Experts say the market is likely to remain volatile this week and they suggest keeping a watch on the US for triggers and oil prices along with economic data points on the domestic front.
The Indian market made a smart comeback in the week gone by, with benchmark indices rising over 2 percent. However, weakness in the last two sessions cut profits and pushed the Nifty back below the psychologically important 15,000-mark. Improving macro numbers and a strong showing from autos in February lifted the sentiment, while rising bond yields and weak global cues kept the bulls in check. The BSE Sensex added 1,305.33 points, or 2.6 percent, to end the week at 50,405.32 and the Nifty50 rose 408.95 points, or 2.8 percent, to finish at 14,938.1. Experts expect volatility to continue in the coming week. Investors, they say, should keep a close eye on the US for triggers and oil prices along with economic data points on the domestic front. The market is on March 8 expected to react to the US Senate passing President Joe Biden’s much-awaited $ 1.9 trillion coronavirus relief package on March 6. It is one of the largest stimulus bills in the US history, a Reuters report said.
Tata Communications | The share price gained over 15 percent during the week. CLSA has maintained a buy call on the stock and raised the target to Rs 1,475 from Rs 1,365 a share earlier. The firm is of the view that growth services are expanding 2x of traditional and forms a 24 percent share. CLSA has revised the target which includes 33 percent of 756 acres of surplus land value, according to a CNBC-TV18 report. “Tata Communications has been deleveraging and net debt has reduced to Rs 8,000 crore with gearing comfortable at 1.9x EDITDA,” the research firm said. Tata Communications has partnered with Google Cloud to “drive cloud adoption” in India, the company announced on February 16. The partnership, Tata Communications claimed, has further expanded their managed public cloud services portfolio to include capabilities for Google Cloud.
Tata Power | The scrip was up over 12 percent after the company signed a power purchase agreement with Tata Steel. Tata Power announced that TP Saurya Limited, the wholly-owned subsidiary of Tata Power Company Limited, signed an agreement with Tata Steel to develop a 15 MW solar project in Jamshedpur, Jharkhand. Tata Power Delhi Distribution and Australian tech firm Power Ledger announced the launch of the first live peer-to-peer solar energy trading project in Delhi. Tata Power DDL and Power Ledger, in collaboration with India Smart Grid Forum (ISGF), have rolled out live peer-to-peer (P2P) solar energy trading, a first-of-its-kind pilot project in the national capital, a statement said.
Adani Ports | The stock price was up 11 percent after the company announced the acquisition of a 31.5 percent stake in Gangavaram Port. In an exchange filing, Adani Ports & SEZ said it was acquiring the 31.5 percent stake held by Windy Lakeside Investment Ltd (an affiliate of Warburg Pincus) in Gangavaram Port Ltd (GPL) for Rs 1,954 crore. In FY20, GPL had a cargo volume of 34.5 MMT, generated revenue of Rs 1,082 crore, EBITDA of Rs 634 crore (margin of 59 percent) and PAT of Rs 516 crore. GPL is debt-free with a cash balance of over Rs 500 crore, it added. GPL is the second-largest non-major port in Andhra Pradesh with a 64 MMT capacity established under a concession from the government that extends till 2059. It is an all-weather, deep-water, multi-purpose port capable of handling fully laden super-cape size vessels of up to 200,000 DWT.
BEML | The stock price gained 8 percent during the week. The company said that it appointed Deloitte Haskins & Sells, as a consultant for advising, undertaking and implementing demerger of the non-core assets of the company.
Vodafone Idea | The stock was down over 6 percent amid reports that the debt-laden telco’s fund-raising plans were in trouble. Vi’s talks with the Oak Hill consortium had not led to a binding agreement as there were unresolved issues around funding terms, guarantees and claims to the struggling telco’s assets in case of a payment default, a report by The Economic Times said. The report added while talks between the two sides had not fallen through, the telecom JV between the UK’s Vodafone Group and Aditya Birla Group was already exploring other potential funding partners and was confident of securing funds by the end of March, the report said.
Bank of Baroda | The stock price shed 5 percent during the week. CLSA upgraded Bank of Baroda to buy from outperform and raised target price to Rs 125 from Rs 80 on benign corporate credit cycle ahead. CLSA said Bank of Baroda’s CET-1 ratio would improve to 10 percent with the recent capital raise. “With an improvement in core profitability and moderate growth expectations, we expect BOB CET-1 to organically accrete over FY22-23, which could reduce the risk of dilutive capital raise,” CLSA added.
Jet Airways | The share price was down 13 percent. The winning bidder for the now-grounded Jet Airways would have to apply for slots as there cannot be any deemed approval for the slots, according to submissions by the civil aviation ministry and regulator DGCA. The Ministry of Civil Aviation and DGCA mentioned their stance to the National Company Law Tribunal (NCLT), which had on February 25 sought their responses to Jet Airways’ slots issue. NCLT is considering the resolution plan submitted by Kalrock-Jalan Consortium for the airline. The plan has already been approved by the Committee of Creditors.
Balrampur Chini | The scrip gained over 13 percent in the week gone by. Pramod Patwari, CFO of Balrampur Chini Mills, told CNBC-TV18 in an interview that despite the challenges, India should be able to export five-six million tonne of sugar this year. “It is correct that there are some challenges in respect to container availability but what we have seen in the last year also, in the midst of COVID also, the industry was in a position to export entire quota of six million tonne.” He said currently they were selling at Rs 32 ex-mill in Uttar Pradesh (UP). However, he expects domestic sugar prices to go up in the next 10-15 days. “We expect sugar prices in the domestic front to go up. The summer is setting in and once the mills start closing down their operations in view of lower cane availability, we are of the view that in next 10-15 days sugar prices should improve,” he said. Patwari said that Balrampur Chini achieved 98 percent of ethanol supply this year and a new ethanol plant would be commissioned by November 2022.
Adani Gas | The stock price jumped over 36 percent last week. Ruchit Jain, Senior Analyst – Technical and Derivatives at Angel Broking, is of the view that the stock gave a breakout from its consolidation phase in mid-February and since then, it has seen a sharp surge with good volumes. The overall trend is positive and since the prices are in uncharted territory, it would be prudent to ride this trend with a trailing stop loss method. The short-term moving average points to support at Rs 600 and thus, one can hold the stock with a stop placed below the support and ride the trend. Adani Total Gas Limited has raised compressed natural gas (CNG) and domestic piped natural gas (PNG) prices across regions.
Sandip Das
