Sensex, Nifty Decline For Second Day Dragged By Banking, I.T. Stocks

India's stock benchmarks declined, dragged by lossees banking and information technology stocks. The S&P BSE Sensex fell nearly 1% while the NSE Nifty 50 settled above 17,800, amid hawkish comments from U.S. Federal Reserve officials, decline in crude prices and prospects of fresh sanctions on Russia.

This is the second straight day in which the benchmarks have declined. The Sensex and Nifty logged their worst day in over two weeks on Wednesday's session. The S&P BSE Sensex fell 0.94% (equivalent of 566 points) to 59,610.41.

The NSE Nifty 50 declined by similar magnitude to close above 17,800.

The broader indices outperformed their larger peers for the second day in a row, with S&P BSE MidCap and S&P BSE SmallCap rising 0.4%. Ten of the 19 sectoral indices compiled by BSE Ltd. advanced with S&P BSE Utilities and Power rising nearly 2%. On the flipside, S&P BSE Information Technology shed nearly 1.5% while S&P BSE Finance lost 1.25%.

The market breadth was skewed in the favour of bulls. About 2,160 stocks advanced, 1,253 declined and 99 remained unchanged.

• Legal advisers indicated that approvals may take 15-18 months.

• Effective date of HDFC Bank deal after all approvals.

Source: Exchange filing

BLOOMBERG EXCLUSIVE

• Actis is nearing a deal to buy a portfolio of road assets from India's Welspun Group for about Rs 3,030.1 crore ($400 million).

• The buyout firm is in advanced talks for the assets and is set to beat out a number of rival bidders.

• A deal could give the conglomerate's road portfolio an enterprise value of about $1.2 billion.

• An agreement could be reached in the coming weeks.

• Talks could still fall apart and other bidders may emerge.

Source: People familiar with the matter

Shares of TVS Motor Co Ltd. rose over 1.6%, the most in a week, to Rs 647.3 apiece after the company announced collaboration with Jio-bp on Tuesday.

• The collaboration will focus on the creation of robust public EV charging infrastructure for electric two-wheelers and three-wheelers in the country, building on Jio-bp's growing network.

• Customers of TVS EVs are likely to gain access to the widespread charging network of Jio-bp, under the deal.

• The partnership will focus on creating a regular AC charging network and a DC fast-charging network.

• Of the 49 analysts tracking the company, 30 maintain 'buy', 10 suggest 'hold' and nine recommend 'sell'. The return potential on the stock is at 8.6%.

Source: Bloomberg, Exchange Filing

Food delivery apps Zomato, Swiggy confirmed that they are facing technical issues.

• Swiggy’s customer support handle tweeted it is facing technical constraints.

• Zomato’s support handle said the glitch is temporary.

Source: Twitter

• Hindustan Aeronautics reversed losses after the company signed an MoU with Israel Aerospace Industries (IAI) to convert civil passenger aircraft to multi mission tanker transport aircraft.

• The move is expected to provide new capabilities and cost effective markets solutions for India's defence ecosystem, the company said in an exchange filing.

Source: Exchange filing

Shares of Marico fell as much as 4.8%, the steepest decline in over four weeks, to Rs 517.85 after the company said it expected "marginal growth" in profit in quarter-ended March.

• Marico flagged subdued consumption trends, weak rural sentiment and rising inflation in commodities due to geopolitical tensions as major challenges, in its fourth-quarter business updated.

• CLSA maintained 'underperform' rating on the stock with the target price kept unchanged at Rs 530; an implied downside of 3%.

• CLSA expects gross margin/Ebitda margin to be stable YoY, while higher effective tax rate is likely to adversely impact earnings growth .

• Nirmal Bang downgraded the stock to 'accumulate' from 'buy' and kept target price unchanged, citing inflation and weak rural demand.

• Trading volume on the stock in nearly twice the 30-day average volume at this time of the day.

• Share price crossed below 200-day simple moving average, indicating potential downward price momentum.

• Of the 41 analysts tracking the company, 31 maintain 'buy', six suggest 'hold' and four recommend 'sell'. The return potential on the stock is at 10.2%.

