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PremiumSensex Today | Market Highlights: India's benchmark indices closed in the red, down from the day's high.
The NSE website was down during market open.
European stocks edged higher, following Wall Street’s record close on Friday, as Federal Reserve’s Jerome Powell reiterated the market may need to wait beyond March for the central bank to cut interest rates.
The Stoxx 600 Index up 0.2% as of 8:10 a.m. in London. Banks and travel & leisure were the best performing sectors while mining and energy lagged as investors gear up for another busy week of earnings.
Treasuries extended Friday’s selloff after Federal Reserve Chair Jerome Powell said policy makers will likely wait beyond March before cutting interest rates. Chinese stocks saw more wild swings after signals of official support.
Asian shares fell on Monday and the dollar climbed after a robust U.S. jobs report dashed any expectations of a near-term interest rate cut from the Federal Reserve, while stocks in China stocks remained on the back foot on weak sentiment.
But Tokyo stocks closed higher on Monday following records on Wall Street, as Japanese exporters benefited from a weaker yen. The benchmark Nikkei 225 index rose 0.54 percent, or 196.14 points, to 36,354.16, while the broader Topix index added 0.67 percent, or 17.03 points, to 2,556.71.
Oil prices were tentative following fresh strikes in Tehran-aligned factions in Iraq, Syria and Yemen over the last two days by the United States, with rising tension in the Middle East keeping risk appetite in check.
MSCI's broadest index of Asia-Pacific shares outside Japan slid 1% at the start of the week. The index is down 4.5% so far in the year. Japan's Nikkei rose 0.5%.
China's blue-chip index eased 0.12%, having touched a fresh five-year low last week. Hong Kong's Hang Seng Index fell 0.5% in early trading.
Data on Friday showed U.S. job growth accelerated in January and wages increased by the most in nearly two years, signs of persistent strength in the labour market that could push the Fed to start its easing cycle a bit later in the year than markets anticipated.
Markets are currently pricing in an 80% chance of the Fed standing pat on rates in March, compared with a 33% chance at the start of the year, the CME FedWatch tool showed. Traders are now pricing in just below 120 basis points of cuts this year.
Even before the labour market data, the Federal Open Market Committee (FOMC) meeting last week signalled little appetite for early or aggressive cuts, analysts at Barclays said in a note.
U.S. crude rose 0.21% to $72.43 a barrel and Brent was at $77.58, up 0.32% to start the week as escalating geopolitical tension and its repercussions on oil supply boosted prices.
Spot gold dropped 0.2% to $2,035.09 an ounce. U.S. gold futures fell 0.10% to $2,034.00 an ounce.
India's benchmark indices closed in the red from the day;s high.
At close, Sensex was down 354.21 points or 0.49% at 71,731.42 and Nifty was down 82.10 points or 0.38% at 21,771.70. Sensex had touched a high of 72,269.12, while Nifty peaked at 21,964.30 during the day.
Among sectoral indices, Consumer Durables, Financial Services, FMCG and Banks were the biggest losers. Broader markets also witnessed sell-off during the day's close, with many indices closing in the red.
European stocks edged higher, following Wall Street’s record close on Friday, as Federal Reserve’s Jerome Powell reiterated the market may need to wait beyond March for the central bank to cut interest rates.
The Stoxx 600 Index up 0.2% as of 8:10 a.m. in London.
Asian stocks were mostly lower on Monday, with Chinese shares again leading the declines even after the market regulator in Beijing pledged to crack down on abuses and protect small investors.
The main index in the smaller market in Shenzhen sank 4.4% but then rapidly recovered, bouncing between losses and gains and closing 1.1% lower. The Shanghai Composite index slipped 3.5% at one point and closed 1% lower, at 2,702.19.
The dollar rose to a two-month high against its major peers on Monday as traders clawed back bets for aggressive rate cuts by the Federal Reserve this year. USDINR Futures were trading at ₹83. 080.
The Fed repricing has followed Friday's blockbuster U.S. jobs report that far exceeded market expectations and sent U.S. bond yields soaring, boosting the country's currency.
Treasury yields rose further on Monday after Fed Chair Jerome Powell said the central bank could "give it some time" before cutting interest rates.
Standalone revenue growth of ~12% was led by volume growth in both Auto and industrial segment. Within 4W – replacement/OEM/exports volume grew +11%/+2%/+25%. Within 2W – replacement/OEM volumes grew +15%/ +30%. Home UPS growth was stagnant as it’s largely trading based business. Industrial overall volume grew 6-7% with most of the segment grew in same range while telecom segment grew >8-9%, inverter volumes were flat YoY. Have commenced exports to NA market.
Capex – Expect Rs2.5b in lead and Rs2.5-3 between lead recycling and new energy in FY24. Expect ~Rs6b in new energy in FY25E (this would include lead recycling capex of Rs2b).
Li-Ion project – Commercial operations to start early of FY26. Believe, EBITDA of 10-11% is possible (at a scale of 7-10Gwh), expect ROE of also to be 10-11% (only at optimum scale and current capex).
New energy business – Revenues split currently is ~80% battery packs supply to 2W and 3W…have commenced deliveries for telecom and industrial power backs. Current major customers for packs are 3W OEMs such as M&M and Piaggio. Have just started shipments to 2W customer as well. Telecom – supplying to BSNL and to commence to other telecom companies. In some cases, lithium batteries are replacing lead acid batteries and if the li-ion price continue to decline, the migration will further accelerate.
Higher other expense – have cost burden of ~Rs100m due to fire insurance and consultancy payment to increase efficiencies. The benefit of the same should start come in from 4QFY24.
Tubular battery plant reinstalment in process and expect the plant to be ready by season of 2025 (Feb/Mar 2025).
Lower core growth with weak margin performance
Revenue and margin below estimate as core business growth clocks early double digit growth
Revenue at 2% YoY on reported basis due to PPP contract in base quarter and some impact of Chennai floods (1% impact)
Core business growth at 12% on back of 9% vol growth (ex-covid and PPP contract) and 3% from better product mix
Margin lower than expectation at ~22% impacted by higher other expenses partly due to 0.9% impact of provision for debt of Aam Aadmi Mohalla Clinic and network investment
Muted topline growth and negative operating leverage translate into 24% YoY decline in PAT
Set to fire on all cylinders; U/G to BUY | TP Rs2,900, Upside 15%
Torrent Pharma is set to fire on all cylinders as we see traction build up across markets. 1) Domestic business is set to continue with double digit growth along with push from consumer portfolio. 2) US business would gradually ramp up as Dahej clearance would allow portfolio would move beyond the range of past few years. 3) Brazil is set to deliver persistent growth as increased MR count would drive revenues along with new launches and significant operating leverage unlocking over next 1-2 years. Q3 FY24 was a largely inline quarter with some degree of margin surprise – expect margin ramp up to continue as drag from US abates, Brazil provides margin up lift while India continues to chug along. We introduce FY26 forecast and believe margin can touch ~35% in FY26 from ~31% in FY24E which forms the basis of optimism. Upgrade to BUY based on raised target PE of 40x (earlier 35x) to factor in increased traction on revenue/margin as we roll over to FY26 EPS estimates. Our revised TP stands at Rs2,900.
