Manish Hathiramani, Proprietary Index Trader and Technical Analyst, Deen Dayal Investments
The Nifty gave up most of its gains as the day progressed. The weakness continues to remain in the short term and we can expect the index to slide further to levels closer to 14,500. Any rally up can be used to short this market for lower targets. The upside is capped at 15,000 -15,100 and until we do not get past that comfortably, the markets will remain bearish.
Market At Close
- Sensex & Nifty Close With Minor Gains Amid Volatility; Financials Underperform
- Midcap Index Outperforms With The Index Gaining More Than 1%
- Nifty Rises 32 Points To 14,708 & Sensex 7 Points To 49,751
- Nifty Bank Slips 140 Pts To 35,117 While Midcap Index Rises 231 Pts To 23,053
- Kotak Bank, HDFC Twins Drag Nifty By 55 Points While RIL & ICICI Lift By 21 Pts
- Metal Stocks Amongst Top Performers As Prices Rise; Tata Steel Up Over 6%
- Positive Mgmt Commentary At Analyst Meet Lifts Tata Motors, Stock Up 6%
- Hindalco’s Dividend Distribution Policy Update Boosts Stock, Up 8% In 2 Sessions
- UPL Rises 10% From Lows Following Co’s Update Of No Fatality At Fire In Guj Plant
- VA Tech Extends Gaining Streak After Sharp Increase In Target Price By Nomura
- Insurance Cos Record Healthy Gains With GIC & New India Assurance Gaining 3-7%
- Rpts Of Shipping Delays Brazil Help Sugar Stocks Gain; Balrampur Up Over 6%
- Market Breath Favours Advances; Advance-Decline Ratio At 3:2
Closing Bell | The Indian equity market ended flat on Tuesday as gains in metal and energy stocks were capped by losses in banking and financial space. The Sensex ended 7.09 points, or 0.01 percent higher at 49,751.41, while the Nifty closed at 14,707.80, up 32.10 points, or 0.22 percent. Broader markets, smallcap and midcap indices outperformed the benchmarks as they gained 1 percent each.
Among sectors, Nifty Metal rallied the most over 3 percent followed by Nifty Realty, Nifty Auto, Nifty FMCG and Nifty IT, while Nifty Private Bank and Nifty Financial Services ended in the red. On the Nifty50, Tata Steel, Tata Motors, Hindalco Industries, ONGC and UPL were the top gainers, while Kotak Mahindra Bank, Adani ports & SEZ, Maruti Suzuki, Bajaj Auto and Divi's Laboratories were the top losers.
Market Watch: Sushil Kedia Founder of Kedianomics
On Markets
There is a 70-80 percent chance that the high for the market has been made. The range that was apparent on the Nifty last week was from 15,560 to 14,600. Even if 14,600 has been kissed, this range has not remained intact on the upside at 15,560. We are placing the new index range at 15,150 until broken and on the downside to 14,100.
On HDFC Bank and Kotak Mahindra Bank
HDFC Bank until and unless Rs 1,572 is broken, we will be looking for every rally to try and sell the stock. On Kotak Mahindra Bank, my longer-term view is notorious, I will not be surprised if Kotak Mahindra Bank people get to buy in three digits. However, for the very short run I am looking at Rs 1,700 on to break before it goes and breaks Rs 2,050. Rs 2,050 high seems like a good number that should not get crossed on the upside for the time being.
Market Watch: Sanjiv Bhasin, IIFL Securities
On Autos
Let me give a disclosure here - after almost two years of underperformance, one of my commercial vehicles (CVs) has been a star, that is Ashok Leyland. All the way from Rs 40 to Rs 130, I am more bullish on Ashok Leyland than Tata Motors. I thikn that can go to Rs 175 given that 50 percent of the bus market in India is with Ashok Leyland. Don’t underestimate the potential of the rally in CVs. I am very bullish on the auto space. At these levels, Maruti Suzuki is a personal buy because we think that all these semiconductors problem, they will be able to handle it because they have a good stock. Tata Motors, Ashok Leyland, Maruti all are buys from my side.
On ONGC
It is all about valuation, at Rs 70 it was the cheapest energy stocks in the world and at Rs 110 it still has scope to go to Rs 130-140. What the government has done as far as PSUs are concerned, is never seen in the last 20 years and there is way to go. As a disclosure – three–three years of underpinning or lot of frustration for us has been PSUs and they have come to life now. I thikn PSUs are here to stay.
NBCC has been my lame duck for last three years. At Rs 39, I can guarantee you Rs 75 coming by this Diwali. Simply for the fact that businesses were good, it was just the laziness which people felt on PSUs. I think that is over.
