This is in continuation to the order received for stage III and IV (2x500 MW and 2x500 MW) in September last year

The share price of Larsen & Toubro added nearly 2 percent intraday on August 23 after the company won an order from NTPC.

The power business of Larsen and Toubro (L&T) has bagged engineering, procurement and construction (EPC) order from NTPC to set up flue gas desulphurisation (FGD) system at Vindhyachal super thermal power station, Stage-I to II (6x210 MW Ft 2x500 MW), in Madhya Pradesh, as per company release.

This is in continuation to the order received for stage III and IV (2x500 MW and 2x500 MW) in September last year.

With this, L&T will be implementing FGD systems for 12 units constituting 4,260 MW at NTPC's Vindhyachal power plant which will have the maximum number of FGD systems at one location in India.

Installation of FGD systems in existing and upcoming thermal power plants has been made mandatory by the Ministry of Environment, Forest and Climate Change (MoEFCC) Government of India, to curtail SO2 emissions.

Larsen & Toubro was quoting at Rs 1,287.30, up Rs 0.30, or 0.02 percent on the BSE

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The lender held 12.79 percent stake in CG Power and Industrial Solutions as of June 2019

Shares of Yes Bank fell over 5 percent intraday on August 21, hitting their fresh 52-week low of Rs 67.55, following worries over the valuation of stake in Gautam Thapar's CG Power, which has been hit by allegations of financial irregularities

The lender held 12.79 percent stake in CG Power and Industrial Solutions of June 2019.

Shares of CG Power and Industrial Solutions remained on the course of free fall, plunging as much as 20 percent, to hit their fresh all-time low of Rs 11.80 on BSE on August 21.

As per media reports, the Ministry of Corporate Affairs (MCA) has ordered an inspection into the affairs of the company after reports of financial wrongdoings came into the light.

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Himachal Futuristic Communications Ltd (HFCL) on Tuesday said it has bagged Rs 2,467 crore order, its largest purchase order so far, for a turnkey project from public sector telecom service provider BSNL

"The project has an additional operations and maintenance (O&M) component of Rs 862 crore to be realised over a period of 10 years from the commissioning of the project," the company said.

The combined value of the project, therefore, stands at Rs 3,329 crore. The project is to be completed within 18 months.

Investors reacted positively to the new order with the HFCL stock surging 5.31 per cent to Rs 19.85 on the BSE on Tuesday even as the market closed in the red.

Funded by the Department of Telecom (DoT), the turnkey project entails design, development, deployment and maintenance of converged nationwide IP/MPLS backbone with 219 X Access Networks and Integrated IMS based communication solutions under Network for Spectrum (NFS) programme of the Central government.

"We are proud to have been awarded this prestigious project. This advanced next-generation network would be very critical communication network for Indian Army," HFCL Managing Director Mahendra Nahata said.

He also said that the project shall add to the company's profitability and cash flows besides augmenting revenue growth.

"The O&M component, at the same time, shall contribute to the profitability of the Company over a fairly long term," Nahata added.

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In a bid to tighten its noose over audit majors Deloitte and BSR, the Corporate Affairs Ministry (MCA) has filed an application at the Mumbai bench of the National Company Law Tribunal (NCLT) to freeze the assets of the auditors of the defaulting firm IL&FS Financial Services (IFIN) to prevent fund diversion

The plea comes over nearly two months after the MCA asked the tribunal to ban both the firms from audit operations in the country for a period of five years.

According to the Serious Fraud Investigation Office (SFIO), Deloitte had disregarded the Reserve Bank of India's (RBI) regulations and turned a blind eye to IFIN's "evergreening" of loans, and never cross-checked any of the certificates the company used to mislead lenders. 

Both Deloitte and the KMPG arm BSR & Associates, the investigation showed, had failed to fulfil their duties as auditors.

In June, BSR & Associates resigned as the statutory auditor of the financial arm of IL&FS after the MCA sought a ban, while Deloitte was the statutory auditor of IFIN till the financial year 2017-18.

The NCLT has already reserved its order on the plea to ban both the firms. 

The crisis in the infrastructure lending major IL&FS came to light in September last year when it defaulted on its commercial papers, a short-term debt instrument. Following the crisis, the government appointed a new board led by Uday Kotak.

Investigations into the matter have opened a can of worms with both the auditors and the rating agencies of IL&FS and its group companies along with the erstwhile management under the scanner. Few of the previous IL&FS top officials have also been arrested in this connection.

