- PM Modi kicks off poll campaign
- Fed chair spooks markets again
- #Paytm cannot sell wallet business
All this and more on 'All You Need To Know' with Alex Mathew. #NDTVProfitLive
- Fed chair spooks markets again
- #Paytm cannot sell wallet business
All this and more on 'All You Need To Know' with Alex Mathew. #NDTVProfitLive
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TVTranscript
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01:23 Good morning and thanks so much for joining in.
01:25 This is NDTV Prophet.
01:27 My name is Alex Matthew and you're watching All You Need to Know.
01:30 Let's start with the headlines.
01:32 Prime Minister Narendra Modi kicks off the poll campaign,
01:36 says the BJP will get 370 and NDA 400 seats
01:40 in the upcoming Lok Sabha elections.
01:43 US markets end the day in the red on Fed's hawkish commentary.
01:48 Ten-year yield climbs to near 4.14% mark
01:51 as Treasuries see their biggest two-day loss in months.
01:55 PTM cannot sell its wallets business as it has already surrendered the license.
02:02 That's an NDTV Prophet exclusive.
02:04 Hyundai is planning to come out with a 25,000 crore IPO later this year
02:10 and that's a PTI report.
02:12 And all early rises in the Asia-Pacific region open in the red.
02:16 Australia's ASX 200 falls nearly a percent ahead of its rate decision.
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02:24 Equity markets in the US fell as the hawkish Fed commentary
02:28 or rather officials of the Fed and their commentary
02:32 dented rate cut expectations in March.
02:35 The Dow dropped about 0.7% and the S&P 500 and Nasdaq
02:39 lost about 0.3 and 0.2% respectively.
02:42 And overnight, of course, the latest data showed that
02:45 the Institute for Supply Management Service Gauge
02:48 hit a four-month high while prices picked up.
02:52 That's based on a Bloomberg report.
02:54 That pushed Treasuries to their biggest two-day loss in recent months.
02:58 The yield on the 10-year climbed to trade near the 4.14% mark.
03:04 In the Asian markets, it's also broadly risk-off sentiment that's pervading.
03:09 All of the three early rises started in the red.
03:12 In fact, you have Shanghai that is under just a tad bit of pressure as well.
03:16 Hang Seng, though, is trading in the green.
03:18 Of course, Shanghai is going to be in focus as China is tightening
03:21 trading restrictions on domestic institutional investors
03:24 as well as some offshore units as authorities fight to stem the rout
03:29 in stocks that has now gone on for more than a year.
03:33 Now, back home with the budget out of the way,
03:35 attention is now turning to the general election that's now just a few months away.
03:40 The interim budget was lauded for its pragmatism and part of that was
03:44 attributed to the confidence of the Modi government
03:47 of its prospects in the upcoming elections.
03:49 Now, Prime Minister Modi has spelled it out even more clearly.
03:53 The Prime Minister was speaking at or rather in Parliament
03:57 during a discussion on the motion of thanks to the President's address.
04:02 Listen in.
04:04 (In Hindi)
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04:15 (In Hindi)
04:40 (In Hindi)
04:43 (In Hindi)
04:46 (In Hindi)
04:50 (In Hindi)
04:53 (In Hindi)
05:20 Right, turning to the equity markets here in India
05:23 and focusing on the latest cues from the F&O space.
05:26 Agam is here to break them down for you.
05:28 Agam, it's been chop and churn.
05:31 I keep saying that, I mean, but that is the case.
05:34 We saw life highs on Friday and then yesterday just coming off a tad bit.
05:38 What do we see from the latest cues?
05:39 So, Alex, it's going to be a bit hard for the benchmarks to move beyond life highs.
05:45 At least that is what the indication is being given to us by the data
05:48 and especially when it comes to traders.
05:50 For now, of course, yesterday we did see a little more weakness come in.
05:54 After the considerably choppy session on Friday, yesterday was a tad quieter,
06:00 but we did see a little bit of, well, a decline as far as the benchmarks go.
