From key Indian benchmark indices’ snapping two-weeks winning streak to important second-quarter results declared by Indian Inc, a lot happened this week. The Indian stock markets started Monday on a bright and shiny note, as the markets traded in green and finally closed Monday at record levels. However, thereafter the benchmark indices embarked on a southward journey, which continued for the rest of the week, thanks to rising global crude oil prices, profit booking, and negative global cues.
After dismal four trading sessions, the Nifty ended the week at 18,114.9, down 1.2% while BSE Sensex closed the week at 60,821.62, down 484.33 points or 0.79%. The Mid-Cap index lost 1,133.05 points and was down 4.24% and closed the week at 25,566.64 level. Stock-wise, among the top gainers were HDFC, Bajaj Auto, ONGC, and banking stocks while Hindalco, Coal India, and Tata Motors turned out to be the biggest losers.
Stocks to watch out:
On the technical side, keep Bank of Baroda, IBR Real Estate and EID Parry on your radar.
Bank of Baroda
CMP: ₹94.60 Tgt ₹100/105 SL ₹85; Duration 1-2 Weeks The counter is witnessing Head & Shoulder Breakout on Monthly chart and symmetrical triangle breakout on weekly time frame. PSU Banks are in momentum. Stock is trading above all its moving averages. ADX indicator is at 41.30 and the leading indicator RSI is also showing further price strength.
IBR Real Estate
CMP: ₹162.80 Tgt ₹185/190 SL ₹142; Duration: 1- 2 Weeks
The counter has witnessed a Rounding bottom formation breakout on October 18 and took meaningful correction from its last high of 186. On a daily time-frame counter is displaying ‘Bullish Harami’ – A bullish reversal candlestick formation which is coinciding its 20 days EMA. A decisive move above 167 will lead the stock to its previous high of 185/190.
CMP: ₹470 Tgt ₹505 /510 SL ₹450
The stock has come out of the consolidation zone of 390-414 on 19 October and brought meaningful correction in the last week. ADX and RSI are showing price strength. The stock is trading above all its averages.
📈 FY22 second quarter results this week
- Reliance Industries reported strong quarterly numbers. The oil-to-telecom conglomerate’s net profit for the July to September quarter surged 43% to ₹13,680 crores, year-on-year, it was up 11% quarter-on-quarter. Its revenue from operations grew 49% to ₹1.74 lakh crore in the second quarter.
- ICICI Bank reports outstanding Q2FY22 numbers with highest ever profits at ₹5,511 crore, up 30% YoY and 19.3% QoQ. The bank reported lowest net NPA since December 2014. Bank’s net interest income (NII), the difference between interest earned and interest expenses, grew 25% to ₹11,690 crore in Q2FY22, with 43bps improvement YoY (11 bps QoQ) in net interest margin at 4%. Its net interest margin (NIM) increased to 4% in the second quarter from 3.89% in the June quarter and 3.57% in last year period.
- JSW Steel records highest-ever consolidated net profit after tax at ₹7,179 crore for the second quarter this fiscal. This is an increase of 350% over last year period’s profit of ₹1,595 crore. The company has also clocked its highest-ever quarterly revenue from operations at ₹32,503 crore compared to ₹19,264 crore in the corresponding period of last year.
- Asian Paints net profit for 2QFY22 was at ₹605 crores, 29% fall from the same quarter last year due to increased expenses. Revenue was up 33% to ₹7,096 crores, YoY. The company’s board also approved an interim dividend of ₹3.65 per share.
- TVS Motor Company reported strong Q2FY22 numbers. Its standalone revenue stood at ₹5,619.4 crores, up 42.8% YoY and 22% QoQ. On the margins front, EBITDA margin was up by 306bps YoY/68bps QoQ to 10%, despite various challenges in terms of increase in commodity costs, scarcity of containers for international business and shortage in semiconductors through significant cost reduction initiatives and growth in revenue.
- Hindustan Unilever (HUL) posted a 9% rise in standalone net profit to ₹2,187 cr. Its revenue from operations rose 11% to ₹12,724 crore as against ₹11,442 crore in the year-ago period. HUL’s domestic consumer business recorded a growth of 11% YoY. The FMCG major declared ₹15 interim dividend.
