Sensex, Nifty Snap Two-Day Winning Streak Dragged By Metals, Banking Stocks

Indian equity benchmarks closed lower after fluctuating between gains and losses and snapped a two-day winning streak, dragged by metals, banks and energy stocks.

The S&P BSE Sensex index shed 0.34% to 61,143.33. The NSE Nifty 50 Index fell over 0.3% to 18,210.95. Axis Bank Ltd. contributed the most to the index decline and had the largest move, decreasing 6.5%. Today, 27 of 50 shares fell, while 23 rose.

The broader indexes outperformed their larger peers with the S&P BSE MidCap index little changed and the S&P BSE SmallCap index adding 0.30%. Eleven of the 19 sectoral indexes compiled by BSE Ltd. declined, with the S&P BSE Metal Index shedding nearly 2%.

The market breadth was skewed in favour of bulls. About 1,778 stocks advanced, 1,471 declined and 145 remained unchanged.

Welspun India Ltd. reported net income for the second quarter that beat the average analyst estimate

September Quarter Results (Consolidated, YoY)

• Net income at Rs 199.1 crore vs Rs 179.7 crore (Bloomberg Consensus Estimate: Rs 180 crore)

• Revenue at Rs 2,501.4 crore vs Rs 1,992.6 crore (Estimate: Rs 2,168 crore)

• Ebitda at Rs 423.7 crore vs Rs 404.8 crore

• Ebitda Margin at 16.9% vs 20.3%

Shares of Torrent Pharmaceuticals Ltd. shed over 4.4% in intraday trade, to Rs 2,813.85 apiece, lower than any close since June 9, after the company reported Q2 net income below average analyst estimate.

Torrent Pharma Q2FY22 (Consolidated, QoQ)

• Revenue up 0.14% at Rs 2,137 crore Vs Rs 2,134 crore (BBG estimate: Rs 2,172.4 crore)

• Net profit down 4% at Rs 316 crore Vs Rs 330 crore (BBG estimate: Rs 328.3 crore profit)

• Ebitda down 3% at Rs 660 crore Vs Rs 677 crore (BBG estimate: Rs 683.3 crore)

• Margins at 30.9% Vs 31.7% (BBG estimate: 31.5%)

• EPS at Rs 18.63 per share Vs Rs 19.53 (BBG estimate: Rs 19.6)

Trading volume was triple the 20-day average volume for this time of the day.

Torrent Pharma trades at 36 times its estimated earnings per share for the coming year.

Analysts have 16 'buy', seven 'hold' and six 'sell' recommendations on the stock.

• Canara Bank raised to 'buy' at Batlivala & Karani; Price target: Rs 230

• Ambuja Cements raised to 'buy' at Canara Bank; Price target: Rs 450

Source: Bloomberg

Shares of Triveni Turbine Ltd. rose over 15% in intraday trade to a record Rs 195.9 apiece after the company posted a sharp uptick in quarterly profit thanks to the settlement of disputes, on Sunday.

Trading volume on the stock was 14 times the 30-day average volume for this time of the day.

September quarter results (Consolidated, QoQ)

• Net income at Rs 173.76 crore vs Rs 27.75 crore

• Revenue at Rs 206.46 crore vs Rs 184.06 crore

• Total costs at Rs 171.73 crore vs Rs 153.49 crore

• Other income at Rs 7.82 crore vs Rs 5.55 crore

All the five analysts tracking the company maintained 'buy' recommendations. The overall consensus price of analysts tracked by Bloomberg implied a downside of 15.1%.

Shares of Indian Overseas Bank Ltd. rose over 4% to Rs 23.1 apiece after the lender reported a sequential growth in net profit in September quarter.

Second Quarter Results

• Net Profit at Rs 376.41 crore vs Rs 326.64 crore

• Interest income at Rs 4,254.49 crore vs Rs 4,063.17 crore

• Total costs at Rs 3,956.22 crore vs Rs 3,953.17 crore

Dishman Carbogen Amcis Ltd. announced that its subsidiary Carbogen Amcis AG completed U.S. FDA inspection of its facility in Aarau in Switzerland.

