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PremiumShare Market Today: Sensex and Nifty ended flat with a negative bias as banking and financial stocks shed in today's session. Investors chose to book profits in these sectors at higher levels amid concerns about a trade conflict between the United States and China.
Indices had a record-setting spree on Tuesday as the frontline indices settled at their record closing highs for the fourth consecutive session. It was the fifth consecutive session of gains for Sensex whereas for Nifty it was the sixth consecutive session of gains.
Asian stock markets sank on Wednesday after a measure of Chinese service industry activity fell to its lowest level this year. Japan's Nikkei share average fell for a second day as investors booked profits after a recent rally.
Indian shares ended flat on Wednesday as investors took note of weakness in other Asian markets and booked profits at higher levels. The pessimism also was because of concerns about a trade conflict between the United States and China.
The Nifty index gained marginally and ended at 19,398, while the S&P BSE Sensex fell 30 pts to close at 65,446. Eleven of the 15 broad-based Nifty sectoral indices ended in the green in today's session.
High-weightage financials and bank indices lost dragged by HDFC and HDFC Bank, down more than 2.5% each. Auto, FMCG, and Media surged more than a per cent each. PSU Bank also ended in the green despite a drag in other banking and financial indices.
Apart from HDFC twins, Eicher Motors shed 2.8%, Tata Consumers and UPL more than a per cent each. Bajaj Auto and Divi's Lab jumped 5% each. Hero Motors, Maruti Suzuki and HDFC Life were other major gainers.
Japan's Nikkei share average fell for a second day on Wednesday as investors booked profits after a recent rally, with Fast Retailing dragging the index after the Uniqlo brand owner posted a drop in monthly sales. The Nikkei index lost 0.25%. The broader Topix ended almost flat.
Chinese stocks ended lower after a private-sector survey showed the country's services activity expanded at the slowest pace in five months in June, while escalating Sino-U.S. tensions also dented investor sentiment.
China's blue-chip CSI 300 Index dropped 0.8%, while the Shanghai Composite Index declined 0.7% at the close. Hong Kong's Hang Seng Index retreated 1.6% and the Hang Seng China Enterprises Index fell 1.9%.
Europe's main stock markets retreated at the start of trading Wednesday following losses in Asia on poorly-received Chinese data.
British shares fell as mining stocks retreated on lower metal prices, while other China-exposed stocks fell as subdued data sparked concerns of slowing demand in the world's second-largest economy.
Sameet Chavan, Head Research, Technical and Derivatives, Angel One Ltd: Nifty is now nearing it’s important cluster of 19450-19500. After seeing a vertical rally in last 6 trading sessions, some sort of breather or minor pause cannot be ruled out. Hence, traders can choose to stay light ahead of expiry after reaching mentioned levels. By no means, we expect a complete reversal in the market, rather any small decline should be considered healthy from a broader perspective. We may then see Nifty gearing up for a next move towards 19800-20000 and for BANKNIFTY 46000 and beyond levels.
Shares of Poonawalla Fincorp rallied over 4% on Wednesday after the company reported robust business update for the first quarter ending June 2023. The stock hit its fresh 52-week high of ₹375.80 apiece on the BSE during the session.
The NBFC recorded its highest ever total disbursements of ₹7,050 crore during Q1FY24, registering a growth of 143% from ₹2,901 crore in the same period last year. Sequentially, disbursements rose 11% from ₹6,371 crore in Q4FY23. (Read More)
BDR Pharmaceuticals announces the launch of Nilotinib, a rare subtype of the most common childhood cancer, acute lymphoblastic leukemia. PH+ Leukemia, encompassing Acute Lymphoblastic Leukemia (ALL) and Chronic Myeloid Leukemia (CML) are infrequent and complex types of cancer that affect both children and adults. While this Philadelphia chromosome is rare in pediatric ALL, it is much more common in adult ALL.
The company said that with the introduction of Nilotinib, the company strives to provide a game-changing solution for individuals battling Ph+ leukemia.
Indian aviation regulator Directorate General of Civil Aviation has signed a memorandum of understanding with the European aviation regulator European Union Aviation Safety Agency (EASA) for cooperation in unmanned aircraft systems and innovative air mobility. This MoU will focus on collaboration on unmanned aircraft and innovative air mobility between the two civil aviation authorities, the regulator said.