Rating: SELL
Target Price : INR 515
Downside : 27%
CMP : INR 701 (as on 02 February 2024)
Improved prospects; margin to remain soft
Q3 revenue flat YoY on exports decline
RITES (RITE IN) revenue rose 1% YoY to INR 6.8bn in Q3FY24, in line with our estimates. Consultancy revenue grew 6% YoY to INR 3.3bn as project consultancy, up 21%, offset the fall in the inspection business, down 25%. Exports consultancy was down 53% while domestic consultancy was up 14%. Turnkey revenue rose 9% YoY to INR 2.6bn, leasing was up 3% to INR 365mn, and power generation up 39% to INR 31mn. Exports revenue slumped 38% YoY to INR 580mn. Management expects exports revenue to rise from H2FY25 on execution of 10 locomotive order from Mozambique (INR 2.9bn) received in Q3.
Export orders make a comeback after four year; more to follow
Exports fell 38% to INR 580mn in Q3FY24 on a draining backlog. It expects to win two more orders worth INR 10.5bn in the near term (Bangladesh order worth INR 8.5bn and the rest from Zimbabwe). Management expects steady revenue realization from Q2FY25 as execution picks up on existing and upcoming orders.
EBITDA margin compresses 380bp YoY to 24.7%
Cost of export sales fell 40% YoY in Q3 on lagging business; employee expenses were flat, and Other operating cost was down 8%. Cost of turnkey construction rose 21%, and transmission charges were up 8%. EBITDA fell 13% YoY to INR 1.7bn, in line with our estimates, as Indian Railways’ inspection business shifts to competitive bidding. EBITDA margin contracted 380bp YoY to 24.7%. With changing dynamics, management reduced our EBITDA margin to 20% with a FY19-23 average at 28%.
Valuation: reiterate Sell with a higher TP of INR 515
We raise our EPS by 10% for FY24E, 4% for FY25E and 8% for FY26E amid exports recovery. We increase our TP by 39% to INR 515 from INR 370 on 16x ([from 13x; three-year average one-year forward) December 2025E P/E, as we roll forward. We reiterate Sell on margin compression in consultancy and an outperformance of 44% vs the Nifty in the past three months. We expect an earnings CAGR of 15% during FY23-26E with a ROE and ROCE of 23% and 24%, respectively, during FY24-26E as the WC cycle may remain low despite the rise in turnkey construction along with a strong dividend yield of ~2.3% for FY24E.
Rating: BUY | CMP: Rs879 | TP: ₹1,010
Q3FY24 Result Update – Strong margin performance to continue
Quick Pointers:
Strength in margins to continue across segments
Impact on CV demand seen due to general elections in 4QFY24 & 1QFY25.
Tata Motors’ (TTMT) consol. revenue was largely in-line with our and consensus estimates, however, EBITDA margin at 13.9% beat PLe and BBGe easily. JLR sees 4Q performance to be strong on seasonality basis and has guided for EBIT of >8% in FY24. Its ASP decline paused in 3Q, after falling for 3 successive quarters, due to better mix. Conversely, benefits from volume ramp-up aided by good order book and rich mix of higher ASP models within that should support ASP and margins at higher levels. Lower CV discounts helped margins in 3Q; we see CV margins continuing to expand in 4Q. TTMT noted slowed demand for PV and CV in FY25 on high base and general election period among other factors.
We maintain our positive stance on TTMT given (1) JLR’s volume ramp-up resulting in strong revenue, profitability and FCF, 2) India CV benefitting from underlying economic strength, benign input costs and lower discounts and (3) focus on market share in PV segment (14.6% in Q3FY24 vs 8% in FY21) led by model launches and rising EV penetration. We increase our FY24/25/26E EBITDA estimates by 2%-6%, to factor in TTMT’s 3QFY24 margin and PAT performance. Retain ‘BUY’ with SoTP based TP of ₹1,010 (earlier ₹900).
3QFY24 largely in line revenues; margin beat across segment: Consol. revenue grew by c25% YoY and came-in slightly above PLe (+1.3%) & Bloomberg consensus estimate (BBGe) (+1.9%). Consol. EBITDA margin at c13.9% beat PLe (12.9%) and BBGe (12.6%). India CV revenues beat, while EBITDA margins (+c260bps YoY) reached 11.4% (PLe: 10.4%). PV (ex-JLR) results beat both on revenue and EBITDA margins. JLR revenue was in-line, while EBITDA margin expanded 130bps QoQ to 16.2% and beat PLe (15.5%)
Key takeaways: (1) JLR Anticipates improved wholesale and production volumes in 4Q and FY24 EBIT margin at +8%. Management noted JLR is on track to achieve 10% EBIT margin by FY26E. Order book is reaching more normal levels as expected due to increased production and JLR has increased its focus on building demand through brand activation. Chip and input cost moderated which helped margins. No major impact yet from Red Sea shipping issues. (2) CV segment is expected to see a single-digit decline in Q4 and impact in Q1FY25 due to general elections (elections typically have a passing impact for 3-6 months). Despite this strong GDP growth, govt. and infrastructure capex are likely to sustain demand - further helped by high fleet utilization and freight rates. Margins have benefited from higher realization and profitability focus through lower discounting and cost management by TTMT. (3) PV segment market share improved despite inventory corrections done in 3Q. TTMT noted that CNG (+25% YoY) and EV (+~2x YoY) have grown faster and expect this trend to continue; it sees industry growth of <5% in FY25. While commodity costs have been stable, it sees risk of increase in the same going forward. TTMT is leveraging its product range to drive penetration and expansion of the EV market with initiatives to expand charging infrastructure.
Rating: ACCUMULATE | CMP: Rs3,127 | TP: ₹3,312
Q3FY24 Result Update – Better placed to navigate engine challenges
Quick Pointers:
Aircraft on Ground (AoG) is in mid-70’s due to P&W engine issues.
Net worth turns positive as bottom-line was in black for 5th quarter in a row.
