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The Baseline
23 Aug 2024
Five Interesting Stocks Today - August 23, 2024

1. Zomato: 

This internet software & services company has risen 18.5% over the past month, driven by its plans to acquire One97 Communication’s (Paytm) entertainment ticketing business and positive Q1FY25 results. On Thursday, the company entered an agreement with Paytm to acquire its movie, sports, and events ticketing businesses for Rs 2,048 crore. On Tuesday, Antfin Singapore reportedly sold 20.7 lakh shares (or 2.2% stake) in Zomato worth $556 million (approx Rs 4,667.6 crore) in a block deal. 

In FY24, Paytm’s entertainment ticketing business had a revenue of Rs 239.2 crore. Paytm will transfer the ticketing business to its subsidiaries, Wasteland Entertainment and Orbgen Technologies which will then be acquired by Zomato for Rs 783.8 crore and Rs 1,264.6 crore, respectively. At the company’s concall with Emkay, the Zomato management said that it believes going-out experiences will see strong growth, with traction in lifestyle and consumption. It expects the going-out segment’s gross order value (GOV) at more than Rs1 lakh crore in FY26 with a break-even EBITDA margin. 

The stock had surged by 13.6% in two sessions after posting its Q1FY25 results on August 1, where its revenue and net profit grew by 71% YoY and 126.5x YoY to Rs 4,442 crore and Rs 253 crore, respectively. Both revenue and net profit beat Trendlyne’s Forecaster estimates by 7.5% and 16%. Revenue got a boost from  improvements in the food ordering and delivery, Hyperpure supplies, and quick commerce (Blinkit) segments. The surge in net profit was led by lower overhead costs. 

Deepinder Goyal, Founder & CEO of the company, was bullish on delivery, saying, “We expect the food delivery segment to grow by 25% YoY in FY25. EBITDA margin has been expanding over time and we expect it to reach the range of 5%. Food gross order value (GOV) grew 25%, going forward, we expect it to be closer to the industry average of 30%.”

Motilal Oswal maintains its ‘Buy’ call on Zomato with a higher target price of Rs 300 per share. This indicates a potential upside of 14.2%. The brokerage believes that on its own, the ticketing business could be a small part of Zomato’s business, but if executed correctly, could give Zomato strong revenue growth. It expects the company’s revenue to grow at a CAGR of 37.6% over FY25-26.

2. Central Depository Services (India):

This depository company surged to a new 52-week high of Rs 1664.4 on Friday after rising 22.5% in the past week as it got board approval for a 1-for-1 issuance of bonus shares. Of the two depositories that operate in India, CDSL holds a leadership position with a market share of 77% as of June ‘24.

In Q1FY25, the company reported revenue growth of 65% YoY to Rs 287 crore, exceeding Forecaster estimates by 3.5%. Net profit during the quarter went up by 82.4% YoY to Rs 134 crore, surpassing estimates by 2.3%. During the quarter, the company’s new account openings doubled YoY to 99 lakh, taking the total count above 12.5 crore.

More than half of the revenue for CDSL comes from annual issuer income and transaction charges, which rose 21% and 108% on a YoY basis. Revenue from online data charges also doubled to Rs 53 crore. Meanwhile, revenue from IPO/corporate action charges almost tripled to Rs 27 crore, driven by a surge in new listings over the past year.

MD and CEO, Nehal Vora, said, “India’s capital markets have experienced growth, benefiting from shifting investor preferences toward capital market investments.” He highlights the rapid growth in the number of new demat account openings as rising interest in the Indian equity market continues to attract new investors.

Despite the outperformance, ICICI Securities maintains a ‘Hold’ rating on CDSL, noting that the lower regulatory risk for the company in comparison to brokerages or exchanges is already priced in and is reflected in its current valuation. Analysts forecast revenue and PAT CAGR of 23% over FY25-26 driven by continued growth in capital markets.

3. DLF:

This realty company has risen by over 3.4% in the past week. It announced its Q1FY25 results on July 25th, where the company’s net profit increased by 22.5% YoY to Rs 645.6 crore, while its revenue rose by 13.7% YoY, mainly due to a decline in expenses related to constructed properties and development rights. 

The firm missed Trendlyne’s Forecaster estimates for revenue by 11.5% and for net profit by 7.1%, due to an 83% YoY decline in Q4FY24 pre-sales resulting from a lack of new launches in that quarter. The stock appears in a screener for stocks with high momentum scores.

The firm’s pre-sales in Q1 jumped to Rs 6,400 crore, compared to Rs 1,642 crore in Q4FY24. This surge in pre-sales was primarily driven by the successful launch of the second phase of its new project, Privana West in Gurugram. Ashok Tyagi, Whole Time Director of the firm, maintained his FY25 pre-sales guidance of Rs 16,000 crore and stated: “We are not officially re-guiding a higher number right now. But this guidance figure accounts for about 90%+ sale level on all other launches, and a small introductory sale level on Lux 5 (an ultra-luxury project of the company). Hopefully, that’s where more upside could come in.”

The firm’s rental income in its commercial portfolio increased by 10% YoY to Rs 1,150 crore, led by the completion of its Downtown Chennai asset and a 40 bps rise in occupancy, which resulted in a 10% YoY increase in office rental income.

Commenting on the rental business, Sriram Khattar, Vice Chairman and MD (Rental Business), said: “The increase in rental income is due to two factors: the annual accrual and the commencement of rentals for Downtown 1 and 2 in Chennai. While the exit guidance remains Rs 5,000 crore, the rental jump next year will be substantial with the inclusion of Downtown 4 in Gurgaon, Downtown 3 in Chennai, and full rentals for Downtown 1 and 2, resulting in a significant rise in FY26.”

Motilal Oswal has maintained a “Neutral” rating on DLF, with a target price of Rs 850. The brokerage estimates an 8-10% CAGR growth in prices across its key markets of Gurugram, New Gurugram, Delhi, and Chandigarh. Based on these assumptions, it values the firm’s land parcel at Rs 1,10,900 crore. The brokerage adds that the firm’s current valuation already implies Rs 1,06,000 crore of value for its land, indicating limited upside potential. 

4. Genus Power Infrastructures:

This electric meter manufacturer surged 13.9% over the past week as it secured multiple orders worth Rs 6,534 crore from state electricity boards (SEBs) and private utilities. The orders include the design, supply, and installation of 80 lakh smart meters, as well as the design of advanced metering infrastructure (AMI) systems.

Genus Power has outperformed the consumer durables sector by 14.8% over the previous quarter. Its net profit rose 109.7% YoY to Rs 48.3 crore in Q1FY25, helped by inventory destocking. The firm’s EBITDA grew 2.3 times YoY to Rs 63.2 crores as margins expanded by 440 bps, helped by lower expenses. Revenue grew 57.5% YoY to Rs 441.2 crore during the quarter, but saw a marginal decline compared to the previous quarter due to seasonal fluctuations and delays caused by the Lok Sabha election.

Genus Power holds an order book of Rs 28,000 crore, with Rs 25,000 crore attributed to the AMI segment through Special Purpose Vehicle (SPV). This also includes contracts from various export customers and supply orders. Jitendra Agarwal, Joint Managing Director, said, "Of the Rs 25,000 crore AMI order book, around 70-75% flows back to Genus, while the rest is allocated to project financing and O&M activities. This order book is expected to be completed by mid-FY28, with a significant portion set to be executed within the next 24 months.”

The company plans an equity infusion of Rs 1,700 crore into the platform over the next three to four years, with 20-25% of this amount expected in this year. Agarwal clarified that this infusion will not be purely from debt, as the company currently holds a cash reserve of approximately Rs 500-600 crore.

ICICI Securities maintains its “Buy” rating with an upgraded target price of Rs 445. The brokerage anticipates improved raw material supply and a ramp-up in order execution, projecting a PAT CAGR of 125% over FY25-26.

5. Techno Electric & Engineering Company: 

This electric utilities company primarily generates wind power through wind turbine generators, and also specializes in engineering, procurement, and construction (EPC) services. Its stock was a multibagger, surging 252.3% over the past year and rising 7.9% in the past week. 

The company had delivered strong quarter results, as its net profit grew 288% YoY to Rs 98.1 crore in Q1FY25. Revenue rose 37% YoY to Rs 375.4 crore, driven by a 27.4% rise in the EPC/Engineering services segment. The company appears in a screener of stocks with quarterly growth in net profit with increasing profit margin. Ankit Saraiya, Whole-Time Director, noted that quarterly results vary due to the business cycle: Q1 usually contributes 15% of annual turnover, Q2 20%, Q3 30%, and Q4 35%.

On August 19, the company hit a 5% upper circuit as it entered a partnership with Indigrid to set up two greenfield interstate transmission system (ISTS) projects. Under the partnership, Techno Electric co-developed and invested a minority stake in Indigrid's Ishanagar Power Transmission and Dhule Power Transmission. Saraiya also stated, “We are actively pursuing bids of over Rs 5,000 crore and are expecting to secure orders at least worth Rs 3,000 crore.”

The company’s current unexecuted order book stands at approximately Rs 9,100 crore (a 146% YoY change), with a diverse portfolio that includes Rs 1,260 crore in generation, Rs 4,889 crore in transmission, Rs 2,776 crore in distribution, and Rs 175 crore in data center projects.The company serves both government and private sector clients with a focus on power, infrastructure, and industrial projects. It has also secured L1 status in additional orders worth Rs 1,200 crore, including two Power Grid Corp of India (PGCIL) projects in Nilgarh and Zerovi valued at Rs 478 crore, an Assam Gas Company (AGCL) order worth Rs 522 crore, and an Adani order of Rs 135 crore.

Despite strong results and a robust order book, Emkay has initiated a 'Sell' rating with a target price of Rs 1,600. The brokerage anticipates that the company will benefit from a significant increase in the order book and favorable tailwinds. However, they downgraded the stock from 'Buy' to 'Sell' due to its current valuation and the recent sharp rise in the stock price. They expect revenue and EBITDA to grow at a CAGR of 21% and 25%, respectively, over FY 25-27.

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

 
Trendlyne Marketwatch
Trendlyne Marketwatch
23 Aug 2024
Market closes flat, Sun Pharma rises to an all-time high following the launch of STARIZO
By Trendlyne Analysis

Nifty 50 closed at 24,823.15 (11.7, 0.1%) , BSE Sensex closed at 81,086.21 (33.0, 0.0%) while the broader Nifty 500 closed at 23,418.65 (-22.1, -0.1%). Market breadth is even. Of the 2,248 stocks traded today, 1,067 were in the positive territory and 1,155 were negative.

Indian indices closed flat, with the benchmark Nifty 50 index closing at 24,823.2 points. The Indian volatility index, Nifty VIX, rose by 4.3% and closed at 13.6 points. Adani Group-owned Holderind Investments plans to sell a 2.8% stake (or 7 crore shares) in Ambuja Cements worth $500 million (approx. Rs 4,194.4 crore).

Nifty Midcap 100 closed in the red, while Nifty Smallcap 100 closed flat. Nifty Auto & S&P BSE Midsmallcap were among the top index gainers today. According to Trendlyne’s Sector dashboard, Healthcare Equipment & Supplies emerged as the best-performing sector of the day, with a jump of over 2.4%.

