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Trendlyne Marketwatch
Trendlyne Marketwatch
08 Dec 2023
Market closes higher, Sterlite Technologies claims overdue amount of Rs 254 crore from Aksentt Tech
By Trendlyne Analysis

Nifty 50 closed at 20,969.40 (68.3, 0.3%) , BSE Sensex closed at 69,825.60 (303.9, 0.4%) while the broader Nifty 500 closed at 18,703.50 (-0.4, 0%), of the 1,992 stocks traded today, 759 were on the uptick, and 1,198 were down.

Indian indices recovered from their day lows and closed in the green, with the Nifty 50 closing at 20,969.4 points. The Indian volatility index, Nifty VIX, fell 1.6% and closed at 12.5 points. Mutual Funds' net equity inflow rises 28.4% MoM to Rs 15,536 crore in November, according to data released by the Association of Mutual Funds in India (AMFI). Total AUM stands at Rs 49 lakh crore during the same period.

Nifty Smallcap 100 and Nifty Midcap 100 closed in the red, underperforming the benchmark index. Nifty IT and Nifty Bank closed higher than their Thursday close. According to Trendlyne's sector dashboard, Utilities was the top-performing sector of the week as it rose 20.5%.

Major Asian indices closed flat or higher, except for Japan’s Nikkei 225 index closing in the red. European indices traded in the green, taking cues from Asian indices. US index futures traded flat, indicating a cautious start to the trading session. Brent crude oil futures traded in the green but are set to post weekly losses for a seventh straight week.

  • Money flow index (MFI) indicates that stocks like Adani Total Gas, Adani Green Energy, Bharat Heavy Electricals and Bharat Petroleum Corp are in the overbought zone.

  • KPI Green Energy'ssubsidiary, KPIG Energia, receives an order from Citizen Umbrella Manufacturers to execute solar power projects with a total capacity of 1.7 MW. The projects are scheduled to be completed in FY25 and takes the company's order size to cross 149 MW in the captive power producer (CPP) segment.

  • JSW Steel is rising as its American subsidiary, JSW Steel Ohio, plans to raise $145 million by issuing long-term bonds. The funds are expected to be used for construction and expansion.

  • IT stocks like HCL Technologies, LTIMindtree, Persistent Systems, Infosys and Coforge are rising in trade. All the constituents of the broader sectoral index, Nifty IT, are also trading in the green.

  • Infibeam Avenues rises around 8.7% in trade today. The company ranks high on Trendlyne’s checklist, scoring 69.6%. It also features in a screener of stocks with strong annual EPS growth.

  • HDFC Asset Management is falling as Life Insurance Company of India sells a 2.1% stake (44.7 lakh shares) in the AMC in the open market. This takes LIC's stake in HDFC AMC to 6.9% from 9%.

  • Sterlite Technologies falls despite claiming an overdue amount of Rs 254 crore from Aksentt Tech Services. This claim is based on a master agreement signed between the two companies to deploy optic fibre in 1,960 villages across Maharashtra. The company appears in a screener of stocks with reducing debt.

  • PSU Banks like Indian Overseas Bank, Punjab National Bank, Central Bank of India, Punjab & Sind Bank and Indian Bank are falling in trade. All the constituents of the broader sectoral index, Nifty PSU Bank, are trading in the red.

  • Sanghi Industries hits the upper circuit as Ambuja Cements buys a 2.2% stake in the company on December 5. Ambuja Cements has also risen after the deal.

  • Mutual Funds' net equity inflow rises MoM to Rs 15,536 crore in November, according to data released by the Association of Mutual Funds in India (AMFI). Total AUM stands at Rs 49 lakh crore during the same period.

  • Foreign institutional investors invest Rs 17,215 crore in the equity market over the past week, according to Trendlyne's FII dashboard. However, index options witness the highest outflow of Rs 1.6 lakh crore from foreign investors. Meanwhile, mutual funds invest Rs 5,805.8 crore in the equity market over the same period.

  • ICICI Direct maintains its ‘Buy’ rating on Sansera Engineeringand a target price of Rs 1,100. This implies an upside of 18.6%. The brokerage remains positive about the firm’s prospects due to its robust order book, export order wins, long-tenure clients and execution capabilities. It expects the company’s net profit to grow at a CAGR of 34.6% over FY23-25.

  • Olectra Greentechrises as it bags a Rs 62.8 crore order to supply and maintain 40 buses for Vasai Virar City Municipal Corp in Mumbai. It appears in a screenerof stocks with improving net profit and margins.

  • Reports suggest that 75.8 crore shares (12.6% equity) of GMR Airports, amounting to Rs 4,465 crore, change hands in a large trade.

  • Nifty 50 hits an all-time high of 21,006.1 as the RBI Monetary Policy Committee keeps the repo rate unchanged at 6.5%.

  • SpiceJet is falling despite the Dubai International Financial Centre (DIFC) Court lifting the freezing order previously issued against the airline. This order, dated October 30, was related to certain engines installed on aircraft with the Indian registration mark VT-SLM.

  • UPL rises as it incorporates a subsidiary, Advanta Seeds, for conducting seed and related businesses in Zambia. The company appears in a screener of stocks with improving book value per share.

  • Reports suggest that 2.3 crore shares (8% equity) of Five-Star Business Finance, amounting to Rs 1,704 crore, change hands in a large trade.

  • Container Corp of Indiais rising as it signs a memorandum of understanding (MoU) with NTPC's subsidiary, NTPC Vidyut Vyapar Nigam (NVVM). As per the MoU, NVVM will set up solar projects at CONCOR terminals, while CONCOR will purchase solar power from these projects on a long-term basis.

  • IIFL Securitiesrises to an all-time high of Rs 134.4 as the Securities Appellate Tribunal sets aside a SEBI order prohibiting the broker from onboarding new clients for two years. The company appears in a screenerof stocks with strong momentum.

  • Titagarh Rail Systems is rising as its board of directors approves the issue of equity shares worth Rs 700 crore. The issue will take place through a qualified institutional placement (QIP) with a floor price of Rs 976.1 per share.

  • The RBI keeps the policy repo rate unchanged at 6.5% during the Monetary Policy Committee meeting. It raises the FY24 GDP forecast for India by 50 bps to 7% and projects CPI inflation at 5.4%.

  • Zomato's shares, valued at Rs 1,125 crore, are reportedly sold in a block deal today. Reports also suggest that Softbank is likely the seller as it has been planning to reduce its stake in the company.

  • IRB Infrastructure Developers rises to an all-time high of Rs 40.9 as its monthly toll collection increases by 19.4% YoY to Rs 437 crore. The company appears in a screener of stocks with increasing revenue for the past 4 quarters.

  • Motilal Oswal Mutual Fund buys a 0.5% stake (10 lakh shares) in Tube Investments of India at Rs 3,348.1 per share, amounting to Rs 334.8 crore.

  • Dayside Investment sells a 1.4% stake (nearly 9.2 crore shares) in IDFC First Bank at Rs 86.1 per share, amounting to Rs 790.2 crore.

Riding High:

Largecap and midcap gainers today include Tube Investments of India Ltd. (3,574.20, 4.74%), REC Ltd. (405.45, 2.75%) and HCL Technologies Ltd. (1,364.10, 2.72%).

Downers:

Largecap and midcap losers today include Adani Energy Solutions Ltd. (1,131.50, -5.61%), Adani Power Ltd. (533.80, -5.09%) and Adani Green Energy Ltd. (1,550.30, -4.55%).

Volume Rockets

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

Top high volume gainers on BSE included Alok Industries Ltd. (23.30, 12.83%), GMR Airports Infrastructure Ltd. (68.90, 11.67%) and KIOCL Ltd. (376.35, 10.00%).

Top high volume losers on BSE were Praj Industries Ltd. (545.05, -10.28%), Five-Star Business Finance Ltd. (735.15, -2.83%) and Bayer Cropscience Ltd. (5,425.00, -0.94%).

Elgi Equipments Ltd. (536.40, 3.24%) was trading at 11.2 times of weekly average. Indiabulls Real Estate Ltd. (89.90, 9.57%) and Infibeam Avenues Ltd. (22.05, 9.16%) were trading with volumes 7.3 and 5.4 times weekly average respectively on BSE at the time of posting this article.

BSE 500: highs, lows and moving averages

64 stocks made 52 week highs,

Stocks touching their year highs included - Bharat Electronics Ltd. (158.75, -1.00%), Container Corporation of India Ltd. (843.20, 0.10%) and Coromandel International Ltd. (1,224.75, -1.27%).

7 stocks climbed above their 200 day SMA including Shoppers Stop Ltd. (712.45, 2.39%) and Happiest Minds Technologies Ltd. (882.70, 1.79%). 7 stocks slipped below their 200 SMA including Shree Renuka Sugars Ltd. (44.90, -6.26%) and Adani Wilmar Ltd. (377.90, -4.47%).

