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Trendlyne Marketwatch
13 Oct 2022
Market closes lower, Rites wins order worth Rs 499.4 crore from Bangalore Metro Rail Corp

Trendlyne Analysis

Indian indices closed in the red with the volatility index, India VIX, rising above 20.5%. The Nifty 50 lost over 100 points but closed just above the 17,000 mark. European stocks traded higher after opening in the red as investors awaited the US inflation print to be released later in the day. India’s retail inflation rose to a five-month high of 7.41% in September and stayed above RBI’s upper tolerance limit of 6% for three consecutive quarters. India's index of industrial production fell 0.8% YoY in August, missing analysts' estimates.

Asian indices closed lower as US indices closed flat to lower on Wednesday. Minutes from the previous US Federal Reserve meeting indicated that the policymakers agreed to maintain a restrictive monetary policy stance going forward. Brent crude oil futures traded higher after posting losses for three straight trading sessions amid demand concerns due to rising risks of a global recession.

Nifty Smallcap 100 and Nifty Next 50 closed in the red, following the benchmark index. Nifty Realty and Nifty Bank closed lower than Wednesday’s levels. Nifty IT closed lower as investors assess major IT companies’ Q2FY23 results.

Nifty 50closed at 17,017.80 (-105.8, -0.6%), BSE Sensexclosed at 57,235.33 (-390.6, -0.7%) while the broader Nifty 500closed at 14,732.35 (-97.6, -0.7%)

Market breadth is overwhelmingly negative. Of the 1,934 stocks traded today, 588 were on the uptick, and 1,298 were down.

  • HCL Technologiessees a long build-up in its October 27 future series as its open interest rises 6.8% with put to call ratio of 0.61.

  • Yashovardhan Saboo, Founder and Chairman of Ethos, expects Q3FY23 to be the biggest quarter for the company driven by festive and wedding season. He also expects the company’s revenue to grow 30-35% during FY23.

  • Hindustan Petroleum CorpandSanofi Indiahit their 52-week lows of Rs 205.6 and Rs 5,750.1, respectively. Both stocks fall for four consecutive sessions.

  • Samvardhana Motherson International, Bank of Indiaand Indian Hotelstrade below their second support orS2 levelas market trades lower.

  • Consulting Services, Commodity Printing/Stationery, and Shipping industries rise more than 10% over the past week.

  • Rites is rising as it secures an order worth Rs 499.4 crore from Bangalore Metro Rail Corp through a consortium. The order pertains to the construction of a depot cum workshop. The share of the company in this order is 51%.

  • Tata Teleservices is rising as it partners with Google Cloud to offer Google Workspace to small and medium businesses. The company will provide businesses with a single platform for communication and collaboration of their hybrid workforce.

  • The Society of Indian Automobile Manufacturers (SIAM) data shows that September auto wholesales surged due to the onset of the festive season. Two-wheeler wholesales rose 13% YoY to 17.4 lakh units and passenger car wholesales were up 122% YoY.

  • Tanla Platforms is rising after it sets October 25 as the record date for its proposed buyback of shares. The price is set at Rs 1,200 per share.

  • ICICI Securities upgrades HCL Technologies to 'Add' rating from 'Buy' with a target price of Rs 1,091. This indicates an upside of 7.2%. The brokerage believes that the company's risk-reward has become favourable as its order intake has been strong for the pas two quarters and a strong dividend yield gives the company a good base limiting downside risk. It expects the company's revenue to grow at a CAGR of 8.9% over FY22-24.

  • KR Choksey expects Sonata Software’s net profit to rise 12% YoY in Q2FY23, according to reports. It also expects net sales to rise 25.9% YoY. The stock shows up on a screener with increasing profits for the past four quarters.

  • Stocks like State Bank of India, Bajaj Finance and Housing Development Finance Corp are falling in trade. All stocks of the broader Nifty Financial Services index are trading in the red.

  • Oberoi Realty, Au Small Finance Bank, DCM Shriram, and Havells India’s weekly average delivery volumes rise ahead of their Q2FY23 results

  • India’s CPI inflation rises to a five-month high of 7.41% in September, compared to 7% in August. The rise is due to a surge in food inflation at 8.6% as against 7.6% in August.

  • Sterling and Wilson Renewable Energy is falling as it posts a net loss of Rs 296.9 crore in Q2FY23. The company's operating loss rises 7.7% to Rs 370.2 crore as its revenue falls 74.1% QoQ. The company features in the screener which reflects stocks that have a declining return on capital employed in the last two years.

  • ICICI Prudential Life Insurance sells a 0.54% stake (1.8 lakh shares) in Amber Enterprises for Rs 41.8 crore in a bulk deal on Wednesday.

  • India’s index of industrial production or IIP contracts 0.8% in August, an 18-month low. The contraction is due to fall in output of manufacturing and mining sectors.

  • Dolly Khannasells stake in Goa Carbonsduring Q2FY23, she now holds below 1% stake in the company as against a 1.1% stake at the end of Q1FY23.

  • HCL Technologies is rising as its Q2FY23 net profit rises 6.3% QoQ to Rs 3,489 crore driven by robust demand for cloud, engineering, and digital services. Its revenue grows by 5.2% QoQ led by the IT & business services segment. The stock shows up on the screener which lists companies with increasing revenue sequentially for the last eight quarters.

  • Wipro’s Q2FY23 net profit rises 3.5% QoQ to Rs 2,649.1 crore. Revenue increases 4.7% QoQ as revenue from the IT services segment (Americas, Europe and APMEA) rises. The management says that it expects revenue growth of 0.5-2% for Q3FY23 and 10-12% for FY23.

Riding High:

Largecap and midcap gainers today include HCL Technologies Ltd. (982.10, 3.16%), Dr. Lal Pathlabs Ltd. (2,358.80, 2.40%) and Nippon Life India Asset Management Ltd. (271.75, 2.39%).

Downers:

Largecap and midcap losers today include Wipro Ltd. (379.10, -7.07%), Indian Hotels Company Ltd. (317.15, -4.04%) and Zomato Ltd. (61.25, -3.92%).

Crowd Puller Stocks

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

Top high volume gainers on BSE included Tanla Platforms Ltd. (812.15, 3.62%), HCL Technologies Ltd. (982.10, 3.16%) and Sun Pharma Advanced Research Company Ltd. (236.75, 3.09%).

Top high volume losers on BSE were Wipro Ltd. (379.10, -7.07%), Affle (India) Ltd. (1,180.65, -2.43%) and Eris Lifesciences Ltd. (707.95, -1.84%).

Godrej Industries Ltd. (430.30, -0.59%) was trading at 5.4 times of weekly average. KEI Industries Ltd. (1,453.10, 1.46%) and Computer Age Management Services Ltd. (2,596.60, 1.14%) were trading with volumes 4.7 and 4.6 times weekly average respectively on BSE at the time of posting this article.

BSE 500: highs, lows and moving averages

7 stocks made 52-week highs, while 12 stocks hit their 52-week lows.

Stocks touching their year highs included - IDFC Ltd. (74.60, -2.29%), Sun Pharmaceutical Industries Ltd. (968.40, 1.34%) and TVS Motor Company Ltd. (1,077.60, -0.93%).

Stocks making new 52 weeks lows included - Alembic Pharmaceuticals Ltd. (575.60, -1.16%) and Biocon Ltd. (262.40, -1.89%).

12 stocks climbed above their 200 day SMA including Rajesh Exports Ltd. (672.70, 3.72%) and Marico Ltd. (515.55, 1.41%). 19 stocks slipped below their 200 SMA including Havells India Ltd. (1,230.95, -3.09%) and Avanti Feeds Ltd. (470.90, -2.43%).

 
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The Baseline
12 Oct 2022
Five analysts make their picks ahead of Q2 results
By Abhiraj Panchal
  1. Relaxo Footwears: Sharekhan maintains a ‘Buy’ call on this footwear brand with a revised target price of Rs 1,185. This indicates an upside of 18%. In H2FY22, the company took cumulative price hikes of 25-30% which affected the sales volume. To arrest the sales volume drop, the footwear manufacturer reduced prices by 12-15% in its key value-for-money brands such as Relaxo, Flite, and Bahamas.

