Sensex, Nifty Snap Four-Day Losing Streak Aided By I.T., Pharma Stocks

India's stock benchmarks snapped a four-day losing streak, aided by gains in information technology, healthcare and realty stocks, as markets rebounded in the second half of Tuesday's session.

The S&P BSE Sensex rose 1.10% (equivalent of 581.34 points) to 53,424.09. The NSE Nifty 50 also advanced by similar magnitude to 16,013.45.

The move was the biggest since rising 2.5% on Feb. 25 and follows the previous session's decrease of 2.4%. Indian Oil Corp. had the largest increase, rising 4.3%. Today, 37 of 50 shares rose, while 12 fell.

The broader indices outperformed their larger peers with S&P BSE MidCap adding nearly 1.5% and S&P BSE SmallCap rising 1.33%. Fifteen of the 19 sectoral indices compiled by BSE Ltd. advanced with S&P BSE Realty, Information Technology, Teck and Healthcare indices leading the gains. On the flipside the S&P BSE Metal index shed nearly 2%.

The market breadth was skewed in the favour of bulls. About 2,241 stocks advanced, 1,093 declined and 93 remained unchanged.

"Market may remain volatile due to the Russia-Ukraine crisis. Trend in global equities, the movement of rupee against the dollar and crude oil prices will dictate trend in the near term", Mitul Shah, Head of Research at Reliance Securities wrote in a note. He added, "the Indian economy is in good shape given the underlying stellar corporate earnings momentum, the cleansed balance sheets, improving asset quality of the banks, levers in place for capex cycle revival and credit off-take, probable manufacturing resurgence given PLI and other government reforms. However, over near term war issue would have high negative bearings on global equity markets including Indian equities".

• $5 billion sell/buy auction in Dollar/Rupee.

• Bids worth $13.56 billion received.

• Cut off premium set at 656 paisa.

Source: RBI

India’s current account deficit could surpass 3% of GDP for the first time in a decade if oil price averages $130 a barrel in 2022-23, according to a report by Aditi Nayar, an economist with ICRA Ltd., the local unit of Moody’s Investors Service.

• The current account deficit is likely to widen by around $14 billion to $15 billion, or about 0.4% of GDP, for every US $10/bbl rise in the average price of the Indian crude basket, according to the report

• While the rupee may weaken amid high commodities prices and global market pessimism, India’s forex reserves will help avoid a “sudden sharp depreciation,” they wrote

• ICRA expects the rupee to trade in a range of 76-79 to the dollar until the conflict subsides.

Source: Bloomberg

Infosys and Dow Jones, the business information provider and publisher of The Wall Street Journal expand collaboration to focus on product enhancements.

• Infosys will work with Dow Jones to build and deliver an enhanced set of capabilities using analytics and machine learning tools.

• Shares of Infosys rose nearly 3.5%, the most in three weeks. Trading volume on the stock was nearly twice the 30-day average volume for this time of the day.

Source: Exchange Filing, Bloomberg

Shares of Power Grid Corp. of India Ltd. rose 5% to a record Rs 223.4 apiece.

• Trading volume on the stock was twice the 30-day average volume for this time of the day.

• Investec reiterated its 'buy' recommendation on the stock on Tuesday with the target price kept unchanged at Rs 220, an implied return of 3.77%,

• Of the 27 analysts tracking the company, 23 maintain 'buy' and four suggest 'hold' recommendations.

Source: Bloomberg

BLOOMBERG EXCLUSIVE

• Coal India will add production of 7 lakh tonnes of ammonium nitrate, a key ingredient used in explosives for mining.

• The move is intended to tackle surging costs and protect profit margins.

Source: People familiar with the matter.

• The London Metal Exchange has halted nickel trading after the metal’s price spiked to above $100,000 per ton briefly.

• The price of nickel skyrocketed 111% to a record high on a short squeeze, according to Bloomberg.

Source: Bloomberg

Adani Ports and Special Economic Zone Ltd. signed an agreement with Indian Oil Corp Ltd. towards augmentation of IOCL's crude oil volumes at Mundra port.

• IOCL will expand its existing crude oil tank farm at Adani Ports' Mundra port.

• This will help IOCL to handle and blend additional 10 mmtpa crude oil at Mundra and support its expansion at Panipat refinery in Haryani.

• IOCL accounts for nearly half of India's petroleum products' market share and has a refining capacity of 80.55 mmtpa.

