Sensex, Nifty Close At Record Highs Aided By Bharti Airtel, RIL
India’s stock benchmarks closed at record aided by gains in banking, metals, telecom and pharma stocks, amid positive global cues following Federal Reserve Chairman Jerome Powell's dovish comments that the U.S. central bank would not be in a hurry to hike rates.
The S&P BSE Sensex advanced 1.36% to 56,889.76. The 30-stock index rose to a record 56,958.27 levels in intraday trade. The NSE Nifty 50 advanced by a similar magnitude to 16,931.05, the first ever close above 16,900. In fact, the 50-stock index crossed 16,800 and 16,900 levels for the first ever time and advanced to a record 16,951.50 in intraday trade. Reliance Industries Ltd. contributed the most to the index gain, increasing 1.9%. Bharti Airtel Ltd. had the largest increase, rising 4.3%. Today, 43 of 50 shares rose, while 7 fell.
The broader indices outperformed their larger peers with both the S&P BSE MidCap and the S&P BSE SmallCap gaining over 1.5%. Barring S&P BSE Information Technology and S&P BSE Teck, all the other 17 sectoral indices compiled by the BSE Ltd. advanced, with S&P BSE Telecom gaining over 3.5% and S&P BSE Metal climbing over 2.5%.
The market breadth was skewed in favour of bulls. About 2,215 stocks advanced, 1,096 declined and 186 remained unchanged.
"Dovish commentary from Federal Reserve chairman in Jackson Hole Symposium lifted investors’ sentiments globally. No mention about actual timeframe for reversal of $120 billion monthly asset purchase programme by Jerome Powell and indications of no interest rate hike in the medium term essentially show that taper tantrum is still not in the sight in the near term, which augurs well for global equities. In our view, winding down of asset purchase programme by the Federal Reserve might not happen before November 2021, which is broadly being factored by market", Binod Modi, Head Strategy at Reliance Securities wrote in a note.
Coal India Gains The Most In 11 Weeks
Shares of Coal India Ltd. added 3.75% to Rs 143.75 apiece.
Trading volume was 8.96 million shares, 28% above the 20-day average of 7 million shares for this time of day.
The company trades at 6.3 times its estimated earnings per share for the coming year.
Analysts have 21 'buy', 4 'hold' and 3 'sell' recommendations on the stock.
The overall consensus price of analysts tracked by Bloomberg implied an upside of 20%.
Sunil Mittal At Bharti Airtel Investor Call
It's time to raise tariff.
Recent tariff increase has been received very well.
Happy to take baby steps to raise tariffs.
Expect pick up of Tariff, ARPU in the next few months.
Sees 2X net debt-to-EBITDA as comfort level.
Company to be more comfortable in its debt profile in 2-3 years.
Have large monetisable assets.
See ARPU rising to Rs 200 this financial year.
Have seen the worst in tariff wars, ARPU contraction.
Expect digital revenue to rise in the coming quarters.
India should see three private player scenario in telecom sector.
Bharti Telecom has no plan to sell more shares in Bharti Airtel.
Do not see significantly higher capex for 5G.
Zomato Shares Climb As Morgan Stanley, Goldman Sachs Initiate Coverage
Shares of Zomato Ltd. gained over 6% to Rs 132.70 apiece after Morgan Stanley and Goldman Sachs initiated coverage on the stock highlighting the food aggregator’s potential to expand into new, adjacent categories such as restaurant supplies and grocery, and its dominant market position, among others.
While Morgan Stanley initiated coverage on the online food delivery platform with an ‘equal-weight’ stance, Goldman Sachs rated it a ‘buy’, according to their research reports.
REC Plans First Loan Using Libor Heir: Bloomberg
REC Ltd., one of India’s biggest lenders to the power sector, will raise its first loan linked to the Libor alternative, joining the global move away from the debt-pricing benchmark.
The state-owned company will borrow as much as $75 million through a five-year loan linked to the Secured Overnight Financing Rate, or SOFR.
REC has mandated a Japanese bank for the loan and will draw down the facility for funding India power projects by mid-September.
Source: People familiar with the matter