Men look at an electronic ticker board and an electronic screen that indicate stock figures at the Bombay Stock Exchange (BSE) in Mumbai, India. (Photographer: Prashanth Vishwanathan/Bloomberg)

Stocks To Watch: RCom, Hindalco, ITC, JSW Steel, Tata Steel

  • ArcelorMittal transfers Rs 7,000 crore to SBI account to become eligible for Essar Steel bid.
  • Reliance Communications admitted to insolvency proceedings by NCLT bench.
  • Nifty earnings to watch: Hindalco, ITC, Tata Steel

Stocks in Asia followed their American counterparts lower as geopolitical developments and rising benchmark U.S. yields spurred a return of risk aversion. Equities in Japan and Korea were lower after U.S. stocks halted a four-day rally with the steepest slide in almost two weeks. Australian shares bucked the trend.

The Singapore-traded SGX Nifty, an early indicator of NSE Nifty 50 Index’s performance in India, traded 0.7 percent lower at 10,750.50 as of 7:35 a.m.

Stock To Watch In Wednesday’s Trade

  • ArcelorMittal transfers Rs 7,000 crore to SBI account to become eligible for Essar Steel bid.
  • Reliance Communications admitted to insolvency proceedings by NCLT bench.
  • EPC Industries to form joint venture with Israel’s Top Greenhouse.
  • Shree Pushkar acquired 40,000 sq mtr land at MIDC, Ratnagiri for expansion purpose.

F&O Cues

  • Nifty May Futures closed trading at 10,818.6 with premium of 16.8 points versus 8 points.
  • All series-Nifty open interest down 2 percent and Bank Nifty open interest up 2 percent.
  • India VIX ended at 13.1, down 7.5 percent
  • Max open interest for May series at 11,000, open interest at 63.7 lakh, open interest up 4 percent.
  • Max open interest for May series at 10,500, open interest at 60.6 lakh, open interest down 9 percent.

F&O Ban

  • In ban: Dewan Housing, Jet Airways, JP Associates, Justdial, PC Jewelers, Wockhardt
  • New in ban: PC Jewellers
  • Out of ban: IRB Infra

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

Active Stock Futures

Bulk Deals

  • Reliance Communications: Sistema Shyam Teleservices sold 1.54 crore shares (0.6 percent) at Rs 12.63 each
  • Alok Industries: Catalyst Trusteeship sold 1.05crore shares (0.8 percent) at Rs 1.57 each

Nifty Earnings To Watch

  • Hindalco
  • ITC
  • Tata Steel

Other Earnings To Watch

  • AIA Engineering
  • Alembic Pharmaceuticals
  • Brigade Enterprises
  • GSFC
  • JK Lakshmi Cement
  • JSW Steel
  • Jyothy Laboratories
  • Muthoot Finance
  • NIIT
  • Praj Industries
  • Prataap Snacks
  • PTC India
  • Tasty Bite Eatables
  • Teamlease Services
  • TVS Motor Company
  • Welspun India
  • Zee Media

Earnings Reaction To Watch

PI Industries (Q4. YoY)

  • Revenue up 3 percent at Rs 625 crore.
  • Net profit down 22 percent at Rs 105 crore.
  • Ebitda down 12 percent at Rs 135 crore.
  • Margin at 21.6 percent versus 25.8 percent.

Monsanto India (Q4, YoY)

  • Revenue up 10 percent at Rs 157 crore.
  • Net profit up 66 percent at Rs 53 crore.
  • Ebitda up 50 percent at Rs 54 crore.
  • Margin at 34.4 percent from 25.2 percent.

Endurance Technologies (Q4, YoY)

  • Revenue up 29 percent at Rs 1,782 crore.
  • Net profit up 39 percent at Rs 116 crore.
  • Ebitda up 36 percent at Rs 258 crore.
  • Margin at 14.5 percent.

Ineos Styrolution India (Q4, YoY)

  • Revenue up 29 percent at Rs 510.5 crore.
  • Net profit up 7 percent at Rs 32 crore.
  • Ebitda up 17 percent at Rs 55.5 crore.
  • Margin at 10.9 percent from 12 percent.

Britannia Industries (Q4, YoY)

  • Revenue up 13 percent at Rs 2,537.5 crore.
  • Net profit up 25 percent at Rs 264 crore.
  • Ebitda up 29 percent at Rs 396.5 crore.
  • Margin at 15.6 percent from 13.7 percent.

Crompton Greaves Consumer (Q4, YoY)

  • Revenue up 8 percent at Rs 1,126 crore.
  • Net profit up 32 percent at Rs 103 crore.
  • Ebitda up 27 percent at Rs 164 crore.
  • Margin at 14.6 percent from 12.3 percent.

Clariant Chemicals (Q4, YoY)

  • Revenue down 4 percent at Rs 244 crore.
  • Net profit down 75 percent at Rs 2 crore.
  • Ebitda down 45 percent at Rs 11 crore.
  • Margin at 4.5 percent from 7.9 percent.

Shakti Pumps (Q4, YoY)

  • Revenue down 22 percent at Rs 131 crore.
  • Net profit down 20 percent at Rs 9.6 crore.
  • Ebitda flat at Rs 23 crore.
  • Margin at 17.6 percent from 13.8 percent.

JHS Svendgaard Laboratories (Q4, YoY)

  • Revenue up 38 percent at Rs 38 crore.
  • Net profit down 84 percent at Rs 3 crore.
  • Tax credit of Rs 17 crore in base quarter.
  • Ebitda up 14 percent at Rs 4 crore.
  • Margin at 10.5 percent from 12.7 percent.

Who’s Meeting Whom

  • Mahindra Logistics to meet Ask Investments and DSP Blackrock from May 16 – 21.
  • Siemens to meet New India Assurance, GIC and Wellington Management Group from May 16 – 18.

Insider Trades

  • Apollo Hospitals promoter Indian Hospitals Corp acquired 10,184 shares on May 10.
  • Plastiblends India promoter Jyoti Kabra acquired 10,000 shares from May 9 – 10.
  • Bodal Chemicals promoter Suresh Patel acquired 2.97lakh shares on May 14.

(As reported on May 15)

Brokerage Radar

CLSA on Lupin

  • Maintained ‘Buy’, with a price target of Rs 1,000.
  • US business trades at attractive valuation of <2x FY19 sales.
  • FY19 is expected to be a challenging year and recovery is expected from March 2019 onwards.
  • High single digit price erosion expected in the current financial year.

Credit Suisse on Lupin

  • Maintained ‘Neutral’ with a price target of Rs 770
  • Weak FY19 outlook for Japan and the U.S., and margins keep us neutral.
  • FY19 sales growth guidance is for single digit growth.
  • Next key event is likely re-inspection of Goa and Indore plants in December quarter.

Credit Suisse on PNB

  • Downgraded to ‘Neutral’ from ‘Outperform’, cur price target to Rs 88 from Rs 188.
  • Capital depletion will lead to loan book contraction.
  • Could incur losses even in FY19 on residual fraud provisions.
  • PNB will likely need a Balance Sheet contraction to conserve capital.

Macquarie on CG Consumer

  • Maintained ‘Outperform’, with a price target of Rs 292.
  • The key positive takeaway was the operating margins expansion.
  • Revenue growth decent but lags peers.
  • Need to capitalize with new product offering.

Credit Suisse on CG Consumer

  • Maintained ‘Outperform’, with a price target of Rs 315.
  • Margin expansion continues to play out, led by lighting.
  • Go-to-market changes, potential new category entry are key drivers.
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