Latest news with #EmkayGlobalFinancialServicesLtd
Mint
07-08-2025
- Business
- Mint
Trump doubles tariff on India for Russian crude oil imports; what does it mean for Indian stock market?
US President Donald Trump has imposed an additional 25% tariff on Indian imports as a 'penalty' for New Delhi's continued purchase of Russian crude oil. This move takes the total US tariff burden on Indian exports to 50% — 20% higher than that on Chinese goods — significantly denting India's export competitiveness. The new tariff structure, announced late Wednesday, will come into effect after a 21-day grace period, starting August 27, 2025. While this window leaves room for a negotiated resolution, the options appear limited for both sides. 'We expect the markets to fall by 1-2% in a knee-jerk reaction, but most would expect a resolution of the same,' said Dhiraj Relli, MD & CEO of HDFC Securities. He estimates that if the tariffs remain in place for a full year, India's GDP could take a 30 – 40 basis point hit. Export-oriented sectors such as IT services, textiles, engineering goods, pharmaceuticals, and auto components are expected to bear the brunt. Additionally, retaliatory tariffs from India could trigger a wider US–India trade conflict, he added. 'Market participants will hope that these negotiations will resolve the issue before the actual implementation of the duties,' Relli said. According to Seshadri Sen, Head of Research and Strategist at Emkay Global Financial Services Ltd, the 21-day buffer period leaves open the possibility of sectoral exemptions or negotiated relief. 'As it stands, this could bring exports from affected sectors - textiles, jewelry, auto ancillaries - to a standstill and hurt some of India's labor-intensive sectors. We, however, see the broader economy staying resilient and remain convinced of a 2HFY26 consumption-led recovery,' Sen said. He advises investors to buy the dip if market correction exceeds 5%, given the limited direct earnings impact on the listed universe and more attractive valuations below long-term averages. Sen identifies the most sectors and stocks impacted by the US tariffs: Textiles: Gokaldas Exports, Kitex Garments Chemicals: Camlin Fine Sciences, Aarti Industries, Atul Ltd Auto Ancillaries: Bharat Forge, Suprajit Engineering, Sona BLW Precision Forgings If India cuts Russian crude imports as part of the settlement, Reliance Industries and the oil marketing companies (OMCs) are vulnerable – also, crude prices could spike, he added. Pharmaceuticals and electronic manufacturing services (EMS) appear to be exempt from the tariff list for now. However, Sen cautions that sentiment around EMS stocks could be impacted depending on an announcement from Apple. Sen outlines a cautious yet opportunistic investment strategy: 1. Look through the near-term volatility. 'Trying to trade this uncertainty is highly risky. There are multiple variables at play – renegotiated tariffs, sectoral carve-outs and carve-ins, and India slowing Russian oil imports.' 2. Minimize exposure to export-oriented and globally exposed sectors. 'Even if the final trade agreement is not as bad as it appears now, a sharp slowdown in the global economy looks inevitable' 3. Buy the dip: If the market correction goes above 5% from here, valuations would then be comfortable at well below the LTA and, the direct impact on the listed universe earnings is negligible. Also, this does not impede India's 2HFY26 cyclical growth recovery, which is largely driven by domestic impulses. 4. Stick to sector preferences: Emkay maintains an overweight (OW) stance on Consumer Discretionary and Industrials, and an underweight (UW) view on Financials, Technology, and Consumer Staples. Disclaimer: The views and recommendations made above are those of individual analysts or broking companies, and not of Mint. We advise investors to check with certified experts before making any investment decisions.
Mint
21-07-2025
- Business
- Mint
Yes Bank share price gains over 2% after Q1 results. Should you buy, sell or hold?
Yes Bank share price gained over 2% in early trade on Monday after the lender reported its Q1 results. Yes Bank shares rallied as much as 2.13% to ₹ 20.60 apiece on the BSE. Yes Bank reported a standalone net profit of ₹ 801 crore in the first quarter of FY26, registering a growth of 59% compared to ₹ 502 crore in the same quarter last year. The bank's net interest income (NII) in Q1FY26 increased by 5.7% year-on-year (YoY) to ₹ 2,371 crore, led by a fall in the cost of funds. Net interest margin (NIM) improved to 2.5%, while operating profit increased by 53.4% YoY to 1,358 crore. Asset quality during the June quarter remained stable, as Gross NPA and Net NPA remained unchanged sequentially at 1.6% and 0.3%, respectively. Provisions in Q1FY26 declined to ₹ 284 crore from ₹ 317 crore, QoQ. Anand Dama, Senior Research Analyst at Emkay Global Financial Services Ltd noted that Yes Bank's core performance remained weak, with credit growth slowing to 5% YoY and down 2.1% QoQ, while margins remained low at 2.5%. 'However, higher treasury gains led to an earnings beat. The bank expects NIM to slip in Q2 due to lending rate cuts. Yes's retail portfolio continues to exhibit stress with a slippage ratio of 2.5%, which we believe has led to management churn. The bank's CET 1 (~13.3%) is sub-par among peers, and would thus call for frequent dilution,' Dama said. Recently, SMBC agreed to acquire a 20% stake in Yes Bank from SBI (13.19% of the 24% sold) and other banks (6.81% of the total 9.7% stake sold) at a sale price of ₹ 21.5 per share (implying 1.3x FY27E ABV). However, the transaction is still pending RBI approval and so the bank has halted its search for a new CEO, he highlighted. Factoring in the Q1 beat, Emkay Global revises up FY26E EPS estimates by 5% and in turn its Yes Bank share price target by 6% to ₹ 17 apiece from ₹ 16. However, the brokerage firm retains a 'Sell' rating on Yes Bank shares, given sub-par growth, return ratios and higher valuations (1.2x FY27E ABV). At 9:30 AM, Yes Bank share price was trading 0.20% higher at ₹ 20.21 apiece on the BSE. Disclaimer: The views and recommendations made above are those of individual analysts or broking companies, and not of Mint. We advise investors to check with certified experts before making any investment decisions.
