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The Baseline
16 Apr 2024
5 stocks to buy from analysts this week - April 16, 2024
By Satyam Kumar

1. Endurance Technologies:

Hem Securities reiterates a ‘Buy’ call on this auto parts manufacturer with a target price of Rs 2,219, indicating an upside of 20.8%. Analyst Abhishek Sharda say, “Endurance Technologies has a very strong positioning in the two-wheeler market and it is a very good proxy for the Indian two-wheeler industry.” 

Sharda is optimistic about the company due to its strong order wins both in Europe and India. Order wins from India stood at Rs 940 crore in 9MFY24 and orders from Europe were 29 million euro. The analyst expects the orders to peak in FY26. 

Sharda believes that the company has a diverse revenue profile in terms of geography, products and vehicles. He also believes that it is ready for the trend shift towards electric vehicles. Sharda expects EBITDA margins to improve on the back of improving capacity utilisation. He concludes, “Endurance Technologies will continue to focus on emerging technologies to grow its portfolio through both organic and inorganic routes.”

2. Coforge:

Sharekhan maintains a ‘Buy’ rating on this IT consulting and software company with a target price of Rs 7,670. This indicates an upside of 42.1%. Analysts at Sharekhan point to the company’s strong order book and large deal pipeline. “The company is well placed to deliver a top quadrant performance in FY25,” they note. Coforge has strong revenue visibility with an order book of $974 million as of Q3FY24 (up 15.8% YoY) to be executed over the next year.

Analysts are also optimistic as the company plans to raise Rs 3,200 crore from qualified institutional placements (QIP). Coforge intends to use these funds purely for mergers and acquisitions. They expect this to help the company quickly expand into new verticals such as cyber security, data services, and cloud operations. They also expect a sharp uptick in Coforge’s EBITDA margins in Q4FY24 owing to deal ramp-ups. Analysts at Sharekhan expect sales and profit CAGR of 17% and 32% respectively over FY24-26. 

3. Glenmark Pharmaceuticals:

KRChoksey maintains a ‘Buy’ rating on this pharmaceutical company with a target price of Rs 1,266, indicating an upside of 21.3%. Analyst Unnati Jadhav is upbeat as the completion of the sale of Glenmark Lifesciences strengthens the balance sheet and earnings prospects of the company. She expects this deal to help Glenmark Pharma to become a ‘brand-led’ organization, with a focus on the core therapeutic areas of dermatology, respiratory, and oncology. She believes the total debt of Rs 4,953 crore will be repaid in FY25 from the proceeds of the deal, which in turn will save finance costs and boost earnings.

Jadhav is optimistic as the company has shown higher than market growth for the months of January and February 2024 for the India pharma market (IPM). While IPM growth was 9.5% YoY for January 2024, Glenmark Pharma grew 20.2% over the same period. In February 2024, the company reported 11.3% YoY growth vs overall IPM growth of 9.0%. She attributes this to changes in the distribution model involving stock point consolidation and channel inventory rationalization in the domestic business. Going forward, Jadhav expects this move to improve Glenmark’s operating margins and working capital.

4. Shalby:

ICICI Direct maintains a ‘Buy’ rating on this healthcare facilities company with a target price of Rs 320, indicating an upside of 18.7%. Analyst Siddhant Khandekar is upbeat as the company introduced the asset-light franchisee model to expand its hospital business into newer geographies. The company owns 10 multispecialty hospitals and 6 franchisee hospitals with a 2,362 bed capacity. Khandekar expects the company to expand its Shalby Centre for Orthopaedic Excellence (SOCE), an asset-light franchisee model, across India. It has established six such models across the country and expects to add 40 more over the next 4-5 years.

Khandekar believes that the company is trading at a cheap valuation compared to other PAN-India players. He is optimistic as the headwinds faced in FY24 in Shalby’s implants business look transitory. The company plans to expand its business beyond the US and India to improve profitability going forward. 

5. Man Infraconstruction:

Axis Direct initiates a ‘Buy’ call on this construction and engineering company with a target price of Rs 270. This indicates an upside of 28.8%. Analysts Eesha Shah and Preeyam Tolia are optimistic about the company on the back of its healthy project pipeline and strong execution capabilities. 

Man Infraconstruction has invested Rs 700 crore in real estate projects, covering a portfolio of 4.6 million square feet. The firm also maintains zero level of inventory of completed projects. The firm is expected to generate a revenue of Rs 1,343 crore with a net cash surplus of Rs 350 crore in FY24 (whereas its peer, Brigade Enterprises is expected to generate revenue of Rs 4,200 crore with a net debt of Rs 2,140 crore). The analysts believe that this asset-light model for a real estate developer makes it an attractive company in the segment. 

The analysts like the company due to its order book and project pipeline. Currently, the firm has 2 million square feet of ongoing projects and 3.7 million square feet of upcoming real estate projects. Its EPC business order book stands at Rs 1,047 crore. 

Shah and Tolia say that the company exhibits a very low debt book for a real estate developer. They conclude, “Due to its asset-light business model, it can scale up without significant capital pressure, thereby improving the bottom line in coming years.”

