News and Impact

News and Impact 

 

 

·      Expects markets to open on a positive note on account of rally in the across the global market as hope grew for a U.S. debt ceiling deal. Optimism for a US debt-ceiling deal, fall in US Job data along with Housing data and better than expected Walmart results lifted Nasdaq by 1.5% to close at 13-month high and S&P 500 advance 1% to close 9-month high. Markets expect that Fed will start cutting interest rates in the second half of the year after the US existing Home Sales decreased by 3.4% month-over-month in April. On the other hand, US House Speaker Kevin McCarthy said a debt-limit deal will likely be considered on the House floor next week and told reporters discussions were in a “much better place” than before. A positive earnings outlook from consumer bellwether Walmart Inc. also added fuel in the market sentiment. However, US dollar Index surged to 2-month high and spiked in US 10-year and 2-year bond yield is a concern in the market. Asian markets open on a positive note and marginally gain US Future. SGX Nifty advance quarter percent today. Yesterday, Nifty declined over half percent from the intra-day high and fell in the last three trading sessions on account of profit booking. Strong FIIs inflow, good quarterly results and impressive micro data will be positive for the market sentiment. Recent fall (Sensex declined 900 points last 3-day) is a good opportunity to buy on domestic equity. We are positive on banks, auto, NBFC and defense stocks. Both SBI and ITC announced impressive Q4 results yesterday. Defense stocks will be focus after the news that the HDFC Mutual Fund will launch India's first defence fund.

 

·      US Market –. US stocks closed higher on mounting optimism that a debt ceiling deal could be reached within days, with discount retailer Walmart providing additional support after an upbeat

·      annual sales forecast. Nasdaq Composite surged 1.5% to close 13-month high while S&P 500 gained nearly 1% to close 9-month high

 

·      Global market summary – Nasdaq closed 13-month high, S&P 500 closed 9-month high, US Dollar Index spiked to 2-month high of above 103, US 10-Year yield surged to 1-month high at 3.63 and over 1-month high of 4.21%. Gold price fell to 6-week low, Japan CPI spiked to 40-year high at 3.4%

 

·      Asian Market – Asian stocks advanced alongside US equity futures on rising hopes that lawmakers in Washington will avert a first-ever US default. Shares in Japan, Australia and South Korea all edged higher by half percent. The advance for the Topix Index placed the gauge of Japanese blue chips on course for its best week since November and a fresh 33-year high.

 

·      European Market –  European stocks bounced after two days of losses following Wednesday’s gains on Wall Street, as investors were optimistic about a breakthrough in US debt-ceiling talks.  Both Germany and France Index gained 1% higher while UK Index gained 0.3%.

 

·      Oil –  Oil declined marginally to below $76/bbl headed on account of slowdown in the global demand and optimism that the US will avert a catastrophic debt default.

 

·      Gold –  Gold declined 2% to 6-week low at $1955/ounce (fell to below 20-DMA) as traders tracked talks to resolve the US debt-ceiling impasse and dissected comments from a slew of Federal Reserve officials on the outlook for interest rates.

 

·      Previous Day market Update –Equity benchmark Nifty reverse the intra-day gain and declined for third trading sessions on account of profit in heavyweights ITC, SBI, L&T, Hindustan Unilever and Maruti. Nifty dropped 52 points or 0.3% to end at 18,130 while touched intra-day high of 18297. PSU Bank Index slipped nearly 2% after the banking major SBI announced Q4 results. FMCG index slipped over 1% lower after ITC announced Q4 result which was in line with expectation. Nifty realty index nosedived over 2% followed by pharma, mid-cap and small cap sectors. Sensex declined 129 points or 0.21% to settle at 61,432. Sensex fell 900 points or 1.5% in the three trading sessions. Traders were booking profit from the higher level after announced mixed bag of quarterly results and lingering concerns about a standoff in US debt-ceiling negotiations. FIIs were net buyers Rs970cr while DIIs were net sellers Rs850cr yesterday.

 

·      Nifty Technical Levels -  Nifty is facing pressure at higher zones with third consecutive Bearish candle and finally closed with losses of around 50 points. Now till it holds below 18181 zones, some more profit booking could be seen towards 18081 and 18018 zones while on the upside hurdle exists at 18218 and 18333 marks.

