12:10 pm Buzzing: Adani Power shares fell as much as 4 percent intraday after foreign brokerage house Citi discontinued its coverage on the stock.
“We are discontinuing coverage on Adani Power due to reallocation of our resources. The firm’s last recommendation for the stock is sell and our target price is Rs 23. This is our last rating on Adani Power,” the research house said.
In its last recommendation, Citi slashed its target price on the stock Rs 23 (from Rs 25 earlier) to factor in EPS revision and increase in target Price-to-book value to 3.0x (1.0x earlier) as it was more comfortable with the book value post Mundra write off in Q4FY17.
It had revised down FY19-20 EPS by 74-99 percent and FY18 estimates is now a loss (against profits earlier) as it cut sales by 6-10 percent and EBITDA by 24-27 percent over FY18-20 on lower than expected FY17 results.
“We will not provide updates to our previous research or ratings. You should not rely on this or previous research with respect to this company going forward,” Citi said.
11:55 am Market Check: Benchmark indices remained strong, with the Sensex rising as much as 290 points in late morning trade and Nifty Bank hit 25,000-mark for the first time.
The 30-share BSE Sensex was up 246.26 points at 32,628.72 and the 50-share NSE Nifty gained 77.30 points at 10,097.95 despite weak market breadth.
About 1,239 shares declined against 1,108 advancing shares on the BSE.
HDFC was the biggest gainer, up 4 percent as Bank of America Merrill Lynch maintained its buy rating on the stock and raised target price to Rs 1,925 after strong earnings.
11:40 am Bihar political drama: Mahesh Nandurkar of CLSA said Bihar CM, Nitish Kumar resigning has increased chances for PM Modi’s win in the 2019 elections and has also reduced the risk of heightened populism by Modi ahead of the elections.
In general, this should boost investor sentiment.
11:20 am Market Outlook: Gautam Duggad of Motilal Oswal said the Indian market remained buoyed by continued liquidity inflow amid a strong macro backdrop.
Domestic MF inflows in CY17 stand at USD 7 billion, matching inflows recorded in the entire last calendar year. The macro backdrop remained best in recent times, with inflation under control, twin deficits in check, stable currency, and policy momentum intact.
According to him, only missing link in an otherwise positive set-up is earnings recovery. Nifty earnings have remained flat for the last five years and hold the key for further re-rating, he feels.
11:05 am Earnings Estimates: Pharmaceutical firm Biocon is expected to report degrowth of 32 percent in first quarter profit at Rs 113 crore compared with Rs 166.6 crore in year-ago quarter due to weak operational performance and higher depreciation.
Revenue is seen growing moderately to Rs 996.4 crore for the quarter against Rs 982.4 crore in same quarter last fiscal, according to average of estimates of analysts polled by CNBC-TV18.
Subdued revenue may be led by sluggishness in biopharma and domestic formulation negated by research services.
Domestic formulation business may fall as much as by 30 percent due to higher base and GST. However, growth from Syngene International, which is estimated at 10-18 percent YoY, may negate revenue pressure.
Operating profit during the quarter may drop 20% to Rs 211.3 crore and margin may contract by 560 basis points to 21.2 percent year-on-year.
10:48 am Market Check: Equity benchmarks rallied further in morning, with the Sensex rising 241.28 points at 32,623.74 and the Nifty up 79.45 points at 10,100.10.
The broader markets underperformed benchmarks, with the BSE Midcap index up 0.6 percent on positive breadth. About 1,173 shares advanced against 975 declining shares on the BSE.
10:40 am Earnings Estimates: India’s largest private sector lender ICICI Bank is all set to announce its first quarter earnings today.
Net profit for the quarter is expected to fall by 10.2 percent to Rs 2,005.3 crore compared with Rs 2,232.4 crore in same quarter last year, according to average of estimates of analysts polled by CNBC-TV18.
Sequentially, earnings are expected to remain under pressure due to high provisions.
