HFCs have lent Rs. 2 Lakh Crore to the realty sector. Where are the NPAs?
“HFCs have lent Rs. 2 lakh crore to the realty sector. Where are the NPAs,” Sridhar Sivaram thundered in an aggressive tone.
“I am not happy with the disclosure norms,” he continued, his eyes blazing, implying that the HFCs are hiding the NPAs and not presenting a true picture to their shareholders.
He also pointed out that while the Banks have confessed to their sins and reported the NPAs, the HFCs have not yet done so.
Sonia Shenoy shuddered in fright and muttered a silent prayer under her breath.
She is worried about the fate of the novices of Dalal Street.
Novices have tucked into stocks like DHFL, PNB Housing Finance, Repco Home Finance, IndiaBulls Housing Finance, L&T HF etc and already lost colossal sums of their capital.
It is worth recalling that these stocks were recommended to us at one time in the distant past on the basis that they are “Lakh Crore Ki Kahani“, meaning that we could reap incalculable gains from them.
Needle in a Haystack found by @Raamdeo Agarwal, PNB Housing Finance Limited Stock. What a Narrative! @varinder_bansal @CNBCTV18Live #Nifty pic.twitter.com/X1l7i2Oznf
— Rattan Joneja (@rattanjoneja) June 7, 2017
However, the slowdown in the realty sector coupled with LAPs (Loans against property) have taken a steep toll on these stocks.
In addition, the deadly ILFS scam has also wrecked havoc with these stocks.
All housing finance companies crack!
DHFL now down 25%
Indiabulls Housing down 10%
Repco down 5%
Can Fin down 5%— Mubina Kapasi (@MubinaKapasi) September 21, 2018
So, it is better we heed Sridhar Sivaram’s advice at this stage and lie low for the moment insofar as HFC stocks are concerned because it is quite likely that there may be more bad news in store.
This is scary for me.
Nearly Rs 1.3 lakh crore of NBFC borrowing from MFs coming up for repayment in Q1. NBFCs under stress will face serious issue for repayment. pic.twitter.com/Id9w6lxy2N— Varinder Bansal ?? (@varinder_bansal) April 26, 2019
#JustIn | DHFL defaults on interest & principle on NCDs worth Rs 197 cr pic.twitter.com/Q968BuMSUM
— CNBC-TV18 (@CNBCTV18Live) September 12, 2019
Outstanding opportunity now to buy small-cap and mid-cap stocks
Rakesh Jhunjhunwala, the Badshah of Dalal Street, was the first to advice us to buy stocks when they are available at steep discounts.
He explained that the “pessimism is overdone” and that stocks would rebound like rockets.
Speaking exclusively to ET Now, Big Bull Rakesh Jhunjhunwala says pessimism in the market is overdone and the 10,500-10,750 level in the Nifty would act as a floor.https://t.co/AK0O9lwGbe
— TIMES NOW (@TimesNow) August 26, 2019
Markets have bottomed out. This is good time to buy: Big bull Rakesh Jhunjhunwala #ETMarkets #MarketsNews #BizNews #MarketsUpdate https://t.co/Y9GCPPJIiD
— ETMarkets (@ETMarkets) September 12, 2019
Raamdeo Agrawal also offered the same advice.
“Jitni Mandi, utni jaldi Teji,” the savvy stock picker advised in his typical rustic manner.
Sridhar Sivaram endorsed this logic.
“The market is currently giving outstanding buying opportunities … there has been decimation of prices … there has been collateral damage to good stocks … these are best times to buy,” he advised.
It is a fact that we cannot delay the purchases any longer because several stocks are already up 40% in just the last two months.
Up to 40% jump in 2 months! 15 stocks that beat market volatility
Read more: https://t.co/xfYDzmcCGY #ETMarkets #Marketupdates pic.twitter.com/D9EOpGbjn7
— ETMarkets (@ETMarkets) September 12, 2019
Mid & smallcap stocks beat large peers; should you buy?