India's service sector growth fell to a three-month low in June but remained buoyant amid strong demand, a private survey said on Wednesday.
The S&P Global India services Purchasing Managers' Index (PMI) declined to 58.5 in June from 61.2 in May, and 62 in April. A Reuters poll had forecast PMI at 60.2 for June.
Yes Securities recommends BUY for Aptus Value Housing Finance India Ltd with a target price of Rs. 350/share (42.3% return).
Strong growth/quality at reasonable valuation
Aptus Value Home offers a favourable long-term risk-reward at current valuation (2.7x PABV and 16x PE on FY25E), wherein structural business model positives seem underemphasized. While concerns over stock supply in the longer run are tenable, the apprehensions around management transition and business scalability appear stretched. We view the appointment of Mr. Balaji as MD (erstwhile ED & CFO) as a non-disruptive development with growth/quality execution fairly verticalized and institutionalized at Aptus, and the likelihood of Mr. Anandan guiding strategy even after current term (ending in Dec’24) by being a Non-executive Chairman. Aptus has demonstrated regional diversification/scalability with comparable asset quality across disparate Southern markets. While existing markets can comfortably support 25-30% growth in coming years, the contiguous and calibrated entry/expansion in new states would aid long run prospects.
Structurally, portfolio spread and opex metric should remain in a narrow band underpinned by benefits from niche positioning, scale, tech investments and credit rating. Aptus’ strong customer and property underwriting, and focused collection mechanism gets reflected in low credit cost and GNPLs, and negligible actual loan write-offs. We estimate 27-28% AUM CAGR and 23-24% earnings CAGR over FY23- 26 with RoE crossing 18% in FY26 (without assuming further dividend payouts). At potentially 4-5x leverage in the very long run, Aptus can deliver 22-25% RoE. Reiterate BUY on favourable risk-reward with a 12m PT of Rs350.
Investors lowered their expectations of gains in Asian equities this year as optimism fades about the prospects of looser monetary policy and China’s economic outlook.
That’s the view of most of the 17 strategists and fund managers surveyed by Bloomberg News. The MSCI Asia Pacific Index is seen rising to 174 by year end, according to the average of 13 responses to a poll late last month. The forecast implies gains of 5% from Tuesday’s close, and compares with the 178.5 level predicted in a similar Bloomberg survey three months ago.
Should the prediction prove prescient, the Asian benchmark would end the year below its March 2022 level, when the Federal Reserve delivered its first rate hike in three years, implying that investors aren’t yet ready to factor in any significant monetary policy shift.
Vivo India today released the second edition of the India Impact Report. The smartphone company conducted a study in association with Techarc to ascertain the ‘Economic Value of a Smartphone’.
The study sheds light on how smartphone consumers are increasingly relying on their smartphones to pay their utility bills and shopping/booking/hiring of products and services. One such interesting finds of the survey is that a smartphone consumer in India benefits by ₹6 for every Re 1 spent. (Read More)
Hero MotoCorp, the world's largest two-wheeler manufacturer, witnessed a significant rally in its share price due to the launch of the X440, a premium motorcycle co-developed with iconic American brand Harley-Davidson.
The stock experienced a sharp rise, reaching a fresh 52-week high of ₹3,159.95 apiece on the BSE on Wednesday. It had already rallied 4.52% in the previous session.
The introduction of the X440 is a significant move for Hero MotoCorp and Harley-Davidson as it marks their entry into the 440cc segment in India. This launch is expected to boost Hero MotoCorp's market share within this particular segment. (Read More)
Financial firm SBI Holdings said on Wednesday it would help Taiwan's Powerchip Semiconductor Manufacturing Corp establish a factory in Japan as the country looks to revive it chip industry.
SBI will establish a company to aid with planning and fundraising, including lobbying for government subsidies, and will help the chipmaker find a location to produce semiconductors for automakers and industrial machinery manufacturers and for a research lab to develop more advanced chips, the Japanese firm's CEO, Yoshitaka Kitao, told reporters.
