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PremiumIndian indices were down around 0.50% at market closing on Tuesday. News of potential steel export tax in China led to a rally in metal stocks. Asian markets were mixed at close on Tuesday. All eyes will be on Big tech earnings due this week, the results of the US Federal Reserve policy meeting concluding Wednesday and US GDP data due out on Thursday.
The Sensex closed at 52,578.76, down 273.51 points, or 0.52%, while the Nifty was at 15,746.45, down 78.00 points, or 0.49%. On the 30-share Sensex, Tata Steel, Bajaj Finserv, SBI, and eight other stocks closed in green, while Dr Reddy's, Axis Bank, Sun Pharma, and 16 other stocks closed in red.
Crude oil prices rose ₹6 to ₹5,362 per barrel on Tuesday, as participants widened their positions on a firm spot demand. On the Multi Commodity Exchange, crude oil for the August delivery traded higher by ₹6, or 0.11%, to ₹5,362 per barrel in 5,855 lots. Analysts said raising of bets by participants kept crude oil prices higher in the futures trade. Globally, West Texas Intermediate crude oil traded lower by 0.10% to $71.84 per barrel, while Brent crude traded 0.07% up at $74.55 per barrel in New York.
Dr Reddy’s Laboratories reported total revenue from operations at ₹4,919 crore, up by 11% year-on-year (y-o-y), from ₹4,417 crore in Q1FY21. India generic business has done well for the company, up by 69%, at ₹1,060 crores while API was down by 12% at ₹754 crore. Gross profit margins were down by 380bps y-o-y at 52.2% as raw material prices have gone up in the last 2 quarters. Profit before tax for the quarter was down by 16% at ₹742.5 crore as compared to ₹878.9 crore in Q1FY21. Ebitda margins have also come down from 26.3% to 20.7% in Q1FY22. Profit after tax for the quarter came in at ₹570.8 crore in Q1FY22 as compared to ₹579.3 crores, down by 1%.
We believe that the weaker set of numbers reported by Dr Reddy’s Laboratories are due to sales degrowth in API business and muted sales growth in US business. India business and Europe business have reported sales growth of 69% and 12%, respectively. Companies' margins are down significantly and were below the market expectation. Companies gross margin and Ebitda margin are down by 380 bps and 560 bps y-o-y as Q1FY2021 was high base quarter for the company, but margins were down on a quarter-on-quarter basis as well. "
Adani Ports and Special Economic Zone Ltd has issued senior unsecured dollar notes worth $750 million in tranches of 20 years and 10.5, with a fixed coupon of 5% and 3.8%, respectively. The issuances, which closed on 26 July, were 3X oversubscribed.
Dixon Tech's stock was trading at ₹4,525.05 each down 0.14%. The company reported Q1 consolidated net profit ₹181 million compared to ₹16 million a year ago. The company’s Q1 ebitda was ₹ 479 million compared to ₹168.9 million a year ago.
The Supreme Court Tuesday ordered status quo in the Kirloskar Brothers Ltd family feud related to assets wherein KBL's CMD Sanjay Kirloskar has challenged the Bombay high court order directing arbitration in the case. The apex court's status quo will also extend to the proceedings in the Pune civil court on KBL seeking damages for violation of the family deed. Asking the parties involved in the case to explore the possibility of mediation, a bench comprising Chief Justice N V Ramana and Justice Surya Kant issued notice on the appeal by Sanjay Kirloskar and asked them to file replies within six weeks.
The top court asked Kirloskar brothers - Sanjay and Atul with others to explore mediation to resolve the family dispute relating to the assets. (PTI)
Axis Bank on Tuesday said it has bought 5.55% stake in financial technology firm IBBIC. The bank has subscribed to 50,000 equity shares of face value of ₹10 each fully paid up of IBBIC Private Ltd (IBBIC) for a consideration of ₹10 per equity share constituting 5.55% of the issued and paid up capital of IBBIC, Axis Bank said in a regulatory filing. (Read here)
"During the 1QFY22, TTK Prestige Ltd (TTK) reported consolidated revenue of ₹401 crore (up 77% year-on-year) mainly due to healthy volume growth and improvement in realisation. EBITDA increased by 634% y-o-y to ₹44 crore, while ebitda margin improved by 834 bps y-o-y to 11% due better operating leverage. On the bottom-line front, the company has reported consolidated net profit of ₹31 crore (against ₹2 crore in1QFY21) due to lower base last year in the same quarter. Going forward, we expect that the company will report a healthy top-line & bottom-line growth on back of the strong brand & wide distribution network, new product launches and increase in demand for kitchen products post covid-19."
IRB Infrastructure Developers has raised ₹381.63 crore with an investment of ₹194.63 crore in the IRB Infrastructure Trust, launched in partnership with Singapore based GIC Affiliates.
