The annual Sales of the company were higher by $5.2 bln or Rs 20,800 Crores higher by 25% for the year while the quarter's profits were lower by $400 mln as the subsidy payout by ONGC /OIL and the deigned government agencies fell short despite crude prices higher in the new regime. A net profit for the year is an improvement of $200 mln year on year even as quantum of under recoveries shot up with Diesel and Kerosene at nearly 50% of the market prices in the international markets and that of LPG also at 50%  

Indian Oil also now owns 10,900 km of distribution pipelines and refining capacity is to go up by more than 25% to 29.5 million tonnes per annum and 

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The Sensex came back above 18000, releasing minor celebrations and hope for the new series as the India Indices continue their downward MArch for the next investment rush. Inflation did not help as WPI for food articles was up 8.55% compared to 7.5% last week and Primary Articles and Fuel both 12 and 12.4% respectively continuing the higher trend that makes sure companies will be passing on costs to the consumer now.

Auto sales for 2011 are likely to grow in double digits but not the secular 25-30% growth we got used to last year, while many hope for Diesel and Kerosene decontrol as subsidies block enterprise and bankrupt government corporations in a $100 crude economy that is here to stay

Sensex trends downward yet along with strictures on the NSE in currency derivatives making this a year of corrections and a year that might bring new gifts for Value investors in India and China

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While China plays with $330 tln in the world's commodities markets, DLF is stilll on the top of its game , sold 10 mln sft for the year and plans to sell 12 mln sft next year. The Debt of $5.3 bln or INR 21450 Crs is well within reason for its assets but it is already bleeding, almosting making a net loss on every sale when the realisation per sft is a good INR 7500 or $187.5 well ahead of the mid tier which sells at average realisation of INR 4000 or $100 in the same city at the same point in time.  Which is the brand premium for DDLF and the $100 psft also a 30% premium over the base rates in the city(cities)

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Powergrid and REC brought in late results for Q1 2011 or Q4 FY11 with Powergrid building a fresh order book of INR 1.2 Tln and H2 orders of $11 bln almost eclispsing old guard infra construction giant L&T in order pipelines. With BHEL and Coal down in front of their FPO and DLF and construction struggling in a depression bubble that is keeping real prices sky high, the Infra financiers and new age public vehicles like IDFC, REC and PGCIL remain at the front of the good looking queue.

Powergrid likely carries an asset base of $12 bln with not more than 10% of its assets in Telco lines , the rest carrying more than 105 GW capacity nationally of which 22% carries inter grid traffic for power balancing. The 105 GW would be more than half the national generated power for distribution with Power plants installed capacity at 90GW

A turnover of nearly $2.5 billion for the year does not preclude further growth in assets, sales and profits at a double digit CAGR till 2015 when India's late blooming in Infrastructure takes a critical shape Its capital raising continues at a Rs 500 cr per quarter rate raising half a billion dollars this year for further capacity augmentation. Last quarter's halfa billion dollar revenue from transmission sales was generated with only 15% in non depreciation costs implying greater profitability ahead after assets have been fully depreciated. Interest charges are anther 20% of sales

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With cigarettes revenue safe at $697 mln ( up 13%) ITC became one of the few this year to increase the Net Marging taking profits up 24.5% on a consolidated basis. Sales on a consolidated basis now leave tobacco sales contribution at less than 50% with Total sales of $1.35bln ( INR2795 Crs on a INR5390 crore sales for the Q4)

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In Desh, the retail inflation  numbers have ticked down sizably in the weekly updates, food inflation down to 7.5% and primary article inflation down to 11% from 7.7% and 12%, Pretty good, huh! 

Next week of course will be expiry Thursday, landing with a PCR of 0.8 considerably less than the 1.19 on play since October 2008...wonder if it will last the week though. 

A lot of the new results have been upbeat, including Jet Airways and L&T, and I can see buyers lurking around too. 5400 has been good, and so is KKR beating the wings out of Prince of Kolkatta XI with the horse radish loving newbies stuck with a 120 target to defend. 

Global Updates: Even as Us retail sales manage to stay above board higher by 0.5%, Jobless claims have risen, home sales have fallen and if you read at advantages.us From Osama to Libya to Re-election, Bankrupt USA has given Obama a ready mandate for 2012 ratings rising from 34 to 44 to 54(probable). We had to bring it to the india blog because this Happy thursdays post is always going to be about crunching numbers after the beer and the US market phages itself on its stats.

