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

Thematic (Sector/Industry)

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<li>This insight provides select Industry-wise highlights from the 59 checks, across 5 sectors and 14 industries that we did in Q4 (Jan 2022 to March 2022).</li>
<li>The objective of the checks is to understand the underlying business narrative not to forecast the coming quarter and hence the limited sample sizes. </li>
<li>These checks are used as a tool to identify areas of discrepancy between management commentary and ground reality that could be the subject of future deeper dives. </li>
</ul>


This insight provides select Industry-wise highlights from the 59 checks, across 5 sectors and 14 industries that we did in Q4 (Jan 2022 to March 2022).
The objective of the checks is to understand the underlying business narrative not to forecast the coming quarter and hence the limited sample sizes. 
These checks are used as a tool to identify areas of discrepancy between management commentary and ground reality that could be the subject of future deeper dives. 


India Channel Insight | Q4 Report Card | 59 Checks Across 5 Sectors

<h3>About The Narrative</h3>
<p>Earnings conference calls are important sources that aid us in the identification of potential catalysts and drivers of stock returns. Every quarter we go through these transcripts and connect them with primary research with the objective of assessing on-ground reality against management commentary. </p>
<p>The edition focuses on key quotes from the earnings transcripts of <a href="https://www.smartkarma.com/entities/hindustan-unilever-ltd" target="_blank" data-smartkarma-citation="entities:13828:1" rel="noopener">Hindustan Unilever (HUVR IN)</a> / <a href="https://www.smartkarma.com/entities/marico-ltd" target="_blank" data-smartkarma-citation="entities:16903:1" rel="noopener">Marico Ltd (MRCO IN)</a> / <a href="https://www.smartkarma.com/entities/dabur-india-ltd" target="_blank" data-smartkarma-citation="entities:242:1" rel="noopener">Dabur India Ltd (DABUR IN)</a> / <a href="https://www.smartkarma.com/entities/britannia-industries-ltd" target="_blank" data-smartkarma-citation="entities:16495:1" rel="noopener">Britannia Industries (BRIT IN)</a> / <a href="https://www.smartkarma.com/entities/zydus-wellness-ltd" target="_blank" data-smartkarma-citation="entities:4353:1" rel="noopener">Zydus Wellness (ZYWL IN)</a> </p>
<p>We have separated the quotes to highlight<em><strong> Business Performance, Operating Environment, Commodity Inflation and Margins, Competition, Pricing, Direct to Consumer / E-commerce, Channel and GTM and Outlook.</strong></em></p>

About The Narrative
Earnings conference calls are important sources that aid us in the identification of potential catalysts and drivers of stock returns. Every quarter we go through these transcripts and connect them with primary research with the objective of assessing on-ground reality against management commentary. 
The edition focuses on key quotes from the earnings transcripts of Hindustan Unilever (HUVR IN) / Marico Ltd (MRCO IN) / Dabur India Ltd (DABUR IN) / Britannia Industries (BRIT IN) / Zydus Wellness (ZYWL IN) 
We have separated the quotes to highlight Business Performance, Operating Environment, Commodity Inflation and Margins, Competition, Pricing, Direct to Consumer / E-commerce, Channel and GTM and Outlook.

The Narrative | Q2 FY22 | India Staples -  Hindustan Unilever, Marico, Dabur, Britannia, Zydus Well

Pan-Asia Index Rebalances/ Events/ Delta One, Periscope Analytics

Brian Freitas

Pan-Asia Index Rebalances/ Events/ Delta One

Event-Driven

<p>The Indian mutual fund industry has assets of almost INR 7.93 trillion (US$106.3bn) across Multi cap, Large Cap, Large and Mid Cap, Mid Cap, Small Cap and Flexi Cap equity schemes. Equity schemes classified as large cap need to have at least 80% of their assets invested in large cap stocks, large and mid cap schemes need to have at least 35% of their assets in large cap stocks and at least 35% in mid cap stocks, mid cap funds need to hold at least 65% of their assets in mid cap stocks, and small cap funds need to hold at least 65% of their assets in small cap stocks. Flexi cap funds can invest across market caps.</p><p>The Association of Mutual Funds in India (AMFI) publishes the list of the stocks in each market cap segment in January and July each year and mutual funds have one month to rebalance their portfolios to adhere to the new categorization.</p><p>We are just past halfway through the review period for the second half of 2021. Using data to the close on 4 October, at the next recategorization in January 2022, we see 10 stocks moving from the mid cap segment to the large cap segment, 11 stocks moving from the large cap segment to the mid cap segment , 11 stocks are expected to move from the small cap segment to the mid cap segment, with16 stocks moving from the mid cap to the small cap segment. <a href="https://www.smartkarma.com/entities/zomato-media-pvt" target="_blank" data-smartkarma-citation="entities:28820:1" rel="noopener">Zomato (ZOMATO IN)</a> will be a part of the large cap universe, while 4 other newly listed stocks will be a part of the mid cap universe.</p><p>Historically, stocks moving to a higher market cap category have outperformed stocks that migrate to a lower market cap category over the back half of the review period. In some cases, the outperformance continues past the announcement of the changes as well. This can be attributed to fund managers realigning their portfolios to meet the new categorization. This provides opportunities to pre-position for the move and unwind post the announcement of the reclassification.</p>