Source: CLSA, Nirmal Bang notes, Bloomberg, Exchange Filing

IDBI Bank gains after CNBC-TV18 reports the Indian govt plans to invite expression-of-interest for stake sale in the lender in May.

• The government., which is looking to sell all or a part of its ~45% stake in IDBI Bank, plans to complete the transaction this fiscal year that ends in March 2023, the report said citing people it didn’t identify.

• Shares rise as much as 11%, most since Jan. 5

• Trading volume 2.9x three-month, full-day avg.; set for 4th day of advance.

• Minister of State for Communications Devusinh Chauhan said the MTNL-BSNL merger stands deferred due to “financial reasons including high debt of MTNL.”

• The merger was approved by the government in 2019.

Source: Parliament reply

The board of Saregama India Ltd. has approved splitting each share into 10. It has fixed the record date for determining the eligibility of shareholders as April 27.

The company also named Pankaj Chaturvedi as the new chief financial officer effective April 11. Presently, he is serving as the CFO at Go Airlines (India) Ltd.

Shares of the company gained as much as 4.5% to Rs 5,143.25 apiece today.

• The highest final offer stood at 25% of average IBM monthly prices of iron ore.

• JSW to take all requisite steps to obtain letter of intent to execute lease deed.

Source: Exchange Filing

India's stock benchmarks declined, dragged by banking and information technology stocks. The S&P BSE Sensex and NSE Nifty 50 are off day's low, as power and metal stocks offset some of the losses.

The Sensex fell 0.56% to 59,838.47. The 30-stock gauge fell over 1.1% to 59,509.84 in intraday trade. The Nifty also declined by similar magnitude to 17,880.30.

The broader indices outperformed their larger peers with S&P BSE MidCap gaining over 0.5% and S&P BSE SmallCap adding 0.7%. Thirteen of the 19 sectoral indices advanced with S&P BSE Power and Utilities rising over 2%. On the flipside, the S&P BSE Information Technology fell over 1%.

The market breadth was skewed in the favour of bulls. About 2,239 stocks advanced, 1,072 declined and 102 remained unchanged.

Shares of Rain Industries fell nearly 6%, the steepest intraday decline in over four weeks, after the company said that it shut down one of its kilns due to lack of adequate raw material.

• Rain Industries specialises in the production of cement and calcined petroleum coke.

• In an exchange filing, the company said that due to the lower allocation of raw petroleum coke by Directorate General of Foreign Trade, one of the kilns have been shut, which will lead to loss of 20 Mega Watt of waste-heat power generation to the grid.

• Trading volume on the stock is more than 1.5 times the 30-day average volume at this time of the day.

Source: Exchange filing, Bloomberg

Shares of Coastal Corp Ltd. rose over 12%, the most in six weeks, after the shrimp processor completed trial production of new capacity in Kakinada SEZ in South India.

• The company said that the new plant will add a production capacity of 325 million tonnes per day. The commercial production will begin in next 10-15 days.

• Coastal Corp had ivnested Rs 70 crore for the unit, which is expected to augment the company's value-added-supply to various parts of the world.

• Besides this, the company also it will commence the solar power project of 3.6 Mega Watt capacity in Srikakulam in Andhra Pradesh by next week. This initiative is to enable the company to move towareds renewable energy, reduce carbon footprint as well as cut power cost.

Source: Exchange filing, Bloomberg

Shares of Wockhardt Ltd. rose over 7%, the most in three sessions to Rs 313.2 apiece.

• Billionaire investor Rakesh Jhunjhunwala has bought 5 lakh shares of the company in Q4FY2021-22, according to exchange filing.

• At the end of December, Rakesh Jhunjhunwala held 25 lakh shares of the company. According to NSE, Jhunjhunwala held 30 lakh shares as on March 28.

• Trading volume is more than quadruple the 30-day average volume for this time of the day.

Source: NSE, Bloomberg

• Mahanagar Gas has hiked the price of CNG in Mumbai by Rs 7 per kg.