Torrent Gas Ltd, the gas distribution arm of $3 billion Torrent Group will invest ₹5000 crore in Tamil Nadu over the next five years to lay infrastructure for its city gas distribution (CGD) business. The company plans to invest around ₹10,000 crore over the next five years across the country. (Read here)
Ratings firm Crisil expects the fast-moving consumer goods (FMCG) sector to report 10-12% growth in revenues this fiscal doubling from the previous year, the firm said in a research note released on Tuesday. The growth—the highest in the last three fiscals—will be driven by a combination of price-led growth and a favourable base in the last fiscal. It expects demand for discretionary products to improve too in the near-term. Meanwhile, demand in urban markets is set for growth marginally ahead of rural markets, reversing a trend reported by most large FMCG companies last fiscal. Crisil analysed 57 Crisil-rated FMCG companies. These companies represent close to one third of the sectoral revenues of ₹4.2 lakh crore (FY21).
- The two day FOMC Policy Meeting (27-28 July 2021) is likely to end tomorrow and the release of the policy statement may draw heightened interest given the uptick in concerns around the delta variant.
- The US Fed Funds target rate range of 0-0.25% and the monthly QE asset purchases is likely to remain the same.
- In his recent statement, the US Fed Chair made it clear that the inflation pressures are largely transitory which means that an imminent shift in policy is unlikely. However, there could be discussions surrounding the path of tapering.
- Nonetheless, there is a growing hawkishness creeping into the viewpoints expressed by other FOMC members given the strong economy and the fact that inflation is running at more than double its 2% target.
- Any hints or talks of a September tapering and improving global growth environment, could push the US Dollar Index higher in turn hampering all other currencies.
"Industrial metals traded higher in today’s session as severe flooding in China’s major industrial regions raised concerns over potential supply shortage in the global markets. Also, a weaker US Dollar ahead of the Federal Open Market Committee’s two-day meeting which begins on Tuesday further supported the Base metals. Markets might cautiously wait for the outcome of the meet for cues on the US Federal Reserve’s stance in the coming months. However, China’s announcement to release another batch on industrial metals later this week in an attempt to ease Commodity prices kept the gains in check."
The initial public offering (IPO) of Glenmark Life Sciences Ltd was fully subscribed within hours of opening on the first day, led by robust demand from from retail investors. The overall book, excluding the anchor allotment, was subscribed 1.15 times. As of 1210pm, the retail investor category was subscribed 2.25 times while the non-institutional portion was subscribed 0.17 times. The portion set aside for qualified institutional buyers was yet to receive bids. (Read here)
The company's stock was trading at ₹2,378.55 each, up 5.68% at 12:31 pm. On 23 July, the National Company Law Appellate Tribunal (NCLAT) on Friday declined to stay the resolution plan of Dewan Housing Finance Corporation Ltd (DHFL) and its subsequent takeover by the successful bidder Piramal Capital & Housing Finance over the plea filed by 63 Moons Technologies.
-Vodafone Idea may file a review petition with respect to Supreme Court's AGR order
-The Supreme Court had dismissed telcos' pleas seeking recalculation of AGR dues
--CNBCTV18
Brokerage firm Macquarie Securities has downgraded Axis Bank stock to neutral following its disappointing first quarter performance. In its research report, Macquarie said that the private sector lender reported lower than expected net profit of ₹2,160 crore owing to higher credit costs and lower margins. “We are cutting FY22-24E EPS by 8-9% driven by a ~20bp increase in credit costs and a 10-20bp reduction in margins. Our TP remains unchanged as it is largely based on our sustainable ROE of 15.7% which remains unchanged, said Macquarie in its report.
Indian stock markets edged higher today bfailed to extend gains in noon trade, amid selling pressure at higher levels. Nifty was trading 0.2% higher at 15,860 after rising to 15,881 at day's high. Sensex had also pared early gains and trade just 50 points higher. Nifty has been stuck in the 15600 to 15900 range in over a month, testing the patience of investors. (Read here)
Dr Reddy’s Laboratories' stock was trading at ₹5,291.95 each, down 2.17% at 11:33 am. The company reported consolidated first quarter net profit of $5.7 billion compared to ₹5.95 billion a year ago. First quarter ebitda stood at ₹10.2 billion compared to analyst estimates of ₹11.9 billion.
Mohalla Tech, the parent company behind Moj and ShareChat, has raised an additional $145 million as an extension to its Series F round led by Singapore state investor Temasek, Moore Strategic Ventures (MSV) and Mirae-Naver Asia Growth Fund. (Read here)
The USFDA may conduct onsite inspection at Aurobindo Pharma's facilities, CNBCTV18 reported, citing people familiar with the matter.
ESAF Small Finance Bank has filed preliminary papers with capital markets regulator Sebi to raise ₹998 crore through an initial public offer (IPO). The ₹997.78-crore public issue comprises fresh issue of equity shares worth ₹800 crore and an offer for sale of ₹197.78 crore by existing selling shareholders, the draft red herring prospectus (DRHP) filed with Sebi showed.
Inox Leisure has refuted reports indicating discussion around potential acquisition by Amazon.
