Sensex, Nifty End Higher For Second Session Despite Volatile Start

India’s equity benchmarks shrugged off a volatile start to close higher for the second consecutive session, aided by gains in oil & gas, energy, power, telecom and information technology stocks.

The S&P BSE Sensex Index added 0.75% to 59,744.88 while the NSE Nifty 50 Index advanced by similar magnitude to 17,822.30, highest closing level since September 27. Reliance Industries Ltd. contributed the most to the index gain, increasing 2.1%. Oil & Natural Gas Corp. had the largest increase, rising 10.9%. Today, 30 of 50 shares rose, while 20 fell.

The broader indices underperformed their larger peers with the S&P BSE MidCap rising 0.3% and S&P BSE SmallCap gaining over 0.5%. Fifteen of the 19 sectoral indexes compiled by BSE Ltd. advanced, with the S&P BSE Oil & Gas index rising over 3.2%. The S&P BSE Energy and Telecom indexes also added over 2%.

The market breadth was skewed in favour of bulls. About 2,081 stocks advanced, 1,202 declined and 166 remained unchanged.

“Heavyweight Reliance Industries continued to move higher and supported market rally. However, pharma and FMCG stocks were laggards. Further, buying momentum remained visible in midcap and smallcap stocks, while value stocks continued to outperform growth stocks”, Binod Modi, Head Strategy at Reliance Securities, wrote in a note, before adding that “festive demand, recovery in rural demand, COVID-19 positivity rates, vaccination ramp-up, September quarter earnings and RBI policy meeting outcome will be in focus in the near term”.

GAIL India Ltd. unloaded a LNG cargo at Dabhol on the country’s west coast over the weekend to restart the import terminal that’s been shut since May because of the monsoon, E.S. Ranganathan, director for marketing at the state-run gas utility, said in an interview.

The company will bring in another shipment at Dabhol this week GAIL has also booked regasification slots at Shell’s Hazira LNG import terminal in Gujarat state for processing 1 LNG cargo each in October and November.

Source: Bloomberg

Glenmark Pharmaceuticals Ltd. has clarified that its U.S. entity, Glenmark Pharmaceuticals Inc. USA, has voluntarily recalled products such as Fulvestrant injection, Naproxen Sodium tablets, Chlorzoxazone tablets, Zonisamide capsules and Arformoterol Tartarate inhalation solution, as a matter of abundant caution.

Glenmark Pharma’s clarification comes after the exchanges sought information on media report on the recall. Glenmark also added that it will take all necessary action to ensure quality of products and operational compliance.

Shares of Datamatics Global Services Ltd. rose over 7% in intraday trade, the most in over a month, to Rs 326 apiece after the company introduced Enterprise Productivity Plan to help transform companies digitally and enhance productivity.

In an exchange filing, Datamatics said that enterprises can use Datamatics Intelligent Automation Platform starting at $99 per month. Under the plan, Datamatics will offer

• One TruBot (unattended or attended) RPA bot license

• TruCap+IDP license for usage up to 10,000 pages for a period of 90 days.

• Two hours of consulting with an intelligent automatic expert.

Trading volume on the stocks was 2 times the 30-day average volume, for this time of the day.

Jindal Stainless Ltd. is higher for the fifth straight day, extending the longest winning streak since the period ended July 13, 2020.

Shares of Jindal Stainless has gained a total of 14% during the streak while the S&P BSE Sensex Index fell 0.2%.

All the six analysts tracking the company maintained 'buy' recommendation. The overall consensus price of analysts tracked by Bloomberg implied an upside of 16%.

Shares of BLS International Services Ltd. rose 4.49% in intraday trade to Rs 278 apiece after the company renewed its contract with Royal Thai Embassy in New Delhi for visa services. In an exchange filing, BLS International said that it will accept visa applications for Thailand from various cities of India. It will also provide several value-added services like form filing assistance, premium lounge, travel insurance, tourism desk and courier services.

• Bharti Airtel conducts India rural 5G trials with Ericsson.

• Expect 5G auctions in India early year year.

- Randeep Sekhon, CTO, Bharti Airtel

Source: Bloomberg

Shares of IRCON International Ltd. rose nearly 6% in intraday trade, the most in five weeks, to Rs 47.75 apiece after the company along with its JV partner emerged as the lowest bidder valuing Rs 3,249 crore in the tender floated by National High Speed Rail Corporation Ltd.

