Trade Talk | Here are the top stock to keep on your radar going into trade. #BQLive
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00:00 Hello and welcome to BQ Prime. A very good morning to all the viewers. You are watching
00:04 Trade Talk and I am Hiral Dadia. Clearly, a second consecutive session of gains is what
00:09 we have seen in the markets in yesterday's session. And it seems that the movements have
00:14 been pretty steady yesterday as well because clearly it is mainly the pharma as well as
00:19 the IT pack that has been leading these kinds of gains. In fact, the pharma index did hit
00:24 a record high level in yesterday's session and ended with gains of almost a percent and
00:30 a half. Clearly, there was some bit of buying interest that was coming in the auto capital
00:35 goods as well as the real estate space. But it was interesting to see how M&M was one
00:40 of the top gainers in yesterday's session which ended with gains of little over 4%.
00:44 However, you did have Tata Motors as well as Bajaj Auto which ended with cuts in yesterday's
00:50 session. If you talk about Bank Nifty as well, it was a pretty sideways move that we have
00:55 been witnessing with regards to Bank Nifty and there is no differential with regards
00:59 to the private banking space as well as the PSU banking space. And there is that bearishness
01:05 that continues to remain with regards to the banking names. Clearly, what analysts are
01:10 indicating is that this is a buyer's market but buy on dips is the kind of strategy that
01:17 investors should be adopting because any dips in the markets should be used as buying opportunity
01:24 because everyone is still eyeing the 20,000 mark in terms of Nifty 50. Now, the timing
01:31 is something that we should be waiting and watching. Overall, if you see, let's quickly
01:35 look at the F&O and the technical side of the markets. If you see the open interest
01:40 buildup, that's indicating a buildup in terms of long positions and index futures and this
01:45 is coming in for a second consecutive session. Earlier, if you see, the trend was that the
01:49 shorts were increasing in the system but now the tables are turning and again, you are
01:53 seeing the longs that are increasing. Support in terms of Nifty is coming in at 19,300 to
01:58 19,400. So, that's the zone that we are eyeing. And on the call side, the highest OI was observed
02:04 at 19,700 which was then followed by 19,800 and on the put side, the highest OI was at
02:10 19,500 strike. Now, once we cross 19,800 in terms of Nifty 50, a further upside potential
02:18 is what is envisaged as well. Let's quickly look at Bank Nifty as well. The support is
02:24 coming in at 44,500 to 44,600 levels while resistance is placed at 45,200 to 44,350.
02:31 Now, if you talk about the open interest buildup, maximum is seen at around 45,000 levels in
02:37 terms of Bank Nifty. And it's interesting to see how call writers are existing from
02:42 the 45,000 strike and that continuous exit is something which can actually fuel a rally
02:49 in terms of Bank Nifty. So, that is a level which is going to be crucial to watch out
02:53 for. And if there is a break below those 44,300 levels in terms of Bank Nifty, there is a
02:59 possibility of profit booking or longs that are built, they will be unwound as well. So,
03:05 watch out for these levels pretty closely in terms of Bank Nifty as well.
03:09 But let's quickly take a look at the stocks in yesterday's session, which actually increased
03:13 with a high amount of volume buildup. One was Divas Laboratories from the PharmaPak.
03:18 That stock has been doing pretty strong over the last couple of trading sessions. And analysts
03:22 are of the opinion that the month of August itself is going to continue to remain strong.
03:26 But apart from Divas Laboratories, you had Biocorp and Syngene from the PharmaPak as
03:31 well, which did see a good up move with high volumes as well. Eminem, as we already spoke
03:36 about, also saw some smart moves. And this is mainly on the back of the commentary that
03:40 we've heard from the management with regards to where the RBL Bank stake purchase goes,
03:46 the stance on that. Secondly, the investment that has come into Eminem's EV business by
03:52 Temasek. And thirdly, the company's plan with regards to the EV business as well. So, overall,
03:59 what's brewing with regards to Eminem and the kind of sell-off that we saw last week,
04:03 that's something which is again brewing that investor sentiment back into the counter.
04:07 So lots of movers and shakers in trade to watch out for. But let's quickly look at the
04:12 macro side of it. You have the RBI monetary policy, which is right on the back of it.