Asian indices closed flat or lower while European indices are trading higher. US index futures traded higher, indicating a positive start to the trading session. Brent crude oil futures are trading in the green. Citi Research identifies a potential short-term buying opportunity, despite a reduction in geopolitical tensions. The brokerage highlights that several factors could drive a rebound, with oil prices possibly reaching $80 per barrel.

  • Money flow index (MFI) indicates that stocks like PCBL, Vijaya Diagnostic Centre, Trent, and Glenmark Lifesciences are in the overbought zone.

  • Sun Pharmaceuticals rises to an all-time high of Rs 1,781 following the launch of STARIZO, an antibacterial treatment for drug-resistant infections. The new drug specifically targets acute bacterial skin and skin structure infections (ABSSSI), particularly those caused by drug-resistant bacteria.

  • SEPC rises sharply to a new 52-week high of Rs 26.7 as it receives the final acceptance certificate from The Hutti Gold Mines for a Rs 232 crore contract. The contract involves constructing a new circular shaft with complete winding installations in Hutti, Karnataka.

  • InterGlobe Aviation (IndiGo) rises sharply after Jefferies upgrades its rating to 'Buy' with a target price of Rs 5,225 per share, implying a 10.8% upside. The brokerage is positive about IndiGo’s growth due to its expanding market share and strong revenue per passenger.

  • The Indian Government plans to amend the Foreign Exchange Management Act (FEMA) regulations to ease the transition of foreign portfolio investor (FPI) inflows into foreign direct investments (FDI). This change will simplify the process when an FPI surpasses the 10% ownership threshold in a company.

  • Jindal Saw rises sharply as its board approves a stock split, dividing existing equity shares with a face value of Rs 2 each into shares with a face value of Re 1 each.

  • Shriram Finance's board of directors approves the sale of its subsidiary, Shriram Housing Finance, to Mango Crest Investment, pending approval from the Competition Commission of India (CCI).

  • Foreign institutional investors buy equity worth Rs 3,044.4 crore in the market over the past week, according to Trendlyne's FII dashboard. Whereas, index options witness the highest inflow of Rs 12,706.5 crore from foreign investors. Meanwhile, mutual funds are net buyers in the equity market, investing Rs 7,059.3 crore during the same period.

  • Reports suggest that 1.2 crore shares (2.9% equity) of Tata Technologies, amounting to Rs 1,218.5 crore, change hands in a large trade.

  • JK Cement reportedly plans to invest Rs 4,900 crore to set up new 6 million ton grinding units and 8 million ton clinker units in Jaisalmer.

  • Shakti Pumps (India) rises as it secures an order worth Rs 9.4 crore from the Department of Agriculture, Jharkhand, for 400 solar water pumping systems (SWPS). The order includes the design, manufacture, supply, transport, installation, testing, and commissioning of the systems.

  • Emkay maintains its 'Reduce' rating on One97 Communications (Paytm) but raises the target price to Rs 375 per share. This indicates a potential upside of 32.8%. The brokerage believes the company's deal with Zomato to sell its ticketing business will improve Paytm’s cash equivalents which will be used to scale up rewards/cash-back program to revive its payment business following the RBI action. It expects the company's revenue to grow at a CAGR of 3.5% over FY25-27.

  • The global copper market is experiencing significant disruptions as China, usually a major importer, has started exporting large quantities due to low domestic demand. This shift has caused a substantial gap in global prices, leading the US to import approximately 91,000 tons in July alone, the third-largest monthly amount in the past decade.

  • CDSL rises sharply to a new all-time high of Rs 1,595 as the stock trades ex-date for its bonus issue. Shareholders will receive one new fully paid-up equity share with a face value of Rs 10 each for every existing equity share.

  • Reliance Home Finance (RHFL) shares fall as SEBI bars Anil Ambani and 24 others, including key RHFL officials, from participating in the securities market for five years due to fund diversion from the company. Ambani is also prohibited from holding positions like director or key manager in any listed company.

  • Power Mech Projects' surges to its all-time high of Rs 7,167 as its board of directors approves a bonus issue of shares to equity holders in the ratio of 1:1. The record date for the issue is September 28.

  • Brij Bhushan Agarwal, MD & VC of Shyam Metalics & Energy, highlights that the firm's current value-added products stand at 70% of the mix and will support their margins. He guides an EBITDA per tonne in the range of Rs 6,000-6,500 and expects a return on capital employed (ROCE) of 28% in the coming years.

  • Bharat Forge invests an additional Rs 105.5 crore in Kalyani Powertrain by subscribing to 10.5 crore shares in the company.

  • JSW Energy's wholly-owned subsidiary, JSW Neo Energy, receives a letter of award from NTPC for setting up a 300 MW wind-solar hybrid power project.

  • Jain Irrigation Systems rises sharply as it signs a memorandum of understanding (MoU) with the Coffee Board of India for the commercial supply of advanced high-quality, disease-resistant coffee plants to growers.

  • Global funds have been consistently investing in India’s debt market for 14 consecutive weeks, marking the second significant buying streak this year. This trend highlights India’s appeal amid the turbulence in global financial markets. With potential rate cuts on the horizon and the rupee trading near historic lows, offshore investors have net purchased around $7 billion worth of Indian bonds since May.

  • Promoters of FSN E-Commerce Ventures (Nykaa) reportedly plan to sell up to 4.1 crore shares (a 1.4% stake) for Rs 810 crore in a block deal at an average price of Rs 198 per share.

  • Adani Group-owned Holderind Investments plans to sell a 2.8% stake (or 7 crore shares) in Ambuja Cements worth $500 million (approx. Rs 4,194.4 crore).

  • RailTel Corp of India rises sharply as it secures a work order worth Rs 52.7 crore from Uttar Pradesh Police Recruitment and Promotion Board for CCTV surveillance, Aadhaar-based biometric services, and digital fingerprint and facial recognition during exams.

  • Adani Power is rising as it receives approval from the National Company Law Tribunal (NCLT) to acquire Lanco Amarkantak Power with an upfront payment of Rs 4,101 crore.

  • Nifty 50 was trading at 24804.95 (-6.6, 0.0%) , BSE Sensex was trading at 81165.65 (112.5, 0.1%) while the broader Nifty 500 was trading at 23448.95 (8.3, 0.0%)

  • Market breadth is in the green. Of the 1977 stocks traded today, 1160 were gainers and 778 were losers.

Riding High:

Largecap and midcap gainers today include FSN E-Commerce Ventures Ltd. (226.77, 7.8%), InterGlobe Aviation Ltd. (4,710.45, 5.1%) and Bajaj Auto Ltd. (10,406.45, 5.0%).

Downers:

Largecap and midcap losers today include Macrotech Developers Ltd. (1,161.25, -5.0%), Deepak Nitrite Ltd. (2,821.05, -4.4%) and Avenue Supermarts Ltd. (4,901.50, -3.1%).

Movers and Shakers

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

Top high volume gainers on BSE included Minda Corporation Ltd. (631.15, 17.3%), Himadri Speciality Chemical Ltd. (527.15, 9.0%) and FSN E-Commerce Ventures Ltd. (226.77, 7.8%).

Top high volume losers on BSE were Prince Pipes & Fittings Ltd. (582, -4.4%), Anand Rathi Wealth Ltd. (3,605.35, -4.1%) and The Ramco Cements Ltd. (819.90, -1.5%).

Vardhman Textiles Ltd. (500.25, 3.4%) was trading at 19.6 times of weekly average. Ambuja Cements Ltd. (633.60, 0.3%) and Tata Technologies Ltd. (1,036.95, 3.0%) were trading with volumes 7.5 and 6.4 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,

Stocks touching their year highs included - Apollo Hospitals Enterprise Ltd. (6,860.70, 0.4%), Ashok Leyland Ltd. (260.40, -0.5%) and Aurobindo Pharma Ltd. (1,538.20, 0.3%).

10 stocks climbed above their 200 day SMA including Prism Johnson Ltd. (167.74, 3.9%) and Eureka Forbes Ltd. (527.85, 3.9%). 8 stocks slipped below their 200 SMA including Macrotech Developers Ltd. (1,161.25, -5.0%) and Sammaan Capital Ltd. (170.50, -3.5%).

 
Trendlyne Marketwatch
Trendlyne Marketwatch
22 Aug 2024
Market closes higher, Gail signs a MoU to form a 50:50 JV with Petron Scientech
By Trendlyne Analysis

Nifty 50 closed at 24,811.50 (41.3, 0.2%) , BSE Sensex closed at 81,053.19 (147.9, 0.2%) while the broader Nifty 500 closed at 23,440.70 (72.1, 0.3%). Market breadth is in the green. Of the 2,249 stocks traded today, 1,380 were gainers and 851 were losers.

Indian indices closed higher after switching between losses and gains throughout the day. The Indian volatility index, Nifty VIX, fell 2.5% and closed at 13 points. GAIL (India) signs a memorandum of understanding (MoU) to form a 50:50 joint venture (JV) with Petron Scientech to establish a 500 kilo-tonnes per annum (KTA) bio-ethylene plant.

Nifty Smallcap 100 and Nifty Midcap 100 closed in the green. S&P BSE Telecom and S&P BSE SME IPO were among the top index gainers today. According to Trendlyne’s Sector dashboard, Fertilizers emerged as the best-performing sector of the day, with a rise of 3.1%.

Asian indices closed in the green except IDX Composite and CSE All-Share. European indices are trading in the green. US index futures are trading in the green except for Small Cap 2000, indicating a positive start to the trading session. Brent crude oil futures are trading higher.

  • Deepak Nitrite sees a long buildup in its August 29 futures series, with open interest increasing by 24.5% and a put-call ratio of 0.3.

  • Promoters of Alkem Laboratories sell nearly 8.5 lakh shares (a 0.7% stake) for Rs 487 crore in a block deal on Thursday, at an average price of Rs 5,732 per share.

  • Transformers & Rectifiers (India) surges to its 5% upper circuit as it secures two international orders worth $16.8 million (approximately Rs 134.3 crore). The orders include the supply of 18 trackside traction transformers of 20 MVA, 55 trackside autotransformers of 7.5 MVA, and a 66 KV electrical arc furnace transformer.

  • Nucleus Software Exports' board approves a Rs 72.4 crore buyback of up to 4.5 lakh equity shares at Rs 1,615 per share. It sets September 3 as the record date for the buyback.

  • Vivek Kumar Dewangan, MD & Chairman of REC, projects assets under management (AUM) in the range of Rs 5.9-6 lakh crore, with disbursements of Rs 1.9 lakh crore and net interest margins (NIMs) of 3.6% for FY25. He expects to maintain the current market share of 20% and foresees strong growth potential in the smart meters sector.

  • Wonder Electricals rises sharply as its board approves the sub-division (stock split) of its existing equity shares from one equity share with a face value of Rs 10 into ten equity shares with a face value of Re 1.

  • Shyam Metalics and Energy surges to a new all-time high of Rs 844.5 per share as it announces phase I of its clean energy project with an installed capacity of 5.2 megawatt-peak (MWp). Phase II of the project will have a capacity of 4.8 MWp, with phase III having the highest capacity of 10.4 MWp. The company will set up floating and rooftop solar panels at its manufacturing plants in West Bengal, Odisha and Madhya Pradesh.

