KEY HIGHLIGHTS
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HCL Tech Climbs Over 5% On Munich Re Contract
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Bloomberg Exclusive: India Is Said To Plan Rs 6 Lakh Crore Of Infrastructure Asset Sales
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Arvind Fashions Hits 52-Week High After Raising Rs 439 Crore From Investors
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Nuvoco Vistas Lists At 15% Discount On The NSE
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Aurobindo Pharma Advances The Most In Over 3 Months
Closing Bell
India’s stock benchmarks closed higher after a volatile session, snapping a two-day losing streak, helped by technology stocks.
The S&P BSE Sensex rose 0.41% to 55,555.79. The NSE Nifty 50 advanced 0.28% to 16,496.45. Tata Consultancy Services Ltd. contributed the most to the index gain, increasing 2.2%. HCL Technologies Ltd. had the largest increase, rising 4.1%.
The broader indices underperformed their larger peers with the S&P BSE MidCap slipping 1% and the S&P BSE SmallCap shedding 1.65%. Twelve out of 19 sectoral indices compiled by the BSE Ltd. declined, with S&P BSE Basic Materials falling 1.5% and S&P BSE Auto shedding 1.25%. On the flipside, S&P BSE Teck and S&P BSE Information technology added over 1%.
The market breadth was skewed in favour of bears. About 786 stocks advanced, 2,464 declined and 143 remained unchanged.
"Considering improved visibility of sustained earnings recovery in subsequent quarters, a meaningful correction in quality midcap names should be bought. As Federal Reserve intends to reverse its ultra-soft monetary policy by the end of this year, liquidity driven market rally might take a backseat and therefore investors should be advised to focus on quality companies with strong fundamentals. We note higher government’s capex and revival in industrials’ capex should aid economic recovery", Mr. Binod Modi, Head Strategy at Reliance Securities wrote in a note.
BSE To Investors: Refrain From Dealing In Unregulated Products Like CFDs/Binary Options
Noticed some unregulated platforms/ websites offering trading in certain unregulated derivative products called Contracts for Difference (CFDs)/Binary Options.
Investors falling prey to the promises of exorbitant returns by these platforms may eventually lose money heavily.
Advise investors to refrain from dealing/investing in unregulated products such as Contracts for Difference (CFDs)/ Binary Options offered by such unregulated internet-based trading platforms.
Source: BSE Media Release
Aditya Birla Capital Slips The Most In Nearly 5 Months
Shares of Aditya Birla Capital Ltd. fell 8.05%, the steepest decline in nearly five months, to Rs 100 apiece.
Trading volume was 4.27 million shares, 44% above the 20-day average of 2.96 million shares for this time of the day.
The relative strength index on the stock was below 30, indicating that it may be oversold.
Analysts have 9 ‘buy’, no hold and no sell recommendations on the stock. The overall consensus price of analysts tracked by Bloomberg implied an upside of 43%
Escorts Gains Over 9%; Outperforms Peers
Shares of Escorts Ltd. gained over 9%, the most in almost a year, to Rs 1,303.40 apiece.
Trading volume was 1.52 million shares, 50% above the 20-day average of 1.02 million shares for this time of the day. Escorts outperformed its peers in S&P BSE Auto index in which 12 of the 15 constituents declined.
Of the 25 analysts tracking the company, 17 maintained 'buy', 5 maintained 'hold' and 3 analysts maintained 'sell' recommendations with 7 analysts revising their target prices higher over the past month. The overall price consensus of analysts tracked by Bloomberg implied an upside of 7.6%.
Citi, BofA, Goldman Among Banks Vying To Manage India's LIC IPO
BNP Paribas, Citigroup, BofA Securities and Goldman Sachs are among seven foreign banks vying to manage the Indian govt’s initial public offering in state-run Life Insurance Corp., according to a presentation schedule.
The banks will make presentations on their bids on Tuesday; HSBC, JPMorgan and Nomura are the other banks making presentations Tuesday.
Nine local banks, including Axis Capital, Kotak Mahindra and HDFC Bank, will make presentations on Wednesday.
