Share Market Highlights 13 November 2023: Sensex drops 325 points; Nifty ends below 19,450; CIL jumps over 5%

Benchmark stock indices Sensex and Nifty declined on Monday due to selling pressure in IT, consumer durables and financial stocks as investors turned cautious ahead of the release of inflation data.

Giving up Diwali day gains, the BSE Sensex fell 325.58 points or 0.50 per cent to settle at 64,933.87. During the day, it dropped 406.09 points or 0.62 per cent to 64,853.36.

The Nifty declined 82 points or 0.42 per cent to 19,443.55.

Biocon Biologics Limited (BBL), a subsidiary of Biocon Ltd., has announced that MHRA, Medicines and Healthcare products Regulatory Agency in the UK, has granted marketing authorisation for YESAFILI, a biosimilar of Aflibercept.

The rupee consolidated in a narrow range and settled lower by 4 paise at 83.32 (provisional) against the US dollar on Monday, tracking a negative trend in domestic equities.

Persistent foreign fund outflows also weighed on the local unit, forex traders said.

At the interbank foreign exchange market, the rupee opened at 83.31 and touched a low of 83.33 against the greenback.

D S Kulkarni Developers reported its standalone net profit for the quarter ended September 2023 at ₹545.05 lakh as against ₹54.76 lakh in same quarter previous year.

Rajnish Wellness Limited has announced opening of new medical stores, Dava Discount, franchisee at 5 various locations viz Maharashtra, Assam, Karnataka, West Bengal and Chhattisgarh. The stock trades at ₹11.49 on the BSE, up by 1.77%.

Manappuram Finance reported a standalone net profit for the quarter ended September 2023 at ₹419.91 crore as against ₹348.91 crore in the same quarter of the previous year. The stock trades at ₹138.25 on the NSE, down by 0.07%. The board has declared an interim dividend of ₹0.85 per equity share.

Indo Borax & Chemicals has received Consent-to-Operate (CTO) permission from the Madhya Pradesh State Pollution Control Board for its new value-added Boric Acid Derivative, Agricultural Chemical Di Sodium Octaborate Tetrahydrate (DOT) plant. The stock trades at ₹151.95 on the BSE, up by 0.56%.

Major gainers:

Coal India (5.12%); Eicher Motors ;(1.91%); Hindalco (1.06%); M&M (0.77%); NTPC (0.72%)

Major losers:

SBI Life (-2.37%); Bajaj Finance (-1.34%); HDFC Life (-1.18%); Infosys (-1.11%); Apollo Hospitals (-1.04%)

A total of 1,705 stocks advanced on the BSE at 3 pm on November 13, 2023, against 2,093 stocks that declined; 144 stocks remained unchanged. The total stocks traded were 3,942. While 325 stocks recorded a 52-week high, 19 hit a 52-week low.

Sriram BKR, Senior Investment Strategist at Geojit Financial Services: Samvat 2080 Muhurat day (12-Nov-23), saw trades across 2,431 cos, a new high, with more new listings over the years.

Muhurat day registered a turnover of Rs 14,091.3 crore, an all-time high, up 34.7% YoY, after a dip in 2022.

Muhurat Day closed positive for the sixth year in a row.

80% of securities advanced during the day, 16% declined and 3% remained unchanged. The advances /decline ratio stood at 4.90. It stayed above 3, for the sixth straight year.

Keystone Realtors has entered into a sale agreement with Haren Textiles Private Ltd and Harit Synthetic Fabrics Private Ltd for acquisition of land admeasuring approximately 16,152.29 square meters situated at Dahisar (East), Mumbai. The stock trades at ₹559 on the BSE, up by 0.83%.

Union Bank (6.70%); Indian Bank (6.53%); Bank of Maharashtra (6.11%); Central Bank (6.08%); UCO Bank (5.73%)

Total Transport Systems reported a net profit for the quarter ended September 2023 at ₹1.53 crore as against ₹4.41 crore in the same quarter previous year. The stock declines by 1.21% on the NSE, trading at ₹126.35.

Khandwala Securities posted a standalone net profit of ₹11.02 lakh as against ₹44.86 lakh in the same previous quarter. The stock rises by 3.51% on the BSE, trading at ₹24.50.

Protean eGov Technologies which listed in the bourses today is trading at ₹852, up by around 7.5 per cent over its issue price of ₹792. At current levels the stock is valued at 32 times its FY22 EPS

India Ratings & Research (Ind-Ra) believes that RBI’s direction to Bank of Baroda to suspend on-boarding of customers through its mobile application, bob World, is likely to impact its ability to sustain its liability growth, primarily CASA (current account savings account) generation through on-boarding of new salary accounts in urban and metro regions. The rating agency said about 98% and 91% of SA and CA are being sourced digitally. Moreover, 58% of fixed deposits and 42% of recurring deposits, which are being booked through bob World, are likely to be negatively impacted.

