Sensex, Nifty Post Best Weekly Run In Nearly Eight Years

Shares of the Mumbai-based telephone service provider in Mumbai and Goa rose as much as 5.4 percent to Rs 7.20 after a consortium of Tata Group executives teamed up with TPG Capital to bid for the fiber network owned by the Indian conglomerate’s Tata Teleservices Ltd. unit, people with knowledge of the matter, told Bloomberg.

Shares of the country's biggest car maker fell as 2.1 percent to Rs 9,236 after it deferred the analysts conference call to 4 p.m.

Action Construction Equipment: The Delhi-based crane maker rose as much as 10 percent to record high of Rs 189.75 on the back of strong December quarter earnings.

• Revenues up 48 percent at Rs 279 crore versus Rs 188 crore
• Net profit up 220 percent at Rs 16 crore versus Rs 5 crore
• EBITDA up 145 percent at Rs 27 crore versus Rs 11 crore
• Margins at 9.7 percent versus 5.9 percent

Himadri Specialty Chemicals: The Kolkata-based specialty chemical maker rose as much as 4.5 percent to Rs 189.90 after IIFL initiated coverage on the stock with a buy rating for target price of Rs 240.

Phillips Carbon Black: The Kolkata-based carbon black maker rose as much as 8.5 percent to Rs 1,308 after the company said it will consider the proposal of a stock split on Jan. 31.

NIIT Technologies: The Noida-based IT services company rose as much as 6 percent to record high of Rs 914 on the back of heavy volumes. Trading volume was 5.7 times its 20-day average.

Shares of the agricultural chemical maker declined 3.26 percent to Rs 797.35 despite beating estimates in October-December quarter.

Key earnings highlights:

• Consolidated net profit at Rs 574 crore versus Bloomberg estimate of Rs 485 crore
• Consolidated net profit up 25 percent at Rs 574 crore versus Rs 459 crore (YoY)
• Consolidated net sales at Rs 4,194 crore versus Bloomberg estimate of Rs 4,365 crore
• Consolidated net sales up 7 percent at Rs 4,194 crore versus Rs 3,919 crore (YoY)
• Consolidated EBITDA at Rs 716 crore versus Bloomberg estimate Of Rs 852 crore
• Consolidated EBITDA down 1.4 percent at Rs 716 crore versus Rs 726 crore (YoY)
• Consolidated margin at 17.07 percent versus Bloomberg estimate of 19.5 percent
• Consolidated margin at 17.07 percent versus 18.52 percent (YoY)

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Gauge of government-owned banks on the National Stock Exchange extended losses and fell 4.7 percent, the most in over five months, to 3,779.20 after brokerages said the government's bank recapitalisation plan favour weak banks.

• IDBI Bank: The Mumbai-based state-run lender rose 1.15 percent to Rs 66.10. Trading volume was 9.8 times its 20-day average.
• Uco Bank: The Kolkata-based state-run lender rose 4.75 percent to Rs 33.05 after the government proposed to infuse Rs 6,507 crore under its bank recap plan. Trading volume was 8.1 times its 20-day average.
• Quess Corp: The Bangalore-based human resource service provider rose 1.39 percent to Rs 1,118. Trading volume was 5.8 times its 20-day average.
• VRL Logistics: The Hubli-based logistics service provider rose 3 percent to Rs 447. Trading volume was 6.1 times its 20-day average.

Brent oil hits $71 for the first time since June 2015.https://t.co/6XSbnnh8V5 pic.twitter.com/5YbShy8Lf0

— BloombergQuint (@BloombergQuint) January 25, 2018

Shares of the Mumbai-based suitcase maker rose 0.14 percent to Rs 368.90 after it reported December quarter earnings.

Key earnings highlights:

• Net Profit up 68.1 percent at Rs 26.89 crore versus Rs 15.96 crore (YoY)
• Revenue up 12.1 percent at Rs 338 crore versus Rs 301.6 crore (YoY)
• EBITDA up 57.2 percent at Rs 41.2 crore versus Rs 26.2 crore (YoY)
• Margin at 12.2 percent versus 8.7 percent (YoY)

Shares of the Hyderabad-based drug maker fell as much as 2.56 percent, the most since Jan. 3, to Rs 2,494 after it missed estimates in October-December quarter.

