Weekly Market Report: Indian markets post weekly gains as rate hike worries ebb; TCS, Infosys, HCLTech and Reliance Jio in news

Tata Consultancy Services (TCS): The IT services and consultancy company reported 19% YoY growth in consolidated revenue in Q3FY23 at Rs 58,229 crore, which above consensus. The net profit rose 11% YoY to Rs 10,846 crore and the software company announced a special dividend of Rs 67 per share and an interim dividend of Rs 8 per share. The IT company reported an operating margin at 24.5% during the reported quarter. Its attrition stood at 21.3% in Q3FY23 as against 21.5% in Q2FY23. The company has an order book of $7.8 billion.

Infosys: The IT behemoth reported a 20.2% year-on-year (YoY) rise in consolidated revenue for the quarter ended December to Rs 38,318 crore. Consolidated net profit rose 13.4% on-year to Rs 6,586 crore. The IT behemoth registered 9.4% QoQ rise in profit and revenue grew by 4.9% QoQ. Revenue in dollar terms increased 2.3% QoQ to $4,659 million and constant currency revenue growth was at 2.4% QoQ for Q3FY23. The company raised its FY23 revenue growth guidance, in constant currency terms, to 16-16.5%, from 15-16% earlier, and EBIT margin guidance remains unchanged at 21-22%.

HCL Technologies: The IT services company reported 19% year-on-year (YoY) growth in consolidated net profit to Rs 4,096 crore. The revenue grew nearly 20% on-year to Rs 26,700 crore. Revenue in dollar terms grew by 5.3% sequentially to $3,244 million with constant currency revenue growth at 5% for the quarter. Total contract value was down 1.6% sequentially to $2,347 million, while the IT attrition rate dropped to 21.7% from 23.8% during the same period. The company lowered EBIT margin guidance to 18-18.5% from 18-19% earlier and revised full year constant currency revenue growth forecast to 13.5-14% from 13.5-14.5% earlier. The company’s board has approved an interim dividend of Rs 10 per equity share for FY23. The record date is set as 20 January, 2023. The payment for the said interim dividend shall be made on 1 February, 2023

Wipro: The company said that its revenue from operation rose to Rs 23,229 crore in Q3FY23 from Rs 20,313.6 crore in the year-ago period. The net profit rose to Rs 3,053 crore in the reported quarter from Rs 2,969 crore in the year-ago period. It has declared an interim dividend of Rs 1 per equity share. The revenue expectations from IT Services business for the full year is expected to be in the range of 11.5% to 12%, in constant currency terms. The attrition has been recorded at 21.2% during the quarter.

Reliance Jio: The telecom arm of Reliance Industries expanded its footprint in Tamil Nadu by unveiling its True 5G services in five cities. The company rolled out 5G services in Coimbatore, Madurai, Tiruchirappalli, Salem, Hosur and Vellore in addition to the facility already being available in Chennai. Reliance Jio has invested Rs 40,446 crore in the state.

Reliance Jio also launched 5G wireless services in 10 cities across 4 states — Uttar Pradesh, Andhra Pradesh, Kerala, and Maharashtra. The 5G services have been launched in following cities: Agra, Kanpur, Meerut, Prayagraj, Tirupati, Nellore, Kozhikode, Thrissur, Nagpur, and Ahmednagar. Moreover, Reliance Jio will invest additional Rs 2,500 crore to deploy 5G network services in Assam. Currently, the company has invested Rs 9,500 crore in the state.

Larsen & Toubro (L&T): The infrastructure conglomerate announced that it has signed an MoU with the Norway-based H2Carrier (H2C) to co-operate towards developing floating green ammonia projects for industrial-scale applications. According to the terms of the MoU, L&T will become a partner for engineering, procurement, construction, installation & commissioning (EPCIC) of the topsides for H2C’s floating process plants. H2C plans to build the P2XFloater hull at yards in Asia and L&T will design and fabricate the topside process and utility modules to produce green hydrogen & green ammonia, including electrolysers, nitrogen generation plant, and ammonia synthesis unit.

