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The Baseline
14 Feb 2022
Five analyst stock picks this week

  1. Balaji Amines: Edelweiss maintains a ‘Buy’ rating on this chemicals company and increases its target price to Rs 4,150. This indicates an upside of 42.9%. The company posted strong revenue growth of 44.1% YoY to Rs 565 crore and net profit growth of 19% YoY to Rs 90 crore in Q3FY22. The company’s performance is driven by higher realizations and robust performance by the subsidiary Balaji Specialty Chemicals. According to analyst Anshul Verdia, “Bottlenecks in the availability of key raw material ethylene oxide are easing off and may result in volume growth in the upcoming quarters.” Edelweiss remains positive about the chemicals company due to an increase in contribution from higher-margin products following removal of bottlenecks in its plants, commercialisation of dimethyl carbonate, and propylene glycol capacity by Q1FY23, and strong demand for products leading to improvement in utilization and realizations. Verdia also anticipates more capex announcements in the upcoming quarters.  

  1. TVS Motors: Axis Direct maintains a ‘Buy’ rating on this automobile company and increases its target price to Rs 720 with an upside of 9.8%. “TVS Motors posted a robust set of numbers in Q3FY22 with the performance ahead of our expectations, driven by improved product mix leading to strong ASP growth and margin beat”, says analyst Darshan Gangar.  The company’s Q3FY22 net profit grew 8.5% YoY to Rs 288 crore (25% higher than Axis Direct’s profit estimates) and net sales increased 5.8% YoY to Rs 5,760 crore (5% higher than Axis Direct’s estimates). The company is also witnessing strong sequential recovery across its portfolio in domestic as well as international markets. Considering the better business visibility, new product launches, and healthy demand and exports, Gangar expects the company's volumes to grow by 9.5% CAGR over FY 21-24 and expect robust revenue and earnings CAGR of 16% and 36% over FY 21-24.

  1. Aditya Birla Capital: HDFC Securities gives this financial services company a ‘Buy’ rating with a target price of Rs 157, indicating an upside of 38.3%. According to analysts Krishnan ASV, Deepak Shinde, and Sahej Mittal, the company is steadily repositioning its lending business mix towards retail, small and mid-size enterprise loans and this is reflected in improved franchise earnings. The insurance businesses are steadily building their profitability trajectory. The life insurance business, despite soft growth, witnessed a better net value of new business margins at 11.2% while the health insurance business remains on track to break even over the next couple of quarters. Along with Aditya Birla Capital, HDFC Securities is also bullish on the company’s asset management armAditya Birla Sun Life AMC with a target price of Rs 720.

  1. Affle (India): ICICI Securities gives this advertisement technology company a ‘Buy’ rating with a target price of Rs 1,500, indicating an upside of 27.3%. The company posted strong results for Q3FY22. The net profits increased 86.35% YoY and fell 20.9% QoQ to Rs 12.5 crore and revenue increased  125.5% YoY and 23.6% QoQ to Rs 339 crore. The EBITDA margin grew by 100 bps QoQ to 19.9%. The analyst Sameer Pardikar expects the company to add 600 croreconnected consumer devices globally by FY25. There is also a significant expectation of an increase in India’s digital user base from 52.5 crore in FY20 to 90.2 crore by FY25, at 11.4% CAGR. In the same period, mobile ad spending is expected to rise by 32.4% CAGR. “We expect 48% revenue growth in FY 21-24 (organic & inorganic combined),” says analyst Sameer Pardikar. 

  2. Union Bank of India: Motilal Oswal gives this bank a ‘Buy’ call with a target price of Rs 65 and an upside of 46.9%. Analysts Nitin Aggarwal and Yash Agarwal say “reported healthy earnings, supported by a pickup in loan growth and controlled provisions, as fresh slippage / special mention accounts moderated further.” The bank reported 49% YoY growth in profit to Rs 1,090 crore, supported by 10% YoY growth in core revenues. On the business front, loan books grew 6% QoQ to Rs 6.2 lakh crore. On the asset quality front, fresh slippage stood at Rs 3,410 crore due to slippage in the corporate portfolio. The total stressed book declined to 6% in December 2021 v/s 16% at the start of Covid-19. The analysts expect loans and deposits to grow in the 6–8% range. The company’s management expects loan growth to be likely at 11–12% for FY23. The analysts expect the improving asset quality will reduce net non-performing assets by 2.2% in FY23. The brokerage expects the bank’s return on assets and return of equity to be at 0.8% and 14%, respectively by FY24.

 
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The Baseline
11 Feb 2022
Five interesting stocks today

  • TVS Motor: With the auto sector going through turbulent times, this company managed to report a 6% YoY rise in total revenues to Rs 5,706 crore and a 9% rise in net profit to Rs 288 crore. Even with the ongoing semiconductor shortage and supply chain issues, TVS Motor’s material costs were flat on a  YoY basis but rose majorly by 7.2% on a QoQ basis to Rs 4,088 crore. This is a major feat for the company as it led to EBITDA margins seeing a growth of 50 bps to 10%. While brokerages Prabhudas Lilladher and Axis Direct continue to remain positive on the stock, Motilal Oswal is sceptical. Motilal Oswal expects a shit EVs to cause a major disruption in the scooter market.

TVS Motor created a new subsidiary for EVs and acquired a Switzerland-based company, Ego Movement. It also signed an MoU with the Tamil Nadu government of Rs 1,200 crore to set up a plant for the production of EVs. However, Motilal Oswal is of the opinion that the company earns nearly 40% of EBITDA from the domestic scooter business. So, even with an increase in EV production, sales and revenues are likely to take a hit in FY23. Other analysts, like Axis Direct and Prabhudas Lilladher remain positive because of increased earnings, especially from the export side as demand improves with African and Latin American markets opening up.

  • Narayana Hrudayalaya: This multispecialty healthcare service provider, which initially focused on cardiac and renal specialisations, has expanded to over 30 specialties over the years. These include cancer and neurosurgery. However, the cardiology-focused flagship hospitals continue to be the major revenue contributor. The company’s Q3FY22 consolidated net profit rose 2.4 times YoY to Rs 97 crore despite a revenue increase of 28% to Rs 966 crore as the operating profit margin increased by 425 bps YoY to 18.5%. 

The rise in profit was mainly led by higher profitability at flagship hospitals amid recovery in high-end cardiac elective surgeries. The waning of Covid-19 wave in the beginning of Q3FY22, and an increase in footfalls for medical tourism, helped flagship hospitals to post a robust profit growth. Though revenue from newly launched hospitals increased 21.5% YoY to Rs 90.4 crore, losses widened by 17% to Rs 48 crore. The new hospitals, which are based in Mumbai, Delhi, and Gurugram constitute 13% of the total revenues while the older hospitals contribute the rest. The company’s overall patients’ footfalls in India increased by 48.5% to 5.7 lakh mainly driven by an increase in outpatient (OP) footfalls.

The increase in revenue is partly attributable to the pent-up demand for specialised elective surgeries after the second wave of the pandemic waned. With the stock hitting a new one-year high in the past week, brokerages like ICICI Securities and HDFC Securities continue to be positive on this company as they see profits rising led by a turnaround in new units. Another Covid-19 wave and a delayed breakeven of newer hospitals pose a risk for the company while the flagship hospitals continue to boost profits.