04:17 You could see volatility specifically in terms of rate sensitives as well as Bank Nifty as
04:22 well. As we know, the policy meeting starts today and the decision will be announced on
04:28 the 10th of August. So watch out for the RBI policy pretty closely and the rate sensitives
04:34 that will be in focus between today as well as the 10th. So that's going to be a space
04:39 that we will be watching out for. But let's move on to earnings. It's the last leg of
04:44 earnings that have been trickling in as well. Yesterday, Sesa did get us what was the expectation
04:51 from GCPL, which reported earnings post-market as, in fact, Mika is now standing by to give
04:56 us more in terms of what has come out of it and has met street expectations. Good morning,
05:02 Mika. Good morning. What have been the key highlights from GCPL because FMCG as a sector
05:06 has been on a positive trend over the last couple of trading sessions? Yes. So basically,
05:12 the company reported 10% revenue growth and 28% EBITDA growth this quarter. However, these
05:17 numbers missed the analyst estimates. The EBITDA margins marginally beat the estimates
05:22 as it stood at 19.8%. The company also reported an 8% fall in its net profit to Rs 318.82
05:29 crores. However, this profit degrowth was due to one-time costs that was incurred by
05:34 the company due to the Rehman merger last quarter. Excluding the one-time costs, the
05:38 company has seen a 19% profit growth this quarter. The company's India Business Sales
05:43 grew by 9% to Rs 2,005.48 crores, which was led by a volume growth rate of 12% this quarter.
05:50 The home care segment showed the highest sales growth of 14%. And the unbranded and exports
05:55 segment grew 1% to Rs 62 crores. The company has also approved a CAPEX spend of Rs 900
06:01 crores for setting up new manufacturing sites in Tamil Nadu and Madhya Pradesh. The new
06:05 sites will add approximately 20% capacity to the home and the personal care segments,
06:10 which are currently at a capacity utilization of 75% to 80%. The manufacturing sites will
06:16 come in stream in approximately 18 to 36 months and will be financed by a mix of internal
06:21 approvals and debts. The sites aim to cater to the growing demand of the customers in
06:26 the segments of home care and personal care and in total consolidate the manufacturing
06:32 footprint of the company. On a category-wise performance this quarter, home care showed
06:36 the highest growth. Personal care rose 2%. The household and sector sites continued to
06:41 show double-digit growth momentum. And the personal wash segment continued to deliver
06:46 volume-led growth. The personal wash segment saw lesser value growth due to the price cuts
06:50 in the soaps. These benefits were passed on to the consumers by the company. And lastly,
06:55 on the international front, Indonesia had the highest year-on-year sales growth of 15%
07:00 in constant currency terms. The EBITDA margins improved by 420 basis points, which was led
07:05 by trade promotion reduction. And the company plans to focus on the category development
07:10 and increase in media investments for the Indonesia part of their business. And sales
07:15 in Africa, in the US and Middle East grew 16% in constant currency terms, while that
07:20 in Latin America grew by 79%. I also have some brokerage notes. Nomura maintained its
07:25 buy rating with a price target of 1,225 rupees. The broker says that the devaluation of Naira
07:31 will impact the overall sales growth by 200 basis points. And Jeffries maintained its
07:36 buy rating with a target price of 1,200 rupees. And the broker just cut off its 2024-2026
07:42 EPS estimates by 3-4% to fatten the forex depreciation in Nigeria. And the India EBITDA
07:50 margin of 28% was highest in the last two years.
07:54 And that's an interesting one to watch out for. Thanks, Mika, for getting us the details.
07:58 So that's for GCPL. And it's interesting to see how the CAPEX plan of 900 crores is going
08:03 to pan out as well. But apart from this, Mika, you have a whole host of other earnings from
08:08 the broader markets as well. Which are the names that you've been tracking?
08:10 Okay, so first, we have Metplus Healthcare Services, which missed revenue estimates but
08:15 beat EBITDA, net profit and margin estimates. Revenue was up 29% and EBITDA grew 35%. And
08:21 margins improved by 36 basis points. The net revenue showed marginal, the net profit showed
08:27 a marginal growth of 2.3%. The company as of Q1 has 3,975 stores across India. And the
08:34 quarter saw accelerated store expansion with an addition of 153 stores.
08:38 Next, we have Soba Limited. The company showed weak results as it missed revenues on all
08:42 fronts. Revenue was up 61%, EBITDA was down 10%, and margins fell by 5% to 7%. The company's
08:50 net loss also grew to 12 crores this quarter compared to the 4.5 crores in the year-ago
08:55 period. The real estate margins were lower this quarter due to the recognition of projects
08:59 that were sold pre-COVID and the constructions that were completed on an inflated cost basis.
