RESULTUPDATE

REPCOHOMEFINANCE
Assetqualityimproves;tepidrevenuesuppresses earnings
IndiaEquityResearch|BankingandFinancialServices

Repco Home Finances (RHF) Q3FY15 PAT of INR307mn was in line with
our estimate as betterthanexpected asset quality was offset by lower
revenue traction. Key highlight was GNPLs rising mere 34bps to 1.99%
(comparedtohistorical trend of80120bpsQoQ riseinQ3)feedinginto
lowerthanexpected credit cost of 19bps versus 5080bps in Q3
historically. Disbursements were muted at INR4.7bn (up mere 7% YoY)
resulting in sub30% loan growth (at 27% YoY). However, management
expectsthemtoreverttonormallevels.Thepotentialtogrowmanifold
in an underserved market underpinned by sufficient CAR of 21.5% will
sustainRHFsloanCAGRof25%plusandhelpitpostimpressive24%plus
earnings CAGR, 2.5% RoA and 20% RoE. We maintain BUY and target
priceofINR770(on4.2xFY17EP/B).

ThisreportalsocontainsQ3FY15/Q2FY15concallhighlights

AbsoluteRating

BUY

RatingRelativetoSector

Outperformer

RiskRatingRelativetoSector

Medium

SectorRelativetoMarket

Overweight

MARKETDATA(R:RHFL.BO,B:REPCOIN)
CMP

:INR658

TargetPrice

:INR770

52weekrange(INR)

:725/301

Shareinissue(mn)

:62.4

Mcap(INRbn/USDmn)

:41/664

Avg.DailyVol.BSE/NSE(000) :219.3
SHAREHOLDINGPATTERN(%)

Slowerdisbursementsfeedintolowerthantrendloangrowth
Disbursements were moderate largely on lower draw downs from sanctions (up 19%
YoY)leadingtolowerdisbursement/sanctionsratioof90%versusrunrateofover95%
historically.ManagementhighlightedthatthetrendrectifiedinJanuaryanditexpects
normalised disbursements going forward. Given the vast opportunity landscape, we
expectittoreturntohealthygrowth.

Assetqualityspringsapositivesurprise
Underpinnedbytargetcustomersegments(nonsalaried),RHFsNPLprofileisseasonal
innaturewithusualspikeinQ1andQ3.However,thequantumofuptickisstructurally
fallingapparentacross34yearswithdipinquantumofriseinGNPLs.InQ3FY15,this
trendwasfurtherstrengthenedwithonly34bpsrise(versus5080bpsinearlieryears).
Whilecoverageisat42%,RHFexpectstoshoreitupto50%overnextcoupleofyears.

EDELWEISS4DRATINGS

Outlookandvaluations:SuperiorsustainableRoA;maintain'BUY'

Current

Q2FY15 Q1FY15

Promoters*

37.4

37.4

37.4

MF's,FI's&BKs

16.3

16.3

11.9

FII's

25.0

25.0

12.2

Others

21.4

21.4

38.5

*Promoterspledgedshares
(%ofshareinissue)

PRICEPERFORMANCE(%)
Stock

Nifty

1month

13.5

4.0

5.1

49.7

9.9

21.8

12months

117.4

36.6

78.1

+912240407579
kunal.shah@edelweissfin.com

YeartoMarch

NileshParikh

638 (0.3) 1,908

FY16E

2,392

3,025

327 (5.8) 1,101

1,285

1,653

112

131

155

17.6

20.6

26.5

+912266203076
prakhar.agarwal@edelweissfin.com

P/AdjBook(x)

6.1

5.2

4.4

DilutedP/E(x)

37.3

31.9

24.8

February4,2015

636

509 24.9

307

271 13.3

Q2FY15 Growth(%)

BVpershare
DilutedEPS

EdelweissResearchisalsoavailableonwww.edelresearch.com,
BloombergEDEL<GO>,ThomsonFirstCall,ReutersandFactset.

