All You Need To Know Going Into Trade On December 17
Asian markets are mixed at the start of trade this morning. Investors are mulling speculations that U.S. lawmakers are edging closer to a stimulus deal.
Benchmark indices in Japan and South Korea are declining while those in Australia trade with gains.
The U.S. Federal Reserve promised to maintain its asset purchase program until it sees 'substantial further progress' in employment and inflation.
The Singapore-traded SGX Nifty, an early indicator of the Nifty 50 Index’s performance in India, was little changed at 13,685 as of 6:55 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.
Let’s take a look at the factors that may influence equities in today’s session:
- Futures on the Dow Jones are trading with gains of 20 points. The index ended with a negative bias on Wednesday.
- Senate Majority leader Mitch McConnel said that leaders are still talking about fresh aid but believes that "We are going to get there."
- Fed Chair Jerome Powell said that the case for fiscal stimulus is 'very, very strong.'
- “The 12-month outlook looks quite a bit better, because we have high conviction now that there is going to be mass vaccination,” Brian Nick, chief investment strategist at Nuveen, said on Bloomberg TV. “There’s not going to be as acute of a health crisis as we’re experiencing right now.”
- Yield on the 10-year treasuries remained at 0.92% after the Fed meet disappointed some traders who expected changes to its bond buying program.
- West Texas Intermediate crude remained flat at $47.82 per barrel. Bitcoin crossed the mark of $20,000 for the first time.
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Stock To Watch
- Hero MotoCorp: To increase the prices of its products by up to Rs 1,500 from January 1, 2021. The increase will vary across models. Steady rise in commodity costs including steel, aluminium cited as the reason behind price hikes.
- Wipro: The company has completed the acquisition of 83.4% equity stake in Encore Theme. The remaining 16.6% equity stake will be acquired subject to and after receipt of certain regulatory approvals/confirmations.
- IndusInd Bank: SEBI has granted extension of one month for subscription to the warrants i.e., until February 4, 2021 to complete the said conversion worth Rs 2,021.44 crore into equity. In view of the disruption caused by the Covid- 19 pandemic, the bank had, at the request of IIHL and IL, approached SEBI for extension in time for payment of balance amount.
- Navin Fluorine: The Board of Directors has approved capital expenditure for setting up a Multi-Purpose Plant with an outlay of Rs 195 crore. The capex will be undertaken by the company's wholly owned subsidiary, Navin Fluorine Advanced Sciences Ltd. at Dahej, Gujarat and will be funded through a mix of internal accruals and debt. The new capacity is expected to come onstream in H1FY23 and is aimed at creating new opportunities in the life sciences and crop sciences sectors.
- Snowman Logistics: The Board of Directors to consider a proposal for raising of funds by way of a Qualified Institutions Placement at its meeting on December 21.
- Computer Age Management Services: The company has been considered eligible for selection and further grant of registration as a Central Record Keeping Agency under the National Pension Scheme under the Pension Fund Regulatory and Development Authority Regulations, 2015. The selection is subject to fulfilment of certain conditions including the de-registration of the company as a Point of Presence.
- IRCTC: The Government of India has proposed to offer up to 16 lakh shares of face value of Rs 10 each to the eligible employees of the company at a price of Rs 1377.55 per share. The Employee OFS will remain open between December 18-21, 2020.
- Bombay Rayon Fashions: As part of the restructuring process, the company is in the process of hiving off its Tarapur Yarn Dying and Fabric Process unit to its subsidiary company BRFL Textiles under a slump sale consideration. Post this transaction, a set of Private Equity investors will infuse capital into BRFL Textiles, which will be utilised for funding the working capital for ramp-up of operations. The company expects the new entity to generate revenues worth over Rs 2,000 crore annually.
- Lakshmi Vilas Bank: The trading in the equity shares of the bank will be withdrawn (delisted) from December 18, 2020 pursuant to gazette notification dated November 25, 2020 issued by Department of Financial Services, Ministry of Finance.
- Aster DM Healthcare: The company through its subsidiary, Aster DM Healthcare FZC, has acquired a company in the Grand Cayman, Cayman Islands - Aster Caribbean Holdings.
- Videocon Industries: The Committee of Creditors has approved the resolution plan submitted by Twin Star Technologies Limited and the plan has been filed with the National Company Law Tribunal, Mumbai.
- Olectra Greentech: Evey Trans and Olectra Greentech have been declared as L-1 bidders for 353 electric buses from 5 state transport authorities and one state government undertaking, under the FAME-II scheme of Government. Tenders for 300 buses are on Gross Cost Contract/OPEX model basis for a period of 10-12 years and tenders for 53 buses are on an outright sale basis participated by the company alone. Value of these tenders is approximately Rs 600 crore.
- Jubilant FoodWorks: Has launched a new brand, Ekdum, which will offer twenty different biryanis curated from various parts of India. Ekdum will start with three restaurants in Gurgaon.
CLSA On Power Grid
- Buy rating maintained
- Price target raised to Rs 225 from Rs 215
- Remain confident of FY21 dividend estimate of Rs 11.5 per share
- Well on track o achieve capitalisation that is higher than its FY21 capex
- See little in the way of downside surprises to our 55% rise in estimated dividend, making it an attractive dividend yielding stock
- Attractiveness to ESG investors, inexpensive valuations and visible yield helps us maintain buy rating despite the recent rally
CLSA On Oil & Gas Sector
- India oil product demand fell in November while Asian GRMs slip further
- Market suggests a small QoQ decline in core GRM for oil refiners
- Reliance GRMs may be flat QoQ as light-heavy crude differentials remain narrow
- ONGC, Oil India continue to price in optimistic crude/gas realisations and hence we remain sellers
Ambit Capital On Indian I.T.
