All You Need To Know Going Into Trade On August 18

Stocks To Watch

• Bandhan Bank: RBI removes regulatory restrictions after bank complies with promoter shareholding norms. The restrictions on the CEO's pay have now been lifted while those on prior approval for new branches were lifted earlier.
• Telecom stocks: AGR dues case continues in the Supreme Court today.
• RBL Bank: To consider raising of funds by issuing equity shares on a preferential basis on August 20.
• Covid-19 Impact On Delta Corp: Temporary suspension of operations has had an impact on the revenue of casino and hospitality business but the online skill gaming business continues to operate and grow, the company said. Normalcy could be gradually restored during the financial year ending March 2021.
• Triveni Engineering: Approved Rs 65 crore buyback through the tender offer process at a price of Rs 105 per share. Buyback price is a 42% premium to Monday’s closing price.
• VRL Logistics: Bloomberg News reports that the company which owns the largest fleet of commercial vehicles in India will not buy new trucks and will get rid of old ones to rein in repair costs amid a nascent recovery in demand.
• Cholamandalam: Sees light CV demand to bounce back from the third quarter of FY21. The company says it is focussed on financing tractors, as per Bloomberg.
• DCB Bank: RBI approved the re-appointment of Nasser Munjee as Non-Executive Part-Time Chairman, for a further period of one year from August 19, 2020.
• Reliance Communications: Bloomberg quotes a company lawyer saying UV ARC plans to take over company and monetise assets. Lenders to get Rs 15,140 crore of bonds redeemable in 3-5 years.
• SBI Cards: Raises Rs 500 crore via 5.75% 2023 bonds.
• Canara Bank: To exercise the call option for the redemption of 8.62% unsecured, redeemable, subordinate, non-convertible upper tier-II bonds series III amounting to Rs 1,000 crore subject to approval from RBI. Sets August 28 as the record date for the purpose of ascertaining the name of bondholders eligible to receive the interest or principal due on the bonds.
• Tata Steel: Fixes August 28 as the record date for redemption of commercial papers worth Rs 1,150 crore.
• Punjab National Bank: ICRA Ratings has assigned the lender's Basel-III compliant Tier-II bonds a ICRA AA- rating with a stable outlook. It has also assigned a similar rating to the lender's infrastructure bonds worth Rs 3,000 crore. The instruments were originally issued by the erstwhile Oriental Bank of Commerce which is now merged with PNB.
• Reliance Home Finance: The Delhi High Court has directed that placing the company's and Reliance Commercial Finance's account in the category of 'fraud' shall be kept in abeyance. No step prejudicial to the interest of the company shall be taken till the next hearing on September 29, 2020. A writ petition was filed by the company challenging the wrongful action of Bank of Baroda, the lender and lead bank of the consortium, of classifying the company's account as fraud.
• Quess Corp: To disinvest 100% stake in its wholly-owned subsidiary Dependo Logistics Solutions Private Limited in an all-cash deal worth Rs 10 crore. The transaction is expected to be completed by August 20.
• Nifty Earnings Today: Zee Entertainment
• Non-Nifty Earnings Today: FACT, Hindustan Aeronautics, Indo Count Industries, JK Cement, KNR Constructions, Uflex

Earnings Reported After Market Hours

Petronet LNG Q1FY21

• Revenue down 43% to Rs 4,883.5 crore
• Net profit down 7% to Rs 520.2 crore
• Ebitda down 11% to Rs 909.9 crore
• Ebitda margin at 18.6% from 11.9%
• All numbers are standalone and compared on a year-on-year basis

Orient Paper Q1FY21

• Revenue down 46% to Rs 81 crore
• Net loss of Rs 17 crore from net profit of Rs 8 crore
• Ebitda loss of Rs 16 crore from Ebitda gain of Rs 18 crore
• All numbers are standalone and compared on a year-on-year basis

Brokerage Radar

CLSA On NTPC

• Buy rating maintained
• Price target of Rs 140
• Significant scale-up in renewables ahead but at right profitability
• On track to retrofit 81% of its total coal capacity to desulphurise flue gases
• Core story remains intact and robust
• Manpower efficiency improving with revenue per employee rising 34% during FY18-20
• Trading two standard deviations below its 6.2x one-year forward PE

CLSA On Voltas

• Downgrade to outperform from buy
• Price target raised to Rs 670 from Rs 560
• Market share gains in UCP and traction in Voltbek JV some key positives
• Managed to arrest topline decline with better execution
• Voltbek JV breakeven likely to be achieved ahead of guided timeline
• Price run-up in the last three months capture most of the tailwinds
• Downgrade as we see limited upside

Investec On Varroc Engineering

• Buy rating maintained
• Price target raised to Rs 315 from Rs 265
• Weak India business and VLS offset by sharp recovery in China JV
• Encouraging outlook with uptick in global PV volumes
• OEMs should drive a sharp earnings recovery in FY23
• Valuations offer a favourable risk-reward

Macquarie On HPCL

• Outperform rating maintained
• Price target of Rs 400
• Witnessed a V-shaped recovery in oil products demand
• Refining capacity on a consolidated basis will expand to 45 MTPA in FY23-24 from the current 27 MTPA
• Pushing ahead with refinery projects despite poor macro backdrop
• Expect group GRMs to improve by $3 per barrel versus $1 in FY20
• Continue to see deep value in Indian oil marketing companies
• HPCL is a preferred name among OMCs.

