All You Need To Know Going Into Trade On February 18
Asian stocks are mixed this morning but mostly trade with a negative bias. Treasury yields are steady after pulling back from a one-year high, while Brent Crude crossed the $65 per barrel mark.
Benchmark indices fell in Japan and South Korea while Australia's benchmark fluctuates.
China's markets reopen after the Lunar New Year break. The U.S. Dollar fell while Bitcoin rose past the $52,000 mark.
The Singapore-traded SGX Nifty, an early indicator of the Nifty 50 Index’s performance in India, rose 0.4% to 15,259 as of 7:05 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.
Let’s take a look at the factors that may influence equities in today’s session:
- Futures on the Dow Jones are trading 70 points higher. The index ended with gains of 0.3% on Wednesday.
- Brent crude is past $65 per barrel while West Texas Intermediate rose close to $62 per barrel as the deep freeze caused historic power outages across the central U.S. Crude output in the country has plunged by a third with traders suggesting that production of nearly four million barrels per day is now offline.
- U.S. retail sales in January rose by the most in seven months, beating all forecasts, according to Commerce Department data. Factory output too rose more than expected.
- FOMC minutes suggested that Fed officials did not see the conditions for reducing their asset-purchase program being met for 'some time' at their January policy meet.
- Yield on the 10-year treasuries stood at 1.27%.
- Gold was little changed at $1,777.2/Oz - the lowest in nearly eight months.
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Stocks To Watch
- Bharti Airtel: To acquire 20% stake in its DTH arm Bharti Telemedia from an affiliate of Warburg Pincus for about Rs 3,126 crore. The Warburg Pincus affiliate, Lion Meadow Investment, had acquired 20% equity stake in Bharti Telemedia for Rs 2,310 crore in 2018 after the announcement of deal in December 2017. The transaction will involve issuance of about 3.64 crore equity shares of Airtel at a price of Rs 600 per share and up to Rs 1,037.8 crore in cash. The proposed transaction is part of Airtel’s strategy to align the shareholding of its customer facing products, services and businesses under the same holding group. Further Airtel will issue its shares to the Warburg Pincus affiliate at a premium of 0.50% to the floor price determined as per ICDR regulations. The remaining consideration of Rs 937.8 crore will be paid in cash on the closing date of the proposed transaction. There may also be minor customary closing adjustments not exceeding Rs 100 crore.
- IndiaMART InterMESH: Launched its QIP issue on Wednesday in order to raise funds. The floor price of the issue is set at Rs 9,065.61 per share, which is a 6% premium to Wednesday's closing price. The board may offer a discount of 5% on the floor price at its discretion.
- Dish TV India: The Board of Directors granted approval to initiate fund-raising through permissible modes and issue of permissible securities, for an amount of up to Rs 1,000 crore, in one or more tranches. In this regard, the board has constituted a Fund Raising Committee for recommending, taking actions and monitoring in the matters of raising funds.
- Phillips Carbon Black: The company has commissioned two specialty black lines at Palej, in Gujarat for production of wide range of specialty black products totaling about 32,000 MTPA to service the growing needs of its customers.
- Bajaj Electricals: ICRA has revised the long-term rating of the company to A from A- and the short-term rating to A1 from A2+.
- Future Enterprises: Has defaulted on payment of interest of Rs 12.72 crore due on listed NCDs issued by the company.
- Jubilant Foodworks: Appoints Ashish Goenka as CFO from February 17. Goenka was earlier Executive Vice President and Group Finance Controller at Bharti Airtel.
- VA Tech Wabag: Has achieved financial closure for its Hybrid Annuity Model project received from Kolkata Metropolitan Development Authority. The company had signed a Rs 575 crore HAM concession agreement under the Namami Gange programme. The company will execute Engineering, Procurement and Construction portion of this project over 24 months followed by O&M of 15 years. The company has signed an agreement with International Finance Corporation and Tata Cleantech Capital to borrow Rs 176 crore for the project. Further, the company has also signed an investment agreement with Kathari Water Management for the Project. As per the agreement, an amount upto about Rs 71 crores will be jointly invested by the company and Kathari Water Management in one or more tranches, by way of shares, Compulsorily Convertible Preference Shares and NCDs.