In an exchange filing, IRCON International said that the contract pertained to the construction of 18.133 km of viaduct involving Ahmedabad Station and Sabarmati Station and related works for the construction of Mumbai-Ahmedabad High Speed Rail. The completion period of the project if approximately 4.5 years.

Trading volume on the stock was 3.9 times the 30-day average volume for this time of the day.

Shares of Asia Pacific oil producers and refiners advanced as crude prices continued to jump, on the back of OPEC+ agreeing to maintain gradual production increases.

• Brent futures +0.5% to $81.68/barrel as of 3:28 p.m. Hong Kong Time, near 2018 high

• India: Oil & Natural Gas surges as much as 10% to highest since July 2019; Indian Oil climbs 3.4%

• Australia: Oil Search closes up 2.3%, Woodside Petroleum 4%, Santos 2.5%

• Japan: Inpex up 5.6% to highest since Feb. 2020; Japan Petroleum Exploration +5.5%, Idemitsu Kosan +3.7%

• Hong Kong: PetroChina gains 6.8%, CNOOC 2.5%, China Petroleum & Chemical 2.4%

• Southeast Asia: Philippines’ Petron rises 8%; Thailand’s Bangchak +2.7%, PTT Exploration & Production +1.7%

Source: Bloomberg

IDFC First bank Ltd. said that the total customer deposits in the quarter-ended September 30,2021 decline 1.3% QoQ. In an exchange filing, IDFC First Bank shared provisional figures for Q2.

September Quarter Numbers (Provisional)

• Gross Funded Assets at Rs 1,17,243 crore vs Rs 1,13,794 crore QoQ

• Total Customer Deposits at Rs 83,793 crore vs Rs 84,893 crore QoQ

• CASA Deposits at Rs 46,783 crore vs Rs 46,439 crore QoQ

• CASA Ratio at 51.90% vs 81.56% QoQ

Shares of IDFC First Bank rose nearly 2% in intraday trade to Rs 48.55 apiece. Of the 11 analysts tracking the company, three maintained ‘buy’, two maintained ‘hold’ and six maintained ‘sell’ recommendations. The overall consensus price of analysts tracked by Bloomberg implied an upside of 8.8%.

Aurionpro Solutions Ltd. has announced that its subsidiary Integro Technologies Pte Ltd., based in Singpore has won multiple deals for product upgrades and enhancements. In an exchange filing, Aurionpro added that Integro has successfully implemented its Smart Lender Product Suite at some of the largest banks in the region, and the recent deals also included orders from leading banks. The aggregate value of the new orders was approximately Rs 12 crore and the orders would be implemented over next few months.

India’s central bank sets cutoff rate for 7-day reverse repo at 3.61%, lower than market estimates.

• The cutoff rate was expected at 3.75% in a Bloomberg poll of five traders

• RBI drains Rs 2 lakh crore as planned; weighted avg. rate is 3.55%

• RBI had shocked markets last week by setting a cutoff rate of 3.99%, 57bps up from the pvs auction and a shade below the policy rate of 4%

• Yield on 5-year bond up 2bps to 5.71%

Source: Bloomberg

Shares of Allied Digital Services Ltd. rose 7.7% to Rs 81.1 apiece after the company secured a five-year contract worth Rs 165 crore from a large global manufacturing conglomerate. In an exchange filing, Allied Digital said that the order pertained to the management and transformation of the I.T. infrastructure services including workplace services, enterprise services, enterprise applications, security and governance support.

The relative strength index on the stock was 72, suggesting that it may be overbought.

India's stock benchmarks were little-changed, as gains in oil & gas, power and telecom stocks were offset by losses in banking, healthcare, realty and information technology stocks.

The S&P BSE Sensex traded flat at 59,265.15. The NSE Nifty 50 was also little changed at 17,693.20. Oil & Natural Gas Corp. contributed the most to the index gain and had the largest move, increasing 8.1%. In midday trading, 24 of 50 shares rose, while 26 fell.

The broader indices outperformed their larger peers with the S&P BSE MidCap rising 0.3% and S&P BSE SmallCap adding 0.6%. Thirteen of the 19 sectoral indices compiled by the BSE Ltd. advanced, with S&P BSE Power and Oil & Gas indexes rising nearly 2.5%.

The market breadth was skewed in favour of bulls. About 2,003 stocks advanced, 1,145 declined and 173 remained unchanged.

• All the good news we anticipate in the coming few months is priced in.

• Market will correct as much as 15% if quarterly earnings fail to match expectations.

