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 situation in West Bengal is improving/stable. While Assam is showing no signs of improvement</li>
<li>Recent floods have impacted collections, however, as highlighted earlier they are not likely to slip into NPA.</li>
<li>The asset quality downcycle could be on the verge of ending.  Additional provisioning requirements should be sharply lower from Q3. </li>
</ul>


The situation in West Bengal is improving/stable. While Assam is showing no signs of improvement
Recent floods have impacted collections, however, as highlighted earlier they are not likely to slip into NPA.
The asset quality downcycle could be on the verge of ending.  Additional provisioning requirements should be sharply lower from Q3. 


India Channel Insight #43 | Bandhan Bank - One More Quarter of Pain?

External broker reports(aggregated public sources), HDFC Securities

HDFC Securities

External broker reports(aggregated public sources)

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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.

Thematic (Sector/Industry)

<ul><li>UltraTech Cement: We maintain BUY on UltraTech (UTCEM) with an unchanged target price of INR 7,295 (16x Mar’24E consolidated EBITDA)</li><li>We continue to like the company for its strong growth and margin outlook and balance sheet management</li><li>UTCEM’s Q1FY23 consolidated EBITDA came in ~10/15% ahead of ours/consensus numbers</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.

UltraTech Cement: We maintain BUY on UltraTech (UTCEM) with an unchanged target price of INR 7,295 (16x Mar’24E consolidated EBITDA)We continue to like the company for its strong growth and margin outlook and balance sheet managementUTCEM’s Q1FY23 consolidated EBITDA came in ~10/15% ahead of ours/consensus numbersContent 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.

HSIE Results Daily: UltraTech Cement, SRF, Bandhan Bank, Mphasis

External broker reports(aggregated public sources), Nirmal Bang

Nirmal Bang

A Relationship Beyond Broking

Nirmal Bang, one of the leading stock broking companies in India, caters to retail and institutional clients by offering them a range of financial products and services, including equities, derivatives, commodities, currency derivatives, mutual funds, IPOs, insurance, depository services and PMS.

Nirmal Bang is drawn from a diversity of professional backgrounds, and blend of experience, skill and dedication is shared with its clients. Nirmal Bang emphasizes adequate, thorough research local and world-wide developments, balancing these with the astute discovery of intrinsic values, synergies and growth. The aim is simply to help the investors to maximize their returns.

<div><ul><li>Treasury losses to dent earnings: While we expect NII growth to be strong (up 16.9% YoY for coverage banks), treasury losses could be a major drag on operating profit growth.</li><li>Systemic credit growth, provisional updates indicate optimism: As per RBI’s latest data, systemic credit growth rate is 12% YoY (June’22).</li><li>Large cap banks showing stronger traction than peers; housing doing well: We expect large cap coverage banks to continue to report higher growth (20.7% YoY) vis-à-vis mid/small-cap peers (16.9% YoY) and PSBs (15.5% YoY).</li></ul></div>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.

Treasury losses to dent earnings: While we expect NII growth to be strong (up 16.9% YoY for coverage banks), treasury losses could be a major drag on operating profit growth.Systemic credit growth, provisional updates indicate optimism: As per RBI’s latest data, systemic credit growth rate is 12% YoY (June’22).Large cap banks showing stronger traction than peers; housing doing well: We expect large cap coverage banks to continue to report higher growth (20.7% YoY) vis-à-vis mid/small-cap peers (16.9% YoY) and PSBs (15.5% YoY).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.

Banking & Financials Sector - Weak Treasury to Dent Earnings

<ul>
<li>Our channels in Assam indicate a high impact of floods this year on the overall state economy. Normalcy is expected to take 4-5 months in order to be restored. </li>
<li>Despite the high impact, <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> may not see an increase in NPAs.</li>
<li>New recovery tools, changing regulations and customer mindsets are aiding faster than anticipated recovery even for older loans. </li>
</ul>


Our channels in Assam indicate a high impact of floods this year on the overall state economy. Normalcy is expected to take 4-5 months in order to be restored. 
Despite the high impact, Bandhan Bank Ltd (BANDHAN IN) may not see an increase in NPAs.
New recovery tools, changing regulations and customer mindsets are aiding faster than anticipated recovery even for older loans. 


India Channel Insight #40 | Assam Floods and Impact on Financials

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>Nearing the end of the review period, we see 5 stocks moving from MidCap to LargeCap, 2 new listings added to LargeCap and 7 stocks moving from LargeCap to MidCap.</li>
<li>We see 7 stocks moving from SmallCap to MidCap, 3 new listings added to MidCap, and 12 stocks moving from MidCap to SmallCap.</li>
<li>Stock migrating upward have, on average, outperformed stocks that are downward migrations. Stocks moving from MidCap to LargeCap have performed the best.</li>
</ul>


Nearing the end of the review period, we see 5 stocks moving from MidCap to LargeCap, 2 new listings added to LargeCap and 7 stocks moving from LargeCap to MidCap.
We see 7 stocks moving from SmallCap to MidCap, 3 new listings added to MidCap, and 12 stocks moving from MidCap to SmallCap.
Stock migrating upward have, on average, outperformed stocks that are downward migrations. Stocks moving from MidCap to LargeCap have performed the best.


India: AMFI Stock Reclassification Preview

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 #43 | Bandhan Bank - One More Quarter of Pain?

We speak to channels in West Bengal and Assam to gauge the sentiment and situation on the ground with the focus on EEB (microfinance) portfolio.

Pranav Bhavsar

HSIE Results Daily: UltraTech Cement, SRF, Bandhan Bank, Mphasis

UltraTech Cement: We maintain BUY on UltraTech (UTCEM) with an unchanged target price of INR 7,295 (16x Mar’24E consolidated EBITDA)

HDFC Securities

Banking & Financials Sector - Weak Treasury to Dent Earnings

We expect banks to report weak earnings due to treasury losses. We expect operating earnings of coverage banks to decline by 6.5% YoY and 11.2% QoQ...

Nirmal Bang

India Channel Insight #40 | Assam Floods and Impact on Financials

We speak to channels on the ground in Assam to understand the current flood situation and its likely impact on asset quality for financials.

Pranav Bhavsar

India: AMFI Stock Reclassification Preview

With 9 trading days to go in the review period, we see 5 stocks moving from Mid to Large and 7 stocks moving the other way. 2 new listings will be...

Brian Freitas

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