- Demand from cloud shifts, WHF enablement and app modernisation will be strong
- Funding from legacy cuts tempers growth optimism
- See cyclical uptick in FY22E and 7-8% trend growth post that
- Hard data evidence does not point to a pent-up recovery
- Prefer stocks that offer margin of safety on growth, margins and valuations
- Stock picks driven by strong new deal momentum, segmental skew towards growing or recovering segments and reasonable valuations
- Pecking order for buy recommendations: HCL Tech, Mphasis, Infosys and Tech Mahindra
Antique Stock Broking On Cement Stocks
- CCI event may be a near-term headwind
- Historically, CCI cases have a poor precedence of reaching a conclusion
- Cement pricing reversal in November-December after initial strength in October
- Operating profitability to remain healthy in Q3
- UltraTech continues to be the preferred pick in the largecap space
- Like Dalmia Bharat, Birla Corp, JK Lakshmi cement in the mid and smallcap space
- Recommend adding JK Cement on dips
Investec On India's Microfinance Industry
- Sector has come a long way, weathering multiple crisis
- Penetration, which has not been uniform, has scope to improve
- Large MFIs well placed to capitalise on group loan opportunity
- Individual loans another large opportunity for MFIs
- Remain buyers on CreditAccess Grameen and Equitas as they are working in accordance with curent trends
- Retain hold rating on Bandhan Bank due to near-term risks in West Bengal ahead of state assembly elections
Pledge Share Details
- Max Financial Services: Promoter Max Ventures Investment Holdings created a pledge of 2.16 lakh shares between December 3-15.
- Welspun Specialty Solutions: Promoter Welspun Steel created a pledge of 1.21 crore shares on December 14.
- Ajanta Pharma: Promoter Aayush Agrawal revoked pledge of 3.20 lakh shares on December 15.
As Reported On December 16
Who’s Meeting Whom
- Gland Pharma: To meet Franklin Templeton Investments on December 17.
- Welspun India: To meet Capital World Investors on December 17 and Kotak Mutual Fund on December 22.
- CSB Bank: Nomura Singapore bought 14.96 lakh shares (0.86%) at Rs 214.5 per share. AKENA sold 14.96 lakh shares (0.86%) at Rs 214.5 per share.
- JK Tyre: Edgefield Securities sold 14.65 lakh shares (0.60%) at Rs 77.76 per share.
- Snowman Logistics: Adani Logistics sold 9.70 lakh shares (0.58%) at Rs 59.51 per share.
- Majesco: Third Alpha LLP bought 2.35 lakh shares (0.79%) at Rs 977.81 per share.
- LT Foods: Frigorifico Allana bought 16.50 lakh shares (0.52%) at Rs 59.95 per share.
- Take Solutions: Intelent Data Sciences sold 7.50 lakh shares (0.51%) at Rs 50.28 per share.
- AGM: Omaxe, The Hi-Tech Gears, Nalwa Sons Investments, Modern Thread, Madhav Marbles and Granites, Asian Hotels (North).
- Ex-Date Interim Dividend: Hindustan Aeronautics, Power Grid Corporation Of India.
- Ex-Date Dividend: East West Holdings, Aarnav Fashions.
- Price Band Revised From 10% To 5%: Inox Wind, MSP Steel & Power, Suven Life Sciences.
- Price Band Revised From 20% To 10%: Burger King India.
- Move In To Short-term ASM Framework: Share India Securities, Cybertech Systems And Software, Filatex India.
- Move Out Of Short-term ASM Framework: ADF Foods, Lemon Tree Hotels, Sterling And Wilson Solar, Tejas Networks, Chalet Hotels.
- Mangalore Chemicals & Fertilizers: Promoter Akshay Poddar acquired 50,000 shares between December 14-15.
- Chambal Fertilisers: Promoters Jyotsna Poddar and Akshay Poddar acquired 40,000 shares on December 14.
- Godrej Agrovet: Promoter Godrej Industries acquired 46,696 shares between December 10-11.
- Godrej Industries: Promoter Anamudi Real Estates acquired 1.03 lakh shares between December 10-11.
- Great Eastern Shipping: Promoter Gopali Mulji sold 18,000 shares between December 14-15.
As Reported On December 16.
Money Market Update
- The rupee ended at 73.58 against the U.S. Dollar on Wednesday as compared to Tuesday's close of 73.65.
- Nifty December futures end at 13,696; premium of 14 points
- Nifty December futures add 6.3% and 7.4 lakh shares in Open Interest
- Nifty Bank December futures end at 30,743; premium of 45 points
- Nifty Bank December futures add 2.9% and 41,850 shares in Open Interest
- Nifty Put-Call Ratio at 1.92
- Enters F&O Ban: Punjab National Bank
- Stocks In F&O Ban: Canara Bank, Punjab National Bank
Nifty: December 17 Expiry
- Maximum Open Interest on Call side at 13,800 strike (33.4 lakh shares)
- Maximum Open Interest on Put side at 13,000 strike (36.7 lakh shares)
- Active Options: 13,600 Call (-15.1 lakh shares) and 13,600 Put (+24 lakh shares)
Nifty: December 31 Expiry
- Maximum Open Interest on Call side at 13,000 strike (23 lakh shares)
- Maximum Open Interest on Put side at 13,000 strike (42.7 lakh shares)