Derivatives and Quantitative Strategist

Gaudenz Schneider

Equity Bottom-Up

<ul>
<li>
Context: This Insight follows up on previously highlighted relative value opportunities, using a statistical methodology based on mean-reversion to identify opportunities in paired securities.</li>
<li>
Highlight: Two pair trade opportunities in the Indian financial sector persist, with price ratios exceeding two standard deviations from their historical means.</li>
<li>
Why read: Statistical analysis offers a unique perspective on relative value. Gain insights into actionable statistical pair trade opportunities and monitor performance of previously highlighted pairs.</li>
</ul>



Context: This Insight follows up on previously highlighted relative value opportunities, using a statistical methodology based on mean-reversion to identify opportunities in paired securities.

Highlight: Two pair trade opportunities in the Indian financial sector persist, with price ratios exceeding two standard deviations from their historical means.

Why read: Statistical analysis offers a unique perspective on relative value. Gain insights into actionable statistical pair trade opportunities and monitor performance of previously highlighted pairs.


Relative Value Roundup: Performance Recap of Financial Pair Trades

Market & Forensics Analyst, Beat the Street

Nimish Maheshwari

Market & Forensics Analyst

Beat the Street

Beat The Street was founded by Nimish Maheshwari and Sudarshan Bhandari, both of whom are Chartered Accountants by Profession, known for their expert analysis in the fields of Business, Sectoral analysis, and Corporate governance.

With a strong social media presence of 45,000+ Subscribers across various platforms, they are considered trusted voices in the industry. Their insights and analysis have been featured in some of India’s most prominent publications, including the Economic Times, Dalal Street Investment Journal, The Morning Context, and The Ken.

Their analysis on Bankrupt & Insolvent companies has been instrumental in saving investors from significant losses. They have a keen eye for identifying red flags and has identified exclusive redflags earlier in Vedanta, Nykaa, Dhani Services, Adani and many more.

Read Business Not Stock Prices

Thematic (Sector/Industry)

<ul>
<li>During rate cut cycle, NBFCs with a higher proportion of floating-rate liabilities &amp; a relatively lower proportion of floating-rate assets are poised to experience an expansion in their profitability.</li>
<li>This insight analyzes the asset-liability profiles of select Vehicle Financiers, Prime HFCs, and Affordable HFCs to identify their sensitivity to interest rate movements</li>
<li>Overall, NBFCs expect the benefit of the rate cut to have a lagged effect from H2FY26, leading  expansion in NIM and overall profitability</li>
</ul>


During rate cut cycle, NBFCs with a higher proportion of floating-rate liabilities &amp; a relatively lower proportion of floating-rate assets are poised to experience an expansion in their profitability.
This insight analyzes the asset-liability profiles of select Vehicle Financiers, Prime HFCs, and Affordable HFCs to identify their sensitivity to interest rate movements
Overall, NBFCs expect the benefit of the rate cut to have a lagged effect from H2FY26, leading  expansion in NIM and overall profitability


Thematic Report : Impact of Rate Cuts on Profitability of NBFCs and HFCs in India

ICICI Lombard General Insurance Company / Equity Bottom-Up

<ul>
<li>
Context: This article provides an update on a previously identified pair trading opportunity between <a href="https://www.smartkarma.com/entities/icici-lombard-general-insura" target="_blank" data-smartkarma-citation="entities:25882:1" rel="noopener">ICICI Lombard (ICICIGI IN)</a> and <a href="https://www.smartkarma.com/entities/sbi-life-insurance-co-ltd" target="_blank" data-smartkarma-citation="entities:25899:1" rel="noopener">SBI Life (SBILIFE IN)</a>, based on statistical mean reversion analysis.</li>
<li>
Key Insights: The trade has now reached its exit signal as the price ratio reverted to its one-standard deviation band, yielding a +9% return.</li>
<li>
Why Read It: For investors interested in quantitative trading strategies, this article demonstrates how statistical arbitrage can generate short-term alpha and highlights actionable similar opportunities in the current market.</li>
</ul>



Context: This article provides an update on a previously identified pair trading opportunity between ICICI Lombard (ICICIGI IN) and SBI Life (SBILIFE IN), based on statistical mean reversion analysis.

Key Insights: The trade has now reached its exit signal as the price ratio reverted to its one-standard deviation band, yielding a +9% return.

Why Read It: For investors interested in quantitative trading strategies, this article demonstrates how statistical arbitrage can generate short-term alpha and highlights actionable similar opportunities in the current market.


ICICI Lombard (ICICIGI IN) Vs. SBI Life (SBILIFE IN): Mean Reversion Delivers Gains, Trade Exit

External broker reports(aggregated public sources), HDFC Securities

HDFC Securities

External broker reports(aggregated public sources)

HDFC securities is the best online trading platform for stocks, IPOs, mutual fund in India. 

Content available is external broker reports authored by a third party outside the Smartkarma network and has been aggregated by an online aggregator through publicly available sources and is displayed by Smartkarma in this format for user's convenience and general informational purposes only. Content does not constitute investment or financial advice and Smartkarma makes no representation or warranty regarding its accuracy or contents. Original third party author retains all copyright and other proprietary rights in the content. Access or use of third party links not controlled by Smartkarma are at the user's own risk.