"This is the best possible time to enter chip manufacturing," Kitao said at a joint press conference with the Taiwanese company's chairman, Frank Huang. Powerchip is currently looking at three or four potential sites and manufacturing could begin two years after construction starts, Kitao added. (Reuters)
Traction in residential property transactions has sustained an upward trend in the demand for home decor products, offering a positive sign for related industries. The demand upswing could stimulate higher volume growth, and with some raw material costs now in decline, companies might see a recovery in operating margins.
According to analysts at Prabhudas Lilladher, in Q1FY24 plastic pipe sector is expected to report Ebitda margin expansion of 300 basis points (bps) year-on-year (y-o-y) to 15.2% with stability in raw material prices. Sales volume is expected to grow 15.1% y-o-y. Ebitda is short for earnings before interest, tax, depreciation and amortization. (Read More)
LTI Mindtree, a technology major, experienced a rise in its share price, reaching a new 52-week high during Wednesday's trading session. This increase was attributed to the company's inclusion in the Nifty 50 index, replacing housing finance giant Housing Development Finance Corporation Ltd (HDFC).
LTI Mindtree shares opened at ₹5,373.05 apiece on the BSE and witnessed an intraday high of ₹5,425, with a low of ₹5,225. The change in the Nifty 50 composition was decided by the Index Maintenance Sub-Committee (Equity) of NSE Indices, and the inclusion of LTI Mindtree and the exclusion of HDFC will take effect from July 13. (Read More)
Motorola plans to ramp up investments and bolster its marketing strategies in India over the next one to three years, as it aims to become one of the top three global players, said Sergio Buniac, president of Motorola Mobility and senior vice president of Lenovo Mobile Business Group, the parent of Motorola.
In his first visit to India since being appointed global head in 2018, Buniac revealed ambitious plans to make the company one of the top three smartphone players in the country. In an exclusive interview with Mint, Buniac said that Motorola aims to double its volumes in India this year and quadruple by 2026, and also aggressively expand its offline presence. (Read More)
The initial public offering (IPO) of Senco Gold Ltd, a jewelry brand, has received a strong response from investors. On the second day of the bidding process, the IPO has been fully subscribed, with the issue receiving bids for 1.12 crore shares compared to the 94.18 lakh shares on offer. This translates to a subscription rate of 1.25 times.
The robust subscription is primarily attributed to the enthusiastic participation of retail and non-institutional investors (NII). The strong response indicates investor confidence in Senco Gold's IPO and reflects the attractiveness of the company's business prospects. (Read More)
IndusInd Bank witnessed a positive response in its share price, rallying over 3% to reach a 52-week high of ₹1,413.55 apiece on the BSE. This surge was driven by the bank's strong business update for the first quarter ended June 2023.
During Q1FY24, IndusInd Bank reported a robust growth in net advances, which increased by 21% to ₹3,01,041 crore compared to ₹2,47,960 crore in the same period last year. Sequentially, advances grew by 4% from ₹2,89,924 crore in the previous quarter (March 2023).
Furthermore, the bank's deposits as of June 2023 stood at ₹3,47,356 crore, reflecting a YoY growth of 15% from ₹3,03,078 crore. On a quarterly basis, deposits grew by 3% from ₹3,36,438 crore in the previous quarter (Q4FY23). (Read More)
Threads, the recently introduced microblogging app by Meta, is the new platform that will enter the market as a direct rival to Twitter. According to a listing on Apple's App Store, Threads, a text-based conversation app, will enable users to follow the same accounts they currently follow on Instagram and maintain their existing usernames.
However, people have started to raise concerns regarding the permissions and data access required by Twitter's new rival app Threads.
Jack Dorsey, co-founder and former CEO of Twitter, expressed reservations regarding the permissions and data access demanded by Meta's recently launched application. (Read More)
HAVELLS INDIA LIMITED - Company Update: Havells remains focused on ensuring its presence across the value chain through a) increased presence in e-commerce, b) deeper penetration into India through the Rural Vistaar programme and Utsav stores, c) increased participation in B2B projects, and d) expanded footprint in international markets. Despite expectation of softness in near-term demand owing to unseasonal rains and weak summer intensity, we like Havells’ long-term growth strategy through continuous portfolio and distribution expansion and brand-building initiatives. Among peers, HAVL enjoys the highest margins in many product categories and generates healthy FCF despite high capex (unlike most peers, the company has opted for in-house production). We believe the margin has hit a trough and will continue to improve from here on, given (1) softening commodity inflation; (2) an increase in the premium mix (fans: 30% vs 17% five years back) and lowering losses in Lloyd. We recommend BUY with a TP of ₹1,453.
