Sensex, Nifty Snap Four-Day Losing Streak Aided By ICICI Bank

Indian equity benchmarks snapped a four-losing streak in a volatile session, aided by gains in banking stocks.

The S&P BSE Sensex index rose 0.24% to 60,967.05. The NSE Nifty 50 Index added 0.06% to 18,125.40. Both the benchmarks slipped as much as 0.75% and rose over 0.75% in intraday trade.

The broader indexes underperformed their larger peers with both the S&P BSE MidCap index and the S&P BSE SmallCap indexes shedding over 1.6%. Barring S&P BSE Bankex and S&P BSE Finance, all the other 17 sectoral indexes compiled by BSE Ltd. declined, with the S&P BSE Realty index falling over 2.5%

The market breadth was skewed in favour of bears. About 1,044 stocks advanced, 2,312 declined and 174 remained unchanged.

JSW Steel Ltd. will invest Rs 150 crore ($20 million) to set up 1,20,000 tonnes a year colour-coated steel mill at Pulwama in Kashmir, according to a statement from the company.

Home Minister Amit Shah presented land allocation papers to JSW Steel Chairman Sajjan Jindal.

• Shares of Torrent Pharmaceuticals Ltd. rose over 5.2% in intraday trade, the most in five months, to Rs 3,124.85 apiece. The company is scheduled to report its earnings for the September quarter on Tuesday.

• Trading volume was 15% above the 20-day average for this time of the day.

• The company trades at 39 times its estimated earnings per share for the coming year.

• Analysts have 15 'buy', seven 'hold' and seven 'sell' recommendations on the stock.

PB Fintech, the parent of Indian online insurance aggregator Policybazaar, and One 97 Communications Ltd. that operates Paytm have won SEBI's approval to launch IPOs, according to the latest update issued by the market regulator.

SEBI also approved planned IPOs of ESAF Small Finance Bank, Sapphire Foods, Anand Rathi Wealth, HP Adhesives and Tarsons Products

• India's plan to privatise BPCL has run into rough weather

• Bidders struggling to find partners and spread their financial risks.

• Vedanta Group, Apollo Global and I Squared Capital talking to global energy giants and pension funds.

• Some bidders finding it difficult to invest due to sustainability rules.

Source: People familiar with the matter

• India has signed a preliminary agreement with Russia for importing metallurgical coal: Steel Minister Ram Chandra Prasad Singh

• India will seek application for specialty steel investments under PLI plan: Steel Minister

• SAIL examining bidding for government's PLI scheme: Soma Mondal, Chairman, SAIL.

• Reliance Industries reinstated 'hold' at IDBI Capital Market; Price target: Rs 2,825.

• Supreme Industries raised to 'hold' at IDBI Capital Market; Price target: Rs 2,702.63.

• Supreme Industries raised to 'buy' at BOB Capital Markets; Price target: Rs 2,735

Source: Bloomberg

Shares of Colgate-Palmolive India Ltd. slipped after the company reported net income for the second quarter that missed the average analyst estimate.

September quarter results (Consolidated, QoQ)

• Net income up 15.38% at Rs 269.17 crore vs Rs 233.23 crore (Bloomberg Consensus Estimate: Rs 290 crore)

• Revenue up 16% at Rs 1,343.96 crore vs Rs 1,157.86 crore (Estimate: Rs 1,370 crore)

• Total costs at Rs 998.05 crore vs Rs 856.99 crore

• Other income at Rs 6.51 crore vs Rs 5.21 crore

• Company declared a first interim dividend of Rs 19 per equity share of Re 1 each (face value) for the Financial Year 2021-22. The record date for the interim dividend is November 2. The company also approved the reappointment of M Chandrasekar as a Whole-time Director for five years with effect from January 2, 2022.

Of the 36 analysts tracking the company, 20 maintained 'buy', 12 maintained 'hold' and four maintained 'sell' recommendations. The overall consensus price of analysts tracked by Bloomberg implied an upside of 17%.

United Spirits Ltd. is lower for the eighth straight day, on track for the longest losing streak since the period ended May 15, 2018.

