Tale of the Tape 

Howdy folks. Welcome back to the Daily Rip!

Nifty (+0.1%) and Sensex (-0.1%) ended flat after a mostly boring trading session. Midcaps (+0.4%) and Smallcaps (-0.4%) traded mixed. The advance-decline ratio was in favour of the bears (3:2).

It was a mixed-bag kinda day for sectors. Metals (+3.9%) was the top winner today, followed by PSU Banks (+1.5%) and Oil & Gas (+0.6%). FMCG (-0.4%) and IT (-0.2%) saw minor cuts.

Balkrishna Industries jumped +9% after blockbuster Q4 numbers. Meanwhile, Delhivery (-10%) nosedived after an awful Q4 show. More details below.

Awfis Space Solutions’s Rs 599 IPO opens for subscription tomorrow. Check out our analysis below to help you decide whether to invest.

Tata Steel, Vodafone-Idea and RVNL all saw big movements today. Check out their charts below to find out why.

Block deal reactions. CG Power fell -3% after 65 lakh shares (0.5% equity) changed hands in a big transaction; reports say an FII was the likely seller. Aptus Value Housing Finance cracked -5% after 3.6 cr shares (7.2% stake) changed hands in a large trade; the buyer and seller could not be immediately identified.

Result reaction. Bharat Electronics gained +6% after its Q4 number beat Street estimates. Meanwhile, IRFC rallied +5% intraday after its Q4 net profit jumped +33% YoY.

Hindustan Zinc (+20%) was the top gainer on the NSE 500 as the metals rally continued.

Kalpatru Projects International (+3%) gained after signing 3 contracts with Saudi Aramco with Rs 7,550 cr.

Here are the closing prints: 

Earnings
Earnings Roundup

Balkrishna Industries (+9%) Q4 results beat Street estimates. Solid domestic and global demand helped it post double-digit volume growth, which in turn boosted the topline. Higher-value products + better operational efficiency aided margins & the bottomline. 📊

Here are its stats:

• Revenue: Rs 2,682 cr; +16% YoY (vs Est: Rs 2,404 cr)

• EBITDA: Rs 681 cr; +42% YoY (vs Est: Rs 596 cr)

• EBITDA Margin: 25.4% vs 20.7% YoY

• PAT: Rs 487 cr; +87% YoY (vs Est: Rs 360 cr)

Most brokerages are cautiously optimistic, with Nomura upping its target price to Rs 3,230 p/sh. That said, there are a couple of key risks for FY25. Global demand is still a little uncertain, with the company’s management refusing to provide annual guidance projections. Raw material costs are also inching up and the company said it will hike prices. 📈

Balkrishna Industries is +34% over the last year.

Delhivery (-10%) was the top loser on NSE500 on weak Q4 results! The company’s core ‘express parcel’ shipments biz fell -2% YoY. This was offset by higher freight revenue, but ultimately restricted topline growth. Higher finance and employee costs also prevented margins from seeing a higher bump. FYI - to add salt to injury, the company’s chief business officer has quit and will leave in July. Not exactly what you want when a firm is going through a rough time. 👎

Here is its Q4 report card:

• Revenue: Rs 2,076 cr; +12% YoY

• EBITDA: Rs 46 cr

• EBITDA Margin: 2.2% vs 0.7% YoY

• Loss: Rs 68 cr vs Rs 159 cr loss YoY

Yes, Q4 is a traditionally slow quarter for e-commerce delivery because it comes after the festive season. But even by that standard, Delhivery’s Q4 results aren’t great. FYI - both CLSA and Morgan Stanley have downgraded the stock, with Delhivery already slipping below CLSA’s new target price of Rs 488 p/sh. ✂️

Delhivery is +1% YTD.

IPO

Awfis Space Solution IPO Review

Awfis Space Solutions IPO opens for subscription tomorrow! The price band has been fixed at Rs 364 - 383 p/sh. The company aims to raise Rs 599 cr from the IPO. 💸

Founded in 2014, the company provides workspace solutions. This includes offering co-working spaces and designing and building offices for other companies. FYI - Awfis also provides adjacent services such as food & beverages, IT support and event hosting & meetings. CBRE says it is the LARGEST such provider in India by number of centres. It boasts 1.05 lakh seats, with a total chargeable area of 5.33 million sq feet, to help serve 2,295 clients across the country. Fun fact: the IPO is backed by veteran investor Ashish Kacholia who owns a 5% stake. 💯

FYI - the IPO’s fresh issue comes in at only Rs 128 cr, which is a bit of a bummer. The rest goes the ‘Offer for Sale’ route. The new money raised will be used to open new centres & help fund working capital needs. 🏢

9MFY24 snapshot:

• Revenue: Rs 634 cr

• Loss: Rs 19 cr

Big Picture: Despite good topline growth, the company has reported losses from FY21 to FY23. It’s also on track to report losses for FY24, which sucks. FYI - its profit margins are hurt due to major subcontracting + financing costs. This shouldn’t come as a surprise; many co-working space providers have struggled, the most famous failure being WeWork. That said, its customer concentration is low (a positive), and expects to be net cash positive over the next year. Experts say this is a long-term bet! FWIW - the IPO is reasonably priced and current grey market data suggests a cool 43% premium! 🤑

Charts

Chartbusters

Life comes fast, both for humans and stocks! Here are three companies that saw BIG movements today:

1) Tata Steel hit a new all-time high after signing a power supply deal for its Port Talbot electric arc furnace. FYI - this is a key step for Tata Steel to get the whole thing underway by 2027. ICYMI - ‘going green’ is crucial for the company’s profitability and comes despite major union criticism in the UK! 🔥

2) Vodafone Idea was in focus after Nomura upgraded the stock and DOUBLED its target price to Rs 15 p/sh. They cite successful fundraising, a projected 15% tariff hike and GOI relief on FY25 spectrum payments as clear positive triggers. ✅

3) RVNL also hit a record high after winning a Rs 148 cr order from the South Eastern Railways. FYI - the contract is for upgrading an electric traction system. PS - this comes just days after it reported a solid Q4, with a 33% YoY jump in net profit! 🚅

Links That Don’t Suck

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