· Expects market to open on a strong note on account of across the global markets rally after resolved on overhang US debt ceiling negotiation. Global equity markets welcome on US debt selling deal after White House and Republican negotiators reached a tentative agreement to raise the nation’s debt ceiling. As a result, Asian market, US Future gained between 1-2% boosted sentiment after the President Joe Biden and House Speaker Kevin McCarthy voiced confidence their tentative agreement will pass Congress, where it will be voted on as early as Wednesday. US market is shut today. Back home, SGX Nifty is up nearly 170 points or 1%. Strong FIIs inflow and IMD forecast of normal monsoon will be positive for the market sentiment. Moreover, impressive quarterly results, favourable government policy, stable oil price and strong macro data will help domestic market to touch near record high as the Nifty is just 2% or 380 points away from the record high. Strong participation by FPI during the month of May due to FPI investment hits 6-Month high in May. Expects positive for FMCG and Auto stocks on hope of good monsoon and ahead of auto monthly sales to be release this week. Beaten down metal stocks expected to be bounce back on account of favourable risk-reward and hope of improve global demand ahead of US debt ceiling negotiation. IT stocks expected to be positive after global IT major Index Nasdaq Composite surged to nearly 13-month high.
· US Market - Equities rebounded sharply on Friday amid signs of progress on debt-ceiling negotiations, which offset a slew of economic data signaling additional interest-rate hikes could be coming. The S&P 500 Index climbed 1.3% in a broad-based rally. Nasdaq Composite climbed up by 2% while Dow Jones gained 1%. Investors bet Friday that the impasse over a debt ceiling
· in Washington may be nearing an end, with Republican and White House negotiators reportedly moving closer to an agreement to raise the debt limit and cap federal spending for two years.
· Global market summary – Global market gained after the US Officials agree on tentative debt negotiation deal, US Volatility Index declined 7% on Friday. The deal reached late Saturday includes a two-year appropriations agreement that keeps non-defense spending roughly flat with current levels, a person familiar with the deal said, speaking on condition of anonymity. It also suspends the debt limit through January 2025 — after the next presidential election.
· Asian Market – US stock futures and Asian equities advanced as appetite for risk taking returned to global markets following the deal between President Joe Biden and House Speaker Kevin
· McCarthy on the US debt ceiling. Japan, Taiwan, South Korea and Australia Index gained 1% each.
· European Market – European stocks jumped the most in two months on Friday as optimism increased about an agreement to end the US debt-ceiling impasse, while technology shares extended their rally. UK, Germany and France Index gained over 1% each.
· Oil – Oil prices rose 2% to $77/bbl Oil advanced after President Joe Biden and House Speaker Kevin McCarthy reached a tentative deal over the weekend on the US debt ceiling, likely averting a catastrophic default.
· Gold – Gold fell to the lowest in two months after revisions to US data pointed to the robustness of the economy, cementing bets on more monetary tightening this year.
· Previous Day market Update – There was renewed buying in the Index heavyweight Reliance Industries, Hindustan Unilever, TCS, Maruti, Sun Pharma and HCL Tech that lifted Nifty nearly 1% to close nearly 18500 mark. IT, metal, FMCG, capital goods, mid-cap and small cap stocks were major gainers today. FMCG, Nifty mid-cap and small cap sectors closed on all time high. Sentiment boosted after the IMD said that Southwest monsoon seasonal (June to September) rainfall over the country as a whole is most likely to be normal (96 to 104% of Long Period Average (LPA). impressive June series F&O roll over and continued FIIs buying interest also added fuel in the market. FIIs over Rs20000cr net buyers this month (May) while Nifty June rollover reported at 71% vs 3 months average at 70%. Signs of progress in US debt-ceiling talks, an advance in US and Asian equities and better than expected US Q1 GDP data and Jobless claim lifted global markets. Sensex jumped 629 points or 1 per cent to settle at 62,502. During the day while Nifty climbed 178 points or 1 per cent to end at 18,499. Previous day, both FIIs and DIIs were net buyers Rs350cr and Rs1841cr respectively
· Nifty Technical Levels - Nifty formed a Bullish candle on daily scale and gave the highest daily close of the last 110 sessions. Index has been witnessing buying interest at key levels which is keeping the overall momentum intact to commence the next leg of rally. It formed a Bullish candle on weekly frame and has been forming higher highs from the last nine weeks. Now it has to hold above 18442 zones, for an up move towards 18600 and 18888 zones while on the downside support exists at 18333 and 18281 zones.
· Bank Nifty Technical Levels – Bank Nifty negated the formation of lower highs - lower lows on daily scale after two sessions and formed a Bullish candle. On weekly scale it formed a Bullish Pin Bar with long lower shadow as buying is visible at lower zones. Now it has to continue to hold above 43750 zones for an up move towards 44144 then 44500 zones while on the downside support exists at 43600 then 43500 zones.
