All You Need To Know Going Into Trade On October 6

Quarterly Business Updates

HDFC

• Month of September has seen strongest recovery since the outbreak of the pandemic
• Individual loan approvals in value up 31%
• Individual loan disbursements up 11%
• Individual loan receipts up 21%
• Number of loan applications received during the period up 12%
• Individual loan disbursements at 95% of same period last year
• Assigned loans worth Rs 3,026 crore to HDFC Bank
• Gross income from dividend at Rs 323 crore from Rs 1,074 crore
• Profit on sale of investment was nil as compared to Rs 1,627 crore last year

HDFC Bank

• Advances up 16% to Rs 10.37 lakh crore
• Deposits up 20% to Rs 12.29 lakh crore
• CASA Ratio at 42% from 39.3% last year
• Purchased loans worth Rs 3,026 crore through direct assignment route under home loan agreement with HDFC

IndusInd Bank

• Net advances up 2% to Rs 2 lakh crore
• Deposits up 10% to Rs 2.28 lakh crore
• CASA ratio at 40.4% from 41.4% last year
• Retail deposits and deposits from small business customers up 12% (QoQ) to Rs 75,610 crore

Tata Motors

• JLR's cash and short-term deposits up by 300 million pounds to 3 billion pounds
• Sales in China up 14.6% sequentially and 3.7% year-on-year. Month of September saw sales rise 28.5% year-on-year in China.
• Recovery has been demand-led and have been able to reduce stocks to achieve ideal levels in most markets
• Sales in U.K. up 230%, Europe up 78%, North America up 21% and overseas markets up 35.1% as compared to the previous quarter for JLR. However, sales in these markets have not recovered to pre-Covid levels yet.

Sobha

• Total sales volume at 8.91 lakh square feet worth Rs 690 crore
• Total average realisation of Rs 7,737 per square feet was the highest in the last five quarters
• No new launches were made during the quarter.
• Dependency on Bengaluru sales volume has reduced to 60% from 74% in the previous quarter.
• Sales value of Sobha down 5.4% to Rs 530.9 crore

Stocks To Watch

• State Bank of India: Banks Board Bureau has recommended the name of Dinesh Kumar Khara to take over as the new chairman this week. It has recommended names of S Janakiraman and Ashwini Kumar Tewari to take over as new Managing Directors. Janakiraman is currently Deputy MD - Finance while Tewari is the MD & CEO at SBI Card. Current MD Arijit Basu is likely to superannuate this month. The Bureau has also recommended Prakash Kumar Kandpal and Alok Kumar Choudhary as reserve list candidates for the two posts.
• CreditAccess Grameen: Launches QIP issue on Monday. Floor price of Rs 707.69 per share is a 5.3% discount to Monday's closing price. As per SEBI guidelines, the company may offer a discount of not more than 5% on the floor price. The panel will meet on October 8 to consider the date of closing the QIP and the issue price.
• Indo Rama Synthetics: Promoter Urmila Lohia to sell up to 1.76 crore shares or 6.72% stake in the company through an Offer for Sale. The floor price of Rs 24 per share is a 3.6% discount to Monday's closing price. The stake sale will fetch the promoter Rs 41.1 crore. The OFS opens for non-retail investors today and for retail investors tomorrow. Promoter stake to come down to 75% from the current 81.72% post the sale.
• Britannia: Issues one unsecured, non-convertible, redeemable fully paid-up debenture of face value of Rs 29 each by way of bonus to members of the company, for every one share held. It has also paid dividend of Rs 12.5 per share by utilising its accumulated profits.
• Majesco: To consider share buyback on October 8.
• Infibeam Avenues: Enters into definitive agreement with Jio platforms to license, customise, maintain and access the company's enterprise e-commerce software and payments platform for their business use.
• Gujarat State Fertilisers and Chemicals: To take up manufacturing of Calcium Nitrate, becoming the first company in India to do so. It intends to commence production with an initial capacity of approximately 10,000 MTPA which will be expandable up to 15,000 MTPA. It is also likely to reach 30,000 MT in the next 12 months. The company expects this move to add Rs 20 crore to its topline and 7-8% growth in net profit.
• Escorts: Completes acquisition of 2 crore shares of Kubota Agricultural Machinery India, constituting 40% of the share capital at Rs 45 per share.
• Gujarat Pipavav Port: Container Cargo Volumes down 25% to 1,68,000 TEUs in the July-September period.
• PVR: Board issued NCDs worth Rs 50 crore.
• Sterlite Tech: Appointed Mihir Modi as the CFO from October 5. Modi was earlier the CFO at Zee Entertainment.
• Sanofi India: Board has appointed Vaibhav Karandikar as the CFO from October 6.
• Usha Martin: CBI filed a FIR on October 2 against the company, its Managing Director Rajeev Jhawar and certain other individuals, for alleged offences under the Prevention of Corruption Act, 1988 and the Indian Penal Code, 1860. CBI officials visited company’s Delhi office on October 3 in connection with the above. The matter is under investigation and the company says it will fully cooperate with the CBI and other law enforcement agencies, under appropriate legal advice.
• OMDC: Admitted to the Corporate Insolvency Resolution Process as per the orders of NCLT, Kolkata.
• Deepak Fertilisers: Wholly-owned arm Smartchem Tech raised Rs 105 crore via debentures from the International Finance Corporation.

