We believe the market considers HDFC Bank to be immune from the bad loan cycle, even though it is a mainstream, large bank. Peer private banks in India are showing worsening credit metrics, and indeed there are signs of this with HDFC Bank when delving through its filings. Perspective is also important, where over the past 21 years, HDFC Bank has in the past participated fully in the NPL cycle. India corporate financial health is also not reassuring, where HDFC Bank is actually more corporate focussed than many believe.
HDFC Bank is a commercial banking group based in India. Co. is engaged in providing banking and financial services. Co.'s operations are organized along four segments: Treasury, which includes its investment operations; Retail Banking, which serves retail customers with deposit products, loans and other services through a branch network and other delivery channels; Wholesale Banking, which provides loans, non-fund facilities and transaction services to corporations, public sector units, government bodies, and medium scale enterprises; and Other Banking Business, which includes para banking activities such as credit cards and debit cards.
We provide research and consultancy on Asian banks. Our focus is on what we call “Asian bank research, without the noise.” We are interested in the most critical swing-factors for banks, the NPL and credit cycle, and where we believe there is a gap between perception and reality. We often focus on the less studied components of bank financial statements. Our research is highly thematic, sometimes examining unlisted banks and companies as a window on mainstream banks.
Being independent allows us to look at smaller banks, often overlooked by others. Analysis of BIS bank guidelines in the context of Asia, is also a focal point, while we also analyze global banks operating in the region. We use what we believe is the most comprehensive, reliable financials database, SNL Financial. S&P Capital IQ augments our database, with corporate data and CEIC, with economics.
Daniel Tabbush has been highly ranked by Asiamoney, Bloomberg and The Asset for his Asian bank analysis, which began more than 20 years ago, and making him the longest standing Head of Asian Bank research in Asia. Tabbush made his name analyzing banks in Thailand, highlighting bad loan risks for Thai banks before and after the Thai Financial Crisis of 1997.
He is known for extolling the unusual positives of Japan’s mega banks in 2005, and the risks likely to hit HSBC from its U.S. subprime loan operations, in 2006. More recently, when most were concerned with nearly all Western banks in late 2008, Tabbush highlighted the positive outlook for Standard Chartered Bank at that time.
He was Head of Asian Bank research for 10 years at the top rated CLSA, overseeing 10 analysts in Asia and coverage of approximately 80 banks. In this role, he spearheaded bank coverage in Japan and Australia. Tabbush was also responsible for research of HSBC and Standard Chartered Bank. Prior to this role, he was the Managing Director of CLSA Securities (Thailand) and its Head of Research. Daniel began his stock-broking career in Thailand in 1993 at Swiss Bank Corp, where his focus was on Thai Banks, after which he joined CLSA in 1996. Daniel grew up in Los Angeles, graduated from University of California, San Diego in Economics, cum laude and with Phi Beta Kappa honors. He lives with his wife and kids in Bangkok and he enjoys running, cooking and playing chess.
Since leaving the stock broking industry in 2012, he has run his Tabbush Report research and consultancy business.
Eighteen Directors at HDFC Bank Ltd sold after exercising options/sold 168,150 shares at between 1,250.000INR and 1,272.000INR. The significance rating of the trade was 96/100. Is that information sufficient for you to make an investment decision? This report gives details of those trades and adds context and analysis to them such that you can judge whether these trading decisions are ones worth following. Included in the report is a detailed share price chart which plots discretionary trades by all the company's directors over the last two years clearly showing Close periods where trading a...
HDFC BANK: In-line performance; prudential provisioning to facilitate steady earnings growth (HDFCB IN, Mkt Cap USD94.3b, CMP INR2376, TP INR2750, 16% Upside, Buy) HDFCB reported 1QFY20 PAT of INR55.7b (+21% YoY, in-line). The bank stepped up provisions on the unsecured book, created a contingent provision of INR1.6b and additional general provision of INR0.9b toward the NBFC/HFC sector. NII grew 23% YoY to INR132.9b (in-line), while margins contracted 10bp QoQ to 4.3%. Core fee income grew 12% YoY to INR35.5b; treasury gain of INR2.1b boosted other income growth to 30% YoY. Opex gre...
HDFC Bank: Getting bigger, better and stronger; Growth momentum intact; competitive positioning to improve (HDFCB IN, Mkt Cap USD94.5b, CMP INR2416, TP INR2780, 15% Upside, Buy) Takeaways from the Annual Analyst Meet We attended HDFC Bank’s (HDFCB) Annual Analyst Meet, wherein the bank highlighted the progress that its different businesses are making and the steps being undertaken to maintain its strong competitive positioning and deliver sustainable growth. HDFCB remains confident about its strategy to deepen presence in the suburban and rural regions and offer full product suite to cus...
It is a myth that China corporates are deleveraging. There is no indication of this from company data or from bank data. Rather, corporates are re-leveraging. Over the latest full year, total debt of China’s non-financial companies rose dramatically, by US$431 billion. This change is higher than any year in the past five and at 19% growth YoY, it far surpassed the previous three years. Our corporate data shows most growth was with the most distressed companies, those with debt/ebitda at >7x. This makes it important to understand that large banks are giving up corporate loan share, while small ...
The magnitude of Tisco Financial Group’s (TISCO) net interest margin (NIM) expansion is tremendous. Of 72 Asian banks, Tisco’s NIM expansion ranks third, at +108bps from 2015 to 1Q18. The figures are not flattered from being low, where its NIM is now 4.58%, one of the highest in Asia.
The turnaround at Philippine National Bank (PNB) accelerates in 1Q18. Where the bank reinstated its dividend in 2016 it is still early days in its transformation. But 1Q18 data is reassuring. Net interest margins (NIM) rose to 3.44% in 1Q18 from 3.12% last year, and marks a directional change.
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