%
24-Jan 31-Jan 7-Feb 14-Feb 21-Feb
10Y G-Sec Yield 5Y G-Sec Yield
2.74% 2.73%
2.79% 2.78%
4.49%
4.55%
4.94%
4.85%
2.0%
3.0%
4.0%
5.0%
24-Jan 31-Jan 7-Feb 14-Feb 21-Feb
US UK China Brazil
9.03%
9.01%
-0.22%
-0.22%
-0.3%
-0.2%
-0.1%
0.0%
0.1%
8.4%
8.6%
8.8%
9.0%
9.2%
24-Jan 31-Jan 7-Feb 14-Feb 21-Feb
6M G-Sec yield Spread between 10Y and 6M yields (RHS)
6.0%
7.0%
8.0%
9.0%
10.0%
3M 6M 1Y 2Y 3Y 5Y 6Y 7Y 8Y 9Y 10Y 11Y 12Y 13Y 14Y
28-Sep-10 15-Jul-13 14-Feb-14 21-Feb-14
3M CD rates down 7bps, 6M down 2bps & 12M down 2bps wow
2
Source: Bloomberg
5-year CDS rates down 19bps wow for ICICI and up 7bps for SBI
e
Source: Bloomberg
3
Key Industry Trends
10Y AAA bond spread up 4bps wow, 5Y spread down 8bps wow
Source: Bloomberg
TED spreads contracts to 20bps
Source: Bloomberg
318 316
306
303
284
290
301
295
276
283
200
250
300
350
24-Jan 31-Jan 7-Feb 14-Feb 21-Feb
ICICI Bank CDS (bps) SBI CDS (bps) (RHS)
0.90%
0.89%
0.86%
0.87%
0.91%
0.86%
0.83%
0.89%
0.91%
0.82%
0.7%
0.8%
0.9%
1.0%
24-Jan 31-Jan 7-Feb 14-Feb 21-Feb
10Y Corporate AAA Spreads 5Y Corporate AAA Spreads
8.6%
8.8%
9.0%
9.2%
9.4%
9.6%
9.8%
10.0%
24-Jan 31-Jan 7-Feb 14-Feb 21-Feb
3M 6M 12M
0.24% 0.24% 0.23% 0.24% 0.23%
0.05%
0.02%
0.08%
0.02%
0.04%
0.00%
0.05%
0.10%
0.15%
0.20%
0.25%
24-Jan 31-Jan 7-Feb 14-Feb 21-Feb
3-month LIBOR % (RHS) 3-month US T-Bill% (RHS)
4
Key Industry Trends
1Y FW OIS and overnight rate spread moved higher to 56bps
Source: Bloomberg
Call money rates down wow to 7.00%
Source: Bloomberg
Forward USD/INR rates was marginally lower across tenors
Source: Bloomberg
Gold in INR terms up 1.3% wow and up 0.7% wow in US$ terms
Source: Bloomberg
7.60%
8.80%
8.00%
8.85%
7.00%
5.0%
5.5%
6.0%
6.5%
7.0%
7.5%
8.0%
8.5%
9.0%
9.5%
24-Jan 31-Jan 7-Feb 14-Feb 21-Feb
58
60
52
-32
62
(40)
(20)
-
20
40
60
80
7.0%
7.5%
8.0%
8.5%
9.0%
9.5%
24-Jan 31-Jan 7-Feb 14-Feb 21-Feb
Overnight rate 12M OIS Spread (bps) (RHS)
63.27 63.22
64.55 64.45
67.05
66.86
60
62
64
66
68
70
24-Jan 31-Jan 7-Feb 14-Feb 21-Feb
3M forward rate 6M forward rate 12M forward rate
29,703
27,600
29,801
30,178
30,585
1,260
1,246
1,260
1,311
1,320
1,200
1,240
1,280
1,320
1,360
26,000
27,000
28,000
29,000
30,000
31,000
24-Jan 31-Jan 7-Feb 14-Feb 21-Feb
Gold Price in Rs. per 10g. Gold Price in US$ per troy ounce (RHS)
5
Valuation Matrix Banks
Bank
Net Interest Income, Rs. bn Operating Profits, Rs. bn PAT, Rs. bn Gross NPA FY13-15E CAGR NIM
