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?

<ul>
<li>The upcoming earnings season, along with the forthcoming Budget and Elections, should all contribute to keeping the undertone bullish for 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>
<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> reported a minor dip in collections for the non-EEB portfolio, which has probably spooked the street.</li>
<li>Other names discussed include MMFS, POONAWAL, AUBANK, LTFH, and AAVAS.</li>
</ul>


The upcoming earnings season, along with the forthcoming Budget and Elections, should all contribute to keeping the undertone bullish for the NIFTY Index (NIFTY INDEX). 

Bandhan Bank Ltd (BANDHAN IN) reported a minor dip in collections for the non-EEB portfolio, which has probably spooked the street.
Other names discussed include MMFS, POONAWAL, AUBANK, LTFH, and AAVAS.


[Week 16] Namaste India 🙏 | More Smoke for Bandhan?

India

Punjab & Sind Bank is a commercial bank. The Bank offers its customers a wide range of banking products and services.

PNB Housing Finance Ltd. (PNBHFL) provides lending services. The Company offers housing loans to individuals and corporate bodies for construction, purchase, repair, and upgradation of houses, as well as loans for commercial space, loan against property, and loan for purchase of residential plots. PNBHFL serves customers in India.

Federal Bank Limited operates branches and regional offices throughout India. The Bank offers a wide range of financial services, including merchant banking, international banking and foreign exchange, leasing facilities, money markets and agricultural advances. The Bank also provides lending for hi-tech agricultural and government sponsored schemes.

Bank of Maharashtra Ltd. provides a full range of banking services throughout India. The Group's activities include retail banking, commercial and personal banking, investment management, treasury & NRI services, cash management and assorted ATM facilities. Bank of Maharashtra also sponsors regional rural banks jointly with the Central Government and State Government.

Karur Vysya Bank Ltd. provides a full range of commercial banking services for retail and institutional customers. The Bank offers mutual funds, insurance, personal loan, fixed deposits, internet banking, gold and silver, lockers, credit cards, and agricultural finance. Karur Vysya Bank serves customers throughout India.

RBL Bank Limited operates as a commercial bank. The Company offers banking products and services such as savings accounts, fixed deposits, personal and business loans, debit and credit cards, insurance, investment management, and mobile banking. RBL Bank serves customers throughout India.

AU Small Finance Bank Limited operates as a commercial bank. The Bank offers financial products and services such as savings and current accounts, term deposits, debit cards, insurance, government banking, retail loans, and microfinance lending. AU Small Finance Bank serves customers in India.

AU Small Finance Bank Limited (AUBANK IN)

Ujjivan Small Finance Bank Limited operates as a bank. The Company offers various types of financial services such as saving account, deposits, loans, and insurance solutions. Ujjivan Small Finance Bank serves customers in India.

Ujjivan Small Finance Bank  (UJJIVANS IN)

The Jammu & Kashmir Bank Limited provides banking services, including CD's, educational loans, housing loans and car loans.  The Bank also provides insurance services through a joint venture with MetLife India Insurance Company. The Group has about 475 branches throughout India.

City Union Bank Ltd. is a full service bank. The Bank offers a wide range of banking and financial services across India, including both domestic and International banking services.

Atlantic Union Bankshares Corporation provides banking services. The Bank checking accounts, lending, credit cards, online and mobile banking, and wealth and treasury management services. Atlantic Union Bankshares serves customers in the United States.

International Bancshares Corporation, through its bank subsidiaries, provides commercial and retail banking services through offices in south and southeast Texas.  The Bank accepts deposits from the general public and uses those funds to make a variety of loans.

Fulton Financial Corporation is a multi-bank holding company. The Banks offer a full range of general retail and commercial banking services, including deposits, loans, equipment leasing and financing, and credit cards. Fulton operates in Pennsylvania, Maryland, Delaware, and New Jersey.

The Bank of East Asia, Limited and its subsidiaries provide general banking, related financial, business corporate, and investor services.

Huishang Bank Corporation Limited is a commercial bank. The Bank provides banking services including loans, money market operations, treasury business, investment and trading services, and valet transactions.

Taichung Commercial Bank conducts commercial banking and trust business.  The Bank accepts deposits, offers loans, as well as  invests in bonds and stocks. Taichung Commercial Banks provides bills and notes discounting, draft endorsement, domestic remittance, guarantee, and securities underwriting and brokerage services.

The Bank of Kyoto, Ltd. is a regional bank in Kyoto.  The Bank provides banking services including deposits, savings, loans, foreign exchange transactions, and securities investments.  The Bank of Kyoto also provides financial services such as letter of credit, leasing, loans, and credit cards.

Hong Leong Financial Group Berhad is a banking and financial services holding company. The Company provides a range of services including commercial and consumer banking, investment banking, and insurance broking. Through its subsidiaries, Hong Leong Financial underwrites life/general insurance, provides funds management, corporate advisory, and stock and share broking services.

Ameris Bancorp is a multi-bank holding company. The Banks provide a broad range of retail and commercial banking services to its customers, including checking and savings deposits, commercial and consumer loans, trust services, discount brokerage services, and electronic funds transfer services. Ameris Bancorp operates in Georgia, Florida, and Alabama.

United Community Banks, Inc. is a multi-bank holding company with locations throughout north Georgia and western North Carolina.  The Banks are community oriented and offer retail and corporate banking services including checking, savings, and time deposit accounts, secured and unsecured loans, wire transfers, trust services, and rental of safe deposit boxes.

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

[Week 16] Namaste India 🙏 | More Smoke for Bandhan?

The upcoming earnings season, Budget, and Elections are expected to keep the NIFTY Index bullish. Bandhan Bank's dip in collections for non-EEB...

Pranav Bhavsar

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

[Week 16] Namaste India 🙏 | More Smoke for Bandhan?

​The upcoming earnings season, Budget, and Elections are expected to keep the NIFTY Index bullish. Bandhan Bank's dip in collections for non-EEB...

Pranav Bhavsar

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

The upcoming earnings season, Budget, and Elections are expected to keep the NIFTY Index bullish. Bandhan Bank's dip in collections for non-EEB...