Stocks to Watch; Tata Motors, ITC, HUL, ICICI Bank, JSW Steel, RVNL and others in news

Hindustan Unilever: The leading FMCG company reported a remarkable 3.9 percent year-on-year growth in standalone profit, reaching Rs 2,717 crore for the quarter ending September FY24. This impressive performance exceeded analysts’ estimates, driven by better-than-expected operating margins and lower input costs. Standalone revenue from operations also showed a robust 3.6 percent year-on-year increase, totaling Rs 15,276 crore for the quarter. Notably, the home care segment grew by 3.3 percent, food and refreshment by 2.6 percent, and beauty and personal care by 4.5 percent. The company’s board has approved an interim dividend of Rs. 18 per share for the year.

ITC: The conglomerate spanning cigarettes, FMCG, and hotels reported a standalone profit of Rs 4,927 crore for the quarter ending September FY24, marking an impressive 10.3 percent year-on-year increase, primarily due to higher other income. Revenue from operations, excluding excise duty, also saw a solid 2.6 percent year-on-year growth, totaling Rs 16,550 crore for the quarter. However, there was subdued growth in the agribusiness and paperboards and packaging segments. ITC’s EBITDA grew by 3 percent year over year, amounting to Rs 6,041.6 crore, with the margin expanding by 10 basis points to 36.5 percent during the same period.

Tata Motors: The Tata Group company has made strategic investments by entering into share purchase agreements and other related deals to acquire a substantial 26.79 percent stake in logistics solutions provider Freight Commerce Solutions, known as Freight Tiger. The investment amounts to Rs 150 crore, and the agreement includes a provision that enables Tata Motors to further invest Rs 100 crore over the next two years.

Zomato: SoftBank-owned Svf Growth (Singapore) Pte Ltd is considering a stake sale worth approximately Rs 1,000 crore in Zomato, a major player in the food delivery industry, according to sources. SoftBank plans to sell a 1.1 percent stake through block deals. Svf Growth currently holds a 2.22 percent stake in Zomato as of September 2023, valued at Rs 2,090 crore at the closing price of Rs 111.7 per share on October 19.

Rail Vikas Nigam: The joint venture company, RVNL-MPCC, has been granted a letter of acceptance (LOA) for various civil engineering works, the supply of 50 mm machine-crushed stone ballast, and comprehensive track works related to the gauge conversion project between Nadiad-Petalad and Petlad-Bhadran in the Vadodara Division of Western Railway. The total contract value for these two projects stands at Rs 420 crore.

Natco Pharma: The United States Food and Drug Administration (USFDA) conducted an inspection of the company’s pharma division in Kothur, Hyderabad, from October 9 to October 18. At the conclusion of the inspection, the facility received eight observations, and the company is actively working with USFDA to address and resolve these observations as swiftly as possible.

Jindal Stainless: The stainless steel manufacturer reported a remarkable 74 percent year-on-year growth in standalone profit, reaching Rs 609 crore for the quarter ending September FY24. Additionally, the company recorded a 14 percent increase in revenue, totaling Rs 9,720 crore, and its EBITDA showed a substantial growth of 54 percent, amounting to Rs 1,070 crore during the same period. This impressive performance was primarily driven by robust domestic demand, leading to a nearly 26 percent YoY increase in standalone sales volume, which stood at 5,43,619 metric tonnes (MT) in the second quarter of FY24.

Havells India: The electrical equipment company posted a notable 33 percent year-on-year growth in profit, reaching Rs 249 crore for the quarter ending September FY24, driven by solid operating performance. Revenue from operations for the quarter witnessed a 6 percent increase, amounting to Rs 3,891 crore, with substantial contributions from the switchgear and cable segments. EBITDA for the quarter also demonstrated a significant growth of 30 percent, totaling Rs 373 crore, resulting in a margin expansion of 180 basis points to 9.6 percent compared to the year-ago period, although the overall figures were slightly below analysts’ expectations.

Elecon Engineering: The company secured an order worth Rs 51.41 crore from Arcelormittal Nippon Steel India for the supply and supervision of a pipe conveyor system at Arcelormittal Nippon Steel’s Hazira plant in Gujarat.