 
Trendlyne Marketwatch
Trendlyne Marketwatch
07 Dec 2023
Market closes lower, ICICI Direct maintains its ‘Buy’ rating on IndusInd Bank
By Trendlyne Analysis

Nifty 50 was trading at 20,915.25 (-22.5, -0.1%), BSE Sensex was trading at 69,546.71 (-107.0, -0.2%) while the broader Nifty 500 was trading at 18,709.35 (29.4, 0.2%), of the 1,973 stocks traded today, 1,188 showed gains, and 753 showed losses.

Indian indices extended the losses from the afternoon session and closed in the red, with the Nifty 50 closing at 20,901. The volatility index, Nifty VIX, dropped by 7.8% and closed at 12.7 points. One97 Communications (Paytm) announced plans to scale down its disbursements of unsecured loans under Rs 50,000 in response to the regulatory changes. Loans under Rs 50,000 make up for 50% of its disbursements.

Nifty Smallcap 100 and Nifty Midcap 100 closed in the green, with the benchmark index closing lower. Nifty Consumer Durables and Nifty Energy closed higher than Wednesday’s closing level. According to Trendlyne’s sector dashboard, telecommunication equipment emerged as the top-performing sector of the day, with a rise of over 6.2%.

Most European indices trade in the red, except for Europe’s Euronext 100 and France’s CAC 40 trading higher. US indices futures trade lower, indicating a negative start. German factory orders for October contracted by 3.7% against estimates of 0.2% growth.

  • Relative strength index (RSI) indicates that stocks like Hindustan Aeronautics, Adani Green Energy, Adani Total Gas and Trent are in the overbought zone.

  • NHPC rises 5.7% in trade and touches a new 52-week high today. The company ranks high on Trendlyne’s checklist, scoring 52.2%. It also features in a screener of stocks with prices above short, medium and long-term moving averages.

  • ICICI Prudential Life Insurance Company falls as its new business premium in November rises marginally by 2.1% YoY to Rs 1,290 crore. The company's new business sum assured improves by 32.6% YoY. It appears in a screener of stocks with declining net cash flow.

  • ICICI Direct maintains its ‘Buy’ rating on IndusInd Bank with a target price of Rs 1,800. This indicates an upside of 20%. The brokerage is optimistic due to the bank's ongoing expansion of its branch network, increasing focus on the retail segment, and steady asset quality. It expects the company’s net profit to grow at a CAGR of 18% over FY23-26.

  • PSP Projects is rising as it bags an order worth Rs 101.7 crore from the Gujarat government for the construction of a building in GIFT City. The company is also the lowest bidder for a Rs 409.9 crore project involving the development of the Sabarmati waterfront in Ahmedabad, Gujarat.

  • Utility stocks like Tata Power, NHPC, Reliance Infrastructure and SJVN surge more than 4% in trade today. The broader BSE Utilities index is also trading more than 2% higher.

  • Tata Power surges to an all-time high after JM Financial reportedly upgrades its rating to 'Buy' from 'Hold' and increases its target price by 40% to Rs 350. The brokerage remains positive on the back of Tata Power's focus on renewable energy opportunities, exiting low-value businesses, venturing into brownfield hydrostorage, and expanding its transmission business beyond distribution.

  • Stationery and art materials manufacturing firm DOMS Industries sets the price band for its IPO at Rs 750-790 per share. The issue size is Rs 1,200 crore, with a fresh issue of Rs 350 crore and an offer for sale of Rs 850 crore. The issue opens on December 13.

  • KRChoksey initiates coverage on Varun Beverageswith a ‘Buy’ rating and a target price of Rs 1,273. This implies an upside of 17.9%. The brokerage believes the company is well-placed to benefit from the rise in demand for carbonated drinks in India due to its extensive distribution network, capacity expansion, entry into new territories and new launches. It expects the firm’s net profit to grow at a CAGR of 26.2% over CY22-25.

  • SpiceJetrises 20% to touch its 52-week high of Rs 52.3 per share as the airline schedules a board meeting on Monday. At the meeting, the board will consider raising fresh capital through the issuance of equity shares and convertible securities on a preferential basis.

  • Dixon Technologies, Laxmi Organic Industries, Power Mech Projects, and Yatra Online witness an increase in mutual fund holdings in the past month.

  • Bharti Airtel is falling as 1.8 crore shares (0.8% equity), amounting to Rs 1,856 crore, change hands in a block deal, according to reports. Global private equity firm Warburg Pincus is a likely seller in this transaction.

  • Network18 Media & Investments and TV18 Broadcast plunge over 7% as Network18 Group approves their merger. As per the agreement, TV18 shareholders will receive 100 shares of Network18 for every 172 shares they hold in TV18.

  • One97 Communications (Paytm) is falling as it plans to reduce disbursements of unsecured loans below Rs 50,000 due to regulatory changes. JP Morgan reportedly downgrades the firm to ‘Neutral’ from ‘Overweight’ and reduces the target price to Rs 900 from Rs 1,200. This adjustment of small-ticket unsecured loans will impact the platform's loan generation, as the segment makes up 50% of the total disbursements.

  • 360 One Wam's promoters, Nirmal Jain, Madhu Jain and Venkataraman Rajamani, sell 1.4%, 0.8% and 0.6% stakes in the company, respectively.

  • IDFC First Bank is falling as 13.2 crore shares (around 2% equity), amounting to Rs 1,135 crore, change hands in a block deal, according to reports.

  • Sapphire Foods India's promoter, Arinjaya (Mauritius), sells a 4.2% stake in the company. It now holds 3.8%.

  • Dr. Reddy's Laboratories rises as it partners with Coya Therapeutics to commercialize COYA 302, a treatment for amyotrophic lateral sclerosis (ALS). The company will make an upfront payment of $7.5 million (approx Rs 62.5 crore) to Coya Therapeutics for this.

  • Alok Industries is rising as it signs a facility agreement with State Bank of India for a Rs 1,750 crore loan to repay existing debt. The company will also receive Rs 90 crore for working capital requirements.

  • Macquarie maintains its ‘Outperform’ rating on Hindustan Unilever with a target price of Rs 3,000. The brokerage expects the company’s Q3 demand and volume growth to be similar to Q2FY24 levels. Channel checks suggest that there is no festive season boost in demand trends.

  • Brigade Enterprises enters a joint development agreement to develop a 0.2 million square feet office space in Bengaluru with a gross development value of Rs 500 crore.

  • Ircon International falls sharply amid government plans to sell an 8% stake through an offer for sale at a floor price of Rs 154 per share. The offer will open for non-retail investors on December 7 and for retail investors on December 8. The company appears in a screener of stocks with zero promoter pledges.

  • Delta Corp rises over 4% as its subsidiary, Datatech Gaming, receives interim relief from the Calcutta High Court in a case involving a Rs 6,384.3 crore tax demand. The court has also ordered that any decision made by the Tax Authority on the show cause notice should not be implemented until further notice.

  • Bharat Electronics rises to an all-time high of Rs 161.8 as it bags orders worth Rs 3,915 crore. This includes a Rs 580 crore order from the Indian Army for radars and Rs 3,335 crore in defence orders since September 15. The company appears in a screener of stocks with strong momentum.

Riding High:

Largecap and midcap gainers today include Adani Total Gas Ltd. (1,146.85, 8.88%), Tata Power Company Ltd. (319.70, 8.69%) and Life Insurance Corporation of India (791.30, 6.07%).

Downers:

Largecap and midcap losers today include One97 Communications Ltd. (669.80, -17.62%), Aditya Birla Capital Ltd. (168.20, -2.80%) and Bank of India (113.75, -2.49%).

Crowd Puller Stocks

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

Top high volume gainers on BSE included ITI Ltd. (314.80, 15.97%), KIOCL Ltd. (342.15, 10.00%) and MMTC Ltd. (55.75, 9.96%).

Top high volume losers on BSE were One97 Communications Ltd. (669.80, -17.62%), Praj Industries Ltd. (616.50, -3.66%) and Balrampur Chini Mills Ltd. (421.30, -2.43%).

Finolex Industries Ltd. (213.80, 3.74%) was trading at 6.3 times of weekly average. HFCL Ltd. (70.75, 6.47%) and Tube Investments of India Ltd. (3407.90, 2.21%) were trading with volumes 4.7 and 4.4 times weekly average respectively on BSE at the time of posting this article.

BSE 500: highs, lows and moving averages

51 stocks hit their 52 week highs,

Stocks touching their year highs included - Apollo Tyres Ltd. (464.30, 0.40%), Bajaj Finserv Ltd. (1,706.95, 0.39%) and Bajaj Holdings & Investment Ltd. (8,143.55, 3.36%).