I thiknk there is still room on GAIL, Petronet LNG, ONGC and plus the headwinds are now tailwinds as far as oil goes.
NBFCs face challenges amid soft interest rate regime
Non-banking financial companies (NBFCs) are witnessing a continuous loss in market share to banks as customers are favouring the latter due to lower interest rates and longer loan tenures. NBFCs continue to bet on the underbanked and new-to-credit segments to manage growth momentum while focusing on specific product segments such as used vehicle finance, affordable housing and low-ticket MSME loans.
However, the trend in the market share losses for NBFCs to banks is continuing, especially in housing and private auto segments. According to a report by Emkay Global Financial Services, new housing loans -- especially in the affordable category -- used vehicle loans and MSME loans are seeing significant momentum, followed by auto and two-wheelers, while the cautious stance stays regarding unsecured loans. Read more.
Oil prices jump more than $1 as US output slow to restart
Oil prices jumped by more than $1 on Tuesday, underpinned by optimism over COVID-19 vaccine rollouts and lower output as U.S. supplies were slow to return after a deep freeze in Texas shut in crude production last week. Shale oil producers in the southern United States could take at least two weeks to restart the more than 2 million barrels per day (bpd) of crude output that shut down because of cold weather, as frozen pipes and power supply interruptions slow their recovery, sources said.
Market Update | The Indian equity indices were trading higher Tuesday afternoon led by gains in metals, auto and energy stocks. The benchmark Sensex gained 116.74 points, or 0.23 percent to 49,861.06, while the Nifty was trading 65.00 points, or 0.44 percent higher at 14,740.70 at 2:20 pm.
Sun Pharmaceutical Industries | The company will introduce the complete range of Brivaracetam dosage forms at an affordable price for epilepsy treatment in India. Brivaracetam is approved by DCGI as an adjunctive therapy in treatment of partial-onset seizures in patients 16 years of age and older with epilepsy.
Sweta Patodia, Analyst, Corporate Finance Group, Moody’s Investors Service
Reliance Industries' separation of its O2C business to a subsidiary will facilitate a potential stake sale to Aramco, possibly enabling a further reduction in RIL's net debt. Until the stake sale is completed, there will be no subordination risk for RIL’s lenders, as the company will continue to have full access to the O2C business’ cash flows, given its full ownership of and no external debt at the new subsidiary.
Emkay Global Financial Services on Tata Motors
We rate Tata Motors as a high-conviction buy with a target of Rs 355, based on an EV/EBITDA of 2x/11x on JLR/standalone estimates on FY23E and the value of investments at Rs 55 per share. We remain positive on expectations of sales cycle recovery in JLR/India divisions, strong profitability growth on better scale/cost savings and de-leveraging efforts through FCFs/divestments
Market Watch: Shrikant Chouhan of Kotak Securities
One stock which is very close to its breakout level that is BPCL, currently it is trading at Rs 435-440. If we go through with the chart pattern of BPCL then after very long time the stock is forming large bodies that means that something is really happening in this stock and yes there is news flow also. So based on technical I am expecting stock to move towards Rs 465-470 in the near term with a stop loss at Rs 425 we should be buyer in BPCL at current levels.
The other stock which we like is IRCTC, all the PSU stocks are showing lot of strength and IRCTC recently it was like around some Rs 1,800 levels, all the way it has corrected to Rs 1,600. At current levels of Rs 1,600 it looks really strong with a stop loss at Rs 1,550 again we can expect Rs 1,750-1,850 on the higher side.
Cochin Shipyard | The company has been declared the lowest bidder in the tender floated by the Indian Navy for the construction of 6 missile vessels and the estimated total order value is around Rs 10,000 crore.
Bitcoin battles for support at $50,000
Bitcoin dropped below USD 50,000 on Tuesday, as investors began to get a little nervous about the digital currency’s lofty valuation and some leveraged players took profit. The cryptocurrency dropped more than 10 percent, its largest daily drop in a month, to hit USD 48,575. That extends a sharp withdrawal of more than 16 percent from a record high hit on Sunday, although bitcoin remains up around 75 percent for the year.
The drop came despite a broad US dollar weakness. ”The market’s rallied almost unimpeded since the beginning of the month and to some degree since the beginning of the year,” said James Quinn, managing director at digital asset platform Q9 Capital in Hong Kong. Read more.
Keshav Lahoti, Associate Equity Analyst, Angel Broking
Heranba Industries is present in a wide range of products across the entire value chain of synthetic pyrethroids. Company has product registrations in the domestic and international markets enabling global outreach. It also has a strong product portfolio and wide distribution network. Although, Absence of large customers and dependence on smaller customers increases uncertainty of demand which may have an adverse impact on the business operations and financial performance. Ahead of the issue, the Company has managed to raise Rs 187.5 crore from anchor investors, allotting them 29.90 lakh equity shares.
