Budget 2022

Axis bank’s earnings beat our estimates by 18.4%, led by better than expected asset quality performance (GNPA/NNPA ratios lowest since 2QFY17). Strong loan growth across segments and improvement in margins resulted in a 6.7% beat on NII. On the back of better than expected loan growth and improving asset quality trends, we upgrade FY22/23ii PAT by 9.2/1.3% and largely maintained for FY24.

Telecommunication players are ready to launch 5G connection. BHARTI is one of the players who is looking to increase their business IN 5G. Google will also invest up to $2billion in Bharti Airtel for India digitization fund. So the budget announcement would be beneficial for Bharti Airtel.

Buoyant end-market outlook and swift recovery in business operations have fast-tracked CG Power’s performance ramp-up to Rs50bn sales and Rs5bn PBT within a year vs 3 years targeted initially. After having broadly fixed the legacy issues, management with the help of a consultant will drive operational efficiency initiatives, which will not only improve OPMs and RoCE from FY23 but step-up cashflows for investing back in R&D, technology upgrade, and expansion. To further its long-term aspiration and build a consumer portfolio of similar size as CG, it will launch fans portfolio in FY22 using its existing distribution & reach. The pace of growth and penetration in our view will take longer and depend on building a credible consumer-centric team. We believe CG Power is in a sweet spot, at the cusp of a Capex recovery under a dynamic leadership, but requires close focus on building technological competencies and sustaining its leadership stature over the longer term.