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Stocks Radar: Bajaj Auto, Bank Of Maharashtra, Tata Motors

Indian shares climbed in opening trade, with most sectoral gauges advancing led by select auto makers and metal counters.

The S&P BSE Sensex gained nearly 0.6 percent to 31,233 while the NSE Nifty rose 0.5 percent to 9,635. The market breadth was firmly tilted in favour of the buyers. About 5 shares advanced to every 1 that declined on the NSE.

Here Are The Stocks Moving The Market This Morning:

Dr Reddy’s Lab: FDA Boost

Shares of the pharmaceutical company fell 1.03 percent to Rs 2,655 after it received Form 483 observation for its formulations plant in Srikakulam.

The U.S. Food and Drug Administration (FDA) completed an inspection and issued Form 483, the company said in an exchange filing. While the drug maker did not disclose details on the nature of these observations, it said it is in the process of addressing them.

On June 18, Nomura’s Saion Mukherjee maintained a ‘Buy’ rating with a price target of Rs 3,321. The stock returned a negative 12 percent so far this year and a loss of 10 percent in the past 52 week.

Tata Steel: Stake Sale Boost

Shares of the steel maker rose as much as 2 percent to Rs 512.50 after its parent Tata Sons said it would buy Tata Motors shares from the company.

The steelmaker will sell its shares worth up to Rs 3,825 crore in the Jaguar Land Rover owner to their parent company. The transaction is expected to be executed on or after June 23, the company’s exchange filing said.

Around 19 analysts tracked by Bloomberg have a ‘Buy’ rating on the stock, while six have ‘sell’ and seven have a ‘hold’. The return potential, however, is only 2 percent at the current market price. It has gained 30 percent year-to-date, compared to 10.6 percent advance in the S&P BSE Metal index.

Bajaj Auto: Three-Wheeler Relief

Shares of the two and three-wheeler maker rose as much as 3 percent, intraday, the most since May 11, after the Maharashtra government removed a cap on taxi and auto-rickshaw permits, according to a report by Hindustan Times.

About 20 percent of analysts covering the company have changed their price targets over the past month (7 up, 3 down, 39 unchanged), Bloomberg data showed. The stock returned 8.5 percent so far this year and a gain of 11 percent in the past 52 weeks.

IPCA Labs: Downgrade Woes

Shares of the drug maker fell 2.81 percent to Rs 472 after broking firm CLSA downgraded the stock to ‘Sell’ from an earlier ‘Buy’. The CLSA analyst also revised the price target to Rs 410 from Rs 650.

On June 16, Axis Capital’s Prakash Agarwal also downgraded the stock to ‘Hold’ from ‘Buy’ with a revised the price target of Rs 475 from Rs 550 earlier.

The drug manufacturer was under pressure since last week, falling over 5.5 percent, after the U.S. regulator denied admission of some of its drugs into the country.

Bloomberg data showed that about 60 percent of analysts covering the company have changed their price targets over the past month (2 up, 13 down, 10 unchanged).

Hotel Stocks: GST Boost

Shares of the hotel operators rallied after the GST Council reduced rates on certain room tariffs. The Council on Sunday fixed 28 percent tax rate for hotel tariffs above Rs 7,500 and 18 percent tax on tariffs from Rs 2500-7500.

  • Indian Hotels (+3% to Rs 131; the biggest intraday jump since May 31)
  • Hotel Leela Ventures (+3.48% to Rs 23.8)
  • Taj GVK Hotels and Resorts (+2.07% to Rs 165.4)
  • ITC (+0.85% to Rs 309.4)

Bank of Maharashtra: RBI Initiates PCA

Shares of the lender fell as much as 4.52 percent, the biggest intraday fall since May 29, to Rs 29.6 after the Reserve Bank of India initiated Prompt Corrective Action (PCA) in the view of non-performing asset, according to an exchange filing.

The stock is down on a high trading volume with 10.5 times its 30-day average volume. The stock returned 4.4 percent so far this year and a loss of 9.9 percent in the past 52 weeks.

Cadila Healthcare: FDA Nod

Shares of the pharma company rose 2.39 percent to Rs 538.1 after Zydus received a final approval from U.S. drug regulator for its anti-migrane medication.

The drug, Eletriptan Hydrobromide, will be produced at its manufacturing facility in Ahmedabad. The stock returned 4.9 percent so far this year and a loss of 9.5 percent in the past 52 weeks.

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