• The cost of PNG has also been hiked by Rs 5 per unit.

Source: Bloomberg

Shares of hotel stocks advanced after ICICI Securities saw a confluence of positives for the sector with leisure demand remaining strong and business travel seeing a strong leg-up.

• ICICI Securities expects business travel to pick up with the reopening of offices, resumption of international flights.

• The brokerage reiterates 'buy' and raised target on Indian Hotels and Lemon Tree.

Source: ICICI Securities note, Bloomberg

• The order was passed after both sides agreed on resuming the arbitration proceedings.

• The arbitration proceedings were stayed earlier this year by a division bench of the Delhi High Court.

• Retail loans fell 8% year-on-year, but rose 3% sequentially

• Corporate advances were up 19% year-on-year and 6% quarter-on-quarter

• Total advances rose 3% YoY to Rs 61,929 crore

• Total deposits rose 8% YoY to Rs 79,005 crore, up 7% QoQ

Source: Exchange notification

Shares of Sugar stocks surged in trade

• Industry body ISMA said that the country's sugar export may touch 85 lakh tonnes in the ongoing marketing year ending September, on Monday.

• According to ISMA, sugar production reached 309.87 lakh tonnes till March, higher than 278.71 lakh tonnes YoY.

Source: Bloomberg

• Marico cut to 'accumulate' from 'buy' at Nirmal Bang; price target set at Rs 585, implied upside of 11%

Source: Bloomberg

Maturities across the India sovereign yield curve were little changed in Wednesday morning trading.

• The 1-year yield remained unchanged at 4.706%

• The 10-year yield rose 1.5bps to 6.915%

• The 19-year yield remained unchanged at 7.25%

• The 2-year-10-year yield spread was 190.2bps, vs previous close 189.5bps

Source: Bloomberg

Maruti Suzuki has given an advance intimation regarding price increase in April, 2022.

• In an exchange filing, the company said that the cost of the vehicles has been adversely impacted due to rise in input costs and hence a price hike has become necessary.

• Maruti Suzuki said that the price increase, which will be announced in April, will be different for various models.

Source: Exchange filing

Bharat Electronics has 1 million shares change hands in a large trade.

ICICI Prudential has 1 million shares change hands in a large trade.

Details of buyers, sellers are not known immediately.

Source: Bloomberg

Shares of Tata Steel rose 2.3% after the company achieved highest ever annual crude steel production of 19 million tonnes, up 13% YoY.

• During Q4FY2021-22, crude steel production rose 2% QoQ to 4.9 million tonnes, according to the quarterly update.

• Deliveries grew 16% sequentially to 51.2 lakh tonnes-- the highest ever for a quarter.

• Of the 34 analysts tracking the company, 30 maintain 'buy', three suggest 'hold' and one recommends 'sell'. The overall consensus price of analysts tracked by Bloomberg implies an upside of 19%.

Source: Exchange Filing, Bloomberg

• Services PMI rises to 53.6 in March from 51.8 in February.

Source: IHS Markit

Shares of Adani Transmission rose over 1% and Adani Green gained over 2% to record high levels after the group’s holding company said it would consider raising funds on April 8.

• Adani Enterprises, the holding firm for the Indian logistics-to-energy conglomerate, Adani Green Energy and Adani Transmission will consider raising funds via various options including rights, preferential issue and institutional placement of shares and bonds, according to separate exchange filings.

Source: Bloomberg, Exchange filings

Shares of Tata Power rose over 5.25% to a record Rs 288.

• Over the last two sessions, the stock added 13%. Trading volume on the stock is nearly nine times the 30-day average volume at this time of the day.

• Relative strength index on the stock is at 78, suggesting it may be overbought.

• Resurgent Power (the company in which Tata Power holds 26% stake and ICICI Bank 74%) acquired 100% stake in NRSS XXXVI Transmission Ltd. for Rs 127 crore, along with additional payouts.

• The acquisition involves purchase of equity against cash consideration and one-time settlement of the outstanding debt in NRSS.