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

(You can find all analyst picks here)

 
Trendlyne Marketwatch
Trendlyne Marketwatch
16 Apr 2024
Market closes lower, Crisil's Q4FY24 net profit falls 5.5% YoY to Rs 137.7 crore
By Trendlyne Analysis

Nifty 50 closed at 22,147.90 (-124.6, -0.6%), BSE Sensex closed at 72,943.68 (-456.1, -0.6%) while the broader Nifty 500 closed at 20,423 (-55.8, -0.3%). Market breadth is in the green. Of the 2,055 stocks traded today, 1,315 were on the uptrend, and 703 went down.

Indian indices maintained the losses from the afternoon session and closed in the red. The volatility index, Nifty VIX, rose by 1.2% and closed at 12.6 points. Crisil's Q4FY24 net profit fell 5.5% YoY to Rs 137.7 crore. Its revenue decreased by 3.6% YoY to Rs 758.8 crore due to a fall in revenue from the research, analytics, and solutions segment.

Nifty Midcap 100 closed flat, while Nifty Smallcap 100 closed higher with the benchmark index closing in the red. Nifty Media and Nifty Oil & Gas closed higher than Monday’s closing level. According to Trendlyne’s sector dashboard, hardware technology & equipment emerged as the top-performing sector of the day, with a rise of over 1.4%. 

Most European indices trade in the red. US indices futures trade lower, indicating a negative start. China’s industrial production in March grew 4.5% YoY against estimates of 5.4% growth. The first two months of 2024 saw China’s industrial production increase by 7%.

  • Relative strength index (RSI) indicates that stocks like Exide Industries, Thermax, Vedanta and Honeywell Automation India are in the overbought zone.

  • Dynacons Systems & Solutions surges to its 20% upper circuit after bagging a Rs 233 crore order to supply its core banking solution upgrade & migration on the ASP model to the National Bank for Agriculture and Rural Development (NABARD).

  • Crisil's Q4FY24 net profit falls 5.5% YoY to Rs 137.7 crore. Its revenue decreases by 3.6% YoY to Rs 758.8 crore due to a fall in revenue from the research, analytics and solutions segment. The company appears in a screener for stocks with no debt.

  • India implements port restrictions on the export of prohibited or restricted essential commodities recently approved for shipment to the Maldives, as per the Directorate General of Foreign Trade (DGFT). Exports will now be permitted only through four customs stations, including Mundra Sea Port and Tuticorin Sea Port.

  • Steel Strips Wheels is rising as it signs an agreement with a PV original equipment manufacturer (OEM) to supply aluminium wheels.

  • Max Healthcare Institute to invest Rs 5,000 crore to double its bed capacity to over 8,000 in the next four to five years.

  • Motilal Oswal reiterates its 'Buy' rating on Tata Consultancy Services with a target price of Rs 4,600. This indicates a potential upside of 18.4%. The brokerage believes that the company is well-positioned to withstand the weakening macro environment due to its strong order book, exposure to long-duration orders and portfolio. It expects the company's revenue to grow at a CAGR of 10.5% over FY24-26.

  • Food Secretary Sanjeev Chopra states that despite a 5.5% YoY inflation in sugar, there are no supply-side shocks, and sugarcane farmers are receiving their dues on time. He adds that the industry would benefit from redirecting an additional 8 LMT of sugarcane for ethanol, compared to the earlier 17 LMT diversion.

  • Coal India’s capital expenditure rises by 6.5% YoY to Rs 19,840 crore in FY24. The company achieves 120% target satisfaction over the year’s target of Rs 16,500 crore.

  • IT stocks like Infosys, Coforge, LTIMindtree and Mphasis are falling in trade. The broader sectoral index, Nifty IT, is also trading in the red.

  • Happy Forgings surges as it bags an order to supply brake flanges for passenger vehicles to a tier 1 manufacturer of automobile driveline components and systems. The supply will begin in Q4FY26 and last till Q3FY35, with the company expected to receive Rs 60-70 crore per annum.

  • Jefferies initiates a 'Buy' rating on Bharti Hexacom with a target price of Rs 1,081. The brokerage notes the company's presence in markets with lower tele-density and better historical translation of tariff hikes into average revenue per user (ARPU), indicating a promising growth outlook.

  • PNC Infratech's arm PNC Raebareli Highways receives Rs 117.2 crore from the National Highways Authority of India as a one-time settlement for contractual disputes.

  • Caplin Point Laboratories is rising as its arm, Caplin Steriles, receives final approval from the US FDA for its Ofloxacin Ophthalmic Solution (eye drops). It is used for the treatment of eye infections and has an estimated annual sales of $52 million in the US.

  • Welspun Corp's US subsidiary, Welspun Tubular, files a lawsuit against a customer in the Superior Court of the State of Delaware for claims worth $15 million (approx. Rs 125.3 crore) for cancelling an order.

  • Jefferies maintains a 'Buy' rating on IDFC First Bank with a target price of Rs 100. The brokerage expects margin expansion driven by strong deposit figures. It highlights the importance of credit quality and notes that the rise in Return on Equity (RoE) will be crucial.

  • Sterlite Technologies surges following the announcement that it has raised Rs 1,000 crore through a Qualified Institutional Placement.

  • Jio Financial Services rises sharply as it forms a 50:50 joint venture (JV) with Blackrock to set up a wealth management and broking company.