United Spirits has lost a total of 8.3% during the streak while the Sensex increased 1.3%.

United Spirits will report its earnings for the quarter ended September on Wednesday. The company beat EPS estimates four time in the past eight quarters.

Shares of SRF Ltd. shed nearly 4.4% to Rs 2,120 apiece after the company reported net income for the second quarter that missed the average analyst estimate.

September Quarter Results (Consolidated, QoQ)

• Net income down 3.2% at Rs 382.45 crore vs Rs 395.28 crore (Bloomberg Consensus Estimate: Rs 420 crore)

• Revenue up 5.17% at Rs 2,838.97 crore vs Rs 2,699.40 crore (Estimate: Rs 2,757 crore)

• Total costs at Rs 2,317.67 crore vs Rs 2,178.27 crore

• Other income at Rs 11.12 crore vs Rs 13.78 crore

Of the 25 analysts tracking the company, 18 maintained 'buy', five maintained 'hold' and two maintained 'sell' recommendations. The overall consensus price of analysts tracked by Bloomberg implied a downside of 15.2%

Bharat Forge Ltd. has announced a Voluntary Retirement Scheme for its permanent employees. Employees age over 40 years and have completed 10 years of service at its Mundhwa plant in Pune are eligible for the scheme.

Of the 29 analysts tracking the company, 24 maintained 'buy', two maintained 'hold' and five maintained 'sell' recommendations.

• Supreme Industries raised to 'buy' at Elara Securities India; Price target: Rs 3,099

• Minda Corp rated 'new buy' at Elara Securities India; Price target: Rs 213

Source: Bloomberg

Ramco Cements Ltd. reported net income for the September quarter above average analyst estimate

September Quarter Earnings (Consolidated, QoQ)

• Net income up 205.32% at Rs 519.12 crore vs Rs 170.02 (Bloomberg Consensus Estimate: Rs 174 crore)

• Revenue up 20.58% at Rs 1,453.08 crore vs Rs 1,205.08 crore (Estimate: Rs 1,350 crore)

• Total costs at Rs 1,231.60 crore vs Rs 988.46 crore

• Other income at Rs 7.22 crore vs Rs 5.31 crore

Of the 33 analysts tracking the company, 19 maintained 'buy', eight maintained 'hold' and six maintained 'sell' recommendations. The overall consensus price of analysts tracked by Bloomberg implied an upside of 16.6%

India's stock benchmarks shrugged off the early losses to advance in a volatile session, aided by gains in banking stocks.

The S&P BSE Sensex rose 0.32% at 61,015.45. The NSE Nifty 50 index declined 0.10% to 18,146.45. ICICI Bank Ltd. contributed the most to the index gain and had the largest move, increasing 12.5%. In midday trading, 12 of 50 shares rose, while 38 fell.

The broader indices underperformed their larger peers with S&P BSE MidCap and S&P BSE SmallCap indexes declining 1.5%. Barring S&P BSE Finance, S&P BSE Bankex and S&P BSE metal indexes, all the other 16 sectoral indexes compiled by the BSE Ltd. declined, with S&P BSE ‌Realty, Consumer Discretionary and Consumer Durables indexes falling nearly 2%. On the flipsad, S&P BSE Bankex index rose over 3%

The market breadth was skewed in favour of bears. About 987 stocks advanced, 2,245 declined and 183 remained unchanged.

• Pent-up demand from India's affluent, whose spending has helped power the economic recovery, could taper off over the next two quarters.

• The pent-up demand story is definitely going to sustain, over roughly the next three to six months.

• The key question is, as India moves towards 2022, what is going to drive the growth story as this pent-up demand fizzles out.

• Going forward, the recovery either has to be led by the government spending on infrastructure or residential real estate, with mortgage rates a decade low.

Tanvi Gupta Jain, Chief Economist, UBS Securities India

Source: Interview to Bloomberg TV

Shares of Coforge Ltd. shed over 12% in intraday trade to Rs 4,726.6 apiece after the company reported its September quarter numbers before market open today.

