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1. YEAR -1 | Vol 1 | Issue 34 | Ludhiana | Price Rs.2/- Wednesday 22 April, 2020
DERIVATIVES DECODED
by Nitin Shahi
Till now we have discussed the
basics of options, terminology
o f c a l l a n d p u t . O t h e r
definitionslike In the money,
outofmoney,strikepriceetc.
We also discussed that value of
premiumofoptionis
Premium = intrinsic value +
timevalue.
We discussed intrinsic value of call and put.
Nowwehavetodiscussthetimevalue.
It is very easy to understand time value in
thishourofCovid19.Letussupposethatwe
are stuffed with 7 days of ration in our
homes, and Government of India
announces a 21 days lockdown. Do you
think that we need to panic about our
ration.TheanswerisYes.Onday1we
were not sure how efficiently the food
items, vegetables, medicines etc all our
dailyneedswouldbemet.
We did not know that how police will deal
with us, we all were in a state of curiosity.
We naturally will have a question in our
mind how we will manage 21 days
withrationof7daysathome.
In such a scenario we would rush
to the grocery shops/ vegetable
market Mandis and will buy what
everisneeded.Wewouldnotlook
at the premium being charged.
We will not ask for any discounts.
Werecentlyseenalotofpanicbuying.
Simplystated“Thisisknownastimevalue.”
Now think if government had announced
the lockdown is 42 days instead of 21 days.
Themarketswouldhavebeenmoreflooded
and things would have even sold at a
premium,thatparticularday.
Now in options time value has different
components
timetoexpiry
volatilitystrikeprice
rateofinterest.
Thus we need to discuss this in four parts.
And to understand it better we must try to
discuss each component in isolation. First of
allletusdiscusstimetoexpiry.
Let us continue the above example of
lockdown announcement by Government
of India. Day 1Janta curfew was imposed for
one day and that was Sunday, there was no
panic in the market, no one went to buy
ration for one day and there was no artificial
demandhencenopanicbuying.
Than government of India decided a
complete lockdown for 21 days. Our
demand of the commodities / requirement
was different, it send up, there was a lot of
stocking,therewasalotofbuyinghencethe
market prices increased with the elongation
ofthelockdown.
Same way, we find option premium will
increase with the time of expiry. We
understand the meaning of call option now,
which means buyer of the option has right
to buy a particular underlying asset at or
aboveaparticularprice.
Now for understanding purposes let us take
real life example of Nifty. Nifty future on
April 20.2020 closed at ₹ 9265 and the price
of 9000 call expiring 30 April 2020 is trading
at say 414 and call option of April 23.2020 is
trading at 306 this means intrinsic value of
premium is 9265-9000 is 265 in both the
cases.
Timevaluefor23April2020is41
Timevaluefor30April2020is149
Other factors in this case are constant and
equal,
Riskfreeinterestisconstant
Strikepriceissame
VIXissame
The only factor for varying market prices in
premiumofcalloptionof9000strikepriceis
the time to expire. It is due to the fact the
time to expire of the contract will give
higher probability of increase in price with
theincreaseinthevalueofNifty.
We can conclude higher the time to expire,
higher the amount of premium. Time to
expiryis
directly proportionate to premium of the
option.Thisistrueforboththeoptions,calls
andputs.
Brief Headlines:
Infosys Q4 | Profit falls 3.1% to Rs 4,321 cr, revenue rises 0.8% to Rs 23,267 cr, company
suspendsFY21guidance.
TCS|AmwaypartnerswithTCSforstrategicIToperationstransformation.
NLC India | Company raised Rs 1,000 cr via issuance of commercial papers to SBI for
standalonebusinessoperationrequirements.
InfibeamAvenues|CompanysignedabindingagreementforacquisitionofUS-basedITfirm
AIFintechInc.
Heidelbergcement India | Company resumed partial operations in some manufacturing
units.
Excel Industries | Company's manufacturing operations have restarted and will be ramped
upgradually.
