Technical Analyst, Vermilion Research

Joe Jasper

Technical Analyst

Technical and Quantitative Research

Vermilion Research

Vermilion’s objective is to deliver timely, actionable, and unique technical research to professional investors through the application of our various technical indicators.

Our research strategists seek to highlight securities which we believe are at major inflection points, based on our various technical and quantitative indicators, and offer asymmetric risk/return profiles. Our unique research methodology, centered on relative strength, enables our strategists to deliver superior investment recommendations.

Our process begins by organizing the universe of actively traded stocks into discrete sectors, then into industry groups. We then apply our technical and quantitative tools to identify developing price trends. Once attractive trends are identified within a selected sector or group, we screen for individual stocks which we believe offer the best risk/reward profile. We provide a historical perspective that often reveals, through our long-term charts, how price patterns often repeat themselves over time.

Technical Analysis

<ul>
<li>The theme we have seen over the past four weeks is an increasing number of indexes reversing 4-10-month downtrends and/or breaking above important resistance levels, with no failed breakouts.</li>
<li>We continue to believe that global equities are going through a bottoming process, but the real test will come during the eventual pullback, which we believe we are now experiencing.</li>
<li>We are watching to see whether these breakout levels and important moving averages (e.g., 50-day MAs) will hold.</li>
</ul>


The theme we have seen over the past four weeks is an increasing number of indexes reversing 4-10-month downtrends and/or breaking above important resistance levels, with no failed breakouts.
We continue to believe that global equities are going through a bottoming process, but the real test will come during the eventual pullback, which we believe we are now experiencing.
We are watching to see whether these breakout levels and important moving averages (e.g., 50-day MAs) will hold.


Japan Among the Latest to Break Out; Buy Ideas in Growth/Cyclicals and Consumer Staples

Financials & FinTech research, Galliano’s Financials Research

Victor Galliano

Financials & FinTech research

Financials & FinTech, EM & Developed Markets

Galliano’s Financials Research

Galliano's Financials Research provides fundamental research in Emerging Markets financials, including FinTech, as well as financials in select Developed Markets.

The investment style applied is generally value oriented, although Growth At Reasonable Price (GARP) strategies can also be used where appropriate. 

Our investment research approach aim is often contrarian, looking to capitalise on overly sceptical or optimistic consensus views. In terms of valuation techniques, the focus is on PBV ratio to ROE, PE multiples and dividend yield, as well as the application of PEG ratios and, where appropriate, Sum of the Parts (SOTP) valuations.

Equity Bottom-Up

<ul>
<li>Our profitability and credit quality screens, in terms of credit quality metrics to end-June 2022, continued in a constructive vein, although pre-provision profitability trends were mixed</li>
<li>The key positive trend to end-June was the declining cost of risk, boosting post-provision profitability; nonetheless, the prospect of worsening delinquency could drive a reversal in NPA provision charges</li>
<li>We believe HDFC Bank can best face credit quality deterioration; optically cheap State Bank of India is exposed to higher provisioning needs, as is ICICI Bank</li>
</ul>


Our profitability and credit quality screens, in terms of credit quality metrics to end-June 2022, continued in a constructive vein, although pre-provision profitability trends were mixed
The key positive trend to end-June was the declining cost of risk, boosting post-provision profitability; nonetheless, the prospect of worsening delinquency could drive a reversal in NPA provision charges
We believe HDFC Bank can best face credit quality deterioration; optically cheap State Bank of India is exposed to higher provisioning needs, as is ICICI Bank


Indian Banks Screener: Credit Quality Turning?

Research and consultancy, Tabbush Report

Daniel Tabbush

Research and consultancy

Tabbush Report

We provide research and consultancy on Asian banks. Our focus is on what we call “Asian bank research, without the noise.” We are interested in the most critical swing-factors for banks, the NPL and credit cycle, and where we believe there is a gap between perception and reality. We often focus on the less studied components of bank financial statements.  Our research is highly thematic, sometimes examining unlisted banks and companies as a window on mainstream banks. 

Being independent allows us to look at smaller banks, often overlooked by others. Analysis of BIS bank guidelines in the context of Asia, is also a focal point, while we also analyze global banks operating in the region. We use what we believe is the most comprehensive, reliable financials database, SNL Financial. S&P Capital IQ augments our database, with corporate data and CEIC, with economics. 

Asian bank research, without the noise.

