Indian equity benchmarks eased ahead of Reserve Bank of India’s monetary policy decision decision and as investors weighed a poll showing a tight election in Prime Minister Narendra Modi’s home state.
According to a poll by Bloomberg News, 41 of 46 economists polled expect the repo rate to remain unchanged at 6 percent, while a small minority expects another 25 basis point cut to 5.75 percent.
The S&P BSE Sensex fell 0.2 percent to 32,802 and the NSE Nifty 50 Index was little changed at 10,118.
Thirteen out of 19 sector gauges compiled by BSE ended lower led by the S&P BSE Power Index. On the other hand, the S&P BSE Bankex Index was the top sectoral gainer, up 0.38 percent.
Here Are The Stocks To Watch Out For In Wednesday’s Session
- Lanco Infra: Company to sell four renewable energy assets (Mint).
- Aurobindo Pharma: U.S. FDA approved Ranolazine Extended Release Oral Tablet.
- Bharat Financial: RBI allows foreign institutions to further buy shares
- Shilpa Medicare: Receives 10 observations from USFDA for its Telangana plant
- Indo National: To provide corporate guarantee of Rs 8.5 crore on behalf of subsidiary
- Punjab Chemicals: To consider raising funds at its board meeting on Dec. 8
- Atlas Cycles: Says lenders Bank of Baroda and Central Bank of India have downgraded the company’s debt to non-performing.
- Hatsun Agro: Pays Rs 2.07 crore to income tax authorities as per the settlement commission’s order.
- Reliance Communication: Says petition filed by Fortuna PR is misconceived
- IRB Infra: Acquires additional 2.40 lakh units of IRB Invit
- Byke Hospitality: Acquires three hotels in Shimla, Kovalam and Matheran
- Nifty Dec. Futures trading at 10,146.7, premium of 28.7 points versus 31.5 points
- Dec. Futures: Nifty open interest up 6 percent, Bank Nifty open interest up 3 percent
- India VIX closed one percent higher at 15
- Max open interest for Dec. series at 10,500 Call (open interest at 62.2 lakh, up 1 percent)
- Max open interest for Dec. series at 10,000 Put (open interest at 80.4 lakh)
No securities in ban list.
Active Stock Futures
- Cygnet Industries bought 17.85 lakh shares (1.6 percent) atRs 1295.50 each
- Camden Industries sold 17.85 lakh shares (1.6 percent) atRs 1295.50 each
- Karuna Rajan sold 95,659 shares (0.9 percent) atRs 232.58 each. Held 1.20 lakh shares (1.15 percent)
- Consolidated Infrastructure Co. sold 55,000 shares (0.5 percent) at Rs 233.16 each. Held 1.34 lakh shares (1.28 percent)
Mandhana Retail Ventures
- Mentor Capital bought 1.79 lakh shares (0.8 percent) at Rs 136.01 each
- Azarel fashions Pvt. Ltd. sold 1.78 lakh shares (0.8 percent) at Rs 136 each
5paisa Capital: Promoter Nirmal Jain bought 1.25 lakh shares (1 percent) at Rs 191.22 each.
Sical Logistics: Samyaktva Constructions bought 3.68 lakh shares (0.7 percent) at Rs 215.37 each.
C&C Constructions: Trupti Karani sold 2.22 lakh shares (0.9 percent) at Rs 81.74 each.
Earnings Reaction To Watch
Dish Tv (Q2, YoY)
- Revenue down 4 percent at Rs 749 crore.
- Net loss of Rs 16 crore from a profit of Rs 70 crore.
- Ebitda down 18 percent at Rs 216.5 crore.
- Margin at 28.9 percent versus 34 percent.
Lux Industries (Q2, YoY)
- Revenue down 15 percent at Rs 226 crore.
- Net profit down 23.5 percent at Rs 13 crore.
- Ebitda down 17 percent at Rs 29 crore.
- Margin at 12.8 percent versus 13.1 percent.
Manali Petrochemicals (Q2, YoY)
- Revenue up 7 percent at Rs 148 crore.
- Net profit down 16 percent at Rs 9.2 crore.
- Ebitda down 26 percent at Rs 14 crore.
- Margin at 9.5 percent versus 13.7 percent.
Windsor Machines (Q2, YoY)
- Revenue up 8 percent at Rs 86 crore.
- Net profit up 30 percent at Rs 7.8 crore.
- Ebitda up 18 percent at Rs 13 crore.
- Margin at 15.1 percent versus 13.8 percent.
Harrisons Malayalam (Q2, YoY)
- Revenue flat at Rs 92.5 crore.
- Net profit up 13 percent at Rs 87 crore.
- Ebitda down 27 percent at Rs 3.3 crore.
