Sensex, Nifty Clock Best Single Day Gains In Four Weeks Led By Bajaj Twins

India stocks rose for a third consecutive day as global support continued to pour in to boost efforts to curb the spread of new coronavirus cases and speed up vaccination.

The S&P BSE Sensex rose 1.61% to 49,733.84 while the NSE Nifty 50 Index gained 1.44% to 14,864.55. Both the benchmarks gained the most since March 30.

Broader markets slightly underperform their larger peers. The S&P BSE SmallCap index gained 0.71% while the S&P BSE MidCap rose nearly 1%.

Fifteen of the 19 sector sub-indexes compiled by BSE Ltd. climbed, led by a gauge of banks. The S&P BSE Realty was the worst-performing index, down 0.5%

Overseas investors have sold $1.2 billion of local stocks through April 23, the biggest outflow since March last year, when the nation imposed one of the strictest nationwide lockdown in the world to curb the spread of the pandemic.

New global coronavirus cases rose for the ninth consecutive week by a record 5.7 million, as a 52% surge in India outweighed declines in most regions, the World Health Organization said. India’s death toll surpassed 200,000.

Wipro or Tata Steel may replace ONGC in benchmark S&P BSE Sensex Index after BSE’s review of the gauge in June, Brian Freitas, an analyst on Smartkarma writes in a note.

• Index changes will be effective after the close of trading on June 18 and the results of the review will be announced 4 weeks prior to that date

The rupee advances to its highest level in nearly two weeks as plans to accelerate vaccinations spur optimism the coronavirus-induced restrictions will have less impact on the economy. Sovereign bonds trade slightly lower.

• Traders are expecting that vaccines would be key for the recovery and could mean that the impact on mobility and economic activity won’t be as bad as last year, says Madhavi Arora, an economist at Emkay Global Financial Services
• “Asian currencies are slightly weaker as the market takes a cautious stance ahead of the FOMC meeting,” says Khoon Goh, head of Asia research at ANZ in Singapore
• The Fed is likely to stick to its policy path at its meeting which ends Wednesday and investors are watching for any signs of the central bank pulling back on asset purchases

Source: Bloomberg

• SBI to conduct public offer or private placement of senior unsecured notes in U.S. dollar or any other convertible currency during FY22
• Bank to raise funds through single or multiple tranches

• Bajaj Finance options volume 3.5x the 20-day average, with 90,818 calls changing hands vs 41,508 puts
  • Stock up 7.2%, volume 2.1x the 20-day average for this time of day
• Bajaj Finserv options volume 3x the average, with 16,146 calls vs 4,329 puts
  • Stock up 3.8%, volume 1.7x the average
• Axis Bank options volume 2.5x the average, with 58,461 calls vs 34,934 puts
  • Stock up 0.4%, volume 1.9x the average
• Bajaj Auto options volume 1.8x the average, with 7,975 calls vs 1,995 puts
  • Stock up 3.6%, volume 1.5x the average
• Britannia options volume 1.7x the average, with 8,156 calls vs 3,334 puts
  • Stock down 1.2%, volume 1.8x the average
• Eicher Motors options volume 1.7x the average, with 5,395 calls vs 1,159 puts
  • Stock up 4.4%, volume 1.1x the average
• Hero MotoCorp options volume 1.6x the average, with 12,862 calls vs 3,737 puts
  • Stock up 1.3%, volume 1.2x the average

Bajaj Finserv reported net income for the fourth quarter of Rs 979 crore versus Rs 1,290 crore QoQ and Rs 194 crore YoY.

• Revenue Rs 15,390 crore, down 3.6% QoQ, up 16% YoY
• Total costs Rs 13,030 crore, +4.2% y/y
• Dividend per share Rs 3

Shares of the Pune-based lender rose as much as 7%, the most since Feb 01, after it reported a sharp rise in fourth-quarter net profit.

Net profit rose 42% to Rs 1,347 crore in the January-March period from Rs 948 crore a year ago, as per its exchange filing. The reported net profit was lower than the Rs 1,370.5-crore consensus estimate of analysts tracked by Bloomberg.

Net interest income fell 2.4% to Rs 4,569 crore at the end of the March quarter, compared to Rs 4,684 crore a year ago.

Market Insight

• Trading volume was 6.3 million shares, triple the 20-day average of 1.92 million shares for this time of day.
• Trading in the company's call options totaled 97,994 contracts, compared with the average of 22,485 over the past 20 days. Trading in the company's put options totaled 44,234 contracts, compared with the average of 15,607 over the same period.
• One-month implied volatility was 41%.
• Analysts have 16 buy, six hold, and eight sell recommendations on the stock.

