Equity Research
Does HDFC AMC deserve High Valuation ? ReviewApril 13, 2019
HDFC Asset Management Company – HDFC AMC has a strong brand pull (benefitting from parentage), relatively higher proportion of equity assets and continued delivery on fund performance make it one of the best plays to capitalize on the financial savings opportunity in the country.
Big Opportunity
MF AUM is just c.12% of GDP (vs global average of 62%). Long term AUM growth rates have been healthy (18% CAGR over last 19 years) and we see them sustaining in the future. Importantly, share of individual investors in the AUM has been inching up and the uptick in “sticky retail flows’ should shield the industry from cyclical whipsaws in the market. HDFCAMC is one of Read More »
October 3, 2017
Foreign Institutional Investors have been net sellers in the last two months offloading stocks worth about Rs 24,000 Cr [Aug & Sep] Source: NSDL. Domestic Investors have aggressively bought stocks to ward off free fall in the markets. To us it is a sure sign indication of downward revision of Earnings for FY 2018 from Rs 1626 to Rs 1601 and further down to Rs 1550 as we start getting the September quarter results.
Valuation of Indian Markets:
Instead of the BSE 500, we are now taking into Read More »
March 5, 2017
Indian small & midcap stocks have witnessed a sharp rally since the lows of Aug 2013 and have outperformed large caps significantly over this period. A large part of this relative outperformance is explained by the price multiple rerating seen over this period. While the price multiple rerating does explain a large part of equity returns in the short run, it is the underlying business performance and earnings growth that should drive performance in the long run.
In fact it’s quite interesting to note that for small stocks, the multiple Read More »
Indian Markets / Economy & Macro / Sector Research
Where is the Bottom for Market Sell Off ? Is it a Buying Opportunity ?September 30, 2016
News that Indian army conducted strikes across the Line of Control (LOC) between India and Pakistan, is on wires. This has pushed USD-INR higher by ~0.6%, equities lower by about 2% from intraday highs. While cross-border firing isn’t rare, attacks across the LOC are. Diplomatic tensions between the two countries have already been high following the attack on an Indian army camp in Uri on 18th September in which 18 Indian soldiers lost their lives and the exchange of words between India and Pakistan in the UN General Assembly recently. In fact, India Read More »
July 21, 2016
The Goods and Services Tax (GST) aims to simplify and unify India’s current indirect tax regime (by removing the complexity of multiple state/central taxes and a multitude of exemptions, and ensuring a seamless flow of input tax credit in the value chain), thus we believe that its implementation will be a game-changer for India. Apart from simplifying the indirect tax structure, the GST should help to create “One” India by eliminating geographical fragmentation. While the government has been trying to implement a GST for the past five-six years, it has never been so close. The constitutional Read More »
What are Various FIIs Views of Indian Equity in 2015-16 ?May 29, 2015
There is no doubt that India is in a Structural Multi Year Bull Run. One should not be too much worried about Bull Market Corrections as we have seen it happen 22 times at 10% in the last 10 years. In this backdrop, we’d like to summarize the views of various Foreign Investors who now own 25% of Indian Equity Market while Indians poured all their money in non-productive assets such as Gold & Real Estate.
BOFA Merrill remain positive on the Indian markets over next 6 to 9 months and expect an up-turn in consumption over the next 6 months on Read More »
Corporate Earnings News
Why Indian StockMarket Quoting at High P-E ?June 12, 2017
We already put out on Twitter that we are booking profits. As against the historical average multiple of 14.7x, the Nifty currently trades at 17.8x i.e, 20% premium. Over the last 10 years, the market has traded above this multiple for only 3% of
trading days.
Earnings growth trend also does not appear to be particularly attractive with earnings revisions still happening on the downside. Hence valuation Read More »
Can PSU Banks Catch Private Peers in Digital Banking ?
October 19, 2016
The increasing penetration of smartphones and internet availability on these phones coupled with Aadhaar have made onboarding of customers easy for new players and reduced switching cost and transaction time for customers. The stage is, therefore, set for a large scale disruption of the Financial Services industry, both on the liability gathering side (which will largely become cashless) and on the lending side (where loans will become more personalised and smaller).
Analysts are of the view that mobile wallets and payment banks might not be profitable on their own but would be successful as a part of a bigger ecosystem of services and financial services products. In specific, combining mobile wallets / Read More »
IPO Reviews
SEBI’s Regulation for OFS Against Retail Investors InterestJuly 31, 2015
The Securities and Exchange Board of India, SEBI the guardian for Investors across the board in Capital markets in India has devised & designed a severely flawed Offer For Sale [OFS] regulation against the Retail Indian Investors. On the very face of it you will probably think the author of this Article is Insane, but ask yourself how many shares did you get allotted in the recently concluded Power Finance Corporation OFS by the Government of India ?
The Govt of India to maximize its returns stopped announcing the OFS in advance as speculators would drive down the prices and also make a killing by virtue of Read More »
Wonderla Holidays – IPO Review / Recommendation
April 21, 2014
Wonderla Holidays Ltd (Wonderla), founded in 2002, is one of the largest amusement park operators in India promoted by the same promoters as that of V-Guard Industries Ltd. The company, currently, owns and operates two amusement parks under the brand name ‘Wonderla’. The company also owns and operates a resort besides an amusement park in Bengaluru under the brand name ‘Wonderla Resort’, which has been operational since March 2012.
Wonderla has a proven track record of managing amusement parks with established brand equity. The company has been able to maintain high standards of safety and hygiene, which has been able to attract organized visits from schools, colleges and corporate segment.
Wonderla has developed an in-house Read More »
Mutual Funds in India
What is Prashant Jain & Other HDFC Fund Manager’s Pay / Remuneration ?May 3, 2016
In Jan-2016, we decided to check on the remuneration the HDFC Mutual Fund Managers draw. However, our research met dead end due to non disclosure by the Asset Management Company. However, we took a wild guess on what could top Fund Manager Prashant Jain’s Pay. And we were Right in guessing the numbers 🙂
After heated discussion with SEBI, HDFC Mutual Fund and all other AMCs were forced to Disclose the Fund Manager’s Pay / Remuneration. Here is what HDFC AMC disclosed for FY 2015-16. All Figures in INR Lakhs for FY 2015-16
Milind Barve – 625.09 – He is the Managing Director of Read More »
Retail Indian Investors Back to Share Market via Mutual FundsJuly 14, 2015
The Retail Indian Investors is back into the Share Market after a gap of 6 years after their tryst with Real estate & Gold appeared to have given lesser returns than the Equities.
Increased participation of retail investors through Mutual Funds [MF] rather than direct equity purchases is an encouraging development as it is the Fund Managers job to manage your Hard Earned money at a cost of say around 2% which is worth it. Didn’t we Read More »
