Sensex, Nifty Log The Best Day In Two Weeks

India's stock benchmarks advanced for the second consecutive session and logged the biggest single day gains since December 8, aided by banking, auto, metals and realty stocks.

The S&P BSE Sensex rose 1.09% to 56,930.56. The 30-stock gauge reached within touching distance of 57,000 mark in intraday trade. The Nifty also advanced by similar magnitude to 16,955.45.

Hindalco Industries Ltd. had the largest increase, rising 4%. Today, 43 of the 50 shares rose, while seven fell.

The broader indices outperformed their larger peers with S&P BSE MidCap rising 1.5% and S&P BSE SmallCap gaining 1.7%. All the 19 sectoral indices compiled by the BSE Ltd. advanced with S&P BSE Realty adding nearly 3%. S&P BSE Capital Goods, S&P BSE Industrials and S&P BSE Energy also rose over 2% while S&P BSE Auto index closed with gains of almost 2%.

The market breadth was skewed in the favour of bulls. About 2,435 stocks advanced, 907 declined and 104 remained unchanged.

"The momentum is back in the Indian market, which is supported by strong gains in Asian peers. India is at the beginning of capex revival phase and therefore corporate earnings recovery looks sustainable and premium valuations might sustain", Mitul Shah, Head of Research at Reliance Securities wrote in a note and added "we believe that India is better placed compared to major global economies in terms of handling Covid and its spread, while revival of capex and higher growth potential over next 1-2 years would keep Indian economy expansion ahead of many other nations. This would lead to bounce back in Indices going into 2022".

"Low market volumes in the last few sessions have contributed to exaggerated market volatility. Despite a sharp correction in the last week, retail net long open interest in stock futures has come off by only 2%, pointing to continued confidence in staying invested", noted S Hariharan, Head - Sales Trading, Emkay Global Financial Services and added that "consumer-facing sectors like Banking & FMCG have broken critical moving averages pointing to a break in the medium-term uptrend. A consolidatory phase going into results season is expected as volumes would remain muted for the rest of December, since there are expected to be few triggers in terms of newsflow".

• Amazon will acquire Infosys co-founder NR Narayana Murthy-founded Catamaran’s stake in their joint venture Prione Business Services.

• Prione’s board and its unit Cloudtail will take steps to complete the transaction on getting regulatory approvals.

Source: Bloomberg

Shares of Hindalco Industries Ltd. rose over 4%, the biggest intraday gain in over two weeks, to Rs 463.65 apiece after ICICI Securities reiterated 'buy' recommendation on the stock citing the positive impact due to the acquisition of Hydro's aluminium extrusions business in India. ICICI Securities maintained the target price unchanged at Rs 550 apiece, an implied return of 23.47%.

The brokerage said in a note dated Dec. 21, that acquisition falls within the envelope of the company's 'doubling the downstream' strategy.

The place will also serve an archetype for Hindalco's upcoming extrusions plant in Silvassa. The Kuppam unit (the acquisiton of Hydro's aluminium extrusions business) and Silvassa units are expected to boost Hindalco's total aluminium extrusions capacity from 60 ktpa to 109 ktpa.

Shares of Rategain Travel Technologies rose over 10% in intraday trade for the second consecutive session to Rs 401.85 apiece.

• The stock got listed on the bourses on December 17 at a 15.29% discount to the issue price of Rs 425 apiece and fell 1.44% on Monday, amid the free fall in Indian markets.

• Over the past two sessions though, the stock has bounced baced, rising over 17.6%.

Shares of Yes Bank Ltd. rose 5%, the biggest single day gain in over a week, to Rs 13.65 apiece, after the lender approved the proposal to raise Rs 10,000 crore through the issue of new shares, debt or any other permissible mode.

In an exchange filing Tuesday, Yes Bank said it will an extension on the current shareholder approval which is set to expire on February 28, 2022.

Deepak Nitrite approves raising of funds upto Rs 2,000 crore via share share. Firm also approved proposal to seek shareholders' nod for planned QIP.

Shares of IDFC Ltd. rose 5.51%, the biggest intraday gain in nearly a month, to Rs 51.7 after the company approved the appointment of Anil Singhvi as the Chairman of board of directors of the company.

• Appointment is effective immediately

• In September, IDFC shareholders rejected reappointment of Vinod Rai as chairman.