FY13 FY14E FY15E FY13 FY14E FY15E FY13 FY14E FY15E FY13 FY14E FY15E NII PAT ABV FY13 FY14E FY15E
AXSB 96.7 116.7 125.2 93.0 108.6 115.3 51.6 57.5 57.8 1.2% 1.4% 1.4% 14% 6% 13% 3.3% 3.5% 3.4%
BOB 113.2 120.9 144.6 90.0 92.9 110.6 44.1 45.9 53.0 2.4% 3.4% 3.8% 13% 10% 1% 2.4% 2.2% 2.3%
BOI 90.2 106.3 125.0 74.6 86.7 99.8 27.5 28.3 36.1 3.0% 2.9% 3.0% 18% 15% 6% 2.3% 2.3% 2.3%
CBK 78.8 87.8 106.2 58.9 65.4 79.0 28.7 23.7 32.6 2.6% 2.9% 3.4% 16% 7% 2% 2.2% 2.1% 2.2%
CRPBK 34.3 39.3 45.5 30.4 32.3 36.6 14.3 6.8 11.0 1.7% 3.0% 3.3% 15% -12% -14% 2.1% 2.1% 2.2%
CUBK 6.2 7.7 8.9 5.2 5.9 6.9 3.2 3.6 4.0 1.1% 1.7% 1.8% 20% 12% 14% 3.3% 3.4% 3.4%
DEVB 2.8 3.7 4.3 1.3 1.9 2.4 1.0 1.5 1.7 3.3% 2.6% 2.4% 23% 29% 16% 3.1% 3.2% 3.2%
FB 19.7 21.8 24.8 14.6 15.1 18.1 8.4 7.9 10.3 3.5% 2.8% 2.8% 12% 11% 10% 3.2% 3.2% 3.2%
HDFCB 158.1 183.7 224.1 114.3 146.2 184.1 67.3 85.6 108.4 1.0% 1.1% 1.1% 19% 27% 20% 4.8% 4.6% 4.6%
INBK 45.2 44.2 50.8 30.6 27.6 31.6 15.8 11.1 11.7 3.4% 3.5% 4.0% 6% -14% 0% 3.2% 2.8% 2.8%
ICICIBC 138.7 165.9 190.4 132.0 163.1 176.2 84.7 96.0 105.2 3.3% 3.2% 3.5% 17% 11% 10% 3.0% 3.3% 3.3%
IIB 22.3 28.7 34.5 18.4 25.2 30.3 10.6 13.7 17.0 1.0% 1.2% 1.2% 24% 27% 16% 3.7% 3.9% 3.9%
JKBK 23.2 26.7 30.1 18.1 19.1 21.8 10.6 12.6 13.8 1.6% 1.7% 1.8% 14% 14% 17% 3.7% 3.9% 3.9%
VYSB 15.4 17.2 19.4 9.9 11.8 13.4 6.1 7.0 8.4 1.8% 1.7% 1.7% 12% 17% 18% 3.3% 3.3% 3.3%
IOB 52.5 56.2 62.5 38.2 38.4 41.3 5.6 5.0 5.9 4.1% 5.5% 6.1% 9% 2% -23% 2.4% 2.4% 2.3%
KMB 32.1 37.3 43.6 21.6 26.1 30.7 13.6 15.1 17.9 1.6% 2.0% 1.8% 17% 15% 21% 4.6% 4.7% 4.9%
KVB 11.6 12.7 15.8 8.5 8.3 11.1 5.5 3.8 7.0 1.0% 1.4% 1.5% 17% 13% 10% 3.0% 2.7% 2.9%
PNB 148.6 163.6 181.2 109.1 109.0 119.3 47.5 34.4 47.4 4.4% 5.0% 5.0% 10% 0% 2% 3.4% 3.4% 3.4%
SBIN 443.3 494.5 565.0 310.8 297.6 332.5 141.0 106.5 133.4 4.8% 5.8% 6.0% 13% -3% -3% 3.3% 3.2% 3.2%
SIB 12.8 14.0 17.0 8.5 9.2 11.4 4.7 5.2 6.5 1.4% 1.6% 1.6% 15% 18% 12% 3.0% 2.8% 2.9%
UNBK 75.4 82.3 93.3 55.8 55.6 61.4 21.6 19.1 24.6 3.0% 3.9% 4.3% 11% 7% -15% 2.8% 2.6% 2.6%
YES 22.2 26.6 31.5 21.4 26.0 30.5 13.0 15.7 18.3 0.2% 0.4% 0.5% 19% 19% 21% 2.8% 2.9% 3.1%
6
Valuation Matrix Banks (Contd)
Bank
RoE RoA ABV/share Rs. P/ABV (x) CMP Shares M.Cap Target
Rating
FY13 FY14E FY15E FY13 FY14E FY15E FY13 FY14E FY15E FY14E FY15E (Rs.) (mn) Rs. bn P/ABV(x)
Price
(Rs.)
