All You Need To Know Going Into Trade On Feb. 8

Asian stocks pushed higher Thursday, while U.S. equity-index futures slipped as investors assessed the implications of the recent market turmoil that has elevated volatility.

The Singapore-traded SGX Nifty, an early indicator of NSE Nifty 50 Index’s performance in India, rose 0.6 percent to 10,518 as of 7:00 a.m.

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DayBreak

Here’s a quick look at all that could influence equities on Thursday.

Global Cues

• U.S. stocks remained on unsteady footing as the bout of volatility that’s gripped global financial markets persisted amid signs that the rise in Treasury yields has yet to run its course.

• The Cboe Volatility Index eased back from levels last seen in August 2015, at 26.84 it remains about 40 percent above its average since 1990.

Asian Cues

• Japan’s Topix index rose 1.1 percent and the Nikkei 225 Stock Average added 1 percent.
• Australia’s S&P/ASX 200 Index fell 0.2 percent. South Korea’s Kospi index climbed 0.9 percent.
• Futures on Hong Kong’s Hang Seng Index gained 1.8 percent.
• S&P 500 futures contracts fell 0.3 percent. The cash equity gauge fell 0.5 percent Wednesday, erasing gains of as much as 1.2 percent.

Commodity Cues

• The Bloomberg Commodity Index fell 1.2 percent, its biggest tumble in 12 weeks.
• West Texas Intermediate crude was little changed at $61.69 a barrel after falling 2.6 percent.
• Gold fell 0.2 percent to $1,315.49 an ounce.

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

• The U.K.’s monetary policy decision Thursday. The Bank of England may see Governor Mark Carney emphasize that continuing appreciation of the pound, which has strengthened almost 3 percent since the beginning of 2018, would help to contain inflation. This would stand in sharp contrast to the Reserve Bank of New Zealand which earlier Thursday said it expects its exchange rate to ease.
• Earnings season continues with reports from Philip Morris, L’Oreal and Twitter.

Indian ADRs

Monetary Policy Review

India’s Monetary Policy Committee today kept interest rates unchanged and maintained a neutral stance, even as it raised its inflation forecasts and reiterated a commitment to maintaining the headline inflation at close to 4 percent.

The MPC, however, highlighted a number of upside risks to inflation, suggesting that a rate hike in the next financial year is now a real possibility. Five of the six MPC members voted for a status quo on rates. Michael Patra, executive director at the Reserve Bank of India, voted in favour of a 25-basis-point hike.

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• MPC Set To Hike Rates Soon? Unlikely, Say Economists
• RBI Looks To ‘Harmonise’ MCLR With Base Rate

Earnings To Watch

• ABB India
• ACC
• BHEL
• Bharat Forge
• Cadila Healthcare
• CESC
• Dr Lal Path Labs
• Glenmark Pharmaceuticals
• Granules India
• Manappuram Finance
• Page Industries
• Parag Milk Foods
• Petronet LNG
• Reliance Capital
• SAIL
• Torrent Pharmaceuticals

Earnings After Market Hours

Aurobindo Pharma Q3 (YoY)

• Revenue up 11 percent at Rs 4,336 crore
• Net profit up 3 percent at Rs 595 crore
• EBITDA up 15 percent at Rs 1,025.5 crore
• Margin at 23.7 percent versus 22.9 percent

Prestige Estates Q3

• Revenue up 3 percent at Rs 1272 crore vs Rs 1234 crore
• Net profit up 33 percent at Rs 89 crore vs Rs 67 crore
• EBITDA up 6.6 percent at Rs 254 crore vs Rs 238.6 crore
• Margins at 20 percent vs 19.3 percent

IGL Q3 (QoQ)

• Revenue up 5.1 percent at Rs 1,184 crore
• Net profit down 1.7 percent at Rs 166 crore
• EBITDA down 6.6 percent at Rs 263 crore
• Margin at 22.2 percent versus 25 percent

