Month: February 2021

Best SEBI registered Intraday tips provider and Best SEBI registered stock advisory company

Call: +91 9624421555 / +91 9624461555

Kishore Biyani’s Future Group stocks hit the upper circuit, FRL, FEL jump 10% on Delhi HC’s nod to Future-RIL deal

Future Group share prices hit the upper circuit on Tuesday after the Delhi High Court allowed the Kishore Biyani company to go-head with Reliance Industries Ltd (RIL) deal. On Monday, Delhi HC’s division bench stayed the single judge’s order passed which had directed Future Group to maintain status quo till further orders with regard to its Rs 24,713-crore deal with Reliance Retail. Future Retail Ltd shares hit 10 per cent upper circuit at Rs 80.50, Future Enterprises Ltd at Rs 11.78 apiece, Future Market Networks Ltd at Rs 19.15 apiece, Future Lifestyle Fashions Ltd at Rs 91.35 apiece, and Future Supply Chain Solutions Ltd at Rs 99.05. Similarly, Future Consumer Ltd shares were locked into 10 per cent upper circuit at Rs 8.67 apiece.

The legal battle involving Amazon, Future group & Reliance continues to influence the stock prices of the above mentioned companies leading to uncertainty and high volatility, says AR Ramachandran, Co-founder & Trainer, Tips2Trade. He advises investors to use every uptrend to exit Future group stocks as this legal battle could stretch out for a very long time. Ramachandran told Financial Express Online that currently, Rs 83-90 remains a strong resistance zone for Future Retail Ltd.

Reliance Industries Ltd (RIL) share price gained as much as 2 per cent to Rs 1,990 apiece on BSE. So far in the trade, 3.43 lakh have been traded on BSE, while 50.80 lakh shares have exchanged hands on the National Stock Exchange (NSE). Following this order from Delhi HC, now Future group can go ahead with the formalities related to the completion of the transaction. So far, the Competition Commission (CCI) and the Securities and Exchange Board of India (Sebi) have given their approval for the FRL-RIL deal. This deal now requires the approval of the National Company Law Tribunal (NCLT), which got stalled by the single judge’s February 2, 2021 order.

In the noon deals, BSE Sensex was trading 364 points or 0.71 per cent higher at 51,713, while the broader Nifty 50 index surged 110 points or 0.72 per cent to 15,225 levels.

Eqwires Research Analyst

Best SEBI registered Intraday tips provider and Best SEBI registered stock advisory company

Call: +91 9624421555 / +91 9624461555

Mahindra & Mahindra shares hit 10% upper circuit as investors react to positive Q3 results

Mahindra & Mahindra’s (M&M) share price soared 10% to hit the upper circuit on Monday morning. The up-move in the stock came just days after the company reported its fiscal third-quarter earnings where the company reported a 40% on-year jump in net profit. Revenue of the firm stood at Rs 14,057 crore, up 16% from the same period last year. Domestic brokerage firms see positives in the company’s results with many increase their target price for the stock by as much as 20%. Shares of the company were currently trading at Rs 924 per share.

Positives up ahead

Analysts at Motilal Oswal said that M&M’s third-quarter performance was driven by good performance in both, Tractors as well as Autos businesses. “Furthermore, it has guided for an almost 90% reduction in international subsidiary losses in FY22E, driven by the completion of phase-1 of the capital allocation exercise,” they added. The brokerage said that M&M is the best rural proxy. “MM has one of the highest exposures to the rural markets (~65% of volumes), which would likely be less impacted by the on-going COVID-19 disruption. According to our estimates, rural markets should contribute over 60% to revenues, ~80% to core PAT, and ~70% to SOTP in FY22E,” they added.

So far in February, the stock price has jumped a massive 22%. Domestic brokerage and research firm Prabhudas Lilladher said that M&M has a sharp focus and execution on capital allocation to help prioritise investments and returns. Further, the company’s focus beyond tractors is also being noted as a positive. The move has so far resulted in farm machinery revenues growth of 48% on-year in the current fiscal, according to Prabhudas Lilladher. The report highlighted that M&M has the lowest system stock since the first quarter of fiscal 2018 both in tractors and Auto segment.

Management’s words

M&M’s management y expects the industry to log ~20% on-year growth in the tractor segment in the current fiscal year. Current production run rate for Thar is at nearly 3,000 units per month and would be ramped up to 4,000 units per month by April-May, the management said. Cumulative bookings as of date are at over 39,000. Further, they added that the SsangYong deal is moving forward, but toward the PrePackage scheme and not the ARS scheme under the bankruptcy court.

Target price

ICICI Direct expects sales, adjusted PAT to grow at 20%, 40% CAGR, respectively, in FY21E-23E. The brokerage firm has increased its target price to Rs 1,000 per share. Prabudas Lilladher has raised target multiples of core business to 18x (from 16x) to factor in faster than expected turnaround in subs, while the target price has been increased to Rs 1,011 per share. Analysts at Motilal Oswal have a target price of Rs 1,040 per share. HDFC Securities has the most modest upgrades with an ‘Add’ rating and a target price of Rs 880 apiece.