  • Varun Beverages is rising as Morgan Stanley reportedly initiates coverage on the stock with an 'Overweight' rating and a target price of Rs 1,701. This indicates a potential upside of 21.6%. The brokerage is optimistic about the company's ability to outperform the non-alcoholic beverages industry, citing its track record of capitalizing on domestic and global opportunities and strong profitability.

  • The Centre raises the windfall tax on locally produced petroleum crude oil to Rs 9,600 per tonne from Rs 6,800 earlier. It keeps the tax on diesel and aviation turbine fuel (ATF) unchanged at ‘Nil’.

  • Rakesh Jhunjhunwala's portfolio sells a 0.6% stake in NCC in Q4FY24. It now holds a 12.5% stake in the company.

  • Vijay Kedia adds Mahindra Holidays & Resorts India to his portfolio in Q4FY24. He buys a 1% stake in the company.

  • Radhakishan Damani buys a 1.5% stake in VST Industries for approx Rs 86.3 crore in a bulk deal on Monday.

  • Cipla's subsidiary, Cipla Health, acquires Ivia Beaute's cosmetics and personal care business for Rs 130 crore, with an additional payment of Rs 110 crore upon meeting certain financial targets over the next three years.

  • Gloom in markets in early trading. Nifty 50 was trading at 22,148.05 (-124.5, -0.6%), BSE Sensex was trading at 72,892.14 (-507.6, -0.7%) while the broader Nifty 500 was trading at 20,410.90 (-67.9, -0.3%),

  • Market breadth is ticking up strongly. Of the 1,804 stocks traded today, 1,168 were gainers and 573 were losers.

Riding High:

Largecap and midcap gainers today include Patanjali Foods Ltd. (1,408.50, 5.1%), CG Power and Industrial Solutions Ltd. (517.65, 4.6%) and Zee Entertainment Enterprises Ltd. (147.70, 4.1%).

Downers:

Largecap and midcap losers today include Infosys Ltd. (1,414.45, -3.7%), MphasiS Ltd. (2,308, -3.6%) and Coforge Ltd. (5,209.90, -3.5%).

Volume Rockets

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

Top high volume gainers on BSE included Amara Raja Energy & Mobility Ltd. (967.95, 10.9%), Aegis Logistics Ltd. (525.95, 7.9%) and Sterling and Wilson Renewable Energy Ltd. (528.80, 6.5%).

Top high volume losers on BSE were Gujarat Gas Ltd. (553.50, -3.4%), Crisil Ltd. (4,680.80, -3.2%) and LTIMindtree Ltd. (4,662.85, -3.2%).

TTK Prestige Ltd. (695, -0.4%) was trading at 12.2 times of weekly average. Ingersoll-Rand (India) Ltd. (3,881.30, 5.6%) and Bharat Dynamics Ltd. (1,846.90, 4.7%) were trading with volumes 5.4 and 5.1 times weekly average respectively on BSE at the time of posting this article.

BSE 500: highs, lows and moving averages

16 stocks took off, crossing 52 week highs, while 3 stocks hit their 52 week lows.

Stocks touching their year highs included - Aegis Logistics Ltd. (525.95, 7.9%), Amara Raja Energy & Mobility Ltd. (967.95, 10.9%) and Indus Towers Ltd. (332.50, -0.6%).

Stocks making new 52 weeks lows included - Bata India Ltd. (1,339, -0.3%) and Hindustan Unilever Ltd. (2,220.80, 1.2%).

11 stocks climbed above their 200 day SMA including Patanjali Foods Ltd. (1,408.50, 5.1%) and Tejas Networks Ltd. (794.20, 3.6%). 16 stocks slipped below their 200 SMA including Coforge Ltd. (5,209.90, -3.5%) and Cholamandalam Investment & Finance Company Ltd. (1,131.50, -2.6%).

 
Trendlyne Marketwatch
Trendlyne Marketwatch
15 Apr 2024
Market closes lower, Brigade Enterprises signs a JDA with Agni Estates & Foundations
By Trendlyne Analysis

Nifty 50 closed at 22,272.50 (-246.9, -1.1%), BSE Sensex closed at 73,399.78 (-845.1, -1.1%) while the broader Nifty 500 closed at 20,478.75 (-266.8, -1.3%). Market breadth is highly negative. Of the 2,097 stocks traded today, 341 were gainers and 1,721 were losers.

Indian indices extended their losses from the afternoon session and closed in the red. The Indian volatility index, Nifty VIX, rose 8.2% and closed at 12.5 points. Aster DM Healthcare closed sharply higher after its board approved a special dividend of Rs 118 per share on account of the sale of the GCC business and the redemption of redeemable preference shares issued to the company by Affinity Holdings.

Nifty Smallcap 100 and Nifty Midcap 100 closed lower, following the benchmark index. Nifty Bank and Nifty Media closed lower than their Friday close. According to Trendlyne’s sector dashboard, Metals & Mining was the worst-performing sector of the day, with a fall of 3.7%.

Major Asian indices closed in the red amid mixed global cues. European indices traded flat or higher, except for the UK’s FTSE 100 trading in the red. US index futures traded in the green, indicating a positive start to the trading session. Brent crude oil futures traded in the red, after closing flat on a volatile day on Thursday.

