Impact of Maharashtra Allowing Opening of Multiplexes

Impact of Maharashtra allowing opening of multiplexes
by 5paisa Research Team 27/09/2021

On the morning of Monday, 27th September, the 3 major listed multiplex stocks; PVR, INOX and Cineline opened with strong gains. The gains tapered later but these stocks are still 6-8% higher in early trades. What exactly has driven the rally in these multiplex stocks. More so, in the case of PVR, where the stock had corrected 4% on 24th September on account of a credit downgrade by CRISIL.

The rally in multiplex stocks was triggered by Maharashtra allowing multiplexes to resume operations from 22nd October, subject to safety and social distancing protocols. It may be recollected that all malls and multiplexes had been shut since April 2021 after the resurgence of COVID 2.0. Maharashtra is critical as it account for up to 30% of multiplex revenues and sets the all-India tone.

A number of big budget Hindi movies are slated to release but are going slow due to the multiplex lockdown. These include big budget multi-starrer Suryavanshi, Ranveer Singh’s 83, Akshay Kumar’s Prithviraj, Aamir Khan’s Lal Singh Chaddha, Ranbir Kapoor’s Shamshera and Saif Ali Khan’s Bunty aur Babli 2. If the operations resume, it is expected that it would be cash flow positive for multiplexes in the December quarter.

Multiplex companies, once reopened, will also gain from the assurance given by Disney. In 2021, Disney will not release any new movies on OTT up to 45 days after the theatre release. This will ensure that OTT is not a major threat in this year since the first 2-3 weeks account for a bulk of the earnings from movies for the multiplex companies.

Brokers like Nirmal Bang and Sharekhan are betting on a sharp revival in multiplex stocks resulting in strong revenue growth in FY23. Price targets for PVR and INOX have been raised by 25-30% by brokers as cash bleeding is likely to come to a halt once the multiplexes are opened. It is estimated that the movie exhibition industry has lost over $600 million since the lockdowns first started in mid-2020. The hope is that the worst may be over.

Next Article

How Indiabulls Housing Finance is Deleveraging its Balance Sheet

Indiabulls Housing Finance to reduce debt
by 5paisa Research Team 27/09/2021

In the last few years, most NBFCs including those in the housing finance space, have been under pressure at two levels. Firstly, there was an asset liability mismatch in most books as HFCs were borrowing short end and lending for homes, which is normally long end.

Secondly, most NBFCs were facing cash flows problems in servicing their loan repayments, putting them at solvency risk. That was because, in the midst of the liquidity crunch, cash flows were not coming in regularly.

One of the NBFCs that has put in an effort to rectify this problem and deleverage the balance sheet is Mumbai-based Indiabulls Finance. The stock had come under a lot of pressure over NPA concerns, its exposure to Yes Bank and asset liability mismatch.

It has cleaned up its balance sheet to become fully matched in terms of ALM (asset liability management). It has also become significantly positive on cash flows, to the extent that it has also started creating reserves for future redemptions.

To underscore its commitment, Indiabulls Housing Finance recently repaid NCDs worth Rs.7,076 crore ahead of schedule. This included a sum of Rs.6,576 crore borrowed by Indiabulls Housing and its subsidiary ICCL in Sep-16 and Sep-18 respectively.

There was also an NCD of Rs.500 crore issued by Indiabulls Housing way back in September 2011. These NCDs aggregating to Rs.7,076 crore were all repaid ahead of schedule. In dollar terms, the amount repaid is around $960 million.

In addition, Indiabulls has gone one step ahead and created a special redemption reserve for bonds maturing in May 2022 worth $350 million. Indiabulls will transfer 75% of these maturity proceeds to a debt repayment trust managed by IDBI Trustee Company.

The first tranche has already been transferred in Aug-21. The second tranche will be transferred in Nov-21 and the last tranche in Feb-22. Three-fourth of the redemption proceeds will be set aside 3-months ahead of maturity date.

Indiabulls not only wants to prove a point on its solvency but also wants to give comfort and reassurance to bond holders and shareholders that the company’s finances are in fine fettle. This should give a boost to sentiments.