- Margin at 3.6 percent versus 4.9 percent.
The Byke Hospitality (Q2, YoY)
- Revenue down 45 percent at Rs 29.4 crore.
- Net profit down 10 percent at Rs 5.2 crore.
- Ebitda down 5 percent at Rs 11.3 crore.
- Margin at 38.4 percent versus 22.2 percent.
Plastiblends (Q2, YoY)
- Revenue up 12 percent at Rs 144 crore.
- Net profit down 62.5 percent at Rs 3 crore.
- Ebitda down 33 percent at Rs 10 crore.
- Margin at 6.9 percent versus 11.6 percent.
- Ador Welding
- Centum Electronics
- Kridhan Infra
Morgan Stanley on Aditya Birla Capital
- Initiated ‘Equal-weight’ rating with price target of Rs 185.
- Expect steady rise in profitability in lending and asset management.
- ABCL gives good exposure to rising financialisation in India.
- Expect net profit compound annual growth rate of 33 percent and 35 percent for NBFC and AMC respectively by March 2020.
- Positives: diversified loan book, low cost of funds and low cost of operations.
- Good long-term growth story but near-term valuation seems full.
- Higher rates and competition from PSU banks will likely remain an overhang.
- Would turn positive if there is strong pickup in growth and/or sustained increase in return ratios.
- Bull Case price target of Rs 330: Expect strong volume coupled with improvement in profitability.
CLSA on Bharat Forge
- Maintained ‘Buy’ with price target of Rs 905.
- Outlook for Bharat Forge’s exports improved.
- Demand pick-up in US trucks and industrial exports.
- Expect earnings per share to grow at a compound annual growth rate of 34 percent by March 2020.
- Valuations not cheap but should sustain.
- Tightening emission norms (BS-VI) is positive; Electrification is a long-term risk.
Jefferies on Housing Finance
- Housing Finance Companies to see steady loan growth.
- Affordable housing gaining traction, especially LIG/EWS.
- Positive on HFCs for medium term, but expect near term headwinds.
- Prefer asset financiers with strong growth and leverage to rural recovery.
- Prefer PNB Housing; Consumer Finance like Bajaj Finance and M&M Financials.
Citi on M&M
- Maintained ‘Buy’; raised price targer to Rs 1,700 from Rs 1,670.
- Farm equipment remains on a solid footing; But is overshadowed by UVs weak performance.
- Target price raised to adjust for stock prices of listed subsidiaries.
- M&M is trying to put together an EV business dealing with regulatory uncertainty and ensuring capex don’t rise.
Brokerages On Dish TV
- Maintained ‘Buy’; raised price target to Rs 108 from Rs 97.
- Concerned on slow recovery in ARPU/subscribers, but big merger synergies ahead.
- Management has reiterated net synergies of Rs 510 crore in the next financial year from merger.
- Expect Dish TV to deliver 10 percent Ebitda compound annual growth rate by March 2020 pre-merger.
- Full synergy realisation to drive further 16 percent upside.
- Maintained ‘Outperformer’; raised price target to Rs 95 from Rs 90.
- Incremental recovery in operating metrics.
- Management expects ARPU to improve in the current and next quarter, partly aided by GST.
- Outperformer rating due to share price correction, recovery in ARPU, improved earning visibility and merger with Videocon d2h.
- Maintained ‘Buy’; cut price target to Rs 102 from Rs 105.
- Positive on the back of digitisation, merger with Videocon d2h and inexpensive valuations.
- Materialization of synergy benefits post-merger is key near-term trigger.
- Favourable ruling from the court on license fee, would increase price target by Rs 15.
- Dalmia Bharat, Piramal Bain tie up for Binani Cement bid (Economic Times).
- Fitch drops Reliance Communications from coverage list (Economic Times).
- Idea - Vodafone merger likely much before September timeline (Economic Times).
- Sanofi to continue seeking Phase 3 wiaver for Dengue Vaccine (Economic Times).
- FMCG Funds best among Thematic Scheme in 2017 (Business Standard).
- Thyssenkrupp gets ultimatum on jobs, plants in Tata Merger (Financial Express).
- NLCT Mumbai Bench stays Arbitration Tribunal Order on Monnet Ispat (Financial Express).
- Rs 8450 crore sops, Regulatory Reforms to revive exports (Mint).
- Lanco Infra looks to sell four renewable energy assets (Mint).
- Trai to float consultation paper on television channels licenses (Mint).
- Electric reforms get a leg-up in UP; follow up actions key (Mint).
- Wadhwa set to raise Rs 100 crore from Piramal (Mint).
- Bharat Forge in expansion mode; to invest Rs 700 crore in India (Mint).