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Bharti Airtel Ltd’s June quarter results will bring relief to investors, especially after the shocking results of Vodafone Idea Ltd. Revenue at Airtel’s mainstay India wireless business grew for the second consecutive quarter. They are up 2.2% from the March quarter, on the back of a 4.3% sequential expansion in the March quarter

In comparison, revenues at Vodafone Idea had fallen 4.3% and resulted in a 22% drop in operating profit on a like-to-like basis. In Airtel’s case, operating profit or Ebitda dropped only by 1.8%. Ebitda stands for earnings before interest, tax, depreciation and amortization.

Drill down further and it becomes clear why Airtel has handled the onslaught of Reliance Jio Infocomm Ltd much better. To start with, the fall in its subscriber base is far lower than Vodafone Ideas.

Importantly, the expansion in mobile broadband towers is better at Airtel, where they rose 2.6% to 177,141 towers. Vodafone Idea saw a mere rise of 1.1% to 157,278 towers.

Note that Vodafone Idea’s revenue is ahead of Airtel’s, even while it's broadband coverage is lower. It isn’t surprising then that Airtel’s total data customer base grew 4.3% last quarter, while Vodafone Idea’s data users fell 2%.

Data usage per customer has seen notable improvement— up 8% vis-à-vis 4.9% in March quarter. As a consequence, the improvement in realization, also known as average revenue per user, is also better at Airtel.

Now that Airtel has reported a steady performance for its India wireless business, it is evident that Vodafone Idea’s underperformance can be explained by company-specific issues. The mega-merger and the time taken to integrate teams and networks have weighed on the latter’s performance.

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The company reported a standalone net profit of Rs 18.59 crore for the quarter ended June 30, 2019, as compared to Rs 23.64 crore in the same period last year, registering a year-on-year decline of 21.36 per cent. Net revenue of the company declined marginally by 2.61 per cent at Rs 854.75 crore in the April-June quarter of this fiscal as against Rs 877.66 crore in the corresponding period last year. During the April-June quarter, operating expenses dropped by 2.81 per cent to Rs 816.98 crore from Rs 840.62 crore in the year-ago period.

Other Income grew by 127.72 per cent at Rs 6.49 crore versus Operating Profit surged by 1.97 per cent to Rs 37.77 crore as against Rs 37.04 crore in the year-ago period, while Operating Profit Margin (OPM) expanded year-on-year to 4.74 per cent in June quarter. Interest grew by 0.00 per cent y-o-y to Rs 2.69 crore, while Taxation decreased by 23.54 per cent at Rs 9.94 crore.

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As many as 33 stocks returned over 10% in the last one-year. These include stocks like Muthoot Finance, ICICI Lombard, PNC Infratech, Varun Beverages, Atul, JustDial, and Aarti Industries

Foreign institutional investors (FIIs), which have pulled out a little over Rs 14,000 crore from the cash segment of Indian equity markets so far in the current month, are still net buyers since July 2018.

FIIs which were mostly net sellers in 2018, turned tables in 2019 by pouring in more than Rs 40,000 crore in Indian markets largely on expectations of continuity of policy and a stable government at the centre.

They have raised stake in nearly 130 companies consistently in the last 4 quarters, which could be seen as a sign of confidence. Out of 129 companies, in which FIIs raised stake listed on BSE, four more than doubled investors' wealth. These include names like Adani Power, Balrampur Chini, Dhampur Sugar, and P&G Health Ltd, data from AceEquity showed.

There are as many as 33 stocks which gave more than 10 percent return in the last one year, which include names like Muthoot Finance, ICICI Lombard, PNC Infratech, Varun Beverages, Atul Ltd, JustDial, Aarti Industries, etc. among others.

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CLSA factored in volume growth for the rest of FY20 as the base is turning benign.

Shares of Tata Motors rebounded nearly 3 percent intraday on July 26 after hitting a fresh nine-year low in early trade after a disappointing show in June quarter (Q1). Global brokerage houses are mixed in their opinion with CLSA cutting price target on the stock.

The scrip touched an intraday low of Rs 138.15, the lowest level since February 2010, but rebounded to day's high of Rs 148.25 which could be due to the positive commentary by the management. At 1031 hours, Tata Motors was quoting at Rs 147.90, up 2.46 percent on the BSE.

CLSA has a sell call on the stock and slashed price target to Rs 120 from Rs 140 per share after cutting FY20-21 EPS estimates by 9-31 percent as the company reported worst pre-exceptional loss-before tax in a decade.

Tata Motors, on July 25, posted a huge loss of Rs 3,698 crore in June quarter, dented by a disappointing performance by Jaguar Land Rover.

