Outlook for April-June quarter GDP amid Covid

Crowds are seen shopping during a weekly market in Kandivali.

SOPA pictures | LightRakete | Getty Images

India is expected to see double-digit growth in the three months to June – but economists warn that the data does not give the full picture of the country’s growth path.

South Asia’s largest economy published fourth quarter GDP data on Monday which recorded a growth of 1.6% compared to the same period last year, mainly driven by Government Spending and Manufacturing Growth. For the year as a whole, GDP is expected to decline by 7.3%, compared to growth of 4% in the previous year.

India has been battling a devastating second wave of the coronavirus since February, which accelerated in April and peaked in early May. The infection forced most of India’s developed nations to take localized lockdown measures to slow the spread of the virus.

“With the existing lockdowns, we assume that the economy will tend to slow down in the future,” said Madan Sabnavis, chief economist at Care Ratings, on CNBC’s “Road signs Asia.

“The numbers we get for the first quarter of fiscal 2022 – the quarter that ends in June – can be very misleading,” he said. India’s fiscal year starts in April and ends in March of the following year.

On a (a) sequential basis we will see a double digit decrease in seasonally adjusted data, but you will see strong double digit growth year over year.

In the April-June quarter of last year the economy contracted 23.9% as a months of national lockdown hammered the country. Economists argue that the reported prior-year figure is likely to show double-digit growth for the current quarter, but the strong figure is due to the low base from last year’s negative pressure.

“On a (a) sequential basis, we will see a double-digit decline in seasonally adjusted data, but you will see strong double-digit growth year-over-year,” Radhika Rao, an economist with DBS Group in Singapore, told CNBCs on Tuesday “Squawk Box Asia.

“That’s because it was down 24% at the same time last year,” she added.

However, experts agree that the economic impact of the second wave may not be as severe as it was last year. India has so far avoided another national lockdown, allowing states to implement local shutdowns instead. Economists agree that the country is generally on track to revive growth, but with a delay.

The data likely shows that consumption sequentially lost momentum this quarter due to the second wave as households had to prioritize their hospital and medical expenses, Rao said.

“So domestic demand, which is the main component of growth, is not going to look that good. There are also high-contact services, most of which have been closed, “she said, adding,” Now only until June, some states are starting to talk about reopening. But it is certainly a very staggered and very unpredictable path in terms of lifting the restrictions. “

Many economists have trimmed their full fiscal 2022 growth projections for India. Goldman Sachs, for example, cut its forecast for real GDP growth for the full year from 11.1% to 9.9%.

Analyst on outlook for Prime Glove, Malaysian glove shares

SINGAPORE – The recent fall in prices for Malaysian rubber glove manufacturers is “unjustified,” said an analyst who predicts further uptrend for stocks.

Shares of Top glove, the world’s largest manufacturer of rubber gloves, is down 17.7% this year at the close of trading on Monday. His smaller colleagues Hartalega, Super max and Kossan fell between 18% and 30%.

In comparison, the benchmark FTSE Bursa Malaysia KLCI Index fell by 0.9% over the same period.

Employees at Top Glove, the world’s largest glove manufacturer, will test latex glove production in a waterproof test room at one of the company’s factories in Selangor, Malaysia on February 18, 2020.

Samsul said | Bloomberg | Getty Images

“We are maintaining our overweight position in the sector as we believe the recent decline in share prices is not justified,” wrote Ng Chi Hoong, an analyst at Malaysian investment bank Affin Hwang, in a report on Monday.

The decline in Malaysian glove inventories followed a significant jump in the last year if the Covid-19 pandemic increased demand for medical gloves.

Factors affecting investor confidence in the stocks include a potential decline in glove retail prices with lower demand as more people are vaccinated around the world, Ng said.

In addition, Top Glove’s plans to list in Hong Kong – the third public listing after Malaysia and Singapore – also sparked concerns that the company is raising funds in anticipation of a weaker outlook, he said.

But those concerns are likely to subside, Ng said. Here are its target prices for Malaysia’s glove inventory.

Affin Hwang’s target price for Malaysian glove stocks

Stocks Monday is over (Malaysian ringgit) Guide price (Malaysian ringgit) head
Top glove 5.04 10.10 100%
Hartalega 9.70 5 p.m. 75%
Super max 4.21 10.90 159%
Kossan 3.66 9.30 154%

Challenge to stay above pre-covid levels

The analyst said the increase in average glove retail prices was unsustainable and forecast a 30% to 35% price drop in 2022. Still, prices are likely to stay above pre-pandemic levels for at least the next two to three years. he said.

This is partly because the demand for gloves is expected to continue to grow in the coming years as the medical sector makes more personal protective equipment use, Ng said.

