PremiumIndian indices on Friday edged lower after the US Fed chairman Jerome Powell made hawkish comments, indicating toughening of monetary policy. He signalled that the US central bank will have to move more aggressively to counter US inflation, and explicitly said a half-point interest rate increase is "on the table" for next month's policy meeting. The comments soured the investor sentiments as most shares in Europe and US declined. In Asia, shares in Japan, Australia, South Korea, and Hong Kong declined, while that in Shanghai advanced marginally on Friday.
Indian indices slipped on Friday, dragged down by losses in all the sectors after US Fed chief's hawkish comments soured global sentiments.
The Sensex plunged 714.53 points, or 1.23%, to close at 57,197.15, while Nifty50 lost 220.60 points to end at 17,172. Sectorally, all the sectors ended lower with banks, financials, and metals taking the biggest hit.
On the 30-stock index, the most gains were made by M&M, Bharti Airtel, and Maruti, among others, while SBI, HUL, and IndusInd Bank were among the biggest losers.
On Nifty50, Adani Ports, M&M, HCL Tech, and ITC made the most gains, while Hindalco, SBI, and HUL were among the biggest laggards.
Mastek shares are one of the multibagger stocks in 2021. In last one month, this IT stock has remained under the sell-off heat as the stock has shed near 3 per cent in this period. In fact, the stock has been under consolidation phase after ushering in new year 2022 as Mastek share price in YTD time has plunged from around ₹3040 to ₹2935 levels, logging near 3.5 per cent loss in this period. However, Mastek share price today has surged near 4 per cent and Anand Rathi believes that the consolidation phase is soon going to become history for the multibagger IT stock. It believes that Mastek share price may surge from current ₹2935 levels to ₹3400 levels in long-term.
Zinc prices on Friday fell by 0.11 per cent to ₹370.15 per kg in futures trade as speculators reduced their exposure taking negative cues from spot market.
On the Multi Commodity Exchange, zinc contracts for May delivery traded lower by 40 paise or 0.11 per cent to ₹370.15 per kg in 1,105 lots.
Analysts said offloading of positions by participants, owing to slackened demand from consuming industries in physical market, mainly weighed on zinc prices.
Shares of Rallis India Ltd have fallen more than 9% so far on the National Stock Exchange on Friday. This is on a day when the benchmark Nifty50 index was down about 1%.
Tata Communications reported a net profit of ₹365 crore, up 22% year-on-year for the quarter ended March 2022, aided by higher other income which majorly included tax refunds and interests.
Stock market today: After remaining laggard in last year rally at Dalal Street, Nifty Auto index has given fresh breakout at 11,000 levels on closing basis on Thursday. This breakout has raised hope for market observers about some sharp upside move in leading auto majors. However, stock market experts maintained that one should keep a watch on the Nifty Auto index and wait for some more time as there can be sharp upside moves in auto stocks if the Nifty Auto index ends above 11,100 levels today.
Asian shares mostly fell Friday, tracking losses on Wall Street after Federal Reserve Chair Jerome Powell indicated increases in interest rates must be faster to fight inflation.
Major indexes cascaded downward in Asia. Japan's consumer price index data showed an increase for the seventh consecutive month, although the results were within market expectations.
Japan’s benchmark Nikkei 225 dipped 1.6% in afternoon trading to 27,106.56. Australia’s S&P/ASX 200 dropped 1.6% to 7,473.30. South Korea’s Kospi shed 0.7% to 2,707.96. Hong Kong’s Hang Seng slipped 0.2% to 20,638.33, while the Shanghai Composite recouped earlier losses to edge up 0.4% to 3,091.79.
Rainbow Children’s Medicare Limited IPO to open on 27th April 2022 with price band of ₹516 to ₹542 per share.
Rainbow Children's Medicare Limited is a south based multi-speciality pediatric, obstetrics and gynaecology hospital chain. Rainbow Children's Medicare is one of its new born baby focused hospital chain in India. Company has 14 hospitals and three clinics in six cities, with a total bed capacity of 1,500 beds. The company offers a wide range of services such as newborn and pediatric intensive care, pediatric multi-speciality services, pediatric quaternary care, obstetrics and gynaecology, which includes normal and complex obstetric care, and multidisciplinary fetal care, perinatal genetic and fertility care.
