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The Baseline
26 Nov 2022
MFs choose mid and smallcap stocks, prefer healthcare and banks in Q2FY23
By Deeksha Janiani

Most people have the intelligence to pick stocks - but not everyone has the stomach. This is especially true in a volatile stock market, as downside risks increase. Even India's mutual fund managers have become cautious about fresh stock buys, as markets grew moody in a slowing global economy. Their investments in Q2FY23 rose at the slowest rate since Q1FY22, and they preferred sectors with good potential while cutting stakes in those losing traction. 

In this week’s Analyticks:

  • MFs make their bets: Where did the smart money go in Q2FY23?
  • Screener: Companies in which promoters bought or sold over 0.5% stake in Q2

Let’s get into it.

Domestic mutual funds pick new favourites in Q2FY23

Indian indices rode turbulent seas in the past year. After touching their lows in mid-June, the Nifty 50 index and BSE Sensex gained around 18% by mid-September.

Domestic mutual funds pumped over Rs 70,000 crore into equities in Q1FY23, when valuations were comfortable. However, their buying activity slowed down to approx Rs 22,000 crore in Q2 as they became more selective. One reason was rising valuations: according to reports, Nifty 50 is trading at an average 1-yr forward PE of around 20X, which is 22% higher than its long-term average of 16X.

The stock market is commanding a premium despite a series of downgrades for India’s GDP growth rate in FY23 and in the earnings of top companies. This has kept domestic funds on the fence. 

In this week’s edition, we take a look at the top companies and sectors which mutual funds are still bullish on, buying significant equity stakes on a QoQ basis in Q2FY23. We also analyze sectors that saw intense selling action.

Mutual funds pick up over 2.5% stake in key small and mid-cap companies

Mutual funds led by SBI MF bought over 6% stake in auto ancillary player Sona BLW Precision and construction company G R Infraprojects,  in Q2FY23. This buying activity specifically took place as the promoters of these firms sold off partial stakes in the open market. Triveni Turbine saw its promoters selling over 11.5% stake in Q2, after which FIIs and domestic mutual funds increased their holdings in the company. 

MFs led by Nippon India funds, Mirae asset funds and ICICI Prudential funds picked up 2.9% stake in Gland Pharma. Notably, this company lost over 25% of its value in Q2 on intense selling by foreign and retail investors. The financial stress on its promoter entity, Fosun International, spooked markets. 

Auto OEMs and ancillaries see fresh buying on improved demand and easing chip supply 

Passenger and commercial vehicle makers saw a robust rise in their wholesales in the first two quarters of FY23 on the back of healthy festive demand and easing semiconductor supplies. However, two-wheeler makers are yet to see the sales levels of the pre-covid era. 

Prices of key base metals used in auto manufacturing like steel, aluminium and copper cooled off by 25-35% from the highs of March 2022. Rising sales volumes and lower metal costs helped the margins of auto OEMs and ancillaries. 

Mutual Fund houses picked up stakes in auto majors like Maruti Suzuki and Hero MotoCorp in Q2. In fact, Maruti saw consistent buying from mutual funds between May and September 2022. Fund houses also raised their holdings in auto ancillaries like Bosch, Ceat and Sundaram Fasteners. 

Small and mid-cap banks and NBFCs attract mutual fund investments in Q2

Banks and NBFCs are the flavour of this season for many investors. The industry saw a strong rise in their advances in both Q1 and Q2 backed by robust traction in retail loans, particularly housing, auto and personal loans. This led to healthy growth in their net interest incomes. The recent interest rate hikes also improved their net interest margins. 

Domestic MFs bought stakes in small and mid-cap banks like Au Small Finance Bank, Federal Bank and RBL Bank. They also raised their stake in NBFCs like Muthoot Finance, IDFC and LIC Housing Finance in Q2. 

Ambitious expansion plans of healthcare players pique MF interest 

Top hospital chains saw their occupancy levels improve steadily from Q4FY22, which was  hit by the omicron wave. Their average revenue per operating bed also saw a healthy rise sequentially as their payer mix improved. But what has caught investor interest is their aggressive expansion plans, which were paused between FY20-22 due to the pandemic. 

Mutual fund houses picked up a 1%+ stake inKIMS, Max Healthcare and Apollo Hospitals in Q2. MFs also bought over 12% stake in Max Healthcare in the past four quarters. These chains plan to expand their bed capacity by 20% in the next three years. 

MFs pour in funds in top hotels and restaurants ahead of the upcoming holiday rush

The hospitality sector saw strong demand in the summer of ’22 and the monsoon months, thanks to leisure travel and an increase in corporate events. The outlook is encouraging for this sector as highlighted by the management of Indian Hotels. The upcoming wedding and holiday season as well as the influx of foreign travellers during the winter months in H2FY23 is set to drive higher topline growth for hotels. 

Mutual funds bought over 1.5% stake in Indian Hotels and EIH in Q2. They also raised holdings in QSR chains like Jubilant Foodworks, Sapphire Foods and Westlife Development, backed by strong consumption trends. 

MFs place bets on general industrials, as capex activity picks up in key sectors

Heavy electrical equipment manufacturers saw strong demand from sectors like railways, mining, data centres, commercial realty, biotechnology and pharma. As a result, most companies saw their order book jump by over 30% YoY at the end of September 2022. 

The outlook for these companies is positive, backed by the government's focus on infrastructure development, the Make-in-India initiatives and 14 PLI schemes approved for encouraging higher private capex. 

Domestic fund houses added on to their stakes in CG Power, Cummins India, Bharat Heavy Electricals and Triveni Turbine in Q2FY23. DSP Funds led the buying activity in CG Power, while Nippon India, Tata Funds and Edelweiss led purchases in BHEL. 

Mutual funds rejig their holdings in the pharma space

Pharma players have seen muted growth in the past few quarters due to intense competition in the US Generics market. The Indian pharma market performed well in comparison. Now that companies are diversifying away from generics and into speciality drugs, hopes are high for this space. 

Mutual funds have cut more than 1% stake in large-cap players like Dr. Reddy’s and Torrent Pharma. On the other hand, they have added to their holdings in mid and small-cap companies like Alkem Labs, Syngene International and Suven Pharma. 

Mutual funds cut stake in an oil marketing company and consumer durable makers

OMCs like Bharat Petroleum and Hindustan Petroleumsuffered material net losses in the past two quarters. This was on account of negative marketing margins on diesel, as pump prices were not in sync with global levels. Accordingly, mutual funds sold 3% stake in BPCL in Q2. This was led by Nippon India funds, Mirae asset funds, Aditya Birla funds and Franklin India funds. 

Mutual funds also cut their stake in consumer durable players like KEI Industries, Voltas and Orient Electric. Higher inflation has impacted the demand in mass market segments of these companies in the past few quarters. 

MFs reduce holdings in metals and mining companies on reversal of fortunes 

Correction in metal prices and higher input costs led to a substantial contraction in the EBITDA of top steel and aluminium producers in H1FY23. Subdued demand, particularly from China and other developed nations, weighed on the international prices of key metals. 

Seeing the metals cycle heading downwards, mutual funds cut stake in Tata Steel, Hindalco and Vedanta in Q2FY23. The selling activity in Tata Steel was led by SBI mutual funds, Nippon India funds and Kotak funds. 

Screener: Increasing or Decreasing Promoter Holding QoQ

In this edition, we take a look at major stocks which saw over 0.5% QoQ rise or fall in the holdings of their respective promoters in Q2FY23. This screener features 33 stocks from Nifty 500 and 4 stocks from the Nifty 50 index. 

Stocks from industries like cement & cement products, IT consulting & software, healthcare facilities, auto parts & equipment and pharmaceuticals show up in this list. Major stocks in the screener include UNO Minda, ACC, Infosys, Max Healthcare Institute, Sona BLW Precision Forgings and HDFC Asset Management.

