KEY HIGHLIGHTS
Closing Bell: A Strong Show
Indian equity markets held on to gains to end the weekly options expiry session on a strong note.
The S&P BSE Sensex ended 0.96% higher at 38,025 while the NSE Nifty 50 index closed 0.9% higher at 11,200.
Nifty I.T. was the top sectoral gainer in today's session, ending with gains of 2%.
Metal stocks outperformed yet again. The metal index gained for the fifth straight day today. Gains were led by Tata Steel, which also was the top performer on the Nifty 50 index, ending with gains of close to 4%. The index has now gained in eight out of the last nine trading sessions.
Other indices like FMCG, Pharma and Realty saw gains between 1 to 1.5% in today's session.
The PSU bank index was the only sectoral laggard, ending 0.3% lower.
Broader markets saw divergent trends today. The midcap index ended 1.3% higher while the smallcap index gained 0.3%.
India Volatility Index ended 1.8% lower at 23.14.
Market breadth ended in favour of the gainers. 1,120 stocks on the NSE ended with gains while 703 posted losses.
Contributors To Nifty's Gains
Buzzing Stock: Dilip Buildcon
- Among top performers on the Nifty Smallcap index
- Gains as much as 8.7% to Rs 342.9
- Trades at the highest level in nearly six months
- Up for the fourth straight day
- Longest winning streak in over a month
- Has gained 20% in the last four trading sessions
- Today's volumes are nearly triple its 20-day average
- Stock in overbought territory with Relative Strength Index (RSI) at 71
- Breaks above 200-Day Moving Average at 327.6 with high volumes
- Has gained 75% from its 52-week low of Rs 190 on March 25, 2020
- 12 out of the 14 analysts tracking the stock have a buy recommendation; 1 sell call
- Return potential of the stock as per Bloomberg data is 14.1%
RBI Allows Restructuring Of Loans
Also Read: RBI Permits One-Time Restructuring Of Loans
Tata Consumer Leads Gains On The FMCG Index
Earnings Reaction: Blue Star Q1FY21
- Revenue down 60% to Rs 626 crore
- Net loss of Rs 20 crore from net profit of Rs 75.4 crore
- Ebitda down 99% to Rs 1.5 crore
- Ebitda margin at 0.2% from 7.3%
- EMP projects and Commercial AC business revenue down 50% to Rs 312.4 crore
- Unitary products revenue down 70% to Rs 275 crore
- Most part of the summer season was lost and a majority of the project sites remained shut.
- Swift actions taken to reduce operating costs helped mitigate the adverse profitability impact
- Other income during the quarter was higher on account of receipt of an industrial promotion subsidy for the manufacturing facility at Wada
- Finance cost more than doubled due to additional borrowings and increased cost of funds
- Carried forward order book at Rs 2,919 crore
- Demand is expected to normalise by Q4FY21
- All numbers are consolidated and compared on a year-on-year basis
Shares ended 4.7% higher at Rs 506.3. The stock ended higher for the third straight day.
Earnings Reaction: BASF India Q1FY21
- Revenue up 10% to Rs 1,769 crore
- Net loss of Rs 29.1 crore from net profit of Rs 8.2 crore
- Ebitda down 92% at Rs 14.9 crore
- Ebitda margin at 0.8% from 5.1%
- Agricultural solutions revenue up 26% to Rs 439 crore
- Materials revenue down 60% to Rs 164.6 crore
- Industrial Solutions revenue down 22% to Rs 215 crore
- Surface Technologies revenue down 55% to Rs 91.5 crore
- Nutrition and care business more than doubles to Rs 535.7 crore
- Chemicals segment revenue nearly triples to Rs 297.6 crore
- All numbers are standalone and compared on a year-on-year basis
Shares ended 5.5% lower at Rs 1,337.9, down for the second straight day.
Active Stock Options
- Reliance Industries' 2,300 Call: Premium down 12.3% to 36. The contract has added 1.6 lakh shares in Open Interest.
- ICICI Bank's 360 Call: Premium down 7.1% to Rs 13.65. The contract has shed 1.2 lakh shares in Open Interest.
- Tata Steel's 400 Call: Premium up 20.8% to Rs 15.1. The contract has added 1.3 lakh shares in Open Interest.
Buzzing Stock: Prestige Estates
- Second best performing stock on the Nifty Realty index
- Gains as much as 9.1% to Rs 222.5 - currently off the day's high
- Trades at the highest level in over a month
- Up for the eighth straight day
- Longest winning streak since April 2012
- Has gained 24% in the last eight trading sessions
- Today's volumes are nearly triple its 20-day average
- Continues to trade above its 50-Day Moving Average of 193.5
- Has gained over 50% from its 52-week low of Rs 133.6 on May 19, 2020
- 18 out of the 19 analysts tracking the stock have a buy recommendation; 1 sell call
- Return potential of the stock as per Bloomberg data is 24.9%
Markets At 2:10 P.M.