United Breweries: Known for its iconic Kingfisher beer brand, the company reported a standalone profit of Rs 107.62 crore for the quarter ending September FY24. This represents a 19.8 percent decline compared to the corresponding period in the previous fiscal year, falling short of analysts’ expectations. The decline in profit is attributed to a lower EBITDA margin. However, the company did witness a noteworthy 12.4 percent YoY growth in standalone revenue from operations (excluding excise duty), which reached Rs 1,888 crore for the quarter.

Indoco Remedies: The United States Food and Drug Administration (USFDA) conducted a pre-approval inspection at Indoco Remedies’ solid oral formulation facility in Goa from October 12 to October 18. This inspection was conducted in relation to two drug product applications (ANDAs) filed from the facility. At the conclusion of the pre-approval inspection, the USFDA issued four observations in Form 483.

Voltas: The home appliances company reported a consolidated profit of Rs 35.68 crore for the July–September period of FY24, marking a significant improvement compared to a loss of Rs 7.41 crore in the same period last fiscal year. The profitability in Q2 FY23 was impacted by an exceptional loss of Rs 106.43 crore. Additionally, the company’s consolidated revenue from operations grew by 29.65 percent year-on-year, amounting to Rs 2,293 crore for the quarter. Furthermore, Voltas has received board approval to raise up to Rs 500 crore through NCDs on a private placement basis.

Grasim Industries: Collector (Stamps), Registration & Stamp (Anti-Evasion), Special Circle Rajasthan, Jaipur, imposed a penalty and interest of Rs 117.71 crore on Grasim Industries, an Aditya Birla Group company. The penalty is related to an alleged non-payment of stamp duty amounting to Rs 23.68 crore on a scheme of arrangement between Indian Rayon & Industries and Grasim, which was implemented in the financial year 1999 in Rajasthan. The company is taking the necessary legal steps, and the financial impact of this matter is yet to be determined.

IL&FS Transportation Networks: The company has finalized a restated share purchase agreement with Sekura Roads to sell and transfer its entire equity shareholding in subsidiary Jorabat Shillong Motorway (JSEL) for Rs 1,343 crore. This transaction is aimed at settling the liabilities of JSEL, which total Rs 1,621 crore. Importantly, all the liabilities of JSEL have been adjusted against the enterprise value of Rs 1,343 crore.

Paras Defence and Space Technologies: Paras Aerospace, a subsidiary of Paras Defence and Space Technologies, has received a type certificate from the Directorate General of Civil Aviation (DGCA) for its agri-drone, Paras-Agricopter V2.1. This certification will facilitate the execution of existing contracts and open up new opportunities in the agricultural drone industry.

Cyient: The digital, engineering, and technology solutions company reported a consolidated profit of Rs 178.3 crore for the July–September period of FY24, representing a 6 percent sequential increase. The company’s consolidated revenue from operations also grew by 5.5 percent quarter-on-quarter, amounting to Rs 1,778.5 crore during the quarter.

Hatsun Agro Products: The dairy company posted a profit of Rs 77.6 crore for the quarter ending September FY24, marking an 82.6 percent increase compared to the corresponding period in the previous fiscal year. This growth was partly supported by higher other income and improved EBITDA. Additionally, the company reported a 9 percent increase in revenue from operations, reaching Rs 1,905.4 crore for the quarter.

Sigachi Industries: The microcrystalline cellulose powder manufacturer announced that its subsidiary, Sigachi MENA FZCO, based in Dubai, has established a joint venture with Saudi National Projects Investment (SNP) to venture into the rapidly growing Saudi Arabian market. In this joint venture, Sigachi MENA FZCO will hold a 75 percent stake, while SNP will hold a 25 percent stake.

Tanla Platforms: The CPaaS (Communication Platform as a Service) provider reported a 29 percent year-on-year growth in profit, amounting to Rs 142.5 crore for the quarter ending September FY24. Furthermore, the company’s quarterly revenue from operations crossed the significant Rs 1,000 crore mark for the first time, with a 19 percent year-over-year growth, reaching Rs 1,008.6 crore.

Equitas Small Finance Bank: The bank reported a profit of Rs 198 crore for the quarter ending September FY24, reflecting a 70 percent increase over the same period in the previous year. This growth was attributed to a decrease in provisions and an improvement in asset quality performance. Notably, net interest income grew by 25.6 percent year-on-year, amounting to Rs 765.6 crore during the quarter.

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