In an exchange filing, the company said that the pre-approval FDA paper inspection was conducted between August 17 and September 15, 2021.

Shares of TTK Prestige Ltd. rose over 5.2% in intraday trade to Rs 10,149.9 apiece after the company approved the split of equity shares of the company from face value of Rs 10 each to Re 1. The record date for the proposed sub-division will be intimated in due course of time, the company said in an exchange filing.

The company also reported sequential growth in net income and revenue in the September quarter.

Second Quarter Results (Consolidated, QoQ)

• Net income up 238.44% at Rs 103.53 crore vs Rs 30.59 crore

• Revenue up 114.06% at Rs 858.55 crore vs Rs 401.07 crore

• Total costs at Rs 727.80 crore vs Rs 368.61 crore

• Other income at Rs 8 crore vs Rs 8.28 crore

Of the 11 analysts tracking the company, eight maintained 'buy', two maintained 'hold' and one maintained 'sell' recommendations. The overall consensus price of analysts tracked by Bloomberg implied a downside of 0.7%. Trading volume was 6.5 times the 30-day average volume, for this time of the day.

• Ceat rated 'new buy' at YES Research; Price target: Rs 1,629

• Ramco Cements raised to 'buy' at KR Choksey; Price target: Rs 1,176

• Axis Bank reinstated 'buy' at Asian Markets; Price target: Rs 1,000

Source: Bloomberg

• Indian government bonds advance as the demand for debt remains buoyant amid abundant cash in the banking system. The rupee is little changed ahead of a large initial share offering by beauty startup Nykaa on Thursday.

• 10-year yields fall 2bps to 6.35%

• USD/INR steady at 74.9738

Source: Bloomberg

• Zomato Ltd. has 2 million shares change hands in a bunched trade.

• Details of buyers and sellers were not immediately known

Source: Bloomberg

• Gateway Distriparks Ltd. has 2.76 million shares change hands in a bunched trade

• Details of buyers and sellers are not immediately known

Source: Bloomberg

India's stock benchmarks edged higher, aided by gains in informationa technology, pharma, telecom and consumer durables stocks, amid positive global cues.

The S&P BSE Sensex rose 0.20% to 61,472.59. The NSE Nifty 50 index advanced by similar magnitude to 18,304.10. ICICI Bank Ltd. contributed the most to the index gain, increasing 1.8%. Asian Paints Ltd. had the largest increase, rising 4.2%. In midday trading, 31 of 50 shares rose, while 19 fell.

The broader indices outperformed their larger peers with S&P BSE MidCap rising 0.5% and S&P BSE SmallCap indexes adding 0.7%. Twelve of the 19sectoral indexes compiled by the BSE Ltd. advanced , with S&P BSE ‌Telecom and Healthcare indexes rising over 1%.

The market breadth was skewed in favour of bulls. About 1,951 stocks advanced, 1,207 declined and 135 remained unchanged

• Cutoff yields on Indian Treasury bills rose, with the RBI accepting bids at higher yields than traders expected.

• Cut-off yield at auction of the 91-day Treasury bill climbed to 3.5610% vs. 3.55% estimate; prior auction cutoff was 3.4496%

• Cut-off yield at auction of 182-day Treasury bill climbed to 3.8322% vs. 3.75% estimate; prior auction cutoff was 3.6996%

• Cut-off yield for 364-day Treasury bill rose to 4.0390% vs. 4% estimate; prior auction cutoff was 3.9490%

Source: Bloomberg

Shares of Larsen & Toubro Infotech Ltd. rise nearly 3% in intraday trade to Rs 6,689 apiece after the company became Microsoft Azure Expert Managed Services Provider. The recognition indicates the company's expertise in Azure capabilities to aid clients in their digital transformation journey, the company said in an exchange filing.