- Benchmark indices hold gains post RBI policy
- Nifty up 0.95% at 11,207
- Sensex up 1% at 38,053
- Nifty Bank up 1.1% at 21,738
- Nifty Midcap index up 1%
- Nifty Smallcap index up 0.5%
- India Volatility Index down 1.4% to 23.23
- Nifty Auto pares losses, trades little changed
- Nifty Pharma remains top sectoral gainer; up 1.5%
- Nifty I.T., Nifty FMCG and Nifty Realty gain over 1% each
- GAIL remains the top Nifty gainer; up 2.8%
- Shree Cement is the top Nifty laggard; down 1.3%
- 1,145 stocks on the NSE trade with gains while 648 decline
Money Market Update
The currency has ended unchanged in today's session after the Monetary Policy Committee kept benchmark interest rates unchanged.
The rupee ended at 74.92 against the U.S. Dollar as compared to Wednesday's close of 74.94. This despite the U.S. Dollar weakening to levels lowest in nearly two years.
Despite the flat close, the rupee ended as the third best performer in Asia, behind the South Korean Won and the Philippine Peso.
Yield on the 10-year government bond ended at 5.806% as compared to Wednesday's close of 5.765%.
Earnings Reaction: Adani Power Q1FY21
- Revenue down 33% to Rs 5,203 crore
- Net loss widens to Rs 682.4 crore from Rs 264 crore
- Ebitda down 48% to Rs 1,388.5 crore
- Ebitda margin at 26.7% from 34.4%
- Transmission charges up 50% to Rs 149.5 crore
- Exceptional item of Rs 1,002 crore in the base quarter
- Average Plant Load Factor during the quarter at 51%
- PLF is lower due to decline in power demand following the nationwide lockdown
- Consolidated units sold during the quarter at 12.7 BU
- Depreciation and interest charges higher due to incorporation and consolidation of units
- All numbers are consolidated and compared on a year-on-year basis
Shares were off the day's low, ending little changed at Rs 35.20. The stock has declined in five out of the last six sessions.
Third Day Of Gains For The Nifty Bank
Earnings Reaction: Whirlpool Of India Q1FY21
- Revenue down 48% to Rs 1,027 crore
- Net profit down 85% to Rs 16.5 crore
- Ebitda down 85% to Rs 46.7 crore
- Ebitda margin at 4.5% from 15.3%
- All numbers are standalone and compared on a year-on-year basis
Shares are off the day's high, currently trading 0.4% higher at Rs 2,101 post the announcement.
Stock Reaction: Manappuram & Muthoot Finance
Shares of the cash-for-gold lenders rose after the Reserve Bank of India said that it will ease rules for advances against the yellow metal.
Governor Shaktikanta Das, during his policy address declared that the loan-to- limit for gold loans for non-agri purposes has been raised to 90% from 75% earlier.
The relaxation is available till March 31, 2021.
Shares of Manappuram Finance gained as much as 6.1% to Rs 169 and are up for the second straight day.
Shares of Muthoot Finance rose as much as 5.3% to Rs 1,324, post the announcement.
European Markets Open Lower
Markets across Europe have opened lower ahead of the rate decision from the Bank of England.
The Stoxx 600 has opened with losses of 0.4% with miners, real estate and banking stocks being the top laggards.
Most Asian markets have closed on a mixed note while futures on the Dow Jones are trading higher by 50 points.
Brent crude trades 0.2% higher at $45.26 per barrel while Gold scales yet another record high, up 0.64% at $2,051/Oz.
