MARKET WRAP: Sensex drops 855 pts from day's high on broad-based sell-off

Topics Markets | Coronavirus | PVR

Volatility index, India VIX, climbed over 2 per cent to 30.26 levels.
The domestic equity market slipped over a per cent on Tuesday amid across-the-board sell-off with the financials taking the biggest knock. Sentiment took a hit after Delhi Deputy Chief Minister Manish Sisodia said that by the July end, the total number of Covid-19 cases in the national capital will rise to over 550,000. 

The S&P BSE Sensex shed 414 points or 1.2 per cent to settle at 33,956.69 while NSE's Nifty ended at 10,047, down 121 points or 1.19 per cent. Nifty Bank lost 462 points or over 2 per cent to 20,724.90 levels. Volatility index, India VIX, climbed over 2 per cent to 30.26 levels. 

"Delhi's deputy CM has reportedly made a statement that the number of Covid-19 cases in Delhi may rise exponentially to around 5.5 lakh by end of July 2020. Trends in other affected metros like Mumbai, Ahmedabad, Pune, Chennai, etc won't be very different, " said Ajay Bodke, CEO & Chief Portfolio Manager (PMS) at Prabhudas Lilladher. 

Adding, "What happens if local governments start delaying the opening up of sectors that are perceived to help spread the disease by a few weeks if not a month or two. Caution is warranted in stocks in sectors such as multiplexes, malls, commercial reality, travel & luggage, hospitality, restaurants, etc, especially as they had moved rapidly in the last few weeks on the hope of benefiting from the lifting of lockdown."

In the broader market, the S&P BSE MidCap index ended at 12,557.50, down 26 points or 0.21 per cent and the S&P BSE SmallCap index declined 1 per cent to 11,846.05 levels. 

Sectorally, barring Nifty Pharma and Nifty FMCG stocks, all the other indices ended in the red. Nifty Metal and Nifty IT dropped over 1 per cent each while Nifty Media slipped over 3 per cent to 1,320.85 levels. On the contrary, Nifty Pharma gained nearly 2 per cent while Nifty FMCG ended flat at 29,524.90 levels, up 0.08 per cent. 

Buzzing stocks 

Shares of Adani Green Energy (AGEL) hit a new high of Rs 312.75, up 5 per cent on the BSE after the company said it has bagged the world's largest solar bid worth $6 billion. READ MORE

Shares of multiplex operators, PVR and Inox Leisure, came under selling pressure after reporting weak earnings for the quarter ended March 2020 (Q4FY20), impacted by the outbreak of Covid-19 in the last month of the quarter. At the close, PVR stock stood at Rs 1,087.25, down over 6 per cent while Inox Leisure slipped over 10 per cent to Rs 254 on the BSE. READ MORE 

Global markets

Asian stocks extended their winning streak for the ninth consecutive session on Tuesday and oil prices rose as the lifting of coronavirus lockdowns in many countries fed investor hopes of a relatively quick global economic recovery. Australia’s S&P/ASX 200 surged 2.6 per cent, China’s blue-chip CSI300 index advanced 0.7 per cent and Hong Kong’s Hang Seng index climbed 1.6 per cent. Japan’s Nikkei bucked the trend to be down 0.6 per cent. 

In Europe, shares inched lower as declines in UK’s British American Tobacco and banking stocks halted a rally driven by optimism over a global recovery from the coronavirus crisis.

In commodities, oil prices rose, boosted by hopes for a swift recovery in fuel demand as coronavirus lockdown measures are eased across the globe, but gains were capped by the spectre of persistent oversupply in the market.

(With inputs from Reuters)

LIVE UPDATES

MARKET COMMENT:: Vinod Nair, Head of Research at Geojit Financial Services

"Nifty again witnessed profit booking and resistance at its 100-DMA levels, which is around 10,300 and has been a crucial level for the index. The indices finally ended down by 1.3%. Banking index was the top sectoral loser and bluechip private banks contributed most to the losses in the benchmark indices. Our markets also seem to be driven by global cues and European markets opening in the red had an impact on our markets. US FOMC announcements tomorrow can have a bearing on the global markets."

