Electronic ticker boards indicate the latest stock figures inside the atrium at the National Stock Exchange (NSE) in Mumbai, India (Photographer: Dhiraj Singh/Bloomberg)

All You Need To Know Going Into Trade On April 18

Asian equities pushed higher at the start on Wednesday as an encouraging U.S. earnings season underscored resilient growth.

Stock benchmarks climbed in Japan, Hong Kong and Australia. The Singapore-traded SGX Nifty, an early indicator of NSE Nifty 50 Index’s performance in India, rose 0.5 percent to 10,610 as of 7:05 a.m.

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

Global Cues

  • U.S. stocks rallied for a second day amid better-than-expected earnings from industry heavyweights, adding to evidence that the strengthening economy is lifting corporate profits.
  • The yield on 10-year Treasuries fell one basis point to 2.812 percent.

Europe Check

  • European stocks rose in a broad rally, buoyed by a falling euro and optimism spurred by better-than-expected corporate profits from some U.S. industry heavyweights.
  • The euro fell 0.1 percent to $1.2371.
  • The British pound declined 0.4 percent to $1.4285, the first retreat in more than a week.
  • Germany’s 10-year yield decreased two basis points to 0.51 percent.
  • Britain’s 10-year yield dipped three basis points to 1.436 percent.

Asian Cues

Chinese stocks pointed to a rebound after a surprise move by the People’s Bank of China to cut the reserve requirement ratio to improve funding arrangements for banks.

  • Japan’s Topix index rose 0.7 percent.
  • Australia’s S&P/ASX 200 Index added 0.2 percent.
  • The Kospi index rose 0.9 percent.
  • Futures on Hong Kong’s Hang Seng Index advanced 1.2 percent.
  • S&P 500 futures rose 0.1 percent.

Here are some global key events coming up this week:

  • Morgan Stanley is among companies reporting results this week.
  • The Bank of Canada has a monetary policy decision.
  • Prime Minister Narendra Modi to hold talks with British counterpart Theresa May

Commodity Cues

  • West Texas Intermediate crude rose 0.5 percent to $66.86 a barrel.
  • Gold fell 0.1 percent to $1,346.36 an ounce.
  • Brent trades higher at $71.9 per barrel; up 0.4 percent
  • Sugar ended lower at 11.8 cents per pound; down 2.9 percent.

Shanghai Exchange

  • Steel snapped two-day losing streak; up 1.6 percent.
  • Aluminium traded higher for fourth day; up 0.2 percent.
  • Zinc traded higher for third day; up 1 percent.
  • Copper traded lower; down 0.3 percent.
  • Rubber snapped two-day losing streak; up 0.4 percent.

Stories You Might’ve Missed

Indian ADRs

Nifty Earnings To Watch

  • ACC

Other Earnings To Watch

  • HDFC Standard Life Insurance Company
  • Mastek
  • MindTree

Earnings Reactions To Watch

Tata Sponge Iron (Q4, YoY)

  • Revenue up 46 percent at Rs 243.5 crore.
  • Net profit at Rs 47 crore versus Rs 21 crore.
  • Ebitda at Rs 61.5 crore versus Rs 25.5 crore.
  • Margin at 25.3 percent versus 15.3 percent.

Orchid Pharma (Q4, YoY)

  • Revenue down 20 percent at Rs 144 crore.
  • Net loss of Rs 77 crore versus net loss of Rs 65 crore.
  • Ebitda down 31 percent at Rs 13.5 crore.
  • Margin at 9.4 percent versus 10.8 percent.

5Paisa Capital (Q4, YoY)

  • Revenue at Rs 8 crore versus Rs 5 crore.
  • Net loss of Rs 7 crore versus net loss of Rs 3 crore.