Let's take a look at how benchmark indices across Europe have opened:
- Euro Stoxx 50 down 0.3% at 3,257
- DAX unchanged at 12,656
- CAC down 0.5% at 4,909
- FTSE 100 down 1.1% at 6,039
- IBEX 35 down 0.6% at 6,995
How Are The Sectoral Indices Faring
Additional Liquidity For NABARD, NHB
Earnings Reaction: Adani Gas Q1FY21
- Revenue down 57.3% to Rs 197.2 crore
- Net profit down 68% to Rs 38.9 crore
- Ebitda down 53.9% to Rs 77.4 crore
- Ebitda margin at 39.2% from 36.3%
- Sales volumes at 64 mmscm from 145 mmscm
- 979 new PNG home connections during Q1FY21
- Commercial and industrial connections at 4,448
- Volumes impacted by 53% during the quarter due to Covid-19
- All numbers are consolidated and compared on a quarter-on-quarter basis
MPC Keeps Interest Rates Unchanged
Markets Ahead Of RBI Rate Decision
- Benchmark indices hold on to gains
- Nifty up 0.5% at 11,160
- Sensex up 0.5% at 37,854
- Nifty Bank unchanged at 21,496
- Nifty Midcap index up 0.6%
- Nifty Smallcap index up 0.5%
- India Volatility Index down 0.9% to 23.36
- Nifty Realty and Pharma are the top sectoral gainers; up 1.5% each
- Nifty FMCG, I.T. and Media index gain 1% each
- Nifty Auto remains the top sectoral laggard; down 0.4%
- GAIL is the top Nifty gainer; up 3.2%
- Axis Bank is the top Nifty laggard; down 1.1%
- 1,125 stocks on the NSE trade with gains while 608 decline
Buzzing Stock: Caplin Point Laboratories
- Trading at the highest level since March 2018
- Gains as much as 6.2% to Rs 608.2
- Up for the seventh straight session
- Longest winning streak since September 2018
- Has gained 53% in the last seven trading sessions
- Today's volumes are nearly quadruple its 20-day average
- Stock in overbought territory with Relative Strength Index (RSI) at 90
- Has more than tripled from its 52-week low of Rs 176.2 on March 24, 2020
- All three analysts tracking the stock have a buy recommendation
- The stock trades 12.4% above its 12-month consensus price target of Rs 529, implying a negative return potential
Earnings Reaction: Apollo Tyres Q1FY21
- Revenue down 33.7% to Rs 2,873.4 crore
- Net loss of Rs 134.6 crore from net profit of Rs 141.6 crore
- Ebitda down 50.1% to Rs 237.2 crore
- Ebitda margin at 8.26% from 11%
- All numbers are ahead of consensus estimates
- APMEA segment revenue down 42% to Rs 1,818 crore
- European segment revenue down 12% to Rs 1,090 crore
- Revenue from other segments down 60% to Rs 257.5 crore
- Numbers are consolidated and compared on a year-on-year basis
Shares fell as much as 4.2% to Rs 111, snapping a two-day gaining streak. The stock is now off the day's low.
Earnings Reaction: Inox Leisure Q1FY21
- Revenue down 99.9% to Rs 0.25 crore
- Net loss of Rs 73.6 crore from net profit of Rs 27 crore
- Ebitda down 77.7% to Rs 33.45 crore
- Group has invoked the force majeure clause under various lease agreements for its multiplex premises, contending that rent and CAM charges for the shutdown period on account of Covid-19 are not payable.
- The group has recognised Rs 69.3 crore towards reduction of such rentals and has also not recognised expenses of Rs 20.9 crore towards CAM charges.
- Board approves enabling resolution for fund raising up to Rs 250 crore through the issuance of equity shares or other methods.
- All numbers are consolidated and compared on a year-on-year basis
Shares gained as much as 2.2% to Rs 239.7, on the National Stock Exchange.
Bloomberg Exclusive: HDFC Bank's Delayed Reports Draw In RBI
One of India's biggest credit bureaus has informed the Reserve Bank of India in getting information from HDFC Bank, India's second largest lender by assets, Bloomberg News reports, citing people familiar with the matter.
The local unit of Experian told the RBI in July that the lender has been late in providing details of its loans, including the repayment status of millions of its retail borrowers, the sources said.
An HDFC Bank spokesperson denied any delays in supplying the information. "HDFC Bank has always been sharing information with the credit bureaus on time, both as a matter of policy and regulatory compliance," the spokesperson said.
The RBI did not respond to an e-mail by Bloomberg News seeking a comment on the story.
Shares of HDFC Bank are off the day's high, currently trading 0.9% higher at Rs 1,037.
Nifty Pharma Is The Top Sectoral Gainer
Stock Reaction: Federal Bank & IDBI Bank
The lender has entered into an agreement to purchase up to 4% stake in IDBI Federal Life Insurance from IDBI Bank.
The shares will be purchased at a price not exceeding Rs 27.56 per share. The transaction is subjective to regulatory approvals, the bank said in an exchange filing.
Federal Bank currently holds 26% stake in IDBI Federal Life, making it an associate of the bank.
Federal Bank's stake post the asset purchase will rise to 30%.
Shares of Federal Bank trade 0.3% lower at Rs 52.2.
Shares of IDBI Bank trade 1% higher at Rs 39.35 per share.
Stock Reaction: Steel Strips Wheels
The company has informed the exchanges that it has bagged export orders for over 6,000 wheels for the U.S. truck and Caravan trailer market.