Brokerage Radar

Morgan Stanley On HDFC

• Overweight rating maintained
• Price target of Rs 2,280
• Update surprised on much stronger momentum in individual loan business
• See upside risks to our FY21 individual AUM growth forecast of 10%
• RoE likely to reach 15% in FY22
• Momentum can build further ahead of the festive season and more states undertaking cuts in stamp duty
• View risk-reward as very attractive

Morgan Stanley On Asian Paints

• Upgrade to overweight from equalweight
• Price target raised to Rs 2,300 from Rs 1,810
• Likely to move into the second leg of the consumption recovery cycle
• Expect faster demand recovery in decorative painting as economy opens up
• Further demand for industrial paints will benefit from stronger demand for the automotive industry
• Benign input cost environment, stable currency and cost control measures will help margins in the near-term
• Though underperforming the index since March, it is likely to outperform going forward
• Key Risks: Spike in Covid-19 cases resulting in lockdown, particularly in urban areas

CLSA On Adani Ports

• Upgrade to buy from outperform
• Price target raised to Rs 425 from Rs 386
• A rise in the share of bulk is a long-term risk
• Krishapatnam Port acquisition to solidify hold over the east coast and improve earnings quality
• Yield from the acquisition likely to be 17% in FY22CL
• Raise EPS estimates by 6-10% over FY22-23CL
• Trading at a discount to competitors

Nomura On Adani Ports

• Buy rating maintained
• Price target of Rs 420
• New deal value accretive by Rs 10.4 per share
• FY21 Ebitda estimates largely incorporate Covid-19 impact
• Management estimate of Ebitda of Rs 1,200 crore seems realistic

CLSA On Marico

• Underperform rating maintained
• Price target of Rs 350
• Low topline base likely to aid relatively better quarterly show
• Commentary suggests operations returning to pre-Covid levels
• Cost-saving initiatives likely to aid earnings growth
• Key Risks: Increase in input prices, worse-than-expected volume growth and margin disappointment
• Maintain rating due to full valuations

Pledged Share Details

• Emami: Promoters released pledge of 23.5 lakh shares between September 29-30.
• Future Consumer: Promoter Future Capital Investment invoked pledge of 18 lakh shares between September 14-16.

(As Reported On October 5)

Who’s Meeting Whom

• Eicher Motors: To meet Comgest, BNP Paribas and HDFC Life Insurance between October 6-7.
• Mahanagar Gas: To meet Nomura Securities on October 7.

Bulk Deals

• Angel Broking: BNP Paribas Arbitrage sold 5.25 lakh shares at Rs 280.13 per share.
• Deepak Fertilisers Rights Issue: Aequitas Investment Consultancy sold 1.03 lakh shares at Rs 13.99 per share.

Trading Tweaks

• AGM: Texmo Pipes and Products
• Ex-Date Demerger: Anant Raj
• Price Band Revised From 20% To 10%: Himatsingka Seide
• Price Band Revised From 10% To 5%: Federal-Mogul Goetze
• Price Band Revised From 20% To 5%: Anant Raj
• Price Band Revised From 5% To 20%: Panacea Biotec
• Move Into Surveillance Measure For Companies With High Encumbrance: Hindustan Zinc, Emami, Hexaware Technologies, Jindal Stainless, Omaxe, Deepak Fertilizers And Petrochemicals, RattanIndia Power.
• Move Out Of Surveillance Measure For Companies With High Encumbrance: Kalpataru Power Transmission, Future Lifestyle Fashions, Vedanta, Sterling And Wilson Solar, Panacea Biotec.
• Move Into ASM Framework: Welspun India, Intellect Design Arena, Urja Global.
• Move Into Short Term ASM Framework: Electrosteel Castings, MBL Infrastructures, Precision Wires India, S. P. Apparels, InfoBeans Technologies.
• Move Out Of Short Term ASM Framework: Vikas WSP, Macpower CNC Machines, Globus Spirits, NDR Auto Components.

Insider Trades

• Somany Ceramics: Promoter Ameya Somany acquired 30,000 shares on September 30.
• Thyrocare Technologies: Promoter A Velumani HUF acquired 26,578 shares between September 29-30.

(As Reported On October 5)

Money Market Update

• The rupee ended weaker on Monday at 73.29 against the U.S. Dollar as compared to Thursday's close of 73.15.
• The currency was the second worst performer in Asia on Monday.

F&O Cues

• Nifty October futures closed at 11,527; premium of 24 points from 23 points
• Nifty October futures add 1% and 1.1 lakh shares in Open Interest
• Nifty Bank October futures closed at 22,444; premium of 73 points from 46 points
• Nifty Bank October futures shed 3% and 44,000 shares in Open Interest
• Nifty Put-Call Ratio at 1.42

Nifty Weekly Expiry: October 8

• Maximum Open Interest on Call side at 11,800 strike (31.6 lakh shares)
• Maximum Open Interest on Put side at 11,000 strike (22.8 lakh shares)
• Active Options: 11,500 Put (14.4 lakh shares) and 11,800 Call (19.8 lakh shares)

Nifty Monthly Expiry: October 29

• Maximum Open Interest on Call side at 12,000 strike (18.1 lakh shares)
• Maximum Open Interest on Put side at 10,500 strike (36.2 lakh shares)