The Bombay Stock Exchange (BSE), right, stands on Dalal street in Mumbai (Photographer: Adeel Halim/Bloomberg)

All You Need To Know Going Into Trade On Dec. 11

Asian stocks pared an earlier advance in subdued trading as investors deferred placing bets following the recent run-up to record highs and ahead of Federal Reserve meeting this week.

The Singapore-traded SGX Nifty, an early indicator of NSE Nifty 50 Index’s performance in India, rose 0.2 percent at 10,309.50 as of 6:40 a.m.

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Day Break

Global Cues

  • U.S. stocks climbed to records as the latest jobs report bolstered optimism in the world’s largest economy, continuing equity rallies that took hold in Asia and Europe. The dollar posted its best week this year.
  • The S&P 500 Index and Dow Jones Industrial Average closed at all-time highs in light volume after data showed hiring increased by more than forecast in November and the unemployment rate held at a 17-year low.
  • The dollar briefly edged lower as investors assessed tepid wage growth that missed estimates, then resumed its fifth consecutive gain.

Europe Check

  • The pound reversed initial gains as the U.K. and the European Union struck a deal to unlock divorce negotiations, while equities in Europe jumped.
  • The Stoxx Europe 600 Index climbed 0.7 percent to a one-month high.
  • The U.K.’s FTSE 100 Index gained 1 percent.

Asian Cues

  • The Topix index added 0.2 percent. The Nikkei 225 Stock Average gained 0.2 percent.
  • Australia’s S&P/ASX 200 Index fluctuated.
  • South Korea’s Kospi index rose less than 0.1 percent.
  • Futures on the S&P 500 rose less than 0.1 percent. The underlying gauge gained 0.6 percent on Friday.
  • Futures on Hong Kong’s Hang Seng Index advanced 0.1 percent.
  • The MSCI Asia Pacific Index was up 0.1 percent.

Here are some key events scheduled for the remainder of the week:

  • Fed policy makers are projected to raise the target range for their benchmark interest rate against a backdrop of continuing robust U.S. economic conditions, a vibrant labor market and forecasts for inflation to pick up.
  • The European Central Bank, the Bank of England and the Swiss National Bank also set monetary policy.
  • Among top U.S. economic reports next week are consumer inflation and retail sales for December.
  • European lawmakers continue to debate Brexit and weigh moves on the next step, while North America Free Trade Agreement (NAFTA) negotiators meet again.

Commodity Update

  • West Texas Intermediate crude fell 0.5 percent to $57.06 a barrel.
  • Brent crude trades lower at $63.03 per barrel, down 0.6 percent.
  • Gold was steady at $1,248.82 an ounce.
  • Sugar ends near six-week low at 14.05 cents per pound; down 1.8 percent.

Shanghai Exchange

  • Steel snaps three-day losing streak; up 1.9 percent.
  • Aluminium trades higher; up 0.3 percent.
  • Zinc trades higher; up 0.6 percent.
  • Copper trades flat.
  • Rubber trades higher after losing for four trading session; up 0.4 percent.

Indian ADRs

All You Need To Know Going Into Trade On Dec. 11

Earnings To Watch

  • Aarvee Denims
  • Andrew Yule
  • APL Apollo Tubes
  • ARSS Infra
  • Associated Alcohol
  • BF Utilities
  • Centrum Capital
  • Colgate Palmolive
  • Lasa Supergenerics
  • Mawana Sugars
  • MT Educare
  • Nandan Denim
  • PBM Polytex
  • Repro India
  • V2 Retail

Earnings Reaction To Watch

Omax Auto (Q2 YoY)

  • Revenue up 11 percent at Rs 289 crore.
  • Net profit up 230 percent at Rs 3.3 crore.
  • Ebitda up 43 percent at Rs 14.6 crore.
  • Margin at 5.1 percent versus 3.9 percent.

