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The Baseline
06 Oct 2023
Five Interesting Stocks Today

1. Bajaj Finance: 

This NBFC touched its 52-week high of Rs 8,192 per share and closed 4.1% higher on Friday, a day after announcing its Q2FY24 business update.  The company’s board of directors approved the raising of Rs 8,800 crore through qualified institutional placement (QIP) on Thursday, subject to approval from shareholders. Funds from the QIP will be used to reduce the company’s cost of capital and increase its AUM growth, and is a response to rising competition in the sector.

The stock has risen by 11.2% over the past month, outperforming the Nifty 50 index by 10.8 percentage points. This helped the company appear in a screener of stocks with high momentum scores.

The NBFC’s assets under management (AUM) improved by 33% YoY to Rs 2.9 lakh crore for the quarter, aided by increased deposits and new loans. This growth beat Jefferies’ estimates by 300 bps. The company’s customer franchise increased by 3.6 million YoY to 76.6 million, and remains on track to achieve its guidance for 12-13 million growth in users during FY24. Trendlyne’s Forecaster predicts revenue growth of 26.8% YoY in Q2 and 24.8% YoY in FY24. 

Post the business update, BOB Capital Markets maintains its ‘Buy’ rating on the stock with a target price of Rs 9,105 per share. This indicates a potential upside of 16%. The brokerage believes that the company’s strong AUM growth, diverse product mix and efficient execution will help it keep up with competitors and improve its asset quality. It expects the company’s net interest income to grow at a CAGR of 20% over FY22-25. 

2. Kaynes Technology India:

This electronics manufacturing services (EMS) company has risen 13.6% over the past week till Friday, riding on the back of a healthy business outlook. The Indian EMS industry is expected to benefit from the global shift in supply chains, positioning Kaynes to profit from its presence across various industrial segments. The company provides manufacturing services to firms in the automotive, railways, aerospace, defence, medical and information technology sectors.

As the company mostly caters to other industrial businesses, its primary exposure is to the business-to-business (B2B) segment. According to reports, Morgan Stanley expects EMS companies with high B2B exposure to outperform their peers due to reduced competition and higher margins. It adds that this will enable companies to spend more on research & development and increase the scope for backward integration.

The management states that the firm has a low customer concentration, with the top five clients making up 44% of the total revenue. Kaynes also added one large multinational client in Q1FY24. 

Trendlyne's Forecaster estimates the firm’s revenue to surge by 33.5% QoQ and 99% YoY to Rs 396.7 crore in Q2FY24. It shows up in a screener for companies with net cash flows improving over the past two years.

With ambitions to foray into semiconductor manufacturing, Kaynes signed an MoU with the Karnataka Government on August 24. The agreement involves an investment of Rs 3,750 crore to set up a Semiconductor Assembly and Testing (OSAT) facility and a Printed Circuit Board (PCB) manufacturing plant. The management plans to start production in both plants by the end of 2024 and expects the benefit to flow in from H2FY25. 

3. South Indian Bank: 

This bank’s stock price fell by 1.5% on Thursday, following its business update. The decline was likely due to the rising cost of funds for the bank, due to a falling CASA (current account savings account) ratio and slowing credit growth. The stock had jumped by 11.2% over the past month, according to Trendlyne’s Technicals. The company was also recently in the news for the appointment of P R Seshadri as its new CEO & MD following RBI’s approval.

SIB’s provisional Q2FY24 update has recorded a 10.3% YoY surge in gross advances to Rs 74,975 crore. Similarly, total deposits climbed by 9.8% YoY. By the end of Q2FY24, CASA deposits stood at Rs 31,162 crore. The bank's credit growth in FY24-25E is expected to be around 12-13%. Moves to stabilise the liability mix, adjust interest rates on 65% of deposits, launch new retail products, and improve yields are expected to boost profits by 10-20 basis points. The stock appears in a screener of companies with high interest payments compared to earnings.

The management expects net interest margins to rise by 20 bps to 3.5% by Q4FY24, partly from growth in high-yielding loans. The bank also aims for a 1% return on assets (RoA) by the end of FY24.

ICICI Securities says that the qualification of the new MD & CEO will be critical to the stock’s rerating. They see RBI’s approval for the appointment of P R Seshadri as a key positive for the bank. According to the brokerage, he played a crucial role in improving risk management at Karur Vysya Bank and achieving credit growth despite profitability pressures from rising NPAs. The broker maintains a ‘Buy’ rating on the stock.

4. TVS Motor: 

This two/three-wheeler manufacturer has fallen by 2.3% since announcing its September business update on Tuesday. The decline is on account of lower quarterly three-wheeler wholesales, which contracted by 15.7% YoY in Q2FY24. 

In September 2023, the company’s total wholesales rose by 6% YoY to 4 lakh units, and its electric vehicle (EV) wholesales surged 4X YoY to 20,356 units. TVS has also been seeing an increase in exports, registering an 8% growth in September despite a high base.

Taking note of the healthy response to EVs, TVS Motor launched its second electric scooter, TVS-X, for Rs 2.5 lakh. The recent launch of Apache RTR 310, priced at Rs 2.4-2.6 lakh, also indicates the company’s interest in catering to the premium lifestyle segment market. The company aims to gain market share by introducing multiple products in numerous segments. It is also expected to launch electric three-wheelers in the coming quarters, and has started exporting EVs to Nepal with plans to expand to other markets.

In Q1FY24, the automobile manufacturer’s net profit grew by 42.2% YoY to Rs 434.3 crore, beating Trendlyne Forecaster’s estimate by 6.9%. Its revenue also increased by 24.4% YoY. Even though TVS’ EBITDA margin has been in the range of 10% for the past eight quarters, the management hopes to improve it further through a better product mix, price hikes, and a focus on premiumization. The company features in a screener for stocks with improving cash flow and good durability.

Sharekhan maintains a ‘Buy’ call on TVS on the back of new launches and a gradual revival in export volumes. Analysts expect a healthy festive season and believe that the company will see robust traction in volumes, backed by its product portfolio.

5. Marico

This FMCG company has fallen by over 5.9% since the announcement of its business update on Thursday. Marico reported a low single-digit YoY volume growth in Q2FY24. It’s domestic volumes grew by 3% YoY in Q1FY24. The company attributed weak rural demand as the reason for this muted volume growth. Parachute Coconut Oil and Saffola Edible Oils’ volumes (contributing to around 37% and 31% of the total revenue) also grew in the low-single digits. 

Marico highlighted that its consolidated revenue has moderated during the quarter due to price corrections in its key domestic portfolio. In Q1FY24, the company’s revenue dropped by 2.1% YoY to Rs 2,523 crore, driven by price cuts taken in its Saffola Edible Oils segment. According to Trendlyne’s Forecaster, its revenue is expected to grow 3.4% YoY in Q2FY24. The company is set to declare its Q2 results on October 30.

The FMCG company’s management said that the recent surge in food prices and below-normal rainfall in some regions have dampened rural demand. According to Saugata Gupta, the MD and CEO of the firm, “Factors such as retail inflation dropping to sub-5% levels, late pickup in monsoons, hike in kharif crop MSPs (minimum support price) and higher government spending give us hope for a gradual recovery in rural sentiment”. He added that Marico targets a volume growth of around 8% in the medium term. 

The company’s share price touched a new 52-week high on Tuesday after ICICI Securities upgraded its rating to ‘Buy’ and raised the target price to Rs 670. The brokerage is optimistic about the company's efforts to accelerate expansion while maintaining its market share. As a result, Marico features in a screener of stocks where brokers have upgraded recommendations or target prices in the past three months.

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
06 Oct 2023
Market closes higher, Valiant Laboratories’ shares debut at a 15.9% premium

Trendylne Analysis

Nifty 50closed at 19,653.50 (107.8, 0.6%), BSE Sensexclosed at 65,995.63 (364.1, 0.6%) while the broader Nifty 500closed at 17,293.60 (97.8, 0.6%). Market breadth is in the green. Of the 1,954 stocks traded today, 1,237 showed gains, and 665 showed losses.

Indian indices extended the gains from the afternoon session and closed in the green, with the Nifty 50 closing at 19,654. The volatility index, Nifty VIX, dropped by 5.9% and closed at 10.3 points. Ujjivan Small Finance Bank's total deposits grew by 43% YoY to Rs 29,134 crore in Q2FY24, while advances rose 27% YoY to Rs 29,134 crore.

Nifty Midcap 100 and Nifty Smallcap 100 closed in the green, following the benchmark index. Nifty Realty and Nifty Pharma closed higher than Thursday’s closing levels. According to Trendlyne’s sector dashboard, realty emerged as the top-performing sector of the day, with a rise of over 2.7%.

Most European indices trade in the green. US indices futures trade higher, indicating a positive start. The data released by the German Federal Statistical Office indicated that German factory orders in August rose 3.9% MoM against the estimates of 1.8%. German factory orders in July contracted by 11.7% MoM.

  • Money flow index (MFI) indicates that stocks like Suven Pharmaceuticals, Gujarat Ambuja Exports, Suzlon Energy and Tata Investment Corp are in the overbought zone.

