Market Update 24 Dec. 2020 – Ambuja and ACC rally on renewal of pact with Holcim

Tata Motors maintains JLR guidance amid UK port issues

  • Shares of Tata Motors (+3.9%) surged after the company stated that Jaguar Land Rover is not affected by issues at ports in the UK. Congestion mounted at ports in the UK as France banned UK freight over fresh Covid concerns.
  • Further, the company maintains its guidance of improved growth, profitability and cash flow in the second half of the year. The stock has recovered from Monday’s fall of nearly 9% and was the top Nifty50 gainer today.

Whirlpool rises on optimistic commentary

  • The management of Whirlpool India expects double-digit growth in Q3 and Q4 of this fiscal. The pent-up demand for home appliances as people are spending more time at home is helping boost sales.
  • Further, the company has reached out to overseas suppliers (in China and South-East Asia) to set up shop in India so that they can benefit from the incentives provided under the ‘Make in India’ programme. The stock gained 12.7% today.

Aurobindo Pharma inks pact to make vaccine

  • Aurobindo Pharma has signed an exclusive agreement with the US-based Covaxx to develop, produce and sell its Covid vaccine in India and to UNICEF. Covaxx is currently conducting Phase 1 trials of its vaccine.
  • Interestingly, this vaccine candidate does not require freezing for distribution. Meanwhile, Aurobindo Pharma will expand its manufacturing capacity to be able to make 48 crore doses by June 2021. Its shares rose 2.3% today.

Divestment plans boost BEML and ITDC

  • The government could take up the strategic sale of two PSUs—BEML and ITDC—over the next few weeks. For FY21, the government has set a target of ₹1.2 lakh crore from divesting its stake in PSUs.
  • BEML (+7.5%) mainly manufactures rail and metro coaches and mining equipment, whereas ITDC (+12.2%) is primarily in hospitality and runs the Ashok Group of hotels.

Ambuja and ACC rally on renewal of pact with Holcim

  • Cement majors Ambuja and ACC have renewed their pact with Holcim for technology and know-how (TKH). The pact has been renewed on existing terms (TKH fees will continue at 1% of net sales) for two years starting January 2021.
  • The status quo on fees triggered a relief rally in Ambuja (+3.8%) and ACC (+1.9%) as market concerns over higher fees were laid to rest.