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*Good Morning*
Modi Revamps Cabinet to Repair Popularity Ahead of India Polls
President swore in 43 new federal ministers in New Delhi
India Ministers Prasad, Javadekar Resign: President’s Office
India Invites RFPs for Naming Advisers for RINL Divestment
India Should Compensate Farmers If Crop Prices Fall: Adviser
Tycoon Adani Seeks $1 Billion to Refinance Mumbai Airport Debt
India’s SaaS Firms May Be Worth $1 Trillion by 2030, Report
Industry group forecasts strong growth for SaaS market
India Cumulative Monsoon Rainfall 5% Below Normal as of July 7
India Power Demand Hits an All-Time High But May Fall Soon: BNEF
Global Funds Buy Net INR5.33B of India Stocks Wednesday: NSE
Domestic funds sell net 2.32b rupees of stocks
Foreign Investors Buy Net INR10.4B of Indian Equities on July 6
Foreigners Sell Net INR1.4B Indian Equity Derivatives Wednesday
Indian IT industry revenues will see double-digit growth in FY22: PTI
Farmers gear up for protest against fuel price hike Thursday: PTI
Bajaj Healthcare (BAJAJHEA): Gets license to make and sell Covid drug 2-DG
Hindustan Oil Exploration (HOE): Says HDFC sold 2.46% stake in HOE for 371.9m rupees between Sept. 2017 and July 7
Natco Pharma (NTCPH): FMC Corp. gets interim injunction against Natco for patent infringement
Rashtriya Chemicals (RCF): Says settle gas pricing dispute with GAIL for INR871.7m under AMRCD mechanism
Tata Motors (TTMT): Jaguar Not Expecting Delays in Launches Due to Chip Crisis: CFO
History Backs Buying 8% Dip in Jaguar Owner’s Stock
Ujjivan Financial Services (UJJIVAN): Aberdeen Global sells 1m shares of Ujjivan: NSE
Modi Revamps Cabinet to Repair Popularity Ahead of India Polls
President swore in 43 new federal ministers in New Delhi
India Ministers Prasad, Javadekar Resign: President’s Office
India Invites RFPs for Naming Advisers for RINL Divestment
India Should Compensate Farmers If Crop Prices Fall: Adviser
Tycoon Adani Seeks $1 Billion to Refinance Mumbai Airport Debt
India’s SaaS Firms May Be Worth $1 Trillion by 2030, Report
Industry group forecasts strong growth for SaaS market
India Cumulative Monsoon Rainfall 5% Below Normal as of July 7
India Power Demand Hits an All-Time High But May Fall Soon: BNEF
Global Funds Buy Net INR5.33B of India Stocks Wednesday: NSE
Domestic funds sell net 2.32b rupees of stocks
Foreign Investors Buy Net INR10.4B of Indian Equities on July 6
Foreigners Sell Net INR1.4B Indian Equity Derivatives Wednesday
Indian IT industry revenues will see double-digit growth in FY22: PTI
Farmers gear up for protest against fuel price hike Thursday: PTI
Bajaj Healthcare (BAJAJHEA): Gets license to make and sell Covid drug 2-DG
Hindustan Oil Exploration (HOE): Says HDFC sold 2.46% stake in HOE for 371.9m rupees between Sept. 2017 and July 7
Natco Pharma (NTCPH): FMC Corp. gets interim injunction against Natco for patent infringement
Rashtriya Chemicals (RCF): Says settle gas pricing dispute with GAIL for INR871.7m under AMRCD mechanism
Tata Motors (TTMT): Jaguar Not Expecting Delays in Launches Due to Chip Crisis: CFO
History Backs Buying 8% Dip in Jaguar Owner’s Stock
Ujjivan Financial Services (UJJIVAN): Aberdeen Global sells 1m shares of Ujjivan: NSE
*SGX Nifty -40 pts (15858) from last trade 15898 ,*
Nikkei -149 pts ,
Hangseng -79 pts ,
Now @7.00am .