Global Vectra Helicorp (Q2 YoY)

  • Revenue up 11 percent at Rs 99 crore.
  • Net profit down 20 percent at Rs 3.6 crore.
  • Ebitda down 18.5 percent at Rs 15.4 crore.
  • Margin at 15.6 percent versus 21.2 percent.

KDDL (Q2 YoY)

  • Revenue down 15 percent at Rs 100.7 crore.
  • Net profit up 200 percent at Rs 1.5 crore.
  • Ebitda up 8.5 percent at Rs 7.05 crore.
  • Margin at 7.0 percent versus 5.5 percent.

Aegis Logistics (Q2 YoY)

  • Revenue up 84 percent at Rs 1,241 crore.
  • Net profit up 108 percent at Rs 52 crore.
  • Ebitda up 46 percent at Rs 67 crore.
  • Margin at 5.4 percent versus 6.8 percent.

Federal Mogul (Q2 YoY)

  • Revenues up 4 percent at Rs 329 crore.
  • Net profit up 8 percent at Rs 22.8 crore.
  • Ebitda up 1 percent at Rs 50 crore.
  • Margin at 15.2 percent versus 15.7 percent.

Kellton Tech Solutions (Q2 YoY)

  • Revenue up 21.8 percent at Rs 184 crore.
  • Net Profit up 11.1 percent at Rs 14.6 crore.
  • Ebitda up 28.8 percent at Rs 26.7 crore.
  • Margin at 14.6 percent versus 13.8 percent.

Aurionpro Solutions (Q2 YoY)

  • Revenue up 1.9 percent at Rs 168.7 crore.
  • Net Profit up 497 percent at Rs 13.7 crore.
  • Ebitda up 110 percent at Rs 29.8 crore.
  • Margin at 17.7 percent versus 8.6 percent.

Soril Holdings and Ventures (Q2 YoY)

  • Revenue down 11.5 percent at Rs 42.7 crore.
  • Net loss of Rs 18.8 crore versus net loss of 3.7 crore.
  • Ebitda loss of Rs 0.6 crore versus Ebitda profit of Rs 10.2 crore.
  • Margin at -1.4 percent versus 21.1 percent.

Sharda Motor Industries (Q2 YoY)

  • Revenue up 17.1 percent at Rs 305 crore.
  • Net Profit up 62.7 percent at Rs 20.3 crore.
  • Ebitda up 5.7 percent at Rs 36.4 crore.
  • Margin at 12.0 percent versus 13.2 percent.

IFGL Refractories (Q2 YoY)

  • Revenue up 3.3 percent at Rs 199 crore.
  • Net Profit down 46.8 percent at Rs 9.4 crore.
  • Ebitda down 9.0 percent at Rs 26.8 crore.
  • Margin at 13.4 percent versus 15.3 percent.

Stocks To Watch

  • Baring looks to sell up to 15 percent in Hexaware; PE firm may opt for multiple blocks deals (ET).
  • Ultratech Cement to set up 3.5 mtpa integrated cement plant at Pali, Rajasthan with investment of Rs 1,850 crore.
  • Delhi Govt cancels license of Max Hospitals Shalimar Bagh.
  • Precision Camshaft to provide corporate guarantee of Rs 149 crore to Bank of Baroda on behalf of subsidiary.
  • Sadbhav Infra signs maintenance contract worth Rs 150 crore with subsidiary.
  • KDDL to invest Rs 20 crore in Ethos.
  • Jyothy Labs to borrow Rs 400 crore and provide corporate guarantee of Rs 60 crore to one of its subsidiary.
  • Tata Chemicals receives NCLT nod for sale of Ure and fertilizer business to Yara Fertilizers India.
  • Punjab Chemicals to raise Rs 150 crore via equity/debt.
  • IL&FS Engineering wins 216 crore pipeline laying contract from GAIL.
  • Power Grid has entered into loan agreement with Asian Infrastructure Investment Bank for $100 million.
  • Govt to sell 67.50 lakh shares in NBCC at a discounted price of Rs 156.12 via OFS to employee. OFS to remain open from Dec. 28 - Jan. 05.
  • CBI books Apollo Pharmacy, a unit of Apollo Hospitals, in a case of cheating and corruption. (PTI)