However, in terms of assets, the impact would be limited as cross-selling for retail products (personal loans and credit cards) to existing bob World customers would be sufficient to meet growth requirements in the medium term.

The continuing of transactions through internet banking, tab banking and branch banking would remain unaffected. The agency said it understands that BoB has already taken remedial measures and is awaiting a review of the measures taken by the RBI to resolve the issue.

ONGC to start oil production from $5-billion deep-water project this month. The stock trades at ₹194.85 on the NSE, down by 0.97 per cent.

India imported 164.7 lakh tonnes (lt) of edible oil during the oil year 2022-23 (November to October), against 140.3 lt in 2021-22, recording a growth of 17.39 per cent.

In terms of value, India imported approximately ₹1.38 lakh crore of edible oil during the oil year 2022-23, as against ₹1.57 lakh crore in 2021-22 and ₹1.17 lakh crore in 2020-21.

Copper prices have dropped sharply over the last one week. The copper futures contract traded on the Multi Commodity Exchange (MCX) hit a high of ₹715 per kg on Monday last week, and has declined about 2 per cent from there. The contract is currently trading at ₹700 per kg.

Abans Enterprises informed the exchange about resignation of Abhishek Bansal as a Chairman and Managing Director. The stock trades at ₹155 on the BSE, up by 4.69%.

At 1:30 p.m., the BSE Sensex dropped 304.46 points (0.47%) to 64,954.99, and the NSE index declined by 77.60 points (0.40%) to 19,447.95. This dip was influenced by IT and financial stocks as investors awaited domestic retail inflation data.

On the NSE, out of 2,497 traded stocks, 934 advanced, 1,459 declined, and 104 remained unchanged. Notably, 94 stocks hit upper circuit, 47 reached lower circuit, with 131 at a 52-week high and 8 at a 52-week low.

Except for PSU Bank and Metal indices, all Nifty sectoral indices are in the red, while the Nifty PSU Bank index rose by 1.79 points at mid-day trade.

Gujarat Toolroom informed the exchange about resignation of Kalpesh Anilbhai Malvi from the position of Managing Director and Chief Financial officer. The stock rises by 1.98% on the BSE, trading at ₹40.66.

Asit C Mehta Financial Services reported regarding disposal of 1,,26,000 number of equity shares comprising 2.54% of the paid up share capital of the Company. The stock rises by 4.58% on the BSE, trading at ₹145.

Phoenix Mills stock trades at ₹2,090 on the NSE, up by 3.97%. The company’s board recently approved the allotment of 4,000 equity shares of ₹2 each fully paid-up to the grantees upon exercise of stock options pursuant to The Phoenix Mills Employees’ Stock Options Plans.

ICICI Securities Limited has informed the Exchange regarding allotment of 28,270 shares. The stock declines by 1.75% on the NSE, trading at ₹645.05.

Vardhman Holdings reported its standalone net profit at ₹23.09 crore as against ₹3.81 crore in the same quarter previous year. The stock trades at ₹2,857 on the NSE, up by 0.77%.

The Rane Group has bagged new business orders worth about Rs 320 crore in Q2 of this fiscal, driven by demand in the passenger vehicle (PV) and commercial vehicle (CV) segments.

During the September 2023 quarter, Rane NSK won an order worth Rs 175 crore from a domestic PV customer to supply electronic power steering for an SUV model. There has been a good order flow from PV makers due to robust sales of new SUV models.

Bajaj Healthcare reported its revenue from operations reported at ₹1012.10 million in Q2 and ₹2309.46 million for H1 FY24. The stock rises by 2.22% on the NSE, trading at 387.

Glenmark Pharmaceuticals stock drops by 4.44% on the NSE, trading at ₹729. For the second quarter of FY 202324, Glenmark’s consolidated revenue was at ₹35,879 million as against ₹33,752 million recording an increase of 6.3% y-o-y.

Senco Gold (₹700) released their number for the second quarter of the financial year 2023-24 on Friday. Reacting to the results, the stock is up 2.4 per cent today.

The consolidated revenue grew 26 per cent to ₹1,147 crore versus ₹911 crore in the same quarter last year. Net profit for the quarter improved 36 per cent to ₹11.9 crore as against ₹8.8 crore in the corresponding period of the previous fiscal. The company reports that this is its highest-ever Q2 revenue.

Major gainers on the NSE at noon

Coal India (4.17%); Eicher Motors (1.70%); NTPC (1.35%); BPCL (0.79%); Hindalco (0.74%)

Major losers:

SBI Life (-1.62%); Bajaj Finance (-1.38%); Apollo Hospitals (-1.15%); Cipla (-0.98%); ICICI Bank (-0.94%)

Stocks advanced on BSE at 12 noon on November 13, 2023, were 1,601 against 2,012 stocks that declined; 153 stocks remain unchanged. Total stocks traded were 3,766. The number of stocks that recorded a 52-week high was 281, and those that hit a 52-week low was 16.