Stocks To Watch

  • Fortis Healthcare received non-binding interest from Fosun.
  • Lupin received tentative U.S. FDA approval for generic AndroGel.
  • Indian Hume Pipe Company Ltd received order of Rs. 108.19 crore.
  • Shalby Signs memorandum of understanding with Sen Sok International University Hospital, Cambodia.
  • Ducon received final NCLT order approving ongoing merger process.
  • Jayaswal Neco Industries said Supreme Court directed parties involved in debt restructuring of company to maintain status quo.
  • AstraZeneca to invest $90 million over the next five years in India.
  • Vedanta’s resolution plan for Electrosteel Steels approved by NCLT. Vedanta will hold 90 percent stake while existing shareholders and creditors to get the remaining 10 percent.
  • KS Oils said corporate insolvency resolution process expired on April 16. The committee of creditors has not approved resolutions plans.
  • Andhra Bank said that the exposure to SSK Trading of Rs 30 crore is non performing asset. (Bloomberg)
  • HAL enhanced jet production capacity. (Bloomberg)
  • Jagran Prakashan to consider share buyback on April 27.
  • Uttam Galva says lenders yet to accept offer to settle debt.
  • Future Consumer hiked stake in Integrated Food Park Pvt. Ltd. to 99.93 percent.
  • ‘Well wishers’ cleared Kochhar company dues prior to ICICI Bank appointment; Credential Finance settled dues before Chanda Kochhar became ICICI Bank CEO (Economic Times).
  • Tata Steel raises $1.9 billion in loans as it looks to refinance high-cost debt of its Singapore unit; fresh loans priced at 200 basis points above LIBOR (Economic Times).

Bulk Deals

  • Karda Constructions: Capstone Capital Partners sold 87,360 shares or 0.7 percent equity at Rs 185.94 each.
  • Kwality: UA Enterprises Pvt Ltd sold 12 lakh shares or 0.5 percent equity at Rs 59.06 each.
  • Talwalkar Fitness: Tata MF sold 4.09 lakh shares or 1.3 percent equity at Rs 88.41 each.
  • Ajmera Realty: Promoter Rajnikant Ajmera sold 5 lakh shares or 1.4 percent equity at Rs 282.6 each.
  • Idea Cellular: First State Investments ICVC- Stewart Investors Asia Pacific Leaders Fund sold 3.92 crore shares or 0.9 percent equity at Rs 71.5 each.
  • Moldtek: AKG Finvest sold 1.5 lakh shares or 0.5 percent equity at Rs 50 each.

Who’s Meeting Whom

  • GRP Ltd to meet analysts/investors on April 18.
  • Finolex Industries to meet Valuequest Research.
  • Ganesha Ecosphere to meet analysts/investors on April 18-19.
  • Majesco to meet Quant Broking on April 18.
  • Rico Auto to meet analysts/investors on April 18.
  • Bhansali Engineering Polymers to meet Prabhudas Lilladher on April 18.
  • UFO Moviez to meet analysts/investors on April 18.

Insider Trades

  • VIP Industries promoters acquired 1.19 lakh shares on April 11.
  • Garnet International promoter Kartik Gaggar acquired 29,000 shares on April 13.
  • Aarti Industries promoter Chandrakant Gogri sold 5,321 shares from April 12–13.
  • Liberty shoes promoter Arpan Gupta sold 1,500 shares on April 13.
  • Rajesh Exports promoter Rajesh Mehta acquired 1,616 shares on April 16.
  • Ramkrishna Forgings promoter Riddhi Portfolio Private Limited acquired 10,000 shares on April 13.
  • Adani Power promoter Pan Asia Trade and Investment Pvt. Ltd. Acquired 90 lakh shares on April 16.
  • Vishal Fabrics promoter Vedprakash D. Chiripal acquired 39,000 shares on April 16.
  • CL Educate promoter Gautam Puri acquired 553 shares.
  • Avadh Sugar & Energy promoter Chandrashekhar Nopany acquired 5,000 shares on April 16.

Trading Tweaks

  • Phillips Carbon Black last trading day before 5:1 stock split.
  • Foods & Inns last trading day before 10:1 stock split.
  • Talwalkars Better Value Fitness Ltd placed under Additional Surveillance Measures with effect from today by BSE.

Rupee

  • Rupee closed at 65.65/$ on Tuesday from 65.49/$ on Monday.

