MARKET WRAP: Sensex rises 204 pts; YES Bank hits 52-week low; Jet gains 4%
Among the sectoral indices, the Nifty IT index settled 2.7 per cent higher led by a rise in MindTree, Infosys and Tata Consultancy Services (TCS) which rose in the range of 4 to 5.7 per cent.
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10:23 AM![]()
Edelweiss on NMDC
We perceive production halt at Donimalai as a major overhang. While the company is trying to sort the issue via mutual consultation, we believe the process is likely to take time. We estimate sales volume to be impacted by ~5mt if the production does not resume for rest of FY19.
While we are upbeat on visible volume uptick at NMDC, we remain cautious on the Donimalai issue as it is likely to keep stock performance muted. We await more clarity on the matter. We maintain ‘BUY/SO’ with target price of Rs 151. The stock is currently trading at an inexpensive 3.5x FY20E EBITDA
We perceive production halt at Donimalai as a major overhang. While the company is trying to sort the issue via mutual consultation, we believe the process is likely to take time. We estimate sales volume to be impacted by ~5mt if the production does not resume for rest of FY19.
While we are upbeat on visible volume uptick at NMDC, we remain cautious on the Donimalai issue as it is likely to keep stock performance muted. We await more clarity on the matter. We maintain ‘BUY/SO’ with target price of Rs 151. The stock is currently trading at an inexpensive 3.5x FY20E EBITDA
10:22 AM![]()
Jefferies on retail / consumer sector
We continue to prefer apparel retailers to grocery. Though grocery and value apparel segments are best positioned, valuations are factoring in all positives, in our view. Within the strong execution bucket, TRENT is the only Buy, as we have a Hold on DMART and VMART, given unfavorable risk-reward. We have a Buy on ABFRL, which, in our view, is better placed to face competition with its strong brand portfolio and improving balance sheet. We have a Buy on FLFL and SHOP for steady performance and turnaround story, respectively. Amid rising complexity, we maintain a Hold on FRETAIL
We continue to prefer apparel retailers to grocery. Though grocery and value apparel segments are best positioned, valuations are factoring in all positives, in our view. Within the strong execution bucket, TRENT is the only Buy, as we have a Hold on DMART and VMART, given unfavorable risk-reward. We have a Buy on ABFRL, which, in our view, is better placed to face competition with its strong brand portfolio and improving balance sheet. We have a Buy on FLFL and SHOP for steady performance and turnaround story, respectively. Amid rising complexity, we maintain a Hold on FRETAIL
10:22 AM![]()
Nomura on Make My Trip (MMT)
We are enthused by: 1) rationalization of discounting visible in our survey of hotels; 2) lower competitive intensity in H&P and MMYT’s established leadership, which we believe provides a road map to profitability; 3) strong underlying growth drivers for domestic air traffic & under-penetration in international air ticketing. Stock correction discounts risks significantly and valuations of ~3x 1 yr fwd EV/Sales are at historical lows & 40% discount to 5 year average. Upgrade to Buy.
10:20 AM![]()
Reliance Securities on Alkem Labs
We expect ALKEM’s domestic formulations biz (69% of sales) to clock 15% CAGR through FY18-20E driven by increasing focus on Chronic segments and new launches in key therapies. f ALKEM has a good track record of USFDA inspection. Looking ahead, we expect USFDA approvals to pick-up, as Alkem has received EIR for its Daman unit. Alkem’s pending pipeline stood at 65 ANDAs and plans to launch 8-10 products in FY19E. We expect US biz to clock 11% CAGR through FY18-20E.
We expect revenue/PAT to clock 13.7%/37.6% CAGR over FY18- 20E. ALKEM generates >85% of its total EBITDA margin from domestic biz. We expect EBITDA margin expansion of 394bps to 19.9% through FY18-20E driven by better product-mix and improved field force productivity and positive operating leverage.
Remain positive on the medium-to-long term growth prospects on the back of stable revenue growth from domestic business. Expect stock to command premium over its peers on account of healthy return ratios and higher exposure to India business. Maintain our BUY recommendation on the stock with a target price of Rs 2,400
We expect ALKEM’s domestic formulations biz (69% of sales) to clock 15% CAGR through FY18-20E driven by increasing focus on Chronic segments and new launches in key therapies. f ALKEM has a good track record of USFDA inspection. Looking ahead, we expect USFDA approvals to pick-up, as Alkem has received EIR for its Daman unit. Alkem’s pending pipeline stood at 65 ANDAs and plans to launch 8-10 products in FY19E. We expect US biz to clock 11% CAGR through FY18-20E.
We expect revenue/PAT to clock 13.7%/37.6% CAGR over FY18- 20E. ALKEM generates >85% of its total EBITDA margin from domestic biz. We expect EBITDA margin expansion of 394bps to 19.9% through FY18-20E driven by better product-mix and improved field force productivity and positive operating leverage.
Remain positive on the medium-to-long term growth prospects on the back of stable revenue growth from domestic business. Expect stock to command premium over its peers on account of healthy return ratios and higher exposure to India business. Maintain our BUY recommendation on the stock with a target price of Rs 2,400
10:18 AM![]()
Market check
| Index | Current | Pt. Change | % Change |
| S&P BSE SENSEX | 35,744.55 | +231.41 | +0.65 |
| S&P BSE SENSEX 50 | 11,232.43 | +65.09 | +0.58 |
| S&P BSE SENSEX Next 50 | 32,156.95 | +73.87 | +0.23 |
| S&P BSE 100 | 11,005.68 | +58.09 | +0.53 |
| S&P BSE Bharat 22 Index | 3,447.86 | -4.26 | -0.12 |
10:10 AM
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YES Bank falls 7% in two days as Moody's downgrades bank's rating
Shares of YES Bank have slipped 5% to Rs 174 per share on Wednesday, extending their 2.5% fall in the previous session on the BSE in an otherwise firm market, after the rating agency Moody's downgraded bank's rating and changed its outlook for the private lender from stable to negative. In past 10 trading days, YES Bank has underperformed the market by falling 23%, after the resignation of various members of the bank's board of directors. Read more
9:59 AM
NEWS ALERT Sintex Plastics Technology hits upper circuit
9:43 AM
Sintex Plastics Technology is trading 13% higher in early trade
9:38 AM
Nifty Realty index is trading over 1% lower weighed by Indiabulls Real Estate
9:31 AM
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Two large India-focused foreign funds trim exposure over oil, rupee, polls
India-focused funds based abroad are reshuffling their portfolios to deal with uncertainties that have crept up in recent months. Franklin Templeton Investment (Franklin India MF) reduced its exposure by $830 million (Rs 58.6 billion) in the September quarter. Aberdeen Global (Indian Equity Fund MF) pruned its exposure by $130 million (Rs 9.1 billion) in October. Read more
9:21 AM
YES Bank slips over 3% in early trade
9:19 AM
Sectoral trend on NSE
9:18 AM
Opening gainers and losers on the S&P BSE Sensex
9:16 AM
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Market at open
At 9:15 AM, the S&P BSE Sensex was trading at 35,611, up 98 points, while the broader Nifty50 was ruling at 10,709, up 23 points.
9:03 AM![]()
BOND ALERT 10-year Govt bond yield opens at 7.68% as compared to previous close of 7.73%
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First Published: Nov 28 2018 | 8:15 AM IST