Uno Minda’s promoter holding increased the most, by 2.7% QoQ in Q2FY23. Axis Securities believes that the company’s well-diversified product portfolio and increasing electric vehicle kit value will lead to higher wallet share with existing and potential clients. 

ACC saw its promoter holding rise by 2.2% QoQ in Q2FY23. BNP Geojit Paribas believes that the recent reduction in energy prices and a traditional post-monsoon rebound will boost the company’s performance in the upcoming quarters. 

Max Healthcare Institute’s promoter holding fell the most by 26.8% QoQ in Q2FY23. PE firm KKR sold its entire stake in the company for over Rs 9,000 crore via its affiliate, Kayak Investments, in August 2022. 

You can find some popular screeners here.

 
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The Baseline
25 Nov 2022
Five Interesting Stocks Today
  1. InterGlobe Aviation (Indigo): This airline stock fell 4.9% following its Q2FY23 results as it posted a net loss of Rs 1,435.7 crore. However, the company’s revenue rose by 122.8% YoY to Rs 12,497.6 crore on the back of a 75.9% YoY increase in passengers carried in Q2FY23 (1.9 crore).

Pieter Elber, Chief Executive Officer (CEO) of the company, said, “This is the second consecutive quarter in which we operated at higher than pre-covid capacity. In spite of a seasonally weak quarter, we witnessed relatively good yields with strong demand across the network. However, fuel prices and exchange rates have adversely impacted our financial performance.” The company’s revenue beat Trendlyne’s Forecaster estimates by 10.9%.

Over the past two weeks, the stock rose 10.7% as the airline launched its first freighter aircraft from Mumbai to Delhi on November 15. More recently, Indigo launched 19 connecting flights to Europe under its codeshare partnership with Turkish Airlines on Thursday. The airline will have connecting flights to Portugal and Switzerland through Istanbul.

According to ICICI Securities, domestic demand will continue to rise in the upcoming festive and winter season. International air travel has also demonstrated a strong recovery, which is likely to continue. The company features in a screener of stocks benefiting from lower crude oil prices.

  1. Aarti Industries: This specialty chemicals company was up 2.4% in trade on Monday after it announced a 20-year arrangement for the supply of Nitric Acid worth Rs 8,000 crore with Deepak Nitrite on November 19. Although the stock rose on Monday, it cut its gains and is now trading near its 52-week low of Rs 642.1. The company has underperformed the Chemicals & Petrochemicals sector by 1.8%; its PE ratio TTM (18.6) is below the sector PE ratio.

Post Aarti’s announcement, Anand Rathi maintained its ‘Buy’ rating and revised the target price to Rs 800. The brokerage believes that the agreement with Deepak Nitrite would enable Aarti Industries to focus on growth opportunities and introduce value-added products.

However, the company’s share price has fallen over 50% from its 52-week high after the demerger from its pharma business. Rajendra Gogri, Chairman and Managing Director, said in the earnings call, “This will extensively enhance value for our stakeholders and also help us achieve operational efficiencies.”

KR Choksey maintains its ‘Buy’ rating on the stock with a target price of Rs 841. This indicates a potential upside of 24.2%. The brokerage says that the demerger from Aarti’s pharma business will enable it to pay attention to its core speciality chemicals business.

  1. Medplus Health Services: This healthcare supplies company has risen nearly 15% after its Q2FY23 results announcement. Medplus Health Services’ revenue grew over 20% YoY in Q2 but its net profit fell sharply by 68% due to high overhead costs. But what’s exciting investors could be the pace at which the company is adding new stores. The company is in a phase of rapid expansion. It added 348 stores (net) in Q2FY23, which is 1.5x its usual average. In fact, in the last 12 months, Medplus’s total store count increased by 42%. Management expects sales growth to remain steady as stores mature, and margin pressure to continue in the near term as it maintains 1,000+ store additions in FY23.

The pharmacy segment (both offline and e-commerce) is under intense competition with companies from different industries. While peers like PharmEasy are expanding aggressively in this segment, hospital companies like Apollo Hospital Enterprises and Aster DM Healthcare are also after market share in the pharmacy space. As a result, Medplus’ stock price fell over 35% from its issue price of Rs 796 and hit a lifetime low of Rs 570 on November 10. However, with the Q2 results announcement, MedPlus’ share price recovered, helping it feature in a screener of companies that are classified as overbought by the money flow index (MFI).

Post Q2 results, Nomura and Credit Suisse maintained their ‘Buy’ rating on Medplus and increased their target price. Nomura sees an upside of 60%, while Credit Suisse’s target price implies an upside of 28%. With 33% of the total stores being less than 12 months old, brokerages believe an improvement in margins from these store additions could help ease the margin pressure for Medplus going forward.

  1. One97 Communications (Paytm): It is not a ‘Happy anniversary’ for this internet software company as the stock lost more than 70% of its price value in the last year. Trendlyne’s technicals suggest that Paytm fell over 42% in the last three months alone. While looking at the financials, Paytm’s Q2FY23 results have been encouraging as its net loss narrowed to Rs 588.8 crore in Q2FY23, compared to Rs 628 crore in Q1FY23. Revenue also grew by 10.6% QoQ to Rs 1,490.2 crore, with the most revenue coming in from payment services given to merchants.

What triggered the decline was the end of the lock-in period for pre-IPO investors, which ended on November 15. The first investor to offload a stake in the company was Societe Generale, cutting a 0.06% stake in the company for Rs 23.2 crore in a bulk deal. The stock fell 4% in trade after the deal but the bigger cut was by SVF India Holdings, a subsidiary of Softbank. SVF India sold a 4.5% stake (worth Rs 1,630.8 crore) in Paytm on November 17, which caused the stock to crash more than 10% in trade. It now holds a 12.9% stake in Paytm, compared to 17.4% earlier. Although other funds like BNP Paribas Arbitrage, BofA Securities Europe and Morgan Stanley picked up nearly 2.8% stake in Paytm, the investor sentiment is yet to turn positive on the stock.

To add to this, Macquarie said that Jio Financial Services’ foray into the payment provider space may add to the problems of Paytm. The stock fell 11% on Tuesday on the fresh speculation. Suresh Ganapathy, an analyst at Macquarie, says that although Jio Financial Services has not declared the segments it plans to target, it will be focused on customer and merchant lending. It may prove to be a threat to not only Paytm, but also NBFC players like Bajaj Finance. Trendlyne’s consensus recommendation suggests that six analysts recommend a ‘Buy’ while two recommend a ‘Hold’ and ‘Sell’.

  1. Escorts Kubota: This commercial vehicle manufacturer’s stock rose 8% till Thursday since holding its analyst & investor meet on Friday. The upward price movement enabled this company to show up in a screener for stocks with strong momentum where their prices are above the short, medium, and long-term moving averages.

The positive price movement comes on the back of the street’s healthy business outlook for the company after it unveiled its medium-term business plan. The company aims to increase its revenue 2.5X by FY28 and increase the contribution of its exports towards the revenue to 15-20% from 6.4% in FY22. Overall, the management aims to increase the firm’s revenue by expanding its network and production capacity, gaining market share and increasing exports. The company is targeting the key high-volume export markets of US, Europe, Thailand and Brazil. Another element of the management’s medium-term strategy is to increase its dividend payout and buybacks by using up to 40% of its net profit.

To carry out its medium-term business plans, the management has planned a capex of Rs 4,000 crore. This will be spent on greenfield expansion, repaying the debt of the merged entity, and new product launches. The company plans to build a new manufacturing facility to increase its production capacity of tractors and engines by 76.5% to 3 lakh units by FY28. The management also aims to ramp up its distribution network by 50% from its current network of about 1,400 dealers. Although Escorts Kubota has laid out a positive trajectory for itself, effective execution will be key in realising its growth potential in the coming quarters.