Allied Blenders and Distillers Limited (“ABD”) owns and operates its distillery located in Rangapur, Telangana. This unit makes Extra-Neutral Alcohol (ENA), the key raw material used in the manufacture of alcohol beverage products.

The Company recently completed expansion of the annual capacity of its distillery from 55 million litres to 65 million litres. This expansion has been carried out through internal accruals.

Suman Chowdhury, Chief Economist and Head -Research, Acuité Ratings & Research “Industrial activity has seen a healthy uptick in the first half of the current fiscal with IIP growth at 6.0%YoY which is one of the highest prints for H1 if one excludes the last 2 years after Covid. While there still was some moderate base support, steady implementation of infrastructure projects has continued to boost demand for cement and steel while rainfall deficiency in the monsoon season has driven the demand for power and coal. Without the base support and risks of weaker rural demand, we expect IIP growth to moderate in the second half of the fiscal. On an overall basis, IIP growth is likely to be lower than 5.3% recorded in the previous year.”

The Bank Nifty Index dropped sharply after briefly breaching the 44,000-mark in the special Muhurat trading on Sunday. The index is currently trading at 43,750, down 0.55 per cent. The advances/ declines ratio is at 4:8, which indicates the inherent weakness in the index.

TCI Industries informed the exchange that the board has issued and allotted 3,200, nos. of 0% Non-Convertible Redeemable Preference Shares (NCRPS) of Face Value of ₹100 each at a premium of ₹300 each on Private Placement basis to Umah Agarwal, a person belonging to the Promoter and Promoter Group of the Company for cash.

The stock rises by 4.94% on the BSE, trading at ₹1,351.

Asian Paints informed the exchange that the Office of Assistant Commissioner, State Commercial Tax, Sector 5, Uttar Pradesh passed an order under Section 20 of the Integrated Goods and Services Tax Act, 2017 and Section 129(3) of the Central Goods and Services Tax Act, 2017, imposing a penalty of ₹1,64,812. The stock trades at ₹3,075 on the NSE, down by 0.75%.

Shares of Protean eGov Technologies made a flat debut on Monday, listing at par with the issue price of Rs 792.

The stock made its debut at Rs 792 on the BSE. Later, it climbed 3.91 per cent to Rs 823.

The company commanded a market valuation of Rs 3,288.52 crore during the morning trade.

The Initial Public Offer (IPO) of Protean eGov Technologies was subscribed 23.86 times on the last day of subscription on Wednesday.

The Rs 490 crore IPO had a price band of Rs 752-792 per share.

The public issue of Protean eGov Technologies (formerly known as NSDL E-Governance Infrastructure) was purely an Offer of Sale (OFS).

Protean eGov Technologies is one of the key IT-enabled solution companies in India engaged in conceptualising, developing, and executing nationally critical and population-scale greenfield technology solutions.

The company collaborated with the government and has extensive experience in creating digital public infrastructure and developing innovative citizen-centric e-governance solutions.

Originally set up as a depository in 1995, it created a systemically important national infrastructure for capital market development in India. - PTI

The Bank Nifty Index dropped sharply after briefly breaching the 44,000-mark in the special Muhurat trading on Sunday. The index is currently trading at 43,750, down 0.55 per cent. The advances/ declines ratio is at 4:8, which indicates the inherent weakness in the index. Read more

The rupee depreciated 4 paise to 83.32 against the US dollar in the morning session on Monday, tracking a negative trend in domestic equities.

Persistent foreign fund outflows also weighed on the local unit, forex traders said. Read more

Major gainers:

Share India (9.34%); Reliance Power (8.51%); IFCI (7.55%); DBL (6.71%); Hindustan Copper (6.27%)

Major losers:

Glenmark (-4.13%); Biocon (-4.05%); Car Trade (-3.45%); Bajaj Electricals (-3.42%); KPI Green (-3.07%)

Lambodhara Textiles reported net profit at ₹61.64 lakh for the quarter ended September 2023, as against ₹617.05 lakh in the same previous quarter. The stock declined by 1.63% on the NSE, trading at ₹154.10.

Sensex and Nifty 50 have begun the week on a negative note. The benchmark indices have failed to get a strong follow-through buying after rising in the special Muhurat trading on Sunday. Sensex is trading at 64,890, down 0.56 per cent. Nifty is at 19429, down 0.5 per cent. For more

The Everest Kanto Cylinder stock jumps 14.55% on the NSE, trading at ₹141.35. The company’s Q2 FY24 revenue stood at ₹299 crore; EBITDA at ₹41 crore, margins at 14 per cent and PAT at ₹26 crore

The benchmark equity indices declined in early trade on Monday amid weak trends in the Asian markets and unabated foreign fund outflows.

