Emkay Global on Wirpo
We tweaked FY22E EPS by -1%, factoring in Q4 performance, Ampion acquisition and robust deal signings. Simplified operating model, leadership augmentation and Capco acquisition show Wipro’s growth aspiration and its resolve to take big bets. We like some of these steps; however, tangible results hinge on strong execution. Considering poor execution track record, we prefer to wait for clear signs of improvement in operating metrics. We maintain Hold with a TP of Rs 450 at 20x FY23E earnings.
Macquarie underweight on capital goods stocks, here’s why
Macquarie has an underweight rating on all capital goods stocks. According to Macquarie, Maharashtra exposure will have an impact on the near-term earnings and the second wave of COVID-19 can pose some serious risks to the multiples of these companies. The brokerage house believes the biggest hit will be on Siemens – around 75 percent of the businesses could be affected. The likes of ABB India, Cummins and Thermax could also face supply chain disruptions of close to 40-45 percent of businesses. The least impacted will be Bharat Heavy Electricals Ltd (BHEL). More here
JUST IN: L&T Construction gets orders in the range of Rs 1,000-2,500 cr for its various businesses
Market Watch: Jay Thakkar of Marwadi Shares & Finance
– Britannia Industries is a buy with a stop loss at Rs 3,580 and target of Rs 3,900-4,000 in the short term.
– Bajaj Auto is a buy with a stop loss at Rs 3,550 and target of Rs 3,800- 3,850 in the short term.
Top Sensex gainers and losers at this hour
Market Watch: Aditya Agarwala of Yes Securities
– Buy Asian Paints with a stop loss at Rs 2,600 and target price of Rs 2,750.
– Buy Mahindra & Mahindra with a stop loss at Rs 790 and target price of Rs 822
Ashoka Buildcon shares rally 10% on receiving LoA for project worth Rs 333.63 crore
The share price of Ashoka Buildcon rallied over 10 percent after the company received a Letter of Award (LOA) from Gujarat Rail Infrastructure Development Corporation for a project worth Rs 333.625 crore. The stock price rose as much as 10.7 percent to an intraday high of Rs 98.50 apiece on the BSE. The shares have gained more than 58 percent in the last six months. “Ashoka Buildcon had submitted a bid to Bahucharaji Rail Corporation Ltd (BRCL), Gandhinagar, represented by the Gujarat Rail Infrastructure Development Corporation Ltd (G-RIDE) for the project that included gauge conversion of Bechraji (63.83 KM) – Ranuj (101.983 KM) Section with a total length of 38.153 km with 25 KV AC Electrification in Ahmedabad Division of Western Railway,” the company said in a regulatory filing.
Gold rate today: Yellow metal falls near Rs 47,000 per 10 grams
Gold prices in India traded marginally lower on the Multi Commodity Exchange (MCX) Friday tracking a muted trend in the international spot price on upbeat US economic data. However, analysts suggest buying on dips amid increasing safe-haven appeal. At 10:15 am, gold futures for June delivery fell 0.18 percent to Rs 47,092 per 10 grams as against the previous close of Rs 47,175 and opening price of Rs 47,099 on the MCX. Silver futures traded 0.19 percent lower at Rs 68,407 per kg. The prices opened at Rs 68,400 as compared to the previous close of Rs 68,540 per kg. More here
Kotak Mahindra Bank seen among potential suitors for Citi’s retail business
Citibank India’s consumer banking business is up for grabs, with the global giant announcing its decision to exit India’s retail operations. CNBC-TV18 first reported the development on Thursday. According to a note by Credit Suisse, Kotak Mahindra Bank may be a key contender to buy out Citi’s retail operations, including the high-margin cards business. Ashish Gupta, Head of Research at Credit Suisse wrote in a note that Citi’s retail business may add about 6 to 10 percent to the retail book of larger private banks in India. He also said that it may add about 5 to 8 percent to the customer base of the larger private banks. Given that the global giant in primarily focused on the affluent segment, even this relatively small business may be of interest to several banks. When Royal Bank of Scotland exited India, it had similarly sold its business to RBL Bank. READ MORE
Wipro shares jump 7% on strong Q4 results; lifts IT index up 1.5%
Shares of IT major Wipro rallied over 7 percent on Friday after the firm reported its best Q4 in 10 years. The company sees sequential revenue growth of 2-4 percent in Q1 of FY22 in the range of $2.19 billion to $2.23 billion. This will be backed by a strong demand environment and a robust pipeline of digital deals. The stock surged as much as 7.4 percent to its day’s high of Rs 463.20 per share. Other IT stocks were also trading higher following the rise in Wipro with the Nifty IT index up over 1.5 percent. L&T Infotech, Mindtree, HCL Tech, Coforge, Tech Mahindra rose between 1 percent and 3 percent. The company posted a net profit of Rs 2,972.3 crore, a 28 percent rise from the year-ago period, on the back of higher revenues. The revenues for Q4 also grew 3.4 percent year-on-year (y-o-y) to Rs 16,245.4 crore on broad-based growth across sectors.