11 stocks climbed above their 200 day SMA including HFCL Ltd. (70.75, 6.47%) and Devyani International Ltd. (187.20, 1.68%). 7 stocks slipped below their 200 SMA including One97 Communications Ltd. (669.80, -17.62%) and Aditya Birla Capital Ltd. (168.20, -2.80%).

 
Trendlyne Marketwatch
Trendlyne Marketwatch
07 Dec 2023

Nifty 50 closed at 20901.15 (-36.6, -0.2%) , BSE Sensex closed at 69521.69 (-132.0, -0.2%) while the broader Nifty 500 closed at 18703.85 (23.9, 0.1%)

Market breadth is in the green. Of the 1987 stocks traded today, 1098 were gainers and 856 were losers.

Riding High:

Largecap and midcap gainers today include Tata Power Company Ltd. (325.80, 10.76%), Adani Total Gas Ltd. (1158.60, 10.00%) and NHPC Ltd. (64.25, 6.73%).

Downers:

Largecap and midcap losers today include One97 Communications Ltd. (661.35, -18.66%), Aditya Birla Capital Ltd. (166.60, -3.73%) and IDFC First Bank Ltd. (87.70, -2.99%).

Volume Rockets

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

Top high volume gainers on BSE included Tata Power Company Ltd. (325.80, 10.76%), ITI Ltd. (300.10, 10.55%) and KIOCL Ltd. (342.15, 10.00%).

Top high volume losers on BSE were One97 Communications Ltd. (661.35, -18.66%), Ircon International Ltd. (160.75, -6.51%) and Balrampur Chini Mills Ltd. (408.60, -5.37%).

Finolex Industries Ltd. (214.45, 4.05%) was trading at 7.7 times of weekly average. HFCL Ltd. (70.35, 5.87%) and MMTC Ltd. (55.75, 9.96%) were trading with volumes 5.9 and 5.8 times weekly average respectively on BSE at the time of posting this article.

BSE 500: highs, lows and moving averages

66 stocks took off, crossing 52 week highs,

Stocks touching their year highs included - Apollo Tyres Ltd. (455.15, -1.58%), Bajaj Finserv Ltd. (1704.05, 0.22%) and Bajaj Holdings & Investment Ltd. (8080.40, 2.56%).

12 stocks climbed above their 200 day SMA including HFCL Ltd. (70.35, 5.87%) and Redington Ltd. (168.70, 2.12%). 8 stocks slipped below their 200 SMA including One97 Communications Ltd. (661.35, -18.66%) and Balrampur Chini Mills Ltd. (408.60, -5.37%).

 
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The Baseline
07 Dec 2023
India’s electronics Industry set for eye-popping growth | Screener: Manufacturers benefiting from PLI schemes
By Shreesh Biradar

As electronics manufacturers like Foxconn move their factories to India, they are running into some cultural differences. 'We are taught not to mention religion or politics, and to say please,' one Chinese engineer training Indian workers says, 'Chinese people talk in a blunt way. But with Indians, we should be more polite.'

The Foxconn engineers also complain that Indians take too many holidays and are late to meetings. But that's not stopping companies from investing.

The winds of manufacturing, which have long blown east towards China, are changing direction. As China grows more assertive - some would say argumentative - under Xi Jinping, US and Europe are scrambling to curb its growth through sanctions. These sanctions have already had the effect of slowing down China’s annual exports of electrical and electronic equipment, valued at $955 billion.

Enter India. With China losing favour, countries like India, South Korea and Vietnam are receiving new investments in semiconductors, electronics and technology.

Recent data shows China’s FDI turning negative in Q3 2023 for the first time since 1998, with more money flowing out than coming in. This shift is evident in the latest iPhones coming with a “Made in India” tag rather than “Made in China”.

While other manufacturing centers like South Korea are more advanced in electronic and electrical manufacturing, India lags due to technological and infrastructural hurdles. The Indian government has implemented the National Electronic Policy (NEP) and production-linked incentive schemes to fix this. 

India’s electronic system design and manufacturing  (ESDM) industry is expected to grow at a remarkable 32% CAGR over the next five years, driven by increased per capita spending, higher rural penetration of electronics, shift to electric vehicles and increased use of electronics in the medical field.  

In this week’s Analyticks:

  • India’s Electronics Industry: Preparing for a major growth leap
  • Screener: Electric and Electronic companies that are benefiting from PLI schemes

Let’s get into it.

India’s electronics industry is on the cusp of dramatic growth

As India’s rural population adopts technology, growth in the electronic industry is expected to be exponential. 37.2% of India's new smartphone purchases in Q1 2023 were by rural families. As electronics buying rises across consumer groups,  India’s electronics industry is expected to far outpace its global peers.  

And let's not forget the talking fridge. Modern versions of refrigerators and washing machines are changing from mechanical devices to ‘smart’ machines, equipped with sensors and user memory. India’s huge population is a rising consumer base for these. 

India’s electronics industry is set to grow at 18% CAGR for the next five years. However, if we look at the overall ESDM sector (including outsourcing and exports), the expected growth rate is at an even higher 32.5%. 

India’s ESDM industry poised for a CAGR of 32.5% by FY27

Valued at $34 billion in 2023, India’s ESDM industry is expected to reach $80 billion by 2026, with most of the growth coming from auto (29.4% CAGR), aerospace and defense (38.3%), and the medical field (40.3%). Auto industry growth will be driven by new sensor and technology-based features. For example, an electric two-wheeler has 9X more electrical components than a regular internal combustion engine (ICE) two-wheeler.

But compared to its global peers, India’s electronic consumption is still low. India’s per capita electronic consumption is $78 per annum, while the global average stands at $324 per annum. 

India has the lowest per capita consumption of electronics

India has never been a manufacturing powerhouse. Can that finally change?

India is being celebrated as the 'next big hub' for electronic manufacturing. But if we look at India’s GDP, only 17.7% comes from the manufacturing sector, while China’s is nearly 27.7% as of 2022.

India’s low manufacturing growth has always been a problem. The lack of skilled labour, high product costs (raw materials, land costs, taxes), bureaucratic hurdles, local politics, and labour unions make it difficult for foreign firms to invest in India.

The government is battling these problems with PLI schemes, special economic zones, and relaxation of FDI criteria. Nearly 98% of mobile phones shipped locally are now being manufactured in India.

The government has also provided incentives to high-end mobile phone manufacturers to boost local production. For instance, it provided tax breaks to Foxconn to set up Apple’s manufacturing unit in India, and Karnataka revised the permitted number of working hours from eight to twelve. 


Mobile phone production drives Indian electronics industry

India is also looking at custom policies to attract specific investors. Elon Musk's Tesla is in talks with the government to invest $2 billion in India, provided the government drops the import tax on Tesla vehicles from 70% (for cars priced below $40,000) to 15% for the first few years. 

No startups here: Opportunity is mainly for Indian players with deep pockets 

The electronic industry in India has so far, been limited to manufacturing low-end devices. Some Indian manufacturers are collaborating with foreign companies to implement high-tech manufacturing As Indian companies build tech expertise and foreign market access, the Indian electronic industry, is expected to turn export-positive in FY25.

The Indian electronics industry is set to become a net exporter by FY25

Indian companies have been buying foreign-owned manufacturing units or developing partnerships to boost their production capabilities. For instance, Tata Electronics has taken over Wistron’s (Taiwan-based Apple iPhone manufacturer in India) manufacturing facilities to gain access to Apple’s technology. 

Dixon Technologies has partnered with China’s Xiaomi and  Reliance Jio to manufacture smartphones, while Kaynes Technologies has partnered with Intel to produce laptops. The trend suggests that global electronics majors are partnering with established Indian manufacturers.

Large manufacturers who have the ability to quickly upscale are the winners in India's current electronics manufacturing boom. This route takes many risks out of the equation for global manufacturers. But the real success for India will come with better infrastructure and easier rules for everyone, so that new entrants and smaller players are able to ride the wave and compete.  

Screener: Electric and electronic companies benefiting from government PLI schemes

Blue Star leads in quarter change among stocks benefitting from PLI schemes

Keeping with the manufacturing theme, this week we have a screenerthat shows Indian-listed companies from the IT hardware, consumer electronics, heavy electrical equipment, other electrical equipment and electric utilities industries that are benefiting from the Indian government’s PLI schemes. Production Linked Incentive schemes provide incentives to companies as a percentage of their net incremental sales from the base year.

Major stocks from these industries that appear in the screener are Blue Star, Bharat Heavy Electricals, Kaynes Technologies, JSW Energy, Dixon Technologies, PG Electroplast.

Blue Star has risen by 37.9% over the past quarter and 42.2% over six months since the announcement of the government's PLI Scheme 2.0 for the IT hardware and electronics industries. Under this scheme, the government has given an incentive of Rs 16,939 crore for the next six years. 

