Sensex, Nifty Clock Best Week In Over A Month Led By RIL

Whistle blower documents are so explosive that I was not able to believe large parts of it, Debashish Basu, founder and editor of MoneyLife told BloombergQuint in an interview.

Key highlights of the conversation:

• No idea of what institutional shareholders have done with Sun Pharma shares
• Eight to 10 people have visited us to see documents and which included pharma sector analysts as well
• There are huge governance issues which have shocked and surprised me
• Money from public held company is going to Aditya Medisales which is a promoter driven entity
• Found a lot of things which pertains to real estate and buying distressed assets
• The issue is about governance and not about plants operated by Sun Pharma

• Alembic Pharma: The Vadodara-based drug maker rose as much as 3.82 percent to Rs 614. Trading volume was more than 40 times its 20-day average.
• Future Lifestyle: The Mumbai-based apparel retail stores operator rose as much as 7.43 percent to Rs 419.35. Trading volume was 30 times its 20-day average.
• Cyient: The Hyderabad-based engineering services provider fell as much as 8.6 percent to Rs 575.25. Trading volume was 19 times its 20-day average.
• Varroc Engineering: The Aurangabad-based auto parts maker rose as much as 0.77 percent to Rs 722.45. Trading volume was 16 times its 20-day average.

BQ Edge | Clouds Gather Over Sun TV’s Shares

Shares of Wipro fluctuated between gains and losses to trade a little changed at Rs 335.70 ahead of its quarterly results announcement for the October-December period.

Here’s what analysts tracked by Bloomberg expects Wipro to report for the December quarter on a sequential basis:

• IT services revenue seen up 1.4 percent at $2070 million.
• Revenue seen up 4.1 percent at Rs 15,167 crore.
• EBIT seen up 23 percent at Rs 2,577 crore.
• EBIT margin at 17 percent versus 14.4 percent.
• Net Profit seen up 22.6 percent at Rs 2,313 crore.

Shares of the country's largest FMCG company fluctuated between gains and losses to trade 0.4 percent lower at Rs 1,744.50.

The company delivered double digit volume growth for the fifth straight quarter (more details here).

Key earnings highlights (Q3, YoY)

• Revenue up 11.3 percent at Rs 9,558 crore.
• Net profit up 8.9 percent at Rs 1,444 crore.
• Ebitda up 21.8 percent at Rs 2,046 crore.
• Margin at 21.4 percent versus 19.6 percent.
• Volume growth at 10 percent.

Here's what analysts had to say after the company announced its quarterly results:

CLSA

• Maintained ‘Outperform’ with a price target of Rs 2,010.
• Overall earnings in-line with our forecasts.
• Volume growth of 10 percent is commendable.
• Tougher base from hereon – execution is strength.

Macquarie

• Maintained ‘Outperform’; cut price target to Rs 2,059 from Rs 2,086.
• Like focus on driving higher penetration in categories which are leading superior volume growth.
• Cut earnings estimate by 1-2 percent on lower pricing and other income assumptions.
• Demand environment stable with rural demand at 1.3 times of urban.

UBS

• Maintained ‘Neutral’ with a price target of Rs 1,800.
• December quarter review: Good volume growth, but profit miss.
• Management cautioned about one-off costs post completion of GSK acquisition.
• See EPS upgrades post Horlicks deal, still valuating impact on stock valuations.

The Nexus Between Sun Pharma, Aditya Medisales And Dilip Shanghvi

Shares of Reliance Industries rose as much as 2 percent to Rs 1,157.10.

The Mukesh Ambani-led company’ standalone profit rose 0.8 percent over the previous three months to Rs 8,928 crore in the quarter ended December, according to its stock exchange notification.(More details here)

Key highlights (Q3, QoQ)

• Revenue up 4 percent to Rs 1,00,096 crore.
• Net profit up 0.8 percent to Rs 8,928 crore.
• Ebitda down 2.6 percent to Rs 14,507 crore.
• Ebitda margin at 14.5 percent versus 15.5 percent.
• GRM down 7.4 percent to $8.8 a bbl versus $9.5.

Reliance Jio (Q3, QoQ)

• Revenue up 12 percent to Rs 10,383 crore.
• Net profit up 22 percent to Rs 831 crore.
• Ebitda up 13.4 percent to Rs 4,052 crore.
• Ebitda margin at 39 percent versus 38.7 percent.
• ARPU down 1.5 percent to Rs 130.