  • GAIL (India) signs a memorandum of understanding (MoU) to form a 50:50 joint venture (JV) with Petron Scientech to establish a 500 kilo-tonnes per annum (KTA) bio-ethylene plant and downstream units in India.

  • Executive Director at IMF, Krishnamurthy Subramanian stresses the importance of boosting innovation and productivity in India’s private sector to reach a $55 trillion economy by 2047. He points out that the increased R&D investment, improved credit access for SMEs, and state-level reforms are crucial, while also recognizing the challenges posed by climate change and geopolitical issues.

  • Dabur India rises as it signs an MoU with the Government of Tamil Nadu for its first Southern plant. The company will invest Rs 135 crore initially, with plans for capex of up to Rs 400 crore in five years. The facility in Tindivanam will manufacture various products, including Red Toothpaste, Odonil and Honey.

  • Escorts Kubota rises as National Company Law Tribunal (NCLT) approves its merger with Kubota Agriculture Machinery.

  • Transport Corp. of India surges to a new all-time high of Rs 1,238 per share as the company is set to consider a share buyback proposal in its board meeting scheduled for Saturday.

  • ICICI Prudential Mutual Fund cuts stake in TVS Motor Company by 2%, taking the fund's stake in the company to 7.2%.

  • KR Choksey upgrades Zydus Lifesciences to a 'Buy' rating from 'Accumulate', sets a higher target price of Rs 1,439. This indicates a potential upside of 19.2%. The brokerage believes that the company's revenue will continue to grow, driven by improvements in the specialty business in the Indian and international markets and strong growth in the Indian biosimilar segment. It expects the company's revenue to grow at a CAGR of 12.1% over FY25-26.

  • Zen Technologies rises sharply to a new all-time high of Rs 1,863.4 as it launches a qualified institutional placement (QIP) to raise Rs 1,000 crore. The board sets a floor price of Rs 1,685.2 per share for the QIP.

  • Welspun Enterprises rises as it receives a letter of acceptance (LOA) from Brihanmumbai Municipal Corporation (BMC) to rehabilitate man-entry sewers using trenchless technology in Mumbai's suburbs. The total order value is Rs 159.7 crore, and the project is expected to complete within 24 months.

  • A flash survey by HSBC Holdings reveals that India's economic activity eased slightly in August due to a slowdown in new order growth within the manufacturing sector. Pranjul Bhandari, HSBC's Chief India Economist, notes that while new order growth for manufacturing has slowed to its weakest level since February, the expansion rate remains robust, indicating strong demand and favorable market conditions.

  • PNB Housing Finance falls sharply after 81 lakh shares (3.2% stake), amounting to Rs 715.6 crore, reportedly change hands in a block deal. Asia Opportunities V (Mauritius) is the likely seller in the transaction.

  • Bajaj Auto reportedly receives production-linked incentive (PLI) approval for 13 of its two and three-wheelers. This comes after the company met the mandatory requirement of 50% minimum domestic value addition (DVA).

  • KKR affiliate Esoteric II Pte. is set to sell up to 7.5 crore shares (17.3% stake) in India Grid Trust through an offer for sale at a floor price of Rs 132 per share. The offer opens on August 22 and closes on August 23.

  • One 97 Communications (Paytm) plans to reduce board members' compensation, setting an annual cap of Rs 48 lakh with a fixed component of Rs 20 lakh. This proposal comes ahead of their annual general meeting on September 12 and will require shareholder approval.

  • Indian Renewable Energy Development Agency rises sharply as it plans to raise funds worth Rs 4,500 crore through a follow-on public offer (FPO), qualified institutional placement (QIP), rights issue, or preferential issue. The board of directors of the company will consider the fundraising proposal at its meeting scheduled for August 29.

  • Kalyan Jewellers surges as Highdell sells a 2.4% stake (or 2.4 crore shares) in the company to its promoter, Trikkur Sitarama Iyer Kalyanaraman, for Rs 1,300 crore at a rate of Rs 535 per share.

  • Rail Vikas Nigam rises as it signs a memorandum of understanding (MoU) with Dhaya Maju Infrastructure (Asia) Sdn Berhad (DMIA) to participate in railway infrastructure and services projects in the Association of Southeast Asian Nations (ASEAN) market.

  • Zomato rises as it enters an agreement with One97 Communications (Paytm) to acquire its movie, sports, and events ticketing businesses for Rs 2,048 crore. As per the agreement, Paytm will transfer the ticketing business to its subsidiaries, Wasteland Entertainment and Orbgen Technologies which will then be acquired by Zomato for Rs 783.8 crore and Rs 1,264.6 crore, respectively.

  • Nifty 50 was trading at 24,829.60 (59.4, 0.2%), BSE Sensex was trading at 81,207.24 (301.9, 0.4%) while the broader Nifty 500 was trading at 23,446.20 (77.6, 0.3%).

  • Market breadth is ticking up strongly. Of the 1,956 stocks traded today, 1,618 showed gains, and 319 showed losses.

Riding High:

Largecap and midcap gainers today include APL Apollo Tubes Ltd. (1,417.15, 4.3%), InterGlobe Aviation Ltd. (4,483.15, 4.3%) and Indian Hotels Company Ltd. (644.60, 3.8%).

Downers:

Largecap and midcap losers today include GlaxoSmithKline Pharmaceuticals Ltd. (2,914.85, -4.8%), One97 Communications Ltd. (553.70, -3.5%) and Adani Wilmar Ltd. (380.50, -3.3%).

Movers and Shakers

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

Top high volume gainers on BSE included Varroc Engineering Ltd. (604.90, 12.9%), Eureka Forbes Ltd. (507, 10.1%) and Kalyan Jewellers India Ltd. (596.40, 9.5%).

Top high volume losers on BSE were Chambal Fertilisers & Chemicals Ltd. (522.10, -0.3%), Sumitomo Chemical India Ltd. (542.25, -0.3%) and Deepak Nitrite Ltd. (2,951.10, -0.1%).

Elgi Equipments Ltd. (647.45, 2.2%) was trading at 14.8 times of weekly average. Medplus Health Services Ltd. (635, 0.1%) and Jubilant Ingrevia Ltd. (692, 8.2%) were trading with volumes 10.2 and 9.7 times weekly average respectively on BSE at the time of posting this article.

BSE 500: highs, lows and moving averages

40 stocks made 52 week highs,

Stocks touching their year highs included - Abbott India Ltd. (29,156.60, 2.2%), Ashok Leyland Ltd. (261.75, 0.6%) and Atul Ltd. (7,902.85, -1%).

22 stocks climbed above their 200 day SMA including Varroc Engineering Ltd. (604.90, 12.9%) and Eureka Forbes Ltd. (507, 10.1%). 1 stock slipped below their 200 SMA including Jai Balaji Industries Ltd. (932, 1.3%).

 
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The Baseline
22 Aug 2024
Chart of the Week: Indian rupee holds steady despite big shifts in monetary policies across the globe
By Satyam Kumar

On August 5, 2024, the Indian rupee reached its all-time low of Rs 84.1, driven by escalating geopolitical tensions in the Middle East and recession fears in the United States. Though the Indian rupee has hit its all-time low multiple times in the past year, the fall has been marginal, thanks to intervention by the Reserve Bank of India, limiting the losses. 

High volatility can complicate trading and investing in the rupee, potentially increasing costs for businesses and investors. However, interventions by the central bank and optimism surrounding potential rate cuts by the US Federal Reserve (Fed) kept the rupee around the critical threshold of Rs 84. The chart above shows that over the past year, the Indian rupee has depreciated by only 0.8% against the US dollar, reflecting its relative stability compared to other currencies like the Brazilian real and the Russian ruble. The Euro and Australian dollar have risen over the past year driven by growing expectations that the Fed might soon begin cutting interest rates.

RBI Governor, Shaktikanta Das, said, “It is always the priority of the RBI to ensure stability of Indian rupee.” This stability the governor talks of has been hard-won – a decade ago, the Indian rupee was one of Asia’s most volatile currencies. US-based Global Finance magazine has ranked Das as the top central banker globally for the second consecutive year, a ranking based on his success in managing inflation, promoting economic growth, and ensuring the currency’s stability while overseeing interest rate policies. 

The governor’s job is a tightrope, in ensuring the economy’s stability while facing pressures from corporates and consumers around interest rates. And not everyone is pleased. The International Monetary Fund (IMF) says that excessive forex intervention has contributed to the rupee-dollar moving within a narrow range since December 2022 and reclassified India’s exchange rate regime to ‘stabilized arrangement’ from ‘floating’

This week’s Chart of the Week examines the rupee’s performance among global currencies over the past year and the factors contributing to its improving stability over the past decade. 

How does the Yen carry trade impact the Indian rupee?

The yen carry trade, a popular strategy for over a decade, has been undergoing significant unwinding recently, affecting global markets, including India. This trade involves borrowing Japanese yen at the country’s very low interest rates (around 0.1%) and investing in higher-yielding assets abroad. However, the strategy has become less profitable due to recent changes in Japan’s monetary policy.

On the 31st of July, the Bank of Japan (BoJ) increased interest rates by 25 basis points (bps) to 0.25% from near-zero levels, and hinted at further hikes this year. Analysts also expect the US Federal Reserve to cut interest rates by 75 basis points in 2024, squeezing the differential between US-Japan interest rates and impacting profit margins further for those engaged in yen carry trades.

The BoJ's rate hike has led to a sharp 8% appreciation of the yen over the past month. As the yen strengthens, it becomes more expensive for investors to maintain yen-funded positions, prompting a rapid unwinding of these trades. This shift has had a noticeable impact on India’s financial markets. Following the BoJ’s rate hike, India's benchmark index, Nifty50, experienced a significant sell-off, dropping over 1,000 points from its peak of 25,000 within just three trading days. This decline is partly attributed to the fact that 23% of total inflows into India since January 2023, amounting to $10.3 billion, were invested by participants in yen carry trades.

US rate cuts: Potential boon for the Indian rupee

The anticipated rate cuts by the US Federal Reserve, expected to be around 75 bps in 2024, could, however, prove advantageous for the Indian rupee. Lower interest rates in the US often lead to increased foreign investment in emerging markets like India. As the interest rate differential between India and the US widens, India may become a more attractive investment destination compared to the US. 

The expected inflow of foreign capital could further boost Indian markets. Foreign institutional investors, who had withdrawn from Indian markets as the US Fed started to hike interest rates, could return as the interest rate environment shifts.

The lower US interest rates would also increase the availability of dollars, potentially leading to a softer dollar and a stronger rupee. A stronger rupee could benefit India by reducing its import bill, particularly for oil, which constitutes more than 80% of its total imports. A stronger rupee would help lower import costs, alleviate the current account deficit, and improve the fiscal deficit. A fiscal deficit represents the gap between how much the government earns and how much it spends. It would also make it cheaper for India to service its foreign debt.

Strong economic growth coupled with RBI’s intervention has led to a stable rupee

Volatility in the Indian rupee has fallen to a decade-low

Even though the Indian rupee has consistently weakened against the dollar over the past decade, the volatility has significantly decreased over time. This relative stability can be attributed to robust economic growth, consistent policy measures, and political stability coupled with RBI intervention whenever needed. Continuity in the Central government after the recent elections in June has boosted the confidence of foreign investors. Key reforms, such as assigning an inflation-target mandate to the central bank and reducing the budget deficit, have further supported this stability. India now boasts the world’s fourth-largest pile of foreign reserves.