Morgan Stanley On Petronet LNG

• Overweight rating maintained
• Price target of Rs 321
• Earnings beat on better-than-expected volumes
• Demand has recovered to pre-Covid levels, implying start of an upgrade cycle
• Higher demand from fertiliser plants and refineries negated weakness in city gas demand

Citi On Voltas

• Buy rating maintained
• Price target raised to Rs 720 from Rs 640
• Raise target multiple to 38x from 35x on continued market share gains
• Q1 reflects strong competitive position in Indian room AC industry
• UCP Ebit margins rose despite 60% fall in revenue

Nomura On Berger Paints

• Neutral rating maintained
• Price target of Rs 540
• Management remains upbeat on growth outlook for Q2 and Q3 of FY21
• Demand in August has risen for premium / luxury products
• Auto coating segment continues to see sales decline
• Expect upcoming festive season to aid demand recovery
• Maintain FY20-23F EPS CAGR of 13%
• Prefer Asian Paints over Berger given its rich valuations

Who’s Meeting Whom

• V-Guard: To meet ICICI Prudential on August 18 and Nirmal Bang Securities on August 19-20.
• Balkrishna Industries: To meet Citigroup Global Markets (India) on August 18.
• Tech Mahindra: To meet Edelweiss India on August 18, Goldman Sachs on August 19 and Investors on August 20 and 21.
• Emami: To meet Edelweiss India on August 18, Kotak Consumer on August 19 and Motilal Oswal on Sepember 2.

Bulk Deals

• CG Power: Singularity Holding acquired 35 lakh shares or 0.6% stake at Rs 13.95 per share. Blue Diamond Properties acquired 4.12 crore shares or 6.6% stake at Rs 13.97 per share. L&T Finance Holdings sold 5.26 crore shares or 8.4% stake at Rs 13.95 per share.
• McLeod Russel: IndusInd Bank sold 22 lakh shares or 2.1% stake at Rs 17.78 per share.
• Rushil Decor: Aspire Emerging Fund sold 75,000 shares or 0.5% stake at Rs 105 per share.

Trading Tweaks

• Circuit Filters Revised: Redington India’s circuit revised to 10% from 20%. Hind Rectifiers circuit revised to 5% from 10% while Vimta Labs’ circuit revised to 5% from 20%.
• AGM Date: Indorama Synthetics, United Breweries, Can Fin Homes, Alkem Lab, Bharti Airtel, Kotak Mahindra Bank, Oracle Financial Services, Somany Ceramics.
• Move Into ASM Framework: Jindal Stainless (Hisar), Balaji Amines, Bartronics, Reliance Naval and Engineering.
• Move Into Short Term ASM Framework: Nitco, Dynamatic Technologies
• Move Out Of Short Term ASM Framework: Sunteck Realty, OnMobile Global, Marksans Pharma

Money Market Update

• The currency ended at 74.88 against the U.S. Dollar as compared to Friday's close of 74.90.
• The currency managed to outperform six of its peers in Monday's trading session.

F&O Cues

• Nifty August futures closed at 11,281; premium of 34 points versus premium of 8 points
• Nifty August futures open interest up 0.03%, adds 3,400 shares in open interest
• Nifty Bank August futures closed at 21,785; premium of 84 points versus discount of 10 points
• Nifty Bank August futures open interest down 8%, sheds 1.2 lakh shares in open interest
• Nifty Put-Call Ratio at 1.51
• Enter F&O Ban: JSPL, Sun TV
• Stocks In F&O Ban: Ashok Leyland, Aurobindo Pharma, Bata India, BHEL, Glenmark Pharma, Vodafone Idea, JSPL, Manappuram Finance, SAIL, Sun TV and Vedanta

Nifty Weekly Expiry: August 20

• Maximum Open Interest on Call side at 11,500 strike (26.4 lakh shares)
• Maximum Open Interest on Put side at 11,000 strike (26.8 lakh shares)
• Active Options: 11,200 Put (9.9 lakh shares) and 11,800 Call (-10.4 lakh shares)

Nifty Monthly Expiry: August 27

• Maximum Open Interest on Call side at 11,500 strike (21.4 lakh shares)
• Maximum Open Interest on Put side at 11,000 strike (36.8 lakh shares)