Heckyl FIND

How News based EWS can identify distress corporate borrowers ahead of time

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Corporate default or bankruptcy do not happen overnight. There is a sequence of events such as layoffs, legal/ regulatory issues and management change leading to default or bankruptcy.

In our view, unstructured data sets such as news is an important piece of information that can detect such a sequence of events prior to default. 

Our hypothesis is that deep-dive analytics on news data can capture the pre-default behavior of corporates. At the same time, it can also help banks to identify distress corporate borrowers ahead of time. 

To test our hypothesis, we analyzed news data for 12 US-based oil and gas exploration & production companies which went bankrupt in the past 2-years. 

Key takeways from News EWS study

Here, we present one such case of SandRidge Energy Inc which filed for bankruptcy protection in May 2016.

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SandRidge Sequence of Events

FiND Credit Risk EWS captures company-related red-flags based on a variety of business rules. Our intelligent EWS application can help lenders to get an early warning about the deterioration in corporate borrowers’ financial profile ahead of time.

To know more about FiND Credit Risk EWS, email us at info@heckyl.com

 

 

 

Tesla Model S outsells German rivals in Europe for first time in 4 years

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2017 was the first year when Tesla’s Model S outsold its German rivals in the luxury sedan segment in Europe. Model S was launched in Europe in 2013, the same year as Mercedes S-Class and has been the main rival of S-class till 2016 before outpacing it in 2017 (Image 1).

Globally, Model S remains Tesla’s best-selling model and constituted more than half (53%) of the global deliveries in FY17.

Tesla - German peers - Annual Sales[Image 1: Luxury sedan annual retail sales in Europe for top 4 players]

Model S retail sales grew at a staggering 38.6% in 2017. On the other hand, BMW 7-Series and Mercedes S-Class recorded a drop of 13.4% and 1.4% respectively in 2017. Meanwhile, Audi A-8 reported a modest growth of 9.6% in 2017. Read the rest of this entry »

Sensex cos aggregate revenues likely to grow in Q3: Heckyl news study

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Heckyl news study has indicated a rise in Sensex companies’ aggregate revenues for the third quarter of the financial year 2018. Heckyl has developed an indicator to measure Sensex companies’ revenue visibility through analysis of growth-oriented news flow for the quarter. Our analysis showed that the movement in growth-oriented news flow and its underlying sentiment for the particular quarter can accordingly move Sensex companies’ aggregate revenues in the subsequent quarter.
We have analyzed nearly 60,000 growth-oriented news items for Sensex companies for the past 10-quarters. We identified 15 growth-oriented news categories which can have the potential impact on the company’s future revenue growth. Some of the growth-oriented news categories are contracts, expansion, product launch, M&A, fund-raising and business transactions. Based on the news volume and sentiment for these growth-oriented categories, we have prepared Heckyl Company Growth Indicator for Sensex companies.
Our back-testing has shown a strong positive 1-quarter lead-lag correlation (0.79) between Heckyl Company Growth Indicator (leading indicator) and aggregate quarterly net sales (lagging indicator) for Sensex companies for September 2015 to September 2017 period. In other words, Heckyl Growth Indicator for September 2017 quarter can act as a leading indicator for Sensex companies’ aggregate net sales for December 2017 quarter.
Heckyl Company Growth Indicator has correctly predicted the trend for Sensex companies’ aggregate net sales for the past 6 out of 7 quarters (Chart 1).
Chart 1

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NMDC news sentiment jumps to 1-year high on extremely positive media coverage

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News sentiment for the state-run mineral producer NMDC soared to the highest level in the past 12-months as the positive media coverage gained momentum during December 2017. At 51, Heckyl sentiment score 50-day moving average (DMA) was at the highest in the past 1-year on Jan. 2, 2018.

At the same time, positive press coverage was also reflected in the share price (Image 1). Since November 30, NMDC has appreciated nearly 17% as buoyant news sentiment fueled optimism about the future prospects.

NMDC_Share_Sentiment
[Image 1: NMDC share price and news sentiment chart]

Production, ratings, contracts, product pricing, and expansion related news items dominated NMDC’s media coverage in the past 1-month (Image 2). Moreover, news coverage under these categories was extremely positive during this period.

NMDC_Top Topics
[Image 2: Top 5 News Topics for NMDC]

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Cadila Healthcare leads ANDA approvals among Indian drug makers

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Cadila Healthcare secured the highest number of ANDA (abbreviated new drug application) approvals among Indian pharmaceutical companies during the past nine month period.

The country’s fourth-largest drugmaker by market cap has received 70 ANDA approvals in the current financial year (Image 1). Out the total, 21 ANDA approvals were received by the company during the previous quarter. 

The drug makers are required to obtain ANDA approval from the FDA to manufacture and market the low-cost generic alternative to the brand-name drug in the US market.

Cadila Healthcase - ANDA
[Image 1: FiND Compare screen highlights ANDA approvals for top 5 Indian drugmakers]
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Tesla dominates media coverage among major automakers in 2017

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Product launch, alternative energy top news topics for global automakers 

Surge in news volume highlighting alternative energy signals the automotive industry is moving towards electric vehicles at top speed

Tesla Inc. topped the media coverage among 20 major global automakers in 2017 followed by Volkswagen, Ford Motor, and Toyota (Image 1). Tesla generated a lot of media frenzy around its market launch of Model 3 and unveiling of Roadster and Tesla Semi during this year.
Top 20 - Share of Voice
[Image 1]

FiND, an alternative data platform showed a surge in news flow highlighting alternative energy for all major automakers globally (Image 2). Automotive product launches generate lots of media coverage and thus it topping the list is understandable.
Category Wise News Flow
[Image 2]
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Sanofi’s 16% of sales is at risk

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French drug-maker Sanofi faces risk to its 16% of revenues after its top-selling drug Lantus came under threat from the generic manufacturers. The fear of losing revenue from Lantus has forced Sanofi to defend its intellectual property rights. Recent news flow showed that the maker of Lantus drug filed several patent infringement suits against the generic manufacturers.

Lantus, an “Insulin glargine” (a long-acting basal insulin analogue), accounted for 16.4% of Sanofi’s net sales in 2016. Lantus consists of microcrystals, which slowly releases insulin over a period of 24 hours with a peak-less profile. This drug helps in controlling the blood sugar of diabetic people.

Lantus is one of the major drugs in the anti-diabetic segment. In 2015, Lantus accounted for ~17% of the global sales for anti-diabetic products.

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