06:05 So, about 0.4% decline for the Nifty, but no change in OI.
06:08 And the Bank Nifty, once again, that's where we saw another quarter percent,
06:12 a little over that third actually, coming off, and about 2% unwinding coming through.
06:17 So, at the moment we are looking at uncertainty as far as traders are concerned
06:21 in terms of index futures.
06:22 Moving on to how things are panning out as far as your option markets are concerned,
06:27 unwinding has come through not only in futures but in options as well,
06:30 indicated by a significant amount of decline bars that you see in this particular chart,
06:37 not only in calls but in puts as well.
06:39 Where does that leave us when it comes to your range, at least based on OI?
06:43 For now, it seems like 22,000, and as I was suggesting earlier,
06:48 is going to be a stiff, stiff resistance for the Nifty to take out in the near term.
06:53 And, of course, on the lower end we're keeping an eye on the 21.500 mark
06:57 because we continue to see the Nifty move within that 500-point range.
07:02 Today is the Finn Nifty expiry, of course, so we will be watching out
07:05 for a whole host of these financial names.
07:08 Remember that HDFC Bank, along with the IndusInd Bank, once again will be in focus today,
07:14 which is why they could have a bearing on your Finn Nifty
07:18 because they're both part of that particular index.
07:21 Let's move on and talk about stocks then and how things have come through.
07:25 Yesterday we did see shots in Zyrus Life, UPL, and Aurobindo Pharma,
07:28 and Long's and Ipca Lab and IOC.
07:31 The pharma sector, of course, has been buzzing off late,
07:34 with a short covering for Metropolis, SAIL, BPCL, and Petronet LNG,
07:38 and Long's unwinding in Hindustan Copper.
07:40 But, Alex, today it once again will be about the Finn Nifty expiry,
07:43 specifically the HDFC Bank, well, getting an RBI approval
07:48 to increase the stake by as much as 9.5% in IndusInd Bank.
07:52 Yes, interesting, very interesting update there.
07:54 And, of course, also what you pointed out on IOC and the other OMCs,
07:58 they've been buzzing and how, so we'll be talking about that also
08:02 before the start of trade, so you should watch out for that.
08:04 Let's shift attention to the earning space,
08:07 and we saw telecom operator Bharsi Airtel coming out with its third quarter numbers.
08:12 The company's net profit jumped as much as 37% and margins contracted marginally.
08:17 We've got Smriti here to break down the numbers for you.
08:19 Smriti, morning. What are the key details that stood out to you?
08:23 Well, you rightly mentioned that margin was pretty much flat, actually,
08:28 and most of the estimates, most of the results met the estimates, except ARPU.
08:34 ARPU rose to 208 as compared to 203 in the previous quarter.
08:39 That's a jump of about 2.5%.
08:41 The expectation was around 205 rupees, so that's kind of where ARPU beat estimates.
08:48 Otherwise, the rest of it, if you look at revenue, that grew about 2% to 37,899 EBITDA,
08:56 about 1.5% to 19,815 crore, and net profit, as you mentioned, jumped 37% to 2,876 crore.
09:06 Now, there was one exceptional loss that was of 130 crore.
09:10 That was a forex loss, which was on account of devaluation in Nigerian Naira
09:16 and Malawian Kwacha that impacted the profits.
09:20 But overall, if you look at it, margins remain capped due to 5G capex
09:25 that we have seen this trend in the last couple of quarters.
09:29 But 5G capex is expected to moderate from the next fiscal,
09:35 so that might have a positive impact on the profits.
09:38 Now, if you look at the mobile revenue that grew about 11.8% year-on-year,
09:42 total customer base also grew to 55 crore across 16 countries.
09:49 If you look at brokerage notes, Citi came out with its note.
09:53 It reiterated the buy on Bharti Airtel stock with a price target of about 1270,
09:59 which is about 14% up from the last day's closing.
10:03 They say they have been-- their solid execution and effective premiumization,
10:09 that is kind of contributing to their growth.
