Fri, 14 Jan Pre-Open
Indian share markets ended on a positive note yesterday.
Frontline indices whipsawed around the flat line as tepid economic data back home and sombre global mood hit sentiment.
At the closing bell yesterday, the BSE Sensex stood higher by 85 points (up 0.1%).
Meanwhile, the NSE Nifty closed higher by 45 points (up 0.3%).
Tata Steel and JSW Steel were among the top gainers.
Wipro and Asian Paints, on the other hand, were among the top losers.
Sectoral indices ended on a mixed note with stocks in the metal sector, engineering sector and power sector witnessing most of the buying interest.
Realty stocks, on the other hand, witnessed selling pressure.
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Shares of Adani Transmission and Sun Pharma hit their respective 52-week highs.
Gold prices for the latest contract on MCX were trading up by 0.1% at Rs 47,843 per 10 grams at the time of closing stock market hours yesterday.
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Top Stocks in Focus Today
Among the buzzing stocks today will be Adani Group Stocks.
POSCO and the Adani Group together will be investing up to US$5 bn and have agreed to explore business cooperation opportunities, including the establishment of a green, environment-friendly integrated steel mill at Mundra, Gujarat, as well as other businesses.
The non-binding MoU signed between POSCO and Adani will see further collaboration at the group business level in various industries such as renewable energy, hydrogen, and logistics in response to carbon reduction requirements.
Both the parties are examining various options to cooperate and leverage the technical, financial, and operational strengths of each company.
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The collaboration includes evaluating a joint integrated steel mill at Mundra, Gujarat, based on POSCO’s state-of-the-art technology and cutting-edge R&D capability, said Adani in its release.
POSCO and Adani intend to utilise renewable energy resources and green hydrogen, in line with both partners’ environmental, social and governance (ESG) commitments to sustainability and energy efficiency.
POSCO and Adani have also signed a MoU with the Government of Gujarat for support and cooperation from the Government for the collaboration.
Tata Motors share price will also be in focus today.
Shares of Tata Motors shed almost 2% in Thursday’s session as retail sales of Jaguar Land Rover (JLR) dropped 37.6% to 80,126 units in October-December 2021, with China sales falling 6.9% and Europe sales down 6.8% compared to the previous quarter.
‘Underlying demand for JLR products remains strong and the company has proactively managed semiconductor supplies to maximise production of higher margin products,’ Tata Motors said in an exchange filing.
The sales of luxury automobile manufacturer Jaguar Land Rover, which is owned by Tata Motors, continue to suffer because of a shortage in semi-conductor chips.
While retail sales took a hit in October-December, the company did gain some comfort from a rise in wholesales, which climbed 8% in the period under review.
The easing of semiconductor shortage is visible in JLR’s output too, reports said, adding that production increased to 72,184 units, up 41% in October-December.
The company’s order book stood at 1.5 lakh units and the company’s cash flow was positive at Rs 15.2 bn, reports said.
Mindtree’s Net Profit Up 34% in December Quarter
Mindtree net profit for the third quarter ended December rose 34% year on year (YoY) to Rs 4.4 bn, driven by growth in revenues and various operational efficiency parameters and increased utilisation.
The Bengaluru-based IT services company’s revenue for the third quarter stood at Rs 27.5 bn, up 35.9% YoY, driven by broad-based growth especially in digital transformation. Sequentially, revenues grew 6.3% indicating gradual recovery in business.
The closely-watched dollar revenue stood at US$366.4 m, up 4.7% sequentially and 33.7% on year, on the back of deals worth a total contract value (TCV) of US$358 m during the quarter – a mix of annuity and recurring deals.
Mindtree’s earnings before interest, taxes, depreciation, and amortization (EBITDA) margins expanded to 21.5% from 20.5% in the preceding quarter due to operating efficiencies and currency benefits.
Digital continues to drive Mindtree’s business, and last year it completed the acquisition of the NxT Digital Business from Larsen and Toubro for Rs 2 bn, a move that is expected to help the mid-sized IT firm capture opportunities in the internet of things (IoT) and industry 4.0 space.
The attrition rate for the December quarter rose to 21.9% from 17.7% in the preceding quarter, indicating strong demand in the industry. Mindtree added about 4,500 employees in the December quarter taking its total headcount to 31,959 employees as of 31 December 2021.
India Expects to Open LIC IPO Issue by Mid-March
Life Insurance Corporation (LIC), India’s largest insurer, is likely to file a draft prospectus as early as end of this month and begin issuing public shares by mid-March.
The listing of LIC is set to be India’s biggest ever initial public offering (IPO), with the government aiming to raise up to Rs 900 bn (US$12.2 bn) from its stake sale.
According to a report, India is pushing for a valuation of about Rs 15 tn for a state-owned insurer.
The so-called embedded value of LIC is likely to be more than Rs 4 tn and its market value could be about four times that amount.
Once the final report is in, the valuation the government is seeking could change, the report added.
The final valuation would be decided based on various parameters, including investor appetite, profitability outlook, and trends in the industry.
At the valuation the government wants, a 5% stake will fetch about Rs 750 bn.
How this pans out remains to be seen. Meanwhile, stay tuned for more updates from this space.
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