Strong retail sales figures in the US help abate the fear of recession among investors and Asian markets mostly rallied on Thursday. With regard to Adani stocks, a few reports suggested that three Adani Group companies – Adani Power, Adani Total Gas and Adani Transmission – are expected to be removed from the MSCI India index during the rebalancing exercise in May.
Indices pare all gains in the final hour to close flat; TechM and ONGC shine
Indian shares mostly remained in the green on Thursday but gave up all the gains in the final hour to close in the flat territory with marginal gains.
The rally in the first half was led by IT and Metal stocks after the latest US retail sales data signalled strength in the world’s biggest economy, but Bank, Finance and Auto indices tumbled towards the end dragging the market.
The Nifty 50 index closed at 18,035, up by 20 points, while the S&P BSE Sensex gained 45 pts to end at 61,319.
Tech Mahindra and ONGC advanced 5% along with Apollo Hospitals which gained more than 3%. BPCL, Bajaj Finance and M&M shed in today’s session.
IT, Metal and Realty sectors led the first-half rally and jumped more than a per cent. Bank, Auto, and Finance indices closed in the red with marginal losses on Thursday.
Tokyo stocks ended higher on Thursday, with investors encouraged by rallies on Wall Street and a weaker yen against the dollar. The benchmark Nikkei 225 index closed up 0.71%, while the broader Topix index added 0.67% and closed at its highest in two-and-a-half months, as auto and tyre makers rallied following weakness in the yen.
Hong Kong stocks rose following gains in New York, as traders weighed data showing US consumers continued to spend last month despite rising interest rates and elevated inflation, suggesting the economy remained strong. Mainland China closed lower on Thursday.
The Hang Seng Index added 0.84%. The Shanghai Composite Index fell 0.96% while the Shenzhen Composite Index on China’s second exchange shed 1.70%.
European shares opened higher on Thursday on a boost from Airbus that also lifted France’s blue-chip index close to a record high, while miners led sectoral gainers as prices of commodities rose. The pan-Europe STOXX 600 index rose and France’s CAC led the gains among regional peers.
Akasa Air to place large plane order in 2023, eyes international growth
India’s Akasa Air will place a “substantially” large order for new narrowbody jets this year, as the start-up budget airline looks to capitalise on booming demand at home and begin international flights, its chief executive told Reuters.
The 200-day-old airline currently flies 17 Boeing 737 MAX planes out of a total order of 72 jets to be delivered by March 2027.
“Before the end of this year we are going to place another aircraft order that is going to be substantially larger than the 72 aircraft order we have placed,” Vinay Dube said during an interview without giving a specific number. (Read More)
China sanctions Lockheed Martin, Raytheon for Taiwan sales
China on Thursday imposed trade and investment sanctions on U.S. military contractors Lockheed Martin and Raytheon for supplying weapons to Taiwan, stepping up efforts to isolate the island democracy claimed by the ruling Communist Party as part of its territory.
The companies are barred from importing goods into China or making new investments in the country, the Ministry of Commerce announced.
It wasn’t clear what impact the penalties might have on Lockheed Martin or Raytheon. The United States bars most sales of weapons-related technology to China, but some military contractors also have civilian businesses in aerospace and other markets.
Taiwan and China split in 1949 after a civil war. The island never has been part of the People’s Republic of China, but the Communist Party says it is obliged to unite with the mainland, by force if necessary. (AP)
FCI sells 3.85 lakh tonne wheat in open market in second round of e-auction
Food Corp of India sold 3.85 3.85 lakh tonne of wheat of the 15.25 lakh tonne on offer in the second round of e-auction held on 15 February, the Ministry of Consumer Affairs, Food & Public Distribution said in a statement.
The Centre had last month said it would offload 3.0 million tonne of the essential commodity from its buffer stock under Open Market Sale Scheme to check the rise in wheat prices.
“In the second e-auction, quantities ranging from 100 to 499 MT had maximum demand followed by quantities of 500-1,000 MT, followed by 50-100 MT indicating that small and medium flour millers and traders actively participated in the auction. Only five bids were received for the maximum quantity of 3,000 MT at one go,” the ministry said. (Read More)
Realty index gains more than a per cent with most stocks trading in the green
Rekha Jhunjhunwala earns ₹1000 crore from this Tata stock in two weeks
Shares of Titan Company Ltd have been in uptrend post-Union Budget 2023. After closing at around ₹2,310 apiece levels on 2nd February 2023, Titan share price has been attracting buying interest by Dalal Street bulls for the last two weeks. In this time, this Tata group stock has risen from ₹2,310 to ₹2,535 per share levels, leading to rise in Rekha Jhunjhunwala net worth by more than ₹1,000 crore in this time. (Read More)
MSCI review: 3 Adani stocks could be axed in May as sell-off continues
Three Adani Group companies – Adani Power, Adani Total Gas and Adani Transmission – are expected to be removed from MSCI India index during the rebalancing exercise in May following a sharp correction in their stock prices, according to a report.
