All You Need To Know Going Into Trade On April 5
Equity markets in Japan along with the MSCI Asia Pacific gauge have opened higher at the start of the new trading week. Investors weigh an unexpectedly strong U.S. jobs report and the sustainability of the recent bond market sell-off.
Markets in China, Hong Kong and Australia are closed on account of the Easter break.
Oil prices traded lower as OPEC+ decided to boost production and Saudi Arabia raised prices for shipments to Asia.
The Singapore-traded SGX Nifty, an early indicator of the Nifty 50 Index’s performance in India, fell 0.2% to 14,961, as of 6:55 a.m.
Let’s take a look at the factors that may influence equities in today’s session:
- Futures on the Dow Jones are trading with gains of 200 points. The index rose 0.5% on Thursday.
- “We are not doubting the market’s expectations of strong U.S. economic momentum,” said Eric Robertsen, chief strategist at Standard Chartered Bank, in a client note. “But the market has also priced in much of the good news up front.”
- U.S. President Joe Biden's top national security and economic advisers plan to meet on April 12 with semiconductor and auto companies to discuss the global shortage of microprocessors, people familiar with the matter told Bloomberg.
- Yields on the 10-year treasuries stood at 1.7%.
- West Texas Intermediate crude fell 0.3% to $61.3 per barrel while Gold traded at $1,727/Oz.
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Stocks To Watch
- Wipro: Completes takeover of METRO-NOM GMBH and METRO systems Romania for a purchase consideration of 52.04 million Euros.
- Tata Motors: Has completed the sale of its Defence business to Tata Advanced Systems Ltd. for an upfront consideration of Rs 227.7 crore. The transfer has been completed on a slump sale basis. The consolidation will yield benefits in the form of operational and financial synergies helping deliver better value for both the entities.
- HDFC: To create a special situations platform by HDFC Capital Advisors Ltd., a wholly-owned subsidiary which will seek to purchase inventory and provide last-mile funding for under construction residential projects across India. The company in a separate exchange filing said that individual loan business continued to see strong improvement during the quarter. The company assigned loans worth Rs 7,503 crore to HDFC Bank as compared to Rs 5,479 crore during the same period last year. Individual loans sold in the preceeding 12 months amounted to Rs 18,980 crore Vs Rs 24,127 crore.
- SAIL: Recorded best ever quarterly performance in production and sales during Q4FY21. Crude steel production up 6% to 4.55 MT from 4.31 MT year-on-year while sales rose 14% to 4.27 MT from 3.74 MT year-on-year. The company saw its best ever annual sales of 14.87 MT in FY21. The company has reduced its gross debt by around Rs 16,150 crore and currently stands at Rs 35,330 crore as of March 31, 2021.
- National Fertilisers: Reported highest ever total fertiliser sale of 59.36 lakh MT in FY21. Other than fertilisers, the company saw steep growth in the sale of seeds and agrochemicals. Seed sales rose 35% while agrochemical sales saw a growth of 95% from last year. Sale of Bentonite Sulphur saw growth of 150% to 19,958 MT.
- NTPC: Unit-2 of 660 MW capacity fo Nabinagar Super Thermal Power Project (3X660 MW) of Nabinagar Power Generation Co. Ltd., a wholly-owned subsidiary has successfully completed trial operations and has been included in the installed capacity of the NTPC group. The total installed capacity of the NTPC group with this inclusion is now at 65,150 MW.
- NMDC: Prices of lump ore raised by 9.3% to Rs 5,850 per tonne while prices of fines raised by 5.8% to Rs 4,560 per tonne. Prices were revised higher on March 20, 2021 as well.
- Britannia Industries: Declares interim dividend of Rs 62 per share. Record date for the same fixed at April 10, 2021.
- Parag Milk Foods: Board approved preferential allotment of 67.56 lakh equity shares at a price of Rs 111 to International Finance Corporation for a total consideration of Rs 75 crore. The board also approved allotment of 45.04 lakh equity shares at Rs 111 each to Sixth Sense Ventures for a total consideration of Rs 50 crore. The board also approved preferential allotment of 50 lakh convertible share warrants to promoters on a preferential basis at a price of Rs 111 per warrant for a total consideration of Rs 111 crore. It will also issue unlisted, unsecured, unrated foreign currency convertible bonds (FCCBs) worth $11 million on a private placement basis to International Finance Corporation at a conversion price of Rs 145 per share after a period of five years.
