Ajit Mishra, VP - Research, Religare Broking:
Markets traded volatile and lost over a percent, following weak global cues. After the gap down start, the benchmark inched lower in the first half however healthy buying in the banking space pared the losses significantly. However, continued pressure in the IT majors and a few other index majors capped the upside. Consequently, Nifty closed at 17,110; down by 1%. The broader indices performed in line and lost in the range of 0.7%-1.2%.
Excessive volatility on the global front is keeping our markets also on the edge. With the US FOMC meet behind us, we expect some stability now. However, the prevailing earnings season and upcoming Union budget would keep the participants on their toes.
The recent buoyancy in the banking space is certainly encouraging but the other sectors should also support for any meaningful recovery. We feel it’s prudent to stay light and let the markets stabilise.
Gaurav Ratnaparkhi, Head of Technical Research, Sharekhan by BNP Paribas:
The Nifty opened gap down on January 27 & went down to test the near term support parameters. It came down to test the junction of the swing low, the 78.6% retracement of the Dec – Jan rally & the hourly lower Bollinger Band. Over there the bulls rushed in to provide support to the benchmark index. As a result, the bulls managed to defend the swing low of 16836.
Thereon the index witnessed decent recovery towards the end of the session. Consequently, the Nifty held on to the psychological mark of 17000 on a closing basis for yet another session.
The overall structure shows that the index is preparing for a short term bounce towards 17500-17600. On the flip side, 17000 will continue to act as a near term support on a closing basis with major support at 16825.
Rupak De, Senior Technical Analyst at LKP Securities:
Volatility has been predominant during the day as the benchmark Nifty traded in the range of 300 points. On the lower end Nifty held the recent low of 16836 which it made in early trades of Tuesday. So Nifty has respected the support of 16825.
Going forward the market may remain volatile. On the lower end support is visible at 16825-16800. A decisive fall below 16800 may trigger resumption of the corrective phase. However, if Nifty may remain in the recovery mode as long as 16800 is held.
Rahul Sharma, Co-owner, Equity 99:
Markets continued its downward journey, as Fed is likely to hike the interest rates in March. The market was majorly in negative zone due to Fed news. We expect buying in the market, as we are expecting a positive budget. The volatility may continue, but one should hold on their positions and not sell in panic.
For Nifty50 17060 will act as very strong support level. If this level is breached intraday than the next support will be around 16990 levels, post which markets might take support at 16880 levels.
On upper side 17185 will act as strong hurdle rate, if this level is breached than next resistance will be around 17250 levels post which we might see 17300 levels.
S Ranganathan, Head of Research at LKP securities:
As the FED left key interest rates near zero, its hawkish commentary quickly washed away gains in Global Markets leading to a gap down opening in indices back home.
As FPI continued to book profits from Indian equities, value stocks made a comeback with the PSU Bank index rallying over 5% in afternoon trade today well supported by auto stocks to stage a smart recovery. As IT & pharma stocks witnessed profit taking, textile stocks were sought after in the broader market on the back of earnings.
Market Close:
Benchmark indices ended lower with Nifty below 17,200 in the highly volatile session on January 27 after Federal Reserve in its policy outcome indicated interest rates hike in the near future.
At close, the Sensex was down 581.21 points or 1% at 57,276.94, and the Nifty down 167.80 points or 0.97% at 17,110.20. About 1447 shares have advanced, 1832 shares declined, and 90 shares are unchanged.
HCL Technologies, Tech Mahindra, Dr Reddy’s Laboratories, TCS and Wipro were the top Nifty losers, while gainers included Axis Bank, SBI, Maruti Suzuki, Cipla and Kotak Mahindra Bank.
Among sectors, PSU bank index was up 5 percent, while auto and bank indices rose 0.3-1percent. However, FMCG, realty, pharma, and IT indices shed 1-3 percent. BSE midcap and smallcap indices fell 0.8-1.2percent.
Laurus Labs Q3 earnings:
Laurus Labs has reported 43.2 percent fall in its Q3 net profit at Rs 155 crore against Rs 273 crore and revenue was down 20.1% at Rs 1,028.8 crore versus Rs 1,288.4 crore, YoY.
