Sensex, Nifty Clock Longest Losing Streak In Nearly Three Months

Good morning!

The Singapore-traded SGX Nifty, an early indicator of NSE Nifty 50 Index’s performance in India, fell 0.19 percent to 11,381 as of 8:05 a.m.

Asian stocks retreated with U.S. equity futures Thursday as the clock ran down for an escalation in tariffs between the world’s two largest economies.

Stocks in Japan led losses, with declines also in Hong Kong and South Korea, while Australia’s main index rose.

Short on time? Well, then listen to this podcast for a quick summary of All You Need To Know before the opening bell podcast.

• Brent crude fell 0.7 percent to $69.88 per barrel.
• West Texas Intermediate fell 0.6% to $61.73 a barrel.
• Gold edged up 0.1 percent to $1,282.33 an ounce.

London Metal Exchange

• Copper ended lower for the second day, down 0.5 percent.
• Aluminium ended 1.05 percent lower.
• Tin ended higher for the third day, up 0.13 percent.
• Zinc ended lower for the second day, down 1.6 percent.
• Nickel ended 0.79 percent lower.
• Lead ended 1.4 percent lower.

• The U.S. releases trade data Thursday.
• China reports on inflation Thursday. The U.S. releases the April CPI report Friday.

• Hindalco: Unit Novelis’ fourth quarter net sales up 1 percent at $3.1 billion and net income up 29 percent at $130 million (excluding special items). Adjusted Ebitda up 12 percent at $357 million. The company said sales were driven by the higher total shipments which was partially offset by lower average aluminium prices.
• Vodafone Idea: Vodafone Group’s international and domestic promoters pledged 44.39 percent stake of the company to a group of seven international banks.
• Deepak Fertilizers and Petrochem: Board approved May 8 as the day of issuance for FCCBs aggregating to $30 million at a floor price of Rs 139.59 per share. They also approved raising debentures worth Rs 210 crore to World Bank’s arm.
• Glenmark Pharma: Says Ryaltris Phase III study met primary endpoint and positive results were seen. Ryaltris is a nasal spray used for treatment of seasonal allergic rhinitis. This study was carried in patients from six-to-twelve years of age. This drug is under the U.S. FDA review in patients who are above 12 years of age.
• Dilip Buildcon’s arm received financial closure for hybrid annuity model project in Maharashtra worth Rs 1,141 crore.
• Jet Airways’ clarified it is not in a position to comment on offer of Rs 250 crore being made by Naresh Goyal towards the company.
• Great Eastern Shipping Company said it has delivered a large gas carrier to buyers. The vessel was contracted for sale in January 2019.
• TVS Motor’s Singapore arm to invest Rs 11.2 crore in Tagbox Solutions. The target company provides supply chain solutions.
• Reliance Communications: As per the resumption of insolvency proceedings, management of affairs to vest in the administrator and power of Board of Directors stands suspended.
• Religare Enterprises: India Ratings downgraded Religare Finvest to ‘D’ from ‘B+’ while resolving rating watch negative. The downgrade reflects the company’s delay in meeting its debt servicing obligations and the company is facing deepened stress in its liquidity situation.
• Yes Bank: India Ratings downgraded long-term issuer rating to IND ‘AA-‘ from IND ‘AA+’ with a negative outlook.
• MCX: Mrugank Paranjape ceased to be MD and CEO of the exchange with immediate effect, on expiry of his term.
• CCI approved acquisition of 6.5 percent stake of PNB Housing Finance by General Atlantic Singapore HF.
• Shree Renuka Sugars’ Mauritius arm entered a term-sheet with a potential investor to explore a transaction, which may result in the company ceasing to hold more than 50 percent stake in its Mauritius arm.
• Bharat Financial Inclusion completed its first direct assignment transaction worth Rs 1,107.4 crore for the financial year 2020.

