Sensex, Nifty Post Best Monthly Gain In Six On Earnings Outlook

Indian equity benchmarks rose to their highest level in over two months led by private sector lenders and Reliance Industries which rose to record high ahead of its March quarter earnings.

Of the 12 Nifty companies that have reported their January to March earnings so far, net incomes at six have matched or beaten analyst estimates, according to data compiled by Bloomberg.

The S&P BSE Sensex rose 0.7 percent or 256 points to 34,969.70 and the NSE Nifty 50 index climbed 0.7 percent or 74 points to 10,692.

In April, benchmarks posted their best monthly gain since October last year. The Sensex rose 6 percent and the Nifty 50 index surged 5.7 percent, making it best April in nine years.

Sixteen out of 19 sector gauges compiled by BSE ended higher led by the S&P BSE Bankex index's 2 percent gain. On the flipside, the S&P BSE IT index was the top sectoral loser, down 1 percent.

Shares of the Delhi-based jewller slumped as much as 34 percent, the biggest intraday fall since it got listed, to Rs 156.50.

Trading volume was 4.4 times its 20-day average.

Do Not Know Who Is Selling Shares: PC Jeweller On Sharp Fall

• Do not know who the seller is or what is happening with the stock price
• Have been investigating recent movement in price of the stock along with volume traded
• Have given regular disclosure to the exchanges in a timely manner
• Promoter shareholding stands at 60 percent, no plans to sell

Shares of the Mumbai-based private sector lender rose as much as 10 percent, the most in nearly four years, to Rs 543.10.

Axis Bank surged even after it reported its first quarterly loss since it was listed as analysts chose to focus on the bank’s decision to speed up recognition of stressed loans and the relatively high provision coverage ratio maintained by the bank.

• Network 18 Media has 10 lakh shares change hands in a block deal.

Buyers and sellers were not immediately known

Source: Bloomberg

Shares of the country's largest car maker erased gains after its profit missed Bloomberg consensus estimates in the March quarter n the back of higher finance and commodity cost.

The stock fell as much as 4.6 percent from day’s high to Rs 8,715.

Key earnings highlights:

• Revenues up 15.5 percent at Rs 21,166 crore versus Rs 18,333 crore
• Net profit rose 10 percent to Rs 1,882 crore versus Rs 1,710.5 crore; Bloomberg estimate of Rs 2,090 crore
• EBITDA up 18 percent at Rs 3,015 crore versus Rs 2,560 crore
• Margins at 14.2 percent versus 14 percent; BloombergQuint estimate of 15.5 percent
• Sales volume up 11.4 percent
• Recommends dividend of Rs 80 per share

Shares of the Mumbai-based real estate developer rose as much as 4.7 percent to Rs 467.50 after its profit surged more than three-fold in March quarter.

Key earnings highlights:

• Revenue declines 51 percent to Rs 145.29 crore versus Rs 299.45 crore (YoY)
• Net profit jumps 223 percent to Rs 16.48 crore versus Rs 5.09 crore (YoY)
• Joint venture's profit at Rs 33.3 crore versus Rs 12.3 crore
• To pay final dividend of Rs 6 per share

• Indian equity benchmarks extended gains and rose their highest level in led by banks and Reliance Industries which surged ahead of its March quarter earnings.
• The S&P BSE Sensex rose 1 percent or 342 points to 35,058 and the NSE Nifty 50 index climbed 98 points or 0.9 percent to 10,716.
• The overall market breadth was positive as 1,543 shares were advancing while 993 were declining.

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Shares of the Chennai-based tyre maker snapped its 5-day losing streak, the longest in over a month.

The stock rose as much as 4.8 percent to trade above Rs 80,000 mark for the first time.

Credit rating agency Fitch has affirmed its 'BBB-' rating with a stable outlook on the Indian economy.

Fitch said:

• India's weak fiscal balances constrain ratings
• Expects Reserve Bank of India to start raising policy repo rate next year

Source: Bloomberg

Shares of the Pune-based gas and air compressor maker and distributor rose as much as 17 percent to Rs 1,098 after its net profit jumped nearly three times in March quarter.

