A visitor uses a smartphone in front of an electronic ticker screen displaying current share prices in the reception of the Hellenic Exchanges - Athens Stock Exchange SA in Athens, Greece. (Photographer: Yorgos Karahalis/Bloomberg)

All You Need To Know Going Into Trade On Feb. 14

Asian stocks saw mixed trading Thursday as investors awaited the outcome of high-level trade talks between the U.S. and China, and data on the Chinese economy.

Shares posted modest gains in Australia, fluctuated in Japan and slipped in Korea. Futures in Hong Kong pointed lower. Mainland Chinese equities will be closely watched after the Shanghai Composite Index extended its rally from January lows to 10 percent.

The Singapore-traded SGX Nifty, an early indicator of NSE Nifty 50 Index’s performance in India, fell 0.25 percent to 10,776 as of 7 a.m.

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BQ Live

Here’s a quick look at all that could influence equities today.

U.S. Market Check

  • U.S. equities put in their fourth straight session of gains as optimism over trade negotiations countered some of the jitters that Senator Marco Rubio triggered when he announced a bill to tax buybacks on equal footing with dividends.
  • The yield on 10-year Treasuries was at 2.70 percent.

Asian Cues

  • Japan’s Topix index rose 0.3 percent.
  • Australia’s S&P/ASX 200 Index gained 0.5 percent.
  • Hang Seng Index futures fell 0.2 percent.
  • S&P 500 futures nudged 0.1 percent higher.

Also read: Trump Says China Trade Talks Going ‘Very Well’ Ahead of Deadline

Commodity Cues

  • Brent crude gained for the third day, up 0.38 percent to $63.85 per barrel.
  • West Texas Intermediate crude climbed 0.3 percent to $54.04 a barrel.
  • Gold stabilized around $1,307.05 an ounce.

Also read: It’s All Going Wrong Again for OPEC: Oil Strategy

London Metal Exchange

  • Aluminium ended lower for the sixth day, down 0.05 percent.
  • Tin ended a two-day decline, ended 0.84 percent higher.
  • Zinc ended lower for the fourth day, down 0.42 percent
  • Copper halted a four-day decline, ended 0.3 percent.
  • Nickel ended lower for the fourth day.
  • Lead ended lower for the third day, down 0.74 percent.

Key Events/Data To Watch This Week

  • 12 p.m.: India January Wholesale Prices Inflation YoY, Bloomberg estimates at 3.7 percent, prior 3.8 percent.
  • Steven Mnuchin and Robert Lighthizer are in Beijing for high-level talks, and will meet China President Xi Jinping on Friday, the South China Morning Post reported.
  • China’s exports probably fell again in January from a year earlier, but at a slower pace than in December.

