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Trendlyne Marketwatch
13 Sep 2022
Market closes higher, ICICI Securities keeps 'Buy' rating on DCB Bank

Trendlyne Analysis

Nifty 50 rose over 130 points and closed above the 18,050 mark, with the volatility index, India VIX, falling below 17.5%. European indices followed the global trend and extended their gains from Monday. India’s consumer price index or CPI rises to 7% in August, after falling to a five-month low in July. CPI print continues to stay above the central bank’s upper tolerance level of 6% for the eighth straight month. India’s industrial production or IIP rises 2.4% in July, missing analysts' expectations of 4.3%.

Asian indices closed in the green, tracking the US indices, which closed higher on Monday. US stocks rose ahead of the key US CPI print release scheduled later today. Brent crude oil futures traded marginally higher after rising about 7% in the last three trading sessions amid supply concerns.

Nifty Smallcap 100 and Nifty Midcap 100 closed in the green, following the benchmark index. Nifty Energy and Nifty FMCG closed higher than Monday’s close. Nifty IT closed flat despite the tech-heavy index, NASDAQ 100, rising 1.2% on Monday.

Nifty 50closed at 18,066.50 (130.2, 0.7%), BSE Sensexclosed at 60,571.08 (456.0, 0.8%) while the broader Nifty 500closed at 15,667.50 (90.1, 0.6%)

Market breadth is neutral. Of the 1,919 stocks traded today, 936 were on the uptrend, and 944 went down.

  • Stocks like Tata Investment Corp, Hindustan Aeronautics, Indian Railway Finance Corp, and Bajaj Holdings & Investmentare in the overbought zone, according to the relative strength index or RSI.

  • SRF rises as WTI crude and brent crude prices fall to $88.7 per barrel and $94.9 per barrel.

  • Harsha Engineers International, the iron & steel products manufacturer, opens for IPO subscription tomorrow. The price band for the issue is Rs 314-330 per share. The size of the issue is Rs 755 crore, comprising a fresh issue of Rs 455 crore and an offer for sale for Rs 300 crore. The risk factors for this company are its over-dependence on limited customers and outstanding litigations.

  • ICICI Securities maintains 'Buy' rating on DCB Bank with a target price of Rs 145. This indicates an upside of 38.1%. The brokerage believes that the bank's strong operational history, stable management team and improving credit growth revival will bode well for the stock. It estimates the bank's revenue to grow at a CAGR of 10.8% over FY22-24.

  • SRFand Ratnamani Metals & Tubeshit their 52-week highsof Rs 2,848.9 and Rs 1,968.2, respectively. SRF rises for two consecutive sessions, while Ratnamani Metals & Tubes rises in today's session.

  • Centre may announce changes in windfall tax and export duties on fuel after international crude oil prices fall in the past 15 days.

  • DB Realty rises and hits the upper circuit on reports of its merger with Adani Group’s real estate arm. The merger will lead to Adani Group infusing funds into DB Realty which may lead to a fresh issuance to new investors, according to reports.

  • Zydus Lifesciences receives final approval from the US Food and Drug Administration to market lenalidomide capsules. This drug is used to treat various types of cancers. The capsules had annual sales of $ 2.86 billion (approximately Rs 22,630 crore) in the US for the 12 months ended July 2022.

  • Healthcare Equipment & Supplies, Media, and Transportation sectors rise more than 12% in the past month.

  • Vedanta signs a joint venture agreement with Foxconn to set up a semiconductor plant in Ahemdabad, Gujarat, according to reports. The joint venture will invest Rs 1.54 lakh crore in the plant. Vedanta also obtains financial and nonfinancial subsidies on capex and cheap electricity from Gujarat for the plant.

  • Morgan Stanley expects India’s investment-to-GDP ratio to increase to 36% by FY27E. It says that reducing NPAs of banks and NBFCs, PLI schemes and improvement in government capex will boost India’s capex cycle in the coming years.

  • Motilal Oswal initiates coverage on Computer Age Management Services with a ‘Buy’ rating and a target price of Rs 3,000. This indicates an upside of 22%. The brokerage believes the company is well placed to benefit from the growing financialisation of savings in India, given its 70% market share in the mutual fund registrar and transfer agent industry. The brokerage expects the company’s net profit to grow at a CAGR of 15% over FY22-25.

  • India's Index of Industrial Production (IIP) growth falls to a four-month low at 2.4% in July compared to 12.7% in June, as the low base effect wanes. The manufacturing sector's growth slowed to 3.2% in July compared to 13% in June.

  • Dixon Technologies rises as its wholly owned subsidiary Padget Electronics receives approval from the Centre for disbursement of PLI (production-linked incentive). The subsidiary will receive an amount of Rs 53.2 crore as an incentive under the PLI scheme.

  • Abrdn Plc, promoter of HDFC Life Insurance, may sell 2% stake in the company through a block deal, according to reports. Abrdn Plc currently holds 3.72% stake in HDFC Life, as on June 2022.

  • IRB Infrastructure Developers is rising as its toll collections in August increase by 35% YoY to Rs 336 crore.

  • Indian rupee gains 25 paise to 79.28 against the dollar in early trade today.

  • Metal stocks like Vedanta, Jindal Steel & Power, National Aluminium among others are rising in trade. All constituents of the broader BSE Metal index are trading in the green.

  • India’s Consumer Price Index (CPI) stands at 7% in August against 6.7% in July. The rise in CPI is because of increase in prices of cereals, vegetables, and prepared meal snacks, among others. However, inflation in oils and fuel fell to 10.8% in August against 11.7% in July.

  • General Atlantic Singapore sells 22 lakh shares (2.7% stake) in Krishna Institute of Medical Sciences (KIMS) for Rs 275 crore in a bulk deal. In another deal, ICICI Prudential Smallcap Fund and ICICI Prudential Long-Term Equity pick up 20 lakh shares (2.5% stake) in KIMS for Rs 250 crore.

Riding High:

Largecap and midcap gainers today include PB Fintech Ltd. (565.05, 11.88%), Relaxo Footwears Ltd. (1,086.20, 7.60%) and Zomato Ltd. (65.45, 4.64%).

Downers:

Largecap and midcap losers today include Astral Ltd. (2,445.80, -4.17%), Tube Investments of India Ltd. (2,649.65, -3.14%) and Dr. Lal Pathlabs Ltd. (2,434.65, -2.46%).