• Key earnings highlights:
• Revenue rose 77 percent to Rs 308.71 crore versus Rs 174.35 crore (YoY)
• Net profit jumped 168 percent to rs 48.07 crore versus Rs 17.90 crore (YoY)

Shares of the Mumbai-based fertiliser maker fell as much as 2.3 percent to Rs 221.45 after its net profit missed Bloomberg consensus estimates in March quarter.

Key earnings highlights:

• Revenue at Rs 371 crore versus estimate of Rs 393 crore
• Net profit at Rs 19.78 crore versus estimate of Rs 31.27 crore
• Revenue up 7 percent at Rs 371 crore (YoY)
• Net profit down 35.5 percent at Rs 20 crore (YoY)
• Ebitda down 21 percent at Rs 33 crore
• Margin at 8.9 percent versus 12.1 percent (YoY)

Shares of the Mumbai-based flexible packaging company rose as much as 10.4 percent to Rs 289.90 after its board of directors recommended bonus issue of shares in ratio oh one bonus share for every one share held, the company said in an exchange filing.

Shares of the Kolkata-based private sector lender rose as much as 5.65 percent to Rs 522.95 after its asset quality improved in March quarter.

Key earnings highlights:

• Net interest income up 25.2 percent at Rs 863 crore versus Rs 689.72 crore (YoY)
• Net profit up 20.3 percent to Rs 387.8 crore versus Rs 322.4 crore (YoY)
• Gross NPA at 1.25 percent versus 1.67 percent (QoQ)
• Net NPA at 0.58 percent versus 0.88 percent (QoQ)
• Gross NPA in absolute terms at Rs 373 crore versus 386 crore (QoQ)
• Net interest margin NIM at 9.3 percent versus 10.7 percent.
• Provisions at Rs 109 crore versus Rs 122.5 crore (QoQ); Rs 36.4 crore (YoY)

Kiran Mazumdar-Shaw while speaking to BloombergQuint on Biocon’s March quarter performance said its Generic drugs business continues to face pricing pressure.

Highlights of conversation:

• Have delivered a strong quarter for the biological segment
• Research services business showing robust growth momentum
• UAE markets have done well for the company in terms of growth
• Need to ensure higher value growth to volume growth especially in India

Shares of the Ahmedabad-based drug maker rose as much as 2.6 percent to Rs 420.

Cadila is selling stake in its joint venture Bayer Zydus Pharma to JV partner Bayer. Cadila will be selling 1.25 crore to Bayer.

• Techno Electric & Engineering: The Kolkata-based engineering service provider rose as much as 1.88 percent to Rs 355.30. Trading volume was 15.2 times its 20-day average.
• Bajaj Holdings: The Pune-based investment company rose 0.12 percent to Rs 2,630. Trading volume was 10.8 times its 20-day average.
• Motilal Oswal Financial Services: The Mumbai-based stock brokerage firm rose as much as 4.86 percent to Rs 1,007. Trading volume was 10 times its 20-day average.
• Equitas Holdings: The Chennai-based non-banking finance company rose 5.11 percent to Rs 158.50. Trading volume was 7.7 times its 20-day average.

• NCLAT to hear Numetal, ArcelorMittal pleas on Essar Steel challenging NCLT judgement on May 17

Bank Nifty's 25,500 call was among the most active option contracts on the National Stock Exchange. The premium on the contract rose over 300 percent to Rs 82.

As many as 99,640 shares were added to the open interest which stood at over 4.53 lakh shares.

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Shares of the Delhi-based power generation company rose as much as 3.85 percent to Rs 5.40.

RattanIndia Power is in talks to sell its 1,350 megawatt Nashik plant and lenders panel will study its unit sale proposal, news agency Cogencis reported citing sources.

• Revenue under GST for Aug. 2017-March 2018 at Rs 7.19 lakh crore
• Average Goods and Services Tax (GST) collection at Rs 89,885 crore per month for FY18
• CGST revenue at Rs 1.19 lakh crore
• SGST revenue at Rs 1.72 lakh crore
• IGST revenue at Rs 3.66 lakh crore (Including Rs 1.73 lakh crore on imports) and Rs 62,021 crore of cess
• SGST Collection during the year 2017-18 including the settlement of IGST has been Rs. 2.91 lakh crore
• Total compensation released to states for a period of 8 months during FY 18 was Rs 41,147 crore

Shares of the country's largest car maker rose as much as 1.8 percent to Rs 9,109.75 ahead of its March quarter earnings.