Dow +104.42 pts ,Nsdq +1.42 pts, S&P
+14.59 pts, Bovespa +1923 pts , Ftse +50 pts , Dax +181 pts , Cac +20 pts , Crude @ $71.93 brl (-0.21), Brent @ $73.25 brl (-0.18) , Gold @ 1804.60 (+2.50), Silver @ $26.20 (+0.07), Euro @ $1.179, JPY @ $110.56, INR @ 74.795
*Today's Corporate Action*
*8th Jul Ex Date*
BAJAJ-AUTO
Dividend - Rs. - 140.0000
BAJAJFINSV
Dividend - Rs. - 3.0000
BAJAJHLDNG
Dividend - Rs. - 40.0000
BAJFINANCE
Final Dividend - Rs. - 10.0000
CROMPTON
Final Dividend - Rs. - 2.5000
DCMSHRIRAM
Final Dividend - Rs. - 3.8000
FCL
Final Dividend - Rs. - 0.3000
HINDPETRO
Final Dividend - Rs. - 22.7500
INDIANB
Final Dividend - Rs. - 2.0000
JINDALSAW
Dividend - Rs. - 2.0000
JONJUA
Bonus issue 5:37
LTTS
Final Dividend - Rs. - 14.5000
MAHSCOOTER
Dividend - Rs. - 50.0000
PIONEEREMB
Dividend - Rs. - 0.2500
SHARIKA
Bonus issue 1:1
*Today's Key Results/Board Meetings*
*8-Jul-21*
INFRATRUST
General
SHYAMMETL
Audited Results;Dividend
TCS
Interim Dividend;Quarterly Results
*Stock under F&O ban on NSE*
*8-Jul-21*
1IBULHSGFIN
2NATIONALUM
3NMDC
4PNB
5SAIL
Nikkei -149 pts ,
Hangseng -79 pts ,
Now @7.00am .
Dow +104.42 pts ,Nsdq +1.42 pts, S&P
+14.59 pts, Bovespa +1923 pts , Ftse +50 pts , Dax +181 pts , Cac +20 pts , Crude @ $71.93 brl (-0.21), Brent @ $73.25 brl (-0.18) , Gold @ 1804.60 (+2.50), Silver @ $26.20 (+0.07), Euro @ $1.179, JPY @ $110.56, INR @ 74.795
*Today's Corporate Action*
*8th Jul Ex Date*
BAJAJ-AUTO
Dividend - Rs. - 140.0000
BAJAJFINSV
Dividend - Rs. - 3.0000
BAJAJHLDNG
Dividend - Rs. - 40.0000
BAJFINANCE
Final Dividend - Rs. - 10.0000
CROMPTON
Final Dividend - Rs. - 2.5000
DCMSHRIRAM
Final Dividend - Rs. - 3.8000
FCL
Final Dividend - Rs. - 0.3000
HINDPETRO
Final Dividend - Rs. - 22.7500
INDIANB
Final Dividend - Rs. - 2.0000
JINDALSAW
Dividend - Rs. - 2.0000
JONJUA
Bonus issue 5:37
LTTS
Final Dividend - Rs. - 14.5000
MAHSCOOTER
Dividend - Rs. - 50.0000
PIONEEREMB
Dividend - Rs. - 0.2500
SHARIKA
Bonus issue 1:1
*Today's Key Results/Board Meetings*
*8-Jul-21*
INFRATRUST
General
SHYAMMETL
Audited Results;Dividend
TCS
Interim Dividend;Quarterly Results
*Stock under F&O ban on NSE*
*8-Jul-21*
1IBULHSGFIN
2NATIONALUM
3NMDC
4PNB
5SAIL
Flight to bonds sends yields below key level; stocks mixed - https://www.moneycontrol.com/news/business/markets/flight-to-bonds-sends-yields-below-key-level-stocks-mixed-7143131.html
Moneycontrol
Flight To Bonds Sends Yields Below Key Level; Stocks Mixed
Investors have been nervous about riskier assets ahead of the release Wednesday of the June policy minutes, expected to show how serious members are about tapering their asset buying and how early rate hikes could begin.