Also to read for the global super week, Amazon has been joined by another of our favorites Linked In a perennial global existence not bothered by stats at all and new Prudential Regulatory Authority under the Bank of England to take over from the 15 year old FSA in London and micro manage the banks dividends, bonuses, compensation and capital itself. Remember don't short US treasuries, keep buying Gold (200 tonnes in Q1 bought by Sovereigns) and the infrastructure story cannot die away in India, Africa or even the USA

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While Jet Airways managed to cover lost ground in utilisation, revenue per seat and even revenue per employee, the first profitable quarter covering up a last year gap of $116 mln (Loss in Q4 FY2010) The company only reported a profit on one time gains of $33.5mln probably from the Bandra kurla land proceeds. Payments to Sahara are netted as it proceeds to unify the brands in the coming year as well as ramp up its maintenance team now stationed at Hyderabad.

the performance is creditable considerable rises in ATF (Aviation fuel) that numbered 10 times this quarter/year. We'll keep updating this space

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The construction leviathan ( old, sturdy but old, not the shining new branded winner but the staid workhorse) reported an extra $500 mlnin Sales to grow to $3.75 bln for the latest quarter from $3.3 bln yoy.

On its strong sales report the company slipped ina guidance of lower margins around the corner. Its order book remains at more than INR 1.28 Tln and PAT grew year on year by less than 20% given the higher inflation scenario to $421 mln giving the dull days at the exchange a reason to turn back. 

Of course infrastructure plays like IDFC, REC lead a different bunch of scrips but l&T should make a difference to both cement/construction and BOT infra plays rather than push for just the order book heavy BHEL and its ME and Africa turbine sales

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Traders get a strong rebound from close personal quarters and even an otherwise unqualified illiterate with a senior position trying toi use his whiling away time to go down in flames fighting an argument with a trader. Needless to say this practice is encouraged because it closely resembles a dedicated student trying to fathom what exactly is happening or testing waters as it were..wonder what hangman games coule be invented to take care of these interuptions? A plain but hard kick in their butts ought to do it..

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..and depth in options

A lot or two from those ang us disappointed by three results went adding shorts bringing the May series to a PCR of 0.8 and less and still harping on reform / saying shorts were the ones harping on reform from the other end of their own research desk.

For these lots maybe a better idea would have been to allow unlimited shorting and facilitate market making for the same. There are some interesting targets..Apart from Glenmnark and Orchid which we support for long positions, there is cause for disappointment in SKS (the fall not yet over) and even erstwhile good quality stocks like J P Associates, DCB and the PSE banks apart from SBI which just do not have the free float to absorb a new shorting hedgie.

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There are a lot of reasons we are having deeper cuts in the market daily, a 5% whipsaw on either side becoming very common. One of the first predilections we isolated was the NBFC trader and watcher ons angst with the constant over performancefrom the Financial sector.

Very frankly, almost half of our GDP coul d easily belong to Bankss and Financial Services and half of the remaining to other seervices stories, so our Bombay Club predeliction for manufacturing is still subservient to a largely bear or frustrated trader audience thence the whipsaws.

A Dominos foods , even though services was isolated by such a trader group in the market i believe, and thus also the aviation and the hotels story backers whio somehow cannot co exist with the banks and financial servicesp plays esp as in the branded domain, these sectors have just not enough going fo rthem compared to financials. 

All our chosen Export hits also thus gravitate to the SME segments with mid cap Auto and Healthcare stories. A big gap nonetheless

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Bloomberg has obviously lost share in the last bull run and the aftermath, esp after AShu cost them quite a few pips. ETNow however has shown up strongly with good editorial content but more thanthat covering the young ones on the beat witha a couple of very glaring gaps being covered like Tomorrow's Markets and some competition to Udayan finally with topical questioning from that boy in the woods, Nikunj Dalmia.

ET Now does claim 47% market share in Metro segments ( Delhi/Bombay?) The Investors Guide Transpose did not quite work, neither has Fund watch tajken off on Bloomberg UTV but ET brings in a certain topical directness that is refreshing to see esp in the trading room. But obviously, TV18 has much more market share and NDTV Profit and Bloomberg much more finesse.= and even global depth, Reuters unable to hand off its expertise on the Asia front to the Bennett Coleman team

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In a suspect story, the UTV venture in India went on an overdrive to catch Auto sales growth numbers as mindless hype breaking the lull in April with a thud between Primary and Secondary Sales. I thought it was perfectly fine if SIAM reports Primary sales and Govts report secondary sales a few thousand less. I would have at least scrapped portions of the story when the difference came out to be painfully low..reports in two large markets coming almost matched with TN showing an inventory of hardly 6000 cars.

