RBI's liquidity shot lifts pharma, bank stocks; Sensex leaps 424 pts

The RBI's well guarded measures which, analysts believe, are tuned to the evolving situation may support the economy going forward

9:19 AM

Opening Bell :: Nifty tests 14,600

9:18 AM

Opening Bell :: Sensex starts with a 200-pt gain

9:14 AM

Fuel prices :: Petrol price hiked by 19 paise

>> Diesel price up 21 paise today

>> Prices have been increased for second consecutive day

9:11 AM

Commodity prices in early deals :: Crude ticks up 1%; silver up half a per cent

9:09 AM

Top gainers and losers on the S&P BSE Sensex in Pre-open

9:08 AM

Pre-open session :: Nifty reclaims 14,600

9:06 AM

Pre-open session :: Sensex starts higher

9:04 AM

BROKERAGE VIEW :: Emkay Global on RBL Bank

Reco: BUY | TP: Rs 255

We believe RBL has emerged stronger from the deposit scare in FY20, and it has largely dealt with high risk & vulnerable corporate/retail portfolio in FY20/FY21. However, near-term asset quality risk remains with the onset of the second Covid-19 wave, leading to gradual moderation in credit cost in FY22 and going forward.

That said, we take comfort in the bank’s healthy capital position, improvement in liability profile and gradual uptick in its RoA/RoE to 1.4%/8-13% over FY22-24E from a low of 0.5%/4% in FY21. We retain Buy with a revised TP of Rs255 (from Rs290), factoring in a cut in earnings estimates and TP multiple.

Key risks to our call include higher-than-expected stress build-up in retail portfolios and top management change.

9:02 AM

BROKERAGE VIEW :: Kotak Securities on RBL Bank

Reco: BUY | TP: Rs 240

RBL Bank reported 35% yoy decline in earnings despite a 15% yoy operating profit growth as loan-loss provisions were high at 25% yoy. Slippages were high (~10% annualized) led by the credit card portfolio but flat qoq. FY2022 would continue to see elevated provisions but it would be primarily to improve the provision coverage ratio.

The bank has a strong CAR to withstand the crisis, which is a positive. The stock is inexpensive at current valuations, driving our positive view though we acknowledge that the drivers for re-rating the stock are currently absent.

The key challenge has been that the credit costs have consistently increased in recent years for various factors. The book that is currently undergoing stress, unlike corporate loans, is priced for these scenarios but forecasting stress and credit costs has not been easy.

8:59 AM

BROKERAGE VIEW :: Kotak Securities on Godrej Properties

Reco: SELL | TP: Rs 890

GPL’s narrative for FY2021 remains unchanged from previous years (1) a strong sales trajectory across key focus cities with sales of Rs67 bn (+14% yoy), (2) moderated business development (6 mn sq. ft in FY2021), (3) modest cash generation at Rs8.9 bn (Rs7.9 bn in FY2020) before land payments (Rs19 bn) against capital employed of Rs77 bn, and (4) aggressive equity raise of Rs37 bn that leaves the balance sheet substantially under-leveraged with net cash of Rs5.8 bn as of March 2021.

GPL holds the pole position in terms of residential sales among the listed real estate developers, with a multi-city presence making it the prime candidate to play the consolidation theme. Improvement in margins, and better cash generation from extant projects would help justify the substantial premium at which Godrej Properties trades at relative to peers. Maintain SELL rating with a revised FV of Rs890/share (from Rs810/share).

8:57 AM

BROKERAGE VIEW :: Kotak Securities on Adani Ports and SEZ

Reco: ADD | TP: Rs 825

ADSEZ ended an eventful FY2021 with marked outperformance, healthy cash flow generation, an improved cost structure and entry into new markets that obviate growth fatigue for the next decade. Incremental focus would be on growing the logistics business, which would also help enhance growth prospects and customer stickiness for the mainstay ports business over time.

We lower FY2023E EBITDA by 5% on modest cuts to our revenue and margin estimates. Cut in FY2022E EBITDA is higher as we factor in impact of second wave and defer consolidation of recently acquisitions to end-FY2022.

8:55 AM

BROKERAGE VIEW :: ICICI Securities on Home First Finance

Reco: BUY | TP: Rs 625

Home First Finance Company (HomeFirst) exited FY21 on expected lines with: 1) stage-3 assets at 1.8%, credit cost at 100bps, 1+ dpd pool at 6.2%, and zero restructuring; 2) disbursements regaining traction in Q4FY21 or H2FY21 (supported AUM growth of 14% YoY / 5% QoQ; 3) after a pause, securitisation of Rs 1.2bn of asset pool yielded income of Rs181mn (securitisation income in FY21 being at par with FY20 at 1.1% of assets); 4) Portfolio spreads drawing support of lower borrowing cost settled >5%.

With >30% AUM growth, funding cost benefit, improved cost to income ratio, and contained credit cost, we expect earnings to compound at ~40% over FY21-FY23E. However due to excessive capitalisation (tier-1 at 55%) and despite >3% RoAs, RoEs will be modest at ~12%.

Key risks: i) sourcing as well as collections managed by front-end team; ii) apartment home loans showing some stress (in pockets).

8:51 AM

Supreme Court defers hearing Amazon, Future case amid Covid-19 surge: Report

The top court was scheduled to hear the case between US-based e-commerce giant Amazon and Kishore Biyani’s Future Group over the Rs 24,713 crore deal between Future and Reliance Industries Ltd on Tuesday. READ MORE

8:48 AM

SGX Nifty zooms ahead of RBI Guv's address

>> The index was ruling 72 points higher at 14,608 levels at 8:47 AM.

>> Reserve Bank of India Governor Shaktikanta Das will make an unscheduled speech at 10 am today, Wednesday, as a new coronavirus wave threatens a nascent economic recovery. READ MORE

8:46 AM

Top stocks to watch today

Earnings Today: A total of 20 companies are slated to post their March quarter numbers today, including Tata Steel, Adani Green Energy, Blue Dart Express, Gillette India and Deepak Nitrite.

 

Adani Ports: The company's net profit for the March quarter jumped fourfold to Rs 1,287 crore from Rs 334 crore a year ago but fell short of the Rs 1,465 crore consensus forecast of analysts tracked by Bloomberg. In other news, the company said US-based counsels are of opinion that its investment in a port in Myanmar are not in violation of law, but the firm will abandon the project if the US administration opines that the investment was in violation of sanctions against Military-ruled nation. READ MORE