|
Quantamental
Equity Research on BANDHAN BANK LTD | Release: 20 Jan 2020 17:19:33 UTC+05:30
| Reporting Currency: INR | Trading Currency: INR | Exchange:NSE/BSE NSE
CODE:BANDHANBNK and BSE CODE:541153 |
| Last Close: |
INR 475.85 |
| Fair Value: |
INR 453.95 |
| Est. Price by Mar 20: |
INR 602.7 |
| Market Capitalization (INR
Crs): |
76615.44 |
| Industry: |
Banks |
| Rating: |
STRONG BUY |
| Upside: |
27% |
| Company Profile |
|
| Bandhan Bank is focussed on serving the unbanked and
underbanked population of India. It offers world-class banking solutions and
financial services in the form of asset and liability products and services.
It offers regular banking services, microfinance, MSME, and affordable
housing finance to urban, semi-urban and rural customers.(Source : 201903
Annual Report Page No: 4) |
| Compounded Annual Growth |
|
|
|
|
|
|
|
|
|
|
|
| Particulars |
1-Year |
3-Year |
5-Year |
10-Year |
|
|
|
|
|
|
|
|
|
|
| Revenue % |
38% |
0% |
0% |
0% |
|
|
|
|
|
|
|
|
|
|
| EBIT % |
35% |
0% |
0% |
0% |
|
|
|
|
|
|
|
|
|
|
| Earnings % |
45% |
0% |
0% |
0% |
|
|
|
|
|
|
|
|
|
|
| Book Value
% |
19% |
0% |
0% |
0% |
|
|
|
|
|
|
|
|
|
|
| Stock Total
Return % |
12% |
0% |
0% |
0% |
|
|
|
|
|
|
|
|
|
|
|
| Share holding
pattern |
| Particulars |
%age |
|
| (A) Promoter
& Promoter Group |
82.26 |
|
| (B) FII/FPI |
6.91 |
|
| (C)
DII/Insurance Companies |
8.84 |
|
| (D) Public holding < 2 lakhs of cap. |
1.19 |
|
| (E) Others |
0.80 |
|
| Grand Total |
100.00 |
|
|
| Fundamentals
(Historical and Estimated) |
| Particulars |
|
|
|
|
|
|
Mar-17 |
Mar-18 |
Mar-19 |
Mar-20 E |
Mar-21 E |
Mar-22 E |
Mar-23 E |
Mar-24 E |
| Price |
|
|
|
|
|
|
|
469 |
526 |
603 |
902 |
1199 |
1398 |
1405 |
| Return on
Equity |
|
|
|
|
|
|
25% |
14% |
17% |
32% |
34% |
33% |
29% |
23% |
| Price to
Earning |
|
|
|
|
|
|
|
41.6 |
32.2 |
19.6 |
19.6 |
19.6 |
19.6 |
19.6 |
| EVTI |
|
|
|
|
|
|
|
14.8 |
12.5 |
12.1 |
12.1 |
11.9 |
11.5 |
11.0 |
| EVTIFM |
|
|
|
|
|
|
|
41.6 |
32.2 |
19.6 |
19.6 |
19.6 |
19.6 |
19.6 |
| Price to Book
Value |
|
|
|
|
|
|
|
6.0 |
5.6 |
6.3 |
6.7 |
6.4 |
5.6 |
4.5 |
| Debt to
Equity |
|
|
|
|
|
|
5.5 |
3.6 |
3.9 |
4.5 |
4.7 |
4.4 |
3.9 |
3.1 |
| Dividend Yield |
|
|
|
|
|
|
|
0% |
1% |
1% |
1% |
1% |
1% |
1% |
| Cash Flow to
Firm |
|
|
|
|
|
|
-105% |
-9% |
-4% |
-13% |
-11% |
-7% |
-2% |
4% |
|
| Detailed Estimates |
| Title |
Mar-19 |
Mar-20 E |
Mar-21 E |
Mar-22 E |
Mar-23 E |
Mar-24 E |
|
| Sales |
6,644.05 |
11,101.40 |
16,825.94 |
22,890.68 |
27,588.30 |
28,967.71 |
|
| EBITDA |
5,239.17 |
8,884.58 |
13,465.99 |
18,319.67 |
22,079.22 |
23,183.18 |
|
| EBIT |
5,161.00 |
8,753.96 |
13,299.26 |
18,132.71 |
21,898.61 |
23,036.73 |
|
| PBT |
3,013.05 |
6,606.01 |
9,886.12 |
13,142.03 |
15,324.02 |
15,400.75 |
|
| NPAT |
1,951.50 |
4,954.51 |
7,414.59 |
9,856.52 |
11,493.02 |
11,550.56 |
|
| Price to
Earning |
32.17 |
19.58 |
19.58 |
19.58 |
19.58 |
19.58 |
|
| Price to Book
Value |
5.61 |
6.29 |
6.67 |
6.39 |
5.63 |
4.54 |
|
| Debt to
Equity |
3.91 |
4.50 |
4.67 |
4.44 |
3.89 |
3.10 |
|
| Return on
Equity |
0.17 |
0.32 |
0.34 |
0.33 |
0.29 |
0.23 |
|
| Enterprise Value to Total Income (EVTI) |
12.52 |
12.13 |
12.10 |
11.90 |
11.55 |
11.00 |
|
| Enterprise Value to Total Income to Firm Margin(EVTIFM) |
42.33 |
32.87 |
32.73 |
32.13 |
31.11 |
29.60 |
|
| Price or Est.
