Assertion Supported
Tannenbaum: Indian private markets returned 35 cents per dollar since 2000
“Of every dollar invested since 2000, something like 35 cents has come back, and I'm sure the industry will come good, but as I was sort of looking over the proverbial wall at other asset classes, it's not exactly apples to apples comparison, but for example, i…”
Assertion Supported
Tannenbaum: Net Foreign Allocator Flows to India Are Functionally Zero
“Net flows from foreign allocators are functionally zero to India.”
Assertion Partly supported
Tannenbaum: 80% of new power generating capacity in India is renewable
“In reality, 80% of new generating capacity in India is renewable.”
Insight
Tannenbaum: Conglomerates are suboptimal everywhere in the world except in India
“So much so that there's a Harvard Business School professor I worked with named Tarun Khanna, who'd done this seminal research where he said, conglomerates are the worst form of business unit and organization and suboptimal everywhere in the world, except Indi…”
Assertion Supported
Tannenbaum: India's stock index matched 8x GDP growth since 1999, beating China
“China's GDP growth has been 16 X versus eight X for India, but China's index performance on that 16 X GDP growth has been two and a half X, and India's index performance on that eight X GDP growth has also been eight X.”
Assertion Supported
Tannenbaum: 75% to 80% of Indian Large-Cap Returns Are EPS-Driven
“The other is that valuations must be expensive, and because India has had a relatively decent run, that too feels like it should be the case, but when you decompose it, yes, returns have been okay, but because earnings growth has been pretty strong for the lar…”
Assertion Supported
Tannenbaum: India's share of world economy fell from one-third to 3%
“What had once upon a time been pushing a third of global economic activity after the depredations of conquest and colonialism and a flirtation with socialism was three percent of the global economy.”
Assertion Not checkable as stated
Tannenbaum: Indian Markets Suffer High Manager Attrition and Weak Duration
“In the Indian context, that's a curious thing that market performance has been pretty strong, but manager attrition is really high and duration is not so hot.”
Assertion Not checkable as stated
Tannenbaum: India Is Among the Most Fragmented and Liquid Emerging Markets
“It's among the most fragmented markets in the world in terms of all the different themes and industries that are represented, and it is among the most liquid for an emerging market.”
Assertion Supported
Tannenbaum: Two-Thirds of Indian Public Companies Lack Analyst Coverage
“Two thirds or three quarters of companies have one or zero sell side analysts covering them.”
Assertion Supported
Tannenbaum: 5% of Indian public companies are state-owned versus China's 30%
“About five percent of the companies are majority government owned. I think in China, it's 30 or 40 or more percent.”
Insight
Tannenbaum: Top Indian index constituents often lag smaller peers in ROE
“In many cases, it's not the largest, the highest profile, the indexed constituent Representative of a particular theme that's actually gonna do best from a shareholder or return on equity standpoint, and it's that appetite to roll up our sleeves and try and un…”
Assertion Supported
Tannenbaum: Top 3-6 Indian lenders capture outsized revenue and earnings
“You'll tend to see historically very fragmented industries in India where there are 300 publicly traded bank and non-bank lenders that are beginning to give way To concentration where the top three or five or six are accounting for an outside share of top line…”
Insight
Tannenbaum: Cement, power, and real estate are high-growth sectors in India
“There are growth businesses like cement, like power, like real estate, that from a US context, we say, oh, they're pretty mature sectors. In India, they're not mature at all.”
Assertion Supported
Tannenbaum: Highest ROE Indian power company trades at 8x earnings
“One of the fastest growing in By some distance, the highest return on equity participant in the power sector is trading at eight times earnings.”
Assertion Not checkable as stated
Tannenbaum: Indian corporate disclosure is strong but data aggregation is poor
“In India where data disclosure is really good, but data aggregation isn't so good, that's allowed us to do some pretty classic filters for earnings, consistency, quality, things of that nature.”
Insight
Tannenbaum: Fundamental research creates bigger, longer-lasting edge in India than US
“Whereas when I think about my US experience, and it doesn't matter how small the company, how novel the research approach, there are a lot of other people poring over the same idea in The differentiated edge is going to be small and short-lived. In India, some…”
Assertion Supported
Tannenbaum: Major Indian corporate blowups were large caps with unanimous buy ratings
“Just in the time I've been investing, there have been permanent losses of capital in one of the largest banks, in more than one of the leading telecom companies, in the largest brick and mortar retail company, one of the big software companies, and these were …”
Insight
Tannenbaum: Indian corporate collapses almost always show public red flags beforehand
“Very seldom have these things gone bust, and afterwards people said there's absolutely nothing that would have suggested this. Usually there's something in how they've allocated capital, How they've done business with associated companies, margins they earn th…”
Assertion Not checkable as stated
Tannenbaum: Strict regulation has limited asset quality collapses in Indian banking
“In the Indian banking sector, which is small and fast growing, there have been relatively few asset quality collapses in part because the regulator has been fairly strict in what they allow banks to pursue and what they don't.”
Insight
Tannenbaum: Tactical trading in Indian equities has a very limited success rate
“I think in the Indian context, what we found is anything that starts to approach tactical trading in and out of a position for any reason has a pretty limited success rate”
Assertion Partly supported
Tannenbaum: Domestic Capital and 75M Mutual Fund Accounts Fuel Indian Market
“What's been fueling the market is domestic investment, which over that same period is something like fifty-five billion dollars, and there are seventy-five million new mutual fund investors, which even in the Indian context is a big number, and pension exposur…”
Assertion Supported
Tannenbaum: Indian Small-Caps Trade at 3 to 5 Turn Premium Over Large-Caps
“Very small companies are actually unusually expensive right now, where there are small cap indexes trading at a three or four or five turn premium to the larger cap index.”
Assertion Supported
Tannenbaum: Top Six Indian Private Banks Combined Are 1/7th Size of ICBC
“India's largest bank is smaller than China's 11th largest bank. Its largest six private sector banks put together are one seventh the size of ICBC.”
