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Equity Alert: IEX tanks 26% on regulatory nod for market coupling norms

MUMBAI--1300 IST--Shares of Indian Energy Exchange tanked 26% to INR 139.02 on Thursday and are currently at a level last seen in June 2024. The shares fell as the Central Electricity Regulatory Commission approved the implementation of 'market coupling' norms with the Day Ahead Market.

"...(market coupling) will be negative for IEX as volumes will shift to other competing exchanges and thwart the 85% market share of IEX," ICICI Securities said in a note. Day Ahead Market is the biggest segment of IEX in terms of volumes traded, the broking firm said. IEX is scheduled to report its June quarter earnings later in the day. Market coupling will lead to a uniform price for electricity across different trading platforms or exchanges.

Under the initial phase, coupling of the Day-Ahead Market will be implemented by January, under which, different power exchanges will take turns to act as market coupling operators, reports said. Grid-India will act as a backup and audit operator, reports said. These changes are made in accordance with Power Market Regulations of 2021.

Trading in the stock was suspended. More than 29 million shares of IEX were traded on the NSE, over four times the 7 million shares traded till the same time on Wednesday. The stock is down for the seventh straight session. In the last six days, it has fallen 11%. The company's market capitalisation has plummeted 26% or INR 43.58 billion so far Thursday. Currently, its market capitalisation is INR 123.96 billion.

Brokerage Bernstein has maintained its 'market-perform' rating on the stock but cut the target price by 24% to INR 122. The brokerage expects transaction charges to come down sooner due to increased competition. It also sees the decision on 'market coupling' to be felt on IEX's market share.

UBS, which has a target price of INR 285, has maintained its 'buy' rating on the stock. The brokerage sees the development as a "negative surprise," NDTV Profit reported. (Gopika Balasubramanium)

Equity Alert: Trent dn 3%; Goldman Sachs downgrades stock, cuts target price

MUMBAI--1230 IST--Shares of Trent fell over 3% to an intraday low of INR 5,175, the lowest level since May 9, after global brokerage Goldman Sachs downgraded Trent due to higher-than-expected cannibalisation on similar launches. At 1220 IST, the stock traded 3.3% lower at INR 5,183.50.

Goldman Sachs has downgraded Trent to 'neutral' from 'buy' rating and cut its target price to INR 5,500 from INR 6,970, CNBC-TV18 reported. The brokerage has cut its 2025-26 (Apr-Mar) sales and earnings per share estimates for the company to reflect higher-than-expected cannibalisation impact, the report said. Cannibalisation refers to the reduction of sales of a company's product as a consequence of the introduction of another similar product, it said.

While Zudio continues to grow faster than the apparel market, the pace of market share gains will likely be slower than expected, the brokerage said. The brokerage had earlier estimated that Trent's Zudio would have a 5% market share in India's overall apparel market by FY35. The stock could continue to trade in a range around the current levels until there is a sign of inflection, it added.

At 1220 IST, 805,613 shares of the company were traded on the NSE, sharply higher than the 218,773 shares traded till the same time Wednesday. (Akash Mandal)

Equity Alert: Bajaj Finance shares down over 1% ahead of Apr-Jun earnings

MUMBAI--1227 IST--Shares of Bajaj Finance snapped a five-day winning streak and were down over 1% at INR 956.30 ahead of the company's June quarter earnings later Thursday. This is despite expectations of 18% on-year rise in the company's net profit and 26% on-year increase in net interest income. At 1227 IST, almost 3 million shares of the company had changed hands on NSE against nearly 5.4 million shares traded till the same time Wednesday.

Brokerages expect the company's assets under management to help lift its net profit for the June quarter. However, on a sequential basis, the company's net profit is expected to rise much slower due to a modest growth in net interest income.

Out of 18 brokerage reports on the company available with Informist, 14 have a 'buy' or equivalent rating on the stock with an average target price of INR 965. Four brokerages have a 'hold' or equivalent rating with an average target price of INR 941. (P. Madhu Kumar)

Equity Alert: Tata Consumer up 4%; Q1 growth strong, margins seen recovering

MUMBAI--1205 IST--Shares of Tata Consumer Products gained nearly 4%, reaching an intraday high of INR 1,104.50, following on-year growth in both its top line and bottom line for the June quarter. The rise is despite its consolidated net profit coming in slightly below the consensus estimate. Some brokerages remained optimistic about the company's strong revenue growth and potential margin recovery going ahead. At 1122 IST, the stock traded 1.9% higher at INR 1,083.