SicagenIndia|BoardonApril23toconsidervoluntarydelistingofequitysharesfromNSE.
BlackRose|CompanyresumesoperationsatitsplantinJhagadia,Gujarat.
AspiraPathlab|RavindraDesairesignsasChiefExecutiveOfficer.
Udaipur Cement Works | Company's plant at Shripati Nagar, Udaipur is operational and
cementdispatchesresumed.
Usha Martin | Company resumes partial operations at manufacturing facility at Ranchi,
Jharkhand.
KEC International | Company resumes operations at few of its factories in India in a phased
manner.
Amara Raja Batteries | Operation at manufacturing facilities resumes partially on a limited
scale.
Everest Industries | Limited operations resume at plants in Somnathpur (Odisha),
Lakhmapur(Maharashtra)&Bhagwanpur(Uttarakhand).
Tata Elxsi Q4 | Profit rises to Rs 82.08 cr versus Rs 71.29 cr; revenue increases to Rs 438.88 cr
versusRs405.1crYoY.
HDFC|Corporationreduceditsretailprimelendingrateonhousingloansby15bps.
Seshasayee Paper | CARE re-affirmed credit rating on company's Long Term Bank facilities at
A+/Positive.
GSS Infotech Q4 | Profit rose to Rs 1.46 crore versus Rs 1.07 crore, revenue falls to Rs 32.84
croreversusRs37.62croreYoY.
MRO-TEK Realty | CRISIL reaffirmed its long term rating on company's bank loan facilities at
B+/Stable.
Kalpataru Power Transmission | Company’s project sites in the country have been partially
resumed.
TamilnaduPetroproducts|Operationsofpropyleneoxideplanthasrestarted.
Shalimar Paints | Porinju's Equity Intelligence India bought 1.84% stake, Assured Fin - Cap
PvtLtd1.28%incompanyduringMarchquarter.
GayatriProjects|Constructionactivityatcompany'sprojectsitesresumedoperation.
ITDCementation|Companypartiallyrecommencedoperationatsomeofitslocations.
Crompton Greaves Consumer Electricals | Company partially resumed operations at Goa
andVadodaraplantsinaphasedmanner.
Tejas Networks Q4 | Loss at Rs 126.53 crore versus profit at Rs 35.89 crore, revenue fell to Rs
54.57croreversusRs273.13croreYoY.
SBILifeInsurance|CompanytobeincludedinF&OfromMay4
BPCL|RestartedoverRs14,000croreofprojectsaslockdownrestrictionsease
Federal Bank | Bank to buy additional stake of up to 4% in IDBI Federal Life Insurance from
IDBIBank.
Indiabulls Housing Finance | The Delhi High Court has directed that no coercive action be
takenagainstthecompanyovernon-paymentofduestodebentureholdersuntilMay19.
No need to visit Jewelers
this Akshay Tritiya, Invest
through sovereign bonds
for more details contact +91-98032 52000
or visit us @ www.myfindoc.com
Gold is a hedge against inflation: if
rupee has to lose its value due to inflation
the gold will gain its price due to falling
rupee.
Currency risk: gold is aninternational
commodity and the prices are in dollar
terms. Any fall in price of the base currency
for us India rupee, the price of gold will
automatically rise. Geo political risk: Gold
prices are almost uniform pan world as the
prices are internationally denoted in dollar
terms.
Thus except the import duties which
different countries have the prices are
similar. We can say it is an international
currency. Best investment in state of Panic
as it covers above risks and also an
internationalcurrency.
USA in comparison to China has huge
reserves we expect China will have to
increase gold reserves sooner than later.
This will bring a spike in the Gold prices.
Many economist and surveys suggest that
itistheBestBuyinthistimes.
Asia expected to witness zero % growth in 2020 : IMF
Asia is expected to witness zero percent
growth in 2020 due to COVID-19 pandemic,
its worst growth performance in almost 60
years, the International Monetary Fund IMF)
hassaid.