We cut our EBITDAR estimates by 9%/2% for FY25E/FY26E as we re-align our ASKM assumptions amid escalation in engine issues at P&W (~21% of the fleet is currently grounded). While InterGlobe Aviation (IndiGo) has taken mitigation measures like inducting aircrafts on damp lease it is likely to result in higher rental outgo in the near term. Nonetheless, artificial fleet scarcity arising from higher AoG can keep pricing at elevated levels and we expect yields of Rs4.9/Rs4.7 for FY25E/FY26E. Overall, we believe Indigo is better placed to navigate the P&W engine challenge as it has healthy fleet delivery pipeline with 1 induction expected each week in FY25E. In addition, the airline is partly utilizing Rs192bn of free cash to buy ATR’s and spare engines to compensate for shortfall in capacity. We expect revenue CAGR of 15% for next 3 years with EBITDAR margin of 23.5%/23.6%/21.8% in FY24E/FY25E/ FY26E (lower in last year due to higher fuel cost). Retain ‘ACCUMULATE’ with a TP of Rs3,312 (earlier Rs3,053) by assigning EV/EBITDA multiple of 7.5x as we roll forward to FY26E.
Revenue at ₹195bn (+30.3% YoY): Passenger revenue grew to Rs171.6bn (+30.4% YoY). Load factor stood at 85.8% (PLe 85.1%) with a yield of Rs5.48. Ancillary revenue increased 23.8% YoY to Rs17.6bn. ASKM/RPKM improved 3.3%/6.5% on sequential basis to 36.5bn/31.3bn respectively.
PAT at Rs30.0bn: EBITDAR increased 70.9% YoY to Rs54.5bn (PLe Rs45bn) with a margin of 28.0% (PLe 24.8%). However, adjusting for FX loss, EBITDAR margin stood at 28.3%. IndiGo reported a profit of Rs30.0bn (adjusted for FX loss, PAT was Rs30.5bn) as against a PAT of Rs14.2bn in 3QFY23.
Key takeaways: 1) The company introduced 7/6 new domestic/international destinations in 3QFY24. 2) Share of international ASK stood at 27%, and is expected to increase to 30% in FY25E. International passenger revenue forms ~20% of the total passenger revenue. 3) Capacity growth guidance for 4QFY24E is 12% YoY. However, on sequential basis ASKM is expected to decline by ~7% due to higher AoGs amid escalation in problem with P&W engines. 4) Other income was high, largely due to OEM related claims. In 2QFY24, OEM compensation received was towards maintenance cost incurred relating to AoGs, and hence, the benefit was adjusted in supplementary rentals. 5) Early double digit additions in new deliveries is expected in 4QFY24E. 6) Delivery of 1 plane is expected each week in FY25E. 7) The full cost impact of 13 damp leases taken in 3QFY24 will be seen in 4QFY24E. 8) No issues are faced in CFM engine supplies. 9) Currently, 136 aircrafts are on P&W engines. 10) IndiGo ended 3QFY24 with a free cash of Rs192bn and has partly utilized it in buying ATRs and spare engines. 11) Yields in Jan-24 are similar to same period last year and are expected to remain steady in February and March. Thus, for 4QFY24 yields should more or less remain steady when compared with 4QFY23.
Benchmark indices shed the gains of the day and slipped into the red from the days high. Sensex touched a high of 72,269.12, while Nifty peaked at 21,964.30 during the day.
At 3 pm, Sensex was down 454.98 points or 0.63% at 71,630.65 and Nifty was down 102.50 points or 0.47% at 21,751.30.
Rating: BUY | CMP: Rs650 | TP: Rs770
Q3FY24 Result Update - Upside risks to core PPoP in FY25 due to lower staff cost
Quick Pointers:
Core PPoP/PAT beat led by better NII, NIM, loan growth and lower provisions.
Headroom on LDR to cushion loan growth; staff cost may decline for FY25.
SBI reported a good quarter; while NII beat due to better NIM and loan growth. Adjusted for one-time impact (Rs71bn) of pension liability and benefit of ex-gratia, core PPoP/PAT was 4.8%/7.0% ahead of PLe. Credit growth at 5.2% QoQ was best-in-class. While bank guided for 14-15% loan growth, we expect SBI to grow at 13% CAGR over FY24-26E due to tight system liquidity. We have cut loan growth by 1% for all coverage banks except SBI, given upside risks as the following levers may support credit offtake viz. (1) low LDR at 74% (2) adequate LCR at 131% and (3) sufficient CET-1 at 11% (post RBI norms on re-classification of investments). Staff cost for FY24E may be Rs773bn (+35% YoY) due to wage revision impact of Rs180bn. There are downside risks to our staff cost estimate for FY25E at Rs800bn (+4% YoY). We remain positive on SBI and keep our multiple unchanged at 1.4x on Sep’25E ABV and maintain SOTP based TP at Rs770. Retain ‘BUY’.
NII/NIM beat due to increase in LDR; exceptional staff cost provided: NII was a 1% beat at Rs398bn due to better NIM at 3.07% (3.04%) and stronger loan growth at 15.1% YoY (PLe 12.7%). Deposit growth was 13% YoY (PLe 13.6%). Other income was ahead at Rs114.6bn (PLe Rs86.1bn) due to higher fees/treasury gains. Opex was broadly in-line at Rs309.4bn (PLe Rs310bn). Exceptional item of Rs71bn related to employee liability was provided. Core PPoP at Rs160.3bn was 4.8% higher to PLe while PPOP was Rs203.3bn (PLe Rs170.5bn). Asset quality was stable; GNPA/NNPA declined by 13bps/2bps QoQ to 2.4%/0.6%. Gross slippages were lower at Rs50.5bn (Rs52.5bn) and recoveries too were softer. Provisions were lower at Rs6.9bn (PLe Rs11bn) due to write-back in NPI and others. Restructured pool was 0.33%. Core PAT was Rs113bn (PLe Rs106bn); adjusted PAT was Rs144bn.
Sequential loan growth was broad based: Loan offtake at 5.2% QoQ was best-in-class led by domestic (5.1%) and overseas (5.1%). Domestic credit offtake was driven by corporate (4.7%), SME (7.5%), agri (6.5%) and retail (4.3%). Pipeline in corporate is Rs4.6trn. Due to RBI directions, pricing has been increased for unsecured/NBFC loans. Bank is not concerned with credit quality in Xpress loans as GNPA is merely 0.7%. SBI expects 14-15% loan growth for system although we are a bit circumspect given tight liquidity. While system credit growth could taper down in FY25E, SBI has multiple levers to maintain credit momentum since LDR is comfortable at 73.9% vs 71.3% last quarter and LCR is more than adequate at 131%.
