Stocks To Watch: Dilip Buildcon, Maruti Suzuki, M&M, Hero MotoCorp, Tata Steel
Asian stocks began the week on the back foot in the wake of trade-war jitters from U.S. moves against Mexico and India to China’s retaliation against American measures.
U.S. futures retreated and equities in Tokyo slumped, with losses more modest in Korea and Australia. The Singapore-traded SGX Nifty, an early indicator of NSE Nifty 50 Index’s performance in India, rose 0.25 percent to 11,955 as of 6:45 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
- NCLT approved resolution plan submitted by Tata Steel for acquiring the controlling stake of Bhushan Energy under IBC.
- Castrol India said that it has joined hands with 3M India to bring a range of vehicle care products for the automotive after-market. The partners will bring in a range of 3M-Castrol branded bike and car care products like shampoo, glass cleaner, cream wax, dashboard and tyre dressers. (Press Trust of India)
- Kwality: Auditors gave qualified opinion that the state current financial conditions may indicate the existence may indicate a material uncertainty on Company's ability to continue as going concern and therefore the Company may be unable to realise its assets and discharge its liabilities in the normal course of business.
- Ceat signed a power purchase agreement with Greenzest, by setting up a captice solar plant in Maharashtra. Company has agreed to acquires a maximum of 26 percent stake in the company amounting to Rs 5 crore.
- Vedanta has urged Zambian Government to resolve dispute in talk and Konkola Mine has suspended operations: CEO Venkatakrishnan (Bloomberg News).
- Biocon fixed June 13 as record date for issue of bonus shares.
- Seamec: Virendra Kumar Gupta resigned from post of President and CFO, due to personal reasons.
- NTPC commissioned Unit-1 off 800 MW of Gadarwara Super Thermal Power Station.
- Dilip Buildcon said that the company has executed EPC agreement with NHAI for highway project in Maharashtra valued at Rs 480.06 crore.
- Great Eastern Shipping to buyback 32.67 lakh equity shares at a price of Rs 306 piece, a premium of 9 percent from Friday’s close.
- Aviation stocks will be in focus as Indian oil cut ATF prices for the first time in last five month. The oil marketer cut prices by 0.3 percent from the last month to Rs 66,611 per kilo litre for June 2019.
- Coal India: Production in the month of May drops 1.1 percent to 46.59 million tonne. Sales in the month of May drops 1.4 percent to 52.09 million tonne.
- NCLT has sanctioned the merger of Indus Towers and Bharti Infratel. Bharti Airtel, Bharti Infratel and Vodafone Idea will be in focus.
- MOIL: Company reduced prices of Ferro Grade, SMGR (Mn30 percent and Mn25 percent), Fines and Chemical Grades of Ore by about 7.5 percent.
- NBCC (India): Company received a total business of Rs 25 crore in May 2019.
- Future Lifestyle Fashion invested additional Rs 32.43 crore in fashion e-commerce company Koovs PLC.
- Gujarat Alkalies said that it has commissioned 7.5 MW out of the 20 MW solar power plant at Charanka on May 31.
- Srikalahasthi Pipes resumed operations at one of its plants after planned maintenance shutdown.
- Goejit Financial Services said that the company withdrew the application with SEBI for registration of mutual fund business.
May Auto Sales Update (YoY)
- Maruti Suzuki: Total Sales down 22 percent to 1.34 lakh units.
- M&M: Tractor sales slump 16 percent. Auto sales down 3 percent.
- Escorts: Total tractor sales down 18 percent to 6,827 units.
- Eicher Motors: VECV sales down 19.7 percent. Royal Enfield sales slump17 percent.
- SML Isuzu: Truck and bus sales up 17.1 percent to 1,689 units.
- Atul Auto: Total sales down 13 percent to 3,464 units.
- Hero MotoCorp sales fell 7.7 percent to 6.52 lakh units.
Catch all the live updates on how Indian automakers fared in the month of May here.
Earnings Reaction To Watch
Kwality (Q4, YoY)
- Revenue down 93.3 percent to Rss 113.7 crore.
- Net loss of Rs 497.2 crore versus net profit of Rs 1.1 crore.
- Ebitda loss of Rs 450.7 crore versus Ebitda profit at Rs 136.8 crore.
- Other Expenses of Rs 452.3 crore in the current quarter due to provisions for doubtful debtors and write off for assets.
Indian Terrain Fashions
- Caam Funds India acquired 4.09 lakh shares or 1.08 percent equity at Rs 111.85 each.
- Amundi Funds Equity India sold 4.09 lakh shares or 1.08 percent equity at Rs 111.85 each.
