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Zomato Q2 loss nearly doubles but revenue jumps; announces three deals

by 5paisa Research Team 11/11/2021

Food delivery platform Zomato Ltd’s consolidated net loss during the three months through September almost doubled from a year earlier as it continued to invest in growing its business

Net loss for the July-September quarter expanded to Rs 435 crore from Rs 230 crore a year earlier and Rs 359 crore in April-June, the company said Wednesday.

Adjusted EBITDA loss increased to Rs 310 crore in Q2 from Rs 170 crore in the previous quarter and Rs 70 crore in Q2 last year.

Adjusted revenue, which includes revenue from operations and customer delivery charges, increased two-and-a-half times to Rs 1,420 crore from Rs 580 crore a year earlier and rose 22.6% from Rs 1,160 crore in the first quarter.

Revenue jumped as more people ordered food online to avoid contracting Covid-19, even though authorities have mostly lifted movement and dining-out restrictions.

This is the second time that Zomato is disclosing its quarterly earnings. The company went public in July after raising Rs 9,000 crore through an initial public offering that was covered 38 times.

Zomato Q2: Other highlights

1) India food delivery gross order value in Q2 grew to Rs 5,410 crore, up 19% from Q1 and 158% year on year.

2) The company sells Fitso to Curefit for $50 million; also invests $100 million in Curefit for 6.4% stake.

3) Zomato to pick up about 8% stake in B2B logistics-tech firm Shiprocket for $75 million.

4) Zomato to buy about 16% stake in hyperlocal commerce startup Magicpin for $50 million.

Zomato management commentary

Zomato founder and CEO Deepinder Goyal said the company’s EBITDA losses went up due to investments in the growth of its food delivery business and cited three reasons.

One, increased spending on branding and marketing for customer acquisition; two, increased investments and growing share of smaller markets in its business (which are less profitable today compared to more mature cities); and three, increased delivery costs due to unpredictable weather and increase in fuel prices.

Goyal also said the restaurant industry bounced back in Q2. Overall customer traffic on Zomato’s platform in India increased to 59 million average monthly active users in Q2 from 45 million in Q1.

“We believe that almost all the restaurants across the country are open for business today. The restaurant industry was one of the most severely impacted sectors from the Covid-19 pandemic and it gives us immense joy to see the restaurant community getting back up on their feet after a prolonged phase of uncertainty for the past 18 months,” he said.

Announcing the three deals with Curefit, Magicpin and Shiprocket, Goyal said Zomato will divest or shut down non-core businesses and will instead invest in businesses that have greater growth potential.

“Including our $100 million investment in Grofers earlier in August 2021, we have now committed $275 million across four companies over the past six months,” he said. “We plan to deploy another $1 billion over the next 1-2 years, with a large chunk of it likely to go into the quick-commerce space.”

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Multibagger Stock: This global tech company has given an astounding return of 323% in one year!

Multibagger Stock: This global tech company has given an astounding return of 323% in one year!
by 5paisa Research Team 11/11/2021

KPIT Technologies has given compounding returns in the last two years, outperforming the benchmark S&P BSE Information Technology.

KPIT Technologies has given multibagger returns of 96.68% in six months, while on yearly basis it has given investors a handsome return of 323% in one year. The global tech company has rallied 15% in the last one week against the backdrop of the lukewarm performance of S&P BSE Information Technology at a loss of 0.2%. The weekly 15% rally was from the levels of Rs 348.40 to Rs 399.65 for KPIT Technologies.

The multibagger has given compounding returns in the last two years, outperforming the benchmark S&P BSE Information Technology.

  1. In three months, the stock has risen 31.83%, the benchmark rose 7.5%.

  1. In six months, the stock has risen 96.68%, when the benchmark rose 26.4%.

  1. In a year, the stock has risen 322.91%, while the benchmark rose 58.8% and;

  1. In 2 years, the stock has risen 344.06%, whereas the benchmark rose 127.1%.

One year ago, an investment of Rs 1 lakh would have fetched you around Rs 3.23 lakh, while an investment of Rs 10 lakh would have compounded into Rs 32.3 lakh in just one year.

KPIT Technologies is a global technology company with software solutions that helps mobility leapfrog towards an autonomous, clean, smart and connected future. With many Automobelievers across the globe, specializing in embedded software, AI & Digital solutions, KPIT enables customers to accelerate the implementation of next-generation mobility technologies. Germany has been the growth engine of the company. The company has been investing heavily in Germany for the last three years. Asia, led by Japan is another solid growth area for the company. The company earns a majority of its revenues from passenger vehicles,(75%), followed by commercial vehicles (23%) and others (2%).

The stock is currently trading at a TTM PE of 64 with a Market Cap of Rs 109561 crore. In the last trading session, the stock touched its 52-week high of Rs 410.45 which is also its all-time high. It has delivered a strong second quarter where the consolidated sales grew 21.7% and net profit by 140% on a YoY basis.

KPIT Technologies is currently trading at Rs 407 at 11.07 am with a gain of 1.73% on the bourses.

