Stocks in Asia extended recent gains from a nine-month low, and followed U.S. shares higher, amid optimism the upcoming earnings season will be sufficiently robust to overshadow a rise in trade tensions.
Equities in Japan, South Korea and Australia rose after the S&P 500 Index climbed for a third day toward the upper end of its trading range.
The Singapore-traded SGX Nifty, an early indicator of NSE Nifty 50 Index’s performance in India, traded 0.4 percent higher at 10,908 as of 7:10 a.m.
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- HCL Tech to consider share buyback on July 12.
- GSFC says it expects to get Rs 693 crore subsidy from the Fertiliser Department.
- SRF plans to set up a BOPET manufacturing line and resin plant in Thailand for $60 million.
- Gayatri Projects declared lowest bidder for two packages of Purvanchal Expressway project worth Rs 2,759 crore.
- PNC Infratech declared lowest bidder for two packages of Purvanchal Expressway project worth Rs 2,520 crore.
- Sadbhav Infra said its first quarter toll revenue up 13.9 percent to Rs 275 crore.
- Bajaj Hindusthan to seek shareholders’ nod for sale of Lalitpur Power Generation to Bajaj Energy, a related party for Rs 1.097.53 crore.
- IVRCL appoints liquidator as NCLT orders start of liquidation process for subsidiary Hindustan Dorr Oliver.
- Rajshree Sugars says lenders declare the loan account of the company as NPA.
- Astral Polytechnik to acquire 51 percent stake in Rex Polyextrusion for Rs 75.22 crore.
- Shree Renuka said its Brazil unit’s lenders approved new recovery plan.
- PPAP Automotive started production at its Gujarat plant.
Earnings To Watch
- TCS
- Indusind Bank
- Prakash Industries
Earnings Reactions To Watch
Dish TV India (Q1, YoY)
- Revenue at Rs 1,656 crore
- Net profit at Rs 28 crore
- Ebitda at Rs 557.5 crore
- Margins at 33.7 percent
- Videocon D2H merged with Dish TV on March 22, thus Q results are not comparable.
Uttam Galva Steels (Q1, YoY)
- Revenue down 90 percent at Rs 92 crore.
- Net loss of Rs 366 crore versus net loss of Rs 192.5 crore.
- Ebitda down 29 percent at Rs 6 crore.
- Margins at 6.5 percent versus 0.9 percent.
Data To Watch
- 10:30am: India car sales data for month of June
Bulk Deals
Century Enka
- Aequitas Investment Consultancy bought 3.16 lakh shares or 1.4 percent equity at Rs 230.05 each.
- Camden Industries sold 6 lakh shares or 2.7 percent equity at Rs 230.02 each.
- Promoter Cygnet Industries sold 3.06 lakh shares or 1.4 percent equity at Rs 231.86 each.
Manappuram Finance
- Quinag Acquisition (FPI) Ltd bought 2.6 crore shares or 3.1 percent equity at Rs 105 each.
- WF Asian Reconnaissance Fund Limited sold 2.69 crore shares or 3.2 percent equity at Rs 105 each.
JBF Industries: IFCI Ltd sold 4.60 lakh shares or 0.6 percent equity at Rs 39.86 each.
Corporate Actions
- Talwalkars Better Value Fitness Ltd move out of ASM framework.
- Jagran Prakashan buyback period from July 10 to 23.
- City union Bank Limited ex-date for 1:1 bonus.
- Solara Active Pharma Sciences Ltd last trading day before shifting to B group.
- Minda Industries Limited last trading day before ex-date for 2:1 bonus.
Who’s Meeting Whom
- All Cargo Logistics to meet Jeetey Investments Pvt and Ambit Capital on July 10.
- MIRC Electronics to meet Reliance PMS and other investors on July 10.
- Magma Fincorp to meet Ramesh Damani Finance, Credit Suisse and other investors on July 10.
Insider Trades
- Omaxe Ltd promoter Nakul Goel sold 2.50 lakh shares from July 4–5.
- Man Infra promoter Vatsal Shah acquired 69,000 shares on July 6.
Rupee
- Rupee closed at 68.72/$ on Monday from 68.88/$ on Friday.
Trading Tweaks
- Talwalkars Better Value Fitness moves out of ASM framework.
- Jagran Prakashan’s buyback period from July 10 to 23.
- City Union Bank ex-date for 1:1 bonus.
- Solara Active Pharma Sciences’ last trading day before shifting to B group.
- Minda Industries’ last trading day before ex-date for 2:1 bonus.
F&O Cues
- Nifty July Futures closed trading at 10,859.8, premium of 6.9 points versus 5.8 points.
