All You Need To Know Going Into Trade On April 23
Stocks in Asia eked out modest gains at the open Tuesday as investors look to a deluge of earnings for reasons to carry an equity rally further.
Equities rose in Japan and Australia where traders returned from the Easter break, as well as in Korea. The Singapore-traded SGX Nifty, an early indicator of NSE Nifty 50 Index’s performance in India, traded a little changed at 11,619 as of 7:10 a.m.
Short on time? Well, then listen to this podcast for a quick summary of the article!
Here’s a quick look at all that could influence equities today.
U.S Market Check
- U.S. equities eked out a gain in light volume as investors prepared for a deluge of earnings news. Oil jumped after the White House said it will scrap waivers that allow the purchase of some Iranian crude.
- The yield on 10-year Treasuries dipped to just below 2.59 percent after rising three basis points in the previous session.
- Japan’s Topix index rose 0.3 percent as of 9:06 a.m. in Tokyo.
- Australia’s S&P/ASX 200 Index rose 0.2 percent.
- South Korea’s Kospi index was up 0.2 percent.
- Hong Kong’s Hang Seng Index futures added 0.5 percent.
- Brent crude gained 0.27 percent to hover near a six-month high of $74.43 per barrel.
- West Texas Intermediate crude extended a 2.5 percent advance, rising 0.5 percent to $65.86 a barrel.
- Gold was little changed at $1,274.37 an ounce.
Stocks To Watch
- Blackstone Group will buy a controlling stake in Essel Propack Ltd., a company promoted by Ashok Goel, the younger brother of Subhash Chandra who’s the promoter of the Essel Group companies such as Zee Entertainment Enterprises Ltd.
- GAIL emerged as the highest bidder for IL&FS wind energy assets, offers Rs 4,800 crore portfolio of wind assets. The total debt of the wind portfolio stands at Rs 3,700 crore and there will be no haircut of lenders. (IL&FS Statement)
- Mcleod Russel executed sale agreement for specified assets from its three estates to Luxmi Tea for Rs 150.45 crore. Earlier, the company had entered in to a non-binding term sheet with Saffron Enclave for sale of specified assets of the aforesaid three estates, which has expired on March 31.
- Indian state refiners have firmed up oil supplies from alternate sources to replace Iran oil volumes for next month as contingency plan for non-renewal of U.S. waivers: government official (Bloomberg News)
- Man Infraprojects fixed record day as May 6 for purpose of allotment of free shares of the company to Man Industries.
- Biocon said it will consider issuing of bonus shares on April 25.
- Hindustan Copper to consider raising capital via QIP on April 25.
- Sunteck Realty to consider raising funds on May 2
- Deepak Fertilizer and Petrochem approved raising $60 million via issue of foreign currency convertible bonds and compulsory convertible debentures to International Finance Corporation.
- Piramal Enterprises: Board approved allotment of 1.3 crore shares pursuant to conversion of compulsory convertible debentures aggregating to Rs 3,668.6 crore.
- Suven Life Sciences completed purchase of assets of Rising Pharmaceuticals through its joint venture partner Shore Suven Pharma.
- Bank of India allotted 51.76 crore equity shares at Rs 89.6 per share, aggregating to Rs 4638 crore to the Government of India.
- Hindustan Fluorocarbons board to meet on April 29 for approval of e-auction details received from MSTC on sale 66 acres of land.
- Lakshmi Vilas Bank to hold extra-ordinary annual general meeting on May 20. Board also approved Rs 112 per equity share as the actual price at which the equity shares will be issue and allotted to Indiabulls Housing Finance on a preferential basis.
- State Bank of India offered loans at 20 basis points lesser interest than existing car loan schemes to buy electric vehicles.
- Symphony surrendered lease rights of its Surat SEZ unit for Rs 3.5 crore on April 5. The company said this unit contributed nothing to the company’s revenue.
- Texmaco Rail and Engineering to consider raising funds on April 25.
- TCS to provide digital solutions to India Post.
Also read: Volatility In India VIX Jumps To 3-Year High
Earnings To Watch
- Coromandel International
- ICICI Securities
- Indiabulls Integrated Services
- Indiabulls Real Estate
- Sasken Technologies
- Sterlite Technologies
- Tata Global Beverages
- Menon Bearings
- Nucleus Software Exports
- SORIL Infra Resources
Earnings Reaction To Watch
Lux Industries (Q4 Standalone, YoY)
- Revenue up 15.9 percent to Rs 385.6 crore.
- Net profit up 23.7 percent to Rs 37.6 crore.
- Ebitda down 2.4 percent to Rs 56.4 crore.
- Margin at 14.6 percent versus 17.4 percent.
- Inventory loss of Rs 86.4 crore.
- Employee cost up 34 percent to Rs 11 crore.
- Other Income of Rs 9 crore.
- Declares dividend of Rs 3.5 per share.
Swaraj Engines (Q4, YoY )
- Revenue up 3.3 percent to Rs 191.5 crore.