FY14

KunalShah

FY15E

NetInterstInc.
PAT

Growth(%)

EWBanksand
Financial
ServicesIndex

3months

RHF operates in a niche segment which is underserved by banks and larger housing
finance companies (HFCs). In this backdrop, we expect the company to be key
beneficiary of our optimistic stance on the mortgage finance sector, given emerging
opportunities and governments thrust on affordable housing and housing for all
initiatives(referournote,Makinginroadsinuncharteredterritory,datedJanuary12,
2015).Thestockistradingat3.6xFY17EP/ABV.WemaintainBUY/SO.
Financials

(INRmn)
Q3FY15 Q3FY14

NIL

+912240635470
nilesh.parikh@edelweissfin.com

PrakharAgarwal

EdelweissSecuritiesLimited

BankingandFinancialServices

NIMsstablederivingsupportfromimprovingyields
NIMs during the quarter were stable at 4.5% deriving benefit from 6bps QoQ inch up in
lending yields, which offset the impact of 5bps QoQ increase in funding cost. With the
proportion of nonsalaried segment further inching up to 55.9% (55.7% in Q2FY15 and
54.5% in Q3FY14) and LAP also rising to 19.3% (from 17.5% in Q3FY14), yields improved
6bpsQoQto12.76%.Ontheotherhand,costoffundshasincreased5bpsQoQ(to9.85%),
managementhighlightedthiswasbecauseofchangeintheNHBrequirement(cappingon
lending yield to 200bps) has led to the company shifting to higher cost borrowing from
banks,asaresultproportionofNHBfellfurtherto20%(from26%ayearago).Management
expectstodiversifytheborrowingprofileandexpectstotaplowercostfundingsources(viz.,
NCDs , CP etc) which along with lower bank funding rate (base rate may be pruned by
banks)willhelplowercost,inturnaidingNIMs.

Slowerrevenuegrowthweighsonprofitability
NII growth was below expectationsflat QoQled by modest disbursements feeding into
lowerthantrack loan growth (27% YoY) cushioned by stable NIMs. However, ample
opportunitybywayofexpansioninunderservedandunderpenetratedareasofTierIIand
III cities renders confidence that RHF will be able to return to healthy loan growth.
Additionally, optimal mix between nonsalaried and salaried segments and increased
contributionfromLAPproductswillfeedintostable/improvingmargins.Thesefactorswill
helpRHFposthealthyoperatingperformance.

Otherhighlights

WhilePATgrowthseemsopticallylowerat13%YoY,thevectordrivingthesamewas
creationofdeferredtaxliability,takingthetaxrateto34%comparedto26%ayearago
(PBTgrew27%YoY).

RaisedINR500mnviaCPsrecentlyat8.6%.Goingforward,managementexpectsfurther
INR500mnofCPissuanceandalsotapNCDsroute.

DisbursementduringthequarterinHLwasINR3.81bnandinLAPINR940mn.

Plotloansaccountfor5%ofloanbookwiththerequirementthatconstructionshould
beginwithin36months.

Table1:OptimalloanmixLAPIncreasedcontributionfromnonsalariedandLAP
Loancomposition(%)
Q214
Q314
Q414
Q115
Q215
Q315
NonSalaried
54.0 54.5 55.0 55.3 55.7 55.9
Salaried
46.0 45.5 45.0 44.7 44.3 44.1
Loanmix(%)
IndividualHomeLoans
83.7 82.5 81.3 80.8 80.5 80.7
LoansagainstProperty
16.3 17.5 18.7 19.2 19.5 19.3
Source:Company

Table2:IncreaseinGNPLinQ3FY15betterthanhistoricallyinQ3
Q214
Q314
Q414
Q115
GrossNPA
1.7 2.0 1.5 2.5
NetNPA
0.9 1.3 0.7 1.6
ProvisionCoverage
45.3 37.4 51.0 35.7

Q215
1.7
0.8
51.5

(%)
Q315
2.0
1.2
42.1

Source:Company

EdelweissSecuritiesLimited

RepcoHomeFinance

Table3:Marginsstablederivingsupportfromimprovingyields
(%)
Q214
Q314
Q414
Q115
Yield
12.6 12.6 12.6 12.6
CostofDebt
9.3 9.4 9.3 9.8
Spread
3.3 3.2 3.3 2.8
NIM
4.7 4.6 4.7 4.4

