Stocks Markets Live: Sensex, Nifty Swing In Opening Trade; M&M, Bank of Baroda Drop Nearly 6%

Shares of the non-banking finance company jumped as much as 20%, the most since Oct. 25, 2019, after its board approved a Rs 4,000 crore fundraise proposal.

The fundraising will be led by entities affiliated with The Carlyle Group Inc and will trigger an open offer. Carlyle entity to invest up to Rs 3,185 crore through a preferential allotment of equity shares and warrants, at a price of Rs 390 per share.

The existing shareholders of the company also participating in the fundraise. Salisbury Investments Pvt. Ltd., the family investment vehicle of Aditya Puri, Senior Advisor for Carlyle in Asia, will also invest in the capital raise.

Puri is expected to be nominated to the PNB Housing Finance Board as a Carlyle nominee director in due course, according to the company’s notification to the exchanges.

Shares of the drugmaker rose 3.9%, making them the best performer on the Nifty Index, after reporting fourth-quarter earnings that beat analyst estimates.

• Trading in the company's call options was double the average. Trading volume was 11 times the average for this time of day.
• Trading volume was 1.09 million shares, 11 times the 20-day average of 96,120 shares for this time of day.

• Trading in the company's call options totalled 14,797 contracts, compared with the average of 6,856 over the past 20 days. Trading in the company's put options totalled 3,438 contracts, compared with the average of 2,381 over the same period.
• The relative strength index on the stock was above 70, indicating it may be overbought.
• Analysts have 17 buy, one hold, and three sell recommendations on the stock.
• The price target of Rs 4,310.31 represents a 0.7% increase from the last price

Shares of the public sector lender fell 5.7%, the most since April 19, after it reported an unexpected Rs 1,047 crore loss in the fourth quarter.

The loss was mainly on account of higher tax expenses. Net interest income for the quarter rose 4.54% year-on-year to Rs 7,107 crore while non-interest income rose 71% from a year ago to Rs 4,848 crore.

The bank’s asset quality condition improved, with gross non-performing asset ratio falling to 8.87% on March 31, as compared with 9.63% as of Dec. 31, 2020. Net NPA ratio rose to 3.09%, up 70 basis

The lender said it plans to raise Rs 5,000 crore ($690 million) from sales of shares and bonds.

CLSA’s Take

• Maintains ‘buy’ rating, raises target price from Rs 125 to Rs 130
• Bank’s Q4 surprised positively with less than 50 bps of slippage and strong adjusted net interest income performance.
• Corporate and overseas slippages were high but with the cycle turning, corporate slippage will likely come down leading to the partial normalisation of its return on equity.
• While the risk from the second wave of Covid-19 remains for its retail book and a true picture of SME stress will be reflected in 2HFY21, the corporate cycle is clearly turning
• While we prefer SBI, which has a more structural story, Bank of Baroda’s current <0.55x FY23 book valuation is undemanding.

Shares of the automaker slipped as much as 6.3%, the most since April 12, making it the worst performer on the Nifty 50 Index.

• Trading volume was 2.88 million shares, ten times the 20-day average of 279,210 shares for this time of day.

• Analysts have 31 buy, no hold, and four sell recommendations on the stock.

Indian stocks were off to a volatile start, after a key benchmark index closed at a record high last week, as investors remain cautious ahead of the release of the country’s economic growth data for fiscal year ended March later Monday.

The S&P BSE Sensex fluctuated between gains and losses, before slipping 0.47% to 51,179.94. The NSE Nifty 50 also declined by a similar magnitude. Sixteen of the 19 sector sub-indexes compiled by BSE Ltd. gained, led by a gauge of energy companies.

India’s earnings season for the March quarter has been mixed with 23 of the 43 Nifty 50 companies that have posted quarterly results, missing analysts’ estimates. Eighteen companies have reported numbers ahead of or in line with analysts estimates, according to data compiled by Bloomberg.