Hexaware Q3 (QoQ)

• Revenue up 1 percent at Rs 1,005 crore
• Net profit down 15 percent at Rs 121 crore
• EBIT down 8 percent at Rs 144 crore
• Margin at 14.3 percent versus 15.8 percent

GE T&D India Ltd. Q3

• Margin at 3.5 percent versus 6.4 percent
• EBITDA down 32.5 percent at Rs 50.4 crore versus Rs 74.7 crore
• Revenue up 23.5 percent at Rs 1,438.5 crore versus Rs 1,165.1 crore
• Net profit 60.5 percent at Rs 71.1 crore versus Rs 44.3 crore

Uflex Ltd. Q3

• Consolidated margin at 11.6 percent versus 14 percent
• Consolidated EBITDA 7.2 percent at Rs 194.43 crore versus Rs 209.6 crore
• Consolidated revenue 6 percent at Rs 1,674.4 crore versus Rs 1,580.8 crore
• Consolidated net profit 29.5 percent at Rs 52 crore versus Rs 73.8 crore

Irb Infra Q3 (YoY)

• Revenue down 8 percent at Rs 1,296.2 crore
• Net profit up 12.5 percent at Rs 207.3 crore
• EBITDA down 15 percent at Rs 630 crore
• Margin at 48.6 percent versus 52.7 percent

Reliance Home Finance Q3 (YoY)

• Revenue up 54.4 percent at Rs 403 crore
• Net profit up 100 percent at Rs 46 crore

Alphageo Q3 (YoY)

• Revenue up 28 percent at Rs 104 crore
• Net profit up 17 percent at Rs 14 crore
• EBITDA up 15 percent at Rs 31 crore
• Margin at 29.8 percent versus 33.3 percent

Firstsource solutions Q3 (QoQ)

• Revenue up 2 percent at Rs 89 crore
• Net profit up 43 percent at Rs 10 crore
• EBIT up 11 percent at Rs 10 crore
• Margin at 11.2 percent versus 10.3 percent

Gati Q3 (YoY)

• Revenue up 5.5 percent at Rs 448.5 crore
• Net profit down 45.5 percent at Rs 3 crore
• EBITDA down 8 percent at Rs 23.5 crore
• Margin at 5.2 percent versus 6 percent

Dixon Technologies Q3 (YoY)

• Revenue up 0.3 percent at Rs 678 crore
• Net profit up 25 percent at Rs 15 crore
• EBITDA up 6 percent at Rs 27 crore
• Margin at 4 percent versus 3.8 percent

SRF Ltd Q3 (YoY)

• Revenue up 23 percent at Rs 1,397 crore
• Net profit up 21 percent at Rs 131 crore
• EBITDA up 11 percent at Rs 253 crore
• Margin at 18.1 percent versus 20.1 percent

Excel Industries Q3 (YoY)

• Revenue up 60 percent at Rs 147 crore
• Net profit up at Rs 19.6 crore
• EBITDA up at Rs 32.5 crore
• Margin at 22.1 percent versus 6.5 percent

Kalpataru Power Transmission Q3 (YoY)

• Revenue up 25.5 percent at Rs 1,417 crore
• Net profit up 31.6 percent at Rs 75 crore
• EBITDA up 27 percent at Rs 152 crore
• Margin at 10.7 percent versus 10.6 percent

Monte Carlo Q3 (YoY)

• Revenue up 24 percent at Rs 356 crore
• Net profit up 37 percent at Rs 48 crore
• EBITDA up 50 percent at Rs 79.5 crore
• Margin at 22.3 percent versus 18.4 percent

Ramco Systems Q3 (QoQ)

• Revenue up 9 percent at Rs 125 crore
• Net profit down 38.5 percent at Rs 4 crore
• EBIT down 50 percent at Rs 6 crore
• Margin at 4.8 percent versus 10.4 percent