- Non-Nifty Earnings Today: Ambuja Cements
Morgan Stanley On State Bank of India
- Maintains overweight rating
- Price target raised to Rs 600 from Rs 525
- Macro backdrop for banks is looking increasingly like the early 2000s
- SBI looks best placed in the current cycle
- Has built a strong retail franchise and sustained deposit market share
- Expect earnings estimate upgrades and significant re-rating as the corporate cycle turns
- Assume >1% RoA in FY22/23 and 1.6x FY23e price-to-book value
- Bull case price target of Rs 765 implies potential upside of nearly 90%
BofA Securities On Bharti Airtel
- Maintains neutral rating
- Price target of Rs 650
- Currently trading at 10x FY22E proportionate Ebitda
- Estimate FY21 DTH Ebida of Rs 2,120 crore
- Do not consider announcements to be material enough for any major stock price movement
- Remain neutral as we find risk-reward to be balanced
Motilal Oswal On Cement
- Demand has improved but pricing remains muted
- Prices in north and west see hikes but those in south and east are declining
- Volumes remain strong; peak season demand kicks in
- Demand in February is up 8-10% year-on-year led by north, central, east and revival in the west
- Demand in South continues to remain weak
- Higher energy cost to be partly offset by operating leverage
- UltraTech, Dalmia Bharat and ACC are the top picks
Pledge Share Details
- Emami: Promoters Sneha Gardens and Sneha Enclave revoked pledge of 4 lakh shares on February 12.
- Steel Strips Wheels: Promoters Dheeraj Garg and DHG Marketing revoked pledge of 2 lakh shares on February 16.
- Asahi India Glass: Promoter Sanjay Labroo revoked pledge of 6.94 lakh shares on February 15.
- Aurobindo Pharma: Promoter Group Axis Clinicals, Trident Chemphar and RPR Sons Advisors created a pledge of 34 lakh shares on February 15.
- JSW Energy: Promoter Indusglobe Multiventures revoked pledge of 2.50 crore shares on February 12.
- Adani Green Energy: Promoter Harmonia Trade and Investment acquired 25 lakh shares on February 16.
As Reported On February 17.
- V-Guard Industries: Promoter Chittilappily Thomas Kochouseph sold 40 lakh shares (0.93%) at Rs 225.01 per share.
- TCNS Clothing Co: Nalanda India Equity Fund bought 43.20 lakh shares (7.02%) at Rs 412.31 per share. Fidelity International Discovery Fund sold 17.43 lakh shares (2.83%) at Rs 402 per share. Fidelity Emerging Asia Fund sold 4.46 lakh shares (0.73%) at Rs 402 per share.
- GMM Pfaudler: Chandler And Price I sold 1.33 lakh shares (0.91%) at Rs 3,833.6 per share.
Who’s Meeting Whom
- DCM Shriram: To meet Aditya Birla Sun Life AMC on February 18.
- Crompton Greaves Consumer Electricals: To meet DSP Mutual Fund on February 19.
- Price Band Revised From 20% To 10%: Adani Total Gas, Bank of India, Bank of Maharashtra
- Ex-Date Income Distribution: Embassy Office Parks REIT
- Ex-Date Buyback: Suprajit Engineering
- Ex-Date Interim Dividend: Man Infraconstruction, Centum Electronics, Clariant Chemicals (India), JB Chemicals & Pharmaceuticals, Mahanagar Gas, Seamec, Suprajit Engineering, Vishal Fabrics
- Record Date Interim Dividend: ESAB India, Everest Organics, Garden Reach Shipbuilders & Engineers, Jamna Auto Industries, Suven Pharmaceuticals
- Record Date Rights Issue: Patel Integrated Logistics
- Record Date Income Distribution: Mindspace Business Parks REIT
- Move Into ASM Framework: Adani Transmission, Kirloskar Industries, Adani Total Gas
- Move Into Short-term ASM Framework: HEG, Optiemus Infracom, Yaarii Digital Integrated Services, Jaiprakash Power Ventures
- Move Out Of Short-term ASM Framework: PNC Infratech, Karur Vysya Bank, SKF India, Harita Seating Systems, Kirloskar Industries
- Indo Rama Synthetics (India): Promoter Urmila Lohia sold 3.35 lakh shares on February 15.
- Kotak Mahindra Bank: Promoter Janak Desai sold 5,000 shares on February 16.
- Asian Granito India: Promoter Kamleshbhai Patel acquired 17,000 shares on February 16.
- Man Infra: Promoter Parag Shah acquired 5 lakh shares on February 16.
- BLS International Services: Promoters Riya Aggarwal and Shikhar Aggarwal acquired 1.15 lakh shares between February 15-16.
As Reported On February 17.
Money Market Update
- The rupee ended at 72.75 against the U.S. Dollar, as compared to Tuesday's close of 72.69.
- Nifty February futures end at 15,190; discount of 18 points
- Nifty February futures add 2.2% and 3,115 shares in Open Interest
- Nifty Bank February futures end at 36,930; premium of 20 points
- Nifty Bank February futures shed 10% and 6,732 shares in Open Interest
- Nifty Put-Call Ratio at 1.32
- Enter F&O Ban: Vodafone Idea, Punjab National Bank
- Stocks In F&O Ban: SAIL, Punjab National Bank, Vodafone Idea