The firm also approved the proposal to seek shareholders' nod for

• (i) the appointment of Anita Belani as an additional director in the category of independent director for a period of three years and

• (ii) a scheme of amalgamation of IDFC Alternatives Ltd., IDFC Trustee Company Ltd. and IDFC Projects Ltd. into IDFC Ltd.

Source: Exchange Filing

Shares of PNC Infratech Ltd. rose 4.66% to Rs 273.95 apiece after the company received LoA from NHAI for "collection of user fee at 135 km long Eastern peripheral expressway fee plazas in the states of Haryana and Uttar Pradesh for one year. The contract value of the project came in at Rs 369 crore.

Of the 23 analysts tracking the company, 22 maintained 'buy' and one maintained 'hold' recommendations. The overall consensus price of analysts tracked by Bloomberg implied an upside of 48.2%.

Source: Exchange Filing

Shares of ABB India Ltd. rose 6%, the biggest intraday gain in over a week since December 9, to Rs 2,332 apiece after the company approved the incorporation of a wholly owned subsidiary and the sale of company's turbocharger business as a going concern, on a slump sale to its wholly owned subsidiary for Rs 310 crore.

• The slump sale will be completed by the end of February, 2022.

• The turbocharger business has a turnover of Rs 187 crore, 3% of the total turnover of the company for the financial year ending December 31, 2020.

Of the 30 analysts tracking the company, 15 maintained 'buy', eight maintained 'hold' and seven maintained 'sell' recommendations. The overall consensus price of analysts tracked by Bloomberg implied a downside of 15.8%.

Shares of Larsen & Toubro Ltd. rose over 1.7% to Rs 1,859 apiece, after the company's construction arm, L&T Construction, bagged a 'significant' order for its buildings and factories business from a reputed developer.

• L&T classifies 'significant' orders as those in the value range Rs 1,000 crore to Rs 2,500 crore.

• The residential business of buildings and factories secured the order to construct one of the largest residential townships in Bengaluru. The project involves construction of 6,768 apartments spread across 39 towers with 2 basements, ground and 27 to 31 floors. The total built up area will be 13.43 million square feet. The project is scheduled to be completed in 42 months.

• Of the 43 analysts tracking the company, 41 maintained 'buy', one maintained 'hold' and one maintained 'sell' recommendations. The overall consensus price of analysts tracked by Bloomberg implied an upside of 18.9%.

Shares of Cadila Healthcare Ltd. rose 1.5% in intraday trade to Rs 461.85 apiece after the company received tentative approval from U.S. FDA for Pimavanserin tablets.

• The drug is used to treat the symptoms of a certain mental/mood disorder that might occur with Parkinson's disease. It helps lessen symptoms such as seeing or hearing hallucinations and delusions.

• The drug will be manufactured at the company's manufacturing facility at the SEZ, Ahmedabad.

Of the 35 analysts tracking the company, 17 maintained 'buy', nine maintained 'hold' and nine maintained 'sell' recommendations. The overall consensus price of analysts tracked by Bloomberg implied an upside of 20.3%.

India's stock benchmarks advanced, aided by gains in metals, capital goods, telecom, banking and information technology stocks.

The S&P BSE Sensex rose 0.74% to 56,736.12. The NSE Nifty 50 advanced by similar magnitude to 16,897.65. Tata Motors Ltd had the largest increase, rising 3.5%. In midday trading, 41 of the 50 shares rose, while nine fell.

The broader indices outperformed their larger peers with S&P BSE MidCap and S&P BSE SmallCap rising over 1.3%. All the 19 sectors compiled by BSE Ltd. rose, with S&P BSE Realty advancing nearly 3%.

The market breadth was skewed in the favour of bulls. About 2,450 stocks advanced, 782 declined and 125 remained unchanged.

Shares of One97 Communications Ltd., which runs the payments platform Paytm rose nearly 3% in intraday trade to Rs 1,350 apiece, after company got 'overweight' rating as Morgan Stanley initiated coverage on the stock. The target price has been set at Rs 1,875 per share, an implied return of 42.97%.

Morgan Stanley noted Paytm's strong customer acquisition trackrecord through payments and its rapid expansion into financial services at low incremental cost. The brokerage expected the profitability to improve sharply as financial services scaled up and anticipated the balance sheet risk to remain low.