09:05 On the segment performance, the luxury segment demand has been seen growing significantly
09:10 in the last few quarters. And it has grown to 49% of the sales contribution in quarter
09:15 one compared to 36% in FY2023. And Bangalore contributed to 54% of the overall sales. And
09:22 lastly, we have PB Fintech that reported a 32% revenue growth. The company had an increased
09:26 EBITDA loss of 65 crores compared to the 30 crores in the year-ago period. However, its
09:31 net loss decreased to 11.9 crores this quarter compared to the 204 crore loss that was there
09:38 last year. The company's core online business grew 39% year-on-year, while its new protection
09:44 business grew 40% year-on-year.
09:46 Thanks, Meeka, for getting us the details. So that's a list of a couple of healthcare
09:51 companies also that have reported numbers. But moving on, a lot of chemical companies
09:56 that have reported numbers as well in yesterday's session. In fact, Varsha is standing by to
10:00 get us more details. Varsha, a whole host of companies that you've been tracking, what's
10:04 the trend suggesting?
10:05 Yeah, so as you know, the chemical companies, there are headwinds in chemical companies
10:09 and few chemical companies which have reported numbers yesterday, the numbers were not that
10:15 good. So first, we have Sardana Nitrochem. So while the revenue was up 43%, but there
10:20 was a degrowth in net profit, almost 95%. Now, this was due to increasing depreciation
10:25 and finance costs. Plus, last year, company had a negative tax expense, while this year,
10:30 a company had a positive tax expense of 0.41 crores. The next company that we have is Tata
10:35 Chemicals. Again, the revenue was up 6%. But if you see, the higher revenue was on account
10:42 of better realizations, partly impacted by lower volumes. Also, the part, if you see,
10:48 is lower due to higher taxes in some geographies plus higher finance costs. The next company
10:53 that we have is Rainbow Children's Medicare. Now, if you see, there was a healthy growth
10:59 in revenues on account of increasing pediatric surgical cases and deliveries. Plus, being
11:05 a children's hospital, quarter one is a weak quarter due to seasonality and the fact that
11:10 the families go out for summer vacations. The next company that we have is Bayer's CropScience.
11:16 Now, revenues were up 4.3%, while net profit was up 8.55%. But now, there was this price
11:22 normalization impacting the overall sales growth of the quarter, plus cotton seeds continue
11:27 to yield strong results with volume growth driven by portfolio and better acreages in
11:31 Kharif. The next company that we have is Foods and Eats. Now, the revenues were up 31%. But
11:37 there was this unseasonal rain this summer, which posted challenges to the beverage consumption
11:43 in Q1 of this financial year. Plus, tomato pulp continues to show promising growth, but
11:49 the company does not see as an impact as most of the contracts are cost-plus in nature.
11:55 The next company that we have is Gokaldas Exports. Now, revenues were down 15%, while
12:00 EBITDA was down 16.7%, and the net profit was also down 17.4%. The last company that
12:06 we have is Mangalore Chemicals and Fertilizers. Now, the revenues were down due to low realizations
12:12 that we are seeing in all the chemical companies. Plus, there was growth in EBITDA due to decrease
12:17 in expenses, the total expenses. Right. So, that's going to be an interesting
12:20 pack to watch out for. Thanks, Varsha, for getting us the details. But moving on, we'll
12:25 have Saloni, who will be getting us more details in terms of a whole host of other numbers
12:30 that have been reported from the broader markets as well. Saloni is here to get us more. Saloni,
12:36 good morning. What's on your list in terms of the earnings?
