Sectoral Trend BSE Sensex gainers and losers Market at open At 9:16 AM, the S&P BSE Sensex was trading at 34,424, up 9 points while the broader Nifty50 was ruling at 10,572, up 8 points. CIMB on TCS results We raise FY19F-20F EPS by 3% for improving demand, margin management and currency. We think TCS deserves premium valuation over its peers given its expected higher organic US$ sales/earnings growth in FY19F. However, we believe the recent runup in share price has factored this in. Maintain Hold, with a higher target price of Rs 3240, based on one-year forward P/E of 19x (5-year mean) vs. 17x earlier for improving sales/earnings growth. IDBI Capital on HDFC Bank HDFC Bank delivered another stable performance, with its numbers largely in line with our expectations. GNPAs are around 1% consecutively for each of the past eight years, whereas restructured loans were miniscule. It has marginal exposure to only two accounts of the forty accounts mentioned by the RBI. Its CASA deposit franchise is strongest among peers. We are structurally positive on HDFCB considering its healthy asset quality, superior deposit franchise and credit underwriting, structurally better NIM and the ability to maintain RoA at ~2.0% and RoRWA at ~2.5% in the long run. In times of gigantic deterioration in asset quality for corporate peer bank, preference toward high quality retail banks will continue to remain. As a result premium valuation for HDFCB is fairly justified in our opinion. We value HDFC Bank at 4.4x P/ABV FY19E (30% premium to mean valuations) deriving a target price of Rs2,400 with a BUY rating. Corporate News · Cipla's Pithampur plant gets three observations from U.S. FDA · U.S. FDA concludes the inspection of Unichem Labs’ Ghaziabad facility with no observations · Coal India plans 41.5 million tons forward coal auctions in the current financial year · Axis Bank commenced succession process for a new CEO and MD. Appoints Egon Zehnder to for process · SJVN signs accord with power ministry and aims to achieve 9,200 million units in financial year 2019 · RIL says it is not aware of any further investigation undertaken by the I-T department regarding the Rs 6,500-crore foreign direct investment by Biometrix in the company’s group entities · Adani Enterprises forms a joint venture with Prakash Asphaltings for Bilaspur Pathrapali Road Private Ltd. in the ratio of 74:26 · Indian Hume Pipe Company secures Rs 578.50 crore order from Madhya Pradesh Jal Nigam Maryadit · Kitex Garments Board to meet on April 25, 2018 to consider proposal for further investments · India Ratings upgrades HEG Limited's Long-Term Issuer Rating to 'IND AA' from 'IND A+'. The Outlook is Stable · Orchid Pharma says committee of creditors have rejected all three bids for the company · Morepen Labs appeals to NCLAT against the order passed by NCLT, Chandigarh bench. · Electrosteel Steels says steering committee was set up as per resolution plan · Lenders of Nagarjuna Oil Corporation decide that the company should go for liquidation (Source: IIFL report)
(With inputs from Reuters)
