Stocks To Watch: BPCL, DLF, HPCL, Panacea Biotec, Tech Mahindra, Tata Motors

Asian stocks opened to modest losses Tuesday as investors digested moves by the U.S. against Huawei Technologies Co. that sank U.S. technology shares overnight.

Stocks dipped in Tokyo and Sydney, and were little changed in early trading in Seoul. Futures pointed to losses in Hong Kong and China. The Singapore-traded SGX Nifty, an early indicator of NSE Nifty 50 Index’s performance in India, rose 0.16 percent to 11,884.50 as of 7 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

• Adani Green Energy’s promoters Adani Tradeline LLP and Universal Trade and Investments plan to sell cumulatively 5.59 percent stake in the company. The promoters will sell up to 8.75 crore shares at a floor price of Rs 43 apiece—a discount of about 0.20 percent to current market price—through an offer-for-sale, according to an exchange filing.
• Tata Motors: Jaguar Land Rover Automotive said Chief Financial Officer Ken Gregor to step down on June 1, and will be succeeded by Adrian Mardell, according to a website statement. (Bloomberg News)
• GAIL India to consider bonus issue on May 27.
• Panacea Biotec’s formulation facility in Himachal Pradesh received a U.S. FDA approval for manufacture and supply of Azacitidine Injection for the U.S. Market. This injection is a chemotherapy drug.
• ICICI Bank entered into an agreement with the BSE and IFSC for acquiring 9.9 percent stake in India International Clearing Corporation (GIFT City) for Rs 33.85 crores.
• Lakshmi Vilas denied any misappropriation of monies due to Religare’s arm on account of four fixed deposits opened with the Bank.
• 8K Miles Software: Board sought extension permission for submitting annual audited results up till June 30, due to delay seen in compilation of consolidated financial statement of the company.

Nifty Earnings To Watch

• Tech Mahindra

Other Earnings To Watch

• DLF
• Jindal Steel & Power
• Aarti Industries
• Subros
• Alkyl Amines Chemicals
• Bharat Financial Inclusion
• Bosch
• Care Ratings
• Prataap Snacks
• Somany Ceramics
• Century Enka
• Cochin Shipyard
• Crompton Greaves Consumer Electricals
• Dhanuka Agritech
• Eris Lifesciences
• IFCI
• India Glycols
• J.B.Chemicals & Pharmaceuticals
• Jamna Auto Industries
• KEI Industries
• KIOCL
• NR Agarwal Industries
• Prakash Industries
• Rane Engine Valve
• RSWM
• Surya Roshni
• Tamilnadu PetroProducts
• Timken India
• Triveni Engineering & Industries
• UFO Moviez
• VA Tech Wabag
• Vaibhav Global
• Aptech
• Banco Products
• Deccan Gold Mines

Earnings Reaction To Watch

Tata Motors (Q4, YoY)

• Revenue down 4 percent to Rs 86,422 crore.
• Net profit down 47 percent to Rs 1,117.5 crore.
• Ebitda down 6 percent to Rs 8019.5 crore.
• Margin at 9.3 percent versus 9.5 percent.

JLR (Q4, YoY)

• Revenue down 5.6 percent at GBP 7134 million.
• Ebitda margin at 9.8 percent.

BPCL (Q4. QoQ)

• Revenue down 6.5 percent to Rs 73,990 crore.
• Net profit up 6.3 times to Rs 3,125 crore.
• Ebitda up 6.5 times to Rs 4,805 crore.
• Margin at 6.5 percent versus 0.9 percent.
• Gross refining margin at $2.74/bbl versus $2.78/bbl.

HPCL (Q4, QoQ)

• Revenue down 5.8 percent to Rs 67,938.1 crore.
• Net profit up 12 times to Rs 2,969.9 crore.
• Ebitda up 5.4 times to Rs 5,166.3 crore.
• Margin at 7.6 percent versus 1.3 percent.
• Gross refining margin at $4.51/bbl versus $3.72/bbl.

Philips Carbon Black (Q4, YoY)

• Revenue up 21.9 percent to Rs 921 crore.
• Net profit up 0.3 percent to Rs 74.4 crore.
• Ebitda up 10.6 percent to Rs 112.8 crore.
• Margin at 12.2 percent versus 13.5 percent.
• Deferred tax reversal of Rs 19.7 crore in base quarter.
• Other expenses up 26 percent to Rs 163.3 crore.

