All You Need To Know Going Into Trade On April 21
Asian markets have followed their U.S. counterparts into the red, a day after oil prices fell to historic lows and into negative territory for the first time.
Investors are grappling with the oil crash as well as signs that deaths due to Covid-19 are easing in some parts of the world.
The Singapore-traded SGX Nifty, an early indicator of NSE Nifty 50 Index’s performance in India, rose 0.2 percent to 9,212 as of 7:00 a.m.
Short on time? Well, then listen to this podcast for a quick summary of All You Need To Know before the opening bell.
Here’s a look at all that can influence equities in today’s trading session:
- Equities have opened with losses in Japan, Australia and South Korea. U.S. futures are tipping higher after benchmarks fell from their highest in six-weeks on Monday.
- The price on the futures contract for West Texas crude, scheduled for expiry today fell into negative territory and fell as much as minus $37.63 per barrel. The lack of demand and the resultant storage space shortage led to this fall. The contract is currently trading at $2 per barrel
- U.S. Congress is close to finalising a fresh spending package to offset the effects of the Covid-19 pandemic.
- Nearly one-fifth of the S&P 500 companies are reporting their quarterly earnings this week.
- Yield on the 10-year treasury was steady at 0.61 percent.
Get your daily fix of the global markets here.
Earnings Fineprint: Infosys Q4FY20
- Results in-line with estimates
- Revenue in U.S. dollar terms falls 1.4 percent to $3,197 million
- Revenue in rupee terms up 0.8 percent to Rs 23,267 crore
- EBIT down 2.7 percent to Rs 4,927 crore
- EBIT Margins fall to 21.2 percent from 21.9 percent
- Margins under pressure as company adapts to new working environment
- Net profit down 3 percent to Rs 4,335 crore
- Digital services now forms 42 percent of the total revenue
- Unable to provide guidance on revenues and margins for FY21 due to business uncertainties emanating from Covid-19
- All numbers are consolidated and compared on a sequential basis.
Brokerages On Infosys
- Buy rating maintained
- Price target of Rs 750
- Small miss on revenue and profitability in Q4
- Business continuity efforts successful
- Large deal signings strong in Q4
- Neutral rating maintained
- Price target of Rs 660
- Deferring of guidance in-line with expectations
- Markets may not like the margin miss in Q4
- Buy rating maintained
- Price target raised to Rs 715 from Rs 690
- Muted results in-line with expectations
- Impact of Covid-19 led to slight disappointment in growth, margins
- Better placed than most peers
Stocks To Watch
- Reliance Industries: Bloomberg News reports that the European Union has cleared the deal with British Petroleum.
- Morepen Laboratories: Gets license to manufacture Hydroxychloroquine from the State Drug Controller last week for its Baddi plant in Himachal Pradesh and is working to commercialize the production of HCQ in both API as well as tablets form. Company is also making infrared thermometers, hand sanitizers, hand wash and face masks.
- TCS: Enters into a strategic partnership with Amway to transform Amway’s global technology operations.
- JK Lakshmi Cement: Integrated plants at Rajasthan and Chhattisgarh have become operational and have resumed cement dispatches.
- Amara Raja Batteries: Andhra Pradesh plant has resumed operation on a limited scale and most of the operations still stand suspended due to restrictions. However, the Company is fully prepared to scale up the operations based on the requirements and needs of the customers as said in the press release.
- KEC International: Factories in Brazil and Mexico, identified as an Essential Sector in the respective geographies have been operational throughout. Company has commenced operations at some of its T&D/Railways/Civil sites after receiving the requisite approvals.
- Heidelberg Cement: Resumed partial operations in some of its manufacturing units and is in the process of doing so for other units.
- Shriram Transport Finance: Board to seek shareholders nod to raise up to Rs 35,000 crore.
- Excel Industries: Manufacturing operations have restarted and will be ramped up gradually.
- HUDCO: To consider raising Rs 1,500 crore via bonds on April 24.
- L&T: Allotted NCDs worth Rs 1,250 crore which will mature in April 2023.
- Everest Industries: Resumed operations at its plants in Odisha, Maharashtra and Uttarakhand.
- Ashoka Buildcon: Has commenced toll collection on the toll projects of the company and its arms. It has started operations at most of the projects, whilst receiving permission at various location to resume construction activities and road/power projects related work.
- Neogen Chemicals: Has resumed partial operations at Navi Mumbai and 3 plants in Gujarat.
- Jubilant Lifesciences: Rakesh Jhunjhunwala increased stake to 4.41 percent from 3.45 percent, as per the latest shareholding pattern.
- JMC Projects: All four road SPV have resumed the collection of user fee at all fee plazas on National Highways.
