News and Impact

News and Impact

 

 

·      Worries about debt-ceiling negotiation voting to be held today in the US Congress and lower than expected China PMI data, may open domestic market on a flat to negative note. SGX Nifty declined nearly quarter percent or 50 points while most of the Asian market fell half to one percent in the morning. US Future are exhibiting on a mixed bag. On the other hand, Brent crude nosedived 4% to 1-week low on account of weaker global demand and sufficient supply ahead of an upcoming OPEC+ meeting.  Overnight, US market ended on a mixed bag as investors weighed a tentative U.S. debt ceiling deal that needs Congress approval as well as the potential for another interest rate hike in June. President Joe Biden and Republican House Speaker Kevin McCarthy expressed confidence that they can muster the necessary support for the bill before voting commences, which could be held today. Back home, expects range bound market today on ahead of US voting outcome for debt ceiling deal. Moreover, domestic GDP number will be release in the post market today. Undertone bullish sentiment in the market on account of strong FIIs buying interest, impressive quarterly results and strong micro economy data. FIIs were net buyers over Rs2000cr yesterday, highest ever buying since Feb 2021 or 27 months high. FIIs bought $3bn or Rs24500cr during the month of May. Nifty is just 1.5% shy away from its all-time high level of 18,887, it hit in December 2022. Traders buy on dips strategy continue on account of  Nifty formed a bullish candle on daily scale and gave the highest daily close of the last 112 sessions. The Nifty Midcap 100 index already hit its all-time high along with the Nifty Bank. Bank Nifty also formed a bullish candle on daily scale and gave the highest ever close. Auto stocks will be in focus today ahead of monthly sales data will be announce tomorrow. Domestic CPI data and MSCI Global Standard Index today, as a part of the May rejig exercise. Euro zone CPI and GDP data will be release today. Expects positive for airlines, paints, cement stocks due to benefit of fall in oil price.

 

·      US Market   – U.S. stocks ended mixed on Tuesday as investors weighed a tentative U.S. debt ceiling deal that needs Congress approval as well as the potential for another interest rate hike in June. Dow Jones slipped 0.2% while Nasdaq Composite gained 0.3%

 

·      Global market summary –  US Congress Voting today for debt ceiling deal negotiation deal at 8.30PM in US Time. Brent Crude fell to 1-week low. S&P 500 ended 9-month high. China announced lower than expects May PMI data.

 

·      Asian Market – Asian stocks fell in the morning after momentum in US equities faded and Congress considered the debt accord that’s needed to head off a catastrophic default. Shares slipped in Japan, Taiwan and Australia. Hong Kong Index slipped over 1% after China announced lower than expects May PMI data.

 

·      European Market – European stocks dropped yesterday on account of poor economy data  and lower oil prices weighed on the energy sector, while Unilever Plc and Nestle SA dropped after announcing changes to the chief financial officer role. Both UK and France Index declined over 1% each as worries that central banks would keep interest rates higher for longer because of elevated inflation have also capped risk demand

 

·      Oil –  Oil held its biggest decline by in four weeks on signs of weaker demand and sufficient supply ahead of an upcoming OPEC+ meeting. Brent Crude  declined by 4% to 1-week low at $73/bbl.

 

·      Gold –   Gold gained 1% to $1966/ounce as Treasury yields slumped on hopes that US Congress will pass a debt-ceiling deal to avoid a default.

 

·      Previous Day market Update – After opening on a flat note,  equity benchmark indices closed marginally higher for the fourth straight day, inching closer to their record high levels amid continued purchases from foreign investors. Bajaj twins, HDFC twins, Hindustan Unilever, ITC, Infosys and Kotak Bank lifted Nifty to a positive territory. The Nifty Midcap 100 index already hit its all-time high along with the Nifty Bank. Sentiment boosted on account of rally in the global markets and US future on the hopes that Congress will pass a debt accord to head off a default as White House and Republican congressional leaders stepped up lobbying in support of the deal. On the domestic front,  strong FIIs buying interest, impressive quarterly results and IMD forecast of normal monsoon boosted the market sentiment. Sensex surged 123 points or 0.20% to settle at 62,969 and Nifty rose 35 points or 0.20% to end at 18,634. Financials, FMCG and select IT stocks were major gainers today while metal stocks witnessed profit booking. Nifty 500 stocks advance decline ratio was 1:1.  FIIs were net buyers Rs2090cr while DIIs were net sellers Rs439cr yesterday.

 

·      Nifty Technical Levels -  Nifty formed a Bullish candle on daily scale and gave the highest daily close of the last 112 sessions. Now it has to hold above 18550 zones, for an up move towards 18750 and 18888 zones while on the downside support exists at 18550 and 18442 zones.

 

·      Bank Nifty Technical Levels – Bank formed a Bullish candle on daily scale and gave the highest ever close. Now it has to continue to hold above 44144 zones for an up move towards 44750 then new life high of 45000 zones while on the downside support exists at 44144 then 44000 zones.