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There were pending buy orders of 275 shares, with no sellers available.

Shares of McNally Bharat Engineering was locked at 5 percent upper circuit on July 26 as the company won an order worth Rs 8 crore.

The company has received one order from Krishi Bikash Shiipa Kendra for construction of boundary wall with fencing for SOOMW Solar Power Plant in Jharkhand, McNally Bharat said in an exchange release.

The company had recently won an order from SGTORE Company, a Hong Kong-based firm, for designing and engineering, the supply of equipment, two years spare parts, three months consumables on EPS basis worth Rs 46.70 crore.

At 1014 hrs McNally Bharat Engineering was quoting at Rs 2.61, up 4.82 percent on the BSE.

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His actions in the June quarter reflects his investing philosophy as he has kept his stake constant in most of the companies. Kedia is a believer in the principles of Chinese Bamboo Tree investing and SMILE

Value investor Vijay Kedia kept his stake constant in eight companies for the quarter ended June 2019 even though stock prices fell by about 30 percent in 2019.

These companies include Apcotex Industries, Cera Sanitaryware, Everest Industries, Innovators Façade, Lykis and Sudarshan Chemicals, among others.

He has also reduced his stake in three companies. They are Repro India, Vaibhav Global and Affordable Robotic & Automation.

His actions in the June quarter reflects his investing philosophy as he has kept his stake constant in most of the companies. Kedia is a believer in the principles of Chinese Bamboo Tree and SMILE.

SMILE refers to Small in size, Medium in experience, Large in aspiration and Extra-large market potential. Chinese Bamboo Tree takes time to grow from seeds but then quickly rises to 80 feet. The eponymous investing philosophy alludes to this property of the tree.

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The fall of July series was mainly led by selling pressure from foreign institutional investors (FIIs) desk. They cumulatively sold equities worth Rs. 13,035 crores in July series.

Jay Purohit

The July series kicked off with some long positions and moved higher in the initial days of the new series. However, bulls failed to pull Nifty above the 12,000 mark as we witnessed some selling pressure at higher levels.

The benchmark indices plunged sharply after the announcement of the first Union Budget under Modi.20. As a result, Nifty posted a loss of around 5 percent on an expiry-to-expiry basis, resulting in the worst derivatives expiry since October 2018.

The fall was supported by some short positions, but most of them didn’t carry forward to the next series as the open interest decreased 6.89 percent on a month-on-month basis.

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The company's net premium income was up 14.2 percent at Rs 6,208.1 crore against Rs 5,437.8 crore

Share price of ICICI Prudential Life Insurance Company gained 4 percent in the early trade on July 25 after its quarterly results.

The company's Q1FY20 net profit rose 1.2 percent to Rs 284.9 crore against Rs 281.6 crore in the same quarter last year.

The value of new business margin increased to 21 percent from 17 percent, while the value of new business jumped 27 percent to Rs 309 crore versus Rs 244 crore, YoY.

The company's net premium income was up 14.2 percent at Rs 6,208.1 crore against Rs 5,437.8 crore.

Morgan Stanley has maintained overweight rating on the stock with a target price at Rs 450 per share.

The research house expects premium growth to recover through the year with help from favourable base and expect VNB growth to be sustained in 20-25 percent range over the next three years.

It sees strong growth in protection.

At 0928 hours, ICICI Prudential Life Insurance Company was quoting at Rs 391.50, up Rs 9.25, or 2.42 percent on the BSE.

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The company reported a 17 percent year-on-year growth in June quarter profit at Rs 329.1 crore from Rs 281.5 crore in same period last fiscal.

Share price of Canara Bank shed 4 percent intraday on July 25 as research house Morgan Stanley remained underweight on stock with a target of Rs 220 per share.

The company reported weaker PPoP and asset quality in Q1FY20, while company's Q1FY20 PAT is Rs 300 crore against estimate of Rs 600 crore, said Morgan Stanley.

Lower margins and sequential rise in slippages are the key negatives, while higher fees and lower than expected other operating expenses are the key positives.

The company reported a 17 percent year-on-year growth in June quarter profit at Rs 329.1 crore from Rs 281.5 crore in same period last fiscal.

However, net interest income in June quarter fell 16.6 percent to Rs 3,240.1 crore year-on-year but loan growth was 12 percent at Rs 4.32 lakh crore YoY while deposits grew 14.5 percent to Rs 6.1 lakh crore YoY.