• The acquisition is in line with Resurgent Power's objective of investing in stressed power companies in India. The approval for the acquisition was obtained from Central Electricity Regulatory Commission on March 8 and it was completed on April 4.

• The revenue from operations of NRSS over the last three years was Rs 1.32 crore (FY2018-19), Rs 1.32 crore (FY2019-20) and Rs 1.32 crore (FY2020-21).

• Of the 24 analysts tracking the company, 12 maintain 'buy', five suggest 'hold' and seven recommend 'sell'. The return potential on the stock is at -21.7%.

Source: Exchange filing, Bloomberg

Shares of Barbeque Nation Hospitality Ltd. fell 7.99%, the most in nearly six weeks since Feb. 24.

• About 4.35 million shares, representing 11.2% of equity changed hands in two large trades.

• Details of the buyers, sellers are not known immediately.

• Trading volume on the stock is 537 times the 30-day average volume at this time of the day.

Source: Bloomberg

India's stock benchmarks opened lower, dragged by banking and realty stocks, amid statements from Federal Reserve officials hinting at rapid paring of balance sheet to curb inflation, decline in oil prices and rising geopolitical tensions due to Russia-Ukraine crisis.

The S&P BSE Sensex fell 0.57% to 59,832.04. The NSE Nifty 50 also declined by similar magnitude to 17,868.65.

The broader indices outperformed their larger peers with the S&P BSE MidCap adding 0.1% and S&P BSE SmallCap rising 0.3%. Ten of the 19 sectoral indices compiled by BSE Ltd. advanced with S&P BSE Telecom rising over 1.25%. On the flipside, S&P BSE Banking shed 0.9%.

The market breadth was skewed in the favour of bulls. About 1,687 stocks advanced, 849 declined and 103 remained unchanged.

• ICICI Prudential raised to 'buy' from 'hold' at Emkay Global; price target set at Rs 620, an implied upside of 22%.

• Bandhan Bank raised to 'buy' from 'reduce' at Edelweiss Capital; price target set at Rs 370, an implied upside of 17%

Source: Bloomberg

Indian government bonds may track an overnight slide in U.S. Treasuries following hawkish comments from Federal Reserve Governor Lael Brainard. Traders are awaiting March PMI data.

• USD/INR fell 0.3% to 75.3275 on Tuesday

• 10-year yields little changed at 6.9% on Tuesday

• Global funds bought a net Rs 375 crore of India stocks Tuesday: NSE

  • They sold Rs 290 crore of sovereign bonds under limits available to foreign investors, and added Rs 614 crore of corporate debt

  • State-run banks sold Rs 1,300 crore of sovereign bonds on April 5: CCIL data. Foreign banks sold Rs 528 crore of bonds.

Source: Bloomberg

Shares of billionaire Gautam Adani-controlled firms may move after three of its entities including the group’s holding company said they would consider raising funds on April 8.

• Adani Enterprises, the holding firm for the Indian logistics-to-energy conglomerate, Adani Green Energy and Adani Transmission will consider raising funds via various options including rights, preferential issue and institutional placement of shares and bonds, according to separate exchange filings

• Separately, Adani Global Ltd. Mauritius, a unit of Adani Enterprises, acquired a minority stake in Israel-based medical technology company Forsight Robotics Ltd for $20 million, according to an exchange filing

• Stocks to watch: Adani Enterprises, Adani Green Energy, Adani Transmission, Adani Ports and Special Economic Zone, Adani Total Gas, Adani Wilmar.

Source: Bloomberg

• Indraprastha Gas has hiked the price of CNG in Delhi by Rs 2.5 per kg to Rs 66.62 effective today.

• For Ghaziabad, Noida and Greater Noida, CNG will cost Rs 69.18 per kg, while in Gurugram, it will cost Rs 74.94 per kg.

Source: ANI

India’s Enforcement Directorate have asked senior Google executives to provide a detailed list of lending apps in the country hosted by Google Play as part of the loan fraud investigation, Business Standard reports, citing an unnamed person with knowledge of the matter.

