KEY HIGHLIGHTS
Closing Bell: A Subdued Session
Indian equity markets ended off the highest point of the day, ending a rangebound session on a flat note.
The S&P BSE Sensex ended 0.2% at 38,614 while the NSE Nifty 50 index ended 0.3% higher at 11,419. This was the third straight day of gains for the benchmark indices.
Among the sectoral indices, the Nifty Media index ended as the top performer with gains of 5.4%, courtesy a 14% surge in Zee Entertainment.
The Nifty PSU Bank (up 2.4%) and Nifty Realty (up 1.3%) were the other sectoral gainers.
Nifty FMCG (down 0.4%), Nifty I.T. (down 0.3%) and Nifty Pharma (down 0.4%) were the sectoral laggards in today's session. The Nifty Pharma ended lower for the third straight session and has now declined in six out of the last seven trading sessions.
Broader markets outperformed in today's session with the midcap index ending 0.6% higher while the smallcap index ended with gains of 1.24%.
The India Volatility Index ended 2.7% lower, below the mark of 20 at 19.88. This was the lowest closing level for the index in six months.
Market breadth remained in favour of the gainers. 1,217 stocks on the NSE ended with gains while 612 declined.
How Have The Sectoral Indices Performed
Buzzing Stock: Tata Chemicals
- Gains as much as 5.8% to Rs 313.3
- Biggest single-day gain in four months
- Trades at the highest level in two months
- Up for the second straight day
- Today's volumes are quadruple than its 20-day average
- Breaks above its 200-Day Moving Average of 294.6
- Has recovered 57.6% from its 52-week low of Rs 197
- Five out of the 10 analysts tracking the stock have a buy recommendation; 2 sell calls
- Return potential of the stock as per Bloomberg data is 1%
Earnings Reaction: Muthoot Finance Q1FY21
- Revenue up 29% to Rs 2,385 crore
- Net Interest Income up 24.6% to Rs 1,513.6 crore.
- Net profit up 58% to Rs 840
- Gain on fair change at Rs 58 crore from Rs 9 crore
Shares are off the day's high, trading 2% higher at Rs 1,263. The stock is up for the fifth straight day.
Active Stock Options
- Reliance Industries' 2,200 Call: Premium up 10.4% to Rs 40.75. The contract has shed 30 shares in Open Interest.
- Maruti's 7,000 Call: Premium up 20.4% to Rs 114. The contract has added 102 shares in Open Interest.
- Bajaj Finance's 3,500 Call: Premium down 26% to Rs 56.95. The contract has added 366 shares in Open Interest.
Earnings Reaction: Asian Granito Q1FY21
- Revenue down 59% to Rs 129.4 crore
- Net loss of Rs 7.4 crore from net profit of Rs 11.3 crore
- Ebitda down 89% at Rs 3.7 crore
- Ebitda margin at 2.9% from 11%
- All numbers are consolidated and compared on a year-on-year basis
Shares gained as much as 5.4% to Rs 241, before cooling off. The stock is up for the fourth straight day.
Stock Reaction: Zee Entertainment
The Bombay High Court has dismissed Yes Bank's interim application against the company.
The lender wanted to enfore as a guarantee, a letter of comfort extended by Zee Entertainment in support of its Mauritian subsidiary.
The bank had sought an order preventing Zee Entertainment from disposing or transferring its assets.
The court found no merit in the argument and dismissed the bank's plea.
Shares ended 14% higher at Rs 198.4 - the biggest single-day gain in four months.
Stock Reaction: Strides Pharma Sciences
The company today announced the successful completion of the inspection carried out by the U.K. Medicines and Healthcare products Regulatory Agency (MHRA) of its Puducherry facility between October 15-18, 2019.
The drugmaker received the renewed GMP (Good Manufacturing Practices) certificate, confirming the successful closure of the inspection, according to its exchange filing.
We stay focused on getting the facility reclassified with the U.S.FDA. We are committed to upholding the highest levels of quality compliance and integrity across all our manufacturing sites.R Ananthanarayanan, MD & CEO, Strides Pharma
Shares gained as much as 3.2% to Rs 587.5, post the announcement.
