Value investor- India mid & small caps

Bhaskar Chakraborty

Thematic (Sector/Industry)

Since 1QFY18 was impacted by destocking owing to impending GST rollout and 2Q has been impacted by restocking, we decided to look at 1HFY18 performance for our discretionary universe. The following are the key takeaways-<ul><li>Consumer Durables- Supply chain least impacted by GST, reports stellar growth</li><li>Paints- Festive demand weaker than anticipated, inadequate price hikes to defray input cost inflation impact profitability.</li><li>Consumer electrical- Supply chain unorganized and heavily impacted by GST. Demand remains weak, inadequate price hikes to defray input cost inflation impact profitability.</li><li>Cooling products- Blue Star’s consumer business grew faster than Voltas’; project business profitability improves for both; Symphony recovers ground in 2Q.</li><li>Building materials- Supply chain unorganized and heavily impacted by GST, demand remains weak, inadequate price hikes to defray input cost inflation impact profitability.</li></ul>

Since 1QFY18 was impacted by destocking owing to impending GST rollout and 2Q has been impacted by restocking, we decided to look at 1HFY18 performance for our discretionary universe. The following are the key takeaways-Consumer Durables- Supply chain least impacted by GST, reports stellar growthPaints- Festive demand weaker than anticipated, inadequate price hikes to defray input cost inflation impact profitability.Consumer electrical- Supply chain unorganized and heavily impacted by GST. Demand remains weak, inadequate price hikes to defray input cost inflation impact profitability.Cooling products- Blue Star’s consumer business grew faster than Voltas’; project business profitability improves for both; Symphony recovers ground in 2Q.Building materials- Supply chain unorganized and heavily impacted by GST, demand remains weak, inadequate price hikes to defray input cost inflation impact profitability.

India Consumer Discretionary: Key Takeaways of 2QFY18 Results

<ul class=""><li>Consumer Durables- Excellent April and May drives beat.</li><li>Paints- De-stocking impacts volumes, GST’s anti-profiteering clause puts lid on near-term price hikes.</li><li>Consumer electrical- Severely impacted by channel de-stocking; restocking and price hikes will be gradual.</li><li>Footwear- Strong growth after a lackluster FY17 but margins hurt.</li></ul>

Consumer Durables- Excellent April and May drives beat.Paints- De-stocking impacts volumes, GST’s anti-profiteering clause puts lid on near-term price hikes.Consumer electrical- Severely impacted by channel de-stocking; restocking and price hikes will be gradual.Footwear- Strong growth after a lackluster FY17 but margins hurt.

India Consumer Discretionary: Key Takeaways from 1QFY18 Result (Part 1/2)

Asia focused research insights & advisory, Asia Advisors

Vinay Patel

Asia focused research insights & advisory

Asia Advisors

Asia Advisors is an independent financial advisory and research firm working closely with corporates and institutions to provide consulting solutions & research insights. We provide advisory services including capital solutions, business strategy and investment insights.
Firm is headed by Vinay Patel who has close to two decades of experience in research and business development at large, international investment banks such as HSBC and ICICI Securities. Led research efforts in areas of Macroeconomics, Asset Allocation & Investment Strategy for close to a decade in global & domestic research teams. As a business head in Singapore, advised top global investment management firms & Portfolio managers in Asia for India related investments.
Vinay was recently joined by Swapnil Manish, an investment banker and ex-ecommerce entrepreneur with more than 12 years of experience. Swapnil was the TMT banker at BNP Paribas and was part of several large M&A and ECM transactions (Bharti-Zain, Bharti Infratel IPO, Schneider-Zicom among several others). He's also had a stint as an ecommerce entrepreneur having launched & led Mumbai's first online grocery player.