The 30-share BSE Sensex fell 318.75 points to 64,940.70 in morning trade. The Nifty declined 82.8 points to 19,442.75.

Among the Sensex firms, Bajaj Finance, Infosys, ICICI Bank, Nestle, Kotak Mahindra Bank and Asian Paints were the major laggards. NTPC, IndusInd Bank, Sun Pharma and Power Grid were the gainers. For more

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Allcargo Logistics stock rises by 1.24% on the NSE, trading at ₹281.95. The company recently posted its financial results for the quarter ended September 2023 and issuance of bonus shares.

On Monday, Indian blue-chip shares experienced a decline, primarily driven by losses in information technology and financial stocks, with investors eagerly anticipating domestic retail inflation data for October.

The NSE Nifty 50 index dropped by 0.51% to 19,425.40, and the S&P BSE Sensex fell by 0.58% to 64,878.70 as of 10:25 a.m.

Following a special one-hour “muhurat” trading session on Sunday, where Nifty 50 and Sensex reached three-week highs, the subsequent pullback was attributed to technical factors, with IT, financials, and FMCG sectors experiencing losses.

Analysts maintain confidence in the market’s momentum, citing in-line earnings, promising macroeconomic data, and increasing retail participation. Retail inflation data for October is expected after market hours.

Centrum Broking

Mold-Tek Packaging – Volume growth remains muted led by paints & food (Add, TP: Rs969)

Mold-Tek Packaging reported sales decline of 7%. Volumes grew modestly by 5% while realization dropped by 11% YoY to Rs194/kg. The modest volume growth was on account of decline in volumes in Paints (-8%). Though Food & FMCG (ex-Q-Packs) volumes grew by 15%, growth was less than anticipated. Sales decline too was led by Paints (-20%) & Lubes (-7%) while F&F (incl. Q-Packs) grew by 18%. While weak volumes in paints was on account of client rationalization F&F was on account of washout season for ice creams. GP/kg and EBITDA/kg both reported decline by 7/10% respectively. Though we remain bullish on Mold-Tek on account of market leadership in IML packaging, massive capacity expansion and introduction of new product categories we believe that near term growth is priced-in. We cut our FY24/FY25 PAT estimates by 13/12% respectively and roll forward to FY26. We maintain ADD rating & value the company at 30x 1HFY26E EPS to arrive at TP of Rs969 (earlier TP of Rs971).Mold-Tek Packaging – Volume growth remains muted led by paints & food (Add, TP: Rs 969)

Mold-Tek Packaging reported sales decline of 7%. Volumes grew modestly by 5% while realization dropped by 11% YoY to Rs194/kg. The modest volume growth was on account of decline in volumes in Paints (-8%). Though Food & FMCG (ex-Q-Packs) volumes grew by 15%, growth was less than anticipated. Sales decline too was led by Paints (-20%) & Lubes (-7%) while F&F (incl. Q-Packs) grew by 18%. While weak volumes in paints was on account of client rationalization F&F was on account of washout season for ice creams. GP/kg and EBITDA/kg both reported decline by 7/10% respectively. Though we remain bullish on Mold-Tek on account of market leadership in IML packaging, massive capacity expansion and introduction of new product categories we believe that near term growth is priced-in. We cut our FY24/FY25 PAT estimates by 13/12% respectively and roll forward to FY26. We maintain ADD rating & value the company at 30x 1HFY26E EPS to arrive at TP of Rs 969 (earlier TP of Rs 971).

Crude oil futures traded lower on Tuesday morning over the slowing demand for crude oil in the US and China markets. These are the two major consumers of crude oil in the world market. At 9.43 am on Tuesday, January Brent oil futures were at $80.66, down by 0.95 per cent; and December crude oil futures on WTI (West Texas Intermediate) were at $76.41, down by 0.98 per cent. November crude oil futures were trading at ₹6378 on Multi Commodity Exchange (MCX) in the initial trading hour of Tuesday morning against the previous close of ₹6455, down by 1.19 per cent; and December futures were trading at ₹6397 as against the previous close of ₹6473, down by 1.17 per cent.

Foreign Portfolio Investors (FPIs) selling spree continued as they dumped Indian equity worth over ₹5,800 crore this month so far on rising interest rates and geopolitical tensions in the Middle East. This came after such investors withdrew ₹24,548 crore in October and ₹14,767 crore in September, data with the depositories showed.

Before the outflow, FPIs were incessantly buying Indian equities in the last six months from March to August and brought in ₹1.74 lakh crore during the period.