Analyst Rating Changes:

• Spark Capital Advisors analyst Abhinesh Vijayarajupgraded the recommendation on Bajaj Finance to reduce and assigned a target price of Rs 4,666.
• Elara Securities India Pvt Ltd analyst Mahrukh Adajaniaupgraded the recommendation to reduce and assigned a target price of Rs 4,630.
• Motilal Oswal Securities Ltd analyst Alpesh Mehtaupgraded the recommendation on Bajaj Finance to buy and assigned a target price of Rs 5,865.
• Emkay analyst Jignesh Shial downgraded the recommendation on Bajaj Finance to hold and assigned a target price of Rs 5,400.

Read what brokerages made of Bajaj Finance’s Q4 performance here

Zomato Ltd., an Indian food delivery startup backed by Jack Ma’s Ant Group, sought regulatory approval for an initial share sale of as much as 82.5 billion rupees ($1.1 billion), according to documents filed with the Securities & Exchange Board of India.

• The IPO will comprise of the issue of fresh sale of as much as Rs 7,500 crore and an offer for sale by shareholder Info Edge India Ltd. for Rs 750 crore
• Kotak Investment Banking, Morgan Stanley, Credit Suisse, BofA Securities and Citi are the bankers for the IPO

Shares of the FMCG major fell as much as 2% after its fourth-quarter profit fell amid rising input costs and a shutdown last month to implement three digital projects.

Net profit of the maker of Good Day and Tiger biscuits declined 3% year-on-year to Rs 364.32 crore in the quarter ended March, according to its exchange filing. That compares with the Rs 416.9-crore consensus estimate of analysts tracked by Bloomberg.

Read the full earnings report here

The broking firm downgraded the stock to equal-weight from overweight. It revised its target price to Rs 3,742 from earlier R 4,287.

Shares of the automaker jumped as much as 17.25% to Rs 664, the biggest jump since Sept 2014, after it posted a nearly four-fold increase in its consolidated net profit to Rs 319.19 crore for the fourth quarter.

Revenue from operations rose to Rs 6,131.90 crore in the fourth quarter from Rs 4,104.71 crore in the same period of 2019-20 fiscal, TVS Motor said in a regulatory filing.

During the period under review, the company said its total two-wheeler and three-wheeler sales across domestic and international markets stood at 9.28 lakh units, up 47% from 6.33 lakh units sold in the fourth quarter of 2019-20.

While commodities continue to inch upwards, the company was able to mitigate the impact via price hikes and better mix (exports and scooters), according to CLSA.

"While the stock continues to trade at a premium to its mass-market two-wheeler peers (50% over Hero Motocorp and Bajaj Auto), we believe this can continue due to share gains, higher EPS growth and improving FCF conversion," the broking firm said in a note.

Indian equity benchmarks climbed buoyed by earnings even as investors remained cautious ahead of the Federal Reserve’s policy decision.

The S&P BSE Sensex climbed 0.8% to 49,334.16, while the NSE Nifty 50 Index gained 0.7% to 14,760.15. All but two of the 19 sector sub-indices compiled by BSE Ltd. advanced, led by a gauge of auto companies.

The U.S. this week said it will help India by sending items needed to manufacture vaccines as part of an aid package. European countries are also pledging support after the South Asian country saw record numbers of new cases. India today began registering people from 18 years of age to get vaccinations from May 1.

The outbreak in India poses downside risks to GDP and heightens the possibility of business disruptions, S&P said in a report, signalling that it may revise its growth forecasts.

• Negative credit spillovers to S&P rated portfolio remains limited, but the situation is fluid
• High absolute number of infections in India also presents a significant contagion risk to other geographies
• A drawn-out COVID-19 outbreak will impede India’s economic recovery, which S&P says will prompt a revision of the base-case assumption of 11% growth over fiscal 2021/2022, particularly if the government is forced to reimpose broad containment measures

Good morning!

Asian stocks opened on a cautious note Wednesday as investors considered a renewed rise in Treasury yields, a jump in commodity prices and a raft of earnings from U.S. technology heavyweights.

Shares posted modest gains in Japan but slipped in South Korea. U.S. contracts were steady after the Nasdaq 100 dropped for the first time in three sessions amid declines in heavyweights such as Tesla Inc.

The S&P 500 closed little changed after swinging between gains and losses. Bonds weakened, with 10-year Treasury yields advancing back above 1.6% as investors await the Federal Reserve’s policy decision.

A market gauge of inflation expectations over the next decade hit an eight-year high amid the rally in commodities. Oil climbed after OPEC+ projected a strong recovery beyond the near-term setbacks to demand from India’s Covid-19 surge.

India's SGX Nifty 50 Index futures for April delivery rose 0.1% to 14,677.00, while MSCI Asia Pacific Index -0.1%. The NSE Nifty 50 Index added 1.2% Tuesday to 14,653.05.

Axis Bank, Bajaj Finance, Britannia, TVS Motor, ABB, Nippon Life, HDFC AMC, PNB Housing may react as the companies reported quarterly results after the market closed Tuesday. Biocon, Bajaj Finserv, UTI Asset are the companies scheduled to report earnings Wednesday. Foreign investors sold net Rs 1,055b crore of stocks on Monday, according to the NSDL website.