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The Baseline
11 Apr 2023
Five analyst picks this week
By Suhas Reddy
  1. Motilal Oswal Financial Services: ICICI Securities reiterates its ‘Buy’ call on this financial services company with a target price of Rs 620. This indicates an upside of 39%. Analysts Ansuman Deb, Ravin Kurwa and Vishal Singh say, “Motilal Oswal’s valuations have become attractive considering it is trading at five times FY24 core P/E multiple, which excludes investment income and the investment book.” 

According to the analysts, Motilal Oswal has seen consistent growth and market share gain in futures and options volumes, and active clients during the past three quarters. The company is also expanding its sales team to drive growth in the housing finance segment, which the analysts believe would yield results in FY24/FY25.

The analysts add that the company’s efforts to improve its broking volume share and AMC performance, increase wealth management AUM, and grow the housing finance portfolio could benefit earnings. 

  1. Star Health and Allied Insurance: HDFC Securities maintains its ‘Buy’ rating on this insurance company with a target price of Rs 795, indicating an upside of 34.8%. Analysts Sahej Mittal and Krishnan ASV see the recent price hike in the company’s flagship product (STARHEAL) as a key positive, believing it will increase profitability in the coming quarters. They add, “We like STARHEAL for its strong moats, including a dominant agency-led distribution network, retail business mix, and best-in-class operating expense ratios.”

Despite their optimism about the price hike, the analysts expect it to hit sales in the short term. However, given a favourable base, along with the price hike in the flagship product, they expect the company’s net premium to grow over FY24 by more than 20% YoY. Mittal and Krishnan estimate the firm’s net profit to grow at a CAGR of 26.1% over FY23-25.  

  1. Tata Motors: Motilal Oswal maintains its ‘Buy’ rating on this automobile maker with a target price of Rs 525, implying an upside of 14.6%. Analysts Jinesh Gandhi, Amber Shukla and Aniket Desai are upbeat about the company’s prospects due to JLR’s (Jaguar-Land Rover) wholesales exceeding estimates in Q4FY23. Wholesale volumes have risen 24% YoY to 94,600 units (the brokerage estimate was 84,500 units), driven by a 34% YoY increase in Land Rover’s wholesales. Meanwhile, Jaguar’s wholesales fell 27% YoY. 

They also find the 30% YoY growth in JLR’s retail sales in Q4 to be encouraging. They add,” Retails were higher in all the markets, with strong growth in EU (+46% YoY), UK (+42% YoY), rest of the world (+30% YoY), China (+29% YoY) and the US (+12% YoY).” 

Overall, the analysts believe that all of the company’s business segments are in the midst of recovery, but expect supply-side constraints to impact its pace. They see the firm’s domestic, commercial and passenger vehicle businesses driving growth in the medium term. Gandhi, Shukla and Desai expect the company’s revenue to grow at a CAGR of 13.8% over FY23-25. 

  1. Hindalco Industries: ICICI Direct maintains its ‘Buy’ call on this aluminium company but reduces its target price to Rs 465, indicating an upside of 12.3%. According to analyst Dewang Sanghav, who attended Hindalco’s Investor Day events, “Novelis (an arm of Hindalco) aims to achieve long-term sustainable EBITDA/tonne of $525/tonne by Q4FY24.” He also mentions that the company has indicated reduced spending on growth capex for Novelis and Indian operations. Of the $8 billion capex announced a year ago, the company prioritises $4.4 billion capex for projects that are already under construction. The rest of the projects have been deferred but not cancelled.

Sanghav assumes that Novelis will report an EBITDA of $475/tonne for FY23 and FY24 each. For FY24, he has revised Novelis’s EBITDA/tonne estimate downward to $475/tonne. Going forward, he expects Hindalco to report a consolidated EBITDA margin of 11.3% for FY23 and 11.2% for FY24. 

  1. Godrej Consumer Products: Sharekhan maintains its ‘Buy’ rating on this FMCG company with a target price of Rs 1,100. This implies an upside of 14.8%. Analysts remain optimistic about the company’s growth prospects after reviewing its Q4FY23 pre-quarter update. They are upbeat about the firm’s improved performance and expect its revenue to grow by double digits. They add, “Q4FY23 will be the first quarter of double-digit revenue growth (with volume growth of 4-5%) after six quarters of single-digit growth.” The analysts attribute this growth to healthy domestic business and recovery in its Indonesia business. They expect the firm’s operating and gross margins to improve YoY due to lower input costs.

The analysts at Sharekhan also note the management’s efforts to improve margins through operational efficiencies and premiumisation. They expect the firm’s revenue to grow at a CAGR of 11.1% over FY22-25. 

Note: These recommendations are from various analysts and are not recommendations by Trendlyne.

(You can find all analyst picks here)

 
Trendlyne Marketwatch
Trendlyne Marketwatch
10 Apr 2023
Market closes flat, Yes Securities upgrades Paytm's target price to Rs 700

Trendlyne Analysis

Nifty 50 closed at 17,624.05 (24.9, 0.1%), BSE Sensex closed at 59,846.51 (13.5, 0.0%) while the broader Nifty 500 closed at 14,790.55 (31.4, 0.2%). Of the 1,978 stocks traded today, 1,001 showed gains, and 938 showed losses.

Indian indices pared the gains made in the morning session and closed flat. The Nifty 50 closed above the 17,600 mark. India volatility index, India VIX, rose above 12. 

Nifty Smallcap 100 and Nifty Midcap 100 closed in the green, outperforming the benchmark index. Nifty Auto and Nifty Realty closed sharply higher than Thursday’s levels. Nifty IT also closed sharply higher, tailing tech-heavy Nasdaq 100, which closed 0.74% higher on Friday. Larsen & Toubro's arm L&T Energy Hydrocarbon won an order worth Rs 1,000-2,500 crore from Chambal Fertilisers and Chemicals. 

European stocks traded higher, in line with most major Asian indices closing in the green. US indices futures also traded higher after closing in the green on Friday. Brent crude oil futures traded marginally higher, as tighter supplies are expected from OPEC+ oil producers starting in May.

  • Tata Motors sees a Long buildup in its April 27 future series as its open interest rises 14.7% with a put-call ratio of 0.72.

  • FMCG stocks like Tata Consumer Products, Zydus Wellness, Hindustan Unilever and Nestle India are falling in trade as the Indian weather forecasting services company Skymet predicts below-normal monsoon in 2023.

  • Reports suggest that Torrent Power has emerged as the lowest bidder for a contract to supply 1,100 MW of gas-based power. The company quoted Rs 13.7 per unit for the supply of 770 MW each for 45 days in April and May from two of its gas-based projects in Gujarat.

  • Yes Securities upgrades One97 Communications’ (Paytm) target price to Rs 700 from Rs 600, while maintaining its ‘Neutral’ stance on the stock. The decision comes after the company’s Q4 updates revealed an increase in loan disbursements and new merchant device additions. The brokerage expects revenue to grow by 18% QoQ, an upward revision of 12% from previous estimates.

  • EID Parry (India)'s board approves the payment of the second interim dividend for FY23 at Rs 4 per share. The record date for the payment is set as April 21, 2023. The stock shows up in a screener for companies with ROA improving over the past two years.

  • One97 Communications (Paytm) is rising as reports suggest that 20.46 lakh shares (0.34% equity) of the company, amounting to Rs 133.92 crore, change hands.

  • Schaeffler India and ICICI Securities rise 9.5% and 9.3% respectively over the past week, ahead of their results on April 18 and April 19.

  • GAIL India is rising as it reduces the price of LNG by Rs 7 per standard cubic meter (SCM) in Bengaluru and Dakshin Kannada and Rs 6 per SCM in other areas. It has also slashed CNG prices by Rs 7 per kg in Karnataka and Rs 6 per kg in other areas.

  • Venugopal Garre, Managing Director and Senior Analyst at Sanford C Bernstein, says India is currently facing a bear market rally. He adds that emerging markets have been underperforming so far.

  • Future Retail is rising as the company receives expressions of interest from 49 companies. Reliance Retail, WH Smith, JC Flowers and Jindal Power are among the companies that have expressed interest in buying the firm.

