All You Need To Know Going Into Trade On May 7
Asian stocks fell with U.S. futures after President Donald Trump’s top trade negotiator said the U.S. plans to proceed with a tariff hike on Chinese goods on Friday. The Chinese yuan dipped.
Korean and Japanese shares slid as both markets came back online after holidays. The Singapore-traded SGX Nifty, an early indicator of NSE Nifty 50 Index’s performance in India, rose 0.3 percent to 11,692 as of 7:25 a.m.
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Here’s a quick look at all that could influence equities today.
U.S. Market Check
- The S&P 500 Index fell 0.5 percent as of 4:05 p.m. New York time, while the Nasdaq Composite Index dropped 0.5 percent.
- The yield on 10-year Treasuries fell six basis points to 2.47 percent
- Japan’s Topix index fell 0.9 percent as of 9:18 a.m. in Tokyo.
- Australia’s S&P/ASX 200 Index rose 0.4 percent.
- South Korea’s Kospi index dropped 1.5 percent.
- Brent crude traded 0.2 percent lower at $71.12 per barrel.
- West Texas Intermediate slipped 0.2 percent to $62.12 a barrel Monday.
- Gold edged higher to $1,283.27.
Stocks To Watch
- HDFC Bank to consider stock split on May 22. Board will consider splitting each share into two shares.
- Astec Lifesciences withdrew its merger proposal with Godrej Agrovet. The company says it has reviewed the proposal and has decided not to pursue the scheme further at this time on the basis of interaction with multiple stakeholders across the company and Godrej Agrovet.
- Dhanuka Agritech launched three new products in domestic market ranging from herbicides to pesticides. These launches will help for cotton and chilli crop protection, and paddy growers.
- NACL entered into a long-term manufacturing contract with UPL for manufacturing agrochemical intermediates for Rs 75 crore per annum for six years, which can then be renewed further on mutually agreed terms.
- Tata Steel: The EU’s review of the Tata/ThyssenKrupp joint venture is "an open case" with "still quite some time from the decision" deadline in June, EU Competition Commissioner Margrethe Vestager said. (Bloomberg News)
- VST Tillers Tractors April’s total sales were down 29 percent at 721 units versus 1018 units, on a year on year basis. Power Tillers sale down 57 percent at 289 units versus 668 units and tractors sale up 23 percent at 432 units versus 350 units.
- L&T Technology Services: Board appointed Abhishek Sinha as Chief Operating Office of the company with effect from May 6.
- Lemon Tree Hotels opened a 49-room property in Rajasthan.
- Prabhat Telecoms: Board approved the re-appointment of Vishwamani Tiwari as Managing Director of the company till March 2024.
- Talwalakhars Healthclubs: Board accepted the resignation of the existing statutory auditors SGCO & Company LLP and Avinash Phadke as the Independent Director of the company, respectively.
- Indian Overseas Bank said that as a part of strategy to raise its capital by selling non-core assets it has identified 32 properties for sale including prime properties in Singapore and Hongkong aggregating in value to Rs 900 crore. The Bank has already initiated the process for sales of the remaining 26 properties valued at about Rs. 775 crore, as per the exchange filing.
- PNC Infratech executed share purchase agreement to sell 35 percent stake in Ghaziabad Aligarh Road Project for Rs 270 crore to Cube Highways. Due to this action the company says it will be able to recover its outstanding EPC receivables, which would result in total cash inflow of Rs 300 crore to the company.
- Firstsource Solutions appointed Richard Stagg, Chairman of Rothschild India as the company’s additional director.
- Mcleod Russel completed sale of 45 percent stake in its Rwandan arm to Borelli and Rwanda Tea Company (U.K.).
- Bharti Airtel: To transfer its VSAT business undertaking to Hughes Communications India and HCIL Comtel on a going concern basis by way of slump sale. Company did not disclose the consideration for the same.
Nifty Results To Watch
Other Results To Watch
- Essel Propack
- Sun Pharma Advanced Research
- Globus Spirits, ABB India
- Brigade Enterprises
- VIP Industries
- Gujarat Borosil
- Hester Biosciences
- Jyothy Laboratories
- Mahindra Logistics
- Piramal Phytocare
- Rashtriya Chemicals and Fertilizers
- Supreme Industries
- Sanofi India
- Star Cement
- 3i Infotech
- Chemfab A lakhalis
- Eimco Elecon
- Elecon Engineering Company
- Elantas Beck India
- Globus Spirits
Earnings Reaction To Watch
Bharti Airtel (Q4 Consolidated, QoQ)
- Revenue up 1.8 percent to Rs 20,602 crore.
