KEY HIGHLIGHTS
Closing Bell: Gains For The Week
Indian equity markets had a rangebound session but managed to register gains for the week.
The S&P BSE Sensex ended little changed at 38,040 while the NSE Nifty 50 index ended 0.1% higher at 11,214.
Asian Paints emerged as the top gainer on the Nifty 50 index, ending with gains of 4.6% while Titan was the top Nifty laggard, ending 2.5% lower.
Among the sectoral indices, the PSU Bank index was the top performer in the session, ending with gains of 1%. Nifty FMCG and Nifty Auto gained over 0.5%. Metal index had yet another day of gains, ending higher for the sixth straight session with gains of 0.8%.
Broader markets outperformed for the day and for the week as well. The midcap index ended 1.2% higher today while the smallcap index gained 1.2%. Both indices were up over 4% for the week.
The India Volatility Index ended 3.3% lower at 22.37.
Market breadth ended in favour of the gainers. 1,165 stocks on the NSE traded with gains while 649 stocks declined.
Both benchmark indices registered gains of over 1% for the week.
Decoding The Markets This Week
Earnings Reaction: Adani Transmission Q1FY21
- Revenue down 14.4% to Rs 2,446.2 crore
- Net profit up 80% to Rs 383.6 crore
- Ebitda down 3.2% to Rs 1,156 crore
- Ebitda margin at 47.3% from 41.8%
- Higher other income and low cost of power aid numbers
- All numbers are consolidated and compared on a year-on-year basis
Shares gained as much as 9.7% to Rs 253.55, post the announcement. The stock is up for the second straight day.
Buzzing Stock: RBL Bank
- Best performing stock on the Nifty Midcap index
- Locked in an upper circuit of 10% at Rs 191.55
- Biggest single-day gain in two months
- Trades at the highest level in five months
- Today's volumes are more than double of its 20-day average
- Bounces from its 50-Day Moving Average of 168.7
- Has nearly doubled from its 52-week low of Rs 101.55 on April 22, 2020
- 18 out of the 30 analysts tracking the stock have a buy recommendation; 7 sell calls
- The stock trades around its 12-month price target of Rs 188.9
Metal Index Up In Four Out Of The Last Five Weeks
Stock Reaction: Tube Investments
The company has informed the exchanges that it has approved the proposal for making a binding bid to acquire controlling stake in CG power.
Tube investments will first make an initial investment of Rs 700 crore in CG Power to acquire controlling stake.
This will be done through a combination of primary subscription of equity shares for which it will invest around Rs 550 crore, primary subscription to warrants for an investment of Rs 150 crore.
The warrants referred will be convertible into equivalent number of equity shares within 18 months from the date of allotment.
Shares ended 6.1% higher at Rs 540.8, the highest level in five months. This was the biggest single-day gain for the stock in over two months.
Earnings Reaction: Alkem Laboratories Q1FY21
- Revenue up 8% to Rs 2,003 crore
- Net profit more than doubles to Rs 423 crore
- Ebitda doubles to Rs 533 crore
- Ebitda margin at 27% from 14%
- India sales down 5.5% to Rs 1,155 crore
- Decline was sharper in acute therapy areas of anti-infectives, gastro-intestinal among others as compared to chronic therapy areas
- International sales up 33% to Rs 785.3 crore
- U.S. sales up 38.3% to Rs 666.4 crore
Shares ended off the day's high but up 4% at Rs 2,981, which is an all-time closing high. The stock ended higher for the second day in a row.
Earnings Reaction: Mahanagar Gas Q1FY21
- Revenue down 62% to Rs 261.8 crore
- Net profit down 72.6% to Rs 45.3 crore
- Ebitda down 67.2% to Rs 80 crore
- Ebitda margin at 30.6% from 35.5%
- Total volumes down 60% to 1.11 mmscmd
- CNG volumes down 75.7% to 43.7 SCM million
- PNG volumes down 21.3% to 57.6 SCM million
Shares fell as much as 2.6% to Rs 959, post the announcement. The stock is down for the second straight day.
