All You Need To Know Going Into Trade On November 5

Stocks To Watch

• HPCL: Announces share buyback worth Rs 2,500 crore. The board will buyback 10 crore shares or 6.56% of the total equity at Rs 250 per share. The buyback price is a 33.9% premium to Wednesday's closing price.
• SRF: Board approves setting up of a second BOPP film line in Indore at a cost of Rs 424 crore. It will also set up a dedicated facility to produce 200 MT per year of P16 specialty product at Dahej at a cost of Rs 17.5 crore.
• Jubilant Life Sciences: Board approved raising Rs 100 crore via NCDs. Company’s arm to acquire 25% stake in U.S.-based Sofie Biosciences for $25 million.
• SBI Cards and Payment Services: Partners with Paytm to launch Paytm SBI Card.
• Tata Motors: S&P Global Ratings cuts outlook to negative from stable on weaker-than-expected operating performance. It believes that weak CV sales will impact the overall profitability of Indian operations and that lower earnings will delay deleveraging.
• Tube Investments: Board approved providing of guarantee(s) in favour of lenders of CG Power and Industrial Solutions towards the financial assistance to be availed by CG Power for an aggregate amount of up to Rs.1,400 crore.
• Kalpataru Power Transmission: All approvals for the sale of Alipurduar Transmission have been received. The company expects to receive cash proceeds this month.
• Inox Leisure / PVR: Maharashtra Government allows Cinema halls / multiplexes to open with 50% of their seating capacity in areas outside the containement zone starting today. No eatables will be allowed inside. SoP will be issued by the cultural affairs department and local authorities.
• Non-Nifty Earnings Today: Adani Power, Bajaj Electricals, Berger Paints, Birlasoft, CONCORF, Dalmia Bharat, Emami, GCPL, Gujarat Gas, Inox Leisure, Jamna Auto, Muthoot Capital, Torrent Power, Vinati Organics.

Earnings Reported After Market Hours

Pidilite Industries Q2FY21

• Revenue up 4% to Rs 1,880.3 crore
• Net profit up 10% to Rs 356.4 crore
• Ebitda up 39.2% to Rs 512.7 crore
• Ebitda margin at 27.3% from 20.4%
• Lower raw material costs and expenses aid margin expansion
• All numbers are consolidated and compared on a year-on-year basis

HPCL Q2FY21

• Revenue up 37.3% to Rs 51,773 crore
• Net profit down 12% to Rs 2,477.4 crore
• Ebitda down 17.2% to Rs 3,603.9 crore
• Ebitda margin at 7% from 11.5%
• All numbers are standalone and compared on a quarter-on-quarter basis

Adani Green Energy Q2FY21

• Revenue down 11.1% to Rs 611.9 crore
• Net profit down 81.2% to Rs 18.8 crore
• Ebitda up 16.7% to Rs 492.9 crore
• Ebitda margin at 80.6% from 61.4%
• Higher depreciation and finance costs charged in the current quarter aided margins
• All numbers are consolidated and compared on a year-on-year basis

SRF Q2FY21

• Revenue up 21% to Rs 2,100.8 crore
• Net profit up 57% to Rs 315.2 crore
• Ebitda up 73% to Rs 572.5 crore
• Ebitda margin at 27.3% from 19%
• Tax expenses rise to Rs 116.4 crore from Rs 4.1 crore
• Lower raw material costs and other expenses aid margins
• All numbers are consolidated and compared on a year-on-year basis

United Spirits Q2FY21

• Revenue down 6.5% to Rs 2,145.9 crore
• Net profit down 42.8% to Rs 128.4 crore
• Ebitda down 35.1% to Rs 269.7 crore
• Ebitda margin at 12.6% from 18.1%
• Higher raw material costs and higher excise impact margins
• All numbers are standalone and compared on a year-on-year basis

Happiest Minds Technologies Q2FY21

• U.S. Dollar revenue up 5.4% to $24.7 million
• Revenue up 0.5% to Rs 187.9 crore
• Net profit down 32.1% to Rs 34.1 crore
• Ebitda up 3.3% to Rs 49.4 crore
• Ebitda margin at 26.3% from 25.6%
• All numbers are consolidated and compared on a quarter-on-quarter basis