Here's what analsyts had to say after the company announced their quarterly results:

UBS

• Maintained ‘Sell’ with a price target of Rs 1,070.
• Petchem better than expectations; other income driven beat.
• Expect investors to look positively at increasing contribution from RIL's consumer businesses, robust performance in petchem and GRM.

Macquarie

• Maintained ‘Outperform’ with a price target of Rs 1,315.
• Petchem was the key positive surprise, while refining, Jio, and retail were in line.
• Expect RIL’s refining margins to strengthen to $15, $20 and $18 in the next three financial years respectively.
• See upside risk to consensus’ earnings estimates.

Edelweiss

• Maintained ‘Buy’ with a price target of Rs 1,415.
• Consumer and petchem shine; lower opex offsets lower GRM.
• Demerger of non-core telecom assets could prove to be a game changer.
• Multiple triggers: petcoke gasifier on schedule for March 2019 and an imminent FTTH roll out.

Prabhudas Lilladher

• Maintained ‘Accumulate’ with a price target of Rs 1,238.
• Stellar petrochemicals performance make up for weak refining earnings.
• RIL with high complexity well placed to capitalise benefits of IMO 2020.
• Maintain rating as we await clarity on petcoke commercialisation.

Here's quick look at the corporate insider trades reported on Thursday.

Read: https://t.co/r3L9wDFELa pic.twitter.com/JZnbqwqYRq

— BloombergQuint (@BloombergQuint) January 18, 2019

F&O Cues

• Nifty January futures closed trading at 10,926, premium of 20 points.
• Max open interest for January series at 11,000 strike value call (open interest at 37.9 lakh shares).
• Max open interest for January series at 10,500 strike value put (open interest at 38.3 lakh shares).

Stocks In F&O Ban

• Adani Power
• Jet Airways

Put-Call Ratio

• Nifty PCR at 1.52 versus 1.54.
• Nifty Bank PCR at 1.09 versus 0.99.

CLSA on L&T Technology

• Maintained ‘Buy’ with a price target of Rs 2,100.
• December quarter review: Stellar growth, margins beat and strong outlook.
• Large deals ramping-up, pipeline healthy & mining strong but one client issue.
• See more scope margin improvement; increase estimates by 30-40 basis points.

On HUL

CLSA

• Maintained ‘Outperform’ with a price target of Rs 2,010.
• Overall earnings in-line with our forecasts.
• Volume growth of 10 percent is commendable.
• Tougher base from hereon – execution is strength.

Macquarie

• Maintained ‘Outperform’; cut price target to Rs 2,059 from Rs 2,086.
• Like focus on driving higher penetration in categories which are leading superior volume growth.
• Cut earnings estimate by 1-2 percent on lower pricing and other income assumptions.
• Demand environment stable with rural demand at 1.3 times of urban.

UBS

• Maintained ‘Neutral’ with a price target of Rs 1,800.
• December quarter review: Good volume growth, but profit miss.
• Management cautioned about one-off costs post completion of GSK acquisition.
• See EPS upgrades post Horlicks deal, still valuating impact on stock valuations.

On RIL

UBS

• Maintained ‘Sell’ with a price target of Rs 1,070.
• Petchem better than expectations; other income driven beat.
• Expect investors to look positively at increasing contribution from RIL's consumer businesses, robust performance in petchem and GRM.

Macquarie

• Maintained ‘Outperform’ with a price target of Rs 1,315.
• Petchem was the key positive surprise, while refining, Jio, and retail were in line.
• Expect RIL’s refining margins to strengthen to $15, $20 and $18 in the next three financial years respectively.
• See upside risk to consensus’ earnings estimates.

Edelweiss

• Maintained ‘Buy’ with a price target of Rs 1,415.
• Consumer and petchem shine; lower opex offsets lower GRM.
• Demerger of non-core telecom assets could prove to be a game changer.
• Multiple triggers: petcoke gasifier on schedule for March 2019 and an imminent FTTH roll out.

Prabhudas Lilladher

• Maintained ‘Accumulate’ with a price target of Rs 1,238.
• Stellar petrochemicals performance make up for weak refining earnings.
• RIL with high complexity well placed to capitalise benefits of IMO 2020.
• Maintain rating as we await clarity on petcoke commercialisation.