Share Prices |
526.25 |
602.70 |
902.00 |
1,199.10 |
1,398.20 |
1,405.25 |
|
|
| DISCOUNTED CASH
FLOW |
| Title |
Mar-20 E |
Mar-21 E |
Mar-22 E |
Mar-23 E |
Mar-24 E |
|
| PBT |
6,606.01 |
9,886.12 |
13,142.03 |
15,324.02 |
15,400.75 |
|
| Interest |
2,147.95 |
3,413.14 |
4,990.68 |
6,574.59 |
7,635.99 |
|
| Depreciation |
130.61 |
166.73 |
186.95 |
180.61 |
146.45 |
|
| Cash Flow
Before Tax |
8,884.58 |
13,465.99 |
18,319.67 |
22,079.22 |
23,183.18 |
|
| Tax Rate |
25.00 |
25.00 |
25.00 |
25.00 |
25.00 |
|
| Cash Flow
After Tax |
6,663.43 |
10,099.49 |
13,739.75 |
16,559.42 |
17,387.39 |
|
| Terminal Cash
Flow |
- |
1,89,492.77 |
|
| Total Cash
Flow |
6,663.43 |
10,099.49 |
13,739.75 |
16,559.42 |
2,06,880.16 |
|
| Present Value of
Cash Flow (Mar-20 E) |
1,42,607.98 |
|
| Debt (Mar-20 E) |
69,524.48 |
|
| Value of Equity
(Mar-20 E) |
73,083.50 |
|
| Fair Value Per
Share (Mar-20 E) |
453.95 |
|
|
| Equity |
|
|
|
|
76,615 |
|
| Debt |
|
|
|
|
43,753 |
|
|
| Beta |
Take from Reuters |
|
|
2.25 |
|
|
|
|
|
|
|
|
|
| Risk Free Rate |
Prevailing Yield in India |
|
|
7% |
|
|
|
|
|
|
|
|
|
| Market Risk Premium |
Assuming 8.82% premium
for Equity Investments |
7% |
|
|
|
|
|
|
|
|
|
|
| Interest Paid |
|
|
|
|
2,148 |
|
| Tax Benefit |
|
|
|
|
757 |
|
| Interest Net of Tax |
|
|
|
|
1,391 |
|
| Debt |
|
|
|
|
43,753 |
|
| Cost of Debt |
|
|
|
|
3% |
|
| Cost of Equity |
|
|
|
|
24% |
|
| Debt Weight |
|
|
|
|
36% |
|
| Equity Weight |
|
|
|
|
64% |
|
| WACC |
|
|
|
|
16% |
|
|
| Cash Flow of Mar-24 E |
|
|
|
|
17,387.39 |
|
| Growth |
|
|
|
|
5.0% |
|
| Present Value of Terminal
Cashflow |
|
|
|
|
1,89,492.77 |
|
|
| Peer Comparision |
| # |
Name |
CMP
Rs. |
Mar
Cap Rs.Cr. |
Debt
Rs.Cr. |
Cost
of Equity % |
Kd
before tax % |
WACC
% |
Beta |
P/E |
Ann.
ROE % |
CMP
/ BV |
PE/ROE |
PE/ROE/G |
|
|
| 1 |
HDFC Bank |
1,287.65 |
7,05,249 |
########## |
19.88 |
5.79 |
10.10 |
0.90 |
28.77 |
21.76 |
4.59 |
1.32 |
5.35 |
|
|
| 2 |
ICICI Bank |
537.15 |
3,47,521 |
8,91,641.06 |
8.73 |
3.83 |
2.92 |
-0.02 |
51.95 |
4.90 |
3.04 |
10.60 |
-174.03 |
|
|
| 3 |
Kotak Mah. Bank |
1,701.55 |
3,25,172 |
2,91,263.20 |
20.93 |
5.96 |
12.96 |
1.10 |
41.61 |
21.14 |
5.58 |
1.97 |
6.43 |
|
|
| 4 |
Axis Bank |
737.30 |
2,07,904 |
7,11,995.77 |
15.10 |
5.59 |
4.84 |
-0.25 |
44.43 |
-0.15 |
3.07 |
-291.06 |
284.07 |
|
|
| 5 |
IndusInd Bank |
1,386.45 |
96,091 |
2,42,189.03 |
26.69 |
7.56 |
11.08 |
1.44 |
21.47 |
24.66 |
3.60 |
0.87 |
2.72 |
|
|
| 6 |
Bandhan Bank |
475.85 |
76,615 |
43,752.97 |
34.69 |
10.19 |
24.31 |
2.25 |
24.27 |
31.47 |
6.84 |
0.77 |
0.64 |
|
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