Analysts at Sharekhan say, “The price corrections undertaken will take some time to come in the market and hence Q2FY23 sales volumes are expected to be muted due to weak consumer sentiment affected by inflationary pressures.” They expect a gradual recovery from Q3FY23. According to the analysts, Relaxo has a strong, debt-free balance sheet with good cash generation ability, and it is on track to achieve revenue and earnings CAGR of 14% and 22%, respectively over FY22-FY25.

  1. Phoenix Mills: ICICI Securities maintains a ‘Buy’ call on this retail mall developer with a target price of Rs 1,638, indicating an upside of 13.7%. FY21 and FY22 operations were impacted by mall shutdowns across India owing to successive Covid waves. However, with the waning Covid impact, in Q1FY23 like-to-like consumption across the mall stood at Rs 1,980 crore or 111% of Q1FY20. Analyst Adhidev Chattopadhyay estimates that thanks to  continued consumption strength, “we model for FY23 rental income of Rs 1,370 crore.” 

Phoenix Mills has nine operational malls and six under-construction malls which are expected to be operational over FY23-26. The estimated capex of these ongoing projects is Rs 9,320 crore, of which pending capex stands at Rs 5,050 crore.  Chattopadhyay adds, “We expect the company to generate annual operating cash flow of Rs 1,400-1,500 crore over FY23-25 which can comfortably fund the balance capex”. 

He also remains positive on the mall developer due to its strong brand recall and its leadership position among malls across India. 

  1. Divi's Laboratories: Ashika Research recommends a ‘Buy’ rating on this pharmaceutical company with a target price of Rs 4,110, indicating an upside of 12.1%. The analysts at the brokerage believe the company is well-placed to benefit from the expected growth in active pharmaceutical ingredients (API) manufacturing. Supply chain issues in China and the China+1 strategy among buyers has provided Indian API manufacturers with a great opportunity to expand, they added. The brokerage believes the firm’s capacity expansion plans and its strong capabilities in manufacturing APIs, intermediates, and active ingredients will enable it to expand its client base and gain market share.

The analysts also see the company’s generics segment driving growth along with APIs as a key positive. “Divi’s is expected to clock double-digit growth in established generics products where it enjoys market share in excess of 60-70%”, they add. The brokerage expects margin pressure to persist in the near-term but remains positive on the firm’s future growth prospects. It expects the company’s revenue to grow at a CAGR of 7% over FY22-24.

  1. Jubilant Foodworks: Bonanza initiates coverage of this restaurant chain company with a ‘Buy’ call and a target price of Rs 891, indicating an upside of 46.6%. “The quick service restaurant (QSR) master chef maintains its ground on the back of strong demand outlook and excellent execution capabilities,” says analyst Shreya Hanchate. 

Hanchate believes that Jubilant Foodworks is the largest food service brand in the QSR industry and has the benefit of being the first mover. It is also a leading fast-food industry player in terms of the number of stores (1,625 in Q1FY23). The company aims to grow up to 3,000 stores in the medium term. 

Hanchate says, “The resultant robust performance in Q1FY23, led by strong revenue growth, recovery in growth, and positive expectations from the new brands' portfolio makes Jubilant a hot pick.” On the back of sustained delivery demand, the analyst expects growth in EBITDA and profit margins of 26% and 11% respectively by FY24.

  1. Bajaj Finance: KRChoksey maintains its ‘Buy’ rating on this non-banking finance company (NBFC) with a target price of Rs 8,317, implying an upside of 14.8%. Analyst Vikrant Kashyap believes India’s growing housing market will be an important lever of growth for the company. He notes that the NBFC expects its assets under management to grow at an annual rate of 25-28% in FY23. He also believes that future growth will be fuelled by aggressive customer acquisition. He adds, “The NBFC is confident of adding 9-10 million customers by the end of FY23. The firm has been focusing on customer acquisition, which is expected to be its key growth driver”.

Kashyap expects the company’s position as a market leader in customer finance to bode well for it, as it is well-positioned to capitalise on the demand shift towards premium products across discretionary categories. He is also positive about the company’s ability to increase its presence and improve its technological capabilities. The analyst expects Bajaj Finance’s net profit to grow at a CAGR of 41.8% over FY22-24.

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

(You can find all analyst picks here)

 
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Trendlyne Marketwatch
12 Oct 2022
Market closes higher, Traxcn Technologies' IPO gets bids for 2X of the available shares

Trendlyne Analysis

Nifty 50 recovered over 160 points from the day’s low and closed in the green, above the 17,100 mark. European stocks traded mixed as UK’s GDP fell 0.3% MoM in August, missing estimates. The International Monetary Fund or IMF cut India’s economic growth estimate for FY23 to 6.8% from its July estimate of 7.4%. The IMF also warned of a worsening outlook for the global economy.

Most major Asian indices closed in the red, in line with the US indices, which closed mostly lower on Tuesday. The tech-heavy NASDAQ 100 index lost over 1.2% while the S&P 500 closed 0.7% lower on a volatile day of trade. Brent crude oil futures traded in the green after posting losses for two straight trading sessions amid demand concerns due to rising risks of a global recession.

Nifty Smallcap 100 and Nifty Next 50 closed in the green, following the benchmark index. Nifty Bank and Nifty FMCG closed higher than Tuesday’s levels. Nifty IT also closed higher, despite the tech-heavy NASDAQ 100 shedding over 1% on Tuesday.

Nifty 50 closed at 17,129.05 (145.5, 0.9%) , BSE Sensex closed at 57,625.91 (478.6, 0.8%) while the broader Nifty 500 closed at 14,834.55 (112.7, 0.8%)

Market breadth is in the red. Of the 1,935 stocks traded today, 834 were gainers and 1,045 were losers.

  • Stocks like Chalet Hotels, Rites, and Cochin Shipyard are in the overbought zone, according to the Money Flow Index or MFI.

  • Life Insurance Corporation and Natco Pharma hit their 52-week lows of Rs 613.8 and Rs 588, respectively. Both stocks fall for four sessions.

  • Sugar stocks like Balrampur Chini Mills, Shree Renuka Sugars, Triveni Engineering & Industries, and Bannari Amman Sugars are rising in trade. The rise comes after the Centre extends the validity for exporting raw sugar to the US under the tariff rate quota to December 31 from September 30, according to reports.

  • Morgan Stanley maintains its ‘Overweight’ rating on Infosys with a target price of Rs 1,550. The brokerage believes that there is scope for a buyback of up to $1.4 billion via an open offer.

  • Public sector banks like State Bank of India, Bank of Baroda, Canara Bank, Punjab National Bank and Union Bank of India are rising in trade. The broader sectoral index Nifty PSU Bank is also trading in the green.

  • Traxcn Technologies Rs 309.3-crore IPO gets bids for 2X of the available 2.1 crore shares on offer on the last day of bidding. The retail investor quota gets bids for 4.9X of the available 38.6 lakh shares on offer.

  • Metropolis Healthcare, DCM Shriram and JBM Auto trade above their second resistance or R2 level as market trades higher.

  • FMCG stocks like Hindustan Unilever, ITC, Nestle India, Dabur India, Britannia Industries and Godrej Consumer Products are rising in trade. The broader sectoral index Nifty FMCG is also trading in the green.

  • Oil marketing and distribution companies like Indian Oil Corp and Bharat Petroleum Corp rise in trade as the Centre will approve a one-time compensation of under-recovery on LPG sales, according to reports. The compensation will be around Rs 20,000 crore.

  • L&T Finance Holdings is rising as Securities and Exchange Board of India approves the proposed sale of its 100% stake in L&T Investment Management to HSBC Asset Management (India). L&T Investment Management is the wholly-owned subsidiary of L&T Finance Holdings and also the asset manager of L&T Mutual Fund.

  • Biocon hits a 52-week low of Rs 262.25 today after trading low for the last five trading sessions. This is after the European Directorate for the Quality of Medicines and Healthcare (EDQM) found a major deficiency at its Bengaluru active pharmaceutical ingredient plant on October 6.

  • Mahindra & Mahindra (M&M) is rising as Jio-bp announces the strengthening of its partnership with the company, according to reports. This pertains to the setting up of an extensive charging infrastructure for M&M’s upcoming new electric vehicle launches. Jio-bp is a fuels and mobility joint venture between Reliance Industries and bp.

  • Crompton Greaves Consumer Electricals is falling as 20.79 lakh shares (0.33% equity) amounting to Rs 79 crore change hands in a large trade, according to reports.

  • Surface Transportation, Coal, and Advertising & Media industries rise more than 1.5% in trade today.

