An employee interprets data from a graph (Photographer: Natalie Behring/Bloomberg)

Stocks To Watch: Avenue Supermarts, Bharti Airtel, Infosys, ICICI Securities, Yes Bank

Asian stocks were mixed on Monday, following the best week for regional stocks since the start of November, as investors awaited a raft of earnings and the January rally in risk assets showed signs of abating.

Shares in Australia advanced, while South Korean stocks dipped and futures indicated a small decline when equity trading begins in Hong Kong. U.S. equity futures slipped after the S&P 500 on Friday closed flat and the yield on 10-year Treasuries declined. Japan is closed for a holiday, so Treasuries won’t trade until the London open.

The Singapore-traded SGX Nifty, an early indicator of NSE Nifty 50 Index’s performance in India, rose 0.15 percent to 10,833 as of 7:10 a.m.

Short on time? well, then listen to this podcast for a quick summary of All You Need To Know before the opening bell!

Here Are The Stocks To Watch Out For In Today’s Trade

  • Infosys’ board approved buy back worth Rs 8,260 crore at a share price of not more than Rs 800 per share involving 2.36 percent equity and the tech company also declared a special dividend of Rs 4 per share. The buyback is at 17 percent premium to the current market price of Rs 683.5 per share. The management has also hiked financial year constant currency guidance to 8.5 percent to 9 percent.
  • Sun Pharma said commercialisation of Xelpros has triggered $10 million payment and sales linked royalties to Sun Pharma Advanced Research Company. The research company had licensed Xelpros to Sun Pharma in June 2015.
  • Bharti Airtel agreed to reduce its stake in its Tanzanian unit to 51 percent from 60 percent after months of negotiations with the government, which accused the operator of acquiring the initial shareholding illegally. (Bloomberg News)
  • BLS International announced expansion of operations for Attestation and Apostille services following the renewal of its contract with Ministry of External Affairs. The company said that it will add 11 cities to its profile because of the renewal of the contract.
  • NTPC to raise Rs 4,000 crore via Non-Convertible Debentures.
  • KNR Constructions’ arm received financial closure from NHAI for projects in Tamil Nadu and Andhra Pradesh worth Rs 22,121 crore.
  • Shakti Pumps extended its production shut down till Jan.12. The company’s operation has been shut down since Jan. 09 due to labour contractor issues with the company.
  • IL&FS Engineering and Construction: Gujarat Metro Rail Corporation terminated contract with company for construction of metro rail corridor in Ahmedabad citing the reason of slow progress. The Rail Corporation may encash Bank Guarantees provided by the company amounting to Rs 37.5 crore.
  • Hindusthan National Glass to raise Rs 394 crore by issuing compulsorily convertible preference shares at Rs 83.77 to Lotus One Investment. Preference shares will be converted into equity shares after 18 months.
  • Cadila Healthcare: Zydus receives final approvals from the U.S. FDA for Betamethasone Dipropionate Cream and Amlodipine & Atorvastatin Tablets. Cream is used to treat a variety of skin conditions, while the tablets are used to treat blood pressure and cholesterol.
  • Yes Bank named Brahm Dutt as the part-time chairman. Reserve Bank of India approved his appointment up till July 04, 2020 vide its letter dated Jan. 11.

Also read: In Charts: TCS Vs Infosys

Media Reports

  • Government mulls raising minimum selling price of sugar (Economic Times)
  • Jet Airways’ 18 aircraft held back in Singapore over unpaid dues (Business Standard)
  • Finance Ministry may sell part of SUUTI holding in Axis Bank, ITC (PTI)

Earnings To Watch

  • Indiabulls Ventures
  • ICICI Securities
  • Tata Metaliks
  • Supreme Infrastructure
  • Prakash Industries

Earnings Reactions To Watch

Infosys (Q3, QoQ)

  • Net Profit down 12.2 percent at Rs 3610 crore.
  • $Revenue up 2.3 percent at $2,987 million.
  • Revenue up 3.8 percent at Rs 21,400 crore.
  • EBIT down 10.5 percent at Rs 4,379 crore.
  • Adjusted EBIT Margin at 22.6 percent versus 23.7 percent.