Key earnings highlights:

• Net profit at Rs 303 crore versus Bloomberg estimate Of Rs 337 crore
• Net profit down 38 percent at Rs 303 crore versus Rs 492 crore (YoY)
• One-time charge of Rs 93 crore
• Revenue at Rs 3,834 crore versus Bloomberg estimate Of Rs 3,688 crore
• Revenue up 4 percent at Rs 3,834 crore versus Rs 3,723 crore (YoY)
• EBITDA at Rs 792.5 crore versus Bloomberg estimate Of Rs 692 crore
• EBITDA down 8 percent at Rs 792.5 crore versus Rs 863.5 crore (YoY)
• Margin at 20.7 percent versus Bloomberg estimate of 18.8 percent
• Margin at 20.7 percent versus 23.2 percent (YoY)

Shares of the country's biggest private sector lender fell as much as 4.52 percent, the most in over five months, to Rs 315 after the government allocated Rs 8,800 crore to State Bank of India for the recapitalisation.

According to a brokerage, the amount allocated to State Bank of India was lower.

Macquarie said:

• Hope that the next tranche is concentrated to a few large, disciplined banks with improving processes and governance.
• BOI receives disproportionately more, SBI receives far less than estimated.

Shares of the country's biggest car maker were trading 0.16 percent lower at Rs 9,420 ahead of October-December quarter earnings.

Maruti Suzuki is expected to report net profit of Rs 2,006.5 crore on revenue of Rs 19,240 crore and EBITDA is expected to come in at Rs 2,979 crore, according to analysts tracked by Bloomberg.

Share of the Mumbai-based transformer maker rose as much as 11.68 percent, the most in over a month, to Rs 1,550 after it reported strong earnings in October-December quarter.

• Key earnings highlights:
• Revenue up 34.5 percent at Rs 228 crore.
• Net profit rose 190 percent to Rs 9.65 crore versus Rs 3.32 crore.
• EBITDA at Rs 14 crore.
• Margin at 6.1 percent from 4.4 percent.

• Dish TV has 62.8 lakh shares change hands in three blocks.
• Bharat Electronics has 15 lakh shares change hands in a single block.

Buyers and sellers were not immediately known

Source: Bloomberg

• Stick to PSB index or larger entities for 2 years perspective
• Network of larger banks being underestimated because of NPA issues
• More measured approach is warranted in metal space
• Metals will be cyclical play
• Small investors may get trapped in metal space
• Run away from stocks like HEG and graphite
• Larger commodity cycles may have shorter on
• Will not buy sugar trade, but will bet on political trade
• Lenders have stronger hand in bankruptcy cases
• Don't see any residual value in bankruptcy companies, new acquirers and lenders will benefit more

Shares of the Bangalore-based human resource service provider rose as much as 5.76 percent, the most in nearly a month, to Rs 1,167 after its net profit more than doubled in December quarter.

Key earnings highlights:

• Revenue up 48.5 percent at Rs 1,584 crore.
• Net profit up 106 percent at Rs 70 crore.
• EBITDA up 54 percent at Rs 91 crore.
• Margin at 5.7 percent from 5.5 percent.

Shares of the Mumbai-based IT services company rose as much as 5.8 percent to Rs 1,270 after it announced December quarter earnings post market hours yesterday.

Key earnings highlights:

• Revenue up 8 percent at Rs 1,884 crore.
• Net profit up 4 percent at Rs 283 crore.
• EBIT up 11 percent at Rs 281.5 crore.
• Margin at 14.9 percent from 14.5 percent.

Shares of the Bangalore-based bio-pharmaceutical firm fell as much as 5.41 percent, the most in three months, to Rs 600.20 after its net profit declined in October-December quarter.

Key earnings highlights:

• Revenue up 2 percent at Rs 1,058 crore.
• Net profit down 46 percent at Rs 92 crore.
• EBITDA down 20 percent at Rs 222 crore.
• Margin at 21 percent from 26.6 percent.