By buying dollars when the rupee strengthens and selling foreign exchange when it weakens, the RBI has moderated significant currency fluctuations. This intervention helps smooth out the value of the rupee by managing the supply of dollars in the market.

However, the RBI's approach has its limitations. The central bank's interventions can sometimes mask changes in economic fundamentals, meaning that strong growth, which usually supports currency strength, might not always translate into a stronger rupee if the RBI continues to buy dollars.

 
Trendlyne Marketwatch
Trendlyne Marketwatch
21 Aug 2024
Market closes higher, Genus Power secures three orders worth Rs 3,608.5 crore
By Trendlyne Analysis

Nifty 50 closed at 24,770.20 (71.4, 0.3%) , BSE Sensex closed at 80,905.30 (102.4, 0.1%) while the broader Nifty 500 closed at 23,368.65 (88.3, 0.4%). Market breadth is in the green. Of the 2,256 stocks traded today, 1,470 showed gains, and 769 showed losses.

Indian indices extended their gains in the afternoon session to close higher. The Indian volatility index, Nifty VIX, fell 3.6% and closed at 13.3 points. Genus Power Infrastructures surged to its all-time high of Rs 437.8 per share as it bagged three orders worth Rs 3,608.5 crore to supply 4.3 million smart prepaid meters.

Nifty Smallcap 100 and Nifty Midcap 100 closed in the green. Nifty consumer Durables and Nifty FMCG were among the top index gainers today. According to Trendlyne’s Sector dashboard, Hardware Technology & Equipment emerged as the best-performing sector of the day, with a rise of 4.5%.

Most Asian indices closed mixed, while most European indices are trading higher, except Russia’s RTSI which is trading 0.5% lower. US index futures are also trading in the green, indicating a positive start to the trading session. Walmart plans to sell its stake in Chinese e-commerce firm JD.com for $3.7 billion.

  • Relative strength index (RSI) indicates that stocks like Balrampur Chini Mills, Glenmark Pharmaceuticals, Godfrey Phillips India, and PCBL are in the overbought zone.

  • CLSA downgrades Tech Mahindra to 'Hold' from 'Outperform' with a target price of Rs 1,670. The brokerage is cautious due to stretched valuations, weak telecom capex outlook, and delayed enterprise 5G commercialization.

  • Embassy Office Parks REIT rises as it signs an agreement to lease (ATL) with the Commonwealth Bank of Australia (CBA) for a premium office campus of approximately 0.8 million square feet (msf) at Embassy Manyata, with an option to expand by an additional 0.6 msf.

  • FMCG stocks like Varun Beverages, United Breweries, Dabur India, and ITC are rising in trade, helping the broader Nifty FMCG index to touch its all-time high of 63,196.2.

  • Fino Payments Bank's Managing Director and CEO, Rishi Gupta, says, "We believe our guidance of 25% growth will hold strong for fiscal 2025. Around one crore customers are engaged in our transaction business, significantly boosting our CASA (Current Account Savings Account) growth." He also highlights the expansion in cash management services, with 18 lakh merchants contributing approximately Rs 20,000 crore in Q1.

  • Indoco Remedies rises sharply as it receives USFDA approval for Lofexidine Tablets, which helps manage acute opioid withdrawal symptoms. The drug is a generic equivalent of Lucemyra from US WorldMeds.

  • Kilburn Engineering surges to its all-time high of Rs 474.4 per share as its board of directors approves the acquisition of Monga Strayfield for a consideration of Rs 123 crore.

  • Bharat Earth Movers surges as it signs a memorandum of understanding (MoU) with the Indian Navy's Marine Engineering division. This agreement focuses on the indigenous design, development, manufacture, testing, and support of critical marine equipment and systems.

  • ICICI Securities receives approval from the National Company Law Tribunal (NCLT) to delist from the exchanges. The NCLT also dismisses two applications objecting the delisting. 

  • Tata Motors signs a memorandum of understanding (MoU) with Delta Electronics and Thunderplus Solutions to install 250 fast-charging stations in over 50 cities across India. This will expand the network of commercial EV charging points to 790 from the existing 540.

  • Dhanuka Agritech rises sharply as its board approves a Rs 100 crore buyback of up to 5 lakh equity shares at Rs 2,000 per share. The buyback offer will open on August 22 and close on August 28.

  • Bank of America reportedly maintains 'Buy' on Varun Beverages with a target price of Rs 1,840 per share. This indicates a potential upside of 18.7%. The brokerage is positive about comapny's expansion in new markets like South Africa and Congo, along with growth potential from new products such as dairy beverages and energy/sports drinks.

  • NLC India’s Managing Director and Chairperson, Prasanna Motupalli, says that the company plans to invest Rs 1.3 lakh crore in capital expenditures by 2030. He also highlights plans to expand the company's thermal capacity to 12 gigawatts (GW) from 4 GW and its mining capacity to 100 million tonnes (MT) from 50 MT. 

  • Servotech Power Systems surges as it secures a contract from the Department of Power, Kerala, to supply, commission, and construct 12 EV charging stations with 30kW Fast DC chargers at various Kerala Motor Vehicle Department locations.

  • Larsen & Toubro rises as it wins an order for the Integrated Infrastructure Development project in Navi Mumbai. The company classifies the project as large (Rs 2,500 crore to Rs 5,000 crore), involving road development, construction of structures, and electrical works under the Navi Mumbai airport influence notified area (NAINA) project.

  • Cyient rises as it approves the sale of a 14.5% stake (or 1.1 crore shares) in its subsidiary, Cyient DLM, through a bulk deal. The company expects to complete the transaction on Wednesday.

  • Marksans Pharma rises to its all-time high of Rs 224.9 per share as its subsidiary, Relonchem, gets approval from UK Medicines and Healthcare Products Regulatory Agency (UKMHRA) to market its Fluoxetine capsules. 

  • PNB Housing Finance rises sharply after 1.4 crore shares (5.1% stake), amounting to Rs 1,032.7 crore, reportedly change hands in a block deal. General Atlantic Singapore Fund is the likely seller in the transaction.

  • Emkay maintains its 'Buy' call on Kalpataru Projects with a higher target price of Rs 1,550 per share. This indicates a potential upside of 26.2%. The brokerage believes that the company will outperform its peers, led by a strong order book and robust execution. It expects the company's revenue to grow at a CAGR of 14.5% over FY25-27.

  • Promoters of HG Infra Engineering sell nearly 18 lakh shares (a 2.8% stake) for Rs 281 crore in a block deal on Tuesday, at an average price of Rs 1,566.5 per share.

  • Reports suggest that 88.8 lakh shares of Delhivery, amounting to Rs 389.6 crore, change hands in a block deal.  

  • PI Industries is rising as the UK Companies Court approves its acquisition of Plant Health Care Plc for 32.8 million pounds (approx. Rs 358.2 crore). This acquisition will help the company to provide integrated agri-solutions in chemicals and biologicals.

  • Petronet LNG surges to an all-time high of Rs 384.2 as it signs a five-year memorandum of understanding (MoU) with Sri Lanka's LTL Holdings for the supply of LNG to LTL’s dual-fuel power plants in Kerawalapitiya, Colombo.

  • Genus Power Infrastructures surges to its all-time high of Rs 437.8 per share as it bags three orders worth Rs 3,608.5 crore to appoint advanced metering infrastructure service providers (AMISPs). The company will also design advanced metering infrastructure (AMI) systems with the supply, installation, and commissioning of 4.3 million smart prepaid meters.

  • Sansera Engineering surges as its board of directors approves a fundraising worth Rs 1,200 crore through qualified institutional placements (QIPs) or other modes.

  • Nifty 50 was trading at 24,700.20 (1.4, 0.0%) , BSE Sensex was trading at 80,667.25 (-135.6, -0.2%) while the broader Nifty 500 was trading at 23,301.50 (21.2, 0.1%)

  • Market breadth is surging up. Of the 1966 stocks traded today, 1369 were on the uptrend, and 554 went down.

Riding High:

Largecap and midcap gainers today include Adani Wilmar Ltd. (393.55, 10.0%), FSN E-Commerce Ventures Ltd. (210.79, 9.4%) and GlaxoSmithKline Pharmaceuticals Ltd. (3,061.45, 5.9%).

Downers:

Largecap and midcap losers today include Torrent Power Ltd. (1,723.10, -4.1%), Mankind Pharma Ltd. (2,281.70, -3.2%) and Gujarat Fluorochemicals Ltd. (3,197, -2.6%).

Crowd Puller Stocks

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

Top high volume gainers on BSE included Alok Industries Ltd. (28.10, 10.7%), PNB Housing Finance Ltd. (892.85, 10.1%) and Adani Wilmar Ltd. (393.55, 10.0%).

Top high volume losers on BSE were ICICI Securities Ltd. (785.95, -7.3%), Nuvama Wealth Management Ltd. (6,256.05, -4.3%) and Ratnamani Metals & Tubes Ltd. (3,484.45, -0.2%).

Capri Global Capital Ltd. (211.87, 3.4%) was trading at 75.5 times of weekly average. Century Textiles & Industries Ltd. (2,306.30, 7.2%) and Castrol India Ltd. (268.50, 7.1%) were trading with volumes 27.9 and 10.4 times weekly average respectively on BSE at the time of posting this article.

BSE 500: highs, lows and moving averages

40 stocks took off, crossing 52 week highs,

Stocks touching their year highs included - Bombay Burmah Trading Corporation Ltd. (2,521.70, 0.4%), Colgate-Palmolive (India) Ltd. (3,574.50, 0.5%) and Coromandel International Ltd. (1,761.95, 0.7%).

18 stocks climbed above their 200 day SMA including Alok Industries Ltd. (28.10, 10.7%) and Narayana Hrudayalaya Ltd. (1,256.60, 6.5%). 2 stocks slipped below their 200 SMA including TV18 Broadcast Ltd. (49.54, 1.0%) and Aster DM Healthcare Ltd. (401.15, 2.0%).

 
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The Baseline
20 Aug 2024
Five stocks to buy from analysts this week - August 20 2024
By Divyansh Pokharna

1. PCBL:

ICICI Direct maintains its ‘Buy’ rating on this black carbon manufacturer with a target price of Rs 500, indicating a potential upside of 18.1%. Analysts Chirag Shah and Shashank Kanodia highlight the recent acquisition of Aquapharm Chemicals, which reported a Q1FY25 EBITDA of Rs 55 crore with 75% capacity utilization. Shah and Kanodia said, “Aquapharm’s performance is promising, with EBITDA expected to rise to Rs 80-90 crore by Q4FY25.”

PCBL reported net sales of Rs 2,144 crore in Q1FY25, with carbon black sales volumes reaching 154 KT, up 25% YoY. Net profit for the quarter was Rs 118 crore, supported by the highest-ever EBITDA of Rs 358 crore. The company’s near-term capacity expansion aims to increase carbon black production to 10 lakh tonnes, with further medium-term plans for an additional 4 lakh tonnes. 