Movers and Shakers

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

Top high volume gainers on BSE included KRBL Ltd. (365.05, 13.78%), Maharashtra Scooters Ltd. (5,130.30, 12.28%) and PB Fintech Ltd. (565.05, 11.88%).

Top high volume losers on BSE were Tata Communications Ltd. (1,236.05, -1.46%), Uflex Ltd. (772.70, -0.32%) and GlaxoSmithKline Pharmaceuticals Ltd. (1,417.70, -0.16%).

Relaxo Footwears Ltd. (1,086.20, 7.60%) was trading at 17.4 times of weekly average. Rallis India Ltd. (239.20, 4.91%) and Laxmi Organic Industries Ltd. (375.20, 7.92%) were trading with volumes 9.5 and 9.1 times weekly average respectively on BSE at the time of posting this article.

BSE 500: highs, lows and moving averages

34 stocks hit their 52-week highs, while 2 stocks tanked below their 52-week lows.

Stocks touching their year highs included - ACC Ltd. (2,572.80, 2.88%), Adani Ports & Special Economic Zone Ltd. (948.80, 1.10%) and Adani Transmission Ltd. (4,037.05, 0.78%).

Stocks making new 52 weeks lows included - Alembic Pharmaceuticals Ltd. (630.75, -0.83%) and Sanofi India Ltd. (6,077.70, -0.46%).

23 stocks climbed above their 200 day SMA including PNB Housing Finance Ltd. (402.50, 8.16%) and Rallis India Ltd. (239.20, 4.91%). 3 stocks slipped below their 200 SMA including TCNS Clothing Co. Ltd. (680.95, -2.17%) and Sobha Ltd. (707.70, -1.59%).

 
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The Baseline
12 Sep 2022
Five analyst stock picks trading in the PE Buy Zone
By Abhiraj Panchal

This week we take a look at five analyst picks that are also trading in the PE Buy Zone. The PE buy zone is a useful valuation check - it sees whether the stock trades at its current PE the majority of the time.

If the current PE is unusually low compared to where the stock usually trades, the stock is in the PE buy zone. If the current PE is unusually high for the stock compared to its previous history, it is in the PE sell zone. 

  1. Healthcare Global Enterprises: ICICI Securities maintains its ‘Buy’ rating on this healthcare facilities company with a target price of Rs 339, indicating an upside of 25%. This stock is currently trading in the PE Buy Zone.

Analysts Vinay Bafna and Rohan John are positive on the hospital chain as it focuses on its core competency area of oncology. They believe the firm’s “comfortable debt levels with limited capex plans provide room to explore additional growth opportunities and drive efficiency at the newer hospitals”. The analysts expect revenue from international tourists to increase, as it has hospitals across major cities in India. Revenue from international patients has already jumped to 1.5X of pre-covid levels, added the analysts.  

Analysts Bafna and John like the company’s strategy to strengthen its foothold in the oncology hospital space by focusing on acquiring standalone hospitals from tier-2 cities, where the cost of acquisition will be cheaper. HealthCare Global expects its newly acquired hospitals to be operational in 18-24 months, they added. The analysts expect the company’s net profit to grow at a CAGR of 29.2% over FY22-24.

  1. Home First Finance Company India: Motilal Oswal initiates coverage on this housing finance company with a ‘Buy’ rating and a target price of Rs 1,020. This indicates an upside of 16.6%. The stock is currently trading in the PE Buy Zone.

Analysts Abhijit Tibrewal and Nitin Agarwal expect the company’s assets under management (AUM) to grow on the back of its rising disbursements, co-lending partnerships and diverse marketing channel. The analysts added, “Home First’s first mover advantage in technology along with its strategic digital partnerships has resulted in robust underwriting, quicker turnaround and superior asset quality”.

The analysts believe the company is well placed to mitigate a potential margin compression given its cost efficiencies. They also anticipate the asset quality to remain stable and healthy as its net non-performing assets stood at 1.8% in FY22. Analysts Tibrewal and Agarwal expect Home First Finance’s AUM and net profit to grow at a CAGR of 29% and 24%, respectively, over FY22-25.

  1. Narayana Hrudayalaya: Prabhudas Lilladher maintains a ‘Buy’ rating on this healthcare facilities company with a target price of Rs 810, indicating an upside of 14.8%. The stock is currently trading in the PE Buy Zone.

Narayana Hrudayalaya inked an agreement with Shiva and Shiva Orthopaedic Hospital to acquire its orthopedic and trauma hospital (Sparsh unit) in Bengaluru on a slump sale basis for Rs 280 crore. Param Desai and Sanketa Kohale said, “Though the acquisition looks expensive, it will offer the entire spectrum of services in Health City.” They further added, “Sparsh unit possesses 100 operational beds since a decade, which has generated Rs 49 crore and Rs 18 crore revenues in FY22 and FY23 (4 months) along with healthy profitability.” 

The analysts believe that the company’s aggressive capex plans, which include a new Cayman unit, inorganic opportunities and greenfield/ brownfield expansion in India over the next three years will enhance growth visibility beyond FY24. Overall Desai and Kohale expect an EBITDA CAGR of 22% over FY22-24.

  1. Balkrishna Industries: Hem Securities initiates a ‘Buy’ call on this tyre manufacturer with a target price of Rs 2,293. This indicates an upside of 12.7%. The stock is currently trading in the PE Buy Zone.

The analysts note, “We believe Balkrishna Industries will continue to perform well over the next few quarters due to a robust demand environment.” They also believe that the company's export oriented business model, labor cost benefits and aggressive marketing may help them in outperforming its peers.

“With the help of capex, they are also increasing their capacity which will help them in gaining market share,” the analysts added. The tyre manufacturer is targeting doubling global market share to 10% vs. 5.5-6% currently, and its aggressive marketing and promotional activities are improving brand visibility. 

  1. IIFL Wealth Management: BOB Capital Market maintains a ‘Buy’ call on this financial services company with a target price of Rs 2,277, indicating an upside of 31.8%. The stock is currently trading in the PE Buy Zone. 

Mohit Mangal writes, “IIFL Wealth has successfully scaled its annual recurring revenue (ARR) business over the last three years and aims to have 80-85% of its topline from recurring streams,” and he believes this strategy will ensure a favourable asset mix of both debt and equity, and garner traction in the alternative investment space. 

