Sensex, Nifty Log Second Worst Week In Two Months

"At present, the Index has support at 16,830 levels while resistance comes at 17,450 levels, crossing either side can suggest further direction. On the other hand, Bank nifty has support at 37,000 levels while resistance at 38,500 levels", said Palak Kothari, Research Associate at Choice Broking.

"All eyes are on the Union Budget now. We expect a growth-friendly budget but also expect the government to lay out a path for fiscal consolidation. Besides, earnings and global cues would remain on participants’ radar. We reiterate our cautious view and suggest continuing with hedged positions", Ajit Mishra, VP - Research, Religare Broking Ltd. wrote in a note

Vedanta reported net income for the third quarter that missed the average analyst estimate.

December Quarter Numbers (Consolidated)

• Net income at Rs 4,164 crore vs Rs 4,616 crore QoQ (Bloomberg consensus estimate: Rs 4,832 crore)

• Revenue at Rs 33,697 crore vs Rs 30,048 croore QoQ (Estimate: Rs 33,212 crore)

• Total costs at Rs 26,845 crore vs Rs 23,222 crore QoQ

• Other income at Rs 577 crore vs Rs 673 crore QoQ.

Source: Exchange Filing

Dr. Reddy's Laboratories Ltd. reported net income for the quarter-ended December that missed the average analyst estimate.

Third Quarter Results (Consolidated, YoY)

• Revenue up 8% at Rs 5,338.3 crore Vs Rs 4,941.9 crore (Bloomberg consensus estimate : Rs 5,456.2 crore)

• Net profit up 2442% to Rs 709.3 crore from Rs 27.9 crore (Estimate : Rs 742.6 crore)

• Ebitda grew 1.25 times to Rs 1,215.7 crore from Rs 539.3 crore (Estimate : Rs 1,220.6 crore)

• Margins at 22.8% Vs 10.9% (Estimate : 22.4%)

• EPS at Rs 42.75 per share Vs Rs 1.68 (Estimate : Rs 44.52)

The company conducted trials for Sputnik light and are also developing several other covid-related drugs for treatment ranging from mild to severe conditions.

Of the 42 analysts tracking the company, 36 maintained 'buy', five maintained 'hold' and one maintained 'sell' recommendations. The overall consensus price of analysts tracked by Bloomberg implied an upside of nearly 28%.

Source: Exchange Filing, Bloomberg

• Embassy REIT reported distribution per unit for the third quarter of Rs 5.20 vs Rs 4.55 YoY.

• Net operating income in Q3 at Rs 621 crore, up 30% YoY

Commentary & Context

• Company raises full-year net operating income by 3%.

• Full-year net operating income at Rs 2,450 crore.

• Company also raises full-year distribution/unit guidance.

Source: Bloomberg, Exchange Filing

• All approvals, including from RBI, received.

• NARCL will aggregate bad assets from banks and IDRCL will manage these assets under exclusive arrangement.

• The arrangement will be on principal-agent basis.

• Arrangement will comply with applicable regulatory guidelines at all times.

• Public sector banks have taken majority equity stake in NARCL.

• We plan to acquire the identified assets on a 15:85 structure.

• The security receipts will be secured by the government.

• Both companies have their respective boards in place and MD & CEOs have been appointed for both.

• Rs 50,000 crore worth assets will be transferred to NARCL in phase 1 this fiscal.

• All the issues have been ironed out and appropriately addressed.

• The main difference between existing ARCs and NARCL is the government guarantee.

• In private ARCs, there is no committed arrangement with a resolution agency.

• This will ensure quick resolution of the problems.

• Joint lender forums of various assets have already agreed to transfer of assets.

• There will be 15 accounts transferred in the first phase.

• Some of the assets identified by us previously have been resolved.

• An auction process and a Swiss challenge will need to be conducted before the transfer.

• A total of 28 accounts worth Rs 83,000 crore will be transferred to NARCL.

• The Rs 2 lakh crore pool of assets identified previously still remains under consideration.