SECTOR WATCH:: Pharma stocks bucked the trend; Nifty Pharma index up nearly 2%


MARKET AT CLOSE:: Losers and gainers on the S&P BSE Sensex


CLOSING BELL

The S&P BSE Sensex slipped 414 points or 1.2 per cent to 33,957 levels while NSE's Nifty ended at 10,047, down 121 points or 1.19 per cent. 

MARKET CHECK


MARKET UPDATE:: ICICI Bank slips over 3.5%


INDEX LOSERS:: RIL declines over 2%


Broader market check :: Midcaps outperform; S&P BSE MidCap index down 0.3%


HEATMAP:: Bajaj Finance, HDFC Bank top drags on Sensex at this hour


Internet speed to traffic data: What weekly indicators say about economy

Analysts began to track similar numbers after the lockdown in China, where the coronavirus outbreak is believed to have emerged from. Usual macroeconomic indicators, like trade and gross domestic product numbers, are often released after a gap and even then available only monthly or quarterly. The use of higher frequency indicators, like internet speed, has gained traction as a means of assessing the fast-changing situation on the ground. READ MORE

Nifty Bank plunges around 750 points from day's high


MARKET UPDATE :: Sharp slide in indices; Nifty below 10,100


Fall from intra-day high today

COMPANY DAY'S HIGH(RS) DAY'S LOW(RS) LATEST(RS) FALL(%)
VODAFONE IDEA 12.49 9.41 10.23 -18.09
RELIANCE INFRA. 25.40 21.60 21.70 -14.57
PRISM JOHNSON 50.30 43.00 43.55 -13.42
CHALET HOTELS 172.95 151.60 152.55 -11.80
SWAN ENERGY 126.00 112.40 112.60 -10.63
Click here for the full list

MARKET UPDATE :: Sensex skids over 200 pts


Exide Ind lags smaller peer Amara Raja in Q4 and FY20 at operational level

The stock of Exide Industries slid over 8 per cent on a weaker-than-expected performance in the March quarter (Q4). The firm is also trailing its smaller peer Amara Raja in Q4 as well as in FY20 at the operating level. The country’s largest lead acid player saw a 21 per cent dip in revenues over the year-ago quarter, largely from a sharp decline in demand from auto makers. Moreover, its inverter business has been hit in Q4, which is usually considered as a seasonally strong one, because of the Covid-19 outbreak. READ MORE 

 

Rupee closing

Rupee ends lower at 75.61/$ vs Monday's close of 75.54 against the US dollar

Nifty PSE index slips nearly a per cent; PFC, GAIL, BPCL decline up to 3%


Sector Watch :: Nifty Realty index trades 1% higher


BUZZING STOCK:: BHEL extends gains, jumps 7%


Stocks that hit 52-week high on BSE today

COMPANY PRICE(rs) 52 WK HIGH CHG(%)
ADANI GREEN 312.75 312.75 4.98
DHANUKA AGRITECH 602.00 619.00 3.93
DR REDDY'S LABS 4118.65 4140.90 3.83
GMM PFAUDLER 4457.85 4488.75 4.29
LUPIN 921.90 930.50 2.36
» More on 52 Week High

NEWS ALERT | BHEL commissions 270 MW thermal power plant in Telangana


BROKERAGE VIEW:: ICICI Securities on Relaxo Footwears

Relaxo Footwear over the years has maintained balance sheet prudence with controlled working capital cycle (NWC days: 65 days), healthy asset turns of 2.5x and generating RoCE of 20%+. With earnings in short-term expected to be negatively impacted (particularly H1FY21E), Relaxo through its strong balance sheet and brand patronage is expected to tide over the current situation. We bake in revenue, EBITDA CAGR of 10%, 15%, respectively, in FY20-22E. The stock saw a sharp run up last month (up 25%) and is currently trading at rich valuations (56.3x FY22E EPS). We continue to remain structurally positive on the stock and its long term growth prospects but post the recent stock price flare up, we downgrade a notch from BUY to HOLD with a target price of Rs 715 (earlier: Rs 775). We would prefer to await better entry points at lower levels from a long term holding perspective.

