Professional Documents
Culture Documents
RBI Monetary Policy Review
RBI Monetary Policy Review
RBI Monetary Policy Review
Vaibhav Agrawal
022 3935 7800 Ext: 6808 vaibhav.agrawal@angelbroking.com
Shrinivas Bhutda
022 3935 7800 Ext: 6845 shrinivas.bhutda@angelbroking.com
Varun Varma
022 3935 7800 Ext: 6847 varun.varma@angelbroking.com
Sep-07
Sep-08
Sep-09
Sep-10
May-07
May-08
May-09
May-10
Source: MOSPI, Bloomberg, Angel Research; Note: WPI inflation forecasted figures from October 2011, based on historical correlation with Reuters CRB Index
May-11
Sep-11
Jan-08
Jan-09
Jan-10
Jan-11
As a corollary impact of the savings deregulation, we believe it will become all the more unattractive for banks to hold any excess SLR and, hence, we maintain an upward bias on government bond yields, which is likely to be exacerbated by this development. This will increase the negative earnings impact on banks with a higher proportion of high-duration SLR holdings in the AFS segment. We have recalibrated our target P/ABV multiples for this change in regulation and will look to revise earnings estimates depending on the actual changes in rates in the coming weeks. In our view, among banks that are expected to gain the most from this move will be new-age banks such as Yes Bank. These banks will also gain from further liberalization of branch-licensing norms, in terms of not requiring RBI approval for opening branches in Tier 2 to Tier 6 centers. We maintain our Buy recommendation on Yes Bank with a target price of `347, implying an upside of 23.4% from current levels. Amongst the PSU banks, the banks that stand to benefit the most include Corporation Bank on which we maintain our Buy rating with a target price of `489, implying an upside of 20.8%.
4.5
(6) (6) (5) (5) (4) (4) (4) (4) (3) (3) (2) (2) (1) (1) (1) (1) (1) (1) (1) (1) (0) (0) (0) (0) 2 4 7 (3)
5.0
(13) (11) (11) (10) (8) (8) (8) (7) (7) (6) (4) (4) (3) (2) (2) (2) (2) (2) (1) (1) (1) (1) (0) (0) 4 8 13 (5)
5.5
(19) (17) (16) (16) (13) (12) (12) (11) (10) (9) (6) (6) (4) (4) (3) (3) (3) (3) (2) (2) (1) (1) (1) (0) 6 12 20 (8)
6.0
(26) (22) (21) (21) (17) (17) (16) (15) (14) (12) (8) (8) (6) (5) (4) (4) (3) (3) (3) (2) (2) (2) (1) (0) 8 16 27 (10)
4.5
(4.2) (5.6) (6.1) (3.0) (3.7) (2.8) (1.5) (2.9) (4.2) (1.8) (1.7) (2.0) (0.7) (0.7) (0.5) (0.9) (0.7) (0.5) (0.6) (0.8) (0.5) (0.3) (0.2) (0.1) 1.6 4.0 3.6 (1.7)
5.0
(8.5) (11.3) (12.1) (6.0) (7.3) (5.5) (3.1) (5.8) (8.3) (3.6) (3.5) (4.0) (1.4) (1.5) (1.0) (1.7) (1.3) (1.0) (1.3) (1.6) (0.9) (0.6) (0.4) (0.1) 3.2 8.1 7.2 (3.5)
5.5
(12.7) (16.9) (18.2) (8.9) (11.0) (8.3) (4.6) (8.6) (12.5) (5.5) (5.2) (6.1) (2.1) (2.2) (1.6) (2.6) (2.0) (1.4) (1.9) (2.5) (1.4) (0.9) (0.6) (0.2) 4.8 12.1 10.8 (5.2)
6.0
(17.0) (22.6) (24.3) (11.9) (14.7) (11.1) (6.1) (11.5) (16.6) (7.3) (6.9) (8.1) (2.8) (3.0) (2.1) (3.4) (2.6) (1.9) (2.5) (3.3) (1.8) (1.2) (0.8) (0.3) 6.4 16.2 14.3 (6.9)
Source: Company, Angel Research; Note: SA: Saving Account, scenario analysis is a based on various saving interest rates
Source: Company, Angel Research; Note:*Target multiples=SOTP Target Price/ABV (including subsidiaries), #Without adjusting for SASF
E-mail: research@angelbroking.com
Website: www.angelbroking.com
DISCLAIMER
This document is solely for the personal information of the recipient, and must not be singularly used as the basis of any investment decision. Nothing in this document should be construed as investment or financial advice. Each recipient of this document should make such investigations as they deem necessary to arrive at an independent evaluation of an investment in the securities of the companies referred to in this document (including the merits and risks involved), and should consult their own advisors to determine the merits and risks of such an investment. Angel Broking Limited, its affiliates, directors, its proprietary trading and investment businesses may, from time to time, make investment decisions that are inconsistent with or contradictory to the recommendations expressed herein. The views contained in this document are those of the analyst, and the company may or may not subscribe to all the views expressed within. Reports based on technical and derivative analysis center on studying charts of a stock's price movement, outstanding positions and trading volume, as opposed to focusing on a company's fundamentals and, as such, may not match with a report on a company's fundamentals. The information in this document has been printed on the basis of publicly available information, internal data and other reliable sources believed to be true, but we do not represent that it is accurate or complete and it should not be relied on as such, as this document is for general guidance only. Angel Broking Limited or any of its affiliates/ group companies shall not be in any way responsible for any loss or damage that may arise to any person from any inadvertent error in the information contained in this report. Angel Broking Limited has not independently verified all the information contained within this document. Accordingly, we cannot testify, nor make any representation or warranty, express or implied, to the accuracy, contents or data contained within this document. While Angel Broking Limited endeavours to update on a reasonable basis the information discussed in this material, there may be regulatory, compliance, or other reasons that prevent us from doing so. This document is being supplied to you solely for your information, and its contents, information or data may not be reproduced, redistributed or passed on, directly or indirectly. Angel Broking Limited and its affiliates may seek to provide or have engaged in providing corporate finance, investment banking or other advisory services in a merger or specific transaction to the companies referred to in this report, as on the date of this report or in the past. Neither Angel Broking Limited, nor its directors, employees or affiliates shall be liable for any loss or damage that may arise from or in connection with the use of this information. Note: Please refer to the important `Stock Holding Disclosure' report on the Angel website (Research Section). Also, please refer to the latest update on respective stocks for the disclosure status in respect of those stocks. Angel Broking Limited and its affiliates may have investment positions in the stocks recommended in this report.
CSO & Registered Office: G-1, Ackruti Trade Centre, Rd. No. 7, MIDC, Andheri (E), Mumbai - 400 093.Tel.: (022) 3083 7700. Angel Broking Ltd: BSE Sebi Regn No: INB010996539 / PMS Regd Code: PM/INP000001546 / CDSL Regn No: IN - DP - CDSL - 234 - 2004 / NSE Sebi Regn Nos: Cash: INB231279838 / NSE F&O: INF231279838/ Currency: INE231279838 / MCX Currency Sebi Regn No: INE261279838 / Member ID: 10500 / Angel Commodities Broking Pvt. Ltd: MCX Member ID: 12685 / FMC Regn No: MCX / TCM / CORP / 0037 NCDEX : Member ID 00220 / FMC Regn No: NCDEX / TCM / CORP / 0302