  • Coromandel International sees a short buildup in its April 25 future series as its open interest rises 9.9% with a put-call ratio of 0.4.

  • IT stocks like Tata Consultancy Services, Infosys, HCL Technologies, Wipro, and LTIMindtree are falling in trade. All constituents of the broader Nifty IT index are also trading in the red.

  • Mahindra & Mahindra to acquire a 26% stake in its drop-down subsidiary Gelos Solren (an arm of Mahindra Susten) for Rs 40.1 crore. Mahindra Susten plans to invest Rs 1,200 crore in developing a 150 MW hybrid renewable energy project combining solar and wind power.

  • BMI, a division of Fitch Solutions, predicts further increases in copper prices in 2024, driven by concerns over Chinese production cuts, rising demand, and the transition to green energy. Despite a 10% rise since the beginning of the year, copper prices declined to $8,558/tonne in April from $9,089/tonne in March.

  • Brigade Enterprises signs a joint development agreement (JDA) with Agni Estates & Foundations to develop Brigade Tech Boulevard, an office space in Chennai. The project will have a leasable area of 8.4 lakh square feet with an expected capex of Rs 400 crore.

  • Adani Green Energy sells 3,066 million units of solar energy in Q4FY24, up 7% YoY. It also sells 614 million units of wind energy, 43% higher than the previous year.

  • Reliance Power is falling as it completes the transfer of its 45 MW wind power project in Maharashtra to JSW Renewable Energy for Rs 132.4 crore.

  • UBS has a 'Buy' rating on Zomato with an upgraded target price of Rs 250. The brokerage highlights the underappreciated growth potential of quick commerce and margins. It expects the company to achieve a margin estimate of 9% and a Gross Merchandise Value (GMV) of $10.2 billion for its quick commerce vertical by FY29.

  • Westlife Foodworld, Can Fin Homes, Nestle India, and Garden Reach Shipbuilders witness a decrease in mutual fund holdings in the past month.

  • Ambuja Cement enters into an agreement with My Home Industries to acquire a 1.5 MTPA grinding unit at Tuticorin, Tamil Nadu, for Rs 413.8 crore.

  • Axis Securities initiates coverage on Man Infraconstruction with a 'Buy' rating and a target price of Rs 270. This indicates a potential upside of 26.9%. The brokerage is positive on the stock on the back of its healthy project pipeline, asset-light business model and strong execution capabilities. It expects the company's net profit to grow at a CAGR of 9.1% over FY23-26.

  • Media stocks like TV18 Broadcast, Network18 Media & Investments, Zee Entertainment Enterprises and PVR INOX are falling in trade. The broader sectoral index, Nifty Media, is also trading in the red.

  • Ramkrishna Forgings is rising as it bags an order worth Rs 270 crore from the BHEL-TRSL consortium for 32 Vande Bharat train sets, comprising 16 coaches each.

  • Aster DM Healthcare surges as its board approves a special dividend of Rs 118 per share on account of the sale of the GCC business and the redemption of redeemable preference shares issued to the company by Affinity Holdings.

  • Jagannarayan Padmanabhan, Sr. Director at CRISIL, expects 8-12% growth in domestic aviation passenger traffic during summer. He notes the pricing discipline among industry players and IndiGo's healthy margins. He adds that airlines may increase fares if crude prices continue to rise.

  • ISMT surges as it wins two orders worth Rs 343.7 crore from ONGC to supply regular casing pipes.

  • Senco Gold surges as it reports revenue growth of 28% YoY in FY24, with a 39% YoY increase in Q4FY24. Despite rising gold prices, the company achieved volume growth of 13% and 19% in gold and diamond, respectively, for FY24.

  • Exide Industries rises sharply as Morgan Stanley reportedly keeps its 'Overweight' rating on the stock with a target price of Rs 485. This indicates a potential upside of 17.2%. The brokerage believes that the company is on track to become the leading player in battery cell tech due to its first-mover advantage.

  • Jefferies initiates coverage on Oil And Natural Gas Corp with a 'Buy' rating and a target price of Rs 390, citing favourable crude and gas reforms and improved profitability. The brokerage also expects the company to generate strong free cash flow and reduce net debt.

  • Dolly Khanna cuts stake in Simran Farms to below 1% in Q4FY24. She held a 1% stake in Q3FY24.

  • Ashish Kacholia sells a 0.2% stake in Safari Industries (India) in Q4FY24. He now holds a 1.9% stake in the company.

  • Ami Organics' board of directors approves raising funds worth Rs 500 crore through a qualified institutional placement (QIP).

  • Tata Consultancy Services' Q4FY24 net profit grows by 12.4% QoQ to Rs 12,434 crore. Its revenue increases by 1.1% QoQ to Rs 61,237 crore on the back of improvements in the banking & financial services, manufacturing and communication, media & technology sectors. The company appears in a screener of stocks with increasing revenue for the past eight quarters.

  • Markets opened on a low note. Nifty 50 was trading at 22,325.20 (-194.2, -0.9%), BSE Sensex was trading at 73,698.06 (-546.8, -0.7%) while the broader Nifty 500 was trading at 20,435.50 (-310, -1.5%).

