KEY HIGHLIGHTS
Closing Bell: A Subdued Session
Indian equity markets ended the weekly options expiry session little changed, having stayed in a narrow range throughout the day.
The S&P BSE Sensex ended 0.2% lower at 38,990 while the NSE Nifty 50 ended almost unchanged at 11,527.
Banks were the major underperformers in today's session. The Nifty Bank index ended 1.2% lower and was the key contributor in keeping the Nifty's move in check.
I.T. and Pharma stocks outperformed. The Nifty I.T. inde ended 1.5% higher while the Nifty Pharma index ended with gains of 1%.
The Nifty FMCG and Nifty Auto index too ended with gains of 0.7% and 0.8% respectively.
Broader markets also outperformed the benchmarks in today's session. The Midcap index ended with gains of 0.9% while the smallcap index gained 0.7%.
The India Volatility Index fell 2.7% to 20.53.
Market breadth stayed in favour of the gainers. 1,023 stocks on the NSE ended with gains while 790 stocks posted losses.
How Did The Sectoral Indices Fare
Vodafone Idea Plans $1.5 Billion Fundraise
Vodafone Idea is planning to raise about $1.5 billion as it seeks to turn around its fortunes in the telecom market, Bloomberg News report.
The company is discussing a funding plan that can include a share sale, according to sources, who asked not to be identified. It is working with advisers, including New York-based investment bank PJT Partners as it seeks potential strategic partners to buy stakes in the company, sources said.
The sources also added that the telecom operator is working to identify potential investors in the U.S.
Shares gained as much as 30% to Rs 12.85.
Stock Reaction: Strides Pharma
The drugmaker has announced that its step-down wholly-owned subsidiary Strides Pharma Global Pte. Ltd., Singapore has received an approval for Prednisone Tablets USP, 1 mg.
The product is a generic version of Meticorten Tablets, 1 mg of Schering Corporation.
As per IQVIA data of July 2020, the U.S. market for Prednisone Tablets USP, 1 mg is nearly $12 million.
The product will be manufactured at the company's flagship facility in Bengaluru.
Shares are recovering from the day's low after falling as much as 1.9% to Rs 600.3, post the announcement.
Buzzing Stock: Bharti Infratel
- Top gainer on the Nifty 50 index
- Gains as much as 12.3% to Rs 220.2
- Biggest single-day gain in six months
- Trades at the highest level in two months
- Up for the second straight day
- Today's volumes are more than five times higher than its 20-day average
- Breaks above its 200-Day Moving Average of 213.5
- Has gained more than 80% from its 52-week low of Rs 120 on March 19, 2020
- 17% out of the 2.9 crore shares traded on the stock are marked for delivery as of 2 p.m.
- 11 out of the 23 analysts tracking the stock have a buy recommendation; six sell calls
- The stock trades 5.2% higher than its 12-month consensus price target of Rs 207.7, implying a negative return potential
RBI Buys Lesser Bonds Than Planned
The Reserve Bank of India bought bonds worth Rs 7,1300 crore as compared to its plan of purchasing bonds worth Rs 10,000 crore, Bloomberg News reports.
The central bank did not buy 2025 and 2027 bonds at the special open-market-bond-purchase operation or OMO, the statement said.
The RBI however managed to sell bonds worth Rs 10,000 crore, as per planned.
The central bank plans to hold another two operation twists totalling to Rs 20,000 crore on September 10 and September 17, as part of the slew of measures it announced on August 25.
Nifty Bank Near Day's Low
Active Stock Options
- TCS' 2,300 Call: Premium up 30.1% to Rs 70.5. The contract has shed 401 shares in Open Interest.
- Tata Motors' 160 Call: Premium up 19.2% to Rs 7.15. The contract has added 367 shares in Open Interest.
- ICICI Bank's 400 Call: Premium down 19.9% to Rs 11.5. The contract has added 1,327 shares in Open Interest.
