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MOSL: Morning India (25/March/20): 1. Strategy (a. Government announces lockdown to fight COVID-19; b. FM unveils relief measures; c. Insider: Promoter Buying/Selling During Market Correction) ; 2. Voltas; 3.

MOrning India (25/March/20):  1. Strategy (a. Government announces lockdown to fight COVID-19; b. FM unveils relief measures; c. Insider: Promoter Buying/Selling During Market Correction) ; 2. Voltas; 3. Metropolis Healthcare

 

Today’s top research theme

Strategy: Government announces three-week lockdown to fight COVID-19

• Prime Minister Mr Narendra Modi has announced an unprecedented three-week lockdown in the country (effective 25th Mar-20) in a bid to contain the spread of coronavirus. While appreciating the nation's support toward the Junta Curfew on 22nd Mar-20, he emphasized the need to become more cautious and continue practicing social distancing in this 'total lockdown.'
• The Finance Minister has announced several measures to ease the regulatory and compliance burden for taxpayers. The FM also promised that an economic relief package will be unveiled soon to alleviate the pain of lockdown in the economy.
• Given the nature of the crisis and the consequent containment measures, forecasting corporate earnings for FY21 has become difficult with existing earnings estimates facing sharp downside risks. In this scenario, it is prudent to look at trailing valuation metrics. Nifty is trading at a trailing P/E of 14.7x, lowest in six years while trailing P/B of 1.9x is at its lowest since the Global Financial Crisis. Market-cap to GDP is at 49%, again lowest since the GFC.

Piping hot news

PM announces 21-day nationwide lockdown as coronavirus tightens grip

Prime Minister Narendra Modi declared a three-week nationwide “complete lockdown" from midnight Tuesday in the world’s largest such exercise aimed at stemming the spread of coronavirus that has infected 557 people and claimed the lives of 10 in the country. “From midnight today, there will be a complete lockdown. To save India, to save every citizen, to save you and your family, from 12am, there will be a complete ban on stepping out of the house. Every state, every village, union territory is being locked down. This is a step further than the Janata curfew. It is a step that is needed," Modi said in a televised address to the nation.