This financial services company plans to target Rs 5-25 crore clients due to low competition levels and robust growth in clientele. Mangal remains positive on the stock and concludes, “The company has maintained a niche position in the under-penetrated wealth management business, enjoys a track record of innovative wealth products and has a strong team leader-driven model that boasts of low attrition at both the client and team level.”

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

 
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Trendlyne Marketwatch
12 Sep 2022
Market closes higher, Goldman Sachs overweight on ICICI Bank

Trendlyne Analysis

Indian indices closed in the green, with the volatility index, India VIX, at around 18%. The Nifty 50 rose around 90 points and closed above the 17,900 mark. European stocks followed the global trend and traded higher than Friday's close. Asian indices closed higher, tracking the US indices, which also closed in the green on Friday. The S&P 500 and tech-heavy index, NASDAQ 100, snapped their three-week losing streak and closed higher last week. Investors look ahead to India’s consumer price index or CPI print release today after market hours. Other CPI data releases globally such as US CPI and UK CPI prints are scheduled for this week. Brent crude oil futures traded above $90 per barrel after rising over 4% on Friday.

Nifty Smallcap 100 and Nifty Midcap 100 closed in the green, following the benchmark index. Nifty Bank and Nifty Realty closed higher than Friday’s levels. Nifty IT closed in the green, tracking the NASDAQ 100, which rose over 2% higher on Friday.

Nifty 50closed at 17,931.60 (98.3, 0.6%), BSE Sensexclosed at 60,115.13 (322.0, 0.5%) while the broader Nifty 500closed at 15,573.80 (106.4, 0.7%)

Market breadth is in the green. Of the 1,960 stocks traded today, 1,163 were on the uptick, and 743 were down.

Riding High:

Largecap and midcap gainers today include Hindustan Aeronautics Ltd. (2,614.00, 7.40%), Deepak Nitrite Ltd. (2,178.40, 6.54%) and ACC Ltd. (2,500.85, 5.72%).

Downers:

Largecap and midcap losers today include Coal India Ltd. (231.50, -2.57%), Bandhan Bank Ltd. (288.60, -1.67%) and Astral Ltd. (2,552.20, -1.62%).

Volume Shockers

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

Top high volume gainers on BSE included KEC International Ltd. (443.30, 9.40%), Welspun India Ltd. (82.20, 7.73%) and Hindustan Aeronautics Ltd. (2,614.00, 7.40%).

Top high volume losers on BSE were Krishna Institute of Medical Sciences Ltd. (1,241.00, -3.17%), Chemplast Sanmar Ltd. (419.65, -3.08%) and Medplus Health Services Ltd. (720.40, -2.11%).

AstraZeneca Pharma India Ltd. (3,315.90, 7.01%) was trading at 13.1 times of weekly average. Anupam Rasayan India Ltd. (781.05, -0.70%) and KNR Constructions Ltd. (249.10, -1.99%) were trading with volumes 10.1 and 8.3 times weekly average respectively on BSE at the time of posting this article.

BSE 500: highs, lows and moving averages

26 stocks hit their 52-week highs, while 1 stock hit its 52-week lows.

Stocks touching their year highs included - Adani Ports & Special Economic Zone Ltd. (938.50, 3.49%), Apollo Tyres Ltd. (284.00, 3.80%) and Bharat Electronics Ltd. (338.55, 3.17%).

Stock making new 52 weeks lows included - Natco Pharma Ltd. (602.55, 0.11%).

24 stocks climbed above their 200 day SMA including KEC International Ltd. (443.30, 9.40%) and Avanti Feeds Ltd. (507.35, 6.74%). 3 stocks slipped below their 200 SMA including KPR Mill Ltd. (597.30, -0.76%) and Rain Industries Ltd. (185.35, -0.16%).

 
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The Baseline
09 Sep 2022
Adani's wealth grows as others shrink; Indian companies plan 'once in history' capex spending

It's difficult for Indian parents to point to Gautam Adani while telling their kids, "Don't you want to become like him?" Adani is after all, a college dropout. He was probably the kid adults called "a bad influence". 

Now, to the frustration of Indian parents everywhere, Adani has become even richer, with Bloomberg placing him as the third wealthiest man in the world in 2022. 

In this week's Analyticks:

  • It's raining gold: Adani's wealth rose even as many billionaires became poorer
  • Capex spending is on fire for Indian businesses: Companies are scaling up investment to meet domestic demand

In 2020, Gautam Adani was far from wearing the "richest three" crown. He had just $10 billion in net worth and was behind Mukesh Ambani in the billionaire race. 

Come 2022, and how fortunes have changed. Adani has seen a jump in his net worth that beats any fairytale - it has multiplied 14X between Jan 2020 and now. He is now worth $143 billion, making him the third richest behind just Elon Musk and Jeff Bezos. Ambani is behind him, ranked tenth. 

Much of this wealth has been driven by the rise of Adani stocks, which are at eye-watering, triple digit PE valuations. Adani Green Energy trades at 764 PE, while Adani Transmission trades at 458 PE.

Compare this to Reliance Industries, which trades at 26.3 PE. Despite the octopus nature of Bezos' Amazon's business, it trades at 116 PE, while Musk's Tesla trades at 99.1. 

The rapid rise in Adani stocks over the last two years explains Gautam Adani's jump in the wealthiest list, even as other fortunes crumbled as markets turned volatile.  Musk and Bezos, for example, saw their net worth decline as the value of Amazon and Tesla stocks fell in the year to date. Adani is also well ahead of other Indian billionaires.

The Adani group currently has a combined market cap of over $250 billion (approximately Rs 20 lakh crore). However, the challenge is that these businesses are "deeply over-leveraged" and loaded with low cash flow and high debt, as a recent CreditSights report put it, which means that Adani's net worth “is paper wealth, and tied to the valuations of his holdings in the Adani Group’s stocks". There's also the concern of the group's non-transparent shareholding, with anonymized shareholders like the APMS Investment Fund holding large stakes in Adani companies.

Rising debt in Adani companies is in contrast to Reliance's efforts to sharply cut debt levels. The crown is shiny for Adani, but high levels of debt are a shaky foundation to build a business, or net worth on.  