The Indian mutual fund industry has assets of almost INR 7.93 trillion (US$106.3bn) across Multi cap, Large Cap, Large and Mid Cap, Mid Cap, Small Cap and Flexi Cap equity schemes. Equity schemes classified as large cap need to have at least 80% of their assets invested in large cap stocks, large and mid cap schemes need to have at least 35% of their assets in large cap stocks and at least 35% in mid cap stocks, mid cap funds need to hold at least 65% of their assets in mid cap stocks, and small cap funds need to hold at least 65% of their assets in small cap stocks. Flexi cap funds can invest across market caps.The Association of Mutual Funds in India (AMFI) publishes the list of the stocks in each market cap segment in January and July each year and mutual funds have one month to rebalance their portfolios to adhere to the new categorization.We are just past halfway through the review period for the second half of 2021. Using data to the close on 4 October, at the next recategorization in January 2022, we see 10 stocks moving from the mid cap segment to the large cap segment, 11 stocks moving from the large cap segment to the mid cap segment , 11 stocks are expected to move from the small cap segment to the mid cap segment, with16 stocks moving from the mid cap to the small cap segment. Zomato (ZOMATO IN) will be a part of the large cap universe, while 4 other newly listed stocks will be a part of the mid cap universe.Historically, stocks moving to a higher market cap category have outperformed stocks that migrate to a lower market cap category over the back half of the review period. In some cases, the outperformance continues past the announcement of the changes as well. This can be attributed to fund managers realigning their portfolios to meet the new categorization. This provides opportunities to pre-position for the move and unwind post the announcement of the reclassification.

India: Stock Reclassification & Active Portfolio Management (Dec 2021)

ASA Capital Management

ASA Capital Management is a boutique Research and Investment Advisory firm focusing on primary research in India. ASA provides bespoke research services to Institutional Clients with a focus on due diligence backed with primary research, Field Trips & Channel Checks.

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<p>This insight aims to track data related to discretionary spends on consumer goods. It covers a range of aspects - from the adoption of new payment methods, consumer income growth and savings data, freight and travel, rural development and agriculture to the availability of finance and liquidity. </p>
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<p>The Indicators for the month of July indicate a further recovery in most aspects of the economy. The rural economy still continues to be the main engine and is expected to remain so.</p>
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<p>The data tracker is a joint initiative done along with insight provider <a href="https://www.smartkarma.com/profiles/nitin-mangal" target="_blank" data-smartkarma-citation="accounts:1988" rel="noopener">Nitin Mangal.</a></p>
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This insight aims to track data related to discretionary spends on consumer goods. It covers a range of aspects - from the adoption of new payment methods, consumer income growth and savings data, freight and travel, rural development and agriculture to the availability of finance and liquidity. 


The Indicators for the month of July indicate a further recovery in most aspects of the economy. The rural economy still continues to be the main engine and is expected to remain so.





The data tracker is a joint initiative done along with insight provider Nitin Mangal.








Alternative Data | India Consumer Tracker - Recovery Continues

<p>This insight aims to track data related to discretionary spends on consumer goods. It covers a range of aspects - from the adoption of new payment methods, consumer income growth and savings data, freight and travel, rural development and agriculture to the availability of finance and liquidity. </p>
<p>The Indicators for the month of June indicate a recovery in most aspects of the economy. Rural Economy continues to be the main engine and is expected to remain so. </p>
<p></p>
<div class="content-highlight">
<p>The data tracker is a joint initiative done along with insight provider <a href="https://www.smartkarma.com/profiles/nitin-mangal" target="_blank" data-smartkarma-citation="accounts:1988" rel="noopener">Nitin Mangal.</a></p>
</div>

This insight aims to track data related to discretionary spends on consumer goods. It covers a range of aspects - from the adoption of new payment methods, consumer income growth and savings data, freight and travel, rural development and agriculture to the availability of finance and liquidity. 
The Indicators for the month of June indicate a recovery in most aspects of the economy. Rural Economy continues to be the main engine and is expected to remain so. 


The data tracker is a joint initiative done along with insight provider Nitin Mangal.


Alternative Data | India Consumer Tracker - Rural India Is Firing Recovery

India

Zydus Wellness Ltd. processes dairy products.  The Company produces margarine, butter, and cheese.

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Zydus Wellness (ZYWL IN)

India Channel Insight | Q4 Report Card | 59 Checks Across 5 Sectors

This insight provides select Industry-wise highlights from the 59 checks, across 5 sectors and 14 industries that we did in Q4 (Jan 2022 to March...

Pranav Bhavsar

The Narrative | Q2 FY22 | India Staples - Hindustan Unilever, Marico, Dabur, Britannia, Zydus Well

The edition focuses on key quotes from the earnings transcripts of Hindustan Unilever / Marico / Dabur / Britannia / Zydus Wellness

Pranav Bhavsar

India: Stock Reclassification & Active Portfolio Management (Dec 2021)

Halfway through the review period, we take a look at stocks that could migrate across the large, mid and small cap segments. With over US$100bn of...

Brian Freitas

Alternative Data | India Consumer Tracker - Recovery Continues

This insight aims to track data related to discretionary spends on consumer goods. It covers a range of aspects - from the adoption of new payment...

Pranav Bhavsar

Alternative Data | India Consumer Tracker - Rural India Is Firing Recovery

This insight aims to track data related to discretionary spends on consumer goods. It covers a range of aspects - from the adoption of new payment...

Pranav Bhavsar

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