Below are Bloomberg estimates of Maruti Suzuki's March quarter earnings:

• Revenue may grow 14.4 percent to rs 20,975 crore (YoY)
• Ebitda seen rising 2 percent to Rs 3,282 crore (YoY)
• Profit expected at Rs 2,085 crore, up 22 percent (YoY)
• Margin seen at 15.6 percent versus 14 percent (YoY)

Shares of the Bangalore-based bio-pharmaceutical company fell as much as 1.8 percent, the most since April 4, to Rs 651.35 after its net profit rose for the first in five quarters.

Key earnings highlights:

• Revenue up 26 percent at Rs 1,169.5 crore.
• Net profit up 2 percent at Rs 130 crore.
• Ebitda up 24 percent at Rs 232.5 crore.
• Margin at 19.9 percent versus 20.3 percent.

Shares of the Bangalore-based food processing company were locked in a five percent upper circuit at Rs 2.10 after Aspire Emerging Fund bought 2.16 crore shares or 1.4 percent equity at Rs 1.89 each in the company.

While, Elara India Opportunities Fund sold 2.23 crore shares or 1.5 percent equity at Rs 1.89 each.

Shares of the Mumbai-based pressure cooker maker fell as much as 7.4 percent to Rs 3,105 after it saw a slew of bulk deals in trade yesterday.

• EQ India Fund bought 46,071 shares or 0.9 percent equity at Rs 2,811.42 each
• Porinju Veliyath’s Equity Intelligence India bought 38,721 shares or 0.7 percent equity at Rs 2,811 each
• Hober Mallow Trust sold 1.15 lakh shares or 2.2 percent equity at Rs 2,811.40 each

Shares of the software developer fluctuated between gains and losses and fell 1.5 percent to 750.10 as of 9:35 a.m.

The company acquired semiconductor firm Ansem N.V. in an all-cash deal worth $17 million, according to its stock exchange filing.

The relative strength Index was 79, indicating that the stock may be overbought. The stock returned 45.9 times over the past year, compared to 17.5 percent gain in Sensex.

Shares of the conservative energy equipment maker snapped two-day decline and rose as much as 3.3 percent to Rs 1,169.45.

The company won Rs 279 crore order for a captive cogeneration power plant, according to its stock exchange notification.

The stock is testing resistance at 50-day moving average, Bloomberg data showed. Thermax trades at 35.4 times estimated forward earnings per share compared to 33.2 times for its two-year historical average.

Mark Matthews, head of research (Asia) at Bank Julius Baer in a conversation with BloombergQuint Indian companies to report robust earnings this quarter.

Highlights of conversation:

• U.S. yields have been twice as high on average
• Stocks won't react until yields get to 5-6 percent
• U.S. bond yields highest amongst developed economies
• Inflows to continue in global equities as U.S. is expensive
• Domestic economy drives Indian market
• Less subject to imports/exports from other parts of the world
• Net sellers in flows since H2CY2017
• Oil price rise, government covering for OMCs' losses, politics key factors
• No strong conviction on any major currencies
• Dollar well supported by yield
• Not sure if dollar will skyrocket further
• RBI'S hawkish tone, later hikes should help support rupee and higher yields
• Neutral on oil, expect it to remain at $65 per barrel levels
• U.S. sanctions on Iran, OPEC and Russia production cuts key factors
• Inventories in developed countries back to zero
• See no reason for oil prices to collapse
• Do not expect crude to go higher
• BJP will continue to push reforms if it wins
• Robust earnings this year, meeting expectations
• Have strong domestic fund flow

Shares of the Mukesh Ambani-led oil-to-telecom conglomerate rose as much as 3.6 percent to record high of Rs 1,010.70 ahead of its March quarter earnings.