The initial public offering (IPO) of PKH Ventures, a company specializing in civil construction work for projects developed by other parties, has been withdrawn. The decision to withdraw the IPO was made due to a lack of interest and a subdued response from institutional investors during the three-day bidding period.
On the third day of bidding, only 65% of the issue was subscribed, indicating a lackluster response from institutional investors. However, the retail investors' portion was subscribed at 99% and the non-institutional investors' portion was subscribed 1.67 times. In contrast, the Qualified Institutional Buyers (QIB) portion received only an 11% subscription, while the employee portion did not receive any subscription. (Read More)
Vivek Kumar of JM Financial Institutional Securities says on Samvardhana Motherson International: Yachiyo 4W business: Yet another strategic acquisition! BUY - INR 120
Samvardhana Motherson International (SAMIL) entered into an agreement with Honda Motor to acquire 81% stake in Yachiyo’s 4W (Y4W) business, a Honda Motor subsidiary involved in manufacturing and supply of Sunroof Systems and Fuel Tanks. Y4W has 9% market share globally in Sunroof Systems and is a long-term strategic supplier to Honda Motor. We see this deal as a strategic positive for SAMIL’s long-term growth, as we believe it helps the company: a) penetrate deeper with Honda (cross-selling opportunities) and b) help foray into global Sunroof and Fuel Tank market. The acquisition comes at an attractive valuation c.1.7x trailing EV/EBITDA and 0.2x EV/sales. Transaction closure is expected by 1QFY25 and will be funded through internal accrual. We continue to maintain our positive stance on SAMIL. Easing supply chain, sustained recovery in global auto sales, higher operating leverage and improving profitability is expected to drive ROCE going ahead. We reiterate BUY with Mar’24 TP of INR 120.
Pepper Money India, a subsidiary of global consumer finance company, Pepper Group, announced the appointment of Hardeep Singh as the Chief Financial Officer (CFO). Hardeep will spearhead the financial strategy and management to accelerate the growth of the firm's India business.
The press statement said that Hardeep brings over two decades of rich experience across companies like Clix Capital, GE Capital, Pine Labs, American Express, KPMG and 3SC.
The Indian rupee opened marginally lower against the US dollar on Wednesday following weakness in Asian currencies on weak China data and ahead of the US Federal Reserve June meeting minutes, due later in the day. The local unit fell 3 paise to open at 82.05 a dollar as compared to the previous close of 82.02.
According to data provided by Quess, a business services provider, there has been a notable increase in headcount growth across various sectors in India this year, despite global turbulence. From January to May 2023, there was a 12% rise in headcount compared to the corresponding period in the previous year. This growth can be attributed primarily to improvements in India's financial and investment cycle.
Among the sectors, the professional services industry experienced the highest growth, with a doubling of headcount compared to last year. (Read More)
Yes Bank, a private sector lender in India, has reported a 7.5% year-on-year growth in its advances for the quarter ended June 2023. The bank's advances stood at ₹2,00,308 crore during this period, compared to ₹186,367 crore in the same quarter last year. On a sequential basis, the growth in advances was 0.1% from ₹200,201 crore in the previous quarter (March 2023).
In terms of deposits, Yes Bank witnessed a 13.5% year-on-year increase in Q1FY24, with deposits amounting to ₹219,369 crore as compared to ₹193,241 crore in the corresponding period last year. Sequentially, the bank's deposits grew by 0.9% from ₹217,502 crore in the previous quarter (Q4FY23). (Read More)
Dr V K Vijayakumar, Chief Investment Strategist at Geojit Financial Services: The 15 % surge in Nifty from the low levels of March has given a bullish flavour to this rally; but it is difficult to describe this as a bull market since valuations do not permit a sustained rally and the evolving economic fundamentals do not warrant continuation of the rally much beyond the current levels.