BAJAJ HEALTHCARE LTD gets license from Defence Research and Development Organisation (DRDO) to manufacture Glucose” (2-DG), used and market “2-Deoxy-D- in control & treatment of Covid-19
Tata Motors Shares Fall On Chip Shortage Woes, But Most Brokerages Stay Bullish
Shares of Tata Motors Ltd. fell to the lowest in two months after the automaker’s luxury arm said it expects chip shortages to worsen in the ongoing second quarter, hurting sales. Still, that didn’t deter most analysts from staying bullish on the company.
Jaguar Land Rover on Tuesday said chip shortages in the quarter ending September are expected to be greater than in the preceding three months, resulting in wholesale volumes about 50% lower than planned during the period.
Chip shortage is very dynamic and difficult to forecast, Tata Motors said in an exchange filing. “Some level of shortages will continue through to the end of the year and beyond.” The company, however, will prioritise production of higher margin vehicles using the available chip supply, and expects the situation to start improving in the second half of the ongoing financial year.
Analysts, too, expect Tata Motors to start to turn around by the next fiscal, defying the near-term pressures.
Jefferies
Maintains ‘buy’ rating, cuts target price to Rs 435 apiece from Rs 455.
Tata Motors has provided very weak guidance for the first half of the fiscal. Cuts FY22 Ebitda and earnings per share by 10% and 44%, respectively;
FY23 earnings are broadly unchanged as semiconductor shortages will ease in time.
Despite the near-term pressure, Tata Motors is poised to deliver a strong turnaround by FY23, led by cyclical recovery and improved strategy at both JLR and India.
Nomura
Maintains ‘neutral’ rating with a target price of Rs 353 apiece.
“The chip shortage impact in the first half of FY22 is much higher than our expectation and has put our FY22 volume estimates of 483,000 at risk by more than 10%, especially if the impact remains significant in the second half.”
There is a risk of delayed launch of new Range Rover as well. Given negative free cash flow, the brokerage’s FY22 debt assumptions have an upside risk as well. “We will track management commentary on FY22F volume guidance.”
Impact on JLR is also worrying because it seems that the impact is much higher than what other luxury players have reported.
For instance, BMW commented that it has only lost 30,000 units due to chip shortage.
Daimler also indicated its deliveries were impacted in June 2021 and expects the impact to continue over the next two quarters.
“Currently, our global team expects chip shortage to start easing from September 2021 onwards.”
Morgan Stanley
Maintains ‘equal-weight’ stance with a target price of Rs 300, implying a potential downside of 13%.
The impact of the chip shortage at JLR is much more than anticipated. Key to monitor is that the demand environment in the second half of the fiscal remains healthy as production starts to recover then.
“Increases Ebitda estimates for JLR and moving our valuation horizon to 12 months ending June 2023, partially offset by decline in India business Ebitda and increase in share count, drive our price target to Rs 300.”
Antique Stock Broking
Maintains ‘buy’ rating with a price target of Rs 425 apiece.
Expects improvement in operating performance and financial deleveraging across Tata Motors’ all three businesses over the next three years.
Values India business at 10 times the FY23 Ebitda, given early stages of demand upcycle in commercial vehicles and structural turnaround in passenger vehicles business.
Values JLR business at 2.2 times FY23 Ebitda, in line with European premium car peers. Key risk: The impact of Covid-19 on sales and production in India and the slower-than-expected economic recovery in India in FY22.
Motilal Oswal
Maintains ‘buy’ rating with a target price of Rs 400 per share. All three of Tata Motors’ businesses are in recovery mode.
While the India commercial vehicle business would see a cyclical recovery, the India passenger vehicle business is in a structural recovery mode. JLR is also witnessing a cyclical recovery, supported by a favorable product mix.