Top Gainers And Losers

F&O Cues

  • Nifty April futures closed trading at 10,551 with a premium of 2.5 points versus 14.6 points.
  • April series: Nifty open interest up 2 percent, Bank Nifty open interest up 5 percent.
  • India VIX ended at 14.04, down 1.5 percent.
  • Max open interest for April series at 10,700 (open interest at 46.3 lakh, up 5 percent).
  • Max open interest for April series at 10,400 (open interest at 52.6 lakh, down 2 percent).

F&O Ban

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

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 1.63 versus 1.65.
  • Nifty Bank PCR at 1.47 versus 1.53.

Stocks Seeing High Open Interest Change

Fund Flows

Brokerage Radar

Edelweiss on Future Supply Chain

  • Initiated ‘Buy’ with a price target of Rs 862.
  • Expect demand boom for third party logistics services.
  • Rapidly expanding anchor client to ensure growth.
  • Asset-light model to ensure strong free cash flow.
  • Improving working capital cycle to spur return ratios.
  • Expect revenue, operating income and earnings per share to compound at 36 percent, 33 percent and 36 percent over the fiscal 2018-2020.
  • Future Supply well placed to capture opportunity.

Motilal Oswal on Room Air Conditioners

  • 2018 to be another year of strong industry growth.
  • AC penetration to inch up from current low levels.
  • Expect 15 percent compounded growth rate in room AC industry over the fiscal 2018-2020.
  • Inverters’ share in industry volumes to rise to 50 percent by March 2020.
  • Prefer Blue Star over Voltas.

Haitong on ICICI Lombard

  • Maintained ‘Buy’ with a price target of Rs 1,000.
  • Star Health acquisition could significantly increase ICICI Lombard’s retail health book.
  • Retail health has been a profitable segment for insurers.
  • Potential acquisition of Star Health could be positive.

Macquarie on Phoenix Mills

  • Maintained ‘Outperform’ with a price target of Rs 732.
  • Phoenix Mills-CPPIB inked an agreement to purchase 16 acres of land in Hebbal - media reports.
  • Catchment area for the mall is good.
  • Visibility of growth increasing.
  • Phoenix Mills is one of our top picks in the Indian real estate space.

CLSA on Vedanta

  • Maintained ‘Buy’ with a price target of Rs 410; implying a potential upside of 42 percent from the last regular trade.
  • Acquired Electrosteel Steels at attractive valuations.
  • Acquisition price implies an EV/tonne of $562.
  • If capacity expanded to 2.5 MTPA, then EV/tonne down to $409.
  • Acquisition marginally EPS/Value accretive at full utilisation and EBITDA/tonne of $120.

CLSA on FMCG

  • Dabur: Upgraded to ‘Buy’ from ‘Outperform’; raised price target to Rs 415 from Rs 400.
  • Rural growth outlook improving.
  • Pressures from Patanjali Ayurved seem to be behind.
  • IMD forecast and expected increase in MSP is positive.
  • Emami, Dabur, HUL and Colgate have highest rural exposure.
  • Top consumer picks: Emami, Dabur, ITC, Varun Beverages and Jubilant Foods.

HSBC on India Non-Ferrous

  • Ongoing disruptions have led to a surge in alumina and aluminium prices.
  • Integrated producers to benefit more.
  • Q4 earnings to be lacklustre on the back of rising input cost.
  • Hindalco: Maintained ‘Buy’; raised price target to Rs 305 from Rs 284.
  • Hindustan Zinc: Maintained ‘Buy’; raised price target to Rs 370 from Rs 365.
  • Vedanta: Maintained ‘Buy’; cut price target to Rs 405 from Rs 435.
  • Supply cuts due to ongoing disruptions pose further upside.

CLSA on India Power

  • Government’s 24x7 plan has better chances of being implemented
  • Expect 30 percent rise in demand.
  • Lays foundation for next bull market for power stocks.
  • Expect utilities to report profit growth of 5-15 percent in the current quarter
  • Buy: NTPC, Power Grid, CESC, Tata Power.
  • Sell: Adani Transmission, Adani Power and JSW Energy.
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