  • Larsen & Toubro's arm L&T Energy Hydrocarbon wins an order worth Rs 1,000-2,500 crore from Chambal Fertilisers and Chemicals for the license plus engineering, procurement and construction of a technical ammonium nitrate plant and weak nitric acid plant at Gadepan, Kota, Rajasthan.

  • Motilal Oswal initiates coverage on Max Healthcare Institute with a ‘Buy’ rating and a target price of Rs 530, implying an upside of 18.3%. The brokerage believes that the company is well-placed to benefit from demand tailwinds in the diagnostics industry, given its strategic locations in metro cities and strong execution capabilities.

  • Goldman Sachs upgrades Bandhan Bank’s rating to ‘Buy’ from ‘Neutral’ as it finds the stock's valuations attractive. The brokerage expects RoA and RoE to increase over FY24-25 as its microfinance portfolio sees an improvement in collections. The stock rises 10% over the past week.

  • Sobha is rising as its sales in Q4FY23 rise 25.7% YoY to Rs 1,463.4 crore, its highest ever. Its average price realisation per square foot also grows 13.7% YoY to Rs 9,898. The company achieves its highest annual sales in FY23, with a 34.3% YoY increase. The stock shows up in a screener for companies with improving cash flow from operations over the past two years.

  • Akshay D’Souza, Chief of Growth & Insights at Bizom, expects strong growth for FMCG companies in Q4FY23. He adds that the heat wave in February has led to improved sales of summer products.

  • Mahindra & Mahindra Financial Services is declining as RBI imposes a fine of Rs 6.77 crore on the firm for non-compliance with its directions relating to annualised interest rates. The company charged a higher interest rate than what was communicated to its borrowers during FY19, FY20, and FY21, and also failed to give notice of change in terms to its borrowers.

  • Godrej Properties rises as its booking value goes up 56% YoY to Rs 12,232 crore in FY23. Its cash collections have also grown 52% YoY in Q4. It shows up in a screener of stocks with improving book value over the past two years.

  • Birla Estates, an arm of Aditya Birla Group and housed under Century Textiles and Industries, enters the Pune residential market by acquiring a 5.76-acre land parcel from Sudarshan Chemical Industries. The land has a revenue potential of Rs 2,500 crore.

  • Indian rupee appreciates 24 paise to 81.78 against the US dollar in early trade today. The rise is on the back of a positive trend in domestic equities and foreign fund inflows.

  • Realty stocks like Godrej Properties, Prestige Estates Projects, Sobha and DLF are rising in trade. Broader sectoral indices Nifty Realty and BSE Realty are also trading in the green.

  • Goldman Sachs downgrades its rating on Maruti Suzuki India to ‘Neutral’ and lowers the target price to Rs 8,800. The brokerage says the slowdown in the small car market will likely offset any potential market share gains for Maruti in FY24.

  • Dolly Khanna cuts her stake in Rama Phosphates in Q4FY23. She now holds below 1%, down from her 1.5% stake in Q3FY23.

  • Vijay Kedia buys a 0.1% stake in Heritage Foods in Q4FY23. He now holds a 1.2% stake in the company.

  • Rail Vikas Nigam (RVNL), in partnership with Siemens India, secures a contract worth Rs 378 crore for the turnkey solution of the Mumbai Metro Line 2B project. Siemens India will be the lead partner with a 60% share, while RVNL will hold 40%.

  • CreditAccess Grameen Bank is up more than 6% in trade after reporting a 27% YoY growth in assets under management to Rs 21,032 crore in Q4FY23. The bank also reports an 80% YoY increase in customer additions during the same period. The stock ranks medium on the Trendlyne checklist score.

  • Titan is rising as its revenue increases 25% YoY in Q4FY23 aided by the watches & wearables segment and emerging businesses. Its Indian dress-wear brand, Taneira, has also achieved sales growth of 208% YoY. Additionally, Titan's jewellery segment has seen revenue growth of 23% YoY. It shows up in a screener of stocks with increasing profits in the past three quarters.

  • Tata Motors reports 8% YoY rise in global wholesales to 3.6 lakh units in Q4FY23 despite increased interest rates and reduced purchasing power due to high inflation. Jaguar Land-rover, its subsidiary, has contributed nearly one-third to the global wholesales. Global passenger vehicle and electric vehicle wholesales also rise 10% YoY in Q4.

Riding High:

Largecap and midcap gainers today include Godrej Properties Ltd. (1,228.35, 9.15%), DLF Ltd. (405.50, 5.90%) and Power Finance Corporation Ltd. (166.40, 5.75%).

Downers:

Largecap and midcap losers today include Petronet LNG Ltd. (228.50, -3.10%), 3M India Ltd. (22,780.45, -2.35%) and Havells India Ltd. (1,169.75, -2.08%).

Crowd Puller Stocks

20 stocks in BSE 500 are trading on high volumes today.

Top high volume gainers on BSE included Rossari Biotech Ltd. (740.95, 18.39%), Godrej Properties Ltd. (1,228.35, 9.15%) and Chemplast Sanmar Ltd. (403.05, 7.34%).

Top high volume losers on BSE were Tata Teleservices (Maharashtra) Ltd. (60.95, -4.99%), Sapphire Foods India Ltd. (1,194.45, -1.69%) and Galaxy Surfactants Ltd. (2,377.00, -1.62%).

Torrent Power Ltd. (520.00, -0.26%) was trading at 19.2 times of weekly average. Godrej Industries Ltd. (442.35, 4.34%) and Tata Motors Ltd. (461.30, 5.40%) were trading with volumes 7.9 and 5.4 times weekly average respectively on BSE at the time of posting this article.

BSE 500: highs, lows and moving averages

15 stocks made 52-week highs, while 3 stocks hit their 52-week lows.

Stocks touching their year highs included - Abbott India Ltd. (22,880.00, -0.00%), Zydus Lifesciences Ltd. (496.50, 0.48%) and Cholamandalam Investment & Finance Company Ltd. (829.20, -1.45%).

Stocks making new 52 weeks lows included - United Breweries Ltd. (1,398.00, -0.64%) and V-Mart Retail Ltd. (2,098.00, -0.60%).

13 stocks climbed above their 200 day SMA including Prestige Estates Projects Ltd. (445.75, 6.27%) and DLF Ltd. (405.50, 5.90%). 7 stocks slipped below their 200 SMA including 3M India Ltd. (22,780.45, -2.35%) and 360 One Wam Ltd. (432.20, -1.73%).

 
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The Baseline
10 Apr 2023
Chart of the week: India’s Manufacturing PMI on the rise as other economies slow down
By Abdullah Shah

The Manufacturing Purchasing Managers' Index (PMI) is a key economic indicator, which measures the health of the country’s manufacturing sector. PMI readings above 50 signal expansion (growth), while those below 50 indicate contraction. In this edition of chart of the week, we will compare the Manufacturing PMI for India to that of  other industrially prominent countries around the world.

India's manufacturing PMI was strong a year ago in March 2022 with a reading of 54, and remained steady for Q1FY23, clocking in at 53.9 in June 2022. More recently, the PMI has been rising and reached a three-month high of 56.4 in March 2023. The increase was fueled by a capex push from the government in the FY24 budget, as well as the need to achieve the FY23 budget capex goal. 

In the past two months, China's manufacturing PMI has been around the 50 mark, scoring 51.6 and 50 in February and March 2023, respectively. This indicates a marginal expansion in the sector after the easing of lockdown measures. China’s index had a steep rise at the beginning of FY23 but started a downward slope from July 2022 as lockdown restrictions hit the manufacturing sector. 

The US PMI was the highest among the five countries a year ago, at 57.1 in March 2022, indicating strong manufacturing activity. However, the index has been on a steady decline since then as the US Fed raised interest rates, and fell below the 50 mark to 46.3 in March 2023. A survey conducted by the Institute for Supply Management (ISM) revealed that all the components of the US PMI were below the 50 mark for the first time since 2008. Analysts suggest that the PMI will continue to fall due to the ever-rising repo rates.

The United Kingdom's manufacturing PMI was recorded at 55.2 in March 2022 but dropped to 52.8 in June 2022. Although the index rose  for two consecutive months at the beginning of 2023, it declined to 47.9 in March 2023 on the back of reduced demand and manufacturers’ tendency to maintain lower inventory levels.