Also read: Economic Data Woes in India Prompt Call for Independent Verifier

Indian ADRs

All You Need To Know Going Into Trade On Feb. 14

Stocks To Watch

  • Yes Bank received the Reserve Bank of India’s compliance assessment report for 2017-18. The report states that there is no divergence in asset classification and provisioning as per the RBI norms.
  • Ludlow Jute & Specialities, Cheviot: Cabinet approved raising MSP for raw jute by Rs 250 per quintal, or 6.75 percent, to Rs 3,950 per quintal for 2019-20.
  • InterGlobe Aviation said that 49 flights were cancelled on Feb. 13. The airline company said that it has decided to curtail its schedule for the remaining period of February by approximately 30 flights a day to stabilise its operation and adjust its crew rosters due to anticipated weather conditions.
  • Trident was granted the patent for ‘Air Rich Yarn and Fabric and its method of manufacturing’ by the U.S. Patent and Trademark Office.
  • HIL said that the company commenced the second phase production of its soil, waste and rain pipes and fittings at its Gujarat plant. The additional capacity of 5250 MTPA will be added to this plant under the new phase of production.
  • ABB India approved the segregation of company’s power grid business from the company’s other businesses.
  • Dewan Housing Corporation’s Harshil Mehta resigned from the post of whole-time director (designated as Joint MD and CEO) with effect from Feb. 13. But the company stated that he will continue to be the executive president of the retail business from Feb. 14 onward.
  • Fortis Healthcare appointed Vivek Kumar Goyal as CFO. The company says that the effective date of appointment shall be on or before May 1. The board also stated that Dr Ashutosh Raghuvanshi will become the CEO of the company with effect from March 18.
  • Tata Power, in collaboration with AES and Mitsubishi Corporation, set up a 10MW energy storage system in Delhi. This system will provide better peak load management and system flexibility, the company said.
  • IndusInd Bank approved establishing of euro medium term notes program for $1 billion. This program will provide the bank access to foreign currency funds and it will be listed on the Singapore Stock Exchange. The board also stated that it will raise up to Rs 3000 crore via debentures. The Bank will also participate in the rebidding process for IL&FS Securities.
  • PSP Projects emerged as the lowest bidder for two construction projects in Rajasthan and Gujarat with a cumulative contract value of Rs 415.2 crores.
  • Tata Group’s R. Venkataraman sought to relinquish his responsibilities as managing trustee of Tata Trusts on March 31. A panel of trustees has been setup to select the new chief executive.
  • Pidilite Industries’ global arm set up a join venture in Kenya with Crown Classic. The Global arm will hold 55 percent of the stake in the JV, while the remaining stake will be held by Crown Classics.
  • EID Parry, Balrampur Chini, Dhampur Sugar: Government may raise minimum selling price of a sugar by as much as 10 percent from Rs 29 per kg to Rs 32 per kg, a government official said.
  • JSW Steel: Committee of Creditors of BPSL issued a Letter of Intent to JSW Steel. The closure of the transaction shall be subject to obtaining necessary approval from NCLT and satisfaction of conditions precedent under the resolution plan.

Also read: Bank Of Baroda Initiates Forensic Audit Of DHFL Loans

Nifty Earnings To Watch

  • Oil & Natural Gas Corporation

Other Earnings To Watch

  • Ashok Leyland
  • JK Tyre & Industries
  • Infibeam Avenues
  • GlaxoSmithKline Consumer Healthcare
  • Glenmark Pharmaceuticals
  • Voltas
  • Williamson Magor
  • GMR Infrastructure
  • GVK Power & Infrastructure
  • Eveready Industries
  • Sadbhav Engineering
  • Finolex Cables
  • La Opala RG
  • APL Apollo Tubes
  • Shree Renuka Sugars
  • United Breweries
  • Sreeleathers
  • Apollo Tricoat Tubes
  • Bharat Dynamics
  • Bharat Rasayan
  • Cerebra Integrated Technologies
  • Cox & Kings
  • Dalmia Bharat Sugar and Industries
  • Deepak Fertilizers and Petrochemicals Corporation
  • Mcleod Russel
  • Mishra Dhatu Nigam
  • National Peroxide
  • Nesco
  • Nestle India
  • Forbes & Company
  • Gabriel India
  • Texmo Pipes and Products
  • Housing Development and Infrastructure
  • IFCI
  • India Glycols
  • India Tourism Development Corporation
  • Kaveri Seed Company
  • Kitex Garments
  • Kohinoor Foods
  • Liberty Shoes
  • Mahanagar Telephone Nigam
  • Orient Refractories
  • S Chand And Company
  • Vipul

Also read: Why Shares Of CG Power Tumbled The Most Since Listing

Earnings Reaction To Watch

Gulf Oil Lubricants (Q3, YoY)

  • Revenue up 29.8 percent to Rs 462 crore.
  • Net profit up 17.2 percent to Rs 49.8 crore.
  • Ebitda up 18.7 percent to Rs 73 crore.
  • Margin at 15.8 percent versus 17.3 percent.
  • Declared dividend of Rs 4.5 per share.

