SmartInvestor

Tata Capital and Bajaj Finance - Brief comparison

Comparing Tata Capital and Bajaj Finance - Who is the best ?

Here is a comparative analysis of Tata Capital and Bajaj Finance focusing on profitability ratios, performance, and future outlook from an equity research perspective.

Tata Capital's profitability ratios like ROE and ROA are notably lower than Bajaj Finance's.
Bajaj Finance demonstrates strong operating and net profit margins, as well as significantly higher EPS, reflecting superior profitability and operational efficiency. Tata Capital's margins have been under pressure due to an expanded loan book leading to higher provisions and costs

Performance Overview
- Tata Capital reported a sharp income growth of 55.9% in FY25 but only modest net profit growth of 9.9%, indicating margin compression due to increased expenses and provisions.
- Bajaj Finance maintains robust profit growth with a historical CAGR of ~35% and projected profit growth CAGR of 23-24% long term. Its business model shows consistent strong earnings quality and capital efficiency

Future Outlook
- Tata Capital aims for aggressive loan book growth, leveraging technology and diversification. The recent IPO capital infusion is expected to reduce funding costs and improve return ratios, targeting to close the gap with peers gradually. The focus is on cost-to-income improvement using AI and maintaining credit quality
- Bajaj Finance is considered a safer, long-term investment with steady growth in earnings and revenue forecasted at around 18-25% annually. It is expected to maintain its leadership in NBFC profitability metrics and shareholder value creation

From an equity research viewpoint, Tata Capital offers a tactical growth opportunity driven by expansion and technology, while Bajaj Finance remains a safer, high-profitability choice with consistent returns

This comparative analysis provides a nuanced view of both companies' profitability, performance, and outlook to guide investment decisions.

Tata Capital Projections

Current standalone ROE is about 14.2%, with the overall ROE around 12.6% after consolidation effects.Tata Capital's PAT grew at around 10% CAGR recently, and with the recent IPO capital infusion, ROE is expected to gradually improve towards peer averages of around 16% in the medium term.The company plans aggressive loan book and revenue growth, supported by capital augmentation, cost efficiencies through technology, and controlled asset quality which should drive PAT growth in the mid-teens (about 12-15%) annually for the next 3 years.

Bajaj Finance is forecasted to maintain a high ROE around 20.9% in 3 years, consistent with its historical range of 19%-23%.Analysts expect Bajaj Finance to achieve PAT growth of approximately 18.3% per annum over the next 3 years, driven by continued revenue growth (about 25.2% CAGR) and operational efficiencies.

EPS growth is also strong, projected around 21.9% per annum.Despite some expected moderation in ROA from about 5.1% to 4.6-4.8%, the company’s large scale and asset growth will sustain superior performance.

Retail Investors should apply for the upcoming Tata Capital IPO and they have higher chances for allotment as 35% of the issue is reserved under this category.

2 months ago | [YT] | 0

SmartInvestor

Salasar Techno Engineering’s Q1 FY26 results show a moderate year-over-year revenue growth but a sharp decline in profitability and margins compared to the previous quarter, indicating challenges with cost management and segment pressures

Financial Highlights

- Total income for Q1 FY26 was ₹301.81 crore, up 2.3% YoY from ₹294.90 crore but down 18.3% QoQ from ₹369.54 crore

- Net profit fell to ₹8.79 crore, a 48.2% QoQ decline from ₹16.97 crore and a 16.2% YoY decline from ₹10.49 crore

- Expenses were ₹290.03 crore, up 3.3% YoY but decreased 16.3% QoQ

- EPS remained flat at ₹0.10, indicating little value accruing per share over the prior periods

Segment & Operational Analysis

- Steel structures contributed ₹170.35 crore in revenue while EPC projects added ₹138.94 crore, suggesting balanced revenue drivers

- EBIT margin for the quarter was around 8.4%, with net profit margin notably lower at about 2.82%, reflecting acute pressure on bottom-line metrics despite stable topline

- Cost increases and lower operational leverage seem to have driven the decline in Q1 profits

Strategic & Corporate Developments

- The company is under ED investigation, which brings additional uncertainty and could have implications for its governance and investor confidence

- There were updates on preferential issue utilizations and statutory/secretarial auditor appointments

- No significant major project wins or capacity expansions were highlighted for the quarter.

Outlook

- The flat EPS and profit declines indicate challenges in extracting higher value from increased revenue, likely due to higher input costs or subdued execution margin.

- Sector fundamentals, including telecom and infrastructure orders, remain core drivers, but company-level execution efficiency needs to improve to restore prior margin performance

Salasar Techno Engineering remains a stable revenue generator in its core segments, but its Q1 FY26 results reflect margin, profit, and cost management challenges that will require strategic focus in coming quarters.

