Stocks to Focus: LIC, Eicher, Concor, Garden Reach, ABB India, Nazara, Biocon
Stocks to Watch on Friday, August 9: The benchmarks Sensex and Nifty50 are expected to start on a high note, driven by positive global cues. At 6:31 AM, GIFT Nifty futures saw a surge of 230 points, trading at 24,367, indicating a strong opening for Indian stocks. Asian markets were active, mirroring the performance of Wall Street. The Nikkei rose by 1.58 percent, the Kospi advanced by 1.60 percent, and the ASX200 by 0.60 percent.
Life Insurance Corporation: In Q1FY25, LIC of India reported a 9% increase in consolidated net profit to Rs 10,544 crore. Total income rose to Rs 2,10,910 crore, with first-year premium increasing to Rs 7,470 crore and renewal premiums to Rs 56,429 crore. Net income from investments also increased to Rs 96,183 crore. LIC's market share grew to 64.02%, and assets under management (AUM) reached Rs 53,58,781 crore. LIC's office in Bangladesh has partially resumed operations amid ongoing challenges.
Eicher Motors: The company's consolidated net profit for Q1FY25 rose by 20% to Rs 1,101 crore, driven by favorable commodity prices, inventory benefits, and positive volume growth in the Royal Enfield (RE) segment. Total revenue from operations increased by 10.2% to Rs 4,393 crore. EBITDA rose by 14.1% to Rs 1,165.5 crore, with a margin of 26.5%. Royal Enfield sold 2,27,736 motorcycles in Q1FY25, a slight increase from the previous year. VECV, another division of Eicher Motors, reported revenue of Rs 5,070 crore and a profit after tax of Rs 319 crore.
Container Corporation of India: State-run CONCOR reported a 14% increase in net profit to Rs 3.17 billion ($38 million), driven by growing volumes in its export/import (EXIM) segment. Total revenue increased by 6.4% to Rs 23.25 billion, with EXIM revenues rising by 9%. The EXIM segment, which was recovering after two years of sluggish performance, helped CONCOR regain market share from private operators. Analysts noted that the dedicated freight corridor (DFC) connectivity from Gujarat ports to Delhi hinterlands would aid CONCOR’s EXIM segment. However, higher rail freight costs led to a 5.3% increase in total expenses.
Garden Reach Shipbuilders and Engineers: In Q1FY25, GRSE reported a 13% increase in net profit to Rs 87 crore, propelled by a 34% rise in revenue from operations to Rs 1,010 crore. Earnings per share improved to Rs 7.6. Despite the growth in profit, the net profit margin contracted to 8.64%. Moreover, GRSE signed Memorandums of Understanding (MoUs) with various companies to bolster technical capabilities and achieve self-reliance in underwater surveillance.
ABB India: The company's net profit for Q2FY24 increased by 50.3% year over year to Rs 443.5 crore. Revenue from operations also saw a 12.8% rise to reach Rs 2,830.9 crore. EBITDA surged by 55.6% to Rs 542.5 crore, resulting in an EBITDA margin of 19.2%. The profit before tax for the quarter amounted to Rs 594 crore. Additionally, the company has a robust order backlog of Rs 9,517 crore and has declared an interim dividend of Rs 10.66 per share.
Nazara Technologies: The company acquired UK-based Fusebox Games for Rs 228 crore. Fusebox, known for interactive story-based games, reported Rs 87 crore in revenue and Rs 11.7 crore in EBITDA in 2023. Nazara has approximately Rs 900 crore in cash reserves for further acquisitions. The company also received an LOI for acquiring Smaaash Entertainment and recently acquired DeltiasGaming.Com.
Biocon: The company reported a 550.5% increase in net profit for Q1FY25, amounting to Rs 659.7 crore. This growth was primarily driven by a gain of Rs 1,057.3 crore from a transaction in its Biologics business. Revenue from operations also saw an 8.3% increase, reaching Rs 2,613.4 crore. In March 2024, Biocon's Biologics business finalized a deal with Eris Lifesciences for the sale of its business. Additionally, the company proposed a final dividend of Rs 0.5 per equity share, pending shareholder approval.
Steel Authority of India: In the first quarter of fiscal year 2025, SAIL's consolidated net profit fell by 61% year-on-year to Rs 81.78 crore. This decline was attributed to weaker domestic steel prices resulting from increased competition from China. Consolidated revenue from operations also dropped by 1% to Rs 23,997.8 crore. The standalone net profit took a significant hit, plunging 92.3% to Rs 11 crore from Rs 150 crore. Revenue from the Salem Steel plant fell by 14%, and Bokaro steel plant revenue dipped by 22.4%. On the other hand, Bhilai and Rourkela steel plants saw increases in revenue. The lower Net Sales Realization (NSR) and exceptional items were cited as the factors impacting the profit.
Bharat Forge: The company's net profit for Q1FY25 was Rs 269.4 crore, which was below expectations due to an exceptional loss of Rs 146 crore. The revenue for the quarter was Rs 2,338 crore, showing a 10% year-on-year increase. The EBITDA increased by 18.7% to Rs 651.3 crore, with margins expanding by 200 basis points to 28%. Bharat Forge secured new orders worth Rs 980 crore across various sectors. The Defence business reported a 147% jump in revenue to Rs 642 crore, with an executable order book of Rs 5,400 crore.
