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Jio Financial Services Ltd, which began as Reliance Strategic Investments in 1999, is now an independent financial holding company in India. Registered as a it functions as an umbrella company for its consumer-facing subsidiaries. Jio Financial Services also has a joint venture, Jio Payments Bank Limited, which offers savings accounts and bill payment services. In FY24, the company performed exceptionally well financially, with all key metrics registering significant growth. The company’s market capitalisation stands at a strong ₹2.20 lakh crore. Its net sales surged an impressive 4,020 per cent to ₹1,854 crore, operating profit grew a substantial 3,895 per cent to ₹1,558 crore, and net profit skyrocketed by an outstanding 5,077 per cent to ₹1,605 crore. The company’s earnings per share (EPS) also reflected this positive trend, reaching ₹2.53 for FY24. It has announced a 50:50 joint venture with BlackRock to establish a wealth management and broking business in India. The venture will initially operate as a wealth management company and later as a brokerage firm. India’s wealth management and broking sector is experiencing significant growth due to the rise in dematerialisation accounts. The company’s consolidated net profit increased significantly in the fiscal year ending FY24. Hence, we recommend BUY. 

KP Energy Ltd. (KPEL), a subsidiary of the KP Group based in Surat, specialises in developing utility-scale wind power infrastructure. Their services encompass the entire process, from siting wind farms and acquiring permits to constructing the infrastructure and operating the wind turbine generators with a focus on projects in Gujarat. The stock’s price is high relative to its net asset value (15.2 times book value), which could indicate overvaluation. However, this is partially offset by the company’s strong financial performance. Despite a concerning increase in debtor days (195 days) and working capital days (74.2 days), the company has delivered impressive profit growth of 24.6 per cent CAGR. It has also maintained a healthy with ROE of 34.7 per cent for the last three years. Furthermore, its recent financial results show continued growth, with net sales, operating profit and net profit all increasing in FY24 compared to FY23. This mixed picture suggests that further research is needed to determine if the high valuation is justified by the company’s prospects. Its promoters’ share sales and a high dependence on non-core ‘other income’ suggest a need for caution. A deeper look into valuation, promoter motives and the nature of other income is crucial before investing. Hence, we recommend SELL. 
 

Tejas Networks Ltd., founded in 2000, is a leading Indian company designing and manufacturing wireline and wireless networking equipment. Their focus on innovation and research and development has resulted in carrier-grade products used by telecom providers, utilities, governments, and defence networks in over 75 countries. Tejas Networks, now a part of the Tata Group, offers a wide range of products. Their client base spans various sectors including telecom service providers, internet service providers, critical infrastructure providers, web-scale companies, and government agencies. The company has with a market capitalisation of over ₹19,000 crore and an order book exceeding ₹8,200 crore at the end of FY24. They reported strong quarterly and annual results (Q4FY24 and FY24) and achieved significant milestones including shipping over 10,000 sites for BSNL’s 4G | 5G RAN network, completing the supply of 15,000 IP | MPLS routers for BSNL’s MAAN network, entering into a strategic partnership with Telecom Egypt for FTTx GPON equipment, and receiving awards for voice and data excellence and recognition from Gartner and Omdia for their products. Financially, the company’s earnings per share for Q4FY24 was 8.6 and their cash position at the year-end was ₹641 crore. Looking ahead, the company is focusing on international growth markets and has large projects lined up in India including BSNL 4G | 5G networks, BharatNet Phase 3, and broadband roll-outs. They are making significant investments in broadband equipment globally and expect to maintain their historical margins in the long term. Operationally, the company is integrating optical transport into their wireless products for differentiation and is engaged in multiple proof of concept for wireless products. Tejas Networks shows strong growth across all segments, particularly wireless. Their successful entry into high-growth areas like 4G | 5G RAN and IP | MPLS routing bodes well for the future. Executing India’s largest indigenous 4G | 5G networks further strengthens their position. Hence, we recommend HOLD 