  • ICICI Securities remains positive on Sobha’s future growth prospects as it retains its ‘Buy’ rating on the company with a target price of Rs 808. The brokerage expects the company to achieve robust sales value growth in FY23 led by rising demand and a strong launch pipeline. It anticipates the company’s revenue to grow at a CAGR of 19.2% over FY22-24.

  • NMDC is rising as the Ministry of Corporate Affairs approves its merger into NMDC Steel along with the respective shareholders and creditors.

  • Genesys International Corp bags contract worth Rs 46 crore from the state government of Andhra Pradesh to digitize 30,000 sq km of the state’s land records. The company shows up on a screener with stocks that consistently gave high returns over the past five years.

  • KR Choksey expects Shree Cements' net profit to fall by 48% YoY in Q2FY23. However, net sales might rise 12.7% YoY. The stock shows up on a screener with increasing revenue for the past three quarters.

  • The International Fund (IMF) lowers its forecast for India’s GDP by 60 bps to 6.8% in FY23 from its earlier estimate of 7.4% due to sluggish growth in Q1FY23.

  • Suzlon Energy wins an order from the Aditya Birla Group to develop a 144.9 MW wind power project. Suzlon will install 69 units of wind turbine generators of 2.1 MW each. The project will be executed in Gujarat and Madhya Pradesh and will be commissioned in 2023.

  • Delta Corp posts a profit of Rs 68.2 crore in Q2FY23 compared to a loss of Rs 22.6 crore in Q2FY22. Its revenue rises more than 3.6X YoY driven by the gaming operations segment, as the revenue from this segment jumps 6.8X YoY. The company shows up on a screener which lists stocks with an improving book value per share for the past two years.

Riding High:

Largecap and midcap gainers today include L&T Finance Holdings Ltd. (77.90, 3.87%), IDFC First Bank Ltd. (55.10, 3.77%) and Mahindra & Mahindra Financial Services Ltd. (207.05, 3.71%).

Downers:

Largecap and midcap losers today include Zomato Ltd. (63.75, -2.75%), Laurus Labs Ltd. (498.75, -2.62%) and PB Fintech Ltd. (457.30, -2.21%).

Crowd Puller Stocks

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

Top high volume gainers on BSE included La Opala RG Ltd. (384.70, 8.09%), Manappuram Finance Ltd. (104.10, 4.94%) and Cholamandalam Investment & Finance Company Ltd. (744.60, 3.53%).

Top high volume losers on BSE were Bombay Burmah Trading Corporation Ltd. (903.90, -0.65%), Indoco Remedies Ltd. (338.70, -0.35%) and Medplus Health Services Ltd. (597.65, -0.24%).

Century Textiles & Industries Ltd. (834.80, 2.25%) was trading at 3.0 times of weekly average.

BSE 500: highs, lows and moving averages

6 stocks overperformed with 52 week highs, while 8 stocks were underachievers and hit their 52 week lows.

Stocks touching their year highs included - IDFC First Bank Ltd. (55.10, 3.77%), IDFC Ltd. (76.35, 5.02%) and ZF Commercial Vehicle Control Systems India Ltd. (10,756.55, 4.82%).

Stocks making new 52 weeks lows included - Biocon Ltd. (267.45, -0.48%) and Natco Pharma Ltd. (590.50, -1.87%).

15 stocks climbed above their 200 day SMA including L&T Finance Holdings Ltd. (77.90, 3.87%) and Supreme Industries Ltd. (2,021.90, 3.07%). 19 stocks slipped below their 200 SMA including Aarti Drugs Ltd. (448.45, -2.82%) and Kajaria Ceramics Ltd. (1,100.85, -2.16%).

 
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Trendlyne Marketwatch
11 Oct 2022
Market trades lower, Traxcn Technologies' IPO gets bids for 54% of the available shares

Trendlyne Analysis

Nifty 50 lost over 250 points amid selling pressure towards the end of the trading session and closed below the 17,000 mark. Indian indices closed in the red with the volatility index, India VIX, at around 20.5%. European stocks followed the global trend and traded lower than Monday’s close as the Bank of England warned of a "material risk to U.K. financial stability" due to crisis in the country's pension fund sector.

Major Asian indices closed in the red, in line with the US indices, which also closed lower on Monday. The tech-heavy index NASDAQ 100 lost over 1% and settled at its lowest level since July 2020. Investors look ahead to the Federal Open Market Committee meeting minutes and US inflation print to be released later this week. Brent crude oil futures traded sharply after losing 2.4% on Monday. However, crude oil is still up over 9% in the last six days amid supply concerns.

Nifty Smallcap 100 and Nifty Midcap 100 closed in the red, following the benchmark index. Nifty Energy and Nifty Pharma closed lower than Monday’s levels. Nifty IT closed in the red as investors assessed TCS’ Q2FY23 results announced on Monday.

Nifty 50 closed at 16,964.15 (-276.9, -1.6%) , BSE Sensex closed at 57,147.32 (-843.8, -1.5%) while the broader Nifty 500 closed at 14,700.90 (-250.8, -1.7%)

Market breadth is highly negative. Of the 1,937 stocks traded today, 419 showed gains, and 1,476 showed losses.

  • Stocks like Cochin Shipyard, Rites, Mazagon Dock Shipbuilders, and Tejas Networks are in the overbought zone, according to the relative strength index or RSI.

  • Brigade Enterprises' Chairman and Managing Director M R Jaishankar steps down as the company’s MD. He will continue to remain the Executive Chairman.

  • ITD CementationIndia wins orders worth Rs 1,755 crore for construction projects like container terminal in the port of Colombo in Sri Lanka, berth and yard facilities at Dhamra port in Odisha, and piling and civil work for coke oven project at Hazira plant in Gujarat.

  • Traxcn Technologies Rs 309.3-crore IPO gets bids for 54% of the available 2.1 crore shares on offer on the second day of bidding. The retail investor quota gets bids for 2.6X of the available 38.6 lakh shares on offer.

  • Mastek and Medplus Health Services hit their 52-week lows of Rs 596.5 and Rs 1,663, respectively. Both stocks fall for three-consecutive sessions.

  • Larsen & Toubro’s arm L&T Construction wins repeat orders worth Rs 1,000-2,500 crore from the state government of Odisha. The order pertains to the execution of lift irrigation projects to enable the irrigation of almost 30,000 hectares in the districts of Keonjhar, Jajpur, and Kendrapada in Odisha.

  • HDFC Securities initiates coverage on Endurance Technologies with a ‘Reduce’ rating and a target price of Rs 1,340. The brokerage expects the company’s profitability to be impacted by the slowdown in demand for two-wheelers, a fall in demand for passenger vehicles in Europe, and a sharp rise in energy costs in Europe. The brokerage also believes the company is currently trading at an expensive valuation

  • Commerial Services & Supplies, Hardware Technology & Equipment and Hotels, Restaurants & Tourismsectors rise more than 25% in the past 90 days.

  • Rajesh Ravi of HDFC Securities expects the cement industry’s volume to grow 8% YoY. He also expects the industry’s margin to expand during H2FY23 however fluctuations in fuel prices remain a concern.

  • Sobha is rising as its total sales value rises 13% YoY to Rs 1,164.2 crore as demand for residential and office spaces increases in Q2FY23. Its average price realization is up 14% YoY. It shows up on a screener which lists stocks with strong cash-generating ability from core business.

  • Sugar stocks like Shree Renuka Sugars, EID Parry (India), Balrampur Chini Mills, and Dalmia Bharat Sugar and Industries are rising in trade. The sugar industry is up 2.5% in trade today.

  • Automotive Axles is rising as Cummins Inc places an open offer to acquire 26% stake (or 39.3 lakh shares) in the company. The open offer comes after Cummins' subsidiary, Rose Inc entered a merger agreement with Meritor Inc. Meritor is a promoter entity of Automotive Axles and holds 35.52% stake in the company.

  • Realtystocks like Brigade Enterprises, Oberoi Realty, Sobha, and Phoenix Mills are falling in trade. The broader sectoral index Nifty Realty is also trading in red.

  • IndusInd Bank falls over 3% as 1.2 crore shares (1.6% equity) amounting to Rs 1,442 crore change hands in a large trade, according to reports.

  • Infosys announces that its board of directors will consider a proposal to buyback equity shares at its upcoming board meeting on Thursday.