Salasar Techno Engineering is aggressively expanding capacity and diversifying operations through strategic investments, new manufacturing projects, and international ventures, positioning for robust growth and improved prospects by 2027

Capacity Additions (2025-2027)

- The company operates three manufacturing units in Hapur, Uttar Pradesh, with a total installed capacity of 1,96,000 MT, and recent updates mention an enhancement exceeding 2,11,000 MT per annum for fabrication and galvanization

- A state-of-the-art galvanization plant, reportedly Asia’s largest, was commissioned, projected to add at least ₹50 crore in revenue annually and to significantly boost export potential

- The acquisition of EMC Limited brought in new capacity and assets, strengthening Salasar’s ability to bid for high-voltage EPC power transmission and substation projects, particularly in 765 kV segment, with turnkey project execution capabilities in India and overseas (e.g., a major ongoing project in Tanzania)

- Additional working capital and internal accruals are being earmarked for further expansions and automation initiatives up to 2027

Strategic Initiatives and Growth Drivers

- Key revenue drivers include the government’s infrastructure push, 5G rollout, railway and rural electrification, and international expansion into Southeast Asia and Africa

- The diversification into solar power, undersea cable networks, and modular construction is expected to open new business lines by 2027

- Operational efficiencies—automation and process improvements—are targeted to reduce costs by 10-12%, directly supporting future margin enhancement

- Export orders remain healthy, with robust order visibility in Nepal, Africa, and South Africa, and no plans for significant equity dilution

Future Prospects for 2027

- The outlook for 2027 is positive, supported by continued government spending on infrastructure, the National Infrastructure Pipeline, and a large, diversified domestic and export order book

- Share price targets for 2027 are optimistic, with projections ranging from ₹47 to ₹74, reflecting sustained growth, business diversification, and margin improvement potential amid sector tailwinds, though sector and macro risks persist

- Financial performance is expected to benefit from lower debt levels, stable order inflows, and improved ESG compliance, attracting greater institutional participation

- The company is positioned as a key beneficiary of India’s infrastructure growth and the global movement towards sustainable and digital infrastructure

Salasar Techno’s ongoing capacity expansion and diversification, underpinned by strong sector and policy momentum, signal strong future prospects and value creation potential going into 27

2 months ago | [YT] | 2

SmartInvestor

#KalyanJewellers

The valuations are very high and is likely < 500 if market weakness persists


Last one year the returns were spectacular and they are opening the showrooms at a faster pace


If you have a long term view must avail the deep cut in price and buy in small lots


YH 795 UL 322

11 months ago | [YT] | 2

SmartInvestor

Motilal Oswal reiterates its ‘Buy’ call on this coal company with a target price of Rs 430u pside of 9.5%. Co has made a long-term commitment through FSA agreements to meet the increasing demand in the power sector amid government push for reliable 24x7 electricity supply.”


They say that the company aims to increase production to 780 mt in FY24 and 850 mt in FY25.
CMP of 385 scrip had a YH of 396 and YL of 208
Returns -
1 month - 10% a jump of Rs.32
6 months - 64% a jump of Rs.150
12 months - 80% a jump of Rs.170
Extremely bullish

1 year ago | [YT] | 1

SmartInvestor

@SmartInvestor
#SmartInvestor #SmallCaps #PSU
#PSUstocks
Congrats investors for making it to 200+ Club for #BHEL
Fantastic returns in 2023
Started the upward journey at Rs.80 on 2 Jan 23
CMP 199 - 29 Dec 2023 a 148% return jump of 119 during year
LT investors continue to hold

2 years ago | [YT] | 1

SmartInvestor

@smartinvestor
#SmartInvestor #PNB #BREAKOUTSTOCKS #YearHigh #52WeeksHigh
What a rally it has been for #PNB
A growth of 76% growth of Rs.42
Last 6 months has been the best though a whopping growth of 90% jump of Rs.46. Previous 6M it did nothing
Looking set for a 125 soon

Skip the Carousel

1 2

2 years ago | [YT] | 1

SmartInvestor

IDBI Bank announced its Q2 2023-24 financial results, with the positivity of sustained healthy financials and strength in the overall operations of the company. On the path of a robust operating momentum, the bank is poised, as of Q2, to go further ahead on its growth journey.



Notable Highlights
Some of the key metrics shedding light on the general performance of the bank in Q2 are mentioned below:

In terms of profitability, the PAT for Q2 was at ₹1,323 crore, showing an uptick of 8% QoQ and 60% YoY. PBT is at the position of ₹2,299 crore, up by 26% QoQ, and a rise of 60% YoY.


Profit is also reflected in the bank’s Q2 Operating Profit at ₹2,072 crore, NII at ₹3,067 crore (up by 12% YoY, NIM at 4.33%, and Cost to Net Income Ratio or CIR standing at 47.63%.


With regard to IDBI Bank’s performance, business-wise, there was a focus on granularity. The CASA stands at ₹128464 crore, the percent of CASA being 51.49%.


Further, on the retail side, Corporate advances (Gross Advances) were at a ratio of 70:30 in Q2 FY 23-24, relative to 65:35 in Q2 FY 22-23. Net Advances were placed at ₹168502, with a corresponding growth of 2% QoQ, and 15% YoY.
Significantly, Q2 experienced an improving trend in asset quality with a Net NPA at 0.39%, a decrease of 5 bps QoQ and 77 bps YoY. The GNPA was 4.90%, reduced by 15 bps QoQ and 1161 bps YoY.