Major gainers on the NSE at 9:30 am:

Eicher Motors (2.01%); Coal India (1.34%); NTPC (0.74%); Hindalco (0.52%); BPCL (0.47%)

Major losers:

SBI Life (-0.96%); Bajaj Finance (-0.90%); ONGC (-0.86%); Infosys (-0.82%); HDFC Life (-0.79%)

India’s retail inflation based on the Consumer Price Index (CPI) is likely to be in the range of 4.5 to 4.9 per cent. The Statistical Ministry will release the data at 5.30 pm on Monday.

The rate of inflation was 5.02 per cent in September, a three-month low. If the October reading falls below 5 per cent, it will be the fourth month in the calendar year that inflation has recorded a sub-5 per cent number. It will also give the Monetary Policy Committee (MPC) an extra cushion in its policy interest rate review. After hiking the rate by 2.50 per cent, the Committee has held rates steady four times, and is expected to do the same when meets next month.

Despite the positive sentiment associated with Dhanteras, the Indian benchmark indices, namely the Sensex and Nifty, experienced a weak opening on Monday. In early trade, the 30-share BSE Sensex declined by 264.68 points to reach 64,994.77, and the NSE Nifty witnessed a drop of 71.25 points, reaching 19,454.30. Gainers in the Sensex pack included Eicher Motors, Coal India, BPCL, Hindalco, and Adani Enterprises, while Infosys, Bajaj Finance, Titan, ONGC, and Nestle were among the laggards.

Asian stocks are up in early deals today, tracking the strong closing in the US stocks. Due to the holiday mood, analysts expect volume to remain low.

The Indian economy currently finds itself in a sweet spot of growth and is well-poised for continued resilience in the face of global challenges. Samvat 2080 will be a fascinating year to watch out for the global economy, said Pranav Haridasan, MD & CEO, Axis Securities.

Prashanth Tapse, Senior VP Research Analyst at Mehta Equities Ltd., anticipates a promising Samvat 2080, bidding farewell to Samvat 2079. Nifty at 19425 and Sensex at 64905 set the stage for an exciting Muhurat trading session. Tapse’s ‘Diwali Picks 2023’ includes 12 stocks like HDFC Bank, L&T, Tata Motors, and more, emphasizing balanced investment potential. The market optimism stems from factors such as a ‘soft landing’ by the Federal Reserve, robust GST numbers, active retail participation, easing Middle East tensions, and falling WTI oil prices.”

In the upcoming Samvat year, market sentiment is poised for improvement as the Fed may adopt a less aggressive stance on interest rates, and inflation may ease due to a higher base effect. Sunil Damania, Chief Investment Officer at MarketsMojo, predicts outperformance in capital goods, pharma, and cement, while cautioning that public and private banks, NBFCs, and the auto sector might lag. Bullish on mid and small caps, Damania anticipates exceptional market performance by the next Samvat, fueled by the increasing participation of retail investors.

Sprayking Agro Equipment Ltd has recorded extraordinary half yearly (H1FY24) performance with Revenue from Operations and Profit after Tax. On quarterly basis, revenue from operations stood at ₹325.106 million in Q2FY24 which was ₹32.246 million in Q2FY23, an increase of 908.21 %. Further EBIDTA for Q2FY24 recorded at ₹44.918 million versus ₹2.010 Million in Q2FY23, an increase of 2134.73 %.

Where is the US 10Yr Treasury yield headed and how can this set the path for the movement in equities, gold or even Indian government bonds? Here’s our analysis

Predictions may turn awry but you can glean insights. Here are 3 checks to apply

A lot of investors are, of late, suffering from ‘dormant account syndrome’.

Demat and trading accounts of investors who haven’t done a single trade, i.e. buying or selling stocks in his/her account for a period of 12 months, will be inactive.

For trading account, the term ‘inactive account’ refers to such account where the client has not logged in either through internet or telephone or no transactions have been carried out by the clients either Online or Offline in last six calendar months. In case of Demat account, the term Dormant/Inactive account refers to such accounts where no customer induced (debit/credit) transaction had taken place for a continuous period of 6 (six) months

Indians have always had a rush for gold, which only gets stronger during Dhanteras, as they consider buying the yellow metal on Diwali day auspicious. The glitter of the physical gold apart, even products such as gold ETFs, gold mutual funds and sovereign gold bonds (SGBs) are shining bright these days, each with its own pros and cons.

As we enter the new Samvat year, some factors impacting market sentiment will start to ease. The Fed may not be as aggressive on interest rates, and besides, inflation could cool purely because of the higher base effect.

Capital goods, pharma and cement, will outperform, while public and private banks, NBFCs and the auto sector may wind up laggards.

