In April 2022, we had issued a buy recommendation on a general insurance player, as both the industry and the company itself were emerging from the Covid-driven impact and were poised for growth. Since then, however, the insurance sector has lost market favour as growth has not panned out as expected.
When we gave the call of this R&D focused company engaged in the manufacture of enzymes and probiotics, the company had Covid-related challenges but showed promise of growth. It was later also pulled down by consolidation of acquisitions and costs related to new product launches. We therefore knew that the call would take longer to pay off. The stock went through a significant correction after our initial recommendation as earnings disappointed.
In March 2021, our call on the commodities fund we added panned out well. But we decided to issue a book profit call in June 2022, as we wanted to preserve some of the profits given the cool off that was visible then in commodity prices.
And as anticipated, commodities cooled off a fair bit globally. Triggered by inflation-driven rate hikes and recession fears, pre-emptive physical destocking (reducing inventories anticipating higher cost of holding inventories) resulted in lower prices. The traded Goldman Sachs Commodity index graph below will tell you that our call was largely in line with this index’s move.
With the Budget plugging the tax break on guaranteed income plans from insurers, annuity plans are back in the picture as the go-to option for investors seeking guaranteed payouts after retirement. LIC has recently relaunched its popular deferred annuity plan as New Jeevan Shanti (Plan No. 858).
Let’s see how good the plan is and how it stands against competition in today’s Prime review.
Covid proved be an ultimate stress test for Small Finance Banks (SFBs). As SFBs largely cater to low income borrowers comprising small businesses, small vehicle owners and other self-employed categories including micro-finance, they were among the most Covid-sensitive sectors.
The Adani saga (still continuing, I guess) brings forth the issue of governance, management quality, and other qualitative factors that many investors consider as essential check boxes. During the time I spent in CRISIL, ‘management quality’ would set a cap on ratings. But what is ‘management quality’?
Legal Disclaimer : PrimeInvestor Financial Research Pvt Ltd (with brand name PrimeInvestor) is an independent research entity offering research services on personal finance products to customers. We are a SEBI registered Research Analyst (Registration: INH200008653). The content and reports generated by the entity does not constitute or is not intended to constitute an offer to buy or sell, or a solicitation to an offer to buy or sell financial products, units or securities. All content and information are provided on an ‘as is’ basis by PrimeInvestor Financial Research Pvt Ltd. Information herein is believed to be reliable but PrimeInvestor Financial Research Pvt Ltd does not warrant its completeness or accuracy and expressly disclaims all warranties and conditions of any kind, whether express or implied. The services rendered by PrimeInvestor Financial Research Pvt Ltd are on a best-effort basis. PrimeInvestor Financial Research Pvt Ltd does not assure or guarantee the user any minimum or fixed returns. PrimeInvestor Financial Research Pvt Ltd or any of its officers, directors, partners, employees, agents, subsidiaries, affiliates or business associates will not liable for any losses, cost of damage incurred consequent upon relying on investment information, research opinions or advice or any other material/information whatsoever on the web site, reports, mails or notifications issued by PrimeInvestor Financial Research Pvt Ltd or any other agency appointed/authorised by PrimeInvestor Financial Research Pvt Ltd. Use of the above-said information is at the user’s own risk. The user must make his own investment decisions based on his specific investment objective and financial position and using such independent advisors as he believes necessary. All intellectual property rights emerging from this website, blog, and investment solutions are and shall remain with PrimeInvestor Financial Research Pvt Ltd. All material made available is meant for the user’s personal use and such user shall not resell, copy, or redistribute the newsletter or any part of it, or use it for any commercial purpose. PrimeInvestor Financial Research Pvt Ltd, or any of its officers, directors, employees, or subsidiaries have not received any compensation/ benefits whether monetary or in kind, from the AMC, company, government, bank or any other product manufacturer or third party, whose products are the subject of its research or investment information. The performance data quoted represents past performance and does not guarantee future results. Investing in financial products involves risk. Investments are subject to market risk. Please read all related documents carefully. As a condition to accessing the content and website of PrimeInvestor Financial Research Pvt Ltd, you agree to our Terms and Conditions of Use, available here. This service is not directed for access or use by anyone in a country, especially the USA, Canada or the European Union countries, where such use or access is unlawful or which may subject PrimeInvestor Financial Research Pvt Ltd or its affiliates to any registration or licensing requirement.
Investment in securities market are subject to market risks. Read all the related documents carefully before investing.
Compliance Officer Details: Name: Srikanth Meenakshi; Email: contact@primeinvestor.
Grievance Officer Details: Name: Srikanth Meenakshi; Email: contact@primeinvestor.
