Reliance Lifts Sensex, Nifty To Over Two-Month High

Indian equity benchmarks rose to their highest level since Feb. 5 powered by strong gains in Reliance Industries, HDFC and ICICI Bank.

The S&P BSE Sensex rose 0.48 percent or 165.87 points to 34,616.64 and the NSE Nifty 50 index advanced 0.28 percent or 29.65 points to 10,614.35.

Twelve out of 19 sector gauges compiled by BSE ended higher led by the S&P BSE Energy index's 2.39 percent gain. On the flipside, the S&P BSE Metal index was the top sectoral loser, down 1.8 percent.

The mid- and small-cap shares underperformed their large-cap counterparts as the S&P BSE MidCap and S&P BSE SmallCap indices ended marginally lower.

• GATI: The Secunderabad-based cargo distribution and logistics service provider was locked in a 20 percent upper circuit at Rs 120.90. The company will hold board meeting on April 26 to consider inducting new partner to augment future growth.
• GNFC: The Gujarat-based fertilizer and chemical maker rose as much as 10.73 percent, the most in over three months, to Rs 475.90 after reporting its March quarter earnings.
• Alkem Labs: The Mumbai-based drug maker rose as much as 6.2 percent to Rs 1,945 after Nomura upgraded it to ‘buy’ from ‘neutral’ and raised its target price to Rs 2,089 from Rs 2,298, indicating upside of 17 percent.
• KP Energy: The Surat-based wind turbine maker rose as much as 7.9 percent to Rs 326 after it signed a pact with Global WTG unit for 300 MW wind power project in Gujarat.

Reliance Industries' 960 strike price call option contract was among the most active stock option contracts on the National Stock Exchange. The premium on the contract jumped over 8 times to Rs 15.85.

Open interest in the contract was reduced by 8.03 lakh shares and it stood at 17.51 lakh shares.

Click here to see the complete options chain

Europe’s shares were little changed in early trade as investors assessed earnings from companies including Volvo and Banco Santander, while a slump in aluminum prices continued to rock mining stocks.

Shares of private sector insurance company rose 4.57 percent after it reported March quarter earnings.

Key earnings highlights:

• Consolidated net profit down 16.7 percent at Rs 340 crore versus Rs 408 crore (YoY)
• Net premium income at Rs 8,655.8 crore versus Rs 7,526.4 crore (YoY)
• Solvency ratio at 252.5 percent versus 280.7 percent (YoY)
• 13-month persistency ratio by premium at 85.7 percent versus 84.3 percent (YoY); 81.8 percent (QoQ)
• 61-month persistency ratio by count at 49.5 percent versus 48.2 percent (YoY); 46.1 percent (QoQ)

Shares of the Noida-based entertainment channel operator fell as much as 5.5 percent to Rs 55.15 after its loss widened in March quarter.

Key earnings highlights:

• Net loss at Rs 47.18 crore versus Rs 33.31 crore (YoY)
• Revenue at Rs 820 crore
• Total cost at Rs 850 crore

Shares of the Secunderabad-based fertiliser maker fell as much as 7.8 percent, the most since Aug. 2017, to Rs 487.70 after it missed consensus Bloomberg estimates in March quarter.

Key earnings highlights:

• Revenue at Rs 2,370 crore versus Rs 2,290 crore (YoY)
• Net profit fell 49 percent to Rs 73.53 crore versus Rs 144.27 crore (YoY)
• Net profit at Rs 73.53 crore versus estimate of Rs 159 crore
• Consolidated margin at 7.1 percent versus 12.1 percent (YoY)
• Consolidated EBITDA down 37.9 percent at Rs 169 crore versus Rs 272.3 crore (YoY)
• Company to pay Rs 3.5/share final dividend

• Hathway Cables has 61.9 lakh shares change hands in two blocks. Stock down 7 percent at Rs 35.75.
• Indian Oil has 10 lakh shares change hands in a block. Stock up 1.6 percent at Rs 164.25.