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These A and B group stocks are up by 20% in today’s trade

These A and B group stocks are up by 20% in today’s trade
by 5paisa Research Team 11/11/2021

The Indian equity market taking cues from the US market opened with a gap down. This fall got further steeper in the next one and half hours of trade. At 10:50 AM the frontline equity indices are trading down by 1%.

Banking names such as ICICI Bank and HDFC Bank along with IT heavyweights Infosys and TCS are contributing to most of the losses on large-cap indices. One of the reasons for the fall in the IT names is the performance of the Nasdaq. In yesterday’s trade Nasdaq fell most about 1.67%. This was on the back of higher US Inflation, which has hit a 31-year high for the month of October. It increased in October by 6.2% from a year ago. This was the fastest 12-month pace since 1990 and the fifth straight month of inflation above 5%.

The breadth of the market is in favour of decline. Among Nifty 50, there are only two stocks that are trading in the green while 48 are there in red. Among Nifty 50 only Titan and L&T stocks are trading in green rest all are trading in red. Tech Mahindra and Bajaj Finserve are the worst-performing stocks.

Despite such a bloodbath in the market, there are quite a few stocks that are locked in the upper circuit. Some of them have hit 20%.

Following table shows the stocks from Group A and B from BSE that have hit the upper circuit.

Security Code  

Security Name  

Group  

LTP  

Circuit Limit %  

539289  

Aurum Proptech  

A  

114.65  

19.99  

538836  

Monte Carlo Fashions  

B  

523.05  

19.99  

526381  

PATEL INTEGRATED LOGISTICS  

B  

16.1  

9.99  

519224  

WILLIAMSON MAGOR & COMPANY  

B  

37.05  

9.94  

520119  

AUTOMOTIVE STAMPINGS & ASSEMBLIES  

B  

133.45  

5  

532624  

JINDAL PHOTO LTD 

B  

312.1  

5  

541444  

Palm Jewels Ltd 

   

18.9  

5  

500268  

MANALI PETROCHEMICAL LTD 

B  

130.4  

4.99  

524652  

IND-SWIFT   

B  

14.52  

4.99  

532368  

Brightcom Group  

B  

91.6  

4.99  

539979  

Dig Jam 

B  

45.25  

4.99  

590013  

XPRO INDIA LTD 

B  

775.7  

4.99  

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How to save for your child's future expenses and your retirement planning?

How to save for your child's future expenses and your retirement planning?
by 5paisa Research Team 11/11/2021

Financial planning is a very crucial aspect of every individual’s life in order to survive in this world, so it's necessary to adequately plan long term goals such as retirement as well as children's raising.

Raising a child and retirement planning is not an easy task. With increasing inflation, it has become necessary for every individual to save and create some funds for these long-term goals. Preparing a financial plan is tough, and working according to a financial plan can be difficult for some people as everyone cannot afford to pay for the preparation of a financial plan. And this is where the importance of mutual funds is realized.

A mutual fund offers schemes, which may sometimes end up causing stress about future financial goals. Majorly, a financial plan is needed in case of retirement and children’s education expenses, where the finances may take a hit if not planned appropriately.

Solution-oriented funds is one of the best schemes offered by mutual funds. The portfolio of these funds is generally designed in such a way that investors can achieve their specific goals related to retirement and children’s education as well as marriage. As per the Association of Mutual Funds of India (AMFI), assets under management (AUM) of solution-oriented funds have increased from Rs 19,776.71 crore (Retirement Fund AUM - Rs 10,647.82 crore and Children’s Fund AUM- Rs 9,128.89 crore) in October 2020 to Rs 29,246.61 crore (Retirement Fund AUM- Rs 16,294.85 crore and Children’s Fund AUM- 12,951.76 crore) as of October 2021. That is the total AUM of solution-oriented funds, which have risen by approximately 47% in just one year.

Types of solution-oriented funds:

Retirement fund: To cater to the individuals’ retirement planning goals, various asset management companies (AMC) offer retirement funds. This fund assists the individual and provides a financial plan by preserving and creating a corpus for retirement. Investors with higher risk tolerance can invest in equity while investors with lower risk tolerance should invest in debt. And, investors willing to invest in both instruments can invest in a hybrid scheme. Generally, investors should invest in equities in their earning stage and when investors’ age is nearing retirement, then they should switch to debt. This will ensure higher returns with capital preservation. These funds generally have a lock-in period of five years as these funds are shaped for long-term goals. 

Children’s fund: With the increasing cost of education, a financial plan for children’s education has become vital. Without an adequate financial plan, it’s very difficult to educate our children these days. Children’s fund helps investors to create a corpus for their children’s education expenses or marriage expenses. Investors should invest in these funds when either child is yet to be born or just after the child is born. This will help investors accumulate corpus till the child attains the age of schooling or the age of marriage. Investors can invest in equity, debt and hybrid schemes according to their risk tolerance, needs, and goals. These funds generally have a lock-in period of five years.

