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>We are starting to see early signs of a potential bottom on MSCI EM (EEM-US).</li>
<li>Specifically, the EEM-US has reversed topside its 6-month downtrend. If MSCI EM has indeed bottomed, we want to be buying the leaders; that is where this report comes in.</li>
<li>Specific themes include attractive opportunities in India and Thailand, and also many in Taiwan and South Korea. Attractive Sectors include Energy, Financials, Materials, and Industrials.</li>
</ul>


We are starting to see early signs of a potential bottom on MSCI EM (EEM-US).
Specifically, the EEM-US has reversed topside its 6-month downtrend. If MSCI EM has indeed bottomed, we want to be buying the leaders; that is where this report comes in.
Specific themes include attractive opportunities in India and Thailand, and also many in Taiwan and South Korea. Attractive Sectors include Energy, Financials, Materials, and Industrials.


Finding Leadership Within Emerging Markets

External broker reports(aggregated public sources), HDFC Securities

HDFC Securities

External broker reports(aggregated public sources)

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Thematic (Sector/Industry)

<ul><li>Wipro: Wipro’s (WPRO IN) margin goalpost timelines have moved ahead with investments to ‘maintain’ the current growth trajectory</li><li>Q1 performance was a slightly lower revenue (although consistent at mid-point of the guided band) and delivered lower margins</li><li>Key positives include: (1) strong large deal bookings with 18 large deals of TCV USD 1.1bn (vs</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>

Wipro: Wipro’s (WPRO IN) margin goalpost timelines have moved ahead with investments to ‘maintain’ the current growth trajectoryQ1 performance was a slightly lower revenue (although consistent at mid-point of the guided band) and delivered lower marginsKey positives include: (1) strong large deal bookings with 18 large deals of TCV USD 1.1bn (vsContent 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: Wipro, IndusInd Bank, AU Small Finance Bank

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><p>Systemic credit growth, provisional updates indicate optimism: As per RBI’s latest data, systemic credit growth rate is 12% YoY (June’22).</p></li><li><p><span style="font-size: var(--content-font-size);">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).</span></p></li></ul></div><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>

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

<div><div><div><ul><li>Accelerated rate hike; more in the offing: In its response to a stubborn and elevated inflation print, the RBI has now effected an accelerated cumulative 90bps repo rate hike over the past few weeks.</li><li>Near-total pass-through a surprise; near-term margin-accretive: Unlike earlier up-cycles in the past, the sharp pace of rate normalisation is margin- accretive for banks in the near-term, especially given early-stage monetary transmission.</li></ul></div><div><div><div><ul><li>MCLR transmission to significantly lag EBLR transmission: At a system- wide level, ~20-30% of the aggregate loans are currently anchored to MCLR while 40% of the loans are anchored to EBLR.</li></ul></div></div></div></div></div><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>

Accelerated rate hike; more in the offing: In its response to a stubborn and elevated inflation print, the RBI has now effected an accelerated cumulative 90bps repo rate hike over the past few weeks.Near-total pass-through a surprise; near-term margin-accretive: Unlike earlier up-cycles in the past, the sharp pace of rate normalisation is margin- accretive for banks in the near-term, especially given early-stage monetary transmission.MCLR transmission to significantly lag EBLR transmission: At a system- wide level, ~20-30% of the aggregate loans are currently anchored to MCLR while 40% of the loans are anchored to EBLR.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.

BFSI - Sector Update - New Normal Rate Cycle; Brace for Transmission Effects

Equity Bottom-Up

<div><div><div><ul><li>Credit growth remains soft; C/D ratio sub-par: IIB reported a slight miss on NII (+13% YoY) and PPOP (+8% YoY), due to softer loan growth (12% YoY), resulting in a low CD ratio casting an overhang on margins.</li></ul><div><div><div><ul><li>Asset quality pain persists: IIB saw marginally lower gross (3.7%) and net slippages (0.6%) across portfolios, including a reduction in the restructured book at 2.6% (-70bps QoQ).</li></ul><div><div><div><ul><li>Limited levers to accelerate earnings; maintain REDUCE: With growth still reverting in only select segments and stress persisting (more than peers), portfolio stability appears distant.</li></ul></div></div></div></div></div></div></div></div></div><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>

Credit growth remains soft; C/D ratio sub-par: IIB reported a slight miss on NII (+13% YoY) and PPOP (+8% YoY), due to softer loan growth (12% YoY), resulting in a low CD ratio casting an overhang on margins.Asset quality pain persists: IIB saw marginally lower gross (3.7%) and net slippages (0.6%) across portfolios, including a reduction in the restructured book at 2.6% (-70bps QoQ).Limited levers to accelerate earnings; maintain REDUCE: With growth still reverting in only select segments and stress persisting (more than peers), portfolio stability appears distant.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.

IndusInd Bank - Portfolio Stability Continues to Be Elusive

India

IndusInd Bank Limited is a Mumbai-based Indian new generation bank established in 1994. The Bank provides a range of banking and financial services including  wholesale banking, credit monitoring, risk management, tele-banking, investment banking and commercial lending. IndusInd Bank operates branches throughout India as well as an office in Dubai and London.

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Indusind Bank (IIB IN)

Finding Leadership Within Emerging Markets

We are starting to see early signs of a potential bottom on $EEM. Specifically, the EEM has reversed topside its 6-month downtrend. If EEM has...

Vermilion Research

HSIE Results Daily: Wipro, IndusInd Bank, AU Small Finance Bank

Wipro: Wipro’s (WPRO IN) margin goalpost timelines have moved ahead with investments to ‘maintain’ the current growth trajectory

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

BFSI - Sector Update - New Normal Rate Cycle; Brace for Transmission Effects

Signalling its serious intent to rein in a galloping inflation, the RBI announced a 50bps repo rate hike in its monetary policy meeting

HDFC Securities

IndusInd Bank - Portfolio Stability Continues to Be Elusive

IndusInd Bank (IIB) reported a 5% miss on earnings estimates due to a higher- than-expected credit cost and soft loan growth.

HDFC Securities

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