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

 
Trendlyne Marketwatch
Trendlyne Marketwatch
25 Nov 2022
Market closes marginally higher, Adani Enterprises to raise Rs 20,000 crore

Trendlyne Analysis

Nifty 50 closed marginally higher after dipping into losses and gains throughout the day. European stocks traded mixed as investors digested the latest German quarterly GDP data, which grew 0.4% QoQ. Major Asian indices closed mixed as investors assessed rising Covid cases in China and its impact on global economy. Tokyo’s core consumer price index rose 3.6% in November, its highest annual pace since 1980. US markets were closed on Thursday on account of Thanksgiving day. Crude oil is set for its third consecutive weekly loss as traders assess price capping on Russian oil by G7 countries and rising Covid cases in China.

Nifty Smallcap 100 and Nifty Midcap 100 closed in the green, despite the benchmark index closing marginally higher. Nifty Media and Nifty Auto closed higher than Thursday’s close. Nifty IT closed in the green after rising over 2.6% higher on Thursday.

Nifty 50closed at 18,512.75 (28.7, 0.2%), BSE Sensexclosed at 62,293.64 (21.0, 0.0%) while the broader Nifty 500closed at 15,727.25 (46.5, 0.3%)

Market breadth is in the green. Of the 1,938 stocks traded today, 1,182 were on the uptick, and 697 were down.

  • The Government of India is looking to sell a 5-10% stake in Coal India, Hindustan Zinc and Rashtriya Chemicals & Fertilizers, according to reports. The proceeds from these stake sales are expected to fund the Centre’s subsidy bill.

  • Adani Enterprises' board of directors approves the raising of funds by way of further public offering through a fresh issue of equity shares aggregating up to Rs 20,000 crore, subject to shareholders' approval.

  • Money Flow Index (MFI) indicates that stocks like NBCC (India), The Fertilisers and Chemicals Travancore, Indoco Remedies and Rashtriya Chemicals & Fertilizersare in the overbought zone.

  • High-return durable stocks like HCL Technologies, Hindustan Aeronauticsand Kalyan Jewellersgain more than 18% in the past 90 days.

  • ICICI Securities maintains 'Add' rating on Brookfield India REIT with a target price of Rs 318. This indicates a potential upside of 9.6%. The brokerage believes that the company's sponsor right of first offer (RoFO) of 6.4 marginal standing facility (MSF) across Gurugram in NCR and Powai in Mumbai may drive inorganic growth. It expects the company's net profit to grow at a CAGR of 21.8% over FY22-25.

  • Larsen & Toubroand Hindustan Aeronauticshit all-time highsof Rs 2,095.8 and Rs 2,774.95 respectively. Both stocks rise for two consecutive sessions.

  • Hariom Pipe Industries touches a 52-week high of Rs 319.9 as it finishes instalment of a 15-tonne electric melting furnace and begins commercial production today. This will increase the plant’s production to 1.04 lakh MTPA from 95,832 MTPA. It shows up in a screener listing stocks with improving RoCE for the past two years.

  • Nomura is cautious of the share-price rally and downgrades its rating on Siemens to ‘Neutral’ with a target price of Rs 3,008. The brokerage expects order inflow to reduce.

  • Media stocks like Network 18 Media & Investments, TV18 Broadcast, Dish TV India, PVR and Inox Leisure are rising in trade. The broader sectoral index Nifty Media is also trading in the green.

  • Investment Advisor Sandip Sabharwal is bullish on tyre stocks as global rubber prices ease. He says that tyre  companies will benefit from a fall in crude oil prices and a correction in rubber prices. Tyre stocks like Balkrishna Industries, MRF, Apollo Tyres and Ceat are rising in trade today.

  • AstraZeneca Pharma, Fine Organic Industries and Great Eastern Shipping Co report an increase in net profit by more than 2.5X YoY in Q2FY23.

  • Castrol India inks an agreement with Ki Mobility Solutions for acquiring of 7.1% stake for Rs 487.5 crore. Both companies will explore business and technology collaborations under this partnership.

  • Chennai Petroleum Corp and Indian Oil Corp are rising as they sign a joint venture (JV) agreement with seed investors for a refinery and petrochemicals project. The refineries will set up a nine million metric tonne facility in Tamil Nadu. Chennai Petroleum and Indian Oil will hold 25% of equity each in the JV, while the remaining 50% will be held by seed investors.

  • Keynote Capitals initiates coverage on Can Fin Homes with a ‘Buy’ rating and a target price of Rs 670. This indicates an upside of 27.4%. The brokerage has a healthy business outlook for the company given its robust asset quality, healthy growth in loan disbursements and effective risk management. It expects the firm’s loan book to grow 18-20% in the coming quarters and net profit at a CAGR of 17.6% over FY22-24.

  • Saurabh Gupta, Group CFO of Dixon Technologies, expects the company’s revenue to be around Rs 14,000-15,000 crore in FY23. He also expects 35% of revenue to come in from exports.

  • Biocon is rising after its wholly owned subsidiary Biocon Biologics allots shares worth Rs 2,205.6 crore to the company. This takes the holding of Biocon in Biocon Biologics to 88.8% post the allotment of shares.

  • Stocks like Punjab National Bank, Suzlon Energy and IDBI Bank trade above their second resistance or R2 level as the market trades flat.

  • Tata Steel Long Products acquires an additional 4.69 crore shares of its subsidiary Neelachal Ispat Nigam for Rs 300 crore. The stock shows up on a screener for companies with improving cash flow from operations over the past two years.

  • PSU bank stocks like Punjab National Bank, UCO Bank, Punjab & Sind Bank and Indian Overseas Bank are rising in trade. The broader sectoral index Nifty PSU Bank is also trading in the green.

  • BofA maintains its ‘Buy’ rating on PVR with a target price of Rs 2,405. The brokerage says that Q3FY23 will be a strong quarter as the pipeline of movie releases is favourable.

  • Lupin is falling after the US FDA issued Form 483 with eight observations each for the drug product and API facility. The inspection was conducted at Lupin’s Mandideep facility in Madhya Pradesh.

  • Punjab National Bank is rising as it receives government nod to divest its entire stake in UTI Asset Management Co. The bank holds a 15.2% stake in UTI Asset Management. It is yet to receive approval from the Securities and Exchange Board of India.

  • WF Asian Smaller Companies Fund buys 1.6 crore shares (2.05% stake) in PB Fintech for Rs 271 crore in a bulk deal. Meanwhile, Capri Global Holdings buys 6.06 lakh shares (0.73% stake) in Fino Payments Bank for Rs 15.6 crore in another bulk deal.

Riding High:

Largecap and midcap gainers today include Bharat Heavy Electricals Ltd. (81.95, 9.56%), Tata Motors Limited (DVR) (234.70, 9.14%) and PB Fintech Ltd. (460.55, 6.61%).

Downers:

Largecap and midcap losers today include Union Bank of India (76.50, -2.67%), Shriram Transport Finance Company Ltd. (1,280.15, -2.41%) and Bajaj Holdings & Investment Ltd. (6,371.80, -2.29%).

Volume Rockets

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

Top high volume gainers on BSE included Indiabulls Housing Finance Ltd. (138.15, 11.64%), Bharat Heavy Electricals Ltd. (81.95, 9.56%) and Tata Motors Limited (DVR) (234.70, 9.14%).

Top high volume losers on BSE were ICICI Prudential Life Insurance Company Ltd. (452.10, -2.14%), Heidelberg Cement India Ltd. (195.50, -1.16%) and Sapphire Foods India Ltd. (1,330.00, -0.57%).

Sanofi India Ltd. (5,689.50, 3.47%) was trading at 9.9 times of weekly average. EPL Ltd. (161.85, 5.03%) and JM Financial Ltd. (73.45, 3.31%) were trading with volumes 9.5 and 8.7 times weekly average respectively on BSE at the time of posting this article.

BSE 500: highs, lows and moving averages

22 stocks overperformed with 52-week highs, while 2 stocks were underachievers and hit their 52-week lows.