  • Adani Ports & Special Economic Zone (APSEZ) receives approvals from the national company law tribunals of Ahmedabad and Hyderabad to acquire the remaining 58.1% stake in Gangavaram Port (GPL). The company had already bought a 41.9% stake in GPL during FY22. The remaining stake will be purchased through a share swap deal, with 4.77 crore shares of APSEZ being issued to the promoters of GPL. The acquisition is valued at Rs 6,200 crore.

  • Morgan Stanley expects Delhivery’s express parcel volumes to go up during the festive season. It also expects the company's gross margin to improve to 21% in Q2FY23, compared to 16.8% in Q1.

  • RateGain Travel Technologies, a SaaS company, is rising in trade as Royal Orchid Hotels selects the company to help the hotel chain in providing competitive pricing and connect online travel agents globally.

  • Mohnish Pabrai buys a 0.4% stake in Rain Industriesin Q2FY23, he now holds an 8.8% stake in the company.

  • India Cements sells its entire shareholding in Springway Mining to JSW Cement for a cash consideration of Rs 476.9 crore. Springway Mining is no longer a wholly owned subsidiary of India Cements.

  • Tata Consultancy Services’ Q2FY23 net profit rises 10% QoQ to Rs 10,431 crore led by strong deal wins. Revenue increases by 4.8% QoQ driven by growth across all its business verticals led by the communication, media & technology and life sciences & healthcare segments. The stock shows up on the screener which lists companies with revenue increasing sequentially for the past eight quarters.

Riding High:

Largecap and midcap gainers today include Bata India Ltd. (1,810.30, 1.64%), Gland Pharma Ltd. (2,083.60, 1.58%) and Axis Bank Ltd. (785.55, 1.12%).

Downers:

Largecap and midcap losers today include JSW Energy Ltd. (326.85, -5.33%), Divi's Laboratories Ltd. (3,502.20, -5.00%) and Havells India Ltd. (1,279.40, -4.91%).

Movers and Shakers

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

Top high volume gainers on BSE included Kalpataru Power Transmissions Ltd. (447.90, 4.71%), Rajesh Exports Ltd. (625.90, 3.98%) and Star Cement Ltd. (110.05, 3.58%).

Top high volume losers on BSE were Divi's Laboratories Ltd. (3,502.20, -5.00%), IndusInd Bank Ltd. (1,164.60, -3.78%) and Intellect Design Arena Ltd. (502.65, -3.32%).

Motilal Oswal Financial Services Ltd. (697.80, -0.69%) was trading at 13.2 times of weekly average. Shipping Corporation of India Ltd. (118.85, 2.06%) and Aster DM Healthcare Ltd. (248.30, -2.65%) were trading with volumes 6.8 and 4.3 times weekly average respectively on BSE at the time of posting this article.

BSE 500: highs, lows and moving averages

6 stocks took off, crossing 52 week highs, while 7 stocks were underachievers and hit their 52 week lows.

Stocks touching their year highs included - Kalpataru Power Transmissions Ltd. (447.90, 4.71%), Star Cement Ltd. (110.05, 3.58%) and Tata Chemicals Ltd. (1,164.35, -2.94%).

Stocks making new 52 weeks lows included - Biocon Ltd. (268.75, -3.12%) and Motilal Oswal Financial Services Ltd. (697.80, -0.69%).

8 stocks climbed above their 200 day SMA including Shipping Corporation of India Ltd. (118.85, 2.06%) and Honeywell Automation India Ltd. (38,890.20, 0.64%). 28 stocks slipped below their 200 SMA including United Spirits Ltd. (815.60, -4.94%) and PNB Housing Finance Ltd. (386.20, -4.79%).

 
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Trendlyne Marketwatch
10 Oct 2022
Market closes lower, Tracxn Technologies' IPO gets bids for 23% of the available shares

Trendlyne Analysis

Nifty 50 recovered over 175 points from its day’s low but still closed in the red on a volatileday of trade. European indices followed the global trend and traded lower than Friday’s close. India's foreign exchange reserves fall to $532.66 billion, its lowest level since July 2020. India's forex reserves decrease by $4.85 billion for the week ending September 30 compared to the previous week. Indian rupee touches a new lifetime low of 82.64 against the US dollar in early trade today.

Major Asian indices closed in the red, in line with the US indices, which settled sharply lower on Friday. US stocks fell as strong September jobs report raised the possibility of the Federal Reserve continuing with its aggressive monetary policy tightening to combat high inflation. The tech-heavy NASDAQ 100 fell 3.9% while the Dow Jones closed 2.1% lower. Brent Crude oil futures traded lower after rising 3.7% on Friday. Crude oil prices hit a five-week high on Friday amid supply concerns as OPEC+ recommended the largest supply cut since 2020 last week.

Nifty Smallcap 100 and Nifty Midcap 100 closed in the red, following the benchmark index. Nifty FMCG and Nifty Media closed lower than Friday’s levels. Nifty IT closed higher as investors looked ahead to heavyweight Tata Consultancy Services’ Q2FY23 results to be declared later today.

Nifty 50closed at 17,252.45 (-62.2, -0.4%), BSE Sensexclosed at 57,991.11 (-200.2, -0.3%) while the broader Nifty 500closed at 14,961.25 (-75.5, -0.5%)

Market breadth is overwhelmingly negative. Of the 1,964 stocks traded today, 616 were on the uptrend, and 1,283 went down.

  • Hero MotoCorpsees a short build-up in its October 27 future series as its open interest rises 22.5% with put to call ratio of 0.28.

  • US introduces new measures to cut off China from various semiconductor chips made in the world with the help of US equipment. The US aims to slow down China’s technological and military advancements through these measures.

  • ICICI Securities reiterates its 'Buy' rating on Macrotech Developers with a target price of Rs 1,348. This indicates an upside of 35.3%. The brokerage believes that the company's strong launch pipeline and sustenance in sales momentum will help revenue growth. It estimates the company's revenue to grow at a CAGR of 4.3% over FY22-24.

  • Suzlon Energy appoints Vinod R Tanti as the Chairman and Managing Director of the company on Friday. The appointment is subject to the approval of the shareholders at the next general meeting.

  • Mazagon Dock Shipbuilders and Cochin Shipyard hit their 52-week highs of Rs 680 and Rs 559.8, respectively. Both stocks rise for seven consecutive sessions.

  • JSW Steel’s Q2FY23 combined crude steel production rises 12% to 5.68 million tonnes led by its Indian operations’ production volumes rising 36% YoY. However, its combined crude steel production falls 3% QoQ due to maintenance shutdowns, supply chain constraints, and subdued market conditions in the US.

  • Axis Direct initiates coverage on IDFC First Bank with a ‘Buy’ rating and a target price of Rs 70, implying an upside of 29%. The brokerage expects the bank’s profitability to improve as it has one of the best CASA ratios among its peers, a well-diversified retail loan book, a pan-India geographical presence, and improving asset quality. The brokerage estimates the bank’s net profit to grow at a CAGR of 194.6% over FY22-25.

  • Tracxn Technologies Rs 309.3-crore IPO gets bids for 23% of the available 2.1 crore shares on offer on the first day of bidding. The retail investor quota gets bids for 1.2X of the available 38.6 lakh shares on offer. The issue is entirely an offer for sale.

  • Nomura expects India’s FY24 GDP growth rate to fall to 5.2% due to a slowdown in the global economy. It expects India's GDP growth to be at 7% in FY23.

  • Consulting Servicessector rises more than 6% in trade today despite a weak market. Integrated oil & gas, non-alcoholic beverages and surface transportationsectors fall more than 3.5% in trade today.

  • Chetan Ahya of Morgan Stanley says that the depreciation of the rupee will continue. He expects a rate hike rate of 25 bps by the US Federal Reserve in January.

  • Easy Trip Planners is rising as its board approves a stock split in the ratio of 1:1, subject to shareholders' approval. This will be followed by a bonus issue of three bonus shares for one existing share. The company had done a bonus issue in the ratio of 1:1 in February.

  • Adani Group is in advanced talks with Jaiprakash Power Ventures to acquire its cement unit for Rs 5,000 crore, according to reports. Jaiprakash Power Ventures intends to divestits cement grinding unit in Nigrie, Madhya Pradesh and other non-core assets. The company intends to use the proceeds of the sale of its cement unit to cut debt.