L&T’s heavy engineering arm has won multiple significant orders in Q3 of FY23. As per L&T’s classification, the value of the multiple order lies between Rs 1,000 to Rs 2,500 crore. In the overseas market, L&T Heavy Engineering secured orders for one of the heaviest reactors and screw plug heat exchangers for a refinery in Mexico. On the domestic front, L&T Heavy Engineering secured orders to manufacture critical residue upgrading reactors and to design & manufacture high-pressure screw plug heat exchangers with complex Cr-Mo-V steel material for Indian Oil Corporation (IOCL’s) Panipat Refinery P25 Expansion Project.

L&T Technology Services (LTTS): The company has agreed to acquire the smart world & communication (SWC) Business of L&T. This will enable the company to combine synergies and take offerings in next-gen communications, sustainable spaces and cybersecurity to the global market. Smart World & Communication was founded in 2016 to cater to the demands in smart cities, address opportunities and provide smart solutions in the areas of end-to-end communications, city surveillance and intelligent traffic management system for the Government as well as enterprises.

Maruti Suzuki India: The automaker unveiled its Concept Electric SUV eVX at Auto Expo 2023. With this, the company has reinforced its vision of developing sustainable powertrain systems through continuous technological development and innovation. The Concept eVX is a mid-size electric SUV concept designed and developed by Suzuki Motor Corporation, Japan. It offers futuristic SUV design elements with an upright posture and commanding high-seating. The Concept Electric SUV eVX will be powered by a 60kWh battery pack offering up to 550km of driving range. Maruti Suzuki also displayed its range of sustainable product offerings like WagonR Flex Fuel prototype, Brezza S-CNG and Grand Vitara Intelligent Electric Hybrid. The automaker unveiled two new products — Jimny and Fronx — in India as the carmaker seeks to regain 50% market share in the domestic passenger vehicle segment by bolstering its presence in the sports utility vehicle (SUV) space. Fronx has two engine options available — 1.2-litre naturally aspirated K-series engine and 1-litre turbo-petrol engine. Customers can pre-book the vehicles through the official website or at their nearest Nexa showroom.

Tata Motors: The company’s subsidiary, Tata Passenger Electric Mobility, has completed the acquisition of Sanand property as well as the VM plant and machinery of Ford India. Both companies signed an agreement in August 2022 for the acquisition of Ford India’s manufacturing plant at Sanand, Gujarat, for Rs 725.7 crore.

Meanwhile, Tata Motors’ global wholesales increased 13% YoY in the December 2022 quarter to 3.23 lakh units. Passenger vehicles sales were up 23% during the period at 2.25 lakh units. Its subsidiary Jaguar Land Rover saw a 15% YoY rise in wholesale sales volumes to 79,591 units in the December 2022 quarter due to increase in production amid improvement in chip supplies. The luxury carmaker’s retail sales grew by 5.9% to 84,827 units. JLR expects free cash flow to be positive by over 400 million pounds in Q3.

Mahindra & Mahindra (M&M): The company said that the total production in December 2022 was 45,009 units, up by 80% from 24,970 units produced in the same period last year. Revenue was up 48% YoY to 53,577 units in December 2022. Exports during the period under review was 3100 units, up 3% YoY. Separately, Mahindra & Mahindra has announced the dissolution of Mahindra Tractor Assembly Inc., a wholly owned subsidiary of Mahindra Overseas Investment Company (Mauritius) Limited (MOICML) which is a wholly-owned subsidiary of M&M.

Godrej Properties: The company said that it has purchased 60 acres on an outright basis at Oragadam Junction, Chennai. The proposed project is estimated to have a developable potential of approximately 1.6 million square of saleable area, comprising primarily of residential plotted development. The site is strategically located in between GST road and NH-4, just off Oragadam Junction (on the 6-lane SH-48) offering access to other parts of the city via Chennai Bypass Road, Chennai Tiruvallur High Road and Red Hills Road.

Mahindra Lifespaces: The company has acquired a 4.25 acre land parcel with a development value of Rs 400-crore in Bengaluru. The land is estimated to have a developable potential of 4.6 lakh square feet of saleable area. The site is located off Hosur Road close to Electronics City. The first phase of the project will be launched in 2023.

Paytm: The fintech company said its loan distribution business recorded disbursals of Rs 3,665 crore in December 2022, growing 330% YoY. Total disbursements for three months ended December 2022 was Rs 9,958 crore, a growth of 357% YoY. The number of loans grew 117% YoY to 3.7 million in December, and 137% YoY to 10.5 million cumulative loans for the three months ended December 2022. The company said that its average monthly transacting users (MTU) stood at 85 million for the quarter ended December 2022, up 32% YoY. Merchant payment volumes (GMV) for the quarter ended December 2022 at Rs 3.46 lakh crore ($42 billion), YoY growth of 38%. Sahres of the company closed 2.3% higher.