We also expect mid and small caps to outperform large caps. If you look at the data from the last Samvat to the current one, there is hardly any difference between the performance of large, mid and small caps. On the contrary, small caps have performed better than large caps. Therefore, the performance of the Indian equity market going forward would be driven more by small and mid-caps. We are bullish about mid and small caps, given the yearly rise of retail investors. By the next Samvat, we expect the market to perform exceptionally well.

“As we bid farewell to Samvat 2079, the horizon of Samvat 2080 looks promising. Wishing you a joyous Deepavali and prosperous times ahead. With Nifty at 19425 and Sensex at 64905, anticipation builds for an electrifying start, especially in today’s special Muhurat trading session at 6.00 PM. Our ‘Diwali Picks 2023’ features 12 stocks with balanced investment potential, including names like HDFC Bank, L&T, Tata Motors, Indigo, Tata Power, ABFRL, Crompton Greaves Consumer Electricals, Usha Martin, Doodla Dairy, Ashoka Buildcon, LG Bal Bros, and Imagica. We recommend accumulating these value picks with strong fundamentals for potential growth. The market optimism is fueled by factors such as the Federal Reserve’s efforts for a “soft landing,” robust GST numbers, active retail participation, easing Middle East hostilities, and declining WTI oil prices. Here’s to Happy Investing and a Joyous Deepavali.”

BSE: Strong performance across parameters

(BSE IN, Mkt Cap USD3.3b, CMP INR2011, TP INR2250, 12% Upside, Neutral)

BSE reported PAT of INR1.2b in 2QFY24 (beat on our estimates), up 303% YoY but down 73% QoQ (gain on sale of CDSL stake recorded in 1QFY24). However, adjusted PAT came in at INR1.07b, up 71% QoQ.

- BSE reported operating revenue of INR3.1b, up 46% QoQ and 59% YoY, beating our estimates.

BIOCON: Delay in new approvals drags biosimilar prospects

(BIOS IN, Mkt Cap USD3.3b, CMP INR227, TP INR220, 3% Downside, Neutral)

Pricing pressure in API segment adds woes

- Biocon (BIOS) 2QFY24 financial performance missed our estimates. While the traction in the biologics business has been improving from commercialized products, the increased pricing pressure in generics and higher operating cost led gradual improvement in profitability. Research services exhibited healthy high-teen YoY growth in revenue for the quarter.

- We reduce our earnings estimate by 7%/2% to factor in a) the challenges in the API segment of generics business, b) slower off-take of b-adalimumab. We continue to value BIOS on an SoTP basis (15x 12M forward EV/EBITDA for 70% stake in biosimilar business, 54% stake in Syngene and 10x EV/EBITDA for generics business) to arrive at a price target of INR220.

- The biosimilar outlook is getting dulled due to the time required to resolve regulatory issues at Malaysia/Bengaluru site. Also, as highlighted in our note, the competition is building up faster in products under development (b-Denosumab/b-Ustekinumab). While there is healthy traction in the formulation segment, API is facing challenges in the generics segment. Syngene also reduced its outlook for 2HFY24. Considering these factors and valuation adequately capturing the earnings upside, we reiterate our Neutral rating on the stock.

APOLLO HOSPITALS: Seasonality/higher realization drive earnings

(APHS IN, Mkt Cap USD9.1b, CMP INR5279, TP INR6070, 15% Upside, Buy)

Healthco EBITDA breakeven on track by 4QFY24E

- Apollo Hospitals (APHS) delivered a healthy beat on estimates in 2QFY24 driven by improved occupancy and better ARPOB. Healthco also witnessed a reduction in operational losses for the quarter.

- We cut our earnings estimates by 13%/14% for FY24/FY25, factoring in: 1) the gradual addition of beds, b) some moderation in GMV growth with respect to Apollo 24/7, c) higher doctor acquisition costs, and d) marketing expenses. We value APHS on an SOTP basis (24x 12M forward EV/EBITDA for Hospitals segment, 12x 12M forward EV/EBITDA for back-end pharmacy, 25x 12M forward EV/EBITDA for AHLL, 20x 12M forward EV/EBITDA for front-end pharmacy and 2x 12M forward EV/sales for Apollo 24/7) to arrive at our TP of INR6,070.

- APHS remains on track to improve the profitability of Healthco. It is also building the diagnostic business with the robust addition of network collection centers as well as improved footfalls per day at existing centers. The expansion plan for the hospitals has a good mix of organic as well as M&A initiatives, with meaningful benefits likely to accrue from FY26 onwards. Reiterate BUY.