Below are Bloomberg estimates of RIL's March quarter earnings:

• Revenue seen rising 22.5 percent to Rs 89,734 crore from previous quarter
• Ebitda may grow 9 percent to Rs 14,939 crore sequentially
• Net profit seen 5.5 percent higher at Rs 8,923 crore
• Gross refining margin expected at $11.2 per barrel from $11.6 barrel per barrel

Shares of the Mumbai-based private sector lender rose as much as 5.88 percent, the most in over two months, to Rs 522.80.

Axis Bank reported its first ever quarterly loss since listing as the bank accelerated recognition of bad loans, leading to a surge in provisions.

The private lender reported a net loss of Rs 2,188.7 crore in the January-March quarter compared with a profit of Rs 1,225 crore a year ago, according to its exchange filing. Analysts tracked by Bloomberg had estimated a Rs 663 crore profit. The bank also reported tax write-back of Rs 1,300 crore, without which the net loss would have been wider.

The bank rebounded from three-day losing spree after the outgoing CEO Shikha Sharma announced a new business strategy for financial year 2018-19 that would focus on normalising credit risk, delivering profitable growth, enhance capabilities and invest in the future.

According to both Shikha Sharma and Jairam Sridharan, Axis Bank’s asset quality and profitability will improve in the second half of the current financial year. The progress in the insolvency and bankruptcy process, a pick-up in the investment climate and a healthy consumer growth story gave Sharma confidence of a turnaround.

Analysts Cite Cheap Valuations Behind Sharp Upmove In Axis Bank

Speaking to BloombergQuint stock market analysts cited cheap valuations behind the sharp upmove.

Siddharth Purohit, SMC Institutional Equities

• There is clarity that going ahead there will be no restructuring until there is a new NPA
• Axis Bank has taken a bold step to clean up the balance sheet
• Credit cost stabilisation is positive for Axis Bank
• Stock is trading at cheap valuations. As it trades at 1.8 times price to book value based on FY20 forward earnings

Manish Ostwal, Nirmal Bang

• Axis Bank earnings were below expectations, but market is factoring the relative valuation to other banks
• Incremental NPA for FY 19 will be significantly lower
• Bottom fishing happening at current levels as other banks trade at price to book value of three times

Indian equity benchmarks edged higher led by Reliance Industries, Axis Bank, ICICI Bank and Larsen & Toubro.

The S&P BSE Sensex rose 0.6 percent or 217 points to 34,926 and the NSE Nifty 50 index gained 0.6 percent or 68 points to 10,686.

Sixteen out of 19 sector gauges compiled by BSE were trading higher led by the S&P BSE Energy index's 1.8 percent gain. On the flipside, the S&P BSE telecom index was the top sectoral loser, down 0.3 percent.

• Rupee opened lower at 66.82 per U.S. dollar against yesterday's close of 66.75.

• Believe it is not yet the end of bad loan recognition
• Performance is not completely out of our expectation
• Don't know how resolution will play out in the power sector
• Power sector will continue to be a pain point for the sector

The Indian rupee is seen opening weaker, and is headed for its third straight week of losses as outflows increase from local stocks and bonds amid rising U.S. yields.

The implied opening from forwards suggests onshore rupee may start trading around 66.8875 having ended Thursday at 66.7550. The rupee has lost nearly 1 percent this week and is now the worst performing currency in Asia so far this year.

The rupee's weakness and a surge in oil prices is fanning inflationary pressures and keeping appetite for bonds rather muted.

Sovereign bonds are also headed for a third straight weekly loss. They slid Thursday after underwriters had to pick up nearly the entire short debt on sale. Primary dealers bought Rs 2,960 crore of 2023 bonds out of Rs 3,000 crore on sale.

The benchmark 10-year yield rose 2 basis points to 7.76 percent on Thursday and it has jumped 36 basis points this month.

