Indian Equity Research and Investment Strategy
Unlike the previous Corrupt Regime of Congress, the present BJP Govt is highly determined on preserving the Health of the Nation and took another bold with hawkish stance on cigarettes which saw another double digit excise hike.
The budget has raised excise duty on cigarettes by 12-22% implying a ~14% effective hike for ITC, ahead of our as well as consensus’ estimates. This is fourth consecutive double digit hike and in fact, comes on top of ~20% hike in Jul-14. The budget (more…)
Action in the defence sector continues to gain momentum. The latest being the Ministry of Defence selecting a consortia of 2 developers to develop Battlefield Management System (BMS) worth INR 500bn. The BMS project is categorised under the Make in India category and will be one of the largest defence solutions to be manufactured indigenously. It is a (more…)
Larsen & Toubro – L&T reported weak results with standalone revenue growth of 4.2% versus expectations of 7.5%. EBITDA margins contracted YoY to 10.5% from 11.6% in 3Q FY15 ostensibly on job mix and some orders not crossing the margin recognition threshold.
While L&T, in revenue terms, is larger than India’s next six largest construction companies put together, owing to the fragmented market (L&T’s market share (more…)
A comparison of the current stock market rally with that of 2003-07 shows different path of the current rally versus the previous one. Some of the differences we spotted are (1) starting valuations of the two cycles, (2) global macroeconomic environment, (3) domestic economic cycle and investment climate and (4) earnings momentum. The current one will follow its own dynamics but a comparison is useful.
The 2003-07 rally started in the (more…)
In an out of monetary policy review decision, the RBI today lowered the key benchmark repo rate by 25bps to 7.75% with immediate effect. Consequently, the reverse repo rate and marginal standing facility rate are also lowered by 25bps to 6.75% and 8.75% respectively. The cash reserve ratio (CRR) stands unchanged at 4%.
In the statement issued (more…)
The government of India has revealed the structure of a new think-tank called NITI (National Institution for Transforming India) Aayog (Niti Aayog means Policy Commission in Hindi), which will replace the now dismantled Planning Commission (PC). The key objectives of the new body are as follows,