Capex forecasts show aggressive spending plans in FY23

The outlook for India is brighter than the global economy, and that is showing up in the aggressive spending plans among Indian businesses. International as well as domestic analysts are bullish on spending, thanks to the healthy balance sheets of the Indian private sector, and rising domestic demand. Government policies have also been increasingly supportive of Indian industry, which is giving businesses confidence that the large investments they make will pay off. 

As a result, the planned capex for the year across major industries is soaring. This screener (subscriber) looks at the estimated annual capex spending for India's top businesses in FY23. Industries such as refineries, oil production, electric utilities and telecom are all seeing big spending estimates. 

This spending is partly driven by where India is on the development curve. As India's GDP ramps up, companies are building the "once in a country's history" essential infrastructure, that is needed to take the economy to the next level. This is like the infrastructure spending European and US economies saw in the 1950s and 1960s, and China saw in the 1970s as their GDP jumped. Large capex spends are being earmarked in critical sectors like metals, electric utilities, telecom and cement to meet the rising demands of Indian consumers.

For example, cement companies like Ultratech Cement and Grasim Industries have planned annual capex in the range of Rs. 50,000 crore. Sectors like auto are also seeing big outlays from companies like Tata Motors, as businesses focus on new models and the EV transition. 

Companies are also moving up the value chain as their prospects improve. Rising global market share for India's chemical and fertilizer companies are pushing them towards higher-margin specialty compounds, and they are investing to build capacity here. The major companies in real estate and retail such as Avenue Supermarts, Prestige Estates, and Phoenix Mills, have also earmarked annual capex in the range of Rs. 20,000 crore. 

The full screener on planned capex spends is here.

 
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The Baseline
09 Sep 2022
Five Interesting Stocks Today
  1. Ashok Leyland: This truck manufacturer’s stock touched its all-time high of Rs 169.4 on Tuesday and rose by 11.8% over the past month till Thursday. The surge in stock price comes on the back of a robust business outlook and a major deal win. This month, the company bagged orders worth $75 million to supply 1,400 buses in the UAE. This is the largest order for buses it has received in the UAE to date.

The company’s total wholesales for the month of August rose by 51% YoY, mainly driven by the surge in demand for trucks and buses. The management says the company’s diverse product portfolio mix and robust distribution network led to an increase in sales and market share. The firm’s domestic market share in trucks improved by 490 bps YoY to 31.1% in Q1. This healthy performance helped the stock make it to this screener which lists companies that outperformed their industry in the past 90 days.

The management expects the demand environment to improve due to increasing construction, infrastructure and mining activities. It also expects the re-opening of schools, colleges and offices to improve demand for buses. The light commercial vehicle segment’s sales volume will continue to grow on rising demand from the e-commerce and agriculture sectors. The street largely holds a bullish outlook for the stock, with a consensus recommendation of ‘Strong Buy’. According to KRChoksey, the company’s pipeline of new product launches will help increase its market share. The management anticipates better profitability in the coming quarters on softening commodity prices and a robust demand environment.

  1. Federal Bank:This bank's stock rose 9% in trade on Monday on speculative reports of the bank merging with another private bank. However, the bank denied the news and called it speculative. The stock tanked 8% after the bank issued this clarification. However, this did not affect the stock’s overall performance as it shows up in a screener where it is outperforming its industry by 14.2% in the past 90 days. It also shows up on the screener identifying stocks where FIIs increased their holding.

In a recent interview, the bank’s CEO Shyam Srinivasan said that rupee depreciation has helped improve the bank’s NRI (non-resident Indians) funds account. 21% of India’s remittances are now coming in through the bank. He also adds that earlier these funds were just lying with the bank, but now, the activity in these accounts has improved with investments into properties and other finances. He expects remittances to improve in the upcoming quarter. 

Recently brokerage Nirmal Bang gave a ‘Buy’ rating for this stock as its retail loan AUM (assets under management) improve to 55% in Q1FY23. It also expects asset quality to improve. What impressed the brokerage was the corrective measures taken by the bank to disburse small ticket-sized corporate loans to counter risk. The bank also reported an improved net interest margin to 3.2% in Q1FY23. However, the brokerage believes that the bank should have a higher contingency buffer.Trendlyne’s consensus recommendation saw 21 brokerages recommending a ‘Buy’ on the stock in September.

  1. Brigade Enterprises: This realty stock hit its all-time high of Rs 575.4 on Wednesday and has been on an upswing since announcing its Q1FY23 results on August 2. The company’s net profit rose over 4X YoY to Rs 87.7 crore beating Trendlyne’s Forecaster estimates by 161%. Its sales bookings in the residential segment jumped 70% YoY in the same period. The realty firm benefitted from the resurgence in demand for housing, office spaces, and travel as it is present in the residential, commercial, retail, and hospitality segments.

The management expects a favourable demand environment to continue over the coming quarters, and to meet this demand it has added projects worth Rs 500 crore in H2CY22. It plans to add more projects in the remainder of FY23. The company has been funding these projects from the proceeds from its qualified institutional placement (QIP), through which it raised approx Rs 500 crore. This has helped it maintain strong cash flows and a healthy balance sheet. It shows up on this screener which lists companies whose cash flows from operations have been consistently improving over the past two years.

Going forward, the management anticipates leasing out 1.7 million square feet of vacant space by the end of FY23. It expects the growth in rental income to be driven by a rise in demand for office space and retail space. The recovery in rental income will help reduce the risk associated with the residential segment, it added. In the coming years, the company plans to focus on increasing its presence in newer markets, specifically in the residential and commercial segments.

  1. Angel One:The stock of this broking company jumped nearly 14% after it released its business update for August 2022. The company also outperformed the Nifty 500 index by roughly 15 percentage points in the past week.Angel One acquired 4.5 lakh new clients in the month gone by, up by over 28% on a MoM basis. This is especially noteworthy as the company’s client acquisition run rate had fallen to 3.4 lakh clients in June and July after peaking in May.

The average daily  orders rose to over 36 lakh after continuously falling between February and July owing to tepid market activity and bearish sentiment. The Indian markets came alive in August backed by renewed investment fervor especially among foreign institutional investors. The FIIs pumped in roughly Rs 54,000 crore in the Indian equity markets in August, highest since December 2020. Higher market activity also caused Angel One’s average daily turnover to rise over 20% MoM across its product segments. However, the company ended up losing market share in the derivatives segment while it gained over 3% share in the commodities segment. Angel One now holds over 50% market share in the upcoming commodities segment. 