10:12 They expect a 15% 4G tariff hike in the mid of this year itself.
10:18 So that is definitely going to be a big boost for Bharti Airtel.
10:22 They see the valuations at 9X of one year forward EB by EBITDA at premium,
10:28 but still they see there is a considerable amount of upside here as well.
10:32 All right. Thanks so much, Smriti, for breaking that down for us.
10:35 Of course, shares of Bharti Airtel were under pressure in yesterday's session,
10:39 down over 3%.
10:41 Let's talk about U.S.-based asset management firm Vanguard
10:47 and the fact that it has cut Ola's valuation to $1.88 billion
10:52 from the earlier value of $3.5 billion.
10:56 Vanguard, which holds less than 1% of ANI Technologies,
10:59 which is a parent of Ola, has downmarked the company for a third consecutive time.
11:05 But remember, these markdowns have only been made in the internal books of Vanguard.
11:11 Now, we have to slip into a very quick break.
11:14 We've got more stock-specific action on the other side, so do stay tuned.
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13:31 Welcome back. You're watching All You Need to Know.
13:33 Let's focus in on a few of the stocks that you should watch out for in trade today.
13:37 Of course, there's a lot of earnings to dissect.
13:39 There's a lot of news items also based on clarifications and notifications set to the stock exchanges.
13:46 Anushi is joining in to give you her list of stocks.
13:48 Morning, Anushi. What do you have for us?
13:50 Morning, Alex. So, I'll start off with 197 Communications, that is Paytm,
13:54 which has been in news for quite some days now.
13:57 This is after the RBI cracked out.
13:59 But more than that, there was new news in this where it has denied reports of violation for its foreign exchange rules,
14:06 saying that there's any investigation by the enforcement on ICL,
14:12 and reiterating that there has been no investigation for its Paytm payments bank.
14:17 Again, the stock has been down by about 42% in just the last five days itself.
14:23 More to this, even Jio Financial Services added that they have denied reports on acquiring the Paytm wallet business.
14:30 So, that is on the 197.
14:32 Now, moving on to Inox India.
14:34 So, Inox India and Adani Total Gas have formed a partnership wherein they will be providing an LNG infrastructure for the businesses.
14:44 Now, again, both the companies have been picked out as a preferred partners.
14:48 And with this, Adani Total Gas would be able to reduce the overall carbon emissions by about 30% in the ongoing phased manner.
14:57 That is what the press release stated.
14:59 Next on the list is Indian Energy Exchange, which came out with its monthly business update,
15:05 wherein it has seen about a 26% uptick in its total volumes at about 10,893 million units.
15:12 So, just to give a segment-wise bifurcation, over here the conventional power segment stood at about 9,137 million units,
15:20 followed by the green market, which has about 236 million units, and the renewable energy, which showed about 1,520 million units.
15:28 And last on the list is SP Apparel, which has made about a 100% acquisition in Young Brand Apparel.
15:36 Now, this is a subsidiary company of the Banahari Amani Spills Limited and this consideration for Rs. 223 crore.
15:43 Again, with this, the business plans to raise about additional revenue of about 400 crores.
15:49 So, do note that in FY23, SP Apparel had about a 1000 crore of revenue as of FY23.
15:56 So, that's all for the stocks that you should be watching out for today.
15:59 All right. Thanks so much, Anushi, for breaking that down.
16:02 Of course, what you are seeing flashing in the bottom of your screen is quite a significant number.
16:07 It is based on the latest data that we've picked up that talks about FPI activity or Foreign Institutional Investor activity
16:15 in the Indian equity markets in the second fortnight of the last month.
16:21 And remember, that fortnight was characterized by heavy selling in a few financial names and particularly you had HDFC Bank.
16:30 So, while the overall FII number for the month was in the red, that is net selling,
16:35 a large part of that has come in apparently in the financial services space over 30,000,
16:41 in fact over 31,000 crore being sold in financial services stocks itself in just the second half of the last month.
16:50 We'll, of course, get you more insights over the course of the day, but that's something that you should bear in mind.
