IndusInd Bank Q1 net profit jumps 60.5% YoY to Rs 1,631.1 crore, beats estimate
IndusInd Bank on July 20 reported a 60.5 percent year-on-year rise in net profit to Rs 1,631.1 crore for the quarter ended June, which was above analysts' expectations of Rs 1,423.5 crore.
Shrikant Chouhan, Head of Equity Research (Retail), Kotak Securities
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The market is mirroring the mood in global equities and notched up significant gains on strong buying in IT and select media and realty stocks. Basically, the market is hoping that the US Fed may not be aggressive in hiking rates in its next meeting, while falling commodity & crude oil prices too have moderated the bearish trend in recent sessions. On the technical front, the Nifty has formed a small bearish candle near the important resistance level.
Due to markets being in an temporary overbought situation, we could see some profit booking at higher levels. For bulls, 16550 and 16600 would act as an immediate resistance zone. On the flip side, 16450-16400 could be key support levels.
Deepak Jasani, Head of Retail Research, HDFC Securities
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Nifty rose for the fourth consecutive session helped by overnight gains in the US and reduction of windfall tax by the Indian government on fuels. Nifty opened gap up and inched higher till 1245 Hrs and later slipped. At close Nifty was up 1.1% or 180.3 points at 16520.9. Volumes on the NSE were the highest since June 17.
Nifty broke out upwards with an upgap on Wednesday but closed near the intra day lows, suggesting profit taking at highs. While volume expansion is supportive of further upmove, we will have to see whether the upgap made by Nifty at 16359 is filled or not in the next 1-2 days. Nifty could now remain in the 16359-16646 band for the near term.
Rupak De, Senior Technical Analyst at LKP Securities
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Nifty found resistance at the higher levels as it reached the upper band of the rising channel on the daily chart. Over the near term, the index may consolidate till it gives a breakout above 16600. On the lower end, 16350-16400 may remain crucial support. A buy on dips strategy is likely to work as long as the Nifty holds above 16350.
Care Ratings to buy back shares of up to Rs 120 crore at Rs 515 per share via tender offer
The Board of Directors of CARE Ratings approved a proposal to buy back of up to 23,68,000 fully paid-up equity shares of face value of Rs 10 each representing 7.99% of the total issued and paid-up equity share capital of the Company) at a price of Rs 515 per equity share.
Rupee at close
Rupee ends at 79.99 per US dollar against July 19 close of 79.94 per US dollar.
Kunal Shah, Senior Technical Analyst at LKP Securities
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Bank Nifty index faces some profit booking at a higher level but remains in an uptrend with a buy on dip approach. The immediate hurdle on the upside is at the 36,300-36,500 zone which coincides with its 200-DMA. The index might consolidate in the range of 35,500-36,500 with positive bias as long as the mentioned support is held on a closing basis.
Wipro Q1: Revenue at Rs 21,285 crore. EBIT at Rs 3,183.2 crore. EBIT margin at 15%. Dollar revenue at $ 2,735.5 million.
Vinod Nair, Head of Research at Geojit Financial Services
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Indian stocks led a steady climb as a result of encouraging signals from both domestic and international markets. Reduced export duty and windfall taxes improved the mood of oil producers. Strong quarterly results in the US market boosted the rally, while the European market rose as worries over Europe's energy supply eased. If sustained buying from FIIs prevails, it will provide a cushion to the upward rally in the domestic market.
Market at close: Benchmark indices ended in the green with handsome gains from IT, metals and FMCG names. Sensex is up 629.91 points or 1.15% at 55397.53, and the Nifty jumped 180.30 points or 1.10% at 16520.80. About 1857 shares have advanced, 1409 shares declined, and 128 shares are unchanged.
