Sensex above 37,000; metal stocks tank
01 August 2019
Bharti Airtel posted Rs 2,866 crore loss in Q1:
Telecom major Bharti Airtel has reported consolidated net loss of Rs 2,866 crore in the quarter ended June 2019 against profit of Rs 107.2 crore in the quarter ended March 2019.
Revenue of the company was up marginally at Rs 20,737.9 crore versus Rs 20,602.2 crore.
USFDA conclude inspection at Dishman Carbogen Amcis' arm:
Dishman Carbogen Amcis' wholly owned subsidiary, Carbogen Amcis AG's manufacturing site in Neuland, Switzerland, has successfully completed a US Food and Drug Administration (FDA) pre-approval inspection.
The inspection was concluded with no Form 483's filed, thus confirming that no critical or major observation was raised during the inspection.
Market close: The final hour recovery helped the Nifty to close around 11,000 level and Sensex above 37,000 after remained under immense selling pressure throughout the day.
At close, the Sensex was down 462.80 points at 37,018.32, while Nifty was down 138 points at 10,980. About 830 shares have advanced, 1587 shares declined, and 147 shares are unchanged.
Vedanta, JSW Steel, Hindalco Industries, SBI and Tata Motors were among major losers on the Nifty, while gainers were Wipro, Bharti Infratel, Maruti Suzuki, Reliance Industries and Power Grid Corp.
Among sectors, except energy all other indices ended on weak note led by the metal (down 3 percent), PSU bank (down 2 percent), IT (down 1.8 percent) followed by infra, pharma and FMCG.
Buzzing: Shares of commercial vehicle maker Ashok Leyland fell nearly 4 percent on August 1 after the company reported subdued sales in July and disappointing numbers in the quarter ended June 2019.
Market recovers from low: benchmark indices witnessed some recovery from the low point of the day.
At 15:17 hrs IST, the Sensex is down 421.88 points or 1.13% at 37059.24, and the Nifty down 127.30 points or 1.14% at 10990.70. About 737 shares have advanced, 1616 shares declined, and 108 shares are unchanged.
Market at day's low: Benchmark indices are trading at day' low level on August 1 with Sensex fell 600 points.
At 14:36 hrs IST, the Sensex is down 600.61 points at 36880.51, while Nifty is down 185.20 points at 10932.80. About 641 shares have advanced, 1644 shares declined, and 114 shares are unchanged.
Buzzing: Shares of IT company Wipro gained 4 percent on August 1 after capital market regulator SEBI cleared share buyback proposal.
After the approval from Securities and Exchange Board of India, company said it would dispatch the Letter of Offer for the buyback to eligible shareholders appearing on the record date of June 21, 2019, on or before August 6, 2019.
Magma Fincorp Gains 4% on Growth in Q1 AUM
Magma Fincorp's June quarter profit fell sharply by 84 percent year-on-year to Rs 10.6 crore and gross NPA weakened to 5.1 percent against 4.8 percent QoQ, but revenue grew by 7.3 percent to Rs 631.3 crore.
Assets under management increased 9.1 percent year-on-year and 1.7 percent QoQ.
Kotak's take on Automobile Sector
"We wonder if the automobile industry should adopt certain self-help measures including (1) price cuts to stimulate demand in the short term and (2) partnership with government in the medium term for faster rollout of electric vehicles (EV) with development of the entire EV chain instead of relying on the government for lower taxes. The industry’s demand for lower taxes (though valid) should be seen in the context of the very high profitability and returns of the industry," Kotak Institutional Equities said.
TCS launches new ADD site feasibility platform: Tata Consultancy Services launched the ADD Site Feasibility Platform, which provides life sciences companies with a single, integrated platform that digitizes the site selection and activation processes, and facilitates data-driven decision-making while assessing site feasibility for multi-site clinical tria ls.
Mahindra and Mahindra July Auto sales: The company's total auto sales declined 15% at 40,142 units against 47,199 units, meanwhile the exports were up 3 percent at 2,668 units versus 2,594 units, YoY.
Its domestic auto sales were down 16 percent at 37,474 units. The passenger vehicle sales fell 15 percent at 16,831 units, M&HCV sales down 52 percent at 417 units and commercial vehicle sales shed 17 percent at 15,969 units, YoY.
