Brokers trade at their computer terminals at a stock brokerage firm in Mumbai (
The domestic stock market ended over 1.5 per cent higher on Monday, lifted by across-the-board gain.
Among headline indices, the S&P BSE Sensex jumped 593 points, or 1.59 per cent to 38,982 levels. Of 30 constituents, 27 advanced and the rest 3 (Nestle India, Infosys, and Hindustan Unilever) declined. The Nifty50 index reclaimed the 11,200-mark to settle at 11,228, up 177 points, or 1.6 per cent. India VIX dropped over 5 per cent to 19.57 levels.
In the broader market, the S&P BSE MidCap index rallied 2.68 per cent to 14,721 while the S&P BSE SmallCap index ended at 14,863.25, down 368 points, or 2.54 per cent.
On the NSE, all the sectoral indices ended in the green. Nifty Bank gained 3.26 per cent to 21,665.50 levels while Nifty Metal index rose nearly 3 per cent to 2,237 levels.
Asian markets gained on Monday amid signs China’s economic recovery was gaining momentum with pent-up demand, fiscal stimulus and surprisingly resilient exports boosting sentiment across the region. MSCI’s broadest index of Asia-Pacific shares outside Japan advanced 0.7 per cent to 551.48, but stayed within striking distance of a two-month low of 543.66 hit last week.
In Europe, stocks partially recovered from last week’s hefty losses, helped by upbeat industrial profits data from China and as banking stocks bounced off record lows.
In commodities, oil prices fell as rising coronavirus cases spur concern about demand, with the main crude benchmarks on track for their first monthly falls since April.
MARKET COMMENT | Vinod Nair, Head of Research at Geojit Financial Services
"Indian benchmark indices gained strength throughout the day, helped by gains in banking and financial stocks. Global cues were also positive following positive industrial profits data from China, setting aside concerns about the increasing virus infections and related impact. Indian markets were also banking on further stimulus and other measures by the government to boost the economy. Traders limit overnight positions and keep booking profits while investors follow an accumulation strategy."
SECTOR WATCH | All sectoral indices on the NSE end in the green
MARKET AT CLOSE | Gainers and losers on the S&P BSE Sensex
The S&P BSE Sensex surged 593 points, or 1.59 per cent to settle at 37,982 levels while NSE's Nifty ended at 11,228, up 177 points, or 1.6 per cent.
IndusInd Bank up 8%
Sun Pharma closes share buyback offer period; stock jumps 5%
Shares of Sun Pharmaceutical Industries moved higher by 5 per cent to Rs 512 on the BSE on Monday after the company announced closure of buyback of equity shares of the company on Friday, September 25, 2020. The pharmaceutical company has not purchased any shares under buyback offer as the market price was higher than the buyback price. READ MORE
MARKET CHECK | Top losers on the BSE at this hour
MARKET UPDATE:: Broader indices outperform benchmarks
Location data, goods moved: More weekly indicators on economy turn positive
Analysts worldwide look at more current indicators to sense the situation on the ground. A lot of the macroeconomic indicators like gross domestic product (GDP) are released with a lag. Business Standard tracks a set of high-frequency indicators on a weekly basis. This includes emission levels, power generation and traffic congestion in key cities. All the data is as of Sunday, September 27. Google’s mobility data is also included, though it is released with a lag. The latest Google data is as of September 21. READ MORE
NEWS ALERT :: Lupin launches generic of Emend injectable drug in the US
>> It is used with other medications to help prevent nausea and vomiting caused by cancer drug treatment
European markets check
Rupee ends weaker at 73.79 per US dollar vs Friday's close of 73.61/$
MARKET CHECK :: Indices at day's high
NEWS ALERT :: RBI MPC meeting to be rescheduled
>> The meeting of the Monetary Policy Committee (MPC) during September 29, 30 and October 1, 2020 as announced is being rescheduled. The dates of the MPC’s meeting will be announced shortly.