Stocks touching their year highs included - Aegis Logistics Ltd. (336.20, 1.83%), Bank of Baroda (167.85, -1.50%) and Bank of India (81.80, 0.62%).

Stocks making new 52 weeks lows included - Motilal Oswal Financial Services Ltd. (655.00, -0.68%) and Quess Corp Ltd. (422.85, -0.18%).

24 stocks climbed above their 200 day SMA including Indiabulls Housing Finance Ltd. (138.15, 11.64%) and Gujarat State Petronet Ltd. (278.80, 7.05%). 7 stocks slipped below their 200 SMA including Adani Transmission Ltd. (2,739.60, -1.84%) and Aptus Value Housing Finance India Ltd. (313.30, -0.52%).

 
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The Baseline
24 Nov 2022
Chart of the Week: India’s trade deficit grows as merchandise exports fall
By Abdullah Shah

India’s trade deficit widened to $14.6 billion in October 2022, the highest since June 2020. A major reason for this was the 16.7% YoY fall in merchandise exports to $29.8 billion. It was the first such decline in exports in the past 19 months. Demand fell across the US and EU markets, while the festive season in India slowed domestic production. In this edition of chart of the week, we take a look at the merchandise sectors which had the most impact on imports and exports.

The electronic goods sector is the only major sector which saw a rise in exports in October. It grew 37.6% YoY to $1.8 billion. The engineering goods sector fell 21.3% YoY in exports and contributed $7.4 billion (nearly 25%) to  merchandise exports in October. Export of handloom products fell the most by 46.2% YoY to $719 million, while  it was down 11.3% YoY to $4.7 billion for petroleum products. 

Although exports fell, merchandise imports rose by a small margin of 5.7% YoY to $56.7 billion in October. Biggest contributor to this rise in imports was the petroleum, crude & products sector – up 29.1% YoY and contributed $15.9 billion. On the contrary, the gold sector imports fell the most by 27.5% YoY to $3.7 billion, while the electronic goods sector declined 9.2% YoY to $6.2 billion. 

 
Trendlyne Marketwatch
Trendlyne Marketwatch
24 Nov 2022
Market closes higher, Capri Global Holdings buys 1.59% stake in Fino Payments Bank

Trendlyne Analysis

Indian indices rose sharply during the final hour of the trading session and closed in the green. BSE Sensex touched its life-time high and closed 1.2% higher. European stocks followed the global trend and traded higher than Wednesday's close. Major Asian indices closed in the green, in line with the US indices, which closed higher on Wednesday.

US stocks rose as the US Federal Open Market Committee (FOMC) Meeting Minutes showed that interest rate hikes may slow down going forward. The S&P 500 index closed 0.6% higher and touched a two-month high while the tech-heavy NASDAQ 100 index rose 1%. Brent crude oil futures traded marginally higher after falling over 4% on Wednesday as rising Covid cases in China hurt crude oil demand.

Nifty Smallcap 100 and Nifty Midcap 100 closed in the green, following the benchmark index. Nifty FMCG and Nifty Bank closed higher than Wednesday’s close. Nifty IT closed in the green, taking cues from the tech-heavy NASDAQ 100, which closed nearly 1% higher on Thursday.

Nifty 50closed at 18,484.10 (216.9, 1.2%), BSE Sensexclosed at 62,272.68 (762.1, 1.2%) while the broader Nifty 500closed at 15,680.80 (142.7, 0.9%)

Market breadth is in the green. Of the 1,938 stocks traded today, 1,061 were on the uptrend, and 811 went down.

  • Relative strength index (RSI) indicates that stocks like Indian Railway Finance Corp, Union Bank of India, NBCC (India) and IIFL Financeare in the overbought zone.

  • Easy Trip Planners rises in trade after it announces a board meeting on December 1 to consider a proposal on acquisition. The stock shows up in a screener with improving RoA for the past two years.

  • KPI Green Energyis rising as its shareholders will consider the issuance of bonus shares at its board meeting on Wednesday. The company shows up in a screenerlisting stocks with improving book value per share for the past two years.

  • IOL Chemicals and Pharmaceuticals rises as the Centre grants it a patent for developing a safe process to prepare drugs used to treat high blood pressure and heart failure. It shows up in a screener for companies with improving book value per share for the past two years.

  • Aurobindo Pharma and Quess Corp hit their 52-week lows of Rs 456.6 and Rs 423.3 respectively. Aurobindo Pharma falls for seven consecutive sessions, while Quess Corp trades lower for two sessions.

  • Fino Payments Bank is rising after Capri Global Holdings buys a 1.59% stake (13.2 lakh shares) worth Rs 30.2 crore in a bulk deal. The company shows up on a screener with stocks rising more than 20% in the past month.

  • Indian Oil Corp and Chennai Petroleum Corp rise as ICICI Bank plans to invest in the seed equity capital of the proposed joint venture (JV) of the oil corporations. ICICI Bank will hold a 10% stake in the JV. As a seed equity investor, the bank does not have any obligation to fund the future equity requirements of the project.

  • PB Fintech (Policybazaar) is surging in trade as 73.4 lakh shares (1.6% equity) amounting to Rs 295 crore change hands, according to reports.

  • Brokerage firm Ambit recommends a ‘Buy’ rating on Zomato with a target price of Rs 94, indicating an upside of 50%, according to reports. It is optimistic about the company’s growth as Zomato's market share in the food delivery space rose to 55% in H1CY22. The company’s gross merchandise value in food ordering in H1CY22 stands at 56%, beating Swiggy’s 40%. The brokerage expects the entire enterprise (including Blinkit) to turn profitable by FY27.

  • Larsen & Toubro's heavy civil infrastructure business wins an order worth Rs 1,000-2,500 crore from the Greenko Group for the development of an off-stream pumped storage project in Madhya Pradesh.

  • Neeraj Kanwar, Managing Director of Apollo Tyres, says that the company’s volumes rose 9%. He adds that it aims to expand India business margins to 12% as raw material prices ease and new products are introduced in the market.

  • IT consulting & software companies like Persistent Systems, HCL Technologies, Larsen & Toubro Infotech, Infosys and Tech Mahindra are rising in trade. All the constituents of the broader Nifty IT index are trading in the green.

  • Cipla is falling as the US FDA issues an Official Action Indicated (OAI) status to its manufacturing facility in Goa. The OAI status generally means that the regulatory found objectionable conditions during inspections. The US FDA will hold further product approvals for the Goa facility until the observations are resolved.

  • Delhivery is rising as 32.1 lakh shares (0.44% equity) amounting to Rs 104.8 crore change hands, according to reports.

  • ICICI Securities maintains its ‘Buy’ rating on Balkrishna Industries with a target price of Rs 2,479. This implies an upside of 26.5%. The brokerage is positive about the company’s prospects given its lower input costs compared to its peers and its focus on exports. It expects the company’s revenue to grow at a CAGR of 16% over FY22-24.

  • Healthcare stocks like Global Health, Apollo Hospitals Enterprise, and Aster DM Healthcare are rising in trade. The broader Healthcare Facilities industry improves by more than 2%.

  • Sugar stocks like Shree Renuka Sugars, EID (Parry) India, Balrampur Chini Mills and Triveni Engineering & Industries are rising in trade. The Indian Sugar Mills Association suggests that the companies will be allowed to export an additional 2-4 million tonnes this season, according to reports. The broader sugar industry is also up by more than 2% in trade.

  • Tata Consumer Products is rising as the company plans to buy Bisleri International for Rs 7,000 crore, according to reports. The company features in a screener of stocks with improving return on capital employed (RoCE) for the past two years.

  • Keystone Realtors’ shares list at a 2.6% premium to the issue price of Rs 541 on its debut on the bourses. The Rs 635 crore IPO was subscribed for 2X the total shares on offer.