-Praveen Jagwani, CEO, UTI International Singapore Pte Ltd. to Bloomberg TV

• Licious raises $52 million led by IIFL AMC’s late stage tech fund.

• The fresh round values Licious at $1 billion.

• Licious becomes India’s first fresh meat and seafood delivery unicorn.

Source: Company Statement

TVS Motor Company Ltd. signed an MoU and entered into a strategic partnership with Tata Power Company Ltd. The two companies will implement electric vehicle charging infrastructure, across India and deploy solar power technology at TVS Motor locations, as part of the MoU.

The partnership aimed to create dedicated electric two-wheeler charging infrastructure in India, TVS Motor said in an exchange filing. Customers of TVS iQube Electric would also get access to widespread charging network by Tata Power through the TVS Motor customer connect app and Tata Power EZ Charge app across India. TVS Motor said that it will expand e-scooter to 25 cities in next few months.

Aurobindo Pharma Ltd. has confirmed the recall of 2,820 bottles of Metoprolol Tartrate tables in the U.S. market. In a reply to a clarification sought by the exchanges on a news report related to the recall, Aurobindo Pharma added the recall was done at the pharmacy level.

Metoprolol Tartrate tablets are used to treat angina (chest pain) and hypertension (high blood pressure).

Larsen& Toubro Infotech Ltd. earned the Kubernetes on Microsoft Azure advanced specialization, a validation of a solution partner’s deep knowledge and proven expertise.

Shares of Paras Defence & Space Technologies Ltd. hit 5% upper circuit to Rs 542.9 apiece after ICRA Ltd. assigned “A-“ (A-Minus) rating to the cash credit facility on long term scale, obtained from Kotak Mahindra Bank Ltd. In an exchange filing, Paras Defence also added ICRA’s rating on the outlook was stable.

Yields rose across the India sovereign yield curve in Tuesday morning trading.

• The 4-year yield rose 1.2bps to 5.323%

• The 10-year yield rose 2.4bps to 6.272%

• The 14-year yield rose 2.1bps to 6.785%

• The 4-year-10-year yield spread was 94.9bps, vs previous close 93.7bps

• Shares of Aarti Industries Ltd. rose 4.47 to Rs 1,067 apiece.

• Trading volume was six-times the 20-day average for this time of the day.

• The relative strength index on the stock was above 70, indicating it may be overbought.

• Aarti Industries trades at 48 times its estimated earnings per share for the coming year. Analysts have 12 ‘buy’, five ‘hold’ and five ‘sell’ recommendations on the stock.

Shares of Nucleus Software Exports Ltd. rose over 2% in intraday trade to Rs 595 apiece after the company’s flagship lending product, FinnOne in Spain. FinnOne has been supporting Opel Vauxhall Finance in Europe since 2006 with Spain becoming the ninth and the latest European country to go live with FinnOne. OPEL is an automotive finance captive organization, supported by Stellantis and BNP Paribas.

Cadila Healthcare Ltd. has confirmed that it received permission to conduct Phase III trials for two-dose Covid vaccine. Issuing a clarification to the exchange over a media report titled ‘Zydus Cadila gets permission to control Phase III trial for two-dose Covid vaccine’, the company said that it had planned to intimate the exchanges after it completed phase III trials and applied for authorization from the government.

Shares of EID Parry India Ltd. rose nearly 2% to Rs 444 apiece after the company approved an investment of Rs 19 crore in share capital of the joint venture company, Algavista Greentech Pvt. Ltd. Algavista is a 50:50 JV with Synthite Industries Pvt Ltd. and is engaged in the manufacturing and marketing of Phycocyanin.

In an exchange filing, EID Parry announced the approval or the sale of the Plant & Equipment factory at Pettavaithalai. The plant is currently not in operation.

IHS Markit releases India’s September composite purchasing managers’ index.

• Index falls to 55.3 from 55.4 in Aug.; Year ago 54.6

  • Second consecutive month of expansion

• New orders fall to 55.3 vs 55.5 in Aug.

  • Second consecutive month of expansion

• Employment rises vs prior month

  • Highest reading since Feb. 2020

Source: IHS Markit

IHS Markit releases India’s September services purchasing managers’ index.

• Index falls to 55.2 from 56.7 in Aug.; Year ago 49.8

  • Second consecutive month of expansion

• Employment rises to 50.4 vs 49.5 in Aug.

