A bronze bull statue stands at the entrance to the Bombay Stock Exchange (BSE) building in Mumbai, India. (Photographer: Dhiraj Singh/Bloomberg)

Sensex Surges 470 Points Led By Banks, Recoups Friday’s Losses

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Closing Bell

Indian equity benchmarks rebounded from Friday's losses led by HDFC twins, ICICI Bank and State Bank of India.

The S&P BSE Sensex rose 1.4 percent or 470 points to 33,066 and the NSE Nifty 50 index surged 1.3 percent or 133 points to 10,131.

Today’s recovery was led by short covering rally and these kinds of rallies are an opportunity to reduce positions.
AK Prabhakar, head of research, IDBI Capital

Sixteen out of 19 sector gauges compiled by BSE ended higher led by the S&P BSE Bankex index's 2.3 percent surge. On the flipside, the S&P BSE Information Technology index was the top sectoral loser, down 0.68 percent.

Mid- and small-cap shares also ended higher. The S&P BSE MidCap index advanced 1.2 percent and the S&P BSE SmallCap index gained 0.7 percent.

BQ Live

Block Deal Alert

  • Carborundum Universal has 20 lakh shares change hands in a block on BSE. Stock up 0.15 percent at Rs 337.50.

Buyers and sellers were not immediately known

Source: Bloomberg

Fab Four Stocks of The Day

  • Cadila Healthcare: The Ahmedabad-based drug maker rose as much as 5.3 percent to Rs 390 after it received final approval from the U.S. drug regulator for Metoprlol Succinate extended release tablets used in treatment of heart failure, high blood pressure and chest pain. Meanwhile, CLSA has upgraded the stock to ‘Buy’ from ‘Underperform’ and raised its target price to Rs 450 from Rs 440.
  • MMTC: The Delhi-based government-owned trading corporation rose as much as 10 percent after Commerce and Industry Minister Suresh Prabhu said that merger of STC and MMTC is on cards and the matter is under process, news agency Press trust of India reported.
  • Adani Enterprises: The Gujarat-based coal mining, cargo handling and power generation company rose as much as 3 percent, the most since March 21, to Rs 157 after its subsidiary Talabira Mining signed a coal mining pact with NLC India. The project is expected to generate revenue of Rs 12,200 crore, Adani Enterprises said in an exchange filing.
  • Jubilant FoodWorks: The Noida-based operator of Domino's Pizza and Dunkin' Donuts rose for sixth straight day. The stock in today's trade gained as much as 3.14 percent to hit record high of Rs 2,348 amid heavy volumes. Trading volume was 2.5 times its 20-day average for this time of the day.

Media Stocks See Buying Interest In Last Hour Of Trade

Shares of media companies were witnessing good buying interest in the last hour of trade. Gauge of media stocks on the National Stock Exchange — Nifty Media index rose 3.4 percent led by Den Networks, Network 18 Media and Hathway Cable and Datacom.

Market Check

  • Indian equity benchmarks staged a sharp upmove led by strong gains in banking shares.
  • The S&P BSE Sensex rose 0.9 percent or 311 points to 32,906 and the NSE Nifty 50 index gained 0.7 percent or 76 points to 10,074.
  • All sector gauges barring the Nifty IT index were trading higher led by the Nifty PSU Bank index's 3.7 percent surge. Meanwhile, the Nifty Bank index also rose 1.6 percent.

Top Sensex gainers

  • Yes Bank up 4 percent
  • State Bank of India up 3.9 percent
  • Mahindra & Mahindra up 2.1 percent
  • HDFC up 2 percent
  • Hindustan Unilever up 1.6 percent

Top Sensex losers

  • Wipro down 4 percent
  • Infosys down 1.1 percent
  • Tata Motors DVR down 0.7 percent
  • Tata Motors down 107 percent
  • TCS down 0.2 percent

European Shares Rise

A rebound in U.S. equity futures Monday offered some hope of stabilization after last week’s rout, with shares in Europe and Asia also rising as investor fears of an escalation of trade tensions began to ease.

Telecommunication firm and carmakers were the biggest gainers in European equities as futures on the S&P 500 Index and the Nasdaq pointed to a higher opening and Asian shares shook off earlier losses.

