All You Need To Know Going Into Trade On June 10
Asian markets have opened with a negative bias in mid-week trade after benchmarks on Wall Street retreated. Concerns are emerging over whether the recent equity rally has gone ahead of fundamentals.
Treasuries are steady ahead of the FOMC decision later tonight while oil prices are declining.
The Singapore-traded SGX Nifty, an early indicator of the NIfty 50 index's performance in India, rose 76 points to 10,088 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.
Let’s take a look at all that can influence equities in today’s trading session:
- Benchmarks in Japan have retreated this morning, as have those in South Korea and Australia.
- U.S. markets retreated on Tuesday, halting a surge that erased its losses for the year. The S&P 500 declined 0.8% while the Nasdaq briefly crossed the 10,000 mark, led by a surge in Apple shares.
- Technical indicators are suggesting a pullback in the equity markets after a rally that added nearly $21 trillion to global stock markets.
- The U.S. Federal Reserve will announce its policy decision later tonight where officials are unlikely to ease interest rates further.
- Yield on the 10-year treasury was flat at 0.82%.
- West Texas Intermediate crude fell 1.5% to $38.36 per barrel ahead of the inventory data to be reported later today.
Get your daily fix of the global markets here.
Earnings Fineprint: Hero MotoCorp Q4FY20
- Revenue down 20.8% to Rs 6,238.9 crore
- Net profit down 15% to Rs 620.7 crore
- Ebitda down 38% to Rs 659.9 crore
- Ebitda margin narrows to 10.6% from 13.6%
- Lockdown due to Covid-19 impacts revenue and Ebitda
- Tax expenses down to Rs 30 crore from Rs 351 crore
- Realisations up 6% to Rs 46,747 per unit
- Transition to BS-VI aids realisation
- All numbers are standalone and compared on a year-on-year basis
Stocks To Watch
- Wockhardt & Dr Reddy's: Payment terms of the deal announced in February have been revised. Rs 1,483 crore will be paid on the closing date of transfer, while Rs 67 crore will be kept in an escrow account and will be paid subject to some closing adjustments. Rs 300 crore will be held back to assess the Covid-19 impact. If sales cross Rs 480 crore in the next 12 months, then Dr Reddy's will have to pay twice of sales over Rs 480 crore. For 9MFY20, the said products earned a revenue of Rs 377 crore. The business contributed Rs 594 crore in FY19. The transfer of the Baddi facility is pending due to Covid-19. Wockhardt has hence, for the interim period, entered into an arrangement for Dr Reddy’s to manage the Baddi facility.
- Yes Bank: Madhu Kapur withdraws suit against the lender. The same has been allowed by the Bombay High Court. She along with other plaintiffs had southg relief with regards to participation in the management and promoter classification. On May 30, the plaintiffs have consented to reclassify their shareholding as 'public shareholders.'
- JM Financial: Launches QIP issue to raise funds. Issue price of Rs 66.72 is a 6% discount to the closing price on June 9. Bloomberg News reports that the sum raised through the QIP issue will be around $100 million.
- Bharti Airtel: Singapore arm increased its stake in Bangladesh-based Robi Axiata to 31.3% from 25%.
- Minda Corp: German arm has filed for insolvency due to liquidity crisis. The move is expected to enhance company’s Ebidta by 2% and RoCE by 5%.
- Equitas Holdings: Equitas Small Finance Bank is offering interest rate of 7% per annum on savings account having deposit between Rs 1 lakh to Rs 5 crore.
- Adani Green Energy: Gautam Adani stated in a conference call that there is room to dilute 10-15% stake in the company and that some companies are in talks to buy stake in Adani Green Energy.
- Wipro: Announced the expansion of its global strategic relationship with Amazon Web Services in the area of DevOps.
- Genral Insurance, Auto Stocks: The Insurance Regulatory and Development Authority of India (IRDAI) has withdrawn the long-term package cover of three to five years for Motor Own Damage for new cars and new two-wheelers from August 1.
- Godrej Consumer Products: Vivek Gambhir to resign as MD and CEO from June 30. Nisaba Godrej appointed as the new MD and Chairperson till September 2022.
- Oil India: Clearing operations were on at the well site in Assam after the well caught fire. There is no casualty reported. The situation demands arrangement of large quantities of water, installation of high discharge pumps and removal of debris. The entire operation will take about 4 weeks.
- Karnataka Bank's Covid-19 Update: Demand for credit may be muted initially. Additional provision of 10% has been frontloaded with respect to loan assets where the asset classification benefit is taken in the March quarter.
- Companies That Resumed Operations: Indo Rama Synthetics, Mirc Electronics, Hind Rectifiers, Precot Meridien.
- Non-Nifty Earnings Today: Shriram Transport Finance, Mahanagar Gas, Century Textiles, Dhanuka Agritech, Tata Metaliks, Dwarikesh Sugar, Jamna Auto, Indian Hotels, Shankara Building Products, Tanla Solutions, Jindal Stainless (Hisar), Voltamp Transformers.