HCL Tech Climbs Over 5% On Munich Re Contract
Shares of HCL Technology gained 5.45% to hit 52-week high of Rs 1,178.20 apiece after it bagged a contract with one of the world's leading reinsurers, Munich Re
HCL Technologies Ltd. signed contract with Munich Re to create next-generation digital workplace for its workforce.
HCL Tech will now modernize and standardize workplace services for more than 16,000 employees in 40 countries.
HCL Tech selected as Munich Re's preferred partner.
HCL Tech's WorkBlaze solution will provide predictive analytics and AI for tech operations capabilities.
Source: Exchange Filing by HCL Technologies
Of the 48 analysts tracking the company, 41 maintained 'buy', 4 maintained 'hold' and 3 maintained 'sell' recommendations. The overall consensus price of analysts tracked by Bloomberg implied a downside of 0.4%. The relative strength index on the stock was 76, implying that it may be overbought.
Bloomberg Exclusive: India Is Said To Plan Rs 6 Lakh Crore Of Infrastructure Asset Sales
India plans to raise Rs 6 Lakh Crore ($81 billion) from selling state-owned infrastructure assets over next four years to help bolster the government's finances and plug its budget deficit.
Plan will include sale of road and railway assets, airport, power transmission lines and gas pipelines.
Planned sales are in-line with PM Narendra Modi's strategic divestment policy.
Source: People familiar with the matter
Finance Minister Nirmala Sitharaman is scheduled to make the details of the infrastructure asset sales plans public later today.
HDFC Bank Aims To Issue 3 Lakh Credit Cards Per Month
HDFC Bank detailed its plans to regain lost card market share in 3-4 quarters. In a media briefing, Parag Rao, Group Head – Payments, Consumer Finance, Digital Banking & IT said that the bank would ramp up the issuing of credit cards.
Want to immediately start issuing 3 lakh credit cards per month.
Did not lose out on market share during the embargo.
Want to raise runrate to 5 lakh cards a month in a couple of quarters.
Have a portfolio of more than 20 initiatives, which we will bring to the table.
Will partner with multiple service providers for these initiatives.
Will be launching these initiatives in 6-9 months.
Source: HDFC Bank media briefing
Mid-Day Market Update: Sensex, Nifty Edge Higher In Volatile Session Aided By Tech Stocks
India’s stock benchmarks rebounded in a volatile session, aided by gains in tech stocks which offset the losses in auto and consumer durables stocks.
The S&P BSE Sensex rose 0.34% to 55,515.91. The NSE Nifty 50 advanced by similar magnitude to 16,495.55. Tata Consultancy Services Ltd. contributed the most to the index gain, increasing 2.5 percent. HCL Technologies Ltd. had the largest increase, rising 3.8 percent.
The broader indices underperformed their larger peers with the S&P BSE MidCap shedding 0.6% and the S&P BSE SmallCap slipping over 1.2%. Eleven out of the 19 sectoral indices compiled by the BSE Ltd. declined, with S&P BSE Consumer Durables and S&P BSE Basic Materials falling 1%.
The market breadth was skewed in favour of bears. About 743 stocks advanced, 2,393 declined and 128 remained unchanged.
Indian Bank Falls Most In Nearly 8 Weeks
Shares of Indian Bank declined 5.38%, the steepest fall in nearly 8 weeks, to Rs 115.10 apiece.
Trading volume was 2.23 million shares, double the 20-day average of 1.07 million shares for this time of the day.
Relative strength index on the stock was below 30, indicating that it may be oversold. Shares of Indian Bank have added 40.79% in 2021 so far compared to 27.65% gains for NSE Nifty PSU Bank index.
Analysts have 11 buy, no hold and no sell recommendations on the stock. The overall consensus price of analysts tracked by Bloomberg implied an upside of 59.8%.
TRAI Data: Jio Adds 55 Lakh Mobile Customers In June
Reliance Jio added net 55 lakh mobile customers in June.
Bharti Airtel added net 38 lakh mobile customers in June.
Vodafone Idea lost net 43 lakh mobile customers in June.
Source: TRAI Data
Mangalore Refinery & Petrochem Seeks Shareholders' Nod To Raise Rs 5000 Crore
Mangalore Refinery & Petrochemicals Ltd has sought the approval of shareholders to raise funds up to Rs 5,000 crore through issue of non-convertible debentures (NCDs)/Bonds.
