Specialist in Indian Banking and Economic Research

Hemindra Hazari

Thematic (Sector/Industry)

True, the field is crowded, and fresh insights are hard to come by. Still, contrary to Douglas Kim’s argument, it’s not mid-caps, but large-caps, that offer profitable subject matter for research. The advantage for the truly independent researcher is that, while the usual corporate doors are quickly shut, there are plenty of other doors no one thinks of opening.For independent research to be recognized as a credible alternative to sell-side research, it has to play in the same field where the big girls and boys play, and in equities, it is large cap research. There is ample space for unusual perspectives and more importantly critical commentary for enterprising analysts to standout in the faceless herd and do the profession proud.

True, the field is crowded, and fresh insights are hard to come by. Still, contrary to Douglas Kim’s argument, it’s not mid-caps, but large-caps, that offer profitable subject matter for research. The advantage for the truly independent researcher is that, while the usual corporate doors are quickly shut, there are plenty of other doors no one thinks of opening.For independent research to be recognized as a credible alternative to sell-side research, it has to play in the same field where the big girls and boys play, and in equities, it is large cap research. There is ample space for unusual perspectives and more importantly critical commentary for enterprising analysts to standout in the faceless herd and do the profession proud.

The Profits (And Perils) Of Independent Large Cap Research

Founder and Strategist, Entext Economics & Strategy

Sean Maher

Founder and Strategist

Entext Economics & Strategy

Entext provides institutional investors with distinctive, actionable asset allocation and thematic research, which typically challenges the market consensus. Our clients range from credit, equity and multi-asset hedge and pension funds to family offices and sovereign funds. 
 
We focus on identifying key inflection points in macro data and relative asset performance amid the 'groupthink'  and confirmation bias that characterizes most investment bank analysis.

Macro Driven Investment Insight

Macroeconomics

<ul>
<li>Russia and India have looked the riskiest EM banking sectors, the former having seen a huge bailout of Otkritie and B&amp;N while India’s state banks have been in suspended animation since 2015.</li>
<li>China has a structural surplus of savings and India a shortage (partly because of the cultural gold obsession), driving a weak credit multiplier, underinvestment and requiring high real rates.</li>
<li>The convoluted recapitalization plan aims to boost credit growth standing at just over 6% y/y (down 4.7ppts in a year)…</li>
</ul>


Russia and India have looked the riskiest EM banking sectors, the former having seen a huge bailout of Otkritie and B&amp;N while India’s state banks have been in suspended animation since 2015.
China has a structural surplus of savings and India a shortage (partly because of the cultural gold obsession), driving a weak credit multiplier, underinvestment and requiring high real rates.
The convoluted recapitalization plan aims to boost credit growth standing at just over 6% y/y (down 4.7ppts in a year)…


India Props Up State Banks Yet Again, Korean Chaebol Moment of Truth

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

Asia is leading EM higher.  In this week's Chart Book, we highlight the following themes and actionable charts: <ul><li>Overweight Asia. In today’s report we highlight a broad array of actionable names within the Asia region ... see pages 3-6</li><li>Indian banks are breaking out. India’s state banks broke out last week in response to the government’s announcement of a $32.5 billion recapitalization plan. Actionable ideas: Punjab National Bank (532461-IN), State Bank of India (500112-IN), ICICI Bank (532174-IN)... see page 2</li><li>Leading Sectors. EM sectors exhibiting attractive relative strength trends include: consumer discretionary, energy, financials, health care, materials, and tech. This (mostly) cyclical line-up supports a risk-on outlook. When defensive sectors exhibit improving relative strength, then we’ll turn cautious on EM’s advance.</li></ul>

Asia is leading EM higher.  In this week's Chart Book, we highlight the following themes and actionable charts: Overweight Asia. In today’s report we highlight a broad array of actionable names within the Asia region ... see pages 3-6Indian banks are breaking out. India’s state banks broke out last week in response to the government’s announcement of a $32.5 billion recapitalization plan. Actionable ideas: Punjab National Bank (532461-IN), State Bank of India (500112-IN), ICICI Bank (532174-IN)... see page 2Leading Sectors. EM sectors exhibiting attractive relative strength trends include: consumer discretionary, energy, financials, health care, materials, and tech. This (mostly) cyclical line-up supports a risk-on outlook. When defensive sectors exhibit improving relative strength, then we’ll turn cautious on EM’s advance.