NEWS ALERT :: Gateway Distriparks approves merger with Gateway East India
Shares of ITC were trading firm at Rs 173, up 1 per cent, on the BSE on Monday despite the Maharashtra government banning the sale of loose cigarettes and beedis, making it the first state to do so. The stock of the fast moving consumer goods (FMCG) company, however, underperformed the S&P BSE Sensex, which up 1.4 per cent at 37,919 points at 01:10 pm. READ MORE
ICRA downgrades TAJGVK's credit ratings of long-term loans, others
TAJGVK Hotels and Resorts on Monday said domestic rating agency ICRA has downgraded the credit ratings of its long-term loans and short-term credit facilities on account of revenue and margin decline in the current fiscal due to the Covid-19 pandemic. READ MORE
Bond traders in India brace for likely borrowing hike to Rs 6 trillion
Traders expect the government to lift its borrowing estimate for the October-March period to six trillion rupees ($81.5 billion) from the existing 5 trillion rupees, according to 10 out of 16 traders in a Bloomberg survey. The timing for this increase couldn’t be worse as the Reserve Bank of India is set to keep its policy rates on hold on Thursday amid a persistently high inflation. READ MORE
RBI Policy :: MPC likely to keep interest rates unchanged
As regards the next policy review, industry body Confederation of India Industry said: “The RBI should maintain its accommodative stance, while avoiding a rate cut for now given the stickiness in CPI inflation. While supporting growth is critical, the RBI could wait till there is some visible moderation in inflation.” Expressing similar opinion, Assocham Secretary General Deepak Sood said the Reserve Bank should continue in a more pronounced way the accommodative stance on the policy interest rates in the wake of serious challenges due to contraction in the economy induced by the Covid-19 pandemic. READ MORE
Tyre stocks in focus; Balkrishna Ind rallies 9%, hits fresh record high
Balkrishna Industries Limited (BIL) is engaged in the business of manufacturing and selling of Off-Highway Tyres (OHT) in the specialist segments such as agricultural industrial and construction earthmovers and port mining forestry lawn and garden and All Terrain Vehicles (ATV). READ MORE
Even though it may still be some time away, the firm believes the strategy it has put in place and investments it has made in the past couple of years will help it achieve the target sooner than later. “Infosys is becoming the bellwether again,” Nandan Nilekani, chairman of Infosys, told Business Standard. READ MORE
MARKET CHECK | Top gainers on the BSE at this hour
Tariff hikes, gas volume uptick positive for Gujarat Pipavav Port
Though weak volumes may weigh on Gujarat Pipavav Port’s near-term revenues, the Street is expecting the recent price hikes, expansion plan, and commissioning of the Western Dedicated Freight Corridor (WDFC) to boost medium-term prospects.
The firm, owned by Danish integrated container logistics major AP Moller-Maersk Group, recently announced a tariff hike, which adjusted for discounts and rebates, would work out 6-7 per cent higher on a blended basis for container cargo. READ MORE
Festival boost: Home appliance makers look to regain some lost ground
Consumer durables and electrical appliances companies remain in focus with the approaching festival season. Havells announced entry into the refrigerators segment under Lloyds brand recently. After a weak first half of FY21 — with summer season sales in the June quarter getting impacted due to the lockdown, and the September quarter being seasonally weak — the upcoming festival season is likely to see companies regain some lost ground, said analysts. READ MORE
India may be one of the most vulnerable EMs, say Lambregts & Erken
London-based Jan Lambregts , managing director and global head of financial markets research, Rabobank International, and Hugo Erken, head of international economics, RaboResearch Global Economics & Markets, tell Puneet Wadhwa that EMs may struggle in the short term on the back of rising geopolitical developments, which will likely cause a shift towards risk-off sentiment and capital outflows. READ FULL INTERVIEW HERE
Our earnings estimates are unchanged; modelling revenue / EBITDA / PAT CAGR of 11 / 16 / 15 (%) over CY19-21E. Maintain HOLD rating with DCF-based target price unchanged at Rs 16,500. Key upside risk is greater-than-expected deflation in inputs and key downside risk is potential regulatory disruption in infant nutrition.
