Stocks in Focus on October 28: IndusInd Bank, Nykaa IPO, Jubilant FoodWorks, KIMS Hospitals to Vedanta and more
Domestic equity indices on Wednesday, October 27, 2021, witnessed modest losses amid weak global cues, however, the Sensex remained above the 61,000 mark while the Nifty remained above the 18,200 level.
Domestic equity indices on Wednesday, October 27, 2021, witnessed modest losses amid weak global cues, however, the Sensex remained above the 61,000 mark while the Nifty remained above the 18,200 level. The BSE Sensex fell 207 points, or 0.34%, to trade at 61,143. The NSE Nifty also slipped 57 points, or 0.31%, to trade at 18,211. But certain stocks came in the news after the market was closed. These stocks can impact the indices when it reopens on Thursday, October 28, 2021. List of such five stocks:
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IndusInd Bank + SBI Life + Bajaj Auto + L&T + Titan + ITC + Adani Port + PNB
IndusInd Bank: Private sector lender IndusInd Bank has reported a 73% YoY rise in the standalone profit at Rs 1,147 crore for the quarter ended September 30, 2021. It had posted a profit of Rs 663 crore in the year-ago quarter. Net interest income - the difference between interest earned and interest expended - rose by 12% YoY to Rs 3,658 crore from Rs 3,278 crore posted in the year-ago quarter. Net interest margin fell to 4.07% in Q2FY22 mainly due to surplus liquidity placed under repo with RBI. Provisions and contingencies during the reported quarter stood at Rs 1,703 crore down by 13.28% YoY as against Rs 1,964 crore and 8% QoQ from Rs 1,844 crore. The lender's loan book grew by 10%. The gross non-performing assets (GNPA) stood at 2.77% in Q2FY22 as against 2.88% posted in Q1FY22, while the net NPAs declined to 0.8% in the period under consideration as against 0.84% posted in the previous quarter ended June 30, 2021. Slippages stood at Rs 2,658 crore as against Rs 2,762 crore. Upgrades are at Rs 1,077 crore as against Rs 845 crore and recoveries stand at Rs 601 crore as against Rs 589 crore.
SBI Life: The life insurance company has reported an 18% YoY decline in profit at Rs 246 crore for the quarter ended September 30, 2021. It had posted a profit of Rs 300 crore in the year-ago quarter. Net premium income increased 14% YoY to Rs 14,660 crore as against Rs 12,857 crore posted last year. The solvency ratio was at 2.12% against 2.45%. Value of new business on an effective tax rate basis grew 77% to Rs 14.2 billion. . VNB margin expanded by 510 bps to 25.3%. Assets under Management (AuM) grew by 31% to Rs 2.4 trillion. Market share increased to 23.6% in H1FY22 as against 20.1% posted in H1FY21.
Bajaj Auto: The manufacturer of motorcycles and three-wheelers Bajaj Auto has reported a 12% YoY rise in the standalone profit at Rs 1,275 crore for the quarter ended September 30, 2021. It had posted a profit of Rs 1,138 crore in the year-ago quarter. Its revenue from operations grew 22.4% YoY to Rs 8,762 crore as against Rs 7,156 crore posted last year. EBITDA improved to 10.7% to Rs 1,401 crore as against Rs 1,266 crore posted last year. However, the margin contracted to 16% in Q2FY22 as against 17.7% posted in Q2FY21. The company has reported an exceptional item of Rs 501 crore.
- Netherland subsidiary held a 47.99% stake in KTM AG
- Subsidiary swapped 46.5% stake in KTM AG for 49.9% stake in Pierer Bajaj AG
- Resultant gain in fair value of Rs 501 crore shown as an exceptional item
- The board has approved the incorporation of a captive finance subsidiary (NBFC) of the company to undertake the business of solely financing the customers of the products manufactured/marketed by the company and its subsidiaries/associates. The new company is expected to strengthen the financing options for its customers, as financing is key to the automobile business.
L&T: Engineering and Construction major Larsen & Turbo (L&T) has reported a 51.4% YoY rise in the consolidated profit at Rs 2,135 crore for the quarter ended September 30, 2021. It had posted a profit of Rs 1,410 crore in the year-ago quarter. Adjusted profit fell by 67% YoY to Rs 18,19.5 crore as against Rs 5,520 crore posted last year. Its revenue from operations grew 12% YoY to Rs 34,773 crore as against Rs 31,034 crore posted last year. Its EBITDA grew by 20% YoY to Rs 3,995 crore as against Rs 3,335 crore posted last year. Margins grew to 11.5% in Q2FY22 as against Rs 10.7% posted in Q2FY21. New orders grew by 50% YoY to Rs 42,140 crore. The company's total order book stands at Rs 3.3 lakh crore.