Staff cost to normalize in FY25E: The quarter saw one-time impact of Rs71bn due to crystallization of liability to the tune of (1) Rs54bn related to pension at a uniform rate of 50% (vs existing 40%) and 2) Rs17bn due to ex-gratia. On wage revision, SBI made provision of Rs127bn in 9MFY24 and Rs54bn would be further provided in Q4’24, taking the total staff cost for FY24E to Rs773bn. While we see staff cost for FY25E at Rs804bn, it could reduce YoY considering normal rate of salary hike and additional Rs5bn per month due to wage revision. Bank expects employee cost of Rs660bn for FY25E.
Rating: HOLD | CMP: Rs1,058 | TP: ₹1,017
Q3FY24 Result Update – Healthy growth in UCP, higher losses in EMPS
Quick Pointers:
Robust volume growth of 27% YoY in RAC with YTD market share of 19%.
Losses in EMPS segment continue; increased significantly in the quarter.
We downward revise our FY24/25/26E adjusted earnings by 30.2%/5.5%/2.8% to factor losses in EMPS business from delay in collections and higher overhead expenses. Voltas reported rev. growth of 30.9% YoY led by healthy growth across segments; UCP/EMPS/EPS grew by 21.4%/51.4%/31.3% YoY. The company continues to be a market leader and has sustained leadership position in overall RAC business with its YTD market share of 19.0% in Dec-23 (v/s 19.5% in Aug-23). RAC segment reported robust vol. growth of 27% YoY and mgnt. expects it to continue in coming seasonal quarters driven by 1) strategic tie-ups with channel partners, 2) price calibration, 3) growing network of EBOs, 4) consumer-centric subvention schemes, and 5) focus on premium products sales. EMPS business reported healthy rev. growth on the back of strong order book & execution in domestic project business while higher losses in international business impacted profitability. Voltas Beko saw volume growth of 65% YoY, outperforming the industry. We estimate FY23-26E Revenue/EBITDA/PAT CAGR of 16.8%/26.1%/34.3% with RAC volume CAGR of 17.2% and EBITDA margin of 7.6% in FY26E. Maintain ‘HOLD’ at SOTP based revised TP of Rs1017 ( ₹1003 earlier)
Revenues grew by 30.1% YoY; Loss of ₹304mn: Revenue grew 30.1% YoY to Rs26.3bn (PLe: ₹23.6bn) led by healthy growth across segments, UCP/EMPS/EPS revenue grew by 21.4%/51.4%/31.3% YoY. Gross margin contracted by 250bps YoY to 21.5%. EBITDA declined by 62.8% YoY to Rs284mn (PLe: Rs1.4bn). EBITDA margin contracted by 270bps YoY to 1.1%. (PLe:6.0%). In terms of segmental EBIT margin, UCP segment margin came at 8.3% (+100bps YoY) on account of better product mix and focused margin enhancement approach, whereas EMPS reported loss of Rs1.2bn vs Rs461mn in Q3FY23. PBT declined by 33.1% YoY to Rs599mn (PLe: Rs1.9bn). Company reported a loss of ₹304mn (PLe: Profit of Rs1.1bn). VOLT’s share of loss from JV stood at Rs361mn.
Concall Takeaways:.1) Q3 is considered a lean quarter for Unitary Cooling Product, however, festivals & wedding season bolstered consumer appliance sales. Strategic partnerships with channel partners, calibrated pricing and an expanded product range led to impressive volume growth, outperforming industry, 2) Voltas achieve volume growth of 22%/27% YoY in UCP/RAC, mainly with EBO expansions, consumer-centric subvention schemes, increase in premium products placed with in-shop demonstrators and revival of demand. 3) Voltas maintained YTD market share of 19% as of Dec-23 (vs 19.2% in YTD Aug-23), 4) Commercial refrigeration reported strong growth for Chillers, VRF, Ducted and Packaged Air Conditioners both from retail and healthcare sectors. However, QCO implementation may impact sales, 5) Air cooler saw muted volume, while Voltas increased its exit market share to 8.9% (+170bps over Mar-23), 6) Order book for domestic projects stands at Rs. 5.3bn which is ~66% overall order book, 7) Dom. projects business reported 83% YoY rev. growth on the back of healthy order book at the beginning of the year and timely execution of projects, 8) Voltas Beko secured market share of 5.5%/3.3% in Washing Machine/refrigerators. The overall vol. growth of 65%/55% in Q3FY24/9MFY24, 9) Upcoming summers season, mgnt expects healthy demand for RAC, Commercial Refrigerators, Air coolers and Home Refrigerators with positive consumer sentiments.
Rating: HOLD | CMP: Rs847 | TP: ₹825
Q3FY24 Result Update – Poor sentiment hits demand, LT drivers intact
Quick Pointers:
SSG growth declined by 9% amidst poor sentiment in 3Q, expect steady recovery with normalization in another couple of quarters
WFL to add 40-42 stores in FY25 with target of total 580-630 stores by CY27
We cut FY24/25/26 EPS estimates by 13.2/16.3/15.1% following decline of 9% in SSG and 52.6% in PAT in Q3FY24. Sales were impacted by poor sentiments in some geographies, sustained pressure on discretionary spending & cyclone in Chennai. We believe rising availability of meal options with delivery platforms also resulted in some consumer shift away from QSR’s. operating De-leverage due to SSG decline has impacted margins and profitability. WFL itself does not have any inflationary pressures, however reversal in demand trends will take a couple of quarters.
Long term growth drivers remain intact with focus on 1) Burger, chicken and Coffee combos and Mcsaver meals 2) guidance of 580-630 stores by CY27 (40/45 in FY24) 2) menu innovations in café & value burgers and limited edition launches from time to time 3) increased traction in fried chicken and 4) flexibility of format with relevance across Metros, Tier 1, Mid-tier towns and Highways. We estimate 23.5% decline in EPS for FY24 but 36% CAGR over FY24-26E. we assign a DCF based target price of Rs825 (Rs839 earlier). We expect back ended returns linked to recovery in demand. Retain ‘Hold’.
Revenue declined by 1.8% and SSSG at -9%: Revenues declined by -1.8% YoY to Rs6bn (PLe: Rs6.5bn) SSSG stood at -9% Gross margins expanded by 12bps YoY to 70.3% (Ple: 70.6%) EBITDA declined by -10% YoY to Rs920mn (PLe: Rs1055mn); Margins contracted by -138bps YoY to 15.3% (PLe:16.1%) Adjusted PAT declined by -52.6% YoY to Rs172mn (PLe: Rs263mn).