  • Market breadth is highly negative. Of the 1,921 stocks traded today, 87 showed gains, and 1,805 showed losses.

Riding High:

Largecap and midcap gainers today include Oil And Natural Gas Corporation Ltd. (279.85, 5.3%), Hindalco Industries Ltd. (612.70, 2.4%) and Gujarat Gas Ltd. (572.95, 2.2%).

Downers:

Largecap and midcap losers today include Hindustan Zinc Ltd. (407.25, -5.7%), Max Healthcare Institute Ltd. (833.35, -4.3%) and Mahindra & Mahindra Financial Services Ltd. (290.80, -4.2%).

Volume Shockers

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

Top high volume gainers on BSE included Capri Global Capital Ltd. (245.05, 12.0%), Aster DM Healthcare Ltd. (522.75, 7.1%) and CSB Bank Ltd. (411.15, 6.2%).

Top high volume losers on BSE were GMR Airports Infrastructure Ltd. (80.65, -3.6%) and Welspun Corp Ltd. (558, -1.9%).

Eureka Forbes Ltd. (482.10, 4.2%) was trading at 8.7 times of weekly average. Ramkrishna Forgings Ltd. (706.25, 2.5%) and Oil And Natural Gas Corporation Ltd. (279.85, 5.3%) were trading with volumes 6.4 and 5.1 times weekly average respectively on BSE at the time of posting this article.

BSE 500: highs, lows and moving averages

12 stocks took off, crossing 52 week highs, while 3 stocks tanked below their 52 week lows.

Stocks touching their year highs included - Aegis Logistics Ltd. (487.45, 1.5%), Bharat Electronics Ltd. (234.45, 0.4%) and Indus Towers Ltd. (334.55, 2.0%).

Stocks making new 52 weeks lows included - Dabur India Ltd. (495.20, -1.1%) and Hindustan Unilever Ltd. (2,194.05, -1.7%).

1 stock climbed above their 200 day SMA including Eris Lifesciences Ltd. (850.70, 0.4%). 31 stocks slipped below their 200 SMA including Coforge Ltd. (5396.20, -3.9%) and Ujjivan Small Finance Bank Ltd. (51.75, -3.9%).

 
Trendlyne Marketwatch US
Trendlyne Marketwatch US
12 Apr 2024

Markets are down today morning. Dow Jones was trading at 38459.08 (-2.4, 0.0%) , S&P 500 was trading at 5199.06 (38.4, 0.7%) while the broader US Tech Composite was trading at 16447.20 (271.8, 1.7%)

Riding High:

Largecap and midcap gainers today include Bon Natural Life Ltd (4.06, 866.7%), Rent the Runway Inc - Ordinary Shares - Class A (19.38, 161.9%) and Sonic Foundry, Inc. (0.04, 100%).

Downers:

Largecap and midcap losers today include MiX Telematics Ltd - ADR (0, -100%), PepperLime Health Acquisition Corp - Ordinary Shares - Class A (0, -100%) and Power & Digital Infrastructure Acquisition II Corp - Units (1 Ord Class A & 1/2 War) (0, -100%).

IXIX-CFD: highs, lows and moving averages

11 stocks outperformed, hitting 52 week highs, Stocks touching their year highs included - NRG Energy Inc. (74.59, 1.9%), Constellation Brands Inc - Ordinary Shares - Class A (268.34, 1.3%), Boston Scientific Corp. (68.84, 0.3%) and Alphabet Inc - Ordinary Shares - Class C (160.79, 2.0%).

1 stock climbed above their 200 day SMA including Skyworks Solutions, Inc. (104.33, 1.5%).

1 stock slipped below their 200 SMA including Carmax Inc (71.98, -9.2%).

102 stocks are currently overbought in RSI including Skyworks Solutions, Inc. (104.33, 1.5%).

157 stocks are currently oversold in RSI including Carmax Inc (71.98, -9.2%).

 
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The Baseline
12 Apr 2024
Five Interesting Stocks Today - April 12, 2024

1. Godrej Properties:

This realty company hit its all-time high of Rs 2,791.8 on Tuesday and rose by 11.2% in the past week after it released its Q4 business update. It has risen by 117.5% in the past year, but still underperformed its sector by 18.8% points.

In Q4FY24, the company’s bookings grew 135% YoY to Rs 9,500 crore and sold 5,331 homes. Its bookings grew 84% YoY to over Rs 22,500 crore in FY24 with sales of 14,310 homes on the back of improving project mix as well as strong volume growth. The management said, “This is the highest ever quarterly and annual sales to date by any publicly listed real estate developer in India.” The firm also exceeded its annual bookings guidance of Rs 14,000 crore.  

In the past week, Godrej Properties said that it has sold inventory worth Rs 2,690 crore in its Mumbai project, Godrej Reserve. This project has an estimated revenue potential of approx Rs 7,000 crore. Similarly, the firm also sold homes worth over Rs 3,000 crore within three days of the launch of its project Godrej Zenith in Gurugram. 

Along with its rising bookings, the company’s debt levels are rising as well. Its net debt stands at Rs 6,900 crore. Its debt-to-equity ratio has consistently increased over four consecutive quarters to 0.7 in Q3FY24 from 0.4 in Q4FY23. 