• The Managed Services Provider program launched by Microsoft is a global initiative that enables its partners to differentiate by proving real-world proficiency in data and cloud competencies.

• Sanjay Jalona, CEO and MD of L&T Infotech said that the recognition will enable the company provide its customers with access to broader range of Azure services.

• Of the 38 analysts tracking the company, 21 maintained 'buy', eight maintained 'hold' and nine maintained 'sell' recommendations. The overall consensus price of analysts tracked by Bloomberg implied a downside of 1.9%

The inclusion of Indian bonds in JPMorgan’s GBI-EM GD index can result in potentially $25 billion of additional foreign inflows, Arthur Luk, strategist at JPMorgan Chase & Co., wrote in a research note.

• The total notional value of the so-called Fully Accessible Route, or FAR, govt bonds will likely be large enough for a maximum 10% weight in the JPM Benchmark that is followed by ~$250 billion of assets under management

• This is a significant amount relative to the $38 billion of foreign ownership in India local bonds

• The timing of how long it takes for “Index Watch” to eventually translate into actual inclusion will depend on domestic and international developments

• Given India’s large weight in the index, actual inclusion will likely be staggered over 10 months, similar to China’s inclusion into GBI-EM in 2020

• Improvements in operational efficiency for transactions and clarity on taxes were cited by the JPM index team as some of the key remaining hurdles by benchmarked investors

• RBI approves appointment of Baldev Prakash as MD and CEO of the Bank for a period of three years from the date of taking charge or April 10, 2022, whichever is earlier.

• Actual date of his taking charge shall be communicated separately.

Source: Exchange Notification

India’s foreign exchange reserves have risen by $200b over the last two years but this could halt now as the economy’s balance of payment surplus dwindles, led by weakening of its currency, according to note by analysts at Jefferies

• "The impact of higher energy/raw material prices makes us believe that inflation hedges should outperform,” they say

• The analysts remove Gujarat Gas and cement maker ACC from model portfolio, mainly on impact of higher energy costs while raising weights on banks by adding IndusInd Bank

• They also raise weight of Reliance Industries while replacing HCL Technologies with Tech Mahindra

• India has ~11 month import cover for its goods and services requirements, which lends macro stability; however as the BoP starts to flatten, the rupee could be at incremental risk of depreciation despite likely RBI smoothing action, the note says, estimating the rupee will head to 77-78 against the dollar by Sept. 2022

Source: Bloomberg

Ramkrishna Forgings Ltd. has acquired an order worth Rs 15 crore to supply fabrication parts to one of the biggest players in the energy segment, the company said in an exchange filing.

Lalit Khetan, the executive director and CFO of the companys aid that the order is a testimony of the company's technical quality in the non-auto segment.

Of the five analysts tracking the company, four maintained 'buy', one maintained 'hold' recommendations. The overall consensus price of analysts tracked by Bloomberg implied an upside of 16.3%

• IRB Infra cut to 'neutral' at Phillip Securities; Price target: Rs 260

• Kotak Mahindra Bank reinstated 'buy' at Asian Markets; Price target: Rs 2,540

• Nippon Life India AM raised to 'buy' at Nirmal Bang, Price target: Rs 502

Source: Bloomberg

• Cipla raised to 'buy' at Nirmal Bang; Price target: Rs 1,041

• Canara Bank raised to 'add' at Kotak Securities; Price target: Rs 210

• Bajaj Finance cut to 'sell' at Kotak Securities; Price target: Rs 6,000

Source: Bloomberg

Shares of Asian Paints Ltd. rose 5.90% in intraday trade to Rs 3,145 apiece after the company after Nomura upgraded the recommendation on the stock to 'buy' and assigned a target price of Rs 3,550.

• Trading volume was five times the 20-day average volume for this time of the day.

• Asian Paints trades at 96 times its estimated earnings per share for the coming year.

• Analysts have 17 'buy', eight 'hold' and 14 'sell' recommendations on the stock.

