Sensex slips 183 pts in a choppy trade; Nifty below 15,700; TCS dips 1.5%

The broader markets, on the flipside, settled about half a per cent higher.

2:02 PM

Heavyweights drag Sensex

2:01 PM

Markets @ 2PM

1:58 PM

Phillip Capital on IT sector

More important than the Q2CY21 ISG dealflow data, was the upgradation of CY21 outlook. The strong growth forecast in the Traditional and As-a-service augurs well for the Indian IT companies, and reinforces our long-term positive stance of (1) strong fundamentals, (2) IT companies benefitting from accelerated digital adoption and (3) strong recovery in FY22 on pent up demand. Maintain our top picks as TCS and Infosys (in largecaps) and on Mindtree, Coforge, Mphasis and KPIT (in midcaps). We maintain our negative stance on TechM.

1:55 PM

Edelweiss on consumer durables

Following the recent lockdown, many brands across products (appliances, electrical appliances) started taking price hikes that were overdue. While one must keep close tabs on how much of it is accepted by consumers, clearly there is a potential OPM challenge in FY22E for most players with peak cost savings behind.

 

We prefer players with solid competitive moats, expanding TAM potential and an asset-light business model, our model portfolio has outperformed Nifty/BSE CD Index by 22/17% (6M) and 41/18% (12M). Top picks: Crompton, Voltas, Bajaj Electricals and KEI. Avoid and sell: Symphony and Whirlpool of India

1:52 PM

Edelweiss on Zomato IPO

We attended Zomato’s IPO analyst meet. Key takeaways: i) Food services industry in India is highly underpenetrated and offers a huge long-term growth opportunity. ii) Management does not see a major threat from direct delivery, iii) The company will keep exploring various adjacent areas to leverage capabilities.

 

While we concur with management on the opportunity size, we believe network effect in the food delivery space is not the strongest. Hence, execution excellence would be key to long-term value creation. (refer to Zomato: Delivering convenience). At its upper band, the company is valued at USD7bn pre-money, which is a 30% premium to the last funding round.

1:52 PM

Edelweiss on retail sector

While Q1FY22 optically shows 53% YoY growth compared with Q1FY20, revenues are still down 37% (~60% recovery) as the second wave’s impact nipped the recovery seen in Q4FY21. The sector as a whole and most companies will still manage to report positive EBITDA given the adjustment to the cost base.

By segment, QSRs are likely to clock highest recovery as it has evolved its model towards delivery /convenience channel. Apparel retail will again see lowest recovery with inventory levels and discounting being key monitorables. Overall, our top picks continue to be Titan, Jubilant FoodWorks and V-Mart Retail. We remain cautious on Avenue Supermarts (DMart) and Page Industries (Page).

1:50 PM

InCred on India Pesticides Limited

We value India Pesticides at 20x Jun FY23F EPS, in line with its peers, to arrive at our TP of Rs287. We initiate coverage on India Pesticides with a Reduce rating because of slowing growth and high valuation. Risks: 1) India Pesticides makes multiple formulations and it is possible that some actions could see sudden success, which could raise EPS, hence, stock price; 2) pyrethroids prices rose fast in FY21 due to supply chain issues, and any repeat of such issues in other generic chemicals will be positive for IPL, in our view.

1:47 PM

Textiles stocks in demand; Vardhman, Siyaram Silk, RSWM hit 52-week highs

The Union Budget 2020-21 had set the momentum to give the ailing textile sector a new lease of life by announcing the setting up of mega textile parks, increasing duties on import of textile products, and rationalising the custom duty rates on imports of raw materials, allowing 100 per cent foreign direct investments (FDI) for the sector under the automatic route, assisting in the development of import substitution products and continuing of other schemes for the industry. All this will provide the required impetus to the textile sector and help on the path of speedy recovery. READ MORE

1:27 PM

Ola IPO :: Temasek, Warburg Pincus, Bhavish Aggarwal invest $500 mn

This is amongst the largest investments in the Indian consumer internet space by these funds and is a testament to the robust and resilient business built by Ola, as it continues to scale up across various categories and geographies in its ride hailing business. READ MORE

1:14 PM

Index watch

12:58 PM

IPO MARKET UPDATE

>> Clean Science & Technology IPO subscribed 10.5x on Day 3

 

QIB quota subscribed 8x

NII quota subscribed 23x

Retail investor quota subscribed 6.8x

 

>> GR Infraprojects IPO received over 12x bids on Day 3

 

QIB quota subscribed 7x

NII quota subscribed 27x

Retail investor quota subscribed 9.6x

 

Source: BSE | Details as of 12.55 pm  

12:38 PM

Nomura on Indian economy

Experience from the first wave suggests that lockdown-related inflationary pressures are typically sticky. Coupled with rising supply-side (higher input costs) and demand-side (reopening) pressures, we now expect CPI inflation to average 5.6% y-o-y in both 2021 and 2022 (6.1% in FY22), with core inflation likely to remain

elevated above 6% levels until Q1 2022.

The next couple of CPI readings will be important for establishing the extent to which the flare-up in May is reversed. We expect headline inflation to inch up higher to 6.5% y-o-y in June from 6.3% in May (data out on 12 July) and average over 6% in Q3 (July – September). The moderation in inflation in Q4 due to base effects, will again reverse in early 2022.

12:36 PM

MUST READ :: Correction in bank stocks offers a good entry point: Gautam Duggad, MOFSL

As TCS kicks off the June 2021 quarter earnings season, GAUTAM DUGGAD, head of research at Motilal Oswal Institutional Equities says expectations of a strong financial year 2021-22 (FY22) are now well entrenched and the second wave has not done much damage to those expectations yet FULL INTERVIEW HERE

Gautam Duggad, head of research, Motilal Oswal Institutional Equities

12:34 PM

Bank stocks bleed

COMPANY	LATEST	LOSS(Rs)	LOSS(%)
Axis Bank	745.50	-8.95	-1.19
Federal Bank	85.35	-0.70	-0.81
HDFC Bank	1508.00	-12.10	-0.80
ICICI Bank	637.20	-4.50	-0.70
City Union Bank	161.65	-0.90	-0.55
Kotak Mah. Bank	1723.50	-9.25	-0.53
St Bk Of India	423.55	-0.85	-0.20

 

 

 

 

12:30 PM

Top gainers (BSE 500)

Company	PRICE(Rs)	CHG(%)	VOLUME
Edelweiss.Fin.	84.75	7.76	1431411
Sunteck Realty	332.10	6.87	130312
Garware Tech.	3565.30	6.44	1361
PNB Housing	751.10	4.24	9091
Metropolis Healt	3098.00	4.17	31450