- Adani Enterprises: Gets Letter of Award from NHAI for development of six lane Badakumari-Karki section of NH-130-CD Road under the Raipur-Visakhapatnam Economic Corridor in Odisha on a Hybrid Annuity basis. The bid project cost for the same is Rs 1,169.1 crore. With this, the Adani Group will have a total of ten NHAI road projects under HAM, ToT and BoT basis in eight states. In a separate exchange filing, the company has been awarded the Letter of Acceptance from Maharashtra State Power Generation Company for a Coal Mining Agreement for Gare Palma Sector II Coal Mine at Raigarh. The contract period will be for a period of 34 years.
- Jaiprakash Power Ventures: In-line with the company's endeavor to reduce its debt, the company ha pre-paid its long-term / working capital loans amounting to Rs 299.51 crore. Pre-payments were made through the sale proceeds of the company's 74% stake in Jaypee Powergrid Ltd. Also, CRISIL and ACUITE have assigned rating of BBB- on the company's bank facilities with a stable outlook.
- NCC: Received two new orders worth Rs 530 crore in March. Of these, orders worth Rs 342 crore pertain to the irrigation division while the other order worth Rs 188 crore pertains to the buildings division. Orders are received from state government agencies.
- Bharat Road Networks: Inks deal for complete transfer of ownership in an operating toll road project from Ghaziabad to Aligarh on NH34. The deal will be done at an enterprise value of Rs 1,600 crore.
- Tata Power: Has acquired 51% stake in TP Northern Odisha Distribution Ltd. for Rs 191.25 crore. TPNODL has been vested the license to carry out the function of distribution and retail supply of electricity covering circles of Balasore, Bhadrak, Baripada, Jajpur and Keonjhar in Odisha for a period of 25 years from April 1, 2021.
- Dixon Technologies: Has incorporated two wholly-owned subsidiaries Dixon Electro Manufacturing Pvt. Ltd. and Dixon Technologies Solutions Pvt. Ltd. for business purposes.
- IL&FS Transportation Networks: Completes stake sale in China Road Asset to China Merchants & PingAn Infrastructure Phase 1 Equity Investment Fund - a fund jointly owned by PingAn Insurance and China Merchants. The company has received a consideration of Rs 1,035 crore from the same. The consideration will be used to pay nearly $88 million worth of loans of Bank of Baroda and the balance will be used to meet the liabilities of IIPL, including bondholders under IOPL. Also, the company's subsidiary Kiratpur Ner Chowk Expressway Ltd. has entered into a settlement agreement with NHAI for foreclosure of the project at a compensation of Rs 672.62 crore.
- Jammu & Kashmir Bank: Government of Jammu & Kashmir committed to infuse up to Rs 500 crore in the bank. The board will discuss the capital infusion at its board meeting.
- V-Mart Retail: The company has opened six new stores - four in Uttar Pradesh, one in Bihar and one in Rajasthan. With that, the total number of stores now at 279.
- L&T Technology Services: Amit Chadha takes charge as MD & CEO of the company.
- Bajaj Electricals: The company has announced lay-offs at its manufacturing unit in Shikohabad in Uttar Pradesh as per the Industrial Disputes Act, 1947.
- IRCTC: Services of Mumbai-Ahmedabad Tejas Express suspended for one month owing to rising coronavirus cases.
March Auto Sales
- Bajaj Auto: Overall sales up 52% at 3,69,448 units Vs 2,42,575 units. Domestic sales up 70% at 1,98,551 units Vs 1,16,541 units while exports up 36% at 1,70,897 units Vs 1,26,034 units.
- TVS Motor: Overall sales at 3,22,683 units Vs 1,44,739 units. Total two-wheeler sales at 3,07,437 units Vs 1,33,988 units. Motorcycle sales at 1,57,294 units VS 66,673 units. Exports at 1,19,422 units Vs 50,197 units. An increase in motorcycle sales in the international market contributed to the rise in exports. Three-wheeler sales at 15,246 units Vs 10,751 units.
- Hero MotoCorp: Overall sales at 5,76,957 units Vs 3,34,647 units. Motorcycle sales at 5,24,608 units Vs 3,05,932 units. Scooter sales at 52,349 units Vs 28,175 units. Exports at 32,617 units Vs 17,962 units.
- Eicher Motors: Total Royal Enfield sales at 66,058 units Vs 35,814 units. Exports at 5,885 units Vs 3,184 units.
Numbers are not comparable on a year-on-year basis owing to sales being impacted in the base quarter due to the coronavirus outbreak and BS-VI transition.