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BofAML said ACC traded at 9.4x CY20 expected EBITDA, which is 11 percent below historical average and Ambuja Cements traded at 9.9x CY20 estimated EBITDA which is in-line with historical average.

ACC and Ambuja Cements rallied 2 percent intraday on July 12 after Bank of America Merrill Lynch upgraded and raised price targets.

The global brokerage house upgraded ACC to neutral from underperform rating and raised price target to Rs 1,695 from Rs 1,586, implying 9 percent potential upside from current levels.

It also upgraded Ambuja Cements to buy from neutral and raised price target to Rs 261 from Rs 238, which implies 23 percent potential upside from current levels.

BofAML said ACC traded at 9.4x CY20 expected EBITDA, which is 11 percent below the historical average and Ambuja Cements traded at 9.9x CY20 estimated EBITDA which is in-line with the historical average.

The brokerage feels recent price hikes should lead to higher unitary profit growth for ACC and Ambuja Cements, and capacity additions in CY20/21 will ease capacity constraints.

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However, with demand showing signs of a slowdown in the consumption space, high rural distress, ongoing NBFC crisis and below normal monsoon could hit earnings growth of India Inc. in June and September quarters

Earnings are vital from an investor's point of view, and more often than not, the market rewards those companies that post robust quarterly results.

The first quarter of FY20 was no different during which more than 50 BSE500 stocks returned in double-digits driven by the respective companies' strong performance in the preceding quarter.

They include DCM Shriram, HDFC AMC, SpiceJet, SBI Life Insurance, HDFC Life, Bajaj Finserv, Bajaj Finance, AU Small Finance, Shree Cements and PNC Infratech, among others.

These stocks surged 10-35 percent in the April-June period on their companies' positive quarter-on-quarter (QoQ) profit during the March quarter, data from AceEquity showed. In the same period, Sensex rose just about 2 percent.

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NLC India | BHEL | Container Corporation | Manpasand Beverages | Autoline Industries and TCS are stocks which are in the news today.

Here are stocks that are in the news today:

Results on July 10: GTPL Hathway, Himachal Futuristic Communications

TCS Q1: Profit grows 0.1 percent to Rs 8,131 crore versus Rs 8,126 crore, revenue increases 0.4 percent to Rs 38,172 crore versus Rs 38,010 crore; dollar revenue rises 1.6 percent to $5,485 million versus $5,397 million QoQ.

Manpasand Beverages: Mehra Goel & Co resigned as statutory auditors due to probe into company by GST authorities.

KRBL: ICRA revised rating on company's banking limits on long term scale to AA- from AA (Stable).

InterGlobe Aviation: Rakesh Gangwal (one of the promoters of company with total holding of 23.1 percent) wrote letter to SEBI seeking its intervention on his alleged grievances. SEBI asked company to gives its response to Rakesh Gangwal's letter by July 19.

SBI: Bank has reduced its MCLR by 5 bps across all tenors with 1 year MCLR coming down from 8.45 percent per annum to 8.40 percent.

Anik Industries: CARE revised rating on company's long term bank facilities to C (issuer not cooperating) from B+/Stable (issuer not cooperating), on account of deterioration in its liquidity due to cash loss reported in FY19 and almost full utilisation of working capital limits.

Garware Synthetics: Ramesh Chandorkar resigned as director of the company.

Nava Bharat Ventures: CRISIL has reaffirmed credit ratings for bank loan facilities of the company at A with stable outlook.

BHEL: An agreement has been signed between company and Container Corporation of India to form Joint Working Group to establish rail based logistics terminal at Haridwar.

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The capital infusion will help some banks to come out of the central bank's prompt corrective action and resume lending and clean up their balance sheets, she added.

The proposed Rs 70,000-crore capital infusion into public sector banks (PSBs) will provide a timely booster to these lenders, S&P Global Ratings has said.

 The move, announced in the Budget, is likely to be credit positive for the banking sector and the economy, S&P said in a note titled 'India's Budget attempts to address trust deficit in the financial sector.

"We believe the capital infusion will help PSBs make necessary haircuts on their weak corporate loans and shore up their capital adequacy," said S&P Global rating credit analyst Geeta Chugh.

The capital infusion will help some banks to come out of the central bank's prompt corrective action and resume lending and clean up their balance sheets, she added.

S&P said it believe PSBs still require substantial reforms to improve risk management, service quality, efficiency, and diversity of product offerings.

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HDFC Bank Limited is our top pick amongst the private sector banks. We re-initiate our coverage on HDFC Bank Limited with a BUY rating and target price of Rs 2820 per share.