• The decision to transfer these accounts or to resolve them internally will be taken next year.

• The assets identified for transfer are fully provided for.

• When it comes to the ability to resolve the account, IDRCL will have full freedom.

Source: SBI conference call

The broader indices outperformed their larger peers with both the S&P BSE MidCap and S&P BSE SmallCap gaining over 2.5%. All the 19 sectoral indices compiled by BSE Ltd. advanced with S&P BSE Realty gaining over 3%.

The market breadth was skewed in the favour of bulls. About 2,499 stocks advanced, 785 declined and 89 remained unchanged.

Air India Seeks to End $1.2 Billion U.S. Case Citing New Owner

• Reliance Industries Ltd. has another 1.22 million shares change hands in a large trade.

• Details of buyers, sellers are not known immediately

• About 1.2 million shares of RIL changed hands in a large trade earlier in the session

Source: Bloomberg

Maturities across the India sovereign yield curve were little changed in Friday morning trading.

• The 5-year yield fell 0.9bps to 5.972%

• The 10-year yield fell 0.9bps to 6.738%

• The 18-year yield remained unchanged at 7.133%

• The 5-year-10-year yield spread was 76.6bps, vs previous close 76.5bps

• The NSE Nifty 50 Index rose 1.3%

Source: Bloomberg

Madras High Court Orders Winding Up Of SpiceJet, Grants Three-Week Stay For Appeal

• Reliance Industries Ltd. has 1.2 million shares change hands in a large trade.

• Details of buyers, sellers are not known immediately.

Source: Bloomberg

Larsen & Toubro Ltd.'s subsidiary L&T Hydrocarbon Engineering Ltd. secured a 'large' contract from ONGC for the seventh development phase of their pipeline replacement projects.

• The order value is in the range of Rs 2,500 crore-Rs 5,000 crore.

• Shares of Larsen & Toubro rose nearly 1.5% in intraday trade. Trading volume on the stock is nearly twice the 30-day average volume, at this time of the day.

• The company is set to announce its December-quarter earnings today.

• Of the 43 analysts tracking the company, 41 maintained 'buy', one maintained 'hold' and one maintained 'sell' recommendations. The overall consensus price of analysts tracked by Bloomberg implied an upside of 16.3%.

Source: Exchange Filing

The broader markets outperformer theire larger peers with the S&P BSE MidCap rising 1.4% and S&P BSE SmallCap gaining 1.6%. All the 19 sectoral indices compiled by BSE Ltd. advanced with S&P BSE Telecom gaining over 2.3%.

The market breadth was skewed in the favour of bulls. About 2,010 stocks advanced, 564 declined and 67 remained unchanged.

As part of its Google for India Digitization Fund, Google will invest $700 million to acquire 1.28% ownership in Airtel.

• It will invest up to $300 million toward potential multi-year commercial agreements.

• The partnership will focus on enabling affordable access to smartphones across price ranges.

• This deal will be subject to necessary regulatory approvals.

Source: Exchange filing

• Blackstone launches Horizon Industrial Parks, a portfolio of logistics parks in India, company says in a statement.

• Portfolio has been assembled through a number of investments including Embassy Industrial Parks, TARC, and Allcargo.

Source: Bloomberg

Piramal Enterprises Ltd. said that the DHFL acquisition by the group remains unaffected and the business integration continues as envisaged.

• The comments come after most appeals filed before the NCLAT against Piramal's approved DHFL resolution plan were disposed off on Thursday.

• With regard to NLCAT's order on an appeal challenging the distribution of proceeds from fraudulent transactions to the benefit of resolution applicant, Piramal Enterprises said that it will pursue the matter as multiple legal options are available.

• Piramal Capital & Housing Finance acquired DHFL for Rs 34,250 crore in September 2021.

Source: Exchange Filing

• United Spirits raised to 'buy' from 'hold' at Investec; price target set at Rs 1,006.

• Mahindra Logistics cut to 'reduce' from 'hold' at ICICI Securities; price target set at Rs 563.

