Stocks in Focus on January 11: Snowman Logistics, Jain Irrigation, TCS, Avenue Supermart to Tata Steel; here are the 5 Newsmakers of the Day

The equity market ended with robust gains on Friday, January 8, 2021, mirroring strong global cues. The S&P BSE Sensex, jumped 689.19 points or 1.43% at 48,782.51. The Nifty 50 index rallied 209.9 points or 1.48% at 14,347.55. Both the indices attained record closing high levels. But certain stocks came in news after the market was closed. These stocks can impact the indices when it reopens on Monday

Stocks that are likely to remain in focus on Monday include TCS, Snowman Logistics, Jain Irrigation and Tata Steel. Source: Reuters

The equity market ended with robust gains on Friday, January 8, 2021, mirroring strong global cues. The S&P BSE Sensex, jumped 689.19 points or 1.43% at 48,782.51. The Nifty 50 index rallied 209.9 points or 1.48% at 14,347.55. Both the indices attained record closing high levels. But certain stocks came in news after the market was closed. These stocks can impact the indices when it reopens on Monday, January 11, 2021. List of such five stocks:

Snowman Logistics + Jain Irrigation

Snowman Logistics: Snowman Logistics and Amazon have signed a deal under which Snowman will set-up facilities at three locations, namely Delhi, Mumbai and Coimbatore, sources informed Zee Business. The sources also informed that the company is in talks with Pharma and FMCG companies as well and other big announcements are expected in near future.

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Jain Irrigation: SBI, the lead manager, has approved the resolution plan of the Jain Irrigation Systems last week, sources informed Zee Business. According to the sources, the company will receive promoter funding of Rs 130 crore and the company is likely to split in three parts. With this, the interest cost will come down from Rs 400 crore to Rs 200 crore. Under the approved resolution plan, the company is likely to get sustainable debt at an interest rate of 9% for the next 8 years and 0% interest rates will be levied on unsustainable debt.

Post Market Results: Some companies, like Tata Consultancy Services (TCS) and Avenue Supermart, posted their December quarter results after the markets were closed for trading purposes on Friday. These stocks are likely to be in action today when the market will open for trading purposes. Details:

Tata Consultancy Services (TCS): India’s largest information technology (IT) services firm on Friday reported a 16.4% quarter-on-quarter (QoQ) rise in profit at Rs 8,701 crore for the quarter ended December 31, 2020. The company has posted a profit of Rs 7,475 crore in the quarter ended September 30, 2020. Revenue grew 4.7% to Rs 42,015 crore in Q3FY21 against Rs 40,135 crore posted in Q2FY21. The $ revenue appreciated 5.1% to $570.2 crore in the reported quarter against $ 542.4 crore posted in the previous quarter. EBIT rose 6.4% to Rs 11,184 crore in Q3FY21 against Rs 10,515 crore posted in Q2FY21.

The margin advanced to 26.6% in the reported quarter against 26.2% reported in the previous quarter. Also, the company's Constant Currency Revenue growth 4.1% QoQ. December quarter of FY21 was the strongest third-quarter growth in the last nine years. Highest operating margin in the last 5 years, even after rolling out a salary hike this quarter. Besides, the company has declared an interim dividend at Rs 6 per share. The record date is January 16, 2021, and the payment date is February 3, 2021. The company also saw the lowest ever employee attrition, which stood at 7.60%.

Management Commentary: Rajesh Gopinathan, Chief Executive Officer and Managing Director, said, "Growing demand for core transformation services and strong revenue conversion from earlier deals have driven a powerful momentum that helped us overcome seasonal headwinds and post one of our best performances in a December quarter. We are entering the new year on an optimistic note, our market position stronger than ever before, and our confidence reinforced by the continued strength in our order book and deal pipeline." He added, "This boundaryless value creation, supported by the seamless fabric of technology-enabled by cloud together with the seamless fabric of talent enabled by our SBWS™, will redefine industry after industry over the longer term." V Ramakrishnan, Chief Financial Officer, said: "Strong growth across all our verticals and operational benefits from our SBWS model allowed us to post the highest operating margin in the last five years, even after rolling out a salary increase this quarter.