Q215
12.7
9.8
3.0
4.5

Q315
12.8
9.9
2.9
4.5

Source:Company

Table4:BorrowingmixLowerNHBdrawdownmadethetiltinfavourofbanks (%)
Q214
Q314
Q414
Q115
Q215
Q315
Banks
62.8 64.7 65.0 64.0 69.0 72.0
NationalHousingBank
30.0 26.0 25.0 26.0 22.0 20.0
RepcoBank
7.2 9.3 10.0 10.0 9.0 9.0
Source:Company

EdelweissSecuritiesLimited

BankingandFinancialServices

Financialsnapshot
YeartoMarch
InterestIncome
InterestExpenses
NetInterestIncome
OtherIncome
OperatingExpenses
Staffexpenses
OtherOpex
Provisions
Depreciation
PBT
Taxes
PAT
(INRmn)
Sanctions
Disbursements
Loanbook
AssetQuality(%)
GNPLs
NNPLs
ProvisionCoverage

Q3FY15
1756
1120
636
1
135
85
50
26
7
469
161
307

5,243
4,749
55,007

2.0
1.2
42.1

Q3FY14
1358
849
509
4
103
56
47
35
7
368
97
271

%change
29.3
31.9
24.9
30.6
51.7
5.3
(25.1)

27.3
66.6
13.3

4,412 18.8
4,436 7.1
43,194 27.3

2.0
1.3
37.4

Q2FY15
1692
1054
638
5
121
77
44
17
7
498
172
327

11.2
10.5
12.5
54.7
4.3
(5.9)
(5.9)
(5.8)

YTD15
5008
3150
1858
7
363
230
133
141
20
1341
459
882

5,589 (6.2)
5,412 (12.3)
52,380 5.0

15,643
14,307
55,007

1.7
0.8
51.5

%change
3.8
6.3
(0.3)

2.0
1.2
42.1

(INRmn)
FY16E
8,449
5,424
3,025
300
595
595
235
245
37
2,486
833
1,653

FY15E
6,631
4,239
2,392
244
505
505
200
198
31
1,932
647
1,285

21,870
20,669
59,413

26,244
25,009
74,323

1.6
0.8
52.0

1.7
0.8
53.0

EdelweissSecuritiesLimited

RepcoHomeFinance

Q3FY15earningsconcalltakeaways

Withrespecttogrowthmetrics
Disbursementduringthequarterwerelowerfollowing1)lowerdrawdownsfromthe
sanctions pool (large part of the sanctions happened in last week of December
correspondingtowhichdisbursementhasnothappened)and2)higherbase.However,
goingintoJanuarythedisbursementshasnormalizedandmanagementexpectstotrack
normalizedgrowthinQ4FY15(20%disbursementgrowthpossible).

LAPbooktobemaintainedataroundcurrentlevels(~20%),havecomfortableLTVof
50%inthissegment.GNPLinLAPis2.9%(normalizedcreditcostis~50bps)

Intermsofgrowthfromnonsouthernmarket:Maharashtraisdoingwell,howeverMP,
Orissaarecontributingtothegrowth,howeverthecontributionisnotverysignificant
ascompanyhasnotbeenveryaggressiveascurrentlytheyareintheevaluationmode.

Slowdown has been happening in the major cities in South such as Chennai, Cochin,
Trichy etc. However as the company has 2/3rd of the business comes from other
citiessocompanyisconfidentofmaintainthegrowthrate.

Loanbookgrowthtobemaintainedwithin2530%overmediumtolongerterm.

WithrespecttoNIMs
Aimstomaintainofspreadof3%plusandNIMsof4%plus.

Raised INR500mnthroughCPsrecentlyat 8.6%.Goingforwardmanagementexpect

furtherINR500mnofCPissuanceduringthequarterandalsotapNCDsrouteduring
thequarter.