The company now has a client base of over 11 crore and its management is confident that strong client acquisition growth will continue, backed by higher participation of millennials in the markets. Prabhakar Tiwari, Chief Growth Officer, Angel One believes that the total number of demat accounts in the country will cross the 20 crore mark over the next three to four years, doubling from current levels. The company is also in the process of deploying its ‘Super App’ to deliver a personalised investment experience. Angel One beat consensus estimates of analysts in Q1FY23 and is all set to clock over 20% topline growth in FY23.

  1. One97 Communications (Paytm): This internet company re-appointed Vijay Shekhar Sharma as its MD & CEO in the last week of August. According to reports, it looks like the CEO is on borrowed time to convert its books to black, given the stock lost 60% of its value since its IPO in November 2021 and investors were not happy.

However, recently Paytm has been in the news for entirely different reasons. The stock fell 2.5% on September 3 after the ED raided the premises of Paytm along with Razorpay and Cashfree, on suspicion of a loan racket run around by Chinese nationals. According to reports, ED seized some Rs 17 crore worth of funds in the form of merchant IDs and bank accounts. Although the company gave an official clarification saying that none of the funds frozen by ED belongs to Paytm or its group companies, the investors are yet to gain their trust back in the stock. 

On September 6, the company published its monthly operational update. Given that the Reserve Bank of India (RBI) has banned Paytm from onboarding new customers, its monthly transacting users (MTU) are still up in August. However, this is just an 11.3% increase since the ban. The number of loans disbursed increased 246% YoY while gross merchandise value is up 72%. The management says that it is seeing a lot of upsell opportunities in this business. Paytm will have to focus on getting the maximum out of its existing users, given that it will take at least 3-5 months for the RBI to take a call on the imposed ban.

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
09 Sep 2022
Market closes higher, SKF India hits 52-week high

Trendlyne Analysis

Nifty 50 closed higher, with the volatility index India VIX trading below 3%. The S&P 500 and Dow Jones closed higher on Thursday. Brent crude is trading at $90 mark amid the global recession fears.

Nifty Smallcap 100 closed flat, even as the benchmark index trades higher. Nifty Bankclosed higher than Thursday’s levels. Nifty IT closes higher, taking cues from the NASDAQ 100, which closed higher on Thursday.

Nifty 50closed at 17,829.30 (30.6, 0.2%), BSE Sensexclosed at 59,793.14 (104.9, 0.2%) while the broader Nifty 500closed at 15,462.80 (22.1, 0.1%)

Market breadth is in the red. Of the 1,915 stocks traded today, 765 showed gains, and 1,105 showed losses.

  • Sharekhan maintains its ‘Buy’ rating on Coal India with a target price of Rs 280, according to reports. The brokerage believes the stock is trading at an attractive valuation and expects profitability to improve on high international coal prices and e-auction premiums.

  • Stocks like Astral, India Cements, Ambuja Cements, and Schaeffler Indiaare in the overbought zone, according to the relative strength index or RSI.

  • Vinati Organicsand SKF Indiahit their 52-week highs of Rs 2,361 and Rs 5,029.9, respectively. Both stocks rise for three consecutive sessions.

  • PI Industries in talks to buy out the promoter stake in Granules India, according to reports. Granules India's promoters have about 42% stake valued at Rs 3,200 crore.

  • Photographic Products, Plastic Products, Capital Markets, and Medical Equipmentindustriesrise by more than 9% in trade during the week.

  • Kaveri Seed Company rises as Massachusetts Institute of Technology and 238 Plan Associates buy stake in the company in an open market transaction. The companies now hold a 5.13% stake in Kaveri Seed.

  • Multiplex stocks like PVR and Inox Leisure fall more than 5% in trade today

  • Axis Direct maintains a ‘Buy’ rating on Mas Financial Services with a target price of Rs 840, indicating an upside of 14%. The brokerage remains optimistic about the company’s prospects due to its robust disbursement growth, improving net interest margin, and stable asset quality. It expects the company’s net profit to grow at a CAGR of 33.6% over FY22-24.

  • Lupin is rising as it launches a generic version of Suprep Bowel Prep Kit oral solution used in colonoscopy. The launch comes after it receives approval from the US FDA. The estimated annual sales of $ 202 million.

  • Aluminium companies like Hindalco Industries and National Aluminium Co are rising in trade due to an increase in prices of aluminium and other metals on the London Metal Exchange (LME).

  • Cement and construction stocks like Ambuja Cements, Shree Cements and Dalmia Bharat rise above 9% over the week, outperforming the sector.

  • The Society of Indian Automobile Manufacturers’ (SIAM) data shows August two-wheeler sales rising 16% YoY to 15.6 lakh units. Passenger car sales were up 21% YoY due to better supply of semiconductors and festive demand.

  • Samvardhana Motherson International is rising as it signs an agreement with Daimler India Commercial Vehicles’ (DICV) to acquire the assets of manufacturing and assembly operations at book value. The revenue generated from these assets is close to Rs 300 crore. The transaction is expected to complete by Q3FY23.

  • ICICI Securities downgrades its rating on Century Plyboards India to ‘Add’ from ‘Buy’, with a target price of Rs 750. This indicates an upside of 10.8%. The brokerage believes the company is currently overvalued but expects it to be a major benefactor of the rise in spending on home improvements post the pandemic. It estimates the company’s revenue to grow at a CAGR of 19.5% over FY22-24.

  • Mahindra & Mahindra launches the new XUV400 electric SUV on the eve of world EV day. The management is quite enthusiastic about this launch and plans to begin deliveries by the end of January 2023.

  • Rain Industries is falling as it temporarily closes an operating unit in Europe. The company is developing an energy-related contingency plan for its other European units anticipating a potential shortage of natural gas.

  • Zydus Lifesciences is rising as it receives the rights to market MonnoFerric injections in India and Nepal from Denmark’s Pharmacosmos A/S. The injection is used to treat iron deficiency in adults and is available in 30 countries.

  • Credit Suisse maintains its ‘Outperform’ rating on IndusInd Bank with a target price of Rs 1,280. The brokerage expects the bank's return on equity (RoE) to improve by 15% in FY23.

