Consumer Analyst / Channel Surveillance Specialist, Trudence Capital Advisors

Pranav Bhavsar

Consumer Analyst / Channel Surveillance Specialist

Trudence Capital Advisors

Trudence Capital Advisors Private Limited is a SEBI-registered Research Analyst, holding SEBI registration number INH000015747. Our firm is dedicated to providing independent and unbiased research on Indian mid to large-cap companies. Trudence Capital is known for its counter-consensus views, with a focus on forensic research and on-ground primary investigations. Our research approach is thorough, involving detailed analysis of accounting practices and governance, alongside extensive channel checks.

Independent & Unbiased Research

Equity Bottom-Up

<ul>
<li>The index seems to be finding support at 19,500 for the second consecutive week. Bullish momentum could resume when we close above 19,800 on the <a href="https://www.smartkarma.com/entities/nifty-index" target="_blank" data-smartkarma-citation="entities:23617:1" rel="noopener">NIFTY Index (NIFTY INDEX)</a> .</li>
<li>Names discussed include <a href="https://www.smartkarma.com/entities/titan-co-ltd" target="_blank" data-smartkarma-citation="entities:12630:1" rel="noopener">Titan Co Ltd (TTAN IN)</a>, <a href="https://www.smartkarma.com/entities/maruti-suzuki-india-ltd" target="_blank" data-smartkarma-citation="entities:733:1" rel="noopener">Maruti Suzuki India (MSIL IN)</a> and <a href="https://www.smartkarma.com/entities/metro-brands" target="_blank" data-smartkarma-citation="entities:35289:1" rel="noopener">Metro Brands (METROBRA IN)</a>.  </li>
<li>We also introduce the Earnings Diary which will be part of the publication, tracking estimates and narratives around over coverage. </li>
</ul>


The index seems to be finding support at 19,500 for the second consecutive week. Bullish momentum could resume when we close above 19,800 on the NIFTY Index (NIFTY INDEX) .
Names discussed include Titan Co Ltd (TTAN IN), Maruti Suzuki India (MSIL IN) and Metro Brands (METROBRA IN).  
We also introduce the Earnings Diary which will be part of the publication, tracking estimates and narratives around over coverage. 


[Week 6] Namaste India 🙏 | TTAN's Glittery Update and Earnings Workbook

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>The <a href="https://www.smartkarma.com/entities/hong-kong-hang-seng-index" target="_blank" data-smartkarma-citation="entities:22899:1" rel="noopener">HSI</a>, <a href="https://www.smartkarma.com/entities/hang-seng-china-enterprises-index" target="_blank" data-smartkarma-citation="entities:22900:1" rel="noopener">HSCEI</a>, <a href="https://www.smartkarma.com/entities/hang-seng-tech-index" target="_blank" data-smartkarma-citation="entities:31367:1" rel="noopener">HSTECH</a> and HSCI rebalances will take place at the close on 4 September since the market was closed on 1 September due to Typhoon Saola.</li>
<li>There will be a few announcements next week with <a href="https://www.smartkarma.com/entities/nikkei-225" target="_blank" data-smartkarma-citation="entities:22909:1" rel="noopener">Nikkei 225</a> early in the week and the MVIS series post close on Friday. Plus the <a href="https://www.smartkarma.com/entities/sse-science-and-technology-innovation-board-50-index" target="_blank" data-smartkarma-citation="entities:29279:1" rel="noopener">STAR50</a> rebalances on Friday.</li>
<li>Another week of huge inflows into mainland China ETFs focused on the <a href="https://www.smartkarma.com/entities/shanghai-shenzhen-csi-300-inde" target="_blank" data-smartkarma-citation="entities:22906:1" rel="noopener">CSI 300 Index</a>, <a href="https://www.smartkarma.com/entities/sse-science-and-technology-innovation-board-50-index" target="_blank" data-smartkarma-citation="entities:29279:1" rel="noopener">STAR50 INDEX</a> and <a href="https://www.smartkarma.com/entities/csi-smallcap-500-index-shang" target="_blank" data-smartkarma-citation="entities:35347:1" rel="noopener">CSI Smallcap 500 Index</a>.</li>
</ul>


The HSI, HSCEI, HSTECH and HSCI rebalances will take place at the close on 4 September since the market was closed on 1 September due to Typhoon Saola.
There will be a few announcements next week with Nikkei 225 early in the week and the MVIS series post close on Friday. Plus the STAR50 rebalances on Friday.
Another week of huge inflows into mainland China ETFs focused on the CSI 300 Index, STAR50 INDEX and CSI Smallcap 500 Index.