  • Bata India: The company delivered a stellar Q3 backed by a robust festive season, but does it hold a promise beyond its seasonally strong quarter? The company reported revenue growth of 37% YoY to Rs 841.3 crore. According to ICICI Direct, the revenue recovery rate is at 101% of pre-Covid levels indicating a good quarter for the footwear company. Gross margins also improved 114 bps YoY to 52.7% because of a change in product mix, but this is still below pre-Covid numbers. Although net profits tripled to Rs 72 crore, the highest profit reported in the last eight quarters, total expenses also rose 28.9% YoY to Rs 758 crore. Expenses rose because of a 19% YoY increase in employee costs to Rs 105 crore and an increase in raw materials expense by 34% to Rs 398 crore. Employee costs increased because of variable incentives given by the company and input cost inflation has hit almost every sector in the economy. However, even with such robust numbers, ICICI Direct reduced its target price for Bata India. The brokerage is cautious as the rise in revenue and profit may be seasonal, as consumer demand rose in Q2FY22 because of the festive season.  Investors and analysts will wait to see how the company performs with the shift in customer sentiment in absence of festive demand. The third wave could also play spoilsport with footfalls reducing in January 2022. Hence, it will be interesting to see how the company copes in Q4FY22.

  • Minda Industries:Shares of Minda Industries fell by more than 3% after the company’s Q3FY22 profit fell 13% YoY to Rs 118 crore despite a 7% rise in revenues to Rs 2,181 crore. Rising input costs hit the company’s bottom line. However, despite the disappointing quarterly results, Axis Direct upgraded its rating on the company’s stock to ‘Buy’ from ‘Hold’ and upgraded its target price of Rs 1,250 compared to Rs 1,000 earlier. The brokerage remains bullish on the stock as the company’s revenue growth is coming from entering into new markets by expanding its product portfolio and increasing its client base. The company has a diversified product portfolio, which helped it to benefit from an increase in content per vehicle.

The addition of new customers and products, and growth across segments coupled with new order wins bodes well. A Joint Venture agreement with FRIWO AG gives Minda Industries an early mover advantage in the EV segment, which led to an order book with an aggregate annual peak sales value of Rs 400 crore from new-age EV OEMs. The company's client base grew by adding two more EV OEMs. Order wins in the switches, alloy wheels and lighting segments also remain robust. Minda Industries is well positioned to benefit from the recovery in manufacturing activity by original equipment makers, and with the new product addition in EV two-wheelers, revenue is expected to increase in the coming years.

  • InterGlobe Aviation (IndiGo):The market leader of the aviation sector sprung a positive surprise for investors in Q3FY22. The stock of InterGlobe Aviation is up nearly 15% in the past week. IndiGo generated a net profit of Rs 129.8 crore in Q3FY22 as against a net loss of Rs 620 crore in Q3FY21. The company achieved this feat after 7 quarters owing to a massive jump of 86% in its Q3 revenues. IndiGo’s passenger ticket revenues rose nearly 2X to Rs 8,073 crore in Q3 owing to a robust holiday and festive season. Notably, the government also withdrew the cap imposed on airline capacity from October 18, 2021.  While the company deployed 50% more capacity (at 88% of pre-Covid levels) in terms of available seat kilometres in Q3, its passenger load factor improved by 7.7 percentage points backed by higher passenger influx. Company’s yield/km also rose 19% YoY to Rs 4.41 owing to pent-up leisure travel demand as well as recovery in the international travel segment. Amidst these positive developments, a 186% YoY spike in fuel costs stuck out as a sore thumb. To meet the current inflationary trends, the company plans to replace most of its A320 Ceo aircrafts with the fuel efficient A320 Neo series by end of FY22.

While the going was good in Q3, IndiGo witnessed travel bookings fall on a daily basis between mid-December and mid-January. Hence, the third Covid-19 wave is likely to weigh heavily on the company’s Q4FY22 performance. IndiGo is certainly hopeful of a better FY23 with the new Managing Director Rahul Bhatia’s astute focus on the high-margin international travel segment and smaller cities in India. Bhatia also happens to be one of the co-promoters of the company and his presence at helm of affairs at IndiGo signifies his clear win in the long standing conflict between him and Mr. Gangwal.

 
Trendlyne Marketwatch
Trendlyne Marketwatch
11 Feb 2022
Market closes lower, SJVN's Q3 profit rises 19% YoY

Trendlyne Analysis

Nifty 50 ended the week in red after recovering from the day’s low with India VIX surging more than 5%. Investors were spooked by the high US inflation number of 7.5% for January 2022. This could lead to an accelerated rate hike or tightening of liquidity by the US Federal Reserve.

All sectoral indices traded in the red with Nifty IT and Nifty PSU Bank underperforming the benchmark index. Nifty Smallcap 100 and Nifty Midcap 100 settled in the red after trading in red throughout the day.

Nifty 50 closed at 17,374.75 (-231.1, -1.3%) , BSE Sensex closed at 58,152.92 (-773.1, -1.3%) while the broader Nifty 500 closed at 14,891.30 (-220.9, -1.5%)

Market breadth is highly negative. Of the 1,843 stocks traded today, 362 were gainers and 1,463 were losers.

  • Motherson Sumi’s Q3FY22 profit falls 70.2% YoY to Rs 377.84 crore and revenue dips 5.34% YoY to Rs 16,240.17 crore. The fall in profit can be attributed to declining product demand from outside India and high input costs.

  • ICICI direct maintains a 'BUY' rating on Aster DM Healthcare with a target price of Rs 250 with an upside of 30%. The brokerage is positive on the company’s long-term growth prospects on the back of its expansion plans in India with a calibrated capital expenditure approach

  • Zomato’s Q3FY22 loss falls 85% QoQ to Rs 63.2 crore on the 100% sale of its stake in Jogo Technologies for a total consideration of Rs 375 crore. Revenues rise 8.5% QoQ to Rs 1,259.7 crore as total orders grow by 5% QoQ.

  • ICICIDirect maintains a 'BUY' rating on KPR Mill with a target price upside of 26%. This was on the back of robust revenue growth of 36% YoY in Q3 due to higher cotton yarn realizations and volumes in the garments division. The brokerage expects the company to clock earnings CAGR of 11% between FY22-24 backed by its two capex projects and higher export demand from US and European markets.

  • Amara Raja Batteries' QFY22 profit falls 25% YoY to Rs 145.3 crore while revenues rise 20% YoY to Rs 2,365 crore. The fall in profit is because of cost of materials rising by 33.6% YoY which negatively impacted the company's margins.

  • Bharti Airtel is falling as reports suggest the company's network across India faces an outage affecting its broadband and mobile users throughout the country.

  • SJVN's Q3FY22 net profit rises 19% YoY to Rs 235.5 crore while its revenues rise 14.4% YoY to Rs 610.5 crore. Power generation grows 15.6% YoY to 1,480 million units driving the overall revenue and earnings growth in Q3. The company also approves an interim dividend of Rs 1.15 per equity share.

  • Schneider Electric Infrastructure is trading with more than 35 times its weekly average trading volume. Solara Active Pharma Sciences, RHI Magnesita India, Quess Corp, and Shilpa Medicare are trading at more than four times their weekly average trading volumes

  • Hindalco's Q3FY22 net profit jumps nearly 2X YoY to Rs 3,675 crore and revenues rise 43.8% YoY to Rs 50,453 crore. The domestic aluminium business witnesses higher sales realizations and primarily drives the overall earnings growth in Q3. Hindalco's foreign subsidiary Novelis sees its profits grow 33% YoY to $259 million on account of lower interest expenses and higher revenues.

  • Krishna Institute of Medical Sciences is rising as its Q3FY22 profit rises 42.7% YoY to Rs 67 crore. Revenues are up 8.6% to Rs 276.3 crore as outpatient footfalls and elective surgeries reach pre-Covid levels.