AXSB 18.4% 16.2% 14.3% 1.6% 1.6% 1.4% 694 790 889 1.5 1.3 1193 469 560.0 1.1 977 SELL
BOB 15.4% 14.0% 14.5% 0.9% 0.8% 0.8% 631 621 644 0.8 0.8 518 432 224.0 0.7 479 SELL
BOI 12.9% 11.6% 13.3% 0.7% 0.6% 0.6% 281 301 317 0.6 0.5 168 643 107.8 0.5 144 SELL
CBK 13.2% 9.5% 11.4% 0.7% 0.5% 0.6% 397 426 411 0.5 0.5 214 461 98.8 0.5 196 SELL
CRPBK 16.1% 7.0% 10.7% 0.8% 0.3% 0.5% 533 413 397 0.5 0.6 224 168 37.5 0.5 198 SELL
CUBK 22.3% 19.3% 18.2% 1.6% 1.4% 1.4% 32 36 42 1.3 1.1 47 538 25.0 1.4 58 BUY
DEVB 11.6% 15.1% 14.4% 1.0% 1.3% 1.2% 36 42 48 1.2 1.1 51 250 12.8 1.4 66 BUY
FB 13.9% 11.9% 14.1% 1.3% 1.1% 1.2% 69 76 85 1.0 0.9 73 855 62.8 1.2 101 BUY
HDFCB 20.3% 21.5% 22.6% 1.8% 1.9% 2.0% 150 180 216 3.7 3.1 664 2395 1591.0 3.6 776 BUY
INBK 16.1% 10.3% 10.1% 1.0% 0.6% 0.6% 187 193 187 0.5 0.5 90 430 38.5 0.4 79 SELL
ICICIBC 13.3% 13.7% 13.5% 1.7% 1.7% 1.6% 559 612 676 1.7 1.5 1025 1155 1183.8 1.7 1182 BUY
IIB 17.5% 16.6% 17.7% 1.6% 1.7% 1.7% 143 166 194 2.4 2.0 392 523 205.0 2.5 485 BUY
JKBK 23.6% 23.6% 22.0% 1.6% 1.7% 1.7% 1000 1173 1373 1.1 1.0 1334 48 64.7 1.2 1648 BUY
VYSB 14.6% 12.2% 11.3% 1.2% 1.2% 1.3% 292 370 409 1.5 1.3 540 187 101.3 1.5 613 BUY
IOB 5.0% 4.0% 4.4% 0.2% 0.2% 0.2% 84 62 50 0.7 0.9 46 1154 52.8 0.5 25 SELL
KMB 15.6% 13.9% 13.7% 1.8% 1.8% 1.9% 123 153 179 4.4 3.8 672 768 516.3 4.5 811 BUY
KVB 19.0% 11.9% 19.7% 1.3% 0.8% 1.2% 278 292 337 1.1 0.9 314 107 33.6 1.2 404 BUY
PNB 16.5% 10.6% 13.3% 1.0% 0.7% 0.8% 679 661 713 0.8 0.8 535 362 193.7 0.7 479 SELL
SBIN 15.4% 9.8% 10.9% 1.0% 0.6% 0.7% 1125 1044 1048 1.4 1.4 1502 747 1121.4 1.2 1297 SELL
SIB 19.2% 17.0% 18.6% 1.0% 1.0% 1.0% 20 21 24 1.0 0.9 21 1342 27.9 1.0 24 BUY
UNBK 15.0% 11.9% 14.4% 0.8% 0.6% 0.6% 207 145 149 0.7 0.7 103 741 76.4 0.6 84 SELL
YES 24.8% 24.2% 23.2% 1.5% 1.5% 1.5% 162 195 236 1.6 1.3 306 360 110.4 2.0 470 BUY
Valuation Matrix NBFCs
Source: Spark Capital Research Prices as of Feb 21, 2014
NBFC
Net Interest Income, Rs. bn Operating Profits, Rs. bn PAT, Rs. bn Gross NPA FY13-15E CAGR NIM
FY13 FY14E FY15E FY13 FY14E FY15E FY13 FY14E FY15E FY13 FY14E FY15E NII PAT ABV FY13 FY14E FY15E
CIFC 11.4 14.8 17.5 5.7 8.1 10.2 3.1 3.6 4.6 1.0% 1.9% 2.3% 24% 23% 17% 7.0% 7.0% 6.8%