Dixon Technologies is another consumer electronics company that has risen by 17.7% over the past quarter post the announcement of the scheme. The company was declared eligible under the PLI scheme after it promisedon November 19 a total production value of Rs 45,000 crore over the next six years. 

You can find more popular screenershere.

 
Trendlyne Marketwatch
Trendlyne Marketwatch
06 Dec 2023
Market closes higher, HDFC Sec initiates coverage of Happiest Minds with an ‘Add’ rating
By Trendlyne Analysis

Nifty 50 closed at 20,937.70 (82.6, 0.4%) , BSE Sensex closed at 69,653.73 (357.6, 0.5%) while the broader Nifty 500 closed at 18,680.00 (91.5, 0.5%), of the 1,998 stocks traded today, 965 were on the uptick, and 994 were down.

Indian indices recovered from their day lows and closed in the green, with the Nifty 50 closing at 20,937.7 points. The Indian volatility index, Nifty VIX, rose 2.1% and closed at 13.7 points. HCL Technologies closed higher after it extended its strategic partnership with Sweden's Husqvarna Group.

Nifty Smallcap 100 and Nifty Midcap 100 closed in the green, taking cues from the benchmark index. Nifty Media and Nifty IT closed higher than their Tuesday close. According to Trendlyne's sector dashboard, Fertilizers was the top-performing sector of the day as it rose 6.4%.

Major Asian indices closed higher, except for China’s Shanghai SE Composite Index closing flat. European indices traded in the green amid positive global cues. Brent crude oil futures traded in the red for a fifth straight trading session. US index futures traded in the green, indicating a positive start to the trading session.

  • Birlasoft sees a long buildup in its December 28 future series as its open interest rises 25.4% with a put-call ratio of 0.6.

  • HDFC Securities initiates coverage of Happiest Minds Technologies with an ‘Add’ rating and a target price of Rs 935, implying an upside of 11.2%. The brokerage believes the firm’s long-term prospects are healthy, given its potential for scalability, quality execution, and growing customer base. It expects revenue to grow at a CAGR of 21% over FY24-26.

  • Hindustan Aeronautics rises over 5% to touch its all-time high of Rs 2,754.1 per share ahead of the HAL Avionics Expo-2023. The company plans to launch a range of in-house manufactured avionics products.

  • Ashu Shinghal, Managing Director of Mahanagar Gas, reports a 4% volume growth in Q3 so far and targets 6-7% in FY24. He adds that the acquisition of Unison Enviro is expected to receive regulatory approvals in a month.

  • Zydus Lifesciences rises as it receives final US FDA approval for its Methylene Blue Injections. The drug is used to treat adults and children with acquired Methemoglobinemia and has a market of $73.4 million in the USA. The company appears in a screener of stocks nearing 52-week high.

  • Malabar India Fund sells a 2.2% stake in Prataap Snacks in the open market. It now holds a 3.4% stake in the company.

  • Indraprastha Gas sees three analyst target price downgrades and one recommendation downgrade in the past month. Relaxo Footwears, CCL Products India and Ashok Leyland see two analyst target price downgrades over the same period.

  • According to Barclays, India’s CPI Inflation is likely to rise above 6% in November from around 4.9% in October. The brokerage believes higher food inflation, driven by rising vegetable prices (mainly onions and tomatoes), may pressure the headline inflation rate.

  • Bank stocks like Au Small Finance Bank, ICICI Bank, Federal Bankand IndusInd Bankare falling in trade. Barring HDFC Bank, all constituents of the broader BSE Bankindex are also trading in the red.

  • HCL Technologiesis rising as it extends its strategic partnership with Sweden's Husqvarna Group. As per the partnership, the company will provide its AI, digital, engineering and support services to Husqvarna Group.

  • Sterling and Wilson Renewable Energyis rising as reports suggest that it may launch a qualified institutional placement (QIP) of equity shares worth Rs 1,500 crore next week.

  • Vivek Gupta, MD and CEO of United Breweries, says the beer segment is expected to grow in the mid-high single digits in India. He adds that the company’s overall market share is at 45-46%, while the premium segment stands at 20%. He highlights that volume growth has been 7% YoY in Q2, but it targets to surpass the market.

  • Oberoi Realty signs an MoU with NRB Bearings to acquire 6.4 acres of land worth Rs 196 crore in Thane, Maharashtra.

  • KRChoksey upgrades its rating on Bajaj Auto to ‘Buy’ from ‘Add’ and raises its target price to Rs 7,093 from Rs 5,830. This implies an upside of 17.7%. The brokerage believes the company’s focus on the domestic 125-plus segment will lead to market share gains. It also sees continued demand growth for commercial vehicles, led by increasing penetration of EVs and compressed natural gas vehicles.

  • IT stocks like Wipro, L&T Technology Services, MphasiS and Tata Consultancy Services are rising in trade. All constituents of the broader Nifty IT index are also trading in the green.

  • Angel One rises to an all-time high of Rs 3,245 as its client base grows by 51.3% YoY to 1.8 crore in November 2023. The broker's total number of orders increased by 51.4% YoY in the same month. The company appears in a screener of stocks with strong momentum.

  • Retail sales for the automotive industry touches a record high, up 18.5% YoY to 28.5 lakh units in November, shows data from the Federation of Automotive Dealers' Association. Two-wheeler retail sales increase 21.1% YoY, while cars rise by 17.2% YoY.

  • Power Grid Corp of India is rising after winning the bid to set up the inter-state transmission system in Khavda RE Park, Gujarat, on a build, own, operate and transfer (BOOT) basis. The company will establish a new 765 to 400kV switching station and three 765kV D/c transmission lines.

  • Somany Ceramics rises as it sets December 15 as the record date for its Rs 125 crore share buyback. The buyback will involve 14.7 lakh shares (a 15.2% stake) at an average price of Rs 850 per share. It appears in a screener of stocks with zero promoter pledge.

  • Media stocks like TV18 Broadcast, Dish TV India, Network18 Media & Investments, Zee Entertainment Enterprises and Hathway Cable & Datacom are rising in trade. Barring Nazara Technologies, all the constituents of the broader sectoral index, Nifty Media, are trading in the green.

  • CLSA downgrades its rating on Eicher Motors and Bajaj Auto to ‘Underperform’, and Hero MotoCorp to ‘Outperform’. It also maintains its ‘Sell’ rating on TVS Motor. The brokerage cites the recent significant rise in stock prices and a recovery in volume growth in the two-wheeler segment as reasons for these adjustments.

  • Jindal Drilling and Industries rises to an all-time high of Rs 915 as it receives a three-year rig contract from Oil and Natural Gas Corp, valued at $86,327 per day. The company appears in a screener of stocks with increasing quarterly profits.

  • Bank of India is rising as it launches its qualified institutional placement (QIP) issue at a floor price of Rs 105.4 per share. The bank plans to raise Rs 4,500 through this QIP issue. The stock shows up in a screener for companies with high TTM EPS growth.

  • Dalmia Bharat appoints Puneet Yadu Dalmia as Managing Director and Chief Executive Officer, with effect from December 8, 2023.

  • State Bank of India plans to acquire an additional 20% stake in SBI Pension Funds for a consideration of Rs 229.5 crore. Through this acquisition, the bank aims to increase its stake in the pension fund to 80% from 60%. The transaction is expected to be completed by December 15.

Riding High:

Largecap and midcap gainers today include Adani Total Gas Ltd. (1,053.30, 19.99%), Adani Green Energy Ltd. (1,563.45, 15.94%) and Adani Energy Solutions Ltd. (1,164.30, 7.37%).

Downers:

Largecap and midcap losers today include General Insurance Corporation of India (293.90, -4.25%), CG Power and Industrial Solutions Ltd. (453.75, -4.12%) and Max Healthcare Institute Ltd. (656.30, -3.92%).

Volume Rockets

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

Top high volume gainers on BSE included Rashtriya Chemicals & Fertilizers Ltd. (152.90, 12.63%), Balaji Amines Ltd. (2,307.60, 12.19%) and Adani Energy Solutions Ltd. (1,164.30, 7.37%).

Top high volume losers on BSE were Balrampur Chini Mills Ltd. (431.80, -7.32%), Can Fin Homes Ltd. (788.75, -5.75%) and Global Health Ltd. (974.85, -2.86%).

Alkyl Amines Chemicals Ltd. (2,297.35, 5.59%) was trading at 10.6 times of weekly average. Pfizer Ltd. (4,040.05, 0.20%) and Privi Speciality Chemicals Ltd. (1,311.50, 3.68%) were trading with volumes 8.4 and 7.3 times weekly average respectively on BSE at the time of posting this article.

BSE 500: highs, lows and moving averages

74 stocks took off, crossing 52 week highs, while 1 stock were underachiever and hit their 52 week lows.