Adani Enterprises Gains On Signing Coal Mining Pact With NLC

Shares of the Gujarat-based coal mining, cargo handling and power generation company rose as much as 3 percent, the most since March 21, to Rs 157 after its subsidiary Talabira Mining signed a coal mining pact with NLC India. The project is expected to generate revenue of Rs 12,200 crore, Adani Enterprises said in an exchange filing.

IPO Market Update

ICICI Securities' Rs 4,017-crore initial public offer was subscribed 68 percent as of 1:00 p.m. on final day of subscription.

  • Portion reserved for qualified institutional buyers (QIB) was subscribed 99 percent.
  • Portion reserved for non-institutional bidders was subscribed 23 percent.
  • Retail portion was subscribed 62 percent.
  • Portion reserved for shareholders was subscribed 26 percent.

Source: Company's PR

Stocks Moving On Heavy Volumes

  • Gulf Oil Lubricants: The lubricating oil and grease maker fell 0.3 percent to Rs 900. Trading volume was 13.9 times its 20-day average.
  • Unichem Labs: The Mumbai-based drug maker fell as much as 11.65 percent, the most in over four months, to Rs 295.70. Trading volume was 7.4 times its 20-day average.
  • Timken India: The Bangalore-based fabricated metal and hardware maker fell as much as 3.12 percent to Rs 698. Trading volume was 5.9 times its 20-day average.
  • Magma Fincorp: The Kolkata-based financial services provider rose as much as 5.26 percent, the most since March 12, to Rs 154. trading volume was 4.8 times its 20-day average.

MMTC, State Trading Corporation Surge On Merger Talk

Shares of MMTC surged 10 percent and State Trading Corporation advanced 5 percent after Commerce and Industry Minister Suresh Prabhu said that mergers of both state-run trading firms is on cards and the matter is under process, news agency Press trust of India reported.

Market Check

  • Indian equity benchmarks were trading in a narrow range as gains in Yes Bank, State Bank of India and ICICI Bank were offset by losses in Wipro, Infosys and oil & gas stocks.
  • The S&P BSE Sensex rose 0.2 percent to 32,675 and the NSE Nifty 50 index was little changed at 10,002.
  • Ten out of 19 sector gauges compiled by BSE were trading higher led by the S&P BSE Bankex index's 0.9 percent gain. On the flipside, the S&P BSE Oil & Gas index was the top sectoral loser, down 1.4 percent.
  • The broader markets were trading on a muted note with the S&P BSE MidCap and SmallCap indices trading little changed.
  • The overall market breadth was negative as 1,636 shares were declining while 867 were advancing on the BSE.

Top five Nifty gainers

  • Yes Bank up 4.4 percent
  • State Bank of India up 2.9 percent
  • Bajaj Finance up 1.7 percent
  • ICICI Bank up 1.3 percent
  • Larsen & Toubro up 1.1 percent

Top five Nifty losers

  • GAIL India down 4.7 percent
  • Wipro down 4 percent
  • Hindustan Petroleum down 3.3 percent
  • Adani Ports down 1.9 percent
  • Bharat Petroleum down 1.8 percent

Jubilant FoodWorks Surges For Sixth Straight Day, Hits Fresh Record High

Shares of the Noida-based operator of Domino's Pizza and Dunkin' Donuts rose for sixth straight day. The stock in today's trade gained as much as 3.14 percent to hit record high of Rs 2,348 amid heavy volumes.

Trading volume was 2.5 times its 20-day average for this time of the day.

JSW Steel Gains On Plan To Extend Texas Operations

Shares of the Mumbai-based steel maker rose as much as 1.3 percent to Rs 289.65 after its subsidiary — JSW Steel USA announced that it is mulling to invest upto $500 million to expand its operations at Texas.

IDBI Bank Falls As CBI Investigates Fraud Loan

Shares of the Mumbai-based government-owned lender fell as much as 5.4 percent to Rs 68 after a report stated that the CBI is investigating a loan scam.

Around 360 farmers and others from Andhra Pradesh and Adilabad district of Telangana allegedly borrowed Rs 540 crore from IDBI Bank in two cases of cheating, The Hindu newspaper reported based on complaints lodged by the bank's senior regional head and general manager of zonal office at Hyderabad.

