Sensex, Nifty Begin New Year With Best Week In Four Months

India's stock benchmarks logged the best week in four months to start 2021 on a positive note.

Banking stocks led the rally with the Nifty Bank and Nifty PSU Bank indices leading the weekly sectoral gains.

On Friday's session, the S&P BSE Sensex rose 0.24% to 59,744.65. The 30-stock gauge rose to 60,130.18 in intraday trade before paring the gains. The NSE Nifty 50 also advanced by similar magnitude to 17,812.70.

Grasim Industries Ltd. had the largest increase, rising 4.5%. Today, 32 of 50 shares rose, while 18 fell.

The broader indices almost mirrored their larger peers with gains of nearly 0.5%. Thirteen of the 19 sectoral indices compiled by BSE Ltd. advanced with S&P BSE Basic Materials and Oil & Gas rising over 1%.

The market breadth was skewed in the favour of bulls. About 2,104 stocks advanced, 1,305 declined and 84 remained unchanged.

"Nifty came off days high in mid-morning, however after witnessing minor sell off it reclaimed its positive stance and ended the session with gains of 67points (+0.4%) at 17,813 levels", Siddhartha Khemka, Head - Retail Research, Motilal Oswal Financial Services Ltd., wrote in a note and added that "while the market trend might be volatile in the near term on account of potential risk from Omicron variant, upcoming budget and fragile global cues, in the long run, strong earnings delivery along with positive macro-economic data would hold the key to drive markets".

• All international arrivals at airports, seaports and land borders will have to undergo home quarantine for 7 days and undertake a test on the 8th day of arrival.

• All travellers should upload a negative Covid-19 test taken a maximum of 72 hours before the journey.

Source: Health Ministry order

• Peninsula Land Ltd. has defaulted on a payment of Rs 77.2 crore of the total outstanding amount.

• The default is on a principal amount of Rs 67.6 crore and an interest amount of Rs 9.6 crore.

• The company’s total financial outstanding debt is Rs 730 crore.

Source: Exchange filing

• JPMorgan upgrades Hero Motocorp from 'neutral' to 'over weight'; price target: Rs 2,900

• M&M is JPMorgan's top pick in the sector. The brokerage remains 'overweight' on M&M; price target at Rs 1,150; an implied return of 37%.

• JPMorgan remains 'overweight' on TVS Motor; price target at Rs 735; implied return of 13%.

• JPMorgan remains 'underweight' on Maruti Suzuki; price target at Rs 6,750; implied return of -14%.

• M&M's auto business recovery over FY21-24E should fully offset teh sofitness in farm segment.

• Hero Motocorp's 35% stake in the electric vehicles start-up Ather Energy could be a source of value creation.

• Q3FY22 sectoral preview: JPMorgan expects strong sequential recovery but negative YoY growth for all OEMs except Ashok Leyland.

• Commodity costs are expected to adversely impact margins.

• Page Industries rises for the sixth day; on track for the longest winning streak in 13 months.

• Parag Milk Foods rises for the sixth day, on track for the longest winning streak in nearly 17 months.

Source: Bloomberg

• Indowind Energy Ltd. has decided to issue shares on the rights basis to existing shareholders for an amount not exceeding Rs 50 crore only.

• The company will intimate the record date, rights entitlement in due course of time.

Source: Exchange filing

Foundation stone for the 5 MTPA project at JSW Steel facity in Ballari, Karnataka was laid today by Union Steel Minister Ram Chandra Prasad Singh.

• The brown-field expansion project is being undertaken through JSW Steel's subsidiary JSW Vijayanagar Metallics.

• The company has plans for capex investment of Rs 15,000 crore for this expansion, which is expected to be completed by FY24.

• The project has already received Environmental Clearance from Ministry of Environment, Forests & Climate Change and preliminary clearance from Government of Karnataka.

Source: Exchange Filing

Tata Consultancy Services has been selected by Ministry of External affairs for the second phase of Passport Seva program.

• TCS will refresh existing facilities and systems as well as develop new solutions to enable issuance of e-passports.

• TCS to use biometrics, AI, advanced data analytics, natural language processing and cloud technologies.

• Of the 50 analysts tracking the company, 31 maintained 'buy', 11 maintained 'hold' and eight maintained 'sell' recommendations. The overall consensus price of analysts tracked by Bloomberg implied an upside of 8.1%.

Source: Exchange filing, Bloomberg

India's stock benchmarks advanced, but came off morning highs. The rise was aided by gains in energy, fmcg and banking stocks.

The S&P BSE Sensex rose 0.2% to 59,702.17. The 30-stock gauge rose nearly 1% in intraday trade to 60,130.18. The NSE Nifty 50 advanced by similar magnitude to 17,781.10. Grasim Industries Ltd. had the largest increase, rising 4.1%. In midday trading, 31 of 50 shares rose, while 17 fell.