  • Bandhan Bank falls as its CASA ratio dips 380 bps YoY to 40.8% in Q2FY23. However, loan advances rise 22% YoY and total deposits increase to 21% YoY. The bank’s collection efficiency also improves to 97% in Q2.

  • IDBI Bank is rising as the Centre invites bids to sell a large part of its stake in the company. Currently, the Government of India holds a 45.4% stake and the Life Insurance Corp of India (LIC) holds a 49.2% stake in the company. The Centre plans to offload a 30.4% stake and LIC plans to pare its holding by 30.2%. The management control will also be transferred to IDBI Bank.

  • Ramkrishna Forgingswins an export order worth Rs 131.5 crore from a rear and front Axle manufacturer for its heavy commercial vehicles application in North America. The order will be executed over a period of four years.

  • Hindustan Unilever and Godrej Consumer Products are falling in trade as they cut soap prices due to raw material costs easing up. Fall in palm oil costs results in Hindustan Unilever cutting prices by 5-11% and Godrej Consumer Products by 13-15%.

  • Indian rupee touches a new lifetime low of 82.64 against the US dollar in early trade today.

  • One97 Communications (Paytm) is rising as its loan disbursals grow 224% YoY to 92 lakhs in Q2FY23, while the value of loans disbursed rises 482% YoY. Merchant payment volumes increase by 63% YoY. Offline payment volumes, subscription revenue and merchant loan distribution rise as devices deployed at merchant stores increase to 48 lakh in Q2.

  • Traxcn Technologies’ raises Rs 139 from investors ahead of its IPO which opens for subscription today. The company allotted 1.7 crore equity shares at a price of Rs 80 per share to the anchor investors. The investors include ICICI Prudential, India Acorn Fund, Whiteoak Capital, Abakkus Emerging Opportunities Fund, BNP Paribas Arbitrage, Tara Emerging Asia Liquid Fund, and Motilal Oswal Fund.

  • Tata Motors arm Jaguar Land Rover’s retail sales fall 4.9% YoY to 88,121 units in Q2FY23. However, retail sales were higher on a QoQ basis. The company says that although sales were up in Q2 production continues to be affected by semiconductor shortages.

Riding High:

Largecap and midcap gainers today include IDBI Bank Ltd. (46.55, 9.02%), One97 Communications Ltd. (727.25, 2.80%) and Axis Bank Ltd. (776.85, 2.80%).

Downers:

Largecap and midcap losers today include Varun Beverages Ltd. (1,089.60, -4.02%), Tata Motors Ltd. (395.95, -3.93%) and Ashok Leyland Ltd. (154.35, -3.32%).

Movers and Shakers

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

Top high volume gainers on BSE included Brightcom Group Ltd. (41.45, 12.94%), IDBI Bank Ltd. (46.55, 9.02%) and Rail Vikas Nigam Ltd. (38.50, 6.94%).

Top high volume losers on BSE were Cholamandalam Financial Holdings Ltd. (636.90, -1.28%), Crisil Ltd. (3,133.70, -1.12%) and Westlife Development Ltd. (729.75, -0.18%).

Castrol India Ltd. (115.50, 3.22%) was trading at 6.8 times of weekly average. Star Health and Allied Insurance Company Ltd. (732.60, 1.88%) and Jyothy Labs Ltd. (200.80, 2.32%) were trading with volumes 6.7 and 4.7 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 2 stocks hit their 52-week lows.

Stocks touching their year highs included - EID Parry (India) Ltd. (605.80, -1.62%), IDFC Ltd. (72.55, 2.62%) and J B Chemicals & Pharmaceuticals Ltd. (1,970.15, -1.49%).

Stocks making new 52 weeks lows included - Motilal Oswal Financial Services Ltd. (702.65, -1.51%) and Gland Pharma Ltd. (2,051.10, -1.23%).

7 stocks climbed above their 200 day SMA including Equitas Holdings Ltd. (102.65, 2.14%) and DCM Shriram Ltd. (1,047.70, 1.54%). 24 stocks slipped below their 200 SMA including Hatsun Agro Products Ltd. (1,029.50, -3.15%) and Prestige Estates Projects Ltd. (454.50, -2.80%).

 
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The Baseline
07 Oct 2022
Five Interesting Stocks Today
  1. APL Apollo Tubes: The stock of this structural steel tube maker gained over 9% ever since it released its business update for Q2FY23 on October 1, 2022. It also touched a 52-week high on Thursday and has outperformed the Nifty 500 index by over eight percentage points in the past week.

APL Apollo Tubes reported its highest-ever sales volumes in Q2FY23 which were at 6.02 lakh tonnes. The volumes jumped over 40% YoY and sequentially in Q1FY23 led by the ‘Apollo Structural’ product category. Within this category, general structures grew the fastest in this quarter. As a result, share of the value-added segment in APL’s overall volumes fell to 54% in the quarter from 61% in Q1FY23. The management’s medium-term goal is contrary to the actual result. It aims to raise the share of value-added products in its sales volumes to 75% by FY25. Nevertheless, the volume numbers for Q2FY23 are impressive as the company had seen its volume fall by more than 20% QoQ in the previous quarter. This was on account of distributors reducing their stocks as a response to falling steel prices. Back then, the company was confident of clocking one million tonnes of sales in H1FY23. It has comfortably exceeded that target despite Q2FY23 being a seasonally weak quarter for construction given the monsoon season.

Given the rising applications of steel tubes for construction of airports, warehouses and high-rise buildings, the company aims to clock a volume CAGR of over 30% between FY22 and FY25. Its targeted sales volumes are at four million tonnes for FY25. Its upcoming facility of 1.5 MTPA in Raipur will enable APL Apollo to achieve this growth target. In fact, the company may generate additional volumes of 30 to 40 lakh tonnes from the Raipur plant in FY23. The outlook for APL Apollo is promising with the government’s thrust on infrastructure development. 

  1. Angel One: This brokerage company’s stock rose over 12% on Tuesday after it released its monthly business update. Angel One’s client base rose 77.4% YoY to 1.15 crore in September. In addition, a jump in average daily turnover (ADTO) of Futures and Options (FnO) and commodities segments helped the overall ADTO to increase by 116.4% YoY. With such a rise in share price after the business update, Angel One comes up in a screener that shows companies whose share price is trading above their short, medium, and long-term moving averages. 

The sharp rise in the FnO ATDO could be due to the volatile nature of the markets. This bodes well for the company as it has a higher dependence on FnO income. Overall, the top five brokerages account for around 58% of the overall NSE active clients with Angel one’s market share at about 9%.

Though the company posted strong numbers, investors will have to note that trading enthusiasm slows down when markets are in a downturn. This remains a key risk for Angel One. This is reflected in its gross client acquisition, which fell both YoY and QoQ in September. Active users in the industry also fell both in July and August indicating a slowdown. However, the company’s share price is rising ahead of its Q2FY23 results, which is scheduled to be released on October 13. 

  1. VIP Industries: This luggage manufacturer rose more than 7% in intra-day trade on Monday and over the past month, it gained over 18.9% till Thursday. The uptrend in the stock’s price comes on the back of a robust business outlook. The rise in demand for travel this festive season is expected to augur well for the company given its dominant position in the organised luggage industry. The firm commands a market share of 45% in the industry, according to reports. Another key positive for the company has been its focus on increasing revenue from its own manufacturing. In-house manufacturing contributed 64% of revenue in Q1FY23, up from 35% in Q1FY20. 

Along with improving its manufacturing capabilities, the firm has sharply reduced sourcing finished goods from China in Q1FY23 to 11% from 40% in FY20, according to ICICI Direct. This helps it reduce its exposure to forex fluctuations and disruptions in the supply chain. Over the past year, the company has risen over 40.4% till Thursday and made it to this screener with stocks that have had high returns consistently over the past 5 years.

The management has targeted annual revenue of Rs 2,000 crore in FY23, given a recovery in demand and a fall in some key raw material prices, according to reports. Trendlyne’s Forecaster estimates its revenue to grow 32.9% YoY to Rs 1,921.3 crore in FY23, coming in close to the company’s intended target. At the end of FY22, the company had 376 exclusive brand outlets, and by the end of FY23, it aims to increase its retail store network to 500. The firm hopes to achieve this target by expanding into smaller towns in India, and most of these outlets will be opened through a franchise model.