Looking at the financial growth, companies profit after tax up by 228% at 126.4 crores year ended 31st December 2021 as compared to 31st December 2020 and revenue for the same period up by 15.2%.
We have a positive outlook for Rainbow Children’s Medicare Limited IPO.
Cryptocurrency prices today declined with Bitcoin slipping below the $41,000 level.
Investors’ reaction to the March quarter earnings of L&T Technology and Services Ltd (LTTS) was muted, with the stock falling around 1.5% on Friday on the NSE. The Q4FY22 earnings performance of this tier-II IT company was a mixed bag.
Retail investors have more than doubled their stake in Paytm shares by raising their shareholding from 3.49 per cent to 7.72 per cent in the fintech company during January to March 2022 quarter. Canada Pension Plan Investment Board (CPPIB) too raised its holding in Paytm from 1.57 per cent to 1.71 per cent in recently ended March 2022 quarter. However, FIIs trimmed their stake in the company from 9.36 per cent to 4.42 per cent in Q4FY22. To pare this FIIs 'net selling' trend, some top mutual funds like SBI Mutual Fund, LIC Mutual Fund, etc. have bought stake in Paytm in April 2022.
Data continues to support the robust demand momentum driven by both agri and OTR segments (FY22-YTD industry exports are up ~47% YoY on USD basis). Regionally, growth in Feb’22 was led by RoW (up 25% YoY) followed by the US and EU at 18% YoY each. Recent inflation (~12% since Q3FY22) in international rubber prices (chart 7) coupled with capacity constraints are likely to sustain pressure on H1FY23E margins. Decadal-high US new housing construction starts and higher infra/mining investments across key markets of US/EU lend realism to our revenue growth assumption of ~15% CAGR over FY22-FY24E (~12% growth in volumes). Maintain BUY
Indian stock markets fell sharply today as global sentiment soured after the US Fed chief hinted at an increasingly aggressive rate hike amid concerns about high inflation. The Sensex and Nifty fell more than 1% though the broader markets werflat. Overnight, Fed Chair Jerome Powell said that a half-point rate hike will be "on the table" when the central bank meets in May, and it would be appropriate to "be moving a little more quickly."
We recommend a BUY rating on the stock and assign a 20x P/E multiple to its FY24E earnings of ₹67.4/share to arrive at a TP of ₹1,345/share, indicating an upside of 22% from the CMP.
Rating: BUY | CMP: ₹831 | TP: ₹1,096
Our EPS estimates remain unchanged. We now value Cyient on 18x (earlier: 22x) given – 1) downside risk to revenue growth because of semiconductor supply challenges in DLM (17% of revenue), 2) Macro uncertainties likely to moderate ER&D spends, and 3) High exposure (~57% of revenue) to aerospace, rail transportation and utilities sectors where growth still remains muted. We arrive at a TP of INR 1096 (earlier INR 1258) on FY24 EPS (roll-over) of INR 60.9. Cyient is currently trading at attractive valuations of 15.4x/13.7x on FY23/24 earnings of INR 54/61 respectively at significant discount to ER&D sector trading at ~40x FY24 EPS. We anticipate 14.3% revenue CAGR & 14% EPS CAGR for FY22-24E. Maintain Buy!
Which penny stocks are the best for the long term?
Oil headed for its third weekly loss in four as lockdowns in virus-hit China dragged on and the Federal Reserve signaled that monetary policy will be tightened aggressively to contain decades-high inflation.
West Texas Intermediate fell toward $102 a barrel, and is more than 4% lower this week. The world’s biggest crude importer has imposed a series of lockdowns including in Shanghai to stamp out a fresh Covid-19 wave. The curbs have cut demand for fuels and spurred economists to reduce growth forecasts.
Investors are bracing for the U.S. central bank to hike interest rates at a rapid clip, with Chair Jerome Powell signaling two or more half percentage-point increases in comments on Thursday. The pivot has boosted the dollar, making commodities more expensive for holders of other currencies.
