Indices close at record highs; Sensex ends above 40k-mark for first time

All that happened in the stock market

10:34 AM

NEWS ALERT | India May Nikkei Manufacturing PMI at 52.7 vs 51.8 (MoM)

10:33 AM

Metals, chemicals: Sectors that stand to benefit from US - China trade war

The unanticipated trade tensions that cropped up between two major economies in the world—the US and China— and spilled over other countires thereafter have since spooked the global capital markets.

Between May 5 and May 15, since the day Trump tweeted about his views on China till exit poll outcomes in India, the benchmark S&P BSE Sensex and the broader Nifty50 had lost 4 per cent with the indices seeing their worst ever selling streak of nine consecutive days. READ MORE

10:25 AM

Hero MotoCorp gains 4% on May auto sales numbers

Shares of Hero MotoCorp (HMCL) rose 4 per cent to Rs 2,790 on the BSE on Monday in early morning trade after the company reported a 13.5 per cent rise in sales to 652,028 units in May over the previous month. The company had sold 574,366 units in April 2019, it said in a BSE filing. At 09:59 am, HMCL was the largest gainer among the constituents of S&P BSE Sensex, which up 0.38 per cent at 39,865 points. READ MORE

10:08 AM

JM Financial Services on ONGC

RECO: HOLD

 

TARGET: Rs 185

 

ONGC debt has been increasing (mainly due to OVL) and current consolidated debt stands at Rs 1 trillion. We use sum of the part method and value core business with DCF (discounted cash flow) method to arrive at TP of Rs 185. We base our estimates on Brent crude price of USD 70 / bbl and forex of Rs 70 / USD. Key risk to the valuation is the lower crude oil production and increasing debt.

10:05 AM

Motilal Oswal Financial Services' top picks from large cap and mid-cap space

Large-Caps: SBI, ICICI Bank, Maruti, L&T, Infosys, Bharti Airtel, Coal India, Titan, Ultratech, HDFC Life

 

Mid-caps: Federal Bank, Indian Hotels, Siemens, ABFRL, Crompton Consumer, Ashoka Buildcon, JK Cement, Godrej Agrovet, Oberoi Realty.

10:00 AM

Motilal Oswal Financial Services on GDP growth

The headline growth of sub-6% in 4QFY19 will increase the pressure on the RBI to cut rates next week. However, the details suggest that base effect and a decline in farm sector account for the majority of slowdown in 4QFY19. Adjusting for the base effect, real GDP/GVA growth stood at 7%/6.8% and non-farm real GVA growth was also at 6.8% in 4QFY19. High base effect (of 8% growth in 1QFY19) will keep growth subdued in 1QFY20 as well with probable revival from 2QFY20, and thus, we expect real GDP growth to weaken further to ~6.6% in FY20.

9:57 AM

M&M dips after promoter's partial stake sale

9:56 AM

NEWS ALERT | Mahindra & Mahindra promoter sells 1.54% stake at Rs 648/share: CNBC TV18

9:55 AM

Momentum Picks by ICICI Securities

9:54 AM

Bajaj Auto gains after KTM and co agree on new electric vehicle alliance

9:54 AM

Jefferies' India strategy

The government juggled to a fiscal deficit of 3.4% of GDP in FY19 but a more daunting task awaits in FY20 with a Rs1tn or 50bps slippage likely even if GST collections rebound. The tight fiscal leaves monetary policy as key, therefore, to revive economic growth which also fell to a 5-yr low in 4QFY19 with most leading indicators still soft. We remain cautious, therefore, recognizing that stimulus may boost NT sentiment for Industrials (OW) & Discretionary (EW).

9:53 AM

YES Securities on KNR Constructions

RECO: BUY

 

TARGET: Rs 321

 

Earnings growth would likely remain healthy backed by high margin order book in hand. Also, Share Purchase Agreement (SPA) with Cube Highways to sell its entire stake in 3 HAM projects in a phased manner will allow KNR to focus on its core expertise of EPC. The stock is currently trading at 16x FY21E P/E. We remain bullish on the stock and maintain BUY with target price of Rs.321 (based on SOTP valuation).

9:52 AM

HSBC on GDP data

The softness in growth data is likely to continue into the next quarter (April-June 2019). 70% of the 40-odd activity indicators we track are slowing. Thereafter, we expect growth to pick up again to the 7% ballpark in 2H2019. There are three good reasons for this. One, a pick-up in activity as election-related uncertainties fade. Two, an improvement in banking sector liquidity. We find that the liquidity situation generally improves over the months of June-August. 

 

Three, we expect the RBI to remain supportive. We expect a 25bp rate cut in the June meeting, which would take the repo rate to 5.75%. Thereafter, we expect the RBI to maintain liquidity at a slight surplus.

 

If the intention is to raise the growth rate above 7%, capital and labour enhancing reforms will be necessary, in our view (for a more involved discussion, see: India: Reform and grow: The roads that will lead to 8%, 15 May 2019).

 

 

9:50 AM

YES Securities on Sadbhav Engineering

RECO: BUY

 

TARGET: Rs 305

 

With start of new projects and expected receipt of appointed dates by September 2019, we expect revenues to witness decent growth in FY20. Also, margin is likely to hover at ~12% given current mix of order book. Debt is likely to decline gradually from the current levels of ~Rs.14.7bn. At CMP, the EPC business trades at

valuation of 14x FY21 EPS. We recommend a BUY on the stock for target price of Rs 305.

9:50 AM

HDFC Securities: Maintain BUY on Sadbhav Engineering

After a muted 1HFY19 (2% degrowth YoY), SEL had started to show signs of recovery in 3QFY19, but 4QFY19 execution was exceptionally weak. We believe the SIPL deal will culminate in a complete strategic shift at SEL, with more focus towards an asset light EPC play in addition to the availability of a ready platform for offering HAM projects in future.

Around Rs 5.4bn (vs. 4.6bn QoQ) of SIPL loans could be returned back leading to a further debt reduction (Rs 14.9bn currently, +0.3bn QoQ) and free its hands for additional projects once NHAI bidding picks up (~Rs 60-80bn targeted in FY20E). We maintain BUY. Key risks (1) Delay in SIPL stake sale; (2) Slow order inflows; and (3) Further delay in appointed dates