CostoffundshasincreasedowingtochangeinNHBrequirement(cappingonlending
yieldto200bps)hasmadecompanytoshifttohighercostborrowingfromthebanks.

Otherhighlights
Planstoexpandthebranchnetworkby15branches/year,with1/3rdinnonsouthern
regionand2/3rdinsouthernregion.

Cost/income ratio was at 20% (including ESOPs) and 18% ( excluding ESOPs).
Managemntexpectstotracebackcosttoincomeratioof18%(includingESOPs).

In terms of geographical presence: part of the GNPLs were coming from Kerela and
TehelganaandincrementallyinOrissaandWestBengal.

Datapoints
DisbursementduringthequarterinHLwereINR3.81bnandinLAPINR940mn

IncrementalticketsizeinhomeloanINR1.43mn,Homeequity:INR2.3mn.Intermsof
salariedincrementalticketsizeisINR1.16mn,andnonsalaried:INR1.98mn.

Employees:534

AvgticketsizeINR1.2mn.

Yieldsintheretailhomeloan:12.1%,LAPat15.9%

6%istheprepaymentratenoincreasedwitnessedoverpast9months.

Plot loans account for 5% of the loan book with the requirement that construction
shouldbeginwithin36months.

EdelweissSecuritiesLimited

BankingandFinancialServices

Q2FY15earningsconcalltakeaways
RepcoHomeFinancereportedPATofINR327mninQ2FY15(growthof12%YoY/32%QoQ)
betterthanourexpectationofINR310mn.Beatwasnotonlyduetolowercreditcostbut
alsoledbyhigherNII.Netinterestincomegrew21%YoY/9%QoQtoINR638mnandloan
lossprovisioningwaslower7080%bothYoYaswellasQoQ.

Asset quality improved significantlywithGNPLscomingdownfrom2.49%inQ1FY15

to1.65%inQ2FY15.Ithasalsoimprovedprovisioningcoverageto51.5%.

GNPLsinhomeloan1.59%inQ2FY15(2.31%inQ1FY15)andinhomeequityof1.89%
(3.25%)

Addedmorestaffduringthequarterto490andannualpromotionhasstarted

Yieldinhomeloan12.1%andhomeequity15.9%similartolevelinQ2FY14.Uniform
interestratefollowedacrossthecountry.

Innewmarkets,growthmaynotbeashighasSouthernmarketsasittryingtoestablish
itsbrandintheseplace.

Outlook
Guidanceof3%spreadand4%NIM

Wouldwanttotakeprovisioningcoverageto70%byendofthisfiscal

Sustainableloangrowthofatleast25%

Will diversify borrowing profile and tap CP market definitely before the end of this
fiscal.Someinternalprocess

RoAat2.5%andRoEsexpectedtogoupduetogearingwillmovetopreIPOlevelover
themediumterm.

EdelweissSecuritiesLimited

RepcoHomeFinance

CompanyDescription
RepcoisahousingfinancecompanyregisteredwiththeNHBandheadquarteredinChennai,
Tamil Nadu. It is promoted by the Government of India owned The Repatriates
Cooperative Finance and Development Bank (Repco Bank) and was incorporated in April
2000.Keypointtohighlightisthatthepromoterisaregisteredcooperativesociety.

As of December 2014, RHF had 137 branches and satellite centres located in Tamil Nadu,
Karnataka, Andhra Pradesh, Kerala, Maharashtra, Odisha, West Bengal, Gujarat and the
UnionTerritoryofPuducherry.

Further, two thirds of its centres are located in Tier 2 and Tier 3 cities. The companys
marketingstrategyconsistsofadvertisingvialoancampsandwordofmouthreferralsfrom
existing customers. As a result, most of its customers are walkins and the company does
not use marketing intermediaries. Branches source loans and carry out the preliminary
checks on credit worthiness of the borrower, post which the application is sent to the
centralised processing unit for approval. Branches are also responsible for assistance in
documentation,disbursingloansandinmonitoringrepaymentsandcollections

InvestmentRationale
RepcoHomeFinance(Repco)hascreatedanicheforitself,servicingbothsalariedandself
employed category in TierII and TierIII a customer segment left underserved by large
housingfinancecompaniesandbanks.Welikethecompanyforitsdifferentiatedapproach,
strongriskmanagementpractisesandmostimportantlyforitsscalablebusinessmodeland
superiorandsustainablereturnratios.

