OMKARA CAPITAL – DAILY NEWSLETTER (23rd June, 2026)

Themes create excitement. Earnings create wealth. Valuations determine returns. Never forget the difference: VB

"Airlines was theme in 90s, Telecom was a theme of 2000s but none of the Airline survived and in Telecom only one player exists from that era. Only identifying themes won't make you money. You have to look at management, execution capability, balance sheet quality. Go where real pricing power is present rather than Dog eat Dog market: Rajeev Thakkar."

Headlines
•⁠ ⁠America issues a 60-day general license allowing countries - including India - to buy Iranian oil and petrochemicals. Iran capacity is 3.5 million barrels a day.
•⁠ ⁠SpaceX share price is down to USD 155 (from recent highs of USD 225) and below listing price

Stocks To Watch
•⁠ ⁠Happy Forging delivery data: 20 lakh shares marked for delivery in just last 2 days – this is highest ever seen since listing of the co
•⁠ ⁠Craftsman Automation: block deal today (good to see institutional investors lining up now)
•⁠ ⁠IIFL Finance: Board meeting on June 27 to consider fund raising (finally growth story will be seen by big names)
•⁠ ⁠Bandhan Bank: board meeting on June 25 to consider “capital plan of the bank”
•⁠ ⁠RBL Bank - three-notch jump in credit rating: Crisil upgrade credit rating from to AAA (from not rated earlier by Crisil and AA- rating by ICRA). This is the very important structural catalyst for the bank, as it can drive 50-100bps funding cost improvement in the medium-term and open new wholesale business opportunities.
•⁠ ⁠Q-line Biotech (SME): FY27 guidance (management): Revenue growth target ~30-35% YoY. On the Rs. 342 cr base = Rs. 445-460 cr. Pipeline moving: Electrolyte Analyzer commercialised; Microlab 300 launch Q2 FY27; 7 devices in pipeline incl KC1 Delta coagulation (Stago) and Q-Count 5 haematology. FY28e PAT nudged up to ~Rs. 107 cr (from Rs. 100 cr); EBITDA margin assumption lifted to 28%. Stock ~17x FY27e, ~13x FY28e at CMP of Rs. 580 (An idea discussed in FORUM in the Omkara data room)

SOCIAL MEDIA INLFUENCERS HAVE TURNED FROM WAR/ AI EXPERTS TO INDIAN STOCK EXPERTS

Earlier, the social media was abuzz with only war/ AI news. And now I see the entire social media is abuzz with Indian stocks. It is certainly good to see this. Everyone is excited about some new opportunities in either large/ mid/ small or SMEs. Hunt is going for bigger delta in the markets. We continue to stick with our “circle of competence” and focus on “margin of safety. As I said earlier – sometimes – the winners of the next 3–5 years are often already sitting in our portfolios today. The challenge is not finding the next 100 ideas; it is having the conviction to hold the right 10–15 ideas through periods of volatility, anxiety & excitement as well.

I love the theory - mean reversion. It is so true in the stock markets. Everyone I met in the last 2 years only wanted AI/ aerospace/ defence/ semi-conductor – nothing wrong with it & it is certainly a big theme, but valuations? margin of safety? cash flows?

We are playing ADS opportunity via Sansera/ Bharat Forge. And love these companies. Also another co we love is Happy Forging which is expanding into power generation, aerospace, defence and heavy engineering applications. We understand that the co is engaged with Cummins for data center-driven power projects. AI/Data Centers → Higher electricity demand → More backup generators & power infrastructure → Higher demand for engine and power-generation components → More opportunities for Happy Forgings. So, I am not going to mediocre my portfolio buy selling Happy Forgings or Sansera or Bharat Forge to buy some new SMEs names for sure. I may dabble small if I have extra money.

Also, a word on NBFCs. While the world is obsessed with ADS – but still financials cannot be and should not be ignored at all. Also, NBFC setup has improved as W. Asia tensions ease. Growth and collections are tracking well ahead of last year. Softer bond yields & delayed rate-hike expectations should support NIMs.

Aditya Birla Capital market-cap crossed Rs 1 lakh crore & it was untouchable almost 2 years back. Can command 3x PB as well.

A simple rule for NBFcs: 15% ROE + 20% growth → deserves ~2x P/B.

IIFL Finance with over Rs 1 lakh crore book & will do 16% + ROE in FY27e and loan growth above 20% easily is still trading at 1.1x PB FY28e BV.

Fed Financial with nearly Rs 20k crore book & will do 15% + ROE in FY27e and loan growth 20-25% easily is still trading at 1.2x PB FY28e BV.

Norther ARC still trade below 1x BV. And even MFIs and SFBs like Indostar cap, Jana SFB, Fusion – all below 1x PB.

We are playing NBFCs theme via a basket approach and believe that FY27 will be a year of big earnings upgrade and valuation re-rating will happen certainly.

Invest what you understand and not in any hype/ narratives/ euphoria. Make money slow – but aim to make for long term consistently.

Warm regards,
Omkara Capital Private Limited, India
www.omkaracapital.in

Disclaimer: This newsletter is for informational purposes only and does not constitute investment advice. Please consult your financial advisor before making any investment decisions.