  1. Avenue Supermarts (DMart): This retail chain company rose more than 3% on September 30 after brokerage Prabhudas Lilladher increased its target price for the stock by 16.7% to Rs 5,118. The stock also shows up on a screener where brokers upgraded recommendations and target prices in the past three months. Three brokers upgraded their recommendations while five brokers increased their target price for the stock.

Prabhudas Lilladher feels that the stores opened by DMart during the pandemic will deliver gains in FY23. It also believes that the company’s current strategy of ‘Everyday Low Prices’ will drive sales in this festive season, beating inflation woes. It also expects ‘Dmart Ready’ - a new venture by the company into door-to-door delivery service - to clock growth in FY23 as its sales almost doubled in FY22. One view of the new venture is that despite heavy competition in this segment, DMart has not structured its model on heavy discounts which generally burns cash flow, resulting in losses. The brokerage expects DMart’s top line to grow by 38% YoY and net profit to increase by 46% in Q2FY23.

The company recently gave out its quarterly business update. Its revenue is up 35.8% YoY to Rs 10,384.6 crore in Q2FY23. This number is almost double (Rs 5,218.1 crore) of revenue generated in Q2FY21. Although revenue growth is slightly down because of lower rural demand and rising inflation, some segments like apparel and general merchandise are seeing a surge. The company also plans to open more stores and expand geographically in FY23. Analysts expect that Avenue Supermarts’ EBITDA will break even by FY25 if it scales up at a faster pace. 

  1. Blue Dart Express: This logistics company touched its all-time high of Rs 9,640 on Tuesday and rose 9.2% in the past week till Thursday. The stock started its uptrend after the company announced an increase in shipment prices by 9.6% on September 28, effective from January 1, 2023. The management said the price hike will be taken to offset rising input costs, high inflation, and rising interest rates. The surge in share price comes on the back of expected volume growth and market share gains. This is due to its 54% market share in the organised air express market and the ability to deliver to 98% of pin codes in India. The company also shows up on a screener which lists stocks with rising cash flow from their operations in the last two years.  

The company has been able to maintain its gross margins at 36% in FY22, despite  elevated aviation turbine fuel (ATF) prices. Its ability to pass on prices and a 30% surge in volumes during FY22 aided in maintaining its margin, according to Motilal Oswal. Looking ahead, the management wants to expand its ground express segment and increase the segment’s contribution to total revenue from its current levels. This is because it expects the growth in this segment to be 2X the growth in the air express segment, mainly due to cost differential in services. The management also plans to scale up its services in e-commerce as well, as it sees this segment driving growth in the long term.

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

 
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Trendlyne Marketwatch
07 Oct 2022
Market closes flat, EID Parry and Praj Industries hit their all-time highs

Trendlyne Analysis

Nifty 50recovered from its day’s low and closed flat, with the volatility index, India VIX, falling below 19%. European indices followed the global trend and traded lower than Thursday’s close. World Bank cuts India’s FY23 GDP forecast by 100 basis points to 6.5%. Indian rupee touched an all-time low of 82.2 against the US dollar amid rate hike concerns on Thursday.

Major Asian indices closed in the red, in line with the US indices, which closed lower on Thursday. US stocks fell on Thursday ahead of a key US jobs data release scheduled later today. The tech-heavy NASDAQ 100 fell 0.8% while the Dow Jones closed 1.2% lower on a volatile day of trade. Brent crude oil futures traded flat after rising around 8% in the last four trading sessions amid supply concerns.

Nifty Smallcap 100 closed in the green, despite the benchmark index closing lower. Nifty Bank and Nifty FMCG traded lower than Thursday’s close. Nifty IT closed lower, taking cues from the NASDAQ 100, which closed in the red on Thursday.

Nifty 50closed at 17,316.15 (-15.7, -0.1%), BSE Sensexclosed at 58,191.29 (-30.8, -0.1%) while the broader Nifty 500closed at 15,037.20 (-15.9, -0.1%)

Market breadth is in the green. Of the 1,925 stocks traded today, 1,027 were on the uptick, and 832 were down.

  • Stocks like Rites, Cochin Shipyard, Mazagon Dock Shipbuilders, and Zydus Lifesciencesare in the overboughtzone, according to the Money Flow Index or MFI.

  • Restaurant stocks like Jubilant Foodworks, Sapphire Foods India, Restaurant Brands Asia, Barbeque-Nation Hospitalityand Coffee Day Enterprisesfall in trade. The restaurant industry also trades in the red today.

  • Emkay Global reiterates its 'Buy' rating on IndusInd Bank with a target price of Rs 1,275. This indicates an upside of 10.3%. The brokerage believes the company's non-performing assets (NPA) will fall from the levels Q1FY23. It estimates the company's interest revenue to grow at a CAGR of 11.8% over FY22-25.

  • Tata Steel’s Q2FY23 domestic production rises 1.7% YoY but its Europe business segment’s production falls 6.3% YoY. The company’s domestic sales volume rises 7.2% YoY whereas its Europe business segment’s sales volume declines 12.1% YoY.

  • Electronics Mart’s Rs 500-crore IPO gets bids for 71.9X of the available 6.25 crore shares on offer on the last day of bidding. The retail investor quota gets bids for 19.7X of the available 3.1 crore shares on offer.

  • EID Parry (India) and Praj Industries hit their all-time highs of Rs 621.9 and Rs 461.4, respectively. Both stocks rise for three consecutive sessions.

  • NTPC signs an MoU with General Electric (GE) Gas Power to demonstrate the feasibility of hydrogen co-firing in the gas turbines to decarbonise power generation. This agreement pertains to GE’s gas turbines installed in the company’s Kawas gas power plant in Gujarat. The companies intend to explore ways to reduce carbon dioxide emissions from the Kawas power plant.

  • Lupin rises after it announces partnerships with global agencies like Unitaid, The Aurum Institute, Clinton Health Access Initiative (CHAI) etc. to support the treatment of tuberculosis. The company plans to introduce new formulations and affordable medicines which will be easily accessible in 138 countries.

  • Coal, Metals & Mining, and Hardware Technology & Equipmentsectors rise more than 6.5% in the past week.

  • Maruti Suzuki is rising after Goldman Sachs initiates coverage on the stock with a ‘Buy’ and a target price of Rs 10,500. The brokerage says that the company is in a better position due to falling raw material prices and its new model launches like Grand Vistara and Jimny.

  • Indian Overseas Bank, GMR Infrastructure and Mangalore Refinery and Petrochemicals trade below their second support or S2 level as market trades lower.

  • Indian Hume Pipe is rising as it bags an order worth Rs 194 crore from the Maharashtra government. The order is for the water supply of 150 villages in Jalgaon under the Jal Jeevan mission project.

  • Sharekhan continues to be positive on HDFC Bank’s growth prospects as it retains its ‘Buy’ rating on the bank with a target price of Rs 1,800. This indicates an upside of 23.9%. The brokerage expects the bank’s healthy loan growth trend to continue driven by the retail and corporate segments. It also believes the company’s focus on improving its digital capabilities and franchise network will aid growth in the coming quarters. The brokerage estimates the bank’s profit to grow at a CAGR of 17.5% over FY22-25.

  • World Bank lowers India’s FY23 GDP growth forecast to 6.5% from its earlier estimate of 7.5%.

  • Biocon falls after a European Directorate of Quality of medicines and healthcare (EDQM) cites a major deficiency at the API manufacturing site in Bangalore. The stock shows up on a screener of companies with declining RoA for the last two years.

  • Bank stocks IDFC First Bank, Bank of Baroda, Bandhan Bank among others are falling in trade. All constituents of the broader Nifty Bank index also trade in the red.

  • Indian rupee touches an all-time low of 82.2 against the US dollar in early trade today.

  • Titan is rising as its overall sales in Q2FY23 rise 18% YoY as customer sentiment improves across all of its business segments. The overall sales growth is driven by the jewellery, watches, and accessories & apparel segments rising 18% YoY, 20% YoY, and 58% YoY, respectively. The company adds 105 retail stores for the quarter.

  • Dolly Khannabuys a 0.1% stake in Talbros Automotive Componentsduring Q2FY23, she now holds a 1.2% in the company.

  • Quess Corp’s board approves the disinvestment of 53% stake in its non-material subsidiary Simpliance Technologies. Simpliance Tech is valued at Rs 120 crore and Quess Corp will receive its due consideration after adjustments are made for cash, debt and working capital. The company shows up on a screener which lists stocks with improving RoE in the last two years.