 

·      Actionable BUY – REC, LTIMindtree, Coal India, Prestige Estate, 

 

·      Brokers Radar –  Adani Ports – Goldman Sachs TGT at 800, Nomura TGT at 1075. CLSA TGT at 878, Citi 972,, PI Industries TGT by Philips Securities at 4095, Chambal Fertilizer TGT by Philips Securities at 384.  Nomura TGT on Sona BLW at 573, Torrent Pharma TGT – Goldman Sachs TGT at 2025 and Jefferies TGT at 1650 , JK Cement TGT by Jefferies at 3260.

 

·      Events – MSCI Re-balancing, GDP and Eight Infrastructure Data, Sona BLW and HDFC Life block deal today.

 

·      Corporate Action  - Macrotech bonus 1:1, SBI ex-dividend 11.30 and  DB Corp Rs3,

 

·      Global Data – Mortgage Application and US Fed Reserve Release Beige Book (US), CPI, Consumer Spending, GDP and PPI (France). CPI and Unemployment Change (Germany). Composite PMI, Manufacturing PMI and Non-Manufacturing PMI. (China)

 

·      Market Summary – Coal India raises high grade non-coking coal prices by 8%, Aureus Investment to sell 3.2% stake in Sona BLW today, Abrdn likely to sell 1.66% stake in HDFC Life via block deal today, TCS Bags Contract from Swedish Bank, Sun Pharma, Philogen Enter Agreement To Commercialize Skin Cancer Drug, RateGain's International Flight Bookings At Highest Since Pandemic, Prestige Estates buys out DB Group’s balance stake in 2 Mumbai projects for Rs1,176 crore, Apollo Hospital announced lower than expected Q4 Ebitda and Ebitda margin.  MSCI Global Standard Index 2023 Rejig Today

 

·      MSCI Global Standard Index 2023 Rejig Today - Shares of Adani Transmission, Adani Total Gas and Indus Towers will exit the MSCI Global Standard Index on May 31, 2023, as a part of the May rejig exercise. On the other hand, Max Healthcare Institute, Hindustan Aeronautics (HAL) and Sona BLW Precision Forgings will make an entry into the index.

 

·      Coal India - India's largest coal supplier Coal India has raisedprices of non-coking coal of grade G2 to G10 by 8% over the existing notified prices with effect from May 31, five years after the last hike. – positive.

 

·      TCS– Company secured a contract from Sweden-based Ikano Bank AB for its pan-Europe core banking transformation – positive

 

·      HDFC Life - Abrdn, formerly known as Standard Life, is likely to sell 1.6 percent equity stake or 3.57 crore shares in HDFC Life Insurance company via block deal today price range between Rs 563-585 per share (CMP 585). HDFC Bank, is set to acquire a 1.66% stake in HDFC Life from its UK-based joint venture partner –– We are positive on the HDFC Life – positive

 

·      Sona BLW - Promoter Aureus Investment Pvt Ltd plans to sell 3.25% stake or 1.9cr shares in Sona BLW Precision Forgings through a block deal today. The floor price for the sale is Rs500 a share, a discount of 7% to Tuesday’s closing price of Rs 535.50. – Good buying opportunity at lower level.

 

·      Govt may cut solar panel import tax from 40% to 20% to make up domestic shortfall - Rrenewable energy ministry has held talks with the finance ministry to approve its request to cut the import tax on solar panels from 40% to 20%, said the three sources – Expects positive for Tata Power

 

·      Infosys – Company and the French Tennis Federation (FFT) have revealed new innovations that will continue their partnership to transform and power the game in novel, smarter more immersive ways

 

·      Prestige Estates -  Company has made two strategic acquisitions to attain complete ownership of two key projects in central Mumbai’s Bandra-Kurla Complex (BKC) and South Mumbai’s Mahalaxmi locality by picking up balance stake from DB Group for a total consideration of over Rs 1,176 crore. Both the projects are currently under construction and are expected to be completed within the next 3- 4 years. – positive

 

·      ITC - The company revived its plan to carve out the hotels business as the sector has recovered from the pandemic's lows. The conglomerate was looking for an "alternative business structure" for its hotel business, ITC Chairman Sanjiv Puri said in an interview with Hindu BusinessLine. ITC's plans to spinoff its hotel businesses had been shelved since the pandemic. Recovery in its hotel business after the pandemic was the primary reason for the demerger proposal to be "back on the table", Puri said. - Positive

 

·      Vedanta -  Finsider International, a unit of Vedanta Ltd., pledges 4.4% of the latter's equity to Glencore International AG for a facility worth $250 million. The facility availed from Glencore will be operated by Vedanta Resources Ltd. Funds raised from Glencore will be used to refinance group debt – Positive

 

