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All You Need To Know Going Into Trade On April 9
Stocks in the news, big brokerage calls of the day, complete trade setup and much more!
09 Apr 2020, 08:55 AM IST 
Morning commuters walk in the Shiodome business area in Tokyo, Japan. (Photographer: Toru Hanai/Bloomberg)
Asian markets have opened mixed this Thursday morning after a three day rally. Investors are mulling the spread of Covid-19 and the ramping up of economies once things return to normal.
Oil prices have risen after Algeria confirmed that an emergency meeting of the OPEC+ will be held today to discuss an output cut of 10 million barrels per day.
The Singapore-traded SGX Nifty, an early indicator of NSE Nifty 50 Index’s performance in India, rose 0.17 percent to 8,873 as of 7:10 a.m.
Short on time? Well, then listen to this podcast for a quick summary of All You Need To Know before the opening bell.
Here’s a quick look at all that could influence equities today
- Japanese markets are trading with losses while those in Australia and South Korea trade higher.
- The S&P 500 futures edge higher after the benchmark rose 3.4 percent on Wednesday, taking its rise from the March low to over 20 percent.
- Top health advisers of the White House are developing a medical criteria for safely reopening the U.S. economy in the coming weeks if the trends hold steady.
- Total Coronavirus cases in Italy and Spain rose on Wednesday after several days of decline.
- Yield on the 10-year treasury was flat at 0.78 percent
- West Texas Intermediate crude trades 5.4 percent higher at $26.44 per barrel. A spokeswoman of the Russian Energy Ministry said that the nation will commit to cuts based on its proportion of the total production.
Get your daily fix of the global markets here.
Stocks To Watch
- Titan: The company in its fourth quarter business update expects revenue to contract. The lockdown in March wiped off gains made by India's largest branded jewellery maker in the previous two months, it said in a statement. Sales from the Jewellery segment, which accounts for 80 percent of the consolidated revenue fell five percent compared to last year. Watches and wearables saw a 1 percent growth despite Covid-19.
- Marico: The company expects a low single-digit decline in its domestic volumes for the quarter ended March as business was disrupted on account of the Covid-19 outbreak and a subsequent nationwide lockdown. Saffola has done well but Parachute and Value-added Hair Oil continue to see weakness, the company said.
- IDBI Bank: The board has approved a rupee bond borrowing limit of Rs 7,500 crore for the fiscal year 2021. It also gave in-principle approval to sell the bank’s stake in IDBI Federal Life Insurance to the extent of 23 - 27 percent.
- Hindalco Industries: Novelis has received approval from the European Commission for sale of the Duffel facility of Aleris to Liberty House Group for €310 million ($337 million). The facility has a capacity of 200kt of which 100kt was automotive line with the balance being in building construction, distribution, commercial transportation and others.
- Kolte-Patil: The company sold a portion of its land in Pune to Planet Smart City - a U.K.-based real estate developer for Rs 91 crore. The 5.42 acre land has a development potential of 7.6 lakh square feet in terms of saleable area and will be jointly developed by Kolte-Patil's subsidiary and Planet Smart City on a profit sharing basis.
- Gujarat Pipavav Ports: The company in its March quarter update has shared that the cargo volume handled fell 10 percent at 197,000 TEUs (Twenty-foot Equivalent Unit).
- Punjab & Sind Bank: The board will consider raising Rs 1,500 crore via QIP and preferential issue on April 15.
- Future Group: Said to tap UBS to sell stake in insurance joint venture, as reported by Bloomberg News.
- Astron Paper & Board Mill: Has received permission from the Government of Gujarat regarding the commencement of production for its unit located at Bhuj. The company’s product kraft paper is used in the manufacturing of corrugated boxes for industries like FMCG, pharma, food oil, etc. as the means of a packaging solution.
- NLC India: Mining operations of Neyveli mines have begun from April 8.