16:55 Of course, in yesterday's session, you had Foreign Institutional Investors that turned net buyer once again to the tune of about 520 crore rupees.
17:04 Let's talk about Ashok Leyland then and we've got earnings to take care of or to pay attention to
17:10 because this particular quarter was quite a quarter for Ashok Leyland with a substantial expansion in margins.
17:17 We've got Vinay joining in to explain why that has taken place.
17:21 Vinay, morning, what can you tell us?
17:23 Morning, Alex. So, the profit rose 60% and as you said, it was on sharp improvement margins
17:30 and this is in line with the company's long-term goal of improving its profitability
17:35 because the company thinks and rather the industry thinks that they need to have higher profitability
17:41 to invest in the future technologies that are coming up and there are limited players in the space.
17:47 So, that's what the thinking is and that's where they are working on.
17:50 So, if you see that sales fell 0.7% year on year to 47,241 units.
17:57 So, the sales fell even then the profits rose 60% and that was entirely due to improvement in the margins
18:04 and the lower sales are also affected in the revenues which rose just 3% on higher selling prices.
18:11 So, margin expanded 320 basis points and it was largely led by lower commodity costs.
18:17 If you can remember, the last year was very difficult for the automobile companies
18:22 as commodity costs ran a little higher and now the stabilizing effect is really clear
18:28 on the margins of all the automobile companies.
18:30 So, if you look at the commodity costs, the material cost as a percentage of sales fell to 70.7%
18:37 as compared to 79.8% last year. So, this reflects how good has this quarter been for the companies.
18:45 If you look at the perspective from the commodity costs, this as I said this reflects companies
18:51 long term pursuit of higher profitability and in an interaction on Bharat Mobility Expo,
18:56 the company CEO also told me that they are ready to sacrifice the market share
19:02 if they can get higher profitability. So, this reflects what is happening on the ground.
19:07 Alright, in fact that is quite the insight. Thanks so much Vinay for sharing that with us.
19:12 Let's talk about a few more earnings that came out yesterday and we have got Varsha joining in
19:17 to tell you about a few stocks here. Varsha, what are the stocks on your list today?
19:21 Good morning Alex. So, let's start with Prince Pipes wherein if you see profit has missed estimates.
19:28 The revenue was down 12%. Well, there was uptick in EBITDA by 238 basis points
19:35 that is at 12% versus 9% last year and if you see Q3 volume was muted.
19:41 Now, this is on the back of high base effect of Q3 FY23
19:47 and company has proposed to increase the CAPEX from 150 crore to 220 crore.
19:52 Then we have Suvin Pharmaceuticals where company has reported weak set of numbers.
19:56 Now, if you see the reasons for this weak results is industry wide inventory destocking
20:03 in specialty chemicals and also impact of COVID molecule in CDMO.
20:07 Company made one time adjustment of inventory provision of 13 crore.
20:11 So, if you see the EBITDA of 65 crore, the current EBITDA, if we adjust this inventory
20:17 then EBITDA would have been almost 75 to 78 crore.
20:20 Now, the next few quarters company is expecting to be soft basis
20:25 the inventory destocking in specialty chemicals and CDMO effect.
20:29 Then we have Tata Chemicals where again company posted weak set of results, profit missed estimates.
20:35 Now, this is on the back of the impact of revenues on the back of lower volume in soda, ash and pricing pressure.
20:41 Also EBITDA was impacted due to lower volume and pricing pressure across the regions.
20:45 And if you see the company has reduced its gross debt to rupees 5912 crore.
20:51 Also US volume was impacted due to plant shutdown and rail car shortage.
20:56 And the rallies which is the subsidiary company of Tata Chemicals domestically reported good numbers
21:04 but their international business seems to be challenging.
21:07 And then lastly we have responsive industries where there was flat revenue due to holiday season
21:13 and also EBITDA growth was led by market expansion product diversification.