12:39 Good morning. So, first, we've got Torrent Pharma. So, the company missed top-line estimates
12:43 while beating bottom-line estimates. So, around 55% of the company's revenues came from India,
12:49 which was a 15% jump year-on-year. Revenues from Germany and Brazil also saw growth, while
12:54 the revenues from the US saw a decline. Next, we've got Max Healthcare. So, the company's
12:59 revenue beat estimates. Approximately 25.1% of the company's gross revenue came from oncology,
13:06 as compared to 22.7% a year ago. Cardiac Sciences and Orthopedics were the highest contributors
13:12 after oncology. Third, we've got Gland Pharma. So, the top-line and bottom-line both beat
13:17 estimates by low margins. The increase in revenue this quarter was due to the acquisition
13:22 of Synexi and the improvement of Bayes Business. The India market accounts for 7% of the quarter
13:28 revenue and it has also seen a growth of 29% as compared to a year ago. Then, we've got
13:34 Indigo Paints. So, the company saw healthy growth this quarter, beating revenue, EBITDA
13:39 and net profit estimates. The company's special focus on Tier 1 and Tier 2 cities, along with
13:44 various initiatives, aided the growth in sales by 28.8%. Fifth, we've got Jupiter Wagons.
13:52 That saw exponential rise in its top-line and bottom-line by 155% and 390% respectively.
13:58 This has been a good quarter for the company. Due to an improved product mix and the introduction
14:03 of value-added products, the company saw a good EBITDA margin. Next, we've got ADF Foods.
14:09 The company saw a 15.7% rise in revenue, while a 92.7% rise in its net profit this quarter.
14:16 There was a substantial rise in the EBITDA margins this quarter as well. And lastly,
14:20 we've got Balmer Lorry. So, the revenue saw a decline due to lower revenue from the industrial
14:26 packing and logistics services sectors. However, the net profit saw a slight rise due to decreased
14:31 expenses. Thanks for getting us the details, Saloni.
14:34 So, a whole host of numbers that are eyed from the health care pack to the chemical
14:40 companies and the others which Saloni did bring us through as well. But moving on, if
14:46 you see in terms of earnings, Coal India will be reporting numbers in today's session. It's
14:51 going to be interesting to see as to what comes out of it because clearly what the street
14:56 is saying is that there is a transformation that is eyed from Coal India. People are talking
15:01 about the rebranding that could be happening as well in terms of Coal India. So, a lot
15:06 of announcements that could be expected from there. But Vikas is standing by to get us
15:10 more details in terms of the key numbers and key points we should be watching out for.
15:15 Vikas, good morning. What do you have for us? Yeah, good morning, Kerala. As you rightly
15:20 said, a lot of expectations from the company. But for this quarter, the analysts have expected
15:26 that there will be some impact on the company's earnings because of higher employee costs
15:31 and unexpected rainfall during the quarter, especially in mid-May, which impacted the
15:36 demand and the sentiment as well as impacted the offtake from Coal India. So, as far as
15:43 revenue from operations is concerned, that will be although marginally higher by 0.15%,
15:49 but it will be impacted or has been impacted because of this rainfall, as I already said,
15:55 during the quarter and affected the offtake, which only increased by 4%, whereas it was
16:01 expected at least 7% increase in that offtake during the quarter. The revenue from operations
16:07 is expected around Rs. 35,148 crore compared with Rs. 35,092 crore, which was last year.
16:14 As far as operating profit is concerned or the EBITDA, that has been impacted by almost
16:19 30%. So, it will come to around Rs. 8,676 crore this quarter. And this has also been
16:26 impacted because of higher employee costs. So, the employee costs have been affecting
16:30 the company for the last couple of quarters. And although the company increased the tariff
16:35 for the price of high-grade coal from G2 to G10, but that is not expected to meet up the
16:42 profit or the employee cost, which has been increased. So, margin also has been impacted
16:48 by 1000 basis point. It will come around 24.68% in this quarter compared to 34.91%. And the
16:57 net profit has also been impacted by some 29% this quarter. So, net profit is expected
17:03 to be around Rs. 6,277 crore. But overall, what the analysts are expecting is that the
17:09 company is likely to do very well in FY24 because of various initiatives that the company
17:17 has taken. Also, as far as CAPEX is concerned, they have increased the target to 780 million
17:22 tonnes for this year. So, that is likely to give a lot of surplus coal also in the market,
17:28 which will go to non-regulated sectors. And the e-auction premium, although it's come
17:33 down, but the volumes will increase, which will impact the company positively. Thank
17:38 you, Ira.