·      Sun Pharma- Sun Pharma, Philogen signed licensing agreement to sell Philogen’s specialty product, Nidlegy in Europe, Australia and New Zealand. The drug will be used to treat melanoma and non-melanoma skin cancers and is currently in Phase III clinical trials. – positive

 

·      RateGain's International - RateGain says international leisure flight bookings from India jumped to its highest post pandemic in June-August. RateGain Travel Technologies' latest report shows  international leisure flight bookings from India rose by 40% YoY in June-August 2023- its highest after pandemic. Demand remains 15-20% lower than pre-pandemic high of 2019 - positive

 

·      Torrent Pharma – Company approved rising Rs5000cr vis QIP and others  - positive

 

·      NDR Auto Componenet – Company announce bonus in the ratio of 1:1

 

·      Dividend – Astrazenacs Rs16, BCL Industries Rs5, La Opala Rs3, Goodyear India Rs26.50, Torrent Pharma Rs8

 

·      RattanIndia Enterprises – Company launched a new cargo drone ‘L-40’ by its company, Throttle Aerospace Systems The new L-40 drone has a higher payload capacity of 40 kgs as compared to the 20 kgs capacity L-20 drones – positive

 

·      Inox Wind- Company  bagged an order for a 150MW wind project from NTPC Green Energy's renewable arm. The project shall be executed in Gujarat. Inox Wind has recieved a total order of 550 MW from NTPC till date. – positive

 

·      Jyoti Ltd – Company bagged an order worth Rs6.21cr  from IOC for the design, engineering, manufacturing, testing and supply of 58 6.6-kilovolt and 11 KV vacuum circuit breaker panels.- Avoid due to poor balance sheet.

 

·      Force Motor announced strong Q4 results. Company reported Q4 Net Sales at Rs 1,490.15 crore in March 2023 up 69.07% from Rs. 881.38 crore in March 2022.  Net Profit at Rs. 149.16 crore in March 2023 up 473.09% from Rs. 39.98 crore in March 2022. EBITDA stands at Rs. 158.63 crore in March 2023 up 2015.07% from Rs. 7.50 crore in March 2022.

 

·      Mankans Pharma Q4 net profit Rs109.5cr (up 72% YoY) Ebitda margin 22.5% vs 15.2% (9YoY) and Income Rs486cr (up 16.5% YoY )

 

·      Adani Port Q4 -Income Rs5796.9cr (up 40% YoY), Ebitda Rs3271.3cr (up 24.8% YoY), Ebitda margin at 56.4% vs 62.3% (YoY) and Net profit Rs2292.4cr (up 42.6% YoY)

 

·      Munjal Showa Q4 net profit Rs21.2cr (up 202% YoY), Ebitda margin 5.5% vs 3% (YoY) , Ebitda Rs16.4cr (up 82.2% YoY)and Income Rs299cr (up 1% YoY )

 

·      Arvind Fashion Q4 net profit Rs28.5cr (up 27.2% YoY), Ebitda margin 11% vs 8% (YoY) , Ebitda Rs124cr (up 69.2% YoY)and Income 1140cr (up 24.4% YoY )

 

·      V-Guard better than expected Q4 Incoem and Ebitda inline with Bloomberg expectation. Company reported Q4 net profit Rs52.7cr (down 41.2%% YoY) – Bloomberg expectation Rs66.79cr, Ebitda margin 8.6% vs 10.6% (YoY) , Ebitda Rs98.6cr (down 12% YoY) – Bloomberg expectation Rs100cr, and Income 1140.1cr (up 7.6% YoY ) – Bloomberg expectation Rs1109cr

 

·      Suzlon Q4 Net profit Rs320cr vs loss Rs205.52cr (One time gain Rs251.5cr), operating margin 13.73% vs 4.26% (YoY), Ebitda Rs232.69cr (up nearly 100% YoY) and Income Rs1694cr (up 31.53% YoY)

 

·      Apollo Hospital announced marginally lower than expected Ebitda and Ebitda margin. Company reported Q4 net profit Rs146cr (up 50.50% YoY) – expectation Rs208.9cr, Ebitda margin 11.4% vs 13.1% (YoY) – Expectation 12% , Ebitda Rs488cr (up 5.4% YoY) – expectation Rs528cr and Income 4302.2cr (up 21.3% YoY ) – Expectation Rs4404cr

 

·      Torrent Pharma announced marginally lower than expected Ebitda and Income. Company reported Q4 net profit Rs287cr vs loss Rs118cr (YoY) – expectation Rs360cr, Ebitda Rs727cr (up 30% YoY) – expectation Rs774cr and Income Rs2490cr (up 17% YoY ) – Expectation Rs2495cr.  Domestic sales Rs1260cr (up 22% y/y) – Bloomberg estimate Rs1237cr and  US revenue Rs280cr (down 0.7% y/y) – Bloomberg estimate Rs292cr.