  • Highest reading since Nov. 2020

  • Reverses contraction trend

• Business expectations fall vs prior month

  • Lowest reading since July 2021

Source: IHS Markit

The Indian rupee declined to its lowest level since July amid a spike in global crude prices, threatening to weigh on the finances of a net-oil importing nation.

• USD/INR rose 0.3% to 74.5550 after climbing to 74.6387, the highest since July 20

• Yield on 10-year bonds rose 3bps to 6.28%, the highest since April 2020

• The spike in the pair is due to the sudden jump in global crude prices and a drop in Asian equities, says Imran Kazi, vice president at Mecklai Financial

  • Rising crude has again fueled fears about India’s trade deficit which rose to a record high last month

  • An increase in oil prices could also fuel inflationary expectations eventually forcing the RBI to reverse its accommodative stance

Shares of HFCL Ltd. hit 5% upper circuit to Rs 79.6 apiece after the company secured an order worth Rs 287.96 crore from RailTel Corporation of India Ltd. In an exchange filing, HFCL said that the order pertained to the setting up of secured optical packet switched network for defense forces.

The hardware and software provided would be under warranty or a period of 24 months. The contract is to be executed within 12 months.

Jindal Steel & Power Ltd. reported that steel sales have breached 2 million tonnes for the first ever ever in Q2FY22. Sales volume surged 32% QoQ and 10% YoY to hit a record 2.13 million tonnes, the company said in an exchange filing.

Exports continued to aid sales with the share of exports rising over 40% in the quarter ended September 30, 2021. Steel production also rose to 1.93 million tonnes, a modest growth of 5% YoY.

One of the company's Australian coking coal mines is operational and the first shipment is expected in November. "It will reduce our coking coal dependency significantly", Managing Director VR Sharma said in a statement.

Of the 26 analysts tracking the company, 23 maintained ‘buy’, two maintained ‘hold’ and one maintained ‘sell’ recommendations. The overall consensus price of analysts tracked by Bloomberg implied an upside of 33.4%

Shares of Adani Green Energy Ltd. rose 4.24% in intraday trade, the most in three weeks, to Rs 1,226 apiece after the company’s founder Gautam Adani announced a fresh $20 billion investment in its green value chain over the next decade.

Speaking at a virtual event, Gautam Adani picked out electrolyzer manufacturing, backward integration plans for secure supply chain for renewables and AI-based industrial cloud platforms as areas that require funding.

Shares of SREI Infrastructure Finance Ltd. shed 4.65% to Rs 8.2 apiece after the Reserve Bank of India superseded the board of directors of SREI Infra and SREI Equipment Finance Ltd.

The regulator replaced the board with an administrator. Rajneesh Sharma, former chief general manager from Bank of Baroda has been appointed the administrator for both the companies.

Shares of Oil & Natural Gas Corp Ltd. rose nearly 6% in intraday trade, the most in seven months, to Rs 156.15 apiece. Trading volume was triple the 20-day average for this time of the day. The relative strength index on the stock was above 70, indicating it may be overbought.

ONGC trades at 7.2 times its estimated earnings per share for the coming year. Analysts have 24 'buy', three 'hold' and three 'sell' recommendations on the stock.

The recent 62% natural gas price hike by the government is expected to boost the profitability of upstream companies and support their investment spending . In a note, Fitch Ratings said that while the standalone credit profiles of companies like ONGC and Oil India would remain unchanged as the price hike was largely in-line with expectations, but the sustained high gas prices would improve ONGC's net leverage, capacity to support capex,

Shares of Rail Vikas Nigam Ltd rose 5.30% in intraday trade, the most in nearly two weeks, to Rs 31.8 apiece after the company entered into an MoU with Tata Steel Ltd. In an exchange filing, the company said that the MoU pertained to the implementation of infrastructure projects either on nomination basis as a deposit work or through the SPV route.

All three analysts tracking the company maintained ‘buy’ recommendations. The overall consensus price of analysts tracked by Bloomberg implied an upside of 26.8%

India's stock benchmarks opened lower, dragged by losses in banking and information technology stocks, amid weak global cues due to concerns over surging price for raw materials. OPEC+’s decision to maintain gradual supply hike pushed crude oil prices near the highest since 2014.

The S&P BSE Sensex shed 0.2% to 59,187.55. The NSE Nifty 50 also declined by similar magnitude to 17,663.75. Infosys Ltd. contributed the most to the index decline, decreasing 0.6%. Cipla Ltd. had the largest drop, falling 1.7%. In early trading, 24 of 50 shares fell, while 26 rose.