- UltraTech Cement Ltd.’s Q2FY22 profit fell 22.8% QoQ on higher expenses and lower other income to ₹1,313.5 crore, while it was up 7.6% YoY. Revenue rose 1.6% over the preceding quarter to ₹12,016.8 crore
- Tata Communications reported consolidated profit at ₹425.38 crore in Q2FY22 against ₹384.48 crore in Q2FY21, revenue fell to ₹4,174 crore from ₹4,401 crore YoY.
- Havells India reported QYFY22 consolidated profit drops 7.34% to ₹302.39 crore, while its revenue from operations were up 31.6% to ₹3,238 crore, compared to₹2,459.5 crore last year same quarter. Its total expense shot up 35.6% to ₹2,866.54 crore, up 35.60 per cent YoY. The company declared an interim dividend of 300 per cent, which is ₹3 per equity share of ₹1.
- L&T Finance Holdings reported a 10% decline in its consolidated net profit to ₹223 crore for the quarter ended September 2021. Its total income during July-September 2021 fell to ₹3,134.46 crore as against ₹3,508.91 crore in the year-ago period.
- Yes Bank Q2FY22 profit jumps 74% to ₹225.50, NII declines 23.4% YoY. Advances for the quarter stood at ₹1,72,839 crore, up from ₹1,66,923 crore in Q2FY21, and deposits jumped to ₹1,76,672 crore from ₹1,35,815 crore YoY. Net NPA ratio came in at 5.5% as against 5.8% in the April to June quarter.
- IDBI Bank reported a 75% YoY rise in net profit to ₹567 crore for the quarter ended September 30, 2021.
- PVR net loss narrows to ₹153 crore in Q2FY22 as against a net loss of ₹184.06 in Q2FY21.
- ACC reported a sharply higher standalone profit at ₹449.04 crore in Q2FY22 against ₹363.09 crore in Q2FY21, revenue rose to ₹3,748.90 crore from ₹3,537.31 crore YoY.
- L&T Technology Services reported 39.1% rise in Q2FY22 consolidated net profit to ₹230 crores. Its revenue grew 22.4% to ₹1,607.7 crore during the quarter from ₹1,313.8 crore a year ago. The growth was driven by strong performance in Medical Devices (up 9.6% QoQ) and industrial products (up 8.6% QoQ). Digital revenue grew from 54% of revenue in Q1FY22 to 55% in Q2FY22.
- ICICI Prudential Life Insurance Company net profit for Q2FY22 jumps 47% YoY to ₹444.57 crore. Its net premium income increased 8% to ₹9,286.53 crore from ₹8,572.19 crore YoY. September was the best-ever month in terms of company’s topline (revenue) growth since the inception.
- Nestle India’s net profit for Q3CY21 stood at ₹617.3 crores, against ₹587.09 crore in Q3CY20, up 5%. Its revenues were up 9.6% YoY at ₹3,865. Company’s Board declared a second interim dividend of ₹110 per share.
- TATA Coffee’s Q2FY22 consolidated net profit stood at ₹34.04 crore against ₹23.20 crore in Q2FY21, up 26.55%. Its income growth was slow at 1.4% during the quarter at ₹554.32 crore (YoY).
Among major earnings to be announced this week are Maruti, HDFC AMC, Bajaj Finance, Kotak Bank, Bajaj Auto, SBI Life, Raymond, Titan, Marico, IndusInd Bank, NTPC, GlaxoSmithKline Pharmaceuticals.
📺 Quick bites
- Air passenger traffic within India rose 5.4% in September 2021 to 70.66 lakh passenger when compared to 67 lakh passengers in August and around 79% higher when compared to September 2020.
- According to media reports, China shut down its schools, cancelled hundreds of flights and ramped up mass testings following a new outbreak of COVID-19.
- GAIL (India) announced its plans to build India’s largest green hydrogen-making plant.
- Bharti Airtel’s ₹210 bn rights issue, which was open between 5 October and 21 October 2021, was fully subscribed. The shares were issued at a price of ₹535 per share, including face value of ₹5 per share and a premium of ₹530 per share.