  • Tata Chemicals' Q3FY22 net profit rises 69.4% YoY to Rs 340 crore while revenues rise 20.5% YoY to Rs 3,141.58 crore. The company said despite high input costs affecting the chemical sector, rise in demand due to the reopening of businesses improves margins during the quarter.

  • Hero MotoCorp's Q3FY22 net profit falls 31% to Rs 703.7 crore and revenue falls 18.5% to Rs 8,133.3 crore. Company's sales volumes fall 30% YoY to 12.92 lakh units owing to subdued consumer demand which inturn causes the double-digit decline in its topline. Higher input cost adds to the pressure on company's bottomline. Hero also announces an interim dividend of Rs 60 per share.

  • Dr Lal Path Labs is falling as its Q3FY22 profit is down 40.6% YoY to Rs 58.2 crore despite a 9.3% YoY increase in revenues to Rs 509 crore. Revenues from Covid-19 related portfolio decline sharply by 46.8% YoY to Rs 110 crore during the quarter.

  • Whirlpool’s Q3FY22 net profit falls 38% YoY to Rs 44.2 crore because of low demand and high input cost inflation. Revenues rise 3.2% to Rs 1541.9 crore because of calibrated increase in product prices offsetting the impact of high input costs.

Riding High:

Largecap and midcap gainers today include Varun Beverages Ltd. (936.50, 5.07%), JSW Energy Ltd. (341.30, 5.00%) and Gland Pharma Ltd. (3,543.15, 2.56%).

Downers:

Largecap and midcap losers today include Info Edge (India) Ltd. (4,595.65, -5.99%), Larsen & Toubro Infotech Ltd. (5,999.85, -5.03%) and Motherson Sumi Systems Ltd. (172.15, -4.55%).

Movers and Shakers

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

Top high volume gainers on BSE included RHI Magnesita India Ltd. (486.05, 14.35%), Rashtriya Chemicals & Fertilizers Ltd. (80.55, 3.60%) and Poly Medicure Ltd. (780.30, 2.13%).

Top high volume losers on BSE were Solara Active Pharma Sciences Ltd. (620.30, -19.99%), Supreme Petrochem Ltd. (645.20, -6.18%) and Tata Chemicals Ltd. (914.70, -4.70%).

Great Eastern Shipping Company Ltd. (321.60, 0.02%) was trading at 7.0 times of weekly average. Quess Corp Ltd. (641.30, -2.77%) and Akzo Nobel India Ltd. (1,890.45, 0.25%) were trading with volumes 6.1 and 6.0 times weekly average respectively on BSE at the time of posting this article.

BSE 500: highs, lows and moving averages

4 stocks hit their 52-week highs, while 13 stocks were underachievers and hit their 52-week lows.

Stocks touching their year highs included - Hindalco Industries Ltd. (542.70, -0.83%), Mahindra Lifespace Developers Ltd. (310.75, -3.13%) and Gujarat Narmada Valley Fertilizers & Chemicals Ltd. (565.90, -0.85%).

Stocks making new 52 weeks lows included - Akzo Nobel India Ltd. (1,890.45, 0.25%) and Bajaj Consumer Care Ltd. (172.80, -1.23%).

7 stocks climbed above their 200 day SMA including Rashtriya Chemicals & Fertilizers Ltd. (80.55, 3.60%) and Tata Steel Ltd. (1,254.45, 0.49%). 20 stocks slipped below their 200 SMA including Intellect Design Arena Ltd. (685.30, -4.83%) and Sonata Software Ltd. (777.85, -3.52%).

 
Trendlyne Marketwatch
Trendlyne Marketwatch
10 Feb 2022
Market closes higher, Nykaa's Q3FY22 net profit falls over 55% YoY

Trendlyne Analysis

Nifty 50 closed in the green amid low volatility as The Reserve Bank of India's Monetary Policy Committee maintained an accommodative stance while holding the repo rate at 4% and reverse repo rate at 3.35%. Nifty Metal traded in the green throughout the day and closed higher than Wednesday’s level. Nifty Metal, Nifty IT, and Nifty Media extended gains and traded in the green to outperform the benchmark index. Nifty PSU Bank index witnessed a volatile trading session and finally closed at Wednesday’s closing level. Investors will be waiting on the US inflation data to be released later tonight.

The Nifty 50closed at 17,605.85 (142.1, 0.8%) , BSE Sensexclosed at 58,926.03 (460.1, 0.8%) while the broader Nifty 500closed at 15,112.20 (95.9, 0.6%)

Market breadth is in the red. Of the 1,850 stocks traded today, 855 were in the positive territory and 964 were negative.

  • Bayer Cropscience, TeamLease Services, Aavas Financiers, and Orient Electric are trading with higher volumes as compared to Tuesday.

  • Stride Pharma Science is falling as it reports a loss of Rs 87 crore in Q3FY22 against a profit of Rs 75.8 crore in Q3FY21 with its revenues falling 4.9% YoY to Rs 797 crore

  • Edelweiss maintains a ‘BUY’ rating on Balaji Amines with a target price of Rs 4,150 per share. This indicates an upside of 29%. The brokerage is positive on the company as its revenue grew by 44% YoY to Rs 565 crore and net profit grew 19% YoY to Rs 90 crore. It expects a better performance in Q4FY22 owing to better availability of raw materials and an increase in production.

  • Mahindra & Mahindra's Q3FY22 net profit rises 155% YoY to Rs 1,353 crore due to continued growth from auto exports and farm equipment sector. The company's total revenue rises 8% YoY to Rs 15,239 crore.

  • Power Grid Corp's Q3FY22 net profit slips 2.2% YoY to Rs 3,293 crore despite revenues rising marginally by 3% YoY to Rs 10,723.6 crore. The company also approves an interim dividend of Rs 5.50 per share.

  • Quess Corp is trading with more than eight times its weekly average trading volume. Zydus Wellness, Aurobindo Pharma and Mahindra CIE Automotive are trading at more than five times their weekly average trading volumes

  • Media stocks like Network 18 Media & Investments, TV18 Broadcast, Saregama India and Inox Leisure are rising. The broader sectoral index i.e. Nifty Media is also trading up today

  • Nykaa's Q3FY22 net profit slumps 58% YoY to Rs 29 crore despite revenues rising 36% YoY to Rs 1,098.4 crore. Beauty and personal care segment clocks over 30% YoY growth in GMV while the fashion segment sees over 2X rise in its GMV driving the overall revenue growth. However, Marketing and advertising expenses jump 155% YoY which leads to the profit fall in Q3.

  • ACC's Q3FY22 net profit slumps 40.6% YoY to Rs 280.8 crore despite revenues rising marginally by 2% YoY to Rs 4,279.6 crore. Lower sales volumes owing to weak cement demand and an over 25% YoY rise in power and fuel costs lead to the fall in profits.

  • Tata Power's Q3FY22 net profit rises 71% YoY to Rs 426 crore on a 44% rise in revenues to Rs 10,913 crore. The strong performance is on the back of expanded operations in the Odisha discoms, higher project execution by Tata Power Solar Systems, and strong performance of all other businesses.

  • Solara Active Pharma Sciences touches the 20% lower circuit and hits a 52-week low on weak Q3FY22 results. The company reports an operating loss of Rs 81.7 crore in Q3FY22 against a profit of Rs 88.5 crore in Q3FY21. Also, Managing Director & CEO Bharath and Chief Operating Officer Rajesh Salwan resign on Wednesday. Rajesh Salwan’s resignation is effective from March 31, 2022. The company is finalizing a transition plan for Sesha’s exit.