Shares of Tata Motors Ltd. fell to the lowest in two months after the automaker’s luxury arm said it expects chip shortages to worsen in the ongoing second quarter, hurting sales. Still, that didn’t deter most analysts from staying bullish on the company.
Jaguar Land Rover on Tuesday said chip shortages in the quarter ending September are expected to be greater than in the preceding three months, resulting in wholesale volumes about 50% lower than planned during the period.
Chip shortage is very dynamic and difficult to forecast, Tata Motors said in an exchange filing. “Some level of shortages will continue through to the end of the year and beyond.” The company, however, will prioritise production of higher margin vehicles using the available chip supply, and expects the situation to start improving in the second half of the ongoing financial year.
Analysts, too, expect Tata Motors to start to turn around by the next fiscal, defying the near-term pressures.
Jefferies
Maintains ‘buy’ rating, cuts target price to Rs 435 apiece from Rs 455.
Tata Motors has provided very weak guidance for the first half of the fiscal. Cuts FY22 Ebitda and earnings per share by 10% and 44%, respectively;
FY23 earnings are broadly unchanged as semiconductor shortages will ease in time.
Despite the near-term pressure, Tata Motors is poised to deliver a strong turnaround by FY23, led by cyclical recovery and improved strategy at both JLR and India.
Nomura
Maintains ‘neutral’ rating with a target price of Rs 353 apiece.
“The chip shortage impact in the first half of FY22 is much higher than our expectation and has put our FY22 volume estimates of 483,000 at risk by more than 10%, especially if the impact remains significant in the second half.”
There is a risk of delayed launch of new Range Rover as well. Given negative free cash flow, the brokerage’s FY22 debt assumptions have an upside risk as well. “We will track management commentary on FY22F volume guidance.”
Impact on JLR is also worrying because it seems that the impact is much higher than what other luxury players have reported.
For instance, BMW commented that it has only lost 30,000 units due to chip shortage.
Daimler also indicated its deliveries were impacted in June 2021 and expects the impact to continue over the next two quarters.
“Currently, our global team expects chip shortage to start easing from September 2021 onwards.”
Morgan Stanley
Maintains ‘equal-weight’ stance with a target price of Rs 300, implying a potential downside of 13%.
The impact of the chip shortage at JLR is much more than anticipated. Key to monitor is that the demand environment in the second half of the fiscal remains healthy as production starts to recover then.
“Increases Ebitda estimates for JLR and moving our valuation horizon to 12 months ending June 2023, partially offset by decline in India business Ebitda and increase in share count, drive our price target to Rs 300.”
Antique Stock Broking
Maintains ‘buy’ rating with a price target of Rs 425 apiece.
Expects improvement in operating performance and financial deleveraging across Tata Motors’ all three businesses over the next three years.
Values India business at 10 times the FY23 Ebitda, given early stages of demand upcycle in commercial vehicles and structural turnaround in passenger vehicles business.
Values JLR business at 2.2 times FY23 Ebitda, in line with European premium car peers. Key risk: The impact of Covid-19 on sales and production in India and the slower-than-expected economic recovery in India in FY22.
Motilal Oswal
Maintains ‘buy’ rating with a target price of Rs 400 per share. All three of Tata Motors’ businesses are in recovery mode.
While the India commercial vehicle business would see a cyclical recovery, the India passenger vehicle business is in a structural recovery mode. JLR is also witnessing a cyclical recovery, supported by a favorable product mix.
India Strategy
Govt's first mega cabinet reshuffle - Out of box and effective
India announced a major expansion of its council of ministers, first since Shri Narendra Modi took charge as the Prime Minister of India in May 2019, for the second consecutive term. In fact, the mega reshuffle is biggest since BJP-led NDA came into power in 2014.
Govt now has 77 ministers, half being new. No of cabinet ministers has increased from 21 to 30. No of minsters of state has increased from 23 to 45, with just 2 minsters of date with independent charge. While one can argue that there is an attempt to balance regional aspirations keeping in mind major state elections next year, there is clear attempt to boost performance, bring new energy and make productive ministries.