Oil remains more than 35% higher this year despite the recent weakness as the fallout from Moscow’s invasion of Ukraine continues to rattle markets and roil crude flows. There are calls for the European Union to ban Russian oil, matching steps taken by the U.S. and U.K. Support for prices has also come from interruptions to supplies from Libya amid a wave of protests.
Tata Elxsi share price extended its post-result rally for second successive session today. The multibagger stock today opened around ₹28 lower from its Thursday close on NSE. But, the Tata group stock soon attracted buyers interest and went on to regain ₹8,000 mark. Tata Elxsi share price is currently quoting ₹8,065 (at 10:50 AM on NSE) apiece levels, logging around ₹490 per share rise in last three days. One of the multibagger stocks in 2021, Tata Elxsi stock price has been appreciating on better-than-expected Q4 results announced on Wednesday.
Adani Ports and Special Economic Zone Ltd (“APSEZ") through its subsidiary, The Adani Harbour Services Ltd (“TAHSL"), has entered into an agreement for acquisition of 100% stake in Ocean Sparkle Ltd (‘OSL’), India’s leading third party marine services provider. Key activities carried by the company include towage, pilotage, and dredging.
China's yuan extended losses against the dollar on Friday and looked set for its worst week in more than 2-1/2 years, as market participants wondered if the sizeable fall this week was a policy response to counter economic slowdown. A hawkish U.S. Federal Reserve, the vanishing Chinese yield advantage and rising concerns over domestic economic growth have dragged the yuan, or renminbi, to seven-month lows. The yuan's losses accelerated after a breach of the psychologically critical 6.4 per dollar, with the onshore yuan traded at 6.4692 by midday on Friday, a loss of 1.5% against the greenback for the week, which is the biggest weekly drop since August 2019.
Shares of HCL Technologies on Friday jumped over 3 per cent after the company reported a three-fold jump in consolidated net profit for the fourth quarter ended March 2022.
The stock gained 3.21 per cent to ₹1,135 on the BSE.
At the NSE, it jumped 3.25 per cent to ₹1,134.95.
The company on Thursday reported a three-fold jump in consolidated net profit for March quarter at ₹3,593 crore as it struck an optimistic note about the "buoyant" market environment and "strong momentum across verticals and service lines" to guide for 12-14 per cent revenue growth for FY23.
Campus Activewear IPO (Initial Public Offering) is going to hit primary markets next week. As per the information available on the BSE, the public issue worth ₹1,400.14 crore will open for subscription on 26th April 2022 and it will remain open for subscription till 28th April 2022.
The rupee depreciated 14 paise to 76.31 against the US dollar in opening trade on Friday, as a lacklustre trend in the domestic equity markets and a firm American dollar weighed on investor sentiment.
However, a pullback in international crude prices restricted the losses, forex traders said.
At the interbank foreign exchange, the rupee opened sharply lower against the US dollar, and was moving in a tight range with a negative bias. It was trading at 76.31 in early deals, registering a fall of 14 paise over the last close.
In the previous session, the rupee rose 13 paise to close at 76.17 against the US dollar.
The dollar index, which gauges the greenback's strength against a basket of six currencies, rose 0.04 per cent to 100.65.
Dolly Khanna portfolio: Chennai-based investor has done a lot of rejig in her portfolio in recently ended March 2022 quarter. The marquee investor entered 6 new stocks in Q4FY22 and booked partial profit in 6 portfolio stocks. However, the market magnet has dropped surprise for Dalal Street observers after bookin profit in multibagger fashion stock Monte Carlo Fashions. In shareholding pattern of the company for Q4 FY2021-22, Dolly Khanna's name is missing from the list of individual shareholders.