Stocks touching their year highs included - Adani Ports & Special Economic Zone Ltd. (1,017.95, 0.48%), Adani Power Ltd. (560.45, 4.14%) and Ajanta Pharma Ltd. (1,946.65, -1.03%).

Stock making new 52 weeks lows included - Vinati Organics Ltd. (1,693.15, -0.51%).

9 stocks climbed above their 200 day SMA including Balaji Amines Ltd. (2,307.60, 12.19%) and G R Infraprojects Ltd. (1,214.40, 7.75%). 5 stocks slipped below their 200 SMA including Delhivery Ltd. (382.95, -2.68%) and Biocon Ltd. (240.40, -1.11%).

 
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The Baseline
06 Dec 2023
By Akshat Singh

Capital expenditures (capex) are vital for a company's growth and competitiveness as this spending is an investment into the future of the business, and a bet on upcoming growth. The capex growth forecasts tell us which companies are making the biggest bets on expansion and growth. Higher forecasts suggest aggressive growth strategies and financial health, and indicate the company's commitment to long-term development and market leadership. 

In this edition of Chart of the Week, we look at a screener of companies with high forecasted capex growth. The bubble chart circles represent the size of capex growth estimates. We look at the individual sectors poised for high capex growth in the coming year, and identify the biggest contributors. 

General industrial stocks lead in capex growth estimates, thanks to expansion plans

Hitachi Energy, Timken India, and Jindal Saw have the highest capex growth estimates in the general industrials sector in FY24

Seven of the 25 stocks in our chart belong to the general industrial sector. Hitachi Energy India leads with an estimated capex growth of 735.4% for FY24, thanks to plans to add 45 new data centres in three years to meet India’s booming market. These data centres are outsourced by companies to store, manage, and process extensive amounts of data and computing systems. Hitachi Energy’s solutions align perfectly with data centre needs. Projections indicate a sixfold increase in sector capacity over the next six years, driven by substantial investments (capex) of Rs 1.05 to 1.20 lakh crore. 

Moving on, Timken India has an estimated capex growth of 527.3% for FY24. Its diverse presence across capex-sensitive sectors like consumer durables, automobiles and chemicals sets a strong foundation for its future. The company plans to spend Rs 600 crore on a new roller bearings plant. Monarch Networth Capital anticipates Timken's significant capex to challenge competitors, leading to robust growth in railways, heavy mobility, and exports.

Another major player, Jindal Saw, is estimated to grow its capex by 462.8% in FY24. Close behind are RHI Magnesita and Praj Industries with capex growth of 284% and 283%, respectively. Praj Industries plans a total capex of Rs 120 crore in FY24, with Rs 100 crore set aside for Praj GenX in the Energy Transition & Climate Action (ETCA) sector. This funding aims to support advanced solutions for low-carbon fuel projects like Blue and Green Hydrogen/ammonia. Commercial production is expected to start from Q4FY24. Finally, we have CG Power and Industrial Solutions with an estimated capex growth of 222.5% in the coming year. 

Four IT sector firms projected to have high capex growth in FY24

In the software & services sector, Mphasis leads with an estimated capex growth of 567% in FY24. The acquisition of Silverline for Rs 1,100.7 crore will enhance its salesforce capabilities. Zensar Technologies follows with an 182.6% growth, and Cyient and Firstsource Solutions are estimated at 167% and 165.4% in FY24, respectively. 

Consumer durables and automotive stocks have greenfield projects scheduled

Three consumer durable firms have high capex spends planned in FY24

In the consumer durables sector, Finolex Cables stands out with the highest estimated capex growth of 736.2% in FY24. This is also the highest forecast in the Nifty 500. The company plans to invest Rs 400 crore over the next 12-18 months to expand capacities in communication, solar, automotive, and construction cables. It aims to increase optic fibre capacity from 8 to 10 million fibre km and double fibre draw capacity to 8 million km. 

Kaynes Technology India comes next with an estimated capex growth of 304.3%, while KEI Industries is projected to grow its capex by 298.7% in FY24. 

In the automobiles & auto components sector, Asahi India Glass is estimated to see a capex growth of 389.9% during FY24. Its Rs 1,400 crore capex will be mainly for maintenance and funding of a major greenfield project. An additional Rs 1,000 crore is planned for FY25, covering remaining expenses for the greenfield factory and expanding the automotive segment's capacity. Samvardhana Motherson International also has an estimated capex growth of 213.2% in FY24. 

Chemical and pharma stocks set high capex growth estimates

PI Industries from the chemicals sector has the highest estimated capex growth of 324% for FY24. In H1FY24, the company spent Rs 763 crore on capex, including a Rs 497 crore investment in Pharma assets. It aims for an overall capex of Rs 800 crore, including a Rs 300 crore spillover from FY23. This is to enhance capacity utilization and improve throughput. The company has also planned Rs 80-100 crore annually to upgrade its pharma facilities and improve technological capabilities. Deepak Nitrite follows with an estimated capex growth of 176.5% during the same period.

In the pharmaceutical sector, Gland Pharma tops with an estimate of 350.6% in capex growth, followed by Ipca Laboratories, which is expected to spend 165.6% more. Next, diversified consumer services have Cera Sanitaryware leading with 218.1%. The company increased its brownfield faucetware capacity from 3 to 4 lakh pieces per month, starting in September 2023. It has also finalized land acquisition in Gujarat for a new sanitaryware plant. A maintenance capex of Rs 35 crore is planned for FY24, with Rs 7 crore already spent. Max Healthcare Institute is projected to see a 207.3% capex growth in the current financial year.

Other notable stocks in our list are AMCNippon Life India Asset Management (347%), fertilizers major Chambal Fertilisers and Chemicals (278.4%) and FMCG player Emami (239.8%). 

Lastly, Century Plyboards is estimated to achieve a capex growth of 260.6% for FY24, with a planned capex of Rs 450 crore in FY25 for expansions. This includes a particle board expansion in Chennai to 2,40,000 cubic metres by the end of FY25 (capex Rs 550 crore). These strategic investments aim to strengthen Century's production capacities across particle board, plywood, laminates and fibre board segments.

 
Trendlyne Marketwatch
Trendlyne Marketwatch
05 Dec 2023
Market closes higher, Adani Green Energy completes a $1.4 billion follow-on funding
By Trendlyne Analysis

Nifty 50closed at 20,855.10 (168.3, 0.8%), BSE Sensexclosed at 69,296.14 (431.0, 0.6%) while the broader Nifty 500closed at 18,588.55 (140.1, 0.8%). Market breadth is in the red. Of the 1,991 stocks traded today, 868 were on the uptrend, and 1,085 went down.

Indian indices extended the gains from the afternoon session and closed in the green, with the Nifty 50closing at an all-time high of 20,855. The volatility index, Nifty VIX, rose by 3.6% and closed at 13.5 points. Ambuja Cements acquired a 54.5% stake in Sanghi Industries for Rs 1,700 crore. The company will acquire the remaining 2.2% stake from the promoters of Sanghi Industries at the same valuation.

Nifty Smallcap 100 closed flat, while Nifty Midcap 100 closed higher following the benchmark index. Nifty Metal and Nifty Energy closed higher than Monday’s closing level. According to Trendlyne’s sector dashboard, commercial services & supplies emerged as the top-performing sector of the day, with a rise of over 9.8%. 

Most European indices trade in the green except for England’s FTSE 100 trading in the red. US indices futures trade lower indicating a negative start. The data released by Hamburg Commercial Bank indicated that the Eurozone’s composite PMI for November declined to 47.6 against estimates of contraction to 47.1

  • Money flow index (MFI) indicates that stocks like Trent, Anupam Rasayan India, Hindustan Aeronautics and Bharat Petroleum Corp are in the overbought zone.

  • Utilities, commercial services & supplies and transportation sectors rise by more than 17.5% over the past month.

  • Rallis India surges over 9%, reaching 37% above its 52-week low. It has a high Trendlyne durability score of 70. However, it is trading in the 'Sell' zone. It appears in a screener of stocks with rising net cash flow and cash from operating activities.

  • According to Morgan Stanley, the RBI’s monetary policy committee (MPC) will keep interest rates unchanged in FY24, with a rate cut cycle expected to start from June 2024. It also foresees an upward revision of India’s FY24 GDP growth forecast from 6.5%, as the Q2 GDP surpassed estimates.

  • Galaxy Surfactants, Oil India, Supreme Industries, Poly Medicure and Granules India outperform their industries in terms of annual growth and capital returns.

  • Ambuja Cements is rising as it acquires 14 crore shares (54.5% stake) in Sanghi Industries at Rs 121.9 per share. It has revised the open offer price to Rs 121.9 from Rs 114.2 and plans to acquire the remaining 2.2% stake from the promoters of Sanghi Industries at the same price. This follows its August 3 announcement of acquiring a 56.7% stake in Sanghi Industries.

