GIFT Nifty indicated that Indian equity indices BSE Sensex and NSE Nifty 50 may see a negative opening on Monday. Here’s a look at the key stocks to watch in trade.
Stocks in Focus: GIFT Nifty traded down by 117.50 points or 0.48% at 24,416.50 indicating a negative opening for domestic indices NSE Nifty 50 and BSE Sensex on Monday. Previously, on Friday, the NSE Nifty 50 ended down by 269.95 points or 1.09% to settle at 24,530.90 while the BSE Sensex fell 738.81 points or 0.91% to 80,604.65.
“The progress in the earnings season and the rebalancing of investor portfolios ahead of the union budget have influenced the market this week. Additionally, a global IT outage has caused disruptions in various Indian industries due to issues with computers running on Microsoft. This has impacted the airline services and uncertainty across major economies, banks, and financial services, capping off a turbulent week in the markets,” said Vinod Nair, Head of Research, Geojit Financial Services.
Stocks To Watch: Nykaa, Ambuja Cement, Adani Power, Wipro, Bharti Airtel, Jain Irrigation Stocks To Watch: Zomato, Reliance Industries, L&T, Ola Electric, Cyient DLM, Petronet LNG, Genus Power Stocks To Watch: Hindalco, Godrej Consumer Product, Apollo Tyres, Radico Khaitan, NHPC, Maruti Suzuki, Eicher Motors, LIC Stocks To Watch: Bharti Airtel, ONGC, BEML, Adani Energy Solutions, Bharti Hexacom, Lupin, Shree Cement
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Nair also added that the expectation for Q1FY24 earnings has subdued, the above-expected results from the IT majors provide scope for an upgrade in earnings for FY25. This has attracted more FII inflow to the IT and other defensive large-cap sector Pharma and FMCG spaces. Further, the market direction will be determined by upcoming budget outcomes. Investors are anticipating pro-industry and populist measures with prudence on fiscal. If the budget meets the expectation, it will provide more stability in the market.
Stocks to Watch on July 22, 2024
Reliance Industries
Reliance Industries reported an 11.5% increase in revenue, reaching Rs 2.32 lakh crore from Rs 2.08 lakh crore. EBITDA rose by 1% to Rs 38,765 crore, while net profit decreased by 5.5% year-on-year to Rs 15,138 crore. The EBITDA margin declined to 16.7% from 18.4% last year. Reliance Jio’s Average Revenue per User (ARPU) increased slightly to Rs 181.7 from Rs 180.5.
Reliance Retail saw an 8.1% rise in revenue to Rs 75,630 crore, with the retail EBITDA margin improving to 7.5% from 7.4%. The Oil-to-Chemicals (O2C) segment’s revenue grew to Rs 1.57 lakh crore from Rs 1.33 lakh crore, though its margin dropped to 8.3% from 11.5%. The Oil and Gas segment’s revenue increased to Rs 6,179 crore from Rs 4,632 crore, with the margin slightly down to 84.3% from 86.7%.
HDFC Bank
HDFC Bank reported a Net Interest Income of Rs 29,837.1 crore, exceeding the poll estimate of Rs 29,583 crore, and a net profit of Rs 16,174 crore, surpassing the Rs 15,693.1 crore estimate. Net Interest Income grew 2.6% quarter-on-quarter. Gross NPA increased to 1.33% from 1.24% in March, and Net NPA rose to 0.39% from 0.33%. Provisions fell 80.7% sequentially to Rs 2,602 crore.
Return on Assets decreased to 1.88% from 1.96% quarter-on-quarter, with most asset quality issues stemming from the agri segment. The board gave in-principle approval to list its subsidiary HDB Financial Services as per RBI norms, with the bank seeking necessary regulatory approvals.
Wipro
In constant currency terms, revenue declined by 1%, marking the sixth consecutive quarterly revenue drop. The EBIT margin remained stable at 16.5%. For Q2, revenue growth is projected to range between -1% to +1% in constant currency terms.
Overall Total Contract Value (TCV) decreased by 9% sequentially to $3.28 billion, with large deal TCV falling 3% sequentially to $1.15 billion. The company’s ADR ended 11.5% lower on Wall Street.
Kotak Mahindra Bank
The bank reported a Net Interest Income of Rs 6,842 crore, falling short of the expected Rs 7,067 crore, while net profit exceeded expectations at Rs 6,249 crore against the projected Rs 4,004 crore. The Net Interest Margin dropped to 5.02%, the lowest in eight quarters.
Deposits grew 15.8% year-on-year, the lowest increase in six quarters, whereas advances rose 18.7%, marking the best growth in six quarters. Provisions doubled sequentially to Rs 578.5 crore. Profit was bolstered by an exceptional item of Rs 3,519.9 crore. Gross NPA remained flat at 1.39%, and Net NPA stood at 0.35%.