MARKET UPDATE :: Volatile trade today; Sensex up 50 pts now


European shares mixed in early deals

(Source: Reuters)


Sector Watch :: Nifty Energy index dips 0.5%


Cloud over Franklin Templeton's wind-up move amid legal challenges

On Monday, the Delhi High Court (HC) issued notice to Franklin MF, the Securities and Exchange Board of India (Sebi), following a writ petition filed by an investor challenging the wind-up notice and the subsequent e-voting notice issued by the fund house.
 
The petition challenged Franklin MF’s contentions that cited the Covid-19 pandemic for the wind-up move and that this was the only viable option to preserve value for the unitholders. READ MORE

ITC advances 4%, hits over 3-month high; stock surges 30% in one month

Shares of ITC hit an over three-month high of Rs 206 on the BSE, up 4 per cent on Tuesday in the intra-day trade. The company recently acquired Kolkata-based Sunrise Foods, a packaged spice maker with strong presence in East India. In the past one month, the stock of fast moving consumer goods (FMCG) company has rallied 30 per cent, as compared to 10 per cent rise in the S&P BSE Sensex. The stock was trading at its highest level since February 25, 2020. READ MORE

After 16% rally in three weeks, analysts turn cautious on small-caps

Of the 685 stocks from the smallcap index, more than half or 429 stocks beat the index by gaining over 16 per cent during the period. Total 241 stocks have rallied an over 25 per cent in the past three weeks. Of these five stocks – Khadim India, IFCI, Sintex Industries, LT Foods, and SREI Infrastructure Finance – have surged over 70 per cent, while 39 stocks soared in the range of 50 per cent to 70 per cent. READ MORE 


MARKET UPDATE :: Bombay Dyeing up over 2% ahead of Q4 nos


Tepid response to gold options launch on NSE, turnover a mere Rs 12 lakh

The NSE is offering “options” trading in gold for June and July. Trading in gold “options” is available also on the Bombay Stock Exchange (BSE) and the Multi Commodity Exchange of India (MCX). Apart from gold, the BSE offers “options” trading in silver. READ MORE

HDFC, ITC contribute the most to the Sensex's up move today


NEWS ALERT | PSBs have sanctioned loans worth Rs 1,109.03 cr for MSME hubs in 12 States under the Emergency Credit Line Guarantee Scheme: FM

MARKET UPDATE:: Adani Ports gains nearly 2%


BROKERAGE VIEW:: Edelweiss Securities on Divi's Lab

Divi’s Laboratories (DIVI) reported soft Q4FY20 numbers. Topline grew mere 4.5% in constant currency and EBITDA margin declined 90bps YoY to 32% on fixed operating expenses following partial commissioning of Hyderabad and Vizag brownfield projects. Gross margin benefited from backward integration of starting materials and softening of crude. However, while FY21 margins are expected to remain subdued as post-operative fixed costs for newly commissioned capacities will hit the P&L, approvals for developed markets are yet to come in. That said, we expect strong operating leverage in FY22 after full commercialisation of new capacities. While we like DIVI for such clear earnings visibility, we believe current valuations price-in the ~25% EPS CAGR over FY20-22E. Hence, we maintain ‘HOLD’ with TP of Rs 2,340.

BROKERAGE VIEW:: Emkay Global Financial Services on Varun Beverages

TP: Rs 850 | Rating: BUY | Upside: 34.4%
  • We assume coverage on VBL with a Buy rating and a TP of Rs 850. The positive stance is driven by visible market-share-gain opportunities in a healthy growing industry, best-in- class operational efficiencies and improving RoIC profile. CY20E performance will be hit by Covid-19 but long-term growth confidence drives higher-than-consensus estimates.
     
  • Industry prospects remain healthy with expectations of a ~9.5% CAGR in value terms over CY19-24E. We expect VBL to grow above the industry levels, with a 10.9%/13.3% CAG in terms of volume/value (refer to Exhibits 1-4). Under-penetration in acquired territories and scope for distribution expansion in Juices are key drivers for above industry growth.
     