Binani Industries Falls After NCLAT Rejects Contempt Plea

Shares of the Mumbai-based cement and zinc maker fell as much as 4.7 percent to Rs 84.35 after the National Companies Law Appellate Tribunal (NCLAT) rejected Binani Industries' contempt plea against the Resolution Professional.

NCLAT said the contempt plea against Resolution Professional is not maintainable.

Block Deal Alert

  • South Indian Bank has 27 lakh shares change hands in a block on BSE. Stock up 0.8 percent at Rs 22.85.

Buyers and sellers were not immediately known

Source: Bloomberg

Oil Marketing Companies Fall Tracking Surge In Crude Price

Shares of the state-run oil marketing companies — Bharat Petroleum, Indian Oil and Hindustan Petroleum fell after Brent Crude moved above $70 per barrel to trade close to fresh 52-week high.

Higher crude oil prices would result in lower margins for oil refiners.

  • Indian Oil fell 2.3 percent to Rs 165
  • Bharat Petroleum fell 2.6 percent to Rs 402
  • Hindustan Petroleum declined 4.6 percent to Rs 323

Lumax Auto Technologies Gains On Stock Split Approval

Shares of the Pune-based auto component maker rose as much as 5.3 percent to Rs 850 after its board approved sub-division of shares of the company from Rs 10 per share to Rs 2 per share.

Sandur Manganese & Iron Ore Gains On Increasing Annual Ore Production

Shares of the Karnataka-based maker of pig iron maker rose as much as 8.41 percent, the most in over a month, to Rs 1,123.95 after it said m anganese ore annual production in a mining lease has been increased from 7,400 to 32,000 tonnes.

Fortis Healthcare Rises As TPG Said To Near $1.1 Billion Deal

Shares of the Delhi-based hospital chain operator rose as much as 3 percent to Rs 147.85 after a consortium led by TPG is nearing an agreement to gain control of Fortis Healthcare, Bloomberg reported citing people with knowledge of the matter.

The investor group, which also includes Manipal Health Enterprises, could announce a deal as soon as the next few days, the report added citing people, who asked not to be identified because the information is private.

Ask Investment To BloombergQuint

  • Resolution to U.S. FDA issues to place pharma space in a sweet spot.
  • Believe exports should pick up for chemical, textile business.
  • See earnings doubling in next 4-5 years for India Inc.
  • Expect market to consolidate around current levels and move upward gradually.
  • Equity market valuation high compared to other assets.

Cadila Healthcare Gains On CLSA Upgrade, FDA Nod

Shares of the Ahmedabad-based drug maker rose as much as 3.3 percent, the most in over a month, to Rs 382.55 after it received final approval from the U.S. drug regulator for Metoprlol Succinate extended release tablets used in treatment of heart failure, high blood pressure and chest pain.

Meanwhile, CLSA has upgraded the stock to ‘Buy’ from ‘Underperform’ and raised its target price to Rs 450 from Rs 440.

CLSA in a note said:

  • Improving India outlook and strong US pipeline to drive earnings.
  • Improvement in new launches in U.S. expected in 2018.
  • Biosimilars, vaccines and novel research products are long-term growth drivers.
  • Cadila to look for more product deals in specialty space from current fiscal cash flows.
  • Expect 16 percent compounded growth rate in earnings through the financial years till March 2020.

Gujarat Gas Surges After A Big Block Deal

Shares of the Ahmedabad-based gas distribution company rose as much as 4.78 percent, the most in over two months, to Rs 856 after 2.47 crore shares representing 18 percent equity changed hands in a single block in pre-market trade.

Buyers and sellers were not immediately known

Source: Bloomberg

Indiabulls Real Estate Gains On Divesting Stake In Mumbai’s Commercial Real Estate

Shares of the Delhi-based commercial and residential real estate developer rose as much as 3.8 percent, the most since March 21, to Rs 199.20 after it executed a definitive agreement with global private equity investor Blackstone Group to divest 50 percent stake in its prime commercial properties in Mumbai for Rs 4,750 crore, according to an exchange filing by the company.

Opening Bell

Indian equity benchmarks were little changed as gains in Tata Steel, ICICI Bank and ONGC were offset by losses in Bharat Petroleum, ITC and Hindustan Petroleum.

The S&P BSE Sensex was little changed at 32,626 and the NSE Nifty 50 index was also little changed at 10,001.

