activity is slowing down in both advanced (AE) & emerging economies (EME).
Inflation continued to remain low due to slowing global growth.
yields softened in US, turned negative in Germany & Japan as central banks
signaled softer stances.
second advanced estimates for 2018-19 by Central Statistics Office revised the
GDP downwards to 7% from 7.2% earlier.
has kept the neutral stance with objective of meeting medium term target of
inflation (CPI) of 4%.
has revised the inflation downwards to 2.4% in Q4:2018-19, 2.9-3% in H1:2019-20
& 3.5-3.8% in H2:2019:20.
growth for FY20 has been revised downwards to 7.2% from 7.4%.
Global economy is slowing down. It is clearly showing the
impact on domestic economic movement. Major central banks in the world are
softening their stance. RBI has also softened the stance and has done 2 rate
cuts in this calendar year so far. We are expecting more rate cuts to boost the
economic growth. IFM expects yields will continue to soften. Thus, debt market
is providing great investment opportunity at current movement.
It is pure large cap fund where fund manager’s investible basket is the NIFTY 50 companies only. The objective
of the fund is to outperform the benchmark (NIFTY 50)
without increasing the underlying risk.
On performance attribution analysis in fourth quarter of FY19, largecap strategy has outperformed the benchmark (NIFTY 50) return by 3.2%. Largecap strategy has delivered the absolute return of 10.2% in Q4FY19 against the benchmark (NIFTY 50) return of 7%. On the basis of risk attribution analysis, the outperofrmance came with the portfolio beta of just 1.06. So, the additional return on the portfolio was not because of the additional risk but due to the right selection & right allocation.
Top Performers of Q4FY19:
Yes Bank Ltd.
Axis Bank Ltd.
Top Losers of Q4FY19:
Eicher Motors Ltd.
Top 5 Company Holdings as on 31-Mar-19:
HDFC Bank Ltd.
Tata Consultancy Services Ltd.
Top 5 Sector Holdings as on 31-Mar-19:
Oil & Gas
Petroleum Corporation Ltd (HPCL) has moved out of NIFTY 50 on 31st March 2019. Britannia Industries Ltd.
has been included in the NIFTY 50 index.
The first quarter
of FY20 will remain very volatile due to domestic political event. Our strategy
will be to book profits
where internal targets are met and continue to keep high cash in the portfolio.
CY2017, markets had given exceptionally well returns. This was the time when
markets were making new highs every other day. NIFTY had delivered the 28.6%
return, whereas NIFTY Midcap & NIFTY Smallcap had delivered 55-60% return
in single year. High liquidity was the primary reason to that rally. In CY2017,
NIFTY witnessed the growth of 28.6% while NIFTY earnings grew by just 5%. It
led the Price – earnings ratio of NIFTY to reach at 26.92 (as shown in the
table) by end of CY2017 and had made the markets overvalued.
1 Year Return
the end of CY2017, we at IFM were not comfortable with equity markets due
gigantic valuations. We were expecting that even in optimistic scenarios
markets will not go & sustain beyond 11000 by 2018 end. So we recommended
the clients to book the profits, avoided midcaps & smallcaps and remained stick
to debt funds (accrual theme), balanced funds and largecap funds as per their
CY2018, markets witnessed rollercoaster ride & remained highly volatile
through the year. NIFTY ended the year with marginal 3% gain whereas NIFTY Midcap
and NIFTY smallcap are down by 15-30%. It clearly shows that there is huge pain
in the markets. Investors who stayed invested in midcaps and smallcaps burnt
forward, Earnings growth is still not picking up and markets are trading at PE
of 26 which is still very high. 2019 is also going to be volatile due to global
factors, future earnings growth, elections, crude oil prices and currency.
A buyback is a transaction in which a company buys back its own shares. It is capitalization of its own surplus cash. hence it can also be viewed as an alternative to cash dividends. Shares that have been issued and subsequently buyback are classified as treasury shares. They are not then considered for dividends, voting rights or computing earnings per share(EPS). Some of the basic reasons for share buyback or repurchase are:
1. Management perceived shares in the company to be undervalued in the market place or more generally to support the share price. Company intrinsic value is more than market price.
2. There is no better opportunity to deploy cash, which can generate better returns than cost of capital.
3. Tax efficiency in distributing cash, in market in which the tax rate on cash dividends exceeds the tax rate on capital gains.
4. To absorb increase in share outstanding resulting from the exercise of employee stock options.
5. Capitalization of reserve and surplus to improve ROE.
Various share buyback method used by the companies are:
Iqbal Singh, Managing Director of IFM along with other panellist featured in today’s The Economic Times for investor education initiative- SWATANTRA powered by ET Now and UTI.