Laurus Labs was quoting at Rs 460.40, down Rs 14.25, or 3 percent on the BSE.
Wockhardt Q3 rsults
Wockhardt has posted net loss at Rs 6.8 crore in the quarter ended December 2021 against profit of Rs 15.2 crore in a year ago period.
Revenue of the company was up 11.8% at Rs 854 crore versus Rs 764 crore, YoY.
Wockhardt touched a 52-week low of Rs 379.80 and was quoting at Rs 394.45, down Rs 1.45, or 0.37 percent.
Mohit Ralhan, Managing Partner & Chief Investment Officer of TIW Private Equity:
The US Fed has very clearly indicated that the situation of inflation has been deteriorating and the policy decisions will reflect the same. Market participants almost unanimously agree that there would be a rate hike in March, but it remains uncertain whether the rate hike will be 25 bps or more.
Given that the US inflation rate reached 7% in December, which is way above the Fed’s target of 2%, the logical inclination is to expect a hike of at least 50 bps, but the Fed may also want to keep it gradual.
While, in the December meeting Fed has signalled a forecast of three policy rate hikes, but the rising inflation has convinced market participants that there would most likely be four rate hikes. Fed didn’t rule out the same and the decline in the market indicates that a large section of market participants who were still considering three policy hikes in their calculations have now moved beyond it and joined the four rate hikes bandwagon.
The emerging markets will feel the pressure as liquidity gets eroded. FII’s have been net sellers in the Indian market and the US Fed’s increasingly hawkish stance is expected to continue putting selling pressure in Indian markets. This is liquidity-driven an un-correlated to domestic factors of economic recovery and growth. Therefore, the impact is expected to act as a stabilizing event and the long-term bull-run in India is likely to continue based on local macroeconomic factors.
Nifty FMCG index shed 1 percent dragged by the United Spirits, United Breweries, Radico Khaitan
Sameer Kaul – MD & CEO, TrustPlutus Wealth:
The fall in the Indian markets is in line with global markets. The markets were eagerly awaiting the outcome of the US Federal Reserve meeting on Monetary Policy which was held on 25th and 26thJanuary, 2022. The Federal Reserve has indicated that they will begin hiking interest rates in the near future and that there will be multiple rate hikes this year.
Along with that the Fed has also stated that they will end the asset purchase program in March and will also look to reduce the size of the Fed Balance Sheet from sometime later this year. The combination of these measures is what has spooked markets globally as it would mean moving from a scenario of easy and excess liquidity to a scenario of liquidity tightening.
As stated earlier, we expect 2022 to be a much more challenging year from a returns perspective as compared to 2021. We suggest investors stick to their asset allocation and invest in high quality companies and also pay close attention to valuations.
Market at 3 PM
Benchmark indices erased most of the intraday gains but still trading lower with Nifty around 17100.
The Sensex was down 623.23 points or 1.08% at 57234.92, and the Nifty was down 180.20 points or 1.04% at 17097.80. About 1349 shares have advanced, 1791 shares declined, and 85 shares are unchanged.
KRChoksey on Axis Bank
The Q3FY22 earnings for Axis Bank were strong from all financial metrics. Asset quality improved for Q3FY22 led by moderation in slippages and strong recoveries/accounts upgrades, whereas the operating profits remained flat due to higher operating expenses. Provision coverage remained steady at 72%.
In the long run, we expect Axis Bank to benefit on the back of its expansion of branches, strengthening the loan book mix with improving contribution from the retail segment, gaining market share, and lowering credit costs.
We expect the asset quality to improve further with the moderation of the slippages in Q4FY22E as well. The improvement of the financial parameters will lead to improvement in its returns ratio as targeted by the bank.
We have factored in CAGR 14% in advances, 14.7% in NII, 12.9% in PPOP, and 45.1% in PAT driven by healthy financial metrics on all fronts over FY21-24E.
We maintain our target price of Rs 936 per share, applying 2x FY24E P/ABV with an adjusted book value of Rs 475. This implies an upside of 24.4% over the CMP. We maintain our rating on the share of Axis Bank at buy.
