MARKET WRAP: Sensex ends 224 pts lower on global cues, fall in bank stocks
Banks were the top losers on Monday, with Nifty PSU Bank index falling over 3%, while Nifty Bank index slipped over 1%
 "Stock market")
1:28 PM
Sun TV Network dips 6% after June quarter results
Shares of Sun TV Network have slipped 6% to Rs 776 per share on the BSE, after the company reported 63% year-on-year (YoY) growth in net profit at Rs 4.09 billion in June quarter (Q1FY19) driven by strong performance from its IPL franchise. The revenue was up 42% at Rs 11.20 billion on YoY basis. READ MORE
1:11 PM
FUND PICK UTI Regular Savings Fund: Conservative on risk, superior on return
The fund was launched in December 2003 as UTI-MIS Advantage Plan. Subsequent to the re-categorisation of mutual fund (MF) schemes by the Securities and Exchange Board of India (Sebi), it was renamed UTI Regular Savings Fund in May this year.
The fund has featured in the top 30 percentile in the conservative hybrid funds category of CRISIL Mutual Fund Rankings (CMFR) for the two quarters ended June 2018. READ MORE
12:58 PM
United Breweries rallies 7% on strong Q1 results
United Breweries (UBL) rallied 7% to Rs 1,286 on the BSE in intra-day trade after the company reported healthy 37% year-on-year (YoY) increased in net profit at Rs 2,219 million in June quarter (Q1FY19). Revenue grew 11.2% at Rs 18.66 billion on YoY basis.
The company reported 12% volume growth compared with industry average growth of 9% during the quarter. READ MORE
12:43 PM
MARKET COMMENT Rushabh Maru - Research Analyst , Anand Rathi Share on rupee
Emerging market currencies have declined sharply as Turkish lira has fallen to all time low level after US president Donald Trump imposed sanctions and tariffs on Turkey. The crisis is unlikely to resolve anytime soon. An absence of aggressive intervention by the RBI has also hurt the rupee.
Market is nervous ahead of India’s CPI data due later today. The dollar has strengthened to multi-month high on expectations of aggressive interest rate hikes by the Federal Reserve in coming months as the US economy is experiencing strong growth momentum. Hence, due to all these factors, the rupee has declined to all time low level today
Emerging market currencies have declined sharply as Turkish lira has fallen to all time low level after US president Donald Trump imposed sanctions and tariffs on Turkey. The crisis is unlikely to resolve anytime soon. An absence of aggressive intervention by the RBI has also hurt the rupee.
Market is nervous ahead of India’s CPI data due later today. The dollar has strengthened to multi-month high on expectations of aggressive interest rate hikes by the Federal Reserve in coming months as the US economy is experiencing strong growth momentum. Hence, due to all these factors, the rupee has declined to all time low level today
12:31 PM
HDFC Securities on Jamna Auto
We have cut EPS estimates by 6% for FY19/20 factoring in margin pressure and increase in depreciation and interest cost. Expect revenue/EPS growth of 17/27% over FY18-20E.Given the superior return ratios, ROE(+30%),and phenomenal growth, JAMNA will continue to trade at premium vs its historical multiple(15x). We value the stock at Rs 100 (20xFY20E) vs 107 earlier. Maintain BUY.
We have cut EPS estimates by 6% for FY19/20 factoring in margin pressure and increase in depreciation and interest cost. Expect revenue/EPS growth of 17/27% over FY18-20E.Given the superior return ratios, ROE(+30%),and phenomenal growth, JAMNA will continue to trade at premium vs its historical multiple(15x). We value the stock at Rs 100 (20xFY20E) vs 107 earlier. Maintain BUY.
12:31 PM
HDFC Securities on Jamna Auto
We have cut EPS estimates by 6% for FY19/20 factoring in margin pressure and increase in depreciation and interest cost. Expect revenue/EPS growth of 17/27% over FY18-20E.Given the superior return ratios, ROE(+30%),and phenomenal growth, JAMNA will continue to trade at premium vs its historical multiple(15x). We value the stock at Rs 100 (20xFY20E) vs 107 earlier. Maintain BUY.