Source: Exchange Filing

Higher oil prices are likely to hurt India stocks and relatively increase the appeal of China and Australia, Credit Suisse strategists write in a note, tactically downgrading the South Asian nation and raising the weighting of the other two countries in its Asia model allocation.

• Cuts India to underweight from overweight; upgrades China and Australia to overweight from market weight

• “China’s credit intensity still clouds long-term prospects, but we like the country’s low import bill, insulation from Fed rate hikes, improving macro indicators and wealth of potential policy tools,” strategists Dan Fineman and Kin Nang Chik write

• Adds to Malaysia overweight call and trims bullish weighting in South Korea, Thailand and Singapore

Source: Bloomberg

• Shipping Corporation of India's proposed privatization may need to wait until the market turbulence due to Russia's invasion of Ukraine abated.

• Globally markets are facing impact of the crisis. This is not the right opportune moment for privatization.

• The performance of the market will 'majorly' drive the timing of the divestment.

• War hasn't affected Shipping Corp.'s operations as Indian refiners buy very little crude from Russia

• Shipping Corp. is simultaneously demerging its non-core assets as part of divestment process.

• Deadline for financial bids for privatizing Shipping Corp. was extended from Jan. 18 as bidders sought more detailed due diligence due to mammoth size of the firm.

Harjeet Kaur Joshi, Chairperson & Managing Director, Shipping Corp.

Source: Interview to Bloomberg Television

Shriram City Union Finance Ltd. has declared a second interim dividend of Rs 27 per equity share of Rs 10 each for the financial year 2021-22.

• The record date to ascertain the eligibility for the payment of second interim dividend is March 17, 2022.

• The dividend will be despatched before March 25.

• This dividend follows an interim dividend of Rs 10 per share for FY2021-22 paid to shareholders on Nov. 24, 2021.

• Of the 14 analysts tracking the company, 11 maintain 'buy', two suggest 'hold' and one recommends 'sell'. The overall consensus price of analysts tracked by Bloomberg implies an upside of 61.4%.

Source: Exchange Filing

India’s government will take a call on whether to regulate or ban crypto assets after ongoing consultations are completed, Finance Minister Nirmala Sitharaman said Tuesday. 

• “After the consultation process gets duly completed, the ministry will mull over it, which is required because we need the executive to be sure that we are not crossing any legal requirements,” she said at India Global Forum

• “Many Indians have seen a future in it, therefore I see a possibility for revenue in it,” the minister said referring to a tax on earnings from crypto announced in the budget

• India had lot of consultations with the Reserve Bank on a central bank digital currency and sees “clear advantages” in it, she said.

Source: Bloomberg

India’s financial institutions should support the nation’s aim of achieving self-reliance and enhancing exports, Prime Minister Narendra Modi said Tuesday in a webinar on financing growth.

• The government has started working on the target of achieving net zero by 2070

• There is a need to expedite environment-friendly projects

• Modi says green financing, study and implementation of environment-friendly projects are the need of the day

• Financial institutions should focus on supporting areas related to global warming

• Central bank’s digital currency reflects government’s vision on boosting digital growth, Modi said

Source: Bloomberg

BLOOMBERG EXCLUSIVE

• Wadhwani, who joined RIL in 2011 from Rothschild, left the firm at the end of the last year.

• Navin Wadhwani is taking a break and attending courses on artificial intelligence at a university.

Source: People familiar with the matter.

• Wadhwani oversaw merger and acquisition activities at Reliance Indsutries for over 10 years

• A representative for Reliance Industries declined to comment on Wadhwani's departure.

Source: Bloomberg

Shares of Indraprastha Gas Ltd. rose over 11%, the most in over 15 months since Nov. 27, 2020.

• The company increased the price of compressed natural gas for New Delhi and neighboring suburbs by as much as Rs 1 per kg from Tuesday, according to a statement in its website.

• The company did not change the prices of piped natural gas.

• Price increased by Rs 0.5 per kg in Delhi and Gurugram while the cost was hiked by Rs 1 per kg in Noida and Ghaziabad.

• Trading volume on the stock was over nine times the 30-day average volume at this time of the day.

• Of the 35 analysts tracking the company, 28 maintain 'buy', four suggest 'hold' and three recommend 'sell'. The overall consensus price of analysts tracked by Bloomberg implies an upside of 48.5%.

• Morgan Stanley maintained 'equal weight/in-line' recommendation on the stock with the target price kept unchanged at Rs 651; an implied return of 77.53%.

Source: Bloomberg, Company Statement

India's stock benchmarks fell, dragged by losses in metals, auto, energy and banking stocks, as global equities declined amid surge in oil prices and escalation in Russia-Ukraine tensions.