Realty major DLF Ltd posted decent earnings in the June quarter on the back of its development business. Reacting to the earnings, shares of the company rose nearly 3% on the NSE in Tuesday's opening trade to hit a new 52-week high of ₹344. (Read here)
InterGlobe Aviation Ltd, which runs India’s largest airline, IndiGo, is scheduled to announce its June quarter (Q1FY22) results today. Expectations are not running high and understandably so. The reason is simple. The recovery in passenger traffic that the aviation sector was witnessing until February came to a pause with the second wave and the ensuing restrictions. Add to this, crude oil prices have inched up, which means operating costs increase for airlines. For perspective: average aviation turbine fuel (ATF) prices in Q1FY22 increased by around 97% year-on-year and 12% against the March quarter (Q4FY21). (Read here)
Infrastructure company Larsen & Toubro's (L&T) June quarter earnings were a mixed bag. While the operating performance of its core engineering and construction (E&C) was largely in-line with expectations, weakness in the finance business led to a miss in profit after tax. Also, its execution was weaker-than-expectations. But a key disappointment for investors in this stock came from the weak order inflows. The company's order inflow of ₹15,100 crore, rose 10% year-on-year, but still remains below pre-pandemic Q1FY20 levels of ₹30,000 crore.
Alembic Pharma's stock was trading at ₹828.00 each, down 9.09% at 10:09 am. The company withdrew its earnings guidance after it reported Q1 net sales of ₹1,269.69 crore, up 0.89% from ₹1,258.43 crore a year ago. Quarterly net profit was at ₹192.69 crore in June 2021 down 39.53% from ₹318.64 crore in June 2020.
"The Nifty continues to be spiritless in its momentum; the range bound movement still persists! Until we do not get past 15,900 on the upside or break 15,400 on the downside, we will be far from witnessing a definite trend. While the propensity remains on the upside, the test of patience is challenging. A buy on dips can be looked at a possible trading strategy."
Glenmark Life Sciences Ltd's initial public offering (IPO) opens for subscription today and will be opened for bidding till July 29. The price band for the initial share sale is fixed at ₹695-720 per share. Its IPO size has been reduced as it will now consist of a fresh issue of ₹1,060 crore and offer for sale (OFS) of up to 63 lakh shares by its promoter Glenmark Pharma. The company is aiming to raise ₹1,515 crore through its share sale. (Read here)
Tatva Chintan IPO: Ahead of finalisation of share allotment, all eyes are now set on Tatva Chintan IPO listing date i.e. 29th July 2021. However, before listing of Tatava Chintan shares at NSE and BSE, grey market has already started signaling the bullish expectations of the markets. According to the stock market observers, Tatva Chintan IPO GMP (grey market premium) today is ₹1150, which is ₹90 higher from its yesterday's share price in the grey market. Market observers said that the rising trend in the Tatva Chintan IPO grey market premium indicates strong listing of the shares as fundamentals of the company is also very strong. (Read here)
Equitas Holdings' stock was trading at ₹134.60 each, up 8.16% at 9:38 am. The board of directors and shareholders of Equitas Holdings Ltd (EHL) and Equitas Small Finance Bank (ESFB) on Monday approved the amalgamation scheme of the two companies. The share exchange ratio would result into each shareholder of the transferor company, EHL, getting 226 equity shares of the transferee company, ESFB, for every 100 shares held by them in the holding company. EHL (transferor company) is the promoter or the holding company of ESFB (transferee company).
Zomato's stock was trading at ₹146.85 each, up 4.26% at 9:32 am. The foodtech companyis set to double down on the online grocery market. The food delivery platform, which went public last week, will lead a ₹3,500 crore ($470 million) investment in Grofers, which turned unicorn recently, two people directly aware of the development said.
The Sensex opened at 52,995.72 , up 143.45 points or 0.27%, while the Nifty
was at 15,860.50, up 36.05 points, or 0.23%.
At market pre-opening, the Sensex was at 52,995.72, up 143.45 points or 0.27%, while the nifty was at 15,860.50, up 36.05 points, or 0.23%.
In cryptocurrencies, Bitcoin prices fell after surging to $40,000 level after speculation that Amazon may be entering the cryptocurrency sector after it posted a job seeking a “digital currency and blockchain product lead." The five-week intra-day high reached Monday comes after a long slide where it dipped under $30,000 from an April high of nearly $65,000. (Read here)
Markets are likely to remain in consolidation mode on Tuesday while trends in SGX Nifty suggest a positive opening of Indian benchmark indices. On Monday, the BSE Sensex ended at 52,852.27, down 123.53 points or 0.23%. The Nifty closed at 15,824.45, down 31.60 points or 0.20%. (Read here)
Fuel prices remained unchanged for the tenth consecutive day on Tuesday, however, remained at the record high levels. Petrol is retailing at ₹101.84 in Delhi, whereas diesel at ₹89.87. In India's financial capital Mumbai, petrol is being sold at ₹107.83 per litre, whereas diesel at ₹97.45 per litre.
In Kolkata, petrol prices stand at ₹102.08 per litre and diesel prices at ₹93.02 per litre. In Chennai, petrol prices at ₹102.49 per litre; diesel prices – ₹94.39 per litre. (Read here)
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