HDFC Bank 3Q results were below expectations, especially on the Deposits collections. Management was showing confidence earlier that they will be able to garner Deposits at good pace and it didn’t happen this quarter.
But we should also see how other big banks (esp. SBI and ICICI) fared on deposit collections this quarter to gauge how bad HDFC performed. If everyone slowed then the problem is less severe (systemic).
I will not be concerned much if we found that everyone slowed, since it means overall banking sector slowed and when better opportunities come in future then HDFC have good chance to capitalize on them.

But one thing is for sure: the Large base effect has indeed material impact on HDFC Bank. Markets had got it right earlier and I personally overlooked it. Now I have reduced my long term HDFC returns expectations, from 17-20% earlier to 12-16% now. I think HDFB bank is still a good investment bet on return-risk profile.

I am not bothered about NIM reduction much. NIM of 3.5 is not bad if they can keep it for long.

Also, I really don’t mind if markets derates HDFC bank further. I will be happy to buy more at P/BV of 2.0-2.5.

Disc.: HDFC Bank is significant part of my portfolio.

So Ascendant…the idea of following Gulaq 6 is nice and seems simple.
I think many of us who started journey in 2020 or mid 22, have observed fairly good run at pf level.I observed the names in pf are like taking turn at rising amongst them…when those who ran too much are taking break others start running…and its going on since past 1 month of so.
As 90% of my pf are smallcaps and in the present run as i try to control greed, i feel like “hooked to quick run”.
My query1 is related to ebbtide.
1.Is there any smallcase which stood up or was able to grow during oct-21 to june-22 ?
Query 2
2.what are your thoughts, going after individual names rather going directly on to smallcase itself ?

UPDATE: MSTC 316-530-735-1000, a new ATH…

• An excellent base breakout seen in MSTC. Base formed since October 2021.
• A small pennant type pattern seen just before breakout as well.

Approaching Fibo 2.618 levels.

Safe to assume a bullish bias ahead…

Today i found this stock in my screener.
Gennex engaged in the business of manufacturing of Bulk Drugs and intermediaries, covers customers in both domestic and international markets.

Name : Gennex Laboratories Ltd.
Sector : Pharma
CMP ₹ 17.7
Market Cap ₹ 314 Cr.
Book Value ₹ 4.87
Debt ₹ 21.9 Cr.
Cash Equivalents ₹ 23.0 Cr
Debt to equity 0.25
Return over 3 years 53.1 %

Red Flag :
Pledged percentage 34.1 %
Promoter holding is low: 23.6%

My observations:
1. Financial Health: The company has a market capitalization of ₹314 Cr. with a debt-to-equity ratio of 0.25, indicating a relatively low level of debt.

2. Profitability: The return percentages over various periods (3 months, 6 months, 1 year, etc.) show positive growth, suggesting the company’s profitability is improving.

3. Balance Sheet: Reserves and equity capital have been steadily increasing. The company has both short-term and long-term borrowings.

4. Cash Flow: Positive cash flow from operating activities is a good sign. However, the negative cash flow from investing activities may need further investigation.

5. Sales Growth: The company has experienced fluctuations in sales growth, with a notable decline in the most recent quarter.

6. Expense Analysis: Material cost as a percentage of sales has been fluctuating, and employee costs have seen variations as well.

Conclusion:
While the company shows positive signs with improving profitability and a healthy balance sheet, fluctuations in sales growth and expenses need careful consideration. Further analysis, especially regarding the recent decline in sales growth and cash flow from investing activities is recommended.

Any valuable insights or observations from experts specializing in the Pharma sector are welcome.

Hi Karan,

The company is pure commodity company with standalone product. It will take time / and effort for company to have multi product scenario.

I agree there have been massive lapse on corporate governance front buts thats common in 80% of companies in India.

We should see this from business cycle point of view, and buy on good results thinking it to be turnaround.

Thanks
Kritesh