This probably is a normaly dealer rant fed up of first sales already committed and looking to shore up their margins as price hikes come to town to battle primary article inflation and that in basic goods

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The only properly differentiated play in Insurance which is independent of most of the groups other businesses whetehr for Capital or for Holdings, Bajaj Finserv did $750 million in Life Premiums and $250 mln in Amotor and Health Insurance in FY2011 with pretty strong profits in the business. Bajaj Finserv is also a listed play with good corporate governance and despite earlier reliance on only the ungoverned ULIPS and Super bonuses, it is now serving the latest IRDA approved fare and wants to grow the AMC business and then get a bank licence. All aspects of the business that have not grown since 2008 incl life insurance where LIC is getting bigger and better

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ONGC and GAIL along with OIL (East India based fields) have finally hit turbulence with higher Crude prices simply meaning an extra $2 billion outflow for paying the marketing companies bills in the regulated price scenario and OIL prices have become an anachronism for India's oil producers..maybe even Cairn and BP would be asked to pay our price at the pump deficit?

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Though of course not strictly comparable, the food shops and the gyms from Dominos, Talwalkars and now Pizza Hut have been scoring higher marks on valuation than easy marks like Ashirwad Atta and Lux from ITC and Unilever. ITC reports tonight

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Don't buy your Mitts and retail holders yet!

MSCI Index added our favorite Mundra Port along with Dabur.  In Nov 2010 5 stocks have been added from the India story in Global indices incl PSB Canara Bank, new banking licence aspirant LIC Hsg Finance and Indusind Bank. Others were Cement majot Ultratech and Pharma mid cap Lupin. The other stocks were added to Small Cap indices and the India indices are now being updated with Shriram Transport Finance, Jubilant Foodworks, Mundra and Dabur

Anyway. with Emerging markets set for a rebound and India replete with buying opportunities, action is likely to return today itself into the world's best capitalised and most accesssible markets in Mumbai. 

We await results from Bajaj Auto (expect $1 billion sales per quarter to maintain) and ITC today

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After OP Bhatt left Pratik Chaudhuri has taken no time in utilising the changeiver to mark a new baseline for the bank's further performance measurement as it remains the star of the Indian Big league. With unending discussions on provisions the bank has raised provisions by more than $275 million or INR 1100 crores to INR 33 bln bringing profits to NEAR ZERO for the quarter. A Sales growth of 19.9% in NII shows that Credit growth tapering off will no longer be compensated by low rate marketing and on retail mortgages also all excess provision requirements have been adhered to to be on the policy makers side. The counter cyclical provision has also been created for India's "TBTF" effort

The bank has increased Net NPAs by a few bp to 1.69% Its rights issue has been deferred and a standalone provision exceeds $1 bln

meanwhile upstream energy comppanies have also been chosen to bear the rising OIL bill increasing their contribution to 39% (proposed) 

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The 378 pizza stores to be supplemented by Dunkin Donuts Cafes in December 11 grossed Rs 57000/- per store per day for the 90 days of this quarter on an average (based on reported sales of Rs 1.940 billion or $485 million) and obviously improved profits 86% on a yoy basis.

The category is jumping hoops and Jubilant Foods is going to add another 80 stores this year building on 72 last year to fold in another 2500 odd pizzas every day. Assuming it stays with cosmo and Teir I&II locations. Also the new Dunkin Donuts are likely in smaller towns and maintain the sales growth of 56%. Profits of $48.3 million come to Rs 5682 per store per day and we feel the industry growth rate of 25-30% could apply to sales at existing stores only, which all the added pies would be pure profit adding margins.

Thankfully though, the pie's run on the exchange has finally been aborted because the DD franchise is unlikely to be an upmarket winner and the new competition its first taste in India. Current pricing of the new IPO was much a function of the scarcity of good consumption stocks in this global economy no. 2

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Glenmark is now the first of the New Generation $1 billion Indian corporates who cnan swing a global giant on its toes for a day of waltzing than a 5 minute bollywood snapshot. After India's PR failed in the last 20 years to read the western mind and the trauma in the markets there, the new generation deals have started to look creamier and thicker with the Glenmark signing. The GBR 500 molecule has passed some trtials for human disorders like COPD, IBD and ius ready to go big, fetching nearly Rs 400 crores plus lifelong marketing rights across 5 continents for the Indian drug maker. 

the sector has earlier belied hopes for well over 5 years following textile exports and auto ancilliaries into oblivion almost, before being brought back with smaller marketing arrangements with Biocon and Sun. The SUn MSD deal could potentially be bigger but is just a signing, while the Glenmark deal is here and now for a drug ready to enter the marrket. Glenmark has also upgraded its margins in Q4 with a $50 million profit on $275 million sales ready to enter the big league and now ahead of Sri Aurobindo and maybe even Ranbaxy around the bend