Shares of the Hyderabad-based construction company rose as much as 4.12 percent to Rs 131.40 after its board of directors approved opening of QIP at Rs 129.47.

Shares of the Mumbai-based state-run lender rose as much as 8.3 percent, the most since Jan. 4, to Rs 70.80 after the government allocated highest amount of Rs 10,610 crore in the bank recapitalisation plan.

Indian equity benchmarks opened little changed, as gains in Coal India, Axis Bank and ONGC were offset by losses in State Bank of India, Yes Bank and Infosys.

The S&P BSE Sensex was little changed at 36,134 and likewise the NSE Nifty 50 Index at 11.079.

The mid-cap and small-cap shares were trading on a mixed note as the S&P BSE MidCap Index rose 0.14 percent while the S&P BSE SmallCap Index declined 0.1 percent.

Eleven out of 19 sector gauges compiled by BSE were trading higher led by the S&P BSE Metal Index's 1 percent gain. On the other hand, the S&P BSE Information Technology Index was the top sectoral loser, down 0.95 percent.

Here’s how foreign and local funds played the market on Wednesday.https://t.co/avKbnJ3tFX pic.twitter.com/y2jyg7tPOJ

— BloombergQuint (@BloombergQuint) January 25, 2018

Other Earnings To Watch

• Ajanta Pharma
• Avenue Supermarts
• Future Supply Chain Solutions
• Jindal Steel & Power
• L&T Finance Holdings
• LIC Housing Finance
• Nilkamal
• Shriram City Union Finance
• Tata Coffee

Biocon Q3 (YoY)

• Revenue up 2 percent at Rs 1,058 crore.
• Net profit down 46 percent at Rs 92 crore.
• EBITDA down 20 percent at Rs 222 crore.
• Margin at 21 percent from 26.6 percent.

Canara Bank Q3 (YoY)

• Net Interest Income up 52 percent at Rs 3679.5 crore.
• Net profit down 61 percent at Rs 125.75 crore.
• Provisions up 24 percent at Rs 2674 crore (QoQ).
• Provisions for NPA down 3 percent at Rs 1,900 crore (QoQ).
• GNPA at 10.38 percent from 10.51 percent (QoQ).
• Net NPA at 6.78 percent from 7.02 percent (QoQ).

L&T Infotech Q3 (QoQ)

• Revenue up 8 percent at Rs 1,884 crore.
• Net profit up 4 percent at Rs 283 crore.
• EBIT up 11 percent at Rs 281.5 crore.
• Margin at 14.9 percent from 14.5 percent.

KPIT Technologies Q3 (QoQ)

• Revenue down 0.3 percent at Rs 913 crore.
• Net profit up 3.4 percent at Rs 61.7 crore.
• EBIT up 11.2 percent at Rs 78.4 crore.
• Margin at 8.6 percent from 7.7 percent.

Music Broadcast Q3 (YoY)

• Revenue up 4 percent at Rs 76 crore.
• Net profit up 20 percent at Rs 12 crore.
• EBITDA down 13 percent at Rs 23.5 crore.
• Margin at 30.9 percent from 37 percent.

Quess Corp Q3 (YoY)

• Revenue up 48.5 percent at Rs 1,584 crore.
• Net profit up 106 percent at Rs 70 crore.
• EBITDA up 54 percent at Rs 91 crore.
• Margin at 5.7 percent from 5.5 percent.

Container Corporation of India Q3 (YoY)

• Revenue up 25 percent at Rs 1,640 crore.
• Net profit up 55 percent at Rs 289 crore.
• EBITDA up 71.5 percent at Rs 446 crore.
• Margin at 27.2 percent from 19.8 percent.

Pidilite Q3 (YoY)

• Revenue up 16 percent at Rs 1,543 crore.
• Net profit up 19 percent at Rs 240 crore.
• EBITDA up 29 percent at Rs 370 crore.
• Margin at 24 percent from 21.5 percent.

Raymond Q3 (YoY)

• Revenues up 14 percent at Rs 1484 crore.
• Net profit at Rs 29 crore.
• EBITDA up 74 percent at Rs 101.6 crore.
• Margins at 6.8 eprcent versus 4.4 percent.