Concall Takeaways: 1) WDL SSG came at -9% led by tepid Demand, adverse weather condition in south market & sustained pressure at discretionary spending 2) Diwali demand was good vs last year however non occasion days in Q3 saw muted demand 3) 30% stores in West & South market declined by 10-50% YoY , impacting the SSG 4) On-premise declined by 5% led by lower footfalls however off-premise saw 3% growth YoY 5) Impact of geopolitical factors will likely stabilize over next couple of quarters 6) RM prices remain stable, GM expected to be in the same range 5) Menu innovation with focus on café will further drive the growth 7) Digital sales grew 15% YoY, now contributing 67% to overall sales 8) MC spicy fried chicken continue to see traction in south market 9) All stores to be in EOTF format by 2027 except drive-through. 10) Westlife to add 40-45 stores in FY25, with no major closure & 580-630 store by 2027 11) store expansion will have more focus on south India, smaller towns and drive thrus 12) WFL is looking at adding 40-50 stores under EOTF in FY24, however drive- thru and food court based stores will not have EOTF. 13) FY24 capex expected to be of Rs2bn-Rs2.5bn.
Benchmark indices had a shaky start in morning trade, but they recovered during the day to trade in green. Sensex touched a high of 72,269.12, while Nifty peaked at 21,964.30 during the dat.
At 2 pm, Sensex was up 191.36 points or 0.27% at 72,276.98 and Nifty was up 87.25 points or 0.4% at 21,941.05.
Rating: ACCUMULATE
Target Price : INR 2841
Upside : 7%
CMP : INR 2687 (as on 02 February 2024)
In-line Q3; optimistic H2 outlook
Inline revenue with strong seasonality led growth in Top accounts.
eClerx (ECLX IN) reported 3.5% QoQ CC revenue growth and is in line with our estimates. Revenue at USD 90.5mn was up 3.3% QoQ. The key contributors to growth were financial markets (compliance and KYC regulation-led business) and customer operations businesses (seasonality from existing customers). The Top 10 clients continue to drive major growth, up 7.4% QoQ vs non-Top 10 clients growth of 1.0% QoQ. Revenue from managed services declined 1.8% YoY, forming 24% of revenue. Q3 was the third quarter of such negative YoY growth for the past 11 quarters. The deal pipeline remains healthy to drive demand, which may result in top-line growth from H2.
Margin slightly below our estimates; attrition at a historical low
EBIT margin missed our estimates by 90bp at 23.1%, down 110bp QoQ. This was on account of higher payment toward the hiring agency, citing the company’s investment toward sales personnel, reclassification of sales personnel, and uptick in travel cost. It added 743 employees QoQ of which 400-500 were transferred from the subsidiary; hence, net headcount addition is much lower. Attrition came in at an all-time low of 16.6%, up by 720bp QoQ. Utilization dropped 150bp QoQ to 73.9%.
Valuation: retain Accumulate with a higher TP of INR 2,841
We prefer ECLERX for its business expansion under the new leadership, strong margin profile and business offerings. We retain Accumulate, led by in-line Q3 and margin resilience backed by healthy orderbook pipeline. However, margin is set to stay range-bound, as the company will be investing toward sales & delivery, facility and gAI. We factor in Q3 performance and roll forward to December 2025E. We trim our EPS by ~2% each for FY25E and FY26E. We expect a USD sales CAGR of 11%, an EBIT CAGR of 13% and a PAT CAGR of 14% during FY23-26E. We raise our TP to INR 2,841 from INR 2,500 based on 16.5x (unchanged) December 2025E earnings at a five-year mean +1 SD.
UPL share price slumped over 9% to touch a 52-week low on Monday's session following the company's dismal Q3 results. UPL shares were among the top laggards on the Nifty 50. UPL share price today is trading at a three-year low. The UPL share price today opened at ₹507 apiece on BSE, and the UPL stock price touched an intraday low of ₹482 and an intraday high of ₹524.75. Due to UPL's disappointing Q3 results, the stock has been downgraded by many brokerages. (Click here to read the full story.)
Rating: ACCUMULATE
Target Price : INR 2,710
Upside : 6%
CMP : INR 2560 (as on 02 February 2024)
Not out of the woods yet…
Q3 dragged down by Communication; Banking turnaround intact
USD revenue growth for Mphasis (MPHL IN) came in at just 1.6%, way below our and street estimates. This was despite a tailwind of ~USD 15mn from the Silverline acquisition. Excluding the Silverline fillip, revenue contracted 2.8% QoQ USD, in a sharp deterioration from the growth journey since the past two quarters, dragged down by the Communication vertical.
The QoQ growth was led by Insurance/ Logistics and Transportation, up 6.9%/3.2%, QoQ USD. Banking growth was at 0.9%, in keeping with the turnaround journey after QoQ contraction over last four quarters. This indicates ebbing concerns over regional banks’ health. ‘Others’ was up the most at 11%, in line with the results announced yet. The biggest drag was Communication, with a 9.1% QoQ USD drop. Adjusted EBIT margin was at 16%, up 50bps QoQ, ahead of our estimates. Headcount addition of 221 QoQ is a key positive.
Banking – Green shoots visible
Banking Capital Markets reported a growth of 0.9% QoQ in INR terms, after four quarters of revenue contraction. Insurance also fared well with 7.6% QoQ growth. Segmental gross margin improved 55/145/47bps for BCM/Insurance/logistics. The effort was to spike segmental margin across-the-board. This indicates better-quality deals and higher end work being done in the BCM vertical. With the interest rate cycle turning positive, growth for the top client may revive and MPHL may be the prime beneficiary given its highest exposure to BFSI among tier-II players.
Valuations: Retain Accumulate; TP raised to INR 2,710
We are positive as pain in mortgages seems to be ebbing (albeit slowly), revenue growth has turned around and margin sustainability is there. We factor in Q3 print and raise FY25E-26E EPS 2.5-7% on green shoots in Banking and positive fallout from the interest rate cycle turning favorable, thus the better performance by Mortgage. We maintain Accumulate, with a raised TP of INR 2,710 (from INR 2,380), on 25.5x Dec-25E, in line with five-year average adjusted with +0.5 STD.