HDFC 62.7 72.2 82.2 68.1 76.6 85.8 49.4 55.6 62.3 0.7% 0.7% 0.8% 14% 12% 12% 3.6% 3.4% 3.3%
IDFC 25.7 26.7 26.8 29.4 30.5 30.2 18.4 20.2 20.4 0.2% 0.3% 0.3% 2% 5% 9% 4.3% 4.0% 3.7%
LICHF 15.3 19.1 22.0 14.5 18.4 20.5 10.2 12.9 14.2 0.6% 0.6% 0.6% 20% 18% 16% 2.2% 2.3% 2.3%
MMFS 22.4 27.5 34.9 15.3 18.4 24.3 8.8 8.6 11.7 3.0% 5.0% 5.5% 25% 15% 13% 9.4% 8.9% 9.2%
PFC 61.9 85.3 89.4 60.5 81.8 87.9 43.9 56.4 62.9 0.9% 0.7% 0.8% 20% 20% 17% 4.2% 4.9% 4.4%
REC 53.8 69.1 75.5 53.9 68.2 75.9 39.1 46.2 53.8 0.4% 0.3% 0.3% 19% 17% 23% 4.6% 4.8% 4.5%
REPCO 1.4 1.8 2.4 1.2 1.7 2.3 0.8 1.1 1.5 1.5% 1.4% 1.6% 31.2% 37.6% 16.6% 4.4% 4.5% 4.5%
SCUF 16.6 18.3 21.7 10.5 11.7 13.8 4.5 5.1 6.0 2.2% 2.3% 2.4% 14% 16% 21% 11.4% 11.2% 11.7%
SHTF 34.6 36.7 39.6 28.6 29.2 30.0 13.5 12.6 13.6 3.2% 3.9% 5.5% 7% 0% 15% 7.7% 7.1% 6.8%
NBFC
RoE RoA ABV/share Rs. P/ABV (x) CMP Shares M.Cap Target
Rating
FY13 FY14E FY15E FY13 FY14E FY15E FY13 FY14E FY15E FY14E FY15E (Rs.) (mn) Rs. bn P/ABV(x)
Price
(Rs.)
CIFC 18.1% 17.1% 18.6% 2.0% 1.9% 1.9% 134.6 148.5 183.5 1.5 1.2 228 143.2 32.6 1.6 293 BUY
HDFC 22.5% 20.9% 21.0% 2.5% 2.4% 2.3% 157.0 177.9 196.8 4.5 4.1 801 1546.4 1238.0 3.6 712 SELL
IDFC 14.1% 14.1% 12.9% 2.9% 2.8% 2.4% 90.0 96.9 107.3 1.0 0.9 95 1512.4 143.9 1.2 130 BUY
LICHF 16.8% 18.4% 17.5% 1.4% 1.5% 1.4% 122.9 144.0 166.7 1.4 1.2 201 505.0 101.6 1.6 266 BUY
MMFS 23.9% 18.1% 21.1% 3.6% 2.7% 3.0% 74.5 79.2 95.2 3.2 2.7 257 520.0 133.8 2.2 209 SELL
PFC 19.6% 22.0% 21.2% 2.9% 3.1% 3.0% 174.6 198.8 237.6 0.8 0.6 154 1319.9 202.9 0.8 186 BUY
REC 24.3% 24.3% 23.1% 3.3% 3.2% 3.2% 172.7 204.7 259.4 0.9 0.7 184 987.5 182.1 1.1 277 BUY
REPCO 17.1% 15.9% 19.1% 2.4% 2.5% 2.8% 96.4 111.2 131.1 3.0 2.5 330 62.2 20.5 2.8 369 BUY
SCUF 22.8% 20.3% 19.2% 2.9% 3.0% 3.1% 379.3 468.5 556.2 2.0 1.7 960 55.4 53.2 2.0 1112 BUY
SHTF 20.5% 16.3% 15.4% 2.3% 1.9% 1.9% 306.5 355.6 407.1 1.7 1.4 588 226.9 133.5 1.3 529 SELL
Spark Disclaimer
Spark Capital Advisors (India) Private Limited (Spark Capital) and its affiliates are engaged in investment banking, investment advisory and institutional equities. Spark Capital is registered
with SEBI as a Stock Broker and Category 1 Merchant Banker.