Also read: Q3 Results: Infosys Raises Revenue Forecast On Strong Deal Momentum

GNA Axles (Q3, YoY)

  • Net profit up 42 percent at Rs 18 crore.
  • Revenue up 47 percent at Rs 246 crore.
  • Ebitda up 45 percent at Rs 39 crore.
  • Margin at 15.8 percent versus 16.1 percent.

Avenue Supermarts (Q3, YoY)

  • Net Profit up 2 percent at Rs 257 crore.
  • Revenue up 33 percent at Rs 5,451 crore.
  • Ebitda up 7.5 percent at Rs 453 crore.
  • Margin at 8.3 percent versus 10.3 percent.
  • Added 4 stores during the quarter; Total store count at 164.
  • Margins dropped on account of price cuts and higher operating hours during festive season.

Also read: Q3 Results: DMart Net Profit Growth Slowest In Eight Quarters

Tata Sponge Iron (Q3, YoY)

  • Net Profit down 25.6 percent at Rs 27 crore.
  • Revenue up 22 percent at Rs 261 crore.
  • Ebitda down 37 percent at Rs 30 crore.
  • Margin at 11.6 percent versus 22.4 percent.
  • Higher raw material cost, other expenses and employee cost weighed on Q3 results
  • Raw material cost as a % of revenue grew to 75 percent from 64 percent.
  • Other expenses and employee cost were on an average 21 percent higher.

J&K Bank (Q3, YoY)

  • Net Interest Income up 13 percent at Rs 882 crore.
  • Net Profit up 43 percent at Rs 104 crore.
  • Provisions up 52 percent at Rs 263 crore (QoQ).
  • GNPA at 9.94 percent versus 9 percent (QoQ).
  • NNPA at 4.69 percent versus 3.91 percent (QoQ).

Who’s Meeting Whom

  • Mahindra & Mahindra to meet Canara HSBC Life Insurance on Jan. 17.

Insider Trading

  • Rico Auto Industries promoters acquired 18,000 shares from Jan. 09-10.
  • Jindal Stainless promoter and director acquired 32,000 shares from Jan. 09-10.

(As reported on Jan.11)

Trading Tweaks

  • SPL Industries to move into ASM Framework
  • Deccan Healthcare price band revised to 20 percent.

Money Market Update

  • Rupee ended at 70.50/$ on Friday versus $70.41/$ on Thursday.

F&O Cues

  • Nifty January futures closed trading at 10828, premium of 33 points.
  • Max OI for January series at 11,000 Call, OI at 46.9 lakh shares.
  • Max OI for January series at 10,500 Put, OI at 38.9 lakh shares.

Stocks In F&O Ban

  • Adani Power
  • Jet Airways

Put-Call Ratio

  • Nifty PCR at 1.39 versus 1.46.
  • Nifty Bank PCR at 0.9 versus 0.92.

Brokerage Radar

On Infosys

CLSA

  • Maintained ‘Buy’; hiked price target to Rs 930 from Rs 910.
  • December quarter review: stellar revenue growth and deal wins and raised guidance.
  • Growth was broad-based led by key geographies, key verticals and digital.
  • Growth acceleration, capital return and a demand recovery merit a rerating.

PhillipCapital

  • Maintain “Buy”; increased price target to Rs 800 from Rs 750.
  • Strong performance; small miss on margins.
  • Expect strong revenue growth in coming quarters due to recent performance and deal flow momentum.
  • Remain positive on the back of improving business metrics and significant valuation gap to Tata Consultancy Services.

Investec

  • Maintain “Buy”; cut price target to Rs 784 from Rs 820.
  • Solid beat on revenue; margin weakness to continue.
  • Announced buyback to restrict downsides on the stock.
  • With growth coming back, believe valuation gap with TCS to narrow.

Also read: Q3 Results: Brokerages Remain Upbeat On Infosys     

More Calls

JM Financial on Avenue Supermarts

  • Maintained ‘Buy’ with a price target of Rs 1,740.
  • December quarter turned out to be another disappointing quarter.
  • Revenue momentum sustained quite well; store expansion quite muted .
  • The current financial year is a margin-reset year for the company with relatively ‘muted’ Ebitda growth.