All You Need To Know Going Into Trade On Aug. 27
A boy cycles along a road in Amritsar, Punjab (Photographer: Dhiraj Singh/Bloomberg)

All You Need To Know Going Into Trade On Aug. 27

Asian stocks posted modest gains Tuesday as the erratic trade narrative turned hopeful, lifting U.S. equities. Shares climbed in Tokyo and Seoul, and were little changed in Sydney.

The Singapore-traded SGX Nifty, an early indicator of NSE Nifty 50 Index’s performance in India, rose 0.25 percent to 11,080 as of 7:30 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.

  • U.S. shares rose after President Donald Trump was positive on prospects for a trade deal and France’s Emmanuel Macron said things were moving forward between the U.S. and China.
  • The S&P 500 Index closed near session highs in a broad-based rally, though volume was almost 20 percent below average.
  • Oil recovered losses and gold was steady.
  • Heads- up, the second reading of Q2 U.S. GDP Thursday is expected to refine estimates of slightly lower economic growth.

Get your daily fix of global markets here.

Also read: Trump Shifts Tone on China But Not Tactics as Deal Grows Distant

Brokerage Radar

CLSA on Indian Telecom

  • Sector revenues growing with rising 4G penetration.
  • Data adoption a long-term revenue driver.
  • Change in leadership; yet tariff hike uncertain.
  • Peak capex and gearing behind.

UBS on Apollo Tyres

  • Maintain 'Buy'; cut target price to Rs 200 from Rs 275.
  • Expect free cash flows trajectory to turn positive from financial year ending 2022.
  • Indian growth to improve in financial year ending 2021 as capacity come on stream.
  • Company targeting €1 billion annual revenue in Europe by financial year 2023-24.

JPMorgan on UPL

  • Initiated 'Overweight' with target price of Rs 700.
  • Synergies from Arysta to help drive higher than industry average growth.
  • Earnings execution remains the key for deleveraging over the next two years.
  • Financial year ending 2020 started as tough year but shows the strength of UPL’s business.

JPMorgan on Oil & Gas

  • HPCL: Upgraded to 'Neutral' from 'Underweight'; hiked target price to Rs 260 from Rs 220.
  • Low oil price environment offers marketing earnings stability in HPCL.
  • Petronet LNG: Upgraded to 'Overweight' from 'Underweight'; hiked target price to Rs 285 from Rs 207.
  • Petronet’s de-rating on cash deployment worries and competition is overdone.
  • Petronet offers combination of earnings and cash flow visibility.

Morgan Stanley on Coffee Day Enterprises

  • Maintained 'Overweight'; cut target price to Rs 140 from Rs 325.
  • Disclosure on cash and potential asset sale to unlock value could drive material stock upside.
  • See favourable risk-reward which drives overweight rating.

Citi on NMDC

  • Downgraded to 'Neutral' from 'Buy'; cut target price to Rs 80 from Rs 120.
  • Uncertainty on mines an overhang; Lower financial year 2020-21 volumes.
  • See lower ore prices, muted steel demand and shakiness in global prices.

HSBC on BHEL

  • Upgraded to 'Buy' from 'Hold'; cut target price to Rs 60 from Rs 62.
  • Continue to see near-term weakness in business fundamentals.
  • Steep stock price correction coupled with balance sheet strength and long-term potential makes for an upgrade.

Also read: RBI To Transfer A Record Surplus Of Rs 1.76 Lakh Crore To The Government

Indian ADRs

All You Need To Know Going Into Trade On Aug. 27

Stocks To Watch

  • Reliance Nippon Life Asset Management: Nippon Life Insurance increased its stake by 10.59 percent to 53.46 percent. As per the press release, Nippon will continue to run the company and its operations without any change in its structure and management.
  • Pidilite Industries has entered into joint venture with engineering technologies company Chetana. The JV company will be responsible to deploy technology in the field of Post Compressed Aerated Concrete Wall Panels in projects in India, Sri Lanka and Bangladesh. The company shall be the majority partner in this JV.
  • Bank of Baroda: Board approved issuance of bonds aggregating Rs 2,150 crore.
  • Kajaria Ceramics: Board approved merger of wholly-owned arm Kajaria Tiles with the company.
  • Strides Pharma Science to be excluded in F&O Segment with effect from Nov. 1.
  • LIC Housing Finance: Fidelity Group reduced stake in the company from 9.76 percent to 3.14 percent on Aug. 22.
  • Sastasundar Ventures: Mitsubishi Corporation signed an agreement to invest Rs 100 crore in company’s digital healthcare platform.
  • HDIL to appeal against National Company Law Tribunal order, after the tribunal passed on order to admit the company under Insolvency and Bankruptcy Code proceedings.
  • Excel Crop Care to be suspended from trading with effect from Aug. 29, due to composite scheme of amalgamation. The company will be amalgamated into Sumitomo Chemical India Limited.
  • Kingfa Science & Technology has started trial production of its new factory in Pune.
  • IL&FS Transportation Networks defaulted in payment of non-convertible debentures interest aggregating to Rs 2.3 crore, which was due on Aug. 26.
  • Vadilal Enteprises: Care Ratings downgraded long term bank facilities to ‘BBB’ from ‘BBB+’.
  • Bajaj Hindusthan Sugar: All 13 lenders signed the inter-creditor agreement for the resolution of the company’s debt. The company has got a standstill of 180 days and the required resolution plan needs to be implemented as per RBI rules during the said time period.
  • Kamdhenu Paints has re-opened its paint’s production facility in Rajasthan.