  • Glenmark Pharma is falling after the US FDA issued a warning letter to its Goa manufacturing facility. The unit was given an official action indicated (OAI) status after an inspection in May 2022.

  • Polus Global Fund sells a 2.3% stake (53.8 lakh shares) in the recently listed IPO, Inox Green Energy, for Rs 32.9 crore in a bulk deal. Meanwhile, Pilot Consultants picks up a 2.45% stake (57.6 lakh shares) in the company for Rs 34.9 crore in another bulk deal.

Riding High:

Largecap and midcap gainers today include PB Fintech Ltd. (432.00, 7.89%), Indian Railway Finance Corporation Ltd. (30.90, 5.64%) and Apollo Hospitals Enterprise Ltd. (4,815.05, 4.56%).

Downers:

Largecap and midcap losers today include Indian Overseas Bank (22.05, -4.55%), One97 Communications Ltd. (441.10, -2.50%) and Vodafone Idea Ltd. (8.05, -2.42%).

Volume Rockets

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

Top high volume gainers on BSE included SJVN Ltd. (38.90, 7.31%), Indoco Remedies Ltd. (415.35, 7.19%) and Avanti Feeds Ltd. (391.55, 7.17%).

Top high volume losers on BSE were Happiest Minds Technologies Ltd. (941.00, -2.13%), Alembic Pharmaceuticals Ltd. (599.75, -1.73%) and Gillette India Ltd. (5,001.10, -1.46%).

Cera Sanitaryware Ltd. (5,506.25, 2.96%) was trading at 24.4 times of weekly average. Welspun India Ltd. (80.35, 4.96%) and Mangalore Refinery And Petrochemicals Ltd. (56.05, 6.05%) were trading with volumes 12.4 and 11.7 times weekly average respectively on BSE at the time of posting this article.

BSE 500: highs, lows and moving averages

20 stocks took off, crossing 52-week highs, while 9 stocks hit their 52-week lows.

Stocks touching their year highs included - Aegis Logistics Ltd. (330.15, 0.15%), Bank of Baroda (170.40, 0.92%) and Bank of India (81.30, 2.46%).

Stocks making new 52 weeks lows included - Aurobindo Pharma Ltd. (456.30, -0.73%) and Avanti Feeds Ltd. (391.55, 7.17%).

18 stocks climbed above their 200 day SMA including Gujarat State Petronet Ltd. (260.45, 9.50%) and HDFC Life Insurance Company Ltd. (572.55, 4.55%). 6 stocks slipped below their 200 SMA including Adani Transmission Ltd. (2,790.85, -2.31%) and Aarti Drugs Ltd. (442.30, -2.25%).

 
Trendlyne Marketwatch
Trendlyne Marketwatch
23 Nov 2022
Market closes flat, Goldman Sachs expects Nifty 50 to reach 20,500-mark by 2023

Trendlyne Analysis

Indian indices closed flat with the Nifty 50 closing below the 18,300 mark. European indices traded higher than Tuesday’s levels. Major Asian indices closed in the green, in line with the US indices, which closed higher on Tuesday. Retail and energy stocks helped US indices to close in the green. The S&P 500 index closed 1.4% higher and touched a two-month high while the tech-heavy NASDAQ 100 rose 1.5%. Investors look ahead to the US Federal Open Market Committee (FOMC) Meeting Minutes to be released later today. Brent crude oil futures trade flat after rising 0.8% on Tuesday as US crude inventory fell by more than expected last week, raising supply concerns.

Nifty Smallcap 100 closed in the green, despite the benchmark index closing flat. Nifty Media and Nifty Bank closed higher than Tuesday’s levels. Nifty IT closed in the red, despite the tech-heavy NASDAQ 100, closing in the green on Tuesday.

Nifty 50closed at 18,267.25 (23.1, 0.1%), BSE Sensexclosed at 61,510.58 (91.6, 0.2%) while the broader Nifty 500closed at 15,538.15 (29.0, 0.2%)

Market breadth is in the green. Of the 1,932 stocks traded today, 1,048 were on the uptrend, and 830 went down.

  • Money Flow Index (MFI) indicates that stocks like Bank of Maharashtra, Union Bank of India, Amara Raja Batteries and NBCC (India) are in the overbought zone.

  • Fertilizer stocks like Rashtriya Chemicals & Fertilizers, The Fertilisers and Chemicals Travancore, Gujarat Narmada Valley Fertilizers & Chemicals and Chambal Fertilisers & Chemicals are rising in trade. The broader sector of fertilizers is also trading in the green.

  • Goldman Sachs expects the Nifty 50 index to reach the 20,500 mark by the end of 2023. It added that RBI’s repo rate could be at 6.75% by February 2023.

  • Trendlyne’s Forecaster Dashboard suggests stocks like Phoenix Mills, Ircon International and Petronet LNG to have the highest capex growth in FY23.

  • Canara Bank and IIFL Finance hit their 52-week highs of Rs 326.3 and Rs 475 respectively. While Canara Bank rises for five consecutive sessions, IIFL Finance trades higher for three sessions.

  • KPIT Technologies rises after announcing that Renault Group selected it as a strategic software scaling partner for its next-generation software-defined vehicle programme. The stock shows up on the screener for companies with revenue increasing sequentially for the past eight quarters.

  • M Anandan, Chairman and Managing Director of Aptus Value Housing Finance, says that the company aims to maintain a 25-30% CAGR in loan growth. He adds that NPAs will be at 1% in the upcoming quarters.

  • Tata Teleservices (Maharashtra) rises as it announces a strategic expansion of its cloud communication suite Smartflo with WhatsApp Business Platform to offer enhanced business communication solutions.

  • Aurobindo Pharma is rising as its step-down subsidiary Acrotech Biopharma signs a licensing agreement with Evive Biotech to commercialise Ryzneuta in the US market. The product is used for post-treatment of cancer patients after they go through chemotherapy.

  • BASF India's Managing Director Narayan Krishnamohan and Whole-Time Director Rajesh Naik resign from the company, effective from December 31. The company appoints Alexander Gerding as the Managing Director and Anil Kumar Choudhary as the Whole-time Director, subject to the approval of the shareholders.

  • Trent is rising as 0.2% equity amounting to Rs 100.4 crore change hands in a block deal, according to reports.

  • FSN E-Commerce Ventures (Nykaa) is falling as Chief Financial Officer Arvind Agarwal resigns from the company to pursue other opportunities in the digital economy and start-up space. His resignation will be effective from November 25.

  • DCW surges after announcing plans to expand the capacity of its Chlorinated Polyvinyl Chloride (CPVC) and Synthetic Iron Oxide Pigment (SIOP) plants to 100%. The company expects to double CPVC production capacity by H2FY24 and increase SIOP capacity utilisation by Q1FY24. It will invest around Rs 125 crore towards this.

  • Lighthouse India Fund sells an additional 0.65% stake (1.8 crore shares) in FSN E-Commerce Ventures (Nykaa) for Rs 335.7 crore in a bulk deal. Meanwhile, Catalyst Trusteeship sold a 1.56% stake (54 lakh shares) in Max Financial Services worth Rs 344.1 crore in a bulk deal.

  • Citi maintains its ‘Sell’ rating on Vedanta with a target price of Rs 235. This comes after the company’s board announced a third interim dividend for FY23. The brokerage says that dividend yield might be insufficient if there is a fall in commodity prices.

  • Bharti Airtel’s arm Nxtra Data starts construction of its hyper-scale data centre in Kolkata. The company plans to invest Rs 600 crore towards the development and construction of the centre. The stock makes it to the screener for companies with improving cash flow from operations over the past two years.

  • Indian rupee falls to 81.8 from the previous close of 81.67 against the US dollar in early trade today.

  • Anil Gupta, promoter of KEI Industries, sells a 0.2% stake amounting to Rs 32.1 crore in the company. He now holds a 12.4% stake in the company.