Sensex breaches 37,000:
Benchmark indices are trading at day's low level with Sensex breached 37,000 for the first time since March 14 after CRISIL cuts India's FY20 GDP growth estimate to 6.9 percent from 7.1 percent.
At 12:03 hrs IST, the Sensex is down 460.03 points at 37021.09, while Nifty is down 137.10 points at 10980.90. About 643 shares have advanced, 1406 shares declined, and 104 shares are unchanged.
At 11:00 hrs IST, the Sensex is down 393.11 points at 37088.01, while Nifty is down 121.50 points at 10996.50. About 675 shares have advanced, 1149 shares declined, and 107 shares are unchanged.
Maruti Suzuki July sales crash 34%:
Maruti Suzuki India, country's largest passenger vehicle maker, disappointed analyst on August 1 by reporting sharp fall in July sales due to continued slowdown in auto sector.
Company sold 1.09 lakh units in July 2019, the lowest in last two-year, declined by 33.5 percent compared to 1.64 lakh units sold in previous year.
Numbers were lower than Nomura expectation of 1.17 lakh units for the month.
Maruti said domestic sales in July 2019 were down 35.1 percent at 1 lakh units and passenger car sales fell 36.2 percent to 71,486 units compared to July 2018.
India Nikkei July Manufacturing PMI rises to 52.5
Economic growth in India's manufacturing industry was sustained in July. Companies scaled up production in response to a quicker upturn in factory orders. This, coupled with optimistic growth projections, underpinned job creation and an uptick in input purchasing.
Rising from 52.1 in June to 52.5 in July, the IHS Markit India Manufacturing Purchasing Managers’ Index (PMI) was consistent with a further strengthening in the health of the sector. The latest reading was slightly higher than the average for calendar year 2018 (52.3), but below its long-run trend (53.9). Source: IHS Markit
Bajaj Auto July Sales Fall 5%
Two-and-three-wheeler maker Bajaj Auto has reported a 5 percent year-on-year degrowth in July sales on account of continued subdued domestic demand.
The company sold 3.81 lakh units in July 2019, declined from 4 lakh units sold in same period last year.
Domestic sales fell 13 percent year-on-year to 2.05 lakh units, but exports increased 8 percent to 1.76 lakh units in July 2019, company said in its BSE filing.
"We don't see any greenshoots in demand yet. Domestic 2-wheeler volumes might continue to decline in August," Rajiv Bajaj, Managing Director said in an interview to CNBC-TV18.
Escorts hits 52-week low on poor tractor sales:
Shares of Escorts touched 52-week low of 452.70, falling nearly 4 percent in the early trade on August 1 on the back of poor sales in the month of July 2019.
Escorts' Agri Machinery Segment (EAM) in July 2019 sold 4,860 tractors against 5,610 tractors sold in July 2018.
Domestic tractor sales in July 2019 at 4,505 tractors against 5,483 tractors in July 2018.
Export for the month of July 2019 at 355 tractors registering a growth of 179.5 percent as against 127 tractors sold in July 2018.
Dollar Update: The dollar rose to a two-year peak against the euro and hit a two-month high versus the yen on Thursday as US Federal Reserve Chairman Jerome Powell ruled out a lengthy easing cycle after delivering the first rate cut since the financial crisis.
