All You Need To Know Going Into Trade On April 17

Stocks in Asia edged higher at the open on Tuesday as investors assessed early indications from America’s corporate earnings season and traders awaited a slew of data on China’s economy.

The Singapore-traded SGX Nifty, an early indicator of NSE Nifty 50 Index’s performance in India, fell 0.1 percent to 10,535 as of 7:15 a.m.

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BQ Live

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

Global Cues

• U.S. stocks rose as geopolitical tensions faded and investors turned to what’s expected to be a blowout corporate earnings season.
• The yield on 10-year Treasuries were little changed at 2.83 percent.

Europe Check

• European stocks began the week with a loss as a stronger euro weighed on the export-oriented market amid easing geopolitical tensions.

• The euro gained 0.4 percent to $1.2375.
• The British pound rose 0.7 percent to $1.4333, hitting the strongest in about 22 months.
• Britain’s 10-year yield increased three basis points to 1.463 percent.
• Germany’s 10-year yield rose one basis point to 0.525 percent.

Asian Cues

• Japan’s Topix index fluctuated as of 9:18 a.m. in Tokyo.
• Australia’s S&P/ASX 200 Index rose 0.5 percent.
• The Kospi index rose 0.3 percent.
• Futures on Hong Kong’s Hang Seng Index rose 0.6 percent.
• S&P 500 futures rose 0.2 percent.

Here are some key events coming up this week:

• Goldman Sachs Group Inc. and Morgan Stanley among companies reporting results
• John Williams, soon to be president of the New York Fed, speaks on economic outlook in Madrid on Tuesday.
• China GDP and Japanese inflation are the featured data points in Asia.
• Trump welcomes Japan Prime Minister Shinzo Abe to Mar-a-Lago on Tuesday. North Korea and trade will probably be discussed.
• Mining investors will get to take the pulse of the global industry this week, with Vale, Rio Tinto and BHP offering quarterly production reports.

Commodities Check

• Gold rose 0.1 percent to $1,347.83 an ounce.
• West Texas Intermediate crude rose 0.5 percent to $66.56 a barrel after dipping 1.7 percent on Monday in the first retreat in more than a week.
• Brent traded higher at $71.8 per barrel; up 0.5 percent.
• Sugar snaps two-day winning streak ends lower at 12.2 cents per pound; down 0.3 percent.

Shanghai Exchange

• Steel traded lower for second day; down 1.2 percent.
• Aluminium traded higher for third day; up 2.4 percent (highest level since Jan. 30).
• Zinc traded higher for second day; up 0.3 percent.
• Copper snapped three-day losing streak; up 0.8 percent.
• Rubber traded lower for second day; down 1.7 percent.

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Indian ADRs

Earnings Reaction To Watch

Lloyds Metals (Q4, YoY)

• Revenue at Rs 109 crore versus Rs 73 crore.
• Net profit at Rs 9.9 crore versus Rs 4.7 crore.
• Ebitda at Rs 7 crore versus Rs 12 crore.
• Margin at 6.4 percent from 16.4 percent.

Jay Bharat Maruti (Q4, YoY)

• Revenue down 1 percent at Rs 480 crore.
• Net profit down 14 percent at Rs 18 crore.
• Ebitda up 14 percent at Rs 48 crore.
• Margin at 10 percent versus 8.7 percent.

Earnings To Watch

• Crisil
• Muthoot Capital Services
• Orchid Pharma
• Tata Sponge Iron
• 5paisa Capital
• Gujarat Hotels
• International Travel House
• Onelife Capital Advisors
• Schaeffler India

Stocks To Watch

• WS Industries proposed a one-time settlement with SBI and discussed settlement with Edelweiss Arc among others.
• Sobha will invest Rs 500 crore for residential project in GIFT City, Gujarat.
• Sterlite Technologies board to consider raising funds through issue of securities on April 25.
• Omkar Specialty Chemicals says Bank of Baroda classified its loan account as NPA.
• Bajaj Electricals bags orders worth Rs 3,578 crore for rural and urban electrification projects in Uttar Pradesh.
• Reliance Communications says NCLAT to hear tower sale appeal on tower sale on April 18.
• BlueStar signs up with Sands International and its partners for distribution of products in Saudi Arabia.
• Goa Carbon resumes operations at Orissa plant which was shut for maintenance.
• Adani Ports signs long term regasification pact with Indian Oil for Dhamra LNG Terminal.
• Fortis Board to meet on April 19 to consider various offers received.
• HDFC says AMC units FY18 total revenue up 18 percent (YoY) to Rs 1,867 crore, net profit up 31 percent to Rs 721 crore.
• Alok Industries says resolution professional seeks liquidation.
• Amtek Auto says submitted resolution plan with NCLT.
• Religare Enterprises received order from HC stating that the long stop date under SPA cannot be extended further.
• JM Financial unit acquires additional 8.78 lakh shares in Spandana.

Bulk Deals

• GSS Infotech: Nomura Singapore bought 1 lakh shares or 0.6 percent equity at Rs 61 each.
• Majesco: Promoter Sudhakar Ram sold 1.50 lakh shares or 0.5 percent equity at Rs 520 each.
• Goodluck India: Union KBC Equity Fund sold 2.35 lakh shares or 1 percent equity at Rs 86.74 each.