KEI Industries Q3 (YoY)

• Revenues up 25 percent at Rs 889 crore
• Net profit up 50 percent at Rs 39 crore.
• EBITDA up 9.5 percent at Rs 84 crore.
• Margin at 9.5 percent versus 10.75 percent.

Sagar Cements Q3 (YoY)

• Revenue up 30 percent at Rs 249 crore.
• Net profit of Rs 3 crore from a loss Rs 0.5 crore.
• EBITDA up 7 percent at Rs 31 crore.
• Margin at 12.4 percent from 15.2 percent.

Mphasis Q3 (QoQ)

• Revenue up 3.5 percent at Rs 1,661 crore.
• Net profit up 9 percent at Rs 215 crore.
• EBIT up 11 percent at Rs 257 crore.
• Margin at 15.5 percent from 14.5 percent.

TT Ltd Q3 (YoY)

• Revenue down 28 percent at Rs 140 crore.
• Net profit up 33 percent at Rs 0.8 crore.
• EBITDA up 5 percent at Rs 11 crore.
• Margin at 7.9 percent from 5.4 percent.

Genus Power Infrastructures Q3 (YoY)

• Revenue up 9 percent at Rs 200 crore.
• Net profit up 8 percent at Rs 13 crore.
• EBITDA down 17 percent at Rs 19 crore.
• Margin at 9.5 percent from 12.6 percent.

Liberty Shoes Q3 (YoY)

• Revenue up 28 percent at Rs 163 crore.
• Net profit up 145.5 percent at Rs 2.7 crore.
• EBITDA up 10 percent at Rs 11 crore.
• Margin at 6.7 percent from 7.9 percent.

Bharat Bijlee Q3 (YoY)

• Revenue up 34.5 percent at Rs 228 crore.
• Net profit at Rs 9.65 crore.
• EBITDA at Rs 14 crore.
• Margin at 6.1 percent from 4.4 percent.

Geojit Financial Services Q3 (YoY)

• Revenue up 36 percent at Rs 91 crore.
• Net profit up 40 percent at Rs 21 crore.

Siti Networks Q3 (YoY)

• Revenue up 20 percent at Rs 357.5 crore.
• Net loss of Rs 37 crore from a loss of Rs 26 crore.
• EBITDA up 28 percent at Rs 70.5 crore.
• Margin at 19.7 percent from 18.4 percent.

Everest Industries Q3 (YoY)

• Revenue up 16.4 percent at Rs 291 crore.
• Net profit of Rs 9.4 crore from a loss of Rs 14 crore.
• EBITDA at Rs 18 crore.
• Margin at 6.2 percent from -4 percent.

Orient Green Power Q3 (YoY)

• Revenue up 2 percent at Rs 56 crore.
• Net loss of Rs 51 crore from a loss of Rs 69.5 crore.
• EBITDA down 1.5 percent at Rs 33 crore.
• Margin at 58.9 percent from 60.9 percent.

For a complete list of stocks to watch, click here

• Apollo Pipes: Canara HSBC OBC Life Insurance bought 83,489 shares or 0.8 percent equity at Rs 640 each.
• Indoco Remedies: India Whizdom Fund sold 5 lakh shares or 0.5 percent equity at Rs 280.01 each.
• Foods & Inns: Promoter Shital P Dalal bought 10,000 shares or 0.6 percent equity at Rs 1250 each.
• HDIL: Acadian Asset Management's Emerging Markets Small Cap Equity Fund LLC sold 24.86 lakh shares or 0.6 percent equity at Rs 59.97 each.
• Hi-Tech Pipes: Girik Wealth Advisors Pvt Ltd PMS bought 2.81 lakh shares at Rs 350.05 each.

• Nifty January futures trading at 11,083, discount of 2.8 points versus premium of 1.7 points.
• Nifty February futures trade at 11,105, premium of 19 points versus 24 points.
• Across series: Nifty open interest up 2 percent, Bank Nifty open interest up 3 percent.
• India VIX ended at 18, up 11 percent.
• Rollover: Nifty at 41 percent, Bank Nifty at 49 percent.
• Max open interest for February series at 10,800 Call (open interest at 21.1 lakh, up 3 percent).
• Max open interest for February series at 10,500 Put (open interest at 39.9 lakh, up 1 percent).