The UTI Mutual Fund’sT Swatantra on ET Now, after a short break of a few weeks, moved to Chandigarh in the third week of November. In this city in norther India, a panel of experts that included Iqbal Singh of Innovative Financial Management, Deepak Kumar Bhardwaj of The Capital Investment Advisory Services, Shobhit Gupta of Read more ›
Company has reported marginal rise of 1.19% (Y-o-Y) & huge decline of 29.3% (Q-o-Q) in profit after tax at 12.74 cr. for the quarter ended September 30, 2015 as compared to the quarters ended September 30, 2014 and June 2015. Net Revenues grew by 15.05% on Y-o-Y basis and declined by 17.07% on Q-o-Q basis.
Company’s margins have shrunk massively this quarter because of massive operating expenditures rise of 35%. Company’s Gross Profit Margin is 52.66%. It has declined by 701 basis points on Y-o-Y basis and 1137 basis Q-o-Q basis. PAT margin has also slipped by 305 and 385 basis points compared to same quarter last year and Read more ›
Company has posted not good results. On the consolidated basis, for the current quarter ended September 30, 2015 company has reported 41.1% decline & 14.7% rise in net profit and 46% decline & 11.5% rise (ex. Exceptional items) in Profit after tax as compared to for the same quarter in the previous year ended September 30, 2014 and for previous quarter ended June 30, 2015. Net Revenues of the company has decreased by 14.7% on Y-O-y basis and increased marginally by 4.3% on Q-o-Q basis.
Company had incurred exceptional losses of 685 cr. in previous quarter ended June 30, 2015. Exceptional expenses are not ordinary expenses and occur rarely and have no impact in future earnings. So we have filtered those effects. Latest Key Indicators of the stock are as follows: Read more ›
Company has posted better returns than what was expected. On the consolidated basis, the company has reported 104.4 % & 8% rise in net profit and 157.6% & 4.4% rise in Profit after tax for the quarter ended September 30, 2015 as compared to for the same quarter in the previous year (Q2 FY15) and for the last quarter (Q1 FY16). Net Revenues (consolidated) of the company has increased by 14.1% and marginally decreased by 2.3% for quarter under review as compared to the quarter ended September, 2014 and June, 2015 respectively. These extraordinary results were also due to drastic drop in exceptional expenses.
Exceptional expenses are not ordinary expenses and occur rarely and have no impact in future earnings. So we have filtered those effects. Excluding exceptional expenses, Net profit and Profit after tax grew by 63.5% on Y-o-Y basis, which are much better than both industry and its own past performance.
Latest Key Indicators of the stock are as follows: Read more ›
On the consolidated basis, Amara Raja Batteries Ltd. has reported 22.20% rise in its net profit after taxes on Y-o-Y basis and minute rise of 0.39% in net profit on Q-o-Q basis. Total income of the company has increased by 9.25% & 1.16% at Rs 1158.29 crore for quarter under review as compared to the quarter ended September 30, 2014 and quarter ended June 2015.
After years, reported top line growth remained below two digit numbers. Commenting on the Q2 performance, Mr. S V Raghavendra, Chief Financial Officer, said, “During the quarter, prices of major raw materials have been lower but the gains were partly offset by sharp depreciation of rupee against dollar. The reduced prices were passed on to the customers as per the contractual obligations resulting in marginal reduction in top line. However, the realization per unit for certain products and services have been better on account of cost improvements and better value proposition to various customers. The operating cash flow generation remained strong driven by improved profitability. The Company continues to have healthy liquidity position. The major projects of Read more ›
Axis Bank Ltd. has reported good financial results in the current quarter. On the consolidated basis, company has reported 18.93% rise and 3.17% decline in net profit compared to same quarter last year & previous quarter respectively.
Gross Interest income reported at Rs. 9,960 Cr. Grew by 15.58% and 0.24% for the quarter under review as compared to the quarter ended September, 2014 and June, 2015 respectively. Net interest income at Rs. 4,062 Cr. grew by 15.24% & 0.14% on Y-o-Y basis & Q-o-Q basis and net interest margin stood at 3.85%. Other income (majorly fee income) is 17% of total income. Core operating income (excluding earnings on sale of investments) increased by 19.67% at Rs. 3460 Cr.
Asset quality of the bank deteriorated marginally. The bank’s Gross NPA and Net NPA for the July-September quarter of the current fiscal increased to 1.38% and 0.48% as compared to 1.34% and 1.34% in the same quarter of the previous year respectively.
Proportion of CASA as on 30-Sep-2015 stood at 44%. Return on assets was 1.64%.
Latest Key Indicators of the stock are as follows: Read more ›