The IMF in a blog titled 'COVID-19
Pandemic and the Asia-Pacific Region:
Lowest Growth Since the 1960s' further said
the impact of the coronavirus on the region
willbe"severeandunprecedented".
The blog said, "This is the worst growth
performance in almost 60 years, including
during the Global Financial Crisis, when the
growth stood at 4.7 percent; and the Asian
FinancialCrisiswhenitstoodat1.3percent."
It further noted that "Asia still looks to
fare better than other regions in terms of
activity".
A tough year for the developing economies in Asia
StockMarketLatestUpdates:Sensexzoomsover700points,Niftycloseto9,200-mark;Reliance,AsianPaintsamongtopgainers,Marketcapitalisationincreasesby2lakhcrore

2. Wednesday 22 April, 2020
Name CurrentPrice MarketCapitalization EPS Dividendyield IndustryPE PricetoEarning
VSTInds. 2948.1 4545.89 185.54 3.22 12.37 15.87
HeroMotocorp 1827.55 36494.27 191.72 4.76 16.69 10.85
SwarajEngines 955.75 1149.23 59.23 2.62 13.88 15.99
GodfreyPhillips 941.2 4895.15 75.86 2.55 12.37 12.41
PiramalEnterp. 829.7 18702.25 100.28 3.37 23.94 8.5
Shri.CityUnion. 728.2 4833.64 171.65 3.02 13.66 4.27
Mphasis 677.8 12647.44 58.93 3.98 14.28 11.52
VardhmanTextile 632.8 3628.57 108.2 2.77 6.08 5.94
CESC 607.45 8058.91 96.16 3.29 9.27 6.33
TechMahindra 512.95 49548.12 49.76 2.73 14.28 11.38
PersistentSys 473.9 3613.64 44 2.53 9.15 10.6
PolyplexCorpn 399.35 1263.18 112.86 5.01 4.98 3.5
SunTVNetwork 358.65 14128.19 36.35 6.97 15.06 9.87
BPCL 355.25 77083.63 39.74 5.35 7.13 9.86
TorrentPower 291.55 14017.11 30.66 3.98 9.27 9.52
DCMShriram 282.4 4495.12 52.67 3.47 18.3 5.48
HexawareTech. 265.05 7888.66 21.51 4.15 9.15 12.05
LICHousingFin. 262.3 13227.49 52.99 2.9 24.66 4.94
CochinShipyard 257.45 3380.91 45.34 5.05 6.5 5.67
Rites 253.55 6342.34 24.89 4.02 6.65 10.11
Sobha 234.85 2223.97 36.29 2.98 11.3 6.46
Cyient 223.65 2462.12 42.75 6.71 9.15 5.16
HPCL 215.85 32906.19 39.42 7.37 7.13 5.48
PetronetLNG 215.2 32331.75 18.52 2.56 13.98 11.4
Name CurrentPrice MarketCapitalization EPS Dividendyield IndustryPE PricetoEarning
T.V.TodayNetw. 205.1 1222.38 22.9 9.75 4.75 8.95
PNBHousing 204.1 3430.94 78.43 4.41 24.66 2.61
Mah.Seamless 188.6 1262.97 38.48 3.18 7.48 3.22
SonataSoftware 188.55 1981.53 26.99 10.74 9.15 7.08
ITC 179.6 220707.4 12.22 3.2 12.37 14.63
VRLLogistics 166.6 1503.78 12.01 4.2 7.97 13.86
PowerGridCorpn 162.65 85066.11 20.66 5.12 9.27 7.87
HeidelbergCem. 154.8 3512.27 11.6 2.58 13.78 13.37
M&MFin.Serv. 151.55 9365.05 24.84 2.64 13.66 6.13
ZeeEntertainmen 129.25 12409.84 16.5 2.71 15.06 7.16
Chambal Fert. 127.25 5276.35 26.92 3.14 6.81 4.09
JyothyLabs 112.85 4140.42 5.75 2.66 20.34 19.39
GHCL 108.1 1028.45 43.68 4.63 9.2 2.36
JKPaper 92.9 1655.89 27.42 4.31 8.32 3.35
RECLtd 91.45 18060.63 29.12 12.03 2.77 3.14
SterliteTech. 86.45 3492.26 12.89 4.05 3.23 6.3
Oil India 86 9320.74 19.82 11.92 8.79 3.14
GAIL(India) 82.5 37187.4 10.48 7.76 13.98 7.36
IIFLFinance 80.75 3051.48 20.26 6.19 13.66 5.4
NIIT 80.6 1356.57 81.14 9.93 7.14 3.6
Vedanta 78.45 29161.39 22.88 24.03 4.79 3.32
RedingtonIndia 72 2803.26 14.52 5.97 28.27 4.93
Guj PipavavPort 53.95 2605.8 6.11 6.49 8.82 8.82
BombayDyeing 53.05 1100.59 71.26 2.83 8.89 0.75
Jindal Saw 52.85 1689.9 32.63 3.78 4.91 2.3
Stock Report
Derivative Analysis
Stock Analysis - HindUniLiver
RBI asks banks to extend all benefits announced by