MSCI has said that it will postpone implementation of updates to weightings for two of Adani Group firms, Adani Total Gas and Adani Transmission, to the May benchmark review.
The reversal of the updates to Adani Total Gas and Adani Transmission in the February index review will be reflected in the MSCI Index Product files starting from 16 February, MSCI stated. (Read More)
Oil Rebounds as Traders Look for a Boost to Demand From China
Oil advanced after a two-day drop as investors assessed evidence of increased energy demand in China, the world’s top crude importer.
West Texas Intermediate rose above $79 a barrel after losing almost 2% over the previous two sessions as data showed US inventories swelled by more than 16 million barrels. Passenger loads at China’s top three airlines are rebounding as travel picks up again, adding to signs of increased mobility and energy consumption after refiners stepped up crude purchases and raised run rates.
Oil is slightly lower year-to-date as investors weigh a US plan to sell more oil from the Strategic Petroleum Reserve, and Russian output cuts planned for March. Against that mixed backdrop, International Energy Agency and the Organization of Petroleum Exporting Countries both issued more positive forecasts for the global market this week, with the IEA raising its consumption estimate for the first quarter as China reopens.
“All eyes are now on China’s comeback,” said Will Sungchil Yun, senior commodities analyst at SI Securities Corp. “Prices are likely to stay volatile in the next few weeks in the run-up to the National People’s Congress.” (Bloomberg)
Ambuja Cements declared preffered bidder for Odisha’s Uskalvagu limestone block
Ambuja Cements, which is part of the Adani Group, has been declared as the ‘Preferred bidder’ for the Uskalvagu limestone block in an e-auction conducted by the Odisha government.
The block is situated in the Malkangiri district of Odisha over an area of 547 hectare with an estimated limestone resource of 141 million tonnes having an average CaO (calcium oxide) content of 43.74 per cent.
“The company shall get the statutory licences and permits related to mining operations to be declared a ‘successful bidder’ and subsequently enter into a ‘Mine Development and Production Agreement (MDPA)’ with Government of Odisha to commence the mining operation,” Ambuja Cements said in a stock exchange filing on Thursday.
Ambuja Cements is among India’s leading cement companies.
Ambuja, with its subsidiary ACC Ltd, has a capacity of 67.5 million tonnes with fourteen integrated cement manufacturing plants and sixteen cement grinding units across the country. (ANI)
PL Stock Report: P.I. Industries (PI IN) and Apollo Hospitals Enterprise (APHS IN) – BUY
P.I. Industries (PI IN) — Himanshu Binani – Research Analyst, Prabhudas Lilladher Pvt Ltd
Rating: BUY | CMP: Rs3,122 | TP: Rs4,500
Q3FY23 Result Update – Outperformance continues..!!
§ CSM/domestic revenue growth of 23%/2% YoY.
§ CSM order book at USD1.8bn (+29% YoY and flat QoQ).
We increase our FY23/24/25E EPS estimates by 9%/4%/4% to factor in robust 9MFY23 performance. PI Industries (PI) 3QFY23 results were better than our and consensus estimates with Revenue/EBITDA/PAT growth of 19%/40%/58% YoY. Custom synthesis manufacturing (CSM) revenue grew 23% YoY to Rs13.3bn (PLe Rs13.4bn; volume/price growth of 9%/14% YoY), while domestic revenue merely grew 2% YoY to Rs2.84bn (PLe RsRs2.96bn; largely led by price growth). Favorable product mix coupled with better operating leverage resulted in overall EBITDA margin expansion of 390bps YoY to 25.7% (PLe 23.0%). Given increased demand for some existing molecules, CSM order book stood at USD1.8bn (+29% YoY and flat sequentially) largely favoring agri portfolio.
Citing robust demand momentum, we are positive on PI’s +20% YoY revenue growth guidance with significant improvement in margins ahead, primarily led by 1) strong enquiries in CSM business and 2) new launches in domestic segment. We expect Revenue/PAT CAGR of 20%/ 27% (FY11-22, 20%/26%) over FY22-25E. Maintain ‘BUY’ with revised TP of Rs4,500 (earlier Rs4,350) based on 40xFY25 EPS.
Apollo Hospitals Enterprise (APHS IN) — Param Desai – Senior Research Analyst, Prabhudas Lilladher Pvt Ltd
Rating: BUY | CMP: Rs4,488 | TP: Rs5,400
Q3FY23 Result Update – Strong show in hospital and SAP segment
§ Hospital occupancy to be closer to 70% in Q4.