Markets At 2:10 P.M.
- Benchmark indices remain in a range
- Nifty up 0.5% at 11,442
- Sensex up 0.55% at 38,718
- Nifty Bank up 0.84% at 22,357
- Nifty Midcap index up 0.8%
- Nifty Smallcap index up 1.5%
- India Volatiltiy Index down 2.22% at 19.98
- Nifty Media remains the top sectoral gainer; up 3.9%
- Nifty PSU Bank is the other major sectoral gainer; up 3%
- Nifty FMCG, Nifty I.T. give up gains and trade with a negative bias
- Zee Entertainment is the top Nifty gainer; up 8.6%
- Nestle India is the top Nifty laggard; down 1.1%
- 1,264 stocks on the NSE trade with gains while 524 decline
Money Market Update
The rupee ended snapped a two-day gaining streak in today's session after posting modest losses.
The currency ended at 74.82 against the U.S. Dollar as compared to Tuesday's close of 74.76.
The opening level of 74.68 was the intra-day high for the local currency while it recovered from an intra-day low of 74.92.
Today's performance made rupee the second worst performing currency in Asia after the Thai Baht.
Yield on the 10-year government bond ended at 5.969% as compared to Tuesday's close of 5.958%.
Earnings Reaction: CSB Bank Q1FY21
- Net Interest Income up 40% to Rs 185.3 crore
- Net profit nearly triples to Rs 53.5 crore
- Gross NPA at 3.51% from 3.54% last quarter
- Net NPA at 1.74% from 1.91% last quarter
- Provisions for NPAs at Rs 13.76 crore from Rs 56 crore last quarter
- Overall provisions at Rs 57.5 crore from Rs 84.3 crore last quarter
- Provisions worth Rs 31.3 crore this quarter for Covid-19
- Overall Covid-19 provisions currently at Rs 44.21 crore
Shares ended 13% higher at Rs 225.05 - the highest level since December 2019.
Buzzing Stock: NCC
- Gains as much as 7.5% to Rs 35.8
- Biggest single-day gain in two-months
- Trades at the highest level in over five months
- Up for the fifth straight day
- Longest winning streak in four months
- Has gained 13% in the last five trading sessions
- Today's volumes are 12% higher than its 20-day average
- Trading near its 200-Day Moving Average at 38.4
- Has more than doubled from its 52-week low of Rs 15.85 on March 30, 2020
- 16 out of the 18 analysts tracking the stock have a buy recommendation; 1 sell call
- Return potential of the stock as per Bloomberg data is 38.7%
Third Day Of Gains For The Realty Index
L&T Finance Said To Weigh $450 Million Rights Issue
L&T Finance Holdings is exploring a plan to raise around $450 million through a rights issue, people familiar with the matter told Bloomberg.
The Financial services arm of Larsen & Toubro has started discussions with potential advisors regarding the fundraising, sources said.
The company's parent - Larsen & Toubro has agreed that it will buy any unsold shares in the offering.
No final decision has been made regarding the amount to be raised or the timing of the share sale and the company can still decide not to proceed with the fundraising plan.
Shares are off the day's high after gaining as much as 1.9% to Rs 68.5 and are up for the third straight day.
European Markets Open Lower
Benchmark indices in Europe opened with declines with major indices trading near key trendlines.
The Stoxx 600 index has opened 0.3% lower. Utilities and oil & gas stocks are the top laggards. Food & Beverage stocks are outperforming.
Asian markets have ended mixed while futures on the Dow Jones are little changed.
Brent Crude is trading 0.9% lower at $45.07 per barrel while Gold trades 1% lower at $1,983/Oz.