Nifty Earnings To Watch

• Asian Paints
• HCL Technologies

Other Earnings To Watch

• Voltas
• Mahanagar Gas
• Apollo Tyres
• Mangalam Drugs And Organics
• Matrimony.com
• Oracle Financial Services Software
• Plastiblends India
• PNB Housing Finance
• Shankara Building Products
• South Indian Bank
• Sundram Fasteners
• Astra Microreowave Products
• Datamatics Global Services
• Dai-Ichi Karkaria
• Dalmia Bharat
• Esab India
• Granules India
• Solar Industries India
• Gujarat State Petronet
• Hikal
• Hindustan Construction Company
• Hindustan Media
• Hinduja Ventures
• Huhtamaki PPL
• ICRA
• Indian Overseas Bank
• Kalpataru Power Transmission
• McDowell Holdings
• Fairchem Speciality
• Gujarat Mineral Development Corporation
• Saint-Gobain Sekurit
• Sutlej Textiles and Industries
• Timex Group
• Satia Industries

Earnings Reaction To Watch

Titan (Q4, YoY)

• Revenue up 20.7 percent to Rs 4,671 crore.
• Net profit up 4.4 percent to Rs 294.6 crore.
• Ebitda up 11.3 percent to Rs 455 crore.
• Margin at 9.7 percent versus 10.6 percent.
• Exceptional loss of Rs 70 crore.

KEC International (Q4, YoY)

• Revenue up 4.9 percent to Rs 3,841.2 crore.
• Net profit down 0.9 percent to Rs 193.9 crore.
• Ebitda up 7.9 percent to Rs 399.2 crore.
• Margin at 10.4 percent versus 10.1 percent.
• Deferred tax reversal of Rs 24.9 crore in base quarter
• Material costs down 19 percent to Rs 1,736.3 crore.
• Erection and Subcontracting expenses up 54 percent to Rs 1,048.2 crore.
• Board approves reappointment of Vimal Kejriwal as MD and CEO till March 2020.

Tata Communications (Q4, QoQ)

• Revenue down 0.6 percent to Rs 4,243.5 crore.
• Net loss at Rs 198.5 crore versus net profit at Rs 173.8 crore.
• Ebitda down 18.7 percent to Rs 685.3 crore.
• Margin at 16.1 percent versus 19.7 percent.
• Loss in associates to Rs 160.7 crore.
• Other expenses up 38 percent to Rs 1,105.1 crore.
• Deferred tax reversal of Rs 29.6 crore in base quarter.

Shriram Transport Finance (Q4, YoY)

• Net Interest Income up 5 percent to Rs 1,931.2 crore.
• Net profit down 22.4 percent to Rs 746 crore.
• Exceptional gain of Rs 139.7 crore in base quarter.
• Deferred tax payment of Rs 453 crore in base quarter.
• Declares dividend of Rs 7 per share.

Saregama India (Q4, YoY)

• Revenue up 17.6 percent to Rs 124 crore.
• Net profit down 25.1 percent to Rs 16.1 crore.
• Ebitda up 4.5 percent to Rs 16.3 crore.
• Margin at 13.1 percent versus 14.8 percent.
• Royalty expense up 3.2 times to Rs 14.6 crore.

CreditAccess Grameen (Q4, YoY)

• Net Interest Income up 27.5 percent to Rs 209.7 crore.
• Net profit up 6.4 percent to Rs 76.3 crore.

Gillette India (Q4, YoY)

• Revenue up 3.1 percent to Rs 465.5 crore.
• Ebitda up 23.8 percent to Rs 146.2 crore.
• Margin at 31.4 percent versus 26.1 percent.
• Net profit up 23.1 percent to Rs 87.8 crore.
• Lower employee and advertising cost aid Ebitda.
• Other income was up three times to Rs 3.3 crore.

• Zee Entertainment Enterprises: Catalyst Trusteeship sold 86 lakh shares or 0.9 percent equity to Rs 342.3 each.

• Future Lifestyle Fashions promoter Ryka Commercial Ventures created pledge of 27.5 lakh shares on May 7.
• Eros International Media promoter Eros Worldwide created pledge of 27.5 lakh shares from May 3-6.
• Emami promoters created pledge of 19.4 lakh shares from April 20-May 7.

• Eclerx Services ex-date for share buyback.
• Prakash Industries price band revised to 20 percent.
• Eveready Industries price band revised to 5 percent.

On Titan

CLSA

• Maintained ‘Outperform’; hiked price target to Rs 1,225 from Rs 1,100.
• March quarter were impacted by one-offs – inventory valuation hit and ex-gratia pay-outs to employees.
• Jewellery: strong growth, record margin and positive outlook.
• Mixed performance for other segments.

JPMorgan

• Maintained ‘Overweight’ with a price target of Rs 1,200.
• Good March quarter; positive outlook and start to 2019-20.
• Jewelry – All round impressive performance.
• Titan remains one of the higher growth companies in our coverage universe.

UBS

• Maintained ‘Buy’ with a price target of Rs 1,250.
• Sustained strong performance in jewellery business.
• Optically depressed performance due to one-offs.
• Formalisation and wedding jewellery expansion continues.

