Stocks To Watch: Berger Paints, Indiabulls Housing Finance, SRF, Titan, Yes Bank

U.S. stocks clocked their biggest drop of the year on Monday. Asian stocks plunged again today and American futures slumped after the U.S. slapped the currency-manipulator tag on China, further escalating the trade war between the world’s two largest economies.

The MSCI Asia Pacific Index dropped more than 1 percent, bringing its sell-off over the past week to about 6 percent. The Singapore-traded SGX Nifty, an early indicator of NSE Nifty 50 Index’s performance in India, fell 0.7 percent to 10,797 as of 7:40 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

• Bank of Baroda reduced MCLR rates by 15 basis points across various tenors with effect from Aug. 7. One month MCLR is at 8.15 percent versus one-year MCLR at 8.45 percent.
• SRF board approved setting of an integrated facility for development of PTFE at an estimated cost of Rs. 424 crore, which will add 5,000 MTPA of capacity addition. The company stated that it will enter into fluoropolymers segment of fluorocarbons to derive cost advantage from the integrated value chain.
• Yes Bank: Moody's Investors Service extended its review for downgrade of the bank’s ‘Ba1’ long-term foreign-currency issuer rating. Moody's also extended its review for downgrade of the bank’s long-term foreign and local-currency bank deposit ratings of ‘Ba1’, foreign-currency senior unsecured MTN program rating of ‘(P)Ba1’, and Baseline Credit Assessment and adjusted BCA of ‘ba2’.
• Cox & Kings defaulted on payment of commercial papers worth Rs 5 crore which was due on Aug. 5.
• Tata Motors: ICRA downgraded long-term facilities to ‘AA-’ from ‘AA’, with outlook remaining negative due weakening of financial profile at Jaguar Land Rover Business.
• Wabco to close operations in five of its plants for three-17 days in August in view of weak demand and customer schedules.
• Music Broadcast acquired commercial rights to sell advertising space at Lucknow metro stations and play curated content for three years.
• IL&FS Transportation Networks defaulted on non-convertible debentures interest payment worth Rs 14.7 crore which was due on Aug. 5.
• Tata Power’s arm commissioned 70 KW solar roof top installation at Delhi’s India International Centre.
• HCL Tech and Oracle Health Services to collaborate to life science companies for generation of digital clinical trials.
• Minda Corporation: The National Company Law Tribunal approved amalgamation of five domestic arms with self.
• Wipro’s arm opened a new strategic design studio in Sydney.
• Muthoot Finance to consider raising funds on Aug. 12.
• IOL Chemicals & Pharma stated that they have made pre-payment of term loan of Rs 14 crore due to banks in addition to regular repayment schedule. Till date the company has prepaid Rs 98.18 crore of pre-payments to reduce debt.

(Corrects an earlier version that misstated Tata Motors' rating.)

Earnings Reaction To Watch

Berger Paints (Q1, YoY)

• Revenue rose 15.7 percent to Rs 1,716.5 crore. (estimate Rs 1,646.3 crore)
• Net profit jumped 32 percent to Rs 176.8 crore. (estimate Rs 150 crore)
• Ebitda was up 27.4 percent to Rs 305.1 crore. (estimate Rs 258 crore)
• Margin at 17.8 percent versus 16.1 percent.

Entertainment Network (Q1, YoY)

• Revenue rose 8.9 percent to Rs 132.4 crore. (estimate Rs 131.6 crore)
• Net profit fell 58.1 percent to Rs 3.9 crore. (estimate Rs 11 crore)
• Ebitda was up 17 percent to Rs 33.1 crore. (estimate Rs 30.9 crore)
• Margin at 25 percent versus 23.3 percent.
• Depreciation jumped 64 percent to Rs 25 crore, finance cost was up 5.4 times to Rs 4.9 crore.
• Production expenses rose 41 percent to Rs 28.8 crore.