Riding High:

Largecap and midcap gainers today include Zomato Ltd. (69.55, 6.10%), Titan Company Ltd. (2,730.50, 5.31%) and JSW Energy Ltd. (345.00, 4.34%).

Downers:

Largecap and midcap losers today include Adani Total Gas Ltd. (3,187.60, -3.64%), Jubilant Foodworks Ltd. (618.95, -3.17%) and Dalmia Bharat Ltd. (1,524.35, -2.95%).

Crowd Puller Stocks

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

Top high volume gainers on BSE included Poly Medicure Ltd. (1,010.65, 6.18%), Zomato Ltd. (69.55, 6.10%) and Mahindra CIE Automotive Ltd. (317.25, 6.00%).

Top high volume losers on BSE were Varroc Engineering Ltd. (315.30, -6.87%), Dalmia Bharat Ltd. (1,524.35, -2.95%) and Emami Ltd. (487.75, -2.50%).

Century Plyboards (India) Ltd. (630.15, 0.02%) was trading at 4.1 times of weekly average. Titan Company Ltd. (2,730.50, 5.31%) and eClerx Services Ltd. (1,460.65, 2.59%) were trading with volumes 4.1 and 3.7 times weekly average respectively on BSE at the time of posting this article.

BSE 500: highs, lows and moving averages

14 stocks overperformed with 52-week highs, while 1 stock hit its 52-week lows.

Stocks touching their year highs included - EID Parry (India) Ltd. (615.80, 1.85%), Phoenix Mills Ltd. (1,451.65, 2.39%) and Solar Industries India Ltd. (4,139.30, 1.87%).

Stock making new 52 weeks lows included - Motilal Oswal Financial Services Ltd. (713.40, -2.37%).

12 stocks climbed above their 200 day SMA including JSW Energy Ltd. (345.00, 4.34%) and Heidelberg Cement India Ltd. (197.70, 3.73%). 12 stocks slipped below their 200 SMA including Endurance Technologies Ltd. (1,360.05, -2.91%) and Godrej Consumer Products Ltd. (829.85, -2.79%).

 
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The Baseline
06 Oct 2022
Chart of the week: Hong Kong's Hang Seng index falls the most in the past six months
By Abdullah Shah

2022 has seen rising inflation and interest rates, as well as conflict in Europe. The weakening environment has spooked investors,  resulting in a global sell-off across indices as people hunt for less risky options for their money.

The Hang Seng index of Hong Kong, China fell 18.4%, the most in the past six months among global indices. The index fell to its lowest level since October 2011. The major reason for this fall is traders selling equities for much safer government bonds, as Covid zero policies and weakening GDP growth discourage investment. 

The USA’s S&P 500 fell 15.6% in the last six months. Ever since the Federal Reserve raised interest rates by 75 bps for the third consecutive time on September 21, the index has taken another plunge and dropped below the lows of June.

The United Kingdom’s FTSE 100 index fell 7.1% over the last six months. The US Fed’s interest rate hikes combined with the UK government’s unfunded tax cuts in its mini-budget have resulted in the British pound falling to its all-time low of $1.038 on September 26. The concerns around the tax cuts fuelling further inflation in the UK has caused investors to pull out of the equity market.

India’s Nifty 50 index has fared well compared to most other global indices. It has fallen just 2.4% in the past six months. A broad sell-off from foreign investors contributed to this drop. Another reason is the fall of the Indian rupee to its all time low of Rs 81.9 per dollar on September 28. Japan’s Nikkei index has recovered in recent weeks on the back of strong buying from retail investors.

As we head into the second half of FY23, central banks are likely to further increase interest rates to keep inflation in check. 

 
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Trendlyne Marketwatch
06 Oct 2022
Market closes higher, Apollo Hospitals acquires 60% stake in Kerala First Health Services

Trendlyne Analysis

Nifty 50 closed in the green but fell from its day’s high towards the final hour of the trading session. European shares traded higher as investors awaited minutes of the European Central Bank’s September monetary policy meeting. India's services Purchasing Managers' Index or PMI missed estimates and fell to 54.3 in September from 57.2 in August.

Major Asian indices closed higher despite the US indices closing marginally lower on Wednesday. US stocks settled lower after strong US labour demand suggested the Federal Reserve could keep the federal funds rate higher for a more extended period. Previously, on Monday and Tuesday, US indices posted their best two-day rally since 2020. Brent crude oil futures traded lower after rising over 9% in the last three days. Crude oil prices rose over 2% on Wednesday after OPEC+ agreed to cut oil production by 2 million barrels per day to arrest a fall in crude oil prices.

Nifty Smallcap 100 and Nifty Midcap 100 closed in the green, following the benchmark index. Nifty Metal and Nifty Media closed sharply higher than Tuesday’s levels. Nifty IT closed in the green, following the NASDAQ 100 futures, which are trading higher.

Nifty 50closed at 17,316.30 (42, 0.2%), BSE Sensexclosed at 58,222.10 (156.6, 0.3%) while the broader Nifty 500closed at 15,042.90 (77.1, 0.5%)

Market breadth is overwhelmingly positive. Of the 1,938 stocks traded today, 1,340 were on the uptick, and 549 were down.

  • Stocks like Cochin Shipyard, Mazagon Dock Shipbuilders, Rites, and Zydus Lifesciences are in the overbought zone, according to the relative strength index or RSI.

  • HFCL is rising as it enters into an agreement with Qualcomm Technologies to design and develop 5G outdoor small cell products. The company believes its investment in 5G outdoor small cell products will lead to a faster rollout of 5G networks, improve user experience, and efficient utilisation of the 5G spectrum.

  • Sugar stocks Shree Renuka Sugars, EID Parry (India), Balrampur Chini Mills, Dalmia Bharat Sugar and Industries, among others rise by more than 3% in trade today. The sugar industry also trades in the green.

  • Electronics Mart’s Rs 500-crore IPO gets bids for 7.6X of the available 6.25 crore shares on offer on the second day of bidding. The retail investor quota gets bids for 7.8X of the available 3.1 crore shares on offer.

  • Sharekhan maintains its 'Buy' rating on APL Apollo Tubes with a target price of Rs 1,275 per share. This indicates an upside of 16.2%. The brokerage believes that the first mover advantage in structural steel tube space and a potential rise in margins will aid revenue growth. It estimates the company's net profit to grow at a CAGR of 33% over FY22-25.

  • Apollo Hospitals Enterpriseacquires a 60% stake in Kerala First Health Services through primary and secondary equity investment for a combined consideration of Rs 26.40 crore. Kerala First Health Services offers ayurveda medical care services under the brand AyurVAID Hospitals.

  • Macrotech Developers’ Q2FY23 bookings rise 57% YoY to Rs 3,148 crore and collections grow by 24% YoY on the back of robust demand. During the quarter, the company took on four new projects with a saleable area of 2.2 million square feet and a gross development value of Rs 3,100 crore. The stock makes it the screener which lists companies with an improving book value per share over the past two years.

  • SpiceJet rises on reports that the airline may get additional funds worth Rs 1,000 crore under the Emergency Credit Line Guarantee Scheme (ECLGS) in order to manage rising fuel costs and pay pending dues. The Centre raises the ELCGS limit for the aviation industry to Rs 1,500 crore from Rs 400 crore.

  • OPEC+ to cut oil production amid rising interest rates. The output will be cut by 2 million barrels per day.

  • Glenmark Pharmaceuticals rises after announcing the launch of lobeglitazone, an oral drug used for treating type 2 diabetes in adults. The company is the first to launch this drug in India. Oral anti-diabetic drugs in India had annual sales of Rs 11,725 crore for the 12 months ended August 2022.

  • Metal stocks like JSW Steel, Vedanta, Hindalco Industries, Jindal Steel & Power and Steel Authority of India (SAIL) are up by more than 2.5%. All constituents of the BSE Metal index are also trading in the green.

  • ICICI Securities continues to remain positive on the future growth prospects of Phoenix Mills as it retains its ‘Buy’ rating on the company with a target price of Rs 1,638. This implies an upside of 19%. The brokerage believes the company is well-placed to benefit from the revival in consumption across malls in India. This is due to its strong brand recall, market share leadership, robust pipeline of projects, and healthy balance sheet. It expects the company’s revenue to grow at a CAGR of 34.6% over FY22-25.