 

·      Bank Nifty Technical Levels – Bank Nifty breached its hourly support of 43800 zones and drifted swiftly towards 43675 levels and remained volatile to close near 43750 zones. It formed a Bearish candle on daily scale as selling pressure was seen at higher zones. Now till it holds below 44000 zones, bounce could be sold for some weakness towards 43500 then 43333 levels while on the upside hurdle is seen at 44000 then 44144 marks.

 

·      Actionable BUY – Lemon Tree Hotel, Manyavar, Hudco, Ramco Cement

 

·      Brokers Radar –  SBI – CLSA TGT at 725, Morgan Stanley TGT at 715,  JP Morgan TGT at 730, Goldam Sachs TGT at 746, CITI TGT at 710, Macquarie TGT at 695. ITC – Morgan Stanley TGT at 474 from 415, JP Morgan TGT at 425, Jefferies TGT at 520, Nomura TGT at 485 and Goldman Sachs TGT at 470

 

·      Events – Nexus Trust listing today and subscribed over 5 times,  Manyavar or Vedant Fashion OFS for retail segment at Rs1161, G-7 meeting at Japan

 

·      Results –  Abbott India, Alkem Labs, CG Consumers, Dalmia Sugar, Glenmark Pharma Godrej Industries, JSW Steel, Kirloskar Oil, Minda Corp, Motherson SWI, NTPC, Power Grid, Route Mobile, Taj GVK and Zomato.

 

·      Corporate Action  - Home First Finance Rs2.60, Shree Ram Proteins – stock split from Rs10 Re1, Tata Consumers Rs8.45

 

·      Global Data – Consumers Confidence (UK), PPI (Germany). 

 

·      Market Summary – United Spirits announced impressive quarterly results, USDINR surges to 2-month high at above 82, Everstone in talks to sell 41% stake in India's Burger King franchisee, GAIL, Indigo announced lower than expected Q4 results, ITC and SBI reported in line with expected Q4 results, Ramco Cement announced strong Q4 results,  Zydus Life reported impressive Q4 results, Reliance Retail partnership with  China retail giant Shein, Manyavar's Non-retail OFS fully subscribed nearly 2.2 times more bids

 

·      USDINR - The rupee surged by 25 paise to close at 82.62 against the US currency on Thursday, weighed down by a strong greenback in the overseas market and a negative trend in domestic equities – Rising USDINR is a concern in the market

 

·      Reliance Industries - Reliance Retail is set to bring back Chinese fashion giant Shein to India through a strategic partnership, more than two years after the latter’s app was banned by the Indian government – positive

 

·      Nazara Technologies: Nazara Technologies' subsidiary NODWIN Gaming on Thursday announced that it has signed a definitive to raise $28 million crore from new and existing investors - Positive.

 

·      Wipro – Company in 5-year business partnership with Servicenow – positive

 

·      REC: REC is set to significantly expand its loan book under the renewable energy (RE) portfolio, aiming for Rs2.4 lakh crore by the financial year 2030.

 

·      Manyavar's Non-retail OFS update - The offer for sale (OFS) launched by Vedant Fashions,

·      that operates ethnic wear brand Manyavar, garnered nearly 2.2 times more bids than the shares on offer. The floor price for the OFS has been set at Rs 1,161 – Today for Retail segment

 

·      Rail Vikas Nigam (RVNL) – Company – NHAI JV to build multi model logistic parks – positive

 

·      Restaurant Brands Asia – Restaurant Brands Asia  (RBA) - Media reports that a consortium of private-equity firms, including Advent and General Atlantic, and Jubilant Foodworks are among entities in talks to buy Everstone’s entire 41% stake in Restaurant Brands Asia. – Stock gained 14% yesterday.

 

·      NDTV To Launch Nine News Channels In Different Indian Languages -  Company has approved a proposal to seek permission of Ministry of Information and Broadcasting for launch of nine news channels in different Indian languages in phases. – Positive

 

·      Tata Elxsi: Tata Elxsi Ltd on Thursday reported a 26% year-on-year rise in its net profit for the fiscal's fourth quarter ended March (Q4FY23) to ₹201.5 crore. The Tata Group company had reported a profit of ₹160.01 crore in the year-ago period. The company's revenue from operations for Q4FY23 rose 23% on year to ₹838 crore from ₹681.7 crore

 

·      BPCL – Company has entered into a strategic Memorandum of Understanding (MOU) with Aspen Technology Inc., USA. This partnership aims to integrate Aspen Tech's process simulation solution with BPCL's BPMARRK® software, enabling the generation of complete assay data within a fraction of the time it would traditionally take using laboratory methods. – Positive

