F&O Expiry: Sensex, Nifty end lower; Tata Motors dips 5% ahead of Q1 nos
The BSE Sensex closed at 37,831 level, down 17 points, or 0.04%. The broader Nifty50, too, shed 19 points, or 0.17%, to settle at 11,252 levels.
 "markets")
9:03 AM
Top gainers and losers on S&P BSE Sensex during Pre-open
9:02 AM
Market at Pre-open
9:01 AM
Rupee opening
Rupee opens flat at 68.98/$ vs Wednesday's close of 68.97 against the US dollar
9:01 AM
Market at Pre-open
8:59 AM
Stocks to watch: YES Bank, BoB, Tata Motors, Bajaj Finance, Bharti Infratel
Here's a look at the top stocks that may trade actively in today's trading session -
Earnings today: As many as 52 companies including names such as Tata Motors, Bank of Baroda, Ambuja Cements, AU Small Finance Bank, Bajaj Finserv, Bajaj Finance, Biocon, GRUH Finance, Mphasis, Jubilant Industries, Persistent Systems, PVR and RBL Bank are slated to declare their June quarter results today.
YES Bank: Credit rating agency Icra has downgraded ratings on Yes Bank’s Rs 32,911.7 crore bond programme, citing an increase in stressed assets and lack of debt resolutions. The outlook on the ratings remained negative. READ MORE
8:56 AM
FMCGs focus on earnings growth by cutting ad spends and other expenses
As the slowdown in the fast-moving consumer goods (FMCG) market gets pronounced, most companies are shifting their attention away from volume growth. Now, they are focusing on earnings growth, led by a cut in advertising spends and other expenditure.
Consider this: The six companies who reported their June quarter (Q1) results in the last one week saw a cumulative net sales growth of 8.9 per cent and profit growth of 12.7 per cent. READ MORE
8:54 AM
Motilal Oswal Financial Services on Jubilant Foodworks
Recommendation: NEUTRAL
CMP: Rs 1156
TP: Rs 1250
Upside: 8%
CMP: Rs 1156
TP: Rs 1250
Upside: 8%
We cut our EPS forecast for FY20/21 by ~8% to factor in the impact from (a) Ind-AS accounting on lease rentals and (b) disappointing earnings. We had pointed out in our channel check report on World Cup demand for QSRs that the tournament did have a positive impact on demand, but failed to provide the necessary boost to compensate for the very high SSSG base of 25.9% in 1QFY19. While the threat from the high SSSG base remains for only one more quarter now, the impact of cannibalization that was not at play earlier (net store addition of only 50 in 18 months ended 1HFY19) is now affecting both SSSG/margins. Also, continued slowdown in dine-in and no incremental benefits of Dunkin loss reduction are not helping the operating margins either. Valuations are fair at 37.8x FY21E EPS for a business with estimated earnings CAGR of ~12% over the next two years. Our TP of INR1,250 (40x Jun'21E EPS) implies limited upside from current levels. Maintain Neutral.
8:52 AM
Motilal Oswal Financial Services on Mahindra Financial Services
Recommendation: BUY
CMP: Rs 304
TP: Rs 400
Upside: 31%
Despite a slowdown in OEM volumes, MMFS has been able to deliver strong AUM growth, driven by its diversification into new product segments (such as pre-owned vehicles and CV/CE) and increasing share in different OEMs. While the company is likely to gain market share, we expect AUM growth to moderate to 14% YoY by year-end. Asset quality performance has been in line with expectations; however, up-fronting of provisions on stage 3 assets and movement within stages 1-3 of loans (based on macros) are likely to keep credit costs volatile. We cut our estimates for PPoP by 5-7% and PAT by 15-18% to factor in higher credit costs. Maintain Buy with a target price of INR400 (SOTP-based).
CMP: Rs 304
TP: Rs 400
Upside: 31%
Despite a slowdown in OEM volumes, MMFS has been able to deliver strong AUM growth, driven by its diversification into new product segments (such as pre-owned vehicles and CV/CE) and increasing share in different OEMs. While the company is likely to gain market share, we expect AUM growth to moderate to 14% YoY by year-end. Asset quality performance has been in line with expectations; however, up-fronting of provisions on stage 3 assets and movement within stages 1-3 of loans (based on macros) are likely to keep credit costs volatile. We cut our estimates for PPoP by 5-7% and PAT by 15-18% to factor in higher credit costs. Maintain Buy with a target price of INR400 (SOTP-based).
8:49 AM
Motilal Oswal Financial Services on Asian Paints
Recommendation: SELL
CMP: Rs1484
TP: Rs 1230
Downside: 17%
We increase our EPS estimate for FY20/21 by 6.7%/3.7% as we make changes to our model following the beat in 1Q. While results were strong amidst a muted operating environment, the ongoing economic slowdown adds an element of uncertainty to the earnings growth prospects, particularly given APNT's massive capacity expansion (addition of 50% to Sept'18 capacity up to Mar'19; to be scaled up to 100% by Mar'20). The deteriorating product mix and the weak progress on monsoon could further sour the case for earnings acceleration. Moreover the volatile EBITDA growth trajectory in recent quarters (30%, -2%, 17% and -2%, from 1QFY19 to 4QFY19) makes it hard for one to extrapolate on the 1QFY20 results. PAT CAGR has been a meager 6% over the past three years, and given the challenges indicated above (and despite earnings upgrade post the good numbers in 1QFY20), FY20 appears poised for another year of low PAT growth. RoCE, which stood at close to 40% at the beginning of the decade, deteriorated to 28% in FY16 and further to 21.3% in FY19 (far inferior to peers). Against this backdrop, valuations of 49.7x FY21E EPS (40% premium to peer average, despite moderate earnings prospects and inferior RoCE) appear stretched. We, thus, maintain our Sell rating on the stock with a target price of INR1,230 (40x June'21E EPS).