KeyRisks

Slowdown in real estate sector: Repco is mainly present in 8 states. Currently, over
60% of its loan book is coming from Tamil Nadu alone. Any slowdown in real estate
sector,especiallyinTamilNaduwillhavenegativeimpactongrowthandearnings.

Regulatory risk: Repco is regulated by National Housing Bank (NHB), a whollyowned

subsidiary of the Reserve Bank of India (RBI). Adverse regulatory change will have
negativeimpactonthegrowthandprofitabilityofthecompany.

EdelweissSecuritiesLimited

BankingandFinancialServices

FinancialStatements
Incomestatement

Keyassumptions
YeartoMarch

FY14

FY15E

FY16E

FY17E
7.3

GDP(YoY%)

4.7

5.4

6.3

Inflation(Avg)

9.5

6.8

5.5

5.5

Reporate(exitrate)

8.0

7.8

6.8

6.3

USD/INR(Avg)

60.5

61.0

62.0

62.0

Creditgrowth(%)

FY14

FY15E

FY16E

FY17E

5,156
3,248

6,631
4,239

8,449
5,424

10,661
6,828

Netinterestincome

1,908

2,392

3,025

3,833

198

244

300

369

2,106

2,636

3,325

4,202

Operatingexpense

388

505

595

693

Employeeexp

211

274

323

376

24

31

37

43

153

200

235

274

1,718

2,131

2,731

3,509

227

198

245

356

1,491

1,932

2,486

3,153

Fee&forex income
Netrevenues

12.0

15.0

17.0

9.5

9.3

9.2

9.2

Wholesaleborrowingcost(%)

8.7

8.5

8.3

8.3

Depreciation/amortisation

Gsecyield(%)

7.6

7.5

7.4

7.4

Otheropex
Preprovisionprofit

Costoffunds
Spread

(INRmn)

YeartoMarch

14.0

Operatingmetricassumptions(%)

Interestincome
Interestexpended

Bank'sbaserate(%)

Yieldonadvances

0.1

0.1

0.1

0.1

12.5

12.5

12.6

12.8

9.3

9.5

9.5

9.5

Profitbeforetax

Provisions

3.2

3.0

3.1

3.2

Provisionfortax

390

647

833

1,056

Employeecostgrowth

49.3

30.2

17.7

16.6

ProfitAfterTax

1,101

1,285

1,653

2,097

Otheropexgrowth

76.7

30.2

17.7

16.6

ReportedProfit

1,101

1,285

1,653

2,097

Taxrate

26.2

33.5

33.5

33.5

BasicEPS(INR)

17.6

20.7

26.6

33.7

10.0

Sharesoutstanding(mn)

62

62

62

62
33.6

Dividendpayout

6.8

10.0

10.0

0.1

0.1

0.1

0.1

17.6

20.6

26.5

Disbursementgrowth

46.9

20.5

21.0

23.0

Dividendpershare(INR)

1.2

2.1

2.6

3.4

Repayment/prepaymentrate

15.5

15.5

15.5

15.5

Dividendpayout(%)

6.8

10.0

10.0

10.0

1.5

1.6

1.7

1.7

Balancesheetassumption(%)

GrossNPLs
NetNPLs
Provisioningcoverage

0.7

0.8

0.5

0.5

0.8
0.5

DilutedEPS(INR)

0.7

Growthratios(%)

0.6

YeartoMarch

FY14

FY15E

FY16E

FY17E

Revenues
NIIgrowth

50.1
51.7

25.1
25.3

26.2
26.5

26.4
26.7

Opexgrowth

59.7

30.2

17.7

16.6

PPPgrowth

48.1

24.0

28.2

28.5

145.6

(12.6)