He added that he agreed with the report by consultants Frost and Sullivan, commissioned by Top Glove, which said demand for disposable gloves would grow an average of 15% annually for the next five years.

Such demand growth would be accompanied by a 20% annual supply increase over the next few years, Ng said.

Top Glove is planning a listing in Hong Kong

Another development that has fueled recent price moves in Malaysian glove stocks is Top Glove’s planned third listing in Hong Kong.

The company said last month that it applied for one “dual primary collection” in Hong Kong, that could bring in up to 7.7 billion ringgit ($ 1.87 billion). It said it will keep its current primary listing in Malaysia and secondary listing in Singapore.

Investors reacted negatively to news that the additional listing would dilute Top Glove’s earnings per share.

Nonetheless, Ng has kept his buy recommendation for Top Glove and his Malaysian colleagues. He said the decline in stock prices had lowered valuations to levels “too cheap to ignore”.

The analyst added that Malaysian glove makers have a higher dividend yield and better return on equity compared to their international counterparts – a measure of financial performance.

Top Glove on Tuesday reported an increase in quarterly earnings to 2.87 billion ringgit ($ 695 million) for the three months ended February from 115.68 million ringgit ($ 28.03 million) a year ago.

The company said global demand for gloves continues to be “strong” as the Covid pandemic has led to an increase in glove use and hygiene awareness.

Outlook on the Media & Leisure World Market to 2026 – Rising Want for Quick Web Connectivity With Extremely-Low Latency for OTT Media is Driving Progress