The broader indices outperformed their larger peers with the S&P BSE MidCap adding 0.2% and S&P BSE SmallCap gaining nearly 0.5%. Eleven of the 19 sectoral indices compiled by the BSE Ltd. advanced, with S&P BSE Power and S&P BSE Oil & Gas indexes gaining over 1%.

The market breadth was skewed in favour of bulls. About 1,542 stocks advanced, 704 declined and 109 remained unchanged.

Sona BLW Precision Forgings Ltd, through its wholly owned subsidiary Sona Comstar eDrive Pvt Ltd., entered into a collaboration agreement with IRP Nexus Group Ltd, Israel. The collaboration pertained to the supply and manufacture of magnet-less Drive Motor and the Matching Controller for performance two-wheelers and three-wheelers for global market, the company said in an exchange filing.

As per the deal, IRP will license its technology to Sona Comstar to manufacture exclusively in India. The magnet-plus-controller combination would not use rare-earth elements, and offer high efficiency and low cost to manufacturers.

Stocks of electricity producers in India may react after comments from the country’s power minister that coal shortage situation is beyond normal.

• In Focus: NPTC, Tata Power, Adani Power, Power Grid Corp of India, KEC International, Indian Energy Exchange

• S&P BSE India Power Index has risen for the past 6 days, extending its gains to ~58% this year vs benchmark Sensex’s 24% rise

• The sharp surge in energy demand has triggered an unprecedented fuel shortage at coal-fired stations in India and the situation is way beyond the the normal post-monsoon supply crunch companies face, newspaper Indian Express cited Power Minister R. K. Singh as saying.

Indian bond traders will look forward to the central bank’s liquidity-management operation Tuesday. The rupee may fall against the dollar as oil prices climb to a seven-year high.

• 10-year yields little changed at 6.25% on Monday

• USD/INR rose 0.3% to 74.3138

• Reserve Bank of India will hold a Rs 2 lakh crore 7-day reverse repo operation, and traders will closely watch the cutoff after the previous operation resulted in a higher-than-expected yield cutoff

• Global funds buy net Rs 861 crore of India stocks Monday: NSE

  • They bought Rs 12 crore of sovereign bonds under limits available to foreign investors, and withdrew Rs 1,480 crore of corporate debt

  • State-run banks bought Rs 6,050 crore of sovereign bonds on Oct. 1: CCIL data. Foreign banks sold Rs 969 crore of bonds

Source: Bloomberg

Shares of India’s telecom companies may react after a news report that India is considering a plan to settle legal cases with sector firms outside court to help the industry cut litigation burden.

• In Focus: Bharti Airtel, Vodafone Idea, Reliance Industries, Tata Teleservices Maharashtra

Sterling Investment Corp., a company owned by Shapoorji Pallonji Group’s promoters, plans to raise Rs 6,600 crore ($888m) by selling debentures that will be secured against shares of Tata Sons, the Economic Times reported citing documents filed with the Registrar of Companies.

• Sterling Investment owns 9.185% in Tata Sons, the holding company of the Tata Group

• Tata Sons in past objected to the Mistrys pledging their stake in India’s largest conglomerate: report

  • Mistrys own an 18% stake in Tata Sons

• Mistrys intend to use proceeds to make advance payments of bank loans of group firms and for working capital needs

  • The group has overall debt of ~ Rs 20,000 crore, it has been selling assets to repay bank loans

• Shapoorji Pallonji and Tata Sons did not respond to emailed requests for comments: ET

Makers of vaccines and other coronavirus treatments followed their global peers lower for a second day after Merck & Co. said its experimental Covid-19 antiviral pill cuts the risk of hospitalization and death in half.

In Focus: Dr Reddy’s, Cipla, Cadila Healthcare and Pfizer Ltd., a unit of Pfizer Inc. API suppliers to big pharma such as Divi’s Labs and Laurus Labs.

SpiceJet Ltd. Chairman Ajay Singh wants to expand the company’s fleet of passenger jets and cargo haulers as the Indian airline’s financial performance recovers after a punishing stretch during the pandemic.

Singh said SpiceJet has a “reasonable chance” of reaching break-even this quarter through December thanks to a combination of cost cuts, renegotiated aircraft leases, an uptick in air travel traffic in India and the growth of the company’s new cargo operation.

“We are easily the largest player in that space in our part of the world,” he said in an interview at an annual International Air Transport Association meeting in Boston. “We, like other airlines, made losses in this period but on the other side we built out this asset.”

Source: Bloomberg