Equity L/S Analyst | Forensic Accounting | India, Yellowstone Equity

Ankit Agrawal, CFA

Equity L/S Analyst | Forensic Accounting | India

Creating Wealth through Alpha and Compounding

Yellowstone Equity

Providing unbiased and independent research on Indian equities to global institutions and individual investors


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Regulatory Disclosure: 
Note that Ankit Agrawal (Proprietor of Yellowstone Equity) is a SEBI registered Research Analyst (Registration No.: INH000007216). Registration granted by SEBI and certification from NISM in no way guarantee performance of the intermediary or provide any assurance of returns to investors. Investment in securities market are subject to market risks. Read all the related documents carefully before investing.

Research Analyst Contact Details:
Address: A-412, Shilp Aaron, Sindhu Bhavan Road, Ahmedabad, Gujarat - 380059
Email: services@yellowstoneequity.com
Mobile: +91-7575817289

Compliance/Grievance Officer:
Name: Ankit Agrawal
Email: services@yellowstoneequity.com
Mobile: +91-7575817289
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Equity Bottom-Up

<ul>
<li>We published on Polycab as our 2023 high conviction idea on Dec 25 2022. Since then, the stock has been up 75%+, exceeding our 65%+ upside FY26 target.</li>
<li>The steep rise was probably driven by strong earnings growth on the back of upbeat demand environment led by healthy domestic capex, rising exports and robust housing demand.</li>
<li>At the current valuation, Polycab is richly valued and we assign a "SELL" rating. Polycab's current market cap at INR 68700cr+ is well above our FY26 projection of INR 63500cr+.</li>
</ul>


We published on Polycab as our 2023 high conviction idea on Dec 25 2022. Since then, the stock has been up 75%+, exceeding our 65%+ upside FY26 target.
The steep rise was probably driven by strong earnings growth on the back of upbeat demand environment led by healthy domestic capex, rising exports and robust housing demand.
At the current valuation, Polycab is richly valued and we assign a "SELL" rating. Polycab's current market cap at INR 68700cr+ is well above our FY26 projection of INR 63500cr+.


2023 High Conviction Update | Polycab: Played Out As Anticipated, Now Time to Exit

External broker reports(aggregated public sources), Axis Direct

Axis Direct

External broker reports(aggregated public sources)

Axis Direct is the flagship brand under Axis Securities Limited, a subsidiary of Axis Bank 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>Strong growth in C&amp;W while FMEG witnessed muted growth: Polycab India reported revenues of Rs 3,889 Cr, up 42% YoY, far exceeding our expectations of Rs 3,125 Cr.</li><li>Revenues growth was driven by healthy volume growth in the Cables &amp; Wires segment supported by strong traction in international business.</li><li>Cables &amp; Wires revenue for the quarter grew by 46% YoY to Rs 3,534 Cr, while the FMEG segment grew 3% QoQ during the quarter.</li></ul><p><em>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.</em></p>

Strong growth in C&amp;W while FMEG witnessed muted growth: Polycab India reported revenues of Rs 3,889 Cr, up 42% YoY, far exceeding our expectations of Rs 3,125 Cr.Revenues growth was driven by healthy volume growth in the Cables &amp; Wires segment supported by strong traction in international business.Cables &amp; Wires revenue for the quarter grew by 46% YoY to Rs 3,534 Cr, while the FMEG segment grew 3% QoQ during the quarter.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.

Polycab India - Robust Growth Led by Strong Demand Environment

External broker reports(aggregated public sources), HDFC Securities

HDFC Securities

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.

Thematic (Sector/Industry)

<ul><li>U.S. stocks closed higher Tuesday, with investors primed to take Wednesday’s inflation report in stride, while also hoping for a solid start to second-quarter corporate earnings later this week.</li><li>Treasury yields eased further, after rates pulled back on Monday from recent highs. The 10-year Treasury yield fell 2.6 basis points to 3.980% on Tuesday.</li><li>The June US consumer-price index report to be released on Wednesday is expected to show headline annual inflation falling to 3.1%, having hit a multi-decade peak of 9.1% a year before. </li></ul><p><em>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.</em></p>

U.S. stocks closed higher Tuesday, with investors primed to take Wednesday’s inflation report in stride, while also hoping for a solid start to second-quarter corporate earnings later this week.Treasury yields eased further, after rates pulled back on Monday from recent highs. The 10-year Treasury yield fell 2.6 basis points to 3.980% on Tuesday.The June US consumer-price index report to be released on Wednesday is expected to show headline annual inflation falling to 3.1%, having hit a multi-decade peak of 9.1% a year before. 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.