The S&P BSE Sensex fell 0.74% to 52,449.67. The 30-stock gauge fell nearly 1% to an intraday low of 52,333.61. The NSE Nifty 50 declined by similar magnitude to 15,725.10.

The broader indices outperformed their larger peers with the S&P BSE Midcap falling 0.1% and S&P BSE SmallCap rising 0.2%. Thirteen of the 19 sectoral indices compiled by BSE Ltd. declined with S&P BSE Metal, Power, Auto, Banking and Energy indices shedding around 2%. On the flipside, the S&P BSE Information Technology and Teck indices added 2%.

The market breadth was skewed in the favour of bulls. About 1,785 stocks advanced, 1,364 declined and 135 remained unchanged.

• UPI for feature phones branded as UPI123Pay

• Will help NPCI reach its goal of processing a billion transactions a day

• Will also help RBI reach its objective of a less-cash economy

• UPI123Pay to expand options available to feature phone users.

• Number of digital transactions have grown over five times.

• Large part of this limited to those who hold smart phones.

• More limited payment options available to feature phone users.

• Feature phone users can now use UPI to transfer funds through UPI123 pay

• Users can transfer funds through IVR number, App functionality, missed calls and proximity sound-based payments.

• Customers can perform P2P payments, utility bill payments, FASTag recharge, pay mobile bills, etc. through UPI123 pay.

• Majority of UPI functionality available on smartphones will now also be available on feature phones except scan and pay

• UPI payments have continued to rise significantly, says RBI Governor

• Volume of transactions in the current fiscal so far at Rs 76 lakh crore.

• On track to achieving Rs 100 lakh crore in UPI transactions soon.

Source: RBI event

Shares of Ramkrishna Forgings Ltd. rose over 8.5%, the best day in over six months.

• Trading volume on the stock was six times the 30-day average volume at this time of the day.

• In an exchange filing, the Kolkata-based company said it entered into a supply pact with a leading axle manufacturer in the U.S.for its products.

• The company expects to win Rs 70 crore order over next five years through the supply agreement in the U.S. market.

• All the five analysts tracking the company maintain 'buy'. The return potential on the stock is 66%.

Source: Exchange Filing, Bloomberg

Alembic Pharma's joint venture with Orbicular Pharma, Aleor Dermaceuticals secured U.S. FDA's final approval for Nystatin and Triamcinolone acetonide ointment.

• The drug is indicated for the treatment of fungal skin infections including cutaneous candidasis.

• The ointment, which is therapeutically equivalent to reference listed drug product Nystatin and Triamcinolone Acetonide Ointment of Taro Pharmaceuticals USA, has an estimated market size of $4 million for twelve months ending December 2021 according to IQVIA.

• Shares of Alembic Pharma rose over 2.5% in intraday trade, the most in over a week. Of the 18 analysts tracking the company, seven maintain 'buy', seven recommend 'hold' and four suggest 'sell'. The overall consensus price of analysts tracked by Bloomberg implies an upside of 15.1%.

Source: Exchange Filing, Bloomberg

Most yields along the India sovereign yield curve fell, with 30-year bonds moving the most in Tuesday morning trading.

• The 1-year yield remained unchanged at 4.851%

• The 10-year yield was little changed at 6.891%

• The 30-year yield fell 3.9bps to 7.247%

• The 2-year-10-year yield spread was 187.7bps, vs previous close 186.9bps.

Source: Bloomberg

• Chugh would be responsible for driving growth of customer acquisition through digital channels.

• He will also be implementing digital strategies for SBI.

• Prior to joining SBI Chugh served as MD & CEO of Ujjivan Small Finance Bank.

• Chugh was also head of digital banking at HDFC Bank

Source: SBI Statement

State Bank of India has 2.43 million shares change hands in two large trades. Details of buyers and sellers are not known immediately.

Source: Bloomberg

India's stock benchmarks opened lower, as the decline in global equities extended amid surging oil prices due to Russia's invasion of Ukraine.

The S&P BSE Sensex fell 0.35% to 52,656.26. The NSE Nifty 50 also declined by similar magnitude to 15,816.70. Auto, banking and metal stocks led the decline.

The broader indices outperformed their larger peers with the S&P BSE Midcap adding 0.8% and S&P BSE SmallCap gaining over 1%. Fourteen of the 19 sectoral indices compiled by BSE Ltd. advanced with S&P BSE Power and S&P BSE Utilities gaining nearly 2.5%.