HEG (Q4, YoY)

• Revenue up 4.2 percent to Rs 1,346.7 crore.
• Net profit down 17.3 percent to Rs 524.4 crore.
• Ebitda down 17.1 percent to Rs 788.1 crore.
• Margin at 58.5 percent versus 73.6 percent.
• RM as percent of sales at 34.5 percent versus 15.5 percent.
• Declares dividend of Rs 50 per share.

Jindal Stainless (Q4, YoY)

• Revenue up 2.5 percent to Rs 3,251.3 crore.
• Net profit down 71.8 percent to Rs 32.3 crore.
• Ebitda down 22.1 percent to Rs 302.5 crore.
• Margin at 9.3 percent versus 12.2 percent.
• RM as percent of sales at 57.5 percent versus 49 percent.

Astral Poly Technik (Q4, YoY)

• Revenue up 21.3 percent to Rs 774.7 crore.
• Net profit down 4.2 percent to Rs 62.2 crore.
• Ebitda up 6.1 percent to Rs 120.3 crore.
• Margin at 15.5 percent versus 17.8 percent.
• RM as percent of sales at 62 percent versus 60 percent.
• Other expenses up 46 percent to Rs 105 crore.

Lakshmi Machine Works (Q4, YoY)

• Revenue down 22.4 percent to Rs 580 crore.
• Net profit down 39.9 percent to Rs 36.8 crore.
• Ebitda down 51.9 percent to Rs 32.5 crore.
• Margin at 5.6 percent versus 9 percent.
• Declares dividend of Rs 35 per share.

Confidence Petroleum India (Q4, YoY)

• Revenue up 1.1 percent to Rs 286.1 crore.
• Net profit up 1.1 percent to Rs 18.8 crore.
• Ebitda down 4 percent to Rs 33.9 crore.
• Margin at 11.8 percent versus 12.5 percent.
• Other expenses up 2.4 times to Rs 46.8 crore.

Shree Pushkar Chemicals & Fertilisers (Q4, YoY)

• Revenue down 2.1 percent to Rs 117.6 crore.
• Net profit down 19.1 percent to Rs 7.6 crore.
• Ebitda down 13.8 percent to Rs 10.6 crore.
• Margin at 9 percent versus 10.2 percent.
• Tax Reversal of Rs 4.5 crore.
• Employee expenses up 18 percent to Rs 6.7 crore.

Dhampur Sugar Mills (Q4, YoY)

• Revenue down 3.6 percent to Rs 888.4 crore.
• Net profit of Rs 107.8 crore versus net loss of Rs 9.2 crore.
• Ebitda up 15 times to Rs 180.6 crore.
• Margin at 20.3 percent versus 1.3 percent.
• Inventory gain of Rs 674 crore versus inventory gain of Rs 472.2 crore.

Torrent Pharma (Q4, YoY)

• Revenue up 8.7 percent to Rs 1,856 crore.
• Net loss of Rs 152 crore versus net profit of Rs 228 crore.
• Ebitda up 29.9 percent to Rs 473 crore.
• Margin at 25.5 percent versus 21.3 percent.
• Exceptional loss of Rs 357 crore.

United Breweries (Q4, YoY)

• Revenue up 10.7 percent to Rs 1,629.4 crore.
• Net Profit down 25.3 percent to Rs 67.9 crore.
• Ebitda down 17.8 percent to Rs 171.2 crore.
• Margin at 10.5 percent versus 14.1 percent.
• Higher employee cost and higher other expenses weighed on Ebitda.
• In Q4, volume grew in all markets except West Bengal, Uttar Pradesh and Maharashtra.

Pledge Share Details

• Eros International Media promoter Eros Worldwide created pledge of 16.8 lakh shares from May 14-15.
• Adani Ports & SEZ promoter grouping Adani Trading LLP revoked pledge of 1.41cr shares on May 16.
• Mercator promoter and director Harish Kumar Mittal and Archana Mittal invoked pledge of 10 lakh shares on May 14.
• Coffee Day Enterprises Promoter Coffee Day Solutions created pledge of 8.64 lakh shares from May 8-16.

Trading Tweaks

• Modern India price band revised to 2 percent.