Read more: https://t.co/cBAR3eLiQ0 #ETMarkets #Marketupdates pic.twitter.com/zr41qAqnzO
— ETMarkets (@ETMarkets) September 12, 2019
Forget four wheelers, two wheeler stocks are a must buy
According to a theory formulated by Nirmala Sitharaman, the Hon’ble Finance Minister, the obsession of millennials with Uber and Ola Cabs, has played havoc with the sales of four-wheelers.
This is the reason why motor car manufacturers like Tata Motors, Maruti Suzuki etc are reeling under losses, according to her wisdom.
Finance Minister Nirmala Sitharaman attributing the slowdown in the auto sector to millennials preferring taxi-hailing services than buying a car and committing to EMI has come under sharp criticism: What does math say? @rajalakshmi_ns explains https://t.co/h7SriBOEE7
— Business Line (@businessline) September 12, 2019
However, Nirmala Sitharaman’s logic has not appealed to some intellectuals.
Sonia Shenoy is amongst those not impressed by the logic.
Sonia pointed out that economic slowdown is widespread and has nothing to do with the preferences of millennials.
Are millenials not interested in buying television sets anymore?
Nilesh gupta of Vijay sales tells CNBC TV18 television volumes are up only 4-5% over last 2 mths
Growth In TV Sales Has Stagnated despite prices Coming Down By 15-20% Due To Reduction In Panel Prices— Sonia Shenoy (@_soniashenoy) September 11, 2019
Sridhar Sivaram sensibly suggested that we skirt the controversy completely and instead tuck into two-wheeler stocks which are so far immune from the predatory practices of ride-sharing apps.
“When consumer discretionary start trading at consumer staples, I stay away. When they come back to discretionary valuations, that it is the time to buy,” he said, implying that the valuations are now at the bottom of the barrel.
Prima facie, the advice makes sense.
Two-wheeler stocks like Bajaj Auto, Hero Motocorp and TVS Motors are blue-chip, with high RoE, free cash flows and debt-free and may prove to be excellent investment opportunities given the insatiable demand for their products.
Buy Cement & Paint stocks
Cement stocks are regarded as an excellent proxy for the economy.
Sridhar Sivaram advised that we buy them now because they will be the first to surge as soon as the economy shows signs of revival.
This logic is appealing as well.
Stocks like Ambuja Cement and UltraTech Cement are fail-safe blue-chips which we can fearlessly add to our portfolios.
He also advised that we tuck into paint companies like Asian Paints, Berger Paints etc on the logic that these are “structural stories” and will prosper due to the shift from the ‘unorganized’ sector to the ‘organized’ sector.
asian paints, what a dream stock!hit a new high today.Marketcap of almost 1 lakh crore,bigger than M&M, Bajaj Auto and even ultratech cement
— Sonia Shenoy (@_soniashenoy) June 1, 2016
He is the analyst who had said that don’t invest in insurance cos, 6 months ago. They are overvalued. Everyone remembers only selectively
Most of us have very short memory and that’s why these kind of people thrive and rant their advises every where/every now and then. I think RJ should keep a track of such things and advise caution to its valuable readers who follow the site diligently.
Sridhar Sivaram of Enam Holdings said not to invest in information technology (IT) stocks. This advice was totally wrong. He admitted to this in the CNBC interview.
All these experts and that stupid channel CNBC is all bakwaas,, they just tell what is currently happening in the market and extrapolate it to future,
bettter watch them only for fun not for serious investments, especially the expert opinions…….. they know only as much as any one of us know about the future
except their command of english is good and so the seem to be experts
read Peter Lynch book “ONE UP ON WALL STREET”
Pick your 10 to 15 stocks and hold for a long time. you will be wealthy
The question is what are those stocks 10-15 stocks that makes one wealthy. Investors who held on to ILFS, YES, DHFL, LEEL, VAKRANGEE, RAIN, MANPASAND, INDIA BULLS etc., for long term wiped out.