• Agency probing 38 non-banking financial companies and more than 300 fintech firms for providing instant, micro-financing through mobile apps and seeking high interests from defaulters: report

• An email sent to Google spokesperson was unanswered: report

Adani Global, a wholly owned subsidiary of Adani Enterprises has bought minority stake by way of newly issued shares of Israeli firm Forsight Robotics for $20 million (nearly Rs 151 crore)

• Forsight Robotics, incorporated in 2020, specialises in medical technology.

• The company had nil turnover for financial years ending December 31, 2020 as well as 2021.

• Adani Enterprises said that the acquisition is in line with its strategy to invest in firms that provide synergistic benefits to Adani Group.

Source: Exchange filing

Nirmal Bang

• Shares of PVR and Inox Leisure rose 48% and 50% in Q4, due to opening up after the third way, strong response to content and proposed merger of the two players.

• PVR, Inox Leisure merger will create a formidable player in the sector with a significant bargaining power.

• Emergence of Omicron variant hurt the sectoral performance in the first one and a half months of Q4FY2021-22, as film releases were postponed due to fresh restrictions in several states.

• Second half of Q4 has been good for the sector with multiple films surpassing Rs 100 crore mark in gross box office collections.

• The sentiment among audience has been gradually improving.

• Believes that the performance in March 2022 is just a trailer for an anticipated stellar performance in FY2022-23.

• Expects Q4FY2021-22 to see significantly higher revenue (up 250-270-%) compared to Q4FY2020-21.

• Expects margins to contract for Inox Leisure compared to Q3FY2021-22 due to no cost cutting during the third wave and higher rental costs QoQ.

• Expects both Inox Leisure and PVR to have burnt cash in January and February before making money in March.

• Expects rentals to go back to pre-covid levels.

• Expects advertising part of the business to be the last segment to recovery.

• Maintains 'buy' on both PVR and Inox Leisure with target prices of Rs 2,383 and Rs 594, respectively.

• Key risk to the stock prices would be the intervention in the merger by CCI leading to divestment of screens.

Source: Nirmal Bang note

A consortium comprised of Singapore's GIC, private equity firm ChrysCapital and Bandhan group is likely to emerge as the favorite to acquire IDFC Mutual Funds, Moneycontrol reports, citing multiple unnamed sources with knowledge of the matter.

• Deal is likely to be discussed in today's board meet of IDFC: Report.

• PE firms Warburg Pincus and Kedaara Capital have joined Invesco MF for a competing bid: Report

Motilal Oswal

• Credit growth in the sector is picking up with signs of revival visible in systemic growth.

• Credit growth accelerated to nearly 8.5% YoY as of March 11, underpinned by strong disbursements across segments.

• Disbursement growth across retail products has surpassed pre-Covid levels.

• Corporate segment too witnessed revival with focus on high-rated corporates.

• Expects capex cycle to pick up in H2FY2022-23, driving recovery in loan growth over the fiscal year.

• Expects home, vehicle, tractor, unsecured and small business to do well in Q4 while CV and MFI segments are likely to trail the normalised levels.

• Sees healthy momentum building in credit cards business.

• Estimates systemic loan growth of 9%/11.8% YoY for FY22/FY23.

• Expects its banking coverage universe to deliver 7%/52% PPoP/PAT growth in Q4FY2021-22 respectively.

• Projects private and PSU banks to report earnings growth of 30% and 36% in FY2022-23.

• Low slippages and healthy recoveries are expected to result in overall improvement in asset quality.

• Estimates private banks to report PPoP growth of 10% YoY and PAT growth of 38% YoY in Q4FY2021-22.

• Expects earnings of private banks to remain strong, aided by healthy business growth/fee income and reduction in credit cost.

• Deployment of excess liquidity and pick-up in loan growth are expected to lead to steady trend in margins of private banks.

• Forecasts NII growth of 19% YoY for private banks, with ICICI Bank at 24%, Axis Bank at 23%, Kotak Mahindra Bank at 20% and HDFC Bank at 13% in Q4FY2021-22.