Buyers and sellers were not immediately known

Source: Bloomberg

Shares of the Delhi-based news channel operator fell after it reported loss in March quarter.

Key earnings highlights:

• Consolidated revenue at Rs 757.7 crore versus Rs 278.9 crore (YoY)
• Consolidated net loss at Rs 2.98 crore versus profit of Rs 8.39 crore (YoY)

• Advanced Enzyme Technologies: The Mumbai-based specialty chemical maker rose as much as 9.2 percent to Rs 256.80. Trading volume was 45.8 times its 20-day average.
• KPR Mills: The Coimbatore-based apparel maker rose as much as 2.45 percent to Rs 687. Trading volume was 23.8 times its 20-day average.
• Allcargo Logistics: The Mumbai-based logistics service provider rose as much as 3.5 percent to Rs 156.60. Trading volume was 27.5 times its 20-day average.
• WABCO India: The Chennai-based auto parts maker rose as much as 1 percent to Rs 8,001. Trading volume was 24.2 times its 20-day average.

Shares of the Hyderabad-based rug maker rose 0.8 percent to Rs 2,152.

Dr Reddy's Labs informed exchanges that it has received Establishment Inspection Report (EIR) from U.S. FDA for its Mirfield plant in UK.

Shares of the Vadodara-based electrical component maker was locked in 4.84 percent lower circuit at Rs 4.13.

The Enforcement Directorate (ED) attached Diamond Power's properties worth Rs 1,120 crore in bank fraud case.

Indian equity benchmarks held on to gains as buying in private sector lenders and Reliance Industries outpaced losses metal stocks.

The S&P BSE Sensex rose 0.4 percent or 141 points to 34,591 and the NSE Nifty 50 index gained 0.16 percent or 17 points to 10,601.

Seven out of 11 sector gauges compiled by the National Stock Exchange were trading higher led by the Nifty Pharma index's 0.9 percent gain. On the flipside, the Nifty metal index was the top sectoral loser, down 2.28 percent.

The overall market breadth was marginally positive as 1,275 stocks were advancing while 1,022 were declining.

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Shares of the Secunderabad-based cargo distribution and logistics support service provider rose as much as 17.47 percent, the most in nearly three years, to Rs 118.35.

The company post market hours informed exchanges that its board will be meeting on April 26 to consider resolution on inducting new financial/strategic partner to augment future growth of the company.

Shares of the Gujarat-based fertiliser and chemical maker rose as much as 10.7 percent, the most in over three months, to Rs 475.90 after it reported March quarter earnings. The stock also rose to its highest level in a month.

Key earning highlights:

• Revenues up 46.5 percent at Rs 1,764 crore versus Rs 1,204 crore
• Net profit up 38 percent at Rs 329 crore versus Rs 238 crore
• Exceptional gain of Rs 292 crore in the base quarter
• EBITDA up 16.5 times at Rs 471 crore versus Rs 28.5 crore
• Margin at 26.7 percent versus 2.4 percent

Shares of the Mumbai-based offshore casino operator rose as much as 5.88 percent to record high of Rs 301.40 after its profit jumped four times in quarter ended March 2018.

Delta Corp's net profit came in at Rs 45 crore in March quarter compared with Rs 11 crore during the same period last year.

Its revenue from operations rose 46.5 percent to Rs 539 crore compared with Rs 368 crore.

Betting Business Has Paid Off Well: Delta Corp

In an interview to BloombergQuint Hardik Debar, group CFO, Delta Corp said its gaming business has been the key growth driver in the past and will continue to drive future growth as well.

