Bad loans problem brewing?🥴

Last week, we saw {TICKER-HDFC-HDFC}’s management caution the markets about rising bad loans from the COVID mess. Yesterday, {TICKER-BAJFINANCE-Bajaj Finance} echoed the sentiment, asking investors to brace for a horrible couple quarters at least as it struggles to see past all the haziness.

Flurry of downgrades from analysts followed — with many expecting a 10-15% drop in profits over the next couple quarters. Investor mood was promptly spoiled, and Bajaj Finance was dragged down 6% by the end of the day.

Bottomline — that's two of the most well managed financial services giants in India offering a pretty bearish view on the near term state of affairs.

What’s worse is that all of that’s running extremely counter to the market’s current unfettered exuberance.