Sixteen out of 19 sector gauges compiled by BSE were trading higher led by the S&P BSE Realty index’s 0.9 percent gain. On the other hand, the S&P BSE Information Technology index was the top sectoral loser, down 0.17 percent.

Block Deal Alert

  • Gujarat Gas has about 2.47 crore shares (18 percent equity) change hands in a block in pre-market trade.

Buyers and sellers were not immediately known.

Source: Bloomberg

Rupee Opens Higher Against U.S. Dollar

  • Indian rupee opened higher at 64.92 per U.S. dollar against Friday's close of 65.01.

Money Market Heads Up!

Yield on the Indian benchmark bond was little changed last week at 7.56 percent as traders stayed on the sideline in the absence of trading triggers.

This being the last week of the financial year and that too with only three working days, market focus is now on the calendar for government’s record bond sale program that starts the week of April 2.

Traders are worried about the fate of $93 billion bond sale plan in the absence of buying support from any direction. Some expect the yield to test 8 percent in the coming weeks if the government doesn’t take any steps to stoke demand. For today, the yield may stay in a range of 7.54-7.60 percent.

In the currency market, implied opening from forwards suggest rupee may start trading little changed at 64.9950 a dollar. Asian currencies are in the green and may offer some support to the local unit. Traders see the currency in a range of 64.80-65.25 a dollar in the day.

Brokerage Radar

CLSA on Arvind

  • Maintained ‘Buy’ with a price target of Rs 524.
  • Textiles returning to the growth path.
  • Strategic investments in textiles to drive growth.
  • Advanced Materials business gaining traction.
  • Arvind continues to explore advance material space through JV.
  • Cotton price volatility remains a near-term headwind.
  • Proposed demerger to create value.

Morgan Stanley on Tata Power

  • Maintained ‘Overweight’ with a price target of Rs 94.
  • Tata Power selling stakes in telecom business.
  • Continue to see potential upside from such moves as leverage profile improves.
  • Tata Power intends to sell stakes in defense business and other non-core investments.
  • These stake sales if executed, would help deleverage faster.

Citi on Larsen & Toubro

  • Maintained ‘Buy’; raised price target to Rs 1,563 from Rs 1,527.
  • Business environment has been more challenging than expected.
  • Government/PSUs/multilateral agencies continue to drive capex.
  • Margins likely to improve 50 basis points over the next three years.
  • Fourth quarter of every financial year is a swing quarter.
  • Management focus on RoE keeps us enthused.

Citi on Indraprastha Gas

  • Maintained ‘Buy’ with a price target of Rs 400.
  • Delhi budget goes green; Potential uplift to volumes.
  • Lower CNG vat in UP to incentivise CNG conversions.
  • Stay postitve on gas space on the back of host of structural factors.

CLSA on Cadila Healthcare

  • Upgraded to ‘Buy’ from ‘Underperform’; raised price target to Rs 450 from Rs 440.
  • Improving India outlook and strong US pipeline to drive earnings.
  • Improvement in new launches in U.S. expected in 2018.
  • Biosimilars, vaccines and novel research products are long-term growth drivers.
  • Cadila to look for more product deals in specialty space from current fiscal cash flows.
  • Expect 16 percent compounded growth rate in earnings through the financial years till March 2020.

CLSA on Indiabulls Real Estate

  • Maintained ‘Buy’ with a price target of Rs 311.
  • Deal to establish a valuation for Indiabulls Real Estate.
  • Deal to mark a major strategic step in deleveraging the development business.
  • Deal valuation of Rs 9,500 crore valuation should be accretive to Indiabulls.

JPMorgan on Reliance Industries

  • Maintained ‘Neutral’ with a price target of Rs 940.
  • RJIO continues content acquisition drive.
  • Expect spending on content to continue.
  • In near term it would still be all about telecom.
  • Jio remains key variable for Reliance Industries’ investment case.
  • Content monetisation key variable in Jio’s long term monetisation of large investment in telecom.

Citi on Coffee Day Enterprises

  • Maintained ‘Buy’; raised price target to Rs 350 from Rs 285.
  • Stable coffee business; Growth boosted by strong export numbers.
  • Commercialisation of key units to help profit growth in the second half of the next financial year.
  • Stake-sales in any allied business to aid cash flows and debt concerns.