  • Brigade Enterprises rises as it plans to develop a luxury residential project in 4 acres for a gross development value of Rs 300 crore in Kurubarahalli, Mysore. The company appears in a screener of stocks with strong annual EPS growth.

  • Elara Capital reiterates its ‘Accumulate’ rating on Varun Beverages with an upgraded target price of Rs 1,180. The brokerage highlights key growth drivers like Gatorade production in the CSD (carbonated soft drink) setup, flexible production lines, and international expansion.

  • Energy stocks like Adani Energy Solutions, Adani Green Energy, Bharat Petroleum Cropand Indian Oil Corpare rising in trade. The broader Nifty Energyis also trading 2.4% up, helping it to touch its all-time high of Rs 31,156.4.

  • Adani Green Energyrises over 15% as it completes a $1.4 billion (approx. Rs 11,340 crore) follow-on funding through an international bank consortium. This funding is part of a $3 billion construction financing framework for building its renewable energy park in Gujarat.

  • Thomas Cook (India)'s promoter, Fairbridge Capital (Mauritius), sells an 8.5% stake in the company. It now holds a 63.8% stake.

  • According to S&P Global Ratings, India is poised to become the world’s third-largest economy by 2030. It also expects GDP growth to be around 7% in FY27.

  • BoB Capital Markets maintains its 'Buy' rating on Polycab Indiawith a target price of Rs 6,100. This implies an upside of 15.3%. The brokerage's optimism is based on the company's strong position in the wires & cables sector and swift growth in the fast-moving electronic goods and B2C segments. It expects the firm’s net profit to grow at a CAGR of 21.9% over FY23-25.

  • IT stocks like Coforge, L&T Technology Services, Persistent Systems, HCL Technologies and LTIMindtree are falling in trade. All the constituents of the broader sectoral index, Nifty IT, are trading in the red.

  • Indian Energy Exchange is falling despite its November volumes rising by 17.5% YoY to 9,136 million units and total electricity volume increasing by 13% YoY. The company shows up in a screener for stocks with high Trendlyne Momentum scores.

  • India’s Services PMI declines to 56.9 in November from 58.4 in October. However, the PMI readings have remained above 50 for 28 consecutive months, indicating an expansion in activity.

  • Utilities stocks like Adani Green Energy, Adani Energy Solutions, Inox Green Energy Services and Adani Power surge more than 6% in trade. The broader BSE Utilities index is also trading over 3% higher.

  • Mahindra & Mahindra Financial Services' total disbursements grow by 16% YoY to Rs 5,300 crore in November, boosting its business assets by 17% YoY. However, the NBFC's collection efficiency has fallen by 200 bps YoY to 94%.

  • Gulshan Polyols surges more than 4% as it bags an order worth Rs 571.5 crore to supply 89,404 kilo litres of ethanol to Bharat Petroleum Corp, Indian Oil Corp and Hindustan Petroleum Corp.

  • Reports suggest that 1.8 crore shares (10.9% equity) of Shriram Properties, amounting to Rs 214 crore, change hands in a large trade.

  • Great Terrain Investment sells a 19.9% stake in Computer Age Management Services for approx Rs 2,700 crore in a bulk deal on Monday.

  • JSW Infrastructurerises as its subsidiary, JSW Dharamtar Port, enters into a share purchase agreement to acquire a 50% stake in PNP Maritime Services for Rs 270 crore. The company appears in a screener of stocks with improving RoCE.

  • Hindustan Constructionsurges more than 4% as its Swiss subsidiary, Steiner AG, signs an agreement to sell its entire stake in Steiner Construction SA to Demathieu Bard for Rs 928 crore.

  • HCL Technologiesis rising as its UK subsidiary, HCL Investments UK, signs a memorandum of understanding (MoU) worth $170 million (approx. Rs 1,417.7 crore) with State Street International Holdings. This MoU is for the sale of HCL UK's 49% stake in a joint venture with State Street International Holdings.

Riding High:

Largecap and midcap gainers today include Adani Green Energy Ltd. (1,348.50, 20.00%), Adani Energy Solutions Ltd. (1,084.40, 20.00%) and Adani Total Gas Ltd. (877.85, 19.88%).

Downers:

Largecap and midcap losers today include ICICI Prudential Life Insurance Company Ltd. (544.40, -3.36%), Mahindra & Mahindra Financial Services Ltd. (270.10, -2.74%) and JSW Energy Ltd. (415.20, -2.19%).

Volume Shockers

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

Top high volume gainers on BSE included Adani Energy Solutions Ltd. (1,084.40, 20.00%), Adani Total Gas Ltd. (877.85, 19.88%) and Adani Enterprises Ltd. (2,959.35, 16.91%).

Top high volume losers on BSE were Mahindra & Mahindra Financial Services Ltd. (270.10, -2.74%), Sapphire Foods India Ltd. (1,421.70, -1.76%) and Page Industries Ltd. (36,848.45, -1.71%).

Rallis India Ltd. (255.30, 9.57%) was trading at 9.8 times of weekly average. JK Paper Ltd. (394.15, 6.83%) and JK Lakshmi Cement Ltd. (876.95, 6.22%) were trading with volumes 9.1 and 6.7 times weekly average respectively on BSE at the time of posting this article.

BSE 500: highs, lows and moving averages

69 stocks hit their 52 week highs,

Stocks touching their year highs included - Adani Ports & Special Economic Zone Ltd. (1,013.10, 15.30%), Adani Power Ltd. (538.15, 15.81%) and Apollo Hospitals Enterprise Ltd. (5,580.20, -0.75%).

8 stocks climbed above their 200 day SMA including Adani Total Gas Ltd. (877.85, 19.88%) and Rossari Biotech Ltd. (796.55, 3.23%). 1 stock slipped below their 200 SMA including HFCL Ltd. (66.85, -1.26%).

 
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The Baseline
04 Dec 2023
When CEOs are kicked out of their companies | Screener: CEO exits in 2023

Some CEOs and their boards fight like cats. And if the CEO is fired as a result, they rarely come out looking good.

Take Steve Jobs’ firing from Apple. Jobs was not just any CEO – he was one of the two Steves who cofounded Apple in 1976.  Alongside Steve Wozniak, he built Apple up from a garage, but was fired by the board in 1985. Eleven years later, he would be asked to return and rebuild the company.

Jobs later admitted that he deserved to be fired – “It was awful-tasting medicine, but the patient needed it”. He had the personality of sandpaper, and would often refer to his employees' work using four-letter words. The two Apple products he spearheaded before his firing, the Lisa and Macintosh, underperformed in the market, with the Lisa computer doing so badly that the company buried 2,700 of them in a garbage dump to get a tax break. The MacIntosh was slow as a snail: a stingy 128K of memory meant that you were in for a long wait just to save a file. 

OpenAI CEO Sam Altman’s firing earlier this month was a very different case. Here it was the board that looked unreasonable and bizarre, as it failed to give a clear reason for pushing Altman out. Soon enough, nearly all of OpenAI's employees threatened to resign, and on twitter Sam received hundreds of heart emojis from his former employees, a love-fest that ended with his triumphant return as CEO.

Sam Altman’s case may be the rarest of the rare, where a company board got rid of its CEO because he was being too ambitious, too aggressive, in pushing AI into new frontiers and courting investors. Usually, when CEOs are fired, the cause is very different. We take a look at the circumstances under which some US and Indian leaders were pushed out in recent years. 

In this week’s Analyticks:

In the hot seat: When CEOs are sent packing by their companies

Screener: CEO exits in 2023

In reality, CEOs are not easily fired

When fundamental disagreements over strategy and business rise up between boards and CEOs, they are hard to bridge. But in many of those cases, a CEO will just resign. A firing usually needs more reasons than that. A sample look at CEO firings across US and India, suggests that the bar to push a CEO out tends to be high.

In a few high-profile cases, like Cyrus Mistry at Tata Sons and Bob Chapek at Disney, the firing was a result of underperformance and disappointing results. Cyrus Mistry’s firing was in part, driven by his fumbling of an ongoing dispute between Tata and telecom company Docomo. Bob Chapek was fired from Disney after a disastrous October 2022 quarter, when the company blindsided investors by missing both its revenue and net profit estimates, and reported $1.5 billion in losses in its streaming division. 

Fraud is another major theme in CEO firings -- from the payments scandal at US company Groupon, to the exit of BharatPe's CEO Suhail Sameer, after serious fraud allegations against co-founder Ashneer Grover. Brightcom MD Suresh Reddy was similarly forced to exit the company this year in August when a government inquiry discovered siphoning of funds and roundtripping. 