  • Mahindra Holidays & Resorts rises over 7% in trade today. The company ranks high on Trendlyne’s Checklist, scoring 59.1%. It also features in a screener of consistent highest-return stocks over five years.

  • Bharat Heavy Electricals rises as it wins two arbitration proceedings against Jaiprakash Power Ventures. This led the company to bag contracts for the 660 MW Jaypee Nigrie Thermal Power Project and the 250 MW Bina Thermal Power Plant. The company appears in a screener of stocks with improving RoA.

  • Dabur India's management expects its revenue to grow in the mid to high single digits in Q2FY24. It also expects net profit to increase proportionally. The company features in a screener of stocks with low debt.

  • PB Fintech falls as 1.1 crore shares (a 2.5% stake), amounting to Rs 871.2 crore, reportedly change hands in a bulk deal. SoftBank is the likely seller.

  • Sharekhan maintains its ‘Buy’ rating on Indian Hotels Co with a target price of Rs 492, implying an upside of 16.3%. The brokerage believes the company is well-placed to benefit from the rising demand for travel in FY24, given its focus on expanding through the asset-light model, improving cash flows and strengthening of balance sheet. It expects the firm’s net profit to grow at a CAGR of 27% over FY23-26.

  • Realty stocks like DLF, Godrej Properties, Sobha, Swan Energy and Brigade Enterprises are rising in trade. Barring Mahindra Lifespace Developers, all the other constituents of the broader sectoral index, Nifty Realty, are trading in the green.

  • HDFC Securities maintains its ‘Buy’ rating on Navin Fluorine International with a target price of Rs 5,368. This implies an upside of 44.3%. The brokerage believes the firm’s growth momentum is intact despite the resignation of its Managing Director, Radhesh Welling. It expects growth to be driven by long-term contracts, rising contribution from the high-margin business to the sales mix and capacity expansion.

  • Strides Pharma Science declines as reports suggest that 13.8 lakh shares (1.5% equity), amounting to Rs 69.1 crore, change hands in a large trade.

  • Valiant Laboratories’ shares debut on the bourses at a 15.9% premium to the issue price of Rs 140. The Rs 152.5 crore IPO has received bids for 29.8 times the total shares on offer.

  • Ujjivan Small Finance Bank surges as its total deposits grow by 43% YoY to Rs 29,134 crore in Q2FY24, while advances rise 27% YoY to Rs 29,134 crore.

  • InterGlobe Aviation (IndiGo Airlines)rises as reports suggest that it will introduce a fuel charge of up to Rs 1,000 to offset the rising cost of aviation fuel. The fuel surcharge applies to both domestic and international routes and will take effect starting today. The company appears in a screenerof stocks with improving cash flow from operations.

  • HDFC Securities maintains its ‘Buy’ rating on Navin Fluorine Internationalwith a target price of Rs 5,368. This implies an upside of 44.3%. The brokerage believes the firm’s growth momentum is intact despite the resignation of its Managing Director, Radhesh Welling. It expects growth to be driven by long-term contracts, rising contribution from the high-margin business to the sales mix and capacity expansion.

  • Macquarie has an ‘Outperform’ rating on Jindal Steel & Power, Tata Steel and Hindalco, while it downgrades its rating on JSW Steel to ‘Neutral’. The brokerage believes that robust domestic demand and strong steel prices augur well for the steel companies.

  • Sun Pharmaceutical Industries rises as it announces the US FDA's acceptance of its new drug, Deuruxolitinib, used to treat adults with moderate to severe alopecia areata. It appears on a screener for stocks with strong annual EPS growth.

  • Foreign institutional investors sell stocks worth Rs 7,660.6 crore in the equity market over the past week, according to Trendlyne's FII dashboard. Meanwhile, index options witness the highest outflow of Rs 1.3 lakh crore from foreign investors.

  • Railtel Corp of India rises as it wins a work order worth Rs 68 crore from Jammu Smart City to commission a data centre and disaster recovery centre for the Integrated Command and Control Centre.

  • The RBI's Monetary Policy Committee (MPC) maintains India's real GDP growth forecast for FY24 at 6.5% while CPI inflation for Q2FY24 has been raised to 6.4%. According to RBI Governor Shaktikanta Das, challenges to the future outlook include geopolitical tensions, potential global economic recession, and irregular monsoon.

  • KPI Green Energy rises as it bags multiple orders for the development of solar power projects, totalling 12.1 MW from domestic entities. The projects are expected to be completed in FY24 in various tranches. The company appears in a screener of stocks with strong momentum.

  • Kalyan Jewellers is rising after announcing its Q2FY24 business update, as its revenue increases by 27% YoY, led by robust momentum in footfalls across Indian and Middle Eastern markets. Revenue from its Indian operations climbs 32% YoY due to healthy same-store sales. The stock shows up in a screener for companies with improving RoA over the past two years.

  • Healthcare stocks like Aurobindo Pharma, Granules India, Alkem Laboratories and Dr Reddy's Laboratories are rising in trade. All constituents of the broader Nifty Healthcare index are also trading in the green.

  • Adani Wilmar rises as its total standalone sales volumes grow by 11%, aided by growth in the industry essentials and food & FMCG segments. However, there's a 13% dip in standalone sales value due to a decline in the edible oil segment. The company appears in a screener of stocks with improving net cash flow.

  • RBI decides to keep the policy repo rate unchanged at 6.5% during the Monetary Policy Committee meeting.

  • Lupin is rising as it receives tentative approval from the US FDA for its abbreviated new drug application for tolvaptan tablets. This generic variant of Otsuka Pharmaceutical's Jynarque tablets is used for the prevention of heart failure and hormone imbalance. According to IQVIA, the drug had an estimated annual sales of $287 million in the year ending August 2023.

  • Dolly Khannabuys a 0.1% stake in Talbros Automotive Componentsin Q2FY24. She now holds a 1.6% stake in the company.

  • Bajaj Financeis rising as its board of directors approves the issue of shares worth up to Rs 8,800 crore through a qualified institutional placement (QIP).

Riding High:

Largecap and midcap gainers today include Bajaj Finserv Ltd. (1,634.65, 5.97%), General Insurance Corporation of India (225.30, 5.18%) and Godrej Properties Ltd. (1,675.00, 4.73%).

Downers:

Largecap and midcap losers today include Vodafone Idea Ltd. (10.95, -2.23%), CG Power and Industrial Solutions Ltd. (418.75, -1.70%) and Gujarat Fluorochemicals Ltd. (2,845.50, -1.61%).

Movers and Shakers

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

Top high volume gainers on BSE included Godrej Industries Ltd. (719.10, 19.64%), Kalyan Jewellers India Ltd. (258.15, 10.13%) and Mahindra Holidays & Resorts India Ltd. (433.80, 7.64%).

Top high volume losers on BSE were BASF India Ltd. (2,506.75, -1.54%), Alembic Pharmaceuticals Ltd. (772.85, -0.39%) and Rajesh Exports Ltd. (496.95, -0.21%).

Godrej Agrovet Ltd. (515.00, 7.36%) was trading at 15.2 times of weekly average. AstraZeneca Pharma India Ltd. (4,726.10, 4.93%) and Century Plyboards (India) Ltd. (653.40, 0.97%) were trading with volumes 12.8 and 10.4 times weekly average respectively on BSE at the time of posting this article.

BSE 500: highs, lows and moving averages

19 stocks overperformed with 52 week highs,

Stocks touching their year highs included - Bajaj Finance Ltd. (8,168.55, 4.05%), DLF Ltd. (548.70, 4.51%) and eClerx Services Ltd. (2,147.85, 6.21%).

6 stocks climbed above their 200 day SMA including PI Industries Ltd. (3,420.70, 1.03%) and Sterlite Technologies Ltd. (159.40, 0.28%). 1 stock slipped below their 200 SMA including BASF India Ltd. (2,506.75, -1.54%).

 
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The Baseline
05 Oct 2023
By Akshat Singh

Investors are constantly on the lookout for investment strategies that deliver outsize returns. Managing a portfolio that consistently outperforms its benchmark over time is a feat achieved by very few. Often, you will find ‘finfluencers’ on youtube claiming market-beating returns every time they invest. The reality of the stock market however, is that it is volatile, and there will be periods of negative as well as positive returns. 

One way to maximize returns is via screeners that automatically search for stocks that outperform on not one, or two but multiple metrics. The DVM score, for example, looks at several metrics across management quality, financial health, stock valuation, as well as several dozen technicals, to identify high-scoring stocks. With these scores, investors are able to shortlist higher quality stocks for investing. 

In this edition of Chart of the Week, we analyse one DVM screener - the ‘DVM - High Performing, Highly Durable Companies’ screener. This screener selects stocks from the Nifty 500 index that show strong financial durability, reasonable valuation, and positive momentum scores. It is optimised to highlight the top five stocks with the highest durability scores. 

The screener backtest checks for past returns generated, and ran from March 2013 to September 2023, evaluating this strategy’s quarterly performance against the Nifty 500 benchmark. The screener has given cumulative returns of 2,772.8% over 10 years and 6 months, with a CAGR of 37.4%. In contrast, the benchmark’s CAGR stands at 14.5 %.