The bank showed adequate capitalisation in Q2 with Tier 1 capital up by 93 bps QoQ and 181 bps YoY, with capitalisation itself at 18.86%. The total CRAR stood at 21.26%, reflecting a rise of 93 bps QoQ and 178 bps YoY.


This post is for education purpose only. For investment decisions please consult your Financial Advisor.



Date 19 Dec 2023



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2 years ago (edited) | [YT] | 1

SmartInvestor

Plastic Pipes Channel Check



Sector: Building Materials




December 17, 2023




Industry should continue to register healthy volume growth! We interacted with multiple dealers from north & west region, and regional manufacturers of plastic pipe industry to understand the on-going trends in terms of demand, polymer prices and outlook going ahead.


Following are the key highlights:

 Q3 is a seasonally weak quarter, owing to festive & marriage season. However overall demand has been sturdy, both agri and plumbing segment have been witnessing healthy demand.

 Spends in Jal Jeevan Mission continues to remain robust leading to strong demand for both Agri & Plumbing.

 Plumbing demand is also continuing its northwards march. Barring the seasonality impact, volume off-take has been growing on m/m basis for manufacturers.

 Plastic pipes are finding newer applications in infrastructure segment, leading manufacturers are launching new innovative products which should bode well for industry growth.

 The quarter commenced with sharp decline in PVC resin prices, however, there has been a steady uptick in prices since then. Hence, manufacturers do not expect any major inventory losses.

 New domestic capacity of PVC reins is likely to get operational by FY26. The current difference between domestic & import prices is ~Rs2/Kg.  CPVC resin prices are largely steady. Domestic capacities are coming-up, however the quantum is not enough & hence industry will continue to rely on imports.

 Dealers have commenced re-stocking post the sharp fall in resin prices, in anticipation of improvement in price hikes. Moreover, channel inventory is at normal level, for agri division the dealers hold inventory of ~10-12days while the same for plumbing is ~20-25days.

 The consensus view from our interactions is that the demand for plastic pipes will continue to grow for next 3-5years as the spends in irrigation & uptick in new construction is likely to expand.



We continue to remain positive on plastic pipe industry on account of healthy industry tailwinds lead by strong plumbing & agri demand backed by robust spends in Jal Jeevan Mission. Incrementally, with higher demand for branded products, organized players are likely to outperform industry growth.



Investors should track Q3 FY 24 results before buying.

PVC resin prices likely to remain range-bound, manufacturer’s margins are expected to remain steady. Hence, we reckon that plastic pipe industry will continue to deliver healthy growth in next 3- 5years. We prefer Apollo Pipes Ltd & Prince Pipes & Fittings Ltd from this segment.

Comparative Performance of Apollo and Prince Pipes.



This video is for education purpose only. For investment decisions please consult your Financial Advisor.



Date 17 Dec 2023



This post is bought to you by Smart Investors - Indias Most Knowledgeable Equity Researchers.



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2 years ago | [YT] | 1

SmartInvestor

𝐎𝐫𝐝𝐞𝐫 𝐁𝐨𝐨𝐤 𝐢𝐬 𝐇𝐢𝐠𝐡𝐞𝐫 𝐭𝐡𝐚𝐧 𝐌𝐚𝐫𝐤𝐞𝐭 𝐂𝐚𝐩!👇

1- 𝗡𝗕𝗖𝗖 - CMP (81)
Market Cap - 14600 Crore
Order book - 45000 Crore



2- 𝗥𝗩𝗡𝗟 - CMP (171)
Market Cap - 35466 Crore
Order book - 52000 Crore


3- 𝗜𝗥𝗖𝗢𝗡 - CMP (160)
Market Cap - 15119 Crore
Order Book - 32000 Crore


4- 𝗡𝗖𝗖 - CMP (174)
Market Cap - 10970 Crore
Order book -50000 Crore


5- 𝗣𝗡𝗖 𝗜𝗻𝗳𝗿𝗮𝘁𝗲𝗰𝗵 - CMP (339)
Market Cap - 8900 Crore
Order book - 19000 Crore

WE are holding all these shares and expecting the outlook for next 2-3 years to be quite bullish.

This post is bought to you by Smart Investors - Indias Most Knowledgeable Equity Researchers.

For more informative videos
Like, Share and Comment on Vidoes.
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Youtube Channel - youtube.com/@Smart_Investor1
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Blogs - ingeniousinvestor.blogspot.com/
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2 years ago | [YT] | 2

SmartInvestor

@smartinvestor #SmartInvestor
#smallcap #multibaggers #MomentumStocks
#MomentumScrips

Here is a list of 19 SmallCap shares which had excellent Q2 and First Half of 2023-24 financials.
Buy on dips to add to your portfolio.
There is lot of momentum still left in these.

2 years ago | [YT] | 1