Investment Idea - Buy Max Financial Services Ltd
Valuation & View:
MAXLIFE continues to demonstrate resilient performance amid a challenging macro environment. Healthy product mix towards high margin segments and strong APE growth aided VNB growth. Strong push via the banca channel has aided premium growth, while the proprietary channel is showing healthy traction. We expect 22% CAGR in APE growth over FY21-23E, with VNB margin improving to 26.8% by FY23E. This would enable 26% VNB CAGR over FY21-23E, while operating RoEV sustains ~22%. We maintain our Buy rating with a TP of INR1,200/share.
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SEBI Registration number is INH000000412
Long Term Recommendation:
Investment Idea : Buy Ashok Leyland Ltd
Valuation and view:
AL remains a pure-play on the CV cycle recovery. Unlike the previous cycles, it is on a strong footing (lean cost structure and reasonable debt) and is focused on adding new revenue/profit pools. AL’s revenue/EBITDA/PAT is estimated to post a 23%/44%/78% CAGR over FY20–23E on a low base of FY20. Valuations of 19.5x/10.4x FY22E/FY23E EV/EBITDA are at an early recovery cycle. We maintain Buy, with TP of INR156/share (12.8x FY23E EV/EBITDA).
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