govt pertaining to short-term crop loans to farmers
T h e
Reserve
Bank of
India has
a s k e d
banks to
e x t e n d
t h e
b e n e f i t
o f
interest
subvention (IS) and prompt repayment
incentive (PRI) for short-term crop loans to
farmers till 31st May, 2020. In a notification, RBI
said, it has observed that many farmers are not
able to travel to bank branches for payment of
their short-term crop loan dues due to the
national lockdown imposed in view of the
coronavirusoutbreak.
It further noted that moratorium has
already been announced for all term loans
including short-term crop loans via COVID-19
Regulatory Package announced on 27th March
2020. Hence, RBI has directed banks not to
impose any penalty and continue to interest
subventionschemetilltheendofMay.
Disclaimer : The opinions expressed in the above report should not be
considered as buying/selling recommendation ,are a part of findings of a
material and is meant for educational purposes only. Fifteenth Finance Commission to
assess implications of COVID-19
pandemic on GDP growth
The Economic Advisory Council of the
Fifteenth Finance Commission will meet this
month to discuss implications of the
COVID-19 pandemic on GDP growth.
The council members will meet on
23rd and 24th of this month through
online medium which will be presided
over by Chairman of the Commission,
N. K. Singh.The members would also
be discussing on the possible
assumptions for tax buoyancy and
revenue in the current and next
financial year. Discussion on public
expenditure fillip to shore up the
economywouldalsobeontheagenda.
Disclaimer : The Opinions expressed are not any recommendations to
buy/sell and are findings of a material. Moreover we urge our subscribers
or readers to consult their investment advisor before investing

3. Wednesday 22 April, 2020
How people treat you is their karma, how you
react is yours: Wayne Dyer Leaders need to
take responsibility and be responsible of their
response to a situation. One must understand
that the situation is same for every one but the
response of every leader may be different.
Your response to that particular situation is
responsible for all your successes and failures.
The response should always be ethical and
always be good for society at large. The
response should be thought before and
discussed in details and understood hoe the
actiontakenwillimpactthelargeraudience.
The person who has an ethical reason and
takes the decision considering the larger
audience is a successful leader. There are
examples in history where two leaders had
exactly same situation, response of both the
leaders was exactly same but the logic behind
thedecisionwasdifferent.
One leader understood the condition, thought
ethically and gave response, the other leader
had selfish interest and responded as per his
ego and selfish interest. History recalls one a
goodleaderandtheotheroneabadleader.
I talk of example from Mahabharata, where in
Dhritarashtra ( who was blind ) is asking from
Sanjay what is happening in the battlefield in
Kurukshetra where Kauravas and Pandavas
were to fight. Kauravas were his own sons and
Pandavaswereson of hisrealDemisedbrother
Pandu. The only verse that Dhritarashtra
speaks In whole of a Gita is “SANJAY tell me
whatisgoingonbetweenmySonsandPandu’s
sons,astheygatherinKurukshetra?”
