Lot of moving parts again. When geopolitics and tariff got settled, suddenly bond yields are spiking again and there is a new tax template which be passed by the US administration soon. Do you think this is something which we need to analyse I mean, sitting in India?
Sandip Sabharwal: Bond yields do not matter so much in my view because of the fact that we are not in a crisis situation.
Basically it is a sort of follow through of the misdeeds of fiscal imprudence in those countries which will lead to higher longer-term bond yields and slower growth over the long term. So, until and unless we are bothered about a possible default, we should not be bothered so much and there is a clear divergence between bond yields of various countries, like you look at bond yields in China, they are at multi-year lows.
You look at bond yields in India, they are at multi-year lows. So, there are divergent trends all over. European bond yields have also got unhinged from US bond yields. So, until and unless we reach a situation where there could be a crisis of which is sort of default related, then those issues could be there.
On the US tax changes and all, the only thing which should bother Indians is the remittance tax which has been proposed, which could hurt the flow of remittances to some extent and increase the cost for the Indian diaspora staying in US, so that is something which will be a small concern, ex of that nothing to do with India.
Let us analyse some of the earnings then. Sun Pharma, you tracked this one. What did you make of the numbers because while the India faction seems good, weak US and more importantly cautious guidance now amidst all the global uncertainty at play what the management has cited.
Sandip Sabharwal: Yes, so the reported results operationally were good because they had some extraordinary write-offs, etc. But the guidance obviously which they have given for this year is muted. So, topline growth is fine, but they are indicating some sort of increase in expenses in the short term which would potentially impact margins.
So, to that extent earnings growth which at least for this year becomes subdued and potentially for next year improves as many of these things play out. So, my guess is that we could be in for subdued return period for Sun Pharma for some time now.
You remember TTML, the landline service provider.
Sandip Sabharwal: Yes, I have a landline phone by TTML.
Still. What is happening in this stock?
Sandip Sabharwal: Yes, happy user does not mean that the share has any value. I think share should be valued at zero only.
It does not have operating business, I mean frankly, does not have a big operating business.
Sandip Sabharwal: Yes, so I think this Vodafone and this Tata Tele Services, now they have no value actually. So, these are just punting stocks. There is no reason why it goes up. There is no reason why it goes down.
