Today's Market

Tuesday, 24 July 2018

BSE Sensex at All Time High; ADANI PORTS & SEZ Among Top Gainers

The BSE Sensex has hit an all-time high at 36,928 (down 0.0%).

Among the top gainers in the BSE Sensex today are ADANI PORTS & SEZ (up 1.6%), HERO MOTOCORP (up 1.4%) and ONGC (up 1.2%). Other gainers include BAJAJ AUTO (up 1.1%) and VEDANTA LTD (up 1.1%).

The most traded stocks in the BSE Sensex are VEDANTA LTD and SBI.

ASIAN PAINTS (down 2.4%) and BHARTI AIRTEL (down 1.9%) are among the top losers today.

In the meantime, the NSE Nifty is at 11,153 (up 0.0%).

The top gainers in the NSE Nifty include BAJAJ FINSERV (up 2.9%), HINDALCO (up 2.0%) and ADANI PORTS & SEZ (up 1.5%). Other gainers include BANK OF BARODA (up 1.3%) and VEDANTA LTD (up 1.2%).

Which stocks contributed the most to the BSE Sensex?

Over the last one year, the BSE Sensex has moved up from Rs 32,246 to Rs 36,928, registering a gain of Rs 4,682 (up 14.2%).

The top gainers among the BSE Sensex stocks during this same period were TCS (up 56.4%), HIND. UNILEVER (up 43.8%) and INFOSYS LTD (up 38.2%).

What about the other broader BSE Indices?

Over the last 12 months, the BSE 100 index has gained 1,063 points and is now trading at 11,384 (up 10.3%). The top gainer here is BAJAJ FINANCE (up 73.3%).

The BSE 500 on the other hand gained 1,271 points (up 0.1%), and is currently at 15,010.

This article was originally published in English at www.equitymaster.com

Read the complete Indian stock market update. For the terms of use, go here.

VIP INDUSTRIES at 52 Week High; BSE 500 Index Flat

VIP INDUSTRIES share price has hit a 52-week high at Rs 483 (up 2.8%).

Meanwhile, the BSE 500 Index is at 15,034 (up 0.2%).

Among the top gainers in the BSE 500 Index today are VIP INDUSTRIES (up 2.8%) and RELIANCE COMMUNICATIONS (up 9.5%)

SYMPHONY LTD (down 15.9%) and HEXAWARE TECHNOLOGIES (down 5.6%) are among the top losers today.

Over the last one year, VIP INDUSTRIES has moved up from Rs 178 to Rs 483, registering a gain of Rs 305 (up 170.85%).

The BSE 500 has moved up from 13,763 to 15,034, registering a gain of 1,271 points (up 9.2%) during the last 12 months.

The top gainers among the BSE 500 Index stocks during this same period were HEG LTD (up 715.2%), GRAPHITE INDIA (up 397.4%) and RADICO KHAITAN (up 212.8%).

What About the Benchmark Indices?

The BSE Sensex is at 36,928 (up 0.0%). The top gainers among the BSE Sensex stocks today are VEDANTA LTD (up 2.0%), HERO MOTOCORP (up 1.6%) and ADANI PORTS & SEZ (up 1.6%). Other gainers include TATA STEEL (up 1.1%) and TATA MOTORS DVR (up 1.1%). The most traded stocks in the BSE Sensex are VEDANTA LTD and SBI.

In the meantime, NSE Nifty is at 11,153 (down 0.1%). BAJAJ FINSERV (up 2.9%) and INDIABULLS HOU. FIN. (up 2.4%) are among the top gainers in NSE Nifty.

Over the last 12 months, the BSE Sensex has moved up from 32,246 to 36,928, registering a gain of 4,682 points (up 14.3%).

VIP INDUSTRIES Financial Update...

VIP INDUSTRIES net profit grew 30.3% YoY to Rs 350 million for the quarter ended March 2018, compared to a profit of Rs 269 million a year ago. Net Sales rose 7.3% to Rs 3.6 billion during the period as against Rs 3.4 billion in January-March 2017.

For the year ended March 2018, VIP INDUSTRIES reported 48.8% increase in net profit to Rs 1.3 billion compared to net profit of Rs 852.0 million during FY17.

Revenue of the company grew 10.4% to Rs 14 billion during FY18.

