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>While the street is getting excited about Bandhan Bank (assuming a change in management, end of a bad asset cycle, and lower valuations), we are not.</li>
<li>We believe the next set of problems for the bank are yet to be unleashed, and a change in management will only intensify the challenges ahead.</li>
<li>We believe the worst is yet to come for the bank. </li>
</ul>


While the street is getting excited about Bandhan Bank (assuming a change in management, end of a bad asset cycle, and lower valuations), we are not.
We believe the next set of problems for the bank are yet to be unleashed, and a change in management will only intensify the challenges ahead.
We believe the worst is yet to come for the bank. 


India Channel Insight | Bandhan Bank (BANDHAN IN) | The Other Shoe to Drop

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

Event-Driven

<ul>
<li>Despite the recent rally in <a href="https://www.smartkarma.com/entities/bandhan-bank-ltd" target="_blank" data-smartkarma-citation="entities:26705:1" rel="noopener">Bandhan Bank Ltd (BANDHAN IN)</a>, the stock should be deleted from the <a href="https://www.smartkarma.com/entities/nse-nifty-bank-index" target="_blank" data-smartkarma-citation="entities:26811:1" rel="noopener">NSE Nifty Bank Index (NSEBANK INDEX)</a> in September.</li>
<li>
<a href="https://www.smartkarma.com/entities/canara-bank" target="_blank" data-smartkarma-citation="entities:543:1" rel="noopener">Canara Bank (CBK IN)</a> should be added to the <a href="https://www.smartkarma.com/entities/nse-nifty-bank-index" target="_blank" data-smartkarma-citation="entities:26811:1" rel="noopener">NSE Nifty Bank Index (NSEBANK INDEX)</a> and passive trackers will need to buy 1x ADV and over 2x delivery volume.</li>
<li>
<a href="https://www.smartkarma.com/entities/bandhan-bank-ltd" target="_blank" data-smartkarma-citation="entities:26705:1" rel="noopener">Bandhan Bank Ltd (BANDHAN IN)</a> is safe for now but could be deleted from a large global index in the next few months on further underperformance.</li>
</ul>


Despite the recent rally in Bandhan Bank Ltd (BANDHAN IN), the stock should be deleted from the NSE Nifty Bank Index (NSEBANK INDEX) in September.

Canara Bank (CBK IN) should be added to the NSE Nifty Bank Index (NSEBANK INDEX) and passive trackers will need to buy 1x ADV and over 2x delivery volume.

Bandhan Bank Ltd (BANDHAN IN) is safe for now but could be deleted from a large global index in the next few months on further underperformance.


NIFTY Bank Index Rebalance Preview: Canara Bank Should Replace Bandhan Bank

India BFSI - Long-Short - Equity Research Analyst

Raj S, CA, CFA

Artoval Advisors

Art’o’val stands for Art of Valuation. Artoval Advisors LLP is a professionally run advisory firm catering to various financial advisory services including Valuation, Investment Research, Training, Accounting, CFO Services and other ancillary services.

We are passionate about what we do and strongly believe in working with our clients as their extended teams. With Artoval Advisors as their trusted partner, our clients find it easy to achieve efficiency in service delivery without compromising on quality.

True Art of Valuation

<ul>
<li>
<a href="https://www.smartkarma.com/entities/bandhan-bank-ltd" target="_blank" data-smartkarma-citation="entities:26705:1" rel="noopener">Bandhan Bank Ltd (BANDHAN IN)</a> has been an underperformer among Indian banks since the start of the COVID-19 pandemic due to asset quality issues in its core Group Microfinance portfolio.</li>
<li>Bandhan Bank’s leading position in the microfinance sector, strong operating margins, strategic de-risking, self-sustaining capital base, and cheap relative valuations make it a value bet with strong positive re-rating potential.
</li>
<li>
We value Bandhan Bank at 2.1x FY25e P/B in the base case, implying a 44% upside. On the other hand, we also discuss the risks to the thesis in detail.</li>
</ul>



Bandhan Bank Ltd (BANDHAN IN) has been an underperformer among Indian banks since the start of the COVID-19 pandemic due to asset quality issues in its core Group Microfinance portfolio.
Bandhan Bank’s leading position in the microfinance sector, strong operating margins, strategic de-risking, self-sustaining capital base, and cheap relative valuations make it a value bet with strong positive re-rating potential.