Total marketcap lost around Rs 22 trillion since January 18
European Markets Updates
La Opala Glass Q3
Net profit was up 28.3% at Rs 32.5 crore against Rs 25.3 crore (YoY). Revenue jumped 38.5% at Rs 108.6 crore against Rs 78.4 crore (YoY). EBITDA was up 43.8% at Rs 44.9 crore against Rs 31.2 crore (YoY). EBITDA margin at 41.3% against 39.8% (YoY).
Adani Wilmar IPO updates:
The initial public offering (IPO) of Adani Wilmar, a joint venture between Adani Group and Singapore-based Wilmar, received bids for 4.35 crore equity shares against IPO size of 12.25 crore equity shares, subscribing 36 percent on January 27, the first day of bidding.
The portion set aside for retail investors was subscribed 74 percent, while the portion allocated for non-institutional investors was subscribed of 16.62 lakh shares of the 2.15 crore shares allocated. Qualified institutional buyers (QIB) have subscribed 11 percent or 32.63 lakh share out of the 2.87 crore share allotted to them.
Airtel Payments Bank customers' deposit surges 75% to Rs 1,000 crore in 2021
Money deposited with Airtel Payments Bank surged 75 percent to Rs 1,000 crore in 2021 as compared to the previous year, a top company official said. The payments bank had recorded around Rs 570 crore worth of deposits in 2020.
Airtel Payments Bank MD and CEO Anubrata Biswas told PTI that the company added close to 35 lakh customers during the year and crossed the 10-crore customer mark in 2021.
''The growth in deposits is an endorsement of the trust that customers have placed with us. With our strong distribution and digital banking platform, the bank offers a market-leading proposition to both the urban digital and the retail customers,'' Biswas said.
Mold-Tek Packaging Q3
: Net profit was up 11.6% at Rs 16.6 crore against Rs 14.9 crore (YoY). Revenue jumped 20.1% at Rs 160.3 crore against Rs 133.5 crore (YoY). EBITDA rose 14.2% at Rs 31.6 crore against Rs 27.6 crore (YoY). Margin at 19.7% against 20.7% (YoY).
Colgate Palmolive Q3
Net profit was up 1.6% at Rs 252.3 crore against Rs 248.3 crore (YoY). Revenue rose 3.9% at Rs 1,280 crore against Rs 1,232 crore (YoY). EBITDA was up 2.6% at Rs 380.4 crore against Rs 370.7 crore (YoY). Margin at 29.7% against 30.1% (YoY).
Market update at 2 PM: Sensex is down 687.32 points or 1.19% at 57170.83, and the Nifty down 194.20 points or 1.12% at 17083.80.
Motilal Oswal on Indiamart Intermesh
Strong collections are testimony to the recovery in demand momentum. We anticipate the collections momentum to remain intact in the near term.
We are confident of the strong fundamental growth in operations, propelled by: a) higher growth in digitization among SMEs (~25%), b) the need for out-of-the-circle buyers, c) a strong network effect, d) over 70% market share in the underlying industry, e) the ability to improve ARPU on low price sensitivity, and f) high operating leverage.
We have arrived at our DCF-based target price of Rs 7,650 per share, assuming 11.5% WACC (up from 11% earlier) and 6% terminal growth rate. Our target price implies a 53% potential upside from the current level. Reiterate buy.
Nifty PSU Bank index rose nearly 4 percent supported by the Union Bank of India, Canara Bank, Indian Bank
Axis Bank share price rises for second day on better Q3 numbers
Axis Bank share price rose for the second day after the private lender announced better numbers for the quarter ended December 2021.
Axis Bank was quoting at Rs 759.40, up Rs 7.45, or 0.99 percent, and added 1.4 percent intraday.
In the previous session, the share closed up 6.76 percent, or Rs 47.60, at Rs 751.95 after Axis Bank reported a 224 percent year-on-year rise in its net profit at Rs 3,614 crore for the quarter ended December on January 24.
The private sector bank also reported a 17 percent on-year growth in net interest income to Rs 8,653 crore for the quarter ended December.
The lender had a strong performance on the asset quality front as gross non-performing ratio slipped 36 basis points sequentially to 3.17 percent. Similarly, net NPA ratio also fell 17 basis points on-quarter to 0.91 percent.
Buzzing:
Torrent Pharmaceuticals share price tumbled over 15 percent on January 27, a day after the company reported a 16 percent drop in profit for the December quarter.