Expectations on economic reforms from Modi government are running high after the big win in Uttar Pradesh. Political analysts are expecting this win to ease Modi's chances for another term at national elections in 2019 and that would give him total 7 year period to push for reforms (In his victory speech Modi himself said he is now looking for delivering by 2022 - the 75th year of Indian Independence). Amidst the euphoria of Modi's victory, we would like to highlight some of the ground realities…

Expectations on economic reforms from Modi government are running high after the big win in Uttar Pradesh. Political analysts are expecting this win to ease Modi's chances for another term at national elections in 2019 and that would give him total 7 year period to push for reforms (In his victory speech Modi himself said he is now looking for delivering by 2022 - the 75th year of Indian Independence). Amidst the euphoria of Modi's victory, we would like to highlight some of the ground realities…

Investors Need To Be Patient With Reform Momentum Even As Modi Win Ensures Policy Continuity

Ruling party BJP has won a landslide victory in the largest state of Uttar Pradesh (UP) thereby putting to rest any doubts over the adverse impact of demonetisation on the electoral prospects of the party. Performance in UP is impressive as the opposition had formed an alliance to fight Modi but still lost poorly.  Most political analysts have been caught on the wrong foot as they predicted a hung assembly while the results show that Modi wave seen during the General elections continues. We…

Ruling party BJP has won a landslide victory in the largest state of Uttar Pradesh (UP) thereby putting to rest any doubts over the adverse impact of demonetisation on the electoral prospects of the party. Performance in UP is impressive as the opposition had formed an alliance to fight Modi but still lost poorly.  Most political analysts have been caught on the wrong foot as they predicted a hung assembly while the results show that Modi wave seen during the General elections continues. We…

Landslide Win for Modi in UP Elections;Upper House No.s to Cross 100 Mark by 2018, a +ve for Reforms

In a surprise move, the Central bank (RBI) today maintained the policy rate at the current level of 6.25% but changed the monetary policy stance to neutral. The 6 member Monetary Policy Committee (MPC) was unanimous in its decision to hold rates. The consensus was again caught on the wrong foot as majority expected a rate cut. Key rationale behind the move has been the adoption of 4% inflation target for the next financial year (ending March 2018). Even as current CPI inflation at 3.4% is well…

In a surprise move, the Central bank (RBI) today maintained the policy rate at the current level of 6.25% but changed the monetary policy stance to neutral. The 6 member Monetary Policy Committee (MPC) was unanimous in its decision to hold rates. The consensus was again caught on the wrong foot as majority expected a rate cut. Key rationale behind the move has been the adoption of 4% inflation target for the next financial year (ending March 2018). Even as current CPI inflation at 3.4% is well…

RBI Spoils the Bond Market Party - Prices Unlikely to Scale the Peaks Seen After Demonetization

India

Berger Paints India Limited manufactures and distributes paints, enamels, varnishes, and synthetic resins. The Company's products are used in home, office, factory, interiors, exteriors, metal, wood, plastic, and others.

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Berger Paints India (BRGR IN)

India Consumer Discretionary: Key Takeaways of 2QFY18 Results

Since 1QFY18 was impacted by destocking owing to impending GST rollout and 2Q has been impacted by restocking, we decided to look at 1HFY18...

Bhaskar Chakraborty

India Consumer Discretionary: Key Takeaways from 1QFY18 Result (Part 1/2)

Consumer Durables- Excellent April and May drives beat. Paints- De-stocking impacts volumes, GST’s anti-profiteering clause puts lid on near-term...

Bhaskar Chakraborty

Investors Need To Be Patient With Reform Momentum Even As Modi Win Ensures Policy Continuity

Expectations on economic reforms from Modi government are running high after the big win in Uttar Pradesh. Political analysts are expecting this...

Asia Advisors

Landslide Win for Modi in UP Elections;Upper House No.s to Cross 100 Mark by 2018, a +ve for Reforms

Ruling party BJP has won a landslide victory in the largest state of Uttar Pradesh (UP) thereby putting to rest any doubts over the adverse impact...

Asia Advisors

RBI Spoils the Bond Market Party - Prices Unlikely to Scale the Peaks Seen After Demonetization

In a surprise move, the Central bank (RBI) today maintained the policy rate at the current level of 6.25% but changed the monetary policy stance to...

Asia Advisors

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