  • Inox Green Energy Services’ shares list at a 7.7% discount to the issue price of Rs 65 on its debut on the bourses. The Rs 740 crore IPO was subscribed for 1.5X the total shares on offer.

  • Gland Pharma, Go Fashion (India) and Sumitomo Chemical underperform the Nifty 50 index by more than 15% in the past month post its results.

  • Siemens’ Q4FY22 (financial year followed is October – September) net profit jumps 2X YoY to Rs 652.3 crore. It had exceptional gains of Rs 355 crore from the divestment of its large drives application business by its subsidiary. Revenue rose 10.9% YoY because of an increase in new orders in Q4. The company shows up on the screener listing stocks with high TTM EPS growth.

Riding High:

Largecap and midcap gainers today include Punjab National Bank (50.35, 4.46%), InterGlobe Aviation Ltd. (1,893.35, 4.09%) and Apollo Hospitals Enterprise Ltd. (4,605.20, 3.03%).

Downers:

Largecap and midcap losers today include Hindustan Zinc Ltd. (301.05, -5.79%), One97 Communications Ltd. (452.40, -5.12%) and Schaeffler India Ltd. (2,943.00, -3.56%).

Volume Rockets

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

Top high volume gainers on BSE included RHI Magnesita India Ltd. (795.90, 12.96%), Rashtriya Chemicals & Fertilizers Ltd. (116.30, 11.51%) and NBCC (India) Ltd. (41.65, 10.48%).

Top high volume losers on BSE were Shriram City Union Finance Ltd. (1,992.65, -1.50%) and Siemens Ltd. (2,769.75, -1.20%).

Edelweiss Financial Services Ltd. (63.90, 6.95%) was trading at 16.3 times of weekly average. AstraZeneca Pharma India Ltd. (3,375.10, 3.81%) and Rallis India Ltd. (239.25, 4.32%) were trading with volumes 11.7 and 8.8 times weekly average respectively on BSE at the time of posting this article.

BSE 500: highs, lows and moving averages

19 stocks overperformed with 52-week highs, while 15 stocks were underachievers and hit their 52-week lows.

Stocks touching their year highs included - Aegis Logistics Ltd. (329.65, 3.34%), Bank of Baroda (168.85, 1.26%) and Bank of India (79.35, -1.37%).

Stocks making new 52 weeks lows included - Avanti Feeds Ltd. (365.35, -2.91%) and GlaxoSmithKline Pharmaceuticals Ltd. (1,300.00, -0.68%).

11 stocks climbed above their 200 day SMA including Sun Pharma Advanced Research Company Ltd. (253.60, 4.36%) and InterGlobe Aviation Ltd. (1,893.35, 4.09%). 3 stocks slipped below their 200 SMA including Thermax Ltd. (2,076.00, -2.56%) and L&T Technology Services Ltd. (3,815.60, -1.04%).

 
Trendlyne Marketwatch
Trendlyne Marketwatch
22 Nov 2022
Market closes higher, realty stocks fall in trade

Trendlyne Analysis

Indian indices closed in the green with the Nifty 50 closing above the 18,200 mark. European indices traded higher than Monday’s close. Most major Asian indices closed higher after falling on Monday as investors remained wary of rising Covid cases in China, which announced its first new Covid-related death in nearly six months. This could give way to a new wave of lockdowns, leading to economic slowdown. As a result, US indices also closed in the red on Monday.

The S&P 500 index fell 0.4%, led by Tesla, which closed over 6.8% lower after hitting a new two-year low during intraday. However, the Dow Jones closed flat, helped by a 6.3% rise in Disney shares as the company replaced CEO Bob Chapek with his predecessor, Bob Iger. Brent crude oil futures recovered over $5 from its day's low but still closed in the red on Monday. Crude oil prices bounced back after Saudi Arabia denied reports of OPEC+ considering an oil output hike of 500,000 barrels per day.

Nifty Midcap 100 closed in the green, following the benchmark index. Nifty Media and Nifty Bank closed higher than Monday’s levels. Nifty IT closed higher, despite the tech-heavy NASDAQ 100 closing over 1% lower on Monday.

Nifty 50closed at 18,244.20 (84.3, 0.5%), BSE Sensexclosed at 61,418.96 (274.1, 0.5%) while the broader Nifty 500closed at 15,509.20 (55.4, 0.4%)

Market breadth is in the red. Of the 1,940 stocks traded today, 866 showed gains, and 1,015 showed losses.

  • Relative strength index (RSI) indicates that stocks like Bank of Maharashtra, Indian Railway Finance Corp, Union Bank of India and Hindustan Zinc are in the overbought zone.

  • FSN E-Commerce Ventures (Nykaa) falls over 3% in trade as reports suggest that Lighthouse India likely offloaded 1.8 crore shares in a block deal.

  • Easy Trip Planners hits an all-time high of Rs 67.3 after it inks a memorandum of understanding with Assam Tourism Development Corp to share resources and collaborate to boost the growth of tourism in Assam.

  • Steel Strips Wheels rises as it signs an MoU with Israel-based Redler Technologies. The MoU pertains to the establishment of a joint venture undertaking to focus on the development, manufacturing and marketing of motion control solutions for two, three and four-wheeled electric vehicles.

  • India’s domestic air passenger traffic rises 27% YoY in October. Market share for Indigo, Vistara and Air India fell MoM in October, while Air Asia gained.

  • Stocks like IndusInd Bank, GAIL (India), Trentand Indian Railway Finance Corptrade above their second resistance or R2 levelas the market trades higher.

  • Realty stocks like Macrotech Developers, Indiabulls Real Estate, Phoenix Mills and Brigade Enterprises are falling in trade. The broader sectoral index Nifty Realty is also trading in the red.

  • Trendlyne’s Forecaster estimates weak revenue growth for State Bank of India, Power Grid Corp and HDFC Life Insurance in FY23.

  • Yes Securities maintains its ‘Buy’ rating on Aarti Industries with a target price of Rs 845, indicating an upside of 25.4%. The brokerage is positive about the company’s future growth prospects given its capacity expansion plans, ramp-up in operations and new product launches. It expects the company’s revenue to grow at a CAGR of 10.4% over FY22-25.

  • Reliance Jio gains 7.2 lakh wireless subscribers in September on a net basis, while Bharti Airtel adds a net 4.1 lakh subscribers. Vodafone Idea loses 40.1 lakh subscribers.

  • Raymond, ABB India and Oil India have a Trendlyne Durability score of above 80 and EPS TTM growth of more than 100%.

  • One97 Communications (Paytm) falls and touches a 52-week low of Rs 484.5. Reports suggest that rampant selling by foreign investors because of the end of the anchor lock-in period is the reason for the stock to fall. It shows up on a screener of bearish stocks with low to medium Trendlyne Momentum Score.

  • Crude oil prices reverse overnight losses after Saudi Arabia denies news of a possible output rise by OPEC+. Brent crude fell to $82.5 before rising to $87.6 per barrel in trade. Crude oil prices fell amid reports that OPEC+ will consider increasing output to 5 lakh barrels per day.

  • Jubilant Foodworks' arm Jubilant FoodWorks International Luxembourg approves incorporation of a wholly owned subsidiary company in Nepal. The to-be-named subsidiary shall have the exclusive right to develop and operate Domino‘s Pizza stores in the territory of Nepal.

  • ICICI Securities upgrades Bharti Airtel to 'Buy' rating from 'Add' with a target price of Rs 970, according to reports. This indicates an upside of 13.8%. The brokerage believes that the company's recent price hikes in Haryana and Odisha will raise the average revenue per unit (ARPU) to Rs 300 from Rs 190 in Q2FY23.

  • JK Paper is rising as it is set to acquire two paper & packaging board companies, Horizon Packs and Securipax Packaging, for Rs 578 crore. It will acquire an 85% stake in both companies now and the remaining 15% in three years. The company believes that this will enable the expansion of its corrugated packaging business.