Buzzing Stock: Vodafone Idea
- Top gainer on the Nifty Midcap index
- Biggest single-day gain in three months
- Gains as much as 19.7% to Rs 11.85
- Trades at the highest level in two months
- Up for the second straight day
- Has gained 33% in the last two trading sessions
- Today's volumes are nearly triple its 20-day average
- Broke above its 50-Day Moving Average of 9.1 on Wednesday
- Stock nearing overbought territory with Relative Strength Index (RSI) at 69.5
- Two out of the 20 analysts tracking the stock have a buy recommendation; 12 sell calls
- The stock trades 39% higher than its 12-month consensus price target of Rs 7.1, implying a negative return potential
Markets At 2:10 P.M.
- Benchmark indices continue to remain flat
- Nifty up 0.1% at 11,547
- Sensex unchanged at 39,081
- Nifty Bank down 0.7% at 23,701
- Nifty Midcap index up 0.8%
- Nifty Smallcap index up 0.95%
- India Volatility Index down 3.1% to 20.45
- Nifty I.T. is now the top sectoral gainer; up 1.5%
- Nifty Media, Nifty Auto and Nifty Pharma index up over 1% each
- Nifty Metal and Nifty PSU Bank index fall over 0.5% each
- Bharti Infratel remains the top Nifty gainer; up 9.5%
- ICICI Bank along with Bharti Airtel are the top Nifty laggards; down 1.9% each
- 1,058 stocks on the NSE are trading with gains while 709 decline
Money Market Update
The rupee ended lower for the second straight day, witnessing its biggest single-day drop in four months.
The currency ended at 73.48 against the U.S. Dollar as compared to Wednesday's close of 73.03.
With this decline, the rupee has given up all the gains it made during Tuesday's session.
The rupee also ended as Asia's worst performing currency in today's session.
Yield on the 10-year government bond ended at 5.884% as compared to Wednesday's close of 5.919%.
Stock Reaction: Tata Power
The company has informed the exchanges that its Strategic Engineering Division has signed the Pinaka 3 contract with the Ministry of Defence.
The Pinaka Multi-barrel Launcher Rocket System is an all-weather indirect fire artillery rocket system.
The contract, worth Rs 490 crore is for two regiments of the system.
The contract has to be executed within 31 months after bulk production clearance has been accorded, the statement said. The First off Production Model (FOPM) has a timeline of six months from the signing of the contract.
Shares recovered from the day's low to gain as much as 1.1% to Rs 61.6, post the announcement. The stock is up for the third straight day.
Third Day Of Gains For The Pharma Index
Stock Reaction: Vinati Organics
The company informed the exchanges that as part of its growth and expansion plan, it is envisaging a capex of about Rs 150 crore.
The capex will be aimed at manufacturing four new speciality chemicals and for expanding the present capacity of the PTBBA.
The new products will be used in sectors like agrochemicals, dyes and plastic additives, the company said in the exchange filing.
The capex is expected to derive additional revenue of close to Rs 240 crore and is likely to be completed during FY21, the statement said.
The stock currently trades little changed at Rs 1,009.
Earnings Reaction: Page Industries Q1FY21
- Revenue down 66% to Rs 2,848 crore
- Net loss of Rs 39.55 crore from net profit of Rs 110.6 crore
- Ebitda loss of Rs 560.3 crore from Ebitda gain of Rs 1,666.3 crore
- Deferred tax credit of Rs 12.8 crore this quarter as compared to tax expense of Rs 59.1 crore in the base quarter
- All numbers are compared on a year-on-year basis
Management Commentary: Page Industries
- Quarter saw full impact of Covid-19 lockdowns
- As of now, 80% of multi-brand outlets, 96% of EBOs and 90% of large format stores are fully functional
- Cash and cash equivalents rose 56% to Rs 173.4 crore due to efficient working capital management.
- Increasing trend of sales with greater demand in e-commerce and athleisure product category.
- E-commerce business has seen significant growth and continues to remain strong.
- Continue to remain confident of the medium-term given the strong business model, product portfolio and healthy balance sheet.
Shares ended 2.8% lower at Rs 19,140, post the announcement.
European Markets Open Higher
Markets in Europe bucked the trend across Asia and sluggishness in the U.S. futures to open higher for the second straight day.
The Stoxx 600 has opened 0.7% higher with all sectors advancing. Travel and Leisure along with technology stocks are the top gainers at the start of trade.