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While Balrampur Chini results shone with 3X increase in profits, the weekend weather was mostly sunny but Monday brings new uncertainty as political fortunes and that of the region as a whole depend on the same old business partners, GS signing new local funds in Beijing and JPM hanging on to its global business as its 60 million USc customers spurn home equity for the 4th year running. With the new debt business from India restricted to a few infra companies, the settin g up of a Power distco rating system will come as a relief for REC and PFC among others, doing the unfancied job of lending to power projects and distcos owned by bankrupt states. 

In that scenario, the continuing strengthening of India's Banking sector continues to be a great white hope. Notable and appreciated though is SBI's attempt to get ALM on the new deposit regime using funds matching the new MSF to invite better deposits from customers. When the bank hiked its deposits by 50 bps, it upped the 6 -12 week deposits by 225 basis points to 6.25% still 200 bp less than what it would be charged if it approached the government. There are at least 5 stories here we migth pursue, but i am afraid i am not ready to hand over the baton to our business media from mint and ET yet and the trading room beckons... 

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To what ails the sector, firstly we need all players talking the same names when they report results. SBI Life looking like a juggernaut with Gross Written Premiums of $3.23 billion when LIC Net premiums are overall more than twice the entire industry, making comparisons meaningless.

Even then, SBI Life performance historically has been credible and if they keep losing share of premiums in this market they will still not face profitability challenges with this book good for probably 5-10 years. In their early years they were the proponents of single premium products and thus could not have said the same about themselves. Their total book now exceeds $10 billion adding $3 billion in this last year, $1.4 bln in renewals with a persistency of nearly 70%

The profits of $89 million for the year are still much to write home about where industry no. 7 HDFC Life (profiled earlier) is still reporting $15-20 million in losses after 10 years of operations

SBI Life's New Business Premiums amounted to $1.75 biliion, a similar tick almost to the hundreds for the top 5 in the industry. Of course without ULIPs Bajaj will drop out from the mix for some time and MNYL may just be back but they are probably doing half a billion and alongwith bank JVs hoping for a bigger corporate partner bang

SBI Life's agency system contributes only 42% of the business, but according to the company results release it has been receiving awards from networks (Bloomberg UTV and NDTV profit) for best life insurer 

As per the latest IRDA report, as of March 2011, the company has market share of 19.22% among private life insurers and a total market share of 6.02%.

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Unlikely..the winning core team of the India Infrastructure story is resilient and used to challenges

Though Indian operators do not have the habituated brand of global infrastructure giants and are getting preference from the government in financing as they have to use the $3 trillion infrastructure cheque to build India's ports, power plants and many more, we seem to be enjoying their discomfort taking the entire brigade as equal to constructionc ompanies and worse treating them like defaulters from mid cap space even when they include institutions like REC, PFC, PTC and above all IDFC

While one can understand General Kamath's discomfort with the high interest rate regime he stewarded in the 90s , a t that time apart from not having a retail mortgage book we also did not have a tiered strcutre of investors playing cash trades and funding the india story so willingly. Corporate Finance at sub 20% rates may not be repeated in this generation by high interest rates let alone create a sad layer of former infrastructure projects in a BIFR like bundle for happy punting and 89 meter maximums for the sporting traders in the global carry trade economy.

Why it will not happen is also because institutional portfolios like that of IDFC are of much better underwriting strengths than Kamath's ICICI which stil has all the processes in place. However in roads we do have operators without much history and thus much less of a future. those who doubted GMR and GVK are already licking their chops and there remaining leveraged units has not created extra default situations.

In the absence of a larger superset of Billion dollar networth Infra businesses it is probably been more of a handicap for which IDFC and REC have been needed yet Also Delhi metro and others have proven we have the quality of project management required to build the processes within this consistent superstructure for Infrastructure Finance which will continue to stretch banks that want a piece of the lucre fronm the sector and keeps gravitating to construction plays in its corp credit book. 