Recommendation: ADD
CMP: ₹2,560
Target Price: ₹2,910
Potential Return: +13.7%
Performance remains muted on account of near term challenges in demand environment
Mphasis (MPHL) reported mixed financial performance for the quarter. The sequential revenue growth for the quarter was below estimates; while EBIT margin was inline with expectation. Revenue grew 1.0% QoQ in cc terms, led by Direct segment (up 2.0% QoQ in cc terms). The INR reported growth was 1.9% QoQ. Direct now contributes 95.4% to revenue. EBIT margin decreased by 57bps QoQ at 14.9% and it was able to maintain the operating margin within guided ranged. Employee attrition continues to moderate for the company. We maintain our ADD rating on the stock with revised target price of ₹2,910/share at 26.5x on FY26E EPS. The stock trades at PER of 26.4x/23.3x on FY25E/FY26E EPS.
While benchmark indices had a shaky start in morning trade, they recovered during the day to trade in green.
Sensex was up 193.78 points or 0.27% at 72,279.41 and Nifty was up 86.15 points or 0.39% at 21,939.95.
Recommendation: BUY
CMP: ₹220
Target Price: ₹296
Potential Return: +34.5%
Investments to drive strong industry leading growth in medium term; reiterate BUY
Given the investments that company have been made for strong growth in domestic markets and new exports opportunity we expect company to deliver industry leading growth with margins normalizing sooner than expected. We continue to remain positive on the stock and reiterate our BUY rating with revised PT of Rs296 valuing 35x on FY26. We are anticipating revenue CAGR of 16%, and EBITDA and PAT CAGR of 30% and 35% respectively for FY23-26E. We believe ORIENTEL can outperform peers and could lead to market share gains. We believe if strategy executed well could result in strong growth in medium term.
Recommendation: BUY
CMP: ₹1,347
Target Price: ₹1,677
Potential Return: +24.5%
Market share and margins set to improve; upgrade to BUY
Expect WHIRL to continue with its current aggressive strategy and win back the lost market share and then further build on it. Management will continue to focus on improving profitability in the medium term and believes ELICA can deliver long-term sustainable growth as cooking category is in the nascent stage of growth.Despite near term demand headwinds, we continue to believe WHIRL’s strong parentage, and recent action of launching new products across the range, taking price correction in refrigerators and growth in ELICA will bode well for company going forward. We estimate FY23-26 Revenue/EBITDA/PAT CAGR of 10%/27%/33%. We upgrade the stock to BUY rating with PT of Rs1,677 valuing the stock at 40x rolling forward our multiple to FY26 EPS.
Recommendation: BUY
CMP: ₹650
Target Price: ₹830
Potential Return: +28%
SBI uses good times to make staff provisions, Maintain BUY
(1) Staff expenses to decline to ~ ₹660bn in FY25 from ~ ₹840bn in FY24, the latter including the ₹71bn exceptional item. (2) Management continues to flag that there is no real need for equity capital raise to deliver growth guidance. (3) Asset quality outcomes remain particularly benign and margin evolution is largely under control. (4) We maintain ‘Buy’ rating on SBI with a revised price target of ₹830.
Recommendation: BUY
CMP: ₹879
Target Price: ₹1,060
Potential Return: +21%
Healthy JLR performance to cushion weak S/A
TTMT’s 3QFY24 consol results were operationally in-line to our estimates while it exceeded street estimates with EBITDA beat of ~10.9% at Rs153.3b (+59% YoY/ +11.7% QoQ). While JLR demand commentaries continue to be positive for NA and stable for EU, there would be some disruptions led by red sea impact. We like TTMT given it’s improving India franchise, early leadership in EVs in India, and JLR’s improved profitability. Standalone business is in mid-upcycle both in PV and CV whereas favorable product cycle to help drive JLR outperformance. We cut FY25E consol EPS by ~10% as we cut CV volumes for the domestic business while raise FY26 consol EPS by ~9% to factor in for better margins at JLR and fast deleveraging. We estimate revenue/EBITDA/Adj.PAT CAGR of 10%/12%/27% in FY24-26E and maintain BUY with SoTP based TP of Rs1,060 (v/s Rs789 earlier). We raise JLR multiple to 3x (v/s 2x earlier) to factor in for healthy profitability.
Following a news report by the Hindu Businessline that Jio Financial Services was in talks with billionaire Mukesh Ambani-owned NBFC Jio Financial Services and private lender HDFC Bank to sell its wallet business, shares of JFS rallied up to 8.5% to day's high at ₹275.4 on BSE. Quoting senior fintech and banking sector executives in the know, the newspaper said HDFC Bank and Jio Financial are said to be among the forerunners to acquire Paytm's wallet business housed under Paytm Payments Bank.
While benchmark indices had a shaky start in morning trade, they recovered during the day to trade in green at noon.
Sensex was up 173.49 points or 0.24% at 72,259.12 and Nifty was up 68.70 points or 0.31% at 21,922.50.
Recommendation: BUY
CMP: ₹477
Target Price: ₹810
Potential Return: +70%
Near-term feedstock headwinds do not alter the structural story; Maintain BUY
We are positive on the company given its leadership in domestic 1G ethanol space, its dominant presence in the evolving CBG landscape, incremental opportunities in ETCA and a strong order book. We reduce our FY24 estimates by 5% given delay in domestic 1G execution and broadly maintain FY25/26E EPS estimates Maintain BUY with a target price of Rs810 based on 30x FY26E EPS.
Investec increased the Target Price to 240 and retained BUY stance on the company
Price: INR180 | Target: INR240 | Rec: Buy
Another good quarter with consolidated PAT growing 39% YoY. NBFC/HFC showed improvement in growth, asset quality and RoE. Loan growth strong at 5% QoQ despite slowdown in Personal & Consumer loans. LI APE growth slowed but VNB margin improved 10bps YoY to 15.6%. In AMC, it lost m/s but core PBT yield improved (4bps QoQ). Aditya Birla Capital (ABCL) has improved its businesses quality and is well positioned to deliver strong earnings growth over next three years (~14% RoE and 25%+ PAT CAGR over FY23-26E). NBFC (65% of capital) is the key for sustaining profitability (75% of cons PAT). Asset quality is key monitorable. Reiterate BUY with revised TP of ₹240 (roll over valuation to FY26E).
Positive trends in Lending Business: In Q3FY24, NBFC/HFC AUM grew 35%/28% YoY. NBFC's loan book is becoming granular with share of Retail/SME increasing to 70% vs 55% in FY20. NBFC/ HFC GS3 improved 5bps/45ps QoQ to 2.6%/2.2%. This led to NBFC/HFC RoE improving to 17%/15% (vs 10%/8% in FY20). It reduced dependence on Fintech partners with slow growth in Personal & Consumer loans (1% QoQ) and highlighted that PAYTM forms just 1% of NBFC loan book.
Growth moderates in LI & HI: LI Ind APE & HI GWP growth moderated to, 2%/31% YoY. LI VNB margin increased 10bps YoY to 15.6%. HI CoR increased to 121% (114% in 9MFY23).