A sustained bull run needs low valuations and steadily improving growth and earnings prospects. Valuations are not favourable now and growth and earnings prospects, though good, are not very bright. For instance, the June auto sales numbers came below expectations and indicate that sluggish demand remains a problem, particularly for price sensitive mass consumption products. The economic recovery continues to be ‘K’ shaped as indicated by the resilient demand for premium products.
There is valuation comfort in financials, particularly the leading private sector banks. Leading PSU banks are attractively valued compared to their private sector peers. FY24 Q1 results of the banking majors will be good.
HDFC Bank, the largest private lender in India, has reported significant growth in its advances and deposits for the first quarter of the fiscal year 2023-24.
As of June 30, 2023, HDFC Bank's advances stood at approximately ₹16,15,500 crore, reflecting a growth of 15.8% compared to the same period in the previous year when it was ₹13,95,100 crore. The bank's advances also increased by around 0.9% from ₹16,00,600 crore as of March 31, 2023.
In terms of deposits, HDFC Bank disclosed that its total deposits amounted to approximately ₹19,13,000 crore in the first quarter of FY24. This represents a notable growth of about 19.2% from ₹16,04,800 crore during the corresponding period last year. Additionally, the bank's deposits increased by 1.6% from ₹18,83,400 crore as of March 31, 2023. (Read More)
According to a report by China Daily, former Vice Commerce Minister Wei Jianguo has stated that China's recent export control measures on chip-making materials are just the beginning, and the country possesses additional sanction measures and tools at its disposal. In an interview with the state-backed newspaper, Wei described the export control measures as a well-planned and significant move.
Wei further commented that if restrictions targeting China's high-technology sector persist, China will respond with escalating countermeasures. The statement implies that China is prepared to take further actions in response to any perceived unfair treatment or constraints on its technology sector. (Read More)
The initial public offering (IPO) of drone maker ideaForge Technology has garnered strong demand from investors across various categories. The company has announced its plans to finalize the allotment of IPO shares on July 5.
During the subscription period from June 26 to June 30, the ideaForge Technology IPO received overwhelming response and was oversubscribed by 106.06 times. The IPO had initially offered 46.48 lakh shares, but it received bids for 49.30 crore shares, amounting to a total value of ₹567 crore. (Read More)
Dabur India, a fast-moving consumer goods (FMCG) company, has revealed in its fiscal 2023 annual report that it added five new brands that achieved sales exceeding ₹100 crore during the financial year 2022-23. This information was disclosed in the annual report released to the exchanges on Tuesday.
“Today, we have a portfolio of 23 billion rupee brands, brands with sales greater than ₹ 100 crore. The year 2022-23 saw five brands joining this list. In all, we now have 17 brands that are above ₹100 crore but lesser than ₹500 crore in size; two brands that are over ₹500 crore but less than ₹1,000 crore in size, and another four brands that have a turnover of more than ₹1,000 crore," the company said.
Brands to enter the billion rupee portfolio during the last fiscal include—Honitus, Real drinks, Odomos, Dabur herb’l and Badshah spices. (Read More)
Top 10 stocks in focus:
1. State Bank of India (SBI) acquires stake in SBICAP Ventures
2. LTI Mindtree replaces HDFC on NSE indices
3. Samvardhana Motherson acquires majority stake in Yachiyo Industry
4. NCLT adjourns case involving Willis Lease Finance Corporation's petition against SpiceJet
5. Dabur India adds new brands to its portfolio
6. Mahindra & Mahindra reports increase in domestic vehicle sales
7. Suzlon Energy to consider proposal to raise capital
8. Indian Oil to consider rights issue of equity shares
9. GIC to acquire majority stake in Genus Power's smart metering solutions venture
10. SAIL reports growth in crude steel production (Read More)
Genus Power Infrastructure has announced that GIC, Singapore's sovereign wealth fund, will acquire a 74% stake in its new smart metering solutions venture for $2 billion. According to the press release, Gem View Investment, an affiliate of GIC, will hold a majority stake of 74% and will have controlling rights in the platform. Genus Power & Infrastructure will retain the remaining 26% stake.
This strategic investment by GIC highlights its interest in the smart metering solutions sector. By acquiring a significant stake in Genus Power & Infrastructure's venture, GIC aims to capitalize on the growth potential of the smart metering industry.