Finally, Germany's manufacturing PMI was strong in March 2022 with a reading of 56.9, but it slightly dipped to 54.6 in April. However, the index has continued to fall and hit its lowest level of 44.7 in March 2023.

The PMI is a crucial instrument to assess the health of the manufacturing sector, and India's manufacturing PMI has been steadily rising in recent months. China's manufacturing PMI also expanded after the lifting of lockdown restrictions, while the US and UK saw declines. Germany's PMI has continued its worrying decline, indicating a sharp slowdown in the country's manufacturing sector. Overall, PMI readings for these countries are a useful recession signal and offer valuable insights into the condition of their economies.

It remains to be seen how these trends will unfold over the coming months. For now, India is in a relatively strong position.

 
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The Baseline
06 Apr 2023
Five Interesting Stocks Today
  1. Mahindra & Mahindra Financial Services: This NBFC has risen 5.7% over the past week after posting strong numbers in its business update for Q4FY23 and FY23. This helped the company show up in a screener of stocks with high volume and high gain.

In Q4FY23, the company’s loan disbursements rose by 50% YoY to Rs 13,750 crore, while FY23 overall saw a jump of 80% YoY Trendlyne’s forecaster estimates the company’s revenue and EPS to grow by 9.6% and 46.5% respectively in FY23.

The firm’s continued momentum in loan disbursements, improving asset quality and strong collection efficiency are the key drivers for its growth. According to Motilal Oswal, various strategic initiatives like changes in top-level management and improving loan recollection processes have the potential to yield a strong operational performance if executed well. The brokerage maintains its ‘Buy’ rating on the stock, with a target price of Rs 285 per share, indicating a potential upside of 22.8%. It also estimates the lender’s assets under management (AUM) to grow at a CAGR of 18% over FY23-25.

Recently, the company reached a 52-week high of Rs 272 on February 10, putting it in a screener of stocks with high momentum scores. The stock is currently trading 49.1% higher than its 52-week low of Rs 160.6 per share.

  1. Bajaj Auto: This auto stock's two-wheeler domestic wholesales have risen 42% YoY to 1.5 lakh units in March, while commercial vehicles (CV) saw a surge in domestic wholesales by 74%. However, exports in both segments fell by more than 30%, resulting in a 2% YoY decline in total wholesales (both two-wheeler and CV).
    Recently Bajaj Auto also announced production cuts due to a weak export market, with expectations of a recovery only by Q2FY24. Despite this, the stock has gone up by nearly 12% in the past three months.

According to ICRA, the commercial vehicles segment is likely to see a growth of 7-10% in FY24. The demand in segments like passenger vehicles, commercial vehicles and tractors will remain healthy and intact, which bodes well for Bajaj Auto, despite a decline in exports.

On a positive note, Bajaj Auto is set to enter the electric vehicles segment in both the cargo and passenger vehicle markets. In fact, the company is preparing to launch its three-wheeler electric vehicle in April. With a 76% market share in three-wheelers, Bajaj Auto would compete with Mahindra & Mahindra, which currently leads the market in the three-wheeler electric segment.

In the past week, the stock has risen 5.6% and is currently trading near its 52-week high. It shows up in a screener of stocks with high momentum scores. According to Trendlyne’s Forecaster, the consensus for the stock from 23 analysts is ‘Buy’. The company is set to announce its Q4FY23 results on April 25.

  1. Maruti Suzuki: This automobile manufacturer rose 2.5% on Monday despite reporting a marginal decline of 0.2% YoY in its total domestic sales to 1.7 lakh units in March. The rise in share price is possibly due to the company hiking prices for all its models for a second time in 2023, to partially offset the impact of inflationary pressures and regulatory requirements.

Although Maruti Suzuki saw a fall in domestic sales, its exports increased 14% YoY in March. The company has shipped over 25 lakh units overseas since it started exports. The automaker exports to nearly 100 countries, including Africa, the Middle East, Latin America and Asia. However, the company’s management has pointed out that a shortage of electronic components affected production volumes in FY23, and expects the problem to persist in FY24. Despite this, the auto giant reported its highest-ever wholesales of 19.7 lakh units, up by 19% YoY, in FY23.

Analysts have a positive outlook on the company as they believe it is focused on expanding its presence in the SUV segment to drive revenue growth. According to Trendlyne’s Forecaster, the consensus recommendation for the stock from 41 analysts is ‘Buy’. The company features in a screener of stocks where brokers have upgraded their recommendations or target prices in the past three months.

  1. Godrej Consumer Products: This FMCG company released its Q4FY23 business update on Wednesday, forecasting healthy double-digit volume growth in its India business. The firm’s volume growth in Q3 in comparison, was only 3% YoY. Domestic business contributes over 55% of the company’s consolidated revenue. The management expects broad-based growth in Q4, led by the home care and personal care segments.

The company introduced value products at lower price points across its product portfolios like household insecticides and personal care, amid a sluggish environment in the FMCG sector due to muted rural demand.  This has aided higher market penetration in India, improving the company's volumes. According to reports, the company has gained market share in the hair colour segment after introducing products starting from Rs 15.

The stock has grown 5.8% over the past 90 days till Wednesday, outperforming the FMCG sector by 8.3 percentage points. The stock shows up in a screener for companies with improving cash flows and high durability scores.

Motilal Oswal expects the company to benefit significantly from the recent decline in palm oil prices, which could result in improved profitability in the coming quarters. The management also echoes this sentiment, as it believes that the decrease in input costs will allow it to raise marketing investments in the near to midterm.

  1. HDFC Bank: This bank rose 2.6% in trade on Wednesday following the release of its business update on Monday after market hours. The company reported that its advances grew 17% YoY to 16 lakh crore in Q4FY23. The growth was led by retail, commercial & rural loans, which rose by more than 20%. Corporate and other wholesale loans grew by 12.5% in Q4.

The bank’s deposits also rose 21% YoY to Rs 18.8 lakh crore, led by a 23.5% increase in retail deposits. This is higher than the industry growth rate of 10%, according to reports. Analysts suggest that HDFC Bank’s market share in deposits at the end of FY23 would stand at 20%, up from 19% as of 9MFY23, which is positive news for the bank.

The bank also purchased loans worth Rs 9,340 crore in Q4, through a direct assignment route under the home loan arrangement with HDFC. This is a lower-cost route of obtaining funds for the bank. It remains to be seen how the bank’s low cost of funds and high advances growth will impact its margins.

The stock is up 5.5% in the past week, ahead of its Q4FY23 results on April 15. It has also outperformed its sector by 9.8% in the past 90 days. However, Trendlyne’s Forecaster estimates a 0.9% fall in net profit estimates in Q4FY23. 

Trendlyne's analysts identify stocks that are seeing interesting price movements, analyst calls, or new developments. These are not buy recommendations.

 
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The Baseline
06 Apr 2023
Screener of the week: Finance sector stocks with high momentum and positive forecaster estimates for Q4FY23
By Abdullah Shah

While brokerages are getting squeezed, the overall finance sector is a different story - with multiple stocks analysts are bullish on.

This screener shows stocks from the banking and finance sector with momentum scores greater than 50, and a strong Q4FY23 result outlook - where estimates for quarterly YoY revenue growth are higher than 10%, and estimates for quarterly net profit growth are more than the previous quarter.

The screener is dominated by stocks from the banking industry with 12 bank stocks. Major stocks in the screener are Shriram Finance, Karur Vysya Bank, Federal Bank, IDFC First Bank, ICICI Bank and Bank of Baroda.

Shriram Finance has the highest YoY revenue growth estimates of 71.3% for Q4FY23, according to Trendlyne’s forecaster. The NBFC has a Trendlyne momentum score of 52.7. Over the past quarter, the lender has fallen 4.7%, but has outperformed its industry by 320 bps.

ICICI Bank has a revenue growth estimate of 29.5% YoY from forecaster for Q4FY23. The bank has a Trendlyne momentum score of 53.4 and has outperformed the banking industry by 5.8 percentage points. 

You can find more screeners here.

