Tale of the Tape 

Good evening everyone. Welcome back to the Daily Rip! 👋

Nifty (+0.9%) and Sensex (+0.8%) closed up for a second straight day. Midcaps (+0.8%) and Smallcaps (+1.3%) also followed suit. The advance-decline ratio was in favour of the bulls (4:1) 🐂

It was a sea of green across sectors. PSU Banks (+3%), Pharma (+1.3%) and Auto (+0.9%) saw the most buying. 🤑

Has the IT sector bottomed out or is more pain in the offing? Read our top story below to get the full Q4 review. 🔍

HDFC Bank (-1%) put out a mixed set of Q4 numbers. Meanwhile, IREDA (+6%) had an awesome Q4. More details below. 📊

Gujarat State Petronet (-19%) and Persistent Systems (-9%) got KO-ed today. Voltas (+6%) however saw a nice bump. Check out their charts below to find out why. 🔥

Yes Bank (+5%) was in focus amidst reports of interest from large foreign institutions. Emirates NBD, Mitsubishi UFJ and Sumitomo Mitsui Banking Corp are likely in the race. 💯

Dr Lal Pathlabs was up +3% after Morgan Stanley initiated coverage on the stock; it sees +18% upside from Monday’s close. 🚀

Sterling and Wilson was locked in a +10% upper circuit after guiding for big potential orders from RIL and its Nigeria biz. 💰

Zomato (+2%) hiked its platform fee for the fourth time in the last year to Rs 5 per order. 🍔

Zydus Lifesciences gained +4% after launching a bladder treatment drug in the US. 💊

Vodafone-Idea (-3%) FPO was oversubscribed 3x on the final day. ✅

Here are the closing prints: 

Earnings
Earnings Roundup

HDFC Bank (-1%) Q4 results were a bit of a mixed bag. Loan growth stood at +2% QoQ, while deposits were up +7.5% QoQ. This is a POSITIVE because the lender has been suffering from a lack of deposits. FYI - its loan-to-deposit ratio improved to 104% vs 110% last quarter (ideal range is 85%-90%). 👍

It’s beyond this that things get fuzzy. The lender’s profit is basically flat QoQ. The PAT was boosted by HDFC Credila’s sale in the March quarter. It was also made worse by a whopping Rs 10,900 cr in floating provisions. Bulls say HDFC is using its one-off Credila gain to be prudent. Bears say the provisions hide a potential sign of greater distress. Everything else was flat or had minor changes: asset quality, CASA ratio (+50 bps) and net interest margins. 📊

Here are its Q4 stats (FYI - YoY numbers are not comparable due to the merger):

• Net Interest Income: Rs 29,078 cr; +2% QoQ (vs Est:

• PAT: Rs 16,512 cr; +1% QoQ (vs Est: Rs 18,361 cr)

• GNPA: 1.24% vs 1.26% (QoQ)

• Net NPA: 0.33% vs 0.31% (QoQ)

Big Picture: HDFC is quickly becoming one of those stocks where you can cherry-pick what you want to see based on your position. It received a big upgrade from Jefferies today (TP: Rs 1,880 p/sh; +24% upside). But it’s not clear if the fundamentals fully back that right now at least. 🧐

HDFC Bank is down -10% over the last year.

IREDA (+7%) jumped after reporting solid Q4 results! Strong growth across key verticals helped boost its lending book. FYI - its overall loan book jumped 27% YoY to hit Rs 59,698 cr in FY24. Asset quality improved, while its net interest margins held up as well (2.85% vs 2.82%). This helped boost the bottomline, along with a one-off bump in other income. 💰

Here is its Q4 report card:

• Net Interest Income: Rs 481 cr; +35% YoY

• PAT: Rs 337 cr; +33% YoY

• GNPA: 2.36% vs 3.2% YoY

• Net NPA: 0.9% vs 1.66% YoY

The PSU may have lost some steam after its big bull run, but it ends FY24 on a solid note!  FYI - the company has also set up a subsidiary to cater to the GOI’s big rooftop solar scheme, which should power growth in FY25. 🌤️

IREDA is +187% over the last year.

