IDFC First Bank Limited (19-10-2024)
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Your equity portfolio, you can control risk and returns (19-10-2024)
Please explain in detail like how it can be done
GST rates on host of goods rejigged (19-10-2024)
Term life insurance policies, and senior citizens’ health insurance premium are likely to be exempted from GST as most members of a state ministerial panel favoured cutting taxes to benefit the common man, an official said on Saturday. The GoM to decide on GST on health and life insurance premiums in its meeting on Saturday decided to exempt GST on premiums paid by individuals, other than senior citizens, for health insurance with coverage of up to Rs 5 lakh. However, 18 per cent GST will continue to be levied for health insurance cover of over Rs 5 lakh.
Ranvir’s Portfolio (19-10-2024)
Axis Bank –
Q2 FY 25 results and concall updates –
Deposits @ 10.37 lakh cr, up 14 pc YoY ( CASA deposits grew by 5 pc, CASA ratio of 41 pc )
Advances @ 10.00 lakh cr, up 11 pc YoY
NII @ 13.48k cr, up 9 pc YoY
Non interest income @ 6.72k cr, up 34 pc YoY
Operating expenses @ 9.5k cr, up 9 pc YoY
Operating profits @ 10.7k cr, up 24 pc YoY
PAT @ 6.91k cr, up 15 pc YoY
Consol RoA @ 1.92 vs 1.83
Consol RoE @ 18.08 vs 18.67 pc
Gross NPAs @ 1.44 vs 1.73
Net NPAs @ 0.34 vs 0.36
Total provisions ( specific + standard + additional + contingent ) stand at 153 pc of Gross NPAs
NIMs @ 3.99 vs 4.11 pc YoY
Cost of Funds @ 5.45 vs 5.17 pc YoY
Total Branches @ 5577 on 30 Sep 25 vs 5377 on 31 Mar 24 (opened 150 branches in Q2 and 50 branches in Q1)
Breakdown of loan book –
Retail loans – 5.98 lakh cr, up 15 pc YoY
SME loans – 1.10 lakh cr, up 16 pc YoY
Corporate loans – 2.90 lakh cr, up 3 pc YoY
Gross slippages ( annualised ) @ 1.78 pc vs 1.97 pc QoQ vs 1.49 pc YoY
Net slippages ( annualised ) @ 0.96 vs 1.37 pc QoQ vs 0.59 pc YoY
Net credit cost @ 0.54 pc down from 0.97 pc in Q1
Fall in Gross and Net slippages on a QoQ and YoY basis is a key positive
Integration of Citi Bank’s entire portfolio with Axis bank completed in Jul 24. Behaviour of customers ( in terms of banking transactions post acquisition ) is satisfying
Cost / Income @ 47.29 pc, down 207 bps YoY
Bank’s head count has increased by around 4000 employees vs Sep 23 – due opening of new branches and hiring related to improve the bank’s IT infrastructure
Aim to open a total of 500 branches in the current FY
Most of the slippages are originating from the unsecured retail lending part of the book. Bank is monitoring the same and taking actions as deemed fit
Breakup of the retail loan book –
Home loans – 1.67 lakh cr, up 5 pc
Rural loans – 89.6k cr, up 20 pc
Personal loans – 75.4k cr, up 23 pc
Auto loans – 58.7k cr, up 6 pc
LAP – 67.2k cr, up 25 pc
SBB – 61.9k cr, up 23 pc
Credit Cards – 43.7k cr, up 22 pc
Commercial Equipment loans – 11.6k cr, up 4 pc
Others – 22.7k cr, up 26 pc
Total – 5.99 lakh cr, up 15 pc
71 pc of the retail book is secured, 29 pc is unsecured
Bank aims to accelerate the secured part of retail lending and calibrate the unsecured part of it – so as to best manage
Bank is maintaining its discipline on deposit rates. They intend to maintain this discipline going forward as well ( provided the mkt players behave responsibly )
In Q2, operating expenses went up by 9 pc. Bank expects this kind of moderate growth in costs to continue going forward as well
Expect the growth rates in home loans to remain moderate as the risk adjusted returns in this segment are on the lower side ( due lower yield on home loans ) – hence is Bank is going slow on them
The bank is not in a position to give a guidance weather the stress in unsecured – retail slippages has peaked or not
Small and Mid corporate book has been growing smartly for the Bank for last 5 yrs. In all likelihood, the same is likely to continue in the future as well. According to the management, MSME should turn out to be the best banking area for the next decade !!!
Bank believes that it can keep growing its loan book at rates 3-4 pc above the systemic credit growth. That should mean a loan growth in the vicinity of 14-16 pc. Q2 is an aberration. They believe that they can achieve these numbers for the full FY
Disc: holding, biased, not SEBI registered, not a buy/sell recommendation
HDB Financial Services aiming to raise up to Rs 12,500 cr via IPO (19-10-2024)
Last month HDFC Bank approved raising Rs 2,500 crore through an issue of shares in the IPO, marking the group’s first public float in six years
WIPRO Buy back – A good bet for Short term (19-10-2024)
Wipro Q2FY25 Earnings Analysis:
Rupee set to hold ground against greenback till Dec (19-10-2024)
After depreciating 0.32 per cent against the dollar in October so far, the rupee is expected to hold ground against the greenback in the current quarter on the back of robust inflows. According to the median of a Business Standard poll of 10 respondents, the rupee is seen trading around 84 per dollar till the end of December. “In India’s case, at least the bond and cash related inflows will continue.
The Ideal Investment Thesis (19-10-2024)
Most of the metrics what you have taken are based on historical performance. I would rather look at what sector is flying at the time of your investment and then start looking at these parameters on the companies who are operating in such sector. The sectoral preferences from time to time will keep changing and if you don’t take that into consideration, then your portfolio will give you an average returns. Hence suggest to keep track on the sectors which will grow in the next 3-5 years and then select the best stock in such sectors. This will boost the growth rate of your portfolio.