Bulk Deals

  • Blue Star: SAIF India IV FII Holdings sold 17.4 lakh shares or 1.82 percent equity at Rs 800 each.
  • Rama Steel Tubes: Bharti AXA Life Insurance bought 1 lakh shares or 0.6 percent equity at Rs 185 each.
  • Indoco Remedies: FS INV ICVI Stewart Investors Asia Pacific Fund sold 10 lakh shares or 1.1 percent equity at Rs 266.04 each.
  • Sadbhav Infra: Xander Investment Holding XVII sold 35.89 lakh shares or 1 percent equity at Rs 133.19 each.
  • Religare Enterprises: Yes Bank sold 19 lakh shares or 1.1 percent equity at Rs 60.8 each
  • Websol Energy System: India Max Investment Fund sold 7.95 lakh shares or 3.2 percent equity at Rs 100.33 each.
  • Pincon Spirits: Lively Equipment’s Suppliers sold 2.25 lakh shares or 0.5 percent at Rs 32.41 each.
  • Ruchi Soya: Cresta Fund sold 36.91lakh shares or 1.1 percent equity at Rs 19.42 each.

Shilpi Cables

  • Swiss Finance Corporation (Mauritius) Ltd sold 16.48 lakh shares or 1.5 percent equity at Rs 13 each.
  • UBS Principal Capital Asia bought 16.48 lakh shares or 1.5 percent equity at Rs 13 each.

Who’s Meeting Whom?

  • Matrimony to HDFC Mutual Fund, IDFC, Credit Suisse, ICICI Securities and others on Dec. 11 - 12.
  • Prabhat Dairy to meet DSP Blackrock MF, Kotak Mutual Fund, Birla MF, SBI Life Insurance and others on Dec. 11.
  • Seya Industries to meet Tata Mutual Fund, Axis Mutual Fund, Max Life and others on Dec. 12.
  • Tata Motors to meet DSP Merrill Lynch and Credit Suisse on Dec. 12 - 13.

Rupee

  • Rupee ends at 64.46/$ on Friday versus 64.57/$ on Thursday.

IPO

  • Future Supply Chain Solutions IPO subscribed 7.6 times on final day

Index Trends

All You Need To Know Going Into Trade On Dec. 11

Top Gainers And Losers

All You Need To Know Going Into Trade On Dec. 11

F&O Cues

  • Nifty December Futures trading at 10,291.6, premium of 26 points versus 37 points.
  • December Futures: Nifty OI up 3 percent , Bank Nifty OI down 12 percent.
  • India VIX at 13.6, down 4.2 percent.
  • Max OI for Dec series at 10,500 Call, OI at 56.2 lakhs, OI down 9 percent.
  • Max OI for Dec series at 10,000 Put, OI at 86.8 lakh, OI up 1 percent.

F&O Ban

  • In Ban: HDIL, IRB Infra, Jet Airways, Jain Irrigation, Jaiprakash Associates and JSW Energy.
  • New In Ban: Jaiprakash Associates and JSW Energy.
  • Out of Ban: None

Alert: Only intraday positions can be taken in stocks which are in F&O ban, incase of rollover of these intraday positions there is a penalty

Put-Call Ratio

  • Nifty PCR at 1.26 versus 0.91.
  • Nifty Bank PCR at 1.46 versus 1.17.

Stocks Seeing High Open Interest Change

All You Need To Know Going Into Trade On Dec. 11

Fund Flows

All You Need To Know Going Into Trade On Dec. 11

Brokerage Radar

ICICI Direct on Narayana Hrudayalaya

  • Initiated ‘Buy’ with price target of Rs 340.
  • Blended model of affordability and high-quality services.
  • Government drive on affordability favours company’s cost efficient, affordable model.
  • Improvement in case mix to boost average realisation per operating bed.
  • NH is well poised to thrive in the domestic healthcare delivery.
  • Expect return on capital employed to improve to 19 percent by March 2020, compared to 12.5 percent clocked in the previous financial year.
  • Expect revenue and net profit to grow at a compounded rate of 17 percent and 34 percent by March 2020.