Avenue Supermarts Ltd: Avenue Supermarts, which owns the hyper-retail chain DMart, on Saturday reported a net profit of Rs 470.25 crore for the quarter ended December 31, 2020, against Rs 394.3 crore posted in the same quarter last year. Revenue grew 10.1% to Rs 7,433 crore in the reported quarter against Rs 6,752 crore reported last year. EBITDA grew 16.6% to Rs 691.4 crore against Rs 593.1 crore posted last year. The margin advanced to 9.3% in Q3FY21 against 8.8% posted in Q3FY20. Management Commentary: Company opened 1 new store during the quarter taking the total store count to 221. There has been slower growth in out of home usage categories like apparel, laundry, footwear and travel. Lesser trips and higher basket values continue to be the norm. Agile OPEX management along with a good surge in festival shopping allowed us to deliver a significantly better quarter than the previous two quarters. However, December month didn’t trend as well as the festival months of October and November. Two years and older DMart stores did 96% of December 2019 sales in December 2020. Restricted store operations in certain cities post-Diwali due to night curfews and weekend closure led to significantly larger declines in those stores versus the same period last year. The company continues to face inconsistent supplies from the non-FMCG sector. Raw material prices are also going up. Availability in certain categories is likely to get worse before getting better. This could therefore have an impact on sales mix and margins in the near term.

Quarterly Updates: Tata Steel, Tata Steel Long Products and Tata Steel BSL, Equitas Small Finance Bank

Tata Steel: Tata Steel India has reported a 3% (YoY) growth in crude steel production at 4.60 million tons for the third quarter of the current fiscal. Deliveries were 4.66 MT in the third quarter, lower by 8% quarter-on-quarter and 4% (YoY). Domestic deliveries sharply ramped up to 4.16 MT. Steel production at Tata Steel Europe grew to 2.61 MT (YoY) in Q3FY21 from 2.51 MT produced in Q3FY20. European delivery fell to 4.66 MT (YoY) in the reported quarter against 4.85 MT posted in Q3FY20. Exports shrank below 11% of overall deliveries.

Tata Steel Long Products: Tata Steel Long Products announced production and delivery volumes for Q3FY21 and said the company achieved direct reduced iron production of 2.13 lakh tons in Q3FY21 compared to 2.21 lakh tons in Q3FY20. Crude steel production reduced to 1.6 lakh tons in Q3FY21 against 1.7 lakh tons in Q3FY20. Direct reduced iron delivery volume fell to 1.6 lakh tons in Q3FY21 compared to 1.9 lakh tons in Q3FY20. Saleable steel delivery volume stood at 1.7 lakh tons in Q3 FY21 compared to 1.6 lakh tons posted in Q3FY20.

Tata Steel BSL: Tata Steel BSL achieved production of 11.09 lakh tons in Q3FY21 compared to 11.54 lakh tons in Q3FY20. The company achieved sales of 11.49 lakh tons in Q3FY21 compared to 12.55 lakh tons in Q3 FY20. Equitas Small Finance Bank Ltd: The company in its third-quarter business update has reported a 19% year-on-year growth in gross advances to Rs 17,385 crore. The growth quarter-on-quarter stood at 4%. Total deposits rose 51% year-on-year and 23% sequentially to Rs 15,862 crore. CASA rose 81% year-on-year and 22% sequentially to Rs 3,967 crore. CASA ratio stood at 25%, unchanged from Q2FY21.

Order Updates: KEC International & Apollo Microsystem

KEC International: The company has won orders worth Rs 1,024 crore across the various business. Wins orders worth Rs 1,024 crore across various businesses. T&D business has won orders in India, Middle East, Africa and the Americas. Railways business won an order for a doubling project, civil business wins order for infra works in the cement segment, solar business won an order for 13.60 MWp rooftop solar project in India while the cables business wins orders for various types of cables/cabling projects in India and overseas.

Apollo Microsystem: Has bagged a supply order from Bharat Electronics worth Rs 49.86 crore with a repeat order clause, for a maximum of 120% of the units originally ordered as per the terms and conditions.

Deals & stake purchase and sold + open offer

Jubilant Life Sciences: Rakesh Jhunjhunwala has bought 1.25 lakh shares of the company with which his stakes in the company went up from 5.74% to 5.82%.

HDFC Bank: ICICI Prudential Life has sold its entire 1.23% stake of the private lender.

Mishra Dhatu Nigam: HDFC AMC has increased stake in the company from 7.10% to 9.13% via open market transaction.

Vedanta: The promoter group has launched an open offer to buy 10% stake in the company. The parent has offered to buy up to 37.17 crore shares from public shareholders at Rs 160 apiece, which is a 10.5% discount to Friday's closing price.

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