UTI AMC IPO: Investors shouldn't expect significant gains in near-term
The UTI Asset Management Company’s (UTI) initial public offering (IPO) looks attractive given the over 30 per cent discount to listed players, but investors shouldn't expect significant gains in the near-term. The reason: lack of favourable assets under management (AUM) mix, sharp uptick in retail business and cost optimisation. READ MORE
BROKERAGE VIEW | Axis Securities on Biocon
RATING: BUY | TARGET PRICE: Rs 474
Biocon has a strong pipeline of biosimilars to be launched over next 3-5 years across various markets. Given its record, the biosimilar products have good potential to garner market share despite the competition. We recommend to BUY with a target price of Rs 474.
Escorts hits new high as Co starts commercial production of Kubota tractors
Shares of Escorts rallied 7 per cent to Rs 1,284.45, also its record high on the BSE on Monday after the company announced the commissioning of manufacturing operations of a joint venture (JV) with Kubota Corporation on Friday, September 25, 2020. The stock surpassed its previous high of Rs 1,280, touched on September 18, 2020. READ MORE
BROKERAGE VIEW | LKP Securities on ZEEL
RATING: BUY | TARGET PRICE: Rs 268
We believe that revenues and EBITDA are bottomed out in Q1 and will witness a significant improvement hereon. We expect a 600 bps improvement from Q1 levels to FY 21E. Zee’s multiples over the last 12-15 months were depressed considering promoter group issue (pledge shares) and balance sheet concerns (rising inventories and receivables).With Q1 results all of these concerns are allayed due to which we expect Zee’s multiples to expand. Our FY 22E price target of ₹268 is based on a PE multiple of 15x as compared to a historical PE of 25x-30x.
BROKERAGE VIEW | Edelweiss Securities on Bajaj Electricals
RATING: BUY | TARGET PRICE: Rs 600
We believe BJE will be a key turnaround story as its EPC pain—on both balance sheet and valuation multiple—subsides. This would benefit profitability owing to a gradual expansion in margins and a decline in interest cost. Despite recent improvements in BJE’s cash flow, we remain cautious on retention/project receivables, evident in our conservative valuation framework. Incremental deterioration of the balance sheet from EPC business remains an overarching risk to our call.
Interest Waiver Case :: Matter will be heard and decided on Oct 5, says SC
>> SC observes, Govt has urged that decision will be finalized in 2-3 days
>> Govt is directed to file its reply by Friday, so that decision of Govt is communicated to all sides.
Interest Waiver Case :: Govt needs 3 more days; decision making at advanced stage, says Solicitor General
>> Matter has received due consideration from the Govt
>> Complex issue, various economic issues need to be considered.