The issue will be taken up on the 33rd Annual General Meeting of shareholders scheduled on September 4.
Arvind Fashions Hits 52-Week High After Raising Rs 439 Crore From Investors
Shares of Arvind Fashions advanced over 10% to a 52-week high of Rs 265 apiece. The company had approved the preferential allotment of equity shares worth Rs 439 crore to various marquee investors, as per Sebi regulations, according to an exchange filing by Arvind Fashions on Saturday.
The marquee investors who partipicated in the fund raise are Akash Bhanshali, ICICI Prudential Mutual Fund, University of Notre Dame Du Lac, GP Emerging Markets Strategies L.P., The Ram Fund L.P., Ashish Dhawan and a promoter entity, Aura Merchandise Pvt Ltd.
Arvind Fashions said that the fund raise completed the capital requirement needed for the growth and it is unlikely that the company would require any more funding in the near to medium term.
The relative strength index on the stock was 72, suggesting that it may be overbought. Shares of Arvind Fashions added 73.4% in 2021 so far as compared to 17.1% for S&P BSE Sensex index.
Zomato Falls 7% As Lock-In Period On Anchor Shares Ends
Shares of Zomato Ltd. fell the most in three weeks as the mandatory one-month lock-in period on the shares that were allotted to anchor investors during the food delivery company’s July IPO ended today.
Shares declined 7.18%, most since July 30, to Rs 129.30 apiece.
Analysts have 5 ‘buy’, 2 ‘sell’ and no hold recommendations on the stock with ICICI Securities initiating coverage on the stock with a 'buy' rating on Sunday.
ICICI Securities
Initiates coverage on the stock with a 'buy' recommendation, with the target price at Rs 220, an implied upside of 60.58%.
Channel checks at 150+ restaurants in 16 cities strengthens the conviction that industry will remain a duopoly.
Zomato is one of the least vulnerable internet companies across the world for a regulatory tech-lash.
Optimisation of the delivery will be a key driver of rise in contribution.
Food-tech adoption at 16% in the Next-500 towns an encouraging factor that could trigger growth.
Ujjivan SFB Falls Nearly 10% To Record Low
Shares of Ujjivan Small Finance Bank Ltd. shed nearly 10% to a record low of Rs 17.80 apiece. The company’s shares declined 18.76% on Friday after the managing director and CEO Nitin Chugh resigned. The resignation will be effective from September 30.
Of the 18 analysts tracking the company, 10 maintained ‘buy’, 5 maintained ‘hold’ and 3 maintained ‘sell’ recommendations with 11 analysts revising target price lower over the past month. The consensus analyst recommendation fell from buy to hold today. The overall consensus price of analysts tracked by Bloomberg implied an upside on 60.2%.
Relative strength index of the stock was at 8, indicating that the stock may be oversold.
Capacit’e Infraprojects Tumbles On Ratings Downgrade
Shares of Capacit’e Infraprojects Ltd. hit 20% lower circuit, to Rs 159 apiece after India Ratings & Research downgraded the long-term issuer rating of the company from ‘IND A’ to ‘IND D’.
The company issued clarification on the rating provided by Ind-Ra on Sunday and stated that it had an operational order book in excess of Rs 8,800 crore as on June 30, 2021, from marquee clients and assured the stakeholders of its commitment to be debt free by FY23.
All the 9 analysts tracking the company maintained ‘buy’ recommendation. The relative strength index on the stock was 25, suggesting that it may be oversold.
S&P BSE SmallCap Index Slips Nearly 2%
Gujarat State Petronet Slips The Most In 17 Months
Shares of Gujarat State Petronet Ltd. declined 7.6%, the most in 17 months, to Rs 345.80 apiece.
Trading volume was 4,01,327 shares, 88% of the 20-day average of 4,53,912 shares for this time of the day.
Of the 33 analysts tracking the company, 28 maintained 'buy', 3 maintained 'hold' and 2 maintained 'sell' recommendations, with 15 analysts revising their price targets higher over the past month. The overall consensus price of analysts tracked by Bloomberg implied an upside of 9%.