Trendlyne Forecaster estimates a 25% YoY increase in Godrej Properties’ FY24 profit. HDFC Securities maintains its ‘Accumulate’ rating on Godrej Properties on the back of a strong launch pipeline of 18 million square feet over the next 2-3 years. The brokerage estimates a growth of 15% CAGR in net sales over FY24-26. It believes that the firm will add projects on a replacement basis rather than having lumpy transactions. The company appears in a screener for stocks with recommendations or target price upgrades by brokers.

2. IIFL Finance:

This finance company has surged 19.6% in the past week, driven by several positive developments. On April 5, the stock rose 13.2% after its price band limit was revised to 20% from 10%. Additionally, the company received approval from the National Stock Exchange of India (NSE) on April 1 to acquire equity shares worth Rs 284.4 crore in the exchange through a secondary market purchase from FIH Mauritius Investments.

Despite recent gains, Trendlyne’s Technicals indicates that the stock is trading at a discount of 33.7% from its all-time high of Rs 703.4. It fell after the Reserve Bank of India (RBI) imposed restrictions on IIFL Finance on March 4, prohibiting it from sanctioning and disbursing gold loans due to ‘material supervisory concerns’.

This was a significant blow - as of December 31, 2023, gold loans comprised 32% of the total assets under management (AUM) at Rs 24,692 crore for the IIFL Finance Group and 79% of the standalone AUM of IIFL Finance. 

Following the RBI ban, the company, to ensure enough liquidity raised Rs 500 crore through a non-convertible bond issue on March 20, as part of a larger fundraising plan worth Rs 2,000 crore.

Managing Director, Nirmal Jain said that, “The Reserve Bank of India’s (RBI) action on the firm’s gold loan business was attributed to ‘operational issues’ and not governance or ethical problems.” Jain said that the company is implementing corrective measures to reduce discrepancies in the assessment of gold value between branches and audit teams. 

As of February, Trendlyne’s Forecaster showed a consensus recommendation of 'Buy' on the stock with all six analysts rating it a 'Strong Buy'. However, post the ban, the consensus in April shifted to 'Hold,' with three analysts rating it as 'Strong Buy,' one as 'Hold,' and another as 'Sell.'  With an average target price of Rs 581, IIFL Finance has a potential upside of 34.1%.

Motilal Oswal reiterated its 'Buy' rating on March 6, estimating that it could take around six months for the RBI to conduct a special audit and resolve its observations. 

3. Bandhan Bank:

This bank has fallen by 7.3% over the past week, following an announcement that Chandra Sekhar Ghosh will retire as the MD & CEO after his current tenure ends on July 9, 2024. Investors were taken by surprise, since in November 2023 the bank’s board had approved his reappointment for three years, effective July 10, 2024. As a result of the fall in share price, the bank features in a screener of companies with weak momentum.

Ghosh has been serving in this position since July 10, 2015. Now, he is expected to  take up a strategic role at the group level. According to reports, an external candidate is likely to replace him as CEO. 

The retirement comes amid ongoing challenges for the bank, including Covid-related stress in asset quality and a slower recovery than its peers. In addition, Bandhan Bank is currently undergoing a forensic audit by the National Credit Guarantee Trustee Company (NCGTC) for loans worth Rs 23,000 crore (constituting roughly 18% of the total loan book as of Q3FY24), with conclusions expected in 1-2 months.  

Meanwhile, in Q4FY24, Bandhan Bank’s deposits have grown by 25.1% YoY to Rs 1.4 lakh crore, while its advances rose by 17.8% YoY.  Trendlyne’s Forecaster estimates the bank’s net profit to grow by 27.5% YoY in Q4FY24. However, analysts are concerned about the uncertainty around management succession and the potential challenges in terms of growth strategy for the bank. The new CEO's transition would take at least six months. 

According to Nomura, “With leadership now in flux, we see more uncertainties for the franchise”. It has downgraded its rating on the bank to ‘Reduce’ and slashed the target price to Rs 175.

4. Mazagon Dock Shipbuilders:

This defence stock rose 4% on Monday after it reported a year-on-year annual revenue growth of 20% to almost Rs. 9,400 crore for FY24 (this is an unaudited figure). The stock has gained over 222% in share price over one year.

China in the news tends to be good for defence companies like Mazagon Dock Shipbuilders. The rising naval threat from China in the Indian Ocean, especially around Sri Lanka and the Maldives, and its sales of submarines to Pakistan and Bangladesh, have drawn the Indian government’s attention.

Consequently, the Indian defence industry has seen a big boost in government orders over the past year, and has risen 141% overall. The industry is likely to remain bullish in the coming quarters –  the government is considering spending $130 billion over the next six years for fleet modernisation across its armed services. The sector received over $70 billion in the interim budget for 2024-25.

A substantial amount of India’s spending in this sector is likely to be allocated to submarine and ship manufacturers like Mazagon Dock, as India looks to aggressively boost its naval capabilities. The Indian navy currently has about 140 ships, which is expected to expand to 170-175 ships by 2035. Mazagon Dock has the only shipyard in the country that has built naval destroyers and conventional submarines for the Indian Navy. Its order book is currently 5x its revenue, and Nirmal Bang expects a revenue CAGR of 25% over FY24-26E.