Net interest income, the difference between interest earned and interest expended, may grow by 11.6 percent to Rs 5,758.4 crore in Q1 compared with Rs 5,158.5 crore in corresponding quarter of last fiscal.
This NII growth could be highest in last six quarters.
10:15 am Buzzing: Share price of Orient Cement rose 10 percent intraday as the company turned profitable in the quarter ended June 2017.
The company in Q1FY18 (April-June) has posted net profit of Rs 39 crore against the loss of Rs 7.6 crore, in a year ago period.
Revenue of the company increased 30 percent at Rs 657 crore versus Rs 505 crore.
The operating profit (EBITDA) was up 189 percent at Rs 117 crore and EBITDA margin was up 980 bps at 17.8 percent.
During the quarter, the company signed definitive agreement for the acquisition of 74 percent shares of Bhilai Jaypee Cement from Jaiprakash Associates and its nominees and for the business transfer of Nigrie Cement Grinding unit of Jaiprakash Power Ventures for an enterprise value of Rs 1,450 crore and Rs 496 crore respectively.
10:06 am Market Check: Equity benchmarks extended rally in morning, with the Sensex up 222.91 points at 32,605.37 and the Nifty up 71.50 points at 10,092.15.
About 1,168 shares advanced against 775 declining shares on the BSE.
9:58 am Market Outlook: The Indian market continued its bullish momentum, backed by steady earnings and strong political stability cues from the developments in Bihar on Wednesday. In the opening tick, indices surged to fresh highs.
Having said that, there are experts who still continue to be wary of the rally as it is not commensurate with the fundamentals. UBS Securities believes that from a fundamental perspective, the risk reward is unattractive.
“Political stability will help the market in the short term
there is a confidence that global investors have on this regime,” Gautam Chhaochharia, Head-India Research, UBS Securities told CNBC-TV18 in an interview.
So, what lies in store for global investors then? “From a long term perspective, these are not levels to be entered into. Valuations are not justified some of them (investors) have trimmed positions in India,” he told the channel.
9:38 am Buzzing: Shares of Indiabulls Real Estate rose nearly 9 percent intraday as investors cheered a ratings initiation on the stock.
While the stock rallied post its removal from the F&O ban, CLSA too initiated coverage on the stock with a buy rating and a target price of Rs 282.
CLSA said that the portfolio shift towards office income should double the lease income over the next five years.
The company, the brokerage added, will complete 20 msf of ongoing residential development projects over 3-4 years.
The recent steps for reorganization should lead to value discovery, it added.
The stock has multiple triggers to gain 50 percent over the next two years.
9:25 am Earnings: Software solutions provider HCL Technologies’ first quarter profit fell sharply by 6.6 percent sequentially to Rs 2,171 crore, impacted by lower revenue growth but better operational performance capped degrowth.
Revenue during the quarter grew by 0.8 percent to Rs 12,149 crore and dollar revenue rose by 3.7 percent to USD 1,884.2 million on sequential basis.
9:15 am Market Check: The market hit fresh record highs in early trade on Thursday, with the Nifty opening above 10,000 level on expiry day after US Federal Reserve meet and ahead of corporate earnings.
The 30-share BSE Sensex was up 126.76 points at 32,509.22 and the 50-share NSE Nifty rose 40.55 points to 10,061.20.
HCL Technologies and Yes Bank rallied up to 2.5 percent post earnings while ICICI Bank, Idea Cellular, ITC and Maruti Suzuki gained up to 1 percent ahead of earnings.
Tech Mahindra, Cipla, Hindalco and Bosch were moderately lower.
Nifty Midcap was up 0.5 percent as about seven shares gained for every two shares falling on the NSE.
Bharat Financial, Manappuram Finance, Ujjivan Financial and L&T Finance Holdings gained up to 3 percent while Indiabulls Real surged 8 percent. Shree Renuka Sugars and Parsvnath Developers also rallied.