IRCON International: The company's consolidated net profit increased by 19% to Rs 224 crore, up from Rs 187.36 crore last year. However, revenue from operations declined by 17% to Rs 2,287 crore from Rs 2,763.84 crore, resulting in a Rs 477 crore reduction year-over-year. EBITDA rose by 13.3% to Rs 357 crore, achieving a 15% margin. On a standalone basis, the total income fell to Rs 2,278 crore from Rs 2,693 crore, and standalone revenue from operations decreased to Rs 2,180 crore from Rs 2,626 crore. Despite this, standalone profit after tax increased by 9.2% to Rs 177 crore from Rs 162 crore.
Vedanta: The company has decided to postpone the sale of its steel business after successfully completing a $1 billion share sale, which has helped to alleviate its financial pressures. The initial goal of the sale was to raise around $2.5 billion in order to reduce the company's debt. However, potential buyers were discouraged due to environmental and regulatory concerns. It's worth noting that Vedanta acquired a 90% stake in ESL Steel Ltd. in 2018 to enter the steel business. Although the sale is on hold for now, the company may reconsider it in the future.
Page Industries: The company reported an increase in first-quarter profit to Rs 165 crore, up from Rs 158 crore last year. The rise was driven by strong demand for athleisure products. Revenue from operations increased by 4% to Rs 1,278 crore. Input costs decreased by 10% to Rs 260 crore, but total expenses rose by 4%. The EBITDA margin contracted to 19% from 19.4%. The company noted subdued consumption growth but sees early signs of recovery.
HUDCO: The state-run Housing & Urban Development Corporation (HUDCO) plans to raise up to $1 billion through external commercial borrowing (ECB) in FY25, as part of its projected Rs 35,000 crore ($4.17 billion) borrowing for the year. The company aims to reduce funding costs through diverse sources, including FCNR, ECB, and bonds. This increased borrowing aligns with the government's plan to build 30 million affordable homes under the Pradhan Mantri Awas Yojana (PMAY) scheme. HUDCO is expected to finance a significant part of the Rs 7.8 trillion required by the state for this initiative.s.
Power Finance Corporation: PFC has secured a loan of 25.5 billion Japanese yen (approximately Rs 147 crore) from the Japan Bank for International Cooperation (JBIC) for a wind energy project. This long-term loan is a part of JBIC’s GREEN initiative and is co-financed by Sumitomo Mitsui Banking Corporation and other Japanese banks. JBIC will also provide a guarantee for the portion of the loan co-financed by these private financial institutions. The loan proceeds will finance the 300.3 MW wind energy project of Ostro Kannada Power Private Ltd (OKPPL) in Karnataka.
Oil India: The company's Q1 standalone net profit declined by 9.1% YoY to Rs 1,466.8 crore, while revenue (excluding excise duty) increased by 17.7% to Rs 5,331.9 crore.
Astral: The company's net profit increased by 0.5% year-over-year to Rs 120.4 crore for Q1FY25. Revenue from operations rose by 7.8% to Rs 1,383.6 crore. EBITDA also saw a 5.9% increase to Rs 213.8 crore, with an EBITDA margin of 15.5%. Astral launched Astral Paints in Gujarat and Karnataka, achieving a decade-high gross profit percentage of 40.55%. The consolidated cash and bank balances amounted to Rs 552.8 crore.
Phillips Carbon Black: PCBL reported an 8.1% year-over-year increase in net profit, reaching Rs 118 crore for Q1 FY25, up from Rs 109 crore in the previous year. Revenue from operations also saw a significant increase of 59%, totaling Rs 2,143.6 crore. EBITDA surged by 70% to Rs 358.2 crore, resulting in an EBITDA margin of 16.7%. PCBL achieved its highest-ever sales volume at 1,53,918 metric tonnes per annum (MTPA), with Speciality Black sales volume increasing by 33%. Export sales volume grew by 56%, and green power generation increased by 24% to 194 megawatt-hour (MU).
Wipro: The IT services company has partnered with US-based Cyble to improve enterprise cybersecurity risk management through AI-driven threat intelligence solutions. The collaboration integrates Cyble’s AI systems with Wipro’s security expertise to provide real-time threat intelligence, proactive attack surface management, and comprehensive risk assessments. This partnership aims to strengthen businesses against advanced cyber threats and ensure early threat detection with effective responses.
Mahindra & Mahindra: The company has received a GST notice regarding the use of the ‘Mahindra’ brand name by various group companies. The show-cause notice asks M&M why it should not pay GST on the services it provides to its subsidiaries by allowing them to use the flagship brand and logo for the period of 2017-2023. The notice raises questions about the GST authorities widening the interpretation of the law, applying the tax to “related party transactions” even when no consideration is exchanged. This scrutiny follows similar notices issued to several builders in Mumbai earlier this year.
GAIL India: The company has partnered with Rajasthan Rajya Vidyut Utpadan Nigam (RRVUNL) to optimize the operations of RRVUNL’s gas-based power plants in Rajasthan. Both entities will collaborate to establish around 1,000 MW of solar and wind projects.