On Shriram Transport

CLSA

• Maintained ‘Sell’ with a price target of Rs 960
• Growth moderates to sub-10 percent; expect normalisation towards the second half.
• Asset quality better but watch out for aggressive rural and business growth.
• Group reorganisation can be an overhang.

UBS

• Maintained ‘Buy’; cut price target to Rs 1,450 from Rs 1,550.
• Strong asset quality, weak loan growth.
• Management guiding for 18-20 percent AUM growth in the current financial year.
• Liquidity position comfortable; NIMs likely to improve going forward.

On Hindalco

JPMorgan

• Maintained ‘Overweight’ with a price target of Rs 330.
• Novelis continues to see strong performance across segments and markets.
• Continues to see strong demand across key markets.
• Expect more positive contract reset environment.
• Novelis expects to remain FCF positive even after large capex.

JM Financial

• Strong earnings delivery from Novelis; record high Ebitda driven by higher shipments.
• Robust performance at North America; other regions margin impacted by inventory reduction.
• Softening spreads to be offset by operating efficiencies.
• Expansion projects on track; Aleris acquisition to be completed by September 2019.

On Sectors

Morgan Stanley on Cement Sector

• Recent cement price hikes are sustaining well.
• May-19, the industry has raised prices further in the North and East.
• Costs still flattish vs. Q4 with potential upside risk from freight rates.
• Price hike reflects rising capacity utilisation and industry focus on profitability.

UBS on Indian Aviation

• InterGlobe Aviation: Upgraded to ‘Buy’ from ‘Sell’; hiked price target to Rs 1,940 from Rs 940.
• SpiceJet: Initiated ‘Buy’ with a price target of Rs 175.
• Industry dynamics turn more attractive.
• Significant international growth opportunity for domestic LCCs.
• Indigo: international growth not priced in.
• SpiceJet: cost structure improvement could drive further rerating.

CIMB on Indian Pharma

• U.S. generics pricing pressure eases but structural constraints remain.
• India’s branded generics market undergoing deep transformation.
• Indian policy makers to monitor pricing dynamics in U.S./China.
• Strong structural tailwinds from changing CDMO industry dynamics.
• Aurobindo Pharma: Initiated ‘Add’ with a price target of Rs 950.
• Dr. Reddy’s: Initiated ‘Add’ with a price target of Rs 3,260.
• IPCA Lab: Initiated ‘Add’ with a price target of Rs 1,190.
• Syngene International: Initiated ‘Add’ with a price target of Rs 680.
• Divi’s Lab: Initiated ‘Hold’ with a price target of Rs 1,850.

More Calls

HSBC on Alembic Pharma

• Maintained ‘Hold’; cut price target to Rs 575 from Rs 600.
• U.S. sales remain steady QoQ on new launches and few supply benefits; India sales remain sluggish.
• Upward trend to continue for operating costs on R&D pipeline and start-up costs.
• Look for progress in R&D efforts for U.S. market and recovery in India.

Morgan Stanley on Reliance Industries

• Downgraded to ‘Equal-weight’ from ‘Overweight’; hiked price target to Rs 1,349 from Rs 1,230.
• Expect RIL’s two-year earnings upswing to reverse.
• Rising glut in gas and polyster markets could also slow growth in 2020.
• Upside limited amid core business drags with no material capacity adds.

Futures –May Series

Nifty

• Nifty futures closed trading at 11,418.6, premium of 59 points versus 44 points.
• Nifty open interest up 2 percent adds 3.2 lakh shares in open interest.

Bank Nifty

• Bank Nifty futures closed trading at 29,145.7, premium of 151 points versus 130 points.
• Bank Nifty open interest down 1 percent sheds 18,000 shares in open interest.

Options

• Nifty PCR at 1.03 versus 1.13 (across all series)

Nifty Weekly Expiry 9 May

• Max open interest on call side at 11,500 (27.1 lakh shares)
• Max open interest at Put side at 11,400 (10.3 lakh shares)
• Max open interest addition seen at 11,400 Call (+21 lakh shares), 11,500 Call (+18 lakh shares), 11,450 Call(+14.9 lakh shares)
• Max open interest shedding seen at 11,800 Call (-7.7 lakh shares), 11,500 Put (-6.6 lakh shares), 11,700 Put (-6 lakh shares)

Nifty Monthly Expiry 30 May

• Max open interest on call side at 12,000 (16 lakh shares)
• Max open interest on Put side at 11,000 (24.6 lakh shares)

The Indian rupee extended declines for the fourth consecutive trading session against the U.S. dollar. The home currency depreciated as much as 0.3 percent to 69.92 against the greenback.