NCLT admits Bank of India petition to initiate insolvency proceedings against Future Retail Ltd (FRL)
NCLT admits Bank of India petition to initiate insolvency proceedings against Future Retail. However, NCLT dismissed Amazon's intervention application in Future Retail case.Bank of India moved NCLT to seek insolvency proceedings against FRL in April
Short build-up
Short build-up was witnessed in ICICI Lombard General Insurance Company, HPCL and Polycab India
Market at 3.00 PM
Indices trade positive but Realty and Auto lose some growtd; Nifty below 16,550
Sensex is trading higher by 645.49 points or 1.18 percent at 55,413.11; Nifty is up 187.05 points or 1.21 percent at 16,537.60. Of the 3,453 stocks traded on the BSE, there were 1961 advances, 1330 stocks declined while 162 stocks remained unchanged.
Source: BSE
Anuj Choudhary - Research Analyst at Sharekhan by BNP Paribas
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Indian rupee traded on a flat note today. rupee opened in the green on weak dollar and surge in domestic equity markets. However, concerns over twin deficits capped sharp gains. Dollar fell on decline in safe haven appeal amid positive global risk sentiments and weak housing data from US. US housing starts declined by 2% to 1.559 million in June from 1.591 million in May.
We expect rupee to trade with a negative bias as rising current account deficit and trade deficit may put pressure on rupee. Dollar may also strengthen again on expectations of an aggressive rate hike by Fed later this month. Traders may also take cues from existing home sales data from US later today which is expected to remain weak. USD-INR spot price is expected to trade in a range of Rs 79.20 to Rs 80.80 in next couple of sessions.
Century Plyboards Q1: Consolidated net profit at Rs 92.3 crore against Rs 31.4 crore (YoY). Consolidated revenue jumped 94.3% at Rs 889 crore against Rs 457.5 crore (YoY). EBITDA at Rs 143.1 crore against Rs 60.2 crore (YoY). Margin at 16.1% against 13.2% (YoY).
European Markets Updates
Russia likely to restart gas exports from Nord Stream 1 on schedule: Russian sources
Russian gas flows via the Nord Stream 1 pipeline are likely to restart on time on Thursday after the completion of scheduled maintenance but at lower than its full capacity, two Russian sources familiar with the export plans told Reuters.
The pipeline, which accounts for more than a third of Russian natural gas exports to the European Union, was halted for ten days of annual maintenance on July 11.
Syngene International Q1: Consolidated net profit went down 4.4% at Rs 73.9 crore against Rs 77.3 crore (YoY). Consolidated revenue was up 8.4% at Rs 644.5 crore against Rs 594.5 crore (YoY). Consolidated EBITDA rose 4.7% at Rs 172.8 crore against Rs 165 crore (YoY). Margin at 26.8% against 27.7% (YoY).
Market update at 2 PM: Sensex is up 779.90 points or 1.42% at 55547.52, and the Nifty jumped 221.80 points or 1.36% at 16562.30.
Naveen Kulkarni, Chief Investment Officer, Axis Securities
The Indian markets opened higher on positive global cues, with overnight US markets up more than 2% on the back of strong corporate earnings. Weakness in the dollar index is also helping generate a risk-on environment. Domestically, the move by the Indian government to reduce tax on windfall gains for Oil and Gas companies is helping heavyweights like RIL and ONGC to outperform. We believe that there is a definite reduction in market volatility in the last couple of weeks, but one needs to be wary of risk emanating from Europe, especially with issues relating to the resumption of gas supplies to Europe from Russia and the corresponding effect on growth rates if the gas supply is not restored. We advise investors to gradually increase allocation to equity, especially since FII selling pressure has significantly ebbed in recent times. Some sectors we like are Banks, Auto, and Capital Goods.
NHPC signs MoU with Damoder Valley Corporation to explore formation of JV for hydropower
DoT releases list of final bidders in the upcoming 5G auctions
RBI prepared to spend up to $100 billion more to defend rupee
:India's central bank is prepared to sell a sixth of its foreign exchange reserves to defend the rupee against a rapid depreciation after it plumbed record lows in recent weeks, a senior source aware of the central bank's thinking told Reuters.
Despite the drawdown, the RBI's reserves of $580 billion remain the fifth largest in the world, giving the central bank confidence in its ability to prevent any sharp, jerky depreciation of the currency.