  • Aurobindo Pharma’s Q3FY22 net profit falls 22.3% YoY to Rs 604.3 crore. Revenues decline marginally by 1% to Rs 6,002 crore as its US formulations revenue falls 13.4% to Rs 2,745 crore due to high input and freight costs.

  • Steel Authority of India's (SAIL) Q3FY22 net profit rises 12.5% YoY to Rs 1,443 crore as revenues are up 27% to Rs 25,246 crore. SAIL’s cost of materials more than doubled to Rs 13,284 crore because of an increase in the price of both imported and local coking coal.

Riding High:

Largecap and midcap gainers today include Adani Power Ltd. (122.75, 14.08%), Jindal Steel & Power Ltd. (440.90, 5.86%) and Max Healthcare Institute Ltd. (384.35, 5.40%).

Downers:

Largecap and midcap losers today include Varun Beverages Ltd. (891.35, -3.87%), Page Industries Ltd. (40,953.50, -3.45%) and Bharat Forge Ltd. (729.90, -2.41%).

Movers and Shakers

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

Top high volume gainers on BSE included Mahindra Lifespace Developers Ltd. (320.80, 19.72%), Adani Power Ltd. (122.75, 14.08%) and Redington (India) Ltd. (173.65, 6.66%).

Top high volume losers on BSE were Quess Corp Ltd. (659.60, -9.66%), FDC Ltd. (300.15, -4.21%) and Zydus Wellness Ltd. (1,567.90, -3.37%).

Mahindra CIE Automotive Ltd. (208.05, 0.90%) was trading at 9.2 times of weekly average. Aurobindo Pharma Ltd. (684.40, 4.32%) and General Insurance Corporation of India (140.00, 1.93%) were trading with volumes 7.4 and 6.8 times weekly average respectively on BSE at the time of posting this article.

BSE 500: highs, lows and moving averages

8 stocks made52-week highs, while 7 stocks tanked below their 52-week lows.

Stocks touching their year highs included - Cholamandalam Investment & Finance Company Ltd. (690.75, 1.14%), Hindalco Industries Ltd. (547.25, 0.91%) and Lakshmi Machine Works Ltd. (11,177.85, -4.40%).

Stocks making new 52 weeks lows included - Bajaj Consumer Care Ltd. (174.95, -2.24%) and Kansai Nerolac Paints Ltd. (509.05, -0.21%).

16 stocks climbed above their 200 day SMA including Infibeam Avenues Ltd. (44.30, 6.11%) and Radico Khaitan Ltd. (958.15, 5.36%). 9 stocks slipped below their 200 SMA including Bharat Forge Ltd. (729.90, -2.41%) and Ambuja Cements Ltd. (374.85, -2.08%).

 
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The Baseline
09 Feb 2022
Chart of the Week: Car retail sales rise month-on-month in January 2022

The narrative for the Indian auto industry has been bleak coming out of the pandemic, with the sector hit by rising costs, supply challenges and weak demand. And the clouds didn't part in January:retail sales for the auto industry across all segments fell 10.7% YoY to 14,39,747 units in January 2022. Car sales are down 10.1% to 2,58,329 units. But one thing to note here is that although Maruti Suzuki, Tata Motors, and Mahindra & Mahindra’s wholesales are erratic month-on-month from October 2021 to January 2022, retail sales are looking up.  

With the rise in input costs leading to a rise in car prices, the rising car retail sales might signal some hope for the India’s auto industry amid a stalled recovery. There is still plenty of catching up to do: when we look at retail sales on a year-on-year basis, market leader Maruti Suzuki’s retail sales fell 15% YoY in January 2022 to 1,20,114 units, but rose 15.4% MoM. Tata Motors’ retail sales grew 37% YoY to 32,408 units (up 4.7% MoM) while Mahindra & Mahindra’s car retail sales grew 22% to 18,638 units (up 4.2% MoM)

Another point to note here is the data put out by theEconomic Survey of India for 2021-22. The survey said the Indian passenger vehicle industry had a backlog of nearly seven lakh cars as of the end of December 2021. This means many customers are waiting for the delivery of their cars. But supply chain issues are causing long delays. A study in late 2021 also showed that nearly half of first-time buyers were preferring used cars to new cars. This might reduce future retail sales for car companies. So, while retail sales may be rising, carmakers maybe now competing with used cars as they work to liquidate the inventory at their dealerships.

 
Trendlyne Marketwatch
Trendlyne Marketwatch
09 Feb 2022
Market closes higher, IRCTC rises after its Q3 profit jumps 167.4% YoY

Trendlyne Analysis

Nifty 50 continued its climb throughout the day with low volatility to finish sharply higher in line with the Asian indices. All sectoral indices closed in the green, except the Nifty PSU bank index which opened higher than Tuesday’s closing levels but ended in the red at the end of the session. Nifty Auto and Nifty IT extended their gains and traded in the green to outperform the benchmark index. With a positive performance from the Indian indices today, investors will be waiting at the Reserve Bank of India’s Monetary Policy Committee's (MPC) meeting tomorrow

Markets closed up today. Nifty 50 closed at 17,463.80 (197.1, 1.1%) , BSE Sensex closed at 58,465.97 (657.4, 1.1%) while the broader Nifty 500 closed at 15,016.35 (159.3, 1.1%)

Market breadth is in the green. Of the 1,852 stocks traded today, 978 were gainers and 848 were losers.

  • Relaxo Footwears, Gujarat Pipavav Port, AIA Engineering, and Cholamandalam Financial Holdings are trading with higher volumes as compared to Tuesday.

  • Escorts’ Q3FY22 net profit declines 28% YoY to Rs 201.5 crore as revenue from operations is down 3% to Rs 1,957 crore. Revenues fell because of reduction in sales of agri equipment by 19.8% YoY as rural demand for tractors drops because of late monsoon and delayed harvest. The company’s revenues from construction equipment and railway equipment segments rise 12.8% and 48% YoY, respectively.

  • Endurance Technologies' Q3FY22 net profit falls 50.2% YoY to Rs 94.6 crore due to prolonged suspension of operations as a result of the Covid-19 pandemic. The company's total revenue falls 7.3% YoY to Rs 1,896.6 crore.

  • Abbot India is rising as its Q3FY22 profit rises 13.7% YoY to Rs 199.7 crore and revenues increase by 12% to Rs 1243 crore.

  • Larsen & Toubro receives a contract worth Rs 1,000-2,500 crore from Bangladesh Hi-Tech Park Authority to construct hi-tech IT parks at 8 locations across Bangladesh.

  • IRCTC is rising after its Q3FY22 net profit jumps 167.4% YoY to Rs 208.8 crore and revenues rise 141% YoY to Rs 556.5 crore. All-around topline growth across the catering and ticketing segments owing to higher leisure travel lead to the earnings growth in Q3. IRCTC also announces an interim dividend of Rs 2 per equity share.

  • Gujarat Gas' net profit falls 68.66% YoY to Rs 122.9 crore due to abnormally high LNG price volatility. The company's total revenue rises 81.62% YoY to Rs 5,276.5 crore despite a 0.6% fall in total sales to 11.39 million metric standard cubic metre per day.

  • Tasty Bite Eatables is trading with more than 23 times its weekly average trading volume. Endurance Technologies, Mahanagar Gas, Gujarat Gas, and Sun TV Network are trading at more than four times their weekly average trading volumes.

  • Gujarat Alkalies & Chemicals Q3FY22 net profit rises 502.3% YoY to Rs 201.8 Crore. Revenue rises by 64.1% YoY to Rs 1,077.6 Crore. A near 22 percentage points YoY rise in operating margin to 34.08% leads to a huge jump in profits.