Here's a gist of Morgan Stanley's assessment of Paytm's growth prospects

Morgan Stanley

• Initiates coverage on the stock with 'overweight' rating; target price at Rs 1,875, an implied return of 42.97%.

• Profitability will improve as the share of financial services/commerce ramps up.

• Company is likely to benefit from the strong acceleration of penetration in financial services market in India.

• Company's collaborative approach towards lending/distribution in financial services is synergistic and scalable.

• Values paytm at $17 billion using a EV/revenue methodology to arrive at the current price target.

• Expects revenues to rise at 40%+ CAGRs over the next five years.

• Expects the company to break even on Ebidta in FY25.

• Allowance of merchant discount rate under the UPI, introduction of healthy interchange on wallets and stronger than execution in financial services could act as positive catalysts.

Key Risks

• Higher than expected competitive intensity in payments and/or reduction in payment charges,

• Weak performance in financial services,

• Negative regulatory changes and

• a severe third wave of covid-19.

Of the seven analysts tracking the company, two maintained 'buy', two maintained 'hold' and three maintained 'sell' recommendations. The overall consensus price of analysts tracked by Bloomberg implied an upside of 19.8%

Bharat FIH Ltd. seeks to raise Rs 2,502 crore selling new shares in an IPO, while its founder will sell secondary shares of the same amount, according to initial prospectus.

• Company focuses on making mobile phones and has 15% market revenue share in financial year 2021.

• Company operates from three campuses in southern Indian states of Andhra Pradesh and Tamil Nadu

• Kotak Mahindra Capital, Citi, BNP Paribas and HSBC are the banks managing the IPO.

• Retail investors are well advised to board the secondary market; not saying that they should not enter the IPO.

• We are seeing more than 27 lakh new demat account per month as compared to 4.5 lakh

• We have taken out a consultation paper on longer lock-in for anchor investors. Will take a view soon on that.

• The monitoring mechanism for use of proceeds of IPOs is weak and we plan to address that through the outcome of the consultation paper.

• Fora highlight operational challenges in implementing guidelines.

• Fora seek phased implementation of the new mandate, a minimum time frame of six months for merchants to comply.

• Readiness of banks, card networks, and payment aggregators, payment gateways, as well as the generation of consumer awareness necessary.

• The RBI has prohibited merchants from storing customer card details on their servers with effect from January 01, 2022

Source: MPAI and ADIF statement

• Expect at least a dozen semiconductor manufacturers to start setting up local factories in the next 2-3 years.

• Government is working on developing an entire ecosystem for chip manufacturing industry.

• Government will start taking applications under the incentive schemes from Jan. 1, 2022.

• Strong response for government's incentives for the chip manufacturing industry.

• All the big players are in talks with Indian partners and many want to come directly to set up their units here.

• Expect compound semiconductor units, design and packaging companies to get approval within the next 3-4 months.

Source: Interview to Bloomberg TV

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

• The 5-year yield fell 0.5bps to 5.79%

• The 10-year yield was little changed at 6.471%

• The 20-year yield remained unchanged at 6.914%

• The 5-year-10-year yield spread was 68.1bps, vs previous close 67.4bps

• The NSE Nifty 50 Index rose 0.6%

Source: Bloomberg

Fintech platform Angel One Ltd. has partnered with Vakrangee Digital Ventures Ltd. to offer opening of demat account for Vakrangee's customers through their BharatEasy Super app and Nextgen Kendras.

Angel One will offer its products and services to customers across the country through this partnership, especially in tier 2, 3 and beyond cities.

Source: Exchange Filing

Shares of Aditya Birla Money Ltd. rose over 6.5%, the biggest intraday gain in nearly two weeks, to Rs 63.5 apiece, after the company announced it would offer 16 lakh preference shares at an issue price of Rs 500 per share, amounting to Rs 80 crore to Aditya Birla Capital Ltd., promoter and holding company.

Shares of Aditya Birla Capital rose 3% in intraday trade to Rs 116.4 apiece.

Source: Exchange Filing, Bloomberg

Shares of engineering and technology solutions firm Mindteck Ltd. rose 5% in intraday to Rs 175 apiece after the company bagged a new project from an analytical instrument client. Trading volume on the stock was 1.8 times the 30-day average volume, for this time of the day.

In an exchange filing, the company said that the Europe-based client provides precision instrumentation monitoring solutions to reduce occupational and environmental health risks.