Shah and Kanodia note that the company targets a five times increase in PAT, reaching Rs 2,500 crore by FY29. They also highlight strong export performance, with export volumes reaching 21% of total sales in Q1FY25 and expected to grow to 45% by FY27, supporting robust long-term growth.

2. Ipca Laboratories:

Sharekhan upgrades its rating on this pharma company to ‘Buy’ with a higher target price of Rs 1,600. This indicates a potential upside of 15.6%. The company's Q1FY25 sales grew 32.9% YoY to Rs 2,092 crore. The analyst attributes this growth to the integration of the Unichem business, and strong domestic and international sales. IPCA has surpassed the Indian Pharmaceutical Market (IPM) growth of 8-9% with a 11.6% increase in the domestic brand. The company appears in a screener of stocks that have outperformed their respective industry over the past month.

Unichem's integration is expected to add to profitability, with EBITDA set to reach Rs 225 crore by FY25 from Rs 100 crore in FY24. The company plans to launch 4-5 new products in the US market in FY25 and expand its international presence. Bayshore, now part of Unichem, will handle distribution of IPCA’s US products.

Analysts highlight the company’s promising growth prospects, driven by strong API demand and capacity expansion. It has set up a new 50MT API plant at Ratlam, nearing commercialization. Despite short-term cost pressures, new plants and increased formulation opportunities are expected to drive future growth.

3. EPL:

Motilal Oswal maintains its ‘Buy’ rating on this plastic packaging company with a target price of Rs 275, indicating an upside of 9.7%. In Q1FY25, the company’s net profit grew 18% YoY to Rs 64.2 crore, and revenue increased by 10.2% YoY to Rs 1,013 crore. According to analyst Sumant Kumar, improved operating performance in the US and Europe drove profits higher. The EBITDA margin grew by 610 bps to 15.8% in the US region.

Revenue growth was driven by broad-based regional performance, and a 6% YoY increase in the personal care segment, which now contributes 47% to total revenue. Kumar also highlights the company’s strong momentum in Brazil, where new customer acquisitions are driving the Brazil plant's utilization rate to 65-70%. He expects the firm to post revenue CAGR of 8% and adjusted net profit CAGR of 30% over FY25-26.

EPL is experiencing significant demand for sustainable products, with the share of sustainable tubes rising to 29% of total volume in Q1FY25, up from 21% in Q1FY24. The company aims to sustain double-digit growth with margins exceeding 20%.

4. Hindalco Industries:

Axis Direct has reaffirmed its ‘Buy’ rating for Hindalco Industries, a key player in aluminum and aluminum products, with a target price of Rs 715, indicating a potential upside of 6.3%. In Q1FY25 the company's net profit rose 25.3% YoY to Rs 3,074 crore, driven by higher EBITDA. Its operating revenue increased 7.6% YoY to Rs 57,013 crore, fueled by higher sales from its upstream and aluminium business, and copper business segments.

Analyst Aditya Welekar highlights that the downstream capex for its extrusion plant in Silvassa, Gujarat and flat rolled products (FRP) plant in Odisha is nearly complete and is expected to operate at full capacity from Q4FY25. For upstream projects, alumina expansion in Odisha will commence first, followed by the Copper smelter (280-300 kt) and a 180-pot Aluminium smelter (180 ktpa) expansion in Aditya with RE-RTC power. Each of these projects will have a capex of Rs 8,000 crore.The company is also in the process of securing Stage I & II forest clearances. It owns several key assets, including the Chakla coal mine (5.5 mtpa), Meenakshi West (5 mtpa), and Meenakshi mine (12 mtpa).  Welekar anticipates that the company's expansion projects will result in EBITDA and revenue growth of 6% and 7.7 % respectively for FY25-26, with PAT and EPS growth of 11% over the same period

5. Fineotex Chemical:

KRChoksey retains its ‘Buy’ rating on this small cap Fineotex Chemical with a target price of Rs 529, indicating a potential upside of 44.5%. This specialty chemicals company reported a net profit of Rs 28.8 crore in Q1FY25, a 12% rise YoY. Revenue grew 7.3% YoY to Rs 146.8 crore, although it declined by 7% quarter-on-quarter (QoQ) due to lower realizations, while volume growth was maintained, according to analyst Unnati Jadhav.

Jadhav highlights that during the quarter, the company allotted 9.7 lakh fully paid-up equity shares and issued 26.3 lakh share warrants, each convertible into one equity share, were issued at Rs 346 per share. The company raised a total of Rs 56.2 crore this quarter. An additional round of 28.2 lakh equity shares and warrants, both priced at Rs 387.4 per share, has also been announced, totaling Rs 192.5 crore.

Jadhav notes multiple triggers coming into play for next year such as increasing cotton demand, inorganic international opportunities and the expansion of cleaning and hygiene segment. She expects EPS estimates for FY 25-26 to be Rs 13.7 and Rs 17.5, respectively, with a revenue CAGR of 23% and a PAT CAGR of 32% over the same period.

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

(You can find all analyst picks here)

 
Trendlyne Marketwatch
Trendlyne Marketwatch
20 Aug 2024
Market closes higher, Granules India receives USFDA approval for Glycopyrrolate
By Trendlyne Analysis

Nifty 50 closed at 24,698.85 (126.2, 0.5%) , BSE Sensex closed at 80,802.86 (378.2, 0.5%) while the broader Nifty 500 closed at 23,280.35 (140.6, 0.6%). Market breadth is in the green. Of the 2,247 stocks traded today, 1,376 were in the positive territory and 843 were negative.

Indian indices maintained their gains from the morning session to close higher. The Indian volatility index, Nifty VIX, fell 3.5% and closed at 13.8 points. Zomato fell before closing marginally higher as Antfin Singapore reportedly sold 20.7 lakh shares (2.2% stake) worth Rs 4,661.4 crore in a block deal.

Nifty Smallcap 100 and Nifty Midcap 100 closed in the green. Nifty PSU Bank and S&P BSE Utiliti were among the top index gainers today. According to Trendlyne’s Sector dashboard, Telecommunications Equipment emerged as the best-performing sector of the day, with a rise of 2.2%.

Most Asian indices closed higher, except Hong Kong’s Hang Seng and China’s FTSE China 50, both of which closed 0.3% lower. European indices are trading mixed. US index futures are also trading mixed, indicating a cautious start to the trading session. Media executive Edgar Bronfman Jr submits a $4.3 billion bid to acquire Paramount Global’s parent company, National Amusements.

  • Money flow index (MFI) indicates that stocks like Jubilant Pharma, PCBL, Trent, and Caplin Point Laboratories are in the overbought zone.

  • Hazoor Multi Projects rises sharply as it emerges as the lowest bidder for a Rs 273.7 crore project from the Maharashtra State Infrastructure Development Corporation (MSIDC). The project involves widening and improving a key road in Nandurbar under the engineering, procurement, and construction (EPC) mode.

  • Marksans Pharma rises as it receives an Establishment Inspection Report (EIR) from the USFDA for its Goa facility, with a Voluntary Action Indicated (VAI) classification, marking the successful closure of the inspection.

  • Tech Mahindra to sell approximately 103 acres of land and 17 buildings, with a built-up area of around 12.6 lakh sq. ft., to Mahindra University for a total cash consideration of Rs 535 crore. The property is located in Bahadurpally village, Hyderabad.

  • Droneacharya rises sharply as it signs a memorandum of understanding (MoU) with SISIR Radar to become the exclusive seller of SISIR's products in Southeast Asia and Africa. 

  • Granules India rises as it receives USFDA approval for Glycopyrrolate Oral Solution, a medication used manage drooling in children with neurological conditions. The drug is bioequivalent to Merz Pharmaceuticals' Cuvposa.

  • PSU Banks like Union Bank of India, Bank of Baroda, Indian Bank, and Bank of India rise more than 2% in trade. All constituents of the broader Nifty PSU Bank index are trading in the green.

  • Nucleus Software Exports rises sharply, hitting a 20% upper circuit as its board of directors considers a proposal to buyback fully paid-up equity shares. The board will meet on August 22 to discuss the proposal.

  • Managing Director of Blue Star, B Thiagarajan, expects the AC industry's volumes to grow to 30 million units by 2030 from 14 million in 2024. He adds that the company's sales growth was below the industry average as it failed to meet the surge in demand. 

  • Rameshchandra Shah and Sanjay Shah, promoters of Prudent Corporate Advisory, sell a 2.4% stake in the company worth Rs 251 crore in a block deal on Tuesday.

  • KR Choksey keeps its 'Accumulate' rating on Gujarat Fluorochemicals with a higher target price of Rs 3,675 per share. This indicates a potential upside of 10.7%. The brokerage believes that the company's profitability will improve, led by growing traction in the new fluoropolymers business and demand from Indian and global customers for the battery chemical business. It expects the company's net profit to grow at a CAGR of 67.9% over FY25-26.

  • Poly Medicure rises as its board of directors approve the issuance of shares worth Rs 1,000 crore through a qualified institutional placement (QIP). The board sets a floor price of Rs 1,880.7 per share for the QIP.

  • Kolte-Patil Developers plans to launch 15 projects in Pune, Mumbai, and Bengaluru with 9 million square feet of development area and a combined gross development value (GDV) of Rs 8,000 crore. Atul Bohra, CEO of the company, notes, "We foresee our pre-sales numbers around Rs 3,500 crore for FY25, with a revenue guidance of Rs 1,800 crore.” 

  • Sequent Scientific rises sharply to its all-time high of Rs 175 after receiving prequalification approval from the World Health Organisation (WHO) for its Albendazole API, used for treatment of worm infections like pork tapeworm. The approval was secured in partnership with Mepro Pharmaceuticals.

  • Greaves Cotton is rising as its NBFC subsidiary, Greaves Finance, enters a partnership with River Mobility to provide low-interest loans to customers for River's multi-utility electric scooters through its EV-focused lending platform, Evfin.

  • Coforge rises as it partners with Salesforce, to launch Coforge ENZO, a tool that addresses decarbonization and accurately reports greenhouse gas emissions.

  • Arvind Sharma, Director of India-Autos and Trasportation at Citi India, states that the reduction in demand across the auto segments has resulted in an increase in inventory and price cuts. He expects the industry's wholesales to grow at a slower pace compared to last year, projected at 3-3.5% YoY. 

  • Saraswati Saree Depot's shares debut on the bourses at a 21.3% premium to the issue price of Rs 160. The Rs 160 crore IPO has received bids for 107.4 times the total shares on offer.

  • Zomato falls as nearly 20.7 lakh shares (2.2% stake) worth Rs 4,661.4 crore reportedly change hands in a block deal. Antfin Singapore is the likely seller in the transaction.

  • Suraj Estate Developers rises to its all-time high of Rs 847 per share as its board of directors approves the preferential issue of 56.1 lakh shares at an issue price of Rs 714 per share, totaling Rs 399.8 crore.

  • Reports suggest that 44 lakh shares (4% equity) of ADF Foods, amounting to Rs 100 crore, have changed hands in a block deal.  

  • Zuzu Software Services sells a 4% stake (4.9 lakh shares) in Zaggle Prepaid Ocean Services at an average price of Rs 361.2 per share, worth approx Rs 178 crore, in a block deal on Monday.