Sexual assault has emerged as another factor over the past decade. Between 2014 and 2020, the #MeToo movement burst into public view, toppling several CEOs. Besides the infamous Harvey Weinstein scandal, sexual assault allegations also unravelled the careers of Dov Charney at American Apparel, Sean Rad at Tinder and Travis Kalanick at Uber. In India, Binny Bansal got pushed out of Flipkart after an assault allegation came to light. 

Altman, Jobs, Dorsey: When do fired CEOs return?

In some cases, the board and a fired CEO make up. Sam Altman returned to OpenAI within a week, in record time. Jack Dorsey was fired from Twitter by the board in 2008 due to underperformance, but returned in 2015. 

The most famous example of the returning CEO is probably Steve Jobs. Jobs returned to Apple eleven years after his firing, to turn a struggling company into a money-making powerhouse. A pattern emerges in all these cases of a fired CEO's triumphant return: all three were company founders. When businesses lost their way, they turned back to the original founder for guidance. And while Jobs oversaw a successful turnaround, in the case of Dorsey, Twitter continued its struggle to find a successful business model even after his return. 

Does a high-profile firing ruin a CEO’s career? In the war of words and press releases that follow a CEO's firing, the board rarely loses. Mistry tried to restore his reputation via a legal fight with Tata Sons, which he lost. Steve Jobs' star didn't rise again until he was back at Apple. 

Even in the case of OpenAI -- Sam Altman would have likely thrived at Microsoft, but he would have no longer been calling the shots. No matter how senior you are, leaving a company under a cloud means that a lot of opportunities go underwater.

Screener: Exits of top management in 2023

Suzlon Energy leads in one-year change% post its CEO’s exit

In this screener, we take a look at the one-year change and quarter change of companies that witnessed resignations from their Chief Executive Officers (CEOs) and Managing Directors (MDs) in 2023.

Stocks from the banking & finance, consumer durables, software & services, utilities and chemicals & petrochemicals sectors show up in the screener. Major stocks that appear in the screener are Suzlon Energy, Lloyds Metals & Energy, Praveg, RattanIndia Power, Orient Electric, Allcargo Logistics, GRM Overseas and Brightcom Group.

Suzlon Energy has risen the most, by 413.9% over the past year, despite its CEO, Ashwani Kumar resigning from his post on April 5. This move came after the company’s revenue fell by 9.3% YoY to Rs 1,464.2 crore in Q4FY23. Since his resignation, the company has witnessed strong growth in its net profit and revenue in Q1 and Q2FY24, owing to order wins.

On the other hand, Brightcom Group has fallen the most, by 54.2% over the previous year, amid its Managing Director, Suresh Kumar Reddy, resigning on August 8. This exit came after the Securities and Exchange Board of India (SEBI) barred Suresh Kumar Reddy and the Chief Financial Officer (CFO), Narayan Raju, from continuing in their positions. The board had found irregularities in the company’s preferential issue of shares and other suspicious activity. 

You can find more screeners here.

 
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The Baseline
04 Dec 2023
5 stocks to buy from analysts this week
By Suhas Reddy

1. Amara Raja Energy & Mobility:

ICICI Direct maintains a 'Buy' rating on this auto parts and equipment company with a target price of Rs 900, indicating an upside of 17.1%. Analyst Shashank Kanodia is positive about the company’s growth in the automotive and industrial battery space.

Kanodia believes that the company is a major player in steady-state lead-acid batteries, with 70% of its sales coming from the automobile sector and the rest from the industrial side. He notes its strong presence across OEM and aftermarket channels, and its leadership in the aftermarket space. According to the analyst, the company is increasing its focus on the new energy sector, in response to the global shift towards electric vehicles.

With the recent MoU with the Government of Telangana to establish a Li-Ion battery Giga factory, involving an investment of Rs 9,500 crore over the next 10 years, Kanodia sees promising long-term prospects for the company. He notes that the company's stock is currently trading at an inexpensive valuation, considering the steady growth in its base business and its increasing focus on the new energy domain.

2. Kaynes Technology India:

HDFC Securities initiates coverage on this electrical equipment manufacturer with a ‘Buy’ rating and a target price of Rs 2,850. This implies an upside of 14.9%. Analysts Naveen Trivedi, Paarth Gala and Riddhi Shah believe the company’s superior execution capabilities will enable it to become the biggest beneficiary of the improving market conditions in the electronics system design & manufacturing (ESDM) sector. They expect the ESDM sector in India to grow at a CAGR of 30% over FY22-27, driven by rising domestic demand and the Centre’s focus on import substitution. 

The analysts point out that Kaynes has outperformed its peers in revenue growth over the past three years. They expect the firm to continue this trend, given its presence in the business-to-business segment, focus on value-added products and scale of operations.

Trivedi, Gala and Shah are also optimistic about the company’s expansion into the semiconductor engineering segment with its outsourced semiconductor assembly and test (OSAT) plant in Telangana. They expect its revenue to grow at a CAGR of 42% over FY23-26.

3. Siemens:

BOB Capital upgrades its rating on this heavy electrical equipment manufacturer to a ‘Buy’, with a target price of Rs 4,400. This indicates an upside of 15.6%. The company’s revenue increased by 25.1% YoY in Q2FY24, while its profit fell 12.4% YoY. Analysts Vinod Chari, Arshia Khosla and Swati Jhunjhunwala say, “Siemens saw double-digit growth across segments during the quarter, with the mobility segment posting the highest increase of 61% YoY”.

The company’s management expects a 33% hike in public capital outlay for FY24 to Rs 10 lakh crore, including a rail expenditure of Rs 2.4 lakh crore and a production-linked incentive outlay of Rs 30,000 crore. This, they believe, will create a positive capex environment. The analysts believe that the company will continue its current trend as the plan to sell the low-voltage motors business for Rs 2,200 crore has been rejected by minority shareholders. They believe that Siemens' base business is strong and well-positioned to benefit from the capex cycle due to its diverse customer segments. 

4. State Bank of India:

Motilal Oswal reiterates its ‘Buy’ call on this bank with a target price of Rs 700. This indicates an upside of 17.7%. In Q2FY24, the bank’s profit increased 8% YoY to Rs 14,330 crore, while its profit grew 26.4% YoY. Analysts Nitin Aggarwal, Dixit Sankharva and Disha Singhal say, “State Bank’s robust performance has been helped by strong loan growth and lower provisions.”

In an interactive session with the bank’s Chairman, Dinesh Kumar Khara, the analysts say they gained insights into the bank’s capital adequacy and growth plans. Despite recent declines in NIMs, the management has guided for broadly stable margins (with a downside bias of 3-5 basis points), as the bank has measures in place to mitigate the rising cost of deposits. The analysts say, “The asset quality performance remains strong with consistent improvements in headline asset quality ratios, while the restructured book remains under control at 0.6%.” They estimate the bank to deliver RoA of 1.1% and RoE of 18.3% by FY25.

5. Raymond:

SBI Securities maintains its ‘Buy’ rating on this textile company with a target price of Rs 1,762, implying an upside of 11.3%. In Q2FY24, the firm’s reported revenues stood at Rs 2,321 crore, growing by 5% YoY, while the net profit increased by 150% YoY to Rs 1,514 crore. Analysts believe that despite subdued domestic demand and lower discretionary spending, the firm has managed to deliver a strong EBITDA of Rs 384 crore, an 8% YoY increase. This is mainly due to sustained demand in the real estate segment, where the firm is developing 100 acres with a potential revenue of Rs 20,000 crore.

According to the analysts, the firm has turned debt-free after the sale of its FMCG vertical to Godrej Consumer for Rs 2,825 crore this year. Additionally, the company has paid external debt of Rs 1,029 crore by issuing Non-Convertible Debentures in Q1FY24. The firm has added 46 new retail stores in Q2FY24 and plans to add over 200 more in the next 12 months. The analysts are optimistic about Raymond's marketing strategies in the textile segment and its personalised interactive bot, which improves the customer journey through WhatsApp-based interactions. 

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

(You can find all analyst picks here)

 
Trendlyne Marketwatch
Trendlyne Marketwatch
04 Dec 2023
Market closes higher, Eicher Motors' monthly wholesales grow by 13% YoY to 80,251 units in November
By Trendlyne Analysis

Nifty 50closed at 20,686.80 (418.9, 2.1%), BSE Sensexclosed at 68,865.12 (1,383.9, 2.1%) while the broader Nifty 500closed at 18,448.50 (333.2, 1.8%). Market breadth is in the green. Of the 2,024 stocks traded today, 1,257 were gainers and 712 were losers.

Nifty 50extended its gains from the afternoon session and closed at an all-time high of 20,686.8 points. The Indian volatility index, Nifty VIX, rose 4.9% and closed at 13 points. Eicher Motors hit its all-time high and closed 7.4% higher after its monthly wholesales increased by 13% YoY to 80,251 units due to a surge in sales of two-wheelers with engine capacity exceeding 350cc.