This document does not constitute or form part of any offer or solicitation for the purchase or sale of any financial instrument or as an official confirmation of any transaction. This document is
provided for assistance only and is not intended to be and must not alone be taken as the basis for an investment decision. Nothing in this document should be construed as investment or
financial advice, and nothing in this document should be construed as an advice to buy or sell or solicitation to buy or sell the securities of companies referred to in this document.
Each recipient of this document should make such investigations as it deems necessary to arrive at an independent evaluation of an investment in the securities of companies referred to in this
document (including the merits and risks involved), and should consult its own advisors to determine the merits and risks of such an investment. This document is being supplied to you solely
for your information and may not be reproduced, redistributed or passed on, directly or indirectly, to any other person or published, copied, in whole or in part, for any purpose. This report is
not directed or intended for distribution to or use by any person or entity who is a citizen or resident of or located in any locality, state, country or other jurisdiction, where such distribution,
publication, availability or use would be contrary to law, regulation or which would subject Spark Capital and/or its affiliates to any registration or licensing requirement within such
jurisdiction. The securities described herein may or may not be eligible for sale in all jurisdictions or to a certain category of investors. Persons in whose possession this document may come are
required to inform themselves of and to observe such applicable restrictions. This material should not be construed as an offer to sell or the solicitation of an offer to buy any security in any
jurisdiction where such an offer or solicitation would be illegal.
Spark Capital makes no representation or warranty, express or implied, as to the accuracy, completeness or fairness of the information and opinions contained in this document. Spark Capital ,
its affiliates, and the employees of Spark Capital and its affiliates may, from time to time, effect or have effected an own account transaction in, or deal as principal or agent in or for the
securities mentioned in this document. They may perform or seek to perform investment banking or other services for, or solicit investment banking or other business from, any company
referred to in this report.
This report has been prepared on the basis of information, which is already available in publicly accessible media or developed through an independent analysis by Spark Capital. While we
would endeavour to update the information herein on a reasonable basis, Spark Capital and its affiliates are under no obligation to update the information. Also, there may be regulatory,
compliance or other reasons that prevent Spark Capital and its affiliates from doing so. Neither Spark Capital nor its affiliates or their respective directors, employees, agents or representatives
shall be responsible or liable in any manner, directly or indirectly, for views or opinions expressed in this report or the contents or any errors or discrepancies herein or for any decisions or
actions taken in reliance on the report or the inability to use or access our service in this report or for any loss or damages whether direct or indirect, incidental, special or consequential
including without limitation loss of revenue or profits that may arise from or in connection with the use of or reliance on this report.
Spark Capital and/or its affiliates and/or employees may have interests/positions, financial or otherwise in the securities mentioned in this report. To enhance transparency, Spark Capital has
incorporated a disclosure of interest statement in this document. This should however not be treated as endorsement of views expressed in this report:
Absolute Rating Interpretation
BUY Stock expected to provide positive returns of > 15% over a 1-year horizon
ADD Stock expected to provide positive returns of >5% - <15% over a 1-year horizon
REDUCE Stock expected to provide returns of <5% - -10%, over a 1-year horizon
SELL Stock expected to fall >10% over a 1-year horizon
Analyst Certification of Independence
The views expressed in this research report accurately reflect the analysts personal views about any and all of the subject securities or issuers; and no part of the research
analysts compensations was, is or will be, directly or indirectly, related to the specific recommendation or views expressed in the report.
Additional Disclaimer for US Institutional Investors
This research report prepared by Spark Capital Advisors (India) Private Limited is distributed in the United States to US Institutional Investors (as defined in Rule 15a-6 under the Securities
Exchange Act of 1934, as amended) only by Decker & Co, LLC, a broker-dealer registered in the US (registered under Section 15 of Securities Exchange Act of 1934, as amended). Decker & Co
accepts responsibility on the research reports and US Institutional Investors wishing to effect transaction in the securities discussed in the research material may do so through Decker & Co. All
responsibility for the distribution of this report by Decker & Co, LLC in the US shall be borne by Decker & Co, LLC. All resulting transactions by a US person or entity should be effected through
a registered broker-dealer in the US. This report is not directed at you if Spark Capital Advisors (India) Private Limited or Decker & Co, LLC is prohibited or restricted by any legislation or
regulation in any jurisdiction from making it available to you. You should satisfy yourself before reading it that Decker & Co, LLC and Spark Capital Advisors (India) Private Limited are
permitted to provide research material concerning investment to you under relevant legislation and regulations;
Disclosure of interest statement Yes/No
Analyst ownership of the stock Yes bank
Group/directors ownership of the stock CIFC
Broking relationship with the company covered No
Investment banking relationship with the company covered No