Dhritrashtra is father of Kauravas and refers
them as his own sons but he is also guardian of
Pandavas but he refers them as sons of Pandu
and not sons of his brother. When he says
these words he explicitly has excluded
Pandavasfromhisheart.Heconfirmsthatthey
are not part of his family, he is not their
guardianandtreatsthemasenemies.
On the other hand Arjun is confused and asks
Krishna the charioteer to take the chariot in
between the battlefield which is no man’s land
and asks Krishna that both the sides have his
relatives, friends nears and dears. Killing our
nears and dears, how can that be right. He asks
“Krishna, Kauravas are family to me, how can
weslaughterthem.Whywouldcommunities
respect boundaries, why would women
botherfidelity?”
Arjuna asking this question confirms that he is
confused, he wants to discuss his actions
would lead to mass killing and how it is ethical
to slaughter his own family, teachers, nears
and dears. Ultimately both the ends fought,
Kauravas are said to have fought for their
selfish interest and Pandavas fought for self
respect,ethics, motives. Eventually Pandavas
won and are respected as great warriors. We
will find a lot of persons till date with the name
Arjun and not a single person known as
Dhritarashtra or Duryodhan. Thus response to
particular situation will decide the fate
whetheryouareagoodleaderorabadleader
by Nitin Shahi
The wisdom tooth
Central Board of Direct taxes, CBDT has
issued over 10 lakh refunds worth four
thousand 250 crore rupees in a week. These
refundsareoverandabovethetwocrore50
lakh refunds already issued in 2019 -20 till
31st of last month totaling to one lakh 84
thousand crore rupees. Last week, CBDT
hadsaidthatitwillissuependingincometax
refunds up to five lakh rupees to help
taxpayers in a COVID-19 pandemic
situations. CBDT further said that about
1.75 lakh more refunds are in the process of
issuance
in this week.
These refunds would
get credited directly
to the taxpayer bank
account in 5 to 7
business days from
issuance.
H o w e v e r, i n
around 1.74 lakh
c a s e s , e m a i l
r e s p o n s e s a r e
a w a i t e d f r o m
taxpayers regarding
reconciliation with
their outstanding tax
demand for which a
reminder email has
been
sent. CBDT said, these reminder emails
from I-T department are in fact for the
benefit of taxpayers as it seeks them to
confirm their outstanding demand, their
bank accounts and reconciliation of defect
ormismatchpriortoissueofrefund.
CBDT has appealed that it is in the
interest of taxpayers to provide a response
to such emails at the earliest so that refunds
could be processed and issued at the
earliest.
CBDT issues over 10 lakh refunds worth Rs 4250 cr
in week : a welcome step and relief for the tax payers
Scheme Name AuM(Cr) 1Y 2Y 3Y 5Y 10Y
SBI Magnum Gilt Fund - GrowthGilt Fund 2,250.84 17% 12% 9% 9% 10%
ICICI Prudential Gilt Fund - GrowthGilt Fund 1,405.06 14% 10% 9% 9% 9%
Nippon India Gilt Securities Fund- GrowthGilt Fund 1,203.59 16% 13% 9% 10% 9%
HDFC Gilt Fund - GrowthGilt Fund 1,003.75 10% 8% 7% 8% 8%
IDFC Government Securities Fund - Investment Plan - Regular Plan - GrowthGilt Fund 518.12 17% 13% 9% 9% 10%
UTI Gilt Fund - GrowthGilt Fund 496.12 15% 11% 8% 9% 9%
Gilt Funds
Facebook buys 9.99% stake in Reliance Jio for Rs 43,574 cr, largest
FDI in India's tech sector - outlook positive for reliance
Social media major Facebook will invest
Rs 43,574 crore into Jio Platforms, a unit of
Reliance Industries, for a 9.99% stake. The
investment will value Jio Platforms - a digital
appsplatform-atRs4.62lakhcrore.