The broader indices almost mirrored their larger peers with both S&P BSE MidCap and S&P BSE SmallCap rising over 0.3%. Thirteen of the 19 sectoral indices compiled by BSE Ltd. advanced with S&P BSE Oil & Gas adding 0.75%.

The market breadth was skewed in the favour of bulls. About 2,098 stocks advanced, 1,219 declined and 91 remained unchanged.

• Easy Trip Planners Ltd. will consider the proposal for issue of bonus shares on Jan. 12, the company said in an exchange filing.

Source: Exchange Filing

Shares of Ujjivan Small Finance Bank rose nearly 12%, the biggest intraday gain in three months after the company said that its gross loan book rose 15% sequentially, in its Q3 business update.

• Total deposits grew 10% QoQ to Rs 15,600 crore

• CASA ratio at 26% versus 22% in Q2

Of the 18 analysts tracking the company, six maintained 'buy', five maintained 'hold' and seven maintained 'sell' recommendations. The overall consensus price of analysts tracked by Bloomberg implied an upside of 6.9%.

Source: Exchange Filing, Bloomberg

Shares of Grasim Industries Ltd. rose over 3% to Rs 1,774.9 apiece after Motilal Oswal Financial Services upgraded the stock to 'buy' from 'neutral'.

• In a report dated Jan. 6, the brokerage raised the target price to Rs 2,050 from Rs 2,035; an implied upside of 19%.

• Motilal Oswal says the company should benefit from changes in cotton industry dynamics.

Source: Brokerage report, Bloomberg

India’s rupee advanced as traders expected further dollar inflows from the overseas bond fund raising by a large corporate. Government bonds gained ahead of a Rs 24,000 crore ($3.2b) weekly auction.

• USD/INR falls 0.3% to 74.3062 on Friday

• 10-year yields fall about 1bp to 6.52% on Friday

Source: Bloomberg

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

• The 2-year yield remained unchanged at 4.706%

• The 10-year yield was little changed at 6.522%

• The 14-year yield rose 0.5bps to 7.006%

• The 2-year-10-year yield spread was 181.6bps, vs previous close 181.9bps

Source: Bloomberg

Alembic Pharmaceuticals Ltd. received tentative approval from the U.S. FDAfor its Abbreviated New Drug Application (ANDA) for Vortioxetine Tablets 5 mg, 10 mg, 15 mg and 20 mg. Thedrug is indicated for the treatment of major depressive disorder (MDD).

• The tablets have an estimated market size of $1,249 million for twelve months ending September 2021, according to IQVIA.

• Alembic Pharmaceuticals is currently in litigation with H.Lundbeck and launch of the product will depend on litgation outcome.

Source: Exchange filing

Shares of Kalyan Jewellers India Ltd. rose over 4.2% to Rs 74.9 apiece after the company reported a consolidated revenue growth of 17% YoY for Q3, the company said in its quarterly update before market hours Friday.

• The company said that revenue growth for India operators was 15% YoY despite a strong base as Q3FY21 was the the first normalised quarter post the initial lockdowns due to covid-19.

• Further easing of covid-related curbs during the festive season aided business momentum.

• Encouraged by the sequential expansion in gross margin, as it is nearing the pre-covid levels.

• Studded share saw meaningful growth while Gold Savings Scheme enrolments rose sequentially.

• Online jewellery platform Candere recorded a revenue growth of over 35% YoY in Q3.

• Witnessed significant improvement in customer sentiment in Q3 in the Middle East region, which contributed 15% to the consolidated revenue.

Source: Exchange filing

Shares of Titan Co Ltd. rose 3.5%, the biggest intraday gain in a week, to Rs 2,687.25 apiece after the company witnessed strong demand across consumer business in Q3.

• Titan clocked 36% YoY revenue growth, according to Q3 business update.

• Company says that festive purchases contributed to 37% YoY revenue growth in jewellery business.

• Of the 31 analysts tracking the company, 20 maintained 'buy', six maintained 'hold' and five maintained 'sell' recommendations. The overall consensus price of analysts tracked by Bloomberg implied a downside of 2.7%.

Source: Exchange Filing, Bloomberg

• Reliance New Energy Solar Ltd. bought 18.4 million shares in Sterling & Wilson Renewable Energy Ltd. from Shapoorji Pallonji & Co. via an off-market purchase, Reliance Industries Ltd. said in an exchange filing.

• Shares were bought for Rs 375 each.

• Reliance New Energy Solar now holds 25.16% of Sterling & Wilson's equity.

Source: Exchange Filing.

Shares of Hinduja Global Solutions Ltd. fell 20% to Rs 2856.65 apiece amid concerns surrounding the dividend declaration.