We value Bandhan Bank at 2.1x FY25e P/B in the base case, implying a 44% upside. On the other hand, we also discuss the risks to the thesis in detail.


Bandhan Bank: Initiating Coverage – Heads Up, Strong Re-Rating Ahead.

<ul>
<li>
<a href="https://www.smartkarma.com/entities/canara-bank" target="_blank" data-smartkarma-citation="entities:543:1" rel="noopener">Canara Bank (CBK IN)</a> should replace <a href="https://www.smartkarma.com/entities/bandhan-bank-ltd" target="_blank" data-smartkarma-citation="entities:26705:1" rel="noopener">Bandhan Bank Ltd (BANDHAN IN)</a> in the <a href="https://www.smartkarma.com/entities/nse-nifty-bank-index" target="_blank" data-smartkarma-citation="entities:26811:1" rel="noopener">NSE Nifty Bank Index (NSEBANK INDEX)</a> at the September rebalance.</li>
<li>Passive trackers will need to buy nearly 2 days of ADV in <a href="https://www.smartkarma.com/entities/canara-bank" target="_blank" data-smartkarma-citation="entities:543:1" rel="noopener">Canara Bank (CBK IN)</a> while selling over 1 day of ADV in <a href="https://www.smartkarma.com/entities/bandhan-bank-ltd" target="_blank" data-smartkarma-citation="entities:26705:1" rel="noopener">Bandhan Bank Ltd (BANDHAN IN)</a>. </li>
<li>
<a href="https://www.smartkarma.com/entities/canara-bank" target="_blank" data-smartkarma-citation="entities:543:1" rel="noopener">Canara Bank (CBK IN)</a> is one of the best performing banking stocks while <a href="https://www.smartkarma.com/entities/bandhan-bank-ltd" target="_blank" data-smartkarma-citation="entities:26705:1" rel="noopener">Bandhan Bank Ltd (BANDHAN IN)</a> has been the worst performer over the last two years.</li>
</ul>



Canara Bank (CBK IN) should replace Bandhan Bank Ltd (BANDHAN IN) in the NSE Nifty Bank Index (NSEBANK INDEX) at the September rebalance.
Passive trackers will need to buy nearly 2 days of ADV in Canara Bank (CBK IN) while selling over 1 day of ADV in Bandhan Bank Ltd (BANDHAN IN). 

Canara Bank (CBK IN) is one of the best performing banking stocks while Bandhan Bank Ltd (BANDHAN IN) has been the worst performer over the last two years.


NIFTY Bank Index Rebalance Preview: Canara Bank Still Cheap; Double Deletion for Bandhan?

External broker reports(aggregated public sources), Axis Direct

Axis Direct

External broker reports(aggregated public sources)

Axis Direct is the flagship brand under Axis Securities Limited, a subsidiary of Axis Bank in India. 

Content available is external broker reports authored by a third party outside the Smartkarma network and has been aggregated by an online aggregator through publicly available sources and is displayed by Smartkarma in this format for user's convenience and general informational purposes only. Content does not constitute investment or financial advice and Smartkarma makes no representation or warranty regarding its accuracy or contents. Original third party author retains all copyright and other proprietary rights in the content. Access or use of third party links not controlled by Smartkarma are at the user's own risk.

<ul><li>Mr Chandra Shekhar Ghosh has resigned from the post of MD &amp; CEO of the bank with the intent to retire and assume a more strategic role at Bandhan HoldCo. level.</li><li>This development comes shortly after the board had recently approved the extension of Mr Ghosh’s term as MD CEO for another 3 years in Nov’23.</li><li>The bank has set up an internal search committee to identify a new MD CEO.</li></ul>Content is external broker report sourced from online content aggregator through publicly available sources and is displayed below for general informational purposes only. Refer full disclaimer below.