§ Guided PAT level break-even for entire Apollo Health Co from Q3/Q4FY24.
Apollo hospitals enterprise’s (APHS) consolidated EBITDA of Rs5.1bn (down 4% QoQ) was in-line with our estimate. Adjusted for 24×7 losses (Rs2bn), EBITDA was at ₹7.1bn, up 10% YoY and down 4% QoQ vs our est of Rs6.85bn. We believe APHS has created a solid growth platform across segments and digital foraying has further made it a strong Omni channel play. The company also has good presence in offline format, making it more of a formidable player than just pure play online company. Though stake sale in Apollo HealthCo has been delayed, scale up in business is on track. Our FY24 and FY25E EBITDA stands reduced by ~5%, as we factor in higher losses from 24×7 and lower profitability in Apollo Health & Lifestyle Limited (AHLL). Overall we estimate 17% EBITDA CAGR over FY23-25E (ex 24×7). We maintain our ‘BUY’ rating with unchanged TP of Rs5,400/share as we roll forward to FY25. We ascribe 22x EV/EBITDA multiple to hospital segment, 20x EV/EBITDA to offline pharmacy and to AHLL and assign zero value to the 24/7 business.
TCS’ revenue to grow at a lower rate than Infosys in FY23, FY24: Moody’s
The revenue growth of country’s largest IT services company, Tata Consultancy Services (TCS) is seen lagging behind that of rival Infosys Ltd for this fiscal and the next. However, both the IT services companies are expected to grow at a moderate rate next financial year.
Rating agency Moody’s Investors Service expects 13 per cent revenue growth for Infosys and 8 per cent revenue growth for TCS in the fiscal ending 31 March.
Moody’s on Wednesday affirmed “Baa1” rating to two major IT services companies – TCS and Infosys. In two separate statements, the ratings agency has also retained stable outlook for both the firms. (Read More)
Nestle India zooms 2% after declaring its quarterly result
FMCG major Nestle India Ltd on Thursday reported an increase of 65.50 per cent in its net profit at ₹628.06 crore for the fourth quarter ended December 31, 2022.
The company, which follows the January-December financial year, had posted a net profit of ₹379.48 crore in the same period a year ago, Nestle India said in a regulatory filing. (PTI)
Airbus earns record net profit of 4.2 billion euros in 2022
European aircraft manufacturer Airbus said Thursday profits soared to a record level in 2022 despite supply chain problems limiting its ability to increase production.
Net profit rose one per cent to 4.2 billion euros ($4.5 billion) as Airbus delivered 661 aircraft last year despite original plans to hand over 720 to clients. Airbus had chopped production during the pandemic when airlines were forced to halt most operations due to travel restrictions. (Read More)
Nestle India Q4 PAT rises 66% YoY to ₹628 crore; ₹75 final dividend declared
FMCG major Nestle India on Thursday reported a net profit of ₹628 crore in the fourth quarter of CY22 (Q4CY22), up 66% year-on-year (YoY). It was ₹379 crore in the year-ago period.
The company, which follows a January-December financial year, announced its financial results on Thursday, 16 February.
The coffee and tea manufacturing company’s revenue from operations came in at ₹4,257 crore, up 13.5 per cent as compared to ₹3,748 crore in the year-ago period. (Read More)
Indices trade in the green with Sensex adding 270 pts and Nifty 75 pts; Tech M jumps 5%
Paytm shares: Alibaba sells stake during buyback period. Who bought?
One97 Communications (Paytm) has completed a buyback of shares worth ₹850 crore at an average price of ₹545.9 per share. The board had approved the buyback proposal crore on December 13, representing 6.67% of the total paid-up share capital between December 21, 2022 to February 13. The company bought back shares in the price range of ₹702 to ₹480 apiece.
“The company bought back an aggregate of 1,55,66,746 equity shares utilising a total amount of ₹849,83,39,982, which represents 99.98 per cent of the maximum buy-back size. The price at which equity shares were bought back was dependent on the price quoted on the stock exchanges,” Paytm had informed in an exchange filing earlier this week. (Read More)
PSU Bank index under pressure as it trades flat with half of the index stocks trading in red
Aditya Birla to sell stake in renewables business
Aditya Birla Group has hired Standard Chartered to sell up to 49% stake in the group’s renewable energy business to raise around $400 million, two people aware of the development said, as the conglomerate aims to bolster its position in India’s rapidly growing clean energy sector.