AMC lost m/s: Q3 Total/Equity AAUM grew 0% QoQ / 4% QoQ. Active Equity M/S declined to 5.5% in Q3FY24 vs 6.2% in Q4FY23. Meanwhile, core PBT yield improved 4~23bps QoQ to 27bps aided by shift in AUM Mix.
One ABC & digital initiatives: ABCL has launched integrated platform of Branch/App/website to serve all financial needs through life cycle of its customers. It has also launched Udhyog App for SME ecosystem lending. It also plans to scale payments business and has partnered with NPCI.
PAT CAGR of ~25% over FY23-26E: We expect ABCL's consol. RoE to improve to ~15% by FY26E (from ~13% in FY23). This would lead to +25% PAT CAGR over FY23-FY26E. We increase TP to 240. BUY.
Rating: ACCUMULATE
Target Price : INR 935
Upside: 6%
CMP: INR 879 (as on 02 February 2024)
Strong performance across segments
Debt reduction and EV launch pipeline on track
Tata Motors’ (TTMT IN) Q3 consolidated EBITDA margin improved 170bps YoY/85bps QoQ to INR 13.9%, led by margin expansion across Jaguar Land Rover (JLR), and CV and PV business segments. JLR’s EBITDA margin surged 430bps YoY and 130bps QoQ to 16.2%, on strong product mix (Land Rover mix – 88% of JLR volume in Q3 versus 86% in Q2). JLR’s EBIT margin was 8.7%. Net realization dipped 3.8% YoY but rose 3.1% QoQ to GBP 73,000, on model and regional mix improvement. CV EBITDA margin surged 220bps YoY to 10.6% in Q3. PV EBITDA margin was down 30bps YoY to 6.6%.
Strong JLR order book at 150,000 units; VME on the rise
JLR order book, as at end-Q3, was 150,000 units (168,000 units as at end-Q2). And the management aims to pare this to 110,000 units (pre-pandemic level) in the coming months, with ramp-up in production. VME expenses have risen 2.5% in Q3FY24 from 1.5% of sales in Q2FY24 and may further increase in the coming quarters. Shipping issues in the Red Sea have resulted in ships needing to be rerouted, impacting transport timings for material and vehicles, but current impact is not significant. TTMT launched Punch.ev in Jan 2024. Curvv.ev to be launched in Q2FY25 (Curvv.ICE 3-4 months post EV launch) and Harrier.ev by Q3FY24-end. Consolidated net automotive debt reduced by INR 95bn to INR 292bn as at Q3FY24-end (versus INR 387bn as at end-Q2FY24, INR 599bn as at end-FY23), on track for deleveraging plan.
Valuations: Revise to Accumulate; TP raised to INR 935
JLR continued to post stellar EBIT margin at 8.2% in 9MFY24. India PV margin may rise in the ensuing quarters, given upcoming launches and EV cost normalization. Expect double-digit margin for India CV business in FY24E/25E. We expect TTMT to become net cash company in FY25E from current net debt of INR 292bn. Global demand scenario is a concern, but with 150k JLR orderbook, TTMT is well set for CY24 though VME may spike as incremental order intake is sub-par. We closely monitor JLR order book intake and India PV/CV demand on a high base with CV cycle nearing its peak. We revise TTMT to Accumulate from Buy and raise SoTP-TP to INR 935 from INR 779 on FY26E as we roll forward. Margin and deleveraging are on track.
Fueled by strong growth in subscriber numbers and an increased average revenue per user (ARPU) driven by premiumization efforts, Bharti Airtel is likely to announce a consolidated net profit of ₹38,068 crore, according to brokerages. This signifies a 6.3 percent YoY increase in the current quarter compared to ₹35,804.40 crore in the corresponding period last year, and a modest 2.7 percent sequential rise. According to a report by Prabhudas Lilladher, Airtel's consolidated revenue for Q3FY24 will experience a quarter-on-quarter increase of 2.3 percent, reaching ₹37,900 crore. Simultaneously, the adjusted Profit After Tax (PAT) for the current quarter is estimated at ₹15,467 crore, reflecting a 2.6 percent decrease from the Q3FY2023 figure of ₹15,881 crore.
After the announcement of Q3 results 2024 on Saturday, the State Bank of India (SBI) share price today opened flat facing resistance at ₹655 apiece level. According to stock market experts, SBI reported around a 35% decrease in YoY net profit in Q3FY24, but this is primarily due to a one-time exceptional item totaling ₹7,100 crore.
Stock market experts said that year-on-year profit growth for the first nine months underscores the bank's strong underlying performance. Stock market experts went on to add that the SBI share price is on the cusp of a fresh breakout at ₹655 level. Once the stock breaches this resistance on a closing basis, the Bank Nifty major is expected to become highly bullish. (Read the full story here.)
Sensex was up 81.68 points or 0.11% at 72,167.31 and Nifty was up 60.85 points or 0.28% at 21,914.65.
India's services activity jumped to a six month high in January driven by strong demand, productivity gains and rising inflow of new work, a private survey data showed on Monday. India's services activity measured by HSBC India Services PMI rose to 61.8 in January from 59 in December, the sharpest rate of expansion in six months. Services activity saw a sharp expansion in business activity in January. New business in the sector saw the quickest increase since July 2023 while new export sales rose at the quickest pace in three months, data showed.
India’s largest airline IndiGo clocked a profit after tax of ₹2,998.1 crore in the December quarter as air travel soared, against a net profit of ₹1,422.6 crore a year earlier, beating estimates from Prabhudas Lilladher. Total income rose 30.2% from a year earlier to ₹20,062.3 crore. IndiGo expects capacity growth of 12% in the March quarter as compared to the same period a year ago. For April-March 2024-25, the company’s management plans to induct at least an aircraft every week despite supply chain issues. The total expenditure rose 22% to ₹17,063.7 crore, with fuel expenses accounting for 40% of the total spend at ₹6,841.4 crore, up 18%. Yield, or revenue earned per paying passenger flown per kilometre (km), was at ₹5.48 per km, 2% higher than the year-ago period.
The board of directors of Salasar Techno Engineering Limited has allotted bonus shares to the eligible shareholders of the company. The company board announced the allotment of bonus shares while considering the unaudited Q3 results of 2024 of the company. Earlier, the telecom hardware company board had declared the issuance of bonus shares in a 4:1 ratio, setting a record date for bonus shares on 1st February 2024. In Q3FY24, Salasar Techno Engineering Ltd reported a total income of ₹304.15 crore, logging a QoQ rise of 10.40 percent against the total income of ₹275.56 crore in Q2FY24. On a YoY basis, the telecom company has managed to report 26.24 percent growth in total income. The company's net profit in Q3FY24 surged to ₹16.75 crore against the net profit of ₹10.77 crore in Q3FY23. In Q2FY24, the telecom hardware company reported a net profit of ₹9.20 crore.