Earnings Reaction: Kajaria Ceramics Q1FY21
- Revenues down 60% to Rs 278 crore
- Net loss of Rs 27 crore from Net profit of Rs 51 crore
- EBITDA loss of Rs 8 crore from EBITDA gain of Rs 106.5 crore
- Collection during the quarter was strong
- Plants operated at 26% capacity utilisation during June
- Capacity utilisation in July has improved to 78%
- Sales down to 7.66 MSM from 19.65 MSM
Shares fell as much as 1.9% to Rs 406, post the announcement. The stock has snapped a two-day gaining streak.
Money Market Update
The rupee snapped a three-week gaining streak in today's session, posting marginal losses for the week.
The currency ended unchanged at 74.93 against the U.S. Dollar, which is the same level at which it ended on Thursday.
For today's session, the currency was the third best performer in Asia, ending behind the Philippine Peso and the Hong Kong Dollar.
On a weekly basis, the rupee was the second worst performing currency in Asia, behind the Indonesian Rupiah. The rupee fell 0.16% this week.
Yield on the 10-year government bond ended at 5.839% as compared to Thursday's close of 5.81%.
Earnings Reaction: Emami Q1FY21
- Revenue down 26% to Rs 481.3 crore
- Net profit up 1% to Rs 39.6 crore
- Ebitda down 9% to Rs 202.5 crore
- Ebitda margin at 42.1% from 34.2%
- Advertising and promotional expenses down 54% to Rs 59.7 crore
- Cost of materials consumed down 40% to Rs 97.8 crore
- Saw high single digit sales growth in June
- Healthcare and Hygiene portfolio sees growth of 29%
- Summer portfolio sees weakness in offtake, down 26% during the quarter
Shares ended 8% higher at Rs 257.3 - the highest level in five months.
Stock Reaction: TV Today Network
The company has informed the exchanges that it has decided to suspend the print publication of the English Daily newspaper 'Mail Today' from August 10, 2020.
TV Today has cited viability of the print media in the current situation as the reason behind the move. "The content shall continue to be published in the digital format," the company said in an exchange filing.
Mail today comprises of insignificant portion of the business of the company, the statement said. During the quarter ending June, the newspaper in its physical form contributed 2% to the company's total revenue.
Shares recovered from the day's low to gain as much as 2.7% to Rs 215. The stock is currently fluctuating between gains and losses.
Earnings Reaction: Mahindra & Mahindra Q1FY21
- Revenue down 57% to Rs 5,602 crore
- Net profit down 95% to Rs 112.1 crore
- Ebitda down 66% to Rs 549 crore
- Ebitda margin at 9.8% from 12.6%
- Automotive segment revenue down 75% to Rs 2,051 crore
- Farm Equipment segment revenue down 24% to Rs 3,340 crore
- Tractor segment showed positive growth in May and June
- Low pipeline inventory and challenges of ramping up production due to supply chain issues affected sales
- All numbers are standalone and compared on a year-on-year basis
Shares of Mahindra & Mahindra fell to the day's low, falling as much as 1.25% to Rs 602, post the announcement. This compares to the Nifty 50 index which is little changed.
Nifty I.T.: The Top Sectoral Laggard
European Stocks Open Flat
Benchmark indices opened lower in Europe as a tepid U.S. jobs report coupled with rising tensions between U.S. and China kept investors on the edge.
The Stoxx 600 index has opened 0.1% lower with miners and retail stocks leading the decline. Insurance and Utilities are outperforming.
Most Asian Markets have ended lower while futures on the Dow Jones are trading lower by 100 points.
Brent Crude is little changed at $45 per barrel while Gold is trading 0.3% lower at $2,057/Oz.