23.6

45.3

37.6

16.7

28.6

26.9

Provisionsgrowth
Netprofit

Operatingratios

YeartoMarch

FY14

FY15E

FY16E

FY17E

Yieldonadvances
Netinterestmargins

12.5
4.6

12.5
4.6

12.6
4.6

12.8
4.6

Costoffunds

9.3

9.5

9.5

9.5

Spread

3.2

3.0

3.1

3.2

Costincome

18.4

19.2

17.9

16.5

Taxrate

26.2

33.5

33.5

33.5

EdelweissSecuritiesLimited

RepcoHomeFinance

Balancesheet

Ason31stMarch

FY14

FY15E

FY16E

FY17E

Equitycapital
Reserves&surplus

622
6,340

622
7,496

622
8,984

622
10,871

Netinterestincome/assets
Netrevenues/assets

Shareholdersfunds

(INRmn)

RoEdecomposition(%)

YeartoMarch

FY14

FY15E

FY16E

FY17E

4.6
5.1

4.6
5.0

4.6
5.0

4.6
5.1

6,962

8,118

9,606

11,493

Operatingexpense/assets

0.9

1.0

0.9

0.8

Shorttermdebt

11,575

14,933

18,861

23,566

Provisions/assets

0.5

0.4

0.4

0.4

Longtermdebt

27,445

35,407

44,721

55,878

Taxes/assets

0.9

1.2

1.3

1.3

TotalBorrowings

39,020

50,340

63,582

79,445

Totalcosts/assets

2.4

2.6

2.5

2.5

263

373

522

717

ROA

2.6

2.4

2.5

2.5

46,244

58,832

73,710

91,655

Equity/assets

16.0

14.4

13.4

12.8

50
124

50
81

50
81

50
81

ROAE(%)

16.5

17.0

18.7

19.9

Deferredtaxliability(net)
Sourcesoffunds
Totalnetfixedassets
Noncurrentinvestments
Cashandequivalents

153

250

312

388

46,811

59,413

74,323

92,449

66

107

134

166

47,030

59,770

74,768

93,004

Othercurrentliabilitiesand

960

1,069

1,189

1,479

Totalcurrentliabilities&

960

1,069

1,189

1,479

Loansandadvances
Otherassets
Totalcurrentassets(excash)

Valuationparameters

YeartoMarch

FY14

FY15E

FY16E

FY17E

DilutedEPS(INR)
YoYgrowth(%)

17.6
39.0

20.6
16.7

26.5
28.6

33.6
26.9

Bookvaluepershare(INR)

112.0

130.6

154.5

184.9

Adjustedbookvaluepershare

108.3

125.5

147.8

184.9

37.3

31.9

24.8

19.6

6.1
0.2

5.2
0.3

4.4
0.4

3.6
0.5

Netcurrentassets(excash)

46,070

58,700

73,579

91,525

DilutedPE(x)

Usesoffunds

46,244

58,832

73,710

91,655

Price/Adj.BV(x)
Dividendyield(%)

Peercomparisonvaluation

Marketcap

Name

DilutedPE(X)

Price/BV(X)

ROAE(%)

(USDmn)

FY15E

FY16E

FY15E

FY16E

FY15E

FY16E

664

31.9

24.8

5.0

4.3

17.0

18.7

31,363

32.8

28.2

6.8

6.1

21.7

22.8

3,721

16.3

13.9

2.9

2.5

19.3

19.5

296

11.2

8.9

1.3

1.2

12.3

13.9

2,406

18.7

11.8

2.6

2.2

14.7

20.4

468

10.8

9.3

1.1

1.0

10.2

11.1

MuthootFinance

1,350

12.3

10.1

1.6

1.5

14.5

15.4

PowerFinanceCorp

6,007

5.9

5.3

1.1

1.0

20.9

19.8

RelianceCapital

1,931

14.0

12.5

0.9

0.8

6.4

6.8

RuralElectrificationCorporation

5,289

5.8

5.1

1.3

1.1

24.6

23.0

ShriramCityUnionFinance

RepcoHomeFinance
HDFC
LICHousingFinance
MagmaFincorp
Mahindra&MahindraFinancialServices
ManappuramGeneralFinance