Mr Chandra Shekhar Ghosh has resigned from the post of MD &amp; CEO of the bank with the intent to retire and assume a more strategic role at Bandhan HoldCo. level.This development comes shortly after the board had recently approved the extension of Mr Ghosh’s term as MD CEO for another 3 years in Nov’23.The bank has set up an internal search committee to identify a new MD CEO.Content is external broker report sourced from online content aggregator through publicly available sources and is displayed below for general informational purposes only. Refer full disclaimer below.

Bandhan Bank Ltd - MD CEO’s Resignation Raises Concerns on Future Prospects!

India

Bandhan Bank Limited operates as a commercial bank. The Bank provides accounts checking, savings deposits, money market, mortgage, and term loans services, as well as card facilities and Internet banking services. Bandhan Bank serves customers in India.

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Bandhan Bank Ltd (BANDHAN IN)

India Channel Insight | Bandhan Bank (BANDHAN IN) | The Other Shoe to Drop

Despite the optimism surrounding Bandhan Bank's potential turnaround, we remain skeptical as we foresee more challenges ahead, especially with a...

Pranav Bhavsar

NIFTY Bank Index Rebalance Preview: Canara Bank Should Replace Bandhan Bank

Canara Bank should replace Bandhan Bank in the NSEBANK Index in September. Canara Bank trades cheaper than its peers. Bandhan could be deleted from...

Brian Freitas

Bandhan Bank: Initiating Coverage – Heads Up, Strong Re-Rating Ahead.

Bandhan Bank’s "turnaround story" with leading market position, strong operating margins, strategic de-risking, strong capital base, and cheap...

Raj S, CA, CFA

NIFTY Bank Index Rebalance Preview: Canara Bank Still Cheap; Double Deletion for Bandhan?

Canara Bank should replace Bandhan Bank in the Nifty Bank Index in Sept. Canara Bank still trades cheaper than its peers. Bandhan's recent price...

Brian Freitas

Bandhan Bank Ltd - MD CEO’s Resignation Raises Concerns on Future Prospects!

Mr Chandra Shekhar Ghosh has resigned from the post of MD & CEO of the bank with the intent to retire and assume a more strategic role at Bandhan...

Axis Direct

Price Gauge

52-week Range

Market Cap (USDm)

P/E

Dividend (Yield)

India Channel Insight | Bandhan Bank (BANDHAN IN) | The Other Shoe to Drop

​Despite the optimism surrounding Bandhan Bank's potential turnaround, we remain skeptical as we foresee more challenges ahead, especially with a...

Pranav Bhavsar

NIFTY Bank Index Rebalance Preview: Canara Bank Should Replace Bandhan Bank

Canara Bank should replace Bandhan Bank in the NSEBANK Index in September. Canara Bank trades cheaper than its peers. Bandhan could be deleted from...

Brian Freitas

Bandhan Bank: Initiating Coverage – Heads Up, Strong Re-Rating Ahead.

Bandhan Bank’s "turnaround story" with leading market position, strong operating margins, strategic de-risking, strong capital base, and cheap...

Raj S, CA, CFA

NIFTY Bank Index Rebalance Preview: Canara Bank Still Cheap; Double Deletion for Bandhan?

Canara Bank should replace Bandhan Bank in the Nifty Bank Index in Sept. Canara Bank still trades cheaper than its peers. Bandhan's recent price...

Brian Freitas

Bandhan Bank Ltd - MD CEO’s Resignation Raises Concerns on Future Prospects!

Mr Chandra Shekhar Ghosh has resigned from the post of MD & CEO of the bank with the intent to retire and assume a more strategic role at Bandhan...

Axis Direct

Despite the optimism surrounding Bandhan Bank's potential turnaround, we remain skeptical as we foresee more challenges ahead, especially with a...