Highlights of conversation:

• Shutdowns due to license fee shakeout will expand the market
• Effective impact of hike in license fee approximately at Rs 32 crore
• May have to pay an additional Rs 48-50 crore for four casinos in Goa
• Paying close to Rs 40 crore as license fee for four casinos in Goa
• Will pass on the hike in license fee and structure the business model
• Hike in license fee could trigger consolidation in the industry
• Property in Sikkim is an operational casino, new airport key reason behind the venture
• Gaming business will continue to drive growth in the future

Shares of the Mumbai-based Anil Ambani-led defence equipment maker fell as much as 9 percent, the most in over two months, to record low of Rs 24.50 after its loss widened in the March quarter.

Reliance Naval's loss widened to Rs 406 crore from loss of Rs 140 crore during the same quarter a year ago. Meanwhile, its revenue slumped 85.5 percent to Rs 33 crore from Rs 228 crore.

Nifty 10,500 strike price put option contract was among the most active option contracts on the NSE. The premium on the contract fell 22 percent to Rs 15.50.

Over 4.59 lakh shares were reduced from the open interest which stood at 53.14 lakh shares.

Click here to see the complete options chain

Shares of the information technology solutions firm fell 10.2 percent, the most in over 17 months, to Rs 5.3.

The company’s net profit in the March-ended quarter dropped to Rs 23 crore from Rs 32.4 crore a year earlier.

Shares of the Gurugram-based telecom infrastructure company fell as much as 3.77 percent to Rs 315.65 after its operating profit saw a marginal dip in March quarter.

Bharti Infratel's operating profit or EBITDA fell 0.4 percent to Rs 1,606 crore in March quarter from Rs 1,613 crore in the previous quarter.

EBITDA margin also declined to 43.8 percent from 44.1 percent in December quarter.

Pramod Gubbi, managing director and head of institutional equities at Ambit Capital told BloombergQuint that the market is currently focusing on quality companies in the ongoing rally.

Highlights of conversation:

• Expect current quarter earnings to be better both on sequential and yearly basis
• Expect dollar to strengthen further
• Consumption stocks valuations are on the higher side
• Couple of rate hikes may not dent the market sentiment
• Volatility has always been there in commodities market and expect it to stay

Shares of sugar producers in the country surged on expectations that the government may impose a subsidy on sugarcane.

An informal ministerial panel yesterday explored options of the production-linked subsidy, imposition of a sugar cess and reducing goods and services tax on ethanol to help sugar mills in clearing dues worth Rs 19,000 crore to sugarcane farmers. (To read more on this story, click here)

• Balarampur Chini Mills Ltd. rose as much as 4.3 percent to Rs 71.6
• Dhampur Sugar Mills Ltd. rose as much as 4.5 percent to Rs 101.7
• Bajaj Hindusthan Sugar Ltd. rose as much as 3.9 percent to Rs 9.3
• KCP Sugar and Industries Corporation Ltd. rose as much 3.4 percent to Rs 25.9

Shares of Hindalco, Vedanta and NALCO fell as much as 9 percent after aluminium slumped 7 percent on London Metal Exchange, the most since 2010, following softening of the U.S. government’s stance on Russian sanctions.

The U.S. softened its position on sanctions against Russian metals giant United Co. Rusal, sparking a record plunge in aluminum prices.

Indian equity benchmarks edged higher led by private sector lenders, Reliance Industries and HDFC. However, the gains were capped as metal stocks fell sharply after aluminium slumped 7 percent on LME following softening of the U.S. government’s stance on Russian sanctions.

The S&P BSE Sensex rose 0.4 percent or 150 points to 34,595 while the NSE Nifty 50 index advanced 0.17 percent or 18 points to 10,603.

Thirteen out of 19 sector gauges compiled by BSE were trading higher led by the S&P BSE Realty index's 1 percent gain. On the other hand, the S&P BSE Metal index was the top sectoral loser, down 2.4 percent.

• Indian rupee opened higher at 66.41 per dollar against yesterday's close of 66.48.

In an exclusive conversation with BloombergQuint, Priya Misra of TD Securities said continued rise in U.S. real rates could dent flows to emerging markets.