Indian equity benchmarks extended fall for the seventh consecutive trading session.

The declines were in line with Asian peers after the U.S. futures slipped as the clock ran down for an escalation in tariffs between the world’s two largest economies.

The S&P BSE Sensex fell as much as fell much as 0.59 percent to 37,564.87 and the NSE Nifty 50 fell as much as 0.31 percent to 11,301.35. The broader market index represented by the NSE Nifty 500 Index fell as much as 0.43 percent.

The market breadth was tilted in favour of sellers. About 832 stocks declined and 565 shares advanced on National Stock Exchange.

Seven out of 11 sectoral gauges compiled by NSE fell, led by the NSE Nifty Pharma Index’s 0.54 percent decline. On the flipside, the NSE Nifty Media Index was the top sectoral gainer, up 1.38 percent.

(With inputs from Bloomberg)

Shares of the telecom operator fluctuated between gains and losses to trade 0.7 percent higher at Rs 14.40.

Shareholders of Vodafone Promoter Mauritius and Vodafone Promoter Indian pledged about 44.39 percent stake, the company said in a filing. Vodafone Group owns the stake through 12 entities based in India and Mauritius. The stake is valued at close to Rs 18,304 crore. (Read the full story here)

The stock declined 12 percent in the past five days and fell 16 percent in the past 30 days, Bloomberg data showed.

• Federal Bank: About 10 lakh shares changed hands in a single block.
• Mindtree: About 26 lakh shares changed hands in a single block.

Buyers and sellers were not known immediately
Source: Bloomberg

The NSE Nifty 50 extended decline to trade below 11,300.

Shares of the jewellery maker rose as much as 1.9 percent to Rs 1,110 after announcing its fourth quarter results.

Key Earnings Highlights (Q4, YoY)

• Revenue up 20.7 percent to Rs 4,671 crore.
• Net profit up 4.4 percent to Rs 294.6 crore.
• Ebitda up 11.3 percent to Rs 455 crore.
• Margin at 9.7 percent versus 10.6 percent.
• Exceptional loss of Rs 70 crore.

Here’s what analysts had to say about Titan after the results announcement:

CLSA

• Maintained ‘Outperform’; hiked price target to Rs 1,225 from Rs 1,100.
• March quarter were impacted by one-offs – inventory valuation hit and ex-gratia pay-outs to employees.
• Jewellery: strong growth, record margin and positive outlook.
• Mixed performance for other segments.

JPMorgan

• Maintained ‘Overweight’ with a price target of Rs 1,200.
• Good March quarter; positive outlook and start to 2019-20.
• Jewelry – All round impressive performance.
• Titan remains one of the higher growth companies in our coverage universe.

UBS

• Maintained ‘Buy’ with a price target of Rs 1,250.
• Sustained strong performance in jewellery business.
• Optically depressed performance due to one-offs.
• Formalisation and wedding jewellery expansion continues.

Reliance Industries Ltd.’s market capitalisation fell below Rs 8 lakh crore. The stock extended declines for the fourth consecutive trading session and it set for its longest losing streak in over three months.

The scrip advanced 30 percent in the past 12 months, compared to a 6.4 percent gain in the Sensex.

KEC International (Q4, YoY)

• Stock fell as much as 4.2 percent to R 282.25.
• Revenue up 4.9 percent to Rs 3,841.2 crore.
• Net profit down 0.9 percent to Rs 193.9 crore.
• Ebitda up 7.9 percent to Rs 399.2 crore.
• Margin at 10.4 percent versus 10.1 percent.
• Deferred tax reversal of Rs 24.9 crore in base quarter
• Material costs down 19 percent to Rs 1,736.3 crore.
• Erection and Subcontracting expenses up 54 percent to Rs 1,048.2 crore.
• Board approves reappointment of Vimal Kejriwal as MD and CEO till March 2020.

Tata Communications (Q4, QoQ)

• Stock fell as much as 3.3 percent to Rs 540.65.
• Revenue down 0.6 percent to Rs 4,243.5 crore.
• Net loss at Rs 198.5 crore versus net profit at Rs 173.8 crore.
• Ebitda down 18.7 percent to Rs 685.3 crore.
• Margin at 16.1 percent versus 19.7 percent.
• Loss in associates to Rs 160.7 crore.
• Other expenses up 38 percent to Rs 1,105.1 crore.
• Deferred tax reversal of Rs 29.6 crore in base quarter.

