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Nearly 70 stocks rose 10-40% in post-Budget week | Trade Nivesh
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Nearly 70 stocks rose 10-40% in post-Budget week | Trade Nivesh
Trade Nivesh Small & mid-caps outperform! Nearly 70 stocks rose 10-40% in post-Budget week
Experts feel that if the momentum continues which it should, traders should not get surprised to see record highs in the February series. But, there are key resistance levels which the Nifty50 has to surpass.
A kneejerk reaction on the Budget Day of about 1,000 points on the Sensex and about 300 points on the Nifty50 painted a bleak picture for Indian markets, but bulls bounced back sharply in the following week.
After falling by about 5 percent or 587 points including the Budget Day losses in the week gone, Nifty50 managed to recover 437 points for the week ended February 7. The large action was seen in the broader market space.
The S&P BSE Sensex rose 3.5 percent while the Nifty50 rallied 3.75 percent. The S&P BSE Mid-cap index rose 5.1 percent while the S&P BSE Small-cap index was up 3.4 percent for the week ended February 7.
Experts feel that if the momentum continues which it should, traders should not get surprised to see record highs in the February series. But, there are key resistance levels which the Nifty50 has to surpass.
“We have seen a remarkable week for our market as we saw a v-shaped recovery especially after witnessing a shocker Budget Day. But, we managed to recoup losses and the way we are positioned now, we will not be surprised to see Nifty clock fresh record highs in the current series itself,” Sameet Chavan, Chief Analyst- Technical and Derivatives, Angel Broking.
“The mid and small baskets remain to be the center of attraction. It has recovered in tandem with benchmarks, but from hereon we expect these spaces to outperform,” he said.
There are as many as 68 stocks in the S&P BSE 500 index that rallied 10-40 percent which include names like JSW Steel, Adani Green Energy, GE Power, JM Financial, Bajaj Electrical, Aurobindo Pharma, HEG, V-Mart, Shriram Transport, Honeywell Automation, and Shilpa Medicare etc. among others.
With global markets on a high, the momentum should continue in Indian markets as well, but any escalation of coronavirus concerns could put brakes on global rally.
On the macro front, all eyes will be on the inflation data which will be out in the coming week along with December quarter results from the small and mid-cap space.
More than 1,000 companies will report their results for the quarter ended December from 10 February to 14 February. On the political front, elections results for the Delhi assembly will be watched on February 11.
On the macro front, December IIP and CPI inflation data for January will set the tone for markets on February 12, and WPI data for January will be out on February 14.
On the global front, China's January inflation rate is expected on February 10, US January inflation rate is expected on February 13, US January retail sales is expected on February 14 and EU December Industrial production data is expected on February 12.
"Since the overhang of Budget, RBI and major quarterly corporate results is behind us, the upcoming week could see dilly-dallying of bourses. As the major events are already taken care of, the Street will be largely guided by the global mood which is currently dependent on coronavirus," Umesh Mehta, Head of Research, Samco Securities told Moneycontrol.
"Markets will take time to sink in all the measures taken by the Government to revive the economic engine. Volatility will also subside considerably and certain pockets of stocks will experience profit booking," he said.
How is Nifty placed technically?
The Nifty50 bounced back from its swing low of 11,614 recorded on February 3 to reclaim 12,000 levels. However, it failed to close above 12,100, and 50-Days Moving Average placed at 12,118 on the daily charts.
The Nifty index consolidated in a range of 50 points for the most part of the session and formed a Bearish Candle on the daily scale. But, it formed a bullish candle on a weekly scale.
On the options front, maximum Put OI is at 12,000 followed by 11,500 strikes while Maximum Call OI is at 12,500 followed by 12,400 strikes.
Put writing is seen at 11,600 then 11,800 strikes while Call writing is seen at 12,300 followed by 12,500 strikes. Options data indicates a wider trading range between 11,800 to 12,300 zones.
“If we combine the price action of the last two weeks, we are seeing a Bullish Piercing pattern on the weekly chart. At current juncture, supports are gradually shifting higher and now till the time, it holds above 12,050 level, we may see ongoing optimism towards 12,200 then 12,250 zones; while on the downside, major support is seen at 12,000 then 11,950 zones,” Chandan Taparia, VP Analyst-Derivatives at Motilal Oswal Financial Services told Moneycontrol.
Bank Nifty index moved within the range of February 6 trading session and formed an Inside Bar pattern on the daily chart. While the banking index outperformed the benchmark index on the week-on-week basis and rallied by 4.63 percent to form a Bullish Engulfing pattern on a weekly scale.
“Formation of mentioned pattern around its 50 EMA on weekly chart certainly bodes well for the bulls. At the current juncture, it is sustaining well above the Falling Channel breakout level and 50 DEMA,” said Taparia.