Teamlease Services

• Franklin India Smaller Companies Fund bought 3 lakh shares or 1.8 percent equity at Rs 2,150 each.
• Promoter HR Offshore Ventures PTE sold 1.70 lakh shares or 1 percent equity at Rs 2,150 each.
• Promoter NED Consultants LLP sold 85,483 shares or 0.5 percent equity at Rs 2,150 each.

Who’s Meeting Whom

• Hikal Ltd to meet analysts and investors on April 17-18.
• M&M to meet Motilal Oswal on April 18.
• BigBloc Construction to meet investors and analysts at its Umargaon plant on April 17.
• Den networks to meet investors on April 17.
• Simplex Infra to meet investors from April 17-25.
• Sandhar Tech to meet JM Financial, Buoyant capital and I-Wealth Mgmt from April 17-19.
• PPAP Automotive to meet Edelweiss on April 18.
• Wonderla to meet investors on April 17.

Insider Trades

• Maharashtra Seamless Promoter Sudha Apparels acquired 1 lakh shares on April12.
• Plastiblends promoter Jyoti Kabra acquired 4,903 shares from April 10–11.
• Chaman Lal Setia promoters sold 26,300 shares from April 11–14.
• Divi’s Lab promoter Madhusudana Rao Divi sold 4,374 shares on April 13.
• Adani Power promoter Pan Asia Trade and Investment Pvt. Ltd. acquired 50 lakh shares on April 13.
• Lasa Supregenerics promoter Pravin Herlekar sold 24,000 shares from April 10–11.

Rupee

• Rupee closed at 65.49/$ on Monday from 65.22/$ on Friday.

Top Gainers And Losers

Index Trends

F&O Cues

• Nifty April futures closed trading at 10,543 with a premium of 14.6 points versus 9.8 points.
• April series: Nifty open interest up 1 percent, Bank Nifty open interest up 4 percent.
• India VIX ended at 14.2, up 0.8 percent.
• Max open interest for April series at 10,700 (open interest at 44 lakh, up 9 percent).
• Max open interest for April series at 10,300 (open interest at 55 lakh, up 6 percent).

F&O Ban

• In ban: Balrampur Chini, IRB Infra, JP Associates, TV18 Broadcast, Reliance Communications.
• New in ban: Reliance Communications.

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

Put-Call Ratio

• Nifty PCR at 1.65 versus 1.63
• Nifty Bank PCR at 1.53 versus 1.45

Stocks Seeing High Open Interest Change

Fund Flows

Brokerage Radar

Angel Broking on Parag Milk Foods

• Initiated ‘Buy’ with a price target of Rs 333.
• Likely to be one of the key beneficiaries of shift towards organized sector.
• Product portfolio shifting towards high margin products.
• Margin expansion to be highest in industry by March 2020.
• Reducing leverage and improving return ratios.
• Expect revenue and net profit to compound at 13 percent and 27 percent respectively over the fiscal 2018-2020.

IIFL on Prataap Snacks

• Maintained ‘Buy’ with a price target of Rs 1,720.
• Attractively placed to tap the huge opportunity in organised snacks.
• Multiple revenue drivers in sight.
• Expect revenue and net profit to compound at 19 percent and 107 percent over the fiscal 2017-2020.
• Margin to improve led by raw material cost saving and favorable mix.
• Prataap is attractively valued to nearest listed competitor.

Credit Suisse on NTPC

• Maintained ‘Outperform’ with a price target of Rs 190.
• Coal shortage situation has not eased.
• Coal stocks remained well below last year level.
• NTPC plants continue to face availability issue on coal.
• Valuations attractive with multiple earnings growth catalysts.

Motilal Oswal on L&T Finance

• Maintained ‘Buy’ with a price target of Rs 240; implying a potential upside of 41 percent from the last regular trade.
• Post equity raise, NBFC well capitalised for growth.
• Don’t need to raise equity capital at least for next 3-4 years.
• Non-fund based businesses on a strong growth trajectory.

CLSA on Nestle

• Downgraded to ‘Outperform’ from ‘Buy’; hiked price target to Rs 9,750 from Rs 8,950.
• Working-capital improvement and strong free cash flow generation seen in 2017.
• Return ratios improved, but remain below the past peak.
• Aggression on launches has increased, but near-flat advertising spends disappoint.
• Downgraded on 13 percent rally seen in past one month.

CLSA on M&M

• Maintained ‘Buy’; raised price target to Rs 960 from Rs 910.
• Rural demand outlook improved with normal monsoon forecast.
• Big hike in government support prices for agri commodities on the anvil.
• Launch of new MPV to boost utility vehicle segment volumes.
• Good volume growth outlook.
• Valuations attractive despite better earnings outlook.

Brokerages on India’s Monsoon Forecast

CLSA says

• Normal monsoon forecast to aid rural recovery.
• Agri output likely to stay steady.
• Expect rural wage growth to pick up.
• Key beneficiaries: ITC, Emami, M&M, Godrej Consumer and Ramco.

Morgan Stanley says

• IMD projects normal monsoon.
• Don't expect any adverse impact on underlying food inflation trends.
• Government's procurement policy of crops will be key to watch.

Kotak says

• Normal monsoon on the cards.
• Premature to conclude on effects on growth and prices.
• Forecast to bode well for the rural sector.
• Expect extended pause from the RBI.