- Net profit down 6.7 percent to Rs 16.7 crore.
- Ebitda down 4.2 percent to Rs 27.4 crore.
- Margin at 14.3 percent versus 15.4 percent.
- Raw materials as percent of Sales at 79 percent versus 74 percent
- Declares dividend of Rs 25 per share and special dividend of Rs 25 per share.
Tejas Networks (Q4 Consolidated, YoY)
- Revenue up 2.7 times to Rs 273.1 crore.
- Net profit up 9.5 percent to Rs 35.9 crore.
- Ebitda up 4.9 times to Rs 52.8 crore.
- Margin at 19.3 percent versus 10.5 percent.
- Deferred tax income of Rs 24.3 crore in base quarter.
AU Small Finance Bank (Q4, YoY)
- Net Interest Income up 34.9 percent to Rs 386.9 crore.
- Net profit up 42.4 percent to Rs 118.2 crore.
- Provisions at Rs 39.2 crore versus Rs 32.1 crore (Rs 32.5 crore QoQ).
- GNPA at 2.04 percent versus 2.09 percent (QoQ).
- NNPA at 1.29 percent versus 1.31 percent (QoQ) .
- Axis Trustee Services sold 51.81 lakh shares (2.05 percent) at Rs 137.45 each.
- Bharti Airtel ex-date for rights issue of equity shares (19:67 at premium of Rs 215 per share).
- Prakash Industries ex-date for spin off.
- Trescon to move into ASM Framework.
- Essar Shipping to move into short term ASM Framework.
- 5paisa Capital price band revised to 10 percent.
- JBF Industries price band revised to 5 percent.
Who’s Meeting Whom
- Mahindra & Mahindra to meet Value Research Stock Advisor on April 23.
- Omax Autos promoter Warun Mehta sold 3,800 shares on April 16.
Money Market Update
- The rupee on Monday closed at 69.67/$ versus Thursday’s 69.35/$.
Exclusion Of F&O Contracts
- Ajanta Pharma
- Allahabad Bank
- Canfin Homes
- CG Power
- Chennai Petro
- DCB Bank
- Godfrey Phillips
- Godrej Industries
- Gujarat State Fertiliser
- India Cements
- Indian Bank
- IRB Infra
- Jet Airways
- Jain Irrigation
- Kaveri Seed
- Karnataka Bank
- Oriental Bank
- PC Jeweller
- Repco Home
- Reliance Power
- South Indian Bank
- Syndicate Bank
- Tata Communications
- TV18 Broadcast
- VGuard Industries
Futures Across all series
- Nifty open interest up 1 percent, adds 1.9 lakh shares in open interest.
- Bank Nifty open interest down 11 percent, sheds 2.5 lakh shares in open interest.
- Nifty Rollover 26 percent, Bank Nifty Rollover 22 percent.
- Nifty PCR at 1.34 versus 1.57 (across all series)
Nifty Options Expiry 25 April
- Max open interest at 11,700 Call (41.5 lakh shares), 12,000 Call (41.4 lakh shares) & 11,800 Call (30.2 lakh shares).
- Open interest addition seen for call strikes 11,700 (+29 lakh shares), 12,000 Call (+9.8 lakh shares), 11,750 (+8.7 lakh shares).
- Open interest shedding seen for Put strikes 11,000 (-8.8 lakh shares), 11,700 (-8.4 lakh shares).
Stocks In F&O Ban
- Adani Power*
- Jet Airways*
- PC Jewellers
- Reliance Capital
*New in ban
CLSA on Autos
- Few reasons to turn positive on industry outlook.
- Hero: Potential success of new products.
- Bajaj: Strong growth in higher margin export is key upside.
- TVS: Outsized market share gains could drive upside.
- Eicher: Risk of elongated underperformance to industry.
Morgan Stanley on AU Small Finance
- Maintained ‘Equal-weight’ with target price of Rs 560.
- Net profit above estimates driven by net interest income and lower provisions.
- Disbursements growth lower at 20 percent partly due to high base.
- Asset quality was strong.
Deutsche Bank on Cement Stocks
- Ambuja: Maintained ‘Hold’; hiked target price to Rs 235 from Rs 230.
- ACC: Maintained ‘Buy’; hiked target price to Rs 1,830 from Rs 1,790.
- Shree Cement: Maintained ‘Buy’; hiked target price to Rs 21,600 from Rs 19,330.
- Ramco Cement: Maintained ‘Buy’; hiked target price to Rs 790 from Rs 785.
- Ultratech: Maintained ‘Buy’; hiked target price to Rs 4575 from Rs 4240.
- Cost leaders focusing on profitability is positive for industry.
- Demand growth seen moderating; monsoon holds the key.
- Prices up 10 percent year to date on pan-India basis with hike across the board.
Axis Capital on Tejas Networks
- Maintained ‘Buy’; cut target price to Rs 235 from Rs 290.
- Strong quarter led by revenue from international market.
- Diversification to be value accretive and reduce earnings volatility.
- Cut target to factor in lower margin estimates.