He further added that supports are shifting higher to 31,000-30,800 zone and sustenance above the support zone may lead to an extension in an ongoing move towards 31,500 then 31,750 levels.
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Bajaj Finance beats estimates with 52% growth in Q3 profit | Trade Nivesh
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Bajaj Finance beats estimates with 52% growth in Q3 profit | Trade Nivesh
Trade Nivesh | The stock touched a fresh record high of Rs 4,326 on the BSE after strong earnings growth.
Bajaj Finance on January 29 reported a healthy 52 percent year-on-year growth in profit for October-December quarter of 2019 driven by strong NII and AUM with stable asset quality.
Profit during the quarter stood at Rs 1,614 crore up from Rs 1,060 crore in same period last year.
Net interest income rose by a whopping 42 percent year-on-year to Rs 4,537 crore in quarter ended December 2019, with 13 percent growth in new loans, Bajaj Finance said in its BSE filing.
"New loans booked during Q3FY20 increased by 13 percent to 7.67 million and customer franchise increased by 24 percent to 40.38 million as of December 31, 2019 YoY," it added.
Numbers beat analyst estimates. Profit was estimated at Rs 1,523.6 crore and net interest income at Rs 3,561 crore for the quarter, as per average of estimates of analysts polled by CNBC-TV18.
Total revenue from operations grew by 40.6 percent year-on-year to Rs 7,011 crore in Q3, driven by fund raising (Rs 8,500 crore).
Assets under management for the quarter met analyst expectations, growing at 35 percent year-on-year to Rs 1.45 lakh crore.
Gross NPA was unchanged at 1.61 percent QoQ, but net NPA increased 5bps sequentially to 0.70 percent in Q3FY20.
Loan losses and provisions (expected credit loss) for Q3 was Rs 831 crore (increased significantly from Rs 451 crore in Q3FY19 and Rs 594 crore in Q2FY20).
"During the quarter, the company has made an accelerated provision of Rs 85 crore in its loan against securities portfolio. Adjusted for this, loan losses and provisions (expected credit loss) for Q3 was Rs 746 crore," Bajaj Finance said.
Total slippages for the quarter at Rs 936 crore increased 19 percent over Rs 786 crore reported in Q2FY20.
Bajaj Finance said the two and three-wheeler portfolio marked 'Red' from 'Yellow' on sequential basis in Q3FY20.
"Two and three-wheeler portfolio with more than 30 days due increased to 6.83 percent at the end of December quarter (against 5.97 percent QoQ) and loan against property portfolio with more than 30 days due also rose to 2.84 percent (from 2.3 percent QoQ)," the non-banking finance company said.
Lifestyle book with more than 30 days due, too, increased to 1.26 percent (from 1.14 percent QoQ), but home loans with more than 30 days due declined to 0.29 percent (against 0.35 percent QoQ) and digital portfolio with more than 30 days due also dropped to 1.21 percent (against 1.35 percent QoQ).
Bajaj Finance said they have been seeing some uptick in our consumption category since December and the same has continued in January so far. "Republic Day sale momentum was strong."
Meanwhile, the company appointed Deepak Bagati as Chief Risk Officer in place of Fakhari Sarjan.
The stock touched a fresh record high of Rs 4,326 on the BSE after strong earnings growth. It was quoting at Rs 4,324, up Rs 110.95, or 2.63 percent, at 1345 hours IST.
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Bajaj Finance beats estimates with 52% growth in Q3 profit | Trade Nivesh
Trade Nivesh | The stock touched a fresh record high of Rs 4,326 on the BSE after strong earnings growth.
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Sachin Bansal resigns from Ujjivan Small Finance Bank board
Trade Nivesh Ujjivan Small Finance said that Bansal has stepped down as an entity owned by him has made an application to RBI for a universal banking license.
Sachin Bansal has resigned as an independent director of Ujjivan Small Finance Bank, citing conflict of interest.
"He (Bansal) has confirmed that he is resigning from the bank's Board in the interest of propriety and corporate governance as an entity owned and controlled by him has made an application to the Reserve Bank of India for a universal banking license," Ujjivan Small Finance said in a statement to stock exchanges.
The Flipkart co-founder acquired a majority stake in microfinance company Chaitanya India Fin Credit in September 2019. Earlier in January 2020, Chaitanya Ind Fin applied to the Reserve Bank of India (RBI) for a universal banking license.
Dear Board Members,
I would like to resign as an Independent Director of the Bank with effect from January 27, 2020. Consequently, I shall also cease to be a member of various Board Committees of the Bank.
Given an entity owned and controlled by me has made an application to the RBI for a universal banking license, I felt it was — in the interest of propriety and corporate governance — only appropriate that I stepped down from this role.
I take this opportunity to place on record my appreciation for the support extended to me by the Board during my tenure. It has been a sincere pleasure to serve on the Board and I wish the management of the Bank every success.