EM Technicals: Overweight Asia; Indian Banks Are Breaking Out; Bottom-Up Ideas

Senior investment analyst

Pallavi Deshpande

Equity Bottom-Up

<h2>Results</h2>ICICI Bank's 2Q18 net profit was 19% below consensus expectations due to a decline in treasury income (excluding the stake sale in a subsidiary). Core operating performance was in line with expectations with net interest income growth of 8.7% YoY and NIM at 3.3% (flat QoQ, +2 bps YoY) and benign operating cost growth of 4.6% YoY. Loan growth was muted at 6% YoY as it continues to trim its international book. Slippages declined QoQ, with retail slippages surprising positively with a…

ResultsICICI Bank's 2Q18 net profit was 19% below consensus expectations due to a decline in treasury income (excluding the stake sale in a subsidiary). Core operating performance was in line with expectations with net interest income growth of 8.7% YoY and NIM at 3.3% (flat QoQ, +2 bps YoY) and benign operating cost growth of 4.6% YoY. Loan growth was muted at 6% YoY as it continues to trim its international book. Slippages declined QoQ, with retail slippages surprising positively with a…

ICICI Bank 2Q18: Rising Risk of NPL Divergence with RBI

We believe <a href="https://www.smartkarma.com/entities/547" target="_blank" data-smartkarma-citation="entities:547:1">ICICI Bank Ltd (ICICIBC IN)</a> stock performance will be determined by investors perception on where it stands in this cycle of NPL cleanup. Management guided for a significant decline in slippages in FY18 during the FY17 analyst call and with most of it expected to come from the watchlist (WL). However, 1Q18 results saw slippages outside the WL outpace WL slippages and management guides for slippages outside the WL to increase in FY18. We believe management is now focussing on a cleanup…

We believe ICICI Bank Ltd (ICICIBC IN) stock performance will be determined by investors perception on where it stands in this cycle of NPL cleanup. Management guided for a significant decline in slippages in FY18 during the FY17 analyst call and with most of it expected to come from the watchlist (WL). However, 1Q18 results saw slippages outside the WL outpace WL slippages and management guides for slippages outside the WL to increase in FY18. We believe management is now focussing on a cleanup…

ICICI Bank: NPL Cleanup to Spillover into FY19

India

ICICI Bank Limited operates as a bank. The Bank offers saving accounts, loans, debit, credit cards, insurance, investments, mortgages, and online banking services. ICICI Bank serves customers worldwide.

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ICICI Bank Ltd (ICICIBC IN)

The Profits (And Perils) Of Independent Large Cap Research

True, the field is crowded, and fresh insights are hard to come by. Still, contrary to Douglas Kim’s argument, it’s not mid-caps, but large-caps,...

Hemindra Hazari

India Props Up State Banks Yet Again, Korean Chaebol Moment of Truth

Russia and India have looked the riskiest EM banking sectors, the former having seen a huge bailout of Otkritie and B&N while India’s state...

Sean Maher

EM Technicals: Overweight Asia; Indian Banks Are Breaking Out; Bottom-Up Ideas

Asia is leading EM higher. In this week's Chart Book, we highlight the following themes and actionable charts: Overweight Asia. In today’s...

Vermilion Research

ICICI Bank 2Q18: Rising Risk of NPL Divergence with RBI

ResultsICICI Bank's 2Q18 net profit was 19% below consensus expectations due to a decline in treasury income (excluding the stake sale in a...

Pallavi Deshpande

ICICI Bank: NPL Cleanup to Spillover into FY19

We believe ICICI Bank Ltd (ICICIBC IN) stock performance will be determined by investors perception on where it stands in this cycle of NPL...

Pallavi Deshpande

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