Morning Updates
IIP growth rebounds to 7.1% in Nov; retail inflation eases to 5.7% in Dec
India’s factory output rebounded to a five-month high in November and retail inflation eased marginally to a 12-month low in December, providing the much-needed comfort to the government. These will be the final set of key macro indicators available to Finance Minister Nirmala Sitharaman as she prepares to present Budget 2023-24 on February 1. Data released by the National Statistical Office showed Consumer Price Index-based inflation rate, at 5.72 per cent, remained below the Reserve Bank of India’s (RBI’s) upper tolerance limit of 6 per cent for a second consecutive month in December due to continued moderation in food prices. Meanwhile, factory output, measured through the Index of Industrial Production (IIP), grew at a robust 7.1 per cent in November, mostly due to a favourable base effect.
Targeting to double coal inventory with power plants by March: Coal secy
Days after the Union power ministry directed all power generating companies (gencos) to import coal up to 6 per cent of their requirement, the coal ministry on Thursday said the decision was just an “act of caution” and that domestic coal capacity would be ramped up. Coal Secretary Amrit Lal Meena said all the coal companies of national miner Coal India (CIL) had more coal than their targeted production for the upcoming summer season. “There is enough coal stock both with coal companies and power plants. However, power demand has grown significantly. It is a challenge; hence, the coal import decision was taken. But during the last season, CIL supplied more than their projected supply,” Meena said. According to the coal ministry’s projections, the inventory with companies should touch 65 million tonne (MT) by March from 34 MT currently. With the power plants, the ministry is expecting an inventory of 45 MT by March as against 30 MT currently.
Auto sector must enhance safety features to reduce road accidents: Gadkari
India can become the number one automotive manufacturing hub in the world within five years, but auto companies need to enhance safety features to reduce deaths due to road accidents, Union Minister Nitin Gadkari said on Thursday. In his inaugural address at the Auto Expo 2023 here, the minister for road transport and highways asserted that the government’s target is to reduce these accidents by 50 per cent before the end of 2024 while asking the auto industry to take suo moto action for road safety as the government doesn’t want to make anything mandatory. Gadkari’s sentiments were also echoed by Minister of Heavy Industries Mahendra Nath Pandey, who lamented that while India has only 1 per cent of the total overall vehicles, the country accounts for 11 per cent of the total global deaths due to road accidents.
Commodity play
Gold – Rs 55835/10gm, Silver – Rs 67687/kg, Brcrude – Rs 6314/barrel, Degumsyoil – Rs 1296/10kg, Copper – Rs 765/kg.
Corporate News
Q3 results: Infosys beats estimates, raises FY23 revenue guidance.
Torrent group bid not compliant, Reliance Capital lenders tell NCLT.
NCLT gives approval for merger of multiplex operators PVR and Inox.
Tata Group planning to set up EV cell-manufacturing operations in Europe.
SGX Nifty indicates positive start to Indian markets trading at 17948 levels up by 30 points or 0.17%. Dow Jones also ended yesterday`s session in green up by 0.64% at close.
Sector in focus – Banks, Telecommunications, Chemicals & Power.
Stock in Action
MTAR Technologies: MTAR Technologies is expected to record a revenue growth of over 50% annually in next 2 years, led by the strong growth in the short-cycle green energy projects. The growth will be backed by a strong growth in short-cycle orders. Its biggest customer, Bloom Energy, is growing rapidly and MTAR has been able to grab a larger share. MTAR’s clean energy orders more than doubled to Rs 870 crore in 2QFY23 as against Rs 406 crore in 1QFY23. Its total order book grew from Rs 957 crore by the end of March 2022 to Rs 1,288 crore by the end of September 2022, thanks to its execution capabilities. The company is also investing in newer businesses and technologies, particularly in the light of the import restrictions on certain defence equipment. Recently, the company recently received board approval and started setting up a full-fledged electronics manufacturing facility. It had earlier acquired MSME Gee Pee, which is into aerospace and defence. The acquisition is expected to provide ready access to manufacturing infrastructure and human resources, particularly for the defence business. Positive on MTAR Technologies given the earnings visibility, higher execution skill, strong order book and capacity expansion.
TCS: TCS reported good 3QFY23 growth in reasonably weak quarter. Company reported revenue growth of 19% YoY in rupee terms and 13.5% YoY in CC basis at Rs 58,229 crore. In dollar terms, company reported revenue of USD 7.05 billion grew by 8.4% YoY. The margin had a 70-basis point positive impact of forex and 30 bps positive improvement due to execution efficiency. But these were offset by higher third party costs and the impact of the return to normalcy. Operating margin improved by 50 bps on QoQ basis. Net margin improved on the back of favourable foreign exchange fluctuations. The improved productivity was achieved by focusing on utilizing the excess capacity built up over prior quarters and through investments in organic talent development. Growth during the quarter led by Retail and CPG by 18.7% and Life Sciences & Healthcare verticals (+14.4%). Communications & Media grew +13.5% and Technology & Services grew by +13.6%. Company witnessed strong bookings in this quarter led by several large deals reflecting the robust demand for its business services. The total TCV is at USD 7.8 billion with BFSI has TCV of USD 2.5 billion and Retail has USD 1.25 billion. Company has invested significantly in building capacity in 2021. Company has hired significantly ahead of revenue growth in 2021, hence will follow prudent hiring strategy going ahead. Company will hire in between 120,000-150,000. Positive on TCS as the company reasonably good growth in weak quarter and is well placed to counter any macro slowdown.
Corporate Action & Forthcoming Events
Abirami Financial Services has approved a proposal for the buyback of 6,00,000 equity shares representing 10% of the total equity shares, from the shareholders of the Company at a price of INR 28/- per equity share for an aggregate consideration not exceeding INR 1.68 Crore through ‘Tender Offer’ route.
Dividend
16-Jan-23
TCS: Interim Dividend – Rs. – 75.00
Buyback
Softsol India: Ex-Date: 13-Jan-23
Bonus
KPI Green Energy: Bonus Issue 1:1; Ex-Date: 18-Jan-23
Stock Split
Vishnu Chemicals: Stock Split From Rs. 10/- to Rs. 2/-; Ex-Date: 13-Jan-23
Deep Diamond India: Stock Split From Rs. 10/- to Rs. 1/-; Ex-Date: 20-Jan-23
Rights Issue
Indowind Energy: Ex-Date: 13-Jan-23
Anjani Portland Cement: Open: 30-Dec-22; Close: 19-Jan-23
Pacific Industries: Open: 19-Jan-23; Close: 02-Feb-23
Indowind Energy: Open: 27-Jan-23; Close: 10-Feb-23
*Forthcoming Event*
13th January: WIPRO to consider Dividend; Goyal Aluminiums to consider Stock Split; Manomay Tex India, Heritage Foods to consider Fund Raising
16th January: ANGELONE, BANARBEADS, GOTHIPL to consider Dividend; Vinny Overseas to consider Bonus issue & Stock Split; Globe Textiles (India) to consider Fund Raising
17th January: NATIONALUM to consider Dividend
18th January: PERSISTENT to consider Dividend; Vivanta Industries to consider Stock Split
19th January: HAVELLS to consider Dividend; Iifl Wealth Management to consider Bonus & Stock Split
20th January: COFORGE, RKFORGE to consider Dividend
21st January: Apollo Micro Systems, Gujarat Toolroom to consider Stock Split
23rd January: ZENSARTECH to consider Dividend; VR Films & Studios to consider Bonus issue
27th January: Osia Hyper Retail to consider Stock Split