Stocks To Watch

• Shriram Transport transferred 1.66 crore shares of Shriram Automall India worth Rs 156.37 crore to MXC Solutions India
• Mahindra, Piramal express interest in buying Sahara's Aamby Valley
• Karnataka Bank raised interest rates on domestic term deposits
• Southern Petrochemicals board approved proposal of TFL for conversion of unsecured loans and outstanding dues into equity
• Gitanjali Gems said managing director Mehul Chooksi named among accused in Rs 280 crore cheating case
• 3i Infotech alloted 1.46 crore shares and 2.56 crore non-convertible class B preferential shares to Oriental Bank of Commerce pursuant to scheme of restructuring
• FDC Ltd. board approved buyback of 34.30 lakh shares at Rs 350 apiece. Promoters will participate
• Dilip Buildcon incorporated a new SPV for the rehabilitation and upgradation of National Highway 5
• Piramal Enterprises said Bain capital will acquire 50 percent stake in subsidiary India Resurgence Asset Management Business
• Union Bank of India to allot shares worth Rs 4,524 crore to the government on a preferential basis

Bulk Deals

Shankara Building Products

• Amansa Holding Pvt Ltd bought 3.97 lakh shares (1.7 percent) at Rs 1,675 each
• Smaller Cap World Fund Inc sold 4.17 lakh shares (1.8 percent) at Rs 1,675 each

Trading Tweaks

• Omkar Speciality Chemicals circuit filter revised to 10 percent
• BharatElectronics, Savita Oil Technologies Special Tubes ex-date to determine buyback eligibility
• Pidilite last trading day to determine buyback eligibility
• Indiabulls Ventures last trading day before going ex-rights

New Listing

• Galaxy Surfactants Ltd. to list on exchanges. The issue was subscribed 19.9 times.

Who’s Meeting Whom?

• JMC Projects to meet White Oak Capital on Feb. 8
• Sharda Cropchem to meet Reliance AM and Mahindra AM on Feb. 8
• Narayana Hrudalaya to meet funds in Singapore and HK on Feb. 7-9

Insider Trades

• Kedar Vaze promoter of S H Kelkar sold 3.5 lakh shares on Feb. 5-6
• Kinetic Engineering promoter bought 7 lakh shares on Feb. 5
• Alembic Pharma promoter bought 13,000 shares on Feb. 5-6

Rupee

• Rupee closed at 64.29/$ on Wednesday from 64.25/$ on Tuesday.

Top Gainers And Losers

Index Trends

F&O Cues

• Nifty February futures trade at 10,465, discount of 10 points from a premium of 15 point
• February series: Nifty open interest unchanged; Bank Nifty open interest up 8 percent
• India VIX ended at 19.4, down 2.7 percent
• Max open interest for February series at 11,500 call strike (open interest at 57 lakh, down 1 percent)
• Max open interest for February series at 10,000 put (open interest at 56.7 lakh, up 14 percent)

F&O Ban

• In ban: Fortis Healthcare, GMR Infrastructure, HDIL, Jain Irrigation
• New in ban: GMR Infra

Only intraday positions can be taken in stocks which are in F&O ban. In case of rollover of these intraday positions, there is a penalty.

Put-Call Ratio

• Nifty PCR at 1 from 1.13
• Nifty Bank PCR at 0.7 from 0.81

Stocks Seeing High Open Interest Change

Fund Flows

Brokerage Radar

Nomura on Eicher

• Maintain neutral with target price of Rs 33,049
• EBITDA marginally ahead of estimates in the third quarter
• Expansion of standalone gross margins is a positive
• Sharp jump in other expenses led by new product launch
• Expect Royal Enfield volumes growth to normalise to 15 percent/12 percent in the next fiscal