New Orders Break-up (YoY)
Segment New Orders Change
Infra Rs 12108 crore -16.6%
Heavy Engg Rs 648 crore +100%
Defence Rs 441 crore -67%
Power Rs 143 crore +83%
Hydrocarbon Rs 14,503 crore +146.5x
Revenue Break-up (YoY)
Segment Revenue Change
Infra Rs 13,923 crore +7.4%
Heavy Engg Rs 624 crore +7.8%
Hydrocarbon Rs 4867 crore +20.4%
Defence Rs 845 crore +10.5%
Power Rs 1114 crore +62%
- Overall business environment looks more positive
- Festive season should further boost demand-led economic recovery across segments
- Recent measures will lead to infra development
- Company continues to focus on profitable execution
Titan: The Tata Group company has reported a 222% YoY rise in the standalone profit at Rs 641 crore for the quarter ended September 30, 2021. It had posted a profit of Rs 199 crore in the year-ago quarter. Its revenue from operations rose 66% to Rs 7,170 crore as against Rs 4,318 crore posted last year. EBITDA grew 225% to Rs 954 crore in the period under consideration as against Rs 294 crore posted last year. Its margins improved to 13.3% in Q2FY22 as against 6.8% posted in Q2FY21.
- Revenues Up 64.1% to Rs 6298 v/s Rs 3837 cr
- EBIT Up 178.2% to Rs 793 v/s Rs 285 cr
- Margins 12.6% v/s 7.4%
Watches and Wearables
- Revenues Up 71.75% to Rs 687 v/s Rs 400 cr
- EBIT Profit of Rs 92 v/s loss of Rs 4 cr
- Margins at 13.4%
- Revenues Up 70.2% to Rs 160 v/s Rs 94 cr
- EBIT Up 311% to 37 v/s 9 cr
- Margins 23.1% v/s 9.6%
ITC: Cigarette to hotels giant ITC Ltd has reported a 13.7% YoY rise in the standalone profit at Rs 3,697.2 crore for the quarter ended September 30, 2021. It had posted a profit of Rs 3,252.6 crore in the year-ago quarter. Its revenue from operations rose 12.6% to Rs 12,731 crore as against Rs 11,310 crore posted last year. EBITDA grew 12.9% to Rs 4,615 crore in the period under consideration as against Rs 4,088.2 crore posted last year. Its margins improved to 36.25% in Q2FY22 as against 36.2% posted in Q2FY21.
- Revenues Up 10.2% to Rs 5641.7 v/s Rs 5121.3 cr
- EBIT Up 10.4% to Rs 3583.1v/s Rs 3244.8 cr
- Margins 63.5% v/s 63.4%
- Revenues Up 2.9% to Rs 4046.4 v/s Rs 3922.4 cr
- EBIT down 2.7% to Rs 271.9 v/s Rs 279.4 cr
- Margins down to 6.7% v/s 7.1%
- Revenues Up 259.6% to Rs 294.7 v/s 82 cr
- EBIT Loss of Rs 48 cr v/s loss of Rs 185 cr
- Revenues Down 7% to Rs 2776 v/s Rs 2985.3 cr
- EBIT Up 14.9% to Rs 294.1 v/s 256.1 cr
- Margins 10.6% v/s 8.6%
- Revenues Up 25.4% to Rs 1829.7 v/s Rs 1458.7 cr
- EBIT Up 23.85% to Rs 409 v/s Rs 330.3 cr
- Margins 22.35% v/s 22.64%
Adani Port: India's largest private multi-port operator Adani Ports and Special Economic Zone Limited has reported a 31.4% YoY decline in the consolidated profit at Rs 951.7 crore for the quarter ended September 30, 2021. It had posted a profit of Rs 1,387 crore in the year-ago quarter. Exceptional item of Rs 405 crore hits profit. Its revenue from operations rose 21.7% to Rs 3,532.4 crore as against Rs 2,902.5 crore posted last year. Adjusted EBITDA grew 19.3% to Rs 2,207 crore in the period under consideration as against Rs 1,850.5 crore posted last year. Its adjusted margins fell to 62.5% in Q2FY22 as against 63.8% posted in Q2FY21.
- FY22 Cargo volume guidance revised to 350-360 MMT, a growth of 45%
- CapEx to be around 3,100–3,500 cr
- Company to exit Myanmar investment by Q1FY23
Torrent Power: The energy and power company has reported an 83% YoY rise in the consolidated profit at Rs 367 crore for the quarter ended September 30, 2021. It had posted a profit of Rs 201 crore in the year-ago quarter. Its revenue from operations rose 16.6% to Rs 3,648 crore as against Rs 3,129 crore posted last year. EBITDA grew 32% to Rs 938 crore in the period under consideration as against Rs 711 crore posted last year. Margins improved to 25.7% in Q2FY22 as against 22.7% posted in Q2FY21.