Let's take a look at how benchmark indices across Europe have opened:
- Euro Stoxx 50 up 0.1% at 3,244
- DAX up 0.2% at 12,617
- CAC down 0.1% at 4,879
- FTSE 100 unchanged at 6,028
- IBEX 35 down 0.3% at 6,939
How Are The Sectoral Indices Faring
Earnings Reaction: KEI Industries Q1FY21
- Revenue down 31.1% to Rs 745.3 crore
- Net profit down 21% to Rs 36.2 crore
- Ebitda down 36.6% to Rs 72.3 crore
- Ebitda margin at 9.7% from 10.6%
- Cables segment revenue down 24% to Rs 646.2 crore
- Stainless Steel Wire segment revenue down 34% to Rs 20.8 crore
- EPC Projects revenue down 56% to Rs 176.3 crore
- All numbers are standalone and compared on a year-on-year basis
Shares gained as much as 4.9% to Rs 371, snapping a two-day losing streak.
F&O Snapshot: Active Options Contracts
- Nifty August futures add 5.3% and 5.4 lakh shares in Open Interest.
- Nifty Bank August futures add 20% and 2.6 lakh shares in Open Interest.
Nifty: August 13 Expiry
- 11,200 Call: Premium up 1.4% to Rs 111.8. The contract has added 14 lakh shares in Open Interest.
- 11,300 Call: Premium up 4.7% to Rs 67.6. The contract has added 11.5 lakh shares in Open Interest.
- 11,100 Put: Premium down 9.2% to Rs 66.6. The contract has added 15.4 lakh shares in Open Interest.
Nifty Bank: August 13 Expiry
- 22,000 Call: Premium up 5% to Rs 239.7. The contract has added 3.75 lakh shares in Open Interest.
- 21,500 Put: Premium down 17.9% to Rs 263. The contract has added 2.85 lakh shares in Open Interest.
- 21,000 Put: Premium down 24% to Rs 115.9. The contract has added 2.4 lakh shares in Open Interest.
Buzzing Stock: Kaveri Seed
- Among the top performers on the Nifty Smallcap index
- Trading at the highest level since August 2017
- Gains as much as 7.7% to Rs 650
- Biggest single-day gain in two months
- Up for the second straight day
- Today's volumes are nearly quadruple its 20-day average
- Remains above its 50-Day Moving Average of 571.5
- Has more than doubled from its 52-week low of Rs 273.7 on March 24, 2020
- Seven out of the nine analysts tracking the stock have a buy recommendation; 0 sell calls
- Return potential of the stock as per Bloomberg data is 2.2%
Markets At Noon
- Benchmark indices remain rangebound
- Nifty down 0.16% at 11,179
- Sensex down 0.3% at 37,927
- Nifty Bank down 0.2% at 21,603
- Nifty Midcap index up 1.2%
- Nifty Smallcap index up 0.8%
- India Volatility Index down 0.7% at 23
- Nifty Auto is the top sectoral gainer; up 1%
- Nifty FMCG is the other sectoral gainer; up 0.7%
- Nifty I.T. is the top sectoral laggard; down 1%
- Asian Paints is the top Nifty gainer; up 2.1%
- HCL Technologies is the top Nifty laggard; down 2.7%
- 1,115 stocks on the NSE trade with gains while 616 decline
Earnings Reaction: Pidilite Q1FY21
- Revenue down 56.5% to Rs 877.8 crore
- Net profit down 91% to Rs 26.8 crore
- Ebitda down 85% to Rs 66.4 crore
- Ebitda margin at 7.5% from 22%
- Performance significantly impacted due to the lockdown
- Metros have been the most impacted
- Consumer and Bazaar businesses seeing swifter demand recovery
- Seeing strong recovery in construction chemicals and DIY products
- B2B business seeing a slower recovery
- Underlying sales volume and mix decline of 58.3%
Shares are trading at the day's high, gaining as much as 3.6% to Rs 1,380.5. The stock is up for the second straight day.