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How my daughter would have reacted to them market story being played out. The trading stories really lack maturity here in the NSE minefields of INR 1 Trillion -- two trillion on a good day -- with most value plays (Mid Caps) strapped on to 4 investors and 1 broker playing an amusement park ride and nothing so intelligent or scary as a roller coaster.  The results season just showcased how easy it is for Indian companies to grow double digits quarter to quarter but it is just not getting the bang for the buck as we look on to someone to start rolling fresh cash into the markets. DIs buying of course to reduce the impact cost stick on to this purchase cycle and are ending up with value picks where most of the leads coined by india bulls have gone kaput led by "rate sensitives" > Where SBI's deposit rates and cost of funding was as low as 6% in 2009, its raising deposits by 75 bps to 225 bps along with lending rates as thankfully however been noted a s a great positive, but why they are waiting on ICICI Bank despite the big results or HDFC and HDFC Bank, The erstwhile Mid Cap, Axis Bank has of course pegged on to a new size as the Big 4 locally and plans to grow slowly, an example of a stock market darling that got her ambition and served the investors well. But many more are waiting none fof them likely unresearched . The drawbacks are there nonetheless but not the ones recognised in the marketplace. For example, without due liberalisation, most sectors now have leading stocks with larger sales and growth numbers, not listed on the Indian markets, we have the Emerging market ETFs supplying regular funds to India keeping India at a lowly7-8% weightage and the India ETFs getting into pretty laconic and clubby investment cycles some where probably because of the small number controlling larger sums. None of the drawbacks is so contrary than our predilection for the worst grade of investors/traders., like Morgan Stanley leading press and networks into a decided trend. MS has a long history of catching the BIG LOSER pretty quick and in lthat it is almost a 99.3% consistent leading indicator on picking the wrong trend or a trend dying out. I am so tired and confused. 

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HDFC again underlines India's NBFC structure / Institutional structures for finance & Credit companies across Infrastructure and Housing. Additionally it emphasises that India's disappointment riddled 2011 still means a more than 20% in sales year on year and 12 % profit QOQ. HDFC manages a 30% increase in Sales and 23% increase in profits for the quarter. Sales are up to $947 million for the quarter and Profits are an important 25% margin at $230mln (Net Profits after tax) with Net NPAs at NIL

DEfaults are more likely if interest rate hikes continue into 2012

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Hindustan Unilever continued to invest in Advertising and promotion at $156 mln , 12.7% of $1226 mln Q4 sales in India a good 3 times the globa rival P&G and unlikely to grow in more than low single digits despite such huge brand investments. In fact competitior ITC is doing much better having started from nothing in Foods and Personal care just years ago  with its current crop of brands already having two $1 billion candidates among half a dozen such brands

HUL profits are down to $143 mln as input costs continue increasing and the company is unable to pass them off to the consumer, rewriting SKU weights and packaging to create innovative margins and coping well with a stable market share in its food (where it does not really have a string brand except Ashiwad Atta) and slightly less in personal care businesses

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Adani Power

This Gujarat based Electricity producer and co owner of Mundra Ports is agreat value for money with two good cities under its belt in gujarat and one in Maharashtra. The smallish power company has just upped its Electricity units produced 5.5 times and utilities in India regulatorily enjoy a minimum profit of 12-16% on all its sales. The company sells 88% thru Power purchase agreements and the Merchant Power component is already pricing at Rs 4.5 and upward i.e. 11cents is toward the lower end and relalisations could cross $0.33 cents for each unit during the summer shortages. The Adani Power units sell to State owned boards, in this case, GUVNL who owns distribution and even that lower rate is an average INR 2.88 per unit a realisation of INR3.09 per unit may grow by 20% even in the coming quarter thought the management does not give any such guidance and even if they produce the 7.5 billion units they crossed this quarter, the team is looking at maintaining the 50% yoy growth it produced in December 2010 and now in March 2011. The third turbine added 330 MW for the company and units at 85% availability have moved from 1.2 million units per quarter to close to 2 million units per quarter of which offtake from GUVVNL is assured/mandated for 85% 

Mundra Ports

the private port operator finally overcame capacity restrictions on its new port facilities taking its annual income 36% higher to $500 million and Q4 profits 74% higher year on year to $84 mln, annual net profits with a great 50% margin to $244 mln (INR 917 crore on sales of INR 1938 Crores) the company also acquired 50 mtpa capacity this month from Aussie Abbott Port for $2.2 billion

India Results Season

Indian companies have been growing profits at 12% qoq as also sales despite the lower IIP and higher inflation and the report card ( for 732 companies as of today, check indiaearnings.com) is looking great

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Though one may dare say that it was evident as early as late 2009 when the Bull run had already started but Quality FIIs had not planned anything for India, India has long lived with the notion that though it might grow, not many investors are ready to let it stand up to them ads its monetary mechanics don't match big bully China but still are not as pliable as rent driven Mexico or squeaky clean Chile and in Asia, the Nams and the Bangladeshs. We ran through two great Sensex upticks fueled by a smattering of FDI cream and mostly Domestic investment good for at least 20% of GDP into the stock markets. We are also not great candidates for hot money but still the last quick bull strapping of the markets happened in March on $1 billion and three days of reactions got it down to worse with the same amount lost.