2,159

23.3

18.2

3.2

2.8

16.2

16.4

Median

14.0

11.8

1.3

1.2

16.2

18.7

AVERAGE

16.1

13.0

2.0

1.7

15.6

16.5

Source:Edelweissresearch

EdelweissSecuritiesLimited

BankingandFinancialServices

AdditionalData
DirectorsData
T.S.KrishnaMurthy
S.C.Panda
ThomasPaulDiamond
V.Nadanasabapathy

Chairman
Director
Director
Director

R.Varadarajan
B.Anand
G.R.Sundaravadivel
KKPathak

ManagingDirector
Director
Director
Director

AuditorsR.SubramanianandCompany
*asperlastannualreport

HoldingTop10
Perc.Holding
SmallcapWorldFund

6.48

Perc.Holding
CapitalResearchGlobalInvestor

6.48

TempletonAssetManagement

4.17

ParvestEquityIndia

3.13

IndiaCapitalFund

3.09

SBIFundsManagement

2.97

BirlaSunLifeAssetManagement

2.83

GranthamMayoVanOtterloo

2.70

NomuraAssetManagement

2.20

CreadorILLC

1.82

*asperlastavailabledata

BulkDeals
Data
29Oct2014
20Oct2014
15Apr2014
03Apr2014
03Apr2014
03Apr2014
03Apr2014
31Mar2014
31Mar2014
31Mar2014
31Mar2014

Acquired/Seller
CreadorILlc
CreadorILlc
IndiaCapitalManagementLtdA/CIndiaCapitalFundLtd
BlackRockIndiaEqFundMauritiusLtd
NorgesBankGovernmentPensionFundGlobal
TheMasterTrustBkOfJapanLtd.AsTrusteeOfBlackrkIndEq Fd
WcpHoldingIii
IciciPrudentialMutualFund
IciciPrudentialTaxPlan
JupiterPafInvestmentsLtd
WcpHoldingIii

B/S
Sell
Sell
Buy
Buy
Buy
Buy
Sell
Buy
Buy
Buy
Sell

QtyTraded
399434
325000
486000
546087
596857
353604
2728100
884250
399036
1200000
3464000

Price
470.07
470.05
377.50
325.76
325.76
325.76
325.04
325.00
325.00
325.00
325.02

*inlastoneyear

InsiderTrades
ReportingData
27Oct2014
22Aug2014
23Jul2014
07Apr2014

Acquired/Seller
CreadorI,LLC
FirstCarlyleGrowthVI
SmallcapWorldFundInc.
WCPHoldingsIII