Mumbai-based law firm Resolüt Partners advised GIC Singapore on the collaboration with Genus Power Infrastructures Limited. The firm specializes in complex cross-border PE/M&A transactions.
Mahindra & Mahindra (M&M) has reported a 21% increase in domestic passenger vehicle sales for June 2023 compared to the same month last year. The company sold 32,588 units of passenger vehicles in June 2023, whereas in June 2022, the figure stood at 26,880 units.
According to a statement from M&M, the domestic sales of utility vehicles reached 32,585 units in June 2023, reflecting a growth of 22% compared to the same period in the previous year. In June 2022, the company had sold 26,620 units of utility vehicles. (Read More)
Suzlon Energy has announced that its board of directors will convene on July 7 to discuss a proposal for raising capital. The company has stated that the capital raising will be conducted through one or more permissible methods or a combination thereof.
In a BSE filing, Suzlon Energy said, “This is to inform that a meeting of the Board of Directors of the Company will be held on Friday, 7th July 2023 to consider and approve: 1. Capital raising by way of one or more or combination of permissible methods; 2. Seeking approval of the shareholders, if required." (Read More)
On July 4, 2023, the Executive Committee of the Central Board of the State Bank of India (SBI) approved the acquisition of the entire stake held by SBI Capital Markets (SBICAP) in SBICAP Ventures (SVL). SBI has proposed to acquire 100% of the stake in SVL, which amounts to 6,03,80,000 equity shares.
The transaction is expected to be completed at an estimated cost of ₹708.07 crore. Once the acquisition is finalized, SBI will hold the entire stake in SVL, with SBICAP divesting its shares.
This acquisition by SBI signifies its strategic move to consolidate its position in the venture capital space by acquiring the stake held by SBICAP in SVL. (Read More)
On July 4, Samvardhana Motherson International (SAMIL), an auto parts maker, announced its intention to acquire a majority stake of 81% in Yachiyo Industry's four-wheeler (4W) business, which is a subsidiary of Honda Motor. The transaction is valued at 22.9 billion Japanese yen ($158.54 million) and was disclosed in a regulatory filing by SAMIL to the stock exchanges.
Currently, Honda holds a 50.4% stake in Yachiyo, with the remaining shares owned by the public. As part of the deal, Honda will first acquire the entire public stake in Yachiyo through a tender offer. Afterward, Honda will retain Yachiyo's two-wheeler (2W) business, which is housed under Goshi Giken. SAMIL will then acquire an 81% stake in Yachiyo's 4W business, while Honda will retain a 19% stake. (Read More)
Foreign institutional investors (FIIs) have been actively buying Indian stocks for five consecutive trading sessions, with a significant investment of over ₹2,134 crore. This buying spree took place on a day when the US market was closed. This indicates that FIIs have shown confidence in the Indian equities market.
On the other hand, domestic institutional investors (DIIs) have widened their selling activities. On July 4th, DIIs sold equities worth ₹7,811.62 crore, resulting in an overall outflow of ₹785.48 crore compared to the previous day. Despite purchasing equities worth ₹7,026.14 crore, the significant selling by DIIs has led to a net outflow.
These trends suggest that while foreign investors have been bullish and optimistic about the Indian market, domestic investors have been more inclined towards selling their holdings. The market is likely anticipating the upcoming Q1 results for the fiscal year 2024, and investors are adjusting their positions accordingly. (Read More)
Asian and European equities faltered Tuesday in muted trade, with Wall Street shut for the US Independence Day holiday.
Oil rebounded from losses the previous day, when key producers Saudi Arabia and Russia unexpectedly unveiled more output cuts in a bid to stabilise the market.
The dollar rose against the euro but fell against the yen, as investors awaited Wednesday's publication of minutes from the Federal Reserve's most recent monetary policy meeting.
Friday's key US nonfarm payrolls (NFP) report will provide clues on the health of the world's biggest economy.
This week sees also minutes from the Federal Reserve's last rate-setting meeting.
Investors weighed signs of a slowing US economy against hopes that the Fed's interest-rate hiking cycle could be nearing its end. (AFP)
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