Market update at 1 PM: Sensex is up 830.56 points or 1.52% at 55598.18, and the Nifty jumped 236.20 points or 1.45% at 16576.70.
Newgen Software Q1: Consolidated net profit went down 11.2% at Rs 19.2 crore against Rs 21.6 crore (YoY). Consolidated revenue was up 17.8 % at Rs 188 crore against Rs 159.5 crore (YoY). Consolidated EBITDA slipped 15.3% at Rs 19.3 crore against Rs 22.7 crore (YoY). Margin at 10.2% against 14.2% (YoY).
Nifty FMCG Index gains more than 1 percent, buoyed by strong showing by HUL
Source: NSE
Market at 12.00 Noon
Indices trade positive aided by IT and Metal indices; Nifty around 16,550
Sensex is trading higher by 735.69 points or 1.34 percent at 55,503.3; Nifty is up 212.05 points or 1.30 percent at 16,551.00. Of the 3,345 stocks traded on the BSE, there were 2206 advances, 975 stocks declined while 164 stocks remained unchanged.
Source : BSE
Long build-ups seen in Vedanta, Piramal Enterprises & ONGC
Polycab India hopes to maintain EBITDA margins of 11-13 percent in its cables & wires business
Polycab India expects to maintain 11-13% EBITDA margin in cables & wires business. Company is the fastest growing player in FMEG business with current market share of 5-8% while it has a market share of 24 percent in the organized market, says Inder T Jaisinghani, Chairman & MD of Polycab India. The company is witnessing healthy growth in B2B and B2C Channels and aims to achieve revenues of Rs 20K crore by FY26 with exports contributing 10-12 percent of the total revenues. The working capital days are likely to remain in 50-65 days range and B2C business is likely to grow further from the current levels of 40 percent.
Nifty IT index surges 2.19 percent today
Nifty IT index surges 2.16 percent today led by Tier II IT names Mphasis and L&T Technology Services with each of them gaining more than 3 percent
Source: NSE
Market at 11.00 AM
Indices trade higher aided by IT and Banking stocks; Nifty around 16,550
Sensex is trading higher by 742.21 points or 1.36 percent at 55,512.1; Nifty is up 216.45 points or 1.32 percent at 16,556.95. Of the 3,243 stocks traded on the BSE, there were 2243 advances, 858 stocks declined while 142 stocks remained unchanged
Source : BSE
Buzzing Stock
Shares of Vedanta rose sharply on July 20 after the company announced a hefty second interim dividend on July 19 and as investors were relieved that the government slashed the special additional excise duty imposed on crude oil production.
The company announced an Rs 19.5 per share second interim dividend that will result in a dividend payout of Rs 7,250 crore. The interim dividend comes of the back of an earlier dividend announced by the company that has taken its total dividend payout for 2022-23 so far to close to Rs 19,000 crore.
The large dividend payout is important for Vedanta’s promoter Vedanta Resources that is hurting from a high debt burden at a time when global interest rates have risen sharply. Vedanta’s promoter had aggressively taken on debt from investors in the run up to its now failed delisting offer for the company in 2020.
Besides the second dividend, the stock also got a boost from the government’s announcement of slashing the fixed special excise duty on crude oil production to Rs 17,000 per tonne from Rs 23,250 per tonne effective from July 20.
Yes Bank clarifies on moneycontrol.com report on bank close to raising $1 billion in funding from Carlyle and Advent
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"This is with reference to your email dated July 19, 2022 seeking clarification on the news item appearing in the website “www.moneycontrol.com” dated July 18, 2022 captioned “YES Bank close to raising $1 billion in funding from Carlyle and Advent, deal made on these two terms”. "The Bank would like to clarify that, such news articles reported by media, are speculative and as a matter of policy, the Bank would not like to comment on such speculation. The Bank in the usual and ordinary course of its business continues to explore various means of raising capital/ funds through issuance of securities to diverse set of investors to meet its business/regulatory requirements, subject to compliance with prescribed procedures and receipt of statutory/regulatory approvals," the bank said in an exchange filing.