• Rise in real rates responsible for rising yields
• Rising deficit putting pressure on rates in U.S.
• Treasury supplies to double in 2019
• Rise in real rates to hurt U.S. economy
• Spread between U.S. and German bonds to compress

The rupee could weaken further and may hit a 13-month low on the back of a rising dollar and as foreign funds step up sales of the nation's bonds.

Overseas investors sold a net Rs 540 crore of bonds on Monday making it the seventh successive day of outflows and which is the longest streak since Sept. 2017. The implied opening from forwards suggests the rupee may open around 66.47, having lost over 0.5 percent to close at 66.48 per dollar on Monday.

Meanwhile, bond yields are also likely to inch up given higher oil prices will fan inflationary pressures. Traders will also watch 10 states selling Rs 11,600 crore of bonds as well as treasury yields with the 10-year note hovering just shy of the 3 percent mark. The yield on the 10-year sovereign debt rose 2 basis points to 7.74 percent on Monday, having gained 29 basis points last week.

Nomura on Alkem Labs

• Upgraded to 'Buy' from 'Neutral'; target price cut to Rs 2,089 from Rs 2,298
• Stock fall factors in concerns on Daman
• Cut EPS estimates by 13 percent/9 percent for FY19/20 to factor in lower U.S. sales
• Positive stance driven by high contribution from India

HSBC on M&M

• Maintain 'Buy'; Target price hiked to Rs 890 from Rs 840
• Q4 results and delay in new launches to not impact FY19/20 estimates
• Target price hike to largely factor in the increase in subsidiaries’ value
• Monsoon forecast positive for the rural-driven tractor industry

Credit Suisse on India Life Insurance

• APE growth moderated, but structural drivers intact.
• Macroeconomics drivers in place for sustained growth.
• Players having strong bank tie-ups outperforming.
• Rising RoEV will help sustain elevated multiples.
• ICICI Pru, SBI Life top picks; HDFC Life too expensive.
• ICICI Pru: Maintained ‘Outperform’; cut price target to Rs 495 from Rs 510.
• SBI Life: Initiated ‘Outperform’ with a price target of Rs 716.
• HDFC Life: Initiated ‘Outperform’ with a price target of Rs 496.

Motilal Oswal on Infosys

• Maintained ‘Buy’ with a price target of Rs 1,330.
• Granular strategy articulated around digital, core business, sales and talent.
• Company cited that the current financial year will be a year of stabilization.
• Next financial year to be a year of momentum building and the financial year-ending March 2021 will be a year of acceleration
• Expect current financial year to be a better year for BFS than the previous financial year.
• Multi-pronged investments in sales to focus on digital, large deals and new accounts.

Credit Suisse on Infosys

• Maintained ‘Neutral’ with a price target of Rs 1,100.
• New strategy well-articulated, but similar to peers; execution would be the key.
• Management indicated intention to make sales and marketing more robust.
• No new clarity on new margin guidance.
• Investments cited by the company are valid for Infosys.

Morgan Stanley on Cement

• Cement prices have strengthened/been flattish across region in Apr 2018.
• Expect prices to remain firm till mid/end May.
• Expect demand growth and rising utilisation to lend pricing power.
• Pricing power to drive margin expansion in the next financial year.
• Dealers are skeptical about the sustainability of price hike given muted demand growth.

• Bharti Airtel

Other earnings to watch

• Coromandel International
• GIC Housing Finance
• Hudco
• ICICI Prudential Life
• IDFC Bank
• Network18 Media
• Oberoi Realty
• Persistent Systems
• Raymond
• Tinplate
• TV18 Broadcast
• Zensar Tech
• Bharat Immunologicals
• DCM Shriram
• India Grid Trust
• Pioneer Distilleries
• Reliance Home Finance
• Sadbhav Engineering
• Supreme Petrochem
• Tejas Networks
• TRF

Bharti Infratel Q4 (QoQ)