Now in one day of trading we have chalked up another $500 million and talks of support at the more comfortable 5500-5600 levels. Though short interest might want a stable target of even 5300 and noises have been heard baying for more, it is not in the nature of the Indian markets to respond to that extent as Central Bank policies, protection and liberalisation mean only micro-trend formation and are unable to either destroy any value motive in the current valuations or grow into a bigger superpower, though even now to that there is a studied upward bias in India's fortunes and even stripped of hope one is staring at multiple upward re-ratings and higher weights for much neglected India.

Till that comes, none of us are losing sleep over it, resulting in keeping us busy on the treadmill running the status quo without much traction, repeating micro-cycles and even bigger trends since that day in September 2008 when the world turned on its head and cemented the plan to let growth lead in a very few years. that also does not mean there has been any reduction in the ranks of EM haters and that Democrat or Republican US policy continues to favor more tribal neighbours like Pakistan and continue to disfavor higher value relationships with India in Defence with a non NATO, non militant national government with an independent state policy.  with all its nice sounding tinges that is the same list of limitations in the reforms statute and the growth conscripts since the nineties almost 25 years back when we started a journey fueled by investment and reform pain.   

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Cadila beat a lot of MNC competition with reports stamping their approval on PAT growth 50% yoy for the quarter boosted by on time forex profits of $45million and a revenue tick of $275 million almost twice the size of a GSK Pharma quarter of $150 million revenues, Cadilla scoring $30 million in profits at 10% NPAT and GSK Pharma at almost 10% with a $1.5 mln NPAT. The Pharma lot look surefooted and steady even as the Phase I winners wave by with pressures on Volumes, FDA disapprovals and new Excise regulations esp at Ranbaxy and Dr Reddy. The sector and its allied winners in Biotechnology are increasingly getting good vibes for taking revenues to the next level of $10 bln each from the current park of $1 - $ 4billion for the year just a tad ahead of the auto ancilliary specialists with $200 mln revenues etc. Emerging Markets should now steam roll some bigger numbers from this sector and we're hoping!

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Contrary to initial reports and apparently after trying for a distress sale from the Henkel promoters, Jyothy Labs , owners of the Ghadi brand worth Rs 2200 crores or $500mln walked away with TN Petro's Henkel India's 50% promoter stake for 115 Crores in Equity at $0.50 per share it is good enough for the poor house brands but the cost to Jyothy is considerably higher servicing an additional debt burden of 525 crores or $131-2mln for the old company without its barber shop brands.

The open offer at current rices closer to $1 per share may fetch another $25 mln for the Henkel brands taking Jyothy's stake from 65% to 85% Even with majority interest in the company, rebuilding the Henkel brands would require considerable risk taking but PE premium for 26% in the Jyothy Labs group holding is unlikely to be a seriously broached subject, and if PE invest,ment is expected, it would matter that the same is only around the $50 mln spent by the Ghadi promoters to buy the Henkel poorhouse brands and for its rural/poor urban household market distribution and advertising investment benefits 

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The way larger percentage changes are favoring cash and infrastructure, it may be that cash margins and punting by these promoters is still the primary reason for this winding accelerating and heading down in such discrete steps. As of today we were still net positive a couple of 100 crores of FII portfolio investments after $500 mln netted by end of April

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Same turnover, the glitch in NPas was minor and they are back to 0.7%, Sales are tired holding NII and fee based income up 15% y-o-y , definitely the bank mapped by the bears on India as representative and definitely not a good future for growth in either Credit or deposits. Insurance, brokerage and allied businesses continue to score in hinterlands of ethics and brand remains Uday, upfront and sincere..a window to India's wealthy's expectations in a scam riddled nation. Anyway I do not know if they are ever going to even attempt strategising very sure they are right about everything and traditional markets of wealth being their only succour even though the Gujjus keep spurning them. Is a Swiss bank tax haven actually our basis for the bank of the future if it is not over dependent on technology? 

New bank licences will probably end up as modified NBFCs and I do not say glorified as Kotak's example shows, everyone wants only Cosmo branches and traditional markets and then insight pebnetrates only 5% of the market. Sahara anyone?