 

·      K&R Rail Engineering – Company has received a work order, from M/s. JK Cement Limited for the Design and Survey work of Railway Siding Project at Muddapur in Bagalkot District of Karnataka State valued at more than Rs.300 Crores.- positive

 

·      Bharti Airtel – Company announced that it has surpassed the 2 million unique 5G user mark on its network in Tamil Nadu. – positive

 

·      Nippon Life – Company announced the appointment of Mr. Ashish Chugani as the Head of Alternative Assets for its AIF business. - positive

 

·      GAIL – Company expects to get four liquefied natural gas cargoes each in May and June from Germany’s SEFE Marketing and Trading. The Singapore unit of SEFE Marketing, formerly known as Gazprom Marketing & Trading Ltd., had stopped supplies under a long term contract to GAIL since mid-2022.  Company is planning capital expenditure of Rs10000cr ($1.2 billion) in FY24 and expects 6-7% growth in India gas demand in the financial year ending March 2024 – long term positive

 

·      Vedanta: The company’s board will meet on May 22 to consider the first interim dividend for fiscal 2023–24. The record date for the dividend, if approved, will be May 30. – positive on hope of higher dividend

 

·      BHEL : The company has given Jai Prakash Srivastava additional charge of the post of director (finance) for one year, effective April 18, 2023, to April 17, 2024. It also appointed Krishna Kumar Thakur as director (human resources) for a period of five years from the date of assumption of charge.

 

·      Dividend – Sikha Interplant Rs4, JK Tyre Rs2, Thermax Rs10, BDH Rs4, Honeywell Automation Rs95, Endurance Tech Rs7, SBI Rs11.30. ITC Rs6.75 and special dividend Rs2.75

 

·      Zydus Life better than expected Ebitda and Ebitda margin. Company reported Q4 net profit Rs297cr (down 255 YoY) – expectation Rs731cr, US sales Rs2250cr (up 58% YoY), India sales Rs1290cr (up 46% YoY), Ebitda Rs1256cr (up 46% YoY) – expectation Rs1081.3cr and Ebitda margin at 25.1% vs 22.3% - Expectation 22.6%, Gujarat Narmada Rs30

 

·      Restaurant Brands Asia announced impressive Q4 results. Company reported Q4 FY23 - Revenue rose 28.55% (YoY) to Rs 513.95 crore,  Ebitda up 35.41% (YoY) at Rs 27.38 crore,  Ebitda margin at 5.33% vs 5.06% and Net loss narrows to Rs 79.96 crore vs net loss of Rs 81.54 crore

 

·      Honeywell Automation India announced above Bloomberg estimates Q4 results -  Revenue up 27.2% (YoY) at Rs 849.68 crore (Bloomberg estimate: Rs 910.04 crore), Ebitda up 58.99% (YoY) at Rs 138.8 crore (Bloomberg estimate: Rs 132.14 crore) Ebitda margin at 16.34% vs 13.07% YoY  (Bloomberg estimate: 14.5%) and Net profit up 54.16% (YoY) at Rs 112.03 crore (Bloomberg estimate: Rs 104.68 crore)

 

·      Jindal Stainless announced above Bloomberg estimates Q4 results Q4 FY23 -  Revenue up 0.4% (YoY) at Rs 9,765.08 crore (Bloomberg estimate: Rs 10,508.67 crore), Ebitda down 19% (YoY) at Rs 1,143.93 crore (Bloomberg estimate: Rs 904.20 crore) Ebitda margin at 11.71% vs 14.52% YoY (Bloomberg estimate: 8.6%) Net profit down 19.96% at Rs 716.29 crore (Bloomberg estimate: Rs 603.07 crore)

 

·      SBI announced impressive Q4 results and reported lowest GNPA in the last 10 years. Company reported Q4 net profit Rs 16694cr (up 83.2% YoY) - Expectation Rs15170cr, provision Rs3320cr (down 42% QoQ) – expectation Rs6160, Loan growth 17% while expectation 16%, operating profit Rs24620cr (up 25% YoY) – expectation Rs26920cr, Loan loss provision Rs1280cr (down 12% QoQ), GNPA 2.78% vs 3.14% (QoQ) – expectation 2.9%, NPA at 0.67% vs 0.77% (QoQ) - expectation 0.7% and NII Rs40392.5cr (up 29.5% YoY) – expectation Rs40250

 