Emkay on L&T Finance Holding

• Initiated ‘Buy’ with price target of Rs 250; implying a potential upside of 39 percent from last regular trade.
• Diversified Financial Services players best positioned in current landscape.
• Lending business successfully turned around; Now on strong growth footing .
• Retailisation of balance sheet and P&L underway.
• Fee engine is firing and is likely to be sustainable.
• Return on equity drag from wholesale business likely to end.
• Expect steady move in return on equity towards 20 percent by March 2020
• Expect consolidated net profit to compound at 32 percent over the financial years through March 2020.
• See further scope for valuation re-rating with improving return ratios.

Macquarie on L&T Infotech

• Maintained ‘Outperform’; raised price target to Rs 1,600 from Rs 1,200.
• Revenue growth momentum strong with all around delivery.
• Deal pipeline and go-to market strategy to keep revenue momentum strong.
• Expect LTI to post 12-15 percent year-on-year growth in $ revenues over fiscal 2018-2020, faster than industry.
• L&T Infotech is top pick in the midcap IT space.

IIFL on Himadri Speciality

• Initiated ‘Buy’ with price target of Rs 240; implying a potential upside of 32 percent from last regular trade.
• Strong competitive position in base business.
• High-margin new products are key growth drivers.
• New products to add Rs 500 crore to operating income by March 2023.
• Integrated manufacturing, R&D capabilities are key strengths.
• Positives: strong earnings growth, high return ratios and margins.
• Expect EPS to grow compound at 40 percent over Fiscal 2018-2020 and 28 percent over Fiscal 2018-2023.
• Expect Himadri to continue to command premium valuations.

Credit Suisse on Idea Cellular

• Maintained ‘Underperform’; cut price target to Rs 65 from Rs 70.
• Sharp decline in operating income continues.
• Competitive pressures imply this could continue.
• Idea to not participate in the ongoing tariff wars.
• Recently announced capital infusion to be consumed in 5-6 quarters.
• Leverage ratio of combined entity to remain at an uncomfortable 7.8 times.

HSBC on Idea Cellular

• Maintained ‘Reduce’; cut price target to Rs 75 from Rs 78.
• Q3FY18 revenues lower than Jio’s.
• Strategy to ring-fence 2G subs may not work.
• Idea’s 2G/3G focus is vulnerable as Jio and Bharti driving 4G take-up.
• Key catalyst lies in expediting merger approvals and advancing merger benefits.

Edelweiss on InterGlobe Aviation

• Upgraded to ‘Buy’ from ‘Hold’; raised price target to Rs 1,655 from Rs 1,378.
• December Quarter Results’ Takeaways: Yield improvement extends; NEO resolution on-track.
• Expect robust 20 percent compounded growth rate in volume over the financial years through March 2020.
• Rising oil price is a concern, but ramp-up of NEOs to moderate the impact.
• Cash balance vs. net debt of peers, reduces operational vulnerability against severe oil shocks.

Credit Suisse on InterGlobe Aviation

• Maintained ‘Outperform’ with price target of Rs 1,650.
• December Quarter takeaway: Strong yields and seat factors help drive earnings growth.
• Result reflects crude price of $60/bbl.
• Full impact of rise in crude to get reflected in coming quarters.
• Fleet addition continues at a strong pace with total fleet at 153.
• Indigo has superior positioning and relatively attractive valuations.

Macquarie on Mahindra Finance

• Maintained ‘Neutral’; raised price target to Rs 465 from Rs 345.
• December quarter’s net profit was double the expectations.
• Asset quality improved QoQ, but AUM growth remained modest.
• Recoveries picking up as rural economy showing signs of revival.
• Mahindra Finance has been readying itself for upcoming growth through expansion.
• Only growth can drive a further re-rating for the stock.

JPMorgan on Mahindra Finance

• Maintained ‘Underweight’ with price target of Rs 230.
• Asset quality improved during previous quarter.
• Beat largely driven by declining NPA trend, better NIMs and lower provisioning.
• Quarter reflects better-than-expected rural recovery.
• Management sounds optimistic for coming quarters.