Aditya Birla Renewables aims to establish 4.5GW of installed renewable energy capacity by FY2026 through utility and commercial and industrial (C&I) projects, building upon its current project portfolio of 2GW, that comprises of existing and upcoming projects. With strong investor interest in the mature C&I segment, it offers insulation from risks such as power procurement curtailment by discoms. Open access allows large power users to buy power from the open market rather than relying on the more expensive grid. (Read More)
HAL gets DGCA nod for indigenously developed “black boxes”
The Hindustan Aeronautics Ltd said on Thursday it has received the Indian Technical Standard Order (ITSO) authorisation from Directorate General of Civil Aviation for its indigenously developed Cockpit Voice Recorder (CVR) and Flight Data Recorder (FDR). The ITSO is a minimum performance standard for specified materials, parts, processes, and appliances used on civil aircraft, the Bengaluru-headquartered HAL noted in a statement. CVR and FDR are popularly known as ‘black boxes’. However, these recorders are painted in orange colour to help in their recovery following an aircraft accident. CVR and FDR are used to record critical flight parameters and audio environment in a crash proof memory which is later used for investigation of aircraft incident or accident, it was noted. (PTI)
BPCL share drags in today’s session as it sheds a per cent
India’s Jan gold imports plunge 76% to 32-month low – govt source
India’s January gold imports plunged 76% from a year earlier to a 32-month low on subdued demand after domestic prices rallied to record highs and as jewellers postponed purchases, hoping for a reduction in import duty, a government source said.
The country imported 11 tonnes of gold in January, compared with 45 tonnes a year earlier, the source said on condition of anonymity, as he is not authorised to speak to the media.
In value terms, January imports dropped to $697 million from $2.38 billion a year earlier, he said on Thursday. (Reuters)
Adani Wilmar shares: KRChoksey sees 40% upside despite Hindenburg rout
Adani Wilmar shares bounced back strongly after receiving the heavy beating post-Hindenburg Research report raising concern over debt positioning of Adani group companies. The FMCG stock not just bounced back but it has been able to hold the gains it has registered from its lows. It seems that after the announcement of Q3 results 2023, market is showing confidence in this Adani group stock. KRChoksey believes that Adani Wilmar share price may go up to ₹569 apiece levels in long term, delivering around 40 per cent return to its positional shareholders.
On reasons for being bullish on Adani Wilmar shares, KRChoksey says, “Adani Wilmar Ltd has reported revenue of ₹1,54,381mn, an increase of 4.3% on a YoY basis and 3.9% on a QoQ basis, with volume growth across all the segments and good progress to gain market share across key product categories. Growth was driven by the extension of distribution networks, an increase in direct reach across urban and rural markets, and excellent execution in alternate channels.” (Read More)
Salesforce CEO took 10-day detox trip after sacking about 8000 employees
After laying off 10 percent of its workforce, Salesforce CEO Marc Benioff went on a 10-day digital detox trip. The CEO told The New York Times that went on a 10 day trip to French Polynesia.
“We’re so addicted to our devices (at least I am) that it’s very freeing to leave them all behind for a while!” the CEO told New York Times in a text message.
So what is a Digital Detox? It is a time when an individual voluntarily refrains from using his/her digital devices such as smartphone, computer, or his or her social media platforms. (Read More)
Reliance Industries shares rise 1%, ONGC gains 3% as govt cuts windfall tax on crude oil
Shares of oil refiners and producers surged on Thursday after the government slashed windfall taxes on domestically-produced crude oil and export duty on diesel and jet fuel due to falling oil prices in global markets.
In the sector pack BSE oil and gas, shares of RIL, ONGC, Indian Oil, GAIL were in the green, while Hindustan Petroleum, BPCL, Gujarat Gas were in the red.
Shares of the country’s most valued company, Reliance Industries advanced 1.08% to ₹2,456.35 on the BSE, while Oil and Natural Gas Corporation (ONGC) shares were trading 3.19% at ₹152.20 per equity share.
Metal index shines as it gains more than a per cent with almost all stocks trading in green
Adani Power’s ₹7k cr deal to buy DB Power assets falls through
Adani Power Ltd’s ₹7,017-crore deal to buy thermal power assets of DB Power has fallen after the initial pact expired.
“We wish to inform that the long stop date under the memorandum of understanding dated August 18, 2022, has expired,” Adani Power said in a regulatory filing on Wednesday.
Earlier in August 2022, Adani Power had informed the bourses that it has agreed to acquire DB Power Ltd (DB Power), which owns and operates a running 2×600 MW thermal power plant at district Janjgir Champa in Chhattisgarh.
Queries regarding the status of the deal sent to Adani Power did not elicit any response.
This assumes significance in view of allegations of fraud against Adani group by the US-based short-seller Hindenburg Research. This issue rocked Parliament also earlier this month and opposition had demanded Joint Parliamentary Committee as well as a Supreme Court monitored probe into the issue. (PTI)
Tech Mahindra shines in today’s trade as it jumps 3% continuing its yesterday’s rally
Air India has the option to buy an additional 370 aircraft: Nipun Aggarwal
Air India has the option to buy an additional 370 planes as part of its deal with aircraft manufactures Airbus SE and Boeing Co, said Nipun Aggarwal, the airline’s chief commercial and transformation officer.