Brokerage Radar

Morgan Stanley On State Bank of India

• Upgrade to overweight from equalweight
• Price target raised to Rs 280 from Rs 215
• Risk-reward balance is now attractive
• Macro tail risk has diminished and asset quality trends have held up well
• Well positioned on liquidity
• Expect ~9% RoE in FY22e and 13% in FY23e
• A sharp rise in Covid-19 cases is a key risk to the thesis

CLSA On State Bank of India

• Buy rating maintained
• Price target raised to Rs 330 from Rs 310
• Growth in NII, PPoP, commentary on asset quality was reassuring
• Reduce estimated credit costs to 200 bps from FY21 from 230 bps earlier
• Reduction in credit costs drives 60% earnings estimate increase for FY21
• Expect RoE of 7.6%, 9.7% and 11.9% in FY21, FY22 and FY23 respectively
• Valuations should start to mean-revert as uncertainty around asset quality decreases

CLSA On HPCL

• Upgrade from Sell to Buy
• Price target raised to Rs 225 from Rs 180
• Open market buyback of more than 18% of current free float is good news
• A miss on core Ebitda but inventory gains drive profit beat
• Buyback will give the right bang for buck
• Raise FY21 EPS estimates by 62% and FY22 EPS estimates by 1%
• High marketing exposure puts it at an advantage versus IOC and BPCL

Pledged Share Details

• Adani Transmission: Promoter SB Adani Family Trust created pledge of 6.4 crore shares on October 29.
• Adani Ports & SEZ: Promoter SB Adani Family Trust created pledge of 15.51 crore shares on October 29.
• Sun Pharma: Promoter Shanghvi Finance created pledge of 27.75 lakh shares on October 29.
• LT Foods: Promoter Raghuvesh Holdings released pledge of 30 lakh shares on November 3.

(As Reported On November 4)

Who’s Meeting Whom

• CRISIL: to meet PGIM India Asset Management on November 5.
• CDSL: To meet IIFL AMC on November 5.
• Dixon Tech: To meet Ward Ferry Management, Haitong Securities and other investors between November 5-10.

Bulk Deals

• Adani Ports & SEZ: Europacific Growth Fund sold 2.58 crore shares (1.27%) at Rs 352.01 per share.
• Matrimony.com: SBI Mutual Fund acquired 5 lakh shares (2.2%) at Rs 628 per share and CMDB II sold 5 lakh shares (2.2%) at Rs 628 per share.

Trading Tweaks

• Move Into ASM Framework: Greenpanel Industries.
• Move Out Of Short Term ASM Framework: Nahar Polyfilms, Music Broadcast.

Insider Trades

• HFCL: Promoter MN Ventures acquired 10 lakh shares on November 4.

(As Reported On November 4)

Money Market Update

• The rupee declined for the third time in the last four trading sessions on Wednesday, ending at 74.76 against the U.S. Dollar, as compared to Tuesday's close of 74.41.
• The rupee was the worst performing currency in Asia on Wednesday.

F&O Cues

• Nifty November futures closed at 11,908; discount of 1 point from premium of 10 points
• Nifty November futures add 4.9% and 4.9 lakh shares in Open Interest
• Nifty Bank November futures closed at 25,684; discount of 86 points from 3 points
• Nifty Bank November futures shed 8% and 1.5 lakh shares in Open Interest
• Nifty Put-Call Ratio at 1.52

Nifty Weekly Expiry: November 5

• Maximum Open Interest on Call side at 12,300 strike (24.6 lakh shares)
• Maximum Open Interest on Put side at 11,000 strike (23.7 lakh shares)
• Active Options: 11,900 Put (+7.3 lakh shares) and 12,300 Call (+11 lakh shares)

Nifty Monthly Expiry: November 26

• Maximum Open Interest on Call side at 12,000 strike (18.4 lakh shares)
• Maximum Open Interest on Put side at 11,000 strike (25.6 lakh shares)