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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