MARKET WRAP: RIL, HUL help Sensex end 199 pts up; Nifty settles at 9,251

All that happened in the markets today

11:21 AM

Gold Outlook | Anuj Gupta , DVP–Commodities & Currencies Research, Angel Broking

On Thursday, gold prices increased almost 1.74% and closed above 46100 levels. In international market, gold is also trading on a positive note. This is due to weakness in dollar due to dovish US economic data and expectation of negative interest rates in the next year in US. Today, Gold may trade on a positive side. Traders can buy gold at 45,900 levels with the stop loss of 45,650, for the target of 46,500 levels. In international market, Gold may test $1730 levels.

11:12 AM

India's credit profile to face further pressure due to Covid-19: Moody's

India's credit profile will face further pressures amid the coronavirus outbreak, according to rating agency Moody’s. The shock will exacerbate an already material slowdown in economic growth, which has significantly reduced prospects for durable fiscal consolidation, Moody’s said in credit opinion. Moody’s rating on the government of India is Baa2 with negative outlook. READ MORE

11:07 AM

MARKET CHECK | Hindalco Ind gains nearly 3%

11:04 AM

NEWS ALERT | Franklin Templeton India issues an apology to Sebi: CNBC TV18

-- says President and CEO of Franklin Templeton, Jenny Johnson, was 'quoted out of context' on a question regarding the winding up of six schemes offered in India

10:55 AM

BROKERAGE VIEW:: Edelweiss Securities on Automobiles

As OEMs brace for second consecutive year of (sharp) volume deceleration, we find these businesses resilient. This is reflected in higher or similar cash per share (as % of price) compared to GFC, despite a shallower price drop. Our bedrock analysis also indicates that even after 30-65% volume fall (from FY19 peak) and profit dip of 50-100%, OEMs can be FCF neutral. Since our note, Discount season, more clarity has emerged on the extent of COVID-19 impact. Hence we are in process of re-evaluating our forecasts. We believe FY21 will remain volatile, with any normalcy only in FY22. The recent sharp run-up in stock prices reflects part of the business resiliency. In such an environment, we favour businesses that address utility over aspiration, have a product cycle and availability of finance tailwind & valuation support. Our top picks remain Eicher Motors (EIM), Hero MotoCorp (HMCL) and Tata Motors (TTMT). Since the aforementioned note, they have returned ~-3%, ~25%, and ~22%, respectively, compared with ~12% for S&P BSE Auto.

10:48 AM

BROKERAGE VIEW:: HDFC Securities on HCL Tech

Maintain BUY on HCL Tech (HCLT) based on relative outperformance, in-line 4Q rev, operational improvement and business durability (large deals, infra services, software business). HCLT’s software portfolio and strong presence in infra services (cloud migration, virtual workplace, endpoint management) will mitigate the near-term headwinds of volume/price compression & deferrals. Our TP of Rs 565, values HCLT at a modest 12x FY22E EPS (3-6% EPS increase).

10:44 AM

BUZZING STOCK:: ICICI Bank at day's high

10:40 AM

BROKERAGE VIEW:: ICICI Securities on Cyient

The company is taking significant steps on the cost side to right size the cost structure for lower revenues (involuntary attrition was 9.8% in Q4FY20) and expects EBIT margin to recover to Q4FY20 levels of 8.4% by Q2FY21. Margins should further improve to around Q3FY20 level of 9.6% in H2FY21. Our revised estimates remain conservative relative to such expectations. Since majority of the revenue decline is expected to come through volumes and not pricing, that makes it easier for the company to manage profitability. We now expect USD revenues to decline by 18% in FY21 (from 13.4% decline earlier) with EBIT margins left unchanged from earlier at ~7.5%. Maintain BUY rating as valuation of 7.2x FY22E EPS is already adequately capturing the severeness of near-term implosion in fundamentals.

10:35 AM

RBL Bank gains 4% on strong Q4 operating performance; analysts maintain buy

Shares of RBL Bank advanced 3.9 per cent to Rs 134 per share on the BSE on Friday after the bank clocked string operating performance in the March quarter of FY20 (Q4FY20) despite the Covid-19 related concerns. The lender logged a healthy 37 per cent year-on-year (YoY) growth in its operating profit at Rs 765 crore compared to Rs 560 crore a year ago. READ MORE

10:27 AM

BROKERAGE VIEW:: Nomura on SBI Life

RATING: BUY | TARGET PRICE: 870

We expect a 5% decline in APE in FY21F, but an improving protection mix supporting VNB (largely flat in FY21F). Despite our muted expectations for the near term, we remain bullish on the longer term compounding story and believe SBI Life’s distribution strength will continue to aid market share gains, while lower cost ratios and improving persistency/business mix will aid VNB margins. Our TP of INR870 implies 2.4x/23x FY22F EV/VNB (1.95x FY22F EV currently). We expect the valuation gap to widen vs IPRU (IPRU IN, Neutral) given lower cyclicality expected in the savings business. A higher-than-expected decline in volumes remains a key downside risk.

10:23 AM

HUL surges 4% after Societe Generale buys 129 million shares via bulk deal

Hindustan Unilever (HUL) shares rose 4 per cent to Rs 2,075 apiece on the National Stock Exchange (NSE) on Friday after institutional investors bought stake in the fast moving consumer goods (FMCG) company via open market on Thursday. The stock recovered 9 per cent from its Thursday’s low of Rs 1,902 touched in early morning deal. READ MORE

10:18 AM

BROKERAGE VIEW:: Prabhudas Lilladher on HCL Tech

Rating: HOLD | CMP: Rs 512 | TP: Rs 548

HCLT has executed best in FY20 as compared to peers, revenue growth of 16.7% above initial guidance of 14-16% enabled by execution on strong set of deal wins in 2HFY19. Inorganic growth of 10.7%. We marginally fine tune our estimates & now value HCLT on 12X (earlier 11x) to arrive at a changed target price of Rs.548. Stock currently trades at attractive multiple of 11.3x on FY22E. Maintain HOLD. 

10:16 AM

BROKERAGE VIEW:: Prabhudas Lilladher on Hindalco Ind

Rating: BUY | CMP: Rs 118 | TP: Rs 170

 

Novelis consistently delivered across the parameters with consistent earnings growth (10% EBITDA CAGR over FY15-FY20), balanced product basket and strong B/S (Net debt/EBITDA at 2.1x). Admittedly, Aleris would face significant headwinds in FY21e due to its exposure to Aerospace and building & construction segments. However, niche product basket and higher infra spending in US would revive earnings in FY22e. In wake of attractive valuations, comfortable B/S and better earnings outlook, we reiterate BUY with TP of Rs 170, EV/EBITDA of 5.7x FY21e.

10:10 AM

Dr Reddy's hits 52-week high after USFDA issues EIR for Srikakulam facility

Shares of Dr Reddy’s Laboratories rallied 8 per cent and hit a 52-week high of Rs 4,132 on the National Stock Exchange (NSE) on Friday after the company received the Establishment Inspection Report (EIR) from US health regulator for its manufacturing plant at Srikakulam. The drug maker's stock surpassed its previous high of Rs 4,095, touched on April 22, 2020. READ MORE

10:05 AM

Rupee opening

Rupee opens higher at 75.42/$ vs Wednesday's close of 75.76 against the US dollar