· Actionable BUY – Sun Pharma, Reliance Industries, Info Edge, Aurobindo Pharma, Mindtree. Tata Motor
· Brokers Radar – M&M – CLSA TGT at 1700, Morgan Stanley TGT at 1578, JP Morgan TGT at 1585. Morgan Stanley TGT on ONGC 218. Grasim – TGT by Morgan Stanley at 1910 and Jefferies TGT at 2105. Sun Pharma – Morgan Stanley TGT at 1170.
· Results – Adani Transmission, Allcargo, Hedielbag Cement, Hikal, Jindal Poly, IRCTC, Ipca Labs, ITI, Jindal Poly, Kovai Medical, Jub,ianl Pharmo, Lakshmi Mills, Monte Carlo, Nocil, Natco Pharma, OnMobile Global, Specialty Restaurant, SML Isuzu, Star Paper, Torrent Power, TCNC Clothing, RITES, PFC sign MoU to foster collaboration in Transport & Logistics and other infra sectors
· Corporate Action ex-dividend - M&M Forging Rs6, Anand Rathi Wealth Rs7
· Global Data – US market is shut today
· Market Summary – General Atlantic and Advent closer to buying Everstone's Burger King stake, Baring EQT set to buy HDFC's education loan arm Credila for up to $1.5 billion, IMD Forecast normal monsoon this year, NCLAT directs NSE, BSE to review grant of NOC on Zee –Sony Merger, Sun Pharma, Aurobindo Pharma, Samvardhana Motherson, Global Health, Info Edge and JK Cement announced impressive Q4 results. ONGC announced lower than expected Q4 results. Gravita expands capacity of its Chittoor Plant. Sun Pharma to acquire Taro's 100% stake in all-cash
· Baring Private Equity Asia (BPEA) EQT is set to acquire Credila Financial Services, the educational loan arm of Housing Development Finance Corp (HDFC), for $1.3-1.5 billion (Rs 10,000 crore-12,000 crore), trumping private equity rivals Carlyle, TA Associates, Blackstone and CVC Capital, among others, said people in the know. – ET Report – positive
· Restaurant Brands Asia (RBA) - General Atlantic and Advent International are at an advanced stage in their bid to acquire private equity firm Everstone Capital's 40.9% stake in Restaurant Brands Asia (RBA), which operates fast-food chain Burger King in India, said executives aware of the matter.
· Sun Pharma – Company has offered to acquire the outstanding shareholding in its US subsidiary, Taro Pharma for around $300 million through a reverse triangular merger. In the all cash deal, Sun Pharma will acquire the shares at a price of US $38 per ordinary share, which will be payable in full at the close of the proposed transaction.
· Focus on FMCG, Auto and Fertilizer stocks on ahead of normal monsoon - IMD said that Southwest monsoon seasonal (June to September) rainfall over the country as a whole is most likely to be normal (96 to 104% of Long Period Average (LPA). – expects Positive FMCG (HUL, Dabur India, Tata Consumers, Britannia), Auto (M&M, Escorts, Hero Motocorp, Maruti) and Fertilizer (GSFC, GNFC)
· FPI investment Hits 6-Month High in May - Foreign investors have made a noteworthy investment in Indian equities, totaling Rs 37,316 crore from May 2 to May 26, 2023, marking the highest level of investment in six months.
· Moody's changes Jaguar Land Rover's outlook to positive from stable; B1 ratings affirmed - Moodyʼs Investors Service (Moodyʼs) has changed Jaguar Land Rover Automotive Plcʼs (JLR) outlook to positive from stable.- positive
· Engineers India – Company’s order book at Rs4708cr as of March 31 – Positive
· Zee Entertainment- Appellate tribunal set aside an order from a court in Mumbai that had asked exchanges to reconsider their approval of the company’s merger with Sony. The National Company Law Appellate Tribunal said that the lower tribunal’s May 11 order was passed without adequate hearing from Zee – positive
· Reliance - India’s biggest company Reliance Industries is seeking to dominate the country’s $10bn online domestic fashion market, striking a deal with Shein that will allow the rapidly growing Chinese retailer to return to the world’s most populous nation. – positive
· Adani Green – Company commissions 130MW wind power plant at Kutchh. Company’s operational wind generation capacity crosses 1GW.