Buzzing Stock: Delta Corp
- Top performer on the Nifty Smallcap index
- Gains as much as 17.6% to Rs 115.8
- Biggest single-day gain since April 2017
- Trades at the highest level in five months
- Up for the fifth straight day
- Longest winning streak in over two months
- Has gained 29% in the last five trading sessions
- Today's volumes are 17 times higher than its 20-day average
- Trades above its 50-Day moving average at 91.3
- Has doubled from its 52-week low of Rs 53 on March 25, 2020
- All six analysts tracking the stock have a buy recommendation
- Return potential of the stock as per Bloomberg data is 36.5%
Earnings Reaction: Deepak Nitrite Q1FY21
- Revenue down 35.8% to Rs 674.5 crore
- Net profit down 24.8% to Rs 99 crore
- Ebitda down 28.5% to Rs 181.6 crore
- Ebitda margin at 26.9% from 24.2%
- Basic Chemicals revenue down 32% to Rs 152.9 crore
- Fine & Specialty Chemicals revenue up 21% to Rs 139.8 crore
- Performance Products revenue down 76% to Rs 54 crore
- Phenolic segment revenue down 34% to Rs 330.7 crore
- All numbers are consolidated and compared on a year-on-year basis
In addition to this, the company's arm Deepak Phenolics is expanding its capacity of production of lsopropyl Alcohol at its Dahej unit from 30,000 to to 60,000 tons per annum.
Investment cost will be Rs 50 crore and the new capacity is expected to be commissioned in the first quarter of FY22.
Shares fell as much as 11.4% - the most in five months to Rs 569.75. Shares are off the day's low but continue to trade with losses. The stock is also the worst performer on the Nifty Smallcap Index.
Fourth Day Of Gains For The Auto Index
Earnings Reaction: Torrent Power Q1FY21
- Revenue down 20% to Rs 3,007 crore
- Net profit up 35% to Rs 372 crore
- Ebitda up 16% to Rs 969.4 crore
- Ebitda Margins at 32.2% from 22.3%
- Electrical Energy purchased down 48% to Rs 682.3 crore
- Fuel cost down 26% to Rs 922.4 crore
- Decrease in interest cost mainly due to repayment of loans and reduction in interest rates
- Performance of franchised distribution business has been impacted due to Covid-19 led to increase in T&D loss
- All numbers are consolidated and compared on a year-on-year basis
Shares gained as much as 9.1% - the most since June 2019 to Rs 357.7. The stock trades at the highest level since July 2010 and is the top performer on the Nifty Midcap index.
Buzzing Stock: Trent
- Second best performer on the Nifty Midcap index
- Gains as much as 7.1% to Rs 597.8
- Biggest single-day gain in nearly two months
- Up for the second straight day
- Set to snap a three-week losing streak
- Today's volumes are 87% higher than its 20-day average
- Breaks above its 50-Day Moving Average of 586.2
- Has gained 62% from its 52-week low of Rs 365 on March 24, 2020
- 9 out of the 15 analysts tracking the stock have a buy recommendation; 1 sell call
- The stock trades 7.7% above its 12-month consensus price target of Rs 534.4, implying a negative return potential
Earnings Reaction: Bayer CropSciences Q1FY21
- Revenue up 29% to Rs 1,227 crore
- Net profit up 86% to Rs 251 crore
- Ebitda up 61% to Rs 324.4 crore
- Ebitda margin at 26.4% from 21.3%
Brokerage firm Antique stock broking maintained its buy rating on the stock and raised its price target to Rs 6,810 from the earlier Rs 6,120.
It has cited Bayer's merger with Monsanto India to reap benefits and be positive in the long-term.
Shares gained as much as 14.5% to an all-time high of Rs 6,450.
Lupin Leads The Losses On The Pharma Index
Earnings Reaction: Lupin Q1FY21
- Revenue down 9% to Rs 3,527.9 crore
- Net profit down 52% to Rs 181 crore
- Ebitda down 34.6% to Rs 488.1 crore
- Ebitda margin at 13.8% from 19.2%
- North America business revenue down 21.1% to Rs 1,216 crore
- India business revenue down 1.7% to Rs 1,285 crore
- Growth markets revenue down 5.8% to Rs 270 crore
- EMEA revenue down 4% to Rs 250 crore
- Rest of the World revenue down 46% to Rs 38.3 crore
- API revenue up 17% to Rs 409 crore
- R&D expense at 10.3% of sales at Rs 357.5 crore.