  • VBL’s best-in-class operations and early signs of success provide confidence of market share gains in acquired regions. PepsiCo/other bottlers lost track in these regions due to loss-making operations and presence in other business segments.
     
  • Low near-term capex requirements (peak month plant utilization at <70% now) and strong growth should lead to continued improvement in RoIC.

Bumpy road ahead for L&T as order flows, project execution face challenges

Larsen & Toubro’s (L&T’s) March quarter (Q4) performance has encouraged analysts to maintain a positive medium-term outlook and ‘buy’ rating on the stock. This was driven by the 5 per cent increase in new orders, along with the commentary on the firm’s preparedness to manage disruption.  READ MORE

Top gainers on BSE at this hour

COMPANY PRICE(rs) CHG(%)
I T D C 226.60 10.00
TEJAS NETWORKS 51.85 9.97
INDIABULLS INTEG 43.10 9.95
SUZLON ENERGY 4.33 9.90
DISHMAN CARBOGEN 93.60 8.58
» More on Top Gainers

Why lowering promoter pledging is not enough to fire up Emami stock

A few months after entering into a binding agreement with Nuvoco Vistas Corporation (formerly Lafarge India) to sell its cement business, Emami Group is now divesting its solar power business (Emami Power is owned 100 per cent by promoters) to Brookfield Asset Management.
 
While deal-value details are not known and Emami Power is a separate entity from Emami Limited — the group’s listed fast-moving consumer goods company — it will have some bearing on the latter.  READ MORE

MARKET UPDATE:: 2.12% equity of REC changes hands


Beware the 'bull trap' in a bear market: Experts caution investors

The latest upmove in the markets has cheered the investment community. The benchmark Sensex has rallied 15 per cent in just 12 sessions. Many are calling the lows made on March 23 the new bottom.
 
Given the economic shock caused by the Covid-19 pandemic, it is stunning how markets have managed to hit a trough in just 69 days. READ MORE

Adani Green hits new high on winning world's largest solar bid worth $6 bn

This award, the largest of its type, ever, in the world, will entail a single investment of Rs 45,000 crore (USD 6 billion) and will create 400,000 direct and indirect jobs. It will also displace 900 million tonnes of carbon dioxide over its lifetime, it said. Based on the award agreement, the 8 GW of solar development projects will be implemented over the next five years. READ MORE 


Affle India to acquire Singapore-based Appnext; stock jumps 5%

Affle will initially acquire 66.67 per cent equity ownership in Appnext Singapore, with a clear path to acquire 100 per cent equity ownership upon attainment of mutually agreed growth targets, it added. READ MORE

Titan rises over 2% as March quarter results meet Street estimates

Shares of Titan Company rose as much as 2.7 per cent to Rs 1,047 on the BSE on Tuesday after the watch-to-jewellery maker posted largely in-line quarterly financial numbers although disruptions related to Covid-19 adversely impacted its top line and profit during this period. In the quarter ended March 31, Titan's net profit declined 1.5 per cent on a year-on-year (YoY) basis to Rs 343 crore as the pandemic adversely impacted operations during March. READ MORE

BROKERAGE VIEW:: Edelweiss Securities on Greaves Cotton

GRVs cost structure/business model is fairly competitive and could withstand current challenges in our view. Its directional focus of leveraging its current ecosystem with a fuel-neutral strategy (versus diesel based in the past) is quite an uphill task, but sustained management focus and industry transformation towards e-mobility could add a significant option value. We are trimming FY21/22E EPS by 12/7%, factoring in challenges. Maintain ‘BUY’ with TP of Rs 95 (Rs 90 earlier) as we roll forward to March 2022E EPS (12x PE).