The heatmap presents a period analysis, showcasing the strategy's quarterly returns from Q1FY14 to Q2FY24. The data reveals that this approach delivered positive returns in 29 out of 42 quarters. It also outperformed the Nifty 500 index in 30 of these 42 quarters. 

The strategy had its maximum drawdown of 29.9% in Q1FY23. The term maximum drawdown represents the biggest observed loss from a portfolio’s peak to its lowest point before a new peak is attained. This strategy is an automated one and did not have a stop loss set, so the drawdowns show the maximum loss potential under this approach. Introducing a stop loss can reduce periods of negative returns and lower maximum drawdowns.

The screener currently has stocks such as Great Eastern Shipping Co, Apar Industries, Natco Pharma, Maruti Suzuki India and Jindal Saw.

In the course of the backtest, Ceat gave the highest returns of 428.8%. On the other hand, Triveni Engineering & Industries’ stock price had the highest fall of 48.8%.  

Greenpanel and Jyothi Labs shine as top performers over the past two years

Greenpanel performs the best in the DVM screener over the past two years

Here, we look at stocks with the highest returns over the past two years from the DVM screener’s backtest. Greenpanel Industries was part of the screener from June 30, 2021, to June 30, 2022. During this period, it provided a return of 85.9%.

Meanwhile, Jyothy Labs entered the screener on June 30, 2023, and exited on September 22, 2023. In these three months, the company gave a return of 61.7%. This can be attributed to the rise in its net profit by 98.7% YoY to Rs 96.3 crore in Q1FY24, aided by increased rural demand. 

The tobacco major, Godfrey Phillips, remained in the screener for two quarters, from September 30, 2022, to March 31, 2023. In this duration, the company gave 58.5% returns. The company's decision in October 2022 to sell its chewing tobacco business and other trademarks allowed it to concentrate on the cigarette business. Consequently, its net profit surged by 70.3% YoY in Q3FY23 to Rs 199.2 crore.

Zydus Lifesciences, a pharmaceuticals major, was in the screener from September 30, 2022, to June 30, 2023. During this period, its stock price rose by 50.7%. On October 3, 2022, the company received the US FDA’s approval for its Mirabegron tablets, which are used to treat overactive bladder. This came with 180 days of shared generic drug exclusivity, caused the stock price to surge by 5.8%. 

Lastly, Kalyan Jewellers India, active in the screener for the past quarter, recently exited but not before registering a 46.7% return. The company’s net profit rose by 33.3% in Q1FY24 to Rs 143.9 crore, aided by expansions in northern regions of India and the UAE. 

Apar Industries and Jindal Saw post 300%+ returns in the past year

Apar Industries leads in one-year gain among active stocks

Let’s now focus on the yearly and quarterly price change % of stocks currently active in the screener. Apar Industries’ stock price rose by 353.1% in the past year and 66.9% in the past quarter. Since its inclusion in the screener on March 31, 2023, the firm has yielded a return of 101.6%. The company’s Q4FY23 net profit rose by 193.8% YoY, followed by a surge of 61.2% YoY in Q1FY24. 

The general industrials company, Jindal Saw, reported a stock price rise of 334.4% in the past year and 38.3% in the past quarter. The company posted net profit gains of 54.2X to Rs 263.1 crore in Q1FY24. On September 18, 2023, the company entered into a joint venture with Hunter Energy Services, a US-based company. As part of this collaboration, they will jointly invest $25 million (approx Rs 208.1 crore) to establish a threading plant in Maharashtra. The investment will replace imports estimated at $200 million per annum.

Meanwhile, Natco Pharma surged by 42.2% in the past year and 26.3% in the past quarter. The shipping company, Great Eastern Shipping Company, also rose by 63% in the past year and 13.8% in the past quarter. It has been active in the screener for the past quarter and has provided 9.2% returns in this period. Shipping stocks surged after global leaders announced a multinational rail and port agreement that would connect the Middle East and South Asia at the G20 summit. This led to the shipping stocks to surge by 12.2% in the past month.

Lastly, auto giant Maruti Suzuki India’s  share price rose by 20% in the past year and 8.4% in the past quarter. The company’s quarterly net profit increased by 143.7% YoY to Rs 2,525.2 crore in Q1FY24. 

In summary, the screening criteria of high returns and durability, results in stocks that can potentially deliver medium to long-term gains with moderate risk, as suggested by the max drawdown of 29.9%. Despite uncertainties like the COVID-19 pandemic, this screener gave a mean quarterly return of 10%. It also consistently held an average stock count of 4.7, implying diversified investment, except for Q1FY21 when it had no stocks. 

Investors should undertake quarterly portfolio reviews and adjustments according to the entries and exits of stocks. And keep in mind as always, that  past returns don't guarantee future outperformance.

 
Trendlyne Marketwatch
Trendlyne Marketwatch
05 Oct 2023
Market closes higher, Rites bags order worth $111 million (Rs 924 crore)

Trendlyne Analysis

Nifty 50 closed at 19,545.75 (109.7, 0.6%) , BSE Sensex closed at 65,631.57 (405.5, 0.6%) while the broader Nifty 500 closed at 17,195.80 (72.7, 0.4%), of the 1,952 stocks traded today, 1,203 were on the uptick, and 695 were down.

Indian indices extended the gains from the afternoon session and closed in the green, with the Nifty 50 closing at 19,546. The volatility index, Nifty VIX, dropped by 6.2% and closed at 10.9 points. India’s service PMI in September expanded to 61 against estimates of 59.5. India’s service PMI for August stood at 60.1.

Nifty Midcap 100 closed flat, while Nifty Smallcap 100 closed in the green, following the benchmark index. Nifty Media and Nifty IT closed higher than Wednesday’s closing levels. According to Trendlyne’s sector dashboard, media emerged as the top-performing sector of the day, with a rise of over 2%.

Most European indices trade in the red, except for England’s FTSE 100 trading flat. US indices futures trade lower, indicating a negative start. The data released by the French National Institute of Statistics and Economics indicated that France’s industrial production in August contracted by 0.3% MoM against estimates of a 0.4% decline.

  • Relative strength index (RSI) indicates that stocks like C.E. Info Systems, Kaynes Technology India, Suzlon Energy and Indian Overseas Bank are in the overbought zone.

  • NHPC shuts down all its power stations in Sikkim due to flash floods. NHPC's Teesta-V power stations (510 MW) and Teesta-VI HE Project (500 MW), situated in Teesta Basin, are the two affected projects.

  • Tata Motors is rising as its subsidiary, Tata Motors JLR UK, reports a 27.5% YoY sales growth in September to 8,125 units. The growth is due to the improvement in sales of Land Rover and Jaguar. It appears in a screener of newly affordable stocks with good financials and durability.

  • Rites is rising as it emerges as the lowest bidder in a tender floated by Bangladesh Railway, with an estimated value of $111 million (Rs 924 crore). The order involves the procurement of 200 broad-gauge passenger carriages for Bangladesh Railway.

  • Blue Star falls despite acquiring 15.1 crore shares in its subsidiary, Blue Star Climatech though a rights issue of shares at Rs 10 per share, amounting to Rs 151 crore. The company appears in a screener of stocks with low debt.

  • Cholamandalam Investment & Finance Company falls as it issues shares via qualified institutional placements at Rs 1,180 each, which is at a discount to the floor price of Rs 1,200.5. The company has issued 1.7 crore shares, raising a total of Rs 2,000 crore. It appears in a screener of stocks with high debt.

  • Morgan Stanley notes Zomato's consistent performance in core business profitability. The firm's recent hike in platform fees has been well-received by its users. The brokerage maintains an 'Outperform' rating on Zomato, with a target price of Rs 125.

  • Plaza Wires' Rs 71.3 crore IPO gets bids for 161X the available 95 lakh shares on offer on the fourth day of bidding. The retail investor quota gets bids for 374.8X the available 13.2 lakh shares on offer.

  • Tata Consultancy Services rises after being chosen by the Georgia Department of Labor to replace its cloud-based unemployment insurance system. The company appears in a screener of stocks nearing their 52-week highs with significant volumes.

  • Healthcare Global Enterprisesacquires SRJ CBCC Cancer hospital in Indore from SRJ Health Care. The company plans to expand the hospital by adding 100 beds and upgrading its cancer diagnostic and treatment facilities. The hospital is expected to be operational in two years.

  • Hindalco Industries signs an MoU with Odisha Mining Corporation for a Rs 8,000 crore investment, in two phases. This deal ensures a long-term supply of bauxite ore for Hindalco's proposed two-million-tonne alumina refinery and 150-MW captive power plant in Kansariguda, Rayagada district.

  • BoB Capital Markets maintains its ‘Buy’ rating on Bajaj Financewith a target price of Rs 9,105. This implies an upside of 15.5%. The brokerage believes the firm’s robust assets under management growth, efficient execution and diverse business model will enable it to fend off competition and manage asset quality risks. It expects the company’s net profit to grow at a CAGR of 26.8% over FY23-25.

  • India’s Services PMI rises to 61 in September from 60.1 in August, driven by favourable demand conditions, new businesses and an increase in output volumes.