  • Polycab India rises as UBS reportedly initiates coverage with a 'Buy' call and a target price of Rs 8,550 per share. This indicates a potential upside of 27.2%. The brokerage is confident in the company due to its presence in 40% of the domestic electrification market, strong competitive positioning, and a distribution-led export business model, which can lead to strong topline growth. It expects the firm's revenue to grow at a CAGR of 20% over FY25-27.

  • Hi-Tech Pipes rises to its all-time high of Rs 192.8 per share as it bags an order worth Rs 105 crore to supply steel pipes to a client in the renewable energy sector.

  • IndusInd Bank rises as it receives approval from the Reserve Bank of India (RBI) to establish a subsidiary to undertake mutual fund asset management.

  • Nifty 50 was trading at 24,628.40 (55.8, 0.2%), BSE Sensex was trading at 80,722.54 (297.9, 0.4%) while the broader Nifty 500 was trading at 23,191.05 (51.3, 0.2%).

  • Market breadth is overwhelmingly positive. Of the 1,958 stocks traded today, 1,464 showed gains, and 465 showed losses.

Riding High:

Largecap and midcap gainers today include Torrent Power Ltd. (1,797.35, 7.5%), JSW Energy Ltd. (709.90, 6.2%) and SBI Life Insurance Company Ltd. (1,761.30, 5.4%).

Downers:

Largecap and midcap losers today include Gujarat Fluorochemicals Ltd. (3,283.35, -2.8%), Oil India Ltd. (672.70, -2.4%) and United Breweries Ltd. (1,944, -2.2%).

Volume Shockers

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

Top high volume gainers on BSE included Angel One Ltd. (2,696.90, 15.2%), Vaibhav Global Ltd. (340.85, 12.5%) and Godfrey Phillips India Ltd. (5,845.55, 11.6%).

Top high volume losers on BSE were Whirlpool of India Ltd. (2,061.60, -1.9%) and EIH Ltd. (365.40, -1.6%).

KEI Industries Ltd. (4,709, 7.8%) was trading at 13.0 times of weekly average. Aegis Logistics Ltd. (817.55, 4.8%) and Poonawalla Fincorp Ltd. (399.75, 7.8%) were trading with volumes 10.8 and 8.5 times weekly average respectively on BSE at the time of posting this article.

BSE 500: highs, lows and moving averages

34 stocks overperformed with 52 week highs,

Stocks touching their year highs included - Ashok Leyland Ltd. (260, 1.0%), Aurobindo Pharma Ltd. (1,537.30, 1.2%) and Bombay Burmah Trading Corporation Ltd. (2,510.95, 5.5%).

15 stocks climbed above their 200 day SMA including Usha Martin Ltd. (338.05, 5.8%) and TV18 Broadcast Ltd. (49.04, 3.8%). 5 stocks slipped below their 200 SMA including Gujarat Fluorochemicals Ltd. (3,283.35, -2.8%) and Mishra Dhatu Nigam Ltd. (427.80, -1.6%).

 
Trendlyne Marketwatch
Trendlyne Marketwatch
19 Aug 2024
Market closes flat, ICICI Securities maintains its 'Sell' rating on Mazagon Dock Shipbuilders'
By Trendlyne Analysis

Nifty 50 closed at 24,572.65 (31.5, 0.1%) , BSE Sensex closed at 80,424.68 (-12.2, 0.0%) while the broader Nifty 500 closed at 23,139.75 (83.3, 0.4%). Market breadth is overwhelmingly positive. Of the 2,283 stocks traded today, 1,643 were on the uptick, and 614 were down.

Indian indices closed flat after switching between losses and gains throughout the day. The Indian volatility index, Nifty VIX, fell 0.6% and closed at 14.3 points. CDSL rises to its all-time high of Rs 2,955 as its shareholders approve a bonus issue of shares to equity holders in the ratio of 1:1.

Nifty Smallcap 100 and Nifty Midcap 100 closed in the green. BSE Metal and BSE Oil&Gas were among the top index gainers today. According to Trendlyne’s Sector dashboard, Healthcare Equipment & Supplies emerged as the best-performing sector of the day, with a rise of 6.3%.

Asian indices closed mixed, and European indices are trading mixed as well. US index futures are trading marginally higher, indicating a cautious start to the trading session. Brent crude oil futures are trading lower.

  • Birlasoft sees a long buildup in its August 29 futures series, with open interest increasing by 17.9% and a put-call ratio of 0.3.

  • ICICI Securities maintains a 'Sell' rating on Mazagon Dock Shipbuilders despite margin improvements in Q1FY25 results. The brokerage is cautious due to potential revenue tapering and risks to execution timelines, citing concerns over future performance. It expects the company's revenue to grow at a CAGR of 24.9% over FY25-26.

  • EID Parry (India) approves the early retirement of Managing Director S Suresh, effective August 31. The company appoints Whole-Time Director and CEO Muthiah Murugappan as the new MD, effective September 1.

  • Marine Electricals (India) rises as its subsidiary, Narhari Engineering Works, plans to expand its manufacturing facility in Palghar. The facility will produce naval and marine motors and alternators up to a range of 1 MW.

  • Railway companies report an average decline of around 16% QoQ in their net profits in Q1FY25. The companies’ revenues also declined QoQ; BEML witnessed a 58% decrease, while Ircon and RVNL posted a fall of 39% each.

  • Allcargo Gati reports an 8% MoM increase in total volumes, reaching 1.1 lakh tonnes in July, driven by early festive season preparations. However, volumes are down 3% YoY.

  • Adani Power is reportedly in talks to buy the 600 MW Butibori power plant in Nagpur from Reliance Power's Vidarbha Industries for Rs 2,400-3,000 crore. This acquisition will help Adani connect its nearby Tiroda coal-fired power plant with the Butibori project, enhancing operational efficiency.

  • E2E Networks surges to its all-time high of Rs 2,163.9 per share as its board of directors approves the preferential issue of 24.8 lakh shares at an issue price of Rs 1,694.5 per share, totaling Rs 420.5 crore.

  • India’s domestic air traffic grows 7.3% YoY in July to 1.3 crore passengers, according to the data released by DGCA. IndiGo’s market share rises to 62% in July, while that of Spicejet falls to 3.1%. Air India and Vistara also witness a decline in market share on a MoM basis.

  • Strides Pharma falls as its subsidiary, Strides Alathur, receives a voluntary action indicated classification from the USFDA for its formulations facility in Chennai after a good manufacturing practices (GMP) inspection from April 1 to 5.

  • Zen Technologies rises as it secures a patent grant in India for its 'Mine Detection System'. The system is designed to enhance minefield reconnaissance, planning, and clearance with improved safety and accuracy.

  • Motilal Oswal downgrades Piramal Enterprises to 'Neutral' from 'Buy' with a lower target price of Rs 950 per share. This indicates a potential downside of 2.6%. The brokerage is cautious about the stock as it believes the NBFC will take another 12-15 months to reduce credit costs and improve earnings due to the decline in legacy assets under management (AUM). It expects the firm's AUM to grow at a CAGR of 24% over FY25-26.

  • UBS reiterates its ‘Buy’ rating on Zomato and raises the target price to Rs 320 from Rs 260 earlier. The brokerage says Zomato surprised positively in terms of gross merchandise value (GMV) growth, particularly the 27% YoY growth in food delivery. It lifts GMV estimates by 20-30% for quick commerce and 2-3% for food delivery over FY26-28.

  • Oil exploration & production stocks like Oil India, ONGC, Jindal Drilling & Industries, and Hindustan Oil Exploration are rising in trade as the government reduces the windfall tax on crude to Rs 2,100 per tonne from Rs 4,600 per tonne.

  • Central Depository Services rises sharply to its all-time high of Rs 2,955 as its shareholders approve a bonus issue of shares to equity holders in the ratio of 1:1. The record date for the issue is August 24.

  • Tejas Networks rises as its subsidiary, Saankhya Labs, receives a purchase order worth Rs 96.4 crore from NewSpace India to supply and install satellite communication systems for marine fishing vessels.

  • Electronics Mart India is falling after its promoters Karan Bajaj and Pavan Kumar Bajaj offload a 7.8% stake on Friday. Premchand Devarakonda, the CFO, believes they will not sell a further stake in the near term and hold 65% of the company. He highlights the firm's target of 8-10% SSSG (same-store sales growth), and 15% revenue growth going forward.

  • Media stocks like Saregama India, TV18 Broadcast, Network18 Media & Investments, and PVR INOX rise more than 2% in trade. All constituents of the broader Nifty Media index are trading in the green.

  • GMR Airports Infrastructure rises as its passenger traffic increases 8% YoY to 1.1 crore in July, while aircraft movements grow by 6% YoY to 68,755.

  • Genus Power Infrastructures surges as it receives three orders worth Rs 2,925.5 crore. The contracts involve the design, supply, and installation of 3.7 million smart meters and related infrastructure.

  • Sanjay Banka, CFO of Senco Gold, notes renewed consumer demand for gold due to the decline in customs duty. He says the company’s revenue will grow in the 18-20% range going forward, and remains confident of maintaining leadership in eastern India.

  • Techno Electric & Engineering rises sharply as it enters a partnership with Indigrid to set up two greenfield interstate transmission system (ISTS) projects. As per the partnership, Techno Electric will co-develop and invest a minority stake in Indigrid's Ishanagar Power Transmission and Dhule Power Transmission.

  • Tamilnad Mercantile Bank rises sharply as the Reserve Bank of India (RBI) approves the appointment of Salee Sukumaran Nair as the bank's Managing Director and CEO for the next three years.

  • DCX Systems surges as it receives orders worth Rs 107 crore from domestic and overseas customers to supply electronic kits and cable & wire harness assemblies.

  • Escorts Kubota is rising as it submits an investment intent to the government of Uttar Pradesh to acquire industrial land to set up a greenfield manufacturing facility with an estimated capex of Rs 4,500 crore. The company expects an annual revenue of Rs 10,000 crore from the plant at full capacity.

  • Nifty 50 was trading at 24,612 (70.9, 0.3%), BSE Sensex was trading at 80,680.25 (243.4, 0.3%) while the broader Nifty 500 was trading at 23,149.05 (92.6, 0.4%).

  • Market breadth is highly positive. Of the 2,019 stocks traded today, 1,549 showed gains, and 417 showed losses.

Riding High:

Largecap and midcap gainers today include Varun Beverages Ltd. (1,508.40, 6.1%), Voltas Ltd. (1,607.70, 4.7%) and General Insurance Corporation of India (399.60, 4.0%).

Downers:

Largecap and midcap losers today include Hindustan Zinc Ltd. (495.70, -4.7%), APL Apollo Tubes Ltd. (1,357, -3.6%) and Mahindra & Mahindra Ltd. (2,765.15, -2.7%).

Crowd Puller Stocks

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

Top high volume gainers on BSE included Caplin Point Laboratories Ltd. (1,845.95, 16.4%), Godfrey Phillips India Ltd. (5,238.60, 15.5%) and IIFL Finance Ltd. (454.05, 12.1%).

Top high volume losers on BSE were Hindustan Zinc Ltd. (495.70, -4.7%), Kalyan Jewellers India Ltd. (549.55, -4.1%) and Ujjivan Small Finance Bank Ltd. (41.29, -1.6%).