  • Reliance Power’s board approves the issue of equity shares/ convertible warrants to Varde Partners (a US investment firm) on the basis of preferential allotment. Varde Partners will buy a 15% stake for an amount of Rs 933 crore in the company.

  • PNC Infratech signs an agreement to build a four-lane highway for the National Highways Authority of India in the Sonauli-Gorakhpur section in Uttar Pradesh. The project cost is around Rs 1,458 crore and the company plans to complete the project in 24 months.

Riding High:

Largecap and midcap gainers today include Max Healthcare Institute Ltd. (413.30, 9.14%), Astral Ltd. (2,594.15, 4.97%) and Tube Investments of India Ltd. (2,745.20, 4.63%).

Downers:

Largecap and midcap losers today include Shriram Transport Finance Company Ltd. (1,324.10, -2.74%), Whirlpool of India Ltd. (1,754.30, -2.70%) and NHPC Ltd. (36.70, -2.52%).

Volume Shockers

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

Top high volume gainers on BSE included Allcargo Logistics Ltd. (381.55, 11.13%), Max Healthcare Institute Ltd. (413.30, 9.14%) and Nesco Ltd. (652.50, 7.67%).

Top high volume losers on BSE were Rain Industries Ltd. (185.65, -7.73%), Whirlpool of India Ltd. (1,754.30, -2.70%) and Endurance Technologies Ltd. (1,457.00, -0.69%).

Gujarat State Petronet Ltd. (254.00, 6.05%) was trading at 18.5 times of weekly average. Godrej Industries Ltd. (486.80, 4.21%) and Hatsun Agro Products Ltd. (1,126.45, 7.43%) were trading with volumes 10.4 and 10.1 times weekly average respectively on BSE at the time of posting this article.

BSE 500: highs, lows and moving averages

36 stocks took off, crossing 52-week highs, while 1 stock tanked below its 52-week lows.

Stocks touching their year highs included - Adani Ports & Special Economic Zone Ltd. (909.05, 2.71%), Ambuja Cements Ltd. (453.95, -1.72%) and Apollo Tyres Ltd. (273.60, -1.51%).

Stock making new 52 weeks lows included - Natco Pharma Ltd. (601.90, -0.84%).

22 stocks climbed above their 200 day SMA including Hatsun Agro Products Ltd. (1,126.45, 7.43%) and Gujarat Pipavav Port Ltd. (89.90, 3.69%). 6 stocks slipped below their 200 SMA including Rain Industries Ltd. (185.65, -7.73%) and Godfrey Phillips India Ltd. (1,114.00, -1.72%).

 
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Trendlyne Marketwatch
08 Sep 2022
Market closes higher, Jefferies maintains a ‘Hold’ rating on Hindalco

Trendlyne Analysis

Nifty 50 closed higher, with the volatility index India VIX trading below 19%. The S&P 500 and Dow Jones closed higher on Wednesday. Brent crude oil futures rises by 0.7% in today’s trading session. However, Brent crude fell to below its $90 mark amid the global recession fears.

Nifty Smallcap 100 also closed in the green, as the benchmark index trades higher. Nifty Bank and Nifty Financial Services closed higher than Wednesday’s levels. Nifty IT closes higher, taking cues from the NASDAQ 100, which closed higher on Wednesday.

Nifty 50closed at 17,800.10 (175.7, 1%), BSE Sensexclosed at 59,688.22 (659.3, 1.1%) while the broader Nifty 500closed at 15,441.75 (122.4, 0.8%)

Market breadth is in the green. Of the 1,928 stocks traded today, 1,111 were in the positive territory and 772 were negative.

  • InterGlobe Aviation sees a long build-up in its September 29 future series as its open interest rises 113% with put to call ratio of 0.71.

  • Tata Power’s arm Tata Power Renewable Energy partners with stainless steel manufacturer Viraj Profile to build a 100 MW solar power plant.

  • Tanla Platforms rises as its board approves the buyback of equity shares at Rs 1,200 per share for an aggregate amount of Rs 170 crore.

  • Zydus Lifesciences announces proof-of-concept for its molecule inhibitor ZYIL1 in its phase 2 clinical study. The study demonstrated that the inhibitor was successful in treating patients with a rare and lifelong auto-inflammatory condition called cryopyrin-associated periodic syndrome (CAPS).

  • ICICI Bank and SKF India hit their all-time highs of Rs 900.8 and Rs 5,008 respectively.

  • Jefferies maintains its ‘Hold’ rating on Hindalco, with a target price of Rs 390. The brokerage expects demand to grow by 3% during CY22-24. However, rising interest rates may affect demand.

  • Bonanza initiates coverage on Cera Sanitaryware with a ‘Buy’ rating and a target price of Rs 6,564. This indicates an upside of 19%. The brokerage expects the company’s profitability to improve on the back of robust demand, a diversified distribution network, record capacity utilisation, and its high market share. It estimates the company’s profit to grow at a CAGR of 24% over FY22-25.

  • Mahindra & Mahindra hits an all-time high of Rs 1,331.9, as it surpasses Tata Motors in terms of market cap. The company's market cap stands at Rs 1.65 lakh crore.

  • Porinju Veliyath and Litty Thomas acquire a 2.1% stake (1.6 lakh shares) in Duroply Industries via preferential allotment. This increases their shareholding to 7% from 4.9% as on September 2.

  • Special Consumer Services, Healthcare Services, and Other Non-Ferrous Metals industries rise more than 2% today.

  • Schneider Electric is rising as its board approves the expansion of production capacity of vacuum interrupters and vacuum circuit breakers. The company plans to set up a manufacturing unit in Kolkata with a capacity of 1.8 lakh MV.

  • ICICI Securities maintains its ‘Buy’ rating on Phoenix Mills with a target price of Rs 1,645. This indicates an upside of 18.7%. The brokerage believes the company will benefit from an increase in consumption across malls given its strong brand recall, market leadership, and a strong pipeline of projects. It expects the company’s revenue to grow at a CAGR of 50.2% over FY22-24.

  • Vodafone Idea is rising as the Ministry of Finance clears a proposal to convert the accrued interest on dues into equity, according to reports. The interest is Rs 16,130 crore. The government will hold a 33% stake once the deal goes through.