Specials

Yes Bank: 5-Minute Review!

Want to know the latest updates on Yes Bank share? Check out our latest video where we break down all the key updates on Yes Bank, covering both fundamental and technical analysis. Also, find out SEBI RAs’ views on the stock. 👇🏻

Stocks

IT Q4 Earnings Review

The IT sector wrapped up FY24 on a weak note! Going into this year, we knew things weren’t going to be pretty. A US slowdown, reduced IT spendibg, and BFSI sector troubles have lingered. But are we turning a corner for the sector? Here’s what Q4’s takeaways tell us: 🤓

1) Contract wins: Everyone has something to show off. TCS’s record-breaking $13.2 billion Q4 order book, Infy’s highest-ever deal TCV at $17.7 billion and so on. The only problem? Order wins are no longer translating to revenue. Almost every top exec admits it too, pointing out that customers are going ahead with projects that have an immediate ROI. In other words, ‘tech transformation’ deals that see benefits 3-4 years down the road are being paused. 👎

2) TCS is pulling ahead?: Everyone posted bleak CC revenue growth, but there’s a pecking order now. Infosys is the lowest (-2.2% QoQ), followed by Wipro (-0.3% QoQ) and then TCS (+1.1% QoQ). This is also reflected in EBIT margins. TCS posted a +100 bps bump in Q4, followed by Wipro (+40 bps) and then Infosys (-40 bps). To be clear, it’s not like TCS is doing great, just a little bit better than the others right now. ⚔️

3) Headcount woes: All three put together reported a full-year decline of 63,759 in headcount numbers. For some like TCS and Infosys, this is the first drop in DECADES, which is INSANE. Analysts have debated whether this is due to weak demand, over-hiring during Covid boom years or effects of AI tools. But the problem here is that lower hiring isn’t boosting margins ENOUGH, so it shows how demand has really nosedived. 🧑‍💼

Big Picture: TCS and Wipro show some positive signs for investors who are looking really hard to find them. But the companies themselves are maintaining a muted outlook. TCS says FY25 will be better but hasn’t said how much. Wipro has guided for -1.5%-0.5% growth for Q1FY25. Infosys projects revenue growth of 1%-3% in CC terms for FY25. 💸

Charts

Chartbusters

One day you're on top of the world, the next you're a clown! Here are three stocks that saw their fortunes changed for the better or worse:

1) Gujarat State Petronet: The company was the top NSE 500 loser, cracking -18%, after the regulator SLASHED tariffs for its high-pressure network by a whopping -47%. The stock also got two big downgrades from Nomura and Kotak. 🚨

2) Persistent Systems: The stock fell -9% after a meh set of Q4 results. What’s got analysts worried are its margins (which missed expectations) and its guidance for FY25. ICYMI - Persistent had a great FY24 run, leaving it with overstretched valuations. Profit booking also played a role in taking it down today. 😣

3) Voltas: The stock was up +7% after becoming the clear winner of this year’s heatwave! UBS has raised its target price to Rs 1,800 p/sh; a whopping +30% upside from current levels. The brokerage believes Voltas has made big market share gains recently helped by its new supply chain & vastly improved cost structure. 🚀

Links That Don’t Suck

💯 Buy Yes Bank shares? BIG Targets on Yes Bank | Yes Bank share analysis

💬 Stocktwits is hosting a free AMA with SEBI RA Kush Ghodasara. Click to ask 

👀 PM's "Wealth To Infiltrators" Jab, Manmohan Singh's 2006 Speech, A Huge Row 

👩‍❤️‍💋‍👨 Tinder gets a ‘Share My Date’ feature for users to send date plans to their curious friends 

🐐 Jude Bellingham stuns Barcelona with last-gasp Clasico winner for Real Madrid 

🌎 10 Surprising Facts About Earth Day

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