  • CB Ananthakrishnan, Director (Finance) and CFO of Hindustan Aeronautics, says that the EBITDA margin guidance is at 26-27% for FY23, compared to the earlier 24-25%. He expects revenue growth of 8% during FY23 and FY24.

  • Kaynes Technology’s shares list at a 32.5% premium to the issue price of Rs 587 on its debut on the bourses. The Rs 857.8 crore IPO was subscribed for 34.2X the total shares on offer.

  • Public holder Dharampal Satyapal sells a 0.14% stake (25 lakh shares) in Easy Trip Planners for Rs 13.5 crore in a bulk deal, while Saint Capital Fund picks up a 0.13% stake (22 lakh shares) for Rs 11.5 crore.

  • CA Swift Investments sells a 2.5% stake (1.8 crore shares) in Delhivery worth Rs 607.4 crore in a bulk deal. In another deal, Morgan Stanley Asia picks up a 0.67% stake (48.5 lakh shares) in Delhivery for Rs 160.2 crore.

Riding High:

Largecap and midcap gainers today include Varun Beverages Ltd. (1,155.20, 4.70%), Bank of India (80.45, 4.35%) and The New India Assurance Company Ltd. (95.55, 3.69%).

Downers:

Largecap and midcap losers today include One97 Communications Ltd. (476.80, -11.21%), Adani Transmission Ltd. (2,875.15, -4.76%) and FSN E-Commerce Ventures Ltd. (175.20, -4.52%).

Volume Rockets

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

Top high volume gainers on BSE included Easy Trip Planners Ltd. (68.40, 19.37%), UCO Bank (20.95, 12.33%) and Mazagon Dock Shipbuilders Ltd. (866.75, 12.01%).

Top high volume losers on BSE were Vakrangee Ltd. (28.40, -8.09%), Avanti Feeds Ltd. (378.00, -4.91%) and Max Financial Services Ltd. (644.80, -1.67%).

UTI Asset Management Company Ltd. (683.75, 0.24%) was trading at 16.4 times of weekly average. Torrent Power Ltd. (530.05, 0.93%) and Gujarat State Petronet Ltd. (238.15, 1.25%) were trading with volumes 6.6 and 5.5 times weekly average respectively on BSE at the time of posting this article.

BSE 500: highs, lows and moving averages

20 stocks hit their 52-week highs, while 14 stocks hit their 52-week lows.

Stocks touching their year highs included - Bank of India (80.45, 4.35%), Bank of Maharashtra (27.85, -3.30%) and Bharti Airtel Ltd. (847.60, -0.42%).

Stocks making new 52 weeks lows included - Avanti Feeds Ltd. (378.00, -4.91%) and Johnson Controls-Hitachi Air Conditioning India Ltd. (1,066.00, -3.39%).

13 stocks climbed above their 200 day SMA including Prism Johnson Ltd. (120.25, 3.53%) and Glenmark Pharmaceuticals Ltd. (422.40, 2.61%). 12 stocks slipped below their 200 SMA including Indiabulls Real Estate Ltd. (80.80, -4.09%) and Bajaj Electricals Ltd. (1,074.00, -1.72%).

 
logo
The Baseline
21 Nov 2022
Five rising stocks with analyst ‘Buy’ calls
By Abhiraj Panchal

We take a look at five stocks that have been rising over 5% in the past month, with analyst ‘Buy’ calls.

  1. Oil And Natural Gas Corp: HDFC Securities maintains its ‘Buy’ rating on this oil & gas exploration & production company with a target price of Rs 169. This indicates an upside of 24.8%. In Q2FY23, the company’s net profit fell 54% YoY to Rs 8,299.4 crore and revenue rose 38.2% YoY.  

Analysts Harshad Katkar, Nilesh Ghuge, Akshay Mane and Rutvi Chokshi are positive about the company due to an improvement in crude oil realisations and domestic gas price realisations. 

The analysts were also positively surprised by the firm’s standalone Q2FY23 results, as it beat their net profit estimates. They attribute this outperformance to “lower-than-expected statutory levies, lower employee cost, lower depreciation, depletion & amortisation costs and higher other income”. The analysts find the management’s crude oil and gas production guidance for FY23, FY24 and FY25 encouraging. They expect the company’s revenue to grow at a CAGR of 10.6% over FY22-25.

  1. Hindustan Aeronautics: ICICI Direct maintains its ‘Buy’ rating on this defence company with a target price of Rs 3,300. This indicates an upside of 24.3%. In Q2FY23, its net profit rose 44.2% YoY to Rs 1,221.2 crore despite its revenue declining 7.3% YoY. 

Analysts Chirag Shah and Vijay Goel said the firm’s EBITDA margins also grew by 919 bps YoY to 31.5%. They attributed the improvement in profitability and margins to lower other costs and a higher share of revenue contribution from the maintenance, repair & overhaul (MRO) segment.  

Shah and Goel believe the company’s revenue growth in the coming quarters will be driven by its healthy order book, which stands at Rs 83,800 crore. They also expect a continuous order inflow in the MRO segment to bolster the order pipeline. The analysts added that “execution of other key orders and sustained growth in MRO will drive revenue growth in double digits from FY25”. They estimate the company’s net profit to grow at a CAGR of 11.8% over FY23-25.    

  1. Bharat Forge: Prabhudas Lilladher reiterates its ‘Buy’ call on this forging company with a target price of Rs 950, indicating an upside of 14.9%. The stock price rose by 6.4% during the past month. The company’s net profit in Q2FY23 fell by 46.2% YoY to Rs 145.9 crore despite a 28.1% YoY rise in revenue to Rs 3,122.3 crore. According to analyst Mansi Lall, the poor performance was caused by high raw material costs and a one-time charge of Rs 13 crore on a defence business. 

Bharat Forge won export orders for passenger vehicles and industrial segments, as well as a defence export order worth $155 million for artillery products to be executed over the next three years. Lall said, “The management highlighted that near-term demand for commercial vehicles looks positive in both India and export markets.” She remains optimistic on the back of a “positive outlook for the automotive industry as semiconductor supply issue eases out along with healthy order wins in the industrial space”.

  1. Bharat Heavy Electricals: ICICI Securities maintains a ‘Buy’ call on this industrial valve manufacturer with a target price of Rs 100, indicating an upside of 38.8%.The stock rose by 5.7% in the past month. In Q2FY23, the company reported a net profit of Rs 12.1 crore, as against a loss in the previous year, while its revenue increased marginally to Rs 5,418.7 crore. 

Bharat Heavy Electricals’ order inflow during Q2FY23 stood at Rs 12,000 crore and the total order book now stands at Rs 1.06 lakh crore. Rahul Modi, Ashwani Sharma and Aashna Manaktala said, “Given the addition of new orders with favourable payment terms, we expect execution to gather pace, followed by margin improvement supported by the recent correction in commodity prices.” 

The valve manufacturer's trade receivables declined 8% but overall receivables grew 8% YoY. The analysts concluded that Bharat Heavy Electricals’ efforts to improve cash flow and reduce receivables could achieve sustainable and profitable growth. 

  1. Manappuram Finance: Motilal Oswal maintains its ‘Buy’ call on this NBFC with a target price of Rs 140. This indicates an upside of 25.7%. The stock price rose by 7.9% during the past month. In Q2Y23, the company’s net profit grew by 10.4% YoY to Rs 408.4 crore (17% higher than the brokerage’s estimate), while revenue increased 10.3% YoY to Rs 1,714.1 crore. Net interest income improved 9% YoY to Rs 1,080 crore, 6% higher than the brokerage’s estimates.

Analysts Abhijit Tibrewal, Nitin Aggarwal and Parth Desai ask the question: Should the NBFC now change from gold loan growth and margin compression to healthier yields and diversification in the loan book. “We feel Manappuram Finance should tread carefully in the non-gold segments as it is yet to exhibit a clear ‘right to win’ in these segments and strong non-gold AUM growth is also fraught with risks,” they said. 