  • Capri Global Holdings sells a 0.5% stake in Indiabulls Housing Finance for approx Rs 42.9 crore in a bulk deal on Wednesday.

  • Marico is falling as it reports low-single-digit volume growth YoY in Q2FY24 due to weak rural demand. The company’s consolidated revenue has been marginally lower during the quarter, driven by price corrections in its key domestic portfolios.

  • Sobha is rising as its Q2FY24 sales rise by 48.1% YoY to reach a record high of Rs 1,723.8 crore. Its average price realisation per square foot also grows by 17.4% YoY to Rs 10,223. The stock shows up in a screener for companies with improving cash flow and good durability.

  • Emkay Global initiates coverage on Indian Hotels Co and Lemon Tree Hotels with a ‘Buy’ rating, and Chalet Hotels with a ‘Hold’. According to the brokerage, demand is expected to remain strong despite limited supply. It also predicts occupancy to remain high.

  • Nazara Technologies surges more than 5% as its subsidiary, NODWIN Gaming, acquires a 100% stake in PublishME for $2 million (approximately Rs 16.6 crore).

  • Media stocks like Nazara Technologies, Network 18 Media & Investments, Sun TV Network, TV18 Broadcast and Dish TV India are rising in trade. All the constituents of the broader sectoral index, Nifty Media, are also trading in the green.

  • Larsen & Toubro secures multiple orders worth Rs 2,500-5,000 crore. The orders involve the construction of a residential township in Bengaluru, a commercial tower in Hyderabad, and a super specialty hospital at the Indian Institute of Technology, Kanpur.

  • Prashant Pitti, Co-Founder & Executive Director of Easy Trip Planners, says that the festive season and the Cricket World Cup have resulted in a surge in demand, which is 72% higher this year. He also highlights that volumes on routes like Delhi-Ahmedabad have gone up by 89%.

  • Exide Industries rises as it acquires 11 crore share, amounting to Rs 340 crore, in its subsidiary Exide Energy Solutions (EESL). EESL plans to use this amount to fund its greenfield projects. The company appears in a screener of stocks with low debt.

  • Hindustan Aeronautics is rising after announcing that the Indian Air Force intends to procure an additional 97 light combat aircraft (LCA) Tejas fighter jets. This comes after the company completed delivering the first LCA Tejas twin-seater aircraft.

  • Porinju Veliyath buys a 1% stake in Kerala Ayurveda for approx Rs 1.6 crore in a bulk deal on Wednesday.

  • Macrotech Developers’ Q2FY24 pre-sales rise 12% YoY to Rs 3,530 crore, its highest-ever quarterly pre-sales. With this, it achieves nearly half of its pre-sales guidance for FY24. Its collections increase by 16% YoY, while its net debt declines 23.5% YoY to Rs 6,730 crore.

Riding High:

Largecap and midcap gainers today include Zomato Ltd. (105.40, 4.62%), One97 Communications Ltd. (895.10, 3.71%) and InterGlobe Aviation Ltd. (2,473.40, 3.71%).

Downers:

Largecap and midcap losers today include Marico Ltd. (542.45, -4.98%), Punjab National Bank (77.10, -3.32%) and Union Bank of India (105.50, -2.72%).

Volume Shockers

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

Top high volume gainers on BSE included Infibeam Avenues Ltd. (19.70, 13.22%), SIS Ltd. (480.15, 9.61%) and eClerx Services Ltd. (2,022.25, 8.91%).

Top high volume losers on BSE were Oberoi Realty Ltd. (1,091.05, -2.68%) and Linde India Ltd. (5,968.30, -0.05%).

Prestige Estates Projects Ltd. (671.30, 7.23%) was trading at 8.7 times of weekly average. Sumitomo Chemical India Ltd. (440.80, 5.43%) and Godrej Industries Ltd. (601.05, 3.06%) were trading with volumes 6.0 and 4.7 times weekly average respectively on BSE at the time of posting this article.

BSE 500: highs, lows and moving averages

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

Stocks touching their year highs included - Balkrishna Industries Ltd. (2,585.25, 2.22%), Coromandel International Ltd. (1,166.10, 1.92%) and eClerx Services Ltd. (2,022.25, 8.91%).

Stocks making new 52 weeks lows included - Navin Fluorine International Ltd. (3,695.60, -3.39%) and Adani Total Gas Ltd. (602.90, -1.28%).

7 stocks climbed above their 200 day SMA including Sumitomo Chemical India Ltd. (440.80, 5.43%) and Bharat Dynamics Ltd. (1,001.65, 2.26%). 4 stocks slipped below their 200 SMA including Godrej Consumer Products Ltd. (976.60, -1.40%) and Dabur India Ltd. (550.75, -0.83%).

 
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The Baseline
04 Oct 2023
Five analyst picks this week
By Suhas Reddy

1. Minda Corp: 

SBI Securities gives this auto components manufacturer a 'Buy' rating with a target price of Rs 382, indicating an upside of 17.1%. The analysts are optimistic about the company due to its robust electric vehicles (EV) order book and smart key lock set. The total order wins stand at Rs 3,000 crore, of which Rs 750 crore is for battery chargers. 

Minda Corp’s management has guided a revenue growth of 20-25% over the next 2-3 years on the back of new product development, customer acquisition, and increasing exports. They also expect better efficiencies, streamlining of fixed costs and component localization initiatives to improve margins. They predict that demand will pick up in H2FY24, coinciding with the festive season. They are also positive about the improvement in semiconductor supplies due to new supplier management initiatives, and expect momentum to extend into the coming quarters. 

2. Global Health: 

Motilal Oswal initiates coverage on this healthcare facilities company with a ‘Buy’ rating and a target price of Rs 840, implying an upside of 13.4%. Analysts Tushar Manudhane, Sumit Gupta and Akash Manish Dobhada state that “the firm has been able to cater to requirements across therapeutics, making it a preferred choice among many patients”. This has enabled its net profit to grow at a CAGR of 47% over FY19-23, they add. 

The analysts expect this growth momentum to continue in the coming quarters, led by an increasing volume of patients, growth in international patients, and improving average revenue per occupied bed (ARPOD). They are also upbeat about the firm’s plans to increase capacities at its new hospitals in Lucknow and Patna. Overall, they are optimistic about the healthcare services provider’s growth prospects due to its robust business model and surplus cash. Manudhane, Gupta and Dobhanda expect the company’s net profit to grow at a CAGR of 26% over FY23-25. 

3. PI Industries: 

Geojit BNP Paribas reiterates its ‘Buy’ call on this agrochemicals company and  increases its target price to Rs 4,000. This indicates an upside of 17.9%.  According to analyst Anil R, the company’s standalone profit growth of 22.2% YoY to Rs 1,829 crore in Q1FY24 was led by robust CSM export contribution, from higher volumes and prices. “Favourable product mix and improved operating leverage expanded EBITDA margin in Q1FY24,” he says. 

The analyst expects exports to double in the coming 3-4 years on the back of government support, becoming a major revenue driver. He also remains positive about PI Industries’ plans to launch four new products in FY24, and its strong CMS export order book of $1.8 billion. Anil expects the focus on research and new acquisitions to grow the pipeline further. The management has planned a consolidated capex of Rs 900 crore for FY24, mainly for its agchem business.  

4. NTPC: 

ICICI Direct maintains a 'Buy' rating on this electric utilities company with a target price of Rs 300, indicating an upside of 27.6%. Analyst Chirag Shah holds an optimistic view as the company is the sole player that has added coal-based capacities over the past five years, reaching an impressive installed base of 73,000 MW. Notably, NTPC aims to achieve 45-50% of its capacity from non-fossil fuels by 2030.

Shah believes in the management's ability to reach 20,000 MW of renewable capacity by FY26, considering the company's current 3,300 MW of installed renewable capacity and 5,900 MW of projects under construction. He also highlights the company's efforts to diversify into emerging areas like green hydrogen and nuclear power.

Shah foresees generation growth at a CAGR of 11% over FY23-25 due to a higher power load factor (PLF) from increased electricity demand. However, he cautions that a slowdown in demand due to reduced economic activity could affect the company's PLF and profitability.

5. Brigade Enterprises: 

ICICI Securities maintains a 'Buy' rating on this realty company, with a target price of Rs 695, indicating an upside of 20.4%. Analysts Adhidev Chattopadhyay and Saishwar Ravekar are upbeat about the company's prospects due to its residential launch pipeline of 8 million square feet (msf) over the next 12 months, and significant land acquisitions with a gross development value (GDV) of Rs 53 billion.

The analysts predict residential sales bookings to reach Rs 45.8 billion in FY24 and climb to Rs 51.3 billion in FY25, fueled by its robust launch pipeline. They highlight the company's strategic land acquisitions in Bengaluru, Chennai, and Hyderabad, with GDVs of Rs 8 billion, Rs 10 billion, and Rs 35 billion, respectively.

The analysts also believe that the company's focus on achieving 100% occupancy by FY24 (currently at 84%) will be key to its success. They foresee a 16% net operating income by FY25, driven by the leasing of vacant spaces in Tech Gardens, Bengaluru, and the full operationalization of the Brigade Twin Towers office project in FY25.