  • Indraprastha Gas' Q3FY22 net profit falls 2% YoY to Rs 374.8 crore despite a 52% YoY rise in revenues to Rs 2,468.9 crore. Higher realizations and a sales volume growth of 22% YoY aids revenue growth. A surge in gas costs hit the company's net profit.

  • Glenmark Pharma rises as the company and SaNOtize Research & Development launch FabiSpray, a nitric oxide nasal spray for the treatment of adult patients with COVID-19 who have a high risk of progression of the disease.

  • Aster DM Healthcare is rising as its Q3FY22 profit rises 57% YoY to Rs 168 crore and revenues increase by 19% to Rs 2650 crore. The company continues to leverage its digital presence to provide comprehensive patient care through the 'one Aster' app.

  • NMDC's Q3FY22 net profit falls 2.8% YoY to Rs 2,048.4 crore despite revenues rising 35% YoY to Rs 5,874 crore. Higher realizations on iron ore sales drive the revenue growth in Q3. However, profit falls on account of higher operating expenses and an additional royalty of Rs 1,307 crore. NMDC also announces an interim dividend of Rs 5.73 per equity share.

  • Bharti Airtel’s consolidated Q3FY22 net profit falls 26.8% QoQ to Rs 830 crore as finance costs rise 10.2% QoQ to Rs 4,367 crore. Revenues increase by 5.4% QoQ to Rs 29,867 crore. The average revenue per user rose 6.5% QoQ to Rs 163 after a rise in mobile tariffs by end of November 2021

Riding High:

Largecap and midcap gainers today include Abbott India Ltd. (16,672.40, 7.13%), Coal India Ltd. (168.60, 5.41%) and SBI Cards and Payment Services Ltd. (863.70, 5.41%).

Downers:

Largecap and midcap losers today include Endurance Technologies Ltd. (1,462.15, -5.44%), Bank of Baroda (114.85, -2.63%) and Adani Total Gas Ltd. (1,765.00, -2.43%).

Volume Rockets

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

Top high volume gainers on BSE included Abbott India Ltd. (16,672.40, 7.13%), Sundaram Clayton Ltd. (4,199.30, 5.55%) and Rain Industries Ltd. (238.60, 5.48%).

Top high volume losers on BSE were BASF India Ltd. (2,958.15, -6.13%), Endurance Technologies Ltd. (1,462.15, -5.44%) and Mahanagar Gas Ltd. (799.30, -3.57%).

Tasty Bite Eatables Ltd. (12,832.35, -0.52%) was trading at 32.4 times of weekly average. Aster DM Healthcare Ltd. (192.95, 4.64%) and Gujarat Gas Ltd. (660.70, -0.62%) were trading with volumes 7.2 and 5.8 times weekly average respectively on BSE at the time of posting this article.

BSE 500: highs, lows and moving averages

6 stocks made 52-week highs, while 6 stocks tanked below their 52-week lows.

Stocks touching their year highs included - Bank of Baroda (1,14.85, -2.63%), Cholamandalam Investment & Finance Company Ltd. (682.95, 3.87%) and Lakshmi Machine Works Ltd. (11,691.95, 5.56%).

Stocks making new 52 weeks lows included - Indraprastha Gas Ltd. (387.10, -1.28%) and Kansai Nerolac Paints Ltd. (510.10, -1.66%).

16 stocks climbed above their 200 day SMA including India Tourism Development Corporation Ltd. (390.15, 4.58%) and Bharat Forge Ltd. (747.90, 3.39%). 13 stocks slipped below their 200 SMA including BASF India Ltd. (2,958.15, -6.13%) and Balaji Amines Ltd. (3,120.45, -3.18%).

 
Trendlyne Marketwatch
Trendlyne Marketwatch
08 Feb 2022
Market closes higher Vedant Fashions’ Rs 3,149.2-crore IPO oversubscribed by 2.5X of total shares on offer

Trendlyne Analysis

The Nifty 50 closed in the green after a volatile trading session to snap its three-day losing streak. The Nifty Midcap 100 and Nifty Smallcap 100traded in the red throughout the day and ended lower than their previous close. Nifty Metal and Nifty Pharma outperformed the benchmark index while Nifty Media and Nifty Energy ended in the red. Nifty ITcontinued its decline as  TCS closed in the red.

Nifty 50 closed at 17,266.75 (53.2, 0.3%) , BSE Sensex closed at 57,808.58 (187.4, 0.3%) while the broader Nifty 500 closed at 14,857.05 (-13.6, -0.1%)

Market breadth is overwhelmingly negative. Of the 1,851 stocks traded today, 437 showed gains, and 1,395 showed losses.

  • Gillette India, Gland Pharma, GlaxoSmithKline Pharmaceuticals, and Max Healthcare Institute are trading with higher volumes as compared to Monday.

  • Suven Pharmaceuticals is rising as its profits rise 40.8% YoY to Rs 160 crore and revenues rise 63% to Rs 456 crore. The company continue to focus more on the business of Contract Development and Manufacturing Operations.

  • HDFC Securities downgrades rating on Radico Khaitan to 'Reduce' and cut its target price by 21% to Rs 950. Even though the company's posted double digit revenue growth in Q3FY22, the brokerage changes its stance owing to Radico's upcoming capex plan. HDFC Sec believes that the capex of Rs 740 crore which will be partially funded by debt will add to the balance sheet risk and affect cash flows post FY24 should the demand be subdued.

  • Vedant Fashions’ Rs 3,149.2-crore IPO gets bids for 2.5X of the available 3.64 crore shares on offer on the last day of bidding. Retail investors quota of 1.28 crore shares is subscribed around 39%. The IPO is entirely an offer for sale by selling shareholders.

  • Dilip Buildcon's arm Bangarupalem Gudipala Highways wins order worth Rs 1,060 crore from National Highways Authority of India to construct Bangalore-Chennai expressway of 29 kilometre.

  • Action Construction Equipment's Q3FY22 net profits fall 11.5% YoY to Rs 27.4 crore despite revenues rising 9% YoY to Rs 441.5 crore. Robust growth in the material handling and construction equipment segments aids the overall revenue growth. However, higher raw material costs (steel, rubber) leads to a profit decline in Q3FY22.

  • Minda Industries' Q3FY22 net profit slips 6.6% YoY to Rs 101.3 crore despite revenues rising 21.1% YoY to Rs 2,194 crore. Robust growth in the castings and wireless charging segments aid the revenue growth in Q3. Although net profit improves sequentially, it falls on a YoY basis due to higher input costs.

  • Johnson Controls-Hitachi Air Conditioning India is trading with more than 11 times its weekly average trading volume. SIS, Polyplex Corporation, TVS Motor Company, and Alembic Pharmaceuticals are trading at more than three times their weekly average trading volumes.

  • CDSL's Q3FY22 net profit jumps 56% YoY to Rs 83.7 crore and revenues rise 76% YoY to Rs 163 crore. The depositary activity segment which is market-linked posted over 60% YoY revenue growth led by record demat account additions of 91 lakh in Q3FY22.

  • Wockhardt is rising as it gets Drugs Controller General of India's approval to export up to 80 million doses of Sputnik Light and up to 20 million doses of Sputnik V Component I vaccine. The company enters into an agreement with the Russian Direct Investment Fund and Enso Healthcare to manufacture and supply Sputnik V and Sputnik Light Covid-19 vaccines.