 
Trendlyne Marketwatch
Trendlyne Marketwatch
06 Apr 2023
Market closes higher, Avalon Tech’s IPO bid for 2.2X the total shares on offer

Trendlyne Analysis

Nifty 50 closed at 17,599.15 (42.1, 0.2%), BSE Sensex closed at 59,832.97 (143.7, 0.2%) while the broader Nifty 500 closed at 14,759.20 (49.8, 0.3%). Of the 1,967 stocks traded today, 1,294 were on the uptick, and 635 were down.

Indian indices closed in the green, with the Nifty 50 closing just below the 17,600 mark. Markets rose after RBI's six-member Monetary Policy Committee unanimously voted to keep the repurchase rate at 6.5%, in a surprise move. RBI projected India’s FY24 GDP growth at 6.5%. Additionally, the forecast for inflation for the year was lowered from 5.3% to 5.2%. 

Nifty Smallcap 100 and Nifty Midcap 100 closed in the green, outperforming the benchmark index. Nifty FMCG and Nifty Energy closed higher than Tuesday’s levels. Dabur India closed over 4% lower after its management stated that its Q4FY23 revenue will see a mid-single-digit growth rate. 

European stocks traded higher despite most major Asian indices closing in the red. US indices futures trade lower after closing mixed on Wednesday. Brent crude oil futures traded marginally lower as investors look ahead to key US economic data releases on Friday.

  • Avalon Technologies’ Rs 865 crore IPO gets bids for 2.2X the available 1.14 crore shares on offer on the last day of bidding. The retail investor quota gets bids for 84% of the available 20.8 lakh shares on offer.

  • TrentbeatsShoppers Stop in YoY and QoQ revenue growth, price-to-book value, FII holdings and Piotroski score. But it lags in QoQ net profit growth, PE ratio, one-year returns and broker average target upside.

  • Ashoka Buildcon is rising as it bags an order from Maharashtra State Electricity Distribution Company. The Rs 2,285 crore deal is for the development of distribution infrastructure. The stock shows up in a screener with strong annual EPS growth.

  • Mazagon Dock Shipbuilders' turnover rises 32% YoY to Rs 7,547 crore in FY23. It shows up in a screener of stocks with the highest recovery from their 52-week lows. ICICI Direct maintains its ‘Hold’ rating on the stock with a target price of Rs 745.

  • Cholamandalam Investment & Finance hits an all-time high of Rs 847.5 after reporting a 64% rise in loan disbursements in Q4FY23 to Rs 21,020 crore. The growth is driven by an increase in disbursements in the home loan and MSME segments.

  • Angel One is rising as its client base grows 49.5% YoY to 1.37 crore in March. Additionallly, the number of orders increases 26.8% YoY, while the firm’s average daily turnover jumps up 135.5% YoY. The stock shows up in a screener for companies with high TTM EPS growth.

  • Kalyan Jewellers India's revenue grows 17% YoY in Q4FY23 and 29% YoY in FY23. The company has added 11 new 'Kalyan' showrooms across non-south markets during Q4, taking the total to 147.

  • Dabur India is falling as it expects mid-single-digit growth in its consolidated revenue for Q4FY23. Despite a slight improvement in demand in both urban and rural segments, it has not made a full recovery. The company also expects its gross margin to be impacted due to currency headwinds.

  • Zydus Lifesciences receives US FDA approval to manufacture and market Acetazolamide, Carbidopa and Levodopa tablets for the treatment of glaucoma and Parkinson’s disease. These products will be manufactured in Himachal Pradesh and Ahmedabad facilities of the company.

  • Nifty FMCG, Nifty IT and Nifty Consumer Durables trade in the red, while Nifty Realty and Nifty Metal gain more than 1% in mid-day trade.

  • Go Digit General Insurance refiles its IPO DRHP with a fresh issue of shares worth Rs 1,250 crore and offer for sale (OFS) of 10.9 crore shares.

  • Realty stock Macrotech Developers is rising as it reports a 34% increase in presales to Rs 12,064 crore in FY23, despite a YoY decline in Q4FY23. Its net debt has also fallen by 24% YoY in FY23. It shows up in a screener of stocks with improving net cash flow in the past two years.

  • TTK Prestige, L&T Technology Services and ICICI Securities fall 7.2%, 3.6% and 3.4% respectively over the past month, ahead of their Q4FY23 results.

  • Ajay Srivastava, Chief Executive Officer of Dimensions Corp, says that the RBI's pause on hiking repo rates will be beneficial for banks. However, he emphasizes that real estate investment may not give good returns at current rates.

  • Capacit'e Infraprojects is rising as it secures a Rs 474.08 crore order from Godrej Residency for building residential towers in Mumbai. The stock ranks high on Trendlyne's checklist score.

  • PSU bank stocks like Bank of Maharashtra, State Bank of India, Punjab National Bank and Punjab & Sind Bank are rising in trade as RBI keeps the repo rate unchanged at 6.5%, following six consecutive increases. The broader sectoral index Nifty PSU Bank is also trading in the green.

  • ICICI Securities maintains its ‘Add’ rating on Hindalco Industries but lowers its target price to Rs 450 from Rs 495. This indicates an upside of 11.4%. Although the brokerage remains optimistic about the firm’s long-term prospects, it expects short-term performance to be affected by high-interest rates in Europe, declining demand from North America and scrap supply constraints in South America.

  • Larsen & Toubro receives an order worth Rs 960.71 crore from Chambal Fertilisers & Chemicals to build a technical ammonium nitrate manufacturing plant, according to reports.

  • Amit Sajeja, Vice-President of Research for Commodities & Currencies at Motilal Oswal, says that the rupee is likely to face pressure towards December 2023 due to the slowdown in global economies.

  • Avenue Supermarts is falling despite a 20% increase in revenue to Rs 10,337.12 crore in Q4FY23. However, reports suggest that Citi continues to maintain its ‘Sell’ rating on the stock as the growth rate of average revenue per store and average revenue per square feet is lower than expectated. It shows up in a screener of stocks with declining net cash flow.

  • Tata Steel achieves its highest annual crude steel production ever in FY23, with a 4% YoY growth to 19.9 million tonnes. The increase is driven by debottlenecking measures implemented across its sites. In Q4FY23, crude steel production has risen by 5.1% YoY to 5.15 million tonnes.

  • Ramkrishna Forgings is rising as it bags an order worth Rs 12,226.5 crore from the Ministry of Railways to manufacture and supply 15.4 lakh forged wheels of different rolling stocks over the next 20 years. It shows up in a screener for stocks with consistent returns over five years.

  • The Reserve Bank of India (RBI) keeps repo rate unchanged at 6.5% after raising it for the previous six consecutive meetings.

  • Realty stocks like DLF, Godrej Properties, Indiabulls Real Estate and Oberoi Realty are rising in trade. The broader sectoral indices Nifty Realty and BSE Realty are also trading in the green.

  • RBI Governer Shantikanta Das says that the GDP growth projection for FY24 is at 6.5%. Additionally, the forecast for inflation for the year has been lowered from 5.3% to 5.2%.

  • Rail Vikas Nigam bags an order worth Rs 121 crore from the North Central Railway for the installation of E1-based automatic signalling with continuous track circuiting and associated works. It appears in a screener for stocks with improving cash flow.

  • Dolly Khanna sells a 0.2% stake in Tinna Rubber and Infrastructure in Q4FY23. She now holds a 1.4% stake in the company.

  • KEC International rises as it bags orders worth Rs 1,213 crore across business segments like transmission & distribution, civil and cables. The company's total order inflow in FY23 stands at Rs 22,378 crore, marking a 30% YoY increase.

  • Ujjivan Small Finance Bank’s gross loans rise 33% YoY to Rs 24,114 crore as of March 31. The bank's disbursements have increased by 42% in FY23, contributing to the growth in gross loans. Similarly, Equitas Small Finance Bank’s advance grows 36% YoY. Both banks report an increase in deposits in Q4. Ujjivan Small Finance Bank also sees a fall in gross NPA to 2.6%.

  • FSN E-Commerce Ventures’ (Nykaa) beauty and personal care segment sees strong demand in Q4FY23. Increasing order values and conversion rates aid revenue growth in Q4. The company expects over 30% revenue growth in FY23.

Riding High:

Largecap and midcap gainers today include Cholamandalam Investment & Finance Company Ltd. (841.40, 7.51%), Godrej Properties Ltd. (1,125.35, 6.52%) and Mahindra & Mahindra Financial Services Ltd. (252.15, 5.28%).