The metal index added 2 percent led by Vedanta, NALCO, SAIL and Jindal Steel & Power
IndusInd Bank Q1 preview | Net profit seen rising 46% YoY as provisions slide
IndusInd Bank is expected to report strong growth in earnings for the quarter ended June, led by a sharp decline in loan-loss provisions coupled with healthy growth in advances. The Mumbai-based private lender will report its June quarter earnings on July 20.
The bank is likely to expand its net profit by 46 percent year-on-year and 4.6 percent sequentially to Rs 1,423.5 crore in the reported quarter, according to an average of estimates from seven brokerage firms polled by Moneycontrol.
IndusInd Bank is likely to see a 37 percent year-on-year fall in loan-loss provisions during the quarter to Rs 993.7 crore, as asset quality continues to improve aided by lower slippages.
Market update at 10 AM: Sensex is up 639.94 points or 1.17% at 55407.56, and the Nifty jumped 187 points or 1.14% at 16527.50.
Rupee opens
Rupee opens flat at 79.93 per US dollar against July 19 close of 79.94 per US dollar.
Ravindra Rao, VP- Head Commodity Research at Kotak Securities
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COMEX gold trades mixed near $1710/oz as support from weakness in US dollar index, global growth worries and concerns about China’s virus spread is countered by rise in US 10-year bond yield to back above 3%, weaker investor interest as is evident from ETF outflows and concerns about consumer demand in China and India. Gold seems to have stalled near $1700/oz but is still struggling to build on the momentum and price may remain under pressure as general outlook for US dollar still remains strong as Fed is expected to lead other central banks in monetary tightening.
Global brokerages raise target of Hindustan Unilever after Q1 earnings beat estimates
India's largest fast-moving consumer goods (FMCG) company, on July 19 reported a 13.85 percent year-on-year (YoY) rise in consolidated net profit at Rs 2,391 crore for the quarter ended June, which was above analysts' estimate of Rs 2,191.3 crore. Standalone net profit was at Rs 2,289 crore, up 11 percent YoY.
The company's revenue from operations rose 19.46 percent on-year to Rs 14,331 crore for the reported quarter, which was also above analysts' expectations of Rs 13,438.5 crore. The company said the underlying volume growth of 6 percent.
RIL, ONGC jump 2-6 percent each as government eases windfall tax on fuel shipments and crude output, kills gasoline export levy
Market at Open: Sensex is up 600.66 points or 1.10% at 55368.28, and the Nifty added 178.70 points or 1.09% at 16519.20.
V K Vijayakumar, Chief Investment Strategist at Geojit Financial Services
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The sharp 8% pullback in Nifty from the June lows of 15183 is all set to continue aided by a flood of good news. First, the US markets have rebounded sharply driven by impressive corporate earnings. Second, FPI selling appears to have bottomed out. FPIs have bought 5 days this month. The dollar index declining to 106.6 from above 108 is likely to persuade FPIs to buy rather than sell. Third, the relief announced by the government for the petroleum sector through reduction in windfall tax and cuts in duties on exports will be a major boost for the sector, particularly for RIL. However, investors have to exercise some caution because selling may reemerge at higher levels. Results from the leading financials are likely to be good and the ongoing rally may continue. After the recent correction IT valuations are attractive. If the US succeeds in avoiding a recession, IT will bounce back smartly.
Wipro Q1 preview: PAT may dip 7-10% YoY as supply pressure remains, revenue likely to grow 14-18%
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Wipro Limited, one of India’s top four IT services companies, is expected to report subdued earnings on July 20 for the first quarter ended June 2022, as has been the case with rivals TCS and HCL. According to a poll based on the reports from various brokerages, the Azim Premji-owned company is expected to see a dip of 7-10 percent in its consolidated profit after tax (PAT) from the year-ago period, while the growth in consolidated revenue is likely in the region of 14-18 percent year on year.