"The management is targeting 16?ITDA (earnings before interest, taxes, depreciation and amortisation) margins by 3QFY26 and also stated that 2QFY26 margins should be better than 1QFY26...We remain strong believers in the top line growth opportunity in the organised packaged foods business in India and on TATACONS as a strong play on this theme," Nirmal Bang Equities said in a report. The brokerage expects margins to recover from the December quarter.

According to Systematix Institutional Equities, raw material costs, especially tea prices, are expected to moderate further. "Earnings were largely impacted by sharp tea cost escalation, only 70% of which has cumulatively been covered by pricing so far. While this resulted in gross/operating margins declining...TCPL highlighted that tea costs have come off by 13% YoY in July, and expects further easing here, all of which should support a margin recovery from end-2Q/3Q," the brokerage said. The brokerage also noted tea volumes will pick up quickly when prices start to fall further.

At 1122 IST, 4.12 million shares of the company were traded on the NSE, sharply higher than the 310,525 shares traded till the same time Wednesday. (Akash Mandal)

Equity Alert: Nestle India falls 5%; Q1 PAT down YoY, misses Street's view

MUMBAI--1158 IST--Shares of Nestle India fell over 5% to an intraday low of INR 2,324.10 after the company's bottom line for the June quarter fell on year and missed analysts' estimates. The stock, which was trading around 0.8% lower ahead of its result, fell further after the earnings announcement. At 1158 IST, the stock was 5.1% lower at INR 2,327.20 and was the worst hit in the Nifty 50.

The fast-moving consumer goods behemoth reported a net profit of INR 6.59 billion for the June quarter, down 12% on year and below the Street's estimate of INR 7.40 billion. The company's top line, however, rose 6% on year to INR 50.96 billion. The company's expenditure for the quarter rose over 9% on year to INR 42 billion, outpacing the revenue growth.

At 1158 IST, 980,304 shares of the company were traded on the NSE, sharply higher than the 138,582 shares traded till the same time Wednesday. (Akash Mandal)

Equity Alert: Coforge plunges to 2-month low as Q1 results disappoint Street

MUMBAI--1115 IST--Coforge plunged 9% to a near two-month low of INR 1,683.70 as the company's consolidated net profit and sales for the June quarter were lower than expected. The stock is down for the third straight session, declining 10% in these sessions. At 1115 IST, the shares were down 7.8% at INR 1,705.70. More than 6.26 million shares have been traded so far on NSE, 10 times the 622,749 shares traded on Wednesday.

Late Wednesday, the company reported a consolidated net profit of INR 3.17 billion for the quarter ended June, up nearly 22% on quarter, but missed the Street's expectation of INR 3.39 billion. Its consolidated revenue from operations rose more than 8% from the March quarter to INR 36.89 billion, but also failed to meet the consensus estimate of INR 37.26 billion.

The company's earnings before interest and tax and EBIT margin for the June quarter were below estimates, Morgan Stanley was quoted as saying by NDTV Profit. The global brokerage said the $44 million sequential rise in IT company's executable order book was lower than expectations of an increase of $55 million. As of Jun. 30, the company's order book executable over next 12 months grew nearly 47% on year to $1.55 billion, its investor presentation showed. Morgan Stanley has an 'overweight' rating on the stock with a target price of INR 1,880. The target price implies an upside of 10.1% to the spot price. (Gopika Balasubramanium)

Equity Alert: Persistent Systems at 3-month low; analysts mixed on Q1 results

MUMBAI--1058 IST--Shares of Persistent Systems fell over 9% to a three-month low of INR 5,086 as analysts were mixed on the company's performance in the June quarter. While the company's bottom line came in higher than analysts' expectations, some analysts pointed to a slowdown in select segments. At 1057 IST, the stock was down 8.4% at INR 5,136. The stock is the worst hit in the Nifty 200.

"If one were to nit-pick, higher contribution from licence sale (38% QoQ) means services growth was softer at 2.5% QoQ (USD terms), fuelling concerns of slowdown...TCV (total contract value) growth - 13% YoY - stayed below revenue growth, another investors' argument against sustainability of growth momentum," JM Financial said in its report. "Slowdown in top healthcare account, a key growth driver over past few quarters, may further compound worries," it added.