The analysts raised their estimates and model profit CAGR of 13% over FY22-24 by factoring in higher margins in the gold loan segment and moderation in credit costs in the MFI business.

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

(You can find all analyst picks here)

 
Trendlyne Marketwatch
Trendlyne Marketwatch
21 Nov 2022
Market closes lower, Goldman Sachs lowers India’s GDP forecast for 2023 to 5.9% from 6.9%

Trendlyne Analysis

Indian indices closed in the red with the Nifty 50 closing below the 18,200 mark. European stocks traded lower than Friday’s levels. Major Asian indices closed in the red, despite the US indices closing in the green on Friday. US stocks rose marginally on Friday but fell on a weekly basis as investors assessed the impact of high inflation on company financials. Investors will also look forward to the US Federal Open Market Committee (FOMC) Meeting Minutes on Wednesday this week. Crude oil traded in the red for a fourth straight session as rising Covid cases in China and potential global recession affect the crude oil demand. Brent crude oil futures has lost over 6% in the last four trading sessions.

Nifty Smallcap 100 closed higher, despite the benchmark index trading in the red. Nifty Bank and Nifty FMCG closed lower than Friday’s close. Nifty IT closed in the red, despite the tech-heavy NASDAQ 100 closing flat on Friday.

Nifty 50closed at 18,159.95 (-147.7, -0.8%), BSE Sensexclosed at 61,144.84 (-518.6, -0.8%) while the broader Nifty 500closed at 15,453.80 (-97.1, -0.6%)

Market breadth is in the red. Of the 1,970 stocks traded today, 744 were on the uptick, and 1,152 were down.

  • Housing Development Finance Corp sees a short buildup in its November 24 future series as its open interest rises 10.5% with a put-call ratio of 0.84.

  • Ajit Isaac, promoter of Quess Corp, buys a 0.03% stake amounting to Rs 2.3 crore in the company. He now holds a 11.35% stake in the company.

  • Aarti Industries and Deepak Fertilisers & Petrochemicals Corp ink a binding term agreement for offtake and supply of Nitric Acid for 20 years. The estimated value of the order is more than Rs 8,000 crore.

  • M K Dhanuka, Managing Director of Dhanuka Agritech, expects double-digit growth in sales in FY23. He also expects margin pressures to continue in Q3FY23 due to a rise in input costs.

  • Financial Institutions, Commodity Printing/Stationaryand Mining industries rise by more than 3% in trade.

  • Goldman Sachs lowers India’s GDP forecast for 2023 to 5.9% from 6.9% earlier. The brokerage expects inflation to rise due to further interest rate hikes by the Reserve Bank of India.

  • Ahluwalia Contracts wins an order worth Rs 120.2 crore from the Government of Assam for the construction of Lachit Moidam Memorial and Cultural Complex at Lahdoigarh.

  • Aurobindo Pharma is falling as it receives 10 observations from the US FDA for its intermediate facility in Telangana. According to the company statement, the observations were procedural in nature and not related to data integrity.

  • Allied Digital Services is rising as the company wins a contract worth Rs 207.2 crore from the Punjab Municipal Infrastructure Development Company (PMIDC) in association with KEC International. The contract is for the smart cities project of Amritsar, Jalandhar and Sultanpur Lodhi.

  • ICICI Securities upgrades its rating on Delhivery to ‘Buy’ from ‘Sell’ with a target price of Rs 460, implying an upside of 31.1%. The brokerage turns positive on the company’s prospects given its low-cost structure, strong balance sheet and robust brand recall. It expects the company’s revenue to grow at a CAGR of 25.6% over FY22-25.

  • PVR is rising in trade as 0.70 lakh shares (0.1% equity) amounting to Rs 12.28 crore change hands, according to reports.

  • Zomatofalls as its co-founder Mohit Gupta resigns on Friday. "I am deciding to move on from Zomato to seek the other unknown adventures that life holds for me," Gupta says.

  • Engineers India wins an order from the Chennai Petroleum Corp for overall project management and engineering, procurement and construction management services. The services will be provided for revamping the once-through hydrocracker unit (OHCU), catalytic dewaxing unit (CDWU) and other off-site facilities at the Manali refinery.

  • CLSA does not expect further duty cuts on steel prices. However, it remains cautious as there is a downside risk to steel prices as global demand falls. The brokerage says that domestic prices of steel are at a premium to import and export parity.

  • Easy Trip Planners is surging as it trades ex-bonus and ex-split today. The company had fixed November 22 as the record date for its 1:2 stock split and 3:1 bonus issue. The stock shows up on the screener for companies with low debt.

  • IT stocks like Persistent Systems, L&T Technology Services, Coforge and Tech Mahindra are falling in trade. The broader sectoral index Nifty IT is also trading in the red.

  • Five-Star Business Finance’s shares list at a 1.1% discount to the issue price of Rs 474 on its debut on the bourses. The Rs 1,593.4 crore IPO was subscribed for 70% of the total shares on offer.

  • Archean Chemical Industries’ shares list at a 10.6% premium to the issue price of Rs 407 on its debut on the bourses. The Rs 1,462.3 crore IPO was subscribed for 32X the total shares on offer.

  • TPG Growth IV fund sells a 1.9% stake (5.4 crore shares) in FSN E-Commerce Ventures (Nykaa) for Rs 1,000.5 crore in a bulk deal on Friday.

  • PB Fintech’s wholly-owned subsidiary PB Fintech FZ buys a 26.72% stake in YKNP Marketing Management for $2 million in an all-cash deal. With this acquisition, PB Fintech will cater to the needs of the UAE market with YKNP providing sales support to the company.

Riding High:

Largecap and midcap gainers today include Indian Overseas Bank (23.45, 9.84%), Shriram Transport Finance Company Ltd. (1,300.15, 3.91%) and Punjab National Bank (47.60, 3.82%).

Downers:

Largecap and midcap losers today include FSN E-Commerce Ventures Ltd. (183.50, -4.63%), Oil And Natural Gas Corporation Ltd. (135.45, -4.44%) and Zomato Ltd. (64.30, -4.24%).

Volume Shockers

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

Top high volume gainers on BSE included Easy Trip Planners Ltd. (57.30, 20.03%), UCO Bank (18.65, 18.41%) and Bank of Maharashtra (28.80, 14.74%).

Top high volume losers on BSE were Avanti Feeds Ltd. (397.50, -6.27%), Ajanta Pharma Ltd. (1,224.00, -1.84%) and Delhivery Ltd. (344.55, -1.75%).

Swan Energy Ltd. (255.95, 14.21%) was trading at 16.0 times of weekly average. Punjab & Sind Bank (21.20, 12.47%) and Escorts Kubota Ltd. (2,196.05, 8.13%) were trading with volumes 11.2 and 9.7 times weekly average respectively on BSE at the time of posting this article.

BSE 500: highs, lows and moving averages

15 stocks overperformed with 52-week highs, while 11 stocks hit their 52-week lows.

Stocks touching their year highs included - Bank of India (77.10, 2.66%), Bank of Maharashtra (28.80, 14.74%) and Bharti Airtel Ltd. (851.20, 1.66%).

Stocks making new 52 weeks lows included - GlaxoSmithKline Pharmaceuticals Ltd. (1,308.55, -0.82%) and Johnson Controls-Hitachi Air Conditioning India Ltd. (1,105.00, -1.36%).

9 stocks climbed above their 200 day SMA including Indoco Remedies Ltd. (378.00, 3.14%) and Edelweiss Financial Services Ltd. (59.70, 2.93%). 20 stocks slipped below their 200 SMA including Mahindra Lifespace Developers Ltd. (378.90, -3.27%) and Strides Pharma Science Ltd. (328.90, -3.05%).

 
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21 Nov 2022