Downers:

Largecap and midcap losers today include Vedanta Ltd. (273.20, -4.56%), Avenue Supermarts Ltd. (3,496.10, -4.34%) and Varun Beverages Ltd. (1,393.50, -4.16%).

Volume Rockets

16 stocks in BSE 500 are trading on high volumes today.

Top high volume gainers on BSE included Indian Energy Exchange Ltd. (150.85, 10.51%), Aarti Drugs Ltd. (387.85, 8.44%) and Cholamandalam Investment & Finance Company Ltd. (841.40, 7.51%).

Top high volume losers on BSE were Shoppers Stop Ltd. (612.30, -3.67%), Nuvoco Vistas Corporation Ltd. (338.60, -1.67%) and Fortis Healthcare Ltd. (253.00, -1.06%).

Cholamandalam Financial Holdings Ltd. (579.85, 4.51%) was trading at 10.2 times of weekly average. TCNS Clothing Co. Ltd. (453.85, 2.44%) and Kansai Nerolac Paints Ltd. (391.90, 0.51%) were trading with volumes 8.9 and 8.8 times weekly average respectively on BSE at the time of posting this article.

BSE 500: highs, lows and moving averages

14 stocks made 52-week highs, while 3 stocks tanked below their 52-week lows.

Stocks touching their year highs included - Abbott India Ltd. (22,880.95, 0.15%), Cholamandalam Investment & Finance Company Ltd. (841.40, 7.51%) and Dr. Reddy's Laboratories Ltd. (4,699.40, 0.35%).

Stocks making new 52 weeks lows included - Aditya Birla Fashion and Retail Ltd. (215.85, 4.33%) and V-Mart Retail Ltd. (2,095.00, -2.04%).

25 stocks climbed above their 200 day SMA including Indian Energy Exchange Ltd. (150.85, 10.51%) and Firstsource Solutions Ltd. (111.70, 5.28%). 8 stocks slipped below their 200 SMA including Vedanta Ltd. (273.20, -4.56%) and Route Mobile Ltd. (1,276.75, -4.01%).

 
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The Baseline
05 Apr 2023
Analysts' choice: 5 stocks analysts are bullish on
By Abhiraj Panchal
  1. Rainbow Childrens Medicare: ICICI Direct initiates a ‘Buy’ call on this healthcare facilities company with a target price of Rs 840. This indicates an upside of 13.6%. Analysts Siddhant Khandekar, Kushal Shah and Utkarsh Jain say that the company has expertise in the most case-sensitive healthcare group of pediatric and perinatal care. They believe that it makes the company “a standout player”.  The healthcare company has planned to expand its presence by adding 850 beds across cities in the next four to five years. 

Khandekar, Shah and Jain say, “The company’s hub and spoke model will aid growth and accessibility for patients.” Rainbow Childrens Medicare also follows a doctor engagement model where most of its core specialists work at the hospitals on a full-time retainer basis, which the analysts believe has led to a high degree of full-time doctor retention. They expect revenues to touch Rs 1,098 crore, showing an improvement of 13% YoY in FY23. 

  1. Embassy Office Parks REIT: ICICI Securities maintains a ‘Buy’ call on this REIT with a target price of Rs 425, indicating an upside of 35.3%. The company's board has approved the acquisition of Embassy Business Hub, a property under development, for an enterprise value of Rs 330 crore. The acquisition will be funded through debt at an interest cost of 8.1% per annum. Analyst Adhidev Chattopadhyay expects that the rent from phase 1 will commence in Q1FY25 and phase 2 in Q1FY28, and it will derive an enterprise value of Rs 310 crore at an 8% cap rate for the acquisition, which he believes is value-neutral. 

The analyst remains cautious as the FY23 Union Budget carried a proposal to make the debt repayment/capital return portion of listed REITs taxable from FY24 and currently, 40% of the NDCF distribution profile for Embassy REIT comes from debt repayment which will become taxable from FY24. He concludes, “there may be some relaxation in the final version of the Budget proposal, with debt repayment not being taxed upfront,” for which we await final clarity. 

  1. HG Infra Engineering: IDBI Cap maintains a ‘Buy’ call on this construction and engineering company with a target price of Rs 1,067. This indicates an upside of 34.8%. Analysts Vishal Periwal and Prachi Kadam visited HG Infra’s Ganga expressway project site and interacted with the execution team and management. HG Infra was awarded the Ganga expressway project in Q1FY23, with a project cost of Rs 4,400 crore. The company scheduled the completion by January 2025 but the analysts say, “it is planning on early completion in 24 months, post which they will be eligible for an early completion bonus of Rs 50 crore.”

HG Infra has maintained its revenue target of growing 25% and 22% YoY in FY23 and FY24, respectively. The analysts expect margins to be in the range of 15%-16%. According to them, it is also eyeing order inflows of Rs 8,000-10,000 crore in FY24. 

  1. InterGlobe Aviation: Prabhudas Lilladher maintains its ‘Buy’ rating on this airliner with a target price of Rs 2,347. This implies an upside of 23.5%. Analysts Jinesh Joshi and Stuti Beria believe that the company is well-placed to capitalise on India’s rapidly growing aviation market as it has a 56% market share in India. They are also positive about the management’s plans to increase the fleet size to 350, expand the network to 115 destinations and increase carrying capacity by FY24. 

Joshi and Beria believe that the company is “well placed to strongly benefit from higher capacity deployment, network expansion in domestic as well as international markets, lower crude prices and superior industry cost structure in the current environment.” The analysts add that the management’s plan to increase international destinations will drive market share expansion. They expect the company’s revenue to grow at a CAGR of 40% over FY22-25. 

  1. Dalmia Bharat: Axis Direct keeps its ‘Buy’ rating on this cement manufacturer and raises its target price to Rs 2,260 from Rs 2,120. This indicates an upside of 14.6%. Analysts Uttam Kumar Srimal and Shikha Doshi believe that the company’s strategy to continue exiting from its non-core businesses augurs well, as it can focus solely on its cement business. They are also positive about the firm’s capacity expansion plans, and expect its overall cement capacity to touch 49 metric tonnes per annum in FY24. 

Srimal and Doshi expect demand for cement to grow at a CAGR of 7-8% over FY22-25 on the back of the increased government capex on infrastructure and housing. They believe “with the commissioning of new capacity and cost optimization measures'', the company will be a major beneficiary of the Centre’s infrastructure push. The analysts estimate the cement manufacturer’s net profit to grow at a CAGR of 12% over FY22-25.

Note: These recommendations are from various analysts and are not recommendations by Trendlyne.

(You can find all analyst picks here)

 
Trendlyne Marketwatch
Trendlyne Marketwatch
05 Apr 2023
Market closes higher, Grasim Industries receives Rs 5,000 crore credit line from Axis Bank

Trendlyne Analysis

Nifty 50 closed at 17,557.05 (159, 0.9%), BSE Sensex closed at 59,689.31 (582.9, 1.0%) while the broader Nifty 500 closed at 14,709.40 (107.5, 0.7%). Of the 1,964 stocks traded today, 1,450 were on the uptick, and 492 were down.

Indian indices closed in the green, with the Nifty 50 rising over the 17,550 mark. India’s Services PMI fell to 57.8 in March compared to 59.4 in February but remained above 50, which indicates an expansion in activity, for the 20th consecutive month.

Nifty Smallcap 100 closed in the green, taking cues from the benchmark index. However, Nifty Midcap 100 closed flat. Grasim Industries closed higher after it received a Rs 5,000 crore credit line from Axis Bank. The company plans to use the amount for capex and repay some of its existing loans.

Most European indices gave up their gains at the open and traded in the red, in line with US indices futures. However, most major Asian indices closed in the green. Brent crude oil futures traded lower but crude oil prices are up over 6% in the last three trading sessions after OPEC+ announced oil production cuts on Sunday.

  • Avalon Technologies’ Rs 865 crore IPO gets bids for 9% of the available 1.14 crore shares on offer on the second day of bidding. The retail investor quota gets bids for 49% of the available 20.8 lakh shares on offer.