Asian markets have ended mixed while futures on the Dow Jones are trading little changed.
Brent crude trades 0.7% lower at $44.14 while Gold trades at $1,931.7/Oz, down 0.6%.
Let's take a look at how benchmarks across Europe have opened:
- Euro Stoxx 50 up 1.1% at 3,376
- DAX up 1% at 13,375
- CAC up 1.2% at 5,093
- FTSE 100 up 0.7% at 5,982
- IBEX 35 up 1.25% at 7,086
How Are The Sectoral Indices Faring
Buzzing Stock: Jamna Auto
- Among top performers on the Nifty 500 index
- Gains as much as 9.8% to Rs 46
- Biggest single-day gain in three weeks
- Trades at the highest level in over seven months
- Up for the third straight day
- Has gained 13% in the last three trading sessions
- Today's volumes are 53% below its 20-day average
- Has doubled from its 52-week low of Rs 21 on March 24, 2020
- Two out of the five analysts tracking the stock have a buy recommendation; 2 sell calls
- The stock trades 33.3% higher than its 12-month consensus price target of Rs 30.2, implying a negative return potential
Stock Reaction: Dr Reddy's Laboratories
The drugmaker has announced the launch of Methylphenidate Hydrochloride Extended-release tablets in the U.S. Market.
The tablets are being launched in the 18 mg, 27 mg, 36 mg and 54 mg, the company said in an exchange filing.
The drug is a generic version of Concerta extended release tablets.
The Concerta brand and generic market had sales of nearly $1.1 billion for the 12-months ending June 2020, according to IQVIA.
Shares gained as much as 2% to Rs 4,439, post the announcement. The stock is up for the third straight day.
Stock Reaction: Gateway Distriparks
The company's Board of Directors at a meeting held today have approved various structures for streamlining the business.
The businesses are currently being carried out by different group entities like Gateway Rail Freight Ltd. and Gateway East India Pvt. Ltd., the company said in an exchange filing.
The company has approved evaluating options to undertake an internal group restructuring including but not limited to mergers, reverse mergers and demergers.
The statement said that any proposed restructuring option will be subject to prior approvals.
Shares gained as much as 14.6% to Rs 108.2 - its highest level in nearly six months. The stock is up for the third straight day.
Markets At Noon
- Benchmark indices continue to fluctuate between gains and losses
- Nifty unchanged at 11,531
- Sensex down 0.1% at 39,028
- Nifty Bank down 1% at 23,638
- Nifty Midcap index up 0.6%
- Nifty Smallcap index up 1.1%
- India Volatility Index down 2.44% to 20.59
- Nifty Media is the top sectoral gainer; up 1.5%
- Nifty I.T., Nifty Auto are the other major sectoral gainers; up 1% each
- Nifty Metal and Nifty PSU Bank decline over 0.5% each
- Bharti Infratel remains the top Nifty gainer; up 7%
- ICICI Bank remains the top Nifty laggard; down 2.3%
- 1,072 stocks on the NSE trade with gains while 620 stocks decline
August Sales Performance: Jindal Steel & Power
- Consolidated steel sales - including pig iron, up 38% to 9.36 lakh tonnes
- Standalone steel sales up 37% to 6.82 lakh tonnes
- Consolidated steel production up 21% to 8.25 lakh tonnes
- Standalone steel production up 18% to 6.25 lakh tonnes
- Exports contributed 42% to the total sales volumes
- Barbil Pellet plant achieved best ever production of 7 lakh pellets
- World's first coal gasification-based DRI plant at Angul recorded highest ever gas-based DRI production with over 72% of rated capacity
- Working towards goal of reducing overall debt to Rs 15,000 crore by 2023
- Target is to achieve a turnover of Rs 50,000 crore by 2023
- Comparisons made on a year-on-year basis
Shares are off the day's high, currently trading little changed at Rs 221.6.
Stock Reaction: Engineers India
The company informed the exchanges that it has won an order from GAIL India to execute a PDH/PP project at Usar in Maharashtra.
The project involves setting up of a PDH and PP plant at Usar and a pipeline from Usar to Uran with storage facilities in Uran.