MARKET CHECK:: Sensex sees a sudden spike


BROKERAGE VIEW:: Anand Rathi Shares on L&T Technology Services

RATING: BUY | TARGET PRICE: Rs 1,579 
  • L&T Technology Services Limited (LTTS) has reported a growth of 7.7% in its revenues at Rs.14,466 million in Q4-FY20 as against Rs.13,431 million in Q4-FY19. In US dollar terms the revenue growth was 2.1% YoY and decline of 2% QoQ at $195.4 million. The subdued performance during the quarter was mainly due to furloughs and some productivity loss due to twin impact of COVID-19 and significant Oil price declined leading to delays.
  • On profitability front, the company’s EBITDA margin stood at 18.5% at Rs.2,683 million in Q3-FY20 as against 18.5% at Rs.2,481 million in same quarter previous year. The consolidated profit after tax (PAT) margin (before XO items) for the company stood 14.3% at Rs.2,063 million as against 14.3% at Rs.1,924 million in same quarter previous year.
  • We have incorporated latest quarterly numbers for LTTS and have revised our estimates for the company in terms of both revenues and earnings. We continue to remain positive on the company for medium to long term, we maintain our rating to HOLD with a revised target priceRs.1,579 per share.

BROKERAGE VIEW:: ICICI Securities on Abbott India

Abbott India Limited’s (AIL) Q4FY20 performance was weak during the quarter. Revenue grew 6.1% YoY to Rs9.6bn, EBITDA margin declined 250bps YoY and 780bps QoQ to 14.4% and adjusted PAT declined 2.0% YoY to Rs1.1bn. This low growth was due to nationwide lockdown implemented in Mar’20 on account of COVID-19. We expect pressure in the near term which has several uncertain elements however, we remain positive on the company considering high visibility of strong growth with its exposure exclusively in domestic formulations, strong balance sheet with deep cash reserves, high return ratios and strong brand equity built over the years. Maintain ADD rating with a revised target price of Rs17,636/share (earlier: Rs19,971/share).

PVR, Inox Leisure decline up to 8% on posting losses for March quarter

PVR was down 5 per cent at Rs 1,106, extending its Monday’s 7 per cent loss as it reported a consolidated net loss of Rs 75 crore in the quarter under review, against a net profit of Rs 47 crore in the year-ago quarter. READ MORE

Marico surges over 2.5%, top gainer among FMCG pack


MARKET UPDATE:: ITC trades over 0.7% higher


Nifty Pharma index trades over 1% higher in a volatile market


Ahead of Q4 nos | Hero MotoCorp rises over 1%


L&T trades flat with negative bias post biz update

>> The company, in a disclosure on the impact of Covid-19 pandemic, said that For the quarter ended 31 March 2020, the impact due to the pandemic on the Company's revenues and net profits were approximately Rs 18 billion and Rs 4 billion respectively. This was due to stoppage of work in almost all the sites for the last part of March 2020 as well as the disruption to the last mile work, like physical inspection, customer clearance etc., that could not be completed due to lockdown restrictions.

SBI trades half a per cent lower

>> State Bank of India (SBI) gave huge relief to its customers on Monday by sharply reducing lending rates by 25-75 basis points (bps). This will have to be matched by other lenders at a time when margins are under pressure due to extended moratorium on loans and a ruling due on whether they can indeed charge interest on the moratorium.

Result Impact | PVR declines over 2%


Result Impact | Titan Company gains 0.8%

>> For the quarter ended March 31, Titan posted profit before tax (PBT) of Rs 509.25 crore, a rise of around 13 per cent compared to the same period in the previous financial year. Net profit of the Bengaluru-headquartered firm in the fourth quarter declined 1.5 per cent to Rs 343 crore, year-on-year (YoY).


Sectoral trends on NSE at open


Sensex Heatmap at Open :: 12 of 30 index constituents in red


FIRST TRADE | Nifty tests 10,200 at open


FIRST TRADE


NEWS ALERT :: Fuel prices hiked

Top gainers and losers on S&P BSE Sensex at Pre-open


Market at Pre-open


Market at Pre-open


Stocks to watch: Titan, SBI, L&T, PVR, Hero MotoCorp, RITES, Inox Leisure

Titan Co: For the quarter ended March 31, Titan posted profit before tax (PBT) of Rs 509.25 crore, a rise of around 13 per cent compared to the same period in the previous financial year. Net profit of the Bengaluru-headquartered firm in the fourth quarter declined 1.5 per cent to Rs 343 crore, year-on-year (YoY). 