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 Oct 2023
Market closes lower, Plaza Wires' IPO gets bids for 62.6X of available shares

Trendlyne Analysis

Nifty 50closed at 19,436.10 (-92.7, -0.5%), BSE Sensexclosed at 65,226.04 (-286.1, -0.4%) while the broader Nifty 500closed at 17,123.10 (-131.3, -0.8%). Market breadth is highly negative. Of the 1,955 stocks traded today, 535 were in the positive territory and 1,373 were negative.

Indian indices recovered from their day lows but still closed in the red, with the Nifty 50closing at 19,436.1 points. The Indian volatility index, Nifty VIX, fell 1.1% and closed at 11.7 points. Nestle India rose 3% after its board of directors considered a proposal to split its shares, each with a face value of Rs 10. It is also considering a second interim dividend for 2023.

Nifty Smallcap 100 and Nifty Midcap 100 closed lower, following the benchmark index. However, Nifty ITand Nifty FMCG closed higher than their Tuesday’s close. According to Trendlyne's sector dashboard, Commercial Services & Supplies was the top-performing sector of the day as it rose 1.4%.

European indices rebounded and traded higher after opening in the red on a volatile day. However, major Asian indices settled lower than their Tuesday close. US index futures traded flat, indicating a cautious start to the trading session. Brent crude oil futures traded in the red after rising 0.7% on Tuesday.Axis Bank says media reports about the bank planning to raise Rs 10,000 crore via QIP are untrue. The bank adds any fund-raising decision might be taken at the board meeting ahead of the results and the report is purely speculative.

  • Axis Bank sees a short buildup in its October 26 future series as its open interest rises 26.5% with a put-call ratio of 0.4.

  • Metal & mining stocks like Vedanta, Jindal Steel & Power, Steel Authority of India, Tata Steel and National Aluminium Co are falling in trade. All constituents of the broader sectoral index, BSE Metal, are also trading in the red.

  • JPMorgan maintains its ‘Overweight’ rating on HDFC Bank with a target price of Rs 1,900. According to the brokerage, the bank's Q2FY24 earnings are expected to be weak and this weakness will worsen post Q2. It adds that the bank's sequential advances growth momentum has increased to 5% QoQ, and deposits are coming in thick and fast.

  • Reliance Industries' step-down subsidiary, Reliance Brands Holding UK, signs a joint venture (JV) agreement with Superdry. The purpose of the JV is for Superdry to sell its South Asian IP to Reliance for $48.3 million (approximately Rs 401.7 crore).

  • Alembic Pharmaceuticals is falling as flash floods disrupt operations at its Sikkim facility. No loss or harm has been caused to any personnel. The stock shows up in a screener for companies in which mutual funds have increased their shareholdings over the past month.

  • Plaza Wires' Rs 71.3 crore IPO gets bids for 62.6X the available 95 lakh shares on offer on the third day of bidding. The retail investor quota gets bids for 223.8X the available 13.2 lakh shares on offer.

  • Adani Enterprises is rising as Abu Dhabi-based International Holding Company (IHC) raises its stake in the firm to over 5%. This comes just a week after the UAE-based business sold its entire stake in Adani Green Energy and Adani Energy Solutions.

  • HDFC Securities maintains its ‘Buy’ rating on Prestige Estates Projects and raises the target price to Rs 786 from Rs 700. This implies an upside of 27.1%. The brokerage expects sustained demand for housing and office spaces in the long term despite potential rate hikes. It believes the company is well-placed to capitalise on this growing demand, given its robust pre-sales and launch pipeline.

  • Easy Trip Plannerssigns a memorandum of understanding (MoU) worth RS 250 with the government of Uttarakhand. Under the MoU, the company will make joint marketing campaigns with the state to target the American, European and Asian markets.

  • Bajaj Finserv falls as its subsidiary, Bajaj Allianz General Insurance Co, receives a show cause cum GST demand notice of Rs 1,010 crore. The notice was served by the Directorate General of GST Intelligence, Pune. The company appears in a screenerof stocks with declining net cash flow.

  • Suzlon Energy touches a new 52-week high as it releases a pledge on 97.1 crore shares from SBICAP Trustee Co. These shares account for 7.1% of the total equity. It appears in a screener for stocks with strong momentum.

  • Jitendra Adhia, President of Finance at Atul Auto, projects high single-digit margins for FY24. He expects a run rate exceeding 1,000 units per quarter in H2FY24. Adhia is optimistic about Atul Auto’s sales returning to pre-Covid levels during the festive period.

  • Realty stocks like Macrotech Developers, DLF, Oberoi Realty, Mahindra Lifespace Developers and Phoenix Mills are falling in trade. The broader sectoral index, Nifty Realty, is also trading in the red.

  • Nestle India is rising as its board of directors considers a proposal to split its shares, each with a face value of Rs 10. It is also considering a second interim dividend for 2023. The stock shows up in a screener for companies with zero promoter pledges.

  • Polyplex Corp rises as promoters plan to sell a 24.3% stake in the company to its investor, AGP Holdco, for Rs 1,188.9 crore.

  • Pranjul Bhandari, the Chief India Economist at HSBC Securities & Capital Markets (India), says that the current macro environment doesn't favour emerging markets. She notes that the RBI will be cautious about risks. She adds that any change in inflation or growth forecasts by the RBI is not likely.

  • IDFC First Bank's board of directors approves a floor price of Rs 94.9 per share for its qualified institutional placement worth Rs 3,000 crore.

  • Bajaj Finance reports a 33% YoY rise in assets under management (AUM) to Rs 2.9 lakh crore in Q2FY24. This growth is driven by an improvement in new loans booked and deposits. The company appears in a screener of stocks where foreign institutional investors have increased their shareholdings.

  • HDFC Bank's total gross advances (excluding eHDFCL non-individual loans) rise 17.6% YoY to Rs 23,32,800 crore in Q2FY24, while deposits increase by 18.2% YoY to Rs 21,73,000 crore.

  • Siddharth Vasudevan, Managing Director of Vascon Engineers, forecasts a 20% YoY growth in its order book in FY24. He notes that the company’s current order book stands at Rs 2,400 crore, with government projects accounting for 70-75% of the total. He believes the company’s order book will reach close to Rs 4,000 crore.

  • Updater Services’ shares debut on the bourses at a 5% discount to the issue price of Rs 300. The Rs 640 crore IPO has received bids for 2.9 times the total shares on offer.

  • Larsen & Toubro falls despite its power business arm winning an order worth Rs 1,000-2,500 crore from Power Development Corp. The order is for setting up wet flue gas desulphurization systems at the Sagardighi thermal power plant.

  • Rail Vikas Nigamrises as it bags an order worth Rs 444.3 crore from Himachal Pradesh State Electricity Board. The order involves the development of distribution infrastructure for the north zone of the state. The company appears in a screenerof stocks with strong momentum.

  • Titagarh Rail Systemsbags a contract worth Rs 857 crore from the Gujarat Metro Rail Corp to design, manufacture, test and commission 72 standard gauge cars for the Surat Metro Rail project phase-1.

Riding High:

Largecap and midcap gainers today include Adani Wilmar Ltd. (352.80, 5.82%), Avenue Supermarts Ltd. (3,872.95, 3.95%) and Adani Enterprises Ltd. (2,464.95, 3.25%).

Downers:

Largecap and midcap losers today include JSW Energy Ltd. (418.90, -5.35%), Macrotech Developers Ltd. (750.10, -4.85%) and Vodafone Idea Ltd. (11.45, -4.58%).

Movers and Shakers

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

Top high volume gainers on BSE included Adani Wilmar Ltd. (352.80, 5.82%), Avenue Supermarts Ltd. (3,872.95, 3.95%) and The Ramco Cements Ltd. (951.60, 3.78%).

Top high volume losers on BSE were Prince Pipes & Fittings Ltd. (679.30, -2.04%) and GlaxoSmithKline Pharmaceuticals Ltd. (1,560.90, -0.60%).

Mangalore Refinery And Petrochemicals Ltd. (97.85, 2.46%) was trading at 11.5 times of weekly average. HEG Ltd. (1,791.25, 3.27%) and Timken India Ltd. (3,088.50, 0.66%) were trading with volumes 10.4 and 7.3 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 2 stocks hit their 52 week lows.

Stocks touching their year highs included - Bajaj Finance Ltd. (7,854.05, -1.43%), Bank of India (110.00, -2.48%) and Bank of Maharashtra (48.85, -1.31%).

Stocks making new 52 weeks lows included - V-Mart Retail Ltd. (1,969.05, -1.23%) and Adani Total Gas Ltd. (610.70, -0.01%).

7 stocks climbed above their 200 day SMA including Adani Enterprises Ltd. (2,464.95, 3.25%) and Fine Organic Industries Ltd. (4,908.00, 0.88%). 9 stocks slipped below their 200 SMA including Bharat Dynamics Ltd. (979.50, -4.08%) and Gujarat Fluorochemicals Ltd. (2,845.00, -3.21%).