TRAI Data

  • Bharti Airtel: Telecom operator’s revenue market share increases for the first time in last five quarters to 30 percent.
  • Reliance Jio’s revenue market share increases, but a slower pace. The Mukesh Ambani-promoted company is now the largest telecom operator in India with market share of 31.7 percent
  • Vodafone Idea’s revenue market share slipped to 28 percent

Also read: India Considers Easing Sourcing Rules That May Help Apple

Pledge Share Details

  • Sun Pharma promoter Shanghvi Finance created pledge of 50 lakh shares on Aug. 22.
  • Kalaptaru Power Transmission promoters created pledge of 49 lakh shares on Aug. 23.
  • JSW Steel promoter group created pledge of 1.41 crore shares on Aug. 20.
  • Asian Paints promoter Rayirth Holdings revoked pledge of 10 lakh shares and created pledge of 7.6 lakh shares from Aug. 21-28.
  • Emami promoter groups created pledge of 6.25 lakh shares on Aug. 21.

Trading Tweaks

  • Alembic record date for demerger.
  • Mawana Sugars, Sanwaria Consumer to move into ASM Framework.
  • R.P.P. Infra Projects, 63 Moons Technologies to move into short term ASM Framework.
  • Birla Cable, Omax Autos, Websol Energy System to move out of short term ASM Framework.
  • Gallantt Ispat price band revised to 10 percent.
  • CG Power and Industrial Solutions, GFL, Unitech price band revised to 5 percent.

Who’s Meeting Whom

  • Cipla to meet Kotak Institutional Equities, ICICI Securities and other investors from Aug. 27-30.
  • Greaves Cotton to meet HDFC Securities on Aug. 27.
  • Thyrocare Technologies to meet Saif Partners on Aug. 27.
  • MCX to meet ICICI Pru Life Insurance on Aug. 27.
  • Eris Lifesciences to meet Franklin Templeton MF on Aug. 27.
  • Mahindra Logistics to meet Emkay Global on Aug. 27.

Insider Trading

  • JSW Steel promoter Vividh Finvest acquired 6.5 lakh shares from Aug. 20-21.
  • Usha Martin promoter Peterhouse Investments sold 2 lakh shares from Aug. 20-22.
  • Vodafone Idea promoter group Pilani Investment acquired 25 lakh shares on Aug. 22.
  • MEP Infra Developers promoter Anuya Mhaiskar acquired 4.35 lakh shares from Aug. 22-23.
  • Lemon Tree Hotels promoters acquired 19 lakh shares from Aug. 22-23.
  • Spencer’s Retail promoter group Castor Investments acquired 1.5 lakh shares from Aug. 22-23.

Money Market Update

  • The rupee hit the lowest in nine months to close at 72.02/$ versus 71.66/$ on Friday.

Also read: Rupee Falls Below 72-Mark Against Dollar On Currency Rout

F&O Cues

Futures

  • Nifty August futures closed at 11,054, discount of 3.6 points versus premium of 13.4 points
  • Nifty futures across series open interest up 1 percent, adds 1.5 lakh shares in OI.
  • Bank Nifty futures closed at 27,921.5, discount of 29.8 points versus premium of 57 points.
  • Bank Nifty futures open interest across series down 7 percent, sheds 1.3 lakh shares in OI.
  • Rollovers: Nifty 24 percent, Nifty Bank 23 percent.


Options

  • Nifty PCR unchanged at 1.20 versus 1.02 (across all series).

Nifty Monthly Expiry Aug. 29

  • Max open interest on call side at 11,000 (31.5lakh shares).
  • Max open interest on put side at 11,000 (34.4lakh shares).
  • Open interest addition seen at 10,900P (+13.4lakh shares), 11,000P (+10.5lakh shares).
  • Open interest shedding seen at 11,000C (-14.5lakh shares), 10.900C (-8.4lakh shares).
All You Need To Know Going Into Trade On Aug. 27
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