MS on AU Bank: Maintain Overweight on Bank, raise target price at Rs 1000

MS on Manappuram: Maintain Overweight on Bank, target price at Rs 183

Investec on BSE: Maintain Buy on Company, raise target price at Rs 2345

CLSA on Eicher Motors: Maintain Buy on Company, raise target price at Rs 4252

Jefferies on Eicher Motors: Maintain Buy on Company, raise target price at Rs 4650

CLSA on Abbott: Maintain Buy on Company, raise target price at Rs 27500

CLSA on Ramco Cement: Maintain Underperform on Company, raise target price at Rs 1045

CLSA on ONGC: Maintain Buy on Company, raise target price at Rs 225

Nomura on Colgate: Maintain Hold on Company, hike target price at Rs 2100

HSBC on Colgate: Maintain Neutral on Company, hike target price at Rs 2100

Jefferies on Coal India: Maintain Buy on Company, raise target price at Rs 385

Nomura on Fortis: Maintain Buy on Company, target price at Rs 388

Nomura on IPCA Labs: Maintain Buy on Company, target price at Rs 1133

MS on M&M: Maintain Overweight on Company, target price at Rs 1697

MS on Ashok Ley: Maintain Overweight on Company, target price at Rs 214

CLSA on Ashok Ley: Maintain Buy on Company, target price at Rs 238

MS on AB Fashion: Maintain Underweight on Company, target price at Rs 176

MS on SAIL: Maintain Underweight on Company, target price at Rs 80

CLSA on HAL: Maintain Buy on Company, target price at Rs 2055

MS on AB Fashion: Maintain Underweight on Company, target price at Rs 176

Incred on BlueJet: Maintain Reduce on Company, target price at Rs 330

Nomura on Glenmark: Maintain Neutral on Company, target price at Rs 841

Macquarie on Ramco Cem: Maintain Neutral on Company, target price at Rs 1000

MS on Tata Chem: Maintain Equal weight on Company, target price at Rs 1028

MS on Eicher Motors: Maintain Equal weight on Company, target price at Rs 3552

LIFE INSURANCE CORPORATION: Robust improvement in EV; VNB margin flat

(LICI IN, Mkt Cap USD46.3b, CMP INR610, TP INR850, 39% Upside, Buy)

Gradual diversification toward non-par & protection

- PAT for 1HFY24 stood at INR174b, including INR138b (net of tax) related to accretions on the available solvency margin transferred from Non-Par fund to the shareholders account. PAT for 2QFY24 was INR79.3b.

- Net premium declined 19% YoY to INR1.07t in 2QFY24. The market share in premium dropped to 58.5% in 1HFY24 from 68.25% in 1HFY23.

- VNB (net) declined 19% YoY to INR18.5b in 2Q, hit by a 20% decline in APE. However, VNB margin (net) remained flat at 15.4% vs. 15.2% in 2QFY23.

- Net margin in the Individual Par segment stood at 10.3% in 1HFY24 vs. 10.6% in 1HFY23. For the Non-Par segment, it declined to 50% from 68.7% in 1HFY23. In the group segment, net margin rose to 14.6% from 12.9% in 1HFY23.

- We cut our VNB estimates to factor in the decline in VNB margins. However, we raise our EV estimates owing to better-than-expected equity market returns. We reiterate our BUY rating on the stock with a TP of INR850 (0.7x FY25E EV).

LIC reported broadly in-line numbers in H1FY24, owing to weaker growth, strong boost in embedded value led by equity-market performance, and part provision on account of increased family pension liabilities. We continue to perceive that structural challenges—such as slower growth-led market-share loss, sticky operating expenses, and higher sensitivity to equity market-led EV volatility—are likely to cloud LIC’s outlook. However, LIC is currently trading at ~0.50x Sep-25E P/EV, with the structural challenges and a possible share sale by the government already in the price. We upgrade the stock to BUY, as we believe higher surplus generation and slower growth could lead to a step jump in dividend, as solvency is healthy. Our fair value Sep-24E TP is Rs760/share (offering 25% upside), and we value the shares at 0.63x Sep-25 EV (Cost of Equity: 13%; Operating RoEV: 10%; Single Stage Growth: 5%).

Tyson Foods, Inc. (Pre market) (Sector- FMCG)

Sun Life Financial Inc. (Post market) (Sector- Financial)

AECOM (Post market) (Sector- Engineering)

Shares of IPO of Protean eGov Technologies will be listed today. The issue, which came out with a price band of Rs 752-792, was subscribed 23.9 times.

The entire issue is an offer-for-sale from selling shareholders such as 360 One Special Opportunities Fund and 360 One Special Opportunities Fund, HDFC Bank, Axis Bank, Deutsche Bank AG, Union Bank of India, NSE Investments and Administrator of the Specified Undertaking of the Unit Trust of India will also offload shares via OFS. The company has also reserved 1.5 lakh equity shares for its employees, who get a discount of Rs 75 a share to the final issue price.

Som Distilleries said that the Income Tax Department officials concluded their search operations at the company’s premises on November 11. The search and seizure operations at the company’s offices and factories were conducted from November 7.