21:17 And they have added new distributors and direct customers which should help to achieve robust sale in next 6 to 8 quarters
21:26 which will help company to achieve 30 to 35 percent of sales growth in next few years.
21:31 Alright, thanks so much Varsha for bringing us those details.
21:34 Let's stick with earnings then. We have got Avanti Feeds as well as Gulf Oil Lubricants
21:39 and Fusion Microfinance to look at closely.
21:43 We have got Harsh to tell you about the key details there.
21:45 Morning Harsh, what are you picking up?
21:47 Well, absolutely Alex. Let's look at the numbers broadly how they stack up.
21:53 Avanti Feeds the revenue was up around 14 percent on a year on year basis.
21:57 But EBITDA expanded by 20 percent year over year.
22:00 Therefore, consolidating on that margin number of 7.3 percent.
22:03 The margins have now come in at 7.7 and profit is up 18 percent year over year.
22:09 So, a healthy growth coming in there. That one will be in focus.
22:12 Of course, on the back of the budget as well we had fishery stocks which were in focus and Avanti Feeds is one of those.
22:18 Quickly moving on to Gulf Oil, you had revenue which was up just about 5 percent year over year.
22:23 But EBITDA which expanded by 23 percent leading to a very solid increase in margins.
22:29 200 bps of margin increase from that 11.5 to 13.5.
22:32 And therefore, your profit was up by 27 percent year over year.
22:36 That's coming at just below 80 crore versus the 62 crore number same time last year.
22:42 Fusion Micro, tough environment with regard to rates but margins have continued to expand for this one.
22:49 And therefore, that's one big positive coming through for Fusion Micro.
22:53 Stock has done nothing over the last year but you are seeing profit which is up 23 percent year over year.
22:58 The profit number has come in at 126.5 crore versus the 102.5 crore number same time last year.
23:05 With margin expansion largely is what is aiding the profit.
23:09 Those are the three key ones. Have a watch on those in trade today.
23:15 Thanks so much Harsh for getting us those details.
23:17 Of course, looking forward and talking about earnings that are just around the corner,
23:21 the ones that are expected today or rather the one major that is expected today is Britannia.
23:25 It's going to post its results for the third quarter.
23:29 According to Bloomberg estimates, the company will see another soft quarter.
23:32 I think that's more or less been a trend across FMCG companies this time around.
23:37 Sesar is joining in with more details. Sesar, what are the key numbers to focus on here?
23:42 Like you said, it's going to be another quarter of soft top line growth as the company laps a high base
23:50 given that the pricing continues to anniversarize.
23:54 Now, on a year on year basis, Britannia's revenue is expected to grow 2.4 percent at 4,296 crore,
24:05 according to Bloomberg estimates, and net profit is seen down 41 percent.
24:11 Now, it is important to note here that the steep decline in net profit is due to a one time gain in the base quarter.
24:19 If we look at the Q3 FY23 numbers, Britannia gained around 356 crore from the JV agreement
24:30 with Francis Belsa Group for the cheese business.
24:33 Now, as far as the operating performance is concerned, EBITDA is expected to be flat,
24:39 while margin is seen to contract at 18.9 percent versus 19.5 percent a year ago.
24:47 Higher advertising spend is expected to dent the EBITDA margin.
24:52 However, since there is no major risk on the commodity front, gross margin is expected to improve.
25:00 Now, the company has also taken price cuts through a gramage reduction in some categories,
25:06 and that is expected to drive volumes in the rural markets.
25:09 However, competition from regional players remains high, and that would keep volumes under check.
25:18 Volumes are estimated to grow at about 1 to 3 percent in Q3.
25:24 Now, the key management commentary to watch out for would be demand outlook,
25:28 update on the core business segment, and also the progress on the cheese portfolio,
25:33 and the material price trajectory for the pricing actions as well as competitive intensity.
25:39 Alright. Thanks so much, Shesha, for bringing us those details.
25:43 That brings us to the end of this particular edition of All You Need to Know.
25:46 Thanks so much for watching. Do stay tuned. Up next is India Market Open.
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