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Unilever has made shampoos 22% cheaper, unit realisations by all retail lifestyle champions more realistic today with the rupee stronger and Sugar like all commodities will only rise higher. While derivative food and Fuel user industries will continue to face pressure in inputt costs, higher price realisations, exports and even supply side reform policy plans post Lokpal and Maha assembly polls will likely come to the fore apart from a nice and sweet 2011 for food producers thanks to the inflation, margins will be easily passed on to the consumer. Sadly though, one feels branded foods and even at commoditised consumption levels, there is an acute shortage of food producing facilities in this continent. 

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India Auto industry maturity continues to rise albeit in smaller units like Jamna Auto and Pricol. While Pricol signed a Jv supplying parts to Maruti - Volkswagen ( output VW small car ), Jamna auto drove a 472% rise in Q4 sales to finish the year with $11 million in profits($4 in Q4)  and $202 million in sales

Subros somehow got zilch for all its expansions after a near total dominance of the Car A/c units . Jay Bharat Maruiti was also a great product company/unit to discover, now getting out from the Maruti only fold and doing well

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Profits seem below expectations at Rs 899 Crs or $225 mln esp as the expectation was a good 10% on the upside for NII, the Bank delivering less than $250 million even at 40 to the dollar, NIMs comparing with global peers in a far more unleveraged structure and NPAs rising despite spreads being almost static across the sector, the slow bear downhill is fast looking to break the ice in the lake..Welcome to bouts of snow in midday heat

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With Africa delivering a billion dollars in revenue, Airtel went to becoming a $4 bln quarter company with relative ease. the industry pressures however have started showing on the leader domestically, losing ARPUs to 192 per subscriber and minutes down 1.5% to 442 ( for the Indian Market, where revenues are $3 bln and over) The Profit of $350 mln continues to destroy corporate brand expectations for the company, where the management expects a market share downtick from cannibalisation of its share by the plethora of players whose bill plans have had to be competitively adopted by Airtel and Vodafone also.

Apart from the growth in Africa, the management's predilection for confusing the corporate brand with its market presence may continue to be its downfall, as strategy budgets are honed to operationally upend the current equip,ment in its 17 new business zones in Africa EBITDA has grown from 31.5% to 33% and they are good for the long run

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With trades actively discouraged in this B category scrip all thru the announcement of its big purcahse of Henkel's retail "poorhouse" portfolio, things are likely o brighten up for some of the vested parties as the PE investor news breaks out for a 26% purchase at a reasonable $7 per share price ( here, Rs 300 in local currency) The PE will ofcourse be holding it in a India mid market fund  and waiing for it to deliver in the next 5 years. Does Private Equity understand the risks of the mass market or is it just the opportunity? Will there be more PE in the retail players, where we have few but long establisjed playes provemn to be losing the battle against inflation and still better bets than anything except Gold and Steel ( and Silver) 

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I know what sets me off against the winner of the bank wars 

Though HDFC Bank remains a perennial favorite of India bulls because of its efficiencies and hold over a high interest rate captive market for credit products, tit never ceased to amaze me that the LIC of the group, Standard life could not really stand up after being the most capitalised company in the sector. Of course with impending IPO norms and Reliance having beaten them to 5th rank when the crisis began, we do hope to look at some detailed Financial statements from these "new industry barons" soon, as a lot has been hidden inside the carpets by everyone with IRDA needing to be active in policing the instituions budding into a smaller pie every year. Now the public LIc and the private LICs divide the market 67:33 and this number would be even more in favor of LIC of India ( which had a INR 4 Trillion book this year or thereabouts and by assets already is 9 times the private players ) if the single insurance product not been sold heavily esp in Q1. Amazingly after Premiums of $1.3 bln the HDFC Standard Life team delivers a sixth rank and a $19 mln loss for the year following a negative $450million loss in FY09, and $69mln in FY10. what a shame! 

Recovery has been slow and steady but we would continue to be hypercritical of any business that cannot want to publish a complete set of Financial statements Very frankly their size is not enough as an industry to believe that their hyper growth in the 1st 10 years will actually amount ot anything from here..Also without Unit products they have all stopped making any effective sales growth in this "industry" Indian Telcos are far more profitable whence Telcos historically wthe world over survive on high prices of hardware paid and lost volume churns ( which also they share with the LIC industry) 

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Profits year on year are down 16% and the auto number s for March have definitely scared observers as well. The profit deceleration is hihger than expected ( misses Bloomberg poll estimates by 2% ) Sales growth numbers are respectable yoy like for others as Bajaj Auto and Maurti, Hyundai ( even yoy pretty bad) 

India just does not have the profile to switch to SME players in this age and till the dollar gets to levels of below Rs 40 to a Dollar, the Trillion Ruipee EV companies are likely to be good enough for PE or individual global portfoliso. Index ETFs are anyway 75% of the FDI with $1 bln per month likely to continue. disposable incomes allowed food and fuel inflation without concerns yet, but going forward the larger imported inflation and the transmission to manufacturing and the retail demand curves ( durables, autos, services) have been the immediate market concerns that need facts to displace the pessimism

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SBI and Axis already preferred by PEs and Citi's latest research, PNB has long been our candidate for a size led market reach explosion in Tier 2 and 3 and now 5 and 6 towns as per RBI diktat as well.