• Reliance Industries
• Maruti Suzuki India
• UPL

Other Earnings To Watch

• Bandhan Bank
• Equitas Holdings
• IDFC
• RBL Bank
• Shoppers Stop
• Shriram Transport Finance
• Atul
• Automobile Corporation Of Goa
• Industrial & Prudential Investments Co
• Jagran Prakashan
• JSW Holdings
• Khaitan
• Mahindra Lifespace Developers
• Nelco
• Nivi Trading
• Salem Erode Investments
• Shriram Asset Management Co
• Uniphos Enterprises
• Vardhman Special Steels
• VTM
• Merck

Axis Bank Q4 (YoY)

• Net interest income flat at Rs 4,730 crore.
• Net loss of Rs 2,189 crore versus profit of Rs 1,225 crore.
• Provisions up 155 percent at Rs 7,195.5 crore (QoQ).
• GNPA at 6.77 percent versus 5.28 percent (QoQ).
• NNPA 3.4 percent versus 2.56 percent (QoQ).

Also Read: Axis Bank Posts First Ever Loss As Bad Loans Pile Up

Biocon Q4 (YoY)

• Revenue up 26 percent at Rs 1,169.5 crore.
• Net profit up 2 percent at Rs 130 crore.
• Ebitda up 24 percent at Rs 232.5 crore.
• Margin at 19.9 percent versus 20.3 percent.

SBI Life Insurance FY18 (YoY)*

• Annualised premium equivalent up 27 percent at Rs 8,540 crore.
• Value of new business up 34 percent at Rs 1,390 crore.
• VNB Margin at 16.2 percent versus 15.4 percent.
• Solvency Ratio at 2.06 versus 2.04.

*Quarterly figures not given

Kirloskar Pneumatic Q4 (YoY)

• Revenue up 90 percent at Rs 309 crore.
• Net profit at Rs 48 crore versus Rs 18 crore.
• Ebitda at Rs 75 crore versus Rs 26 crore.
• Margin at 24.3 percent versus 16 percent.

AU Small Finance Bank Q4 (YoY)

• Net interest income up 30 percent at Rs 287 crore.
• Net profit up 6 percent at Rs 83 crore.
• Provisions down 9 percent at Rs 30 crore (QoQ).
• GNPA at 2.01 percent versus 2.83 percent (QoQ).
• NNPA at 1.27 percent versus 1.87 percent (QoQ).

Shriram City Union Q4 (YoY)

• Net interest income up 14 percent at Rs 812 crore.
• Net profit at Rs 47 crore versus Rs 12 crore.

Rallis India Q4 (YoY)

• Revenue up 7 percent at Rs 371 crore.
• Net profit down 35.5 percent at Rs 20 crore.
• Ebitda down 21 percent at Rs 33 crore.
• Margin at 8.9 percent versus 12.1 percent.

Jindal Stainless (Hisar) Q4 (YoY)

• Revenue up 10 percent at Rs 2,254 crore.
• Net profit up 60 percent at Rs 96 crore.
• Ebitda up 20 percent at Rs 286 crore.
• Margin at 12.7 percent versus 11.6 percent.

Reliance Capital Q4 (YoY)

• Revenue down 1 percent at Rs 5,000 crore.
• Net profit up 3 percent at Rs 428 crore.

Accelya Kale Q4 (YoY)

• Revenue down 2 percent at Rs 93 crore.
• Net profit down 15 percent at Rs 22 crore.
• Ebitda flat at Rs 37.5 crore.
• Margin at 40.3 percent versus 39.5 percent.

IEX Q4 (YoY)

• Revenue up 8 percent at Rs 55 crore.
• Net profit up 15 percent at Rs 31 crore.
• Ebitda up 23 percent at Rs 43 crore.
• Margin at 78 percent versus 69 percent.

Essel Propack Q4 (YoY)

• Revenue up 3 percent at Rs 628 crore.
• Net profit up 2 percent at Rs 45 crore.
• Ebitda down 3 percent at Rs 116 crore.
• Margin at 18.5 percent versus 19.6 percent.

Aditya Birla Money Q4 (YoY)

• Revenue up 28 percent at Rs 43.5 crore.
• Net profit up 7 percent at Rs 4 crore.

Tata Metaliks Q4 (YoY)

• Revenue up 36 percent at Rs 546 crore.
• Net profit up 37.5 percent at Rs 55 crore.
• Ebitda up 18 percent at Rs 88 crore.
• Margin at 16.1 percent versus 18.6 percent.