The current Price to earnings ratio of VIP INDUSTRIES, based on rolling 12 month earnings, stands at 53.8x.

This article was originally published in English at www.equitymaster.com

Read the complete Indian stock market update. For the terms of use, go here.

Sensex Opens Flat; Consumer Durables & IT Stocks Drag

Asian stock markets are higher today as Japanese and Hong Kong shares show gains. The Nikkei 225 is up 0.5% while the Hang Seng is up 0.8%. The Shanghai Composite is trading up by 0.1%. Meanwhile, the Nasdaq Composite hit a record high on Tuesday as Alphabet's blowout results sparked a rally in high-growth stocks and bolstered expectations of a robust earnings season, while a rise in oil and metal prices boosted energy and material companies.

Back home, India share markets opened the day on a flattish note. The BSE Sensex is trading up by 24 points while the NSE Nifty is trading down by 4 points. The BSE Mid Cap index opened and BSE Small Cap index both opened the day up by 0.5%.

The rupee is currently trading at 69.05 to the US$.

Meanwhile, small-caps seem to be displaying withdrawal symptoms right now.

But as Ankit Shah, Editor of Equitymaster Insider says, such corrections are a healthy part and parcel of the game of investing.

In one of his earlier editorials, he had shown how the BSE Sensex is not a truly representative market barometer. While the Sensex continues to stay steady close to its all-time high levels, the rest of the market has corrected significantly.

Recently, he carried out a similar study on the BSE Smallcap index.

Here's what he found...

The average (both mean and median) correction of the BSE Smallcap index stocks has been 38% from their respective 52-week highs.

The Rise and Fall of the Small-Cap Index

Ankit believes that the ongoing market correction could offer some fantastic buying opportunities for disciplined and patient small-cap investors.

Moving on... Sectoral indices have opened the day on a mixed note with metal stocks and healthcare stockswitnessing maximum buying interest. While, consumer durables stocks and IT stocks have opened the day in red.

In the news from the paints sector. In the latest development, Asian Paints, one of the largest paint companies in India, started off the financial year 2018-19 with 30% profit growth in June quarter, backed by operational performance and product price hike. The growth was also due to low base in the previous year.

Consolidated profit for the quarter stood at Rs 5.7 billion, which increased from Rs 4.4 billion in corresponding period last fiscal.

Revenue from operations grew by 15.1% year-on-year to Rs 43.9 billion with double digit volume growth in the decorative paint business.

EBITDA (earnings before interest, tax, depreciation and amortisation) shot up 31.4% year-on-year to Rs 8.7 billion and margin expanded by 250 basis points to 19.9% in Q1FY19.

Asian Paints said it is taking steps to pass on the benefit of GST rate reduction to the customers but it is seeing a continuous increase in raw material prices and expects an inflation of almost 10% in the second quarter.

The company further said it has passed only a part of this impact through the cumulative 3.3% price increases taken in March and May and should have ideally looked at further price increase.

On July 21, GST Council reduced rate on paints, wall putty and Varnish to 18% from 28%.

Further, its international operations faced challenging conditions with issues like forex unavailability, difficult weather conditions impacting business performance.

Asian Paints share price opened the day down by 2.2%.

Moving on to the news from IPO space. HDFC Asset Management Company, the joint venture between Housing Development Finance Corporation and Standard Life Investments, has opened its initial public offering for subscription today.

This is the sixth public offer of the current financial year 2018-19, after TCNS Clothing, Varroc Engineering, RITES, Fine Organics Industries and Indostar Capital Finance.

The price band of the issue is set at Rs 1,095 to Rs 1,100 apiece.

HDFC Asset Management Company (HDFC AMC) is the asset management arm of Housing Development Finance Corporation (HDFC Ltd). Promoted by HDFC in 1999, Standard Life Investments (SLI) acquired 26% stake in HDFC AMC in 2001, and now the company operates as a joint venture between HDFC and SLI.

The company has been the largest AMC in India in terms of equity-oriented AUM since the last quarter of FY11.As of March 31, 2018, its proportion of equity-oriented AUM to total AUM was at 51.3%, which was higher than the industry average of 43.2%. Equity-oriented schemes generally have a higher fee structure than non-equity-oriented schemes, and this is where HDFC AMC wields its competitive advantage.

To know our view on this IPO, you can read our IPO note on HDFC Asset Management Company Ltd (requires subscription).

