Re-rating of Axis Bank's stock may continue in the near-future, believe analysts, as the risk-reward on the stock remains favourable amid healthy financials. The bullish stance comes after the Mumbai-based lender delivered a strong outperformance in the March quarter of fiscal year 2023-24 (Q4FY24) on core pre-provision profit and net profit, with improving asset quality. Axis Bank's net interest margin (NIM) expanded, against expectations, even in a tough market.
Edtech major Byju's will launch the Initial Public Offering (IPO) of its test preparatory arm Aakash Education Services Limited by middle of next year, the company said on Monday. Aakash Education Services Limited (AESL) revenue is on track to reach Rs 4,000 crore with an EBITDA (operational profit) of Rs 900 crore in the fiscal year 2023-24, the company said in a statement. "Byju's... will launch the Initial Public Offering (IPO) of its subsidiary, Aakash Education Services Limited (AESL) mid next year," Byju's said in a statement.
Reliance Industries Limited (RIL) has been one of the top performing companies in the large cap space under the chairmanship of Mukesh Ambani and has beaten the broader market both in terms of earnings growth and shareholder returns. In the last 20 years, RIL's net profit has grown at a compound annual growth rate (CAGR) of 15.7 per cent while its net sales have grown at a CAGR of 15.1 per cent. RIL's net profit at consolidated level has jumped 18.5 times in the last two decades growing from Rs 3280 crore in FY02 to Rs 60,705 crore in FY22; its net sales grew 16.6 times from Rs 42,129 crore to Rs 6.99 trillion.
Understand the pros and cons of SGBs before rushing to invest in them based on past returns.
India's first $1 trillion company by market capitalisation (mcap) is achievable by 2032 and HDFC Bank and Reliance Industries (RIL) are seen as lead contenders, ICICI Securities said in a note on Monday. To achieve this, the shares of both the firms will have to appreciate at least 20 per cent annually for the next decade. ICICI Securities believes this is possible if India's gross domestic product (GDP) growth accelerates to 9 per cent per annum and corporate profitability cycle peaks. "Our calculations suggest that India's first $1 trillion mcap stock could emerge by 2032.
'This was earlier driven by industries and the commercial sector.'
Since March 2020, when the Nifty50 plummeted to 7,511 following the announcement of a nationwide lockdown, the stock market has been on an upward trajectory. Over the next four years, the major market index has delivered a remarkable compounded annual growth rate (CAGR) of over 31.5 per cent. In the past year alone, the Nifty50 has gained by 27 per cent, hitting a succession of record highs.
The past 18 months have seen a resurgence in the real estate industry, with developers regaining the ground lost to the Covid-19 pandemic. But it is once again adding inventory at a pace faster than sales. The industry's inventory rose by 28 per cent year-on-year (Y-o-Y) in H1FY24, com-pared to a 25.5 per cent year-on-year increase in net sales during the same period.
The recent price correction in broader markets has hit cement companies hard. So far in the current month, smallcap firms like Visaka Industries, Andhra Cements NCL Industries, Sahyadri Industries, and KCP have lost 19.7 per cent, 14.3 per cent, 13.8 per cent, 13.5 per cent, and 11.5 per cent, respectively. On the contrary, largecap companies, while registering losses for the month, have seen a softer blow.
In the longer-term, analysts expect IHCL to see revenue CAGR of 15 per cent between FY23 to FY25 and Ebitda CAGR of 20 per cent in the same period. Analysts are seeing targets of around Rs 375-Rs 380 for the stock, which is a significant upside from the current Rs 313.
Shares of Mukesh Ambani-owned Reliance Industries Limited (RIL) rose nearly 1 per cent on Tuesday, hitting an intraday high of Rs 2,986.05 per share, after most brokerages reacted positively to the company's March quarter (Q4FY24) results. The bullish outlook stems from Reliance Jio's potential tariff hikes, given the competitive landscape, along with slow but steady improvement in the oil-to-chemical (O2C) vertical.
Zee Entertainment Enterprises Ltd (ZEEL) is seeking rapprochement with Sony Group as it makes a last-ditch effort to resurrect a $10 billion merger, according to industry sources. After the Japanese multinational firm pulled the plug on its $10 billion merger deal in January, the Indian company reached out again to Sony to reconsider the termination and offered for talks this month, a source said. On the other hand, Sony is understood to be evaluating the proposal from Zee.
7 states account for over 80 per cent of the total direct tax collections by the Union government.
The S&P BSE Midcap and the S&P BSE Smallcap indices have managed to stay afloat in a volatile January that saw the frontline indices hit their respective 52-week high levels and then slip. While the S&P BSE Sensex has lost over 2 per cent thus far in January, the S&P BSE Midcap and the S&P BSE Smallcap indices have gained nearly 2.5 per cent and 4 per cent, respectively during this period.
24x7 power supply to farmers emerges as a political lightning rod in the state.