 
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The Baseline
03 Oct 2023
India’s PLI schemes: Is the government’s vision for boosting business a dream or a mirage?
By Abhiraj Panchal

The great hope of the Indian government’s much-celebrated Production Linked Incentive (PLI) schemes is to build powerful, globally competitive businesses across Indian industries Launched as part of the Atmanirbhar Bharat campaign, the PLI scheme hopes to make India a manufacturing powerhouse, through incentives for sales of domestically manufactured products. It encourages both domestic and foreign producers to expand or establish …

PremiumThis is a premium article. Click here to read.

 
Trendlyne Marketwatch
Trendlyne Marketwatch
03 Oct 2023
Market closes lower, Bajaj Auto's total wholesales decline by 1% YoY in September

Trendlyne Analysis

Nifty 50 closed at 19,528.75 (-109.6, -0.6%), BSE Sensexclosed at 65,512.10 (-316.3, -0.5%) while the broader Nifty 500closed at 17,254.40 (-38.2, -0.2%). Market breadth is balanced. Of the 1,985 stocks traded today, 931 were in the positive territory and 1,000 were negative.

Indian indices closed in the red, with the Nifty 50 closing at 19,528.8 points. The Indian volatility index, Nifty VIX, rose by 3% and settled at 11.8 points. The World Bank projected India’s GDP growth to moderate to 6.3% in FY24 from 7.2% in FY23, citing slower global growth and increasing price pressures. It also projected that the headline inflation will average at 5.9% in FY24.

Nifty Smallcap 100 and Nifty Midcap 100 closed up, despite the benchmark settling in the red. Nifty PSU Bank and Nifty Media closed higher than their Friday close. According to Trendlyne's sector dashboard, Healthcare Equipment & Supplies was the top-performing sector of the day as it rose 2%.

Major European indices traded flat or lower, except for England’s FTSE 100 index trading up. However, all major Asian indices closed in the red. US index futures traded flat, indicating a cautious start to the trading session. Brent crude oil futures traded higher after falling 1.8% on a volatile day on Monday.

  • Money flow index (MFI) indicates that stocks like Tata Investment Corp, Gujarat Ambuja Exports, ITI and Union Bank of India are in the overbought zone.

  • Hero MotoCorp is falling despite its total wholesales in September rising by 3.2% YoY to 5.4 lakh units, driven by its motorcycle and scooter sales increasing by 2.9% and 6.3% YoY, respectively. The stock shows up in a screener for companies with high TTM EPS growth.

  • Metro Brands surges more than 10% to touch its all-time high of Rs 1,293 per share. It ranks high on Trendlyne's checklist with a score of 59.1. Trendlyne's Forecaster expects its revenue to grow by 18.9% YoY in FY24. According to Forecasters, the company has a 'Buy' rating from nine out of 14 analysts.

  • PSU Banks like Union Bank of India, Bank of Maharashtra, Punjab National Bank, Indian Bank and Bank of India are rising in trade. All the constituents of the broader index, Nifty PSU Bank, are also trading in the green.

  • HDFC Securities maintains its ‘Reduce’ rating on FSN E-Commerce Ventures (Nykaa) with a target price of Rs 130. This implies a downside of 14.4%. The brokerage cites the firm’s limited monetizing capabilities excluding advertising income for a pessimistic outlook on its prospects.

  • CLSA upgrades its rating on Vedanta to 'Outperform' but slashes the target price to Rs 230. The brokerage believes that the company's plan to demerge into six different entities won't affect operations. This will allow the parent company to bring in strategic investors and reduce its debt burden.

  • Plaza Wires' Rs 71.3 crore IPO gets bids for 20.8X the available 95 lakh shares on offer on the second day of bidding. The retail investor quota gets bids for 92.5X the available 13.2 lakh shares on offer.

  • Valiant Laboratories' Rs 152.5 crore IPO gets bids for 12.4X the available 76.2 lakh shares on offer on the third day of bidding. The retail investor quota gets bids for 9.4X the available 38.1 lakh shares on offer.

  • Escorts Kubota is falling as its total monthly tractor wholesales in September decrease by 11.2% YoY to 10,871 units, caused by an 11.2% YoY degrowth in domestic wholesales. However, its construction equipment sales improve by 51.8% YoY. The stock shows up in a screener for companies with improving net cash flow over the past two years.

  • The World Bank anticipates India’s GDP growth to moderate to 6.3% in FY24 from 7.2% in FY23, citing slower global growth, increasing price pressures and weaker base effects. It also projects that the headline inflation will average at 5.9% in FY24.

  • Tata Motors is falling despite its total wholesales in September rising by 2% YoY to 84,381 units. This growth is led by 12% YoY growth in commercial vehicle sales. But its passenger vehicle sales have fallen by 5% YoY. In Q2FY24, total wholesales grew by 2% YoY, driven by 4% YoY growth in commercial vehicle sales.

  • Man Industries rises to an all-time high of Rs 196.7 as it bags an order worth approx Rs 400 crore from a domestic customer. The order involves the supply of different types of pipes. The company appears in a screener of stocks with improving book value per share.

  • KPI Green Energyis rising as its captive power producer segment bags orders from Shree Parmeshwar Steel and Vivan Steels to produce solar power projects of 4 MW and 3 MW capacity respectively.

  • Rajesh Sharma, MD & CEO of Capri Global Capital, expects a positive Q2 and an even more favourable H2 for the company due to branch expansion. The company plans to open 150 new locations in the following months. He sees solid traction in loans and good collection efficiency and adds that the passing on of higher borrowing costs to clients has not dampened demand.

  • Manoj Vaibhav Gems N Jewellers’ shares make a flat debut on the bourses at Rs 215. The Rs 270 crore IPO has received bids for 2.3 times the total shares on offer.

  • Ambadi Enterprises and Murugappa & Sons, promoters of Tube Investments of India, each sell a 1% stake in the company. They now hold a 45.1% stake each in the company.

  • NMDC rises as it announces iron ore price hike, effective from October 1. The price of both lump ore and fines has been raised by Rs 250 to Rs 5,200 per tonne and Rs 4,460 per tonne, respectively. It appears on a screener for stocks with strong momentum.                           

  • India’s manufacturing PMI drops to a 5-month low of 57.5 in September from 58.6 in August due a softer increase in new orders. The PMI reading, however, stays above the 50-mark for the 27th consecutive month, indicating an expansion in manufacturing activity.

  • Advent International makes changes to the management of Suven Pharmaceuticals after acquiring a 50.1% stake in the company. Advent appoints Vaidheesh Annaswamy, Vetukuri Venkata Naga Kali Vara Prasada Raju and Sudhir Kumar Singh as Executive Chairman, Managing Director (MD) and Chief Executive Officer, respectively. Venkateshwarlu Jasti resigns from the post of MD.

  • NCC is rising as it announces bagging three new projects worth Rs 4,205.9 crore in September. The stock shows up in a screener for companies with book value per share improving over the past two years.

  • Bajaj Auto is falling as its total wholesales decline by 1% YoY to 3.9 lakh units in September. The downturn is due to its two-wheeler sales decreasing by 6% YoY. However, its commercial vehicle wholesales improve by 40% YoY, aided by growth in domestic sales.

  • Indian rupee depreciates 17 paise to Rs 83.21 from the previous close of Rs 83.04 against the US dollar, due to a stronger dollar and a surge in US bond rates, which soared to multi-year highs after the US avoided a possible government shutdown.

  • Maruti Suzuki India's September wholesales rise by 2.8% YoY to 1.8 lakh units. This muted growth is attributed to a decline in wholesales in the mini and passenger cars segments. Its total domestic wholesales and exports increase by 2.5% and 5.2% YoY respectively.

  • JSW Infrastructure’s shares debut on the bourses at a 20.2% premium to the issue price of Rs 119. The Rs 2,800 crore IPO has received bids for 37.4 times the total shares on offer.

  • Kalpataru Projects International rises as it bags orders worth Rs 1,016 crore. This includes a power transmission and distribution order worth Rs 552 crore in India and overseas, and a building and factories order worth Rs 464 crore in India. The company appears in a screener of stocks with strong momentum.

  • Rail Vikas Nigamis rising as it emerges as the lowest bidder, quoting Rs 1,097.7 crore, at an auction held by the Himachal Pradesh State Electricity Board. The auction is for developing electricity distribution infrastructure in the state and is expected to be completed in 24 months.

Riding High:

Largecap and midcap gainers today include Union Bank of India (112.10, 5.46%), Max Healthcare Institute Ltd. (592.80, 4.48%) and Indian Bank (441.30, 4.19%).

Downers:

Largecap and midcap losers today include Oil And Natural Gas Corporation Ltd. (184.60, -3.78%), Gujarat Fluorochemicals Ltd. (2,939.30, -3.63%) and Adani Power Ltd. (366.70, -2.85%).

Volume Rockets

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

Top high volume gainers on BSE included Metro Brands Ltd. (1,265.40, 12.36%), KIOCL Ltd. (329.10, 8.60%) and Mahanagar Gas Ltd. (1,109.10, 7.80%).

Top high volume losers on BSE were Gujarat Fluorochemicals Ltd. (2,939.30, -3.63%), Siemens Ltd. (3,569.65, -2.80%) and Esab India Ltd. (4,951.95, -2.17%).