• Remains optimistic on asset quality of private banks

• Forecasts public sector banks to witness continued tranction in the operating performance, aided by growth recovery and reduction in provisions.

• Expects AU Small Finance Bank to report uptick in operating performance and earnings due to recovery in loan growth, NII growth and low provisions.

• Prefers ICICI Bank, SBI, HDFC Bank, AU Small Finance Bank and SBI Life as the top picks in the sector.

Source: Motilal Oswal Note

• Petrol, diesel prices have been hiked by 80 paise, making this the 14th hike in the last 16 days.

• Price of petrol and diesel in Delhi is Rs 105.41 per litre and Rs 96.67 per litre respectively today.

• In Mumbai, petrol and diesel prices per litre are Rs 120.51 and Rs 104.77 respectively.

Source: ANI

• Indraprastha Gas: InCred Earnest Innovation Partners initiated coverage of the stock with a recommendation of 'reduce'; target price set at Rs 277, an implied downside of 29%.

• Mahanagar Gas: InCred Earnest Innovation Partners initiated coverage of the stock with a recommendation of 'reduce'; target price set at Rs 642, implied downside of 23%.

• Gujarat Gas: InCred Earnest Innovation Partners initiated coverage of the stock with a recommendation of 'reduce'; target price set at Rs 410, implied downside of 21%.

Source: Bloomberg

• Tata Steel: The company reported annual crude steel production of 1.9 crore tons, with a growth of 13% YoY. During Q4 FY 2022, crude steel production rose 2% QoQ at 49 lakh tons. Deliveries for Q4 FY22 grew by 16% QoQ to 51.2 lakh tons, the highest ever quarterly deliveries.

• Marico: The company’s revenue growth is in low-single digits and volumes were marginally positive. Parachute coconut oil volumes were marginally lower YoY, while value added hair oil segment grew in low-single digits in value terms. Gross margins to remain unchanged over last year. Expect marginal profit in Jan-March. International business posted double-digit growth in constant currency terms.

• Adani Green/Adani Enterprises: To consider raising funds on April 8 by way of a rights issue, preferential allotment, including a qualified institutions placement or through any other mode and/or combination.

• Ruchi Soya: The company allotted 6.61 crore shares offered via FPO. It raised an aggregate amount of Rs 4,300 crore.

• Reliance/TVS Motors: The two companies will collaborate to explore the creation of a robust public EV charging infrastructure for electric two-wheelers and three-wheelers.

• Gufic: The company received DCGI approval for Thymosin Alpha-1 (Immunocin α - A Brand of Gufic for the said drug) as an add-on therapy for the treatment of moderate-to-severe COVID-19 patients requiring ventilator support.

• Tata Consultancy: The company will build Kansas Department of Labor’s unemployment insurance system transforming a legacy mainframe platform from the 1970s into a cloud-based system.

• Tata Steel Long Products: The company crude steel production in Q4 FY 2022 stood at 1.66 lakh tons. It grew by 6% YoY in FY22. Steel sales volumes have increased by 2% YoY in FY22, with a higher share of rolled product sales. In Q4 FY22, Direct Reduced Iron production grew by 16% QoQ which in turn drove 21% QoQ growth in sales volume.

• Bandhan Bank: The bank reported loans and advances of over Rs 1 lakh crore as on March 31, 2022, a growth of 16% YoY. Total deposits grew 24% YoY at Rs 77.98 crore. CASA ratio stood at 41.6% in Q4. Collection efficiency for the month of March stood at 96%.

• UGRO Capital: The company filed prospectus for public issue of non-convertible debentures up to Rs. 100 crore.

• Rain Industries: The company has discontinued shut down one Kiln due to lower allocation of RPC by DGFT for the FY 2022-23 [RAIN is facing RPC shortfall to the tune of 40%] than in the previous years and the lack of sufficient raw materials. The shutdown of Kiln will also result into net loss of 20 MW of waste-heat power generation to the grid.

• Oriental Hotels: To consider declaration of dividend on April 15.

• Dish TV: The company received RBI nod to divest its stake in its Sri Lankan arm.