IPOs seem to be back in action as eighteen initial public offerings (IPOs) in the first six months of 2018 raised Rs 236.7 billion. This compares to Rs 120 billion that thirteen companies raised via IPOs in the year-ago period.

Note that the stock market is gearing up for a burst of IPO activity, with at least 12 companies planning to raise more than Rs 170 billion over the next two months, after a quiet start to the June quarter.

Also, according to EY India IPO Readiness Survey Report, globally, Indian exchanges recorded the highest IPO activity as the country saw 90 IPO launches that raised US$ 3.9 billion in the first half of this year.

We believe a merit-based selection, primarily including valuation, business, and management quality, is the logical way to go about investing in IPOs. If it means going against the herd, so be it. And going by recent past, this strategy has been proven to be successful more often.

To know how to safely profit from the ongoing IPO rush, download this FREE report now and discover How to Get Rich with IPOs.

To get more updates on share market, click here.

This article was originally published in English at www.equitymaster.com

Read the complete Indian stock market update. For the terms of use, go here.

Monday, 23 July 2018

HAVELLS IND at All Time High; BSE CONSUMER DURABLES Index Up 0.7%

HAVELLS IND share price has hit an all-time high at Rs 625 (up 2.01%).

Meanwhile, the BSE CONSUMER DURABLES Index is at 20,381 (up 0.67%).

Among the top gainers in the BSE CONSUMER DURABLES Index today are HAVELLS IND (up 2.01%) and TTK PRESTIGE (up 0.66%)

PC JEWELLER (down 0.05%) and SYMPHONY LTD (down 0.50%) are among the top losers today.

Over the last one year, HAVELLS IND has moved up from Rs 461 to Rs 625, registering a gain of Rs 164 (up 35.05%).

The BSE CONSUMER DURABLES has moved up from 16,136 to 20,381, registering a gain of 4,245 points (up 26.23%) during the last 12 months.

The top gainers among the BSE CONSUMER DURABLES Index stocks during this same period were VIP INDUSTRIES (up 142.43%), BAJAJ ELECTRICALS (up 76.45%) and TITAN COMPANY (up 61.16%).

What About the Benchmark Indices?

The BSE Sensex is at 36,869 (up 0.37%). The top gainers among the BSE Sensex stocks today are BHEL (up 1.95%), MARUTI SUZUKI (up 1.46%) and HIND. UNILEVER (up 1.32%). Other gainers include TATA STEEL (up 1.27%) and TATA MOTORS (up 1.16%). The most traded stocks in the BSE Sensex are M&M and POWER GRID.

In the meantime, NSE Nifty is at 11,129 (up 0.34%). The top gainers in the NSE Nifty include ACC LTD (up 11.68%), AMBUJA CEMENT (up 8.33%) and GRASIM IND. (up 5.27%). Other gainers include UPL LIMITED (up 3.31%) and ULTRATECH CEMENT (up 3.00%).

Over the last 12 months, the BSE Sensex has moved up from 32,246 to 36,869, registering a gain of 4,623 points (up 14.29%).

HAVELLS IND Financial Update...

HAVELLS IND net profit grew 8.3% YoY to Rs 2 billion for the quarter ended June 2018, compared to a profit of Rs 2 billion a year ago. Net Sales rose 32.1% to Rs 26.0 billion during the period as against Rs 19.7 billion in April-June 2017.

For the year ended March 2018, HAVELLS IND reported 16.6% increase in net profit to Rs 6.9 billion compared to net profit of Rs 5.9 billion during FY17.

Revenue of the company grew 25.0% to Rs 83 billion during FY18.

The current Price to earnings ratio of HAVELLS IND, based on rolling 12 month earnings, stands at 48.6x.

This article was originally published in English at www.equitymaster.com

Read the complete Indian stock market update. For the terms of use, go here.

Sensex Opens Marginally Higher; Asian Paints & ITC Top gainers

Asian stock markets are higher today as Japanese and Hong Kong shares show gains. The Nikkei 225 is up 0.6% while the Hang Seng is up 1.4%. The Shanghai Composite is trading up by 1.5%. Meanwhile, the benchmark US S&P 500 index and the Nasdaq index rose on Monday as a jump in 10-year bond yields boosted financial sector stocks and investors anticipated continued strength in corporate earnings and US economic growth.