17:39 Thanks Vikas for getting us the details. It's interesting to see how the EBITDA, that's
17:44 going to be hit as well during the quarter, but a slightly somber quarter is what is on
17:49 the cards. Moving on, staying with the earnings, you have two other bigger names that will
17:53 be reporting names. One is Adani Ports. It's going to be interesting to see because the
17:58 expectation is that the profit is expected to grow, and this is mainly on the back of
18:02 higher volumes as well as the M&A activity. So, watch out for Adani Ports in trade today
18:07 as well as you have Hindalco that will be reporting numbers. But the expectation is
18:12 that the profits are expected to plunge, and this is on the back of the ongoing work at
18:17 their copper plant as well. So, both of these numbers are going to be interesting to watch
18:21 out for in terms of today's session. But moving away from earnings, a whole host of other
18:26 names that are in focus on the back of news from the likes of an HDFC Bank to Amaruti
18:32 to Adani as well. Himansh is standing by to get us more details on the same. Himansh,
18:38 good morning. What's on your list for today?
18:40 So, quite a lot of key developments being made. So, Adani Green Energy for one, the
18:45 Qatar sovereign wealth arm INQ Holdings, bought a 2.7% stake in a bulk deal. The promoter
18:51 entity on the other end, Infinite Trade and Investments, sold 4.48 crore shares, approximately
18:58 2.83% at Rs. 920 apiece. This comes almost after a month where the renewable energy firm
19:05 raised funds from GQG partners and other investors. Then we have BEML, where the company has secured
19:11 a letter of acceptance from Bangalore Metro Rail Corporation, bagging a rolling stock
19:15 order, valued at Rs. 3,200 odd crores. Then we have 197 Communications, where PWC resigned
19:23 as the auditor of PTM Payment Services. This comes in since the company has a policy of
19:31 any change in the holding company auditors will result in the resignation from the subsidiary
19:36 companies as well. Then we have Lloyds Metal Energy, where the company is informed of an
19:41 accident occurrence in a district of Maharashtra. Accident caused due to overturn of a dumper
19:49 on a camper. Then RailTel Corporation of India, the company has received a work order from
19:55 Pimpri Chinchwad Smart City for over 10 years. The company is to provide end-to-end manufacturing
20:00 and monetization of city network infrastructure on a revenue sharing model. The expected revenue
20:06 from this contract is Rs. 70 crores annually, which on a recurring basis will amount to
20:11 Rs. 700 crores over the 10-year period. Then Wellspun Specialty Solutions has received
20:16 orders for up to Rs. 37 crores for the supply of stainless steel bars from a domestic customer.
20:22 And the order is expected to be executed by the end of October. Then MMTC has seen its
20:29 license revoked as a stockbroker due to its participation in unlawful paired contract
20:35 in connection with the defunct National Spot Exchange Limited. Then we have HDFC Bank,
20:40 where the bank's weightage in the FTSE indices has advanced to 1.52% from 0.81%. And the
20:48 company has also hiked its marginal cost of funds-based lending rate, MCLR, by 15 basis
20:54 points and the new rates are in the range of about 8.35% to 9.2%. Lastly, we have Maruti
20:59 Suzuki, where the board of Maruti Suzuki will be meeting today to discuss how they will
21:05 be compensating for the Suzuki Motor plant in Gujarat. They informed exchanges on Thursday
21:13 that they will be deciding whether it's going to be all cash-based or through preferential
21:18 issue of shares. So those are the key developments to watch out for. Besides these, there are
21:22 also IPO updates as well, where Concord Biotech's $187 million IPO has been subscribed by 7.09
21:31 times and the offer is set to close on 8th August. SBFC Finance's $124 million IPO has
21:37 been subscribed by over 70 times. And then there's TVS Supply Chain Sets, the price range
21:43 within the band of $187 to $197 and the total IPO is valued at around $106 million. So,
21:50 key developments to watch out for and it's interesting to see how the stocks are going
21:54 to react. Thanks, Imanj, for getting us the details.
21:56 A whole host of things, not only in the primary market, secondary market, I beg your pardon,
21:59 but a lot of action in the primary market as well. And we will be watching out for key
22:04 announcements that could be coming in from Maruti, specifically from the update as to
22:09 what's the kind of deal treatment they are going to give with regards to where the parent
22:15 plant is concerned. So, interesting ones to watch out for today's session. And clearly,
22:20 overall, in terms of trade as well, there is some bit of positivity that we are seeing,
22:24 but consolidation is what is on the cards and buy on dips is the kind of strategy that
22:30 analysts have been recommending as well, because everyone's tracking the journey to 20,000.
22:35 That's all that we have on this session. Thanks for watching BQ Prime. Lots lined up during
22:39 the day. Please stay tuned.
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