Surya Roshni shares rally 10% on order wins worth Rs 273 crore
Shares of Surya Roshni rallied 10 per cent to Rs 212.85 on the BSE on Monday after the company received orders worth Rs 273 crore from state-owned oil & gas companies. The stock was also trading close to its 52-week high of Rs 214, hit on September 21, 2020. “The company has obtained orders aggregating to Rs 272.86 crore (excluding GST) for the supply of coated API line pipes to GAIL (India) and Indradhanush Gas Grid (IGGL) for North-East gas grid pipe line project,” Surya Roshni said in a exchange filing. READ MORE
PVR, Inox Leisure gain as cinema halls to reopen in West Bengal from Oct 1
"To return to normalcy, Jatras, Plays, OATs, Cinemas & all musical, dance, recital & magic shows shall be allowed to function with 50 participants or less from 1 Oct, subject to adherence to physical distancing norms, wearing of masks and compliance to precautionary protocols," the chief minister said on Twitter. READ MORE
LVB slips 6% as shareholders vote against reappointment of top brass
Shares of Lakshmi Vilas Bank (LVB) slipped 6 per cent to Rs 18.10 on the BSE in intraday trade on Monday, after a large section of shareholders of ailing private sector lender voted against the reappointment of the managing director and chief executive, as well as seven directors and auditors at the recent annual general meeting (AGM). READ MORE
Rupee opens at 73.64 per US dollar vs Friday's close of 73.61/$
HDFC twins the lead contributors to Sensex's gain today
Indoco Remedies rallies 9% after launching Covid treatment drug
Fevindo-400 (Favipiravir) is an antiviral drug, effective against the RNA‐based influenza virus. The drug has been approved by DCGI in the treatment of Covid-19. The drug reduces pill burden by 50 per cent and ensures convenient dosing and better patient compliance, Indoco Remedies said in press release on Saturday. READ MORE
Auto stocks gain momentum
Thomas Cook skids 2.5%
>> In a regulatory filing, the company informed that the company's board has approved the withdrawal of the buyback.
Sector Watch :: Nifty IT slips in a strong market
Indoco Remedies jumps 6%
>> The drug maker on 26 September 2020 announced the launch of Fevindo (Favipiravir) 400 mg tablets in India. Fevindo-400 (Favipiravir) is an antiviral drug, effective against the RNA‐based influenza virus. The drug has been approved by DCGI in the treatment of Covid-19.
Banking stocks trade strong ahead of interest waiver hearing
Vodafone Idea extends gains into second day
PVR jumps 4% as theatres to open in West Bengal from Oct 1
Surya Roshni leaps over 6.5% on new orders
>> The company has obtained orders aggregating to Rs 272.86 crore (excluding GST) for the supply of Coated API Line Pipes to GAIL (India) and Indradhanush Gas Grid (IGGL) for North-East Gas Grid Pipe Line project.
Lakshmi Vilas Bank dips 1%
>> A large section of shareholders of ailing Lakshmi Vilas Bank (LVB) voted against the reappointment of the managing director and chief executive, as well as seven directors and auditors, at the recent annual general meeting (AGM).
Sectoral trends at Open
Sensex Heatmap at Open
Strong support exists for Nifty at 10,900: CapitalVia Global Research
Markets traded with bullish mode on the first day of October series on firm global cues. Volatility Index, India VIX, dropped 12.06 per cent and closed at 20.6750, which shows some relief to bulls as volatility is likely to come down. Nifty managed to close at 11,050.30, adding 244.80 points. IT, Auto, and private banks along with financial stocks traded with positive sentiments whereas no index closed in the red. Nifty bank closed at 20,982.35, adding 525.50 points from the previous day’s closing. READ MORE
Top gainers and losers on the S&P BSE Sensex at Pre-open
Markets at Pre-open
Markets at Pre-open
BROKERAGE VIEW :: MOFSL on Aurobindo Pharma
CMP: Rs 772 | TP: Rs 1030 (+33%) | Reco: BUY
>> The Aurobindo Pharma (ARBP) stock has corrected ~20% over the past two months. This, we believe, provides a good entry opportunity in the stock.
>> Multiple factors strengthen our positive stance on the stock, such as: (a) the gradual improvement in outlook for the Injectable business, (b) ongoing efforts to build a complex product pipeline, (c) significantly reduced financial leverage, (d) completion of remediation measures at sites under regulatory issues, and (e) comfortable valuation (at 11.9x FY22E EPS of Rs 65 compared to 5-year average of 16x).
>> We expect ARBP to deliver 15% earnings CAGR over FY20-22E, led by new launches/increased market share in its key markets of the US/EU and lower financial leverage. We value ARBP at 16x 12M forward earnings to arrive at a target price of Rs 1,030. Re-iterate Buy.