Air India has ordered 470 aircraft to serve the Indian economy and is set to receive a new aircraft every six days over the next 18 months, CEO and MD Campbell Wilson said on Friday. He was speaking at the 67th Assembly of Presidents of the Association of Asia Pacific Airlines here. "We have new aircraft, we are recruiting many, many new crew and staff, improving the training regime and there is more work to do and we are making good progress," he said.
Weakness in HDFC Bank's net interest margin (NIM) might have bottomed out in the July-September quarter (Q2-FY24), analysts said on Tuesday, as most of the merger-related one-time adjustments have been done. The bank, they believe, should be able to grow from here on, allowing the stock to reverse its underperformance. "The weak NIM print was not unexpected given the merger and regulatory impact caused by the incremental cash reserve ratio (ICRR; 5-10 bps for the quarter).
India's biggest non-bank finance company, Bajaj Finance (BAF), is set to raise capital after a gap of four years. On October 5, the board of directors will meet to approve the fund raise by way of preferential issue and/or qualified institutional placement (QIP) subject to regulatory and shareholder approvals. The move, analysts said, comes ahead of expectations, and could be in the wake of simmering competition in the consumer lending space, especially with the launch of Jio Financial Services (Jio Fin). "While we still do not have finer details on the game-plan of Jio Financial, it has plans to initially foray into consumer and merchant lending.
At a time when investors are preferring higher-risk investment products like thematic and small-cap mutual fund (MF) schemes, some fund houses are exploring the possibility of going further down the market-capitalisation (m-cap) ladder to unearth newer investment opportunities. HDFC MF had filed papers with the capital markets regulator - the Securities and Exchange Board of India (Sebi) - earlier this year for an active micro-cap scheme. Some more fund houses are keen on launching such schemes, say industry observers.
'A cutback in hiring and compensation growth by IT companies will have a significant impact on consumer demand, especially in the urban sector of the economy.'
Trade generic drugs (medicines that are sold directly through distributors) are fast becoming a key segment for domestic pharma firms as volume growth slows in the overall market. Big companies like Cipla and Alkem have a significant presence in the segment but recently, players like Torrent Pharmaceuticals and Dr Reddy's Laboratories (DRL) have also entered this market. What is driving big pharma's focus on trade generics? The volume growth in the Indian Pharma Market (IPM) has come down from 5.6 per cent in FY16 to 0.1 per cent in FY23.
For most investors, a fund's performance on the net asset value appreciation front is sacred i.e. returns is the only parameter to be considered while making an investment decision.
Notwithstanding expectations of a pick-up in construction activity during a seasonally strong January-March quarter (fourth quarter) of 2022-23 (FY23), analysts are cautiously optimistic about the building material sector - encompassing paints, pipes, wood panels, tiles, metals, and cement - as volatile input costs, coupled with fears of a global slowdown, are making demand projections uncertain. Against this backdrop, analysts suggest investors stay selective and pick stocks of companies with stronger brand recall, expanding distribution network, diversified product profile, healthier balance sheet, and sustainable cash flow. "The government's various proposals under Budget 2023-24 (FY24) may lead to the building material segment growing between 8 per cent and 12 per cent for the next five years.
In August, the Reserve Bank of India Governor Shaktikanta Das held a meeting with chief executive officers/ managing directors (CEOs/ MDs) of large non-banking financial corporations (NBFCs). The discussions included diversifying borrowing sources for NBFCs and housing finance companies (HFCs) to contain increasing reliance on bank borrowing, risks associated with high credit growth in retail segment in unsecured loans, prioritising IT upgrades and cyber-security, improving provisioning, monitoring of stressed exposures and slippages, ensuring robust liquidity and asset-liability management, ensuring transparency in pricing, creating robust grievance redress mechanisms.
Consumption-related stocks, such as hotels, and quick service restaurants (QSRs), have been hitting the ball out of the park ahead. On the other hand, the Miss World Pageant scheduled for later this year in New Delhi, too, could provide some tailwind to these stocks, especially hotels and aviation. However, analysts suggest investors put their best foot forward and buy these counters only on a decline given the recent rally and economic headwinds.
HDFC Bank's market capitalisation (market cap) touched Rs 13 trillion in Thursday's (December 28, 2023) intra-day trades as the largest private sector lender is set to report its sharpest monthly rally in the past two years. At 10:33 AM; HDFC Bank's market cap stood at Rs 13.03 trillion, the BSE data shows. The stock was up 1 per cent at Rs 1,717.90 in intra-day trades on December 29, inching towards its record high of Rs 1,757.80 touched on July 3, 2023.
The finance ministry on Thursday sought to clarify that there was no distress in household savings and the data indicated that changing consumer preference for different financial products was the real reason for the change in the pattern of household savings. The clarification comes in the backdrop of Reserve Bank of India data showing that household net financial savings rate is at its lowest in decades, at 5.1 per cent of GDP in FY23 compared to 7.2 per cent of GDP in FY22. The divergence in the data for household gross financial assets and liabilities is not a cause for concern for the government, as the loans have largely been taken to buy real assets or automobiles, the finance ministry said.