Edelweiss Investment on GNA Axles

  • Initiated ‘Buy’ with price target of Rs 455.
  • Strong presence in exports and domestic market provides competitive edge.
  • Cost reduction and new initiative to fuel the rise in topline and bottomline.
  • Expect strong growth momentum in North America heavy truck market to drive exports.
  • Healthy domestic demand scenario in M&HCV and OH to drive domestic business.
  • Positives: healthy order book, focus on productivity improvement and limited capex.
  • Triggers: healthy CV and tractor demand, cost reduction measure and plans to enter high realization SUV and LCV segment.
  • Bull Case price target of Rs 505.

HSBC on Motherson Sumi

  • Maintained ‘Buy’; raised price target to Rs 425 from Rs 376.
  • Increased focus on innovation and integration.
  • Expect innovation and cross selling to support business growth.
  • Remain positive as it is well placed to benefit from increasing role of auto component suppliers.
  • Innovative products on camera based technologies positions it for higher long-term growth.
  • Recent fund raising to help for multiple acquisitions to achieve its 2020 goal.

Jefferies on Reliance Industries

  • Downgraded to ‘Underperform’ from ‘Hold’; raised price target to Rs 790 from Rs 626.
  • Ebitda may double to $20 billion by March 2023, much of that appears priced in.
  • Expect refining margins to ease from the current fiscal highs.
  • Capex to stay elevated led by telecom and E&P.
  • Telecom ramp-up may be bumpier as ARPU/subscribers may not rise together.
  • Return ratios to remain modest and net debt higher.
  • Valuations are rich; Appears to have brushed off risks.
  • Stiff hurdle for Reliance to outperform from here on.

Axis Capital on Tech Mahindra

  • Maintained ‘Buy’; raised price target to Rs 605 from Rs 550.
  • Management betting on integrated digital experience, interconnectivity through IoT, software transformation and network of the future.
  • Financial performance bottomed out in the fourth quarter of previous fiscl.
  • Expect revenue trajectory to witness slow and steady recovery.
  • Margin improvement to drive earnings momentum over next four quarters.
  • Expect $ revenue and net profit to grow at a compounded rate of 8 percent and 11 percent respectively by March 2020.

IDFC Securities on Jet Airways

  • Maintained ‘Underperformer’; raised price target to Rs 666.
  • Better yields on domestic routes.
  • Higher fuel cost and lower traffic/yields on Gulf routes.
  • Downgraded operating income for the current financial year due to forex loss; Upgraded net profit for the current and the next financial year due to lower finance cost.
  • Expect tepid fleet additions to restrict Jet’s growth by March 2019.
  • High leverage and cash generation in the current and next financial year to fall short of scheduled debt repayments.

Edelweiss on Jet Airways

  • Upgraded to ‘Buy’ from ‘Hold’; Raised price target to Rs 822 from Rs 548.
  • Confident on strategic measures initiated by the new CEO to turnaround stressed financials.
  • Focusing on sustaining growth via cost rationalisation and balance sheet improvement.
  • Renewed focus on domestic market by adding 15 percent fuel‐efficient B737‐Max.
  • Enhanced code share to lead to market share gain on international routes.
  • Expect operational efficiencies to improve from the next financial year.

Morgan Stanley on Maruti Suzuki

  • Maintained ‘Overweight’; raised price target to Rs 10,563 from Rs 9,102.
  • Maruti is one of the most profitable car OEMs globally.
  • End-market opportunity and superior return on capital employed justify premium valuation.
  • Maruti a key beneficiary of coming turn in demand.
  • Suzuki-Toyota alliance to help set Maruti up for electric vehicles.
  • Expect earnings per share to grow at a compounded rate of 22 percent by March 2020.
  • Bull case price target of Rs 14,400.