- Performance in key markets like India and U.S. impacted due to the lockdown.
- Tight expense control helped margins
- Expect momentum to continue on margin improvement
Shares fell as much as 6.2% to Rs 877.80.
New Listing: Mindspace Business Parks REIT
Mindspace Business Parks listed its units on the bourses at Rs 302 per unit - a 9.8% premium to its issue price of Rs 275 per share.
The company's Rs 4,500 crore IPO was subscribed 13 times on the final day of bidding.
Institutional subscription stood at 10.65 times while the retail portion was subscribed 10.65 times.
Money Market Update
The currency has opened with losses in today's session after ending unchanged on Thursday.
The rupee opened at 75.06 against the U.S. Dollar as compared to Thursday's close of 74.93.
Traders will look forward to weekly data on forex and bank credit released by the Reserve Bank of India.
Within the bond markets, traders will focus on the sale of Rs 30,000 crore in government bonds.
The RBI's decision to allow banks to consider Mutual Fund holdings as equivalent to debt in terms of capital charge for market risks can aid bonds, according to Murthy Nagarajan of Tata Mutual Fund.
Coronavirus India Updates
- India reports largest spike in new Covid-19 cases
- India now has 2 million confirmed Covid-19 cases
- 62,538 new cases reported over the last 24 hours
- First instance of over 60,000 new cases been reported in India
- Active cases now at 6,07,384
- Patients cured / discharged / migrated at 13,78,105
- Death toll rises to 41,585
- 886 deaths reported over the last 24 hours
- 49,769 patients recovered in the last 24 hours
Stock Reaction: Steel Strips Wheels
The company has informed the exchanges of securing export orders for close to 20,000 wheels for the Caravan Trailer Market in the European Union.
The order is d at 1.38 lakh Euros, according to the company's exchange filing.
The order will be executed from the company's Chennai plant in the month of September.
Shares gained as much as 2% to Rs 431.65, post the announcement.
Stock Reaction: Prince Pipes & Fittings
The company has announced a technical collaboration with Tooling Holland - a plastic mould manufacturing company.
The association will strengthen the company's technical competence and enhance operational efficiencies, as per the exchange filing.
"This alliance provides great impetus to our growth plans and our firm commitment to build and offer superior products, aligned to global standards and at competitive costs," Prince Pipes' Executive Director Parag Chheda said post the announcement.
Shares gained as much as 14.8% - the most on record to Rs 140.5. The stock trades at the highest level in five months and is up for the fifth straight day.
Earnings Reaction: Vodafone Idea Q1FY21
- Revenue down 9.3% to Rs 10,659.3 crore
- Net loss widens to Rs 25,640 crore from Rs 11,643.5 crore
- Ebitda down 6.4% to Rs 4,098.4 crore
- Ebitda margin at 38.4% from 37.3%
- ARPU at Rs 114 from Rs 121
- Exceptional loss of Rs 19,923.2 crore due to additional charges made on AGR dues
- Company in a statement said that networth has turned negative
- All numbers are consolidated and compared on a quarter-on-quarter basis
Brokerage firm CLSA has maintained its underperform rating on the stock and has cut its price target to Rs 8.4 from the earlier Rs 9.2.
The firm expects upside potential for the company's ARPU but has cited the AGR dues burden as 'enormous.'
Shares fell as much as 7.9% to Rs 7.6, down for the fourth straight day. The stock has recovered from the day's low.
Opening Bell: A Subdued Start
Indian equity markets opened flat but with a negative bias on the final trading day of the week.
The S&P BSE Sensex opened 0.2% lower at 37,591 while the NSE Nifty 50 index opened little changed at 11,186.
As of closing on Thursday, both benchmark indices were up 1% on a weekly basis.
All sectoral indices have opened flat. The Realty index has opened 0.7% higher while the Metal index has opened 0.4% lower. The index has gained in eight out of the last nine trading sessions.
Broader markets have opened flat but with minor gains. The midcap index is up 0.3% while the smallcap index has gained 0.1% at the start of trade.
