Stocks To Watch: Adani Ports, Ajanta Pharma, Bharat Electronics, UPL
Asian equities opened mixed as investors evaluated whether earnings can deliver on high expectations against a backdrop of trade tensions.
Japan’s Topix index ticked higher, while stocks fell in Australia and South Korea. Hong Kong futures pointed to declines for shares there. The Singapore-traded SGX Nifty, an early indicator of NSE Nifty 50 Index’s performance in India, fell 0.1 percent to 10,934.50 as of 6:55 a.m.
Here Are The Stocks To Watch Out For In Today’s Trade
- UPL is said to seek $3 billion loan to buy Ackman-backed Arysta, Bloomberg reported.
- HDFC Bank: To decide pricing of share allotment to parent HDFC
- IHH made mandatory open offer to shareholders of Fortis Healthcare.
- Bharat Electronics signed MoU with Sweden’s SAAB for 3D air surveillance radar.
- L&T and BEML signed pact to explore domestic and export markets for defence projects and services.
- Ajanta Pharma clarified DGCA has not taken action against the company.
- Adani Ports arm to form joint venture with Nyk Auto Logistics for transportation of vehicles using freight trains.
- Apex Frozen Foods, Avanti Feeds and Waterbase in focus as the U.S. Department of Commerce finalises the antidumping duty rate, on certain frozen warmwater shrimp from India, at 1.35 percent.
- Maruti Suzuki: Is said to launch new entry-level car in 2020. (Mint)
- Mukund: Approves merger four units, associate companies with itself.
- Tata Steel: Is said in talks for up to $3.1 billion overseas loans (Economic Times)
Earnings To Watch
- Zee Entertainment
- 8K Miles
- Ashok Leyland
- Federal Bank
- ICICI Lombard General Insurance
- Muthoot Capital Services
- Nucleus Software Exports
- Rallis India
- Sintex Industries
- Tata Sponge Iron
Earnings Reaction To Watch
HUL (Q1, YoY)
- Revenue up 11.2 percent at Rs 9,487 crore.
- Net profit up 19.2 percent at Rs 1,529 crore.
- Ebitda up 20.6 percent at Rs 2,251 crore.
- Margin at 23.7 percent versus 21.9 percent.
Jay Bharat Maruti (Q1, YoY)
- Revenue up 34.1 percent at Rs 505.9 crore.
- Net profit up 32.7 percent at Rs 13.4 crore.
- Ebitda up 46.2 percent at Rs 42.4 crore.
- Margin at 8.4 percent versus 7.7 percent.
Sintex Plastics Technology (Q1, YoY)
- Revenue down 12.2 percent at Rs 1325.2 crore.
- Net profit down 46.9 percent at Rs 37.5 crore.
- Ebitda down 29.9 percent at Rs 162.8 crore.
- Margin at 12.3 percent versus 15.4 percent.
- PVR: MFS International New Discovery Fund acquired 2.96 lakh shares or 0.63 percent equity at Rs 1191.75 each.
- Promoter Jtket Corporation sold 1.14 crore shares or 5.75 percent equity at Rs 91.16 each.
- Reliance Capital acquired 60 lakh shares or 3.02 percent equity at Rs 91.1 each.
- India Acorn Fund Ltd. acquired 12 lakh shares or 0.60 percent equity at Rs 91.1 each.
- White Oak India Equity Fund acquired 13.5 lakh shares or 0.68 percent equity at Rs 91.1 each.
- RBS acquired 2.5 lakh shares or 2.3 percent equity at Rs 473 each.
- Maven India Fund sold 71,000 shares or 0.6 percent equity at Rs 475 each.
- RC Tritec AG sold 60,000 shares or 0.5 percent equity at Rs 470 each.
Who’s Meeting Whom
- GPT Infraprojects to meet investors on July 17.
- Indiabulls Housing Finance to meet investors from July 16-20 in U.K. and Singapore.
- Mirc Electronics to meet ASK investment, Trust Capital and Florintree Advisors on July 17.
- Rushil Decor to meet SBI Mutual Fund and Fidelity Investments on July 17.
- JSW Steel promoter group acquired 6.16 lakh shares from July 12-13.
- Singer India promoter sold 1.03 lakh shares from July 12-13.