Let's take a look at how benchmark indices across Europe have opened:
- Euro Stoxx 50 down 0.3% at 3,279
- DAX down 0.3% at 12,848
- CAC down 0.3% at 4,925
- FTSE 100 down 0.33% at 6,057
- IBEX 35 down 0.4% at 7,014
How Are The Sectoral Indices Faring
Buzzing Stock: NALCO
- Top gainer on the Nifty Metal index
- Gains as much as 8.3% to Rs 39.2
- Biggest single-day gain in five months
- Trades at the highest level in six months
- Gains for the third straight day
- Today's volumes are more than quadruple its 20-day average
- Stock in overbought territory with Relative Strength Index (RSI) at 75
- Breaks above its 200-Day Moving Average at 36.5
- Has recovered 62.5% from its 52-week low of Rs 24.4 on March 13, 2020
- Five out of the nine analysts tracking the stock have a buy recommendation; 3 sell calls
- The stock trades at its 12-month consensus price target of Rs 38.3
Stock Reaction: Centum Electronics
The company announced the divestment of the energy division of its subsidiary in France.
The Centum Adetel Group (CAG) will sell its energy unit for a total consideration of 9.8 million Euros to Chauntie Electric (Tianjin), according to the company's exchange filing.
65% of the total consideration has already been received by the subsidiary while the balance payment will be made after a transition period of two years.
Shares gained as much as 12.2% - the most in two months to Rs 393.25 - the highest level in over six months. The stock has snapped a three-day losing streak.
Inox Leisure, PVR Lead Gains On The Media Index
Markets At Noon
- Benchmark indices remain in a narrow range
- Nifty up 0.4% at 11,434
- Sensex up 0.5% at 38,705
- Nifty Bank up 0.8% at 22,348
- Nifty Midcap Index up 0.8%
- Nifty Smallcap Index up 1.3%
- India Volatility Index down 1.3% to 20
- Nifty PSU Bank and Nifty Media remain the top sectoral gainers; up nearly 2.5% each
- Nifty Realty is the other major sectoral gainer; up 1.4%
- Nifty Metal, Nifty I.T. give up gains to trade flat
- GAIL remains the top Nifty gainer; up 4%
- Tata Steel is the top Nifty laggard; down 0.9%
- 1,224 stocks on the NSE trade with gains while 534 decline
Buzzing Stock: Atul
- Trades at an all-time high
- Among top performers on the Nifty 500 index
- Gains as much as 7.5% to Rs 5,675
- Biggest single-day gain in five months
- Up for the third straight day
- Today's volumes are 54% below its 20-day average
- Stock trades in overbought territory with Relative Strength Index (RSI) at 73
- Has nearly doubled from its 52-week low of Rs 2,923 on March 25, 2020
- Five out of the nine analysts tracking the stock have a buy recommendation; 2 sell calls
- The stock trades 3.7% higher than its 12-month consensus price target of Rs 5,274, implying a negative return potential
Stock Reaction: Dixon Technologies
The company will hold a board meeting on Friday, August 21 to consider and approve raising funds.
The fund raising can be done by way of issuance of any instrument or security including equity shares, fully or partly convertible debentures, foreign currency convertible bonds, warrants or any other combination thereof, the company said in its exchange filing.
The fund raising can be done in one or more tranches by way of a public issue, preferential allotment, private placement or any other method thereof.
Shares gained as much as 2.7% to Rs 8,095 and are up for the second straight day.
Stock Reaction: Yes Bank
The private lender in its annual report said that it has repaid Rs 35,000 crore to the Reserve Bank of India under the special liquidity facility. The bank had borrowed Rs 50,000 crore from the regulator.
The bank had earlier repaid Rs 25,000 crore in July, it said while announcing its June quarter results.
The bank's non-executive chairman Sunil Mehta said that the balance amount will be repaid within the timelines set by the central bank.
In the first quarter of the current financial year, Yes Bank also saw an improvement in its deposit base. Total deposits rose 11.4% quarter-on-quarter to Rs 1.17 lakh crore at the end of June.
Shares are locked in an upper circuit of 5% for the second straight day at Rs 15.8.