Nifty Earnings To Watch

• Wipro

Other Earnings To Watch

• Atul
• Dhanlaxmi Bank
• ICICI Lombard General Insurance
• Kajaria Ceramics
• Larsen & Toubro Infotech
• MPS
• MT Educare
• Muthoot Capital Services
• NIIT Technologies
• SBI Life Insurance Company
• Zee Learn
• TGV Sraac
• Ugro Capital

Earnings Reaction To Watch

Reliance Industries (Q3, QoQ)

• Revenue up 4 percent to Rs 1,00,096 crore.
• Net profit up 0.8 percent to Rs 8,928 crore.
• Ebitda down 2.6 percent to Rs 14,507 crore.
• Ebitda margin at 14.5 percent versus 15.5 percent.
• GRM down 7.4 percent to $8.8 a bbl versus $9.5.

Also Read: Q3 Results: Reliance Industries Beats Estimates Even As Refining Margin Falls

Reliance Jio (Q3, QoQ)

• Revenue up 12 percent to Rs 10,383 crore.
• Net profit up 22 percent to Rs 831 crore.
• Ebitda up 13.4 percent to Rs 4,052 crore.
• Ebitda margin at 39 percent versus 38.7 percent.
• ARPU down 1.5 percent to Rs 130.

Also Read: Q3 Results: Reliance Jio Profit Surges On Higher Subscriber Base

Hindustan Unilever (Q3, YoY)

• Revenue up 11.3 percent at Rs 9,558 crore.
• Net profit up 8.9 percent at Rs 1,444 crore.
• Ebitda up 21.8 percent at Rs 2,046 crore.
• Margin at 21.4 percent versus 19.6 percent.
• Volume growth at 10 percent.

Also Read: Q3 Results: HUL Delivers Double Digit Volume Growth For Fifth Straight Quarter

L&T Technology Services (Q3, YoY)

• Revenue up 35.9 percent at Rs 1,316.9 crore.
• Net profit up 47 percent at Rs 185.6 crore.
• Ebitda up 63 percent at Rs 241.7 crore.
• Margin at 18.4 percent versus 15.3 percent.

Cyient (Q3, QoQ)

• Revenue flat at Rs 1,188 crore.
• Net profit down 27 percent at Rs 92.3 crore.
• EBIT up 11.1 percent at Rs 137.7 crore.
• Margin at 11.6 percent versus 10.4 percent.
• Other income of Rs 56.9 crore in base quarter.

AU Small Finance Bank (Q3, YoY)

• Net Interest Income up 38.9 percent at Rs 347.9 crore.
• Net profit up 20.8 percent at Rs 95.3 crore.
• Provisions at Rs 32.5 crore.
• GNPA at 2.09 percent versus 2.03 percent.
• NNPA at 1.31 percent versus 1.28 percent.

Rallis India (Q3, YoY)

• Revenue up 7 percent at Rs 417.4 crore.
• Net profit down 44.6 percent at Rs 13.9 crore.
• Ebitda down 26.7 percent at Rs 27.7 crore.
• Margin at 6.6 percent versus 9.7 percent.
• Materials cost up 43 percent at Rs 281.6 crore.

• Aurobindo Pharma’s U.S. arm entered into an agreement to acquire seven marketed oncology injectable products, intellectual property and commercial infrastructure from Spectrum Pharma.
• Sundram Fasteners said that its plant located at Mahindra World City’s SEZ unit in Tamil Nadu had started its commercial production from Jan. 16.
• Bajaj Holdings & Investments received the Supreme Court’s nod to acquire 27 percent stake in Maharashtra Scooters. The company will acquire 30.85 lakh shares from the scooter company’s promoter Western Maharashtra Development Corporation.
• Rallis Industries board approved the merger of its wholly owned arm Metahelix Life Sciences with self.
• IL&FS Transportation said that its tunnel contract in Jammu Kashmir was terminated by NHIDCL with effect from Jan. 15.
• Great Eastern Shipping contracted to sell its large gas carrier and will be delivered to new buyer in the first half of financial year 2020.
• Cyient said it will consider a share buyback on a later date.
• Axis Bank clarified on news relating to Hawala Scam stating accounts have been opened after complying with KYC norms and the bank does not have any credit exposure to the said entity. The bank also stated that it was working closely with the authorities on this issue.
• Hindalco clarified that the company had stopped its mining operation at Durgamandi Mines since March 17 last year, as per the show-cause notice received from the Ministry of Environment Forest and Climate Change. This closure will not have material impact in the operations, as state in the press release.
• UCO Bank board approved the issue of equity shares on a preferential basis worth Rs 3,076 crore to the government of India and raising of Rs 1,000 crore via equity through qualified institutional placement.