The company is however, not exactly a value buy at this point. It is trading at relatively high PE compared to historical trends, and has traded below its current PE 80% of the time. Trendlyne’s Forecaster share price target is relatively bearish on Mazagon Dock due to the run up in its share price over the past year. The consensus is Hold, with a target price of Rs. 1857, a downside of 16.7%. 

5. Exide Industries:

This auto parts & equipment manufacturer touched a new 52-week high today of Rs 403. Exide Energy Solutions, its wholly owned subsidiary, signed an MOU with Hyundai Motors and Kia, where they plan to collaborate on battery cell development and supply for Hyundai’s Indian EVs. The company also recently acquired a 26% equity stake in “Clean Max Arcadia”, a Special Purpose Vehicle (SPV)  incorporated by Clean Max Enviro Energy Solutions, a renewable energy firm based out of Mumbai, to promote renewable energy on a long term basis.

Trendlyne’s Forecaster estimates the company's net profit to grow by 40.2% to Rs 291.3 crore in Q4FY24 while revenue is expected to improve by 15.6% YoY. The firm however missed estimates for Q3FY24 for net profit by 9.4% and revenue by 2.7% due to higher raw material prices during the quarter.

Factors such as rising demand for personal mobility, a shift in global supply chains and increasing demand for more efficient batteries are acting as long term drivers for the company. Exide is also venturing into manufacturing of Li-On cells in technical collaboration with SVOLT (Chinese collaboration) with a capex outlay of  around Rs 6,000 crore for a 12 GWH capacity. The first phase of 6 GWH is slated to be operational in 2025 with a capex outlay of  around Rs 4,000 crore, and the complete plant in the next 3-4 years.

Subir Chakraborty, MD & CEO, said: “We are optimistic about the future and are witnessing signs of demand pick-up. Our Lithium-ion cell production is on schedule. We plan to regain our pre-Covid  EBITDA margin levels of 13-14% in the next 1-2 years.”

ICICI Direct recommends a ‘Buy’ for Exide with a target price of Rs 400, which it hit today. The brokerage notes that with stable raw material prices (lead at ~US$ 2,100/tonne) and operational efficiencies, margins should inch up to 12.5% by FY26.

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
12 Apr 2024
Market closes lower, CLSA maintains ‘Buy’ rating on PVR Inox
By Trendlyne Analysis

Nifty 50 closed at 22,519.40 (-234.4, -1.0%), BSE Sensex closed at 74,244.90 (-793.3, -1.1%) while the broader Nifty 500 closed at 20,745.50 (-169.7, -0.8%). Of the 2,058 stocks traded today, 648 were on the uptrend, and 1,371 went down.

Indian indices extended their losses from the afternoon session and closed in the red. The Indian volatility index, Nifty VIX, rose 3.8% and closed at 11.5 points. Metropolis Healthcare closed in the green after its core business revenue grew 15% YoY in Q4FY24, driven by volume growth. Its B2C revenue also rose 18% YoY.

Nifty Smallcap 100 and Nifty Midcap 100 closed in the red, taking cues from the benchmark index. Nifty Media and Nifty Energy closed lower than their Wednesday close.  According to Trendlyne’s sector dashboard, Metals & Mining emerged as the top-performing sector of the week, with a rise of 6.6%.

Major Asian indices closed in the red, except for Japan’s Nikkei 225 index closing in the green. However, European indices traded in the green, amid mixed global cues. US indices futures traded flat or lower, indicating a cautious start to the trading session. Brent crude oil futures recovered from their losses at open and traded higher after the likelihood of Iran striking Israel triggered fears of a wider war.

  • Money flow index (MFI) indicates that stocks like Hindustan Zinc, Vedanta, Voltas and Honeywell Automation India are in the overbought zone.

  • Mohnish Pabrai sells a 3.8% stake in Edelweiss Financial Services through the open market. Post-transaction, he holds a 3.2% stake in the company.

  • Happiest Minds Technologies announces a collaboration with Enercon, a wind energy technology company, for wind energy solutions.

  • apan's Mitsubishi UFJ Financial Group is in talks to acquire a stake worth roughly $1.7 billion (equivalent to 20%) in HDFC Bank's arm, HDB Financial Services.

  • According to a poll of economists, India's CPI inflation is expected to drop below 5% in March due to softer food and fuel prices. It is anticipated that food prices will fall to 7.3% annually in March from 7.8% in February. The decrease in the headline CPI inflation rate can also be attributed to the reduction in LPG (cooking gas) prices in March.

  • Inox Wind, Anand Rathi Wealth, and Cochin Shipyard's stock prices increase 685.4%, 637% and 485% respectively over the past three years.

  • HFCL rises as the company, along with its arm HTL, bags an order worth Rs 64.9 crore from a private telecom operator to supply optical fibre cables.

  • Godfrey Phillips India exits its retail business division, operated under the name 24Seven, which accounted for 9.3% of its total revenue in FY23.

  • Goldman Sachs initiates a 'Buy' rating on CreditAccess Grameen with a target price of Rs 1,788. They believe the company's valuation is attractive compared to its peers. The brokerage thinks the company is well-positioned to benefit from the expected AUM growth of 19% over FY24-28E.

