Market Update for 26/08/2020: | Street-fluence

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WORLD MARKET:

  • S&P 500 futures were steady after both the benchmark and the Nasdaq Composite climbed to fresh records, helped by gains in Facebook Inc.
  • Crude oil traded near the highest in five months as Hurricane Laura bore down on key refining facilities on the U.S. Gulf Coast.
  • The head of the U.S. Food and Drug Administration acknowledged errors in comments about blood plasma therapy and said he would never reverse an agency decision for political reasons.
  • The U.S. and China reaffirmed their commitment to the phase-one trade deal in a biannual review, demonstrating a willingness to cooperate even as tensions rise over issues ranging from data security to democracy in Hong Kong.

STOCK WISE NEWS

VA Tech Wabag: Board approves issuance of up to 75 lakh shares on a preferential basis at Rs 160 per share. The issue price is a 30% discount to Tuesday’s closing. Rekha Rakesh Jhunjhunwala will be issued up to 50 lakh shares while the other 25 lakh will be issued among Basera Home Finance, Sushma Anand Jain and Anand Jaikumar Jain of Jai Corporation.

TCS: S&P revises long-term issuer credit rating to stable from positive while affirming the rating as A. S&P says that the company is likely to face slower growth in revenue and profitability over the next 12-18 months, given subdued global I.T. spends. The ratings agency anticipates pricing pressures on new contracts and renewals due to low spending ability of clients in a highly competitive market.

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Acrysil: To expand capacity for quartz kitchen sinks by 20% to 6 lakh units per annum at its Gujarat plant to meet increasing demand from the export market. Total capex of Rs 15 crore will be funded by internal accruals and the new capacity will be commissioned by March 2021.

SeQuent Scientific: Kamal Sharma and Milind Sarwate appointed on the board as independent directors. Kamal Sharma will also be the Chairman of the company as Gopakumar Nair has stepped down from the post. Nominee directors from Carlyle Group – Neeraj Bharadwaj and Rahul Mukim have joined the board.

Auto 2-wheelers: Two-wheelers are neither a luxury nor sin goods and so merit a GST rate revision, Finance Minister Nirmala Sitharaman said at an industry interaction on Tuesday.

According to a statement issued by CII, which was also issued by the finance ministry’s spokesperson, Sitharaman said a rate revision proposal would be taken up by the GST Council.

Two-wheelers currently attract 28 per cent GST.

Edelweiss: ET Reports Pacific Alliance Group to buy wealth and Investment banking biz of Edelweiss for 2,500 cr

Air Passenger traffic doubled from May 4 to the 3rd week of August

RESULT CORNER:

Can Fin Homes Q1FY21:

  • Net Interest Income up 23.9% to Rs 191.7 crore
  • Net profit up 15.1% to Rs 93.2 crore
  • Holds provisions worth Rs 72.89 lakh for Covid-19
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BROKERAGE UPDATE

Investec On PSU Banks

  • Moratorium 2.0 numbers is 20-25% ex-SBI
  • 7-8% of advances face immediate risk of default
  • Slippages are bound to be elevated in the near-term
  • Near-term asset quality and dilution risks remain elevated

Brokerages on LUPIN-

Morgan Stanley:

  • Turning point in the inhaler story
  • Lupin can generate sales worth $120-150 million over next two years
  • Low visibility of additional competition from hereon

Nomura:

  • Albuterol MDI market is attractive
  • Expect pricing environment to remain stable –
  • Current market size of $1.5-2 billion can be on account of higher demand and inventory build-up which may normalise going ahead.

Kotak:

  • Expect FY21 to be a pivotal year for Lupin’s inhalation efforts.
  • Expect progress in all other key assets including Fostair, Spiriva and Dulera Albuterol is a highly intensive product on manufacturing, requiring solid manufacturing execution.
  • Model in sales worth $83 million in FY22E and see upside risks depending on manufacturing scale-up.

Jefferies On Telecom:

  • TRAI’s latest disclosures indicate the adverse impact of lockdown in urban markets
  • Rural markets delivered growth even during the lockdown
  • Bharti Airtel and Jio gained revenue market share between 200-470 basis points
  • Vodafone Idea lost revenue market share worth 580 basis points with the top three markets contributing 60% of its market share loss
  • Vodafone Idea’s market share loss indicates that the market is moving towards a duopoly
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Jefferies On HDFC Bank
– Buy rating, Target At 1,350/Sh
– Management believes Market Share Gains From PSU To Private Banks Will Continue
– Market Share Gains Offer Scope To Double Share In Credit From 7-8% Now
– Moratorium Loan Book Is Smaller Vs Peers At 9%

PROMOTER CORNER:

Godrej Industries: Promoter Godrej Seeds and Genetics acquired 1.7 lakh shares between Aug 19-20.

Jamna Auto: Promoters acquired 2.1 lakh shares on Aug 21.

Shilpa Medicare: Promoter Ramakant Inani sold 2.5 lakh shares between Aug 19-24.

Ultratech Cement: Promoter Pilani Investments sold 1.25 lakh shares on Aug 19.

Dr Lal Pathlabs: Promoter and director Dr Arvind Lal sold 1.4 lakh shares from Aug 21-25

AUTO EXPECTATIONS FOR AUGUST 2020
(expectations ac to Nomura)

Ashok Leyland= 6,076
Bajaj Auto= 315,000
Royal Enfield= 53,000
HeroMoto= 590,000
Maruti= 130,000
M&M(Tractor+Auto)= 49,450
TVS= 286,000

FII bought 1421 cr
GOLD 1934
DXY 93.12
CRUDE 46.4



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Akshada Deo
Akshada posts the daily market updates in a summarized format. Stock Market, Literature, Music, and Design are her passions.
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