Nomura on Container Corp

• Maintained ‘Neutral’ with price target of Rs 1,324.
• Headline numbers robust but weak underlying.
• Operating income missed largely on account of unusually high employee expenses.
• Underlying segmental margins also affected.

JPMorgan on Container Corp

• Maintained ‘Overweight’ with price target of Rs 1,750.
• Revenue beat estimates in previous quarter; Higher employee costs surprise.
• Employee costs dragged down margins; RM/Other expenses showed improvement.
• EXIM segment saw good revenue growth.
• Domestic segment volume momentum continues.

Deutsche Bank on Canara Bank

• Maintained ‘Sell’ with price target of Rs 305.
• Q3FY18: Better loan growth; Stable NIM and asset quality.
• Core trends improved in previous quarter; Slippages decline.
• NIMs improve QoQ, Fee income weak, CASA ratio stable.
• Asset quality better, but still a long way to go.

Morgan Stanley on Mphasis

• Maintained ‘Overweight’ with price target of Rs 830.
• December quarter results were better than expectations.
• Growth was broad-based across Direct International and HP/DXC channels.
• New deal wins were healthy during the quarter.
• Revenues helped by better than expected hedge gains and one-time settlement.

Jefferies on Petronet LNG

• Upgraded to ‘Buy’ from ‘Hold’; price target remained unchanged at Rs 290.
• Firm near term; Solid long term & valuations less stretched.
• Expect Dahej to operate near capacity with imports likely to rise at Kochi.
• Near-term macro is resilient too.
• Domestic gas output fell while LNG imports rose in the previous quarter.

JPMorgan on Pidilite Industries

• Maintained ‘Neutral’ with price target of Rs 840.
• Strong December quarter: Second consecutive quarter of revenue beat.
• Pleasantly surprised by strong growth recovery and margin resilience.
• Underlying volume mix growth of 22 percent is big positive.
• December quarter’s growth was led by GST stabilisation, demand improvement and benign base.

JP Morgan

• About 60 percent of the capital allocation is biased toward weaker banks requiring corrective action, thus, limiting access to growth capital for larger banks.
• Loan growth recovery is likely to be delayed, probably after March 2019, as the larger banks would lack the growth capital.
• For the banks within coverage, see a capital shortfall of 59-72 percent.
• Focus on SME would raise long-term risks.
• Recommend investors switch out of PSU banks into relatively well-capitalized private high NPL banks that are better positioned for growth.
• Axis bank is our top value pick.

Macquarie

• The recap plan of about Rs 2 lakh crore is likely short by Rs 50,000 crore to meet provisioning requirement and move to IFRS by March 2019.
• The first tranche is skewed towards bailouts than growth.
• Hope that the next tranche is concentrated to a few large, disciplined banks with improving processes and governance.
• BOI receives disproportionately more, SBI receives far less than estimated
• While BOI gets much more capital (near term +ve), this increases dilution and thus delays RoE mean reversion that much more.
• Maintain Axis and ICICIBC as the best plays for the recovery theme.
• Among PSU banks, we like only SBI and would continue to avoid all other PSU banks.

Credit Suisse

• Infusion will translate into a 5-100 percent equity dilution and improve CET-1 by 50-500 basis points.
• Estimate that 55 percent of this recap amount will be used up for provisioning and meeting Basel-III capital requirements and about $6 billion would be available as “growth capital.”
• Continue to prefer SBI, BOB and PNB among PSU lenders.

Motilal Oswal

• CET1 ratio for all PSU banks would reach above 8.5% percent.
• Net stressed assets reducing to 102 percent of net worth from 117 percent earlier.
• SBI and BoB remain our top picks within the PSU banking space.

Commodities

• West Texas Intermediate crude surged 2.2 percent Wednesday to $65.88 a barrel, the highest in more than two years on the biggest jump in a month.
• Gold increased less than 0.05 percent to $1,358.54 an ounce Thursday, hitting the highest in almost 18 months with its sixth consecutive advance.
• LME copper surged 3.3 percent to $7,150.00 per metric ton, the biggest jump since October.