  • CLSA maintains its ‘Buy’ rating on PVR Inox with a target price of Rs 2,280. The brokerage notes that average collections for Bollywood and Hollywood films have fallen year-to-date. However, it does not expect structural concerns in the long run and sees improved occupancy levels driven by the content pull of new movies and new screens.

  • Foreign institutional investors sell Rs 2,147.2 crore in Indian equities in the past two weeks, according to Trendlyne's FII dashboard. Meanwhile, domestic institutional investors buy equities worth Rs 8,582.6 crore during the same period.

  • Airlines, mining, aluminium and aluminium products, special consumer services, and copperindustries surge more than 7% over the past week.

  • The Society of Indian Automobile Manufacturers (SIAM) data shows a 12.5% YoY increase in March auto wholesales to 2,38,53,463 units. Two-wheeler wholesales rise 13.3% YoY to 1.8 crore units and passenger car wholesales improve 8.4% YoY.

  • Metropolis Healthcare surges as its core business revenue grows by 15% YoY in Q4FY24, driven by volume growth. Its B2C revenue also rises 18% YoY.

  • Manorama Industries surges after the commissioning of its new fractionation plant with an annual capacity of 25,000 tonnes. The new plant brings the total fractionation capacity to 40,000 tonnes per annum.

  • Phoenix Mills’ gross retail collections rise 27% YoY to Rs 2,743 crore in FY24. Meanwhile, in Q4, gross retail collections grow by 27% YoY to Rs 791 crore.

  • Goldman Sachs initiates a 'Buy' rating on Neuland Laboratories with a target price of Rs 9,100. The brokerage notes growth challenges in FY25 due to a high base. However, it sees multiple catalysts, including the commercialization of a large molecule in FY26-27 and improvement in the biotech funding environment.

  • Sun Pharmaceutical Industries falls as the US FDA puts its Dadra facility under the Official Action Indicated category following an inspection conducted in December 2023.

  • Computer Age Management Services (CAMS) is rising as it receives the RBI’s approval to operate as an online payment aggregator.

  • Bharti Hexacom’s shares debut on the bourses at a 32.5% premium to the issue price of Rs 570. The Rs 4,275 crore IPO has received bids for 29.9 times the total shares on offer.

  • Girish Kousgi, MD & CEO of PNB Housing Finance, foresees an opex-to-AUM ratio of around 95-100 bps and Assets under Management (AUM) growth of 17% in FY25. In addition, he notes that their retail book growth has been in double digits and expects a decrease in the cost of funds by 15-20 bps in the upcoming quarters.

  • Dolly Khanna cuts stake in KCP to below 1% in Q4FY24. She held a 1.1% stake in Q3FY24.

  • Sunil Singhania's Abakkus Fund cuts stake in CMS Info Systems to below 1% in Q4FY24. It held a 1% stake in Q3FY24.

  • Vijay Kedia adds Global Vectra Helicorp to his portfolio in Q4FY24. He buys a 2.9% stake in the company.

  • Vodafone Idea's board approves raising up to Rs 18,000 crore through a follow-up public offer (FPO). The FPO is priced at Rs 10 per share.

Riding High:

Largecap and midcap gainers today include Hindustan Zinc Ltd. (431.95, 7.6%), Sona BLW Precision Forgings Ltd. (680, 4.3%) and Indian Railway Catering & Tourism Corporation Ltd. (1,057.65, 3.4%).

Downers:

Largecap and midcap losers today include PB Fintech Ltd. (1,264.15, -5.1%), Page Industries Ltd. (35,803.55, -4.2%) and Sun Pharmaceutical Industries Ltd. (1,540, -4.0%).

Movers and Shakers

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

Top high volume gainers on BSE included Archean Chemical Industries Ltd. (694.60, 6.3%), Quess Corp Ltd. (611.25, 6.0%) and Sona BLW Precision Forgings Ltd. (680, 4.3%).

Top high volume losers on BSE were La Opala RG Ltd. (325, -6.1%), Sun Pharmaceutical Industries Ltd. (1,540, -4.0%) and HLE Glascoat Ltd. (449.55, -3.2%).

Metropolis Healthcare Ltd. (1841.45, 2.3%) was trading at 12.5 times of weekly average. VST Industries Ltd. (3,695, 2.6%) and SIS Ltd. (451.75, 0.0%) were trading with volumes 12.4 and 10.4 times weekly average respectively on BSE at the time of posting this article.

BSE 500: highs, lows and moving averages

39 stocks made 52-week highs, while 2 stocks hit their 52-week lows.

Stocks touching their year highs included - Aegis Logistics Ltd. (480.25, 3.7%), Bharat Electronics Ltd. (233.50, 2.1%) and Indus Towers Ltd. (328.05, 0.4%).

Stocks making new 52-week lows included - Dabur India Ltd. (500.60, -1.1%) and Hindustan Unilever Ltd. (2,232.30, -1.3%).

9 stocks climbed above their 200 day SMA including CreditAccess Grameen Ltd. (1,471.40, 3.0%) and Crompton Greaves Consumer Electricals Ltd. (298.95, 2.9%). 10 stocks slipped below their 200 SMA including Shoppers Stop Ltd. (729.85, -1.9%) and DCM Shriram Ltd. (956.05, -1.9%).