Indian equity benchmarks opened higher, aided by gains in consumer discretionary and consumer durables stocks, amid positive cues as earnings lifted sentiment globally.

The S&P BSE Sensex rose 0.12% to 61,425. The NSE Nifty 50 advanced by a similar magnitude to 18,291.40. Asian Paints Ltd. contributed the most to the index gain and had the largest move, increasing 5.3%. In early trading, 37 of 50 shares rose, while 13 fell.

The broader indexes almost mirrored their broader peers with the S&P BSE MidCap index and the S&P BSE SmallCap adding over 0.3%. Thirteen of the 19 sectoral indexes compiled by BSE Ltd. advanced, with the S&P BSE Consumer Durables index rising nearly 1%.

The market breadth was skewed in favour of bulls. About 1,601 stocks advanced, 603 declined and 96 remained unchanged.

Mahindra Lifespaces Developers Ltd.,the realty arm of Mahindra group, has finalised terms for a joint development on a 4.8-acre land parcel in Dahisar East in Mumbai. In an exchange filing, the company said that the land parcel was located on the Western Express Highway and offered 5 lakh square feet of carpet area.

Indian bond traders will await a Rs 20,000 crore ($2.7b) sale of Treasury bills to gauge the direction of short-term rates. Rupee traders will watch for inflows with a large initial share sale due to open Thursday.

• USD/INR fell 0.2% to 74.9588 on Tuesday

• 10-year yields rose 1bp to 6.36%

• Global funds sell net Rs 2,370 crore of India stocks Tuesday: NSE

• They bought Rs 35 crore of sovereign bonds under limits available to foreign investors, and withdrew Rs 92 crore of corporate debt

• State-run banks bought Rs 1,260 crore of sovereign bonds on Oct. 26: CCIL data. Foreign banks sold Rs 894 crore of bonds.

Source: Bloomberg

S.J.S. Enterprises Ltd. set a price range of Rs 531-Rs 542 a share for its initial public offering, in which its founders are seeking to raise as much as Rs 800 crore ($107 million), according to an advertisement in the Financial Express newspaper Wednesday.

• IPO comprises offer-for-sale of up to Rs 710 crore worth of shares by Evergraph Holdings Pte. and Rs 90 crore of shares by K.A. Joseph; Evergraph Holdings owns 77.86% and KA Joseph holds 20.74% stake in the company

• Investors can bid for minimum 27 shares of face value Rs 10 in the sale, which opens Nov. 1 and closes Nov. 3

• The Bangalore-based company, which makes decorative aesthetics products for the automotive and consumer appliance industries, and counts Tata, Hyundai and Fiat among its customers, isn’t selling any new share, and won’t receive any proceed from the IPO

• Axis Capital, Edelweiss Financial and IIFL Securities will manage the IPO

• Paytm has raised its initial public offering size to Rs 18,300 crore from the earlier Rs 16,600 crore, Business Standard reported citing people it did not identify.

• Roughly half of the offer for sale in Paytm’s IPO will be done by Ant Financial: Report

• The OFS size will now inch up to Rs 10,000 crore, resulting in Ant Financial offloading shares worth Rs 5,000 crore: Report

• Kotak Mahindra Bank, Axis Bank, IndusInd Bank submitted binding offers on Friday to buy Citigroup Inc.’s consumer banking assets in in India valued at about $2 billion, Economic Times reported citing people it did not identify.

• Citigroup expected to announce winner in next 1-2 months, according to the report

• DBS Group Holdings Ltd., ICICI Bank, HDFC Bank didn’t bid, the newspaper said

• Polycab India cut to 'add' at Spark Capital Advisors; Price target: Rs 2,421.

• Kotak Mahindra Bank cut to 'reduce' at Spark Capital Advisors; Price target: Rs 2,019

• Ambuja Cements raised to 'outperform' at Credit Suisse; Price target: Rs 450

Source: Bloomberg