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IndusInd Bank Performance above Expectations

April 17, 2014

IndusInd Bank PerformnceIndusind bank reported a strong growth of 29% YoY in PAT, driven by NII growth of 18% YoY and slower growth of 20% YoY in operating cost. Non-interest income growth was strong at 42% YoY, driven by core fee income, forex income and Investment banking fees.

Loan book grows healthy at 24% driven by working capital loans with the corporate loan book, reporting a growth of 38% YoY. CASA improves Read more

Implications of Sun Pharma’s Acquisition of Ranbaxy Labs

April 7, 2014

Ranbaxy Sun Pharma Deal AnalysisIndia’s Leading Generic Drug maker, Sun Pharma announced the $4.0 Bn acquisition of Troubled Ranbaxy Labs from Daiichi Sankyo of Japan. The all share swap merger will give 0.8 Shares of Sun Pharma for 1 Share of Ranbaxy after all the approvals.

Sun’s management has a successful track record of turning around distressed Read more

Motherson Sumi – Review – Long Term BUY on Correction

April 2, 2014

Motherson Sumi The MultibaggerMotherson Sumi Systems Ltd is a a joint venture of Sumitomo Wiring Systems of Japan and Motherson group of India, is a leading manufacturer of electrical and plastic parts for automobiles globally. It is a market leader for wiring harness in India with over65% share. In Europe it is one of the top three manufacturers for external rear view mirrors, car bumpers and dashboard etc. Currently India contributes 17% of revenue and bulk of its profit.

Motherson is expected to register a 20% CAGR in sales through FY20. Key drivers we see are: an increase in the value of plastic and electrical parts per car Read more

Which Industrial / Cement/ Auto / Financial Stocks to Own to Play Economic Recovery ?

April 1, 2014

With cyclical stocks in India having rallied in anticipation of an election induced acceleration in economic momentum and sentiment in the wake of Opinion Polls projecting most progressive Global Politician Narendra Modi Ji as the Prime Minister of India, we look at blue sky valuations for domestic cylicals. We use EV/Sales as our benchmark for manufacturing companies and P/BV for financials, inherently assuming that the profitability cycle mirrors the revenue cycle.

Industrial / Auto / Cement Stocks – Only 4 companies are trading Read more

FIIs Bullish on Indian Banks / Financial Sector

March 31, 2014

FIIS Bullish on Indian BanksThe optimism and hope of a stable Government coupled with macro-economic parameters has led to Foreign Institutional Investors shoring up Indian Equities. The strengthening of Indian rupee and confidence in the new RBI governor’s policies and outlook, receding macro concerns like CAD, lower inflation and fiscal deficit numbers. More importantly, they seem to be looking at the overall GEMS market and India looks far better than any of the other members in the BRICS – China has its own issues, especially the banking system, where no one seems to believe the numbers and most investors perceive stress is very high, Russia and Brazil are not favoured, and more importantly.

If there is any further rally after a favourable election verdict, a Read more

Congress’ NREGA Scam Led to High Inflation – How Modi will Create 10 Crore Jobs ?

March 28, 2014

How Congress Govt Killed Labour reformsEconomic Rsearchers have been able to establish definite co-relation between Congress Government’s flawed Policy and the Labour Market and thus its impact on the Inflation. Rural wages have been growing by 17% on average since FY07 and have outstripped urban wages. A number of government programs have supported this, including the NREGA (A Massive Scam as Shown on Satyamev Jayate) which provides 100 days of employment to a member of each rural family.

Economic Researchers have found evidence to support the hypothesis that inflation has been higher in states where NREGA has been implemented to a greater degree. Not only are Read more

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