Further, as required under Regulation 30 read with Schedule III of SEBI (Listing Obligations and Disclosure Requirements) Regulations 2015, I hereby confirm that there are no other material reasons for my resignation as an Independent Director of the Bank other than those stated above.
Please take this letter on record and file necessary intimation with the regulatory authorities.
Yours faithfully,
Sachin Bansal
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Rakesh Jhunjhunwala under SEBI scanner over insider trading in Aptech
Trade Nivesh Billionaire investor Rakesh Jhunjhunwala is under the scanner of market regulator Securities and Exchange Board of India (SEBI) over alleged insider trading in Aptech shares.
SEBI is also examining the role of other Aptech board members, including Ramesh Damani and Madhu Jayakumar, The Economic Times reported.
Jhunjhunwala currently holds 24.24 percent stake in Aptech, which is valued around Rs 160 crore. It is the only company in his portfolio in which he has management control.
Jhunjhunwala, his wife Rekha, brother Rajeshkumar and mother-in-law Sushiladevi Gupta were called in for questioning on January 24, the report said.
Jhunjhunwala's sister, Sudha Gupta was question by the market regulator on January 23, the report added.
This is not the first time when Aptech is under the scanner of regulatory or investigation agency. Sebi already investigating Aptech in money routed through GDR which is also in last lap of investigation.
SEBI has transferred some of the case to Enforcement Directorate. Enforcement Directorate also investigating Aptech in using GDR route for launder money which is in preliminary stage.
SEBI is investigating from February 2016 to September 2016 period at the same time Rakesh Jhunjhunwala wife and his brother increased their stakes in Aptech via block deal and locked in upper circuit.
Insider trading usually involves trading in shares of a company based on non-public information. But non-publishing of price-sensitive information is also considered by SEBI as insider trading.
Moneycontrol could not independently verify the reports.
Jhunjhunwala’s office said he and his wife have 'no comments' to offer when approached by ET.
Jhunjhunwala first purchased a 10 percent stake in Aptech in 2005, at Rs 56 per share. He usually invests in equity through his company Rare Enterprises.
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HDFC Q3 profit jumps 296% on fair value gain after Gruh merger | Trade Nivesh
Trade Nivesh Housing Development Finance Corporation (HDFC), the country's largest housing finance company, on January 27 registered a whopping 296 percent year-on-year growth in standalone profit due to fair value gain after the merger of Gruh Finance with Bandhan Bank.
Profit increased to Rs 8,372.5 crore during the quarter, against Rs 2,113.8 crore in the same period last year.
Total revenue from operations jumped 91.82 percent year-on-year to Rs 20,285.47 crore for the quarter ended December 2019.
Gruh Finance, an associate company of HDFC, merged with Kolkata-based Bandhan Bank in October 2019 and thereafter HDFC received 9.9 percent stake in Bandhan Bank.
HDFC said it has recognised a fair value gain of Rs 9,019.81 crore on derecognition of investment in Gruh Finance.
While addressing a press conference, Keki Mistry, HDFC CEO said the individual category grew by 16 percent on AUM basis and the corporation sold loans aggregating Rs 21,066 crore in the last 12 months.
He further said total average loan size stood at Rs 26.90 lakh as of 9 months, and individual loans comprised of 81 percent and non-individuals 19 percent of total loans.
"The focus on affordable housing loans continued unabated this quarter and we continue to remain cautious in the non-individual loan segment," he added.
The company received approval from the board members for issuance of secured redeemable non-convertible debentures aggregating Rs 45,000 crore, in various tranches, on a private placement basis.
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ICICI Bank Reports healthy Q3 Numbers | Trade Nivesh
Trade Nivesh | Highlights of analyst call
The country's largest private sector lender ICICI Bank on January 25 reported healthy numbers in the quarter ended December 2019, barring a few concerns.
The bank’s profit during the quarter grew by 158.4 percent year-on-year to Rs 4,146.5 crore and net interest income increased 24.3 percent to Rs 8,545.3 crore, with loan growth of 12.6 percent YoY and net interest margin improving to 20-quarter high at 3.77 percent.
Asset quality improved with gross non-performing assets (NPAs) at 5.95 percent in Q3, the lowest in 14 quarters, declined from 6.37 percent in previous quarter. However, slippages increased to Rs 4,363 crore from Rs 2,482 crore sequentially, including one broking entity as well as a south based industrial company.
The management has guided for an increase in credit cost (NPA provisions) on account of lower recovery in NCLT cases. But this was guided by the management in the previous quarter as well that ex-NCLT recovery credit cost would be around 1.8-2 percent and with recovery from NCLT account it would be at 1.2-1.3 percent for FY20.