Dilip Buildcon (Q1, YoY)

• Revenue fell 6.1 percent to Rs 2,288 crore. (estimate Rs 2,506 crore)
• Net profit was down 50.9 percent to Rs 125.2 crore. (estimate Rs 150 crore)
• Ebitda was down 4.7 percent to Rs 412.1 crore. (estimate Rs 448.5 crore)
• Margin at 18 percent versus 17.8 percent.
• Depreciation surged 39 percent, finance cost rose 31 percent.

SRF (Q1, YoY)

• Revenue rose 9.1 1 percent to Rs 1,828.4 crore. (estimate Rs 1,913 crore)
• Net profit was up 41.4 percent to Rs 189.2 crore. (estimate Rs 146 crore)
• Ebitda was up 9.9 percent to Rs 350.1 crore. (estimate Rs 326.8 crore)
• Margin at 19.1 percent versus 19 percent.
• Other income of Rs 15 crore and tax reversal of Rs 13.2 crore in current quarter.
• Declared dividend of Rs 7 per share.

Indian Hotels (Q1, YoY)

• Revenue rose 4.1 percent to Rs 1,020 crore.
• Net profit was down 62.7 percent to Rs 5.7 crore.
• Ebitda jumped 56.9 percent to Rs 173.5 crore.
• Margin at 17 percent versus 11.3 percent.
• Finance cost surged 81 percent to Rs 84.7 crore, depreciation rose 28 percent to Rs 100.4 crore.

KEI Industries (Q1, YoY)

• Revenue rose 22.3 percent to Rs 1,081.4 crore. (estimate Rs 1,052.2 crore)
• Net profit was up 42.3 percent to Rs 45.8 crore. (estimate Rs 40.5 crore)
• Ebitda was up 32.4 percent to Rs 114.1 crore. (estimate Rs 109.5 crore)
• Margin at 10.6 percent versus 9.8 percent.

Torrent Power (Q1, YoY)

• Revenue rose 5.9 percent to Rs 3,736.1 crore.
• Net profit was up 21.9 percent to Rs 275.3 crore.
• Ebitda rose 8.8 percent to Rs 833.7 crore.
• Margin at 22.3 percent versus 21.7 percent.

Mangalam Cement (Q1, YoY)

• Revenue rose 30.9 percent to Rs 333.2 crore.
• Net profit was at Rs 33.2 crore versus net loss of Rs 15.3 crore.
• Ebitda was up 14 times to Rs 68 crore.
• Margin at 20.41 percent versus 1.9 percent.

PNB Gilts (Q1, YoY)

• Revenue jumped 93.7 percent to Rs 193.5 crore.
• Net profit stood at Rs 45.2 crore versus net loss of Rs 44.2 crore.

Nifty Earnings To Watch

• Indiabulls Housing Finance
• Titan

Other Earnings To Watch

• JSW Energy
• Arvind
• Pidilite Industries
• REC
• Thomas Cook
• Aditya Birla Fashion and Retail
• Fortis Healthcare
• JK Lakshmi Cement
• Sheela Foam
• Gujarat State Fertilizers & Chemicals
• Hawkins Cookers
• Alkyl Amines Chemicals
• Asahi India Glass
• Asian Granito
• BASF India
• Bharat Gears
• Borosil Glass Works
• Khadim
• KIOCL
• Kolte-Patil Developers
• Lakshmi Vilas Bank
• Linc Pen & Plastics
• Lux Industries
• Manali Petrochemicals
• Max Financial Services
• Metropolis Healthcare
• Minda Industries
• National Peroxide
• Central Bank of India
• Deccan Cements
• Excel Crop Care
• HSIL
• Indo Rama Synthetics (India)
• IRB Infrastructure Developers
• JHS Svendgaard Laboratories
• Nilkamal
• NLC India
• Shemaroo Entertainment
• Shree Renuka Sugars
• Shriram EPC
• Sundaram Finance
• Investment Trust Of India
• Xelpmoc Design And Tech
• Zensar Technologies

Offerings

• Sterling and Wilson allocated 1.8 crore shares to anchor investors at Rs 780 per share, aggregating to Rs 1,406 crore. Investors include Nomura India, Schroder International and Reliance Capital.
• Spandana Sphoorty Financial IPO gets 6 percent demand on first day sale; offer to close Aug. 7.