Back home, India share markets opened the day on a firm note. The BSE Sensex is trading up by 112 points while the NSE Nifty is trading up by 27 points. The BSE Mid Cap index opened up by 0.4% while BSE Small Cap index opened the day up by 0.3%.

The rupee is currently trading at 68.85 to the US$.

All the sectoral indices have opened the day in green with metal stocks and PSU stocks witnessing maximum buying interest.

In the news from the telecom sector. In the latest development, putting an end to the speculation on whether or not the Vodafone-Idea Cellular merger would be delayed over the spectrum charge demand made by the Department of Telecommunications (DoT), the two companies have deposited a total of Rs 72 billion in cash and bank guarantee.

With the financial dues out of the way, the merger of Vodafone and Idea Cellular is likely to be approved in the next few days.

The companies have deposited a bank guarantee of Rs 33.2 billion for one-time spectrum charges and Rs 39.3 billion cash for spectrum liberalisation.

Having made the payment, the merged entity, to be called Vodafone Idea, could still challenge the dues, the reports noted.

The firms have sought a recalculation of dues, but the DoT is yet to respond. To avoid a delay, the companies decided to pay the whole amount demanded by the government.

Any further delay could have cost the two debt-ridden firms heavily.

Vodafone Idea will be the country's largest telecom operator, with a revenue market share of around 37.4% and more than 438 million subscribers. The UK-headquartered telecom major, Vodafone, had announced the merger of its India operations with Kumar Mangalam Birla-led Idea Cellular in March last year.

The companies were hoping to complete the merger by the end of June but the process got delayed by a month. The DoT had given a conditional nod to the merger a couple of weeks ago if they paid up Rs 72 billion as spectrum charges.

After issuing the final letter of approval, the DoT will transfer Vodafone India's licences to Idea Cellular. The department will also start transferring Vodafone's bank guarantees for deferred spectrum payments to Idea Cellular.

The merger of Vodafone Idea is expected to alter the telecom market in the country, making it a three-player universe of two big incumbents and disruptor Reliance Jio.

In just 18 months of commercial operations, Jio has captured a revenue market share of around 20%.

Recently, Bharti Airtel (India) CEO Gopal Vittal had said that the telecom sector was set to have just three big players holding similar market share.

If that theory holds, Vodafone Idea could lose some market share as Airtel and Jio are expected to continue to exert pressure on margins. The combined debt of Vodafone India and Idea, estimated at around Rs 1.1 trillion, will be an added burden on the margins, the reports noted.

Speaking of telecom sector, the whole telecom business has been an underwhelming story so far. While the telecom subscriber base has increased from 300 million in 2008 to 1.2 billion in 2017, investors have little to cheer. The BSE Sensex has gone up 3.25 times in nine years, but the BSE Telecom Index has not moved from its levels of 2008, as can be seen from the chart below:

Telecom Sector: A Decade of Underperformance

Here's what we wrote about the struggling telecom sector in one of our issues of The 5 Minute WrapUp:

Telecom companies are straddled with high debt, intense competition, and lack of pricing power. High spectrum costs and regulatory issues have hampered the sector. While consumers have benefited from low costs and new players fighting for their share, investors have suffered.

With the entry of Reliance Jio, the competition has intensified further. Reliance Jio's low cost offerings and strategy of capturing market share will further dent the sector. The sector has been a classic 'valuet trap'. While it always looks cheap compared to other sectors, it has failed to provide any reasonable returns. We also believe the situation is unlikely to change in the near future. For an investor, it's important to differentiate between 'value' and 'value traps'.

Idea Cellular share price opened the day up by 3.3%.

Moving on to the news from oil & gas sector. As per an article in a leading financial daily, Indian Oil Corporation Ltd would invest a total of around Rs 120 billion in the Haldia refinery and pipeline infrastructure in West Bengal.

Reportedly, the Haldia refinery's capacity would be increased from 7.5 mmtpa to 8 mmtpa, and will undertake the transition to BS-VI compliant fuel by April 2020.

Further, the state-owned company would invest Rs 76 billion in the refinery.

LPG bottling plants at Durgapur and Kalyani would be connected by pipeline, which would be brought from Paradeep via Haldia. The Budge plant would be connected later. This would entail an investment of Rs 43.3 billion.