Fortis Healthcare (Q3, YoY)

  • Revenue down 1.6 percent to Rs 1103.3 crore.
  • Net loss to Rs 197.1 crore versus net loss to Rs 36.8 crore.
  • Ebitda down 26.4 percent to Rs 38 crore.
  • Margin at 3.4 percent versus 4.6 percent.
  • Finance costs up 76 percent to Rs 111 crore.
  • Exceptional loss of Rs 127.7 crore due to impairment of goodwill and impairment of closure of one hospital facility.

Lemon Tree Hotels (Q3, YoY)

  • Revenue up 8.3 percent to Rs 143.4 crore.
  • Net profit up 38.9 percent to Rs 12.5 crore.
  • Ebitda up 14.7 percent to Rs 49.1 crore.
  • Margin at 34.2 percent versus 32.3 percent.

Oracle Financial Services (Q3, QoQ)

  • Revenue down 2.3 percent to Rs 1,185.9 crore.
  • Net profit down 13.1 percent to Rs 306 crore.
  • Ebitda up 0.2 percent to Rs 499.6 crore.
  • Margin at 42.1 percent versus 41.1 percent.
  • Other income of Rs 49.6 crore in base quarter

Quick Heal Technologies (Q3, YoY)

  • Revenue up 3.6 percent to Rs 65.9 crore.
  • Net profit up two times to Rs 16.1 crore.
  • Ebitda up 59.1 percent to Rs 21 crore.
  • Margin at 31.9 percent versus 20.8 percent.
  • Higher other expenses of Rs 24.4 crore in base quarter.
  • Other income up 73 percent to Rs 9 crore.

Prabhat Dairy (Q3, YoY)

  • Revenue up 14.6 percent to Rs 463 crore.
  • Net profit down 32.4 percent to Rs 10 crore.
  • Ebitda flat to Rs 37.5.
  • Margin at 8.1 percent versus 9.3 percent.
  • Stock purchases up 7 times to Rs 49.8 crore.
  • Decrease in inventory for Rs 27.5 crore.

NBCC (Q3, YoY)

  • Revenue up 29.3 percent to Rs 2,438.8 crore.
  • Net profit up 22.4 percent to Rs 83.6 crore.
  • Ebitda down 16.1 percent to Rs 70.8 crore.
  • Margin at 2.9 percent versus 4.5 percent.
  • Other Expenses up 66 percent to Rs 34 crore.

Reliance Capital (Q3, YoY)

  • Revenue down 11 percent to Rs 568 crore.
  • Net profit of Rs 89 crore versus net loss of Rs 603 crore.
  • Refund of expenses worth Rs 31 crore seen in December quarter as against an expense of Rs 676 crore incurred last year.

Bulk Deals

  • SREI Infra Finance: Norges Bank acquired 30.15 lakh shares or 0.60 percent equity at Rs 25.29 each.
  • Zee Media Corporation: IFCI sold 30 lakh shares or 0.64 percent equity at Rs 14.07 each.
  • Teamlease Services: Goldman Sachs AMC sold 90,500 shares or 0.53 percent equity at Rs 2,898.2 each.

Trading Tweaks

  • Coal India, Indian Energy Exchange ex-date for share buyback.
  • Jindal Stainless to move into short term ASM Framework.
  • Mangalam Drugs and Organics price band revised to 10 percent.

Who’s Meeting Whom

  • Blue Star to meet Philip Capital, Equiries Securities and other investors on Feb. 18.
  • Thyrocare Technologies to meet Kayne Anderson Rudnick and Macqurie Capital Services on Feb. 14.
  • Inox Leisure to meet Spark Capital Advisors and BOB Capital Markets on Feb. 15
  • Crompton Greaves Consumer Electricals to meet Oppenheimer Funds, IDBI Life Insurance and other investors between Feb. 14-15.
  • Jubilant Lifesciences to meet Mirae MF, IIFL AMC and other investors between Feb. 14-15.