Buzzing Stocks: Saregama, Anant Raj, Indian Hotels, Bharti Airtel, Neuland, Jubilant Pharmova, HDFC Life, Som Distilleries, Usha Martin

Domestic markets are expected to open on a positive note on Monday as well. Dhanteras started on a positive note, and the sentiment will likely continue, said analysts. Gift Nifty at 19554 indicates a flat-to-positive opening for domestic markets, as Nifty futures on Diwali day closed at 19,538. While the market may open in a positive zone, some expect profit-taking at a higher level.

The board of Anant Raj approve issuance of equity shares or other convertible securities by way of Qualified Institutions Placement, for an aggregate consideration not exceeding Rs. 500 crore.

Saregama India Limited has acquired 51.82 per cent stake in Pocket Aces for Rs 165.61 crore. It picked up securities: 1,14,723 equity shares; 69,231 seed compulsorily convertible preference shares

A sudden explosive growth in stock options trading in India this year has got the country’s retail traders excited and regulators worried about the risks such speculative fervour could spawn.

The boom in derivatives trading in the country’s historically conservative markets, where some products such as stock futures are still too expensive, has come after stock exchanges changed some options contracts to facilitate quicker and cheaper bets and as online retail trading platforms mushroomed.

Data from exchanges, which are big winners of this surge in demand, shows the daily average value of assets underlying these stock options more than doubled between March and October to $4.2 trillion. The ratio of the notional value of derivatives to cash trading is the highest in the world. -- Reuters

Navin Fluorine and a slew of new projects is not new for investors. The company has traded at an average of 47 times one-year forward earnings in the last two years. This, on a track record of executing strategic projects successfully. While the next set of projects look to extend the streak, they will have to be executed under a new leadership (which is yet to be in place).

The Power Ministry has scheduled tenders of around 50 GW annually of renewable energy for the next five years, to achieve the target of 500 GW of non-fossil fuel capacity. Alongside the government’s thrust on ramping up renewable energy capacity, building incremental thermal capacity has also been a priority.

​Crude oil prices fell for the third week in a row​ – Brent crude oil futures on the Intercontinental Exchange (ICE) slumped 4.1 per cent to close at $81.4 per barrel. Crude oil futures on the MCX dropped 3.2 per cent to end the week at ₹6,487.

The war risk premium seems to be fading and the oil market fundamentals are having a bigger say on the prices.

The precious metals witnessed profit booking last week as well leading to a fall in prices. Gold, in dollar terms, declined 2.8 per cent to close at $1,936.8 per ounce. Silver lost 4.3 per cent and ended the week at $22.2 an ounce.

Zydus Lifesciences’ stock saw a strong rebound over the past couple of weeks. It found support at ₹570 and then rallied. Since the overall trend is bullish, the recent bounce in price indicates that the corrective decline has come to an end.

Raymond’s stock has potentially ended the corrective fall after finding the 200-day moving average support at ₹1,625 two weeks ago. The stock bounced off that level and surpassed a key hurdle at ₹1,840 a fortnight ago. This denotes that the bulls have regained control and this increases the odds of a further rally.

Kotak Mahindra Bank’s stock has largely been oscillating between ₹1,650 and ₹2,000 since early 2021. Since the stock is currently hovering near the range bottom, the probability of a rally is high.

After a rather flattish Diwali year 2022, there were fireworks in the markets this Diwali year. From last Diwali until now, equities regained their mojo with Sensex hitting a new life-time peak during this period. It is still sitting pretty on 10 per cent gains.

The Indian benchmark indices extended their upmove for the second consecutive week. However, the price action on the chart indicates lack of strength. The Dow Jones Industrial Average in the US has also risen well for the second week. Indeed, on the charts, the Dow Jones is looking more bullish and much stronger than the Indian benchmark indices. As such, the chances are looking high for the Dow Jones to outperform the Sensex and Nifty in the coming weeks.

Asian equity markets are advancing in the wake of a tech-driven rally on Wall Street last Friday, as investors eagerly anticipate crucial US inflation data scheduled for release on Tuesday.

On Monday, Japanese stocks opened on a positive note, with the benchmark Nikkei 225 index gaining 0.57%, or 208.67 points, reaching 32,776.18 in early trade. Simultaneously, the broader Topix index saw an increase of 0.33%, or 7.38 points, reaching 2,343.36.

The positive momentum in Japanese stocks followed a favourable closing on Wall Street on Friday, rebounding from a previous day’s decline prompted by hawkish remarks from Federal Reserve Chair Jerome Powell.

South Korea’s KOSPI has also experienced an uptick, rising by 0.31% or 7.56 points to 2,417.22. Conversely, Australia’s S&P ASX200 index has dipped slightly, down 0.11% or 7.70 points to 6,968.30.