However hard put they may be by a high interest rate scenario and their redoubtable marketing/ interface strategums of leading with first and relatively highest scores in transmission, the ensuing hostilities in the market place have long been smoothed by rent and public avarice for these public sector banks.

Another 20 basis point decline in NIMs underscores PNB's stated peaking of NIMs in the previous Dec 2010 results. Still the bank has $5.25 bln in Interest Income alomne putting Average Weighted Funds at $136 bln for the year ended March 2011

Also strangely Indian Bank has not folowed into the disaster zone pushed by most banks in the public sector space wih a growth of 22% in NII strangely as they already hold extraordinary NIMs and a pretty small asset base. 

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A 50 bp hike, addition of a MSF rate 100 points above the repo rate and the removal of the reverse repo rate as a floater. It would be npow in a fixed channel denoting the lower end of the channel at 100 bp below the repo rate. The market should really welcome this policy as allt he planned reforms from the liquidity panel have been added as a bonus while the market was well set for  a 50 bp kicker. The advantage of being part of a thinking growing economy is that it becomes easier for you to be at the top and mauntain thought leadership. Move over the oughts, we are finally in a new decade.

The central bank has also nmixed liberal norms with simpler policy conditions which might cause a few hiccups with the old guard esp those from MNC banks as 25% of all new branches have been requested in Tier 5 and Tier 6 locations taking care of the unbanked at least academically. As policy goes of course this is much nearer to implementation also unlike the deliverance from the beauty and the beast year on year without a set course showing which has been turned on its head since 2007-08 with Duvvoori Rao firmly int he saddle taking a distinct direction and moving fast on the same. The contingent facility and the availability of 1% of CRR+SLR to the banks in overnight should be a brilliant move to keep yields in check as banks could have ended up the bvillain in pushing up inflation ain the conming higher inflation lower growth era for the economy. Also ahead of deregulation, savings rate has been kicked up to 4%  

As predicted  a lot of noise about inflation too..as the mogul is still speaking, we shall wait for others reactions too

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An aggressive competitor trying to leverage its balance sheet assets, PNB also works with the retail consumer at top of mind recall, running to raise deposit rates ahead of the herd and change its public colors to something more acceptable as a competitive player without investing in expensive ( maybe pro bon) marketing / rebranding efforts. nevertheless, with a downtick on the banks, it will pay dearly in terms of eroding sentiment (The ship to run away from ahead of today's results) 

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The Henkel India deal will probably burn Jyothy Labs share holders no end as the same has been finalised at nearly 900 crores and acc to reports the debt in that is only 525 crores. That means that after paying 60 crores for 14.9% i.e. $15 mln, they are paying 375 crores or $94 mln to Henkel of Germany for 50.1% of the company at a premium of almost 100% if the amount is right.   At the rate of Rs 65 per share on the back of the envelope, this is obviously usury for the buyer, and even if it is nearer 50/- it is much more than reqd premium to pay for the very much homegrown brands Jyothy is buying in the portfolio 

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The rate hike arguments, the camp arguing that RBI is behind the curve (J. Aziz, Big Bull of Wool) and India's own Procrastinators ( Big Bull of Home and hearth ) have all commente d on the double whammy and the market is utilising the opportunity to increase its own profit margins where it starts for a big zig ziggy right from 5700..The serious debate on rate hikes however is relatively simple, in favor of India's baby steps and more such paranormal influences on duvvoori Rao tonight.  We will not slay inflation though, and that is why we will be growing thru 2012 and 2013 while China would have slayed inflation but not to fall behind us but to move on to try and get people to sell UST and buy Dim Dum bonds not for IPOs but for keeps as the battle to have a new home for the world's reserve currency is about to start and it dfoes not include INdia, Asean, Asia, Europe and the Swiss or Australian Dollars..here's to currency wars!

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(Press Con/Analysts) Profits in the core business grew 40% with loan book now INR 480 bln ($12 bln) at 50% higher, the support from fee based businesses have marginally declined as AUMs in the AMC decreased in FI outages and falling NAVs. 

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