The growth for the quarter is expected to be soft due to seasonal headwinds and moderation in demand. The Bengaluru-based company is expected to report a consolidated PAT of Rs 2,900–3,000 crore for the quarter, with consolidated revenue in the range of Rs 21,300–21,700 crore.
Market recovery makes investors Rs 21 trillion richer in a month
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The market has staged a smart recovery over the last month, especially after hitting a fresh 52-week low in June, helping investors make Rs 21 trillion wealth in a short period, despite the rupee weakening against the US dollar.
The recovery in global markets, stability and moderation in oil prices (the biggest concern for India as an oil importing country) as well as other commodity prices, and the slowdown in FII selling (they turned net buyers in the last few days) supported market sentiment.
Significant buying in auto, FMCG, capital goods, consumer durables, industrials, oil and gas, realty, and power stocks also lifted momentum. These sectors gained 10-17 percent, followed by banks with a nearly 9 percent return in the last month.
The benchmark indices broke their 52-week low on June 17, 2022. Since then, they have been making a gradual recovery, with a higher high higher low formation, which indicates that most negatives have already been discounted by the market. Even some experts say the market seems unconcerned about inflation now.
Govt discusses proposal to shift to monthly, bi-monthly or weekly fuel price revision: Sources
The government has discussed a proposal to shift to monthly, bi-monthly or weekly fuel price revision, as against the daily review of retail prices undertaken by the oil marketing companies, CNBC TV-18 reported on July 19, citing sources.
The Centre is also reviewing the inclusion of freight cost in the pricing formula for fuel that is refined domestically, the person privy to the developments told the news channel. The inclusion of sea insurance cost in the pricing formula for domestically-refined fuel was also mulled over, the sources added.
Results today:
HUL Q1 net profit rises 14% to Rs 2,391 crore, beats estimate
Hindustan Unilever (HUL), India's largest fast-moving consumer goods (FMCG) company, on July 19 reported a 13.85 percent year-on-year (YoY) rise in consolidated net profit at Rs 2,391 crore for the quarter ended June, which was above analysts' estimate of Rs 2,191.3 crore. Standalone net profit was at Rs 2,289 crore, up 11 percent YoY.
The company's revenue from operations rose 19.46 percent on-year to Rs 14,331 crore for the reported quarter, which was also above analysts' expectations of Rs 13,438.5 crore. The company said the underlying volume growth of 6 percent.
The company said earnings before interest, taxes, depreciation, and amortisation (EBITDA) margin was at 23.2 percent during the quarter, declining 110 basis points YoY. The entire FMCG segment felt intense cost pressure this quarter due to inflation, which has also hit their margins.
Oil falls on inflation concerns, anticipated stock builds
Oil prices fell slightly in early Asian trade on Wednesday, pressured by global central bank efforts to tame inflation and ahead of expected builds in U.S. crude inventories as product demand weakens.
Brent crude prices fell 39 cents or 0.5% to $106.96 a barrel by 0045 GMT, while U.S. West Texas Intermediate (WTI) crude fell 62 cents to $103.60 per barrel. U.S. crude stocks rose by about 1.9 million barrels for the week ended July 15, according to market sources citing American Petroleum Institute figures on Tuesday.
Moneycontrol launches Analysts’ Call Tracker. A monthly special page that tells you which way analysts are leaning; the stock they are most bullish or bearish on, what they are upgrading or downgrades, and where they are betting against the market. Ignore this at your own risk!
Government eases windfall tax on fuel shipments and crude output, kills gasoline export levy
The government has eliminated a levy on gasoline exports, and cut windfall taxes on other fuels less than three weeks after they were imposed. The step offers relief for top fuel exporter Reliance Industries and top crude explorer Oil & Natural Gas Corp.
The Centre reduced the windfall tax on diesel and aviation fuel shipments by Rs 2 per litre and scrapped completely a Rs 6 per litre levy on gasoline exports, according to a government notification. It also cut the tax on domestically produced crude by about 27% to Rs 17,000 a tonne.