  • Relative strength index (RSI) indicates that stocks like Aurobindo Pharma, Bosch, Ingersoll-Rand (India) and KSB are in the overbought zone.

  • Ashok Leyland falls 4% in trade today. This is after the company reported an increase in wholesales across medium & heavy commercial vehicles in March. The stock ranks medium on the Trendlyne checklist score and shows up in a screener with declining RoE in the past two years.

  • FSN E-Commerce Ventures (Nykaa) rises 7% as reports suggest that 55 lakh shares worth Rs 75.5 crore change hands via a block deal. It is one of the top gainer stocks and is trading above its second resistance or R2 level.

  • Bharat Forge is falling as reports suggest a decline in demand for Class-8 trucks in North America. Orders in March have fallen 10% YoY and 17% MoM to 19,000 units. The stock shows up in a screener for companies with high promoter stock pledges.

  • RPP Infra Projects rises as it wins an order worth Rs 491.33 crore under the combined water supply scheme. It will be a subcontract from the joint venture with V. Sathyamoorthy & Co.

  • Indian Energy Exchange (IEX) is rising despite its trade volumes falling 4% YoY to 9,212 million units. According to Grid-India’s data, energy utilization for India has declined 2% YoY, but electricity demand is likely to go up with rising temperatures. IEX hit its 52-week low in the past week.

  • Ahluwalia Contracts secures an order worth Rs 557 crore to construct Dharavi Wastewater Treatment Facility under the Mumbai Sewage Disposal Project. It shows up in a screener for stocks in the Nifty 500 with consistently high returns over five years.

  • Hindustan Zinc is up 2% after reporting a 7% YoY increase in metal production to 10.3 lakh tonnes in FY23 due to better plant availability and continuous flow of mined metals. However, the consensus recommendation for the stock from nine analysts is ‘Sell’, according to Trendlyne’s Forecaster. Reports suggest that the company may not buy Vedanta’s zinc business as the Centre opposes the deal.

  • JP Morgan places HCL Technologies on its negative catalyst watch as it expects high risk in the near term ahead of Q4FY23 results.

  • Grasim Industries is rising as it receives a Rs 5,000 crore credit line from Axis Bank. It plans to use the amount for capex and repay some of its existing loans. It shows up in a screener of stocks with improving RoCE in the past two years. However, the stock has fallen 2% in the past year.

  • Utilities, cement & construction and retailing sectors rise by more than 2.6% over the past month.

  • IndusInd Bank's net advances rise 21% YoY to Rs 2.4 lakh crore, and deposits grow 15% YoY as of March 31, 2023. Federal Bank's net advances also increase 20.2% YoY, while deposits rise 17.4%.

  • Godrej Consumer Products expects double-digit growth in volume and EBITDA, and improvement in gross margin in Q4FY23. According to its management, volume growth is mostly driven by the home and personal care segment. The stock hit a 52-week high in the past week.

  • Pranjul Bhandari, Chief India Economist at HSBC Securities & Capital Markets (India), expects the RBI to hike interest rates by 25 bps tomorrow. She says a change in stance or growth forecast is not likely.

  • Sharekhan maintains its ‘Buy’ rating on Bharat Electronics with a target price of Rs 120, indicating an upside of Rs 96.6. The brokerage believes the firm’s strong manufacturing base, robust order book, healthy balance sheet and focus on diversification will drive growth in the coming quarters. It expects the company’s revenue to grow at a CAGR of 15.4% over FY22-25.

  • Bajaj Auto's total wholesales fall 2% YoY to 2.9 lakh units in March 2023. Its total domestic wholesales rise 47% YoY but total exports drop 38% YoY.

  • India’s Services PMI falls to 57.8 in March compared to 59.4 in February but remains above 50 for the 20th consecutive month.

  • Bosch, Cyient and ICICI Prudential Life Insurance rise 9.2%, 8.6% and 7.2% respectively over the past month, ahead of their Q4FY23 results.

  • Timothy Moe, Chief Asia Pacific Strategist at Goldman Sachs, expects Nifty to reach 20,000 over the next year. The global investment bank recommends buying Indian equities saying it is time to accumulate stocks trading at reasonable prices.

  • Larsen & Toubro's arm L&T Energy Hydrocarbon wins multiple offshore contracts worth Rs 7,000 crore from clients in West Asia. The scope of the work comprises engineering, procurement, construction and installation of new offshore facilities and integration with existing installations.

  • Adani Ports & Special Economic Zone is rising as its FY23 port cargo volumes increase 9% YoY to 339 million metric tonnes (MMT). The company’s monthly cargo volumes in March have risen 9.5% YoY to 32 MMT. The stock shows up in a screener for companies with book value per share improving over the past two years.

  • RailTel Corporation bags a Rs 76.1 crore order from the Bihar State Electronics Development Corporation to implement digital infrastructure in government colleges. It has also received a Rs 38.9 crore order from the National Informatics Centre for a leased line across 19 sites.

  • World Bank revises India’s FY23-24 GDP growth forecast to 6.3% from the earlier estimate of 6.6%. It expects a slowdown because of fall in consumption due to rising borrowing costs and lower income growth.

  • Paytm’s loan disbursements rise 82% YoY in Q4FY23 due to an increase in its consumer and merchant base. Value of loans surge 253% to Rs 12,554 crore, while gross merchandise value and average monthly transacting users also grow with payment volumes in Q4. The stock has gained 21% in the past three months.

  • Suzlon Energy's Chief Executive Officer Ashwani Kumar steps down from the post due to personal reasons. Its board approves JP Chalasani as the replacement with immediate effect.

  • Centre removes windfall tax on locally produced crude oil from the earlier Rs 3,500 per tonne and cuts export duty on diesel to Rs 0.50 per litre from Rs 1.

  • Cyeint rises after a reshuffle in its top management roles. It promotes Karthik Natarajan to the post of Executive Director and Chief Executive Officer and appoints Krishna Bodanapu as the Executive Vice-Chairman and Managing Director.

  • Ashish Kacholia cuts his stake in IOL Chemicals and Pharmaceuticals to below 1% in Q4FY23, as against 2% held in Q3FY23.

  • NBCC bags an order to construct roads along the Bangladesh border in Mizoram for Rs 448 crore. The stock is up 3% and gains 38.2% from its 52-week low.

  • Bajaj Finance’s assets under management in FY23 grow 29% YoY to Rs 2.47 lakh crore, while its deposit book surges by 45% YoY. The company’s consolidated net liquidity surplus stood at Rs 11,850 crore as of March 31, indicating a strong liquidity position. The stock shows up in a screener for companies with improving cash flows and high durability scores.

Riding High:

Largecap and midcap gainers today include FSN E-Commerce Ventures Ltd. (136.65, 7.77%), L&T Technology Services Ltd. (3,652.50, 6.32%) and Coforge Ltd. (4,079.20, 5.92%).

Downers:

Largecap and midcap losers today include Ashok Leyland Ltd. (134.75, -4.43%), Aditya Birla Fashion and Retail Ltd. (206.90, -3.90%) and Adani Transmission Ltd. (907.85, -3.77%).

Crowd Puller Stocks

18 stocks in BSE 500 are trading on high volumes today.

Top high volume gainers on BSE included Tata Investment Corporation Ltd. (1,940.90, 9.46%), Elgi Equipments Ltd. (466.40, 7.55%) and Aegis Logistics Ltd. (400.05, 6.41%).

Top high volume losers on BSE were Ashok Leyland Ltd. (134.75, -4.43%) and Aditya Birla Fashion and Retail Ltd. (206.90, -3.90%).

Rossari Biotech Ltd. (606.00, 0.61%) was trading at 6.9 times of weekly average. JK Cement Ltd. (2951.15, 1.31%) and J B Chemicals & Pharmaceuticals Ltd. (1,975.00, 0.83%) were trading with volumes 5.0 and 4.2 times weekly average respectively on BSE at the time of posting this article.

BSE 500: highs, lows and moving averages

13 stocks overperformed with 52-week highs,

Stocks touching their year highs included - Abbott India Ltd. (22,839.00, 2.62%), Aegis Logistics Ltd. (400.05, 6.41%) and AIA Engineering Ltd. (2,965.70, 0.37%).