Nifty Smallcap 100 and Nifty Midcap 100 closed in the green, taking cues from the benchmark index. Nifty Bank and Nifty Realty closed sharply above their Friday close. According to Trendlyne's sector dashboard, Commercial Services & Supplies was the top-performing sector of the day as it rose 4.1%.

Major Asian indices closed flat or lower, except for India’s BSE Sensexclosing in the green. European indices traded flat or higher amid mixed global cues. US index futures trade marginally lower, indicating a cautious start to the trading session. Brent crude oil futures extended their losses and traded in the red for third straight trading session.

  • Relative strength index (RSI) indicates that stocks like Trent, Power Finance Corp, Hindustan Aeronautics and TVS Motor and are in the overbought zone.

  • Sadhana Nitro Chem rises sharply as it plans to set up a 15-20 MW green hydrogen facility. The company's board has approved a Rs 50 crore rights issue for acquiring 126 acres of land.

  • Rail Vikas Nigam, KEI Industries, and Godawari Power & Ispat's stock prices increase 649.5%, 586.7% and 552% respectively over the past three years.

  • Gujarat State Fertilizer & Chemicals rises over 11.4% in trade and touches an all-time high of Rs 219.7 today. The company ranks high on Trendlyne’s Checklist, scoring 69.6%. It also features in a screener of stocks with improving book value per share.

  • Computer Age Management Services (CAMS) rises over 3% in trade, as 90 lakh shares (19% equity) change hands in a block deal, according to reports.

  • Zee Entertainment Enterprises plunges over 3% as Sprucegrove Investment Management sells 22.2 lakh shares (or 2.3% stake) in the company for an undisclosed amount in the open market.

  • PSU bank stocks like Central Bank of India, Union Bank of India, UCO Bank and Canara Bank surge more than 4% in trade. All constituents of the broader Nifty PSU Bank index are also trading in the green, enabling it to trade more than 3% higher.

  • Axis Direct initiates coverage on Pitti Engineering with a ‘Buy’ rating and a target price of Rs 915, implying an upside of 31.1%. The brokerage is optimistic about the firm’s prospects on the back of increasing capacity, rising share of value-added products, and expanding global footprint. It expects the company’s net profit to grow at a CAGR of 37.7% over FY23-26.

  • State Bank of India (SBI) expects the RBI to maintain its pause stance in the upcoming MPC meeting. The RBI has kept the repo rate unchanged at 6.5% four consecutive times, following a cumulative increase of 250 bps from May 2022 to December 2022.

  • Mahindra & Mahindrais rising with a 15.6% YoY increase in total monthly wholesales to 1 lakh units in November. Its auto business sees a 21% rise in wholesales to 70,576 units, driven by a 32% YoY growth in domestic SUV wholesales. Its farm equipment segment’s wholesales also rise by 5.1% YoY. Veejay Nakra, President of the automotive division, says, “We continue our growth trend, backed by strong demand for our SUV portfolio.”

  • Eicher Motorsrises to an all-time high of Rs 4,045 as its monthly wholesales increase by 13% YoY to 80,251 units due to a surge in sales of two-wheelers with engine capacity exceeding 350cc. The company appears in a screenerof stocks with increasing revenue for the past four quarters.

  • GAIL (India)surges over 5% to touch its all-time high of Rs 143.9 per share as it files an arbitration claim worth $1.8 billion (approx. Rs 15,000 crore) against SEFE Marketing & Trading Singapore Pte. in the London Court of International Arbitration. The claim is regarding SEFE's failure to supply LNG cargo under a long-term contract.

  • Reports suggest that 58.2 lakh shares (0.1% equity) of Reliance Industries, amounting to around Rs 1,405.1 crore, change hands in a large trade.

  • Maruti Suzuki India is falling as its total monthly wholesales drop by 3.3% YoY in November to 1,47,763 units. The 21% decline in mini and compact passenger car wholesales (accounting for nearly 60% of total sales) offset the surge in utility vehicle wholesales.

  • Bigbloc Construction rises as its subsidiary, Bigbloc Building Elements, doubles its AAC block manufacturing capacity from 2.5 lakh to 5 lakh cubic meters. The project is expected to be completed in the next six months with a capex of Rs 30 crore.

  • BCL Industries rises as it bags an order worth Rs 561 crore to supply ethanol to oil marketing companies. The company appears in a screener of stocks nearing 52-week high with significant volumes.

  • Brigade Enterprises is rising as it launches a residential project in Bengaluru, spanning 14 acres and featuring 1,275 units, with a revenue potential of Rs 2,000 crore. The company shows up in a screener for stocks with RoA improving over the past two years.

  • Vivek Kumar Dewangan, Chairman & Managing Director of REC, projects the company's assets under management (AUM) to reach around Rs 5.1 lakh crore in FY24, with 30% anticipated from the renewable energy segment. He also highlights that REC targets opportunities in the renewable segment worth Rs 3 lakh crore.

  • Oil & gas stocks like Hindustan Petroleum Corp, GAIL (India), Indian Oil Corp and Adani Total Gas surge more than 4% in trade. All constituents of the broader BSE Oil & Gas index are also trading in the green, enabling it to trade more than 3% higher.

  • Kalpataru Projects Intl is rising as it bags multiple orders worth Rs 2,263 crore in the transmission & distribution, water and building & factories businesses from domestic and international clients. These orders take the company's order book for FY24 to Rs 14,441 crore.

  • Shree Digvijay Cement's Chief Executive Officer (CEO) and Managing Director (MD) KK Rajeev Nambiar resigns for personal reasons. His resignation is effective from December 15, 2023. Ramanujan Krishnakumar will take over as Additional Director and CEO & MD from December 16.

  • Macquarie notes the strong performance of two-wheelers during the festive season and a healthy 10% growth in passenger vehicle registrations. Tata Motors and TVS Motor are among the preferred picks in the sector.

  • Surya Roshni's Chief Executive Officer Tarun Baldua resigns, effective from November 30, 2023, to pursue his goals outside the organization.

  • Ashish Kacholiabuys a 0.9% stake in Brand Concepts for approx Rs 6.6 crore in a bulk deal on Friday.

  • Salasar Techno Engineeringsurges over 3% as it bags an engineering, procurement and construction (EPC) contract worth Rs 364 crore from Tamil Nadu Generation and Distribution Corp. The contract involves supplying a high-voltage distribution system, feeder segregation, and transmission lines, with completion expected within the next 36 months.

  • Tata Powersurges over 3% to its 52-week highof Rs 278 per share as it acquires Bikaner-III Neemrana-II Transmission for Rs 1,544 crore from Power Finance Corp. This SPV, set up by PFC Consulting (a subsidiary of Power Finance Corp), will evacuate 7.7 GW of renewable energy from the Bikaner Complex in Rajasthan. It is expected to be commissioned in 24 months.

Riding High:

Largecap and midcap gainers today include Adani Green Energy Ltd. (1,123.75, 9.47%), Hindustan Petroleum Corporation Ltd. (376.50, 8.96%) and Eicher Motors Ltd. (4,180.35, 7.43%).

Downers:

Largecap and midcap losers today include Zee Entertainment Enterprises Ltd. (255.90, -4.00%), Lupin Ltd. (1,260.55, -2.78%) and Solar Industries India Ltd. (6,033.10, -2.52%).

Crowd Puller Stocks

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

Top high volume gainers on BSE included Gujarat State Fertilizer & Chemicals Ltd. (215.30, 11.15%), Central Bank of India (48.30, 9.03%) and Lloyds Metals & Energy Ltd. (570.00, 8.84%).

Top high volume losers on BSE were Whirlpool of India Ltd. (1,321.05, -6.71%), KNR Constructions Ltd. (269.85, -5.51%) and Glenmark Pharmaceuticals Ltd. (775.75, -2.13%).

360 One Wam Ltd. (602.55, 2.86%) was trading at 25.5 times of weekly average. G R Infraprojects Ltd. (1,074.50, 2.73%) and Swan Energy Ltd. (417.90, 0.64%) were trading with volumes 9.8 and 5.8 times weekly average respectively on BSE at the time of posting this article.

BSE 500: highs, lows and moving averages

102 stocks hit their 52 week highs,

Stocks touching their year highs included - Adani Power Ltd. (464.70, 5.52%), Ajanta Pharma Ltd. (1,959.35, -0.19%) and Apollo Tyres Ltd. (449.95, 1.70%).

13 stocks climbed above their 200 day SMA including Hindustan Zinc Ltd. (317.90, 5.91%) and Adani Total Gas Ltd. (732.25, 4.39%). 2 stocks slipped below their 200 SMA including Whirlpool of India Ltd. (1,321.05, -6.71%) and Akzo Nobel India Ltd. (2,480.05, -0.06%).