China’s Alibaba Group sold a 3.1% stake in Paytm worth $125 million through a block deal, Reuters reported citing a source with direct knowledge of the matter. Alibaba, which held a 6.26% stake in Paytm as of end of September 2022, sold the stake at Rs 536.95 rupee apiece, the source said. Paytm’s stock fell 8.8% in intraday trade on Thursday.

Adani Ports and Special Economic Zone: The company and Gadot Group of Israel have completed the acquisition of Haifa Port Company (HPC) from the Government of Israel. The consortium had won the bid for HPC, at an offer price of $1.18 billion during July 2022. The concession period of the port is up to 2054.

Adani Enterprises: Adani Group said that it plans to invest Rs 60,000 crore in Madhya Pradesh across mineral exploration, energy, agriculture, renewable energy and coal sectors. The group, however, did not give a timeline for these investments.

TVS Motor Company: The two-wheeler manufacturer said it plans to invest in Madhya Pradesh (MP) for its potential future two-wheeler and three-wheeler expansion in electric and internal combustion engine vehicles. This expansion plan entails an investment of over Rs 1,000 crore and could create direct and indirect employment in Madhya Pradesh of over 2,000 jobs. The announcement was made at the Global Investors Summit 2023 held at Indore.

Coal India: The state-owned company has issued letters of acceptance for nine coal projects to be pursued through mine developer-cum-operator mode. These projects have production capacity of about 127 million tonnes per year. It has six remaining projects in various stages of tendering. Coal India is looking to implement 15 greenfield projects, with capacity 169 million tonnes, via MDO with an investment of Rs 20,600 crore.

Cyient: The company reported better-than-expected results with a 37% jump in quarterly revenue on the back of a slew of acquisitions that helped counter a weak demand in an uncertain economic environment. Consolidated revenue for the quarter ended December 2022 stood at Rs 1,618 crore, compared with Rs 1,183 crore in the corresponding period last fiscal.

Cyient’s subsidiary, Cyient DLM, has filed its draft red herring prospectus with SEBI in relation to its proposed Initial Public Offering (IPO) for listing on BSE and NSE. Cyient DLM’s proposed IPO will consists of fresh issue of new equity shares aggregating up to Rs 740 crore.

Sona BLW Precision Forgings: The company has inked a pact to acquire a 54% equity stake in sensors and software maker NOVELIC for 40.5 million euro. The acquisition is expected to be EPS accretive for Sona Comstar from the first year and offers strong growth opportunities over the medium term. NOVELIC is a Serbia-based company that provides mmWave radar sensors, perception solutions and full-stack embedded systems. Advanced driver assistance systems (ADAS) sensors are a fast-growing category in the automotive industry, with a potential market size of around $43 billion by 2030. It is one of the very few profitable, high-tech, and fast-growing companies in the ADAS sensor space.

PVR: The theatre operator said it has opened three new multiplexes in Jaipur, Bengaluru and Gurugram with a total count of 19 screens. With this, the company has achieved a major milestone of reaching 900 screens across 78 cities in India. The company further said that the opening of these cinemas are in accordance with the expansion strategy of the company to open over 100 screens in the current financial year.

In other news, the Mumbai bench of the National Company Law Tribunal (NCLT) has sanctioned the merger between cinema chains PVR and Inox Leisure. The written order is expected to come out in the next few days. Once the NCLT issues the detailed order copy, the two companies will file the same with regulatory authorities like the Registrar of Companies (RoC) and stock exchanges. The allotment of shares is expected to be completed in the next few weeks.

5paisa Capital: The financial service provider has reported a 2.5% sequential increase in consolidated net profit of Rs 11.02 crore for the quarter ended December FY23. Consolidated revenue from operations stood at Rs 83.76 crore for the quarter, up 5.3% QoQ. For the nine months period from April-December 2022, consolidated profit increased by 212% YoY to Rs 29.15 crore, helped by improvement in quality of acquisition, focus on technology and providing superior trading platforms to customers. Revenue during the same period grew by 18.5 percent to Rs 247.3 crore.