SBI Research: Special Report
❑ India’s merchandise exports touched a record $420 billion in FY 2021-22. It took the country a decade to incrementally add another $100 billion ($300 billion mark was touched in FY12) as against reaching $200 billion from $100 billion in only 5 years (FY06 to FY11)
❑ Emergence of New Trade Corridor through FTAs/ECTA/CEPA, PLI scheme among others have contributed to this growth
❑ India’s exports of goods and services (% of GDP) which was only 3.7% in 1970 and 6.1% in 1980, reached a peak in 2013 (25.4%) but decelerated thereafter till 2020 (18.7%) mirroring the global trend. The share of service exports in total exports has increased gradually, and significantly from 27% in FY2001 to 41% in FY21, though moderating to 37% in FY22
❑ Contrary to popular perception, our estimates show that 55% of the increase in exports in FY22 is attributed to quantity effect and the rest 45% is the price effect, indicating that the growth in exports in FY22 could be sustained if we continue to follow right policies. As expected, our results show that only 31% of the increase in exports of petroleum crude and products in FY22 can be attributed to higher quantity and rest 69% is because of higher price
Rakesh Jhunjhunwala portfolio is closely followed by retail investors as single change in ace investor's portfolio works as major Rakesh Jhunjhunwala tips for them. Out of near 3 dozen stocks hold by the "Warren Buffett of India," there are some particular convictions that works as major reason for Big Bull to remain invested in these stocks. Titan Company shares are one such stock, which has been doubling shareholders' money since 2009. So, those retail investors and market observers who want to know the reason for this Tata stock being one of the favourite stocks of Rakesh Jhunjhunwala, this can be an interesting fact for them.
Uncertainties over the Life Insurance Corp. of India’s (LIC’s) initial public offering (IPO) are likely to delay the Centre’s plans to list three other state-run companies, Export Credit Guarantee Corp. of India (ECGC), WAPCOS and National Seeds Corp. Ltd, according to a senior government official.
A clutch of lenders accounting for most of the loans to debt-laden Future Group on Thursday rejected a proposal to sell its retail, wholesale and logistics assets to Reliance Retail Ventures Ltd after the Reliance Industries Ltd unit cut the deal value in a surprise move, two people aware of the development said.
8 stocks to buy or sell today — 22nd April
We cut LTTS’s rating to Accumulate from Buy as we cut DCF based target
price to Rs. 4549 (earlier: Rs.5428) given expensive valuations on backdrop
of possible moderation in ER&D spends (more discretionary in nature) given
high inflationary environment, supply chain issues and global macro
uncertainties and little scope for further margin expansion over FY23-24 due
to higher manpower costs, return of travel costs and investments for future
growth. Our EPS estimates cut by 3.3%/4.2% in FY23/24 led by cut in revenue
estimates. We assume ~18% margins in FY23 & FY24.
FY23 USD revenue growth guidance of 13.5-15.5% YoY USD appears to be
conservative given pickup in large deal wins especially in EACV segment in
FY22 and all-time large deal pipeline. However, given possibility of
moderation in ER&D spends due to macro uncertainties, guidance may not
be upgraded by same level as it was done in FY22 (upgraded from 13-15% to
19-20%). Management targets to maintain 18%+ EBIT margin factoring in
headwinds from intermittent wage hikes, travel costs, high admin expenses
partially offset by tailwinds of growth leverage, better quality of revenues,
pyramid optimization and operational efficiencies.
We arrive at DCF based TP of Rs. 4549 with implied target multiple of 36x P/E
on FY24 EPS (earlier 41x). LTTS is currently trading at 38x/33x on FY23/24
earnings of INR 111/126 respectively with Revenue/EPS CAGR of 16%/17%
over FY22-24E.
We downgrade HCLT to ‘Accumulate’ (earlier Buy) as we cut DCF based target price to Rs. 1169 (earlier Rs. 1295) led by 1) decline in margin profile, 2) volatility in P&P revenue dragging down overall revenue growth, 3) increase in risk free rate and 4) moderation in terminal growth rate. We cut EPS estimates by 4%/5% for FY23/24, led by cut in EBIT margin estimates by ~50-70 bps.
Q4 reported weak revenue (0.5% QoQ USD) due to decline in P&P business (-24.4% QoQ USD) and moderation in ER&D growth (3.5% QoQ USD). IT services revenue grew 4.6% QoQ USD. We believe growth in new deal TCV (14% YoY) and ACV (21% YoY) for FY23 is strong, but revenue guidance of 12-14% YoY for FY23 is lower due to volatility and declining trajectory of P&P (12% of total revenue). We anticipate recovery in P&P business to be slow because – 1) it is run as a software start-up and 2) 25% of P&P portfolio is declining in high double digit. Growth in ER&D business (16% of revenue) is also lower than ER&D peers for FY22.