The orders are worth $2.09 lakh and will be executed in August from its Chennai plant, the company said in an exchange filing.
Similar orders are expected in times to come from other regular customers as the market regains normalcy.
Shares gained as much as 2.8% to Rs 427.9, post the announcement. The stock is up for the third straight day.
Earnings Reaction: Birlasoft Q1FY21
- Revenue in U.S. Dollar terms down 3.4% to $121.2 million
- Revenue up 1% to Rs 914.6 crore
- Net profit down 18.4% to Rs 56.3 crore
- Ebitda down 3.3% to Rs 112.9 crore
- Ebitda margin at 12.3% from 12.9%
- Signed total contract deals of $179.7 million during the quarter
- Active client count at 356
- Added 1 new customer in the $10 million+ category
- Attrition down 520 basis points to 16.5%
- Days of Sales Outstanding at 60 days, down by 12 days
- All numbers are consolidated and compared on a quarter-on-quarter basis
Shares ended 14.7% higher - their biggest single-day gain since May 2012 at Rs 149.5. The stock ended at the highest level since September 2018.
Stock Reaction: NIIT
Shares of the training services company rose after Massachusetts Institute Of Technology acquired further stake in the company on Wednesday through large deals.
MIT acquired 30 lakh shares or 2.12% stake in the company at Rs 96.75 per share, as per data available on the exchanges.
As per the shareholding pattern for the quarter ending June, MIT had 1.87% stake in the company.
The current purchase raised its stake in NIIT Ltd. to 3.99%.
Shares gained as much as 5.7% to Rs 102 and are up for the second straight day. The stock trades at the highest level in five months.
Markets At 10:10 A.M.
- Benchmark indices hold on to gains
- Nifty up 0.6% at 11,162
- Sensex up 0.55% at 37,855
- Nifty Bank up 0.3% at 21,570
- Nifty Midcap index up 0.8%
- Nifty Smallcap index up 0.7%
- India Volatility Index little changed at 23.53
- Nifty I.T., Nifty Media and Nifty Realty gain between 1-1.5%
- Nifty Pharma is the other sectoral gainer; up 0.8%
- Nifty Auto is the only sectoral laggard; down 0.4%
- Zee Entertainment is the top Nifty gainer; up 4.4%
- Maruti Suzuki India is the top Nifty laggard; down 1.2%
- Top three Nifty laggards are auto stocks - Maruti, Eicher Motors, M&M
- 1,143 stocks on the NSE trade with gains while 496 decline
Money Market Update
The currency has opened with gains for the second straight day ahead of the monetary policy decision.
The rupee opened at 74.80 against the U.S. Dollar, as compared to Wednesday's close of 74.94.
Just over half of the 44 economists in a Bloomberg survey expect the MPC to cut interest rates in this policy.
Economists and analysts are divided over the prospective rate action from the MPC owing to a rebound in inflation.
Buzzing Stock: Hindustan Zinc
- Among top performers on the Nifty 500 index
- Trades at the highest level since July 2019
- Gains as much as 7.9% to Rs 236
- Up for the third straight day
- Has gained 13% in the last three trading sessions
- Today's volumes are more than eight times higher than its 20-day average
- The stock trades in overbought territory with Relative Strength Index (RSI) at 75
- Has doubled from its 52-week low of Rs 116 on March 13, 2020
- Brokerage firm Citi has raised the price target on the stock to Rs 240 from Rs 205, maintaining its buy rating. It expects a likely upside in its dividend yield which is currently at 8%. It has raised FY21-23 Ebitda estimates by 9-18%.
- 15 out of the 22 analysts tracking the stock have a buy recommendation; 1 sell call
- The stock trades 10.9% above its 12-month consensus price target of Rs 207.7, implying a negative return potential
Coronavirus India Update
- 14th straight day of cases above 50,000
- 56,282 new cases reported over the last 24 hours
- Total confirmed cases at 19,64,536
- Active cases now at 5,95,501
- Patients cured / discharged / migrated at 13,28,336
- Death toll rises to 40,699
- 904 deaths reported over the last 24 hours
- 46,121 patients recovered in the last 24 hours
Earnings Reaction: JK Lakshmi Cement Q1FY21
- Revenue down 20.8% to Rs 825.2 crore
- Net profit up 12.7% to Rs 44.4 crore
- Ebitda down 15.6% to Rs 143.4 crore
- Ebitda margin at 17.4% from 16.3%
- Exceptional loss of Rs 30 crore in the base quarter
- Lower power, fuel and freight costs aid margins
- Further enhancing its WHR power capacity by 10 MW, which is likely to be commissioned during the first half of FY22.