Buzzing Stock: Shriram City Union Finance
- Second best performer on the Nifty 500 index
- Gains as much as 13.7% to Rs 999.85
- Biggest single-day gain since June 2019
- Trading at the highest level in five months
- Up for the seventh straight day
- Longest winning streak since March 2019
- Has gained in 10 out of the last 12 trading sessions
- Up 50% in the last seven trading session
- Today's volumes are more than five times higher than its 20-day average
- Stock trades in overbought territory with Relative Strength Index (RSI) at 90
- Has gained 60% from its 52-week low of Rs 625 on May 27, 2020
- 10 out of the 17 analysts tracking the stock have a buy recommendation
- The stock trades 10.3% higher than its 12-month consensus price target of Rs 873.2, implying a negative return potential
Stock Reaction: Dilip Buildcon
The company has informed the exchanges that its Joint Venture with HCC has received a Letter of Acceptance (LoA) for a new project in Uttarakhand.
The project, worth Rs 1,334 crore involves construction of tunnels, bridges, yard and formation works between Rishikesh and Karanprayag, according to the company's exchange filing.
The 7.955 kilometer long project is expected to be completed over the next 50 months as oer the company's statement.
Shares gained as much as 4.2% to Rs 396 and are up for the third straight day.
PSU Bank Index Is The Top Sectoral Gainer
Buzzing Stock: Jindal Saw
- Gains as much as 8% to Rs 70
- Trades at the highest level in over five months
- Up for the third straight day
- Has risen 17% in the last three trading sessions
- Today's volumes are more than triple its 20-day average
- Breaks above 200-Day Moving Average at 67.9
- Stock in overbought territory with Relative Strength Index (RSI) at 71
- The stock has nearly doubled from its 52-week low of Rs 39.8 on March 30, 2020
- Two out of the three analysts tracking the stock have a buy recommendation; 1 sell call
- The stock trades 41.6% higher than its 12-month consensus price target of Rs 40, implying a negative return potential
Stock Reaction: Embassy Office Parks REIT & Indiabulls Real Estate
The board of Indiabulls Real Estate approved the merger of two Embassy Group entities with itself.
The proposed amalgamation is for NAM Estates and NAM Opco into the company.
Proposed Swap Ratio: 6.619 shares of Indiabulls Real Estates for every 10 shares of NAM Estates and 5.406 shares of Indiabulls Real Estates for every 10 shares of NAM Opco.
The deal s Indiabulls Real Estate at Rs 92.25 per share, a 26% premium to Tuesday's closing price.
The amalgamation procedure expected to be completed by the second quarter of FY22.
Shares of Indiabulls Real Estate fell as much as 4.2% to Rs 70.50 while units of Embassy Office Parks REIT are unchanged after gaining as much as 1.1% to Rs 373.8.
Buzzing Stock: Century Textiles
- Second best performer on the Nifty Smallcap index
- Gains as much as 8.75% to Rs 343.7
- Biggest single-day gain in five months
- Trades at the highest level in four months
- Up for the third straight day
- Has gained 10% in the last three sessions
- Today's volumes are nine times higher than its 20-day average
- Again rebounds from 50-Day Moving Average support of 308.2
- Has gained 57% from its 52-week low of Rs 218.6 on March 25, 2020
- Return potential of the stock as per Bloomberg data is 28.3%
Earnings Reaction: Zee Entertainment Q1FY21
- Revenue down 35% to Rs 1,312 crore
- Net profit down 94% to Rs 29.2 crore
- Ebitda down 85% to Rs 108 crore
- Ebitda margin at 8% from 36%
- Advertising revenue down 65% to Rs 421 crore
- Subscription revenue up 5% to Rs 744 crore
- Rise in subscription revenue led mainly by Zee5
- Fair loss pertaining to group's overseas investments in mutual fund amounting to Rs 112 crore recognised during the quarter
Management Commentary:
- Will deliver more than 50% profit to free cash flow conversion from FY22
- FY21 will see significant reduction of working capital and movie buying
- Receivables will reduce in the coming quarters
- Margins will go back to 30% or more in FY22
- Expect ad-revenue to grow starting Q3FY21
Brokerage Commentary:
- CLSA: Buy rating maintained with price target of Rs 255. Stock offers deep at 10x PE for FY22CL.
- BofA Securities: Underperform rating maintained with price target of Rs 138. Execution and governance key for re-rating.