25 stocks climbed above their 200 day SMA including Elgi Equipments Ltd. (466.40, 7.55%) and L&T Technology Services Ltd. (3,652.50, 6.32%). 6 stocks slipped below their 200 SMA including Orient Electric Ltd. (246.10, -2.94%) and Hitachi Energy India Ltd. (3,224.05, -2.08%).

 
Trendlyne Marketwatch
Trendlyne Marketwatch
03 Apr 2023
Market closes higher, Tejas Networks bags order worth Rs 696 crore from BSNL

Trendlyne Analysis

Nifty 50 closed at 17,398.05 (38.3, 0.2%), BSE Sensex closed at 59,106.44 (114.9, 0.2%) while the broader Nifty 500 closed at 14,601.95 (44.1, 0.3%). Of the 1,977 stocks traded today, 1,559 were on the uptrend, and 384 went down.

Indian indices settled in the green after switching between losses and gains on a volatile day of trade. Tejas Networks closed over 4% higher after it won its largest-ever order worth Rs 696 crore from Bharat Sanchar Nigam (BSNL).

Nifty Smallcap 100 and Nifty Midcap 100 closed in the green, outperforming the benchmark index. Nifty Bank and Nifty Media closed higher than Friday’s levels. Nifty Auto closed sharply higher, led by heavyweights Maruti Suzuki and Mahindra & Mahindra.

European stocks traded higher, taking cues from the major Asian indices, which closed in the green. However, US indices futures traded lower as investors assessed the impact of rising crude oil prices on already high inflation levels. Brent crude oil futures rose over 5% on the back of production cuts by OPEC+.

  • Avalon Technologies’ Rs 865 crore IPO gets bids for 3% of the available 1.14 crore shares on offer on the first day of bidding. The retail investor quota gets bids for 16% of the available 20.8 lakh shares on offer. The IPO consists of a fresh issue of shares worth Rs 320 crore and an offer for sale of Rs 545 crore.

  • Mahanagar Gas sees a short buildup in its March 29 future series as its open interest rises 53% with a put-call ratio of 0.48.

  • Ed Yardeni, President of Yardeni Research, says the US Federal Reserve will likely hike interest rates by 25 bps. He expects inflation to moderate further.

  • PNB Housing Finance rises as Morgan Stanley gives an ‘overweight’ call on the stock with a target price upside of 32%. This comes after the company’s board approved a rights issue of 9.06 crore shares to raise up to Rs 2,500 crore. Morgan Stanley expects PNB Housing Finance’s net profit to rise by 8-9% over FY24-25.

  • Tata Motors’ monthly wholesales in March rises 3% YoY to 89,351 units, driven by a 4% YoY and 3% YoY growth in total passenger vehicle and domestic commercial vehicle sales. Its electric vehicle (EV) sales jump 89% YoY to 6,509 units. The stock shows up in a screener for companies with a low PE Ratio.

  • Tejas Networks is surging as it wins an order worth Rs 696 crore from Bharat Sanchar Nigam (BSNL) to supply, install and commission 13,000 of its access and aggregation routers.

  • ICICI Bank, Nippon Life India Asset Management and Poonawalla Fincorp's weekly average delivery volumes rise ahead of their Q4FY23 results in April.

  • Rail Vikas Nigam is rising as it receives two orders from the NHAI totalling Rs 1,992.7 crore. The first project involves the construction of a six-lane elevated expressway in West Bengal for Rs 720.7 crore. The company also bagged a contract for constructing a six-lane highway in Jharkhand for Rs 1,272 crore through its consortium, in which its share is 49%.

  • Deepak Khetrapal, Managing Director and CEO of Orient Cement, expects demand for cement to increase by 10-12% in FY24. He says there is a need to increase the price of cement by Rs 40-50 per bag in South India.
  • Telecom stocks like Vodafone Idea, Tejas Networks, Tata Teleservices (Maharashtra) and Optiemus Infracom are rising in trade. The broader sectoral index BSE Telecom is also trading in the green.

  • Anil Gupta, promoter of KEI Industries, sells a 0.22% stake in the company on Friday. He now holds a 12.18% stake.

  • HG Infra Engineering is rising after winning two projects from the National Highway Authority of India, for constructing two 6-lane highways in Jharkhand worth Rs 1,762.4 crore for the Varanasi-Kolkata route.

  • India’s manufacturing PMI touches a three-month high of 56.4 in March, compared to 55.3 in February on the back of improving output and new orders.

  • ICICI Direct initiates coverage on CreditAccess Grameen with a ‘Buy’ rating and a target price of Rs 1,100. This implies an upside of 20.1%. The brokerage believes that the firm is well-placed to expand further in the untapped microfinance space given its deep penetration and increasing customer base. It expects the company’s net profit to grow at a CAGR of 52% over FY22-25.

  • Crude oil prices rise over 5% to $84 per barrel, after OPEC+ announces a production cut of 1.15 million barrels per day. David Lennox, Resource Analyst at Fat Prophets, expects crude oil prices to hover around $85-87 per barrel in the near term.

  • Maruti Suzuki is rising despite its passenger vehicle (PV) wholesales declining by 1% YoY to 1.3 lakh units. Mahindra & Mahindra is also up as its PV wholesales increase 30% on the back of growth in SUV sales.

  • SpiceJet is rising as it sells its cargo and logistics division for Rs 2,555.7 crore, converting it into a separate entity called SpiceXpress and Logistics Private Ltd. According to MD & Chairman Ajay Singh, this hive-off will "reduce SpiceJet’s negative net worth and strengthen SpiceJet's balance sheet".

  • Avalon Technologies raises Rs 389.25 crore from anchor investors ahead of its IPO by allotting 89.27 lakh shares at Rs 436 per share. Investors include Goldman Sachs, Neuberger Berman Emerging Markets Equity Fund and Mahindra Manulife Mutual Fund.

  • JP Morgan initiates coverage on KPIT Technologies with an ‘Underweight’ rating and a target price of Rs 520. The brokerage expects a slowdown in the growth of the company by over 20% in the next few years.

  • Barbeque-Nation Hospitality falls after reporting a ransomware attack on Friday. The company is investigating the incident and will take corrective actions. However, it maintains that its core operations are unaffected and restaurants are working efficiently.

  • Government Of Singapore sells a 2.9% stake (51.5 lakh shares) worth Rs 670 crore in Phoenix Mills in a bulk deal on Friday.

  • Ashoka Buildcon rises as it receives a letter of acceptance from the Ministry of Railways for civil engineering works and the supply of machine-crushed stones for the North Central Railway project. The contract value is Rs 284.6 crore.

  • Gujarat Gas's Managing Director Sanjeev Kumar resigns on account of his appointment as Principal Secretary to the Government Forests & Environment Department, effective from April 1, 2023.

  • G R Infraprojects is rising as it wins two projects for building greenfield highways in India's north and south belts. The first order worth Rs 847.8 crore is to build a four-lane highway in Telangana and the other for a six-lane highway worth Rs 1,248.3 crore on the Varanasi-Kolkata route.

  • Hindustan Aeronautics’ revenue rises 7.6% YoY to Rs 26,500 crore in FY23. Its order book stands at Rs 82,000 crore as of the end of March. Meanwhile, Bharat Electronics’ revenue and exports increase 15% YoY to Rs 17,300 crore and 40% in FY23. Its order book stands at Rs 60,500 crore.

Riding High:

Largecap and midcap gainers today include Vodafone Idea Ltd. (6.15, 6.03%), Procter & Gamble Hygiene & Healthcare Ltd. (1,4031.35, 5.19%) and Indian Railway Finance Corporation Ltd. (27.80, 4.51%).

Downers:

Largecap and midcap losers today include Adani Transmission Ltd. (943.40, -5.00%), Adani Green Energy Ltd. (837.45, -4.96%) and Hindustan Petroleum Corporation Ltd. (225.50, -4.77%).

Volume Rockets

14 stocks in BSE 500 are trading on high volumes today.

Top high volume gainers on BSE included Rail Vikas Nigam Ltd. (75.35, 9.84%), Balaji Amines Ltd. (2,100.00, 8.06%) and Laxmi Organic Industries Ltd. (240.15, 7.81%).