Eqwires Research Analyst

Best SEBI registered Intraday tips provider and Best SEBI registered stock advisory company

Call: +91 9624421555 / +91 9624461555

Stove Kraft stocks debut with premium, list at 21% bonus over IPO price on bourses

The kitchen appliance manufacturer and home solutions firm, Stove Kraft made its share market debut at Rs 467 per share, a premium of Rs 82 or 21.30% from the issue price on BSE. Stove Kraft became the fourth IPO of the calendar year 2021 to list on exchanges. On National Stock Exchange (NSE), the stock listed at Rs 498 per share, rising 29.35 per cent from the issue price. On listing, the kitchen appliance manufacturer was commanding a market capitalization of Rs 1,500.31 crore. The Rs 412-crore initial public offer (IPO) was subscribed 18 times with non-institutional investors bidding 32.72 times the allocated quota of shares. In the previous session, Stove Kraft shares were seen quoting a premium of Rs 35-40 apiece, over the issue price.

Issue was opened last week, where investors were offered the shares in a bid lot of 38 equity shares or multiples, priced at Rs 384-385 per share. The initial public offer (IPO), comprised a fresh issue of up to Rs 95 crore and an offer for sale of up to 82.50 lakh equity shares. Stove Kraft caters in the sub-premium and premium segment through its brands such as Pigeon, Gilma, and BLACK + DECKER. The qualified institutional buyers (QIBs) category was subscribed 8 times, non-institutional investors 32.72 times and retail individual investors 26 times.

Analysts at Angel Broking Ltd said that Stove Kraft priced its issue at 34.5x PE on a trailing basis, its peers TTK Prestige and Hawkins Cookers were currently trading at 61.0x and 47.5x respectively. Cost such as travelling, advertisement reduced in H1FY21 due to Covid-19 is going to come back once business comes back to normalcy. Those at KRChoksey Research said that at the upper band of the issue price, Stove Kraft will trade at a Price/EPS multiple of 12.0x of its annualized H1FY21 revenue, which is at a discount to its listed peers like TTK Prestige Ltd (45x), Hawkins Cookers (42.3x), and Butterfly Gandhimathi (284.3x). “We believe that the current price band is undervalued, looking at the growth potential in the company we anticipate listing gains,” they added.

Eqwires Research Analyst

Best SEBI registered Intraday tips provider and Best SEBI registered stock advisory company

Call: +91 9624421555 / +91 9624461555

Future group stocks hit lower circuit after Sebi bans Kishore Biyani and other promoters from capital markets

Most of the Future group shares have hit their respective lower circuits on Thursday, after the capital market regulator Sebi banned Kishore Biyani, along with certain other promoters of Future Retail Ltd from the capital market for one year for indulging in insider trading in the shares of the company. Future Consumer Ltd shares hit 5 per cent lower circuit at Rs 7.80, Future Enterprises Ltd at Rs 11.15 apiece, Future Market Networks Ltd at Rs 19.95 apiece, Future Lifestyle Fashions Ltd at Rs 83.95 apiece, Future Retail at Rs 74.20 apiece and Future Supply Chain Solutions Ltd at Rs 95.15 apiece.

AR Ramachandran, Co-founder & Trainer, Tips2Trade, told Financial Express Online that the current development of Sebi announcing a one year ban on Kishore Biyani in securities market along with the legal tangle they find themselves in with Amazon has led to a breakdown in the faith of investors leading to a sharp sell-off in the Future group stocks. “Investors are best advised to look for every opportunity to exit these stocks and invest in better and more stable retail stocks like Avenue Supermarts (DMart) and V-Mart Retail Ltd for better returns,” Ramachandran said.

Sebi has also imposed a fine of Rs 1 crore each on Kishore Biyani, Anil Biyani and Future Corporate Resources. Apart from this, they have been asked to disgorge Rs 17.78 crore for the wrongful gains made by them. In comparison, BSE Sensex was trading 117 points or 0.23 per cent up at 50,373, while the Nifty 50 index was trading 45 points or 0.30 per cent at 14,835.

Moreover, Future Corporate Resources and FCRL Employee Welfare Trust have been directed to disgorge Rs 2.75 crore for the wrongful gains made by it. Anil Biyani and Future Corporate Resources are promoters of Future Retail Ltd. The market regulator had also conducted an investigation in the shares of Future Retail Ltd to ascertain whether certain persons and entities had traded during March 10, 2017, to April 20, 2017 period on the basis of Unpublished Price Sensitive Information (UPSI) pertaining to segregation of certain business of the firm.

Eqwires Research Analyst

Best SEBI registered Intraday tips provider and Best SEBI registered stock advisory company

Call: +91 9624421555 / +91 9624461555