  • Paint stocks like Kansai Nerolac Paints, Asian Paints, Berger Paints, and Akzo Nobel India, among others, are rising in trade as crude oil prices fall.

  • Brent crude oil drops below $90 per barrel amid global recession fears. The oil benchmark, WTI falls to a 7-month low.

  • Sonata Software surges ahead of its record date for bonus issue of equity shares on September 10, 2022. The bonus issue is announced in the ratio of 1:3.

  • Retail sales for the automotive industry are up 8% YoY in August to 15.2 lakh units, according to data from the Federation of Automotive Dealers' Association. Two-wheeler retail sales rise 8.5% YoY. Retail sales of car makers are up 6.5% YoY.

  • PSU Banks like State Bank of India, Bank of Baroda, Canara Bank among others are rising in trade. All constituents of the broader Nifty PSU Bank index are trading in the green.

  • Standard Chartered Bank (Singapore) sells 2.7 crore shares (1.8% stake) in CG Power and Industries for Rs 595.3 crore in various bulk/block deals. In another deal, promoter Bharti Telecom buys 9.6 crore shares in Bharti Airtel for Rs 6,603.6 crore.

  • The Gangwal family, one of the promoters of InterGlobe Aviation, is to sell a 2.8% stake worth Rs 1,996 crore through a block deal. The shares will be offered to institutional buyers at a discount of 6.5% of the closing price of Rs 1,977 per share on Wednesday. The block deal will take place today.

Riding High:

Largecap and midcap gainers today include Bajaj Holdings & Investment Ltd. (6,373.25, 10.32%), Shree Cements Ltd. (24,458.45, 5.51%) and Patanjali Foods Ltd. (1,375.10, 4.82%).

Downers:

Largecap and midcap losers today include Hindalco Industries Ltd. (420.55, -2.84%), Endurance Technologies Ltd. (1,467.10, -1.96%) and Gland Pharma Ltd. (2,440.90, -1.91%).

Volume Rockets

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

Top high volume gainers on BSE included JK Lakshmi Cement Ltd. (556.25, 11.33%), Bajaj Holdings & Investment Ltd. (6,373.25, 10.32%) and Star Cement Ltd. (104.20, 7.31%).

Top high volume losers on BSE were MMTC Ltd. (38.50, -8.00%) and InterGlobe Aviation Ltd. (1,940.65, -1.87%).

Thyrocare Technologies Ltd. (688.95, 4.67%) was trading at 25.5 times of weekly average. Aarti Drugs Ltd. (466.15, 6.37%) and Indian Bank (203.55, 6.60%) were trading with volumes 14.4 and 7.7 times weekly average respectively on BSE at the time of posting this article.

BSE 500: highs, lows and moving averages

33 stocks overperformed with 52-week highs, while 2 stocks tanked below their 52-week lows.

Stocks touching their year highs included - Ambuja Cements Ltd. (461.90, 2.90%), Apollo Tyres Ltd. (277.80, 1.11%) and Astral Ltd. (2,471.40, 1.31%).

Stocks making new 52 weeks lows included - Natco Pharma Ltd. (607.00, -0.73%) and Sanofi India Ltd. (6,088.10, -0.24%).

22 stocks climbed above their 200 day SMA including JK Lakshmi Cement Ltd. (556.25, 11.33%) and Sonata Software Ltd. (571.30, 6.59%). 4 stocks slipped below their 200 SMA including Sobha Ltd. (715.10, -1.28%) and Tata Motors Ltd. (442.20, -0.82%).

 
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The Baseline created a screener Forecaster Annual Capex (Capital …
08 Sep 2022
Estimated capital expenditure for companies one year forward. Only non-zero values are shown.
 
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Trendlyne Marketwatch
07 Sep 2022
Market closes lower, ICICI Securities maintains 'Buy' on Angel one

Trendlyne Analysis

Indian indices closed lower with the volatility index India VIX closing 0.8% down today. European stocks trade lower. Most Asian indices either closed flat or lower as US indices closed in red on Tuesday.

Nifty Smallcap 100 and Nifty Midcap 100 closed in the green, despite the benchmark index closing lower. Nifty Auto closed in red while Nifty Realty closed flat. Nifty IT closed in the green, despite the NASDAQ 100 closing lower on Tuesday.

Nifty 50closed at 17,629.50 (-26.1, -0.2%), BSE Sensexclosed at 59,028.91 (-168.1, -0.3%) while the broader Nifty 500closed at 15,323.00 (10.0, 0.1%)

Market breadth is in the green. Of the 1,922 stocks traded today, 1,110 were gainers and 752 were losers.

  • Stocks like Rites, GMM Pfaudler, Vijaya Diagnostic Centre, and Astralare in the overboughtzone, according to the Money Flow Index or MFI.

  • Ambuja Cements touches its all-time high of Rs 446.5 today. This comes ahead of the closure of Adani Group’s open offer at Rs 385 per share, the open offer closes on September 9.

  • ICICI Securities maintains 'Buy' rating on Angel One with a target price of Rs 1,830, indicating an upside of 36.6%. The brokerage says that the company maintained its business momentum in August with 9% MoM increase in number of orders and 29% MoM rise in gross client acquisition. It estimates the company's revenue to grow at a CAGR of 12% over FY22-24.

  • Deutsche Bank expects India’s overall foreign exchange reserves to decline during FY23, due to the widening current account deficit and interference by the RBI to support the rupee.

  • Coal Indiaand Grindwell Norton hit their 52-week highs of Rs 238.6 and Rs 2,290, respectively. Both stocks rise for two consecutive sessions.

  • Tamilnad Mercantile Bank’s Rs 831.6-crore IPO gets bids for 2.9X of the available 87.1 lakh shares on offer on the last day of bidding. The retail investor quota gets bids for 6.5X of the available 15.8 lakh shares on offer.

  • FMCG stocks like ITC, Nestle India, Godrej Consumer Products, Britannia Industries, among others, are rising in trade as palm oil prices fall. The broader sectoral index Nifty FMCG is also trading in the green.

  • Aarti Industries is planning a capex outlay of Rs 3,000 crore for FY23-24. The company will focus on downstream products in existing and new chemistry value chains like chlorotoluene. It will also focus on custom manufacturing opportunities.

  • Cipla is rising as it receives the final approval for its abbreviated new drug application from the US Food and Drug Administration for lenalidomide (generic of revlimid). This drug is used to treat various types of cancer. Revlimid generated sales worth $2.58 billion in the US market over the past year till June.