- July series: Nifty open interest up 5 percent and Bank Nifty open interest up 10 percent.
- India VIX ended at 12.3, down 0.4 percent.
- Max open interest for July series at 11,000 Call (open interest at 37.3 lakh, up 6 percent).
- Max open interest for July series at 10,600 Put (open interest at 52.3 lakh, up 2 percent).
F&O Ban
In ban: IDBI Bank
Only intraday positions can be taken in stocks which are in F&O ban. There is a penalty in case of a rollover of these intraday positions
Active Stock Futures
Put-Call Ratio
- Nifty PCR at 1.52 versus 1.51
- Nifty Bank PCR at 1.19 versus 0.99
Brokerage Radar
Credit Suisse on Reliance Industries
- Initiated ‘Outperform’ with a price target of Rs 1,180.
- Reliance Jio Infocomm may be worth $10.4 billion.
- Jio’s revenue can double in three years and contribute 10-40 percent of operating income by March 2025.
- New refining and petrochemical projects will drive over 20 percent earnings per share growth in 2018-19.
- Current softness in gross refining margins may subside in medium term.
- Petcoke gasification can add $2.4 per barrel to refining margin.
Macquarie on Indian Refiners
- IMO 2020 sulfur regulations a game-changer for oil industry.
- Expect middle distillate cracks doubling to $30 per barrel in 2020.
- Substantial demand from shipping industry to double the cracks.
- RIL: Upgrade to ‘Outperform’ from ‘Underperform’; hiked price target to Rs 1,240 from Rs 830.
- HPCL: Maintain ‘Outperform’; hiked price target to Rs 570 from Rs 500.
- BPCL: Maintain ‘Outperform’; hiked price target to Rs 555 from Rs 490.
- IOCL: Maintain ‘Outperform’ with a price target of Rs 270.
JP Morgan on DLF
- Maintained ‘Overweight’ with a price target of Rs 280.
- Near term investment thesis is predicated on pick up in residential sales.
- Monetisation for Phase 5 developments unsold inventory to be faster.
- Move towards completed accounting to aid net profits materially over the current and the next financial.
Morgan Stanley on HDFC Bank
- Maintained ‘Overweight’ with a price target of Rs 2,570.
- Initial updates is net positive.
- Updates highlight accelerating loan growth.
- Expect CASA ratio to improve in coming quarters.
BoA-ML on Dish TV
- Maintained ‘Buy’ with a price target of Rs 90.
- Strong results with revenue and operating income beating estimates after 3-4 quarters.
- Company well placed to deliver strong margins led by synergy benefits.
- Find valuations cheap in-context of growth.
Goldman Sachs on Dish TV
- Maintained ‘Neutral’ with a price target of Rs 76.
- Surprised by the magnitude of ARPU uptick; await more details.
- Despite strong ARPU, remain uncertain on sustainability of such ARPU.
- Availability of cheap data and launch of JioGigaFiber to put pressure on industry.
Goldman Sachs on Colgate
- Maintained ‘Buy’ with a price target of Rs 1,452.
- Lower prices indicate management's increased focus on re-gaining market share.
- Believe new products in natural segment will arrest its market share declines.
- Expect volume growth and market share performance to improve over the current financial year.
Kotak Securities on Oberoi Realty
- Upgraded to ‘Buy’ from ‘Reduce’; hiked price target to Rs 560 from Rs 535.
- Expect more promising 2018-19 on account of Thane launch and cash generation from Three Sixty West.
- Improving pace of execution and sales at Mulund will further bolster investor sentiment.
- Expect under-leveraged balance sheet to allow Oberoi secure new development prospects.
Deutsche Bank on Petronet LNG
- Maintained ‘Buy’ with a price target of Rs 310.
- Remain confident that there exists limited threat of competition for Dahej terminal.
- Regas margins at Dahej lowest due to lower capex costs.
- Expect demand growth from industrial sector, as industrial recovery picks up pace.
- Higher incremental LNG demand in FY19 to ensure high utilisation rate for Dahej terminal.
HSBC on Equitas and Ujjivan
- Risk/reward remains intact despite some encouraging signs.
- Continued focus on bank transition and loan book diversification to weigh on earnings.
- Ujjivan: Upgraded to ‘Hold’ from ‘Reduce’; hiked price target to Rs 370 from Rs 329.
- 2018-19 a crucial transition year from both asset diversification and liabilities base building perspective.
- Equitas: Maintained ‘Buy’; cut price target to Rs 152 from Rs 159.
- Equitas is positioned to accelerate its balance sheet growth from here on.
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