Edelweiss India Post Conference Notes - Day-2 - Mumbai - Corporate Powerhouse

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We present key takeaways from day 2 of "Edelweiss India Conference-2012". The two day event was a resounding success and enabled over 2,000 one-on-one insightful meetings between investors and corporates.

Apart from investor-corporate interactions, highlights of the conference were the unique and insightful panel discussions on myriad topics such as financial inclusion, infrastructure and sustainability of consumer growth. The panel for each of the sessions was represented by leading names from the respective industry groups.

 The discussion on financial inclusion touched upon issues like creating a viable business model for enabling financial inclusion via a differentiated product and service offering and the use of modern technology and innovative distribution channel as enablers. The infrastructure panel dwelt on the hotly debated issues including availability of coal, rationalization of tariffs and risk allocation in major projects. Among other interesting topics, the potential for urban infrastructure, waste management and renewable energy as the next big thrust areas within the infra sector were discussed, especially in the context of India emerging as the largest PPP market in the world. Meanwhile the discussion on the consumer trends focused on the immense potential of India's retail markets. Interestingly, all panelists laid stress on growing importance of rural India as a market. This apart, the CIO panel debated on the increasing impact of government's decision making on the markets. The participants were of the view that while liquidity might push up the markets in the short term, for a sustainable rally, some new triggers are required, especially from execution front from the government.

Apart from panel discussions, the conference was also graced by eminent CEOs who addressed interesting and emerging trends - both for respective companies as well as for industries.

Through corporate interactions, investors continued to gain valuable insights. Within the capital goods sector, the key observation was the lingering weakness in power generation market owing to structural issues in coal and land availability. Participants however, were optimistic about the robust ordering from emerging areas such as urban infrastructure. On the BFSI sector, discussions centered on the asset quality issue (particularly infra segment), outlook on margins and drivers of credit growth going ahead.  In the oil & gas sector, our interactions suggest that the provisional under-recovery sharing for upstream, as hinted by GoI, is pegged at 37.91% for FY12. This is positive for upstream companies as the consensus was at ~45%. While outcome will be known in next three months, initial indications are positive. For the cement sector, our interactions pointed to 8% YoY demand growth in FY13 with the South region witnessing a near double digit growth due to a low base. The current surplus capacity, on a pan-India basis, is likely to subside over the next 2-3 years, aiding a gradual improvement in cement prices.

In sum while there are areas of concern, there is still a strong appetite for new ideas and investor mood seemed to be tilted towards optimism for FY13.       
       
       
       

Edelweiss India Post Conference Notes - Day-2 - Mumbai - Corporate Powerhouse