The total order now stands at 840 aircraft, with a firm order of 470 airplanes including 250 aircraft from Airbus and 220 jets from Boeing. A firm order indicates confirmation while an option does not indicate confirmation and thereby, an airline can choose not to exercise an option. (Read More)
YES SECURITIES – Sequent BUY; Repco Home BUY; Prestige BUY; Carysil BUY
Sequent Scientific (SEQ IN): BUY
Target Price: ₹130
Potential Return: +83%
Margin recovery delayed but may not be denied
Overall, we reckon, after management guidance, expectation of a quick climb back to comfortable double digit margin have been pushed by a year which would create earnings phase in the interim, wherein EBIDTA growth would not be faster than topline. We cut FY24 estimate sharply as margin assumption is reduced from ~13% to 10% along with tweaking of below EBIDTA line item. Also bring in FY25 forecast and, while we still remain positive despite the sharp cuts, reckon recovery is firmly delayed by a year; roll over to FY25 forecast and retain BUY with revised TP Rs130, based on unchanged 35x FY25 EPS. Why 35x for such a struggling business? We believe some of the factors like elevated COGS, demand issues in Europe and API overstocking could reverse in the coming year which could bring traction in earnings, not fully captured when compared to historical gross margin/OPM.
Repco Home Finance Ltd (REPCO IN): BUY
Target Price: ₹350
Potential Return: +60.4%
Earnings beat despite slight growth miss
Repco’s valuation should track improving asset quality and growth trends in the long run. While co’s delivery on asset quality has been comforting, a secular improvement in loan book growth is keenly awaited. The structural growth manifestation would become clear over the next couple of quarters, in our view. We expect 12% loan CAGR over FY23-25 with avg. RoA/RoE delivery of 2.4%/12%. Growth beyond 15% and increase in dividend payout can raise RoE, given high Tier-1 capital.
Prestige Estates Projects (PEPL IN): BUY
Target Price: ₹617
Potential Return: +52%
On track to achieve guidance, focusing on BD
Prestige Estates Projects (PEPL) continued strong pre-sales by achieving over Rs25bn in Q3FY23 and collected Rs23bn while launched 4.06msf across segments and geographies. Also delivered 11.04msf of projects in Bangalore & Kochi. PEPL is confident to achieve Rs120bn presales guidance (9MFY23 Rs90.4bn) as the company has already done presales of ~Rs10bn in Jan’23. PEPL in next 4-5years is expected to add Rs24.7bn and Rs5.4bn annuity from office and retail projects respectively with a balance capex of Rs159bn. For Q3FY23 Net D/E was at 0.42x with a net debt of Rs41.7bn. We valued PEPL on SoTP based target 1xNAV of Rs617/share at WACC 12.1%, Cap rate 9% and 15x EV/EBITDA Avg. FY24E. We retain our ‘BUY’ rating.
Carysil Ltd (ACRY IN): BUY
Target Price: ₹656
Potential Return: +43%
Demand improving but near‐term headwinds to weigh on performance!
We believe on-going slowdown in overseas markets (78% of biz) is likely to weigh on company’s performance in near-term, hence we reckon Quartz sinks biz will witness a revenue growth of 4% over FY22-FY24E. Stainless Steel sinks & other biz are expected to report better growth owing to growing presence in domestic markets and new appliance capacity will contribute meaningfully to revenue from next fiscal. However, with lower utilization & higher cost, we expect margins to remain under pressure. Therefore, we reckon margins to come in at 15.9% in FY24E Vs 18.7% in FY23E. Given the multiple headwinds insight, we have revalued the company at P/E(x) of 22x on FY24E EPS of Rs29.8 & though we maintain our BUY rating on the stock, we have revised our target price downwards to Rs656.
Rupee gains 21 paise to 82.62 against US dollar
The rupee gained 21 paise to 82.62 against the US dollar in early trade on Thursday supported by broad dollar weakness and a firm trend in domestic equities.
Forex traders said upbeat domestic trade deficit data and foreign fund inflows supported investor sentiments.
At the interbank foreign exchange, the domestic unit opened at 82.72 against the dollar, then gained ground and touched 82.62, registering a rise of 21 paise over its previous close.
On Wednesday, the rupee settled at 82.83 against the US dollar.
Meanwhile, the dollar index, which gauges the greenback’s strength against a basket of six currencies, fell 0.25 per cent to 103.66.