Tech Stocks Advance
Tech stocks gained in trade with NSE Nifty IT index leading the sectoral gains.
Nine out the 10 constituents advanced with Oracle Financial Services Ltd. being the only exception.
Mphasis, HCL Technologies and Mindtree added over 3% with Tech Mahindra, TCS, L&T Infotech and Wipro gaining over 2%.
Nuvoco Vistas Lists At 15% Discount On The NSE
Indian cement maker Nuvoco Vistas Corp. listed at Rs 485 on the NSE, a discount of 15% to its issue price of Rs 570 .
Affle India Slips The Most In Nearly 8 Weeks
Shares of Affle India Ltd. fell over 3.5%, the steepest decline in nearly 8 weeks, to Rs 3,861.00 apiece.
The board of directors of the company will consider and approve the split of equity shares in their meeting on Thursday, according to exchange filings by the company.
Trading volume was 12,759 shares, triple the 20-day average for this time of the day.
Relative strength index on the stock was below 30, suggesting that it may be oversold.
Analysts have 4 'buy', 2 'hold' and no sell recommendations on the stock.
Adani Total Gas Locked In 5% Upper Circuit
Shares of Adani Total Gas Ltd were locked in 5% upper circuit at Rs 1,126.45 apiece after the company announced that it would buy 50% stake in Smartmeters technologies for Rs 1 crore, post market hours Friday.
The acquisition is expected to be completed by September 2021.
This is the fourth consecutive session in which the Adani Total shares hit 5% upper circuit. The relative strength index on the stock was 72, indicating that it may be overbought. Shares of Adani Total have advanced 200% in 2021 so far.
Aurobindo Pharma Advances The Most In Over 3 Months
Shares of Aurobindo Pharma advanced over 6.5%, the steepest intraday gain in over three months, to Rs 726.20 apiece after the company announced the termination of binding agreement to buy 51% of stake in Cronus Pharma Specialities post market hours Friday.
The board of directors approved the termination of the deal and the parties have mutually agreed to terminate the agreements, according to exchange filings by Aurobindo Pharma.
Of the 31 analysts tracking the company, 25 maintained ‘buy’, 3 maintained ‘hold’ and 3 maintained ‘sell’ recommendations, with 22 analysts revising their target price lower over the past month. The overall consensus price of analysts tracked by Bloomberg implied a return potential of 33.5%.
The relative strength index on the stock was 21, suggested that it may be oversold. Shares of Aurobindo Pharma shed over 22% in 2021 so far.
Cadila Health Climbs On Covid Vaccine Nod
Shares of Cadila Healthcare Ltd. rose nearly 8% to Rs 577.00 apiece after India's drug regulator gave emergency use authorisation to a Covid-19 vaccine candidate developed by the company.
The DNA-based vacccine will be administered to all above 12 years of age, Ministry of Science and Technology said on Friday. ZyCoV-D, developed domestically by Zydus Cadila in partnership with India's Department of Biotechnology, is the sixth vaccine to receive emergency use approval in India.
Managing Director of the company, Sharvil Patel said that the company planned to produce up to five crores doses of the vaccine by January 2022.
The company also received final approval from the U.S. FDA to market Tofacitinib extended-release tablets, 11 mg and 22 mg in the United States. Zydus was the first ANDA filer on the Tofacitinib extended-release tables 22 mg and currently holds 180-day exclusivity. The drug is used to treat some types of arthiritis and ulcers. The drug had annual sales of approximately $2,082 million in the United States for the year ending June 2021, according to IQVIA data.
Of the 35 analysts tracking the company, 17 maintained 'buy', 8 maintained 'hold' and 10 maintained 'sell' recommendations with 15 analysts revising the price targets over the past month. The overall consensus price of analysts tracked by Bloomberg implied an upside of 6.6%.
Opening Bell: Sensex, Nifty Gain Amid Positive Asia Trade
India’s stock benchmarks snapped a two-day losing streak and advanced, aided by gains in metal stocks, amid positive global cues.