<ul>
<li>Typically net interest margins and loan volume are what matter most for banks</li>
<li>ICICI is showing strength in both core financial metrics, but also in credit costs</li>
<li>Of the large 3 banks in India, ICICI may continue to show the best marginal deltaCI</li>
</ul>


Typically net interest margins and loan volume are what matter most for banks
ICICI is showing strength in both core financial metrics, but also in credit costs
Of the large 3 banks in India, ICICI may continue to show the best marginal deltaCI


Specialist in Indian Banking and Economic Research

Hemindra Hazari

<ul>
<li>
<a href="https://www.smartkarma.com/entities/icici-bank-ltd" target="_blank" data-smartkarma-citation="entities:547:1" rel="noopener">ICICI Bank Ltd (ICICIBC IN)</a> &amp; <a href="https://www.smartkarma.com/entities/kotak-mahindra-bank-ltd" target="_blank" data-smartkarma-citation="entities:126:1" rel="noopener">Kotak Mahindra Bank (KMB IN)</a> actively covered by a large number of analysts</li>
<li>Significant issues of regulatory penalties on Kotak Bank subsidiary &amp; major theft in a currency chest of ICICI Bank. No clarification from both banks</li>
<li>Instead of demanding explanations from the banks during the 1Q concalls, media and analysts chose to remain silent</li>
</ul>



ICICI Bank Ltd (ICICIBC IN) &amp; Kotak Mahindra Bank (KMB IN) actively covered by a large number of analysts
Significant issues of regulatory penalties on Kotak Bank subsidiary &amp; major theft in a currency chest of ICICI Bank. No clarification from both banks
Instead of demanding explanations from the banks during the 1Q concalls, media and analysts chose to remain silent


ICICI Bank, KMB Q1 Conferences: Media and Analysts’ Silence Is Not Golden for Stakeholders

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>Reliance Industries: Our ADD rating on Reliance Industries (RIL) with a price target of INR 2,860/sh is premised on (1) recovery in the O2C businesses; (2) continued EBITDA growth in the digital business, driven by improvement in ARPU, subscriber addition, and new revenue streams; and (3) potential for further value unlocking in the digital and retail businesses. </li><li>Gross slippages, at 2.9%, were elevated on account of the KCC portfolio, but were offset by higher recoveries, reflecting in negligible credit costs (adjusted for contingent provisions)</li><li>Despite a 54bps sequential reduction in the stressed pool (restructured portfolio at 0.8%, BB &amp; below portfolio at 1.9%), ICICIBC’s move to build up its contingent provisioning (+10bps) appears counter-intuitive and raises questions on the possibility of emerging risk markers in the portfolio</li></ul><p><em>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.</em></p>

Reliance Industries: Our ADD rating on Reliance Industries (RIL) with a price target of INR 2,860/sh is premised on (1) recovery in the O2C businesses; (2) continued EBITDA growth in the digital business, driven by improvement in ARPU, subscriber addition, and new revenue streams; and (3) potential for further value unlocking in the digital and retail businesses. Gross slippages, at 2.9%, were elevated on account of the KCC portfolio, but were offset by higher recoveries, reflecting in negligible credit costs (adjusted for contingent provisions)Despite a 54bps sequential reduction in the stressed pool (restructured portfolio at 0.8%, BB &amp; below portfolio at 1.9%), ICICIBC’s move to build up its contingent provisioning (+10bps) appears counter-intuitive and raises questions on the possibility of emerging risk markers in the portfolioContent 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: Reliance Industries, ICICI Bank, Kotak Mahindra Bank

India

ICICI Bank Limited operates as a bank. The Bank offers saving accounts, loans, debit, credit cards, insurance, investments, mortgages, and online banking services. ICICI Bank serves customers worldwide.

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ICICI Bank Ltd (ICICIBC IN)

Japan Among the Latest to Break Out; Buy Ideas in Growth/Cyclicals and Consumer Staples

Japan is the latest major country to break out, and we are buyers. Japan continues to be considerably further along in the bottoming process...

Vermilion Research

Indian Banks Screener: Credit Quality Turning?

Indian bank showed broadly positive results to 1QFY23; yet we believe that the credit quality cycle may soon turn; rising delinquency will hit SBI...

Victor Galliano

India Banks - Solid Strength at ICICI

There are vast differences amongst the largest 3 banks in India, that favor ICICI. Margin expansion, LDR expansion, net interest income growth, and...

Daniel Tabbush

ICICI Bank, KMB Q1 Conferences: Media and Analysts’ Silence Is Not Golden for Stakeholders

When analysts refuse to probe banks based on facts what primary investigation or in-depth critical research can they undertake? A pack of guard...

Hemindra Hazari

HSIE Results Daily: Reliance Industries, ICICI Bank, Kotak Mahindra Bank

Gross slippages, at 2.9%, were elevated on account of the KCC portfolio, but were offset by higher recoveries, reflecting in negligible credit...

HDFC Securities

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