Bulk Deals

• Indian Terrain Fashions: Limiar Fund (Master) LP sold 7.47 lakh shares or 1.97 percent equity at Rs 77.4 each.

Trading Tweaks

• GFL ex-date for demerger.
• Coffee Day Enterprises, Sical Logistics, SPML Infra to move into ASM Framework.
• Alphageo, Bliss GVS Pharma, CARE Ratings to move into short term ASM Framework.
• Gati price band revised to 10 percent.
• Coffee Day Enterprises, Sical Logistics price band revised to 5 percent.

Insider Trading

• Vaibhav Global promoter and director Nirmal Bardiya sold 2.25 lakh shares on Aug. 2.

Money Market Update

• Rupee had its biggest intraday fall in six years and closed at 70.73/$ versus 69.60/$ on Friday.

F&O Cues

August Futures

• Nifty futures closed at 10,896.8, premium of 34 points Versus 26.7 points
• Nifty futures OI up 4 percent, adds 7.2 lakh shares in OI
• Bank Nifty futures closed at 27,795.7, premium of 147.7 points Versus 122 points
• Bank Nifty futures OI up 12 percent, adds 2 lakh shares in OI

Options

• Nifty PCR at 1.01 versus 1.18 (across all series)

Nifty Weekly Expiry Aug 8

• Max OI on call side at 11,200 (24.8 lakh shares)
• Max OI on put side at 10,500 (12.8 lakh shares)
• Max OI addition seen in 10,900C (+10.6 lakh shares), 11,000C (+9.3 lakh shares)
• OI shedding seen in 11,000P (-8.8 lakh shares), 10,900P (-5.5 lakh shares)

Nifty Monthly Expiry Aug 29

• Max OI on call side at 11,500 (22.1 lakh shares)
• Max OI on put side at 11,000 (29.9 lakh shares)

Brokerage Radar

On Reliance Industries

CLSA

• Maintained ‘Buy’ with a price target of Rs 1,530.
• Jio’s 2018-19 free cash flow worsened but is set to improve.
• FTTH launch, subscriber ramp-up and stake sale in InvITs are triggers.
• Expect return ratios to improve going forward.

UBS

• Maintained ‘Buy’ with a price target of Rs 1,500.
• Higher capital expenditure weighed on FCFE, though deleveraging has begun.
• Potential deleveraging and right-sizing of balance sheet is key trigger.
• Consumer businesses' share in total Ebitda continues to rise.

More Calls

BofA Securities on Bharat Forge

• Downgraded to ‘Neutral’ from ‘Buy’; cut price target to Rs 450 from Rs 540.
• Earnings likely to hit speed bump but FCF healthy.
• Slowing export momentum a risk to near term earnings.
• Multiples now at long term cyclical average.

Macquarie on Ujjivan Financial

• Maintained ‘Neutral’; cut price target to Rs 260 from Rs 350.
• Cut price target as it increased holding company discount.
• Business performance is doing well, but unfortunately is not a catalyst anymore.
• Investors should consider investing in Small Finance Bank once listed.

UBS on Indian Hotels

• Maintained ‘Buy’ with a price target of Rs 185.
• Resilient in tough environment; expansion plans on track.
• Cost rationalization and strong performance of St. James aided profitability.
• Management initiatives to play-out over medium term.

Morgan Stanley on L&T Infotech

• Initiated ‘Overweight’ with a price target of Rs 1,780.
• Expect core business growth to outpace that of most peers.
• L&T's purchase of Mindtree could suggest an opportunity to benefit from synergies.
• Valuation is attractive; preferred mid-cap pick.