Index Rebalance & ETF Flow Recap: STAR50, KOSPI200, Hang Seng, MVIS, AMFI, Jio, China ETF

Event-Driven

<ul>
<li>We see 8 stocks moving from MidCap to LargeCap, 8 stocks moving from LargeCap to MidCap, 13 stocks from SmallCap to MidCap, and 13 stocks from MidCap to SmallCap.</li>
<li>The expected migrations from SmallCap to MidCap have outperformed the other potential migrations with all stocks moving higher over the last six month.</li>
<li>Active managers could continue to realign their portfolios. Some of the upward migrations will have passive flows in the next few days and over the next few months.</li>
</ul>


We see 8 stocks moving from MidCap to LargeCap, 8 stocks moving from LargeCap to MidCap, 13 stocks from SmallCap to MidCap, and 13 stocks from MidCap to SmallCap.
The expected migrations from SmallCap to MidCap have outperformed the other potential migrations with all stocks moving higher over the last six month.
Active managers could continue to realign their portfolios. Some of the upward migrations will have passive flows in the next few days and over the next few months.


AMFI Stock Reclassification Preview (Dec 2023): Overlap Between Active & Passive Flows

<div><p>The Indian mutual fund industry has assets of almost INR 6.6 trillion across Multi cap, Large Cap, Large and Mid Cap, Mid Cap, Small Cap and Flexi Cap equity schemes. Equity schemes classified as large cap need to have at least 80% of their assets invested in large cap stocks, large and mid cap schemes need to have at least 35% of their assets in large cap stocks and at least 35% in mid cap stocks, mid cap funds need to hold at least 65% of their assets in mid cap stocks, and small cap funds need to hold at least 65% of their assets in small cap stocks. Flexi cap funds can invest across market caps.</p></div><div>
<p>The Association of Mutual Funds in India (AMFI) publishes the list of the stocks in each market cap segment in January and July each year and mutual funds have one month to rebalance their portfolios to adhere to the new categorization.</p>
<p>At the next recategorization in July 2021, we see 7 stocks moving from the mid cap segment to the large cap segment with an equal number of stocks moving the other way, and 13 stocks are expected to move from the small cap segment to the mid cap segment with the 16 stocks moving from the mid cap to the small cap segment. There are 3 recent listings that will enter the mid cap segment with over 18 joining the small cap segment.</p>
<p>Historically, the stocks migrating upward to a higher market cap segment have outperformed stocks that migrate to a lower market cap segment over the 1 month and 2 month period post the publishing of the AMFI list. This can be attributed to fund managers realigning their portfolios to meet the new categorization. This provides opportunities to pre-position for the move and unwind post the announcement of the reclassification.</p>
</div>

The Indian mutual fund industry has assets of almost INR 6.6 trillion across Multi cap, Large Cap, Large and Mid Cap, Mid Cap, Small Cap and Flexi Cap equity schemes. Equity schemes classified as large cap need to have at least 80% of their assets invested in large cap stocks, large and mid cap schemes need to have at least 35% of their assets in large cap stocks and at least 35% in mid cap stocks, mid cap funds need to hold at least 65% of their assets in mid cap stocks, and small cap funds need to hold at least 65% of their assets in small cap stocks. Flexi cap funds can invest across market caps.
The Association of Mutual Funds in India (AMFI) publishes the list of the stocks in each market cap segment in January and July each year and mutual funds have one month to rebalance their portfolios to adhere to the new categorization.
At the next recategorization in July 2021, we see 7 stocks moving from the mid cap segment to the large cap segment with an equal number of stocks moving the other way, and 13 stocks are expected to move from the small cap segment to the mid cap segment with the 16 stocks moving from the mid cap to the small cap segment. There are 3 recent listings that will enter the mid cap segment with over 18 joining the small cap segment.
Historically, the stocks migrating upward to a higher market cap segment have outperformed stocks that migrate to a lower market cap segment over the 1 month and 2 month period post the publishing of the AMFI list. This can be attributed to fund managers realigning their portfolios to meet the new categorization. This provides opportunities to pre-position for the move and unwind post the announcement of the reclassification.


India: Stock Reclassification & Active Portfolio Management

Head of Research, IPOs & Placements, Aequitas Research

Sumeet Singh

Head of Research, IPOs & Placements

IPOs and Placements coverage across Asia Pacific

Aequitas Research

We cover all listing across the Asia Pacific along with follow-up placements. As of Dec 2020, our team had covered 539 IPOs with a hit rate of 73.5% and 685 placements with a hit rate of 66.8%.