· Mphasis – Company announced its strategic partnership with Kore.ai, the world’s leading enterprise conversational AI platform and solutions company, to bolster its offerings to transform customer experience management and employee engagement for their enterprise clients. - positive
· BHEL – Company names Jai Prakash Srivastava as CFO – Positive
· Aurobindo Pharma has received the final approval from the U.S. FDA) to manufacture and market Carboprost Tromethamine Injection USP 250 mcg/mL, single-dose vials – positive
· Dalmia Cement: Subsidiary Dalmia Cement (North East) has approved capital expenditure to the tune of Rs 3,642 crore for setting up new clinkerisation unit of 3.6 MTPA at Umrangso unit, and new cement grinding unit of 2.4 MTPA at Lanka unit. The said capex will be funded via a mix of debt, equity & internal accruals and the proposed capacity is expected to be added by FY25-26.- positive
· Adani Wilmar said it has entered into the whole wheat category with its brand Fortune. The company guarantees to provide premium wheat seed varieties such as Sharbati, Poorna 1544, Lokwan, and MP Grade 1. It aims to consistently increase market share and expand into high-value metro markets such as New Delhi, Mumbai, Pune, Surat and Ahmedabad.
· Aster DM Healthcare -Board is in the process of reviewing proposals from potential buyers for the sale of ‘Gulf Co-operation Council' (GCC) region business. The binding bids are likely to be received by end of June quarter of financial year 2023-2024. Disclosures will be made subject to board's approval. GCC revenue for the said quarter includes Covid testing and vaccination income of six crore rupees, as compared to Rs 217 crore in the same period of the previous fiscal. – Long term positive.
· Ethos: Subsidiary Silvercity Brands AG has acquired 100% stake in Swiss-based Favre Leuba GmbH. Now Favre Leuba GmbH has become the wholly owned subsidiary of the Silvercity Brands AG and thereby, step - down subsidiary of Ethos with immediate effect. - positive
· RITES and PFC – Company has signed a MoU with PFC to explore avenues of mutual collaboration for consultancy works in sectors such as Transport & Logistics, Energy, Water & Sanitation, Communication, Social and Commercial Infrastructure. As part of the MoU, RITES will provide expertise for Pre-Feasibility Reports, Detailed Project Reports, Transaction Advisory, Project Management services, Audits, and Inspection, where PFC and its subsidiaries propose to provide financial assistance for infrastructure projects in India and abroad. – positive
· Alfa Transformers – Company has been awarded 500 KVA LINE VOLTAGE REGULATING TRANSFORMERS orders from TATA POWER – positive
· Gravita India - Company has increased capacity of its existing recycling unit situated at Chittoor, Andhra Pradesh ("Facility"). The existing capacity of said unit for Battery recycling has been increased by 26,440 MTPA bringing the total capacity of Battery recycling of this unit to 64,640 MTPA. – Positive
· Praveg Ltd forms subsidiary in Tanzania, subsidiary is incorporated to carry on the business of Tourism, Hospitality and to do all other allied and incidental activities in this regard.- positive
· Ward Wizard Ltd – Company has launched five new delectable items to its already impressive menu at all of its outlets. The new menu includes a variety of delicious and mouth-watering dishes that are sure to tantalize the taste buds of foodies across the country.
· IPO-bound Yudiz Solutions - A blockchain, AI, and gaming focussed enterprise technology company has received an NSE approval for an SME IPO. With this approval, the company is set to invest approx Rs8cr to set up a gaming studio and a multi-gaming platform. The game studio will aim to produce over 40 games in a year.
· Reliance Industries: Step-down FMCG subsidiary Reliance Consumer Products completed the acquisition of a 51% controlling stake in Lotus Chocolates for an aggregate consideration of Rs 74 crore and subscribed to non-cumulative redeemable preference shares of the company for Rs 25 crore.