What stands out -
1. Exit of four high profile ministers
2. Shri Hardeep Puri as Minister of Petroleum and Natural Gas. Puri is expected to speed up process of divestment. Should act as a key re-rating catalyst for oil PSUs.
3. Shri Piyush Goyal is now heading Textile Ministry also, apart from Commerce and Industry Ministry. This is a bold move, give that textile has potential to be the most prolific export sector for India given that India is among largest producers of cotton in the world. Textile, yarn sector and its value chain, which is witnessing significant upcycle, should further see rerating.
4. Shri Jyotiraditya Scindia will run civil aviation ministry. His performance during earlier tenures has been good, and one would expect him to take matters of civil aviation forward. Good time for civil aviation sector to get him as minister, while recovery is underway.
5. Highly unanticipated, Shri Mansukh Malviya is minister for health, and chemical and fertilisers. Haven't seen in past these two ministries run by one cabinet minister in long time, but maybe it's a good idea given that coordination between these two key ministries during acute COVID crisis was found lacking.
6. Carving out of Dept of Public Enterprise from Ministry of Heavy Industries and bringing under Ministry of Finance is significant. It will give better coordination for divestment. Very surprising but out-of-box move.
Overall, the cabinet reshuffle will infuse a lot of confidence, thus providing stability to market valuations. Sector that can see re-rating due to the cabinet expansion include oil refineries and CGD sector, textile and engineering, pharmaceutical and civil aviation.
Antique
Govt's first mega cabinet reshuffle - Out of box and effective
India announced a major expansion of its council of ministers, first since Shri Narendra Modi took charge as the Prime Minister of India in May 2019, for the second consecutive term. In fact, the mega reshuffle is biggest since BJP-led NDA came into power in 2014.
Govt now has 77 ministers, half being new. No of cabinet ministers has increased from 21 to 30. No of minsters of state has increased from 23 to 45, with just 2 minsters of date with independent charge. While one can argue that there is an attempt to balance regional aspirations keeping in mind major state elections next year, there is clear attempt to boost performance, bring new energy and make productive ministries.
What stands out -
1. Exit of four high profile ministers
2. Shri Hardeep Puri as Minister of Petroleum and Natural Gas. Puri is expected to speed up process of divestment. Should act as a key re-rating catalyst for oil PSUs.
3. Shri Piyush Goyal is now heading Textile Ministry also, apart from Commerce and Industry Ministry. This is a bold move, give that textile has potential to be the most prolific export sector for India given that India is among largest producers of cotton in the world. Textile, yarn sector and its value chain, which is witnessing significant upcycle, should further see rerating.
4. Shri Jyotiraditya Scindia will run civil aviation ministry. His performance during earlier tenures has been good, and one would expect him to take matters of civil aviation forward. Good time for civil aviation sector to get him as minister, while recovery is underway.
5. Highly unanticipated, Shri Mansukh Malviya is minister for health, and chemical and fertilisers. Haven't seen in past these two ministries run by one cabinet minister in long time, but maybe it's a good idea given that coordination between these two key ministries during acute COVID crisis was found lacking.
6. Carving out of Dept of Public Enterprise from Ministry of Heavy Industries and bringing under Ministry of Finance is significant. It will give better coordination for divestment. Very surprising but out-of-box move.
Overall, the cabinet reshuffle will infuse a lot of confidence, thus providing stability to market valuations. Sector that can see re-rating due to the cabinet expansion include oil refineries and CGD sector, textile and engineering, pharmaceutical and civil aviation.
Antique
World Markets
Dow + 104
Nasdaq + 1
Dax + 181
Nikkei - 139
Hangseng - 36
Sgxnifty - 33 (15865)
Brent Crude 73.28
Dow Fut - 42
Dollar Index 92.75
Dow + 104
Nasdaq + 1
Dax + 181
Nikkei - 139
Hangseng - 36
Sgxnifty - 33 (15865)
Brent Crude 73.28
Dow Fut - 42
Dollar Index 92.75