This increasing gas supply from domestic sources should drive earnings growth and valuations for the Indian gas utilities, especially the gas transmission companies. The KGD6 consortium has sought bids from customers as it intends to sell additional 5.5mmscmd of gas from the KGD6 block in the Krishna Godavari (KG) Basin, off the eastern coat of India. The additional gas will be available for sale at the delivery point at Gadimoga, near Kakinada, tentatively from the last week of April or early May 2021. Oil and Natural Gas Corporation (ONGC) has also floated the tender for prospective buyers to bid for gas supplies from its KG-DWN-98/2 field in the KG Basin offshore. The company will supply 2mmscmd of gas from the field to the Odalarevu onshore terminal in Andhra Pradesh, which should commence from June 2021.

Based on the below themes we recommend the following stocks BUY: Gland Pharma, Dr Reddys, Britannia, Wipro, Bharti Airtel, Mind Tree, Dalmia Bharat, ACC, and Dhanuka Agritech

Asian markets are trading in the green tracking cues from Wall Street overnight. Nikkei is trading higher by 2.07%, Hang Seng is trading higher by 0.31% while Shanghai is trading flattish. Indian indices are expected to open lower and focus will be on domestic quarterly earnings. Sgx Nifty was tradi

In the first fortnight of April'21, economic activity began to feel the pinch of the second wave of Covid-19 even though the impact was marginal. The number of active Covid cases rose by 166.4% from the previous fortnight while the number of deaths was up by 195%, both witnessing the sharpest increase since Apr'20. Meanwhile, the pace of vaccination is picking up, but it is yet to reach critical mass, with less than 1.5% of the population fully vaccinated. As of 19 April, 2021, only ~16.48mn people were fully vaccinated. But, a total of ~123.85mn people have received at least one dose of the vaccine. Mobility indicators witnessed a sharp slowdown across the board, with movement for essential services being the most resilient. Movement for retail and recreation and use of public transport retreated to levels last seen in Oct'20 while workplace movements are back to levels last seen in Sept'20. The TomTom New Delhi traffic congestion index has also retreated to levels last seen in July'20. The urban unemployment rate rose to 8.5% from 7.2% due to...

Base led buoyancy but innate weakness persists

High growth due to base effect; expect FY22 to be strong For Mar'21, the private sector has reported very strong set of numbers, with individual APE growing by 90% YoY, partially aided by a low base. Note that Mar'20 was affected due to the beginning of national lockdown and hence new business generation was also adversely impacted. For FY21, private sector individual APE grew by 7.5% compared to a growth of 4.8% in FY20. We have seen the momentum pick-up significantly in 2HFY21, thus setting the stage for strong growth in FY22. Overall sector (including LIC) has reported a growth of 3% in FY21 (LIC down 3.2%). For Mar'21, LIC has reported individual APE growth of 196% YoY on account of a low base. Total number of policies sold by the private sector in Mar'21 is up...

Asian markets are trading mixed amid reports that China kept the one-year loan prime rate (LPR) and five-year LPR unchanged at 3.85% and 4.65%, respectively. Nikkei is trading lower by 1.84%, Hang Seng is trading lower by 0.14% while Shanghai is trading higher by 0.12%. Indian indices are expected t

We initiate coverage on the sector with the hope that a revival would take place, given these reforms could improve the discoms efficiencies and financials. We initiate our positive stance on NTPC, PGCIL, CESC, Tata Power, Torrent Power and NHPC, based on their risk averse regulatory business models, growth opportunities, healthy balance sheets and attractive valuations (~0.7x FY23 BV). While the demand for power had been impacted by the pandemic in 1HFY21, its revival has been far exceeded everyones expectation. H2FY21 saw 7.5% yoy growth in both demand and generation, which curbed the FY21 decline in power demand to only 1%. We expect FY22 to witness 12% yoy growth in demand and generation, led by recovery across the economic activities and low FY21 base. However, the pandemic has further aggravated the ailing financial status of the discoms, resulting in a steep rise in discom dues towards the gencos (scaling a new peak of INR1.4tn in Jan21) and eventually a sharp rise in its borrowings. While the proposed reform measures like the Draft Electricity Amendment Bill will act as a silver lining towards reviving the sector, its successful implementation remains a key trigger to watch out for.

Sequential improvement in demand and lower base to augur well We expect 4QFY21 earnings for Auto & Auto Ancillary to witness sequential growth driven by healthy volume recovery and cost control measures. Pent-up demand, increased preference for personal mobility and strong rural sentiments has enabled to revive the sector. Ramp-up in production post unlocking measures has helped to fill channel inventory. Tractor, PV and 2W OEMs witnessed good pent-up demand, aided by strong rural and semi-urban markets. CV segment is gradually witnessing a recovery led by increase in construction activities and national infrastructure projects. All such factors are expected to leverage the operational performance of OEMs. However, most of them have taken a price hike across their models to mitigate the risk of commodity costs. Going ahead, the rising case of covid-19 and stringent lockdown measures can impact the overall sales in near term....