The scope of the new project encompasses tech upgrades to the data management software, database migration, feature enhancements and third-party tool integration.

Source: Exchange Filing, Bloomberg

Shares of Macrotech Developers Ltd. rose 3.78% in intraday trade to Rs 1,179.75 apiece after India Ratings & Research reaffirmed the company's credit rating and revised the outlook to 'positive' from 'stable'.

The revised ratings for bank loans, NCDs and fund-based limits are IND BBB+/Positive from IND BBB+/Stable previously.

The rating for non-fund based limits remained unchanged as IND A2.

Of the 11 analysts tracking the company, nine maintained 'buy' and two maintained 'sell' recommendations. The overall consensus price of analysts tracked by Bloomberg implied an upside of 11.5%.

Shares of India Cements Ltd. rose nearly 9%, the biggest intraday gain in over two months, to Rs 192.4 apiece after billionaire investor Radhakishan Damani and his family, raised their stake to 22.76% between November 22 and December 20, 2021, after picking up over 62 lakh shares through open market purchases.

According to the shareholding pattern of the company on the NSE, Radhakishan S Damani held 11.34% stake, Gopikishan Damani held 8.46 and the duo together held 1.34%, adding up to 21.13%, as on September 30.

Of the 12 analysts tracking the company, one maintained 'buy', four maintained 'hold' and seven maintained 'sell' recommendations.

India's stock benchmarks advanced, aided by gains in metal, banking, oil an gas and realty stocks, amid a rebound in global equities.

The S&P BSE Sensex rose 0.77% to 56,751.88. The NSE Nifty 50 advanced by similar magnitude to 16,907.40.

The broader indices almost mirrored their larger peers with S&P BSE MidCap adding 0.7% and S&P BSE SmallCap gaining 1%. All the 19 sectoral indices compiled by BSE Ltd. advanced, with S&P BSE Metal, Auto and Energy indices leading the gains.

The market breadth was skewed in the favour of bulls. About 1,930 stocks advanced, 433 declined and 64 remained unchanged.

Sovereign wealth funds including Singapore's GIC Pte, Abu Dhabi Investment Authority and UAE's Mubadala Investment Co are exploring investments in Reliance Industries Ltd.'s clean energy unit, Mint newspaper reported, citing two people aware of the development.

An Abu Dhabi Investment Authority spokesperson declined to comment on the matter to the newspaper, while Reliance, GIC and Mubadala did not respond to requests seeking comment.

Bond traders are awaiting the release of RBI minutes for clues about the impact of omicron variant on the future policy. Traders will eye cutoffs at a treasury bill auction after shorter-maturity bonds fell following the RBI's reverse repo operations on Monday.

• Bond yields have risen since the RBI spooked markets by a shorter 3-day reverse repo pushing up shorter-term rates.

• Benchmark 10-year yields climbed 4bps to 6.47% on Tuesday.

• USD/INR fell 0.4% on Tuesday to 75.6025.

• Overseas investors sold Rs 1,210 crore of Indian stocks on Tuesday, according to provisional NSE data; they sold Rs 26 crore of sovereign bonds under limits available to foreign investors, and added Rs 81 crore of corporate debt.

• State-run banks bought Rs 1,400 crore of sovereign bonds on December 21: CCIL data. Foreign banks bought Rs 1,320 crore of bonds.

Source: Bloomberg

• Vascon Engineers Ltd. received Letter of Award amounting to Rs 199 crore from Vedanta Ltd. for construction of Cairn Oil & Gas Residential Complex at Barmer, Rajasthan.

• The work has to be completed within 18 months and has been awarded on 'design and build basis'.

Source: Exchange Filing

• FSN E-Commerce Ventures Ltd.: JM Financial Institutional Securities Pvt Ltd. initiates coverage of the company with a recommendation of 'buy'; price target set at Rs 2,480.

• Motherson Sumi Systems Ltd.: Raised to 'buy' from 'add' at Kotak Securities; price target at Rs 255.

Source: Bloomberg

• Paytm: Morgan Stanley initiated coverage on One97 Communications Ltd. with 'overweight'; price target set at Rs 1,875 apiece.

• Paytm: Goldman Sachs initiated coverage on One97 Communications Ltd. with a 'neutral'; price target set at Rs 1,630 apiece.

Source: Bloomberg