Top high volume losers on BSE were KPIT Technologies Ltd. (811.20, -12.31%), Mahanagar Gas Ltd. (920.95, -6.36%) and Orient Electric Ltd. (253.55, -6.20%).

Suven Pharmaceuticals Ltd. (470.70, -0.36%) was trading at 7.4 times of weekly average. Graphite India Ltd. (275.80, 5.05%) and Hindustan Petroleum Corporation Ltd. (225.50, -4.77%) were trading with volumes 4.3 and 3.7 times weekly average respectively on BSE at the time of posting this article.

BSE 500: highs, lows and moving averages

11 stocks took off, crossing 52-week highs, while 1 stock hit 52-week low.

Stocks touching their year highs included - AIA Engineering Ltd. (2954.80, 1.78%), Zydus Lifesciences Ltd. (492.40, 0.17%) and Dr. Reddy's Laboratories Ltd. (4,656.50, 0.73%).

Stock making new 52 weeks lows included - TeamLease Services Ltd. (2,203.10, -1.62%).

25 stocks climbed above their 200 day SMA including Procter & Gamble Hygiene & Healthcare Ltd. (14,031.35, 5.19%) and Tejas Networks Ltd. (607.95, 4.67%). 15 stocks slipped below their 200 SMA including Orient Electric Ltd. (253.55, -6.20%) and Hindustan Petroleum Corporation Ltd. (225.50, -4.77%).

 
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The Baseline
31 Mar 2023
Five Interesting Stocks Today
  1. Bharat Electronics: This public sector defence company has bagged multiple orders worth nearly Rs 16,300 crore in March for the supply of indigenously developed equipment and electronic warfare systems to the Indian Army, Navy and Air Force. These order wins come after the company’s order inflow fell to a two-year low of Rs 3,500 crore during the first nine months of FY23 due to approval delays.

The company is expected to be a major beneficiary of the Centre’s push for reducing defence imports, as it commands a market share of 37% in the Indian defence sector. According to Geojit BNP Paribas, the company’s order book backlog of Rs 50,116 crore provides strong revenue visibility over the next three years. The company shows up in a screener for stocks with consistently high returns over the past five years. According to Trendlyne’s Forecaster, the consensus recommendation from 20 analysts is ‘Buy’.

While the management is optimistic about growth in orders from the defence sector, it plans to diversify into non-defence sectors like healthcare, airports, infrastructure and smart city projects. The firm’s long-term plan is to increase the contribution of its non-defence segment to 25% from 10% of total revenue.

With the rise in demand for locally manufactured defence systems, the company expects these orders to increase in the coming years. To be able to meet the upcoming requirements, it aims to make five new facilities operational in the next two-three years. It has budgeted a capex of Rs 600 and Rs 600-800 crore for FY23 and FY24 respectively. The management expects revenue to grow in the range of 15-20% in FY24, led by large orders and commissioning of new facilities.

  1. Zydus Lifesciences: This pharmaceutical company reached its 52-week high of Rs 493.2 per share on Wednesday after receiving two US FDA approvals on the same day. The company shows up in a screener of stocks with strong momentum.

Zydus Lifesciences received final approval from the US FDA for its loperamide hydrochloride capsules, used for the treatment of inflammatory bowel disease, on Tuesday. According to IQVIA, the capsule has had an estimated annual sales of $34.7 million in the year ended January 2023 in the US.

The company received final approval from the US FDA for its levothyroxine sodium injection as well on Tuesday. The capsules, used for the treatment of myxedema coma, will be manufactured at its facility in Jarod, Gujarat.

However, it’s not all good news for the company. Earlier in the week (on Sunday), the drug manufacturer announced that it had recalled 55,000 bottles of colchicine tablets after it received an out-of-specification (OOS) result during release testing.

According to Sharekhan, the drug manufacturer stands to gain from strong product launches and volume growth in the US market, as its revenue of Rs 1,925 crore in Q3FY23 contributed to 44% of the total revenues. The brokerage estimates the company’s revenue to grow at a CAGR of 7.5% during FY22-25 and maintains its ‘buy’ rating on the stock with a target price of Rs 572. Trendlyne’s forecaster estimates its revenue to rise by 9.9% in FY23.

  1. Allcargo Logistics: This logistics company rose over 2.4% on Tuesday after announcing its plan to acquire a 30% stake in Gati-Kintetsu Express for Rs 406.7 crore. Allcargo will buy shares from KWE Singapore (26% stake) and KWE India (4% stake). Gati-Kintetsu Express is a JV of Allcargo’s group company Gati and Kintetsu World Express. Gati deals in overseas courier services, while KWE is a Japanese freight forwarding company.

Allcargo has been on an acquisition spree over the past few months. The company had also bought the remaining 38.9% stake from its partner, ACCI, in the contract logistics business at an enterprise value of Rs 373 crore earlier this month.

In January, it bought a 75% stake in German cargo consolidator Fair Trade for 12 million euros, according to reports. Speaking to the media about the company’s recent acquisitions, Ravi Jakhar, the Chief Strategy Officer said the acquisitions were in line with the company’s strategy to simplify the organisational structure, enhance its growth in the domestic supply chain, and strengthen its position in key strategic markets.

Apart from the acquisitions, the company sold 90% of its logistics parks business to private equity firm Blackstone in February. Allcargo will also sell its non-core customs business.

However, despite a recent rise in its share price, the company is still down 27.3% from its 52-week high of Rs 495 in November 2022. But, it ranks high on Trendlyne’s checklist with a score of 73.9% and shows up in a screener for stocks with high Piotroski scores.

  1. Jindal Stainless: This metals & mining stock rose 4% in early trade on Wednesday after it announced an acquisition of a 49% stake in Indonesia-based Nickel Pig Iron Co. However, it pared the gains and closed 0.2% lower. Jindal Stainless (JSL) plans to invest $157 million (Rs 1,290 crore) over the next two years to build a facility with a production capacity of 2 lakh metric tonnes. The company’s Managing Director Abhyuday Jindal says that not having backward integration for nickel is a big risk for the nation as we face a deficiency in nickel reserves.

This acquisition will help the company secure the supply of nickel, a critical raw material used in making alloys. Jindal Stainless has a series of other projects lined up. The company has announced an investment of Rs 120 crore to set up rooftop solar projects in Jajpur and Hisar facilities.

Sector growth looks decent for JSL as Bank of America Securities has given a positive stance for the near term. It expects steel demand to bounce back, resulting in higher prices. It also expects export opportunities to improve as export duty on steel has been scrapped.

Although the stock has fallen 5% in the past week, it gained 23.4% in the past three months and outperformed its sector by 3.7% in the past month. Jindal Stainless was a multi-bagger stock last year (gaining nearly 199%) but gained only 43.5% this year. Trendlyne’s Forecaster estimates a 5.7% increase in its annual revenue in FY23.

  1. Sun Pharmaceuticals Industries: Thispharmaceutical giant expects its revenue to take a hit after reporting a ransomware attack on its system in early March. It reported a breach of some files and theft of company and personal data, impacting operations. The firm has isolated its network and started the recovery process. It is also evaluating the expenses for litigation and insurance. The stockfell nearly 3% the following week.

The firm did a series of acquisitions in Q4FY23, including a 60% stake in Vivaldis Health and Foods for Rs 143 crore in March, US-based Concert Pharmaceuticals for USD 576 million and a minority stake in Agasta Software and Remidio Innovative Solutions.

Lately, Sun Pharma has been focusing on the domestic market to increase its market share. The US and India each contribute 31% of revenue to the company, while emerging markets contribute 19%. It has nearly 9% share of the pharma market in India. Market share growth coupled with new launches for India formulations have led top-line growth in Q3FY23. Focusing on the global specialty portfolio also led to an increase in the margins. The specialty portfolio contributes nearly 13% of its revenue. The stock shows up in a screener for top Indian exporters among listed companies.

According to the management, its US portfolio is expected to grow 4.6%, while the India division should rise 7%. Its chronic portfolio is also expected to see strong growth led by new launches.

ICICI Securities says Sun Pharmaceuticals’ India business will outperform the industry, and global specialty sales will help margin expansion. Meanwhile, profitability will be slightly offset by rising R&D spend.


Trendlyne's analysts identify stocks that are seeing interesting price movements, analyst calls, or new developments. These are not buy recommendations.