Fueled by strong growth in subscriber numbers and an increased average revenue per user (ARPU) driven by premiumization efforts, Bharti Airtel is likely to announce a consolidated net profit of ₹38,068 crore, according to brokerages. This signifies a 6.3 percent YoY increase in the current quarter compared to ₹35,804.40 crore in the corresponding period last year, and a modest 2.7 percent sequential rise. According to a report by Prabhudas Lilladher, Airtel's consolidated revenue for Q3FY24 will experience a quarter-on-quarter increase of 2.3 percent, reaching ₹37,900 crore. Simultaneously, the adjusted Profit After Tax (PAT) for the current quarter is estimated at ₹15,467 crore, reflecting a 2.6 percent decrease from the Q3FY2023 figure of ₹15,881 crore.
Sensex was up 235.86 points or 0.33% at 72,321.49 and Nifty was up 87.50 points or 0.40% at 21,941.30 at 10 am.
Paytm stocks fell another 10 percent to ₹438.50, hitting the lower circuit on Monday, February 5. It has falled over 42 percent in the last three sessions.
Separately, it has categorically denyed any investigation by the Enforcement Directorate on One97 Communications, associates or its founder and CEO Vijay Shekhar Sharma for anti-money laundering activities, Paytm parent OCL rejected the recent misleading reports in media on Sunday, February 4. “Neither the company nor its founder and CEO are being investigated by the Enforcement Directorate regarding inter alia money laundering", the company said in an exchange filing. “We would like to set the record straight and deny any involvement in anti-money laundering activities... (sic)," the company said.
Traders' body CAIT on Sunday issued a cautionary advisory to traders to switch from Paytm to other payment options for business-related transactions following RBI curbs on Paytm wallet and bank operations.
The carmaker reported a surge of 137.5 per cent in consolidated net profit at ₹7,025.11 crore, compared to ₹2,958 crore in the year-ago period in the December quarter of FY24, beating Street estimates driven by strong sales in its British luxury car unit, Jaguar Land Rover (JLR). On the near-term outlook, Tata Motors remains positive on all three auto businesses. Tata Motor's total revenue from operations for Q3FY24 rose 25% to ₹110,577 crore, compared to ₹88,488.59 crore. On the operating front, the auto major's earnings before interest, taxes, depreciation, and amortization (EBITDA) in the December quarter rose 59 per cent to ₹15,333 crore, compared to ₹9,644 crore in the year-ago period.
The NSE website was down at market open.
Indian benchmark indices had a shaky start at market open.
Sensex was down 0.09% or 66.66 points at 72,018.97 and Nifty was up 0.01% or 2.45 points at 21,856.25 at market open.
Sensex was up 0.25% and Nifty was up 0.44% during pre-open trade. Tata Motors, Power Grid Corp., NTPC, Asian Paints, and Tata Steel were the top gainers on Sensex.
Categorically denying any investigation by the Enforcement Directorate on One97 Communications, associates or its founder and CEO Vijay Shekhar Sharma for anti-money laundering activities, Paytm parent OCL rejected the recent misleading reports in media on Sunday, February 4. “Neither the company nor its founder and CEO are being investigated by the Enforcement Directorate regarding inter alia money laundering", the company said in an exchange filing. “We would like to set the record straight and deny any involvement in anti-money laundering activities... (sic)," the company said.
Traders' body CAIT on Sunday issued a cautionary advisory to traders to switch from Paytm to other payment options for business-related transactions following RBI curbs on Paytm wallet and bank operations.
BANK NIFTY opened higher, scaled a high of 46,892 and witnessed sharp profit booking to decline by 900 points from the high to close near the low point of the day.
The crossover of 46,500 levels gave a intraday breakout but failed to sustain and it would be key to cross for the positive trend
RSI is piercing upwards crossing its average line and other key technical indicators are in positive momentum.
Bank Nifty highest call OI has moved to 46,500 CE while on the downside moved higher to 45,500 for the put OI for the weekly expiry.
NIFTY-50 has closed at all time high on the weekly chart and we continue to remain positive till it does not breach 21,400 levels on the downside.
A doji candle on the daily charts indicates resistance at 22000-, 22,100 levels while on the downside the support would be at 21,630-21,650 levels.
RSI is witnessing and trending above the average line and we expect the momentum to continue over the next few days.
Highest call OI is at 22,000 strike while on the downside the highest put OI has moved higher to 21,400 for the weekly expiry.
India's largest bank reported its Q3 standalone net profit at ₹9,164 crore on February 3, a decline of 35% in the December quarter, the company said in a stock exchange filing. SBI's net profit for the October-December quarter was weighed down by higher operating expenses, it stated. Corporate advances crossed ₹10 trillion, while SME advances surpassed ₹4 trillion – showing expansion in both sectors. Gross Non-Performing Assets (NPA) also showed an improvement, standing at 2.42%, down 72 bps compared to the previous year. Net NPA also improved at 0.64%, down by 13 bps YoY.
SBI, Airtel, TaMo, Indigo, Paytm, Zee, are among the stocks that will be in focus on Thursday, January 25.
India's GIFT Nifty was trading at 21,916 points as of 8:25 am, suggesting the NSE Nifty 50 will open near its Friday close of 21,853.80.
The Indian rupee is expected to decline at open on Monday after a robust U.S. jobs report and comments by Federal Reserve Chair Jerome Powell prompted a plunge in the odds of an interest rate cut in March.
Non-deliverable forwards indicate the rupee will open at around 83 to the U.S. dollar, compared with its close of 82.9175 in the previous session.
Investors are now pricing in only a 15% probability that the Fed will cut rates at its next meeting in March. The dollar index climbed to its highest since mid-December and the two-year U.S. yield rose to a one-month peak.
Chinese stocks fell, adding to last week’s rout, as investors assessed the latest pledge by policymakers to stabilize the slumping market.
The Hang Seng China Enterprises Index fell as much as 1.5% before paring some of its loss. The CSI 300 Index also slipped following its worst week since 2022. Both indexes have trailed most major equity benchmarks around the world this year.
Equities on the mainland capped their worst week in years on Friday, with the benchmark CSI 300 Index sliding 4.6%. The Shanghai Composite Index lost 6.2% in its biggest weekly drop since 2018.