- Earnings Today: ACC, CRISIL, Den Networks, GTPL Hathway, GSS Infotech , ICICI Prudential Life Insurance, Tejas Networks.
Other Earnings Announced After Market Hours
Tata Elxsi Q4FY20
- Revenue up 8.3 percent to Rs 438.9 crore
- Ebitda up 6.5 percent to Rs 97.8 crore
- Ebitda Margins at 22.3 percent from 22.7 percent
- Net profit up 15.1 percent to Rs 82.1 crore
- Tax as a percentage of PBT at 75 percent from 66 percent
- Low other expenses aid bottom-line
- Board declared dividend of Rs 16.5 per share
- All numbers are standalone and compared on a year-on-year basis
Linde India Q1CY20
- Revenue down 14.5 percent to Rs 377.3 crore
- Ebitda down 22.9 percent to Rs 87 crore
- Ebitda Margins at 23.1 percent from 25.6 percent
- Net profit up 9.6 percent to Rs 39 crore
- Low finance costs and freight expenses aid profitability
- Gas segment revenue down 9 percent to Rs 307 crore
- Project Engineering segment revenue down 34 percent to Rs 70.5 crore
BofA Securities On SBI Cards
- Initiate coverage with buy rating
- Price target of Rs 680
- Strong position in a rapidly growing market
- Cross-selling to SBI customers offers growth opportunity
- Expect spends to decline 4 percent and credit costs to rise 75 percent due to Covid-19 in FY21
Emkay On UPL
- Initiate coverage with buy rating
- Price target of Rs 500
- Market share gains, merger synergies and deleveraging to aid re-rating
- See margins improving by 200 basis points led by market share gains and synergy benefits
- Earnings growth and working capital improvement key in reducing debt
Citi On Reliance Industries
- Buy rating maintained
- Price target cut to Rs 1,530 from Rs 1,580
- Energy earnings may remain subdued
- Non-energy earnings are more resilient
- Overall consolidated Ebitda may rise 10 percent in FY21
- Risk-reward is compelling
- Top large-cap sector pick
Pledged Share Details
- Dish TV: Promoter Direct Media Distribution Ventures invoked pledge of 1.66 crore shares on April 13
- Wockhardt: Promoter Themisto Trustee revoked pledge of 6 lakh shares on April 17
- Ajanta Pharma: Promoter Aayush Agrawal revoked pledge of 3.29 lakh shares on April 17
(As Reported On April 20)
Who’s Meeting Whom
- Bharat Forge: To meet Capital World, Franklin Templeton and Capital International from April 21-22
- Mahindra & Mahindra: To meet Fidelity Group, Neuberger Berman and UBS Securities from April 21-22
- Price Band Revised To 5 Percent From 10 Percent: Andhra Cements, Hubtown, Mahindra Logistics, Muthoot Capital, Vipul, Welspun India
- Price Band Revised To 10 Percent From 20 Percent: Alphageo, IRB Infra, Bharat Road Network, Jammu & Kashmir Bank, Punjab & Sind Bank.
- Move Into ASM Framework: Welspun Corp, Hubtown, HT Media, Reliance Infrastructure, RIIL, Bombay Rayon Fashions, Aksh Optifibre, Texmaco Infra & Holdings.
- Move Into Short-Term ASM Framework: Igarashi Motors, VST Tiller Tractors, eClerx Services, Wheels India, Kolte-Patil, Premier Explosives, Graphite India, Insecticides India.
- Move Out Of Short-Term ASM Framework: Emami, Dishman Carbogen Amcis, Balaji Telefilms, Procter & Gamble Health, IG Petrochemicals, Quick Heal Technologies, Panacea Biotech.
Money Market Update
- The currency on Monday ended weaker at 76.55 against the U.S. Dollar as compared to Friday's close of 76.38.
- Nifty April futures closed at 9,260.5; a discount of 1.3 points versus a premium of 44.6 points
- Nifty April futures shed 1 percent in Open Interest and 1.2 lakh shares
- Nifty Bank April futures closed at 20,482.2; a discount of 40 points versus a premium of 67.4 points
- Nifty Bank April futures add 2 percent in Open Interest along with 24,000 shares
- Nifty Put-Call Ratio at 1.36 versus 1.37 across all series
Nifty Weekly Expiry: April 23
- Maximum Open Interest on Call side at 10,000 strike (14.1 lakh shares)
- Maximum Open Interest on Put side at 9,000 strike (13.6 lakh shares)
- Open interest addition seen in 9,700 Call (3.2 lakh shares), 9,300 Call (3.2 lakh shares) and 9,200 Put (2.7 lakh shares)
Nifty Monthly Expiry: April 30
- Maximum Open Interest on Call side at 10,000 strike (18.9 lakh shares)
- Maximum Open Interest on Put side at 8,000 strike (23.9 lakh shares)