Here are the key takeaways from ICICI Bank's earnings call, collated by Narnolia Financial Advisors:
Management Participants: Sandeep Bakshi, MD
Slippages spiked in the corporate portfolio due to one brokerage client and a south-based industrial company. The brokerage company has been fully provisioned. The South India-based industrial company is servicing its due regularly, but has now been assessed to be restructuring, leading to classification as NPA. Watchlist slippages was Rs 707 crore.
The delinquency parameters across vintages in the personal loan and credit card portfolios have been stable and well within the internally defined thresholds. Increase in retail NPAs was on account of Kisan credit card and CV portfolio.
There was NPA deletion of Rs 845 crore due to compulsory convertible preference shares as a part of the debt- restructuring scheme. This account was fully provided.
Watchlist increased sequentially by 8 percent. There was Rs 2,666 crore downgraded from investment book category. Exposure to one account in the telecom sector downgraded to watchlist.
Recoveries & upgrades were Rs 4,088 crore, including a large steel account that was resolved under the IBC.
No disclosure on divergence in asset classification and provisioning for NPAs is required to be made.
Provisions during the quarter reflects the impact of full provision on the broking company exposure and provision on the industrial company, as well as recovery from the steel exposure under IBC.
The management increases credit cost guidance of FY20 from earlier range of 1.2-1.3 percent and expects it to be in the similar range of 9MFY20 because of recoveries from other than (Steel A/C) have not materialised as per expectation. Further, the broking company and south- based company has also impacted but would continue to target a normalised credit cost of about 25 percent of the core operating profit. The management is not hopeful of any major recovery in Q4.
The impact of interest on income-tax refund and interest collections from NPAs was about 10 bps this quarter compared to 6 basis points in Q2FY20.
The increase in non-employee expenses reflects the growth and franchise building in the retail business. There was a write-back in provisions for retrials due to increase in yields on government securities.
The decline in overseas book reflects the maturity of loans against FCNR deposits.
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ICICI Bank Reports healthy Q3 Numbers | Trade Nivesh
Trade Nivesh | Highlights of analyst call
The country's largest private sector lender ICICI Bank on January 25 reported healthy numbers in the quarter ended December 2019, barring a few concerns.
The bank’s profit during the quarter grew by 158.4 percent year-on-year to Rs 4,146.5 crore and net interest income increased 24.3 percent to Rs 8,545.3 crore, with loan growth of 12.6 percent YoY and net interest margin improving to 20-quarter high at 3.77 percent.
Asset quality improved with gross non-performing assets (NPAs) at 5.95 percent in Q3, the lowest in 14 quarters, declined from 6.37 percent in previous quarter. However, slippages increased to Rs 4,363 crore from Rs 2,482 crore sequentially, including one broking entity as well as a south based industrial company.
The management has guided for an increase in credit cost (NPA provisions) on account of lower recovery in NCLT cases. But this was guided by the management in the previous quarter as well that ex-NCLT recovery credit cost would be around 1.8-2 percent and with recovery from NCLT account it would be at 1.2-1.3 percent for FY20.
Here are the key takeaways from ICICI Bank's earnings call, collated by Narnolia Financial Advisors:
Management Participants: Sandeep Bakshi, MD
Slippages spiked in the corporate portfolio due to one brokerage client and a south-based industrial company. The brokerage company has been fully provisioned. The South India-based industrial company is servicing its due regularly, but has now been assessed to be restructuring, leading to classification as NPA. Watchlist slippages was Rs 707 crore.
The delinquency parameters across vintages in the personal loan and credit card portfolios have been stable and well within the internally defined thresholds. Increase in retail NPAs was on account of Kisan credit card and CV portfolio.
There was NPA deletion of Rs 845 crore due to compulsory convertible preference shares as a part of the debt- restructuring scheme. This account was fully provided.
Watchlist increased sequentially by 8 percent. There was Rs 2,666 crore downgraded from investment book category. Exposure to one account in the telecom sector downgraded to watchlist.
Recoveries & upgrades were Rs 4,088 crore, including a large steel account that was resolved under the IBC.
No disclosure on divergence in asset classification and provisioning for NPAs is required to be made.
Provisions during the quarter reflects the impact of full provision on the broking company exposure and provision on the industrial company, as well as recovery from the steel exposure under IBC.
The management increases credit cost guidance of FY20 from earlier range of 1.2-1.3 percent and expects it to be in the similar range of 9MFY20 because of recoveries from other than (Steel A/C) have not materialised as per expectation. Further, the broking company and south- based company has also impacted but would continue to target a normalised credit cost of about 25 percent of the core operating profit. The management is not hopeful of any major recovery in Q4.
The impact of interest on income-tax refund and interest collections from NPAs was about 10 bps this quarter compared to 6 basis points in Q2FY20.
The increase in non-employee expenses reflects the growth and franchise building in the retail business. There was a write-back in provisions for retrials due to increase in yields on government securities.
The decline in overseas book reflects the maturity of loans against FCNR deposits.
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