B/S
Sell
Sell
Buy
Sell

QtyTraded
3105000.00
11027721.00
4040440.00
3464000.00

*inlastoneyear

10

EdelweissSecuritiesLimited

RATING&INTERPRETATION

Company

Absolute

Relative

Relative

reco

reco

risk

AllahabadBank

BUY

SP

AxisBank

BajajFinserv

BUY

SO

BankofBaroda

DevelopmentCreditBank

BUY

SO

DewanHousingFinance

FederalBank

BUY

SO

HDFC

HDFCBank

BUY

SO

IndiabullsHousingFinance

BUY

SO

IDFC

BUY

KarnatakaBank
LICHousingFinance

Company

Absolute

Relative

Relative

reco

reco

Risk

BUY

SO

HOLD

SP

BUY

SO

HOLD

SU

ICICIBank

BUY

SO

IndusIndBank

BUY

SO

SO

INGVysya

BUY

SO

BUY

SP

KotakMahindraBank

HOLD

SU

M
M

BUY

SO

MagmaFincorp

BUY

SO

HOLD

SU

Manappuram GeneralFinance

BUY

SP

MaxIndia

BUY

SO

MultiCommodityExchangeofIndia

UNDERREVIEW

None

None

MuthootFinance

BUY

SO

OrientalBankOfCommerce

BUY

SP

PowerFinanceCorp

BUY

SO

PunjabNationalBank

HOLD

SP

RelianceCapital

BUY

SP

Repco HomeFinance

BUY

SO

RuralElectrificationCorporation

BUY

SO

ShriramCityUnionFinance

BUY

SP

ShriramTransportFinance

BUY

SO

SouthIndianBank

BUY

SP

StateBankofIndia

BUY

SO

UnionBankOfIndia

BUY

SP

YesBank

BUY

SO

Mahindra&MahindraFinancialServices

ABSOLUTERATING
Ratings

Expected absolute returns over 12 months

Buy

More than 15%

Hold

Between 15% and - 5%

Reduce

Less than -5%

RELATIVERETURNSRATING
Ratings

Criteria

Sector Outperformer (SO)

Stock return > 1.25 x Sector return

Sector Performer (SP)

Stock return > 0.75 x Sector return

Stock return < 1.25 x Sector return

Sector Underperformer (SU)

Stock return < 0.75 x Sector return

Sector return is market cap weighted average return for the coverage universe
within the sector

RELATIVERISKRATING
Ratings

Criteria

Low (L)

Bottom 1/3rd percentile in the sector

Medium (M)

Middle 1/3rd percentile in the sector

High (H)

Top 1/3rd percentile in the sector

Risk ratings are based on Edelweiss risk model

SECTORRATING
Ratings

Criteria

Overweight (OW)

Sector return > 1.25 x Nifty return

Equalweight (EW)

Sector return > 0.75 x Nifty return

Underweight (UW)

Sector return < 0.75 x Nifty return

Sector return < 1.25 x Nifty return

11

EdelweissSecuritiesLimited

 BankingandFinancialServices

EdelweissSecuritiesLimited,EdelweissHouse,offC.S.T.Road,Kalina,Mumbai400098.
Board:(9122)40094400,Email:research@edelweissfin.com

Coveragegroup(s)ofstocksbyprimaryanalyst(s): BankingandFinancialServices
AllahabadBank,AxisBank,BajajFinserv,BankofBaroda,DevelopmentCreditBank,DewanHousingFinance,FederalBank,HDFC,HDFCBank,ICICIBank,
InfrastructureDevelopmentFinanceCoLtd,IndiabullsHousingFinance,IndusIndBank,KarnatakaBank,KotakMahindraBank,LICHousingFinance,Max
India,MultiCommodityExchangeofIndia,ManappuramGeneralFinance,MagmaFincorp,Mahindra&MahindraFinancialServices,MuthootFinance,
OrientalBankOfCommerce,PunjabNationalBank,PowerFinanceCorp,RelianceCapital,RuralElectrificationCorporation,RepcoHomeFinance,State
BankofIndia,ShriramCityUnionFinance,ShriramTransportFinance,SouthIndianBank,UnionBankOfIndia,INGVysya,YesBank

RecentResearch

Date
Company
Title
Price(INR) Recos
03Feb15
30Jan15

30Jan15

Punjab
Mountingstressedassetsrock
NationalBank theboat;ResultUpdate
Karnataka
Bank

Coreunderpressure;saleto
ARCsaidsassetquality;
ResultUpdate

Bankof Stresscreationraisesitshead,
Baroda
outlookcautious;
ResultUpdate

177

Hold

143

Buy

193

Hold

DistributionofRatings/MarketCap
RatingInterpretation

EdelweissResearchCoverageUniverse

Buy

Hold

RatingDistribution*
*1stocksunderreview

150

46

Total

10

207

Between10bnand50bn

<10bn

143

58

Rating

Expectedto

Buy

appreciatemorethan15%overa12monthperiod

Hold

appreciateupto15%overa12monthperiod

Reduce

depreciatemorethan5%overa12monthperiod

Oneyearpricechart

859
737
614
492
369

Feb15

Jan15

Dec14

Nov14

Oct14

Sep14

Aug14

Jul14

Jun14

May14

Apr14

Mar14

247

Feb14

MarketCap(INR)

>50bn

(INR)

Reduce

RepcoHomeFinance

12

EdelweissSecuritiesLimited

RepcoHomeFinance

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EdelweissSecuritiesLimited

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14

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