The S&P BSE Sensex rose 0.73% to 55,734.56. The NSE Nifty 50 advanced by similar magnitude to 16,553.50. Reliance Industries Ltd. contributed the most to the index gain, increasing 0.8 percent. HCL Technologies Ltd. had the largest increase, rising 2.7 percent.
The broader indices almost mirrored their larger peers with both the S&P BSE MidCap and the S&P BSE SmallCap gaining over 0.7%. All the 19 sectoral indices compiled by the BSE Ltd. advanced, with S&P BSE Metal adding 1.3%.
The market breadth was skewed in favour of bulls. About 1,701 stocks advanced, 625 declined and 90 remained unchanged.
Adani Group Shares In Focus
Adani group company shares will be in focus after the securities regulator put a proposed $605m initial public offering of its food venture with Wilmar International on hold.
Separately, Wilmar International said there’s no assurance the share sale will proceed and advised caution; Wilmar shares fell as much as 1.9% in Singapore to the lowest level since December 11.
Stocks In Focus: Adani Enterprises, Adani Ports, Adani Power, Adani Transmission, Adani Green, Adani Total Gas.
Vegetable oil companies’ stocks Ruchi Soya, Agro Tech Foods also in focus.
Rupee Bonds May Drop as Traders Assess RBI Minutes
India bonds may open lower as traders are likely to deem the central bank’s minutes released on Friday as more hawkish than the policy. The rupee may gain in line with other emerging Asian peers.
The August minutes were more hawkish than the policy itself, with dissenter Jayanth Varma as well as Mridul Saggar and Ashima Goyal arguing that (liquidity/policy) normalization and accommodation can co-exist, Madhavi Arora, lead economist at Emkay Global Financial Services, wrote in a note.
The growth narrative was largely similar across, with members agreeing on the need for durable growth, but some splits emerged on persistent inflation risks.
Oct. MPC meeting may see a more active debate on the definition/pace/mode of accommodation. In term of variable rate reverse repos, the RBI is expected to either increase the amount or extend the tenor, but it will be simply reckoned as the normalization of liquidity skewness. Unlikely to hike reverse repo rate this year and expect the RBI to maintain its preference for curve flattening.
Indian officials are set to detail a plan Monday aimed at raising money from the sale of state infrastructure assets over four years as Prime Minister Narendra Modi seeks to bolster the government’s finances and rein in a widening budget deficit.
India will convert Rs 10,000 crore ($1.3 billion) of bonds into longer-term debt via switch auction on Aug. 23, the central bank said in a statement on its website.
Govt will convert five bonds maturing in 2022 and 2023 into securities due 2031 and 2035.
USD/INR rose 0.2% to 74.3963 on Friday.
10-year yields up 1bps at 6.23% on Friday.
State-run banks bought Rs 1,830 crore of sovereign bonds on Aug. 20: CCIL data. Foreign banks sold Rs 1,710 crore of bonds.
SGX Nifty Hints At Gains; Adani Enterprises, BPCL, Cadila Health In Focus
Asian stocks rose early Monday as traders sought to take advantage of last week’s selloff while weighing risks from the delta virus strain and China’s regulatory curbs. The dollar was firm. Shares climbed in Japan, South Korea and Australia. U.S. equity futures edged higher after an advance in the S&P 500 and tech-heavy Nasdaq 100 at the end of last week.
India’s SGX Nifty 50 Index futures for August delivery rose 1.1% to 16,581.50, while MSCI Asia Pacific Index climbed 1.7%. The NSE Nifty 50 fell 0.7% on Friday to 16,450.50.
The dollar held its recent advance on haven demand due to the impact of the delta variant. Treasuries were little changed ahead of the Jackson Hole symposium from Thursday, which may offer insights into how the Federal Reserve plans to taper bond purchases.
The recent weakness in commodities such as crude oil remains in focus. Crude edged up and was trading above $62 a barrel. Bitcoin was close to retaking $50,000 for the first time since mid-May.
The delta variant and the prospect of reduced central bank support have sowed doubts about the world economic recovery and led to a pause in the global equity rally.
Back home, Nuvoco Vistas to debut after IPO. Hindalco, Timken are holding annual shareholders’ meetings. Foreign investors bought net Rs 1,100 crore of stocks on Aug. 18, according to NSDL website.
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