Anand Rathi

HDFC Bank is largely a retail bank and earns majority of its revenues and income from the same. Retail and corporate constitute 54 percent and 46 percent respectively to its loan mix as on March 31, 2019.

The company’s advances has registered a CAGR of 22 percent in the last four years. The NII of the company has registered a CAGR of 21 percent in the last four years.

With several process changes, the bank is looking at a massive increase in the number of accounts opened per branch per day from 1.8 to 3 over the next 18 months. This will drive healthy growth in liabilities and offer higher cross-selling opportunities.

Capital constraints in public sector banks will provide an opportunity for the private sector banks to increase their market share and outperform in banking & financial services space.

Further, we expect HDFC Bank to be a major gainer of the current crisis in the NBFC space as it has best-in-class liability franchises along with superior customer outreach across business segments.

Backed by the robust underwriting skills & prudence and the consistent track record of growth and profitability, HDFC Bank Limited is our top pick amongst the private sector banks. We re-initiate our coverage on HDFC Bank Limited with a BUY rating and target price of Rs 2820 per share.

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PNB said Bhushan Power & Steel Ltd misappropriated bank funds and manipulated its books of accounts to raise funds from consortium lender banks.

PSU banking major Punjab National Bank (PNB) tanked over 9 percent intraday on July 8 after it detected an alleged fraud of more than Rs 3,800 crore by Bhushan Power & Steel Ltd (BPSL) and reported it to the Reserve Bank of India (RBI).

PNB said Bhushan Power & Steel Ltd misappropriated bank funds and manipulated its books of accounts to raise funds from consortium lender banks.

"On the basis of forensic audit investigation findings and CBI filing FIR, on suo moto basis, against the company and its directors, alleging diversion of funds from banking system, a fraud of Rs 3,805.15 crore is being reported by bank to RBI," Punjab National Bank (PNB) said in a regulatory filing.

"It has been observed that the company has misappropriated bank funds, manipulated books of accounts to raise funds from consortium lender banks. At present, the case is at NCLT which is in advance stage and the Bank expects good recovery in the account," PNB added.

PNB said its domestic exposure to Bhushan Power & Steel Ltd (BPSL) stood at Rs 3,191.51 crore and overseas exposure at $49.71 million (approx Rs 345.74 crore) at Dubai branch and $38.51 million (approx. Rs.267.90 crore) at Hong Kong branch.

The stock is already down over 20 percent in the last three months. At 10:30 hours, Punjab National Bank was quoting at Rs 74.30, down Rs 7.45, or 9.11 percent. It has touched an intraday high of Rs 77.85 and an intraday low of Rs 73.30.

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To achieve growth in the economy, it is imperative to support the financial services sector.

Hemal Mehta, Dipesh Jain and Dilip Sutar

The expectation from the Union Budget was to focus on strengthening the financial services sector, which is the backbone of India's economic growth. Finance Minister Nirmala Sitharaman announced multiple policies to fuel liquidity in the industry and prioritise infrastructure, education, disinvestment, Naari Shakti and youth energy, among others.

To achieve growth in the economy, it is imperative to support the financial services sector and in this connection, the following measures have been proposed:

1. Relaxation of FDI norms for the aviation, media (animation, visual, gaming and comics) and insurance sectors.

2. 100 percent FDI in insurance intermediaries.

3. Allowing investments in NBFC debt instruments by foreign investors (FPI/FIIs).

4. Government to provide additional capital of Rs 70,000 crore to public sector banks.

5. “Social stock exchange” proposed to be set-up for listing social enterprises and voluntary organisations.

From a tax perspective, there are certain amendments proposed to be introduced that would be welcomed by the industry, such as passthrough of losses (other than business losses) to the unitholders of Categories I and II Alternative Investment Fund (AIF), extending exemption to investment by Category II AIF from the deeming taxation related to issue of shares at a value higher than fair market value.

The Finance Minister has also been forthcoming in introducing various incentives to International Financial Service Centre (IFSC) in terms of bringing in tax-neutral transfers held by Category III AIFs, exempting interest income, extending the deduction to 10 years, etc. The Budget also provides beneficial tax treatments to start-ups.

With a view to providing a level playing field to certain categories of NBFCs vis-a-vis banking companies, it is proposed that certain NBFCs can offer the interest income on NPAs on receipt basis. Deduction of such interest will be on payment basis. Conversion of unpaid interest into a loan is not allowed as deductible expenditure.

To achieve less-cash economy, banks and post offices are obligated to withhold tax on withdrawal beyond Rs 1 crore.

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