- All numbers are standalone and compared on a year-on-year basis
Shares fell as much as 6% to Rs 280, down for the second straight day.
Contributors To Nifty's Gains
Opening Bell: A Positive Start
Indian equity markets have opened higher ahead of the Monetary Policy announcement at noon.
The S&P BSE Sensex opened 0.75% higher at 37,946 while the NSE Nifty 50 index opened at 11,185, up 0.76%.
Banking stocks have opend higher. The Nifty Bank and the PSU Bank index have opened with gains of 0.6% each.
Among other sectoral indices, the media index has opened 0.7% higher while the Auto index is up half-a-percent.
Broader markets too opened higher with the midcap and smallcap index opening with gains of 0.5% each.
Market breadth was in favour of the gainers. 1,071 stocks on the NSE opened with gains while 347 declined.
Latest On The Coronavirus
- Global cases cross 18.6 million
- Death toll rises to 7.03 lakh
- Japan PM Shinzo Abe says the current outbreak does not call for an emergency declaration
- Victoria in Australia reported 725 new cases on Wednesday
- Overall cases in the U.S. rise 1.1%
- Positive-test rate in Texas climbs for fourth straight day. 8,706 new cases detected
- 202 deaths reported in California - the second worst day in terms of deaths
- Johnson and Johnson to supply 100 million doses of its experimental vaccine to the U.S.
Top Reads On BloombergQuint.com
How Did The Fund Flows Fare On Wednesday
Key Stocks In Focus
- HDFC: Launches QIP issue at a floor price of Rs 1,838.94 per share. The floor price is a 4% premium to Wednesday's closing. The company intends to raise Rs 14,000 crore through issue of equity and Rs 9,000 crore through NCDs. The board will meet on August 10 to consider the issue price for the sale. The company can offer a discount of not more than 5% on the floor price as per SEBI regulations
- Canara Bank: 22.7% loan book under moratorium post its Q1 results.
- National Fertilizers: Sales up 20% to 18.79 lakh MT while Urea sales up 17% to 15.87 lakh MT during the June quarter.
- Cera Sanitaryware: To discontinue the business operations of its Dubai arm. Expected date of closure is February 2021. This entity contributed 0.2% to the total turnover of the company.
- Alkem Laboratories: Launches Favipiravir under the brand name ‘Alfluenza.’
- Apollo Tyres: Board approved issue of NCDs worth Rs 1,000 crore. To issue convertible preference shares up to Rs 540 crore to Emerald Sage Investment.
- Welspun Enterprises: Can provisionally commence operations for four-laning of Chutmalpur-Ganeshpur section in Uttar Pradesh from August 5. The completion cost f this HAM project is over Rs 1,070 crore. The company is now entitled to receive annuity payment from the NHAI every six months, in accordance with provisions of the HAM concession.
- Non-Nifty Earnings Today: Lupin, Pidilite, HPCL, Vodafone Idea, Whirlpool, Adani Enterprises, Adani Power, Blue Star, Can Fin Homes, Dalmia Bharat, Deepak Nitrite, Jamna Auto, JK Tyre, KEI Industries, Indian Hotels.
To know more about the earnings reported after market hours and key brokerage updates, click here.
Your Trade Setup For The Day
A Check On Indian ADRs
Weekly Options Expiry Today
Good Morning!
The street will keep a close eye on the decision of the Monetary Policy Committee on Thursday, besides the weekly options expiry of the Nifty and Nifty Bank's contracts.
The metals space will continue to remain in focus. The index ended 4% higher on Wednesday, and has gained in seven of the last eight sessions.
The Singapore-traded SGX Nifty, an early indicator of the Nifty 50 Index’s performance in India, was little changed at 11,121 as of 8:10 a.m. on Thursday.
Canara Bank, Inox Leisure, Adani Gas, Birlasoft, DLF and JK Lakshmi Cement are among the few broader market companies that reported their quarterly earnings late Wednesday will be in focus. A few non-Nifty 50 stocks like Lupin, Hindustan Petroleum, Vodafone Idea, Pidilite, Whirlpool, Blue Star, Can Fin Homes and Deepak Nitrite are set to report their first-quarter results on Thursday.
Asian stocks are advancing for the fourth straight day this morning. Shares in Hong Kong and Japan edged higher, while those in South Korea are outperforming.
The U.S. dollar fell to its lowest in nearly two-years, while gold remains above the $2,000-mark.
Futures on the Dow Jones are trading higher by 70 points.
Short on time? Well, then listen to this podcast for a quick summary of All You Need To Know before the opening bell.
RECOMMENDED FOR YOU
POPULAR