·      GAIL announced lower than expected Q4 results. Company reported Q4 Net profit Rs603.7cr (down 77% YoY) – expectation Rs937.6cr, Ebitda Rs307cr (up 17.6% YoY) – Expectation Rs1513.6cr, Company recoveres loan loss Rs4200cr vs Rs1643cr (QoQ) and fresh slippage Rs3190cr (up 3% QoQ), Ebitda margin 0.9% vs 0.7% (QoQ) – expectation 3.7% and Income Rs32843cr (down 7.1% YoY) – expectation Rs41468cr

 

·      Arvind Q4 announced poor Q4 results. Company reported Q4 net profit Rs 197cr (up 12.4% YoY), Ebitda Rs191 ( down 19.9% YoY), Ebitda margin 10.1% vs 10.8% (YoY) and Income Rs1880.8cr (down 14.4% YoY)

 

·      ITC announced impressive Q4 results and above expectation cigarette volume growth. Company reported Q4 Net profit Rs5087cr (up 21.4% YoY) – expectation Rs4730cr, Cigarette volume growth 14.2% vs 15% - expectation 13%, Ebitda Rs6209.3cr (up 18.9% YoY) – Expectation Rs6210cr, Ebitda margin 37.9% vs 33.6% (YoY) – expectation 38.7% and Income Rs16398cr (up 5.6% YoY) – expectation Rs16050cr

 

·      Gujarat Narmada announced poor Q4 results. Company reported Q4 Net profit Rs336cr (down 48% YoY)Ebitda Rs367cr (down 58% YoY),  and Income Rs2270cr (down 18% YoY) 

 

·      Orient Paper announced strong Q4 results. Company reported Q4 Net Profit  Rs50cr vs  loss Rs2.2cr, Ebitda  Rs68.4 vs 4.5cr and Income Rs258.5cr (up 35%)

 

·      Ramco Cement strong Q4 results of all fronts due to higher realization. Company reported Q4 net profit Rs152cr (22.6% YoY) – expectation Rs70cr, Ebitda Rs412 (up 39.5% YoY)– expectation Rs290cr, Ebitda margin 16% vs vs 17.4% - expectation 13% and Income Rs2568cr (up 50.2% YoY)– expectation Rs2260cr

 

·      Indigo announced lower than expected Ebitda and Ebitda margin. Company reported Q4 Net profit Rs916cr vs loss Rs1680cr (YoY) – expectation Rs2180cr, Ebitda margin at 20.9% vs 2.1% (YoY) – expectation 27.9%, Ebitda Rs2970cr vs Rs172cr (YoY) – expectation Rs4240cr, Total passenger 2.34cr (up 60% YoY), Capacity 49.2%, load factor 84.2% vs 76.7% (YoY) – expectation 80.1%, Debt Rs44850cr, cash Rs23420cr and Income Rs14160cr (up 77% YoY) – Expectation Rs15190cr

 

·      PNB Housing announced inline with expected Q4 results. Company reported Q4 Net profit Rs283cr (up 66% YoY) – expectation Rs290cr, GNPA 3.83%, impairments Rs145cr (down 43% QoQ) and Income Rs1630cr (up 15% YoY) – Expectation Rs1685cr

 

·      Gland Pharma announced lower than expected Q4 results. Company reported Income Q4 at Rs790cr (down 29% YoY) – Expectation Rs900cr, Ebitda margin at 21.5% vs 31.6% (YoY)- expectation 30%, Ebitda Rs170cr (down 52% YoY) – Expectation Rs270cr and net profit Rs120cr (down 59% YoY) – Expectation Rs220cr.

 

·      Container Corporation announced lower than expected Q4 results. Company reported Income Q4 at Rs2166cr (up 6% YoY) – Expectation Rs2195cr, Ebitda margin at 20.5% vs 20.2% (YoY)- expectation 23.3%, Ebitda Rs444.7cr (up 7.7% YoY) – Expectation Rs509cr and net profit Rs278.5cr (up 8.4% YoY) – Expectation Rs347.5cr.

 

·      United Spirits Company announced impressive Q4 results. Company reported Income Q4 at Rs2494cr (down 0.3%  YoY) – Expectation Rs2184cr, Ebitda margin at 13.7% vs 217.1% (YoY)- expectation 12.8%, Ebitda Rs338cr (down 21.1% YoY) – Expectation Rs279cr and net profit Rs212cr (down 24% YoY) – Expectation Rs156cr.