Any updates on outlook after Q2 FY24 concall.
Hi, can anyone please share the registration link or connection details for todayās Earnings Call?
BANDHAN BANK HAS GIVEN LOAN OF RS 22750/-CR.
85% has already paid by customer.
Pending amount Rs 3310cr.
bank has received 927 and 300cr additionally from customer and authority.
Now remaining amount is 2283cr. Bank has made provision 88% which comes to 2009cr.
Remaining amount is just 280cr. Calculated conservatively.
I am holding the shares.
4 Likes
NCGTC forensic audit of evergreen loans
Same issues are raised last year around April 2023.
Waiting for the outcome to size the issue (if they found any)
2 Likes
I am reading about this business and trying to answer the question - Why is the stock price under tremendous pressure? Few things that caught immediate attention were:
- Lack of growth in Housing Finance portfolio: Merged GRUH, which had a portfolio of ~ā¹181 bn, in Dec19. GRUH as an independent company used to grow at ~20% CAGR, implying an expected loan book of ~ā¹375 bn by Dec23. However, overall Housing Asset as on Dec23 is ~ā¹284 bn. In the last 4 years, two heads for āHousing Financeā have moved out.
- Uncertainty due to the ongoing forensic audit initiated by National Credit Guarantee Trustee Company Ltd. (NCGTC).
- Higher unsecured book | Geographical concentration | Loan book concentration: These 3 are being mitigated slowly by the management. However, they seem to be progressing slowly.
@manhar : Would appreciate your latest view since you would have reflected on this business for more than a year now.
2 Likes
Hi sir,
I sold them about a year back, I am not tracking them anymore.
The biggest learning for me was banking is like quick sand you donāt know the end, you donāt know how bad the book is , them moment you think thing are improving you are going deeper and deeper into the sand.
I though they were over provisioned and now we can see some write backs, lol a banker would never even in his dream writeback, max he can do is less provision next qtr
The point is I tried to predict the recover and my lesson was in banks the cycle are long donāt predict let them show some sigh of recovery, let them show 2 good qtrs, you donāt have to buy it at bottom, we can miss some 20%, 30% return
@Surender donāt have much to say on business , just these small learnings
Disc- sold 1yrs back
5 Likes
My few takes on banking / NBFC
- Financial industry is backbone of Indiaās economy and their health/stability is important for economic growth to sustain.
- Hence these are highly regulated industry
- RBI is now continuously monitoring them to predict early warning signals and then reduce/mitigate any structural weaknesses that may arise.
- As per me this is good for long term sustained and stable growth (especially during downturn) of the economy and the banks as well.
- RBI is also ensuring that there is significant transparency and reasonableness to the charges they avail from clients, especially retail customers, this will show some dip in fee income from penal charges etc.
- The above points are giving me confidence of investing in low valued/corrected stocks like Bandhan.
- However donāt think sustainability of very high valuation (Bajaj Finance, for instance) in this segment is possible.
Bandhan_Bank_13Mar24_Kotak_Inst.pdf (484.8 KB)
CEO Chandra Shekhar Ghosh resigns!
We will never know whether he resigned due to āretirementā or RBI action forced him,seeing the performance of the bank in last few years and ngctc audit latter seems to have more weight because in 2021 they had sought a 5 year extension for his tenure but RBI granted only 3 years extension.
1 Like
Kotak Buy recco reason
We took a call to be positive on the bank based on the following metrics, but note that the current development would weigh in a little to our reasons.
(1) There has been an improvement in asset-quality metrics in recent quarters, though stress is still higher than peers. While we have no visibility on the outcome of the independent audit, we made a macro call that the microfinance industry is largely returning to normalcy and Bandhan would soon follow suit.
(2) The liability franchise was largely unaffected by this crisis.
(3) The bank was steadily strengthening its senior management team, and our recent conversation suggested that the current team has the requisite experience to carry the bank forward.
(4) Mr Ghosh would continue to oversee the bank.
(5) Bandhan Bank was relatively inexpensive (given the above factors) in the segment in which it is operating. The risk-reward appeared to be favorable.
Bandhan_Bank_08April2024_Kotak_Insti.pdf (455.2 KB)
2 Likes