Angel One Ltd. (2,341.20, 8.4%) was trading at 8.8 times of weekly average. Bombay Burmah Trading Corporation Ltd. (2,379.90, 4.2%) and Zydus Wellness Ltd. (2,240, 0.7%) were trading with volumes 6.9 and 5.2 times weekly average respectively on BSE at the time of posting this article.

BSE 500: highs, lows and moving averages

31 stocks hit their 52 week highs,

Stocks touching their year highs included - Ashok Leyland Ltd. (257.50, 0.6%), Aurobindo Pharma Ltd. (1,519.20, 1.1%) and Bombay Burmah Trading Corporation Ltd. (2,379.90, 4.2%).

20 stocks climbed above their 200 day SMA including eClerx Services Ltd. (2,698.70, 8.5%) and Elgi Equipments Ltd. (635, 5.7%). 2 stocks slipped below their 200 SMA including EIH Ltd. (371.15, -1.2%) and Nestle India Ltd. (2,505.05, -0.8%).

 
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The Baseline
16 Aug 2024
Five Interesting Stocks Today - August 16, 2024

1. Voltas:

This consumer electronics company surged 10.8% on Monday after announcing Q1 results that beat estimates on all fronts. The company reported revenue growth of 45.8% YoY, reaching Rs 5,001.3 crore in Q1FY25, surpassing Trendlyne’s Forecaster estimate by 9%. Net profit rose 158.5% YoY to Rs 334.2 crore, beating the estimate by 35.9%.

If we look at the revenue mix, the company’s cooling products segment, which contributed more than 75% to its topline, saw volume growth of 67%. The heat waves drove demand up during the peak summer months, powering the segment’s revenue higher by 51% on a YoY basis. The electro-mechanical projects segment also saw revenue growth of 40% YoY to Rs 949 crore.

Voltas saw its market share fall to 18.7% in FY24 in air conditioners, down from 21.6% in FY23. Meanwhile, its major competitor Blue Star’s market share rose by 25 bps to 13.8%.and hopes to drive it higher by 100 bps every year. 

In its latest annual report, the company projects the overall AC market to grow at a CAGR of 10% in FY25-28. Managing Director and CEO, Pradeep Bakshi, said, “The company has begun the groundwork to set up a manufacturing plant in Tamil Nadu to cater the rising demand for ACs which has grown by 75% in the past few quarters.” He highlights that this facility will have a manufacturing capacity of 2 million cooling units and focus mainly on southern and western India.

BOB Capital Markets maintains its ‘Hold’ rating on Voltas as they are optimistic about future growth, considering the under penetration of ACs in India. They are also upbeat about the growth outlook of its home appliances brand ‘Voltas Beko’ which manufactures fridges, washing machines, etc. as it achieved 12% of sales from e-commerce channels in FY24.

2. Signatureglobal (India):

This realty company has risen 296.8% since its listing on September 23 of last year and has surged 8.9% in the past week following its results announcement on August 7. The company reported a net profit of Rs 6.8 crore in Q1FY25 compared to a net loss of Rs 7.2 crore in Q1FY24. Its operating revenue grew 141.5% YoY to Rs 400.6 crore, driven by a 148% YoY rise in sales in the real estate segment. It beat Forecaster revenue estimates by 92.6%.

Revenue growth was driven by the company’s pre-sales, which reached Rs 3,120 crore in Q1FY25, marking a remarkable growth of 255% YoY with a 63% CAGR in pre-sales over FY21-24. Pradeep Kumar Aggarwal, Chairman and Whole-Time Director, said, "In the first quarter itself, we have achieved 30% of our annual pre-sales target. We are planning to launch a few projects over the coming quarters, which are likely to boost our operational targets.” The growth is primarily due to the successful launch of Phase 1 of the group housing project 'TITANIUM SPR' in Sector 71, Gurgaon – the project has accounted for 87% of sales.

The company plans to increase its launches by four-fold YoY to 32 million sq. ft. (msf) worth Rs 16,000 crore in FY25 (from Rs 4,200 crore in FY24). Some of the existing projects in the pipeline for FY25 include premium projects in Gurgaon at Sector 71, Sector 84 and Sector 37D, worth Rs 8,700 crore, as well as mid-income projects with independent floors at Sohna, Haryana with gross development value (GDV) of approximately Rs 5,800 crore. Additionally, the company will launch industrial plot projects at Sohna and Manesar in Haryana, worth Rs 1,500 crore.

In Q4FY24 Signatureglobal had launched its first premium project, Deluxe-DXP at Sector 37D in Gurugram, which sold out in 48 hours. Its second high-priced project also received a strong response, with 85% of inventory sold at launch.

Motilal Oswal has initiated a ‘Buy’ rating with a target price of Rs 2,000. The brokerage believes that the strong pre-sales growth will lead to a rapid scale-up across key parameters, such as cash flows, revenue and profitability, enhancing the company’s execution capability and future growth potential. The firm expects the growth momentum to remain intact and estimates that Signatureglobal will deliver a 35% CAGR in bookings over FY25-27.

3. FSN E-Commerce (Nykaa): 

This internet retail company rose over 1% after its net profit surged 191.9% YoY to Rs 9.6 crore in Q1FY25. Revenue rose 22.8% YoY to Rs 1,746.1 crore during the quarter, driven by growth in the beauty & personal care (BPC) and fashion segments. The company’s revenue was in line with Trendlyne’s Forecaster estimates, but profit missed estimates by 43.5%. 

During the quarter, Nykaa’s GMV (gross merchandise value) grew 25% YoY, with the BPC segment’s (constituting over 76% of the total GMV) GMV rising 28%. Nykaa’s owned brands GMV grew 47% YoY in Q1. The fashion segment (which makes up 23% of the total GMV) saw its GMV increase by 15% YoY in a highly competitive space. Analysts noted that fashion GMV growth was slower compared to 27% in Q4FY24, due to a drop in store visits, and slower demand amid fewer wedding dates during the quarter. Nykaa provided discounts across its beauty and fashion categories due to the lack of festivities, but expects discounts to moderate in Q3 and Q4 as demand picks up in the festive season.

Meanwhile, Nykaa continued to expand its retail network, with stores reaching the 200 mark. During the quarter, the company announced the acquisition of an additional 39% stake in Dot & Key Wellness for Rs 265.3 crore. With this, company's stake will increase from 51% to 90%. Earlier in March the e-commerce company entered the GCC (Gulf Cooperation Council) Beauty space, under the brand Nysaa. GCC Beauty is estimated to be a $30 billion market and the company expects this to be a significant growth driver in the future.

Nykaa increased its warehouse count to 44 in Q1, with an aim to improve its delivery timelines. Falguni Nayar said, “Given the investments we have made in the space, our key objective is to improve consumer experiences by getting the product into the consumer’s hands faster. We aim to deliver 70–80% of orders placed in major cities and 50% of other cities, on the same day or the next day by September”.

ICICI Securities maintains its ‘Add’ rating with a target price of Rs 210. The brokerage remains cautious on the company and believes success in the fashion business can be difficult given the intense competition in the category. 

4. Aurobindo Pharma: 

This pharmaceuticals company rose by 4.1% in three sessions after posting its Q1FY25 results on Saturday. Its revenue increased by 10.5% YoY to Rs 7,567 crore, in line with Forecaster estimates, driven by improvements in the US, Europe, and in rest of the world (ROW) formulations, as well as a rise in the active pharmaceutical ingredient segment. 

The company’s stock price rose by 4.5% on August 7 after it received final approval from the US FDA to manufacture and market Estradiol Vaginal Inserts. The drug is a generic equivalent of Novo Nordisk’s VAGIFEM, and has an estimated market size of $268 million. However, it pared its gains on Friday and fell 2% after the US FDA issued a warning letter for its Eugia II formulations manufacturing plant.

Aurobindo’s net profit grew by 61.5% YoY to Rs 919.2 crore, backed by reduced raw material costs. However, net profit still missed Forecaster estimates by 3.1%. The US formulations segment (which contributes to 47% of total revenue) witnessed just 8% revenue growth YoY. Growth was helped by improvements in specialty and injectables. 

Growth was muted and in single digits due to the remedial actions taken by the company after the US FDA issued an official action indicated (OAI) status on its Eugia III plant. The rest of the world (ROW) formulations experienced a 49.2% YoY rise in revenue during the quarter, led by new product launches. 

The company has been rapped on the knuckles multiple times by the FDA this year, and received multiple Form 483s or its Eugia plant in India since December 2023. This has resulted in a hit of $30-40 million in its revenue in Q4FY24 and Q1FY25, combined with a remediation cost of $8-9 million for the plant. These consistent issues have led to the company posting a 3-year revenue CAGR of 5.5%, which is lower than its competitors like Cipla (10.9%), Dr Reddy’s Laboratories (14.3%) and Sun Pharmaceutical Industries (13.2%). As a result, the company has developed the Vizag plant as a back-up and expects US FDA approval by the end of FY25. Puvvala Yugandhar, CEO of Eugia, expects the plant to be running at full capacity from Q2FY25 onwards.

Speaking on the company’s results, its Vice-Chairman and MD, K Nithyananda Reddy, says, “Our EBITDA margin remained at 21.4% and is in line with expectations. EBITDA margins are supported by stable raw material prices. We are confident in our ability to achieve our EBITDA growth target of 21-22% for FY25. We also expect the current pricing scenario in the US market to continue.” 

Post results, Axis Direct maintains its ‘Buy’ call on the company with a higher target price of Rs 1,612 per share. This indicates a potential upside of 7.3%. The brokerage remains confident about the stock due to its new launches in the US formulations and planned entry into biosimilars, peptides, and contract development & manufacturing organizations (CDMO) services. It expects the company’s revenue to grow at a CAGR of 5.7% over FY25-26.

5. Oil India:

This oil exploration and production company rose by 10.6% over the past week after the Ministry of Petroleum and Natural Gas approved a 20% premium on gas prices from new wells. Oil India plans to grow its gas output by 50% over FY25-26, building gas production infrastructure to increase domestic production.

The company’s net profit rose 32.2% YoY to Rs 1,885.8 crore, helped by inventory destocking. Revenue grew 30.9% YoY to Rs 9,350 crore in Q1FY25, beating Trendlyne’s Forecaster estimates by 70%. The Gross Refining Margin (GRM) of Numaligarh Refinery (NRL) stood at $6.4 per barrel in Q1FY25, compared to a negative margin of $15.6 per barrel in Q1FY24. 

Analysts predict that the GRM across the industry will decline to $6-8 per barrel in FY25, down from an average of $10-12 per barrel in FY24 – a narrowing discount on Russian crude and a decrease in the profit margin from selling refined products are impacting GRMs.

The company’s NRL expansion project, with a total cost of Rs 28,000 crore, has achieved 65% progress and is expected to be completed by December 2025. CFO Rupam Baura said “Once the new capacity is installed, we expect it to operate at around 50-60% in the first year, gradually ramping up to 90% by the second year. This expansion will increase the refinery’s capacity from 3 MMTPA to 9 MMTPA.” The firm plans to build a gas pipeline to connect the stranded North Brahmaputra fields which has a capacity of 3 bcm, equivalent to FY24 gas production.