Morning market quote from Dr. V K Vijayakumar, Chief Investment Strategist at Geojit Financial Services
“There are clear indications of a sharp turnaround in the global economy thanks to the massive monetary & fiscal stimulus, particularly from the developed world. Macro data from the US like jobless claims and retail sales point to a smart rebound in the world’s largest economy. The second-largest economy China too is doing well. This augurs well for the global economy in general & EMs in particular. In India, increasing restrictions on economic activity will impact growth in FY 22. Looks like the restrictions will last till the end of May. Even if GDP growth declines by 1% India is likely to end FY 22 with a growth rate of around 10%. From the market perspective, the decline in US 10-year yield to 1.56% and the resumption of FII buying ( Rs 980 cr yesterday) are positives. Even in the context of bad Covid numbers, the market is likely to remain resilient”
Opening Bell: Sensex opens over 100 points higher, Nifty above 14,600; Wipro up 3% post Q4
Indian indices opened higher on Friday, following gains in global peers after a batch of Chinese and U.S. economic data helped underpin global stocks near record highs. Back home, gains were led by banking, IT and metal stocks. At 9:18 am, the Sensex was trading 134 points higher at 48,937 while yhe Nifty rose 29 points to 14,610. On the Nifty50 index, Wipro, Aian Painta, Tech Mahindra, Maruti and Eicher Motors were the top gainers while Sun Pahrma, ONGC, UPL, RIL and Adnai Ports led the losses.
China’s economic growth surged to 18.3% as activity revived
Chinas economic growth surged to 18.3 percent over a year earlier in the first quarter of this year as factory and consumer activity recovered from the coronavirus pandemic. The figures announced Friday were magnified by comparison with early 2020 when the economy suffered its deepest contraction in decades. The government noted growth compared with the final quarter of 2020 when recovery was underway, was a more modest 0.6 percent. Business activity has mostly returned to normal since the ruling Communist Party declared victory over the coronavirus last March and began allowing factories and stores to reopen. More here
Steel sector set to mine best ever earnings growth in Q4FY21
Soaring steel prices coupled with low coking coal prices are set to lift the March quarter earnings of the metals and mining sector, especially steel companies which are likely to report best-ever profits. The earnings’ dream run for the sector is expected to continue driven by rising steel prices, which are up around Rs 5,000-6,500 per tonne QoQ, supported by low coking coal prices and partly offset by higher iron ore prices. Coking coal prices continue to trend down due to no offtake of Australian coking coal by China. The mid-month hike in HRC is expected to continue, while the export prices may continue to offset any weakness in domestic demand, experts said. More here
After best Q4 in 10 years, Wipro to roll out bonuses, promotions
Information technology services major Wipro on Thursday saw its best fourth quarter results in ten years, and showed a strong deal win in the quarter helping the company guide for a sequential revenue growth of 2-4 percent in Q1 of FY22 (and a 11-13 percent growth in the quarter year-on-year). The company is also set to roll out promotions across bands, offer skill-based bonuses and salary hikes for senior employees in June this year, CEO Thierry Delaporte said today, adding that the company looks to be the ‘leader’ in the war for talent. “We recognise that we are competing for quality talent, and we are fully prepared to lead the war for good talent. We are investing in building talent at scale, we have implemented several interventions to retain diverse talent,” Delaporte said. More here
Citi to exit India consumer business through sale, says customers won’t be impacted
It is the end of an era, with Citibank announcing its intention to exit the consumer banking business in India, first started back in 1985. The bank will now look for a buyer for its consumer book, including the credit cards business as part of its exit strategy, a spokesperson for Citibank India told CNBC-TV18.
Why the exit?
While announcing its first-quarter earnings for 2021, Citigroup’s global CEO Jane Fraser announced the bank’s exit from consumer banking in 13 countries including India. “While the other 13 markets have excellent businesses, we don’t have the scale we need to compete. We believe our capital, investment dollars and other resources are better deployed against higher returning opportunities in wealth management and our institutional businesses in Asia. We will continue to update you on strategic decisions as we make them while we work to increase the returns we deliver to our shareholders,” Fraser said. More here
First up, here is quick catchup of what happened in the markets on Thursday
Indian equity market ended Thursday’s volatile session higher led by gains in metals and pharma stocks. The Sensex ended 259.62 points, or 0.53 percent, higher at 48,803.68, while the Nifty gained 76.65 points, or 0.53 percent to close at 14,581.45. Broader indices ended mixed as the Nifty Midcap 100 ended flat, while the Nifty Smallcap100 closed marginally lower. Among sectoral indices, gains were witnessed in metals, pharma, IT, Financial Services and Private Banks, while the Nifty Auto, Nifty FMCG and Nifty PSU Bank indices ended in the red. TCS, Wipro, Cipla, ONGC and ICICI Bank were the top Nifty50 gainers, Grasim Industries, Eicher Motors, Maruti Suzuki, Infosys and IndusInd Bank were the top losers.
Welcome to CNBC-TV18’s Market Live Blog
Good morning, readers! I am Pranati Deva from the market’s desk of CNBC-TV18. Welcome to our market blog, where we provide rolling live news coverage of the latest events in the stock market, business and economy. We will also get you instant reactions and guests from our stellar lineup of TV guests and in-house editors, researchers, and reporters. If you are an investor, here is wishing you a great trading day. Good luck!
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