Brokerage Prabhudas Lilladher also pointed out some concerns for the company. "The revenue performance (+3.3% QoQ) was tad below our estimates (+3.5% QoQ CC), margins at 15.5% were also slightly below our estimates of 15.7%...the delayed ramp up and right-shifting of resources have led to the decline in Healthcare vertical," the brokerage said.

However, analysts were still broadly positive on the company's long-term prospects. "The ongoing investments in AI, cloud, and digital transformation services reinforce its competitive edge in the IT services space...we remain optimistic about PSYS's growth trajectory, given its consistently robust financial performance, strong deal wins, pricing premium over peers, and strategic focus on AI and platform-driven services," Nirmal Bang Equities said.

As of 1057 IST, 1.81 million shares of the company were traded on the NSE, sharply higher than the 96,848 shares traded till the same time on Wednesday. (Akash Mandal)

Equity Alert: Dr Reddy's up 3?spite Q1 miss; analysts bullish on new products

MUMBAI--1035 IST--Shares of Dr. Reddy's Laboratories rose over 3% to a near two-week high of INR 1,287.90 as analysts are bullish on the company's growth prospects despite its June quarter bottom line being below estimates. At 1030 IST, the stock was up 2.4% at INR 1,277.60 and was the top gainer in the Nifty 50.

"While the numbers were a miss, we think all attention is on new growth drivers such as GLP-1s and biosimilars," Nuvama Institutional Equities said in a report. The biosimilars mentioned by the brokerage include Abatacept, used in the treatment of autoimmune diseases, and Pembrolizumab, which is used in in cancer immunotherapy.

JM Financial is also bullish on the company's launch pipeline. "With Semaglutide and Liraglutide launches in near-term, DRRD (Dr. Reddy's) remains best placed among generic players to benefit from the upcoming generic GLP-1 wave...overall the stock remains attractive, vs large cap peers," the brokerage said. It has maintained a 'buy' rating on the stock and raised the target price to INR 1,521 from INR 1,418.

Nirmal Bang Equities is cautious but has maintained a positive view on the company's future growth drivers. "We remain constructive on DRL's branded generics strategy and collaborative approach, supported by continued investments in biosimilars, complex generics, and innovation-driven assets," it said in a report. The brokerage has maintained a 'hold' rating on the stock but raised its target price to INR 1,357 from INR 1,291.

At 1030 IST, 2.02 million shares of the company were traded on the NSE, sharply higher than the 287,494 shares traded till the same time Wednesday. (Akash Mandal)

Equity Alert: Indices down after opening flat, Nifty IT falls more than 1%

MUMBAI--0930 IST--Benchmark indices slipped into the negative territory after opening flat Thursday. At 0941 IST, the Nifty 50 was down 0.2% at 25181.50 points and the Sensex was down 0.2% at 82548.60 points. Most information technology stocks fell, with heavy weights such as Infosys and Tata Consultancy Services dragging the Nifty 50 down. Both stocks were down 0.5%.

Hero MotoCorp, Trent, and Kotak Mahindra Bank were the biggest laggards in the 50-stock index. On the other hand, Dr. Reddy's Laboratories rose nearly 3% and was the top gainer among the Nifty 50 stocks as some analysts are positive on the company's future prospects despite its bottom line for the June quarter coming in below the Street's estimate.

Among the companies that will announce their earnings later in the day, Bajaj Finance was down 0.6?spite expectations of the company posting strong earnings for Apr-Jun. Nestle India gained for the second consecutive session and was up 0.4%. Analysts expect the company to report a mid-single digit growth in its top line for the June quarter.

The Nifty IT index was down nearly 1% and was the worst performing sectoral index. Nifty Realty and Nifty Private Bank were down 0.3?ch. The Nifty Healthcare and Nifty Pharma indices were up nearly 1?ch and were the top gainers among the sectoral indices.

Samvardhana Motherson International was the top gainer in the Nifty 200 universe, rising nearly 3%. Indian Railway Finance Corp. and Biocon gained nearly 2%. Among the Nifty 200 losers, Persistent Systems declined over 7?spite posting a marginally higher-than-expected consolidated profit for the June quarter. (P. Madhu Kumar)

Equity Alert: Indices seen in range; India-UK free trade deal eyed

MUMBAI--0807 IST--Benchmark indices are likely to be in range Thursday and the overall sentiment is expected to remain positive this week, analysts said. While indices may attempt rising this week, the momentum could be hampered by negative reaction to corporate earnings. Investors also eye a free trade deal announcement between India and the UK, with reports suggesting that Prime Minister Narendra Modi will sign the pact Thursday during his visit to London.

