A trader watches a quote screen minutes before the start of trading on the floor of the New York Stock Exchange. (Photographer: Daniel Acker/Bloomberg News.)

Stocks To Watch: Alkem Labs, Dalmia Bharat, Fortis, JSPL, UltraTech

Summary
  • Jindal Steel & Power launches QIP at a floor price of Rs 227.15 apiece.
  • Fortis to seek shareholders’ approval for RHT acquisition.
  • Dalmia Bharat unit provides performance bank guarantee of 10 percent for upfront payment to lenders in Binani Cement.
  • Transport Corp acquired a new ship to increase capacity in west coast.
  • Alkem Labs: U.S. FDA conducts surprise audit at drugmaker’s Daman plant

Stocks in Asia were poised for modest advances after a rally in crude oil buoyed U.S. equities. Japan is closed for a holiday.

The Singapore-traded SGX Nifty, an early indicator of NSE Nifty 50 Index’s performance in India, traded flat at 10,153 as of 6:55 a.m.

Here Are The Stocks To Watch Out For In Wednesday’s Trade

  • Jindal Steel opens QIP at a floor price of Rs 227.15 apiece.
  • Alkem Labs: U.S. FDA conducts surprise audit at drugmaker’s Daman plant
  • Amtek says Liberty’s resolution plan not yet approved by lenders.
  • TCS partners with Saudi Real Estate Refinance company.
  • Greenply Industries mulls demerger of MDF business. The board also approved expansion of Veneer Line at Gabon factory.
  • Fortis to seek shareholders’ approval for RHT acquisition.
  • Newgen Software released Mobile Medicare Enrolment solution for U.S. health plans.
  • Ashoka Buildcon declared lowest bidder for two projects worth Rs 447.51 crore.
  • Transport Corporation of India acquired one ship with capacity of 26,262 DWT for Rs 48.80 crore.
  • Dalmia Bharat unit provides performance bank guarantee of 10 percent for upfront payment to lenders in Binani Cement.
  • Mercator to sell vessel for $4.25 million to Best Oasis Ltd; will use proceeds to repay debt.
  • Manappuram Finance approved business plan for FY19.
  • Transport Corp acquired a new ship to increase capacity in west coast.

New Offerings

  • Mishra Dhatu Nigam IPO opens at an issue price of Rs 87-90 per share.
  • Hindustan Aeronautics IPO subscribed 0.99 times on final day.
  • Karda Construction IPO subscribed 1.42 times on final day.
  • Sandhar Technologies IPO continues on day 3. The issue is subscribed 0.4 times.

F&O Setup

  • Nifty March futures closed trading at 10,143.2, premium of 18.9 points from 28.8 points.
  • March series: Nifty open interest unchanged, Bank Nifty open interest down 5 percent.
  • India VIX ended at 15.6, down 1.3 percent.
  • Max open interest for March series at 10,500 call strike (open interest at 63.8 lakh, down 3 percent).
  • Max open interest for March series at 10,000 Put (open interest at 66 lakh, up 5 percent).

F&O Ban

  • In ban: Dewan Housing, HDIL, IDBI Bank, IFCI, Jindal Steel, JP Associates, Reliance Communications, SAIL.
  • New in ban: IFCI, Jindal Steel.
  • Out of ban: BEML.

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

Active Stock Futures

Bulk Deals

  • Jindal Cotex: LTS Investment Fund sold 3.86 lakh shares or 0.9 percent equity at Rs 7.1 each.
  • Intrasoft Technologies: Vora Financial services bought 86,329 shares or 0.6 percent equity at Rs 703 each.

IDFC Bank

  • Copthall Mauritius Investment sold 96.74 lakh shares or 0.6 percent equity at Rs 50 each.
  • Baobab Global Fund bought 96.74 lakh shares or 0.6 percent equity at Rs 50 each.

Sarveshwar Foods

  • India Max Investment Fund sold 4.09 lakh shares at Rs 70.5 each.
  • Krishen Bal bought 4.06 lakh shares at Rs 70.5 each.

Brokerage Radar

Credit Suisse on Emami

  • Maintained ‘Outperform’ with price target of Rs 1,260.
  • Distribution challenges being overcome.
  • Wholesale channel stabilised; E-way bill to be closely watched.
  • Margins not a major concern for now.
  • Focus on double-digit volume growth through a combination of existing and new products.

Credit Suisse on HDFC

  • Maintained ‘Outperform’ with price target of Rs 2,250.
  • Strong growth in individual segment.
  • Competition picking up in corporate segment.
  • RERA would lead to some consolidation of the smaller players.
  • Open to inorganic opportunities in housing segment.
  • Looking at opportunities in health insurance space within HDFC ERGO.

Macquarie on Indian Steel

  • Demand in China is just delayed, and not curtailed.
  • Domestic prices and demand remains robust.
  • Raw material weakness to partially offset steel price weakness.
  • Domestic fundamentals remain robust.
  • Steel producers to deliver $20-30/t QoQ margin expansion in current quarter.
  • Positive on both Tata Steel and JSW Steel post recent correction.
  • Tata Steel offers better risk-reward.

JPMorgan on Kotak Mahindra Bank

  • Maintained ‘Overweight’; raised price target to Rs 1,200 from Rs 1,100.
  • Bank in a strong position to leverage reduced competitive intensity in core banking.
  • Elevated valuations supported by strong growth momentum and resilient asset quality.
  • Bank's subsidiaries in a sweet spot.
  • Kotak Mahindra Bank one of top picks.

ICICI Securities on Dr. Reddy’s

  • Upgraded to ‘Add’ from ‘Hold’; cut price target to Rs 2,378 from Rs 2,487.
  • Several triggers to revive growth and margins over the next two fiscals.
  • US revenue run rate likely to bottom out in current fiscal.
  • Price erosion likely to remain in double digit in the next fiscal.
  • Several drivers in place to offset base business price erosion and drive U.S. sales.
  • Current valuations factor in all negatives.
  • Successful outcome of triggers may lead to valuation re-rating.

HDFC Securities on CDSL

  • Initiated ‘Buy’ with price target of Rs 425; implying a potential upside of 50 percent from the last regular trade.
  • Gem of a business that investor constructive on India in the long term must own.
  • Depository business is a proxy for capital market growth.
  • Limited scope for any other depository to be set up.
  • Diversified revenue stream with high component of annuity revenue.
  • Operates at healthy operating margin with embedded non-linearity.
  • CDSL gaining market share
  • Robust balance sheet and cash generation.
  • Pays healthy dividend; Payout could be higher.
  • Expect revenue, operating income and ent profit to compound at 22 percent, 28 percent and 20 percent respectively over the fiscal 2017-2020.
  • Operating margin to expand to 64 percent by March 2020, compared to 54.4 percent, clocked in the previous fiscal, led by fixed cost business model.

ICICI Direct on NGL Fine-Chem

  • Initiated ‘Buy’ with price target of Rs 465 – Rs 505.
  • After stagnation, capacity expansion to support future growth.
  • Likely adoption of dual source strategy to benefit Indian players.
  • Expect revenue, operating income and net profit to compound at 15 percent, 14 percent and 19 percent respectively over the fiscal 2017-2020.
  • Stock offers a compelling value proposition based on micro and macro parameters.

Media Reports

  • Arcelor Mittal likely to offer Rs 3,000 crore to Uttam Galva to settle dues (Financial Express).
  • IndiGo, Qatar Airways to amake a joint bid for Air India (Financial Express).
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