Shares gained as much as 5.2% to Rs 183. The stock trades at the highest level in two months and is up for the third straight day.
Markets At 10:10 A.M.
- Benchmark indices gain for third straight day
- Nifty up 0.4% at 11,430
- Sensex up 0.4% at 38,679
- Nifty Bank up 0.7% at 22,323
- Nifty Midcap index up 0.8%
- Nifty Smallcap index up 1%
- India Volatility Index up 1.4% to 20.1
- Nifty PSU Bank remains the top sectoral gainer; up 2.3%
- Nifty Media is the other major sectoral gainer; up 1.8%
- Nifty Auto, Nifty Realty up 0.9% each
- GAIL is the top Nifty gainer; up 3.5%
- HCL Technologies is the top Nifty laggard; down 1.2%
- 1,209 stocks on the NSE trade with gains while 472 decline
Money Market Update
The currency opened with gains in today's session after gaining for the second straight day on Tuesday.
The rupee opened at 74.68 against the U.S. Dollar as compared to Tuesday's close of 74.76.
The currency was the third best performer in Asia on Tuesday.'
The U.S. Dollar fell to its lowest in two years. "Dollar momentum will be the main driver of Emerging Market forex in the near-term," Maximillian Lin of Natwest Markets said.
Earnings Reaction: Uflex Q1FY21
- Revenue up 1% to Rs 1,992.7 crore
- Net profit up 2.2 times to Rs 196.5 crore
- Ebitda up 52.1% to Rs 416.3 crore
- Ebitda margin at 20.9% from 13.8%
- Lower raw material and power costs along with employee expenses aid margin expansion
- Production volumes up 13.4% to 1.07 lakh MT
- Total sales volumes up 9% to 1.03 lakh MT
- Demand for pouching saw a huge increase led by the personal hygiene category.
- Steady improvement in BOPP-BOPET price spread in the last one year and expect margins to remain healthy in the medium-term.
- All numbers are consolidated and compared on a year-on-year basis
Shares gained as much as 9.3% - the biggest single-day gain in four months to Rs 368.35. The stock trades at the highest level since April 2018.
Coronavirus India Updates
- First instance of more than 60,000 recoveries in a single day
- 64,531 new cases reported in the last 24 hours
- Total confirmed cases now at 27,67,273
- Active cases at 6,76,514
- Patients cured / discharged / migrated at 20,37,870
- Death toll rises to 52,889
- 1,092 deaths reported in the last 24 hours
- 60,091 patients recovered in the last 24 hours
Stock Reaction: IRB Infra
The company has informed the exchanges that it has received a unanimous Arbitral award of Rs 73.86 crore for one of its earlier projects in Punjab.
Shares of the company gained as much as 12.8% - the biggest single-day gain in two months to Rs 134. The stock is trading at the highest level since May 2019.
Stock Reaction: Reliance Industries
The company's subsidiary Reliance Retail Ventures has acquired equity shares of Vitalic Health and its subsidiaries for a cash consideration of Rs 620 crore.
Vitalics and its subsidiaries are in the business of pharma distribution and sales and its subsidiary also runs an online pharmacy platform called Netmeds, according to an exchange filing.
The investment represents 60% holding in equity share capital of Vitalic and direct 100% ownership of its subsidiaries - Tresara Health, Netmeds Marketplace and Dadha Pharma Distribution.
Reliance Retail will further acquire equity stake in Vitalic through a mix of secondary purchases and primary investment, for at least 80% stake by April 2024, with an option to increase the ownership to 100%.
Shares gained as much as 1.6% to Rs 2,151 and are up for the second straight day.
Opening Bell: Third Day Of Gains
Indian equity markets opened higher for the third straight day, despite mixed global cues as action in specific stocks remains in focus.
The S&P BSE Sensex opened 0.5% higher at 38,727 while the NSE Nifty 50 index opened 0.6% higher at 11,452.
All sectoral indices have opened with gains. The PSU Bank index has opened with gains of 1.2% while Pharma, Media, Auto and Nifty Bank have opened with gains of over 0.5%.
