Cash in India is almost back to levels seen before demonetisation. At least in absolute terms.

Stocks Radar: Godrej Consumer, NTPC, ICICI Bank

The Indian equity benchmarks rose for the seventh consecutive session in early trade with the S&P BSE Sensex gaining as much as 0.19 percent to 37,406.5 and the NSE Nifty 50 Index climbing as much as 0.14 percent to 11,294.3 as of 10.10 a.m.

The other Asian stocks, however, opened lower in anticipation of fiscal policy tweaks from central banks’ meeting lined up this week.

The market breadth was tilted in favour of buyers. Seven of the 11 sectoral gauges compiled by the National Stock Exchange declined, led by a 0.68 percent fall in the NSE Nifty IT Index. The NSE Nifty PSU Bank Index was the biggest sectoral gainer, up 2.73 percent.

Here Are The Stocks Moving The Markets This Morning

Gati Gains On Reports Of A Deal With TVS Logistics

Shares of the cargo distributor and supplier gained as much as 19.4 percent to Rs 110.05 apiece after Economic Times reported that TVS Logistics is in talks with Gati to buy a controlling stake in the company for Rs 1,500 crore.

The trading volume of the stock was at 26.4 times the 20-day average, Bloomberg data showed.

Pioneer Distilleries Falls After Pollution Control Board Order

Shares of the industrial alcohol maker lost as much as 10.91 percent, the most in a year, to Rs 251.90 apiece.

The Maharashtra Pollution Control Board has directed the company to shut all its manufacturing activities. The distillery is seeking legal advice to appeal to a court, challenge and set aside the closure order, according to an exchange filing.

The stock trades at 4.8 times trailing 12-months earnings per share, Bloomberg data showed.

Godrej Consumer Gains On Bonus Share Proposal

Shares of the lifestyle and utility product maker snapped its two-day decline and gained as much as 1.6 percent to Rs 1,308.4 apiece. The ‘Cinthol’ soap maker said it is planning to issue bonus shares.

The stock, which jumped the most in a year last week, trades at 59.8 times trailing 12-months earnings per share. The stock is 12 percent above the Bloomberg consensus one-year target price.

ICICI Bank Gains Despite Q1 Loss

Shares of the private sector lender gained as much as 3.6 percent to Rs 299.45 apiece.

ICICI Bank’s unexpected loss in the first quarter on higher provisions shows the lender is expediting the cleanup of bad loans on its balance sheet, analysts at Goldman Sachs and Jefferies said.

The Mumbai-based lender, which is being probed for alleged impropriety, saw provisions more than double in the first quarter while fresh bad loans were the lowest in 11 quarters. Its provision coverage ratio widened by 560 basis points to 66.1 percent in the quarter.

“The visibility and confidence on earnings grows post management’s intention of increasing the PCR to 70 percent and making most of the provisioning during FY19,” Goldman Sachs wrote in a note on Saturday.

Brokerages on ICICI Bank

Goldman Sachs

  • Maintained ‘Buy’ with a price target of Rs 375.
  • Bank reported pick-up in core operating profit growth.
  • Accelerated balance sheet clean up by increasing provisioning charge.
  • Fresh NPL slippages were much lower than expectations.
  • Multiple catalysts to drive stock performance.

Kotak

  • Maintained ‘Buy’ with a price target of Rs 400.
  • Most metrics show improving trends.
  • Internals of results broadly suggest a gradual recovery.
  • No new negative surprises under new management.
  • High provisions result in a loss; New disclosures not too worrisome.

Jefferies

  • Maintains buy, reduces price target to Rs 365 from Rs 380.
  • Formation of new bad loans and stressed assets continues to improve.
  • Core profit will improve due to rising loan growth and NIMs.
  • Cuts FY19 earnings estimate 34.2 percent citing higher-than-expected bad loan charges.
  • Earnings may grow at compounded rate of 45 percent over FY18-21.

Citigroup

  • Maintains buy, price target Rs 390.
  • Operating profit before provisions was 3 percent ahead of Citi’s estimate.
  • Fresh bad loans declined sharply to 11-quarter low 10b worth of slippages were driven by rupee depreciation.
  • Lowers FY19/20 earnings estimates by 13 percent and 10 percent, respectively, citing higher provisions for bad loans.

NTPC Declines After Profit Miss

Shares of the state-run power distributor fell as much as 2.19 percent to Rs 154.55 apiece.

The company’s profit for the quarter ended June missed analyst estimates, as expenses rose by more than Rs 2,000 crore versus the same period last year. The stock trades at 12.2 times trailing 12-months earnings per share, according to Bloomberg data.