SGX Nifty Recovers From Intraday Low Levels

Nifty futures on Singapore Exchange recovered from intraday low levels. The index which fell as much as 0.89 percent to 9,903, was trading flat at 9,990.

BQ Heads-Up!

Trading Tweaks

  • GAIL India, Kellton Tech and Oil India last trading day before going ex-bonus.
  • Talwalkars last trading day before ex-date for de-merger.

IPO Watch

  • Lemon Tree Hotels IPO day 1. Issue Price at Rs 54 - Rs 56 per share.
  • ICICI Securities IPO day 3. Issue subscribed 0.36 times on day 2.
  • Mishra Dhatu Nigam IPO issue subscribed 1.2 times on day 3.

Stocks To Watch

  • Indiabulls Real Estate signs pact with Blackstone to divest 50 percent stake in assets at an enterprise value of Rs 9,500 crore.
  • RIL to combine Saavn with its digital music service Jio Music. To invest up to $100 million in music service.
  • Sandur Manganese says manganese ore annual production in mining lease has been increased from 7,400 to 32,000 tonnes.
  • NTPC commissions first unit of 800 MW Lara power stations. With this total capacity of NTPC and NTPC group becomes 46,100 megawatts and 52,991 megawatts respectively.
  • Tata Power signed pact with Tata Sons to sell 40 percent stake in Panatone Finvest for Rs 1,542.61 crore. To sell 4.7 percent stake in Tata Communications to Panatone for Rs 613 crore.
  • Vedanta board approves to raise funds up to Rs 4,500 crore through private placement.
  • Lumax Auto to consider stock split in the ratio of 1:5.
  • NHPC commissions 50 megawatts solar project in Theni, Tamil Nadu.
  • Bharat Financial Inclusion completes direct assignment deals worth Rs 1,391 crore.
  • Capital First to consider fund raising on March 28.
  • Uttam Galva gets exchanges nod to declassify ArcelorMittal Netherlands BV as a promoter.
  • Seven firms ready to bid for Lanco Infratech. (The Economic Times)

F&O Cues

  • Nifty March futures closed trading at 10,003.9 at a premium of 6 points versus 13 points.
  • Nifty April futures trading at a premium of 49.6 points at levels of 10,047.6.
  • All series-Nifty open interest (OI) down 1 percent, Bank Nifty OI down 3 percent.
  • Nifty rollover at 23 percent, Bank Nifty rollover at 20 percent.
  • India VIX ended at 15.5, up 1.9 percent.
  • Max open interest for March series at 10,500 strike price call option, OI at 54.6 lakh shares, down 13 percent.
  • Max open interest for March series at 10,000 strike price put option, OI at 51.8 lakh shares, down 12 percent.

Stocks Seeing High Open Interest Change

Talking Points

Good Morning!

The Singapore-traded SGX Nifty, an early indicator of NSE Nifty 50 Index’s performance in India, fell 0.28 percent to 9,963 as of 6:47 a.m.

The sell-off that sent global markets into a tailspin last week stretched into Monday, with stocks in Japan and Australia declining amid concern that global growth may be hurt by American protectionist policies. U.S. equity futures offered some hope of stabilization.

Global stocks put in their worst week since the rout in early February and erased all of the subsequent recovery, with losses deepening into the close of Friday trading in the U.S.

Here’s a list of what’s coming up this week:

  • U.S. personal income and spending data for February, coupled with the Fed’s favored inflation gauge are the key pieces of U.S. data. Income and spending are forecast to grow at the same pace as January but consensus sees the core PCE deflator picking up to 1.6 percent from 1.5 percent.
  • This week’s European economic agenda is highlighted by March CPI readings in the big four euro-area economies and output data for the U.K. Headline inflation probably ticked up in Germany, France, Spain and Italy. A third estimate of U.K. GDP is set to confirm growth of 0.4 percent in the fourth quarter.
  • The U.S. Treasury will probably auction about $294 billion of bills and notes this week, its largest slate of supply ever.
  • Crude oil contracts will begin trading Monday on the Shanghai International Energy Exchange.

Bonds

  • The yield on 10-year Treasuries rose one basis point to 2.82 percent.

Commodities

  • West Texas Intermediate crude climbed 0.7 percent to $66.34 a barrel.
  • Gold increased 0.1 percent to $1,348.76 an ounce, around the highest in more than a month.
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