All You Need To Know Going Into Trade On April 20

Brokerages On HDFC Bank

Citi Research

• Buy rating with a price target of Rs 1,225
• Strong growth in Q4 with rise in contingent provisions
• Strong growth in deposits, wholesale loans
• Higher provisions while NPAs are stable

JPMorgan

• Overweight rating maintained
• Price target of Rs 1,150
• Strong growth; strengthened provision reserves
• Asset quality stable across verticals
• Succession now finalised

Axis Capital

• Buy rating maintained
• Price target of Rs 1,250
• Strong earnings in Q4FY20
• Reasonable pain upfronted
• Best placed to navigate Covid-19 disruptions
• Strong market share gains, high capital adequacy and increasing efficiency

Stocks To Watch

• Kotak Mahindra Bank: The lender will consider raising of equity capital through private placement, Follow-on Public Offer (FPO) , QIP or through a combination thereof subject to shareholder and regulatory approval at its board meeting on April 22.
• Tata Motors: Jaguar Land Rover retail sales in FY20 fell 12.1 percent compared to last year as a result of the Covid-19 pandemic significantly impacting sales in the fourth quarter. Retail sales for the fourth quarter were down 31 percent to 1,09,869 vehicles year-on-year. It has temporarily suspended production at its facilities outside China.
• Westlife Development: Same Store Sales growth in January and February was 12.3 percent while that for the March quarter was a negative 6.9 percent. The company has investments worth Rs 156 crore in various Mutual Funds and other instruments that can be converted into cash at a short notice. It also has free debt lines worth more than Rs 225 crore available. Cost impacts such as write-offs and wastage to be included in the March quarter results.
• Nalco: The Department of Steel and Mines of the Government of Odisha has issued a Grant Order for lease agreement of the Utkal-D coal block. The block is spread over an area of 301.28 hectares and was allocated to the company in May 2016. The block has an initial capacity of 2 million tonnes per year with total mineable reserves of 101.68 million tonnes.
• Future Group: Bloomberg News reports that the Supreme Court has refused to allow the sale of the pledged shares of group companies. Next hearing to be held on May 4.
• ACC: To resume operations from April 20, in a phased manner.
• JK Cement: Production has become partially operational in Karnataka and Uttar Pradesh.
• Ambuja Cements: Seeks necessary permissions from the relevant Government authorities for resumption of operations at various locations from April 20 in a phased manner.
• Ultratech Cement: Operations at some of the company's locations are being partially resumed.
• Goa Carbon: Resumed operations at the Goa unit from April 19.
• Deepak Nitrite: Partially commences production of some of its other products at its manufacturing facilities in Nandesari, Roha, Taloja and Dahej.
• Century Textiles and Industries: Commences operations for tissue and board production in Uttarakhand.
• Apollo Tyres: Board approved issue of NCDs worth Rs 1,000 crore.
• Indian Hotels: Board approved raising Rs 150 crore from NCDs to Axis Bank. The NCDs will be of face value of Rs 10 lakh and are proposed to be listed on the wholesale debt market segment of the National Stock Exchange. The tenor for the same if three years from the date of allotment.
• Jagran Prakashan: Board approved raising Rs 100 crore via NCDs.
• Laurus Labs: U.S. FDA has approved ANDA for Macitentan. Drug is used to treat pulmonary arterial hypertension.
• South Indian Bank: Revises MCLR across various tenors from April 20. One-Month MCLR now at 8.2 percent and One-Year MCLR now at 8.85 percent.
• Bharti Airtel: Has extended validity of pre-paid packs till May 3 for low income customers. All these customers will now be able to receive incoming calls on their Airtel mobile numbers even after the validity of their plan is exhausted.
• Vodafone Idea: Has announced the extension of incoming services for low income, pre-paid users till May 3. This free of cost extension of incoming service will enable feature phone users of both Vodafone and Idea to continue to receive incoming calls, even if the validity of their plan expires earlier.
• Phoenix Mills: Schroder Group increased stake from to 5.57 percent from 3.7 percent in on April 15.
• General Insurance Corporation: Representative office in Brazil has been upgraded from “occasional reinsurer” to “admitted reinsurer” by Brazilian Superintendence of Private Insurance.
• Religare Enterprises: IRDAI has approved divestment of part of investment of the Company in Religare Health Insurance to Kedaara.
• Cadila Healthcare: Zydus gets final approval from the U.S. FDA from Baclofen Tablets. These tablets are used to treat muscle spasm caused by certain conditions such as multiple sclerosis, spinal cord injuries / diseases. This will be manufactured at the company's Baddi unit.
• Punjab and Sind Bank: Golden Jubilee Hotels Pvt. Ltd., an NPA account of the bank with a book outstanding of Rs 86.40 crore and with 100 percent provisioning has been declared as fraud and reported to the RBI as per regulatory requirement.
• GAIL: Is in readiness to resume construction of various hydrocarbon infrastructure projects of national importance post lifting of the Covid-19 related lockdown. It has also chalked out catch-up plans for various locations with subsidiaries and JV companies to ensure timely completion and avoid any slippages.
• JSPL: CARE Ratings has revised the outlook on bank facilities and NCDs to Under Credit Watch with Negative Implications from Stable. The rating has been maintained at CARE BBB- and CARE A3 for both respectively.
• ICICI Lombard: ICRA has reaffirmed its ICRA AAA rating with a stable outlook on the company's subordinate debt worth Rs 485 crore.
• Shilpa Medicare: Gets Establishment Inspection Report (EIR) from the U.S. FDA for its API manufacturing site located at Raichur. The inspection was conducted from February 3-7, 2020. The inspection classification of this facility is No Action Indicated (NAI).

