Given the kind of consolidation we have seen, did the up move yesterday had a lot to do with the kind of AMFI data we have seen?
Chakri Lokapriya: There are two or three different reasons. One is, of course, we were waiting so long for a finality on Trump tariff and now it is clear that the number is 50%. So that is one. Some amount of uncertainty has gone away. The second is now there is an expectation that the US-Russia trade talks would rather help in stopping the war and therefore help India purchase oil. Now, if that does not come about or if that event is not connected or becomes disconnected from India’s tariff by the US, then clearly there is some weakness.
So, the market is assuming that if the US and Russia come to an agreement, the extra 25% goes away but that may not always be correct. We do not know the answer. These are the two reasons, one is a relief but clearly if the 50% tariff stays, then the hit on GDP is close to 35 bps to 1 percentage point.
Though it is the earnings season, how have you read into SBI or for that matter even Manappuram’s earnings because the MFI segment seems to be under pressure across the board? What have you picked up from SBI’s commentary?
Chakri Lokapriya: SBI numbers were good and both their loan and deposit growths are good compared to the rest of the banking industry. SBI recently concluded its QIP and is extremely well capitalised. In view of the Trump tariffs, the focus of the Indian government would be more on the infrastructure and therefore as lenders SBI and other PSU banks would be primary beneficiaries. It is at a very favourable valuation, and clearly would buy an SBI.