Jefferies on Eicher

• Maintain hold; cut target price to Rs 31,227 from Rs 31,447
• In-line for Royal Enfield in the third quarter
• VECV delivered strong performance
• Better gross margin, helped partly by inventory build-up
• Believe Royal Enfield is going through a reset
• Seeing waiting periods disappear, growth moderates and margins stabilize

Deutsche Bank on Indraprastha Gas

• Maintain buy with target price of Rs 320
• Marginally below estimates in the December-ended quarter
• Strong volume growth offsets weaker margin impact
• IGL on track to deliver robust earnings growth
• IGL looks well placed to benefit from expansion in new areas

Angel Broking on Elantas Beck India

• Initiate Buy with target price of Rs 2,500
• Market leader in liquid insulation used in electrical equipment
• Liquid insulation forms small but critical part
• Demand from user industries likely to be robust
• Deleveraged company generates healthy free cash flow
• Has liquid investments worth more than Rs 128 crore
• Company shares this wealth in every 2-3 years in form of rich dividends
• Expect company to soon announce a lumpy dividend
• Calendar year 2017 to be subdued due to GST woes and poor off take
• Demand to pick up from the present calendar year: Earnings to grow at a compounded annual growth rate of 17 percent over three calendar years up to 2020
• Current valuations looks attractive considering growth potential and high return ratios

Prabhudas Lilladher on Indraprastha Gas

• Maintain Buy; Cut target price to Rs 333 from Rs 342
• Net profit and EBITDA lower than estimates in the September to December quarter
• Higher gas costs and other expenses drag margins
• CNG, PNG volume traction remains strong
• IGL remains a play on rising pollution concerns
• Natural gas if included in GST will further boost gas demand

Macquarie on Cipla

• Upgrade to Outperform from Neutral; Raised target price to Rs 670 from Rs 632
• EBITDA was tad above estimate in the third quarter
• Impairment charge in Invagen acquisition value was a key negative
• India, Europe and SA shine; U.S. growth yet to pick up
• Expect U.S. sales to pick up starting in the fourth quarter
• US to deliver decent 12 percent revenue CAGR over financial years 2017 to 2020
• Cipla is best placed amongst large-cap pharma stocks

Credit Suisse on Cipla

• Maintain Outperform with a target price of Rs 700
• Beat EBITDA estimates in the third quarter due to strong India growth better gross margins and cost control
• Ex-U.S.: Strong growth in India and Europe
• Margin expansion to continue as the second quarter was partially benefitted from high margin launches
• Benefit of key U.S. launches to be visible in the fourth quarter

Jefferies on Voltas

• Maintain Buy with a target price of Rs 660
• Strong operational beat; Profits came in-line in the December-ended quarter
• Cooling products surprised on both revenue and margins
• MEP profitability surprises
• Cooling products maintain market leadership at 23.7 percent share

Macquarie on Hexaware

• Maintain Outperform; Raised target price to Rs 444 from Rs 380
• Revenue were marginally better in the last quarter of the previous calendar year
• New deal wins remain solid; Validates articulated strategy
• Guidance may be conservative
• Expect Hexaware to post industry leading dollar revenue growth of 12.4 percent in the current calendar year
• Aiming to reduce U.S. revenues to 70 percent in medium term
• Continue to rate L&T Infotech and Hexaware as top midcap picks in Indian IT space

IDFC Securities on Spicejet

• Maintain Outperformer; Raised target price to Rs 181
• Stellar earnings led by higher volumes and better yields in the third quarter
• Capacity additions lagging demand; Load factors continue to remain robust
• Continues to reap benefits of its increased non-metro/regional focus
• Expect impact of recent surge in crude prices to be passed on in tariffs by the first quarter of the next fiscal
• With strong cash generation balance sheet to strengthen further

Elara Capital on Spicejet

• Maintain Buy; Raised target price to Rs 203 from Rs 188
• Strong pricing power driving earnings
• Strong passenger volume growth; Strong yield growth
• Spicejet is top pick among aviation space
• Company to benefit from regional market growth