Second Quarter Results (Consolidated, QoQ)

• Net income up 22.7% at Rs 161.5 crore vs Rs 131.2 crore QoQ

• Revenue up 7.4% at Rs 1,569.4 crore vs Rs 1,461.6 crore

• Total costs at Rs 1,371 crore vs Rs 1,314.5 crore

• Other income at Rs 7.7 crore vs Rs 16.1 crore

Commentary & Context

• Company aims at least 22% constant currency growth during FY22.

• Company aims adjusted Ebitda margin of 19% for FY22.

Of the 27 analysts tracking the company, 17 maintained 'buy', five maintained 'hold' and five maintained 'sell' recommendations. The overall consensus price of analysts tracked by Bloomberg implied an upside of 7.9%.

• Indian bonds edge higher as traders viewed the minutes of the central bank’s October meeting as dovish. The rupee trades lower.

• 10-year yields down 3bps to 6.34%; 5-year yield drops 1bp to 5.73%

• USD/INR up 0.2% at 75.07

Source: Bloomberg

• PVR raised to 'buy' at Emkay Global; Price target: Rs 1,880

• Inox Leisure raised to 'buy' at Emkay Global; Price target: Rs 535

• JSW Steel raised to 'outperform' at IDFC Securities; Price target: Rs 840

Source: Bloomberg

• Longer-term India sovereign securities gained in Monday morning trading.

• The 1-year yield remained unchanged at 4.28%

• The 10-year yield fell 2.3bps to 6.341%

• The 14-year yield fell 2bps to 6.835%

• The 1-year-10-year yield spread was 206.1bps, vs previous close 208.3bps

Source: Bloomberg

• MCX cut to 'add' at ICICI Securities; Price target: Rs 1,965

• Federal Bank reinstated 'buy' at Asian Markets; Price target: 125

• ICICI Bank reinstated 'buy' at Asian Markets; Price target: 950

Source: Bloomberg

Shares of Gland Pharma Ltd. shed nearly 5% in intraday trade to Rs 3,512.4 apiece after the company reported net income below the average analyst estimate for the quarter ended September.

Gland Pharma Q2FY22 (Consolidated, YoY)

• Net profit up 38% at Rs 302.08 crore Vs Rs 218.85 crore (Estimate: Rs 307 crore)

• Revenue up 30% at Rs 1,080.46 crore Vs Rs 831.50 crore (Bloomberg estimate 1,084 crore)

• Ebitda up 27% at Rs 376.59 crore Vs Rs 297.64 crore (Estimate: 389 crore)

• Margin at 34.9% Vs 35.8%

Of the 14 analysts tracking the company, 10 maintained 'buy', two maintained 'hold' and two maintained 'sell' recommendations. The overall consensus of analysts tracked by Bloomberg implied an upside of 17.6%.

• TVS Motor Company Ltd. signed a tri-party deal with Bahwan International Group, according to which ARATA International, a subsidiary of Bahwan Group, will be the new distributer.

• Bahwan Group intended to operate over 30 dealerships for TVS Motor, including state of art facilities in all the major cities of Iraq.

Source: Exchange Filing

• HDFC Life raised to 'buy' at Kotak Securities; Price target: Rs 825.

• Hindustan Zinc cut to 'add' at Kotak Securities, Price target: Rs 355

• Macrotech raised to 'buy' at Kotak Securities; Price target: Rs 1,260.

Source: Bloomberg

Shares of ICICI Bank Ltd. rose 9% in intraday trade to a record Rs 827.65 apiece after the lender reported a record profit for the September quarter, aided by loan growth and core income.

Net profit for the quarter-ended September rose 29.6% to Rs 5,510.95 crore, as compared with Rs 4,251 crore a year ago. Net interest income was up 24.8% over last year to Rs 11,689.7 crore. It's net NPA ratio fell to below 1% while the gross NPA ratio fell to 4.82%. ICICI Bank reported the lowest level of net NPAs in nearly seven years.