Torrent Pharmaceuticals on Tuesday said its consolidated net profit declined to Rs 249 crore for the third quarter ended December 2021 on account of muted performance in the US market. The drug maker had posted a net profit of Rs 297 crore in the October-December period of 2020-21 fiscal.
The company’s revenue from operations in the third quarter stood at Rs 2,108 crore as against Rs 1,995 crore a year back, Torrent Pharmaceuticals said in a statement.
The company said its US revenues during the period under review stood at Rs 235 crore, a year-on-year drop of 20 per cent.
Adani Wilmar IPO Update
The initial public offering (IPO) of Adani Wilmar, a joint venture between Adani Group and Singapore-based Wilmar, received bids for 3.38 crore equity shares against IPO size of 12.25 crore equity shares, subscribing 27 percent on January 27, the first day of bidding.
This is the second IPO of 2022, after AGS Transact Technologies.
The portion set aside for retail investors was subscribed 57 percent, while the portion allocated for non-institutional investors was subscribed of 10.67 lakh shares of the 2.15 crore shares allocated.
Qualified institutional buyers (QIB) have subscribed 11 percent or 32.63 lakh share out of the 2.87 crore share allotted to them .
Canara Bank Q3 results:
Canara Bank has reported net profit of Rs 1,502 crore in the quarter ended December 2021 versus Rs 696.1 crore in the same quarter last fiscal.
The net interest income was up 14.1 percent at Rs 6,945 crore versus Rs 6,086.5 crore, YoY.
Gross NPA was at 7.80 percent versus 8.42 percent and net NPA at 2.86 percent versus 3.21 percent, QoQ.
Canara Bank was quoting at Rs 234.65, up Rs 13.35, or 6.03 percent on the BSE.
Future Enterprises to sell 25% stake in General Insurance JV, Future Generali
Future Enterprises has today agreed to sell a 25% stake in its General Insurance Joint Venture, Future Generali India Insurance Company Limited (FGIICL) to its Joint Venture partner, Generali Participations Netherlands N. V.(Generali) for a cash consideration of Rs 1252.96 crore, plus an additional consideration that is linked to the date of the closing of the transaction.
Future Enterprises was quoting at Rs 9.76, up Rs 0.05, or 0.51 percent on the BSE.
Market at 1 PM
Benchmark indices were trading lower with Sensex down 1000 points and Nifty below 17000.
The Sensex was down 1,084.61 points or 1.87% at 56773.54, and the Nifty was down 315 points or 1.82% at 16963. About 1041 shares have advanced, 2059 shares declined, and 90 shares are unchanged.
BSE Midcap index fell 2 percent dragged by the Torrent Pharmaceuticals, Jubilant FoodWorks, ABB India
Amit Pabari, MD at CR Forex Advisors
The recent Fed meeting was no surprise to the market as such, but participants got further solid confirmation that the Fed is on the course of a rate hike in March and that will be followed by a Quantitative Tightening (Selling of bond or Balance sheet reduction) in upcoming meetings.
Post announcement of the policy decision and conference, all 3 major US indices reversed their gains and closed in Red. The bond market fell and yield shot up sharply. The policy-sensitive short-term rates jumped to a 23-month high as U.S. 2-year yield jumped to 1.17%. And 10 years to 1.85%, making a yield curve further on a flattening scale to 68 bps.
The US dollar index tested a one-month high above 96.50. Asian markets are trading with a loss of more than 1.5% and currencies are down by 0.30% to 0.50%. In the NDF market, the Indian rupee was seen quoting near 75.10 and that is likely to be open for the onshore interbank market too. Today, the pair is expected to trade in the wide range of 74.85 to 75.35 with an upside bias.
Elara Capital on Cipla
The US sales run-rate is improving while performance across segments in India is robust. We retain our EPS estimates for FY22 and trim our FY23E EPS by 4% due to higher R&D investment.
We expect a revenue CAGR of 13%, an EBITDA CAGR of 18% and a PAT CAGR of 24% over FY21-24E. Given earnings sustainability, better visibility in the US and robust free cashflow generation, we reiterate buy with a target price of Rs 1,135 on 20x (unchanged) FY24E P/E, including Rs 30 for gRevlimid NPV.