JSW Steel
The company reported a revenue of Rs 42,943 crore, exceeding the poll estimate of Rs 41,276 crore, but slightly missed the margin expectation with 12.83% against the projected 13.76%. Standalone Indian EBITDA per tonne stood at Rs 8,339, slightly above the poll estimate of Rs 8,116. Indian operations had a capacity utilisation of 87%. Net sales realisations fell 5% due to lower domestic steel prices but increased 1% sequentially due to a better product mix.
The US business experienced a significant reduction in EBITDA both sequentially and year-on-year due to a steep decline in steel prices and NRV losses. The board approved the transfer of a 30 MTPA slurry pipeline undertaking in Odisha to JSW Infra. For FY25, the company projected production at 28.4 MT and sales at 27 MT.
Yes Bank
The bank’s Net Interest Income rose 12.2% year-on-year to Rs 2,244 crore, while net profit surged 46.7% year-on-year to Rs 502.4 crore. Provisions decreased by 55% quarter-on-quarter. Gross NPA remained flat at 1.7%, and Net NPA improved to 0.5% from 0.6% in March. The bank stated this is the highest quarterly profit since its reconstruction.
RBL Bank
The bank’s net profit increased by 29% to Rs 371.5 crore, and Net Interest Income rose 19.5% to Rs 1,700 crore. Gross NPA slightly increased to 2.69% from 2.65%, while Net NPA remained flat at 0.74%. Slippages rose 5.9% to Rs 720 crore. Net Interest Margin (NIM) reached an all-time high of 5.67%, and Return on Assets (RoA) hit a 20-quarter high of 1.14%.
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Management noted there is no immediate need to raise capital but highlighted incremental stress in the credit card portfolio and some disturbances in collection efficiency in certain states during two months of the quarter. The Credit Cards business experienced a net slippage of Rs 400 crore during the quarter.
Patanjali Foods
Patanjali Foods reported a 199.6% increase in profit for Q1 FY25, reaching Rs 262.9 crore compared to Rs 87.8 crore in the same quarter last year. However, revenue fell by 7.6% to Rs 7,173 crore from Rs 7,767.1 crore.
Indian Hotels
Revenue increased by 5.7% to Rs 1,550.2 crore, and EBITDA rose 9.6% to Rs 449.6 crore, with the EBITDA margin improving to 29% from 28% last year. Net profit climbed 11.7% to Rs 248.4 crore.
Despite a seasonally weak quarter due to elections and heatwaves, as well as a 25% drop in wedding revenue due to fewer dates, room revenue grew by 7% to Rs 776 crore and F&B revenue increased by 2% to Rs 534 crore. GINGER’s revenue share rose to 12% from 8% last year.
IRCTC
The Government of India has announced the upgradation of the Indian Railway Catering and Tourism Corporation (IRCTC) from a ‘Schedule B’ to a ‘Schedule A’ category Central Public Sector Enterprise (CPSE).
Vedanta
The company successfully closed its Qualified Institutions Placement (QIP) issue, raising Rs 8,500 crore by selling 19.31 crore equity shares at Rs 440 per share. Prominent institutional investors, including Morgan Stanley, Societe Generale, SBI Mutual Fund, Nippon Mutual Fund, ICICI Mutual Fund, and Copthall Mauritius Investment, participated in the offering.
ONGC
ONGC Videsh has signed a definitive Sale Purchase Agreement (SPA) to acquire a 0.615% participating interest in the offshore Azeri Chirag Gunashli (ACG) oil field in Azerbaijan from Equinor. Additionally, through its subsidiary ONGC BTC, it will acquire a 0.737% stake in the Baku Tbilisi Ceyhan (BTC) pipeline company. The acquisitions, totaling up to USD 60 million, are expected to be completed in the coming months.
JSW Infra
India’s second-largest private commercial port operator has acquired the Under Development Slurry Pipeline Project from JSW Utkal Steel, a wholly-owned subsidiary of JSW Steel, for Rs 1,700 crore. The acquisition includes a 20-year long-term take-or-pay agreement to transport iron ore through the pipeline.
HDFC Life Insurance
The Assistant Commissioner of Income Tax, Mumbai, has issued an income tax rectification order, reducing the tax and interest demand for the Assessment Year 2020-21 from Rs 4,178.8 crore to Rs 1,868.12 crore.
Jubilant Pharmova
Following an audit in April 2024, the US Food and Drug Administration (US FDA) has classified Jubilant Draximage Inc’s radiopharmaceutical manufacturing facility in Montreal, Canada, as Voluntary Action Indicated.
KPI Green
KPI Green has received a Letter of Award (LOA) from MAHAGENCO for the development of a 100 MWAC Solar Power Project. This award includes an EPC package with land and three years of Operation and Maintenance (O&M). The project is part of a tender for the development of a cumulative capacity of 600 MWAC Solar-PV Power Projects at various locations in Maharashtra under the RE Bundling Scheme.
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