The market breadth was skewed in the favour of bulls. About 1,896 stocks advanced, 556 declined and 90 remained unchanged.

Shares of Indian steel makers and related companies are in focus after CNBC-TV18 reported that NMDC, a key supplier of iron ore, is mulling price rise by Rs 400 per tonne.

• In focus: JSW Steel, Jindal Steel, Ratnamani Metals, Welspun Corp, Jindal Stainless, Jindal Stainless Hisar

Motilal Oswal

• Reiterates 'buy' on the stock with the target price reduced from Rs 4,500 to Rs 3,870; an implied return of 18.96%.

• Alkem garners maximum sales from the domestic formulation segment, which augurs well as it is well protected from the turmoil on the global front.

• Company has multiple levers to outperform the Indian pharma market in the near to medium term.

• Compliance and series of approvals have aided the company in offsetting price erosion impact in the U.S. Generics segment.

• Cuts our FY23/24 estimate by 6%/7% to factor in raw material and logistics-related headwinds.

• Remains positive on the company on the back of its superior execution in the domestic formulations segment, positive benefit of inflation-linked price hike on certain products.

• Key growth levers include revival in non-covid therapies, outperformance in chronic therapies and impact of WPI-linked price hike under NLEM.

Source: Brokerage note

Nomura India Business Resumption Index moderated to 120.5 for the week ending March 6 from 122 in the previous week. The index remains 20.5 percentage points above pre-covid levels.

• Google workplace mobility rose by 4 percentage points and retail and recreation fell by 0.7 percentage points from the previous, both well above pre-covid levels.

• Labour participation rate eased to 39.5% from 40.2% and power demand fell by 11.7% week-on-week after a 2.4% rise.

• Every 10% rise in crude oil prices negatively affects GDP growth by 0.2 percentage points.

• India may have to contend with higher prices and supply disruption for edible oils and fertilisers.

Source: Nomura

Rupee traders will parse exit poll results which showed Prime Minister Narendra Modi’s party returning to power in a key Indian state. A $5b USD/INR sell-buy forex swap by the central bank is also in focus.

• Prime Minister Narendra Modi’s party looks set to retain power in India’s most politically crucial state-- Uttar Pradesh-- exit polls predicted, indicating his popularity remains high despite rising inflation, joblessness and a devastating wave of Covid-19 infections.

• The rupee slid to a record low of 76.9812 to a dollar on Monday amid an sharp surge in crude prices.

• 10-year yields rose 7bps to 6.89% on Monday

• Global funds sell net Rs 7,480 crore of India stocks on Monday: NSE

• They bought Rs 41 crore of sovereign bonds under limits available to foreign investors, and withdrew Rs 104 crore of corporate debt

• State-run banks bought Rs 2,200 crore of sovereign bonds on March 7: CCIL data. Foreign banks sold Rs 633 crore of bonds

Source: Bloomberg

• Nuvoco Vistas cut to 'neutral' at JPMorgan; price target set at Rs 410.

• Tata Steel raised to 'buy' at ICICI Securities; price target set at Rs 1,700.

• Jindal Steel raised to 'buy' at ICICI Securities; price target set at Rs 618.

• BPCL raised to 'buy' at BOB Capital Markets; price target set at Rs 450.

• Maruti Suzuki raised to 'buy' at ICICI Securities; price target set at Rs 8,745.

Source: Bloomberg

• Dish TV: SEBI passed an interim order against the company, promoter, and MD Jawahar Goel, and the board of directors for alleged violation of listing regulations. The capital markets regulator also directed the compliance officer to disclose the voting results of the AGM and told depositories to freeze the demat accounts of Dish TV’s directors and compliance officer until they are out.

• Natco Pharma: The company first generic version of Revlimid (Lenalidomide capsules) in the U.S. market for treatment of multiple myeloma in combination with the medicine dexamethasone, certain myelodysplastic syndromes, and mantle cell lymphoma following specific prior treatment. The capsules are available in 5 mg, 10 mg, 15 mg, and 25 mg strengths.

• NLC India: The company declared interim dividend of Rs 1.5 a share.

• Metro Brands: The company declared interim dividend of Rs 1.5 a share. Sahel Kamdar resigned as chief operating officer.

• Sun TV Network: The company declared interim dividend of Rs 5 a share.

• Axis Bank: Report on Citi India retail deal speculative. Lender denies taking any such decision.

• Future Retail: Shareholders, creditors to meet on April 20-21 to discuss the Reliance deal.

• ICICI Prudential Life: February new business premium falls 22.8% year-on-year.