  • Wipro inks a pact with Intel Foundry Services' Accelerator Alliance that supports innovation in chip design and manufacturing. Wipro and Intel will work on creating chip designs and solutions for large companies across sectors. This will help Wipro gain know-how on cutting-edge process and packaging technologies.

  • Jindal Stainless is falling despite a rise in Q3FY22 net profits by 156.04% to Rs 435.5 crore. Strong product mix, high demand, and increased exports leads to an increase in net profits. The company's total revenue rises 58.1% YoY to Rs 5,682.4 and EBITDA stands at Rs 809.17 crore, up 68.38% YoY.

  • GlaxoSmithKline Pharmaceuticals (GSK Pharma) is falling as its Q3FY22 profit falls 3.9% YoY to Rs 150.3 cr. Revenues rise marginally by 2.5% to Rs. 826.2 crore as third-wave of the pandemic impacts the company’s non-Covid 19 vaccines business.

  • TVS Motors Q3FY22 net profit rises 9% YoY to Rs 288 crore with revenues up 5.8% YoY to Rs 5,706 crore. EBITDA margins are up 50 bps to 10% despite raw material cost pressures.

Riding High:

Largecap and midcap gainers today include Bank of Baroda (1,17.95, 4.43%), SRF Ltd. (2,531.30, 3.28%) and Tata Steel Ltd. (1,219.60, 3.09%).

Downers:

Largecap and midcap losers today include Tata Power Company Ltd. (234.85, -6.73%), Sona BLW Precision Forgings Ltd. (625.40, -5.22%) and Adani Green Energy Ltd. (1,928.00, -4.77%).

Movers and Shakers

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

Top high volume gainers on BSE included SIS Ltd. (548.95, 4.37%), Rajesh Exports Ltd. (833.20, 4.13%) and TVS Motor Company Ltd. (656.50, 3.07%).

Top high volume losers on BSE were Poly Medicure Ltd. (764.30, -7.86%), Johnson Controls-Hitachi Air Conditioning India Ltd. (1,791.05, -4.09%) and Saregama India Ltd. (4,051.90, -2.37%).

Relaxo Footwears Ltd. (1,305.45, 0.89%) was trading at 6.2 times of weekly average. Gujarat Alkalies & Chemicals Ltd. (776.40, 2.66%) and Alembic Pharmaceuticals Ltd. (731.50, -0.17%) were trading with volumes 5.6 and 4.2 times weekly average respectively on BSE at the time of posting this article.

BSE 500: highs, lows and moving averages

5 stocks made 52-week highs, while 9 stocks tanked below their 52-week lows.

Stocks touching their year highs included - Bank of Baroda (117.95, 4.43%), SIS Ltd. (548.95, 4.37%) and Jindal Stainless Ltd. (211.30, -2.94%).

Stocks making new 52 weeks lows included - Indraprastha Gas Ltd. (392.10, -0.51%) and Kansai Nerolac Paints Ltd. (518.70, -2.93%).

6 stocks climbed above their 200 day SMA including Ratnamani Metals & Tubes Ltd. (2,184.95, 2.94%) and Birla Corporation Ltd. (1,328.10, 0.71%). 33 stocks slipped below their 200 SMA including Radico Khaitan Ltd. (890.40, -6.05%) and Balaji Amines Ltd. (3,222.80, -5.82%).

 
Trendlyne Marketwatch
Trendlyne Marketwatch
07 Feb 2022
Market closes lower, Indigo posts a profit of Rs 129.8 crore in Q3FY22, first time after Q3FY20

Trendlyne Analysis

Nifty 50 closed in the red with the Indian Volatility Index or India VIX rising 8% amid weak global cues as investors continue to keep track of the geopolitical situation in Ukraine. The US Federal Reserve FOMC and India's Reserve Bank of India's MPC meets are key triggers that investors are waiting on. Nifty PSU Bank index gave up most of its gains despite good Q3 earnings from State Bank of India. Nifty IT index traded lower throughout the day in line with NASDAQ 100 futures. Nifty Metal ended flat after heavy selling pressure at the end of the trading session. Only Nifty Energy and Nifty PSU Bank indices outperformed the broader markets to finish in the green.

Nifty 50 closed at 17,213.60 (-302.7, -1.7%) , BSE Sensex closed at 57,621.19 (-1023.6, -1.8%) while the broader Nifty 500 closed at 14,870.60 (-214.9, -1.4%) Market breadth is moving down. Of the 1,900 stocks traded today, 603 were on the uptrend, and 1,260 went down.

  • EPL, Procter & Gamble Hygiene & Healthcare, ICICI Lombard General Insurance, and AIA Engineering are trading with higher volumes as compared to Friday.

  • The New India Assurance Company is falling, after its gross written premium for January 2022 (GWP) decreases 9.4% YoY to Rs 2,239 crore. Its listed peer ICICI Lombard’s GWP rose 26.2% YoY to Rs 1,799 crore, but its stock is in the red during trade today.

  • Vedant Fashions’ Rs 3,149.2-crore IPO gets bids for 21% of the available 3.64 crore shares on offer on the second day of bidding. Retail investors quota of 1.28 crore shares is subscribed around 31%. The IPO is entirely an offer for sale by selling shareholders

  • Narayana Hrudayalaya is rising as its Q3FY22 profit jumps 2.4 times YoY to Rs. 97 crore and revenues rise 28% to Rs. 966 crore.

  • Edelweiss maintains a 'BUY' rating on Astral with a target price upside of 15%. The brokerage is positive on the company after it posted revenue growth of over 20% YoY and its net profit grew 3.2% YoY despite other PVC pipe players reporting a fall in their Q3 profits. Edelweiss also expects Astral to post 15% earnings CAGR in FY22-24

  • Interglobe Aviation is rising as it reports a profit of Rs 129.8 crore compared to a loss of Rs 626.6 crore in Q3FY21. This is the first time since Q3FY20 the company posted a quarterly profit. Revenues in Q3FY22 rise 89.3% YoY to Rs 9,295 crore and 65.73% QoQ

  • Ujjivan Financial Services is trading with more than 16 times its weekly average trading volume. Gujarat Narmada Valley Fertilizers & Chemicals, FDC, Tata Teleservices (Maharashtra), and Jubilant Pharmova are trading at more than seven times their weekly average trading volumes.

  • Affle (India) is rising as its Q3FY22 net profits surge 2X YoY to Rs 62 crore. Revenue from operations rise 125.5% to Rs 339.4 crore as revenue contribution from international clients increases to 50.3% from 48.8%. EBITDA grew 76% YoY to Rs 67.7 crore. Its main cost per converted user (CPCU) business grew 1.4X YoY in revenues to Rs 303 crore.

  • City Union Bank's Q3FY22 net profit rises 15.4% YoY to Rs 196.1 crore mainly due to lower provisioning. Net Interest Income rises marginally by 1% YoY to Rs 4,900 crore and advances rise 5% YoY to Rs 38,400 crore. Net NPAs rise sharply from 1.47% to 3.44% on a YoY basis in Q3FY22.

  • One97 Communications (Paytm) is falling (but recoups losses) as its Q3FY22 loss widens to 778.5 crore, mainly due to higher ESOPs costs. Revenues rise 88% YoY to Rs 1,456 crore driven by an increase in merchant payments processed through MDR (merchant discount rate) bearing instruments (Paytm Wallet, Paytm Payments Bank account, other banks' net banking, debit and credit cards), disbursements of loans on the platform, and recovery of commerce business from Covid impact.

  • Tata Steel's Q3FY22 net profit rises 159% YoY to Rs 9,572.7 crore and revenues rise 53.5% YoY to Rs 60,842.7 crore. Higher realizations backed by rise in steel prices drive the earnings growth on an YoY basis. However, the profit falls 20% sequentially due to higher coking coal costs and flat revenues.