Kalpataru Projects International Ltd. (649.90, 2.91%) was trading at 31.4 times of weekly average. PNB Housing Finance Ltd. (742.30, 6.94%) and Jyothy Labs Ltd. (368.65, 2.26%) were trading with volumes 18.2 and 11.5 times weekly average respectively on BSE at the time of posting this article.

BSE 500: highs, lows and moving averages

30 stocks made 52 week highs, while 1 stock hit their 52 week lows.

Stocks touching their year highs included - Bayer Cropscience Ltd. (5,436.00, 1.79%), Canara Bank (384.45, 2.18%) and Cholamandalam Investment & Finance Company Ltd. (1,253.80, 2.98%).

Stock making new 52 weeks lows included - Adani Total Gas Ltd. (610.75, -0.41%).

13 stocks climbed above their 200 day SMA including Heidelberg Cement India Ltd. (191.65, 7.04%) and Vinati Organics Ltd. (1,878.70, 1.75%). 6 stocks slipped below their 200 SMA including Gujarat Fluorochemicals Ltd. (2,939.30, -3.63%) and Adani Enterprises Ltd. (2,387.25, -1.10%).

 
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The Baseline
29 Sep 2023
Five Interesting Stocks Today

1. Lupin:

This pharmaceuticals company hit its 52-week high of Rs 1,184.7 on Friday. It has increased by 5.7% in the past month, outperforming its industry. During the month, the company acquired five legacy brands and their associated trademark rights from Menarini for Rs 101 crore. It has also proposed transferring its two active pharmaceutical ingredients (API) manufacturing sites at Dabhasa and Visakhapatnam to its arm, Lupin Manufacturing Solutions, for which it expects to get Rs 750-850 crore. 

In early September, Lupin inked a deal with Mark Cuban Cost Plus Drug Company to improve healthcare accessibility in the US by expanding the availability of tiotropium bromide inhalation powder. In addition, the firm’s arm acquired the entire stake in French pharmaceutical company Medisol for 14.5 million euros. 

In Q1FY24, Lupin reported a net profit of Rs 452.3 crore, as against a loss of Rs 89.1 crore in Q1FY23 (beating Trendlyne Forecaster’s estimate by 84%). Its revenue also increased by 29% (beating estimates by 6.8%), thanks to strong sales growth in India, North America, and EMEA. The company also features in a screener for stocks with good quarterly growth in the recent results. The management expects the company’s robust pipeline of products, such as gSpiriva and diazepam gel, and other key launches like Prolensa to drive earnings growth in FY24 and beyond. 

Axis Securities recommends a ‘Buy’ call on Lupin on the back of new product launches, double-digit growth in its India business, and an improving API business. The brokerage believes that the company’s margin has scope for improvement in the coming quarters as its margins at 13% are still below the industry average of 22%.

2. NBCC: 

Thisconstruction & engineering firm has been making headlines with its recent announcement of selling its property in New Delhi's World Trade Centre for Rs 5,716 crore through an e-auction. It has also secured orders worth Rs 2,000 crore from the Kerala Housing Board. In the past week, the company touched its 52-week high of Rs 63.6 following an order win worth Rs 150 crore from the Khadi & Village Industries Commission. As of September 2023, the company’s order book stands at Rs 45,000 crore. According toTrendlyne Technicals, the company's stock price surged by 15% in the past month. However, the stock’s long-term price change remains volatile. 

NBCC’sQ1FY24 net profit stands at Rs 75.1 crore, as compared to a net loss of Rs 6.3 crore in Q1FY23. However, its revenue growth of 6.6% YoY missed expectations due to weakened performance in the PMC segment and a drop in real estate sales. As a result, the company's EBITDA margin in Q1FY24 fell by 32 bps YoY to 3.2%, primarily driven by increased input costs.

Despite these setbacks, the management is targeting a revenue of Rs 9,000 crore (Rs 8,961 crore in FY23) for FY24. It also expects order inflows ranging from Rs 11,000 crore to Rs 12,000 crore, including an expected Rs 8,000 crore order from Amrapali Housing. NBCC aims to monetise its remaining unsold inventory of Nauroji Nagar (Rs 5,400 crore) and Sarojini Nagar (Rs 1,300 crore), targeting a total of Rs 5,300 crore in FY24. 

Geojit projects that the speed at which NBCC monetises its real estate assets in redevelopment projects will be crucial for top-line growth. The brokerage also believes that tendering activities will continue to play a key role in unlocking revenue potential in the near future.

3. Procter & Gamble Hygiene & Healthcare: 

This personal products company has risen by 4.6% in the past week, following an analyst call on September 22. The stock touched its all-time high of Rs 18,597.9 per share on Friday, helping it enter a screener of stocks with high momentum scores. This uptick is on the back of the management projecting healthy growth in the rural segment. 

Currently, the urban segment accounts for almost 65% of the company’s total revenue, while the rural segment contributes less than 35%. The firm’s management aims to increase sales of brands like Whispers and Vicks Vaporub in the rural segment through educational drives and awareness campaigns. LV Vaidyanathan, Managing Director of the company, said, “We expect mid-single-digit volume growth over the next four to five years, with net profit outpacing revenue growth.” 

Motilal Oswal Financial Services maintains its ‘Neutral’ rating on the stock with a target price of Rs 16,940 per share, after the analyst call. This indicates a potential downside of 5.6%. The brokerage believes the company has an attractive long-term outlook, aided by growth in the feminine hygiene segment and improvement in profitability through premiumisation. However, in the near term, its valuations are high, which explains the downside target. It expects the company’s net profit to grow at a CAGR of 14.3% over FY22-25. Trendlyne’s Forecaster also expects its revenue and net profit to grow by 18.6% and 22.1%, respectively, in FY24.

4. Multi Commodity Exchange of India (MCX): 

This commodity derivatives exchange surged over 8% intraday on Thursday, touching a new 52-week high on Friday. The spike comes after MCX announced a new commodity derivatives platform set to launch on October 3. The platform, which was previously handled by 63 Moons, will be serviced by TCS. MCX dominatesthe commodity derivatives space with a 96% market share and an average daily turnover of approximately Rs 80,000 crore. 

However, a curveball from SEBI on Friday proposes to put the new platform’s launch on hold, causing the stock to tumble by over 2%. The company will continue mock tests while waiting for further directions from SEBI. 

MCX’s share price has risen by 17.2% over the past week till Friday, ahead of the launch. This has helped the company turn up in a screener of stocks with prices above short, medium and long-term moving averages.

HDFC Securities is optimistic about MCX’s growth prospects, citing increased trading volumes and new product launches. It also expects profitability to improve as the company shifts to the new platform, which will cut software support costs. The brokerage maintains its 'Buy' rating and raises the target price by 34.8% to Rs 2,400. 

In Q1FY24, MCX's net profit declined by 52.5% YoY to Rs 19.7 crore due to increased software support charges and product license fees. However, Its revenue grew by 34% to Rs 145.8 crore during the same period, led by an improvement in ADT (average daily turnover) of options contracts. According to Trendlyne’s Forecaster, MCX’s revenue is expected to grow by 14.9% in FY24. 

5. Triveni Turbine:

This turbine manufacturer touched its 52-week high of Rs 456.6 on Thursday and rose by 6.7% from Monday till Friday. This rally comes on the back of a healthy business outlook, driven by increasing demand for energy turbines in domestic and international markets. The company commands a market share of 60% in India’s industrial steam turbine segment. The management is optimistic about achieving strong order inflows in FY24. It expects this growth to be driven by rising exports and aftermarket business (sales of parts and services).

In Q1FY24, Triveni Turbines’ revenue from exports grew by 88% YoY, making up 48% of its overall revenue. The share of exports increased by 11 percentage points YoY. This robust growth trajectory of exports is expected to continue as the company focuses on expanding its sales network and supply chain. According to Trendlyne’s Forecaster, the firm’s revenue and net profit are expected to grow by 34.6% and 37.7% YoY in FY24, respectively. It also shows up in a screener for companies with improving net cash flow over the past two years.

Notably, the company already has the capacity to meet growing demand, eliminating the need for major capex in the coming quarters. Sharekhan expects the firm’s margins to improve on the back of falling raw material costs and a growing aftermarket business. It adds that the firm has no debt and a healthy cash balance of Rs 747 crore, which makes it well-placed to expand into newer markets. The consensus recommendation on the stock from five analysts is ‘Buy’, with four recommending a ‘Strong Buy’ and one calling for a ‘Buy’. 

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
29 Sep 2023
Market closes higher, Plaza Wires' IPO gets bids for 4.7X of the available shares

Trendlyne Analysis

Nifty 50 closed at 19,638.30 (114.8, 0.6%) , BSE Sensex closed at 65,828.41 (320.1, 0.5%) while the broader Nifty 500 closed at 17,292.60 (122.2, 0.7%), of the 1,917 stocks traded today, 1,262 were gainers and 602 were losers.

Indian indices maintained the gains from the afternoon session and closed in the green, with the Nifty 50 closing at 19,638. The volatility index, Nifty VIX, dropped by 10.7% and closed at 11.5 points. Ashok Leyland bags an order for 1,282 fully built buses from the Gujarat State Road Transport Corporation (GSRTC).