• 15 IDBI officals named in bank fraud case, raids conducted at 50 locations: CBI Official.
• Fortis to discuss further board restructuring on April 27.
• Thermax won Rs 279 crore order for a captive cogeneration power plant.
• IEX board decided not to go ahead with buyback.
• Essel Propack’s board recommended 1:1 bonus issue.
• Cyient acquired semiconductor firm Ansem N.V. in an all cash deal worth $17 million.
• Gati approved inducting new strategic and/or financial partner.
• CCI finds no Appreciable Adverse Effect on Competition in respect of Tata Steel’s proposed acquisition of Bhushan Steel.
• Apollo Micro Systems said that the company officials were asked to appear before IT officials on April 25.
• MOIL signed MoU with Ministry of Steel for FY19.
• Mangalore Chemicals and Fertilisers shuts down ammonia, urea and ABC Plants for annual turnaround maintenance.

• Nifty May futures closed trading at 10,632.5 with premium of 14.7 points versus 21.7 points.
• Nifty rollover at 72 percent, Bank Nifty rollover at 83 percent.
• All series: Nifty open interest up 6 percent, Bank Nifty open interest up 5 percent.
• India VIX ended at 12.03, down 2.8 percent.
• Max open interest for May series at 11,000 (open interest at 43.8 lakh, up 62 percent).
• Max open interest for May series shifts to 10,500 (open interest at 30.6 lakh, up 47 percent).

Stocks Seeing High Open Interest Change

Coffee Day Enterprises

• Marina West (Singapore) Pte. Ltd. sold 12.66 lakh or 0.6 percent equity at Rs 332.05 each.

Karnataka Bank

• Copthall Mauritius Investment sold 19.26 lakh shares or 0.7 percent equity at Rs 116.72 each.

Hawkins Cookers

• EQ India Fund bought 46,071 shares or 0.9 percent equity at Rs 2,811.42 each
• Porinju Veliyath’s Equity Intelligence India bought 38,721 shares or 0.7 percent equity at Rs 2,811 each
• Hober Mallow Trust sold 1.15 lakh shares or 2.2 percent equity at Rs 2,811.40 each

Karturi Global

• Aspire Emerging Fund bought 2.16 crore shares or 1.4 percent equity at Rs 1.89 each.
• Elara India Opportunities Fund sold 2.23 crore shares or 1.5 percent equity at Rs 1.89 each.

Trading Tweaks

• Vakrangee shifted to T group.
• HDIL circuit filter revised to 20 percent.

• Indian monsoon hurls almost 37,000 lightning bolts in single day
• CBI books former Aircel promoter’s firms, two bank chiefs
• NITI Aayog says 35.3 lakh new jobs created in six months till February
• Biocon’s net profit rises for the first time in five quarters
• PM Modi arrives in Wuhan for two-day ‘informal’ summit with Xi
• Crude holds near three-year high as focus remains on Iran deal
• Rosneft-owned Essar Oil to be called Nayara Energy
• Flipkart to get Rs 55 crore tax refund after income tax appellate tribunal ruling
• A triple-whammy for India
• Seems like a resurrection of ‘emergency’ days: Arvind Datar
• Deciphering India’s ‘China reset’
• The world’s richest person just added $12 billion to his fortune
• Why telecom firms will keep asking users to link mobile SIM cards to Aadhaar

Good Morning!

The Singapore-traded SGX Nifty, an early indicator of NSE Nifty 50 Index’s performance in India rose 0.4 percent to 10,658 as of 7:55 a.m.

Asian stocks climbed as the latest bout of earnings results buoyed sentiment in the technology sector and traders monitored a historic meeting between the leaders of North and South Korea. The dollar held gains and Treasuries rebounded.

Most equity markets across the region advanced, though Japan pared gains and Chinese share declined. Nasdaq futures were boosted after companies including Amazon.com Inc., Intel Corp and Baidu Inc. all forecast second-quarter profit that topped analysts’ forecasts.

Commodities

• West Texas Intermediate crude fell 0.4 percent to $67.94 a barrel.
• Gold dropped less than 0.05 percent to $1,316.71 an ounce.
• LME copper fell 0.4 percent to $6,937.00 per metric ton.