India - Politics, Industrials, IT and Large Caps, EMAlpha

Pankaj Sharma

India - Politics, Industrials, IT and Large Caps

Thematic (Sector/Industry)

A 0.81% correction in NIFTY and 0.75% correction in BSE SENSEX is by no means an exceptional movement in an emerging market like India. But, today wasn't an ordinary day for the Indian Markets. It was a day when the market saw an approximately 4% swing on an intra-day basis and a BSE 30 stock, <a href="https://www.smartkarma.com/entities/767" target="_blank" data-smartkarma-citation="entities:767:1">Yes Bank Ltd (YES IN)</a> lost 29% of its value. The immediate trigger behind such an exceptional intra-day movement may have been rumors of a default by <a href="https://www.smartkarma.com/entities/8142" target="_blank" data-smartkarma-citation="entities:8142:1">Dewan Housing Finance (DEWH IN)</a> which corrected more than 40%, but these moves certainly impact the sentiment of market participants. While valuation and quality concerns will become more important discussion points, another big worry is that if this weakness will lead to panic among investors especially among retail participants.

A 0.81% correction in NIFTY and 0.75% correction in BSE SENSEX is by no means an exceptional movement in an emerging market like India. But, today wasn't an ordinary day for the Indian Markets. It was a day when the market saw an approximately 4% swing on an intra-day basis and a BSE 30 stock, Yes Bank Ltd (YES IN) lost 29% of its value. The immediate trigger behind such an exceptional intra-day movement may have been rumors of a default by Dewan Housing Finance (DEWH IN) which corrected more than 40%, but these moves certainly impact the sentiment of market participants. While valuation and quality concerns will become more important discussion points, another big worry is that if this weakness will lead to panic among investors especially among retail participants.  

India: "I Had Told You So" Moment Finally Here for Markets? Valuation and Quality to Gain in Debate

Technical Analyst, Vermilion Research

Joe Jasper

Technical Analyst

Technical and Quantitative Research

Vermilion Research

Vermilion’s objective is to deliver timely, actionable, and unique technical research to professional investors through the application of our various technical indicators.

Our research strategists seek to highlight securities which we believe are at major inflection points, based on our various technical and quantitative indicators, and offer asymmetric risk/return profiles. Our unique research methodology, centered on relative strength, enables our strategists to deliver superior investment recommendations.

Our process begins by organizing the universe of actively traded stocks into discrete sectors, then into industry groups. We then apply our technical and quantitative tools to identify developing price trends. Once attractive trends are identified within a selected sector or group, we screen for individual stocks which we believe offer the best risk/reward profile. We provide a historical perspective that often reveals, through our long-term charts, how price patterns often repeat themselves over time.

Technical Analysis

MSCI Emerging Markets Index / Technical Analysis

In this report we provide a synopsis of EM markets. We also scour the EM universe for attractive and actionable opportunities, highlighting opportunities within India's SENSEX, global energy and materials sectors, and Asian banks.

In this report we provide a synopsis of EM markets. We also scour the EM universe for attractive and actionable opportunities, highlighting opportunities within India's SENSEX, global energy and materials sectors, and Asian banks.

Specialist in Indian Banking and Economic Research

Hemindra Hazari

Post the Bharatiya Janata Party’s (BJP) decisive victory in the Uttar Pradesh (UP) state elections, alarm bells have commenced tolling in the capital market.  The cause for concern is the BJP’s promise to the UP electorate to waive off all farm loans and provide fresh loans at zero per cent interest. Media, capital market analysts and prominent bankers have jumped on the bandwagon of moral hazard, ruining the loan payment discipline amongst farmers and apprehensions that the sacrosanct fiscal deficit may be breached as a consequence of such ‘populist’ policies. The BJP electoral promise raises some issues which need to be explored further on whether the central government has the fiscal space to provide for a total farm waiver and whether the criticism of moral hazard is credible.

Post the Bharatiya Janata Party’s (BJP) decisive victory in the Uttar Pradesh (UP) state elections, alarm bells have commenced tolling in the capital market.  The cause for concern is the BJP’s promise to the UP electorate to waive off all farm loans and provide fresh loans at zero per cent interest. Media, capital market analysts and prominent bankers have jumped on the bandwagon of moral hazard, ruining the loan payment discipline amongst farmers and apprehensions that the sacrosanct fiscal deficit may be breached as a consequence of such ‘populist’ policies. The BJP electoral promise raises some issues which need to be explored further on whether the central government has the fiscal space to provide for a total farm waiver and whether the criticism of moral hazard is credible.