All the 52 analysts tracking the company maintained 'buy' recommendations. The overall consensus price of analysts tracked by Bloomberg implied an upside of 7%. The relative strength index on the stock was 82, suggesting that it may be overbought.

Shares of Reliance Industries Ltd. rose 2% in intraday trade to Rs 2,680 apiece after the company reported net profit above average analyst in the September quarter, post market hours Friday.

RIL Q2FY22 (Consolidated, QoQ)

• Revenue up 20% at Rs 1,67,611 crore Vs Rs 1,39,949 crore

• Net profit up 11.50% at Rs 13,680 crore Vs Rs 12,273 crore

Reliance Retail Q2FY22 (Consolidated, QoQ)

• Revenue up 19% to Rs 39,926 crore Vs Rs 33,566 crore

• Net profit up 76% to Rs 1,695 crore Vs Rs 962 crore

• Ebitda up 50% at Rs 2,913 crore Vs Rs 1,941 crore

• Margins at 7.3% Vs 5.8%

Of the 36 analysts tracking the company, 22 maintained 'buy', nine maintained 'hold' and five maintained 'sell' recommendations. The overall consensus price of analysts tracked by Bloomberg implied a downside of 1.4%.

Indian equity benchmarks opened little cam, dragged by information technology, auto, fmcg and realty stocks

The S&P BSE Sensex shed 0.1% to 60,760.58. The NSE Nifty 50 declined by a similar magnitude to 18,066.40. Kotak Mahindra Bank Ltd. contributed the most to the index decline, decreasing 2.0%. Divi's Laboratories Ltd. and IndusInd Bank Ltd. had the largest drop, falling nearly 3%. In early trading, 41 of 50 shares fell, while 9 rose.

The broader indexes underperformed their broader peers with the S&P BSE MidCap index and the S&P BSE SmallCap shedding over 1.5%. Fifteen of the19 sectoral indexes compiled by BSE Ltd. declined, with the S&P BSE Realty index falling by nearly 3.5%.

The market breadth was skewed in favour of bears. About 864 stocks advanced, 1,828 declined and 137 remained unchanged.

Shares of non-bank finance companies may move after the Reserve Bank of India said it will cap the amount that investors can borrow to invest in companies’ first-time share sales. 

Lenders can offer up to 10m rupees per borrower for new share listings when the limit is implemented by lenders from April

In Focus: Bajaj Finance Ltd., Sundaram Finance, Shriram City Union Finance, Aditya Birla Capital, Edelweiss Financial Services, IIFL Finance

Indian bond traders will parse the minutes of RBI’s October meeting for cues about the future path of policy normalization.

• India’s monetary policy makers turned increasingly confident that the economic recovery has momentum, allowing the central bank space to focus on dampening inflationary pressures, the central bank said in minutes released after the close of markets on Friday

• While five members voted to keep the policy stance accommodative, one member said short-term rates need to be raised to show the central bank’s seriousness in fighting price pressures. Not all shared that sense of urgency, according to minutes of their last meeting on Oct. 6-8

• RBI Governor Shaktikanta Das will address the National Academy of Audit and Accounts at 11 a.m. Mumbai time

• USD/INR up 0.1% at 74.8963 on Friday

• 10-year yields rose 3bps to 6.36% on Friday; yields rose after auction cutoffs disappointed

• Global funds sell net Rs 2,700 crore of India stocks Friday: NSE

• They bought Rs 1,110 crore of sovereign bonds under limits available to foreign investors, and withdrew Rs 468 crore of corporate debt.

• State-run banks bought Rs 3,750 crore of sovereign bonds on Oct. 22: CCIL data. Foreign banks sold Rs 2,310 crore of bonds

Source: Bloomberg

• PVR raised to 'reduce' at Spark Capital Advisors; Price target: Rs 1,500

• Heritage Foods raised to 'buy' at Jefferies; Price target: Rs 510

• Jubilant Pharmova raised to 'add' at ICICI Securities; Price target: Rs 678

• Biocon raised to 'buy' at Centrum Broking; Price target: Rs 437

• LIC Housing raised to add at ICICI Securities; Price target: Rs 447

Source: Bloomberg