Investment Ideas - ING Vysya Bank

ING Vysya Bank is one among the prominent Private sector Banks operating in India. The incorporation of the bank was done in the year 1930. In the year 1945, it became a Scheduled Bank. The bank was formed in the year 2002, by the acquisition of an equity stake in then known as Indian Vysya Bank by the Dutch ING Group. This acquisition is probably the first between an Indian bank and a foreign bank. Earlier the Vysya Bank had an alliance with a Belgian bank Banque Bruxelles Lambert. This bank was acquired by ING Group in 1998. The ING Vysya Bank Limited as it is known today is providing services in four segments, namely Treasury, Retail Banking, Wholesale Banking and Other Banking Operations. The Treasury segment deals with investment related to bonds, Mutual funds, Debt market, Derivatives and Forex. The Retail banking segment refers to its business related with Individuals Automated Teller Machines and Internet Banking. The Bank’s wholesale Banking is actually the business it does with large companies, Loans and Institutional operation.

The bank has a well spread network of 527 branches. The bank employs about 10,000 people catering to its customers.

Some of the important events in the banks history have been listed below:

In the year 2000, the Vysya Leasing Ltd became a subsidiary of the Bank. A Data Centre came up at IT park Bangalore in November 2000. The year 2001 saw the promotion of a company by the name ING Vysya Life Insurance Company Ltd. This company was responsible for the Bank’s life insurance business in India. The year 2002 was eventful year for the Bank. They launched new products and services like Vsya Vyapar Plus, ATM services, hospitalization insurance cover, Debit cards, and Net banking services. This was the year in which the ING took over the complete management of the Bank. During the year 2003-2004 the Bank launched insurance products, Mutual funds business.  In the year 2003 the bank divested their stake in Vysya Bank Housing finance Ltd to Dewan Housing finance Ltd. Also in 2003 the Bank issued Tier II Bonds to the tune of Rs. 200 Crores. In the year 2005-2006 the Bank divested its   stake of 14.87 % in Vysya Life Insurance Company to Gujarat Ambuja Cements.

In April 2007, the Bank sold their entire shares held in Investment Management (India) Pvt Ltd. The parent Bank ING Bank N V was seen investing in the Tier I issued by ING Vysya Bank Ltd, by way of Innovative Perpetual Bonds (IPDs) in foreign currency. The value of these investment totaled Rs 94.50 Crore with a call option at the end of a 10 year period.

According to available data, the Bank’s major source of income is interest earned is 4861.58 which is 1004.77 Crores more than last year. With other income the total income stands at 5588.46 Crores. Expenditure has been disclosed as 3322.95 Crores. Operating and Administrative expenses are 221.27 Crores. Cost of depreciation is 50.97 Crores.  The Bank’s total net profit has been reported as 612.96 Crores. The EPS is currently at Rs. 38.69

The Bank has been consistently paying good dividends to the investors. In the last five years starting from 2009 it has been seen paying higher dividends (20%, 25%, 30%, 40%, and 55%). The dividend record seems to be good.

The declared Dividend is 55%. The Book value of this share is 292.10.

The Bank’s shares are constantly on an uptrend mode the shares that were trading at Rs. 330 last year (31-06-2012), are trading at Rs. 650 (31-06-2013). Investors with a longer time frame can take a look at this banking company’s shares. Even with a shorter time frame, this could be a profitable investment.

 

Investment Ideas - Dabur India Ltd

Dabur India Ltd
Dabur is a 125 years old company which started functioning in 1884. This company was promoted by the Burman family. In the beginning the company was primarily engaged in manufacturing Ayurvedic preparations. Today Dabur has transformed itself as a world leader in Ayurvedic products. It has over 250 herbal and Ayurvedic products lined up, starting from Heal care products, personal hygiene, digestives, fruit juices, beverages, fairness bleaches and skin care products. The company is said to have access to 2.8 million retail outlets with a high reach in urban and rural areas. 

Dabur India Ltd is one of India’s leading Fast Moving Consumer Goods (FMCG) Companies. It has become a most trusted household name in the Indian Market. Some of the famous brand names of Dabur includes, Vatika (Hair Oil), Dabur Amla Hair Oil, Anmol Coconut oil, Vatika shampoo (a wide range of products from anti-dandruff to conditioners), Tooth Paste ( Meswak, Neem, Basil, Clove), Soaps (Sandalwood, Neem, Aloe Vera), Gulabari(Rose water), boroglow (Antiseptic cream), Vatika fairness cream, Chyawanprash, Hajmola, Pudin Hara, Dabur Balm ( pain reliever), Restora, Honitus syrup ( Cold syrup), Rheumatil gel, Itch care, Ring Ring ( ring worm reliever), Baby Olive Oil.
In the Food Product range, the brand name includes, Dabur Honey, Real fruit Juice, Real Active, Cooking Pastes, Coconut milk, red pepper sauce, Lemoneez, cardamom extract, Glucose D, Rose syrup.

The company’s Revenues are said to be above Rs. 6146 Crores. Its Market Capitalisation stands at 5 Billion US Dollars.
Dabur’s product ranges have reached beyond the Indian markets to make its presence in over 60 countries. There is a large concentration of Indian Communities living in overseas. Indian communities in the Middle+ East, SAARC countries, Africa, US, Europe and Russia find Dabur products familiar and trustworthy. It is reported the Dabur's overseas revenue accounts for over 30% of the total turnover.
Dabur has 11 manufacturing facilities in India. It has also factories abroad too. Altogether Seventeen manufacturing facilities help maintain the product line of Dabur. Dabur is also exporting Active Pharmaceutical Ingredients (APIs) to Europe, Latin America, Africa, and other Asian countries

In the month of June 2012 Dabur International Limited sold off its entire interest in Weikfield International (U.A.E.) Ltd. In November 2012, the Company established a subsidiary Company in Brazil, named Namaste Cosmeticos Ltd.

According to the available sources, The Company has registered a revenue growth of 12.5% during Q4 FY13. Domestic revenues increased by 15.1% yoy.  It has registered domestic volume growth of 12% yoy. The hair care segment has crossed Rs10bn mark and recorded 9.6% yoy. Shampoos and Hair oils growth of 29.4% and 13% respectively the Toothpaste segment growth rate was 12.3%. However, the brand Babool did not register any growth. The brands Odomos, Odonil, and Sanifresh have seen increase of 33.3%. The Skin care products have seen growth of 11.1%.

In the Foods segment Real has given a thrust to boost the growth to a 22.6%.  The Health supplements have recorded  a good growth of 22.6% ( Dabur Honey and Glucose) The overall revenue of the company is currently at 16.4% yoy. 

The overseas operations have also yielded good revenues, a growth of 11.6%. The company hopes the Namaste business could do well in the future to bring more revenue.

The Debt/Equity  has come down from 0.6 to 0.5. There is a good chance to this figure to come down even lower in the forthcoming Financial Years. The Current EPS stands at 4.4 and it is expected to rise to 5.1 and 6.0 for FY14 and Fy15 respectively.

The promising growth rate and the company’s stand in the Indian Market, Dabur becomes an important stock, which an investor should actively consider for his portfolio. At the time of writing this notes the Dabur’s shares were trading at Rs. 155.40.Traders with a view of short term investment plan can accumulate this share for the targets of 173 and 183.

Disc: I do not hold any shares or any interests in the above said company.