Morning Update for 19 May 2021

Indices at previous closing

Nifty50: 15,108 ▲ +184 (+1.2%)
Sensex: 50,193 ▲ +612 (+1.2%)
Nifty Bank: 33,922 ▲ +463 (+1.3%)

In the news

Tata Motors’ Q4 hit by JLR write-down 

• The auto major’s revenue rose 42% YoY to ₹88,628 crore, beating street estimates of ₹87,517 crore. However, it posted a loss of ₹7,585 crore versus street expectations of a profit of ₹2,774 crore.
• Losses in the quarter were due to a ₹14,994 crore writedown for JLR’s cancelled models and restructuring costs related to legal obligations. The company expects Q1FY22 to be affected by high raw-material prices and semiconductor shortages. The stock was up 3.3% yesterday and has risen 13% so far this month.

Torrent Pharma’s Q4 revenues drop 

• For Q4FY21, Torrent Pharma reported revenue from operations of ₹1937 crore, down 0.4% YoY, mainly due to a 30% decline in revenues from the US market. As a result, net profit grew by a muted 3.2% YoY to ₹324 crore.
• It derives nearly 50% of revenues from the Indian market which grew 10% on the back of recovery in chronic, sub-chronic and acute therapies. The stock was down 1.5% yesterday but has gained nearly 9% so far this month.

Canara Bank’s Q4 back in black

• The state-owned bank reported a net interest income of ₹5,589 crore in Q4, up 9.8% YoY. It also reported a profit of ₹1,010 crore verus a loss of ₹6,567 crore last Q4, supported by a rise in other income and fall in provisions. 
• Crucially, the Bengaluru-based bank’s net NPAs have shrunk from last Q4’s 4.3% to 3.8% as of March 2021. The stock was down 4.2% yesterday, but is up about 6% in May.

Ujjivan SFB’s Q4 net profit soars 

• Bengaluru based small finance bank reported a 86% YoY rise in net profit to ₹136 crore. The profits rose even as the net interest income fell by 21% to ₹368 crore. 
• The profit was supported by a 57% rise in other income and writeback in provisions. Its net NPAs rose from 0.2% last year to 2.9% indicating deterioration in asset quality. Shares of Ujjivan SFB gained 1.5% yesterday and about 6% so far this month.

Events/data releases of the week

• Wednesday: Crude oil inventories (US)
• Thursday:  Initial jobless claims (US)

Sectoral indices (18 May)

Global markets (at 8:00 am)

Fact of the day

Recently, Nasdaq had to temporarily suspend broadcasting prices for shares of Berkshire Hathaway because its price rose too high. The US index's computers can accommodate a maximum stock price of $429,496.7295, while the shares of the Warren Buffet-run company hit $440,000.
Source: Wall Street Journal

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Investments in securities markets are subject to market risks; please read all the related documents carefully before investing. The securities quoted are exemplary and are not recommendatory. Past performance is not indicative of future results. Details provided in the above newsletter are for educational purposes and should not be construed as investment advice by RKSV group. Investors should consult their investment advisor before making any investment decision.