"Reliance Industries Limited (“Reliance
Industries”), Jio Platforms Limited (“Jio
Platforms”) and Facebook, Inc. (“Facebook”)
today announced the signing of binding
agreements for an investment of Rs 43,574
crore by Facebook into Jio Platforms,"
Mukesh Ambani-led RIL said in a statement
onWednesday.
"This investment by Facebook values Jio
Platforms at Rs 4.62 lakh crore pre-money
enterprise value ($65.95 billion, assuming a
conversion rate of Rs 70 to a US Dollar).
Facebook’s investment will
translate into a 9.99% equity
stake in Jio Platforms on a
fully diluted basis," the oil to
telecom business house
added.
Reliance Jio --- RIL's
telecom unit with 388 million
subscribers - will continue to
remain a wholly owned
subsidiary of Reliance
Platform.
RIL said that this was the
largest investment for a
m i n o r i t y s t a k e b y a
t e c h n o l o g y c o m p a n y
anywhere in the world and the largest FDI in
thetechnologysectorinIndia.
"At the core of our partnership is the
commitment that Mark Zuckerberg, founder
of Facebook, and I share for the all-round
digital transformation of India and for
serving all Indians…In the post-Corona era, I
am confident of India’s economic recovery
and resurgence in the shortest period of
time. The partnership will surely make an
i m p o r t a n t c o n t r i b u t i o n t o t h i s
transformation," said Mukesh Ambani,
chairmanandMDofRIL inthestatement.
In a separate statement, Facebook said
the deal underscores its commitment to
India. India is the biggest market for
Facebook with 328 million monthly users
and the company’s WhatsApp messaging
app has 400 million users in the country, also
themostintheworld.
“…Our efforts with Jio will be focused on
opening new doors and fueling India’s
economic growth and the prosperity of its
people. We look forward to working with Jio,
and to future collaborations in India to
advance this vision,” Facebook said in its
statement.
“…In less than four years, Jio has brought
more than 388 million people online, fueling
the creation of innovative new enterprises
and connecting people in new ways. We are
committed to connecting more people in
IndiatogetherwithJio,”Facebookaded.
The main focus of the deal is to come up
with digital based solutions for 60 million
micro, small and medium businesses, 120
million farmers, 30 million small merchants
and millions of small and medium
enterprisesintheinformalsector.
Concurrent with the investment, Jio
Platforms, Reliance Retail and WhatsApp
have also entered into a commercial
partnership agreement to further accelerate
RelianceRetail’s New Commerce business on
the JioMart platform using WhatsApp and to
supportsmallbusinessesonWhatsApp.
"In the very near future, JioMart – Jio’s
digital new commerce platform, and
Whatsapp – will empower nearly 3 crore
small Indian Kirana shopsto digitally transact
witheverycustomerintheirneighbourhood.
This means all of you can order and get faster
delivery of day-to-day items, from nearby
localshops,"Ambanisaid.
He added that at the same time, small
kiranas can grow their businesses and create
new employment opportunities using digital
technologies.
“Our goal is to enable new opportunities
for businesses of all sizes, but especially for
the more than 60 million small businesses
across India. They account for the majority of
jobs in the country, and form the heart and
soul of rural and urban communities alike. In
the face of the coronavirus, it is important
that we both combat this global pandemic
now, and lay the groundwork to help people
and businesses in the years to come,”
Facebook said. It added that the focus of the
tie up will be to create new ways for people
and businesses to operate more effectively
in the growing digital economy. “For
instance, by bringing together JioMart, Jio’s
small business initiative, with the power of
WhatsApp, we can enable people to connect
with businesses, shop and ultimately
purchase products in a seamless mobile
experience.”
Morgan Stanley as financial advisor and
AZB & Partners and Davis Polk & Wardwell as
counselsadvisedonthe
transaction.