BROKERAGE VIEW :: MOFSL on ITC
CMP: Rs 171 | TP: Rs 185 (+8% ) | Reco: Neutral
>> The news on the Maharashtra ban on loose cigarettes, while very difficult to implement, could affect cigarette volumes (if the implementation is extensive and stringent).
>> Loose cigarettes contribute 70–80% to cigarette volumes across various states.
>> Maharashtra is among the large states in terms of cigarette consumption. Moreover, the impact would be higher if other states follow suit either in the near term or later.
>> The news of the ban on loose cigarettes only adds to other concerns, such as: (a) persistent global ESG concerns on cigarettes (84% of EBIT in FY20), (b) the overhang of a further GST increase on cigarettes, and (c) a continued weak earnings trajectory (6.6% PBT CAGR over the last five years). The stock is trading at 13.5x FY22E EPS on our current forecasts. This may be affected by the negative impact of Maharashtra’s loose cigarette ban (if implemented stringently) or any potential steep GST increase. We value ITC at 14x Sep’22E EPS (a ~20% premium to global peers’ average multiple) to arrive at TP of INR184. Maintain Neutral.
BROKERAGE VIEW :: MOFSL on Steel sector
>> India’s steel sector has turned the corner with recovery in domestic demand and improved margins. This is led by sharp price hikes (supported by higher regional steel prices, particularly for flat steel) and lower raw material cost (despite recent rise).
>> On account of a higher price rise in flat steel v/s long steel, gross margin per ton for HRC is currently ~18% higher than pre-COVID levels and flattish for rebar.
>> However, we believe the regional (and thus India) HRC price is unlikely to rise further as we expect the price of key raw material iron ore to correct in the subsequent months. Iron ore supplies from Brazil have been normalizing, and port inventories in China have been rising, which does not bode well for iron ore prices, in our view. China HRC price has already corrected by 4% in Sept due to a 6% decline in iron ore price – the sharpest declines posted by both in the past five months.
>> Hence, we prefer long steel producer JSP (Buy, INR238 TP) over flat steel producers JSW Steel (Buy, INR300 TP) and Tata Steel (Neutral, INR380 TP). Over FY20-22E, JSP should also see a strong 16% CAGR in EBITDA and 37% decline in net debt.
SAD-NDA split unlikely to trigger wild moves in market; eye on US elections
The Shiromani Akali Dal pulling out of the NDA due to differences over the Farm Bills will not affect the political balance too much. The BJP has a majority in the Lok Sabha on its own. However, this is the third erstwhile ally, which has pulled out of the NDA after differences with the BJP in the not-too-distant past. The Biju Janata Dal broke away from the BJP before the 2019 assembly elections in Odisha, and of course, the Shiv Sena has also parted ways. READ MORE
Top stocks to watch out today
RIL: Reliance Industries Ltd (RIL) on Saturday said it has received Rs 7,500 crore from US private equity firm Silver Lake Partners, which has picked up 1.75 per cent stake in its retail arm.
Lakshmi Vilas Bank: A large section of shareholders of ailing Lakshmi Vilas Bank (LVB) voted against the reappointment of the managing director and chief executive, as well as seven directors and auditors, at the recent annual general meeting (AGM). READ MORE
FII/FPI & DII trading activity on NSE, BSE and MSEI
Oil edges lower as rising virus cases cloud demand recovery outlook
>> Oil prices dipped again on Monday as rising coronavirus cases upset hopes for a smooth recovery in fuel demand, with crude on track for its first monthly fall in many months after slipping last week.
>> Brent crude LCOc1 edged down 8 cents, or 0.2%, to $41.84 a barrel after dropping 2.9% last week. US West Texas Intermediate CLc1 was at $40.12 a barrel, down 13 cents or 0.3%, following a 2.1% decline last week.
SGX Nifty update
>> At 8:30 am, the index was at 11,106.20 level, up 74.30 points or0.67 per cent.
Asian markets check
Wall Street on Friday :: Wall Street ends higher as tech rally squashes virus fears