Next Article

Aditya Birla Sun Life AMC IPO Note

IPO
by 5paisa Research Team 27/09/2021

Aditya Birla Sun Life AMC Ltd, is the fourth largest asset management company in India in terms of assets under management (AUM) and the largest non-bank mutual fund. It has total assets under management of Rs.275,454 crore as of the end of June quarter. More than 50% of its AUM comes from institutional customers, which is one of the reasons why the AMC is very strong in terms of non-equity AUM.

Aditya Birla Sun Life AMC Ltd currently offers a total of 135 mutual fund schemes consisting of 35 equity schemes, 93 debt schemes, 2 liquid schemes and 5 ETFs. In addition, it also offers 5 domestic fund of funds (FOF). Apart from a strong customer base and aggressive agent network, Aditya Birla Sun Life AMC Ltd also has the advantage of the Birla brand name, which has been in existence in India for over 100 years.

Below are the terms which you should know about Aditya Birla Sun Life AMC IPO:

Key terms of the IPO issue of Aditya Birla Sun Life AMC Ltd
 

Key IPO Details

Particulars

Key IPO Dates

Particulars

Nature of issue

Book Building

Issue Opens on

29-Sep-2021

Face value of share

Rs.5 per share

Issue Closes on

01-Oct-2021

IPO Price Band

Rs.695 - Rs.712

Basis of Allotment date

06-Oct-2021

Market Lot

20 shares

Refund Initiation date

07-Oct-2021

Retail Investment limit

14 Lots (280 shares)

Credit to Demat

08-Oct-2021

Retail limit - Value

Rs.199,360

IPO Listing date

11-Oct-2021

Fresh Issue Size

Nil

Pre issue promoter stake

100.00%

Offer for Sale Size

Rs.2,768.26 crore

Post issue promoters

86.50%

Total IPO Size

Rs.2,768.26 crore

Indicative valuation

Rs.20,505 crore

Listing on

BSE, NSE

HNI Quota

15%

QIB Quota

50%

Retail Quota

35%

Data Source: IPO Filings

Here are some of the key merits of the Aditya Birla Sun Life AMC business model

i) Trusted brand with over 100 years of brand existence.

ii) Largest non-bank mutual fund in India in terms of AUM.

iii) Good mix of retail and institutional clients as well as equity and debt schemes.

iv) Strong network of brick-and-click with 66,000 MFD and 240 national distributors.

v) Quarterly AUM grew at 14.55% CAGR between 2016 and 2021.
 

Also Check:  Aditya Birla Sun Life AMC IPO : 7 Things to Know About
 

How is the IPO being structured?

Currently, Aditya Birla Sun Life AMC Ltd is 51% owned by Aditya Birla Capital and 48% by Sun Life PLC. The entire issue of 388.80 lakh shares (including 28.51 lakh shares by Aditya Birla Capital and 360.29 lakh share by Sun Life AMC) will be an offer for sale in which both the promoters viz. Aditya Birla Capital and Sun Life AMC will offer shares in the OFS. Here is how the shareholding will look like before and after the IPO.

 

Particulars

Pre-IPO Holding

Pre-IPO (%)

Post-IPO Holding

Post-IPO (%)

Aditya Birla Capital

146,879,680

51%

144,028,800

50.01%

Sun Life PLC

141,120,000

49%

105,090,880

36.49%

Public

-

-

38,880,000

13.50%

Total Shareholding

287,999,680

100%

287,999,680

100.00%

Data Source: Company RHP

Thus post the offer for sale completion, the stake of ABCL will go down marginally, but the stake of Sun Life PLC comes down sharply from 49% to 36.49%. The public will be holding the divested 13.50% stake.
 

Financials of Aditya Birla Sun Life AMC Ltd Finance
 

Financial Parameters

Fiscal 2020-21

Fiscal 2019-20

Fiscal 2018-19

Total Income

Rs.1,205.84 cr

Rs.1,234.77 cr

Rs.1,407.25 cr

Net Profit

Rs.526.28 cr

Rs.494.40 cr

Rs.446.80 cr

Net Worth

Rs.1,704.61 cr

Rs.1,316.87 cr

Rs.1,220.57 cr

Net Profit Margins

43.64%

40.04%

31.75%

RONW (%)

30.87%

34.54%

36.61%

Data Source: Company RHP

The revenues overall are down over the last 3 years but that is due to the lower expense ratio insisted upon by SEBI. That has been partially compensated by the higher equity flows, but the shortfall still remains. However, the profits have been boosted through leaner operations, digital initiatives and lower asset impairment requirements.