Earnings Expectations: Infosys Q4FY20

• Dollar revenue seen 0.3 percent lower at $3,234 million, as per a BloombergQuint poll
• Revenue seen 1.6 percent higher at Rs 23,460 crore
• EBIT seen 2 percent higher at Rs 5,164 crore
• EBIT Margins seen at 22 percent from 21.9 percent
• Net profit seen 4.5 percent lower at Rs 4,267 crore
• All estimates barring Dollar revenue are Bloomberg estimates
• All numbers are consolidated and compared on a sequential basis

Key Factors To Watch For Infosys:

• Client payment periods, pricing pressure and discounts
• Outlook on BFSI given current environment
• Ability to service clients under the new environment
• Impact / change in strategy with focus on digital services

Brokerage Radar

Morgan Stanley On JSPL

• Equalweight rating maintained
• Price target of Rs 195
• Expect company to weather Covid-19 challenges
• Ebitda to remain stable sequentially due to some benefit from lifting pre-paid iron ore from Sarda mines
• Improved performance in both international operations and power business

Kotak On Jubilant Foodworks

• Add rating maintained
• Price target cut to Rs 1,800 from Rs 1,900
• Competitive edge likely to come to the fore
• Domino's delivery sales should start picking up much sooner
• Own delivery fleet, brand strength, effective communication should serve as competitive differentiators

HSBC On L&T

• Buy rating maintained
• Price target of Rs 1,000
• Appears to be coping well with Covid-19 disruptions
• Expects execution normalisation by early Q2FY21
• Near-term working capital intensity may worsen due to slower collection, lower execution as well as payables

ICICI Securities On Biocon

• Initiate coverage with buy rating
• Price target of Rs 410
• Biosimilars offer huge growth potential
• Niche and steady research services would continue to provide support to growth and profitability
• Positive on strong growth across business segments, healthy cashflow generation and improving return ratios

Ratings Revisions From S&P Global Ratings

Bulk Deals

• Prataap Snacks: Smaller Cap World Fund sold 2.44 lakh shares (1.04 percent) at Rs 458.08 per share

Pledged Share Details

• GMR Infra: Promoter GMR Enterprises created pledge of 3.75 crore share on March 19
• JSW Steel: Promoter JSW Techno Projects Management revoked pledged of 40.6 lakh shares on April 13
• JSW Energy: Promoter JSW Investments revoked pledge of 82.5 lakh shares on April 13
• Embassy Office Parks REIT: Promoter Embassy Property Developments created pledge of 1 crore units on April 16
• Adani Transmission: Promoter Adani Tradeline revoked pledge of 1 lakh shares on April 15

(As Reported On April 17)

Trading Tweaks

• Price Band Revised To 20 Percent From 10 Percent: CARE Ratings
• Price Band Revised To 5 Percent From 10 Percent: ITDC, JMC Projects, Omax Autos, State Trading Corporation of India
• Price Band Revised To 10 Percent From 20 Percent: Birla Cables, GTPL Hathway, Munjal Auto, NBCC, Mangalore Chemicals and Fertilisers, Pricol, Texmaco Rail, Walchandnagar Industries
• Move Into ASM Framework: Kaya, Titagarh Wagons, Walchangnagar Indutries, Rane Engine Valve, NACL Industries, Reliance Power, Shakti Pumps
• Move Out Of ASM Framework: Mercator, GFL, GTL Infrastructure, Jaiprakash Power Ventures
• Move Into Short-Term ASM Framework: IFB Agro, LT Foods, GATI, Greaves Cotton, Balaji Amines, Ashoka Buildcon, Uniply Industries, ITD Cementation, NCL Industries, VA Tech Wabag, Ashapura Minechem, IRB Infra, Dilip Buildcon, Shilpa Medicare, PNC Infratech, Time Technoplast, Firstsource Solutions, Jain Irrigation

F&O Cues

• Nifty April futures end at 9,311; a premium of 44.6 points Vs 42.6 points
• Nifty April futures add 1 percent in Open Interest and 1.1 lakh shares
• Nifty Bank April futures end at 20,748.8; a premium of 67.4 points
• Nifty Bank April futures shed 16 percent in Open Interest and 2 lakh shares
• Nifty Put-Call Ratio at 1.37 Vs 1.39 across all series

Nifty: April 23 Expiry

• Maximum Open Interest on Call side at 10,000 strike (9.7 lakh shares)
• Maximum Open Interest on Put side at 9,000 strike (11 lakh shares)
• 9,000 Put (5.8 lakh shares), 8,800 Put (4.2 lakh shares) and 10,000 Call (4.1 lakh shares) see addition in Open Interest.

Nifty: April 30 Expiry

• Maximum Open Interest on Call side at 10,000 strike (16.1 lakh shares)
• Maximum Open Interest on Put side at 8,000 strike (24.9 lakh shares)