Shrikant Chouhan, Head of Equity Research (Retail), Kotak Securities:
Markets are down mainly on the Hawkish Fed Outlook. Mr Powell, chairman of the Federal Reserve, signalled a rise in interest rates in March and predicted the possibility of an unexpectedly aggressive policy tightening.
This has led to an increase in the 10-year bond yields of the US and the dollar index, which is negative for emerging markets.
Tensions between Russia and Ukraine have pushed up crude oil prices. With all these headwinds, the market today is facing a monthly expiration date for January FNO contracts, which has added to the volatility.
Larsen & Toubro Infotech partners with IIT Madras to innovate in 5G Space
Larsen & Toubro Infotech is partnering with IIT Madras for collaborative research in the field of 5G. Through this collaboration, LTI and IIT Madras aim to innovate in the emerging 5G space and enable 5G frameworks validation, low frequency RF deployments and use case testing with 5G test bed, company said in its press release.
Larsen & Toubro Infotech was quoting at Rs 5,795.75, down Rs 237.70, or 3.94 percent on the BSE.
Market at 12 PM
Benchmark indices extended the losses and trading at day's low dragged by IT, pharma and realty names.
The Sensex was down 1,251.21 points or 2.16% at 56606.94, and the Nifty was down 364.00 points or 2.11% at 16914. About 1084 shares have advanced, 1984 shares declined, and 103 shares are unchanged.
BSE Realty Index down 3 percent dragged by the Indiabulls Real Estate, Godrej Properties, DLF
Sun Pharma launches CEQUA in Canada:
Sun Pharma Canada Inc., a wholly owned subsidiary of Sun Pharmaceutical Industries today announced the launch of CEQUA, a new treatment for Canadians living with dry eye disease, company said in its release.
CEQUA (cyclosporine ophthalmic solution 0.09% w/v), a calcineurin inhibitor immunomodulator, is the first dry eye treatment available in Canada that is delivered with nanomicellar (NCELL) technology, which improves the bioavailability and physicochemical stability of cyclosporine to increase ocular tissue penetration, it added.
Sun Pharmaceutical Industries was quoting at Rs 799.60, down Rs 7.40, or 0.92 percent on the BSE.
Adani Wilmar IPO updates
The initial public offering (IPO) of Adani Wilmar, a joint venture between Adani Group and Singapore-based Wilmar, received bids for 2.66 crore equity shares against IPO size of 12.25 crore equity shares, subscribing 22 percent on January 27, the first day of bidding.
The portion set aside for retail investors was subscribed 43 percent, while the portion allocated for non-institutional investors was subscribed of 9.29 lakh shares of the 2.15 crore shares allocated. Qualified institutional buyers (QIB) have subscribed 11 percent or 32.63 lakh share out of the 2.87 crore share allotted to them.
BCL Industries share price rises as production to start at new ethanol plant
Shares of BCL Industries share price rose after the company said that commercial production at the new ethanol plant of its subsidiary is expected to start before the end of the current financial year.
In an update to the stock exchanges, the company said that the initial plant testing at the new 200 kiloliters per day ethanol plant of its subsidiary Svaksha Distillery has begun. “The subsidiary of the company has also obtained in-principal approval from MoEF for enhancing the capacity by another 100 kiloliters per day at the same premises,” BCL Industries said.
Mahindra & Mahindra enters e-Cart segment, launches e Alfa Cargo:
Mahindra Electric Mobility Ltd, part of the Mahindra Group announced the launch of its new electric 3-wheeler, the e Alfa Cargo priced at Rs 1.44 lakh. The launch of the e Alfa Cargo marks the entry of Mahindra in the rapidly growing e-cart segment. The stock was trading at Rs 851.00, down Rs 3.00, or 0.35 percent. It has touched an intraday high of Rs 853.90 and an intraday low of Rs 841.05.
Tata Sons Chairman N Chandrasekaran meets PM Modi today ahead of Air India handover
Tata Sons chairman N Chandrasekaran will be meeting Prime Minister Narendra Modi on January 27 ahead of the likely handover of the flag carrier Air India to the business conglomerate, CNBC-TV18 has said.
