OMKARA CAPITAL – DAILY NEWSLETTER (28th July 2026)

Chris Wood warns of massive capital destruction in US as China challenges AI boom: The time for an extended AI hangover after the initial surge of enthusiasm is approaching, if it has not already arrived

There are two big developments overnight. One, of course, is good news: there are talks that the USA and Iran may have direct talks. The crude is falling sharply now, well below $90, which means it has fallen nearly 15% from its last week's highs.

The second is the sharp fall happening in all these AI-related stocks. The Korean index went down by 8%, hitting the lower limit, and all hyped stocks like Hynix, Samsung, LG Innotek and many are down anywhere between 8% and 10% overnight. And now Hynix which was listed in the USA a few days back with big euphoria & fanfare, is now below the IPO price. Just imagine: Sandisk stock is now down -47% from its June 22nd record high. Fashions works only on the ramp, and not in the stock markets.

I've said this again and again: Korean markets, or any stock markets where two or three stocks make 60%, 70%, or 80% of the market cap, are trading bets and not investment bets. On the other side, India remains a very deep, wide, liquid, structural bet for smart investors.

And in India: SBI economist says FCNR(B) deposits have already crossed 2013 level in 45 days. And he expects total FCNR(B) deposits of $65-70 bn, and including OFCB and ECB at $80-$85 bn under the swap window. This is massive.

FIIs have to come to India after burring their hands in trading markets. I cannot even fathom investing in a stock market which is so volatile & falls 30-40% in few months due to valuations & narratives. Nifty is still holding at 24k despite FIIs sell-off, Trump threats, war stress and so many other issues. One need to work hard to find winners and there are many in the Indian markets.

GOOD EARNINGS
Motilal Oswal on Northern ARC: NACL trades at 1.1x FY27E P/BV. We model an AUM/ PAT CAGR of ~21%/34% over FY26-28E, with RoA/RoE of ~3.2%/15% in FY28E. Reiterate our BUY rating with a TP of INR395, based on 1.2x FY28E P/BV

1. Northern ARC Q1FY27 review —delivers highest ever PAT in Q1FY27 which is seasonally a lean quarter. MFI book picks up after 4-5 quarters of deliberate scale down as MSME and Consumer Finance also grows double digit YoY. D2C now contributes to 64% of the total book, aims to take this to ~70% by FY28. Net Interest Income at Rs 494cr vs Rs 441cr QoQ vs Rs 342cr YoY (12.05% QoQ and 44.67% YoY). Operating Profit (PPOP) at Rs 263cr vs Rs 269cr QoQ vs Rs 207cr YoY (-2.26% QoQ and 27.09% YoY). Profit After Tax (PAT) at Rs 114cr vs Rs 133cr QoQ vs Rs 78cr YoY (-13.98% QoQ and 45.82% YoY). NIM (calculated on Avg Interest Earnings Assets (IEA)) at 12.40% vs 11.70% QoQ vs 10.70% YoY. GNPA at 1.00% vs 1.20% QoQ vs 1.13% YoY
2. Coforge 1QFY27 review: reported revenue grew 22.3% qoq in constant currency (cc) terms, vs
   estimate of +21%. Organically, Coforge delivered growth of 1.1% qoq in cc terms vs est of 0.2%. Order inflow at US$691mn in 1Q was towards the top end of the range of ~US$500-700mn seen in the past few quarters, but includes benefit from encore. Adj EBIT margin (16%) beat est by 36bps (15.6%).
3. Capri Global Q1FY27 Result Update: Strong headline set. Lower fee income offset by operating leverage resulting propelling operating profitability. CC in check. NII at Rs 737cr vs Rs 595cr QoQ vs Rs 412cr YoY (24% QoQ and 79% YoY). PPOP at Rs 533cr vs Rs 427cr QoQ vs Rs 310cr YoY (25% QoQ and 72% YoY). PAT at Rs 353cr vs Rs 283cr QoQ vs Rs 175cr YoY (25% QoQ and 101% YoY)
4. Home First Finance Q1FY27 Result Update: AUM growth & disbursements remain robust as balance transfer outflows decline; margins and asset quality remain resilient. NII at Rs 231cr vs Rs 217cr QoQ vs Rs 167cr YoY (6.54% QoQ and 38.11% YoY). PPOP at Rs 224cr vs Rs 211cr QoQ vs Rs 168cr YoY (6% QoQ and 33% YoY). ROA at 4.2% vs 4.1% QoQ vs 3.7% YoY
5. Balaji Amines Q1 Results Update: Balaji Amines Q1FY27: Revenue up 27% YoY to ₹456 Cr on pricing gains; PAT nearly doubles YoY as Amines margins snap back; DME plant commissioned. Amines margins snap back to ~23% EBIT as West Asia led pricing gains flow (likely to reverse Q3 onwards) and DME ramp drive PAT to a near-double YoY; Hotel business remains a drag and rising Non Controlling Interest hints at BSCL subsidiary turning around. Revenue +27% YoY / +15% QoQ to ₹456 Cr. Amines & Speciality Chemicals carries the whole story — segment EBIT +132% YoY.
6. Aeroflex posts record quarter — revenue up 72% YoY, PAT up 162%, driven by explosive growth in liquid cooling skid business

IN-LINE EARNINGS

1. NA

WEAK EARNINGS

1. Godfrey Phillips Q1FY27 hit hard by steep excise duty hike — PAT down 44% YoY, margins compressed sharply despite resilient volumes. EBITDA ₹182 cr, down 46.2% YoY; EBITDA margin 3.2% vs 8.3% in Q1FY26 — compressed by the steep excise tax increase in Q4FY26.

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

Disclaimer: This newsletter is for informational purposes only and should not be construed as investment advice. Please consult your financial advisor before making any investment decisions.