Who’s Meeting Whom

• Dr Lal PathLabs to meet Securities Investment Management on May 21.
• Tata Chemicals to meet Laburnum Capital, Baron Capital and other investors from May 21-24.
• Voltas to meet Neuberger Berman on May 28.

Insider Trading

• MindTree: Larsen & Toubro acquired 74,000 shares on May 20.
• Trident promoter group Madhuraj Foundation acquired 2.64 lakh shares on May 17.
• Escorts promoter Har Parshad & Company acquired 2 lakh shares on May 16.

Money Market Update

• The rupee on Monday closed to its highest since March 18 at 69.74/$ versus Friday’s closing of 70.26/$.

F&O Cues

Futures –May Series

Nifty

• Nifty futures closed trading at 11,859, premium of 31 points versus 18 points.
• Nifty open interest up 7 percent, adds 10.5 lakh shares in open interest.

Bank Nifty

• Bank Nifty futures closed trading at 30,815.6, premium of 56 points versus 33 points.
• Bank Nifty open interest up 22 percent adds 2.7 lakh shares in open interest.

Options

• Nifty PCR at 1.28 Versus 1.36 (across all series).

Nifty Weekly Expiry 23 May

• Max open interest on call side at 12,000 (10.6 lakh shares).
• Max open interest at Put side at 11,500 (6.8 lakh shares).
• Max open interest addition seen at 11,500 Put (+5.5 lakh shares), 12,100 Call (+4.9 lakh shares).

Nifty Monthly Expiry 30 May

• Max open interest on call side at 12,000 (33 lakh shares).
• Max open interest on Put side at 11,000 (34.6 lakh shares).

Stocks In F&O Ban

• In Ban: Jet Airways
• New In Ban: Reliance Capital

On Bharat Forge

CLSA

• Maintained ‘Sell’ with a price target of Rs 420.
• Decent growth on a yearly basis but Ebitda missed in March quarter; revenue peaking sequentially.
• U.S. and Indian trucks on the cusp of a down cycle.
• Industrial exports should see growth moderation too.

UBS

• Maintained ‘Sell’ with a price target of Rs 480.
• March quarter was inline but growth slowdown ahead.
• Expect significant growth slowdown.
• Expect India, U.S. & EU truck volumes to decline into the next financial year.

On BPCL

CLSA

• Maintained ‘Sell’ with a price target of Rs 300.
• Weak core performance across segments.
• Strong marketing performance.
• Limited drivers of earnings surprise.

UBS

• Maintained ‘Buy’ with a price target of Rs 415.
• Weak performance in refining continues.
• Investors have been awaiting the turnaround of Kochi refinery.
• No LPG and Kerosene loss on OMCs is also positive.

On HPCL

CLSA

• Maintained ‘Sell’ with a price target of Rs 210.
• In-line refining but a miss on marketing.
• Notable jump in volumes along with market share gains.
• Limited earnings surprise drivers.

UBS

• Maintained ‘Buy’ with a price target of Rs 315.
• Marketing business hogs limelight in 2018-19 despite crude volatility.
• Debt increased due to due from government.
• Expect investor's to react positively.

On Tata Motors

CLSA

• Maintained ‘Sell’ with a price target of Rs 150.
• Ebtida miss for both the JLR and India business in March quarter.
• JLR outlook remains weak and see cyclical pressure in India.
• Cut FY20-21 EPS by 18-22 percent.

UBS

• Maintained ‘Neutral’ with a price target of Rs 200.
• March quarter review: JLR slightly ahead while India below expectations.
• JLR lacking a path to positive FCF.
• Net debt reduction largely seasonal; capex cuts help a little.

More Calls

CLSA on Torrent Pharma

• Maintained ‘Outperform’; cut price target to Rs 1,800 from Rs 2,100.
• March quarter results impacted by many adjustments still below estimates.
• U.S. sales under pressure in the medium term.
• India growth strong with focus on top brands.

Morgan Stanley on Dr Lal PathLabs

• Maintained ‘Underweight’; hiked price target to Rs 919 from Rs 810.
• Growth likely to be volume driven.
• Company to evaluate price hikes based on competitive intensity.
• Underweight due to limited pricing power, modest growth and rich valuation.

Citi on PI Industries

• Maintained ‘Buy’; hiked price target to Rs 1,303 from Rs 1,061.
• Strong exports growth continues.
• Domestic business was expectedly muted.
• PI continues to enjoy significant advantages with good revenue visibility.