<ul><li>Kaynes Technology: Kaynes’ revenue grew 54% YoY at INR 9.85bn, supported by a strong order book</li><li>Gross margins significantly expanded by 720bps YoY to 32.1% due to a better product mix</li><li>EBITDAM improved by 210bps YoY to 17.1%, limited by a substantial increase in other expenses</li></ul>Content is external broker report sourced from online content aggregator through publicly available sources and is displayed below for general informational purposes only. Refer full disclaimer below.

Kaynes Technology: Kaynes’ revenue grew 54% YoY at INR 9.85bn, supported by a strong order bookGross margins significantly expanded by 720bps YoY to 32.1% due to a better product mixEBITDAM improved by 210bps YoY to 17.1%, limited by a substantial increase in other expensesContent is external broker report sourced from online content aggregator through publicly available sources and is displayed below for general informational purposes only. Refer full disclaimer below.

HSIE Results Daily: Kaynes Technology, LIC Housing Finance, CreditAccess Grameen

Index Rebal Trades & Special Situations, Quiddity Advisors

Janaghan Jeyakumar, CFA

Index Rebal Trades & Special Situations

Quiddity Advisors

Pan-Asia Catalysts/Events

Index Rebalance

<ul>
<li>In this insight, we take a look at the Potential ADDs/DELs for the BSE SENSEX, BSE 100, and BSE 200 indices in the June 2025 index rebal event.</li>
<li>As things stand, there could be two index changes for the SENSEX index.</li>
<li>There could be three ADDs/DELs for the BSE 100 index and eight ADDs/DELs for the BSE 200 index.</li>
</ul>


In this insight, we take a look at the Potential ADDs/DELs for the BSE SENSEX, BSE 100, and BSE 200 indices in the June 2025 index rebal event.
As things stand, there could be two index changes for the SENSEX index.
There could be three ADDs/DELs for the BSE 100 index and eight ADDs/DELs for the BSE 200 index.


Quiddity Leaderboard BSE/​​​​SENSEX Jun25: Pair Trade Delivers Strong Alpha; More Pair Trade Ideas

India

LIC Housing Finance Limited provides housing finance services to individuals for purchase, construction, repair and renovation of new or existing flats and houses. The Company also provides finance on existing property for business, personal needs and gives loans to professionals for purchase, construction of clinics, nursing homes, diagnostic centers, and office space throughout India.

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LIC Housing Finance (LICHF IN)

Relative Value Roundup: Performance Recap of Financial Pair Trades

A collection of relative value opportunities uncovered by a mean-reversion methodology, offering unique insights for potential gains in the Indian...

Gaudenz Schneider

Thematic Report : Impact of Rate Cuts on Profitability of NBFCs and HFCs in India

NBFCs with more floating-rate liabilities and less floating-rate assets set to profit from rate cuts, with increased profitability expected in...

Nimish Maheshwari

ICICI Lombard (ICICIGI IN) Vs. SBI Life (SBILIFE IN): Mean Reversion Delivers Gains, Trade Exit

Update on the pair trading opportunity between ICICI Lombard and SBI Life shows the trade has reached its exit signal with a profit, highlighting...

Gaudenz Schneider

HSIE Results Daily: Kaynes Technology, LIC Housing Finance, CreditAccess Grameen

Kaynes Technology: Kaynes’ revenue grew 54% YoY at INR 9.85bn, supported by a strong order book. Gross margins significantly expanded by 720bps YoY...

HDFC Securities

Quiddity Leaderboard BSE/SENSEX Jun25: Pair Trade Delivers Strong Alpha; More Pair Trade Ideas

The reference period for selection ranks ended on 30th April 2025. The only change in expectations since this insight is that we no longer see...

Janaghan Jeyakumar, CFA

Price Gauge

52-week Range

Market Cap (USDm)

P/E

Dividend (Yield)

Relative Value Roundup: Performance Recap of Financial Pair Trades

A collection of relative value opportunities uncovered by a mean-reversion methodology, offering unique insights for potential gains in the Indian...

Gaudenz Schneider

Thematic Report : Impact of Rate Cuts on Profitability of NBFCs and HFCs in India

​NBFCs with more floating-rate liabilities and less floating-rate assets set to profit from rate cuts, with increased profitability expected in...

Nimish Maheshwari

ICICI Lombard (ICICIGI IN) Vs. SBI Life (SBILIFE IN): Mean Reversion Delivers Gains, Trade Exit

Update on the pair trading opportunity between ICICI Lombard and SBI Life shows the trade has reached its exit signal with a profit, highlighting...

Gaudenz Schneider

HSIE Results Daily: Kaynes Technology, LIC Housing Finance, CreditAccess Grameen

Kaynes Technology: Kaynes’ revenue grew 54% YoY at INR 9.85bn, supported by a strong order book. Gross margins significantly expanded by 720bps YoY...

HDFC Securities

Quiddity Leaderboard BSE/​​​​SENSEX Jun25: Pair Trade Delivers Strong Alpha; More Pair Trade Ideas

The reference period for selection ranks ended on 30th April 2025. The only change in expectations since this insight is that we no longer see...

Janaghan Jeyakumar, CFA

NBFCs with more floating-rate liabilities and less floating-rate assets set to profit from rate cuts, with increased profitability expected in...

Quiddity Leaderboard BSE/SENSEX Jun25: Pair Trade Delivers Strong Alpha; More Pair Trade Ideas