• The company declared a third interim dividend of Rs 150 per share and issue of bonus share in 1:1 proportion, on Thursday.

• Hinduja Global also completed sale of its healthcare services business to subsidiaries of Betaine BV for an enterprise value of $1,200 million (nearly Rs 9,000 crore). The company has transferred all assets and contracts to Betaine BV, effective January 6.

• There may be concerns around the fund usage considering that the dividend declared is far lower than the funds raised from sale of healthcare services business

Source: Exchange Filing, Company Press Release, Bloomberg

India's stock benchmarks advanced, aided by gains in banking, consumer durables and energy stocks, amid a rebound in global markets.

The S&P BSE Sensex rose 0.42% to 59,850.25. The NSE Nifty 50 also advanced by similar magnitude to 17,827.75.

The broader indices almost mirrored their larger peers with both the S&P BSE MidCap and S&P BSE SmallCap adding nearly 0.5%. Barrying, S&P BSE Healthcare, all the other 18 sectoral indices compiled by BSE Ltd. advanced, with S&P BSE Oil & Gas, Consumer Durables, Bankex and Energy rising over 1%.

The market breadth was skewed in the favour of bulls. About 2,112 stocks advanced, 616 declined and 111 remained unchanged.

Bharti Airtel Ltd. has said it will not avail the option of conversion of the interest on deferred spectrum and AGR dues into equity.

In an exchange filing, the company informed that it confirmed the decision to the Department of Telecommunications.

Source: Exchange Filing

Lupin Ltd. announced the launch of Molnupiravir in India under the brand name Molnulup. The drug has received emergency use authorisation by India's drug regulator.

• Molnupiravir has been authorised to be used to treat adult patients with covid-19, with SpO2 > 93% and high risk of progression of the disease.

• The oral antiviral drug has already been approved by U.S. FDA and UK Medicines and Healthcare products Regulatory Agency.

Source: Exchange filing

Kalyan Jewellers Ltd. reported a consolidated revenue growth of 17% YoY for Q3, the company said in its quarterly update before market hours Friday.

The company said that revenue growth for India operators was 15% YoY despite a strong base as Q3FY21 was the the first normalised quarter post the initial lockdowns due to covid-19.

• Further easing of covid-related curbs during the festive season aided business momentum.

• Encouraged by the sequential expansion in gross margin, as it is nearing the pre-covid levels.

• Studded share saw meaningful growth while Gold Savings Scheme enrolments rose sequentially.

• Online jewellery platform Candere recorded a revenue growth of over 35% YoY in Q3.

• Witnessed significant improvement in customer sentiment in Q3 in the Middle East region, which contributed 15% to the consolidated revenue.

Source: Exchange filing

Electricity transmission companies will be in focus after Indian government approved spending Rs 12,000 crore ($1.6 billion) to expand its green energy corridor.

• In Focus: Power Grid Corp of India, Adani Transmission, Tata Power, Torrent Power, CESC Ltd., KEC International

The second phase of green energy corridor would lead to grid integration and power evacuation of 20 Giga Watt of renewable energy projects in seven states.

• KPR Mill: Edelweiss Professional Investor initiated coverage on the stock with a 'buy' recommendation; price target set at Rs 860.

• Grasim raised to 'buy' from 'neutral' at Motilal Oswal Securities; price target set at Rs 2,050.

Source: Bloomberg

Asian stocks and U.S. futures rose as markets rebounded from Thursday's selloff.

Shares climbed in Australia, South Korea and Japan. S&P 500 futures saw modest gains.

The Singapore-traded SGX Nifty, an early indicator of India's Nifty 50 Index's performance, rose 0.10% to 17,837, as of 8:10 a.m

Elsewhere, oil held near a seven-week high on supply constraints. Gold and Bitcoin were little changed.

Stocks To Watch

• Titan Company: The company witnessed strong demand across its consumer businesses in Q3 and clocked 36% growth over the festive quarter last year.

• Godrej Consumer Products: The company expects gross margins to fall YoY in Q3 due to unprecedented cost inflation, although it will still be higher than Q2. Consolidated sales growth in the quarter is expected to be close to high single-digit. In India, the company expects to deliver close to high single-digit sales growth, largely driven by pricing.

• Reliance Industries: Reliance Retail Ventures invested $200 million (about Rs 1,490 crore) in Dunzo for a 25.8% stake.

• Macrotech Developers: The company reported the highest pre-sales in last 12 quarters at Rs 2,608 crore. Collections were Rs 2,127 crore in Q3, up 44% on a YoY basis. It also raised Rs 4,000 crore through QIP during the quarter. Net debt for India business has reduced to Rs 9,925 crore.

• Adani Enterprises: NTPC has awarded contract to the company for supply of 1 MMT of imported coal to its various power plants.