Tale of the Tape 

Hola Amigos! 👋

Nifty (+0.3%) and Sensex (+0.4%) ended higher on heavyweight buying. Midcaps (+0.2%) and Smallcaps (-0.3%) traded mixed. The advance-decline ratio was evenly split. 🤼

It was an even mix of red and green across sectors. FMCG (+1.4%), Real Estate (+1.4%) and IT (+0.7%) saw the most buying. Metals (-0.6%) and Banks (-0.5%) witnessed some profit-booking. 💸

Paytm was up +5% despite rough Q4 numbers. Meanwhile, BHEL cracked -5% after an awful Q4 show. More details below. 📊

Motilal Oswal sees a +31% upside in this clean energy & space stock. Read our story below to find out more. ⚡

PNC Infratech, Gujarat State Fertilizers and JK Tyres all saw big movements today. Check out their charts below to find out why. 📈

Apollo Tyres rallied +5% intraday after 2.25 cr shares, or 3.5% equity, changed hands in a block deal; reports say Warburg Pincus was the likely seller. 🤝

Order wins. Welspun Enterprises jumped +7% after bagging a Rs 1,865 cr highway order. Suzlon Energy rose +4% after winning orders worth 402 MW from Juniper Green Energy in Rajasthan. 🚧

Cipla (+3%) was the top Nifty gainer after getting FDA approval for its pancreatic disease injection. 💊

IPO update. Awfis Space Solutions was subscribed 1.29x on Day 1 of bidding. 💰

Here are the closing prints: 

Earnings
Earnings Roundup

Paytm's first results after the RBI nuke are finally here! As expected, the picture isn’t pretty. Gross merchandise value (GMV) was down -8% QoQ. Average monthly transacting users (MTU) dropped -4% QoQ. PS - MTUs in April 2024 were down -24% compared to January 2024! Taking a step back, losses widened due to the obvious disruptions in the wallet, loans and FasTag biz. Whew. 🤕

Here is its Q4 report card:

• Revenue: Rs 2,267 cr; -3% YoY

• Loss: Rs 550 cr vs loss of Rs 168 cr YoY

Big Picture: If the results were that bad, why did the stock end up +5%? For starters, a lot of this pain was already priced in after Paytm warned of a Rs 500 cr EBITDA hit. But there are also some positive triggers. The company has straight up said it will start firing people to cut costs. FYI - it says its “annualized people cost savings” could be as high as Rs 500 cr, which will offset the RBI blow over the course of FY25. 👍

It has also warned that Q1FY25 could be bad, but it expects to bounce back between Q2 and Q3. We don’t know if this will happen, but markets love theoretical clarity above anything else! 😇

Paytm is -43% YTD.

Bharat Heavy Electricals (-5%) posted a weak set of Q4 numbers! Despite surging power demand, the company’s topline growth was FLAT. Higher raw material prices & provisioning dragged the company’s margins AND the bottomline. ICYMI - domestic copper prices are currently at a record high, along with other commodities that BHEL needs like rubber and steel.

The company also admitted that its gross margins also took a hit due to supply chain issues and project execution delays. Overall, a rough picture and a bad ending to FY24. 🚨

Here are its key stats:

• Revenue: Rs 8,260 cr; +0.4% YoY

• EBITDA: Rs 728 cr; -31% YoY

• EBITDA Margin: 8.8% vs 12.8%

• PAT: Rs 490 cr; -26% YoY

Big Picture: The company tried to talk up its prospects, saying it expects revenue to grow at 12%-15% in the medium turn. It also points towards key orders in the pipeline including one from the GOI for 80 Vande Bharat train sets. 🚆

FWIW - analysts are divided. Nuvama is the big bull here, with a target price of Rs 400 p/sh and a belief that thermal power projects will pick up. CLSA has one of the lowest price targets of Rs 189 p/sh, a whopping -38% downside from current levels. 👀

BHEL is up +53% YTD.

Stocktwits Spotlight

One question we always struggle with is- Is it the right level to buy? Get all your queries answered around your fav stocks. Join in for a fun AMA with SriFunCharts. Drop in all your questions here:

Stock

What’s Popping?

MTAR Technologies has been going through a BUMPY ride. After a great 2022-2023 run, the stock is down -3% so far this year! It has clawed back some of its losses in the past month but is it at an attractive entry point for investors? Let’s take a look. 🔍

For the unaware: MTAR is a leading manufacturer of engineering solutions for the clean energy, space and defence sectors. It has seven manufacturing units and caters to both global private clients as well as the GOI. ♻️

What killed the mood in 2023? Well, the company slashed its revenue AND margin guidance for FY24, citing the deferment of clean energy orders. Higher costs and inventories also took a toll on Q2FY24 and Q3FY24 results which were pretty bad. 📊

Here’s what went wrong: one of MTAR’s largest customers (Bloom Energy) decided that it no longer wanted a key product line due to “design changes''. The last-hour change left MTAR holding a bunch of useless inventory and hurt its FY24 revenue. 👎

Luckily things are changing. The company is on track to ship out a newer, more advanced product that has HIGHER margins to Bloom based on orders from South Korea’s SK Group! This should set the ship right again. Beyond this, MTAR’s space & nuclear segments may gain BIG time from the GOI’s domestic manufacturing push. FYI - experts project order flows of Rs 500 cr alone for two nuclear reactors from the GOI in FY25. 🤑

Big Picture: Motilal Oswal projects that MTAR’s order book will grow at 39% CAGR over FY24-26. This will be helped by domestic market growth + moving up the value chain with key customers. FYI - they have a 12-month target price of Rs 2,800 p/sh; +31% from current levels! 🚀

Charts

Chartbusters

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

1) PNC Infratech (+13%) was the top gainer on the NSE 500, after winning 2 road projects in the state of Maharashtra. Both orders combined are worth a WHOPPING Rs 4,994 cr! To put that in context: its Q3FY24 topline came in at Rs 2,000 cr. Looks like good times are ahead. 💯

2) Gujarat State Fertilizers & Chemicals (-8%) dropped like a rock after posting awful Q4 numbers. Topline was down -18% YoY, bottomline down -89% YoY. Margins came in at just 1.3% vs 13.7% last year. We can only hope that the worst is over. 🤞

3) JK Tyres rallied +10% intraday on strong Q4 earnings. While the topline was only slightly up, it reported a cool 56% YoY jump in net profit. FYI - this comes despite a BIG increase in rubber prices (a major raw material for tyre firms). The company was able to bet on strong premiumisation trends and sell higher-value tyres. 🛞

Check out their charts below: 🔥

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