· Dividend - Grasim Rs10, Info Edge Rs9, M&M 16.25, dividend Rs9, Grasim Rs10, Finolex Cable Rs7. Chambel Fertilizer Rs3, HUDCO Rs3.10, Bharat Bijlee Rs40, Styrenix Performance Rs24, Repco Home Rs2.70, Alphageo Rs8, Sal Automotive Rs4, Garware Hi-Tech Rs10, Finolex Cable Rs7, Nucleus Software Rs10, Ambika Cotton Rs35, BEML Rs5
· BHEL announced Q4 net profit Rs611cr (down 33% YoY), Ebitda Rs1098cr (down 13.7% YoY), and Income Rs8062cr (down 2% YoY)
· Engineers India announced impressive Q4 results. Company reported Q4 net profit Rs190.8cr (down 140.33% YoY), Ebitda Rs211.8cr (up 39% YoY), and Income Rs880.10cr (up 7.6% YoY)
· Nucleus Software Q4 Income Rs206.2cr (up 22% QoQ), Ebitda Margin at 40.2% vs 28.3% (QoQ), Ebitda Rs82.8cr (up 72.9% QoQ) and net profit Rs67.6cr (up 72% QoQ)
· KPI Green Q4 Income Rs182.4cr (up 183% YoY) and net profit Rs31.7cr (up 217% YoY)
· Finolex Cable Q4 net profit Rs175cr (down 22% YoY), Ebitda Rs145.7cr (up 21.7% YoY) and income Rs1224cr (up 3.2% YoY)
· Samvardhana Motherson announced better than expected Q4 results. Company reported Q4 Income Rs22476cr (up 31% YoY) – Expectation Rs21525cr, Ebitda Margin at 9% vs 7.3% (YoY) – expectation 7.7%, Ebitda Rs2020.7cr (up 59.7% YoY) – expectation Rs1647.9cr and net profit Rs654cr (up 436% YoY) – expectation Rs458.5cr
· Infoedge announced strong Q4 results. Q4 Income Rs604.7cr (up 1.6% QoQ) – Expectation Rs559cr, Ebitda Rs220.3cr (down 1.7% QoQ) – expectation Rs205cr, Ebitda margin flat at 39% (QoQ) – Expectation 36.5% and net profit 178.9cr vs loss Rs84.3cr – expectation Rs180cr
· M&M Q4 Income Rs22571.4cr (up 31% YoY) – Expectation Rs22229.8cr, One time loss Rs512cr vs gain Rs125cr, other Income Rs334cr (up 45% YoY) – Expectation Rs213.1cr, Ebitda Margin at 12.4% vs 11.2% (YoY) – expectation 12.4%, Ebitda Rs2797.4cr (up 44.5% YoY) – expectation Rs2760.5cr, raw materials cost Rs16758cr (up 38% YoY) and net profit Rs1549cr (up 221% YoY) – expectation Rs1576.2cr
· Grasim Q4 Income Rs6645.8cr (up 4.2% YoY) – Expectation Rs6250cr, Ebitda Margin at 6.4% vs 11.8% (YoY) – expectation 11.5%, Ebitda Rs426cr (down up 43.4% YoY) – expectation Rs720cr and net profit Rs93.5cr (down 88.5% YoY) – expectation Rs320cr
· Sundaram Finance Q4 net profit Rs433.2cr (up 27.4% YoY) and Income Rs1483.6cr (up 16.7% YoY)
· Sun Pharma Net profit Rs1984.5cr (up 25.4% YoY) – Expectation Rs2100cr, Ebitda Margin at 25.6% vs 24.8% (YoY) – expectation 25.8%, Ebitda Rs2803cr (up 19.7% YoY) – expectation Rs2886.7cr and Income Rs10930.6cr (up 15.7% YoY) – expectation Rs11188.6cr
· Global Healthcare announced strong quarterly results and Ebitda margin. Company reported Q4 Net profit Rs101.3cr (up 477.6% YoY), Ebitda Rs165.9cr (up 112.2% YoY), Ebitda margin 23.6% vs 15% (YoY) and Income Rs703.4cr (up 35.2% YoY)
· Aurobindo Pharma announced better than expected Ebitda and Ebitda margin. Company reported Q4 Net profit Rs505.7cr (down 10.3% YoY) – expectation Rs493.1cr, Ebitda Rs1002.2cr (up 2.9% YoY) – expectation Rs945.9cr, Ebitda margin 15.5% vs 16.8% (YoY) – expectation 15.5% and Income Rs6473cr (up 11.4% YoY) – expectation Rs6321.1cr
· JK Cement Ebitda in line with expectation and Ebitda/pt in line with expectation. Company reported Q4 consolidated EBITDA/t at Rs748 (estimates Rs753). Net profit Rs122.1cr (down 38.1% YoY) – expectation Rs135.6cr, Ebitda Rs349.5cr (up 9% YoY) – expectation Rs339.2cr, Ebitda margin 12.6% vs 16.2% (YoY) – expectation 13% and Income Rs2777.9cr (up 18.1% YoY) – expectation Rs2606.4cr
· Indigo Paints announced in line with expected income while reported better than expected Ebitda margin. Company reported Q4 Net profit Rs48.7cr (up 40.7% YoY) – expectation Rs34.9cr, Ebitda Rs71.7cr (up33.4% YoY) – expectation Rs51.5cr, Ebitda margin 22% vs 18.60% (YoY) – expectation 16.2% and Income Rs325.5cr (up 12.9% YoY) – expectation Rs317.6cr
· ONGC announced lower than expected Ebitda due to higher other expense . Company reported Q4 Net loss Rs250cr vs profit Rs8860cr (YoY) while adjusted profit Rs2090cr – expectation Rs10930cr, Exceptional items Rs9240cr (due to on-going dispute regarding applicability of service tax and GST on Royalty), Ebitda Rs16340cr (down 20% YoY) – expectation Rs20960cr, other expenses Rs8960cr vs 4540cr (QoQ) – adjusted exceptional loss Rs9240cr, Ebitda margin 22% vs 18.60% (YoY) – expectation 16.2% and Income Rs36290cr (up 5% YoY) – expectation Rs38060cr
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