Investment Perspective for Aditya Birla Sun Life AMC Ltd

This will only be the fourth AMC to be listed and here are some investment arguments.

a) In terms of relative valuations, it is cheaper than HDFC AMC and Nippon Mutual Fund but more expensive than UTI Mutual Fund. Lower equity AUM will be an issue.

b) The indicative market cap of Birla AMC at Rs.20,505 crore is about 7.5% of the total assets under management. This is at par with the rate at which most sale deals have happened, so the headroom may be limited.

c) In the last few months, there has been a distinct shift towards hybrids, gold funds and passive funds. That is likely to maintain the pressure on the top line growth of the mutual fund industry in general.

At the current market cap of Rs.20,505 crore the IPO does appear fully valued. It may not be a value enhancer in the short term, but over the long term it still remains a veritable play on the big financial savings shift happening in India.

Next Article

Upcoming IPOs to raise Rs.45,000 Crore in Oct-Nov

Upcoming IPOs
by 5paisa Research Team 27/09/2021

The first 6 months of the fiscal year 2021-22 will end with collections of Rs.78,520 crore. If you exclude Birla Sun Life opening on 29th Sep as well as the Power Grid INVIT and the Brookefield REIT, still Rs.64,200 crore has been collected this fiscal. Investors will get a picture of the second half in the first two months of October and November.

The months of October and November will set the tone for the IPO collections in the rest of the year. Nearly 50% of the collections of the first half came in July and August with September being a relatively quiet month. It is now estimated that nearly Rs.45,000 crore could be raised across 40 IPOs in October and November. We are not counting the Rs.16,600 crore Paytm IPO, which could move to Dec-21 or Jan-22.

In October and November, you can expect a mix of digital and non-digital IPOs as under.
 

Digital IPOs

IPO Amount

Non-Digital IPOs

IPO Amount

Policybazaar

Rs.6,017cr

Emcure Pharma

Rs.4,500cr

Nykaa

Rs.4,000cr

CMS Infosystems

Rs.2,000cr

MobiKwik Systems

Rs.1,900cr

Northern Arc Capital

Rs.1,800cr

Ixigo

Rs.1,600cr

Sapphire Foods

Rs.1,500cr

RateGain Travel Tech

Rs.1,200cr

Fincare SFB

Rs.1,330cr

 

 

Sterlite Power

Rs.1,250cr

 

 

Supriya Lifesciences

Rs.1,200cr


The above table is just an illustrative list of some prominent names. In total, it is expected that 40 companies will be raising close to Rs.64,000 crore via IPOs in next 2 months. It will also set the tone for larger IPOs like Paytm as well as the divestment of LIC and BPCL in the Mar-22 quarter.

For now, this promises to be the best year for IPO collections in history, beating the record collections in the year 2017. However, the 2017 IPO boom was dominated by the mega insurance IPOs of GIC Re, New India Assurance, HDFC Life, SBI Life and ICICI Lombard. This time it is more of a technology driven IPO boom. It remains to be seen how enthusiastically the market is able to absorb the supply of larger IPOs. That will be the acid test.

Also Read:

1. List of Upcoming IPOs in 2021

2. Paytm IPO Update

3. 8 Interesting facts about Paytm

Next Article

5 Stocks to Buy Today: September 28, 2021

5 Stocks to Buy
by 5paisa Research Team 27/09/2021

Every morning our analysts scan through the markets universe and chose the best momentum stocks to buy today. The stocks are recommended from a wider list of momentum stocks and only the best ones make it to the top 5 list. We also update on the performance of earlier recommendation every morning to help you with your trading journey. Read on to know the momentum stocks to buy today. The average holding period could be between 7-10 days on average.

List of 5 Stocks to Buy Today

1. Indian Railway Catering And Tourism (IRCTC)

Indian Railway Catering and Tourism Corporation (IRCTC) is an India-based company engaged in offering Internet ticketing, catering and tourism. The Company is engaged in offering catering and hospitality services at stations, on trains and other locations. Its segments include Catering and Hospitality; Internet Ticketing; Travel and Tourism, and Packaged Drinking Water (Rail Neer).