Amidst corona problem April crude futures settled at
-2884 per barrel. Outlook remains negatively biased
Of all the wild, unprecedented swings in financial
markets since the Covid-19 pandemic broke out, none
has been more jaw-dropping than Monday’s collapse
inakeysegmentofU.S.oiltrading.
The price on the futures contract for West Texas
crude that is due to expire Tuesday fell into negative
territory -- minus $37.63 a barrel. That’s right, sellers
were actually paying buyers to take the stuff off their
hands. The reason: with the pandemic bringing the
economy to a standstill, there is so much unused oil
sloshing around that American energy companies
have run out of room to store it. And if there’s no place
to put the oil, no one wants a crude contract that is
abouttocomedue.
Underscoring just howacute the concern over the
lack of storage is, the price on the futures contract due
a month later settled at $20.43 per barrel. That gap
betweenthetwocontractsisbyfarthebiggestever.
“TheMaycrudeoilcontractisgoingoutnotwitha
whimper,butaprimalscream, ” said Daniel Yergin, a
Pulitzer Prize-winning oil historian and vice chairman
ofIHSMarkitLtd.
“Thereislittletopreventthephysicalmarketfrom
the further acute downside path over the near term,”
said Michael Tran, managing director of global energy
strategy at RBC Capital Markets. “Refiners are
rejecting barrels at a historic pace and with U.S.
storage levels sprinting to the brim, market forces will
inflict further pain until either we hit rock bottom, or
COVID clears, whichever comes first, but it looks like
theformer.”
Since the start of the year, oil prices have plunged
after the compounding impacts of Covid-19 and a
breakdown in the original OPEC+ agreement. With no
end in sight, and producers around the world
continuing to pump, that’s causing a fire-sale among
traderswhodon’thaveaccesstostorage.
The extreme move showed just how oversupplied
the U.S. oil market has become with industrial and
economic activity grinding to a halt as governments
around the globe extend shutdowns due to the swift
spread of the novel coronavirus. An unprecedented
output deal by OPEC and allied members a week ago
to curb supply is proving too little too late in the face a
one-thirdcollapseinglobaldemand.
There are signs of weakness everywhere. Even
beforeMonday’splunge,buyersinTexaswereoffering
as little as $2 a barrel last week for some oil streams. In
Asia, bankers are increasingly reluctant to give
commodity traders the credit to survive as lenders
grow ever more fearful about the risk of a catastrophic
default.
In New York, West Texas Intermediate for May
delivery dropped as low as negative $40.32 a barrel.
It’s far below the lowest level previous seen in
continuation monthly data charts since 1946, just
after World War II, according to data from the Federal
Reserve Bank of St. Louis. Brent declined 8.9% to
$25.57abarrel.
Crude stockpiles at Cushing -- America’s key
storage hub and delivery point of the West Texas
Intermediate contract – have jumped 48% to almost
55 million barrels since the end of February. The hub
hadworkingstoragecapacityof76million
as of Sept. 30, according to the Energy
InformationAdministration.

4. Wednesday 22 April, 2020
Gulf Oil Lubricants India Ltd. is into
the business of lubricants and oils.
Gulf Oil International holds 72.29%
stake in Gulf Oil’s total share capital,
owning the distinguished Gulf brand
globally (except theUS, Spain and
Portugal) & is present in 100+
countries worldwide. The Hinduja
group acquired Gulf Oil International
Ltd, in 1984, & thus entered the oil
& gas space.
The leading player of the lubricants
& oils industry is Castrol i.e. the
top competitor.
(A) Business Segments
(i) Automotive Segment
Gulf Oil Lubricants distributes via
two primary channels:
1) Bazaar, which includes spare
parts stores, exclusive lubricant
stores and independent
workshops/garages
2) Secondly, OEM Franchise
Workshops.
•Personal Mobility (MCOs and
PCMOs): The segment caters to
bikes and cars. PCMO contribution
to volume mix is ~24%.