The following table depicts the top three funds based on a two-year return along with their AUM:

Fund Name  

2-Year Return  

AUM (in crores)  

Retirement Fund  

HDFC Retirement Savings Fund - Equity Plan  

34.13%  

₹1,973.02  

ICICI Prudential Retirement Fund - Pure Equity Plan  

31.98%  

₹124.56  

HDFC Retirement Savings Fund - Hybrid- Equity Plan  

24.37%  

₹748.35  

Children’s Fund  

UTI CCF- Investment Plan  

31.59%  

₹575.59  

Tata Young Citizens Fund  

29.72%  

₹277.45  

HDFC Childrens Gift Investment Plan  

25.64%  

₹5,246.98 

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The lady billionaire who is an inspiration for all: Savitri Devi Jindal

The lady billionaire who is an inspiration for all: Savitri Devi Jindal
by 5paisa Research Team 11/11/2021

Meet the seventh richest person in India

Savitri Devi Jindal is not just a billionaire who has marked her name in the top 10 richest people of India, but she is a role model for all women and men who are smashing the boundaries of patriarchy. As of 11 October 2021, she is ranked seventh richest person in India according to Forbes real-time net worth check. Her net worth currently is at about Rs 1,326 billion.

In India where the majority of the family-owned businesses are run by men, Savitri Jindal makes an exception. She is not only an active businesswoman but also a political leader. She has successfully carried on the legacy of her late spouse Om Prakash Jindal in business and politics as well. OP Jindal was a visionary man who founded Jindal Group and Jindal Steel and Power company. He was also a former minister of power of Haryana. After his accidental death in a helicopter crash in 2005, Savitri Jindal stood strong, contested the elections and was elected as a member of the legislative assembly of Haryana.

After taking over the Jindal conglomerate as a chairperson, the group’s revenues quadrupled and established a leadership position in different businesses. Currently, the four main divisions of the conglomerate group; steel, power, mining, oil & gas, are run by her four sons, Prithviraj, Sajjan, Ratan, and Naveen Jindal. Jindal Steel has become the third-largest producer of steel in India.

Savitri Jindal is not only actively engaged in business and political activities but also in philanthropic and social activities. She has contributed to the education and medical sectors too. She is currently 71, and being a chairperson emeritus, she likes to keep her space from business operations and oversees the various social welfare programs in education and healthcare on behalf of the Jindal Group.

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Aurobindo pharma Q2 profits were gravely hit by decline in generic prices in the US, net profit declined by 13.5% YoY and 9.5% QoQ

by 5paisa Research Team 11/11/2021

In Q2FY22, the company generated net profit of Rs. 6,970mn, down by 13.5% YoY and down by 9.5% QoQ. This effect mainly came from the elevated generic price erosion in the US as channels try to liquidate excess stocks, putting pressure on prices. 


However, US sales grew 7.2% YoY and 10.2% QoQ at US $401m on volume gain in existing products and new launches from the acquired portfolio stood at US $9m sales and Base generic sales (excluding injectables and Natrol) at US $310m grew 8.9% YoY and 13.1% QoQ while generic injectable sales at US $68m grew 5.9% YoY and 9.5% QoQ. Global generic injectables sales were at USD105m (USD68m from the US) in 2Q.

The company has filed for 27 ANDAs including 5 injectables during 2Q (35 filings in 1HFY22 including 7 injectables) and plans to file another 50-55 filings each year for next two years. The company received final FDA approvals for 7 ANDAs including 2 injectables in 2Q which makes a total of 11 approvals in 1H including 5 injectables). It launched 6 products including 3 injectables in 2Q which totals to 11 launches, including 3 injectables during 1HFY22.

The revenues from European markets stood at Rs. 16.6bn and grew 9.7% YoY and 5% QoQ. According to ARBP, there’s still a lot of potential for sales growth in Europe mainly on account of improving capacity utilization (including the penem block), increasing supplies from India (including generic injectables from Unit 4) and rising filings for oncology products (55 dossiers filed of which 12 are approved. There’s also been improvement in profitability for Europe sales with current operating margins in mid-teens which were only in single-digit margins in previous year. 

For Q2 segment wise, RoW revenues stood at Rs. 3.9bn which declined 13.5% YoY on a high base while the sales grew at 17.3% QoQ on patient volume recovery, ARV revenues stood at Rs. 1.5bn which declined at 71.2% YoY and 51.1% QoQ due to lower demand on higher procurement by channels in previous year amid COVID-19 uncertainties and API revenues stood at Rs. 7.8bn which declined 5.8% YoY and 3.9% QoQ on lower demand.

Moving forward, it is estimated that the US segment (~50% of revenues) would remain steady despite visible challenges, the generic sales (excluding injectables) would grow at single-digit sales on account of consistent new launches and volume gains in launched products, and injectables portfolio could also hold strong growth on new launches and patient footfalls recovery in key markets. The company reaffirmed its goal of achieving global sales of US $650-700m from generic injectables by FY24 through portfolio and capacity expansion. Capacity utilization improvement (e.g. for penem block) and completion of Vizag plant should help injectables sales.

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