A new board will be constituted after that of Air India resigns during the day, the report said. Tata is also in talks to appoint an ex-pat from the global aviation industry as Air India CEO. The merger of Air India Express and Air Asia India is set to commence next week, the report added.
Wipro appoints Badrinath Srinivasan as Southeast Asia MD
IT major Wipro on Thursday said it has appointed Badrinath Srinivasan as Managing Director for Southeast Asia. Srinivasan will focus on Wipro’s vision for business growth, revenue expansion, client and influencer relationships, talent development and brand building, a statement said.
Southeast Asia has been a strategic focus for Wipro over the years and even more so now, with the region’s growing demand for comprehensive digital transformation solutions, agility and scale, specialised technology requirements and innovation, Wipro CEO (APMEA) NS Bala said.
The stock was trading at Rs 545.65, down Rs 17.20, or 3.06 percent. It has touched an intraday high of Rs 558.00 and an intraday low of Rs 542.50.
Market update at 11 AM: Sensex is down 1,099.28 points or 1.90% at 56758.87, and the Nifty tumbled 323.20 points or 1.87% at 16954.80.
Adani Wilmar IPO updates
The initial public offering (IPO) of Adani Wilmar, a joint venture between Adani Group and Singapore-based Wilmar, received bids for 1.42 crore equity shares against IPO size of 12.25 crore equity shares, subscribing 12 percent on January 27, the first day of bidding.
The portion set aside for retail investors was subscribed 26 percent, while the portion allocated for non-institutional investors was subscribed of 8.15 lakh shares of the 2.15 crore shares allocated.
Crash in new-age tech IPO stocks sours sentiment in unlisted market
The meltdown seen in stocks of some of the biggest initial public offerings of last year seems to be driving investors away from the unlisted space as well. Dealers pointed to a sharp decline in trade volumes and investor interest in companies close to going public.
“As the broader market is giving up the gains before the Union Budget, the unlisted markets too have failed to recover from the recent lows. One rarely sees a rapid fall in unlisted markets as most participants are long-term investors. Hence, if the broader market extends the losses, we may see a rub-off effect in unlisted space but at a slower pace,” said Manan Doshi, Co-Founder of unlistedarena.com.
The sentiment in the unlisted space turned after the disastrous debut of One97 Communications, parent of Paytm, on the bourses in November that saw the stock plunge 27 percent from the issue price. Paytm has lost nearly 51 percent since listing, eroding over Rs 70,000 crore of its market value.
Bharat Electronics signs $73 million contract with Hyperion Global Group
Navratna Defence PSU BharatElectronics Limited (BEL) and Hyperion Global Group, LLC, an infrastructure telecommunication distribution company based in the USA, have entered into a contract to develop, manufacture and supply Internet of Things (IoT) devices for the US market.
As per the contract signed on January 21, 2022, BEL will manufacture and supply IoT devices worth US $73 Million to Hyperion during the first year of commencement of supply with a provision to negotiate and supply upgrades of the products, worth $365 million, in the next five years, the company said in an exchange filing. The stock was trading at Rs 201.90, down Rs 2.35, or 1.15 percent. It has touched an intraday high of Rs 203.00 and an intraday low of Rs 198.10.
Adani Wilmar IPO updates
The initial public offering of Adani Wilmar, a joint venture between Adani Group and Singapore-based Wilmar, has received bids for 47.74 equity shares against IPO size of 12.25 crore equity shares, subscribing 4percent on January 27, the first day of bidding.
This is the second public issue opening in the year 2022, after AGS Transact Technologies. The portion set aside for retail investors was subscribed 9 percent, while the portion allocated for non institutional investors was subscribed 2 percent.
Rupee Opens:
Indian rupee opened 41 paise lower at 75.18 per dollar on Thursday against Tuesday's close of 74.77.
The US dollar surged 0.56% on Wednesday amid hawkish statement from US Fed and on improved economic data from the US. The US Fed said it is likely to increase interest rates and plans to end its QE programme in March, said ICICI Direct.
Rupee future maturing on January 27 depreciated by 0.23% on the back of stronger dollar index and higher FII outflows. However, further downsides were prevented as risk appetite in the domestic markets increased, it added.