Brent crude futures, the global oil benchmark, rose 0.50 per cent to USD 85.81 per barrel. (PTI)
IndiGo shares fall over 4% amid reports of block deal
Shares of InterGlobe Aviation Ltd, the parent of IndiGo fell over 4% in trade today amid report that Shobha Gangwal, the wife of IndiGo co-founder Rakesh Gangwal, will sell shares amounting to a four percent stake in the aviation company through a block deal.
IndiGo stock lost 4.48% to ₹1,897.00 against the previous close of ₹1,912.05 on NSE. The market capitalization of the aviation company stood at ₹73,346 crore. (Read More)
Oil & Gas index jumps a percent in the early trading with Adani Total leading the index’s rally
Japan’s Topix hits 2-1/2-month high, softer yen boosts auto stocks
Japan’s Topix index rose to a 2-1/2-month high on Thursday, with auto and tyre makers leading the charge on the back of a weaker yen, while Wall Street’s strong finish overnight also lifted market sentiment.
The broader Topix had gained 0.73% to 2,002.22 by the midday break, hitting its highest since Nov. 28. The Nikkei was up 0.81% at 27,723.60.
“The weakened yen lifted sentient. There were not many market-moving cues, but the market was firm,” said Shigetoshi Kamada, general manager at the research department at Tachibana Securities.
The yen hovered near a six-week low against the dollar after strong U.S. retail sales data drove the greenback’s gain.
A softer yen tends to help exporter shares as it increases the value of overseas profits in yen terms when firms repatriate them to Japan. (Reuters)
Apollo Hospitals gains 3% in early trading and leads the market rally
Geojit Financial Services on today’s market: Breaking the 18200 Nifty resistance would be tough.
Dr V K Vijayakumar, Chief Investment Strategist at Geojit Financial Services: Two factors have contributed to the ongoing mild rally in the market. One, the global market construct is favourable and, two, the bulls have been emboldened by the apparent change in FII strategy from selling to buying. This favourable backdrop can sustain the rally but breaking the 18200 Nifty resistance would be tough.
Incoming data indicates that the possibility of a soft landing for the US economy is improving. After the blockbuster jobs data, the latest January US retail sales data also is impressive, indicating a resilient economy. Therefore, the US markets are discounting a soft landing for the U S economy in contrast to a hard landing feared earlier.
In India, the big positive is the FIIs turning buyers during the last four days. They might again sell at higher levels, but it appears that the sustained selling from early January till 9th February is over. IT, leading banks, capital goods and RIL may help sustain the rally in the near-term but not for long.
KPMG becomes first Big Four accounting firm to cut staff
KPMG is cutting close to 2% of its workforce in the United States, becoming the first of the world’s four biggest accountancy firms to slash jobs in the country, the Financial Times reported on Wednesday citing an internal announcement.
Several financial firms have slashed jobs in recent months including major Wall Street banks, asset managers and fintechs amid a turbulent macroeconomic environment that has pressured consumers and soured demand in several mainstay business units. (Read More)
Indices jump at open as Sensex opens 300 pts up and Nifty almost 100 pts
Tech Mahindra continues to shine as it leads the rally
Debt in focus as G20 finance chiefs meet in India
G20 finance and central bank chiefs meet in India next week at the first-year anniversary of Russia’s invasion of Ukraine to discuss rising debt troubles among developing countries, the regulation of cryptocurrencies and the global slowdown.
The Feb. 22-25 meeting in the Nandi Hills summer retreat near Bengaluru is the first major event of India’s G20 presidency and will be followed by a March 1-2 meeting of foreign ministers in New Delhi.
As global borrowing costs rise, India – whose neighbours Sri Lanka, Pakistan and Bangladesh have all sought International Monetary Fund support in recent months – wants to put debt relief at the forefront of discussions at the finance talks.
It is drafting a proposal for G20 countries to help debtor nations badly hit by the economic impact from the pandemic and the Ukraine war, by asking big lenders including China to take a large haircut on loans, Reuters reported on Wednesday. (Reuters)
Sensex preopens in the green as Adani stocks, IndiGo, and Nestle India will be in focus in today’s session
India’s Modi Likely to Retain Wheat Export Curbs as Polls Loom
Keeping the cost of staple foods in check to protect the poor will be a top priority for Indian Prime Minister Narendra Modi as he plans for polls in several states this year and the all-important general election in 2024.
That means the government will likely extend export curbs for wheat, which is an essential part of the diet and key to food security for many of the country’s 1.4 billion people. State reserves of wheat used to supply the food program for the poor have shrunk to the smallest for this time of year since 2017, which shows the premier has good reason to take no chances on the restrictions.
An extension of the export curbs would probably bolster the global wheat market, where supplies are tight because of dry weather in US growing areas and a drop in Ukrainian supplies after Russia’s invasion almost a year ago.