The project is d at Rs 448 crore and is supposed to be completed over the next 48 months.
Shares gained as much as 3.7% to Rs 68.45 and are up for the second straight day.
Second Day Of Gains For The I.T. Index
Stock Reaction: Cadila Healthcare
The company has informed the exchanges that it has received the final approval from the U.S. FDA to market Midodrine Hydrochloride tablets.
The drug is used in certain patients who have symptoms of low blood pressure when standing - a condition known as orthostatic hypotension.
The drug will be manufactured at the group's formulations manufacturing facility at SEZ, Ahmedabad, the exchange filing said.
Shares gained as much as 1.4% to Rs 387.4, post the announcement. The stock is up for the third straight day.
Buzzing Stock: Tata Consumer Products
- Trades at an all-time high
- Second best performer on the Nifty Midcap index
- Gains as much as 4.5% to Rs 574.9
- Biggest single-day gain in almost a month
- Up for the third straight day
- Today's volumes are 76% higher than its 20-day average
- Stock in overbought territory with Relative Strength Index (RSI) at 78
- Trades at 55.6 times estimated forward earnings per share as compared to its two-year historical average of 31.6 times
- Has more than doubled from its 52-week low of Rs 213.7 on March 24, 2020
- 12 out of the 13 analysts tracking the stock have a buy recommendation
- The stock trades 11.1% higher than its 12-month consensus price target of Rs 506.5, implying a negative return potential
Stock Reaction: Power Mech Projects
The company has informed the exchanges that it has received letter of intent for orders worth Rs 1,311.7 crore.
Two out of the seven orders won are to be executed by a Joint Venture between the company and SRC Infra in a 60-40 and 74-26 ratio respectively, the company said in a statement.
The company has also won two orders worth Rs 67 crore from the Rail Vikas Nigam.
Shares gained as much as 9.5% - the most in over two months to Rs 476.7, post the announcement. The stock is up for the second straight day.
Stock Reaction: Edelweiss
Ontario Teachers' Pension Plan Board - Canada's largest profession pension plan, announced that it has signed an agreement with Edelweiss Alternate Asset Advisors on Wednesday.
The partnership will invest Rs 2,600 crore and focus on performing and distressed private credit investment opportunities in the Indian market.
Edelweiss Alternate Asset Advisors is the largest private debt manager in India.
"We believe, the opportunity for Alternative Investment funds in India is large, given the need for credit, and we are confident that this partnership will enable Ontario Teachers’ to capitalize on the best of private debt opportunities available in India," Venkat Ramaswamy of the Edelweiss Group said in a statement.
Shares gained as much as 5% to Rs 81.3, snapping a three-day losing streak.
August Services PMI At 46
The services Purchasing Managers Index for the month of August rose to 46 as compared to 37.2 in July.
When compared on a year-on-year basis, the index stood at 52.6 during the same period last year.
This is the highest reading for the index since March this year, according to IHS Markit. However, the sector remains in contraction for the fifth straight month.
A reading below 50 indicates a contraction while that above 50 indicates expansion.
New orders saw their sixth straight month of contraction. However, that index rose to 45.4 in August from 37.8 in July. This was the highest reading since March 2020.
Earnings Reaction: Coal India Q1FY21
- Revenue down 25.9% to Rs 18,486.8 crore
- Net profit down 55.1% to Rs 2,079.6 crore
- Ebitda down 53.8% to Rs 3,051.8 crore
- Ebitda margin at 16.5% from 26.5%
- Volumes impacted due to lower demand from power sector due to Covid-19
- Offtake at 120.4 MT from 153.49 MT
- Lower taxes and other expenses cushion fall in net profit
- FSA sales at Rs 13,896 crore while realisation per tonne at Rs 1,359.5
- E-Auction sales at Rs 2,535.4 crore while realisation per tonne at Rs 1,598.1
- All numbers are consolidated and compared on a year-on-year basis
Shares fell as much as 1% to Rs 134.85 post the announcement. Brokerage firm Macquarie has maintained its neutral rating on the stock with a price target of Rs 139.