- Sadbhav Infrastructure Projects promoter acquired 30,000 shares from July 11-12.
- Den Networks circuit filter revised to 10 percent.
- D B Corp ex date to determine buyback eligibility.
- M.M.Forgings last trading day before ex date for 1:1 bonus.
- Rupee closed at 68.57/$ on Monday from 68.53/$ on Friday. Widening trade deficit along with foreign outflows weighed on the currency.
- Nifty July futures closed trading at 10,944 premium of 7 points versus 1 point.
- July series: Nifty open interest down 3 percent and Bank Nifty open interest down 6 percent.
- India VIX ended at 12.9, up 5.2 percent.
- Max open interest for July series at 11,000 Call (open interest at 39.6 lakh, up 19 percent)
- Max open interest for July series at 10,600 Put (open interest at 47.2 lakh, down 6 percent)
In ban: Jet Airways
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Active Stock Futures
HSBC on Finolex Industries
- Initiated ‘Buy’ with a price target of Rs 750.
- Policy, capacity and improving margins all flowing through.
- Expect PVC resin fundamentals to improve.
- Rise in weightage of more stable pipes business to make margins less volatile.
- Finolex trades at steep discount, despite similar growth profile and strong balance sheet.
IDFC Securities on GAIL
- Maintained ‘Outperformer’; hiked price target to Rs 434 from Rs 410.
- Expect June quarter to see stellar performance.
- GST inclusion and aggressive bidding in the CGD auction are positive triggers.
- Petchem expansion to stabilize gradually.
- Transmission and trading volumes set to grow steadily.
- Unified tariff approval: every 10 percent hike can boost EPS by 7 percent.
- Profitability in LPG segment to remain strong over the current and next financial year.
Nomura on proposed Axle Norms
- Proposed truck axle load relaxation led to sharp correction in Ashok Leyland and Tata Motors.
- Impact on truck demand depends on execution of proposed norms.
- If implemented on existing vehicles then demand for new vehicles to be impacted.
- If implemented on new vehicles then positive for short term demand.
BofA-ML on Proposed Axle Norms
- Proposed rated load to be increased by 15-25 percent.
- If implemented on current fleet, then it will impact demand for new trucks.
- Change in norms to bring down the existing overloading issues.
- Impact of these norms is difficult to gauge as it depends on state-wise implementation.
- Uncertainty to remain an overhang for stock prices of Ashok Leyland and Tata Motors.
Edelweiss on Hindustan Unilever
- Maintained ‘Hold’; raised price target to Rs 1,887 from Rs 1,647.
- June quarter numbers came inline with estimates.
- Growth was broad based aided by gradual improvement in demand.
- Triggers: New launches, performance of Indulekha & Ayush and revival of rural demand.
- Hold as stock offers limited upside from current levels.
Nomura on Coal India
- Upgraded to ‘Buy’ from ‘Neutral’; cut price target to Rs 318 from Rs 332.
- Sanguine earnings outlook and inexpensive valuations turn risk-reward favourable.
- Higher blended realisation to result in EPS CAGR of 24 percent over the fiscal 2018-2020.
- Expect 7 percent CAGR in offtake over the financial years till March 2021 with no negative surprises in operating expense.
Credit Suisse On Sun Pharma
- Maintained ‘Outperform’ with a price target Rs 600.
- Details of MK-3222 formulary inclusion has started trickling.
- MK-3222 likely classified as Tier 4 coverage at United.
- High discount strategy could work for Sun Pharma.
- Expect Sun to take peak volume share of 4-5 percent in market of $7-8 billion
Motilal Oswal on Hindustan Unilever
- Maintained ‘Buy’; raised price target to Rs 2,010 from Rs 1,925.
- Broad-based growth encouraging.
- Margins impressive despite high ad spend.
- Offers highest earnings visibility and return ratios in large-cap Indian consumer space.
Macquarie on Indian Metals
- China remains focused on pollution control.
- More cities in restricted list means more cuts in steel capacity.
- No new cuts in aluminium, but cost support may rise.
- Believe Asian steel margins will remain high on account of high utilisation levels.
- Favourable terms for EAF capacity addition should keep graphite electrode market tight.
- Indian metals equities corrected on trade war risks.
- Remain constructive on steel equities, graphite electrode producers, Hindalco and Coal India.