•Commercial vehicle oils/DEO: As
per company, Gulf holds 8-9%
market share in this segment. DEO
contribution to the mix is ~34%.
•Non-engine oil: include greases,
coolants, brake fluid & other
products.
(ii) Industrial Segment
As per company, Gulf holds 3-4%
market share in Industrial lubricants
segment. Contribution to volumes
mix is around 23%.
(iii) Infrastructure Segment
This segment caters to the unique
requirements of clients across the
sectors of infrastructure, mining &
fleets.
(iv) Exports Segment
The key countries that the Company
caters to include Nepal, Bangladesh,
Indonesia, Qatar, Africa, among
others. Volume share of the
segment is 3-4%.
(v) Batteries
Gulf entered two wheeler batteries
business in 2013. Most recently, Gulf
Oil is planning to set up a greenfield
plant (capex of Rs 800mn) to
manufacture batteries locally.
(B) Hinduja Group
Mr. Parmanand Deepchandh
Hinduja is the founder of Hinduja
Group. The group was set up in 1920
& now is a conglomerate with
companies including Ashok Leyland,
Hinduja Foundries Ltd, Hinduja Bank
(Switzerland) Ltd, IndusInd Bank,
Hinduja Housing Finance, Hinduja
Leyland Finance Ltd, Hinduja Global
Solutions Ltd, Gulf Oil International
Ltd, Gulf Oil Lubricants India Limited,
Hinduja National Power Corporation
Ltd, IndusInd Media and
Communications Ltd. among others.
Srichand P. Hinduja, the eldest son
of founder P. D. Hinduja is now the
chairman of Hinduja Group.
(C) Family Structure
(D) Executive Management of Gulf
Oil Lubricants
(i) Mr. Sanjay G. Hinduja –
Chairman
He is the son of Mr. Gopichand P
Hinduja (Co-chairman – Hinduja
Group, Chairman – Hinduja
Automotive Limited, UK) and Ms.
Sunita Hinduja. Mr. Sanjay G.
Hinduja holds a Bachelor’s Degree in
Business Administration from
Richmond College, London. Before
joining the family business, Mr.
Sanjay worked with Credit Suisse,
First Boston and Chase Manhattan
Bank. His current age is 56 years. He
does not hold shareholding in Gulf
Oil Lubricants. His remuneration for
FY19 includes Fees for attending
Board Committee meetings Rs.
9,25,000 & Commission Rs.
87,50,000, 0.06% of the company
revenue.
(ii) Mr. Ravi Chawla – Managing
Director
He has been Managing Director of
Gulf Oil Lubricants from June 2014.
He has over 28 years of
professional experience in sales,
marketing & management across
diverse sectors in Indian
companies and MNCs with
organisations like Wipro Consumer
Products Ltd., CEAT Ltd, Polaroid,
Pennzoil-Quaker State India Ltd.
(was part of Royal Dutch Shell
Group of Companies) & Mahindra
and Mahindra (Farm Equipment
Division) before joining Gulf Oil
Corporation Ltd in 2007. His age is
53 years. His remuneration for FY19
is Rs. 4.75 crore, 0.28% of company
revenue.
Disclaimer: The report only
represents personal opinions and
views of the author. No part of the
report should be considered as
recommendation for buying/selling
any stock.
By CA Paras Behl
Head Equities - PA Wealth Advisors
blog.pawealthadvisors.com
Gulf Oil Lubricants: Management Group
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Weekly Performance 14/04/2020 -20/04/2020
INDEX
GLOBAL INDICES
CURRENCY
MF SEBI
Date Equity Debt
13-Apr-20 -789.54 -1,065.17
09-Apr-20 -1,177.25 1,290.01
08-Apr-20 -2,292.60 -1,628.93
Value in Crores
FII SEBI
Date Equity Debt
20-Apr-20 93.02 1,541.85
17-Apr-20 -967.03 -435.68
16-Apr-20 -2,590.75 -1,249.56
15-Apr-20 909.32 337.42
Value in Crores