Nomura On India's Second Covid Wave
- New infections in the second wave can surpass the previous peak
- Mortality rate is much lower, lockdown measures are less draconian and is being countered by an aggressive vaccination campaign
- Estimate India is on track to vaccinate 40-45% of its population by end of 2021 higher than our 30% forecast
- Expect medium-term impact to be negligible
- Expect RBI to maintain the policy status quo on April 7, both on rates as well as stance, although we expect to refresh its forward guidance
Emkay On Persistent Systems
- Maintains buy rating
- Price target raised to Rs 2,200 from Rs 1,800
- On track to achieve $1 billion revenue milestone by FY25
- Technology services business likely to sustain a 3.5-5% CQGR in the medium-term
- Has over $250 million cash on the books and is actively pursuing M&A to augment its domain capabilities, digital offerings and expand its presence in Europe
- Raise earnings estimates by 9.8%/10.8% over FY22/23 considering strong revenue growth momentum and low amortisation charges
Motilal Oswal On JSW Steel
- Maintains buy rating
- Price target raised to Rs 610 from Rs 435
- Remains the best volume play in the sector
- Dolvi expansion to drive strong volume growth
- BPSL acquisition to be EPS accretive
- Cash flows to take care of capex and debt reduction
- Raise FY22/23E Ebitda estimates by 21%/23% on better price outlook
- Valuations are reasonable
Pledge Share Details
- Adani Transmission: Promoter Group revoked pledge of 5.92 lakh shares on March 30.
- Adani Ports And Special Economic Zone: Promoter Group revoked pledge of 41.37 lakh shares on March 30.
- Apollo Hospitals Enterprise: Promoter K Reddy revoked pledge of 20,916 shares on March 31.
- Asahi India Glass: Promoter Sanjay Labroo created a pledge of 5 lakh shares on March 26.
- Emami: Promoter Sneha Gardens revoked pledge of 20 lakh shares on March 30.
- JSW Steel: Promoter Siddeshwari Tradex created a pledge of 3.50 lakh shares on March 26. Promoters JSW Techno Projects Management, Sahyog Holdings, Vividh Finvest and JTPM Metal Traders revoked pledge of 1.71 crore shares between March 25-30.
- JSW Energy: Promoters Siddheshwari Tradex, Indusglobe Multiventures and JSW Investments revoked pledge of 5.42 crore shares between March 26-30.
- Max Financial Services: Promoter Max Ventures Investment Holdings revoked pledge of 31.17 lakh shares between March 26-31.
- Steel Strips Wheels: Promoter Dheeraj Garg created a pledge of 5 lakh shares on March 30.
As reported on April 1.
- EPL: Vanguard FTSE All World ETF bought 16.43 lakh shares (0.52%) at Rs 240 per share.
- Seamec: Nomura Singgapore bought 2.50 lakh shares (0.98%) at Rs 449.96 per share.
- Wheels India: Standard Chartered MF sold 5.70 lakh shares (2.37%) at Rs 452 per share.
- Bajaj Healthcare: Escorp Asset Management sold 1.95 lakh shares (1.41%) at Rs 442.40 per share. Shri Ravindra Media Ventures sold 70,000 shares (0.51%) at Rs 441.70 per share.
- Ex-Date Interim Dividend: Saregama India, SBI Life Insurance Company, Shriram Transport Finance Company
- Record Date Interim Dividend: RailTel Corporation of India
- Move Into Short-Term ASM Framework: RattanIndia Infrastructure, Future Lifestyle Fashions
- Move Out Of Short-Term ASM Framework: Best Agrolife
- ADF Foods: Promoter Mahalaxmi Thakkar sold 5,022 shares between March 30-31.
- Greenply Industries: Promoter Rajesh Mittal & Sons, HUF bought 34,200 shares on March 31.
- J Kumar Infraprojects: Promoters bought 1.04 lakh shares between March 30-31.
- Power Mech Projects: Promoter's immediate relative bought 33,521 on March 31.
- Raymond: Promoter JK Investors (Bombay) bought 45,000 shares on March 31.
- Vardhman Special Steels: Promoter Sachit Jain bought 7,000 shares between March 30-31.
- West Coast Paper Mills: Promoter Kilkotagiri & Thirumbadi Plantations bought 39,739 shares between March 30-31.
Money Market Update
- The rupee ended flat at 73.11 against the U.S. Dollar on Thursday.
- Nifty April futures ended at 14,936; premium of 71 points
- Nifty April futures shed 5.8% and 8,783 shares in Open Interest
- Nifty Bank April futures ended at 34,179; premium of 321 points
- Nifty Bank April futures shed 14.6% and 14,022 shares in Open Interest
- Nifty Put-Call Ratio at 1.66
- Stocks In F&O Ban: SAIL