MARKETS: Sensex gains 484 pts as IT, financials rally; Nifty ends at 9,314

All that happened in the markets today

2:37 PM

Why brokers are up in arms against MCX over the April crude oil contract

generates the highest volumes on the exchange. The contract was launched 15 years ago and was based on US shale oil price indicator WTI (West Rexas intermediate), which is traded on New York Mercantile Exchange (NymEx). The kind of crude oil India imports is more akin to Brent Oil but for trading purpose WTI settlement has proved to be more suitable and easier to track. READ MORE

2:27 PM

BROKERAGE VIEW:: Axis Securities on Bajaj Auto

We are initiating coverage on Bajaj Auto with a HOLD rating as significant headwinds of COVID19 and low crude oil prices will lead to near term pressure on BJAUT but we expectit to outpace industry growth in the long run led by 1) Innovation in product with a dual focus on entry and premium segment 2) Focusing on exports and expanding to newer geographies. We expect Vol/Rev/EBITDA/PAT CAGR of -0.5%/2%/-2%/-3% over FY20E-22E. Our HOLD rating is based on the fact that current price provides limited upside of 8% with a target price of Rs. 2571/share, valuing it at 16X FY22E PE ratioand Rs 80/share for its stake in KTM.

2:19 PM

BROKERAGE VIEW:: Motilal Oswal Financial Services on NTPC

Amid a nationwide lockdown, India’s power demand has declined 20–25% YoY. However, regulated utility companies such as NTPC remain well-insulated from these external conditions. NTPC’s profitability is largely dependent on the ability to operate and declare availability for its plants. The direct impact of lower power demand / plant utilization is seen largely in the form of lower PLF incentives (1–2% of earnings).

 

Given the essential nature of power generation, operations continue at NTPC’s plants. Coal stocks at power plants have also increased amid a ramp-up in Coal India’s production and lower power demand, thus reducing risks related to fuel availability.

Moreover, NTPC has commercialized 5.3GW of plants in FY20, the highest ever in a single fiscal year. While an extended country-wide lockdown could impact upcoming commercialization plans (FY21 guidance: ~5GW), we note: even if we assume no incremental commercialization, NTPC should register 6–7% earnings growth in FY21 as the full benefit of recent additions flows through.

We build in some delays on execution and expect commercialization of 3.6GW in FY21. The current stock price implies 0.8x FY21 P/BV, which is at a ~40% discount to its long-term averages. Reiterate our Buy rating on the stock, with TP of Rs148/sh.

2:18 PM

RBI to buy and sell Rs 10,000 cr in bonds to manage its balance sheet

The Reserve Bank of India (RBI) on Thursday said it will sell Rs 10,000 crore worth of short-term bonds, and buy an equivalent amount in long term bonds on Monday. This is a revenue and liquidity neutral operation, which is possibly aiming at the central bank’s balance sheet management, though the RBI did not specify a reason. READ MORE

2:08 PM

Rupee closing

Rupee ends higher at 76.07/$ vs Wednesday's close of 76.67 against the US dollar

2:05 PM

NEWS ALERT | IndiGo to pay full salaries to most employees except top management for April: CNBC TV18

Alert: IndiGo had announced 5-15% pay cut for pilots, cabin crew, assistant vice presidents, vice presidents, Band C & Band D employees

1:54 PM

NEWS ALERT | Fitch revises outlook for Indian IT services to negative: CNBC TV18

>> Sees average sales growth of large tech cos at 0-2% Vs 6-8%

>> Sees average sales growth of mid-sized tech cos at 0-2% Vs 10-12%

>> Support for remote working to off-set some IT budget impact

1:49 PM

BROKERAGE VIEW:: Centrum Broking on Reliance Industries

The stake sale is the first step in the steady unlocking of value across businesses, with the Saudi Aramco Deal for Oil to Chem (OTC) business also a key monitorable over next 12Mths. Our consolidated EBITDA declines by 3/3.5% for FY21/22E to factor the sale but still implies a 15.1/19.8% CAGR in EBITDA/PAT over FY20-22E. Despite the challenging downstream environment, we believe FY22E will see a marginal improvement in margins and current valuations of 13.7x PER/ 9.3x EV/EBITDA FY22E remain extremely attractive. Reiterate BUY, price target of Rs1,595/share. BUY

1:46 PM

One month of lockdown: Small-caps outperform Sensex, mid-caps

The S&P BSE Small-cap index has recovered 26 per cent as compared to a 23 per cent rise in the S&P BSE Sensex and broader market index S&P BSE Midcap index from their respective 52-week low touched on March 24.

 

The run-up has been on account of a rally in stocks of pharmaceutical, fertilizer, chemicals and auto ancillary stocks. READ MORE

1:35 PM

NEWS ALERT | PM Modi to meet FM Sitharaman tomorrow at noon: TV reports

1:32 PM

Mindtree Q4 preview: Commentary on Travel biz, growth outlook for FY21 eyed

Client mining opportunity and order pipeline, commentary on travel vertical, outlook on a possible merger with Larsen & Toubro Infotech (LTI), and revenue growth and outlook for FY21E are some of the key things to watch out for in the results announcement. READ MORE

1:20 PM

NEWS ALERT | Britannia Ind declares interim dividend of Rs 35/sh

1:18 PM

INVESTMENT IDEAS :: Top picks by ICICI Securities

1:09 PM

NEWS ALERT | Centre stops dearness allowance of central govt employees

1:03 PM

Uncertainty over new 'beneficial ownership' clause for Chinese FDI

The government's sudden move on Saturday to protect domestic firms from hostile takeovers by 'opportunistic foreign firms' as the coronavirus pandemic rages on, have used a curious legal condition for the first time. Globally, the powerful 'beneficial ownership' clause establishes who the ultimate owner of a company is, the extent to which cross ownership is allowed and sets rules on how companies should report on their ownership structures. READ MORE