Nifty Midcap 100 and Nifty Smallcap 100 closed in the green, following the benchmark index. Nifty PSU Bank and Nifty Healthcare closed higher than Thursday’s closing levels. According to Trendlyne’s sector dashboard, pharmaceuticals & biotechnology emerged as the top-performing sector of the day, with a rise of over 2.6%.

Most European indices trade in the green. US indices futures trade higher indicating a positive start. The data released by Eurostat indicated that the Eurozone CPI inflation for September declined to 4.3% against estimates of 4.5%. The CPI inflation for August stood at 5.2%.

  • Relative strength index (RSI) indicates that stocks like Tata Investment Corp, Gujarat Ambuja Exports, Multi Commodity Exchange of India and Sunteck Realty are in the overbought zone.

  • UNO Minda rises as its board approves the acquisition of an additional 26% stake in its subsidiary, Minda Westport Tech. The acquisition amounts to Rs 14.8 crore, post which UNO Minda's stake will increase to 76%. With this acquisition, the firm aims to include hydrogen & natural gas components and kits for the territory of South Asia. The company appears in a screener of stocks with improving RoCE.

  • Ashok Soota, Chairman of Happiest Minds Technologies, sells a 0.9% stake in the company for approx Rs 115.4 crore in a bulk deal on Thursday.

  • Sharekhan keeps its ‘Buy’ rating on Balrampur Chini Mills and raises the target price to Rs 495 from Rs 425. This implies an upside of 13.3%. The brokerage believes the rising sugar prices and increasing production of ethanol provide earning visibility for the near term. It expects the firm’s net profit to grow at a CAGR of 48% over FY23-25.

  • NLC India is rising as it signs a power purchase agreement with Grid Corp of Odisha for 800 MW.  The company will also be setting up three 800 MW coal-based thermal power plants in the state. The stock shows up in a screener for companies with book value increasing over the past two years.

  • Hindustan Zinc surges more than 5% as it authorises the board of directors to evaluate value unlocking measures. Under these measures, the company plans to create separate legal entities to undertake the zinc & lead, silver and recycling businesses of the company.

  • Telecom equipment, internet & catalogue retail, housing finance and paper & paper products industries rise more than 4% over the past week.

  • Abu Dhabi-based International Holding Co (IHC) decides to offload its stake in Adani Green Energy and Adani Energy Solutions. This move is part of the company's plans to rebalance its overall portfolio.

  • Plaza Wires' Rs 71.3 crore IPO gets bids for 4.7X of the available 95 lakh shares on offer on the first day of bidding. The retail investor quota gets bids for 26.5X the available 13.2 lakh shares on offer.

  • Valiant Laboratories' Rs 152.5 crore IPO gets bids for 2.2X of the available 76.2 lakh shares on offer on the second day of bidding. The retail investor quota gets bids for 3.1X the available 38.1 lakh shares on offer.

  • Federal Bank rises as the Reserve Bank of India (RBI) grants approval to the International Finance Corporation (IFC) for acquiring an aggregate holding of up to 9.7% of the bank's paid-up share capital or voting rights. It appears on a screener for stocks with strong momentum.

  • Foreign institutional investors sell stocks worth Rs 4,603.4 crore in the equity market over the past week, according to Trendlyne's FII dashboard. Meanwhile, index options witness the highest outflow of Rs 37,660.6 crore from foreign investors.

  • Phoenix Millsfalls as its subsidiaries, Offbeat Developers, Market City Resources, and others, receive a show cause-cum-demand notice from GST authorities for Rs 9.2 crore. The notice stems from an investigation into tax liability discrepancies in May 2023. The company appears in a screenerof stocks with declining net profit and margins.

  • According to reports, 10.8 lakh shares (0.14% equity) of IndusInd Bank, amounting to Rs 152.3 crore, change hands in a large trade.

  • Motilal Oswal initiates coverage on Global Health with a ‘Buy’ rating and a target price of Rs 840, implying an upside of 17.4%. The brokerage is optimistic about the company’s prospects due to its execution capabilities, strong brand recall and growth visibility for the near future. It expects the company’s revenue to grow at a CAGR of 14.1% over FY23-25.

  • Sterling and Wilson Renewable Energy rises as it receives an order worth Rs 1,535 crore from NTPC REL in Khavda, Gujarat, for a 300 MWac EPC project with a time frame of three years. It appears in a screener for stocks with increasing net profit and profit margin (QoQ).

  • Godrej Agrovet is rising as it signs a strategic partnership agreement with Sime Darby Plantation Berhad to secure the supply of palm oil seeds and set up a palm oil seed plant in India.

  • Emami is rising as it acquires a 26% stake in Axiom Ayurveda (which houses the beverages brand AloFrut). With this acquisition, the company will foray into the juice category.

  • Pharmaceutical stocks like Glenmark Pharmaceuticals, Aurobindo Pharma, Dr. Reddy’s Laboratories, Lupin and Torrent Pharmaceuticals are rising in trade. The broader sectoral index, Nifty Pharma, is also trading in the green.

  • Ashok Leyland rises as it bags an order for 1,282 fully built buses from the Gujarat State Road Transport Corporation (GSRTC). The company appears in a screener of stocks nearing their 52-week highs with significant volumes.

  • Larsen & Toubro’s heavy civil infrastructure business, L&T Construction, wins an order worth Rs 5,000-7,000 crore from the Mumbai Metropolitan Region Development Authority. The project involves the design and construction of twin road tunnels.

  • Macquarie forecasts robust revenue growth in the cement industry on the back of solid demand. The brokerage maintains a 'Neutral' rating on ACC with an upgraded target price of Rs 2,128. It gives an 'Outperform' rating to UltraTech Cement and Ambuja Cement, while maintaining a 'Neutral' rating on Shree Cements.

  • YES Bankacquires 1.8 crore shares of YES Securities at an average price of Rs 55.7 per share, amounting to Rs 100 crore.

  • Multi Commodity Exchange of India plunges more than 5% as SEBI halts the launch of MCX's Commodity Derivatives Platform due to technical issues.

  • Tube Investments of India declines more than 2% as 20 lakh shares (1% equity), amounting to Rs 586 crore, reportedly change hands in a large trade.

  • Tamilnad Mercantile Bank's Managing Director and Chief Executive Officer Shri S Krishnan resigns citing personal reasons, with effect from Thursday.

  • Likhitha Infrastructure is rising as it bags an order worth Rs 156 crore from Bharat Petroleum. The project involves the laying of a pipeline. The stock shows up in a screener for companies with zero promoter pledges.

  • Saregama India rises as it acquires a 51.8% stake in Pocket Aces for Rs 174 crore. The company plans to acquire another 41% stake over the next 15 months. It appears in a screener of stocks with no debt.

  • Navin Fluorine International's Managing Director (MD), Radhesh Welling, tenders resignation with effect from December 15, citing personal reasons. Executive Chairman Vishad Mafatlal will lead the operations of the company until the board appoints a new MD.

Riding High:

Largecap and midcap gainers today include Vedanta Ltd. (222.55, 6.82%), Hindalco Industries Ltd. (492.65, 5.53%) and JSW Energy Ltd. (437.40, 5.02%).

Downers:

Largecap and midcap losers today include Tube Investments of India Ltd. (2,988.30, -3.72%), Adani Green Energy Ltd. (987.15, -2.50%) and Adani Enterprises Ltd. (2,413.90, -2.48%).

Volume Rockets

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

Top high volume gainers on BSE included Glenmark Pharmaceuticals Ltd. (855.50, 10.11%), Sun TV Network Ltd. (612.15, 5.58%) and NLC India Ltd. (134.95, 5.35%).

Top high volume losers on BSE were Navin Fluorine International Ltd. (3,766.70, -13.56%), Tube Investments of India Ltd. (2,988.30, -3.72%) and Multi Commodity Exchange of India Ltd. (2,049.70, -2.23%).

Eris Lifesciences Ltd. (876.30, 3.08%) was trading at 32.8 times of weekly average. Emami Ltd. (538.45, 5.02%) and Sheela Foam Ltd. (1,141.65, 0.05%) were trading with volumes 6.3 and 6.2 times weekly average respectively on BSE at the time of posting this article.

BSE 500: highs, lows and moving averages

18 stocks made 52 week highs, while 3 stocks hit their 52 week lows.

Stocks touching their year highs included - Aurobindo Pharma Ltd. (914.35, 4.66%), Coal India Ltd. (295.20, 1.72%) and Lupin Ltd. (1,171.25, 3.37%).

Stocks making new 52 weeks lows included - Delta Corp Ltd. (142.70, 1.39%) and Navin Fluorine International Ltd. (3,766.70, -13.56%).

12 stocks climbed above their 200 day SMA including Grindwell Norton Ltd. (2,078.65, 3.80%) and Radico Khaitan Ltd. (1,206.00, 2.77%). 10 stocks slipped below their 200 SMA including Navin Fluorine International Ltd. (3,766.70, -13.56%) and Adani Enterprises Ltd. (2,413.90, -2.48%).