- Net profit up 24.4 percent to Rs 107 crore.
- Ebitda up 6.7 percent to Rs 6,632 crore.
- Margins at 32.2 percent versus 30.7 percent.
- Exceptional Gain of Rs 2,022 crore.
- India mobile business revenue rose 4.3 percent to Rs 10,632 crore.
- India mobile business reported strong revenue growth mostly on back rising share of 4G users
ICICI Bank (Q4, YoY)
- Net Interest Income up 26.5 percent to Rs 7,620 crore.
- Net profit down 5 percent to Rs 969 crore.
- Gross NPA at 6.7 percent versus 7.75 percent (QoQ)
- Net NPAs at 2.06 percent versus 2.58 percent (QoQ)
- Other income to Rs 3621 crore versus Rs 5,678.
- CASA ratio at 49.6 percent versus 49.3 percent (QoQ)
- Provision coverage ratio at 80.7 percent versus 60.5 percent.
- Appoints Sandeep Batra as Executive Director
Marico (Q4 Consolidated, YoY)
- Revenue up 8.7 percent to Rs 1,609 crore.
- Net profit up 2.2 times to Rs 406 crore.
- Ebitda up 12.3 percent to Rs 283 crore.
- Margins at 17.6 percent versus 17 percent.
- Net profit higher in account of tax adjustments worth Rs 188 crore.
- Adjusted net profit up 18.6 percent to Rs 217 crore.
- India volume growth of 8 percent.
Wockhardt (Q4 Consolidated, YoY)
- Revenue down 3.8 percent to Rs 979.1 crore.
- Net loss of Rs 13.9 crore versus net loss of Rs 152.9 crore
- Ebitda at Rs 34.8 crore versus Ebidta loss of Rs 29.9 crore.
- Deferred tax reversal of Rs 35.5 crore.
- Depreciation expense up 19 percent to Rs 45 crore.
- RM as percent of sales at 21 percent versus 25 percent.
- Employee Expenses down 14 percent to Rs 191 crore.
- Board approves raising Rs 1,500 crore via equity.
- Recommends re-appointment of Dr HF Khorakiwala as executive chairman till February 2025.
Gujarat Gas (Q4 Standalone, YoY)
- Revenue up 10 percent to Rs 1907.6 crore.
- Net profit up 76.5 percent to Rs 116.5 crore.
- Ebitda up 14.1 percent to Rs 254.1 crore.
- Margins at 13.3 percent versus 12.8 percent.
- Other Income up 89 percent to Rs 18.7 crore.
- Current taxes down 57 percent to Rs 15 crore.
Godrej Agrovet (Q4 Consolidated, YoY)
- Revenue up 12.5 percent to Rs 1343.9 crore.
- Net profit up 4.5 times to Rs 113.7 crore.
- Ebitda up 1.1 percent to Rs 74.9 crore.
- Margins at 5.6 percent versus 6.2 percent.
- Exceptional gain of Rs 88.3 crore.
- RM as percent of sales at 80 percent versus 75 percent.
- Declares dividend of Rs 4.5 per share.
- Board withdrew proposed scheme of amalgamation of Astec LifeSciences with the company.
Great Eastern Shipping Corporation of India (Q4 Consolidated, YoY)
- Revenue up 26.7 percent to Rs 974.4 crore.
- Net profit at Rs 148.5 crore versus net loss of Rs 419.1 crore.
- Ebitda at Rs 408.1 crore versus Ebitda loss of Rs 3.5 crore.
- Gain of Rs 104.3 crore in current quarter due to change in fair value of contracts
- Deferred tax reversal of Rs 16.4 crore versus deferred tax of Rs 167 crore.
- Declares dividend of Rs 5.4 per share.
Thirumalai Chemicals (Q4 Consolidated, YoY)
- Revenue down 4.5 percent to Rs 315.7 crore.
- Net profit down 55.4 percent to Rs 17.7 crore.
- Ebitda down 47.1 percent to Rs 37 crore.
- Margins at 11.7 percent versus 21.2 percent.
- Inventory Loss of Rs 26.4 crore.