Brokerage Radar
Macquarie On SBI Cards
- Outperform rating maintained
- Price target cut to Rs 775 from Rs 1,025
- Covid-19 is a black swan event for India's credit card industry
- Discretionary spends have come to a complete halt in the near-term
- Expect FY21 NPLs at 6 percent and provisions at 13 percent
- No problem on funding and capital adequacy
HSBC On UPL
- Buy rating maintained
- Price target cut to Rs 450 from Rs 680
- Covid-19 remains a blind spot for now
- Disruption in FY21 may not be as grave as it appears
- Expect a comfortable cash flow position
- Current valuations attractive even on low earnings
PhillipCapital On ITC
- Upgrade to buy from neutral
- Price target cut to Rs 200 from Rs 215
- Underperforming for ages due to ESG norms, challenges in cigarette business and capital misallocation perceptions
- FMCG business showing much-needed promise of value creation
- Do not see capital misallocation
- Inexpensive consumer stocks are the best place to park money
BOBCAPS On Bajaj Finance
- Buy rating maintained
- Price target cut to Rs 3,000 from Rs 5,200
- Expect Covid-19 crisis to disrupt credit growth in FY21
- Lenders turn cautious and customers pare discretionary spends
- Growth may taper to 11 percent in FY21 and may normalise only by H2FY22
- Pricing power and spreads should remain stable
- Expect higher opex and delinquencies in next 12-15 months
HSBC On Aviation
- Restrictions and a sharp drop in demand have compelled Indian carriers to cut capacity
- Government support, cost cutting, liquidity are key
- Heading for a big loss in FY21; cash remains the key
- Maintain hold rating on Interglobe Aviation; price target cut to Rs 1,015 from Rs 1,145
- Downgrade Spicejet to hold from buy; price target cut to Rs 44.5 from Rs 90
HSBC On Voltas
- Downgrade to hold from buy
- Price target cut to Rs 545 from Rs 730
- Covid-19 and measures to contain it will have a material impact on discretionary spending and investments
- Medium-term outlook for discretionary room AC segment as well as for investment-driven projects business is weak
Morgan Stanley On Cement
- Demand disruption can outlast supply side challenges
- New capacity to keep prices under check
- See sharp decline in earnings in FY21
- Valuation multiples can test historical troughs
- Downgrade Ultratech to equalweight from overweight; price target cut to Rs 3,425 from Rs 4,600
- Upgrade Ambuja to overweight from equalweight; price target cut to Rs 186 from Rs 200
Bulk Deals
- Tata Communications: East Bridge Capital Master Fund acquired 44 lakh shares (1.54 percent) and University of Notre Dam acquired 15 lakh shares (0.53 percent), at Rs 235 per share, respectively. Fidelity Group sold 78.94 lakh shares (2.77 percent) at Rs 235.01 per share.
- Mangalam Cement: India Capital Fund sold 7 lakh shares (2.62 percent) at Rs 150 per share.
- Tourism Finance Corporation of India: Sageone Investment Advisors sold 6.6 lakh shares (0.82 percent) at Rs 37.27 per share.
- Sobha: Anamudi Real Estates acquired 5.58 lakh shares (0.59 percent) at Rs 168.71 per share. Anamudi Real Estates in a promoter entity of Godrej Group.
Pledged Share Details
- Adani Transmission: Promoter SB Adani Family Trust revoked pledge of 97.6 lakh shares on April 7
- Jindal Steel & Power: Promoter OPJ Trading released pledge of 3.19 crore shares on April 8
(As Reported On April 8)
Who’s Meeting Whom
- Mahindra & Mahindra to meet Nomura Securities and Blackrock Asia on April 9
- Affle India to meet Matthews Asia, Helios Capital Management and Malabar Investments on April 9
Trading Tweaks
- Price Band Revised From 10 Percent To 20 Percent: Tata Motors, Aditya Birla Capital, Adani Gas, Apex Frozen Foods, Apollo Pipes, Arvind, Avanti Feeds, Ashoka Buildcon, BEML, Balaji Amines, Aditya Birla Money, Dalmia Bharat, DCB Bank, Finolex Industries, IFB Industries, ICICI Securities, India Cements, IIFL Wealth Management, Inox Leisure, ITD Cementation, Kolte Patil Developers, Nippon Life AMC, NBCC, Prestige Estates Projects, Rain Industries, Shoppers Stop, Sonata Software, Strides Pharma, Sunteck Realty, Tata Elxsi, VIP Industries.
- Price Band Revised From 10 Percent To 5 Percent: Jubilant Life Sciences, Lumax Industries, Phillips Carbon Black, Titagarh Wagons, Wockhardt.
- Price Band Revised From 5 Percent To 10 Percent: CG Power and Industrial Solutions, Hubtown, ITDC, State Trading Corporation of India, Take Solutions.
- To Move Into ASM Framework: Manali Petrochemicals, OnMobile Global, Future Consumer.
- To Move Into Short Term ASM Framework: Emami, Dishman Carbogen Amcis, Procter & Gamble, IG Petrochemicals, Quick Heal Technologies.
Insider Trading
- Graphite India promoter Emerald Company acquired 1.15 lakh shares on March 31
- Patel Engineering promoter Praham India acquired 2.06 crore shares on March 26
(As Reported On April 8)
Money Market Update
- The rupee ended at a record low of 76.34 against the U.S. Dollar as compared to Tuesday's close of 75.63. It was the second straight day of weakness for the local currency.
F&O Cues
- Nifty April futures closed at 8750.5, a premium of 1.8 points versus 83.6 points
- Nifty April futures open interest down 2.5 percent, sheds 2.3 lakh shares
- Nifty Bank April futures closed at 18,889.5, discount of 57 points versus premium of 109.5 points
- Nifty Bank April futures open interest fell 1.5 percent, shed 15,000 shares
- Nifty Put-Call Ratio at 1.30 versus 1.45 across all series
Nifty: April 9 Expiry
- Maximum open interest on Call side at 9,000 strike (15.7 lakh shares)
- Maximum Open Interest on Put side at 8,000 strike (18.6 lakh shares)
- Open interest addition seen in 8,700 Put (4.7 lakh shares), 8,900 Call (4.6 lakh shares) and 9,000 Call (4 lakh shares)
- Open interest shedding seen in 8,400 Put (2.5 lakh shares) and 8,300 Put (2.5 lakh shares)
Nifty Monthly Expiry: April 30
- Maximum Open Interest on Call side at 9,000 strike (15.4 lakh shares)
- Maximum Open Interest on Put side at 8,000 strike (23.1 lakh shares)