Market breadth is in favour of the gainers. 935 stocks on the NSE opened with gains while 455 declined.
Latest On The Coronavirus
- Global cases cross 19 million
- Death toll rises to 7.13 lakh
- Mexico reported 6,590 new cases with 819 deaths
- U.S state department issues advisory to not travel to Mexico
- Philippines has the worst Covid-19 outbreak in South-East Asia
- 53,139 new cases reported in Brazil
- Cases in Africa cross the 1 million mark
- Total cases in the U.S. rise 1.3%; death toll at 1,59,433
- 1,604 new cases reported in France - levels last seen in April
How Did The Fund Flows Fare On Thursday
Key Stocks In Focus
- Lupin: Signs an exclusive distribution pact with Fordoz Pharma for exclusive rights to market and distribute two complex injectable assets. The assets - in the oncology and anti-infective therapeutic areas are in advanced stages of development in the U.S. and its territories.
- Jubilant FoodWorks: Announces foray into the FMCG space with a range of ready-to-cook sauces, gravies and pastes. The company has launched eight products across Indian & Chinese cuisines and will be initially available for consumers across e-commerce platforms. It plans to expand the product availability by adding more e-commerce platforms as well as retailing through supermarkets and hypermarkets going ahead.
- Welspun Corp: Board approves the listing of Welspun Middle East Pipes on the local exchanges of Saudi Arabia. The process of listing will involve divestment of a maximum 15% stake of WMEPL held by Welspun Corp through its overseas subsidiary. The total consideration will be $30 million along with proportionate shares to be divested by local partners. Post the proposed listing, the company's share in WEMPL will fall below 35% from the existing 50%.
- Deepak Nitrite: Arm Deepak Phenolics is expanding its capacity of production of lsopropyl Alcohol at its Dahej unit from 30,000 to to 60,000 tons per annum. Investment cost will be Rs 50 crore and the new capacity is expected to be commissioned in the first quarter of FY22.
- Minda Industries: Board to meet on August 11 to discuss details about the rights issue. The board had approved raising Rs 250 crore by way of rights issue on June 20.
- Alembic Pharma: Board closed the QIP issue at a price of Rs 932 per share, which was at a discount of 4.97% to the floor price and discount of 14% to the closing price on Thursday.
- Nifty Earnings Today: Cipla, Mahindra & Mahindra
- Non-Nifty Earnings Today: Abbott India, Amara Raja Batteries, Amber Enterprises, Balrampur Chini, Bata, BEML, CONCOR, Emami, ENIL, MGL, REC, Shipping Corporation, Siemens, Sobha, Ramco Cements
To know more about earnings reported after market hours, brokerage views and the F&O setup, click here.
Your Trade Setup For The Day
A Check On Indian ADRs
A Topsy Turvy Week So Far
Good Morning!
Today is the final session of a volatile week for Indian markets. The benchmarks have swung between gains and losses through the last four trades.
The S&P BSE Sensex and the NSE Nifty 50 have risen 1% each so far this week.
The Singapore-traded SGX Nifty, an early indicator of the Nifty 50 Index’s performance in India, fell 0.13% to 11,198 as of 8:00 a.m. on Friday.
Some Non-Nifty 50 companies like Lupin, Pidilite, Hindustan Petroleum Corp., Vodafone Idea, Adani Enterprises and Novartis, among others, will remain in focus as they reported their quarterly earnings post market hours on Thursday
Nifty 50 companies Cipla and Mahindra & Mahindra are set to announce their numbers on Friday. Broader market companies such as Amara Raja Batteries, Amber Enterprise, Balrampur Chini, Bata India, BEML, Emami, Container Corporation, REC and Sobha will also announce their results.
Asian markets are mixed in today's trading session. Markets in China and Japan are lower, while those in South Korea edge higher.
Futures on the Dow Jones are trading 50 points lower. Gold extended gains amid speculations that interest rates may remain lower for longer. The U.S. dollar was on course for its sixth straight weekly loss.
Short on time? Well, then listen to this podcast for a quick summary of All You Need To Know before the opening bell.
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