Earnings Reported After Market Hours
Teamlease Services Q4FY20
- Revenue up 14.3% to Rs 1,330.3 crore
- Net loss of Rs 29.4 crore from net profit of Rs 26 crore
- Ebitda down 22.2% to Rs 20 crore
- Ebitda margin down to 1.5% from 2.2%
- Changes in taxation provisions where MAT credit was written-off impacts bottomline
- Employee/trainee headcount rises by 4,000 to 2.2 lakh
- Average realisation per associate in general staffing at Rs 748 per month from Rs 714
- Covid-19 provision of Rs 6.2 crore
- MAT credit of Rs 49.6 crore due to adoption of new tax regime.
- All numbers are consolidated and compared on a year-on-year basis
- Revenue down 1.6% to Rs 13,870.3 crore
- Net loss widens to Rs 1,887.4 crore from Rs 150.8 crore
- Ebitda loss of Rs 2,418.4 crore from Ebitda gain of Rs 251.3 crore
- Higher raw material costs, other expenses impact bottomline
- Deferred tax reversal of Rs 832.8 crore this quarter
- Gross Refining Margin at negative $4.52 per barrel
- Lower demand for crude oil and petroleum products impacts prices and refining margins
- All numbers are consolidated and compared on a year-on-year basis
- REC: UBS Principal Capital Asia acquired 2.2 crore shares (1.11%) at Rs 102.25 per share while Eastspring Investments sold 1.34 crore shares (0.68%) at Rs 102.25 per share.
- Varun Beverages: Promoter Ravi Kant Jaipuria and Sons sold 21 lakh shares (0.73%) at Rs 615 per share.
Pledged Share Details
- Forbes & Company: promoter Shapoorji Pallonji created pledge of 54.89 lakh shares on June 1.
- GMR Infra: Promoter GMR Enterprises released pledge of 1.24 crore shares on June 9
- Adani Ports and SEZ: Promoters revoked pledge of 28.25 lakh shares between June 4-8.
- Adani Transmission: Promoter SB Adani Family Trust revoked pledge of 9 lakh shares on June 8.
- Adani Green Energy: Promoter Adani Trading Services revoked pledge of 1.6 crore shares on June 8
(As Reported On June 9)
Who’s Meeting Whom
- UPL: To meet Axis AMC, Avendus and other investors between June 10-11.
- Tata Chemicals: To meet Stewart Investors and ICICI Prudential Mutual Fund between June 11-12.
- Blue Star: To meet Keyrock Capital Management, Enam AMC and other investors on June 11
- Record Date For Share Buyback: Tanla Solutions
- Price Band Revised From 10% To 5%: Anant Raj, 63 Moons Technologies, Borosil Renewables, DHFL, HCL Infosystems, ITDC, KIOCL, Mukand Engineers, Religare Enterprises, Reliance Naval and Engineering, Sundaram Multi Pap, Suzlon Energy, Tejas Networks, Zee Media Corporation.
- Price Band Revised From 20% To 10%: Den Networks, Hindusthan National Glass & Industries, Signet Industries, Sundaram Brake Linings.
- Move Into ASM Framework: GMM Pfaudler, McDowell Holdings, Aban Offshore, Setco Automotive, Walchandnagar Industries, Goa Carbon, Reliance Naval and Engineering, Tejas Networks, Reliance Communications.
- Move Into Short-Term ASM Framework: Himatsingka Seide, Hubtown, Anant Raj, AGC Networks, Brigade Enterprises, Prism Johnson, PG Electroplast, Dalmia Bharat Sugar and Industries, Den Networks, Dishman Carbogen Amcis, DHFL, Reliance Infrastructure, Gabriel India, Godrej Industries. Shriram EPC.
- V-Mart Retail: Promoters sold 1.25 lakh shares between May 29-June 6.
- Syngene International: Promoter Biocon Employee Welfare Trust sold 31,367 shares between June 4-5
(As Reported On June 9)
Money Market Update
- The rupee ended with a negative bias on Tuesday, closing at 75.62 against the U.S. Dollar as compared to Monday's close of 75.54.
- Nifty June futures closed at 10,034; discount widens to 12 points from 2 points
- Nifty June futures shed 0.3% and 33,900 shares in Open Interest
- Nifty Bank June futures closed at 20,678; discount of 47 points from premium of 10 points
- Nifty Bank June futures add 9.3% and 1.4 lakh shares in Open Interest
- Nifty Put-Call Ratio at 1.20 from 1.37 across all series
- Enters F&O Ban: JSPL
- Stocks In F&O Ban: Vodafone Idea, JSPL, Just Dial, NCC
- Out Of F&O Ban: BHEL
Nifty Weekly Expiry: June 11
- Maximum Open Interest on Call side at 10,500 strike (34.3 lakh shares)
- Maximum Open Interest on Put side at 9,800 strike (22 lakh shares)
- Active Options: 10,200 Call (+10.8 lakh shares) and 10,100 Call (+11.9 lakh shares)
Nifty Monthly Expiry: June 25
- Maximum Open Interest on Call side at 11,000 strike (19 lakh shares)
- Maximum Open Interest on Put side at 9,000 strike (36 lakh shares)