U.P. Loan Waiver: 'Populist' or a Necessity?

Research and consultancy, Tabbush Report

Daniel Tabbush

Research and consultancy

Tabbush Report

We provide research and consultancy on Asian banks. Our focus is on what we call “Asian bank research, without the noise.” We are interested in the most critical swing-factors for banks, the NPL and credit cycle, and where we believe there is a gap between perception and reality. We often focus on the less studied components of bank financial statements.  Our research is highly thematic, sometimes examining unlisted banks and companies as a window on mainstream banks. 

Being independent allows us to look at smaller banks, often overlooked by others. Analysis of BIS bank guidelines in the context of Asia, is also a focal point, while we also analyze global banks operating in the region. We use what we believe is the most comprehensive, reliable financials database, SNL Financial. S&P Capital IQ augments our database, with corporate data and CEIC, with economics. 

Asian bank research, without the noise.

The collapse of lending in India remains well in place in January where annual growth is running at an anemic 3.3%. This is the same as in December last year, and lower than in November. To us, it does not feel like India is anywhere near a post-demonetization boom in credit, as some are expecting. The reality is that companies will see more stress, economic growth will worsen, and banks will face greater NPLs. India – Credit growth (% ch YoY)<figure class="editor-figure mceNonEditable"><img src="https://static-prod.smartkarma.com/images/media/000/022/174/original/daniel%201.png?1488984550" class="editor-image img-responsive" data-smartkarma-image-id="22174"></figure><div class="content-caption">Source: CEIC</div>What may be more of a surprise is that…

The collapse of lending in India remains well in place in January where annual growth is running at an anemic 3.3%. This is the same as in December last year, and lower than in November. To us, it does not feel like India is anywhere near a post-demonetization boom in credit, as some are expecting. The reality is that companies will see more stress, economic growth will worsen, and banks will face greater NPLs. India – Credit growth (% ch YoY)Source: CEICWhat may be more of a surprise is that…

India's Lending Is Still Painfully Low in January

Since India’s demonetization, the government has lowered GDP forecasts, the Reserve Bank of India has signaled a less accommodative stance, and the proposed recapitazliation of ailing public sector banks is being curtailed. Perhaps there will be less flow-through on the budget in execution, timing and magnitude? High non-performing loans and cratering loan growth was a feature of India’s banks before all of the above, and we believe these will remain front and center still.  We include several…

Since India’s demonetization, the government has lowered GDP forecasts, the Reserve Bank of India has signaled a less accommodative stance, and the proposed recapitazliation of ailing public sector banks is being curtailed. Perhaps there will be less flow-through on the budget in execution, timing and magnitude? High non-performing loans and cratering loan growth was a feature of India’s banks before all of the above, and we believe these will remain front and center still.  We include several…

Anecdotes from India Mirror Poor Optimism: Bank Risk Remains

India

Dewan Housing Finance Corporation Ltd. provides housing finance services in India.  Dewan also leases commercial and residential premises to various companies.

Price Gauge
52-week Range	0.00 - 0.00
Market Cap (USDm)	0.00
P/E	0.00
Dividend (Yield)	0.00

Dewan Housing Finance (DEWH IN)

India: "I Had Told You So" Moment Finally Here for Markets? Valuation and Quality to Gain in Debate

A 0.81% correction in NIFTY and 0.75% correction in BSE SENSEX is by no means an exceptional movement in an emerging market like India. But, today...

Pankaj Sharma

EM Strategy: Remain Overweight India

In this report we provide a synopsis of EM markets. We also scour the EM universe for attractive and actionable opportunities, highlighting...

Vermilion Research

U.P. Loan Waiver: 'Populist' or a Necessity?

Post the Bharatiya Janata Party’s (BJP) decisive victory in the Uttar Pradesh (UP) state elections, alarm bells have commenced tolling in the...

Hemindra Hazari

India's Lending Is Still Painfully Low in January

The collapse of lending in India remains well in place in January where annual growth is running at an anemic 3.3%. This is the same as in December...

Daniel Tabbush

Anecdotes from India Mirror Poor Optimism: Bank Risk Remains

Since India’s demonetization, the government has lowered GDP forecasts, the Reserve Bank of India has signaled a less accommodative stance, and the...

Daniel Tabbush

Price Gauge

52-week Range

Market Cap (USDm)

P/E

Dividend (Yield)