Stocks Radar: Bank of India, TCS, Bata India, Future Consumer
Indian equity benchmarks rose after swinging between gains and losses in opening trade, weighed down by index heavyweight Tata Consultancy Services Ltd.
The S&P BSE Sensex Index rose as much as 0.2 percent to 34,000, while the 50-stock NSE Nifty 50 Index climbed 0.3 percent to 10,455.
The market breadth was tilted in the favour of buyers. Eight out of 11 sectoral indices compiled by the National Stock Exchange advanced, led by the NSE Nifty PSU Bank Index’s 0.5 percent rise after having been battered over the past few sessions. On the flip-side, NSE Nifty IT Index was the top loser, down 0.7 percent.
Here Are The Stocks Moving The Market This Morning:
Bank Of India Jumps On Bad Loans Recovery
The state-owned lender jumped 11.4 percent to Rs 106, after a PTI report said it had recovered Rs 7,000 crore of loans that were categorised as non-performing over two months. This is the most that the stock has gained since October 25, 2017.
The lender had reported a divergence in classification of bad loans, in comparison to the Reserve Bank of India’s assessment, in its results for the December quarter. It has now managed to recover a large portion of this, PTI reported. The bank expects to recover another Rs 2,000 crore of bad loans over the next two months.
The bank has embarked on a plan to improve performance, following restrictions imposed by the RBI under the Prompt Corrective Action (PCA) framework. It is aiming to bring down its net NPA ratio substantially. This would entail either increasing provisions for bad loans, or stepping up recovery of said loans.
The traded volume was 8.9 times the 30-day average, and the stock's Relative Strength Index is 29, indicating that it may be oversold.
TCS Slumps On Block Trades
Shares of the information technology major fell nearly 6 percent to Rs 2,872, after 2.84 crore of its shares changed hands in multiple block deals at the start of trade. Nearly 1.5 percent of the company’s equity changed hands in six block deals, according to a Bloomberg report.
This is the sharpest intra-day fall for the stock in over 16 months. TCS was the worst performer on both the Sensex and Nifty, and its traded volume was 87.7 times the 30-day average.
Tata Sons, based on a term sheet accessed by Bloomberg News, had agreed to sell TCS shares at Rs 2,872-2,925 each to raise Rs 8,000 crore. The price was nearly 4 percent lower than the stock’s closing price on Monday. The proceeds of the stake sale will be used by Tata Sons to pare debt in the group’s telecom company.
The stock has returned 8.5 percent since the year beginning as opposed to 0.6 percent year-to-date decline in the benchmark S&P BSE Sensex Index.
Bata India Declines On SEBI Order
Shares of the footwear and apparel manufacturer fell close to 3 percent to Rs 690, the most in a month, after SEBI ordered the company to conduct an internal probe.
The Securities and Exchange Board of India’s preliminary investigation revealed that Bata’s third quarter results in 2015 were leaked on WhatsApp before they were sent to the exchanges. The company has been asked to complete an inquiry within three months.
The regulator had earlier sent similar notices to Axis Bank, HDFC Bank, and Tata Motors.
The stock has declined 5.3 percent, compared to S&P BSE Sensex Index’s decline of 0.3 percent since the beginning of the year.
InterGlobe Falls After Cancelling Flights Following DGCA Order
Shares of the budget carrier extended recent declines and fell as much as 3 percent to Rs 1,238, a day after the government grounded some of its aircraft on safety concerns.
IndiGo has cancelled as many as 47 flights today after the country’s aviation regulator DGCA grounded eight of its A320Neo planes that are powered by reportedly faulty Pratt & Whitney engines, along with three such aircrafts of GoAir, according to a PTI report.
InterGlobe was trading at 27.3 times trailing 12-month earnings per share and 19 times its estimates for the coming year, Bloomberg data showed. The stock has gained 48 percent in the past 12 months.
Future Consumer Surges On New Coverage
Shares of the Mumbai-based consumer products firm rose as much as 8.9 percent, the most in three months, to Rs 54.8.
Motilal Oswal initiated coverage on Future Consumer Ltd. with a ‘Buy’ rating and price target of Rs 76, a near 42 percent upside from the highest price so far today. Out of the four brokerage firms tracked by Bloomberg that cover this stock, three have a ‘Buy’ rating and one has a ‘Hold’ recommendation.
Traded volume was 4.1 times the 30-day average, and the stock’s consensus price target is nearly 50 percent higher than the current price.