InvestorQ : Please suggest about South Indian Bank and Maghmani organic
Kamruz Zaman made post

Please suggest about South Indian Bank and Maghmani organic

2 years ago
Let me talk about South Indian Bank (based out of Kerala) first. The company had come under pressure in the 3rd quarter of last fiscal due to the floods in Kerala and had resulted in higher provisions which had dragged South Indian Banks (SIB) 3QFY19 PAT to INR838m (27% YoY decline) even as operating profit growth stood flat. During that period, fresh slippages increased to INR6.59b led by the downgrade of IL&FS (where it had an exposure of Rs.400 crore). Advances growth of the bank has been quite attractive but the pressure of weak performance of the SME sector is showing. It is best to stay away from the stock.

Let us now move to Meghmani Organics. The stock has almost halved in the last one year and is quoting at around 8X P/E ratio. The company has been one of the big beneficiaries of the focus on specialty chemicals after China reduced its capacity to adhere to environmental concerns. However, of late the stock has taken a beating after some of the key user industries across Europe and Latin America have seen a slowdown in growth. The immediate future is not too good for the stock.