Insider Trading

  • Electrosteel Castings promoter group Electrocast Sales acquired 94,800 shares between Feb. 8-11.
  • MRF promoter Shirin Mammen sold 450 shares on Feb. 11.
  • Srikahasthi Pipes promoter GK & Sons acquired 58,400 shares in Feb. 11.
  • Bodal Chemicals promoter group Ramesh Patel acquired 34,700 shares on Feb. 11.

Money Market Update

  • The rupee on Wednesday snapped its six day rising streak and closed at 70.80/$. It closed at 70.66/$ on Tuesday.

Also read: Rupee's Unexpected Rally Showcases RBI's Pivot for India Markets

F&O Cues

  • Nifty February futures closed trading at 10823, premium of 30 points.
  • Max open interest for February series at 10,900 call (open interest at 21.7 lakh shares).
  • Max open interest for February series at 10,800 put, (open interest at 7.2 lakh shares).

Stocks In F&O Ban

In Ban

  • IDBI
  • Jet Airways
  • Reliance Capital
  • Reliance Infrastructure

New In Ban

  • Jain Irrigation

Out Of Ban

  • DHFL

Put-Call Ratio

  • Nifty PCR at 1.29 versus 1.35.
  • Bank Nifty PCR at 0.72.
All You Need To Know Going Into Trade On Feb. 14

Brokerage Radar

CLSA on Bharat Forge

  • Maintained ‘Sell’ with a price target of Rs 420.
  • Good quarter, but weak outlook.
  • See cyclical pressures ahead.
  • Fall in commodity prices poses risk to industrial exports.

CLSA on J Kumar Infra

  • Maintained ‘Buy’ with a price target of Rs 315.
  • December quarter review: Net profit ahead; execution and new orders see upgrades.
  • Triggers: resolution of SEBI issue, marked pick-up in execution and resumption of order inflow.
  • Inexpensive play on high-growth urbanisation Capex.

Macquarie on Yes Bank

  • Maintained ‘Outperform’ with a price target of Rs 270.
  • Nil divergence – a very big positive; a significant overhang disappears.
  • Reinforces our conviction that asset quality is fine.
  • Focus now moves to the new CEO.

JPMorgan on Fortis Healthcare

  • Maintained ‘Overweight’ with a price target of Rs 180.
  • Ebitda impacted by one-offs; Hospital margin recover but SRL growth remains sluggish.
  • Completion of IHH deal and RHT asset acquisition will shift focus on the medium-term turnaround plan.
  • Expect one-offs to impact near-term results, but margin trend to build confidence on earnings.

UBS on Indian Energy Exchange

  • Initiated ‘Buy’ with a price target of Rs 215.
  • Attractive on all counts; See catalysts for both near and long term.
  • Key growth drivers are backed by structural changes.
  • Multiple other levers could aid earnings and lead to high option value.

UBS on Bosch

  • Maintained ‘Sell’ with a price target of Rs 15,500.
  • December quarter review: Weak core performance; Net profit supported by other income.
  • Do not expect BS-VI to be game changer.
  • Management remains cautious on Q4 demand as dealer inventory levels were high.

HSBC on Indian AMCs

  • Fund industry is growing strongly and has great potential.
  • Sector continues to benefit from shifts in savings patterns.
  • Biggest disruption for the industry could be in distribution.

HSBC on Reliance Nippon

  • Initiated ‘Buy’ with a price target of Rs 217.
  • Well positioned to grow in more profitable equity segment.
  • Distribution is core strength for the group.
  • Inter-corporate deposits are a concern.

HSBC on HDFC AMC

  • Initiated ‘Hold’ with a price target of Rs 1,300.
  • Quality franchise with an individual focus.
  • Will be more impacted by TER cut than RNAM.
  • Valuations appear full; Dividend pay-out ratio lower than RNAM.