Expect 18000 only sustaining above 17100-16900;
Otherwise we may see 16000-15790
Market talk of FDI hike proposal in PSBS to 49% may help,
while continuing slippage in assets is a concern
Trading Levels:
| BNF-Nov | LTP | 17412 | ||||||
| SL=+/- | 25 POINTS | FROM SLR | ||||||
| T1 | T2 | T3 | T4 | T5 | SLR | |||
| Strong > | 17100 | 17200-350 | 17500-620 | 17735-790* | 17870-995 | 18040-110 | <17050 | |
| Weak < | 17050 | 16990-910 | 16840-750 | 16685-600* | 16500-345 | 16110-050 | >17100 |
Technically, BNF may be in the corrective 2-nd Wave in daily EW setup and the normal target for the same might be around 17150-16900. In that scenario, projected 3-rd Wave target might be around 18550-20800 !! (most extended rally).
Last week BNF spooked to some extent due to unexpected slippages in assets for Axis Bank and subsequent selling in other bank stocks (like ICICI/SBI/PNB etc). Recent trends in stressed assets may be an indication that there is still pain in balance sheets for Banks & NBFC(s) in absence of widely expected visible economic recovery till now.
As par reports, stressed assets for the Indian Banking system are at around 13% and still rising !!.
Some of the groups has amazing amount of debt in balance sheets and NPA with various banks.Although they are selling assets to reduce debt, at the same time, selling of core assets is also affecting their operational revenues/profits.
Hopefully, this may be the peak of stressed assets in our banking system.
Also there are concerns of competition from newly licensed payment & small banks.
As par reports, Govt may be considering hiking FDI limit in PSBS from present 20% to 49% for an immediate alternative of huge fund requirement for recapitalization & Basel-III norms.
Also various small PSBS may be merged for a bigger banking entity. Many small private banks might be M&A candidate as well in the days ahead.
Analytical Charts:
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