Stock Reaction: Intellect Design Arena
Samba Financial Group - one of the largest financial services group in the middle east has selected the company's global transaction banking platform - iGTB's digital banking solutions.
The deal enables the company to expand its footprint in the Kingdom of Saudi Arabia, the exchange filing said.
The company will help Samba power its digital transformation initiatives to strengthen its corporate offering and help attract more customers.
Shares are locked in an upper circuit of 5% at Rs 195.3, snapping a three-day losing streak.
Markets At 10:10 A.M.
- Benchmark indices trade in a range
- Nifty up 0.3% at 11,564
- Sensex up 0.15% at 39,145
- Nifty Bank down 0.4% at 23,787
- Nifty Midcap index up 0.7%
- Nifty Smallcap index up 1.1%
- India Volatility Index down 1.9% at 20.7
- Nifty I.T. is the top sectoral gainer; up 1.9%
- Nifty Auto and Nifty Media index up 1% each
- Nifty Metal and Nifty PSU bank decline 0.4% each
- Bharti Infratel is the top Nifty gainer; up 4.7%
- ICICI Bank is the top Nifty laggard; down 1.5%
- 1,106 stocks on the NSE trade with gains while 500 decline
Money Market Update
The currency opened with losses in today's session, after ending lower on Wednesday as well.
The rupee opened at 73.21 against the U.S. Dollar as compared to Wednesday's close of 73.03.
Yield on the 10-year government bond opened at 5.897% as compared to Wednesday's close of 5.942%.
Bond market traders will await more cues from the Services PMI data which will be reported at 10:30 a.m. this morning.
Auto Sales Reaction: Tata Motors
- Total domestic and international market sales up 13.3% to 36,472 vehicles.
- Domestic sales up 21.6% to 35,420 vehicles
- Total CV sales down 28% to 17,889 vehicles
- CV exports down 65.2% to 1,052 vehicles
- Domestic CV sales down 23% to 16,837 vehicles
- Passenger Carrier sales down 68% to 720 vehicles
- M&HCV sales down 48.6% to 2,746 vehicles
- I & LCV sales down 36.5% to 2,001 vehicles
- Total PV sales up 154% to 18,583 vehicles
- Comparisons made on a year-on-year basis
Shares gained as much as 2.5% to Rs 154 and are trading at the highest level in over six months. The stock is up for the fourth straight day.
Coronavirus India Update
- India reports record spike in Covid-19 cases
- 83,883 new cases reported in the last 24 hours
- Total confirmed cases now at 38,53,406
- Active cases now at 8,15,538
- Total patients cured / discharged / migrated at 29,70,492
- Death toll rises to 67,376
- 1,043 deaths reported in the last 24 hours
- 68,584 patients recovered in the last 24 hours
Earnings Reaction: Dish TV Q1FY21
- Revenue down 9.8% to Rs 835.6 crore
- Net profit at Rs 75.9 crore from net loss of Rs 32 crore
- Ebitda up 2.9% at Rs 551.4 crore
- Ebitda margin at 66% from 57.9%
- Lower operating costs and other expenses aid margin expansion
- Subscription revenue down 4% to Rs 791.5 crore
- Ebitda margins were at an all-time high
- Revenue impacted due to higher overall churn
- Total debt now at Rs 1,474.2 crore, down from Rs 1,817.5 crore
- All numbers are consolidated and compared on a year-on-year basis
Shares are locked in an upper circuit of 5% at Rs 11.45 and are up for the second straight day.
Stock Reaction: Aviation Stocks
Shares of Interglobe Aviation Ltd. and SpiceJet Ltd. have opened higher after the Ministry of Civil Aviation decided to increase capacity of domestic flights to 60% from the current levels of 45%.
The decision was taken after a review of scheduled domestic operations viz-a-viz passenger demand for air travel, the ministry said in a note on its website.
The change in capacity has already taken effect while the other terms and conditions prescribed by the ministry for domestic air travel remain the same.
Shares of Interglobe Aviation gained as much as 4.7% to Rs 1,306 and are up for the fourth straight day. The stock trades at the highest level in six months.
Shares of Spicejet gained as much as 5.6% to Rs 53.7 and are rising for the second straight day.