Tata Realty and Infrastructure, a subsidiary of Tata Sons, is looking to expand its business with over 50 projects across major cities in India, Sri Lanka, and the Maldives. The combined projects boast a development potential exceeding 51 million sq ft, according to a top executive. The Mumbai-based real estate major has completed the first phase of project developments in Male (the Maldives), and is gearing up for the second phase. It has also expanded its footprint in Sri Lanka and plans to add about 2 million sq ft. in Colombo.
The share of foreign companies in private sector investments, directed towards building new factories and other facilities, has declined over the past six months. A mix of large domestic announcements and relatively lower growth in foreign capital expenditure (capex) plans have played a role, although foreign investments remain near record levels. The share of foreign companies in the overall private sector investments over the four quarters ended June 2023 has dipped to 14.9 per cent, as shown by a Business Standard analysis of data from the project tracker Centre for Monitoring Indian Economy.
The move to demerge the hotel business into a separate entity by ITC has brought back focus on hotel stocks, which have already seen a good run thus far in fiscal 2023-24 (FY24). Analysts believe there could be more gains in store over the next one year for the stocks in this sector, but suggest investors put in money on a correction only from a long-term perspective. Hotel stocks, according to A K Prabhakar, head of research at IDBI Capital, have seen a good run as travel picked up post Covid in India. Not only have the room rents increased, the occupancy, too, has surged.
UltraTech Cement's third quarter of financial year 2023-24 (Q3FY24) performance saw a combination of 6 per cent year-on-year (Y-o-Y) volume growth and 8 per cent revenue growth coupled with better realisations per tonne. The earnings before interest, taxes, depreciation, and amortisation (Ebitda) stood at Rs 3,250 crore and Ebitda per tonne was Rs 1,191. Profit after tax (PAT) was reported at Rs 1,780 crore. Other income dipped and interest costs rose.
Reliance Industries (RIL) was the top-performing index stock on Friday (May 26) and closed the day with gains of 2.8 per cent, against a 1 per cent rise in the benchmark S&P BSE Sensex during the day. RIL's performance on the bourses on Friday was, however, an exception, and the stock has struggled to beat the broader market for nearly two years now. The company's share price is currently at the same level as in September 2021, while the benchmark index is up 6 per cent in the period.
Hindustan Unilever Ltd on Friday reported a 1.08 per cent increase in consolidated net profit at Rs 2,508 crore in the third quarter ended December 2023. The company had posted a consolidated net profit of Rs 2,481 crore in the same quarter last fiscal, Hindustan Unilever Ltd (HUL) said in a regulatory filing. Its revenue from sales of products was marginally down to Rs 15,259 crore during the quarter.
The question is: Will the company have a strong balance sheet to support this massive investment plan?
Logistic players have seen a sharp correction at the bourses over the past six months as intense competition from new-age-tech startups, higher freight rates, and weak macros dented listed players' growth outlook. Analysts warn that the emergence of tech-based startups could weigh on organised players' profit-pool, and can potentially erode their market share. Thus, a stock-specific strategy would be prudent at this juncture with focus on companies that are rapidly innovating and investing in technology.
'What will matter in 2024 from the market standpoint is the direction of interest rates globally, as well as in India.' 'The results of the general elections will also be keenly watched.'
Tata Communications has seen analyst upgrades after reporting Q3FY24 results. The biggest factor is the visible signs of a turnaround in its new acquisition, Kaleyra. The consolidated revenue grew 16 per cent Q-o-Q to Rs 5,630 crore led by 15 per cent Q-o-Q improvement in the data segment.
New investment projects announced in the manufacturing sector declined in the three months ended June 2023. The value of new projects was lower than in the March quarter, as well as the year-ago period, shows data from project tracker the Centre for Monitoring Indian Economy (CMIE). The new project announcements worth around Rs 85,000 crore in the manufacturing segment in June were a 48 per cent decline from the Rs 1.6 trillion in March and a 66 per cent decline from the Rs 2.5 trillion seen in June 2022.
Among index funds, the most popular products are funds tracking the Nifty 50 and Sensex, says Dwaipayan Bose, and explains the finer points of selecting the right index mutual fund.
At Rs 919 crore, InterGlobe Aviation, the parent firm of low-cost airline IndiGo, posted its best-ever fourth quarterly net profit in the January-to-March quarter (Q4) of financial year 2022-23 (FY23). The bottom-line, however, was lower than the Street's expectations where estimates ranged from Rs 1,160 crore to Rs 2,180 crore. On the bourses, shares of IndiGo have added just 30 paise (0.01 per cent) since the announcement of the Q4-FY23 results on May 18.
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