<div><div><div><div><ul><li>Demand trends: The overall consumer demand remained tepid during the quarter owing to the uneven weather conditions and unseasonal rains during the summer season.</li><li>As a result, seasonal products such as fans, coolers, and ACs witnessed lacklustre demand in Apr’23 as well as in May’23 while some demand uptick was seen in Jun’23.</li><li>Soft demand amidst higher competitive intensity and inventory built up in anticipation of strong summer restricted any price hikes by OEMs. </li></ul></div></div></div></div><p><em>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.</em></p>

Demand trends: The overall consumer demand remained tepid during the quarter owing to the uneven weather conditions and unseasonal rains during the summer season.As a result, seasonal products such as fans, coolers, and ACs witnessed lacklustre demand in Apr’23 as well as in May’23 while some demand uptick was seen in Jun’23.Soft demand amidst higher competitive intensity and inventory built up in anticipation of strong summer restricted any price hikes by OEMs. 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.

Consumer Durables - Q1FY24 - Earnings Preview

Pan-Asia Index Rebalances/ Events/ Delta One, Periscope Analytics

Brian Freitas

Pan-Asia Index Rebalances/ Events/ Delta One

Periscope Analytics

Periscope Analytics focuses on event-driven trades across Asia Pacific and provides comprehensive, timely and systematic coverage of index changes to major Asia Pacific indices in a structured manner.

The analysis includes forecasted inclusions and exclusions to all major Asian indices that have significant amount of tracking assets, including estimates of passive buy/sell flow on the stocks. The service also provides commentary and impact of market consultations, ground rule changes, and other events (IPOs, spin-offs, M&A) that could lead to index changes and passive flow.

Periscope Analytics works with multi-strategy hedge funds, proprietary trading firms, stat arb trading groups and long-only investors that invest and trade in the Asia Pacific region with the data being used to trade index rebalances, avoid pre-positioning and passive flow, and to time entry into and exit from stocks.

Event-Driven Trades Across Asia Pacific

Index Rebalance

<ul>
<li>It was a busy week with index rebalance implementations and announcements of index changes.</li>
<li>The coming week has the KOSPI200 and KOSDAQ150 rebalancing on Thursday and a bunch of onshore China indices rebalancing on Friday.</li>
<li>There were big inflows to China ETFs during the week while the largest inflows went to the <a href="https://www.smartkarma.com/entities/tracker-fund-of-hong-kong-ltd" target="_blank" data-smartkarma-citation="entities:29257:1" rel="noopener">Tracker Fund of Hong Kong Ltd (2800 HK)</a> ETF.</li>
</ul>


It was a busy week with index rebalance implementations and announcements of index changes.
The coming week has the KOSPI200 and KOSDAQ150 rebalancing on Thursday and a bunch of onshore China indices rebalancing on Friday.
There were big inflows to China ETFs during the week while the largest inflows went to the Tracker Fund of Hong Kong Ltd (2800 HK) ETF.


Index Rebalance & ETF Flow Recap: CSI300/500, Chinext, China Semi Chips, Nifty Next50, SET50, REMX

India

Polycab India Limited produces and distributes electronic equipment. The Company offers cables, wires, fans, switches, lighting, junction boxes, circular lids, and pumps. Polycab India serves customers in India.   

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Polycab India (POLYCAB IN)

2023 High Conviction Update | Polycab: Played Out As Anticipated, Now Time to Exit

Polycab is up 75%+ in seven months, since our report on Dec 25 2022 as 2023 High Conviction Idea. At current valuation, it appears to be richly...

Ankit Agrawal, CFA

Polycab India - Robust Growth Led by Strong Demand Environment

Strong growth in C&W while FMEG witnessed muted growth: Polycab India reported revenues of Rs 3,889 Cr, up 42% YoY, far exceeding our expectations...

Axis Direct

Viewpoint: The Daily

Indian markets could open flat to mildly higher, in line with mostly higher Asian markets today and positive US markets on July 11.

HDFC Securities

Consumer Durables - Q1FY24 - Earnings Preview

Soft demand amidst higher competitive intensity and inventory built up in anticipation of strong summer restricted any price hikes by OEMs.

Axis Direct

Index Rebalance & ETF Flow Recap: CSI300/500, Chinext, China Semi Chips, Nifty Next50, SET50, REMX

This recap highlights Insights covering Asian index rebalances (announcements/ forecasts/ IPO Fast Entry/ M&A driven changes). We also highlight...

Brian Freitas

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