Source: Bloomberg

• Macrotech Developers Ltd. reinstated as 'neutral' at JPMorgan; price target set at Rs 1,200.

• RBL Bank raised to 'reduce' from 'sell' at Spark Capital Advisors; price target set at Rs 143.

• Pidilite Industries cut to 'reduce' from 'add' at Spark Capital Advisors; price target set at Rs 2,400.

Source: Bloomberg

India's bond traders are awaiting a weekly debt sale which includes the new 10-year paper. The rupee is headed for its biggest five-day drop since October.

• RBI to hold Rs 5 lakh crore rupee 14-day reverse repo auction on Friday.

• USD/INR rose 0.4% to 75.0688 on Thursday, taking its gain so fair this week to 0.9%.

• 10-year yields rose 9bps to 6.75% on Thursday, highest since Dec. 2019.

• Global funds sold a net Rs 6,270 crore of India stocks Thursday: NSE

• They sold Rs 433 crore of sovereign bonds under limits available to foreign investors, and withdrew Rs 72 crore of corporate debt.

• State-run banks bought Rs 885 crore of sovereign bonds on Jan. 27: CCIL data. Foreign banks sold Rs 332 crore of bonds.

Source: Bloomberg

Vedanta Ltd. raised Rs 8,000 crore secured term loan from Union Bank of India at 7.75% in December, Economic Times reported citing people familiar with the matter.

• The company raised new loan by pledging its Hindustan Zinc shares.

• It used the proceeds to prepay debt raised at over 10% two years ago.

• Vedanta and Union Bank of India did not respond to requests for comments: ET.

• TVS Motor: Has acquired 75% stake in the Swiss E-Mobility Group at 525.58 CHF (Swiss Franc) on cash consideration. It plans to acquire the balance 25% stake in SEMG by next year.

• Centrum: The company’s step down subsidiary Unity Small Finance Bank took charge of 110 branches of PMC Bank. Unity Small Finance Bank will immediately repay 96% of PMC Bank's depositors who have deposits worth Rs 5 lakh or less. The banks’ shareholders have committed capital of over Rs 3,000 crore through cash and warrants.

• Lupin: Has entered a promotional agreement with Exeltis USA Inc.to promote Solosec, along with Exeltis’ existing line of women’s health products.

• Motilal Oswal: Declared interim dividend of Rs 7 per share.

• Kirloskar Oil Engines: Has appointed Gauri Kirloskar to supervise day-to-day operations for the interim period as managing director Sanjeev Nimkar has resigned.

• Jubilant Ingrevia: Will consider declaration of interim dividend on Feb. 1.

• Advanced Enzyme Technologies: The company’s subsidiary SciTech Specialities has approved investment in Vecteng SciTech, South Africa by acquiring 14% of paid-up share capital of Vecteng for Rs 10.9 lakh ($14,500).

• Sandhar: Entered a shareholders agreement with Kwangsung Corp., Kwangsung Sandhar Technologies and Kwangsung Sandhar Automotive Systems for acquisition of equity shares in the 50:50 ratio of fresh issue.

• Jubliant Foodworks: The acquisition of additional 39% stake in JGHL from Golden Harvest QSR by the company is now likely to be completed by April 27, 2022.

• Accelya: Declared interim dividend of Rs 17 per share.

• Kewal Kiran Clothing: Declared second interim dividend of Rs 4 apiece.

• Earnings Today: Atul, Asahi India Glass, AU Small Finance Bank, Bharat Electronics, Blue Dart Express, Britannia Industries, CARE Ratings, Central Bank of India, Century Plyboards India, Chambal Fertilisers and Chemicals, Crompton Greaves Consumer Electricals, Deepak Fertilisers & Petrochemicals, Dixon Technologies, Dr Reddy's Laboratories, Equitas SFB, Great Eastern Shipping, Gujarat State Fertilisers and Chemicals, Happiest Minds, Info Edge India, Larsen & Toubro, Max Financial Services, Marico, Oberoi Realty, United Breweries, Vedanta