All You Need To Know Going Into Trade On Feb. 4
Asian stocks opened mixed Tuesday after modest U.S. gains as investors weighed efforts to contain the coronavirus, while oil retained a sharp decline.
Equity benchmarks dipped at the open in Tokyo, rose in Seoul and were flat in Sydney. Futures in Hong Kong gained, though China faces another tough session after many stocks traded limit-down on Monday. U.S. futures were little changed. The Singapore-traded SGX Nifty, an early indicator of NSE Nifty 50 Index’s performance in India, rose 0.24 percent to 11,736 as of 6:55 a.m.
Short on time? Well, then listen to this podcast for a quick summary of All You Need To Know before the opening bell.
Here’s a quick look at all that could influence equities today
- Oil extended its sharp decline to below $50 a barrel as traders weigh the impact on global demand from the spread of coronavirus, which has probably cut China’s oil consumption by 20 percent.
- The S&P 500 Index advanced as China added stimulus in an effort to shore up its economy and American manufacturing data topped estimates.
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Earnings Reaction To Watch
Deepak Nitrite (Q3, YoY)
- Revenue rose 46.1 percent to Rs 1,119.9 crore
- Net profit rose 3.9 times to Rs 156.7 crore
- Ebitda rose 2.4 times to Rs 258.3 crore
- Margin stood at 23.1 percent versus 14 percent
- Raw material cost as percentage of sales at 58 percent
- Phenolic segment revenue rose 70 percent to Rs 535.1 crore
- Basic chemical segment revenue rose 15 percent to Rs 252.7 crore
- Fine & Speciality chemical segment revenue rose 17 percent to Rs 173.2 crore
GlaxoSmithKline Pharmaceuticals (Q3, YoY)
- Revenue fell 5.7 percent to Rs 778.6 crore
- Net loss stood at Rs 661.2 crore versus net profit at Rs 113.7 crore
- Ebitda fell 9.3 percent to Rs 124.4 crore
- Margin stood at 16 percent versus 16.6 percent
Shriram Transport Finance (Q3, YoY)
- Net profit rose 38.1 percent to Rs 882.2 crore
- Net Interest Income fell 1 percent to Rs 2,014.4 crore
- Impairment cost fell 30 percent to Rs 444.4 crore
- Assets under management rose 4.93 percent to Rs 108,931.4 crore
Affle (India) (Q3, YoY)
- Revenue rose 27.4 percent to Rs 94.5 crore
- Net profit rose 31.9 percent to Rs 21.5 crore
- Ebit rose 18.1 percent to Rs 24.1 crore
- Margin rose 25.5 percent to 27.5 percent
- India segment revenue rose 53 percent to Rs 53 crore
- International segment revenue rose 4 percent to Rs 43.3 crore
AstraZeneca Pharma (Q3, YoY)
- Revenue rose 4 percent to Rs 223.9 crore
- Net profit fell 8.2 percent to Rs 26.7 crore
- Ebitda fell 9.8 percent to Rs 36.9 crore
- Margin stood at 16.5 percent versus 19 percent
SRF (Q3, YoY)
- Revenue up 2.3 percent to Rs 1,850.5 crore
- Net profit up 2.1 times to Rs 343 crore
- Ebitda rose 25.1 percent to Rs 390.2 crore
- Margin stood at 21.1 percent versus 17.2 percent
- Tax reversal of Rs 66 crore aided bottom line numbers
- Raw material cost as percent of sales stood at 50.4 percent versus 56.7 percent
- Technical textiles business revenue fell 26 percent to Rs 335.7 crore
- Chemical business revenue rose 39 percent at Rs 811.9 crore
- Packaging films business revenue fell 9 percent to Rs 638.2 crore
Ujjivan Financial Services (Q3, YoY)
- Net interest income rose 46.1 percent to Rs 445.9 crore
- Net profit rose 2.3 times to Rs 72 crore
Nifty Earnings To Watch
- Adani Ports and Special Economic Zone
- Bharti Airtel
Earnings To Watch
- TVS Motor
- Tata Global Beverages
- Piramal Enterprises
- JSW Energy
- Punjab National Bank
- Exide Industries
- Firstsource Solutions
- Praj Industries
- Action Construction Equipment
- Adani Green Energy
- Apollo Pipes
- Artemis Medicare Services
- Avanti Feeds
- Bajaj Electricals
- Balmer Lawrie
- CSB Bank
- Dhanlaxmi Bank
- Grindwell Norton
- Indo Count Industries
- J.B.Chemicals & Pharmaceuticals
- Jindal Saw
- Liberty Shoes
- NRB Industrial Bearings
- Oracle Financial Services Software
- Shipping Corporation Of India
- TCI Finance
- Mahindra Logistics
Stocks To Watch
- Tata Consultancy Services has expanded partnership with Walgreens Boots Alliance for digital solutions for 10 years. The contract is valued at $1.5 billion. Walgreens Boots Alliance owns pharma manufacturing, wholesale and distribution companies.
- Manappuram Finance: Baring India Private Equity Fund II is offering 4.2 crore shares (5 percent) of the company in an accelerated book-building with a floor price of Rs 172 per share, which is at a discount of 6.57 percent to the last closing prices. Baring Fund has 8.76 percent stake in the company as per latest exchange filings, according to Bloomberg report.
- Power Grid: The government’s holding in the company has reduced from 53.03 percent to 49.08 percent on Jan. 28.
