Stocks To Watch: Jet Airways, Lupin, NMDC, PNB, Wipro, Yes Bank

Stocks and U.S. futures opened higher on Thursday in Asia after a broad rally in global equities amid an improvement in investor sentiment.

Shares in Japan, Australia and South Korea saw early gains. Hong Kong futures pointed to some claw-back of the 4 percent surge yesterday. The Singapore-traded SGX Nifty, an early indicator of NSE Nifty 50 Index’s performance in India, rose 0.33 percent to 10,893 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 in today’s trade.

• Lupin has agreed to develop and commercialise a drug to treat gastrointestinal and lung cancers with the German pharmaceutical firm Boehringer lngelheim GmbH for which it would be paid $70 million upfront.
• Wipro secured a strategic seven-year contract worth $300 million from ICICI Bank to provide digital services. These services were currently provided by Vara Infotech as part of the strategic engagement. Wipro will absorb about 3,800 employees of Vara lnfotech along with its existing contracts, facilities and assets, on a going concern basis, through a business transfer agreement for an all cash consideration of Rs 321 crore. It will provide these services to ICICI Bank from September onwards.
• NMDC August Production Update: Production fell 3 percent at 1.41 million tonnes versus 1.46 million tonnes . Sales also dropped 36 percent at 1.49 million tonnes versus 2.32 million tonnes.
• Power Grid Corporation declared successful bidder for Transmission work in Madhya Pradesh.
• Equitas Holdings: Equitas Small Finance Bank has sought Reserve Bank of India extension on listing of shares. As per the RBI previous regulations, Sept. 4 was the last day for listing for Equitas Small Finance Bank. The company also stated that the scheme had been filed with RBI and exchanges on Feb. 7. Stock exchanges have in turn forwarded the Scheme to Securities and Exchange Board of India and approval from SEBI is awaited as on date.
• UltraTech Cement: Kailash Chandra Jhanwar appointed as Managing Director of the company. He will replace Krishna Kishore Maheshwari from Jan. 1, 2020.
• Yes Bank and its compliance officer Shivanand Shettigar have settled a case, related to alleged disclosure lapses to the exchanges, with SEBI by paying a total amount of Rs 66 lakh towards settlement charges. (Bloomberg News)
• United Bank of India: Board will not discuss merger with Punjab National Bank on Sept. 6 meeting, to discuss the matter of merger at later date.
• Shankara Building Products: India Ratings and Research has downgraded the company’s Long-Term Issuer Rating to ‘IND A-’ from ‘IND A’, with outlook remaining stable.
• Jammu & Kashmir Bank has postponed its annual general meeting from Sept. 7 to Sept. 26.
• ONGC stated on the fire accident in Uran Processing Unit of the company that Offshore Crude supply has remained unaffected and impact of fire in local vicinity is ‘nil’. The Gas processing was restricted to maintain supplies to internal power generation and to meet the requirements of Mahanagar Gas and remaining gas quantities are diverted to the other processing unit of the Company at Hazira Plant.
• Engineers India has junked its plan to acquire Projects & Development India according to a person aware of the development. The person, on request of anonymity stated some conditions for the acquisition were not met. (Bloomberg News)
• Max India stated that the company and its three arms have filed for the amalgamation scheme with National Company Law Tribunal.
• MCX signed a memorandum of understanding with China’s Zhengzhou Commodity Exchange for cooperation and the exchange of information. Prithvi Haldea resigned from post of Public Interest Director with effect from Sept. 3.
• SREI Infra Finance signed co-operation agreement with Russia’s Quippo and Rosgeo, where all the parties intend to develop cooperation in the fields of land and marine geophysical work in both the countries.
• IFGL Refractories: CARE Ratings has reviewed the short term and long-term ratings worth Rs 167 crore to Issuer Not Cooperating Status.
• Elantas Beck: Company has submitted letter to Gujarat Pollution Control Board on Sept. 2 and it is continuing with production operations normally. On July 3 the Pollution Board issued a revocation order for company’s manufacturing plant in Gujarat.
• Elecon Engineering received arbitration award worth Rs 37.5 crore against BGR Energy as the order was passed by NCLT.

Moody’s Rating Action Post PSU Bank Merger Announcement

• Affirmed the local and foreign currency deposit ratings of Canara Bank, Oriental Bank of Commerce, Syndicate Bank and Union Bank at ‘Baa3/P-3’.
• Affirmed Baseline Credit Assessments and Adjusted BCAs at ‘ba3’ for Canara Bank, Oriental Bank of Commerce, Syndicate Bank and Union Bank.
• Affirmed the local and foreign currency deposit ratings of Punjab National Bank at ‘Ba1/NP’, and affirmed the bank's BCA and Adjusted BCA at ‘b1’.
• Outlook on Canara Bank, OBC, Syndicate Bank and Union Bank are maintained at stable.
• Changed outlook for Punjab National Bank to ‘Positive’ from ‘Stable’.