We have cut EPS estimates by 6% for FY19/20 factoring in margin pressure and increase in depreciation and interest cost. Expect revenue/EPS growth of 17/27% over FY18-20E.Given the superior return ratios, ROE(+30%),and phenomenal growth, JAMNA will continue to trade at premium vs its historical multiple(15x). We value the stock at Rs 100 (20xFY20E) vs 107 earlier. Maintain BUY.
12:24 PM
MARKET COMMENT Rabobank International on developments in Turkey
Turkey is almost certain to need a bail-out ahead: the key issue is, in which currency? If it is via the IMF it will be in USD, as usual, and with all the usual strings attached: austerity, privatisation, reforms, and pro-US foreign policy.
If it is from ‘new friends’ Russia or China, things will look very different. Loans would be in RUB or CNY, and would be a huge step towards de-dollarization and Turkey’s financial, economic, political, and yes, military reorientation eastwards. That is Great Power and Great Currency hand in hand - and Turkey is neither
Turkey is almost certain to need a bail-out ahead: the key issue is, in which currency? If it is via the IMF it will be in USD, as usual, and with all the usual strings attached: austerity, privatisation, reforms, and pro-US foreign policy.
If it is from ‘new friends’ Russia or China, things will look very different. Loans would be in RUB or CNY, and would be a huge step towards de-dollarization and Turkey’s financial, economic, political, and yes, military reorientation eastwards. That is Great Power and Great Currency hand in hand - and Turkey is neither
12:14 PM
KR Choksey Institutional Equities on Suzlon
The prolonged timeline for settling grime has impacted Suzlon’s financial performance since last few quarters. We believe commissioning can ramp up post Q3FY19 and hence one can expect FY19 to be washout year as FY18.
On the other side, it is expected that SECI VI will open in Aug’18 and Suzlon historically garnered 25% market share in terms of overall order wins. Thus, this improves order backlog visibility in the coming period. Apart from this, the company is already into advance negotiation with few IPPs for 20% of the earlier 7.5GW auctioned orders; any positive surprise can augur well for the company going ahead.
On the other side, it is expected that SECI VI will open in Aug’18 and Suzlon historically garnered 25% market share in terms of overall order wins. Thus, this improves order backlog visibility in the coming period. Apart from this, the company is already into advance negotiation with few IPPs for 20% of the earlier 7.5GW auctioned orders; any positive surprise can augur well for the company going ahead.
We have lowered FY19E estimates, while maintained FY20E estimates. We valued the company on SOTP basis and arrived a target price of Rs 15.8, upside potential of 119%. We retain BUY rating on the stock.
12:09 PM
TOP GAINERS & LOSERS IN THE FINANCIAL SECTOR (BSE)
» More
| COMPANY | LATEST() | CHG() | CHG(%) | VOLUME |
|---|---|---|---|---|
| PUNJAB NATL.BANK | 82.10 | -1.05 | -1.26 | 1636205 |
| ST BK OF INDIA | 296.25 | -8.20 | -2.69 | 1289253 |
| IDFC BANK | 44.35 | 1.05 | 2.42 | 619101 |
| IDBI BANK | 61.55 | -0.30 | -0.49 | 458254 |
| BANK OF INDIA | 91.65 | -1.85 | -1.98 | 425399 |
12:08 PM
Anand Rathi on Hinduja Global
In line with estimates, HGS’ Q1 revenue was $165m (down 2% q/q, up 6% y/y, adj for acquisition) but the 6.6% margin (down q/q, 416bps y/y) disappointed. The acquired entities saw a sharper decline in revenue ($17m/qtr disclosed on acquisition but the current rate is only $12m).
Consequently, EBITDA loss in the acquired entity was $3.6m, adjusting for which HGS had 9.5% EBITDA margins. Recovery will be slow and contingent on revenues scaling up. We cut our FY19e and FY20e ~15-16%, leading to a revised target of Rs 990 (9x FY20 EPS)
In line with estimates, HGS’ Q1 revenue was $165m (down 2% q/q, up 6% y/y, adj for acquisition) but the 6.6% margin (down q/q, 416bps y/y) disappointed. The acquired entities saw a sharper decline in revenue ($17m/qtr disclosed on acquisition but the current rate is only $12m).