  • Bayer Cropscience posts a profit of Rs 84.8 crore in Q3FY22 compared to a loss of Rs 45.1 crore. Revenues rose 6.7% YoY to around Rs 1,000 crore. The profits we boosted by a profit of Rs 58.5 crore from the sale of its seed business to Crystal Crop Protection.

  • SBI’s Q3FY22 net profit rises 62.3% YoY to Rs 8,432 crore with NII rising 6.5% YoY to Rs 30,687 crore. Gross NPAs drop 27 bps YoY to 4.5%, however, net NPAs rose 11 bps YoY to 1.34% as provisions for bad loans rose 35% to Rs 3,096 crore. The bank’s advances grew 8.47% YoY to Rs 26.6 lakh crore with foreign advances growing the highest by 22.3% in Q3FY22.

Riding High:

Largecap and midcap gainers today include InterGlobe Aviation Ltd. (2,170.10, 9.91%), Bank of Baroda (112.95, 6.01%) and Adani Green Energy Ltd. (2,024.65, 3.81%).

Downers:

Largecap and midcap losers today include Torrent Power Ltd. (524.10, -9.69%), Lupin Ltd. (804.70, -7.74%) and Apollo Hospitals Enterprise Ltd. (4,475.15, -4.54%).

Volume Shockers

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

Top high volume gainers on BSE included Gujarat Narmada Valley Fertilizers & Chemicals Ltd. (515.55, 13.26%), CreditAccess Grameen Ltd. (728.95, 11.16%) and InterGlobe Aviation Ltd. (2,170.10, 9.91%).

Top high volume losers on BSE were Jubilant Pharmova Ltd. (489.20, -7.09%), Radico Khaitan Ltd. (947.75, -3.05%) and Max Healthcare Institute Ltd. (349.50, -2.58%).

FDC Ltd. (306.00, 3.99%) was trading at 11.3 times of weekly average. Tata Teleservices (Maharashtra) Ltd. (172.20, 5.00%) and Gujarat State Fertilizer & Chemicals Ltd. (132.60, 2.55%) were trading with volumes 7.7 and 7.2 times weekly average respectively on BSE at the time of posting this article.

BSE 500: highs, lows and moving averages

12 stocks hit their 52-week highs, while 6 stocks tanked below their 52-week lows.

Stocks touching their year highs included - Bank of Baroda (112.95, 6.01%), Cholamandalam Investment & Finance Company Ltd. (650.10, -3.79%) and Deepak Fertilisers & Petrochemicals Corporation Ltd. (620.80, -5.00%).

Stocks making new 52 weeks lows included - Gillette India Ltd. (5,091.00, -0.52%) and Lupin Ltd. (804.70, -7.74%).

12 stocks climbed above their 200 day SMA including Hatsun Agro Products Ltd. (1,134.40, 4.55%) and Ratnamani Metals & Tubes Ltd. (2,122.60, 4.01%). 22 stocks slipped below their 200 SMA including KIOCL Ltd. (244.80, -5.13%) and Welspun India Ltd. (123.40, -4.53%).

 
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The Baseline
07 Feb 2022
Five analyst stock picks this week

  1. Oberoi Realty: Due to its focus on land acquisition and financial health Motilal Oswal gives this realty company a ‘Buy’ rating with a target price of Rs 1,200, indicating an upside of 26.8%. The company reported its highest ever quarterly sales of Rs 1,960 crore (up 102% YoY) in Q3FY22 driven by the successful launch of Goregaon project, Elysianand increased sales in its Borivali and JVLR projects. While revenue rose only 0.4% YoY to Rs 830 crore, net profits grew 62.9% YoY to Rs 460 crore as the company commenced profit recognition for its JV project in Worli. Analyst Pritesh Sheth and Sourabh Gilda think there are ample opportunities for business development. In addition, Oberoi Realty’s existing projects would be more than adequate to fund any land acquisition and management expects meaningful progress over the near term. “Without factoring in any further improvement in sales velocity for existing projects, its sales bookings are expected to see a 15% CAGR to Rs 5,000 crore over FY 21–24,” said the analysts. 

  2. Sun Pharmaceutical Industries: ICICI Direct maintains a ‘Buy’ rating on this pharma stock but increases its target price to Rs 1,075, indicating an upside of 20.3%. “Sun Pharma’s Q3FY22 operational performance was in line with I-Direct estimates with sustained momentum and good growth across businesses,” say analysts Siddhant Khandekar and Raunak Thakur. The company posted an 11.6% YoY increase in sales to Rs 9863.1 crore and an 11.1% YoY increase in net profits to Rs 2,058.8 crore. The analysts believe that higher contribution from specialty and the strong domestic franchise is likely to change the product mix towards higher margins by FY23. The company also adopted a strategy of signing contracts for gaining permission from innovators for manufacturing their latest generation patented products for the Indian market. The analysts believe the above strategy would have positive implications for margins. 

  3. UPL: Chola Wealth maintains a ‘Buy’ rating on this chemical company’s stock with a target price of Rs 940 with an upside of 22.5%. “UPL reported a robust performance for Q3FY22 as revenue beat our consensus estimates by 9%/10% on the back of strong volume (+11%) and improved price realization (+13%),” says analyst Nilesh Patil. The company’s revenues surged 24% YoY to Rs 11,300 crore and net profits grew 17.9% YoY to Rs 940 crore, 4% more than Chola Wealth’s estimates. UPL is set to sustain its strong earnings momentum in the near future on the back of robust agricultural demand and a better pricing environment. Analysts at Chola Wealth believe that enhancing market share, increasing the contribution of high margin bio-solutions business, and expanding geographical presence via acquisitions will act as a key growth catalyst.

  4. Crompton Greaves Consumer Electricals: Edelweiss maintains a ‘Buy’ rating on this company and has a target price of Rs 583 with an upside of 41.2%. The company reported soft numbers after delivering a strong performance in the last five quarters, which is a result of its long-term initiatives such as the go-to-market strategy, cost-saving measures, and leveraging of alternate channels. “But the company continued to gain market share in fans and achieved an all-time-high market share during the quarter, which will continue to benefit it in the coming years,” say analysts Praveen Sahay and Ajit Sahu. Revenues grew 4.6% to Rs 1,411 crore and EBITDA grew 0.7% to Rs 202 crore. Edelweiss revises FY22 and FY23 earnings downwards by 3.1% and 1.9%, respectively but still remains positive on the stock.

  5. Asian Paints: Ashika Research gives this paints company a ‘Buy’ rating with a target price of Rs 3,690 and an upside of 14.0%. Analysts at Ashika Research note, “The paint industry is expected to continue to report healthy volume growth led by immense demand for repainting as well from higher construction activities”. The analysts expect it to continue to grow at a CAGR of 13% to 14% between FY20 and FY24. The paints company has a two-year CAGR volume growth of 20.2% in 9MFY22. The company has lined up the next phase of growth from rural and Tier 3 and Tier 4 cities and is expanding its capacity in the next 2-3 years, according to management.  The paints company has also strategized to expand its retail footprint further on home décor and services portfolios to take its share in the total business to 17% to 18% in the next 2-3 years. Hence, the brokerage remains positive on the stock.