- RM as percent of sales at 65 percent versus 49 percent.
Navin Fluorine International (Q4 Standalone, YoY)
- Revenue up 17.2 percent to Rs 244.3 crore.
- Net profit down 8.7 percent to Rs 35.9 crore.
- Ebitda up 13.2 percent to Rs 52.2 crore.
- Margins at 21.4 percent versus 22.1 percent.
- Inventory gain of Rs 10.6 crore in base quarter.
- Other income down 35 percent to Rs 13 crore.
- RM as percent of sales at 43.3 percent versus 47.9 percent.
- Larsen & Toubro acquired 11.52 lakh shares (0.70 percent) to Rs 979.34 each.
Pledge Share Details
- Sun Pharma promoter Shanghvi Finance revoked pledge of 79.75 lakh shares on May 6.
- Adani Enterprises promoter group Gautam Adani revoked pledge of 4 lakh shares on May 3.
- 63 Moons Technologies, Roto Pumps to move into short term ASM Framework
- Goldiam International price band revised to 10 percent
- Dhanuka Agritech promoter Manish Dhanuka sold 17,200 shares on May 3.
- Crest Ventures promoter Fine Estates acquired 26,000 shares on May 2.
- Sandhar Technologies promoter and director Jayant Davar acquired 8,000 shares from January 8-9.
Money Market Update
- The rupee on Monday snapped its four-day rising streak to close at 69.41/$ versus Friday’s closing of 69.22/$.
Futures –May series
- Nifty futures closed trading at 11,656.3, premium of 58 points versus 52 points.
- Nifty open interest up 2 percent adds 3.2 lakh shares in open interest.
- Bank Nifty futures closed trading at 29,808.7, premium of 190 points versus 106.6 points.
- Bank Nifty open interest up 2 percent, adds 35,000 shares in open interest
- Nifty PCR at 1.30 versus 1.49 (across all series)
Nifty Weekly Expiry 9 May
- Max open interest concentration at 11,700C (26.2 lakh shares), 11,800C (+25.9 lakh shares), 11,600P (15.4 lakh shares).
- Max open interest addition seen at 11,700C (+18.5 lakh shares) & 11,650C (+10 lakh shares).
Nifty Monthly Expiry 30 May
- Max open interest on Put side at 11,000 (23.4 lakh shares).
- Max open interest on call side at 12,000 (14.6 lakh shares).
- Max open interest addition seen at 12,000C (+2.2 lakh shares), 10,500P (+1.8 lakh shares).
Stocks In Ban
- Jet Airways
On Bharti Airtel
- Maintained ‘Buy’ with target price of Rs 390.
- India mobile revenues better than expected.
- Growth driven by min-APRU plans, continued 4G net adds and impact of price hike.
- Rights issue and other capital levers to bring gearing in control.
- Maintained ‘Hold’ with target price of Rs 354.
- Q4FY19 directionally positive; estimate an ARPU of Rs 125.
- Bharti India wireless has incrementally added Ebitda for the first time in the last 10 quarters.
- Despite ARPU improvement India wireless revenue grew lower than Jio.
On ICICI Bank
- Maintained ‘Outperform’; hiked target price to Rs 465 from Rs 450.
- Q4 net profit missed due to higher provisions and write-offs.
- FY20 credit cost normalisation story intact.
- Preferred play on asset quality normalisation theme.
- Maintained ‘Buy’; hiked target price to Rs 500 from Rs 470.
- Slippage higher but visibility for normalised credit cost rises.
- Pick-up in Casa growth key to loan growth, and new initiatives can help.
- Earnings set to rebound from FY20; hike estimates by 1-3 percent.
Macquarie on Marico
- Maintained ‘Outperform’; hiked target price to Rs 412 from Rs 394.
- Q4 Ebitda below estimate due to higher investments and higher promotions.
- Recovery in Saffola – key positive.
- Operating margin expected to improve on lower input cost and operating leverage.
Macquarie on Gujarat Gas
- Maintained ‘Outperform’ with target price of Rs 165.
- Volume decline driven by industrial segment.
- See highest structural volume growth potential for Gujarat Gas.
CLSA on Marico
- Maintained ‘Buy’ with target price of Rs 465.
- Q4: Ebitda below but net earnings ahead.
- Healthy growth driven by Saffola and good margin expansion.
- Copra prices expected to remain benign and there is focus on new launches and GTM transformation.