• Revenue up 0.2 percent to Rs 3,662 crore versus Rs 3,655 crore
• EBITDA down 0.4 percent to Rs 1,606 crore versus Rs 1,613 crore
• EBITDA margin at 43.8 percent versus 44.1 percent
• Net profit up 3.6 percent at Rs 606 crore versus Rs 585 crore
• Tenancy ratio at 2.3 times versus 2.38 times

Reliance Infra Q4 (YoY)

• Revenues up 4 percent at Rs 5,167 crore versus Rs 4,973.5 crore
• Net profit up 290 percent at Rs 160 crore versus Rs 41 crore
• EBITDA up 49 percent at Rs 829 crore versus Rs 557.5 crore
• Margin at 16 percent versus 11.2 percent

Bharat Financial Inclusion Q4

• Revenue from operations grew 46.5 percent to Rs 539 crore versus Rs 368 crore
• Net profit at Rs 210.5 cr versus loss of Rs 235 crore
• Provisions at Rs 0.6 crore versus Rs 8.6 crore (QoQ)
• Loan portfolio growth at 38 percent (YoY)
• Loan disbursements grew 26 percent (YoY)

Delta Corp Q4 (YoY)

• Revenues up 59 percent at Rs 172 crore versus Rs 108 crore
• Net profit up 4 times at Rs 45 crore versus Rs 11 crore
• EBITDA up 100 percent at Rs 68 crore versus Rs 34 crore
• Margin at 39.5 percent versus 31.5 percent

GNFC Q4 (YoY)

• Revenues up 46.5 percent at Rs 1,764 crore versus Rs 1,204 crore
• Net profit up 38 percent at Rs 329 crore versus Rs 238 crore
• Exceptional gain of Rs 292 crore in the base quarter
• EBITDA up 16.5 times at Rs 471 crore versus Rs 28.5 crore
• Margin at 26.7 percent versus 2.4 percent

Swaraj Engines Q4 (YoY)

• Revenues up 15 percent at Rs 185 crore versus Rs 161 crore
• Net profit up 20 percent at Rs 18 crore versus Rs 15 crore
• EBITDA up 16.7 percent at Rs 28 crore versus Rs 24 crore
• Margin at 15.1 percent versus 14.9 percent

LIC Housing Finance Q4 (YoY)

• Net interest income down 1.4 percent at Rs 1,058 crore versus Rs 1,073 crore
• Net profit up 2 percent at Rs 539 crore versus Rs 529 crore

Indiabulls Ventures Q4 (YoY)

• Revenues up 131 percent at Rs 273 crore versus Rs 118 crore
• Net profit up 13 percent at Rs 61 crore versus Rs 54 crore
• EBITDA down 60 percent at Rs 16 crore versus Rs 40 crore
• Margin at 5.9 percent versus 34 percent

Reliance Naval and Engineering Q4 (YoY)

• Revenues down 85.5 percent at Rs 33 crore versus Rs 228 crore
• Net loss widens to Rs 409 crore versus loss of Rs 140 crore
• EBITDA at Rs -216 crore versus Rs 5 crore
• Margin at -654.5 percent versus 2.2 percent

3i Infotech Q4 (QoQ)

• Revenues up 17.5 percent at Rs 279 crore versus Rs 237.5 crore
• Net profit unchanged at Rs 23 crore
• EBIT up 12 percent at Rs 43 crore versus Rs 38.5 crore
• Margin at 15.4 percent versus 16.2 percent

Kewal Kiran Clothing Q4 (YoY)

• Revenue flat at Rs 120 crore versus Rs 121 crore
• Net profit down 19 percent at Rs 19.5 crore versus Rs 24 crore
• EBITDA down 16 percent at Rs 26 crore versus Rs 31 crore
• Margin at 21.7 percent versus 25.6 percent