We assign DCF based TP of ₹1169 with implied target multiple of 19x (earlier 21x) on FY24 EPS. HCLT is currently trading at 20x/18x on FY23/24E EPS of INR 54.5/62.5 respectively with Revenue/EPS CAGR of 12.4%/12% over FY22-24E.
Gold prices slipped on Friday, pressured by strength in U.S. Treasury yields, and were headed for their first weekly fall in three.
Oil prices fell on Friday, heading for a drop of nearly 4% for the week, burdened by the prospect of rate hikes, weaker global growth and COVID-19 lockdowns in China hurting demand, even as the European Union weighed a ban on Russian oil.
Brent crude futures slid 81 cents, or 0.8%, to $107.52 a barrel at 0130 GMT, while U.S. West Texas Intermediate (WTI) crude futures declined 72 cents, or 0.7%, to $103.07 a barrel.
Both benchmark contracts were headed for weekly declines of around 3.7%.
This has been the least volatile week of trade since Russia launched its invasion of Ukraine on Feb. 24, sparking sanctions that cut Russian oil supply and led consuming nations to release a record volume of oil from emergency stockpiles. Moscow calls its actions in Ukraine a "special operation".
Australian shares fell on Friday, as investors took cues from a tepid Wall Street overnight finish after the U.S. Federal Reserve reiterated aggressive rate-hike views, while miners also dragged the benchmark index lower on weak iron ore prices.
The S&P/ASX 200 index was down 1.5% at 7,479.20 points, as of 0038 GMT. The benchmark, which closed 0.3% higher on Thursday, was on track for its worst week in two months, if losses hold.
Miners slumped 3.9% and were set for their biggest weekly drop since last August after iron ore prices fell amid COVID-19 concerns and steel production controls in top steel producer China.
Global miners BHP and Rio Tinto, which flagged continuing production weakness earlier this week, fell 5% and 4.1%, respectively, to be the top losers in the mining sub-index.
Tokyo stocks opened lower on Friday, extending losses on Wall Street following hawkish comments from the Federal Reserve about its monetary tightening plans.
The benchmark Nikkei 225 index was down 1.49 percent, or 410.48 points, at 27,142.58 in early trade, while the broader Topix index was down 1.16 percent, or 22.36 points, at 1,905.64.
Stocks, U.S. equity futures and sovereign bonds fell Friday as the prospect of one of the Federal Reserve’s most aggressive monetary tightening cycles in recent history sowed more market discontent.
An Asian share gauge sank to the lowest level in over a month, sapped by Japan and Hong Kong. S&P 500, Nasdaq 100 and European contracts were also in the red. Energy and technology equities led Wall Street lower Thursday.
China’s economy-sapping Covid lockdowns and concerns over regulations weighed on the nation’s equity bourses. Beijing’s vow of market stability has failed to mollify investors: the latest step was a statement from the securities watchdog urging institutional investors to buy more domestic shares.
The dollar advanced, the yen weakened and oil dipped below $103 a barrel. Energy costs are still elevated supply challenges posted by the conflict, but slowing U.S. and Chinese growth could curb demand too.
US stocks tumbled while the dollar rallied Thursday following hawkish comments from the head of the Federal Reserve that exacerbated worries over higher interest rates, offsetting a lift from a resurgent airline industry.
With bourses in Paris and Frankfurt winning solid gains, Wall Street equities had opened higher following good results from Tesla and upbeat comments from leading airlines.
But US stock markets reversed course at mid-session, and ended decisively lower as the yield on the 10-year US Treasury note rose above 2.9 percent.
Fed Chair Jerome Powell, who has signaled the US central bank will have to move more aggressively to counter record US inflation, explicitly said a half-point interest rate increase is "on the table" for next month's policy meeting.
New York - Dow: Down 1.1% at 34,792.76
New York - S&P 500: Down 1.5% at 4,393.66
New York - Nasdaq: Down 2.1% at 13,174.65
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