While the farm ministry and some traders expect the country’s wheat production to reach a record 112 million tons this year, it’s still too early to say a crop of that size is in the bag. Output is at risk if temperatures in the key northern growing regions climb unexpectedly through to the end of March, said Rajnikant Rai, divisional chief executive of ITC Agri Business, part of ITC Ltd., a cookie and flour maker and one of the top wheat buyers. (Bloomberg)
Reliance Securities Stock in Focus for Today: EPL
STOCK IN FOCUS
EPL(CMP 157) – In view of the improvement in balance sheet, higher return ratios and attractive valuation, we have our BUY rating on EPL, with a Target Price of Rs215.
BAJAJFINSV (PREVIOUS CLOSE: RS1,421) BUY
For today’s trade, long position can be initiated in the range of Rs1,412-
1,406 for the target of Rs1,450 with a strict stop loss of Rs1,384.
TATACONSUM (PREVIOUS CLOSE: RS728) BUY
For today’s trade, long position can be initiated in the range of Rs723-
718 for the target of Rs744 with a strict stop loss of Rs714.
LTIM (PREVIOUS CLOSE: RS4,743) BUY
For today’s trade, long position can be initiated in the range of Rs4,675-
4,650 for the target of Rs4,880 with a strict stop loss of Rs4,580.
Adani Ports halts non-group loans, to cut debt instead
Adani Ports and Special Economic Zone Ltd will discontinue lending money to non-group companies after having lent at least ₹12,687 crore last year, according to a Mint analysis. Instead, the Gautam Adani-controlled company will use surplus funds to cut its ₹44,000 crore debt pile.
Adani Ports’ management disclosed the information to analysts from Pimco, Deutsche Bank, and JP Morgan Asset Management in response to queries regarding the nature of the loans extended to non-related parties or those not owned by the group promoter. (Read More)
Rupee likely to open higher tracking Asia FX, improving near-term outlook
The Indian rupee is expected to open slightly higher against the U.S. currency on Thursday, tracking an uptick in most Asian currencies despite an overnight surge on the dollar index.
The non-deliverable forwards indicated that the rupee will open at 82.70-82.75 to the dollar, compared with 82.8025 in the previous session.
The local currency on Wednesday managed to hold above the closely watched 82.90-83.00 level despite mounting concerns over U.S. interest rates.
Wednesday’s session will reinforce the belief that it is quite difficult for USD/INR to move above the 83 level, a trader at a Mumbai-based bank said. Add to that the trade data and it looks like USD/INR may be headed to the lower side of its recent range, the trader said.
India’s merchandise trade deficit in January hit its lowest in a year at $17.75 billion, data showed. (Reuters)
Back Stocks to Watch: Adani Total, Adani Ports, IndiGo, Vodafone, NTPC, HAL, Adani Transmission, Bharat Electronics, Paytm, Hindustan Aeronautics, and Pitti Engineering
Nestle India and Schaeffler India will be among the stocks in focus as they declare their December quarter earnings today. (Read More)
Govt cuts windfall tax on crude oil, ATF, export of diesel
The Central government on Thursday slashed windfall profit tax levied on domestically-produced crude oil, as well as on the export of diesel and aviation turbine fuel (ATF), in line with firming international oil prices, according to an official order.
The levy on crude oil produced by companies such as Oil and Natural Gas Corporation (ONGC) has been cut to ₹4,350 per tonne from ₹5,050 per tonne, the order read.
The government has also trimmed the tax on export of diesel to ₹2.50 per litre from ₹7.5 a litre. Petrol continues to have nil special additional excise duty. (Read More)
PNB, Ambuja Cements continue to be among 4 stocks under F&O ban for trade on NSE
A total of four stocks have been put under the ban for trade on Thursday, February 16, 2023 under the futures and options (F&O) segment by the National Stock Exchange (NSE). The securities have been put on ban under the F&O segment as they have crossed 95% of the market-wide position limit (MWPL), as per the NSE.
Ambuja Cements, Indiabulls Housing Finance, Punjab National Bank (PNB) and Bharat Heavy Electricals Limited (BHEL) stocks continue to be part of the F&O ban list by the stock exchange for today as the derivative contracts in the mentioned securities have crossed 95% of the market-wide position limit and are therefore have been currently put in the ban period by the stock exchange, said NSE. The NSE updates the list of securities in F&O ban for trade every day. (Read More)
Vedanta declared preferred bidder for bauxite block in Odisha
Vedanta Ltd on Wednesday said that it has been declared as preferred bidder for a bauxite block in Odisha.
Sijimali bauxite bock is located in Rayagada and Kalahandi districts of Odisha.
“Vedanta Ltd has been declared as the preferred bidder for Sijimali bauxite block… under the mineral block auction conducted by the government of Odisha,” the company said in a filing to BSE.
The mine is a strategic fit for Vedanta given its size, location, and bauxite quality, the company said, adding that the block has an estimated reserves of 311 million tonnes of bauxite.