Trading Tweaks

• Anant Raj to move into short term ASM Framework.
• 63 Moons Technologies to move out of short term ASM Framework.
• Ramkrishna Forgings price band revised to 10 percent.
• Gallantt Ispat price band revised to 5 percent.

Who’s Meeting Whom

• Mahindra Lifepsace Developers to meet Grandeur Peak Advisors, Steward Investors and other investors from Sept. 6-13.
• Escorts to meet Matthews International Capital Management on Sept. 9.

Insider Trading

• Usha Martin promoter Rajeev Jhawar acquired 19.2 lakh shares on Sept. 3.
• Cadila Healthcare promoter group Zydus Family Trust acquired 2.5 lakh shares on Sept. 3.
• Vodafone Idea promoters acquired 25 lakh shares from Aug. 29-30.

Money Market Update

• The rupee closed at 72.12/$ versus 72.39/$ on Tuesday.

F&O Cues

September Futures

• Nifty September futures closed at 10,886, premium of 41.7 points versus 38.5 points.
• Nifty futures open interest down 3 percent, sheds 5.9 lakh shares in open interest.
• Bank Nifty September futures closed at 27,219, premium of 95 points versus 49 points.
• Bank Nifty futures open interest down 5 percent, sheds 80,000 shares in open interest.

Options

• Nifty PCR at 1.08 versus 1.03 (across all series).

Nifty Weekly Expiry: Sept. 5

• Max open interest on call side at 11,000 (30.5 lakh shares).
• Max open interest on put side at 10,800 (19.7 lakh shares).
• open interest addition seen at 10,700P (+6.3 lakh shares), 10,800C (+6.2 lakh shares), 10,800P (+5.5 lakh shares).

Nifty Monthly Expiry: Sept. 26

• Max open interest on call side at 11,500 (19.6 lakh shares).
• Max open interest on put side at 10,800 (29.5 lakh shares).

Brokerage Radar

Goldman Sachs on Bajaj Finance

• Upgraded to ‘Buy’ from ‘Neutral’; hiked price target to Rs 3,916 from Rs 3,830.
• Confidence on asset quality has improved.
• Loan growth would moderate, but remain higher than other banks.
• Will continue to deliver superior returns.

Macquarie on HDFC Bank

• Maintained ‘Outperform’ with a price target of Rs 2,735.
• Weakness in HDB Financial is temporary due to delay in payments by government.
• ALM profile is well matched.
• Capital sufficient for 12 months of growth but may look to raise earlier.

HSBC on Motherson Sumi

• Maintained ‘Buy’; cut price target to Rs 115 from Rs 170.
• Rapidly slowing domestic market and declining global car demand prompt us to lower earnings estimate.
• New greenfield plants suggest that revivals of these could significantly drive earnings growth.
• Retain buy due to 8 percent dividend yield in 2020-21.

Morgan Stanley on Lupin

• Maintained ‘Overweight’ with a price target of Rs 1,003.
• Announced out-licensing deal with Boehringher Ingelheim of novel oncology drugs.
• Lupin will receive an upfront payment of $20 million; potential additional clinical, regulatory and commercial milestone payment of $700 million + and double-digit royalties on sales.
• Expect 6-7 years to commercialise these assets assuming successful clinical/regulatory developments.

Kotak Securities on Infosys

• Maintained ‘Add’; hiked price target to Rs 850 from Rs 775.
• Management extremely confident on growth and margins.
• Comfortable with 21-23 percent EBIT margin without baking in recent rupee depreciation.
• Hiked price target to factor in recent currency rates.

Nomura on Lupin

• Maintained ‘Buy’; cut price target to Rs 913 from Rs 1,017.
• Delay in resolution of plant issues, slower than-expected ramp up in Solosec and delay in approval for gProAir are major disappointments in the U.S. market.
• Consistently grown ahead of the broader market and is likely to sustain the trend in India.
• Low expectations though make risk-reward favourable.

PhillipCapital on Agri Sector

• Agri‐inputs, though seasonal, is growing secularly.
• Fertilisers – DBT and balanced nutrient usage are game changers.
• Agrochemicals – a structural opportunity for the Indian industry.
• Leaders are best placed to gain from structural and policy changes.
• Coromandel International: Initiated ‘Buy’ with a price target of Rs 500
• Chambal Fertiliser: Initiated ‘Buy’ with a price target of Rs 200
• PI Industries: Initiated ‘Buy’ with a price target of Rs 1350
• UPL: Initiated ‘Buy’ with a price target of Rs 730

Emkay on BHEL

• Upgraded to ‘Buy’ from ‘Hold’; cut price target to Rs 62 from Rs 80.
• Favorable risk-reward despite uncertainty on power capex revival.
• Cut EPS estimates by 70 percent and 45 percent respectively for the current and the next financial year due to near-term execution concerns.