- S&P Global Ratings upgrades ratings of five Tata group companies including Tata Steel, Tata Motors NSE -3.37 % and Jaguar Land Rover (JLR).
- Metropolis Healthcare completed the acquisition of Dr Ganesan’s Hitech Diagnostic Centre (Hitech) along with its subsidiary Centralab Healthcare Services on 22 Oct for a cash consideration of ₹636 crore.
- IPO-bound beauty and consumer-care products ecommerce platform Nykaa has acquired homegrown skincare brand Dot & Key. This is the first D2C (direct to consumer) beauty brand acquired by Nykaa, which is looking to open its IPO issue on October 28.
🚀 IPO Corner
- Nykaa’s IPO to hit the market on 28th October. FSN E-Commerce Ventures, operator of Nykaa beauty stores, has fixed theprice band of ₹1085-1125/share, valuing the company at ₹52,574 crores.
Want to apply for an IPO? Make sure you have a Demat account.
- Paytm gets Sebi approval for biggest Indian IPO in nearly a decade. If Paytm achieves its ₹16,600 crore IPO target, it would surpass Coal India IPO, which raised ₹15,000 crores in 2013.
🔌EV and Sustainability Corner
- Three mutual funds have recently filed applications for electric vehicle funds with SEBI. These are Navi Electric Vehicles and Driving Technology Fund of Fund, Mirae Asset Electric Autonomous Vehicle ETF Fund of Fund and Nippon India S&P EV Index Fund.
- Larsen & Toubro (L&T) announced that it targets to achieve carbon neutrality by 2040 and invest up to ₹5,000 crore to implement and adopt green energy.
- E-mobility arm of Greaves Cotton Ltd, Greaves Electric acquired 100% stake in e-rickshaw brand Bestway Agencies. Last year in July, Greaves had acquired 74 per cent stake in the company. E-rickshaw is one of the largest and fastest-growing categories of electric vehicles in India.
- TVS Motor Company to set up new electric vehicle company afters it received approval from the Board. TVS has already set up an EV-dedicated team with over 500 engineers housed in a separate vertical. TVS has lined up capital expenditure (capex) of ₹750 crore for FY22 which is ₹150 crore more than the ₹600 crore planned earlier.
- Two-wheeler major Honda Motorcycle & Scooter India (HMSI) is all set to launch its first electric product in the country in the next financial year, following similar announcement from Hero MotoCorp. Chennai-based TVS Motor Company had also announced that the company will launch a complete range of electric two and three-wheelers with power output ranging from 5 to 25 kilowatts in the next two years.
- Tata Power has signed an MoU with IIT-Delhi to work together on clean energy and other projects that can be transformed from research and development level to pilot stage.
- From Marico and Tata Steel to Vedanta and RPG, India Inc are understanding the need to focus on their environmental, social and governance (ESG) initiatives, and are in the process of adding ESG as a new parameter in the CEO variable pay as well as making it a part of the key result areas (KRAs) for top management.
- UK eyes big investments in India with electric vehicles. Sustainable solutions company Polymateria has unveiled a new lab that will push for adoption of recyclable plastic tech in the country. British electric mobility company London Electric Vehicle Company (LEVC) has officially announced the brand is entering India. British automaker Mini is also expected to enter the luxury electric vehicle segment in the country with the Electric Cooper.
- Taiwan tech giant Foxconn is looking at making electric vehicles (EVs) in India, Europe and Latin America, including “indirectly” cooperating with German automakers, Chairman Liu Young-way said on Wednesday. Good news for Indian auto-parts makers?
- Delhi is gearing up to become the first city in the country to have the highest number of electric autos running on its roads as registrations for 4,261 such vehicles have been opened up by the Delhi Transport Department on Monday. Under its EV policy, the Delhi government is aiming at adoption of electric three-wheelers, including e-autos, e-rickshaws and e-carts. To support self-employment and wide ownership of e-autos, a Purchase Incentive of ₹30,000 per vehicle shall be provided to the registered owner for the purchase of one e-rickshaw or one e-cart per individual.