  • CG Power is falling as around 1.3 crore equity shares trade in a block deal, according to reports.

  • Dixon Technologies is rising as Jefferies remains bullish on the stock with a target price of Rs 5,305, according to reports. The brokerage expects the company to outperform its industry on the back of new product launches, an expanding client base, and also benefit from the production-linked incentive (PLI) schemes.

  • Max Ventures and Industries' arm Max Estates acquires Acreage Builders for Rs 291.5 crore. The acquisition is to use Acreage Builders' assets, including the land holdings to develop a commercial project.

  • Axis Direct initiates coverage on Indian Hotels with a ‘Buy’ rating and a target price of Rs 360, indicating an upside of 16%. The brokerage believes the company is well-placed to benefit from the recovering hospitality and tourism industry given its robust cash flows, strategic measures, and proactive capex. It expects the company’s net profit to grow at a CAGR of 45.4% over FY23-25.

  • Food & Drugs Retailing, Commodity Printing / Stationery, and IT Consulting & Software industries fall more than 7% in the past month.

  • Zuari Industries is rising as it signs an MoU with Envien International and Zuari Envien Bioenergy. The company and Envien International will establish a joint venture with 50% stake each. The JV will construct and operate a 150-kilo litres per day ethanol distillery.

  • Cements stocks like UltraTech Cement, Ambuja Cements, Shree Cements, ACC, among others, are up by more than 3%. The cement & cement products industry is also rising in trade today.

  • Lupin is rising as it signs an exclusive license and supply agreement with DKSH to market biosimilars in the Philippines. According to this agreement, Lupin’s subsidiary Multicare Pharmaceuticals will be responsible for the approvals and distribution of biosimilars. The medicines will be used to treat bone-related disorders and in cases of oncology, ophthalmology, and immunology.

  • According to Morgan Stanley, India's upcoming capex cycle is signalling a good earnings season. The brokerage expects strong demand to drive further investments.

  • Bajaj Finserv’s subsidiary Bajaj Allianz Life Insurance Co’s total new business premium declines 25.4% MoM to Rs 669 crore. The new business premium falls as its group single premium declines by more than 2X MoM to Rs 232.2 crore.

  • Biocon sells 2.1 crore shares (5.4% stake) in Syngene International for Rs 1,220.3 crore in a bulk deal. In another deal, promoter Raja Ganesan Chandramohan sells 54.4 lakh shares (2.5% stake) in Hatsun Agro Products for Rs 537.4 crore.

  • InterGlobe Aviation (Indigo) appoints Pieter Elbers as its new Chief Executive Officer. His appointment came into effect on Tuesday.

Riding High:

Largecap and midcap gainers today include Container Corporation of India Ltd. (726.55, 8.55%), Shree Cements Ltd. (23,181.05, 7.05%) and Vodafone Idea Ltd. (9.75, 6.56%).

Downers:

Largecap and midcap losers today include Avenue Supermarts Ltd. (4,426.30, -2.87%), Tata Motors Ltd. (445.85, -2.60%) and InterGlobe Aviation Ltd. (1,977.70, -2.16%).

Crowd Puller Stocks

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

Top high volume gainers on BSE included Vakrangee Ltd. (37.05, 12.44%), Wockhardt Ltd. (278.00, 8.81%) and Container Corporation of India Ltd. (726.55, 8.55%).

Top high volume losers on BSE were Sunteck Realty Ltd. (451.20, -4.48%), Bharti Airtel Ltd. (753.10, -1.07%) and 3M India Ltd. (22,780.60, -0.89%).

JK Lakshmi Cement Ltd. (499.65, 6.63%) was trading at 9.2 times of weekly average. Edelweiss Financial Services Ltd. (66.80, 6.54%) and The Ramco Cements Ltd. (772.15, 1.72%) were trading with volumes 8.6 and 7.1 times weekly average respectively on BSE at the time of posting this article.

BSE 500: highs, lows and moving averages

23 stocks made 52-week highs, while 3 stocks were underachievers and hit their 52-week lows.

Stocks touching their year highs included - Ambuja Cements Ltd. (448.90, 2.84%), Apollo Tyres Ltd. (274.75, 0.84%) and Blue Dart Express Ltd. (9,050.70, 1.91%).

Stocks making new 52 weeks lows included - Alembic Pharmaceuticals Ltd. (633.85, -0.44%) and MphasiS Ltd. (2,083.95, 1.11%).

18 stocks climbed above their 200 day SMA including Vakrangee Ltd. (37.05, 12.44%) and Angel One Ltd. (1,486.65, 7.18%). 8 stocks slipped below their 200 SMA including Tata Motors Ltd. (445.85, -2.60%) and Sheela Foam Ltd. (3,117.40, -2.39%).

 
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The Baseline
07 Sep 2022
Chart of the Week: India has a young working population. But it may not fully benefit from it
By Abdullah Shah

The Reserve Bank of India (RBI) projects India’s GDP to grow by 7.2% in FY23, which places the country among the fastest growing economies in the world. One of the reasons for the rapid growth is that India entered a demographic dividend starting 2018. 

A demographic dividend occurs when a country’s working population is larger than its dependent population. When people have fewer dependents (children and elderly parents), they tend to take more risks, travel for work, and also take up high-productivity jobs. This drives higher GDP growth. 

The ratio of India’s working population to total population is currently higher than countries like China, Japan and Brazil. The population of these countries have already started to decline, while India’s working population will increase till 2045. It will also exceed China’s population by 2030. 

While having a large labour force is an opportunity for countries, translating it into high growth is not straightforward. India has not made significant headway in skilling and educating its workforce. And almost 83% of the workforce is employed in the unorganised sector. 

Employability of India’s workforce was 47.4% in 2019. It fell to 46.2% in 2022 due to the lockdown restrictions during the COVID-19 pandemic owing to online classes, as well as long school and college closures. 

As India shifts from an agricultural nation to a manufacturing/services economy and an exporting powerhouse, policy-makers will have to focus on increasing employability, and bringing more people into the organized sector. It also needs to increase labour participation for women. India currently ranks 178 out of 187 countries in female workforce participation according to the World Bank and its female labour participation rate is 19%, among the lowest in the world.