  • India’s September Services PMI falls to 54.3 compared to 57.2 in August as growth in the services industry falls to a six-month low amid inflationary pressures.

  • Larsen & Toubro's arm L&T Construction wins an order worth Rs 1,000-2,500 crore from an automobile company to construct a manufacturing facility in Haryana. The company also wins an order to construct a police reserve campus in Guwahati from the government of Assam.

  • JSW Energy is rising as its arm inks a pact with the state government of Maharashtra for a 960-MW hydropower plant in Raigarh.

  • JP Morgan upgrades its rating on Persistent Systems to ‘Overweight’ from ‘Neutral’ and raises the target price to Rs 4,100 from Rs 3,900. The brokerage says that having a defensive portfolio (isolation from reaction to broad market movements) and maximum revenue coming in US dollar is a sign of strength.

  • Media stocks Zee Entertainment Enterprises, PVR, Inox Leisure, among others are rising in trade. The broader Nifty Media index rises above 3%.

  • Happiest Minds Technologies rises after the board approves fund raising of Rs 1,400 crore via equity or debt bonds. The company shows up on a screener which lists stocks with strong cash-generating ability from core business.

  • Mahindra Lifespace Developers establishes a joint venture with Actis to develop industrial and logistics real estate facilities across India. The total combined investment in the joint venture over the initial years is estimated to be Rs 2,200 crore.

  • Indian Energy Exchange’s total production volumes fall 8% YoY to 8,160 million units. Supply issues continue because of the high prices of e-auction of coal and gas. However, according to National Load Dispatch Center’s data, energy consumption is up 11% YoY to 127 billion units.

  • Bajaj Finance’s Q2FY23 assets under management rise 30.8% YoY to Rs 2.1 lakh crore as new loans disbursed go up by 7.9% to 68 lakhs. The NBFC’s deposit book also grows 37% YoY in Q2. The company shows up on a screener of stocks with improving cash flow and good durability.

Riding High:

Largecap and midcap gainers today include JSW Energy Ltd. (330.65, 12.75%), Bharat Forge Ltd. (763.90, 8.05%) and Persistent Systems Ltd. (3,552.75, 7.69%).

Downers:

Largecap and midcap losers today include Godrej Consumer Products Ltd. (853.65, -4.79%), Gland Pharma Ltd. (2,074.80, -2.68%) and Lupin Ltd. (723.20, -2.57%).

Crowd Puller Stocks

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

Top high volume gainers on BSE included JSW Energy Ltd. (330.65, 12.75%), HEG Ltd. (1,186.15, 10.98%) and Sterlite Technologies Ltd. (180.70, 8.95%).

Top high volume losers on BSE were Godrej Consumer Products Ltd. (853.65, -4.79%), Sheela Foam Ltd. (2,736.20, -3.13%) and Galaxy Surfactants Ltd. (2,990.45, -0.48%).

Praj Industries Ltd. (443.65, 7.01%) was trading at 10.2 times of weekly average. Mishra Dhatu Nigam Ltd. (229.70, 7.26%) and Graphite India Ltd. (382.10, 5.29%) were trading with volumes 10.0 and 7.0 times weekly average respectively on BSE at the time of posting this article.

BSE 500: highs, lows and moving averages

18 stocks took off, crossing 52-week highs,

Stocks touching their year highs included - Cipla Ltd. (1,134.45, -0.89%), EID Parry (India) Ltd. (604.60, 2.54%) and IDFC First Bank Ltd. (54.30, 2.07%).

33 stocks climbed above their 200 day SMA including JSW Energy Ltd. (330.65, 12.75%) and Bharat Forge Ltd. (763.90, 8.05%). 6 stocks slipped below their 200 SMA including Lupin Ltd. (723.20, -2.57%) and NLC India Ltd. (69.15, -1.71%).

 
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The Baseline
04 Oct 2022
Five analyst stock picks from the banking and finance sector
By Suhas Reddy

This week, we look at five analyst picks from the banking and finance sector, which has been in the green over the past quarter.

  1. IndusInd Bank: Sharekhan maintains its ‘Buy’ rating on this bank with a target price of Rs 1,400. This indicates an upside of 19.8%. Analysts at the brokerage believe that “the bank is well positioned to resume on the path of higher credit growth, as it has recovered from past asset quality challenges''. They note that concerns over the bank’s asset quality are fading as its collection efficiencies, liquidity position, and internal costs have been improving for a few quarters. The bank’s credit costs are also expected to fall, and they anticipate a decline of 150 bps annually over FY23-25.

Sharekhan believes IndusInd’s loan disbursement growth will be driven by its vehicle finance, micro-finance and MSME business segments in the coming quarters. Overall, the company’s growth is expected to be broad-based. The analysts are positive about the firm’s foray into new segments such as NRI banking, tractor finance, and affordable housing. They expect the bank’s net profit to grow at a CAGR of  29.5% over FY22-25.

  1. Star Health and Allied Insurance: Motilal Oswal maintains a ‘Buy’ call on this insurance provider with a target price of Rs 830. This indicates an upside of 19%. Prayesh Jain and Nitin Aggarwal say, “Star Health outlined strong growth opportunities in the health insurance space in India. After the lifting of COVID-related restrictions, there is growing acceptance of the need for hospitalization, leading to larger customer walk-ins wanting to avail health insurance policies without being prospected.” 

According to the analysts, the insurance company is planning to expand its presence in rural India by creating a dedicated vertical for addressing demand from these geographies. Jain and Aggarwal expect Star Health to deliver an 18% gross premium CAGR over FY22-25, led by strong growth in retail health insurance and expect claim ratios to improve due to the pandemic receding. They also remain optimistic about the company due to its healthy earnings growth and limited cyclicality risk.

  1. Bandhan Bank: ICICI Securities maintains its ‘Buy’ rating on this bank but reduces its target price to Rs 408 from Rs 414. This implies an upside of 54.9%. Analysts Kunal Shah, Renish Bhuva, and Chintan Shah have cut their target price mainly due to the disruptions in collection efficiency and disbursements in Q1FY23. These disruptions were caused by the Assam floods and the revision in RBI regulations. However, they expect a recovery in the bank’s collection efficiency and disbursements in the coming months. They are constructive on mortgage lending growth as well.

The analysts say the bank is looking to open more than 500 branches in FY23, predominantly outside of its key markets Assam and West Bengal. Given these expansion plans, they expect the bank’s operating expenses to rise but the operating expenses to assets guidance of 2.6-2.7% to be maintained. They also see the firm’s increasing investment in technology as a key positive. They estimate the company’s net profit in FY24 to grow by 24.4% over FY23.

  1. Au Small Finance Bank: Axis Direct retains its ‘Buy’ rating on this small finance bank with a target price of Rs 705, implying an upside of 17.7%. The analysts at the brokerage expect the bank’s strong disbursement growth momentum to continue over the medium term. They see this growth led by vehicle finance, home loans, credit cards, and business banking segments. The bank’s asset quality recovery since the disruptions caused by the pandemic is a key positive. They expect its asset quality to further improve as “the restructured book has been exhibiting strong collection trends and slippages from the pool well below the anticipated levels”.

The analysts also expect the company’s net interest margin to remain stable despite an increasing interest rate environment. However, operating expenses can increase in the medium term as the firm is investing in expansion and technology. Nonetheless, Axis is positive about the small finance bank’s growth prospects given its stable NIMs and low credit costs, and the analysts expect the company’s net profit to grow at a CAGR of 26.3% over FY22-25.

  1. Union Bank of India: Motilal Oswal maintains a ‘Buy’ call on this public sector bank with a target price of Rs 50, indicating an upside of 14.8%. After attending the Union Bank’s thematic investor day on asset quality, Nitin Aggarwal, Yash Agarwal, and Vinayak Agarwal say, “The bank has segregated and shifted the loan portfolio to dedicated verticals, which focuses on marketing and general servicing.” The bank has opened 250 retail loan points, 125 MSME loan points, mid-corporate branches, and 13 large corporate branches to primarily focus on specific loan segments. 

The analysts note, “The bank saw recoveries of Rs 3,800 crore and is on track to achieve total recoveries of Rs 15,000 crore in FY23.” For FY23, they expect GNPA and NNPA to be at 9% and 3% respectively, and expect the slippages to moderate to less than 2%, with a credit cost of less than 1.7%. 

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

(You can find all analyst picks here)