1. InterGlobe Aviation (Indigo): This airline stock surged more than 7% even after it posted a loss in Q4FY22. IndiGo’s net loss rose  47% YoY to Rs 1,681 crore because of a 68% YoY surge in fuel costs to Rs 3,220.5 crore. The positive stock movement after the results was because of CEO Ronojoy Dutta’s positive outlook for the company. He said that profitability is a top priority, and also hinted at a hike in ticket prices. The CEO believes the key to profitability is managing the business well on the revenue side. It’s important to note that IndiGo has over 50% market share in India’s commercial aviation market, ending Q4 with a market share of nearly 59%.

The company’s revenue rose in Q4FY22 by 28.9% to Rs 8,020.7 crore. But due to high aviation turbine fuel (ATF) costs the EBITDA margin fell 8.3 percentage points to 2.1%. The increase in ATF costs was much higher than the rebound in demand for air travel.

However, it will be interesting to see how IndiGo fights to maintain its market share as Air India and SpiceJet expand flight operations. IndiGo also faces threats from new entrants like Akasa, and Jet Airways. With a volatile and bearish market, brokerage JM Financial expects the stock to remain under pressure because of increasing competition, margin pressure due to the rise in ATF prices, and Rakesh Gangwal’s decision to reduce his 36.6% stake in the company.

2. ICICI Lombard General Insurance: This general insurance company’s stock fell over the past week after reports came in early in the week that the insurance regulator is considering a move to allow life insurers to sell health insurance products. The stock rebounded back and outperformed its industry over the past three months. This outperformance was probably due to another regulatory action that would lead to higher motor insurance premium for general and health insurers. The Ministry of Road Transport and Highways issued a notification on that will lead to an increase in third-party motor insurance premium for various categories of vehicles. The underwriting and claims head of the company considers this a positive step as premiums will rise as motor insurance premium rates were stagnant for the last two years.

The company’s net profit in Q4FY22 fell 9.2% YoY to Rs 313 crore even though its gross direct premium income (GDPI) rose 34.2% YoY to Rs 4,666 crore. The management attributes the fall in profit to a rise in claims and underwriting losses due to the pandemic. Underwriting losses rose 128% to Rs 308.9 crore. Maximum underwriting loss was in the health segment with the retail health insurance segment’s losses growing 4.8X to Rs 50.7 crore.

While the company faced underwriting losses in the health insurance segment, the product mix for health insurance stands unchanged at 22%, the same as FY21. Motor insurance share in the total product mix decreased to 46% in FY22 since the auto sector was on a slowdown the entire FY22.

3. Torrent Pharmaceuticals: This pharmaceutical company’s stock rose by 10.2%, despite posting a loss of Rs 118 crore in Q4FY22 as opposed to a profit of Rs 324 crore in Q4FY21. The stock rose significantly after the company declared a final dividend of Rs 23 per share, with the total payout amounting to Rs 389.2 crore. The company’s board also recommended issuing bonus shares in the ratio of 1:1 or one share for each fully paid-up share held. The company declared a dividend despite its net profit falling 37.9% YoY to Rs 777 crore in FY22. Its cash flow from operations and trade receivables marginally increased compared to FY21. 

The stock is also currently in the PE ‘Sell Zone’, according to Trendlyne’s Check Buy or Sell feature.. This means the stock is trading at higher PE levels than normal. The stock has remained below its current PE levels 90.7% of the time.

The company’s revenue rose 10% YoY, driven by strong growth momentum in branded generic markets in India and Brazil. Going forward, the management guided for a 100-150bps EBITDA margin improvement in FY23 compared to 28.6% in FY22. It expects the improvement to be driven by the closure of its liquid business, cost optimization measures, and favourable pricing in the branded generics segment.

4. National Aluminium Company (Nalco): This aluminium company’s stock closed 0.7% lower on Thursday, even though its Q4FY22 net profit rose 9.6% YoY to Rs 1,025.5 crore. The company’s profit marginally missed Trendlyne’s Forecaster estimates. The company’s revenue rose 53.8% YoY to Rs 4,340.8 crore in Q4FY22, driven by high LME (London Metal Exchange) prices, and effective raw material procurement according to the management. In FY22 the company produced 4.6 lakh tonnes of aluminium and 75.1 lakh tonnes of bauxite, its highest ever since its inception, according to the management.

Interestingly, this stock showed on a screener which tracks big changes in FII (foreign institutional investors) holding in companies on a quarterly basis. FII holding in the company increased by 4.7 percentage points QoQ to 18%. By far, Nalco saw the biggest jump in FII holding compared to other key aluminium players such as Hindalco (+2.8 percentage points QoQ) and Vedanta (+0.7 percentage points QoQ).

Even as aluminium prices have corrected nearly 30% from record highs during Q4FY22, the Managing Director of Nalco expects to keep up the growth momentum by increasing production and reducing raw material costs. As the company has been allocated two coal mines namely Utkal D and E, the management expects the cost of procuring coal to gradually reduce from FY24. For the coming quarters, the management expects aluminium to stabilise as it sees the gap between global production of aluminium and consumption narrowing down.

5. Aster DM Healthcare: This healthcare service provider’s stock rose over 13% intraday after it announced its Q4FY22 results on Wednesday. Its net profit jumped 2.2X YoY to Rs 226.3 crore and revenues increased by 14.1% to Rs 2,727.8 crore. Revenue rose on the back of a 26.2% YoY growth in its India businesses. EBITDA margin rose 360 basis points YoY to 17% mainly due to a decrease in its laboratory outsourcing costs, which fell 61% YoY to Rs 54.8 crore. This stock shows up on a screener that lists companies that announced results in the last two weeks, with rising operating profit margin and YoY profit growth.

Aster DM gets a majority (77%) of its revenues from Gulf Cooperation Council (GCC) countries and the remaining 23% from India. However, the company is focusing more on expanding its network in India as its India business is growing faster. Revenue from GCC rose 11% YoY to Rs 2,121 crore while revenue from India increased by 26.2% to Rs 607 crore in Q4FY22. This is reflected in the average occupancy rate (AOR) as well. AOR of hospitals in GCC fell 100 bps YoY to 51% in FY22 while ARR of hospitals in India rose 10 percentage points to 66%. The company plans to add up to 1,000 beds in India in FY23, indicating a 25.6% increase.

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