Pledge Share Details
- Max Financial Services promoter group Max Ventures Investment Holdings revoked pledge of 4 lakh shares and pledged 1 lakh shares from May 28-29.
Who’s Meeting Whom
- Tata Chemicals to meet HDFC AMC on June 3.
- Somany Ceramics promoter Anushree Chopra sold 28,000 shares on May 30
- ADF Foods promoters acquired 3.61lakh shares from May 29-30
- Eveready Industries to move into ASM Framework
- Pricol , Tata Teleservices (Maharashtra) to move into short term ASM Framework
- UFO Movies to move out of short term ASM Framework
- Kridhan Infra price band revised to 10 percent
- Manpasand Beverages price band revised to 5 percent
Money Market Update
The Indian rupee resumed weekly declines. The home currency depreciated 0.25 percent against the dollar to end at 69.69 against the greenback.
- Nifty June 27 Futures at 11916, premium of 6 points
- Nifty June 27 Bank futures at 31325, discount of 50 points
- India VIX up 2.9 percent to 16.06
- Max OI in Jun 27, 11500 Call – 23.3 lakh shares
- Max OI in Jun 27, 12000 Call – 14.3 lakh shares
- Nifty Put Call Ratio at 1.18 versus 1.3.
CLSA on Sadbhav Infra
- Maintained ‘Buy’; cut price target to Rs 320 from Rs 340.
- Lofty backlog starts execution but slowly in a tough environment.
- State Capex helps orders and big execution ramp-up ahead.
- Cut FY19-21 EPS estimates given delay in financing and land acquisitions by NHAI, pushing-out execution by six months and a higher tax rate.
CLSA on NCC
- Maintained ‘Buy’; Cut price target to Rs 138 from Rs 145.
- Buy as the correction is excessive due to stringent move by new Andhra Pradesh government.
- NCC has Rs 610 crore in orders from Andhra Pradesh and had not yet started execution.
- Factoring-in a worst case scenario, still see a lofty and more balanced order backlog.
CLSA on Bharti Airtel
- Maintained ‘Buy’; hiked price target to Rs 425 from Rs 376.
- Indian mobile surprises positively on subscribers, usage, ARPU and margin.
- Bharti continues to see strong traction in 4G subscriber additions.
- Bharti’s upcoming African IPO will lower Bharti’s leverage further.
CLSA on J.Kumar Infra
- Maintained ‘Buy’ with a price target of Rs 315.
- Fiscal Review: Mumbai metro lines drive execution.
- Expect EPS CAGR of 18 percent over FY19-22.
- Inexpensive play on high-growth urbanisation capex.
CLSA on Jagran Prakashan
- Maintained ‘Buy’; hiked price target to Rs 145 from Rs 135.
- See double-digit print ad revenue growth & newsprint cost relief ahead.
- Management expects fall in newsprint prices to boost margins from July.
- Hike ad revenue estimates by 3 percent and cut raw-material cost estimates by 7-10 percent for FY20-21.
HSBC on Apollo Hospitals
- Maintained ‘Buy’; hiked price target to Rs 1,525 from Rs 1,500.
- Good show continued on scale-up of new hospitals and volume growth in mature hospitals.
- Apollo continues to focus on improving case mix through advance medical offerings.
- Losses continue to reduce, turnaround expected in the second quarter of the current financial year.
HDFC Securities on Gujarat Gas
- Initiated ‘Buy’ with a price target of Rs 222.
- Company well positioned given low LNG prices and development of CGD ecosystem across Gujarat.
- Expect robust volume growth of 11 percent CAGR over FY19-24 eatimates led by industrials and CNG segments.
- Expect company to reach net cash position on the back of rise in volumes and expansion in new areas.
Macquarie on India Financials
- Vehicle loan growth has been weak due to structural and cyclical factors.
- Top players in life and general insurance space are losing market share to newer players.
- Stay away from NBFCs and PSU banks, stick with private sector banks and life insurance.
On India GDP
- Slowdown reflects a combination of global weakness and continued drags from domestic economy.
- Expect slowdown to continue in the second quarter; slow recovery to start from the third quarter.
- Expect RBI to deliver its third rate cut of 25 basis points while retaining a ‘neutral’ stance.
- Expect RBI to state explicitly that it will keep banking system liquidity marginally positive.
- Weaker private sector activity dragged growth offsetting the rise in government spending.
- Slowdown was evident across agriculture, industry, investment and exports.
- Growth likely to remain weak in next quarter, before improving in the second half of this year.
- RBI is expected to cut rates by 25 basis points at the upcoming June meeting.