We combine fundamental bottom-up views with our proprietary quantitative framework to provide a holistic coverage across new listings and placements. Our coverage includes pre-IPO notes before the deal is launched, follow-up analysis once the deal is live and post-listing trading analysis as well.

Equity Capital Markets

Kalyan Jewellers / Equity Capital Markets

<p>Kalyan Jewellers raise around US$160m via a mix of selling new and existing shares in its Indian IPO. The company was established in 1993 and is backed by Warburg Pincus.</p><p>We have looked at various aspects of the deal in our previous note, <a href="https://www.smartkarma.com/insights/kalyan-jewellers-pre-ipo-strategy-missteps-led-to-earnings-flatlining" target="_blank" rel="noopener">Kalyan Jewellers Pre-IPO - Strategy missteps led to earnings flatlining </a>and <a href="https://www.smartkarma.com/insights/kalyan-jewellers-ipo-no-glitter" target="_blank" rel="noopener">Kalyan Jewellers IPO - No Glitter</a>.</p><p>In this note, we'll talk about deal updates and provide a table with implied valuations at different share price levels.</p>

Kalyan Jewellers raise around US$160m via a mix of selling new and existing shares in its Indian IPO. The company was established in 1993 and is backed by Warburg Pincus.We have looked at various aspects of the deal in our previous note, Kalyan Jewellers Pre-IPO - Strategy missteps led to earnings flatlining and Kalyan Jewellers IPO - No Glitter.In this note, we'll talk about deal updates and provide a table with implied valuations at different share price levels.

Kalyan Jewellers IPO Trading - Subdued Demand

India

Kalyan Jewellers is an Indian multinational jewellery company that designs, manufactures, and sells a wide range of gold, diamond, silver, platinum, and gemstone jewellery. The company utilizes a hyperlocal strategy to cater to regional consumer preferences across its extensive network of showrooms and online platforms. It was founded in 1993 and is headquartered in Thrissur, Kerala, India.

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Kalyan Jewellers (KALYANKJ IN)

[Week 6] Namaste India 🙏 | TTAN's Glittery Update and Earnings Workbook

Bullish momentum may resume if NIFTY Index closes above 19,800. Names discussed Titan Co Ltd, Maruti Suzuki India, and Metro Brands. Earnings...

Pranav Bhavsar

Index Rebalance & ETF Flow Recap: STAR50, KOSPI200, Hang Seng, MVIS, AMFI, Jio, China ETF

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

Brian Freitas

AMFI Stock Reclassification Preview (Dec 2023): Overlap Between Active & Passive Flows

We see 42 potential migrations between the size categories. The small to mid migrations have outperformed. There will be a lot of overlap between...

Brian Freitas

India: Stock Reclassification & Active Portfolio Management

There are a lot of segment changes expected in July when AMFI recategorizes stocks and mutual funds start to rebalance their portfolios. We...

Brian Freitas

Kalyan Jewellers IPO Trading - Subdued Demand

Kalyan Jewellers raise around US$160m via a mix of selling new and existing shares in its Indian IPO. In this note, we'll talk about deal updates.

Sumeet Singh

Price Gauge

52-week Range

Market Cap (USDm)

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[Week 6] Namaste India 🙏 | TTAN's Glittery Update and Earnings Workbook

​Bullish momentum may resume if NIFTY Index closes above 19,800. Names discussed Titan Co Ltd, Maruti Suzuki India, and Metro Brands. Earnings...

Pranav Bhavsar

Index Rebalance & ETF Flow Recap: STAR50, KOSPI200, Hang Seng, MVIS, AMFI, Jio, China ETF

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

Brian Freitas

AMFI Stock Reclassification Preview (Dec 2023): Overlap Between Active & Passive Flows

We see 42 potential migrations between the size categories. The small to mid migrations have outperformed. There will be a lot of overlap between...

Brian Freitas

India: Stock Reclassification & Active Portfolio Management

There are a lot of segment changes expected in July when AMFI recategorizes stocks and mutual funds start to rebalance their portfolios. We...

Brian Freitas

Kalyan Jewellers IPO Trading - Subdued Demand

Kalyan Jewellers raise around US$160m via a mix of selling new and existing shares in its Indian IPO. In this note, we'll talk about deal updates.

Sumeet Singh

Bullish momentum may resume if NIFTY Index closes above 19,800. Names discussed Titan Co Ltd, Maruti Suzuki India, and Metro Brands. Earnings...