• Thomas Cook shareholders to get 1,889 shares of Quess Corp for every 10,000 shares held in company under scheme of arrangement
• Shilpi Cables gets 90-day extension for CIRP
• Music Broadcast to acquire radio business of Ananda Offset on slump sale basis
• Geojit Financial to set up asset management company
• MOIL to procure its entire requirement of Silica Sand from Hindustan Copper
• JSW Steel, Aion have found eligible resolution applicant for Monnet Ispat (Bloomberg)
• Jet airways signs codeshare agreement with Aeromexico
• Astron Paper enters into MOU with Balaram Papers to take over its Gujarat plant
• India considering sugar cane production subsidy. Seeks to reduce GST on ethanol

• Nifty April futures closed trading at 10,585.5 with a premium of 1.45 points versus 21.5 points
• Nifty May Futures trading at 10,612.8 with premium of 28.8 points
• Nifty Rollover at 18 percent, Bank Nifty Rollover at 14 percent
• All series- Nifty open interest (OI) up 2 percent, Bank Nifty OI up 5 percent
• India VIX ended at 13.1, up 1.6 percent
• Max OI for April series call at 10,700 strike price call option, OI at 48.5 lakh, down 3 percent
• Max OI for April series put shifts to 10,500 strike price put option, OI at 57.7 lakh, up 5 percent

Minda Corp

• Ashish Kacholia bought 10.80 lakh shares or 0.5 percent equity at Rs 182 each.

Laurus Labs

• Norges Bank - Government pension fund bought 17.50 lakh shares or 1.7 percent equity at Rs 508 each.
• Nomura India Investment Fund Mother Fund sold 17.54 lakh shares or 1.7 percent equity at Rs 508 each.

Cimmco Ltd

• Porinju Veliyath’s Equity Intelligence India sold 1.11 lakh shares or 0.4 percent equity at Rs 94.8 each.

Astra Microwave

• Ratnabali Investment bought 43 lakh shares or 5 percent equity at Rs 83.58 each.
• Tarish Investment and Trading Company sold 31 lakh shares or 3.6 percent equity at Rs 83 each.

Trading Tweaks

• SKM Egg Products Exports (India) Ltd circuit filter revised to 10 percent.
• NBCC last trading day before stock split to Re 1 from Rs 2 per share.
• NSE Announces physical settlement for 46 stocks trading in the F&O segment.

• As bond traders struggle to bust 3%, Morgan Stanley sees a rally
• A fifth of stocks in NSE derivatives segment to move to physical settlement from July
• Bharti Infratel net profit meets estimates in March quarter
• Thomas Cook India gets board nod for corporate restructuring
• Congress to move Apex Court after Naidu rejects CJI impeachment notice
• Chief Minister Fadnavis, ally Sena differ over Maharashtra mega refinery project
• Walmart is close to $12 billion-plus deal for Flipkart
• Suresh Kumar assumes additional charge as Coal India chairman
• SGX to migrate all Nifty positions to new Indian derivatives from June 4
• PM Modi is clever, if only he was lazy too!
• Walmart sees India’s Flipkart as key to atone for China missteps
• How long is a quarter? Six months if you’re Reliance Jio
• India’s north-south divide is major political problem

Good Morning!

The Singapore-traded SGX Nifty, an early indicator of NSE Nifty 50 Index’s performance in India fell 0.36 percent to 10,550 as of 6:30 a.m.

A weaker yen supported Japanese equities at the start of Tuesday trading after the dollar climbed while investors maintained focus on the U.S. Treasury market, where the 10-year note flirted with 3 percent.

These are some important events coming up this week:

• French President Emmanuel Macron continues a three-day visit to the U.S.
• U.S. GDP and jobless claims.
• Earnings season continues. Among those reporting: Amazon.com, Samsung and Credit Suisse.
• The European Central Bank has a rate decision on Thursday. Investors will watch for any sign that officials are preparing a shift in stimulus plans for their June meeting.
• Bank of Japan announces its latest policy decision Friday and releases a quarterly outlook report.

Commodities

• West Texas Intermediate crude rose 0.6 percent to $69.05 a barrel.
• Gold was at $1,325 an ounce after slipping 0.9 percent.