Benchmark Singapore GRMs, have increased from low levels of initial phase of Covid-19 spread and were at US$1.8/bbl in Q4FY21. Singapore GRMs are less relevant now as low grade fuel oil is a significant component of benchmark. For Indian refiners, spreads of gas oil, gasoline and jet fuel are more important. Spreads of all three products saw recovery QoQ during the quarter. The spread for gas oil increased by US$1.1/bbl from US$3.6/bbl to US$4.7/bbl while gasoline product spreads increased by US$3.2/bbl to US$7.2/bbl. Jet fuel spreads saw recovery of US$0.9/bbl to US$3.3/bbl....

in speciality chemical segment and healthy growth in the pharma segment. With improved product mix and additional compensation income from the canceled contract, EBIDTA margin likely to improve by 404bps to 24.4% from 20.3% in Q4FY20. The net profit expected to grow by 85% at...

decent demand offtake, owing to sales events and declining Covid cases, a sudden rise in the number of Covid cases in the past few weeks has dampened the growth picture for FY22 for retail companies. Retail companies could be looking at a slump in demand in 1HFY22 compared to earlier expectations as partial lockdowns, closure of malls and curbs on late evening movement keep consumers home-bound. The earlier expectation that the companies would return to normal business by 1HFY22 has been dashed. However, we believe that with the vaccination drive underway, the retail sector will be back in good shape by 2HFY22. One should keep in mind that 4QFY20 was a weak quarter as sales got impacted towards the second half of March 2020, which is traditionally a sales heavy part of the quarter....

The stock has indicated a breakout above the channel pattern in the daily chart at 500 levels and has improved the bias with consecutive positive bullish candle and moving ahead. Currently the RSI indicator is also going strong and is well placed and with the chart looking promising, we anticipate an upside movement in...

The stock has indicated a breakout above the channel pattern in the daily chart at 500 levels and has improved the bias with consecutive positive bullish candle and moving ahead. Currently the RSI indicator is also going strong and is well placed and with the chart looking promising, we anticipate an upside movement in...

Asian markets are trading in the green tracking cues from Wall Street overnight. Nikkei is trading higher by 0.15%, Hang Seng is trading higher by 1.05% and Shanghai is trading higher by 1.10%. Indian indices are expected to open lower. Sgx Nifty was trading lower by 1.20%.

We also have a BUY rating on Maruti Suzuki due to the sustained demand for PVs, given the shift towards personal mobility. After the initial outperformance by the auto stocks, the sector returns are converging with those of the broader market due to moderating domestic growth trends across 2Ws and commodity-based inflation. OEMs expect an impact of ~300bps due to the rising base metal prices, which will limit the extent of margin expansion from improving leverage (as demand normalises over FY22-23E). Amidst this backdrop, we prefer stocks that have a diversified revenue model such as Tata Motors, Bharat Forge, and Bajaj Auto.

While we expect margins for even pipes companies to marginally compress QoQ, it should remain strong YoY. We maintain our BUY on Kajaria Ceramics (TP INR 1,010) and ADD ratings on Astral Poly Technik (TP INR 1,660) and Supreme Industries (TP INR 2,045). We expect tiles and plastic pipes companies to deliver strong performance YoY, aided by both base effect (COVID-lockdown had impacted 4QFY20 volume and profits) and healthy overall demand across both the segments. Tiles companies could affect some price hikes to moderate the impact of surge in gas prices on EBITDA margin QoQ. However, we expect EBITDA margin to remain strong YoY. Similarly, for pipes companies, plumbing demand has remained healthy during the quarter while rising PVC prices have impacted the price-sensitive agri demand

Growth over two years has come at the cost of deteriorating unit economics as (1) reliance on online channel continues to increase (pricing power could get compromised with time) and (2) footfalls/store have consistently reduced. All discretionary categories hit growth; devil lies in nuances: Our discretionary universe is expected to clock 27/48% revenue/EBITDA growth YoY (on a low base) in 4QFY21 as increased consumer mobility/pent-up demand in metros/Tier 1 cities helped OOH categories such as jewellery/apparel and paints. On a two-year basis, F&G; (ex-RR)/jewellery/paints/apparel (ex-RR) are expected to deliver 20/24/11/-3% CAGR. However, devil lies in nuances, especially for apparel retail.

Refer to important disclosures at the end of this report Healthy credit appetite, but lenders to turn cautious as lockdowns intensify We hosted a call with Mr. Kaushik Mehta, Founder and CEO of RULoans Distributions, one of the largest DSAs, to discuss the recent business trends in retail loans and to gauge the impact of recent localized lockdown, if any. Retail credit appetite remains healthy, but lenders turning cautious could hurt business in the near term: As per Mr. Mehta, credit demand accelerated last year in...