Options data also suggests that the Nifty 50 may rise further this week if it manages to cross 25250 points. However, the near-term upside is likely to remain capped as traders sold contracts at the 25600 strike price, alongside deep in-the-money strike prices between 26600 and 27000 on Wednesday. On Thursday, the index is likely to move in the range of 25000-25250 points.

The July contract of the GIFT Nifty shows a muted start for the market. At 0753 IST, the contract was at 25297.00 points, broadly unchanged from its previous close. On Wednesday, the Nifty 50 had closed at 25219.90 points, up 159 points or 0.6%. The BSE Sensex had ended at 82726.64 points, up 539.83 points or 0.7%.

Overnight, indices in the US ended higher as investors were buoyed by progress on trade talks after US President Donald Trump announced a deal with Japan. The European Union and the US are nearing a trade agreement similar to that with Japan, that would impose 15% tariffs on European imports, Reuters reported. Most Asian indices were higher in early trade Thursday, with the Japanese markets leading the gains for the second straight session after sealing a trade deal with the US. (Akash Mandal)

Equity Alert: Most Asian mkts up in early trade; Japan's Topix at record high

MUMBAI--0803 IST--Most Asian indices extended the previous sessions's gains in early trade as sentiment was positive after US President Donald Trump struck a reasonable agreement with Japan. Reports also said that the US will sign a similar deal with European Union, lowering the import duties on European goods to 15% from 25?rlier. Japan's Nikkei 225 and Topix continued to be the outperformers. Meanwhile, Australian indices were marginally lower.

At 0801 IST, Japan's Nikkei was at 41991.12 points, up 2%, and Topix was nearly 2% higher at 2981.8 points. Earlier in the trading session, Topix hit its all-time high of 2984.25 points. This was primarily due to upbeat sentiment among investors following the country's agreement with the US which lowered import duties to 15% on Wednesday.

Among other indices, South Korea's Kospi gained 0.8% in early trade. The South Korean economy expanded by 0.6% sequentially in Apr-Jun, dodging a technocal recession, CNBC reported, citing advance estimates from the Bank of Korea. This was also higher than the 0.5% rise expected in a Reuters poll, and a rebound from the 0.2% contraction seen in the March quarter.

Meanwhile, FTSE Singapore Straits Times was up 0.5%. The index also hit its lifetime high at 4256.14 points. China's CSI 300 and Hong Kong's Hang Seng were up 0.3-0.4%. Australia's S&P ASX 200 was the only index in red.

Following are the levels of key Asian indices at 0801 IST:

(Gopika Balasubramanium)

Equity Alert: US indices end higher on likely promising US-EU trade deal

MUMBAI--0735 IST--US indices ended higher Wednesday as traders rejoiced the possibility of a trade deal between the US and the European Union with lower import duties likely on European goods, similar to the agreement US President Donald Trump landed with Japan. Both S&P 500 and the Nasdaq Composite closed at a record high once again on Wednesday.

The White House's deal with the EU would include a broader 15% tariff on EU goods that enter the US coast, Reuters reported, quoting two diplomats. This rate could also extend to cars imported from the region to the US, the report said. "The key thing is the markets have confidence that the White House is going to continue to work through these trade deals," Reuters reported Larry Tentarelli, chief technical strategist for Blue Chip Daily Trend Report, as saying.

The S&P 500 closed 0.8% higher at 6358.91 points and the Nasdaq gained 0.6% to end at 21020.02 points on Wednesday, ending at their respective lifetime highs. The Dow Jones Industrial Average closed at 45010.29 points, up 1.1%.

Tesla closed slightly higher ahead of its quarterly earnings report. Investors will focus on the updates from the electric vehicle maker's analyst conference call. Meanwhile, shares of GE Vernova closed 14.6% higher after the power equipment maker raised its revenue and free cash flow forecasts and beat Wall Street estimates for June quarter profit.

Following are the closing levels of US indices Wednesday:

(Gopika Balasubramanium)

End

US$1 = INR 86.39

IST, or Indian Standard Time, is five-and-a-half hours ahead of GMT

Edited by Ashish Shirke

All prices from National Stock Exchange, unless otherwise specified.

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