Billionaire Steven Cohen takes on these 3 “Strong Buy” shares

Last week the NASDAQ fell below 13,200, taking the net loss from its all-time high earlier this month to 6.4%. If this trend continues, the index will slide into correction territory, a 10% loss from its peak. So what exactly is going on? Basically, the signals are mixed. The COVID-19 pandemic is starting to fade and the economy is starting to open again – strong positive results that should boost markets. An economic restart, however, brings inflationary pressures: more people work means more consumers with money in their pockets, and the massive stimulus programs that have been passed in recent months – and the law that is now going through Congress and on $ 1.9 trillion – have provided additional funds to people’s purses and liquidity in the economy. There is pent-up demand out there and people to spend, and both of these factors will drive prices up. We can see an effect of this in the bond market, where the ten-year government bond yielded 1.4% near an annual high and has seen an upward trend in the past few weeks. However, this could be a gun jumping case, as Federal Reserve Chairman Jerome Powell told the Senate he was not considering a move to raise interest rates. In other words, these are confusing times. For those who feel lost in the whole stock market fog, investing from gurus can provide a sense of clarity. None more than billionaire Steven Cohen. Cohen’s investment firm, Point72 Asset Management, has adopted a strategy that involves investing in the stock market as well as a more macroeconomic approach. This strategy cemented Cohen’s status as a highly regarded investment powerhouse. The guru made $ 1.4 billion in 2020 thanks to a 16% gain in Point72’s top hedge fund. With that in mind, our focus shifted to Point72’s most recent 13F filing, which reveals the stocks the fund bought in the fourth quarter. TipRanks’ database, which relied on three tickers in particular, found that everyone had an analyst consensus of “Strong Buy” and had significant upside potential. Array Technologies (ARRY) The first new position is Array Technologies, a green tech company providing tracking technology for large solar energy projects. It is not enough to just use enough photovoltaic solar modules to supply an energy supply company with electricity. The panels must track the sun across the sky and take into account seasonal differences as it travels. Array offers solutions to these problems with its DuraTrack and SmarTrack products. Array boasts that its tracking systems improve the life cycle efficiency of solar array projects and that its SmarTrack system can increase total energy production by 5%. The company has impressed its customers with installations in 30 countries in more than 900 supply-scale projects. President Biden is expected to take executive action at the expense of the fossil fuel industry to promote green economic policies, and Array could potentially benefit from this political environment. This company’s stock is new to the markets after it went public in October last year. The event has been described as the “first major solar IPO” in the US for 2020 and was a success. The shares opened at $ 22 and closed at $ 36 on the day. The company sold 7 million shares and raised $ 154 million. Another 40.5 million shares were brought to market by Oaktree Capital. Oaktree is the investment manager who has held a majority stake in the company since 2016. Array fans include Steven Cohen. Point72’s new ARRY position, valued at 531,589 shares in the fourth quarter, is valued at over $ 19.7 million. Guggenheim analyst Shahriar Pourreza also appears confident about the company’s growth prospects, noting that the stock appears to be undervalued. “Renewable energy companies have seen large capital inflows as a result of the ‘blue wave’ and Democratic control of the White House and both houses of Congress. However, ARRY continues to trade at a significant discount to its peers, “noted the 5-star analyst. Pourreza added,” We remain optimistic about ARRY’s growth prospects based on 1) tracker market share gains over fixed pitch systems are due. 2) ARRY market share gains within the tracker industry, 3) ARRY’s great opportunity in the less permeated international market, 4) the ability to monetize their existing customer base over the long term through extended warranties, software upgrades, etc. that represent a high profit margin accretive. “Consistent with these bullish comments, Pourreza is pricing ARRY shares for a buy and its target price of $ 59 implies an uptrend of 59% from current levels. (To see Pourreza’s track record, click here.) New Shares In Growth industries are the main focus of Wall Street pros, and Array has recorded 8 valuations since going public, with 6 buys and 2 holds making the consensus rating for the stock a strong buy, with an average price target of 53.75 USD suggests an uptrend of ~ 45% is possible over the next 12 months. (See ARRY stock analysis on TipRanks.) Paya Holdings (PAYA) The second pick from Cohen we’re looking at is Paya Holdings, a North American payment processing service, the company provides integrated payment solutions for B2B operations in the education, government, healthcare, nonprofit and retail sectors utilities. Paya has over $ 30 billion in payments processed annually for over 100,000 customers. In mid-October last year, Paya completed its market launch via a SPAC (Special Acquisition Company) merger with FinTech Acquisition Corporation III. Cohen stands right on this with the cops. During the fourth quarter, Point72 bought 3,288,843 shares, increasing the size of the stake to 4,489,443 shares. After this 365% increase, the position is now valued at ~ $ 54 million. Mark Palmer, 5-star analyst at BTIG, is impressed by Paya’s medium-term prospects and writes: “We assume that PAYA will achieve revenue growth in old age in the next few years as Integrated Solutions grow in the next few years is set to grow in the mid-20s and Payment Services is expected to grow in the mid single digits. At the same time, from our point of view, the company’s operating costs should increase by 5%. We therefore assume that PAYA’s adjusted EBITDA growth will be north of 20% in the next few years and that its adjusted EBITDA margins will increase from 25% in 2019 to 28% by year 21. “Palmer sets a price target of $ 18 on PAYA shares, showing his confidence in 49% growth for the coming year, and rates the shares as a buy. (To see Palmer’s track record, click here) PAYA’s consensus rating for analysts with strong buying is unanimous based on 4 buy-side ratings set over the past few weeks. The stock has an average price target of $ 16, suggesting an upside potential of ~ 33% from the current stock price of $ 12.06. (See PAYA stock analysis on TipRanks) Dicerna Pharma (DRNA) Last but not least, Dicerna Pharma, a clinical-stage biotech company focused on the discovery, research and development of treatments based on its RNAi technology platform (RNA Interference). The company has 4 drug candidates in various stages of clinical trials and another 6 in pre-clinical trials. The company’s pipeline clearly caught Steven Cohen’s attention – the acquisition of a new stake totaling 2.366 million shares. This stake is valued at $ 63.8 million at current values. The farthest drug candidate down Dicerna’s pipeline is nedosirane (DCR-PHXC), which is being studied for the treatment of PH or primary hyperoxaluria – a group of several genetic disorders that cause life-threatening kidney disease by overproducing oxalate. Nedosiran blocks the enzyme that causes this overproduction and is in a phase 3 study. Top-line results are expected in mid-’21 and if everything goes as planned, an NDA filing for nedosiran is expected towards the end of Q3 21. Analyst Mani Foroohar covers Leerink and sees Nedosiran as the key to the company’s near-term future. “We assume that nedosiran could be approved in mid-2022 and that the drug will be around a year and a half behind its competitor Oxlumo (ALNY, MP) in PH1 … A successful result will be DRNA in a commercial company for rare diseases in an attractive duopoly transforming market with the best label width in the industry, “noted Foroohar. To that end, Foroohar rates DRNA as an outperform (i.e. Buy), and its price target of $ 45 suggests a one-year upside of 66%. (Foroohar’s track record, click here) Overall Dicerna Pharma registered 4 buy ratings making the Strong Buy unanimous. DRNA shares trade for $ 26.98, and their average price target of $ 38 means the uptrend is ~ 41% over the next 12 months (See DRNA stock analysis to TipRanks) To find great ideas for trading stocks at attractive valuations, visit TipRanks’ Best Stocks to Buy, a newly introduced tool that brings together all insights into the shares of TipRanks. Disclaimer: The opinions expressed in this article are solely those of the analysts presented. The co ntent may only be used for information purposes. It is very important that you do your own analysis before making any investment.