CMP: Rs1484
TP: Rs 1230
Downside: 17%
We increase our EPS estimate for FY20/21 by 6.7%/3.7% as we make changes to our model following the beat in 1Q. While results were strong amidst a muted operating environment, the ongoing economic slowdown adds an element of uncertainty to the earnings growth prospects, particularly given APNT's massive capacity expansion (addition of 50% to Sept'18 capacity up to Mar'19; to be scaled up to 100% by Mar'20). The deteriorating product mix and the weak progress on monsoon could further sour the case for earnings acceleration. Moreover the volatile EBITDA growth trajectory in recent quarters (30%, -2%, 17% and -2%, from 1QFY19 to 4QFY19) makes it hard for one to extrapolate on the 1QFY20 results. PAT CAGR has been a meager 6% over the past three years, and given the challenges indicated above (and despite earnings upgrade post the good numbers in 1QFY20), FY20 appears poised for another year of low PAT growth. RoCE, which stood at close to 40% at the beginning of the decade, deteriorated to 28% in FY16 and further to 21.3% in FY19 (far inferior to peers). Against this backdrop, valuations of 49.7x FY21E EPS (40% premium to peer average, despite moderate earnings prospects and inferior RoCE) appear stretched. We, thus, maintain our Sell rating on the stock with a target price of INR1,230 (40x June'21E EPS).
8:47 AM
Market Outlook | HDFC Securities
Indian markets could open flat to up Thursday following record S&P and Nasdaq highs on Wednesday and mixed Asian markets this morning. They could later make an attempt to rise further from lower levels.
Technically, with the Nifty correcting further, the bears remain in control. Further downsides are likely once the immediate support of 11,230 is broken. Any pullback rally could find resistances at 11,359-11,398.
Sectors and stocks to watch:
Sectors and stocks to watch:
IT and FMCG indices could provide a temporary bounce, while Capital Goods index could underperform. Among stocks under coverage, Amara Raja, Pidilite, Torrent Pharma, Dhanuka Agri, Indigo, SIS, HDFC Life, Credit Access could do well.
8:46 AM
ICRA downgrades YES Bank's long-term rating for bonds worth Rs 32,911 crore
Rating agency ICRA has downgraded private lender YES Bank’s long-term rating while maintaining a negative outlook on the bank, citing the lenders’ inability to reduce its exposure in the ‘BB’ and below-rated accounts and erosion in tier-1 capital on account of increase in risk-weighted assets and accelerated provisioning, leading to muted profitability. READ MORE
8:45 AM
Bank of Baroda Q1 preview: NII could rise 34% YoY; merged entity's nos eyed
India’s first three-way merged public sector bank, Bank of Baroda, is scheduled to announce its April-June quarter result of financial year 2019-20 (Q1FY20) on Thursday, July 25. The bank, which got merged with Vijaya Bank and Dena Bank with effect from April 1, 2019, is expected to post stronger numbers on standalone basis while analysts would eye results for the merged entity. READ MORE
8:44 AM
11,100 is a key support for the Nifty
The Nifty has slid through the past seven sessions. It broke support at 11,300. The next support is the 200-day moving average. The market is exhibiting many bearish characteristics and one potentially bullish signal. The advance-decline ratios are negative, and higher volumes have been associated with stocks that have lost ground. The mid-caps and small-caps have lost more ground than the large-caps. READ MORE
8:43 AM
Buy and sell ideas by Sacchitanand Uttekar of Tradebulls Securities
Stock: PIDILITE
Reco : BUY
CMP : Rs 1230
The stock reversed sharply post “double bottom” formation on the hourly scale. Volume spurt along with positive price action post prevalent “Bullish Divergence” indicates commencement of fresh upmove. Sustenance of support trendline post multiple test in previous trading sessions followed by spurt in volumes with positive price action augurs well for a momentum to continue on the upside. The stock can be bought with stop placed below previous session's low, 1,182, for retest of downward resistance line placed around 1,290 level in coming sessions. READ MORE
8:42 AM
Nifty outlook, top stock picks by CapitalVia
Buy Zee Entertainment Ltd (Above Rs 380)
Target: Rs 405
Stop loss: Rs 362
The stock was in narrow consolidation range for the last few months and has given a breakout. The level above 380 would result in MACD bullish crossover on the daily charts. Moving average and Oscillator setup is bullish on the short- and medium-term charts. Considering the technical evidence discussed above, we recommend buying the stock above Rs 380 for a target of Rs 405, keeping a stop loss at Rs 362 on a closing basis. READ MORE
Topics : Nifty Markets Sensex Sensex and Nifty MARKET WRAP
Don't miss the most important news and views of the day. Get them on our Telegram channel
First Published: Jul 25 2019 | 7:21 AM IST