 
Trendlyne Marketwatch
Trendlyne Marketwatch
04 Feb 2022
Market closes in red, Vedant Fashions’ Rs 3,149-crore IPO gets bids for 14% of total available shares

Trendlyne Analysis

Nifty 50 ended in red after a volatile trading session. Vedant Fashions’ IPO procured bids for 10% of the shares on offer on day one. Nifty Realty traded in the red as it gave up most of its gains over the week as Godrej Properties plunged close to 10%. Nifty PSU Bank and Nifty Auto sectors ended the session in red after a good start at the beginning of the trading session. While the Nifty FMCG index traded flat even after ITC posted good Q3 results, Nifty Metal held its gains throughout the day to finish in the green.

Nifty 50 closed at 17,516.30 (-43.9, -0.3%) , BSE Sensexclosed at 58,644.82 (-143.2, -0.2%) while the broaderNifty 500closed at 15,085.45 (-50.5, -0.3%)

Market breadth is in the red. Of the 1,850 stocks traded today, 717 were in the positive territory and 1,097 were negative.

  • Gujarat Pipavav Port, Symphony, TeamLease Services, and Pidilite Industries are trading with higher volumes as compared to Thursday.

  • Alkem Laboratories’ net profit rises 16.6% YoY to Rs 525 crore due to a deferred tax writeback of Rs 162 crore. Total revenues increased by 13% YoY to Rs 2,619 crore. Domestic market saw a revenue growth of 19.9% led by strong product portfolio which benefitted form COVID-19 tailwinds. Revenues from international business declined marginally by 0.4% as US business continues to face significant pricing pressure.

  • Deepak Fertilisers and Petrochemicals Corporation hits a 52-week high as its Q3FY22 net profit rises by 75% YoY to Rs 58.7 crore. Revenue from operations grew by 27% to Rs 553.3 crore. A significant margin expansion in the chemicals segment and the mining chemical business delivered an outstanding quarter despite unfavourable raw material prices.

  • GAIL’s Q3FY22 net profits jump 2X YoY to Rs 3,800 crore with revenue from operations rising 67% to Rs 26,175.6 crore. The management says that the surge in numbers is because of better gas prices, improved gas marketing, and increase in sales of petrochemicals and liquid hydrocarbons. Revenues for natural gas rose by 86% YoY to Rs 22,092 crore and operating profit grew by 22.3% YoY to Rs 4,233 crore.

  • Vedant Fashions’ Rs 3,149.2-crore IPO gets bids for 14% of the available 3.64 crore shares on offer on the first day of bidding. Retail investors quota of 1.28 crore shares is subscribed around 22%. The IPO is entirely an offer for sale by selling shareholders

  • Lupin’s Q3FY22 net profit rises 24.5% YoY to Rs 546 crore due to a deferred tax writeback of Rs 524 Crore. Revenues increased marginally by 3.5% to Rs 4161 crore. The company’s inhalation portfolio continues to build share in the US and helped register double-digit growth sequentially amidst pricing and demand challenges on seasonal products.

  • Venky's (India) is trading with more than 10 times its weekly average trading volume. Torrent Power, Pfizer, Sumitomo Chemical India, and Lupin are trading at more than five times their weekly average trading volumes.

  • Indian Energy Exchange's January 2022 volumes rise 16% YoY to 8,652 million units (MU). Real-time electricity market's volumes rise 28% YoY to 1,575 MU while green market volumes stand at 280 MU.

  • JK Tyre and Industries is falling as the company's Q3FY22 net profits falls 53.78% YoY to Rs 57.9 crore but total revenue rises 15.12% YoY to Rs 2,130.4 crore YoY. The company's EBITDA stands at Rs 281 crore, down 44.6%

  • Prince Pipes and Fittings' Q3FY22 net profit stays flat at Rs 67 crore while revenues rise 21%YoY to Rs 665.7 crore. High realization growth despite a double-digit fall in sales volumes drive the topline growth in Q3. Profit growth remains dismal on the back of higher raw material costs.

  • ITC's Q3FY22 net profit rises 15% YoY to Rs 4,056.7 crore and revenues rise 30% YoY to Rs 18,787.7 crore. The company witnesses double-digit revenue growth across its segments with Agri business posting over 2X YoY revenue growth led by higher wheat, rice, spices, leaf tobacco exports. The company also announces an interim dividend of Rs 5.25 per share.

  • Radico Khaitan's Q3FY22 net profit falls 5.9% YoY to Rs 79 crore despite revenues rising 12% YoY to Rs 766 crore. The company's prestige and above brands post over 20% YoY growth driving the overall topline growth in Q3. However contraction in gross margins by 460 bps owing to high commodity price inflation cause the fall in earnings.

  • Dr Reddy’s Laboratories to acquire Nimbus Health, a privately owned German medical cannabis firm. The company will pay an upfront amount to acquire Nimbus Health, with performance and milestone-based earn-outs over the next four years.

  • Pfizer’s Q3FY22 net profit rises marginally by 2% YoY to Rs 144 crore despite a 14% increase in revenues to Rs 676 crore. Operating profit margin fell to 29%, declining close to 400 bps YoY.

  • Manyavar-owner Vedant Fashions raises Rs 945 crore by selling 1.09 crore shares at Rs 866 per share to anchor investors ahead of its IPO. The investors include Government of Singapore, Fidelity, Nomura, Abu Dhabi Investment Authority, Morgan Stanley Asia (Singapore) Pte, BNP Paribas Arbitrage, Societe Generale, HDFC Life Insurance Company, ICICI Prudential Life Insurance Company, SBI Mutual Fund, ICICI Prudential MF, Axis MF, Kotak MF, Aditya Birla Sun Life MF, among others.

Riding High:

Largecap and midcap gainers today include Torrent Power Ltd. (580.35, 7.50%), Cholamandalam Investment & Finance Company Ltd. (675.70, 5.13%) and Vedanta Ltd. (356.35, 3.20%).

Downers:

Largecap and midcap losers today include Godrej Properties Ltd. (1,506.90, -9.65%), Mahindra & Mahindra Financial Services Ltd. (153.75, -3.97%) and SBI Cards and Payment Services Ltd. (854.90, -3.35%).

Volume Rockets

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

Top high volume gainers on BSE included Mas Financial Services Ltd. (659.55, 16.59%), Spandana Sphoorty Financial Ltd. (415.75, 10.19%) and Torrent Power Ltd. (580.35, 7.50%).

Top high volume losers on BSE were Godrej Properties Ltd. (1,506.90, -9.65%), Venky's (India) Ltd. (2,398.80, -8.78%) and Radico Khaitan Ltd. (977.60, -6.86%).

Sumitomo Chemical India Ltd. (418.45, 6.06%) was trading at 12.2 times of weekly average. Pfizer Ltd. (4471.40, -2.12%) and Lupin Ltd. (872.20, -3.09%) were trading with volumes 10.4 and 6.4 times weekly average respectively on BSE at the time of posting this article.

BSE 500: highs, lows and moving averages

8 stocks hit their 52-week highs, while 2 stocks were underachievers and hit their 52-week lows.

Stocks touching their year highs included - Cholamandalam Investment & Finance Company Ltd. (675.70, 5.13%), Deepak Fertilisers & Petrochemicals Corporation Ltd. (653.45, 5.00%) and State Bank of India (530.30, -1.81%).

Stocks making new 52 weeks lows included - Akzo Nobel India Ltd. (1,902.45, -0.52%) and Multi Commodity Exchange of India Ltd. (1,427.85, -2.68%).

11 stocks climbed above their 200 day SMA including Hindustan Copper Ltd. (137.70, 6.46%) and MOIL Ltd. (178.95, 2.46%). 24 stocks slipped below their 200 SMA including Godrej Properties Ltd. (1,506.90, -9.65%) and Mahindra & Mahindra Financial Services Ltd. (153.75, -3.97%).