Consequently, EBITDA loss in the acquired entity was $3.6m, adjusting for which HGS had 9.5% EBITDA margins. Recovery will be slow and contingent on revenues scaling up. We cut our FY19e and FY20e ~15-16%, leading to a revised target of Rs 990 (9x FY20 EPS)
12:06 PM
Investec Securities on Sun TV
Sun reported strong 1Q rev growth of 42% yoy and EBIT growth of 70% yoy, beat on consensus, led by IPL franchise (Rs2.2bn EBIT vs our expectation of Rs1bn). Core broadcast BU weak with 14% rev growth and flat EBIT (margin declined 690bps) – all the cost lines were elevated, especially film costs (D&A expenses up 42% yoy). The company noted one-off costs of Rs0.5bn related to its 25th anniversary.
To us, the deal-breaker (or maker) remains declining shares across key markets (Tamil/Telugu). Factoring in IPL gains in FY19E and beyond, we increase estimates 2-3%; new target price Rs880 (Rs870 earlier)
Sun reported strong 1Q rev growth of 42% yoy and EBIT growth of 70% yoy, beat on consensus, led by IPL franchise (Rs2.2bn EBIT vs our expectation of Rs1bn). Core broadcast BU weak with 14% rev growth and flat EBIT (margin declined 690bps) – all the cost lines were elevated, especially film costs (D&A expenses up 42% yoy). The company noted one-off costs of Rs0.5bn related to its 25th anniversary.
To us, the deal-breaker (or maker) remains declining shares across key markets (Tamil/Telugu). Factoring in IPL gains in FY19E and beyond, we increase estimates 2-3%; new target price Rs880 (Rs870 earlier)
12:05 PM
Emkay on Aurobindo Pharma
Q1FY19 was marred by write-offs relating to shelf stock adjustment, which is largely non-recurring in nature. Adjusted for the same, numbers are strong, especially given the current challenging business environment. Return ratios for ARBP are the highest among its comparable peers. We maintain BUY rating with a Target Price (TP) of Rs690, valuing it at 15x on FY20E EPS of Rs46
Q1FY19 was marred by write-offs relating to shelf stock adjustment, which is largely non-recurring in nature. Adjusted for the same, numbers are strong, especially given the current challenging business environment. Return ratios for ARBP are the highest among its comparable peers. We maintain BUY rating with a Target Price (TP) of Rs690, valuing it at 15x on FY20E EPS of Rs46
12:00 PM
Markets at noon
> More on NSE Indices
| INDEX | LATEST | PREVIOUS | CHANGE | CHANGE(%) |
| NIFTY 50 | 11360.05 | 11429.50 | -69.45 | -0.61 |
| NIFTY 500 | 9666.05 | 9724.45 | -58.40 | -0.60 |
| NIFTY MIDCAP 100 | 19049.60 | 19135.95 | -86.35 | -0.45 |
| NIFTY SMALL 100 | 7466.25 | 7537.30 | -71.05 | -0.94 |
| INDIA VIX | 13.42 | 12.85 | 0.57 | 4.44 |
11:45 AM
Investors should avoid MFs with high expense ratios: All you need to know
Avoid paying a high expense ratio in categories where the scope for generating high outperformance doesn't exist Former Sebi chief U K Sinha recently said that India's mutual fund industry is among the most expensive globally and there is scope for bringing down costs The bottomline, according to experts, is that a high expense ratio is justified only in products that manage to generate high alpha Actively-managed equity funds in India have traditionally generated high alpha. READ MORE
11:31 AM
Tata Motors, Tata Motors DVR hit 52-week low on drop in global sales
Shares of Tata Motors and Tata Motors (DVR) have hit their respective 52-week lows after the company reported 5% drop in global sales, including that of Jaguar Land Rover (JLR), to 92,639 units in July.
“Global wholesales of all Tata Motors’ commercial vehicles and Tata Daewoo range in July 2018 were at 40,443 units, higher by 29%, over July 2017,” the company said in a regulatory filing. READ MORE
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First Published: Aug 13 2018 | 8:15 AM IST
