This 19 year old business entity is one of the largest debt syndicators in the country. In the recently closed Debt offering of REC, they raised Rs 750 crore as lead managers. Operating from 10 offices across India, the corporate has built up a huge clientele of cash rich corporate entities and HNIs. With more offerings coming in the next 6 months from HUDCO, IIFL, PFC, Muthoot, Manappuram, Nabard, NHAI, ILFS Transportation the second half of FY14 should turn out to be exceptionally strong.
FY13 Revenues were placed at Rs 190 crore on a consolidated level and after tax profits of Rs 46 crore. This resulted into an EPS of Rs 70 per share and the corporate maintained dividend at Rs 6 per share.
60 per cent of the Equity is held by the promoters, and just 55 shareholders own 87 per cent of the company. The corporate has moved into Wealth management, stock broking and NBFC operations through the setting up of 4 WOS.
At CMP of Rs 116, the stock quotes at a PE of 1.2 and a PBV of 0.24. This valuation is substantially lower than even the worst PSU Banks and the stock can easily move up 50 per cent from here by March 2014.
The Reserve Bank should give preference to the non-corporate sector for new bank licences, Prime Minister’s Economic Advisory Council ChairmanC Rangarajan said.
“It is possible for the Reserve Bank to start with initially non-corporate business and find out whether there are suitable applicants and thereafter proceed to look at the other applicants,” he said in an interview.
The RBI is in the process of finalising the guidelines for giving new bank licences after Parliament approved Banking Laws (Amendment) Bill last month.
The central bank, Rangarajan said, “should look at various types of financial institutions that are available currently and decide”.
“…. many of the strong private sector banks today have been at one time or other in the financial system. They can look at it first and look at the other later on,” he said. Read More