Vodafone Idea Limited is a leading telecommunications service provider in India, offering a wide range of services including voice calls, broadband internet, mobile data, content services, enterprise solutions and various value-added services (VAS) like entertainment, SMS and utility services. The company boasts the largest spectrum holding in India, with coverage across nearly half a million towns and villages. It also has a robust infrastructure network spanning over 180,000 cell sites, 457,000 broadband sites and 370,600 kilometres of fibre optic cable laid across the country. However, Vodafone Idea, despite having a market capitalisation exceeding ₹80,000 crore, finds itself in a precarious financial position. This is due to their hefty debt burden, which sits at around ₹2.40 lakh crore. In comparison, their competitor Bharti Airtel boasts a market capitalisation over ₹7 lakh crore with a debt of approximately ₹2.17 lakh crore. While Vodafone Idea generates healthy sales figures, they have been incurring net losses for the past seven years. Conversely, Bharti Airtel experienced net losses only for two financial years but has since returned to profitability. Overall, Vodafone Idea’s financial struggles are evident despite their sales figures, making it difficult to compete effectively with Bharti Airtel and Jio. One notable issue is the ongoing decline in subscriber numbers, as indicated by a consistent decrease from 228.6 million at the end of Q3 to 215.2 million by Q3 of the following fiscal year. This reduction in the customer base might suggest challenges in customer retention or competitiveness in the market. Vodafone Idea raised ₹18,000 crore through its FPO to purchase equipment for 5G site creation, 4G site expansion and new 4G sites. However, profitability remains uncertain due to the high debt burden, competitive landscape and regulatory environment. The company faces hurdles such as Reliance Jio’s aggressive pricing and regulatory changes, making its path to profitability unclear. Hence, we recommend AVOID. 

HDFC Bank, founded in 1994, is India’s largest private sector bank offering a comprehensive suite of financial services like retail banking, wholesale banking and treasury operations. A publicly traded company with roots in HDFC Ltd., it boasts a global presence with offices across Bahrain, Hong Kong, the UAE, and Kenya. Notably, HDFC Bank is a leader in India’s payment system, pioneering the launch of international debit cards. It emerged from Housing Development Finance Corporation Limited (HDFC), one of the first to receive approval from the Reserve Bank of India to establish a private bank. HDFC Bank is a financially strong organisation, part of both the Sensex and Nifty indices, with a market capitalisation exceeding `10 lakh crore despite having a debt of over ₹21 lakh crore. The bank boasts a healthy track record of profit growth, averaging 23.5 per cent annually over the past five years, and consistently returning value to shareholders through a 22.9 per cent average dividend payout. Over the last decade, the bank’s sales have grown at a median rate of 16.4 per cent. In their latest annual results, HDFC Bank reported a significant increase in revenue and net profit. Its total revenue jumped 66 per cent to ₹283,649 crore in FY24 compared to the previous year, while the net profit grew 42 per cent to ₹65,446 crore. It’s worth noting that the bank’s earnings include a substantial amount of other income (₹124,346 crore) and carry contingent liabilities of ₹1,822,393 crore, which are potential future obligations depending on certain events. The stock is currently priced at 2.91 times its book value. The bank’s financials are looking good. Their ROA is at a healthy 2.59 per cent, and they saw impressive growth in both advances (₹1.1 trillion, up 4.9 per cent) and deposits (₹0.4 trillion, up 1.9 per cent) this quarter. Hence, we recommend HOLD. 

Cochin Shipyard Limited (CSL), founded in 1972, is a prominent Indian company involved in constructing, repairing, and upgrading all types of ships. With expertise in building large vessels for global clients, CSL has a proven track record, having exported 45 ships internationally. Their capabilities range from bulk carriers to technologically advanced ships like platform supply and anchor-handling tug supply vessels. Committed to innovation, CSL is currently developing zero-emission green vessels powered by hydrogen and electricity. The company reported a strong financial performance in February 2024 with a 62 per cent increase in turnover and an EBITDA margin of 34 per cent. In the projects and orders segment, INS Vikrant and ASW SWC projects are driving revenue in shipbuilding and ship repair. They have launched three vessels for the ASW SWC project and have two more in advanced stages. The company’s total order book stands at `21,500 crore, with significant orders in the defence and commercial sectors. Looking ahead, they expect a 15 per cent growth in turnover for FY25 with an EBITDA margin of around 18-19 per cent. Notably, the company’s shipbuilding order book has 52 per cent dedicated to green vessels, with a breakdown of defence (78 per cent), commercial domestic (6 per cent), commercial export (13 per cent) and subsidiaries (3 per cent). The company has a significant order book of ₹21,500 crore, with orders in the defence and commercial sectors. It has achieved a ‘GreenCo Gold’ rating and is focusing on the European market, particularly in the wind energy sector. The ship repair market is expected to grow significantly, targeting the replacement of old vessels with greener technologies. Taking into account factors such as valuation and finances, the company’s share looks attractive. Hence, we recommend BUY.