Broader markets have opened higher as well. The Nifty Midcap index has opened 0.6% higher while the smallcap index has opened with gains of 0.9%.
Market breadth was in favour of the gainers. 1,180 stocks on the NSE opened with gains while 311 declined.
Latest On The Coronavirus
- Global cases cross 22 million
- Death toll rises to 7.79 lakh
- U.S., Brazil, India account for more than half of the total global cases.
- Trump says Beijing's handling of the virus was unthinkable.
- Thailand may extend state of emergency until September
- South Korea reports 297 new cases - the most since March
- At least 20% of Brazil's meat plant workers are infected.
- Overall cases in the U.S. rise 0.8%
- California reports 4,636 new cases, below the 14-day average
How Did The Fund Flows Fare On Tuesday
Key Stocks In Focus
- Indiabulls Real Estate: Board has approved merger of two Embassy Group entities with self. Proposed amalgamation is for NAM Estates and NAM Opco into the company. Proposed swap ratio to be 6.619 shares of Indiabulls Real Estates for every 10 shares of NAM Estates and 5.406 shares of Indiabulls Real Estates for every 10 shares of NAM Opco. Indiabulls Real Estate is d at Rs 92.5 per share, which is at a premium of 26% to Tuesday’s closing prices.
- Phoenix Mills: Looks to raise as much as Rs 1,100 crore through a sale of shares. Indicative price of Rs 605 per share is a 6.5% discount to Tuesday's closing price. Floor price is Rs 611.3 per share which is a 5.4% discount to Tuesday's closing.
- Reliance Industries: Reliance Retail acquires majority stake in digital pharma market place Netmeds for a cash consideration of nearly Rs 620 crore.
- Yes Bank: Repaid additional Rs 10,000 crore owed to the Reserve Bank of India under the special liquidity facility. The Bank had borrowed Rs 50,000 crore under the special liquidity facility.
- IRB Infra: Gets arbitral award worth Rs 73.86 crore for one of its earlier projects in Punjab.
- Emami: Bombay High Court has temporarily restrained the company from using the mark ‘Glow and Handsome’ till further orders. Hindustan Unilever is prima facie, a prior adopter of the mark, according to the court.
- Zee Entertainment: Subhash Chandra appointed Chairman Emeritus. Ro Gopalan appointed chairman of the board with immediate effect. Approved proposal to sell 100% stake in its four wholly-owned arms - Zee Digital Convergence, Zee Unimedia, Zee Network Distribution and India Web Portal.
- Dixon Tech: To consider raising funds via debt / equity on August 21.
- NIIT: Nippon India Mutual Fund increased stake to 7.38% from 6.55% on August 14.
- Non-Nifty Earnings Today: Muthoot Finance, Asian Granito, Balmer Lawrie, CSB Bank, Globus Spirits, Ruchi Soya, V2 Retail
To know more about earnings reported after market hours, key brokerage updates and other trading cues, click here.
Your Trade Setup For The Day
A Check On Indian ADRs
Third Day Of Gains?
Good Morning!
India's benchmark indices closed at a five-month high on Tuesday, driven by a 550-points rally in the Nifty Bank Index.
The bank stocks gauge has gained in nine of the last 12 trading sessions.
But futures are indicating a tepid start to mid-week trade. The Singapore-traded SGX Nifty, an early indicator of the Nifty 50 Index’s performance in India, rose 0.2% to 11,433 as of 8:00 a.m. on Wednesday.
The street will watch out for stocks like Zee Entertainment, Hindustan Aeronautics and Uflex that announced their quarterly results after market hours on Tuesday. Muthoot Finance, CSB Bank, V2 Retail, Balmer Lawrie and Ruchi Soya are some of the companies that are set to declare their financials today.
Globally, markets in South Korea are rebounding from Tuesday's fall, while those in Japan are flat. Chinese markets are declining after the Trump administration warned the U.S. colleges to divest them.
The U.S. dollar fell to its lowest level in two years, while treasuries edged higher.
West Texas Intermediate crude fell 0.4% to $42.71 per barrel, while gold was little changed at $1,999.35/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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