Post results, Prabhudas Lilladher has upgraded the stock to ‘Buy’ with a raised target price of Rs 766. This indicates a potential upside of 13%. It remains positive about the NRL expansion, expecting it to boost gas production. Prabhudas Lilladher predicts that Oil India will see volume CAGRs of 8% for oil and 16% for gas over FY25-26.

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

 
Trendlyne Marketwatch
Trendlyne Marketwatch
16 Aug 2024
Market closes higher, Reliance Power's Q1FY25 net loss decreases 67% YoY to Rs 97.9 crore
By Trendlyne Analysis

Nifty 50 closed at 24,541.15 (397.4, 1.7%) , BSE Sensex closed at 80,436.84 (1,331.0, 1.7%) while the broader Nifty 500 closed at 23,056.50 (383.9, 1.7%). Market breadth is surging up. Of the 2,235 stocks traded today, 1,511 were in the positive territory and 693 were negative.

Indian indices closed higher after extending gains throughout the day. The Indian volatility index, Nifty VIX, fell 6.7% and closed at 14.4 points. Glenmark Pharmaceuticals closed almost 5% higher as its Q1FY25 net profit surged 126.9% YoY to Rs 340.2 crore, while revenue rose 7.2% YoY to Rs 3,275.7 crore.

Nifty Midcap 100 and Nifty Smallcap 100 closed in the green. Nifty IT and Nifty Realty closed higher. According to Trendlyne’s sector dashboard, Software & Services emerged as the best-performing sector of the day, with a rise of 2.9%.

Most European indices trade higher, except UK’s FTSE 100 and Russia’s RTSI and MOEX indices. All Asian indices closed in the green. US index futures traded higher, indicating a positive start to the trading session. UK retail sales increased by 1.4% YoY in July compared to a fall of 0.3% in June, according to the Office for National Statistics.

  • Relative strength index (RSI) indicates that stocks like Triveni Turbine, Colgate-Palmolive (India), V-Guard Industries, and Granules India are in the overbought zone.

  • Motilal Oswal initiates coverage on Signatureglobal (India) with a 'Buy' call and a target price of Rs 2,000 per share. This indicates a potential upside of 31.5%. The brokerage is positive on the stock as it believes that growth in pre-sales will lead to a scale-up in revenue and profitability. It expects the company's revenue to grow at a CAGR of 105% over FY25-26.

  • Reliance Power surges as its Q1FY25 net loss decreases 67% YoY to Rs 97.9 crore, driven by lower employee benefit expenses and reduced finance costs. Revenue rises 3.7% YoY to Rs 1,992.2 crore during the quarter. The company appears in a screener of stocks where mutual funds increased their shareholding over the past two months.

  • IT stocks like MphasiS, L&T Technology Services, Wipro and Tech Mahindra rise more than 3% in trade. All constituents of the broader Nifty IT index are also trading in the green, helping it to surge more than 2%.

  • HSBC initiates a ‘Buy’ rating on the recently listed Ola Electric with a target price of Rs 140. The brokerage believes EV manufacturing costs will decline substantially by FY27/28, while ICE (internal combustion engine) scooters may increase due to emission standards. It sees Ola as a buying opportunity citing lower costs and a positive risk-reward for its battery venture.

  • KDDL falls as its Q1FY25 net profit drops 33.1% YoY to Rs 17.3 crore. However, revenue rises 8.6% YoY to Rs 359.9 crore during the quarter, driven by higher sales in the watches, accessories and luxury items segment. The company appears in a screener of stocks with improving ROA over the past two years.

  • Foreign institutional investors sell equity worth Rs 4,870.5 crore in the market over the past week, according to Trendlyne's FII dashboard. Index options witness the highest inflow of Rs 46,332.3 lakh crore from foreign investors. Meanwhile, mutual funds are net buyers in the equity market, investing Rs 5,379.8 crore during the same period.

  • Polyplex Corp surges as it reports a net profit of Rs 53.5 crore in Q1FY25 compared to a loss of Rs 3.1 crore in Q1FY24 due to reduced expenses on stock purchases and inventory destocking. Revenue grows 8% YoY to Rs 1,685.6 crore during the quarter. The company appears in a screener of stocks where mutual funds increased their shareholding over the past two months.

  • Aditya Saraogi, CFO of Birla Corp, says H1FY25 will be challenging for the company, but expects a strong recovery in the second half. He highlights the company’s capex at Rs 800 crore for FY25, and projects debt at Rs 3,150 crore.

  • SpiceJet's net profit declines by 19.9% YoY to Rs 158.3 crore in Q1FY25 due to higher aircraft lease costs. Revenue falls by 8.3% YoY to Rs 2,077.8 crore, caused by a reduction in the air transport services segment. It shows up in a screener of stocks with declining cash flow from operations over the past two years.

  • KIOCL falls as its Q1FY25 net loss decreases 12.6% YoY to Rs 50.7 crore. Revenue declines 70.6% YoY to Rs 147.4 crore during the quarter, reportedly due to a forced shutdown of operations caused by a collapse in the national market. The company features in a screener of stocks with declining revenue over the past two quarters.

  • HDFC Life Insurance receives a tax demand order of Rs 112 crore from the Commercial Tax Officer, Chandigarh. The company plans to appeal the demand order with the Appellate Authority within the specified period.

  • Srinivasan Nadadhur, CFO of Eclerx Services, expects margin recovery over the next three quarters. He highlights the company’s target of achieving double-digit revenue growth in FY25, with margins around 24-28%. Nadadhur adds that the deal pipeline looks healthy, with a majority of opportunities in the financial services space.

  • GMR Power and Urban Infra surges as it reports a net profit of Rs 1,225.2 crore in Q1FY25 compared to a loss of Rs 205.3 crore in Q1FY24. Revenue grows 43.4% YoY to Rs 1,611.9 crore during the quarter, driven by higher sales in the power and roads segment. The company appears in a screener of stocks with increasing profits over the past four quarters.

  • Axis Direct keeps its 'Buy' call on Happiest Minds Technologies with a lower target price of Rs 930 per share. This indicates a potential upside of 21.1%. The brokerage remains positive on the stock as it is well-placed to deliver strong growth, driven by multiple long-term contracts with the world’s leading brands. It expects the company's revenue to grow at a CAGR of 13.5% over FY25-26.

  • Ola Electric Mobility surges as its revenue grows by 34.3% YoY to Rs 1,718 crore in Q1FY25, led by an improvement in the automotive business. However, its net loss expands by 30% YoY to Rs 347 crore due to higher raw material and employee benefits expenses. The company also enters the motorcycle segment by launching a Roadster portfolio in the price range of Rs 75,000 to Rs 2 lakh.

  • Analysts expect that Adani Energy Solutions could see inflows of around $250 million by August end, after MSCI announced it lifted restrictions on Adani stocks, making them eligible for inclusion in the MSCI India index.

  • Sunteck Realty surges as it reports a net profit of Rs 22.8 crore in Q1FY25 compared to a loss of Rs 6.7 crore in Q1FY24. Revenue grows 348.2% YoY to Rs 316.3 crore during the quarter, driven by increased collections and pre-sales. The company appears in a screener of stocks where mutual funds increased their shareholding over the past two months.

  • Aurobindo Pharma falls sharply as it receives a warning letter from the US FDA for its Eugia III formulation manufacturing plant. This comes after the plant received an official action indicated (OAI) status from the US FDA on the plant on May 25.

  • Electronics Mart India rises as nearly 3.1 crore shares (8% stake), amounting to Rs 712.6 crore, reportedly change hands in a block deal at an average price of Rs 232 per share.

  • Morgan Stanley maintains its ‘Overweight’ rating on Zomato with a target price of Rs 278. The brokerage notes the rising competitive intensity in the quick commerce business, which could delay profitability assumptions. It also emphasises that retaining market leadership is crucial for the company's long-term success.

  • KNR Constructions surges as its Q1FY25 net profit rises 25.9% YoY to Rs 172.6 crore, driven by lower expenses on the cost of materials, subcontracts and spreading & assortment. Revenue grows marginally by 0.4% YoY to Rs 985 crore during the quarter. The company features in a screener of stocks with improving net cash flow from past two years.

  • Glenmark Pharmaceuticals' Q1FY25 net profit surges 126.9% YoY to Rs 340.2 crore, owing to lower raw material and finance costs. Revenue rises 7.2% YoY to Rs 3,275.7 crore, helped by improvements in the Indian, European, and rest of the world (ROW) markets. It appears in a screener of stocks outperforming their industries in the past quarter.

  • Power Mech Projects surges as it receives a Rs 114.3 crore contract from Coastal Energen for the operation and maintenance of the 1,200 megawatt (MW) Mutiara Thermal Power Plant.

  • Paras Defence and Space Technologies surges as it secures a Rs 305 crore order from Larsen & Toubro to manufacture and supply 244 Sight-25HD EO (electro-optics) systems, including extended warranty and logistics support, for their CIWS program.

  • The market opened on an upbeat note. Nifty 50 was trading at 24,342.40 (198.7, 0.8%), BSE Sensex was trading at 79,726.41 (620.5, 0.8%) while the broader Nifty 500 was trading at 22,855.15 (182.5, 0.8%).

  • Market breadth is highly positive. Of the 1,944 stocks traded today, 1,590 were gainers and 319 were losers.

Riding High:

Largecap and midcap gainers today include PB Fintech Ltd. (1,691.95, 7.5%), MphasiS Ltd. (2,910.95, 7.1%) and Aditya Birla Capital Ltd. (216.09, 6.2%).

Downers:

Largecap and midcap losers today include Hindustan Zinc Ltd. (519.90, -9.1%), Varun Beverages Ltd. (1,421.85, -2.8%) and Adani Energy Solutions Ltd. (1,085.30, -2.6%).

Volume Shockers

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

Top high volume gainers on BSE included Zensar Technologies Ltd. (797.60, 7.7%), Nippon Life India Asset Management Ltd. (686.85, 7.5%) and MphasiS Ltd. (2,910.95, 7.1%).

Top high volume losers on BSE were Hindustan Zinc Ltd. (519.90, -9.1%) and J B Chemicals & Pharmaceuticals Ltd. (1,966.50, -0.1%).

RHI Magnesita India Ltd. (627.35, 6.0%) was trading at 59.7 times of weekly average. Firstsource Solutions Ltd. (307.70, 6.0%) and L&T Technology Services Ltd. (5,207.55, 5.9%) were trading with volumes 9.3 and 6.9 times weekly average respectively on BSE at the time of posting this article.

BSE 500: highs, lows and moving averages

20 stocks overperformed with 52 week highs, while 1 stock tanked below their 52 week lows.

Stocks touching their year highs included - CCL Products India Ltd. (683.65, 2.9%), Colgate-Palmolive (India) Ltd. (3,534.65, 1.9%) and Coromandel International Ltd. (1,759.75, 4.3%).

Stock making new 52 weeks lows included - CreditAccess Grameen Ltd. (1,222, 3.8%).

21 stocks climbed above their 200 day SMA including Piramal Enterprises Ltd. (947.35, 7.4%) and RHI Magnesita India Ltd. (627.35, 6.0%). 10 stocks slipped below their 200 SMA including Olectra Greentech Ltd. (1,608.40, -2.1%) and KIOCL Ltd. (407.45, -1.9%).