- SRF: The board has approved a project to de-bottleneck the hydrofluorocarbon capacity at Dahej for Rs 65.5 crore and setup dedicated facilities to produce intermediates catering to the agro-chemicals segment for Rs 238 crore.
- GMR Infra’s arm GMR Hyderabad International has signed an agreement to operate Bidar airport.
- JK Cement has commissioned two grey cement grinding capacity plants with a combined capacity of 2.5 metric tonnes per annum and commenced the commercial dispatches.
- National Peroxide said that its Kalyan plant has commenced operation with effect from Feb. 2.
- Thyrocare Technologies said that its two centres at Surat and Baroda have been closed due to unfair business practices by the franchisee.
- V-Mart has opened three new stores in Madhya Pradesh and Uttar Pradesh. The company also said that it closed one store in Odisha.
- Punjab National Bank: The board has approved raising up to Rs 1,000 crore via issue of bonds.
- ITI to consider FPO issue price on Feb. 6
- M&M Financial Services to consider raising capital via bonds on Feb. 6.
- Kohinoor Foods has made an upfront payment towards a one-time settlement to Oriental Bank of Commerce.
- Baring India offers 4.2 crore Manappuram Finance shares: Terms
- India’s ITI FPO after again extends offer period until Feb. 5, have received 57 percent demand on seventh-day sale Tuesday
- India’s Stove Kraft files for IPO.
Nomura on Affle India
- Maintained ‘Buy’ with a price target of Rs 1,900.
- December quarter review: Good execution in a challenging quarter.
- Segmental metrics were comforting, with growth driven by cost per converted user business.
- Q4 growth likely to improve led by a weaker base and spread-out demand.
Nomura on Amara Raja Batteries
- Maintained ‘Neutral’; hiked price target to Rs 793 from Rs 712.
- Strong December quarter results; expect steady performance.
- Exports growth continues to drive replacement.
- With fall in lead prices by about 8 percent on a sequential basis, expect higher margins to be sustained.
Morgan Stanley on Shriram Transport
- Maintained ‘Overweight’ with a price target of Rs 1,365
- Big beat driven by asset quality surprise.
- Credit costs were much lower than estimates due to sharply lower NPA formation.
- RoE hit 20 percent in the third quarter; decadal low valuation is attractive.
UBS on Shriram Transport
- Maintained ‘Buy’ with a price target of Rs 1,650.
- December quarter review: Stable GNPLs driving lower credit costs.
- Sharp decline in credit costs driving large EPS beat.
- Decline in wholesale rates to aid margins; asset quality to remain stable.
Prabhudas Lilladher on Dr Lal PathLabs
- Maintained ‘Hold’; hiked price target to Rs 1,797 from Rs 1,437.
- Rest of India drives growth while Delhi-NCR muted due to exogenous factors.
- Management targets western India, Maharashtra for expansion in non-core region.
- Expect competitive intensity to remain strong with price war.
Nomura on AIA Engineering
- Maintained ‘Neutral’; hiked price target to Rs 1,980 from Rs 1,895.
- Strong Q3 on lower ferrochrome prices and currency depreciation.
- Expect strong Ebitda margin recovery in 2020-21 on improved mix and weak rupee.
- Maintain cautious stance on valuations.
- Morgan Stanley: Cement prices increased across regions by around 4-5 percent
- Goldman Sachs: Prices hikes have been taken in various regions of Rs 15-25 per bag cumulatively in the month of January.
- Goldman Sachs: Another attempt to increase prices by Rs50-60 per bag in several regions in South India in last 1-2 days.
- Astra Microwave Products: Texmaco Infrastructure & Holdings acquired 10 lakh shares (1.15 percent) at Rs 91.37 each
- JBF Industries to move into ASM framework
- Suven Life Sciences, Omax Autos to move into short term ASM framework
- India Nippon Electricals to move out of short term ASM framework
- Transglobe Foods price band revised to 10 percent
- Paisalo Digital price band revised to 5 percent
- Sterling and Wilson Solar, Jindal Stainless (Hisar), Adani Transmission, Mastek, Sequent Scientific, Hindustan Construction to move into surveillance measure in respect of high promoter pledge network
- Max India and GMR Infra to move out of surveillance measure in respect of high promoter pledge network.
Who’s Meeting Whom
- Shoppers Stop to meet Soros Capital on Feb. 10.
- MCX to meet Enam AMC, Hermes Investment Management and other investors from Feb. 4-11.
- KRBL promoters acquired 22,500 shares on Feb. 3
(As Reported On Feb. 3)
Money Market Update
The rupee remained unchanged at Rs 71.35 against the dollar versus Rs 71.35 against the dollar on Friday.
- Nifty February futures closed at 11,703 discount of 4.7 points versus 6.9pts
- Nifty February futures open interest was down 0.6 percent, sheds 81,000 shares in open interest
- Nifty Bank February futures closed at 30,032 premium of 8.9 points versus 52 points
- Nifty Bank futures open interest down 4 percent, sheds 59,000 shares in open interest
- Nifty PCR at 0.95 versus 0.85 (across all series)
Nifty Weekly Expiry: Feb. 6
- Max OI on call side at 12,000 (31.5 lakh shares)
- Max OI on put side at 11,500 (23.3 lakh shares)
- OI addition seen at 11,800C (+9.3 lakh shares), 11,500P (+8.3 lakh shares), 11,600P (+5.7 lakh shares)
Nifty Monthly Expiry: Feb. 27
- Max OI on call side at 12,500 (20.7 lakh shares)
- Max OI on put side at 12,000 (23.5 lakh shares)