Opening Bell: A Sedate Start
Indian equity markets opened the weekly options expiry session with modest gains after a late recovery on Wednesday led the second straight day of gains.
The S&P BSE Sensex opened 0.2% higher at 39,165 while the NSE Nifty 50 index opened above the mark of 11,550 - up 0.3% at 11,566.
All sectoral indices opened with gains. The Nifty Bank and Nifty Auto index opened with gains of 0.7% each while the PSU Bank index opened 0.8% higher.
The Nifty FMCG and I.T. indices were up 0.4% each as was the Nifty Pharma index, which rose by a similar quantum.
Broader markets too have opened higher. The Nifty midcap index gained 0.6% at the start of trade while the smallcap index gained 0.7%.
Market breadth was in favour of the gainers. 962 stocks on the NSE trade with gains while 289 stocks decline.
Latest On The Coronavirus
- Global cases cross 25.8 million
- Death toll rises to 8.59 lakh
- Victoria warns that a premature reopening can cause infections to spike. The state reported 113 new virus cases in the last 24 hours.
- South Korea reported 195 new cases in the last 24 hours - the least since August 14
- Overall cases in the U.S. rise 0.5%
- Texas reports 4,149 virus patients as of late Tuesday
- 7,017 new cases reported in France
- Spain reports 3,663 new cases in the last 24 hours
How Did The Fund Flows Fare On Wednesday
Key Stocks In Focus
- IndusInd Bank: To allot 4.76 crore shares aggregating to Rs 2,495.8 crore on a preferential basis to qualified institutional buyers. Key investors in the issue include Route One Fund, ICICI Prudential, Tata Investment Corporation and AIA. The allotment price of Rs 524 per share is an 18% discount to Wednesday's closing.
- Tata Motors: Total sales in domestic and international market up 13.3% to 36,472 vehicles. Domestic sales up 21.6% to 35,420 vehicles. CV sales down 28% while PV sales up 154% year-on-year to 18,583 vehicles.
- Vedanta: Arrives at book of Rs 89.38 for its equity shares.
- Edelweiss Financial Services: Ontario Teachers’ Pension Plan Board has signed an agreement with Edelweiss Alternate Asset Advisors - the largest private debt manager in India for an investment of Rs 2,600 crore . The agreement represents a long‐term partnership between Ontario Teachers’ and Edelweiss Group that will focus on performing and distressed private credit investment opportunities in the Indian market.
- Engineers India: Received project contract from GAIL for setting up PDH / PP plant and pipeline at Uran for Rs 448 crore.
- VIP Industries: Sold its land and building of its Haridwar Factory for Rs 25-30 crore to Fresh Pet on ‘as-is-where is’ basis. The operations at the said Haridwar factory have been suspended since March 2020 due to Covid-19.
- Rossari Biotech: Plutus Wealth Management acquired 3 lakh shares or 0.58% stake at Rs 773.82 per share.
- Non-Nifty Earnings Today: Jubilant Industries, MSTC, Page Industries, Panacea Biotech, Zuari Agro Chemicals
To know more about the other stocks in focus, key brokerage updates and F&O cues, click here.
Your Trade Setup For The Day
A Check On Indian ADRs
Weekly Options Expiry Session
Good Morning!
India's equity benchmarks gained for the second straight day, led by a 400-points recovery in the Nifty Bank, ahead of the weekly options expiry. The weekly options of the futures and options contracts of Nifty and Nifty Bank will expire on Thursday.
Futures, however, are indicating a flat start to today's session. The Singapore-traded SGX Nifty, an early indicator of the Nifty 50 Index’s performance in India, is little changed at 11,580 as of 8:00 a.m.
Stocks like Coal India and Dish TV will be in focus as they reported their quarterly earnings after market hours on Wednesday. Page Industries, Jubilant Industries and Panecea Biotech, among others, are set to declare their results today.
Markets in Japan have pared early gains, while those in South Korea are outperforming. Futures on the Dow Jones are trading flat. The index had ended 1.6% higher on Wednesday.
West Texas Intermediate crude was little changed at $41.56 per barrel, while gold was flat at $1,942.1/Oz.
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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