We expect a good listing for the Company. We are positive on the long-term prospects of the Company, we recommend "SUBSCRIBE" to the Heranba Industries IPO for long term as well as for listing gains.
Dilip Buildcon buzzing after Nomura call; management says diversification the key
Dilip Buildcon is buzzing in trade after Nomura bets on the company with a buy call. The diversification into coal mine developer-cum-operator (MDO) and rail appears to be synergistic. To discuss this and the outlook for the year ahead, Rohan Suryavanshi, the head of strategy and planning spoke to CNBC-TV18.
Suryavanshi said, “Diversification has been a key strategy for the company over the last few years. We have thought about diversification in three ways, one is the geographical diversification, second through different segments and third is the short-term contract versus long term contracts.” Read more.
Tata Motors shares rally over 5% as CLSA raises target price
Shares of automobile major Tata Motors rallied over 5 percent on Tuesday after global brokerage house CLSA retained its bullish stance on the stock and raised its target price. The brokerage maintained a 'buy' call on the stock and raised the target price to Rs 400 per share. It also hiked FY22-23 EPS estimates by 4 percent driven by higher volume and better margin for India business. The stock price of the auto major has risen more than 86 percent in the last three months. Read more.
InterGlobe Aviation | IndiGo Airlines and Dubai Aerospace Enterprise have signed long-term lease agreements for 7 Airbus A321 neo aircraft, scheduled to be delivered in 2021.
Heranba Industries IPO subscribed 35%
The Rs 625-crore initial public offering of Heranba Industries has been subscribed 35 percent so far on February 23 (Tuesday), the first day of bidding. The public issue has received bids for 24.70 lakh equity shares against offer size of 69.81 lakh shares, as per the subscription data available on the exchanges. The portion reserved for retail investors has been booked 50 percent.
Market Watch: Ajit Mishra, Religare Broking
Since yesterday we are seeing that metals stocks despite of whatever we are seeing in the Index are holding strong and Tata Steel is one of the best counter that we see at current levels which one can consider fresh buying. So Tata Steel one can buy at current levels with Rs 690 as a stop loss and Rs 750 as a target.
We are seeing IT counters witnessing selling pressure, so all the IT majors be it Wipro, HCL Technologies, Infosys we are seeing some bit of profit taking, so we expect this profit taking to extend further so one can go short in Wipro at current levels with a stop loss of Rs 428 and target of Rs 404.
Bharti Airtel partners with Qualcomm for 5G services in India
Telecom major Bharti Airtel announced its collaboration with US chipmaker Qualcomm Technologies, Inc. to roll out 5G services in India. Airtel will utilize the Qualcomm 5G RAN Platforms to roll-out virtualized and Open RAN-based SG networks.
RIL demerger: Creates smoother process for Aramco deal to happen, says Centrum Broking’s Probal Sen
Reliance’s reorganisation creates a smoother process for Aramco deal to happen, said Probal Sen, Senior Vice President at Centrum Broking, on Tuesday. The observation comes as Reliance Industries announces that it will spin-off its oil-to-chemical (O2C) business into an independent 100 percent subsidiary which will constitute the refining, petrochemical and fuel retailing businesses. Post reorganisation, Reliance will continue with management control.
Speaking in an interview with CNBC-TV18, Sen said, “This will allow strategic investors to invest in a cleaner balance sheet and also creates a smoother pathway for likes of Aramco to probably look at business without the legacy debt hampering future prospects. This is on expected lines from the time that they have been talking about setting O2C as a separate unit. We all knew that this demerger would happen as and when negotiations advance with interested buyers. So the fact that they have done it and they have put in a clear timeline, for the next 6-months for closing all the required regulatory approvals, implies that discussions with Aramco are back on track.” More here
Hindalco shares jump 4% on announcement of capital allocation framework, debt reduction plan
Shares of Hindalco rose nearly 4 percent to hit a 52-week high on Tuesday after the firm announced a capital allocation framework for Capex growth, debt reduction and shareholders’ returns. The company board also approved amending the dividend distribution policy on February 22. It will now pay an 8-10 percent dividend from the consolidated free cash flow against its existing policy of paying 10-30 percent of the standalone net profit. In an investor presentation, the firm said that the allocation towards growth capex is considered at $2.5-3 billion over the next five years. It also expects to generate over $1-1.2 billion cash flow per annum post its normal working capital and maintenance capex.