Vedanta Ltd, a subsidiary of Vedanta Resources Ltd, is a diversified global natural resources company with significant operations in oil and gas, zinc, lead, silver, copper, iron ore, steel, and aluminium and power across India, South Africa and Namibia. (PTI)
Elon Musk Nears World’s Richest Title Again
Elon Musk is closing in on recapturing his title as the world’s richest person since falling behind Bernard Arnault in December, thanks to Tesla Inc.’s 74% rise this year.
It may take a bit longer for Musk to overtake the French luxury-goods titan, though, after disclosing this week he gave 11.6 million Tesla shares to unnamed charitable causes between August and December. The stock was worth about $1.9 billion, based on closing prices on the days Musk donated the securities.
The disclosure comes as Musk, 51, has narrowed the gap to Arnault to less than $1 billion amid signs of growing demand for Tesla’s electric vehicles.
He now has a fortune of about $191.3 billion after his latest donation, according to the Bloomberg Billionaires Index. That’s down from a peak of more than $300 billion in late 2021 before he decided to buy Twitter in a leveraged buyout near the peak of the tech market, but up more than $54 billion this year. (Bloomberg)
Adani Power’s deal to acquire DB Power expires
Billionaire Gautam Adani-Adani Power’s planned ₹7,017-crore acquisition of thermal power assets of DB Power Ltd has collapsed as the deadline to complete the transaction expired. The agreement to acquire the company was announced in August 2022.
“We wish to inform that the long stop date under the memorandum of understanding dated August 18, 2022, has expired,” Adani Power said in an exchange filing on Wednesday, without providing any information about the extension of dates or agreement renegotiation.
By announcing the expiry of the long stop date, the power sector arm of the Adani Group has virtually called off the acquisition deal. (Read More)
Buy or sell: Vaishali Parekh recommends 3 stocks to buy today
Vaishali Parekh of Prabhudas Lilladher recommended three stocks to buy today and those three stocks are REC, Tata Consumer and McDowell or United Spirits Ltd.
1] REC: Buy at ₹115.50, target ₹120, stop loss ₹113;
2] Tata Consumer: Buy at ₹728, target ₹750, stop loss ₹718; and
3] United Spirits or McDowell: Buy at ₹787, target ₹815, stop loss ₹777. (Read More)
MSCI postpones implementation of updates for two Adani Group firms
Index provider MSCI said it will postpone implementation of updates to the Foreign Inclusion Factors for two of Adani Group companies–Adani Total Gas and Adani Transmission, to the May index review.
It said that the reversal of the updates to Adani Total Gas and Adani Transmission in the February Index Review will be reflected in the MSCI Index Product files starting today (16 Feb).
MSCI will also apply a special treatment for all Adani Group’s associated securities in the MSCI Equity Indexes starting from February 2023. (Read More)
IndiGo co-founder Rakesh Gangwal’s wife to sell stake worth $350 mn in block deal
Shobha Gangwal, wife of IndiGo co-founder Rakesh Gangwal, is set to sell a 4% stake in India’s largest airline, worth $353 million, through a block deal scheduled for Thursday, according to deal terms reviewed by Mint.
This is the second instance of a share sale by the Gangwal family in InterGlobe Aviation Ltd, which operates IndiGo, after selling a 2.8% stake in the airline for approximately $250 million in September. Gangwal family owned a 33.78% stake in the airline as of 31 December, stock exchange data showed. (Read More)
Wall St closed higher on Wednesday while the dollar gained after strong economic data
Wall Street’s three major indexes closed higher on Wednesday and the dollar rose along with U.S. Treasury yields after U.S. retail sales data for January rose by the most in nearly two years, suggesting a resilient economy while fueling concerns about further interest rate hikes.
After two straight monthly declines, the Commerce Department said retail sales surged 3.0% last month, the largest increase since March 2021, after declining by an unrevised 1.1% in December.
Paired with Tuesday’s data showing a monthly inflation pick-up in January, evidence of an increase in consumer spending fed worries the U.S. Federal Reserve would keep increasing rates for longer than some investors had hoped.
“It’s all about the Fed. As figures like retail sales come out quite strong, this is more food for the Fed to keep raising rates, maybe at reduced pace, but, at the very least, to keep them higher for longer,” said Bruce Zaro, managing director at Granite Wealth Management.
The Dow Jones Industrial Average rose 38.78 points, or 0.11%, to 34,128.05, the S&P 500 gained 11.47 points, or 0.28%, to 4,147.6 and the Nasdaq Composite added 110.45 points, or 0.92%, to 12,070.59.
MSCI’s gauge of stocks across the globe gained 0.04% but has risen almost 8% so far this year. (Reuters)
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