Shriram Transport Finance (Q4, YoY)

• Stock fell as much as 3.5 percent to Rs 991.
• Net Interest Income up 5 percent to Rs 1,931.2 crore.
• Net profit down 22.4 percent to Rs 746 crore.
• Exceptional gain of Rs 139.7 crore in base quarter.
• Deferred tax payment of Rs 453 crore in base quarter.
• Declares dividend of Rs 7 per share.

Saregama India (Q4, YoY)

• Stock rose as much as 3.3 percent to Rs 539.90.
• Revenue up 17.6 percent to Rs 124 crore.
• Net profit down 25.1 percent to Rs 16.1 crore.
• Ebitda up 4.5 percent to Rs 16.3 crore.
• Margin at 13.1 percent versus 14.8 percent.
• Royalty expense up 3.2 times to Rs 14.6 crore.

CreditAccess Grameen (Q4, YoY)

• Stock fell as much as 10.5 percent to Rs 446.
• Net Interest Income up 27.5 percent to Rs 209.7 crore.
• Net profit up 6.4 percent to Rs 76.3 crore.

Gillette India (Q4, YoY)

• Stock fell as much as 3.7 percent to Rs 7,025.
• Revenue up 3.1 percent to Rs 465.5 crore.
• Ebitda up 23.8 percent to Rs 146.2 crore.
• Margin at 31.4 percent versus 26.1 percent.
• Net profit up 23.1 percent to Rs 87.8 crore.
• Lower employee and advertising cost aid Ebitda.
• Other income was up three times to Rs 3.3 crore.

Nifty’s 11,400 call option contract was among the most active Nifty option contracts on National Stock Exchange.

Premium on the contract fell 71.92 percent to Rs 8.10. Over 21 lakh shares were added to the open interest which stood at over 43.4 lakh shares.

The NSE Nifty Media Index halted its five-day falling streak and gained 3.68 percent. The sectoral gauge was the top gainer among the list of gauges compiled by National Stock Exchange.

• Tata Motors: About 12.3 lakh shares changed hands in a single block.
• Vodafone Idea: About 12.5 lakh shares change hands in a single block.

Buyers and sellers were not known immediately
Source: Bloomberg

Indian equity benchmarks were trading at day’s low. The S&P BSE Sensex fell over 200 points and the NSE Nifty 50 traded below 11,300.

The Indian rupee traded at day’s low and fell below 70 against the U.S. dollar.

Shares of Apollo Tyres fell as much as 4.8 percent to Rs 182.55 after announcing its fourth quarter results.

Key Earnings Highlights (Q4, YoY)

• Revenue up 5 percent to Rs 4,273 crore.
• Net profit down 66 percent to Rs 84 crore.
• Ebitda down 18 percent to Rs 423 crore.
• Margin at 9.8 percent versus 12.8 percent.
• One-time loss of Rs 100 crore due to IL&FS.

Asian Paints Ltd.’s quarterly during January-March period misses the lowest estimate.

The paintmaker reported a net profit of Rs 473 crore in the three months ended March, a fall of 1.6 percent from the year ago period, according to its stock exchange filing. The missed the lowest analyst estimate of Rs 530 crore tracked by Bloomberg.

Key Earnings Highlights (Q4, YoY)

• Revenue up 12 percent to Rs 5,018 crore.
• Ebitda down 2 percent to Rs 822 crore.
• Margin at 16.4 percent versus 18.7 percent.
• Shares of the company fell as much as 2.7 percent to Rs 1,348.50 after the results announcement.

Indian equity benchmarks ended lower for the seventh consecutive trading session, their longest losing streak in nearly three months.

The S&P BSE Sensex closed 0.6 percent or 230 points lower at 37,558.91 and the NSE Nifty 50 ended at 11,301.80, down 0.5 percent. The broader market index represented by the NSE Nifty 500 Index closed 0.43 percent lower.

The market breadth was tilted in favour of sellers. About 1,005 stocks fell and 734 shares advanced on National Stock Exchange.

Six out of 11 sectoral gauges compiled by NSE ended higher, led by the NSE Nifty Media Index’s 3.6 percent higher. On the flipside, the NSE Nifty Metal Index was the top sectoral loser, down 1.4 percent.