L&T: The company, in a disclosure on the impact of Covid-19 pandemic, said that For the quarter ended 31 March 2020, the impact due to the pandemic on the Company's revenues and net profits were approximately Rs 18 billion and Rs 4 billion respectively. This was due to stoppage of work in almost all the sites for the last part of March 2020 as well as the disruption to the last mile work, like physical inspection, customer clearance etc., that could not be completed due to lockdown restrictions. READ MORE

NEWS ALERT :: Affle India to acquire Singapore based-Appnext

>> Co today announced the signing of definitive agreements to acquire full control of Appnext Pte. Ltd., Singapore and 100% IP of Appnext app discovery and recommendation platform with immediate effect.

>> Affle will initially acquire 66.67% equity ownership in Appnext Singapore, with a clear path to acquire 100% equity ownership upon attainment of mutually agreed growth targets.

(Via BSE filing)

BROKERAGE VIEW :: CLSA on Sun Pharma

Maintains 'Buy'; Target Rs 560

>> EBITDA contribution of Specialty biz to rise to 15%from nil by FY22

>> Specialty chem biz in the US is at inflexion point

>> Estimated to witness 32% CAGR over FY20-22

>> Operating leverage benefit will kick in

BROKERAGE VIEW :: CLSA on GSPL

Maintains 'Buy'; Revised target price: Rs 330 from Rs 360

>> Brokerage believes the volumes may normalise soon, by Q2FY21

>> Depressed LNG prices will delay volume impact of RIL's petcoke gasifiers

>> FY22 volume may see some impact due to slower growth elsewhere

>> Raise FY21 EPS estimate by 11% even as they cut FY22 EPS by 8%

Hero MotoCorp Q4 results preview: Analysts see over 30% decline in profit

Analysts at Axis Capital see Hero MotoCorp's Q4 revenue declining by 22 per cent YoY to Rs 6,160 crore. The brokerage is building in 5 per cent YoY increase in average selling prices (ASPs) on regulation driven price increases, as well as around Rs 200 crore discounts offered by the company to extinguish BS4 stock. Bottom-line is seen sliding 36 per cent YoY to Rs 470 crore. READ MORE

Gold price today: Rs 46,300 per 10 gm; silver at Rs 47,440 per kg

Gold price today jumped to Rs 46,300 from Rs 46,210 per 10 gram, while silver climbed to Rs 47,440 from Rs 47,410 per kilogram, according to Good Returns.
 
The gold jewellery prices vary across India — the second-largest consumer of the metal — due to excise duty, state taxes and making charges. READ MORE

Nifty view & stock calls by Anand Rathi: Buy Infosys, ICICI Prudential Life

BUY INFY | TARGET: Rs 760 | STOP LOSS: Rs 695
 
The stock is making a higher top and higher bottom pattern on the daily chart and reclaimed its long term moving average of 200-DMA which is placed at 708 levels. The stock has also provided breakout from its 3-month consolidation. The momentum oscillator MACD has also provided fresh buy crossover on a weekly scale which hints of positive momentum to continue in the short term. READ MORE

Bulk deals on NSE as on Monday

Bulk deals on BSE as on Monday

FII/FPI & DII trading activity on NSE, BSE and MSEI


Rupee check

Source: Bloomberg


Oil prices rise on optimism easing of lockdowns to spur fuel demand

>> Oil prices climbed on Tuesday, paring losses from the previous session, as markets broadly rose on growing confidence in a global recovery with pandemic lockdowns easing.

>> US West Texas Intermediate crude futures rose 1.3%, or 50 cents, to $38.69 a barrel at 7:04 am, after dropping by $1.36 on Monday.
 
>> Brent crude futures rose 1.4%, or 56 cents, to $41.36 a barrel. The benchmark contract fell $1.50 on Monday, snapping a seven-day streak of gains.

(Via Reuters)

SGX Nifty indicates positive start for indices

>> At 8:08 am, the index was at 10,222.80 level, up 57.75 points or 0.57 per cent

Asia trades mixed

Source: Reuters


Nasdaq ends at record, confirms bull market on economic recovery hopes

Source: Reuters


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