- Reduction in T&D losses boosts performance
- Increase in electricity demand drives revenue
- Lower costs, reduction in provisions aid bottom line
Punjab National Bank: The public sector lender has reported a 78% YoY rise in the standalone profit at Rs 1,105 crore for the quarter ended September 30, 2021. It had posted a profit of Rs 621 crore in the year-ago quarter. Net Interest Income (NII) declined 25% to Rs 6,353 crore in the period under consideration as against Rs 8,455 crore posted last year. Provisions for bad loans dropped 30% YoY and 17% QoQ to Rs 2,692 crore as against Rs 3,811 crore in Q2FY21 and Rs 3,248 crore in Q1FY22. Gross non-performing assets (GNPA) dropped to 13.63% QoQ in Q2FY22 as against 14.3% in Q1FY22. The net NPA also dropped to 5.49% QoQ as against 5.84% posted in Q1FY22. The lender's equity stake of 12% will be reduced to 9% by December.
Nykaa IPO: FSN E-Commerce Ventures Ltd, the parent company of the online beauty e-commerce platform Nykaa, will launch its initial public offering (IPO) today, i.e., Thursday, October 28, 2021. The issue will close on Monday, November 1, 2021. The company has fixed a price band of Rs 1,085-1,125 per share as the company seeks to raise more than Rs 5,351.9 crore through the public offering. The IPO comprises a fresh issue of equity shares aggregating up to Rs 630 crore and an offer for sale (OFS) of up to 41,972,660 equity shares being offered by the selling shareholders. Bids can be made for a minimum of 12 equity shares and in multiples of 12 equity shares thereafter, a maximum of up to Rs 2 lakhs. The company is offering a discount of Rs 100 per Equity Share to Eligible Employee Category. Nykaa has raised Rs 2,395.8 crore through its anchor book allocation ahead of its initial public offering (IPO). The firm allocated 21,296,397 shares at the upper price band of Rs 1,125 per equity share, it said in an exchange filing. Some of the anchor investors include Aditya Birla Sun Life (3.1%), SBI Fund (3.1%), HDFC Fund (3.1%), Nippon Life (3.1%), Blackrock (2.3%), Fidelity Investment (6.3%), Government of Singapore, Canada pension plan, JP Morgan, Nomura, Abu Dhabi Investment, Goldman Sachs, among others.
Paytm IPO: One97 Communications, the parent company of Fintech firm Paytm, is looking to launch its initial public offering (IPO) on November 8, 2021, at a price band of Rs 2,080-2,150 per share. The issue will close on November 10, 2021. The IPO size is Rs 18,300 crore.
Jubilant FoodWorks + Zomato
Jubilant Foodworks Ltd: The food service company has entered into a share purchase agreement with Hashtag Loyalty Pvt. Ltd to acquire a 35% stake in the online food ordering platform for around Rs 25 crore. Hashtag Loyalty provided an online ordering platform, it is an enterprise tech in the food sector. HLPL is engaged in the business of providing a platform that allows brands their own online ordering systems to accept direct orders from customers and provides an enterprise-grade omnichannel customer engagement & marketing automation platform. It clocked revenues of Rs 1.13 crore in FY20.
Zomato: Zomato Ireland, a wholly-owned subsidiary of the company located in Lebanon, will shut down operations from December 15, 2021. It has a 2.4% contribution to the overall turnover of the company. Operations of Lebanon will be closed because the country has been going through an economic crisis with a depreciating currency for the last 2 years. The situation has become worse over the past few months and as a result, the business viability and future outlook for the region have deteriorated significantly. This closure is also in line with our broader strategy of focusing on our core India market.
Krishna Institute of Medical Sciences Limited: KIMS Hospitals has entered into definitive agreements to acquire a 51.07% stake in Sunshine Hospitals (M/s Sarvejana Healthcare private Limited) at an enterprise value of Rs 730 crore. The acquisition is a combination of an 18.52% stake (worth Rs 363 crore) through equity shares and the remainder through partly paid-up equity shares (worth Rs 133 crore), which shall be fully paid up by April 2022 based on an agreed schedule. The combined entity will have l2 hospitals across 9 cities with 3666 beds
Vedanta: Monte Cello BV (“MCBV”), a 100% subsidiary of Vedanta Limited, has entered into a Term sheet agreement to divest Copper Mines of Tasmania (“CMT”) by way of an Option Agreement with New Century Resources. MCBV is 100% owner of the Mt Lyell Copper Mine in Australia, a small copper asset that has been on care and maintenance for the last 5 years and not strategic for Vedanta with its size and country presence. The terms of the Option Agreement include a minimum expenditure commitment of US$10 million over the two-year option period by New Century towards development and exploration, plus reimbursement of ongoing care and maintenance activities, with an option of right to terminate after 12 months. The transaction is subject to full-form documentation, which is expected to be signed by the end of October 2021.
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