IRCTC Stock Details for Today: 

- Current Market Price: Rs.3,835

- Stop Loss: Rs. 3,740

- Target 1: Rs. 3,900

- Target 2: Rs. 4,050

- Holding Period: One week

5paisa Recommendation: Sideways Momentum likely to end, thus making it to the top stocks to buy list. 

 

2. Prestige Estates (PRESTIGE)

Prestige EstatesStock Details for Today: 

- Current Market Price: Rs. 495

- Stop Loss: Rs. 481

- Target 1: Rs. 507

- Target 2: Rs. 525

- Holding Period: 1 week

5paisa Recommendation: Our technical analysts observe positive momentum, thus recommending this stock as the best stock to buy today. 

 

3. India Glycos (INDIAGLYCO)

India Glycos Stock Details for Today: 

- Current Market Price: Rs. 763

- Stop Loss: Rs. 744

- Target 1: Rs.781

- Target 2: Rs. 809

- Holding Period: 1 week

5paisa Recommendation: Our technical experts expects further buying in the stock and recommends buying this stock.

 

4. Nazara Technologies (NAZARA)

Nazara Technologies Stock Details for Today: 

- Current Market Price: Rs. 2,264

- Stop Loss: Rs. 2,200

- Target 1: Rs. 2,335

- Target 2: Rs. 2,450

- Holding Period: 1 week

5paisa Recommendation: Positive chart structure in stock is observed by our technical experts and thus making this stock as one of the best stocks to buy today.

 

5. Indo Count (ICIL)

Indo Count Stock Details for Today: 

- Current Market Price: Rs. 299

- Stop Loss: Rs. 291

- Target 1: Rs. 308

- Target 1: Rs. 321

- Holding Period: 1 week

5paisa Recommendation: Our technical experts see a strong volume in the stock hence making this stock best stock to buy.

 

Share Market Today

SGX NIFTY: 

SGX Nifty indicates positive opening for Indian markets. SGX Nifty is at 17,939.80 levels, higher 77.75 points. (Updated at 7:45 AM).

International Markets:

US Market:

US markets ended mixed as Dow Jones closed higher by 70 points while Nasdaq closed lower by 77 as bond yields rose to 4-month highs.

US 10-year yield hits 1.48% which prompts profit booking in technology stocks while banks see buying. The oil acts as a catalyst for higher yields as WTI hits 2-year highs with the inflation threat now a reality.

 

Asian Market:

Asian markets opened in the red led lower by the Japanese 'Nikkei' which was down 200 points in early trade.

Near-term profit booking could be the order for this week and beyond as markets react to higher crude, inflation, and equities at an all-time high.

Chinese stocks may be underperformers as money flows see institutional exit and entry into other Asian markets.

 

Disclaimer: The above report is compiled from information available on the public platforms.

Next Article

BTST Trading Tips for Today: 28th September, 2021

BTST Trading Tips for Today: 28th September, 2021
by 5paisa Research Team 27/09/2021

5paisa analysts bring the best intraday ideas, short-term ideas and long-term ideas for you. In the morning we provide best momentum stocks to buy today, while in the last trading hour we provide Buy Today Sell Tomorrow (BTST) and Sell Today Buy Tomorrow (STBT) ideas.

BTST Trading Ideas for Today

1. BTST : FINPIPE 

- Current Market Price: Rs.208

- Stop Loss: Rs.205

- Target: Rs.214

 

2. BTST : DRREDDY SEP FUT

- Current Market Price: Rs.4,808

- Stop Loss: Rs.4,787

- Target: Rs.4,865

 

3. BTST : STOVECRAFT

- Current Market Price: Rs.1,034

- Stop Loss: Rs.1,015

- Target: Rs.1,095

 

4. BTST : CONFIPET

- Current Market Price: Rs.83

- Stop Loss: Rs.81

- Target: Rs.88

 

5. BTST : JBCHEMPHARM

- Current Market Price: Rs.1,922

- Stop Loss: Rs.1900

- Target: Rs.1978