CLSA on Zee Entertainment
Maintain buy, target at Rs 515 per share
Stake sale to allay near-term concerns; management continuity critical
Deal is at an 11% premium to market price
Further 8-18% stake sale in co is likely
BNP Paribas on Zee Entertainment
Hold rating, target at Rs 390 per share
Uncertainty continues till September
Despite the deal announcement, promoter stake sale overhang will remain
Citi on Zee Entertainment
Maintain neutral call, target at Rs 430 per share
Oppenheimer buying up to 11% is not enough
Closing positive catalyst watch introduced before announcement
Await clarity on the precedence of the repayment to the various lenders
HSBC on Zee Entertainment
Maintain buy, target at Rs 434 per share
Transaction should help promoters to pare Debt
Possibility of getting a strategic investor on board looks bleak
Might have to swim through digitisation on its own
Credit Suisse on Zee Entertainment
Neutral call, target at Rs 400 per share
Promoter stake sale, not the best deal possible
Deal addresses only part of the promoter debt problems
Axis Capital on Zee Entertainment
Buy rating, target at Rs 415 per share
Stake sale healthy but overhang remains
May have to sell additional stake to address the possible shortfall
Expect the stock to remain sideways over next few months
CLSA on Eicher Motors
Maintain outperform rating, target cut to Rs 19,000 from Rs 21,000 per share
Gross-profit-per-vehicle for RE has been flattish in recent quarters
Believe premium 2-wheelers are better placed than the mass market segment
Credit Suisse on Eicher Motors
Maintain neutral, target cut to Rs 15,200 from Rs 19,900 per share
Margin continues to trend down; focusing on distribution expansion for revival
Cut FY20/21e EPS by 17%
Jefferies on Eicher Motors
Hold rating, target cut to Rs 17,800 from Rs 19,300 per share
EBITDA 7% below our estimate as margin slipped further to 25.9%
Cut volume & margin estimates for FY20-21 leading to 7% reduction in EBITDA
Morgan Stanley on Eicher Motors
Equal-weight call, target cut to Rs 17,052 from Rs 21,331 per share
Regulation-driven price hikes have led to a sharp slowdown in volumes
Cut FY20 & FY21 EPS by 17% & 15%
Lower FY23-29e margin assumption from 26% to 24%
CLSA on UPL
Maintain buy, target cut to Rs 720 from Rs 813 per share
On track to benefit from Arysta Synergies; FY20 guidance retained
Higher depreciation& inventory charges from Arysta Acqn impacted profits
On track to achieve at least $350 m/200m revenue/cost synergy by FY22
Citi on UPL
Buy rating, target at Rs 800 per share
Q1 results operationally in-line
Profit lower due to higher than expected amortisation post Arysta deal
Nomura on Ashok Leyland
Maintain neutral call, target at Rs 91 per share
Revenue 4% below estimates, EBITDA largely in-line
Margin at 9.4% against our estimate of 9.1%
Citi on IOC
Neutral call, target at Rs 165 per share
Big beat supported by inventory gains & resilient core marketing performance
Maintain positive view on the OMCs; political uncertainty is now behind us
Market opens: Market started on a weak note on August 1 with Nifty around 11,050.
At 09:17 hrs IST, the Sensex is down 212.12 points at 37,269.00, while Nifty is down 63.40 points at 11054.60. About 204 shares have advanced, 504 shares declined, and 33 shares are unchanged.
In the early trade Wipro, Power Grid, Axis Bank, Ashok Leyland, ICICI Bank, Trent, Tata Global, Ajanta Pharma are among major gainers on the indices, while losers include Zee Entertainment, Eicher Motors, UPL, Vedanta, JSW Steel, Tata Steel and Escorts.
All the sectoral indices are trading in the red led by the metal, pharma, bank, IT, infra, auto, FMCG and energy.
Market at pre-open: It is a mixed start for the market with Nifty trading below 11,100 in the pre-opening session on August 1.
At 09:02 hrs IST, the Sensex is up 33.47 points or 0.09% at 37514.59, and the Nifty down 33.10 points or 0.30% at 11084.90.
Crude Update: Oil prices fell more than USD 1 on Thursday, declining for the first time in six days, after the US Federal Reserve dampened hopes for a string of rate cuts and Sino-US trade talks ended without progress.
Asian markets trade weak: Asian shares fell to six-week lows on Thursday and the dollar rose after the US Federal Reserve delivered a 25-basis-point rate cut as expected but poured cold water on market expectations of a lengthy easing cycle.
Wall Street ends lower: The Dow and S&P 500 registered their biggest daily percentage drops in two months on Wednesday after Federal Reserve Chair Jerome Powell dampened expectations for further cuts following the central bank's first interest rate cut in a decade.
SGX Nifty: Trends on SGX Nifty indicate a negative opening for the broader indices in India, a fall of 43 points or 0.39 percent. Nifty futures were trading around 11,078-level on the Singaporean Exchange.