All You Need To Know Going Into Trade On March 15
Asian stocks were mostly higher Friday, building on this week’s gains despite concerns over a delayed U.S.-China trade deal.
Equities in Japan and Korea rose, were little changed in Australia and futures pointed to small declines when Hong Kong opens. The Singapore-traded SGX Nifty, an early indicator of NSE Nifty 50 Index’s performance in India, traded a little changed at 11,381.50 as of 6:50 a.m.
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Here’s a quick look at all that could influence equities today.
U.S Market Check
- U.S. stocks halted a three-day rally, while the dollar surged amid concern a trade deal with China remains elusive.
- The yield on 10-year Treasuries held at 2.63 percent.
- Japan’s Topix index rose 0.7 percent.
- Hang Seng futures earlier slipped 0.3 percent.
- Australia’s S&P/ASX 200 Index added 0.1 percent.
- South Korea’s Kospi gained 0.2 percent.
- Futures of S&P 500 gained 0.1 percent.
- Brent Crude traded a little changed at $67.21 per barrel.
- West Texas Intermediate crude slid 0.1 percent to $58.56 a barrel.
- Gold steadied at $1,295.99 an ounce after slumping 1 percent.
London Metal Exchange
- Nickel halted a two-day rally, ended 2.4 percent lower.
- Aluminium halted a two-day rally, ended 0.1 percent lower.
- Lead ended 0.73 percent lower after rallying for two days.
- Tin ended 0.09 percent higher.
- Copper halted a three-day rally, ended 1.1 percent lower.
- Zinc halted a three-day rally, ended 0.7 percent lower.
Key Events To Watch This Week
- China’s National People’s Congress is set to wrap up on Friday.
- Bank of Japan Governor Haruhiko Kuroda will speak on Friday, after he and his board conclude their discussions on monetary policy.
Stocks To Watch
- Coal India declared a dividend of Rs 5.85 per share, with record date set at March 25. This dividend will be 2nd interim dividend for financial year 2019. Date of Payment of this Interim Dividend is on or after March 29.
- Vedanta’s Zambia unit halted copper-shaft operations after the contractor failed to secure funds to pay workers. The contractor has failed in its efforts to secure funding from banks, as reported newspaper News Digger. (Bloomberg News).
- The SEBI ordered Religare Finvest Ltd. and Religare Enterprises Ltd. to recall loans worth over Rs 2,300 crore that were diverted to promoters Shivinder Mohan Singh, Malvinder Mohan Singh and 21 other entities after finding preliminary evidence of fund diversion.
- Reliance Industries sought to raise 150 million euros via debt instruments. (Bloomberg News)
- Delhi High Court stayed an order of National Anti-Profiteering Authority against Jubilant Foodworks and penalty proceeding, subject to deposit of Rs 20 crores on Central Consumer Fund.
- Hindustan Unilever: Sanjiv Mehta named president of Unilever South Asia with effect from May 1. He will continue to be CMD of HUL.
- The Reserve Bank of India categorized IDBI Bank as private sector bank with effect from Jan. 21, consequently upon LIC acquiring 51 percent of the total equity capital of the bank.
- Tech Mahindra’s arm acquired 100 percent stake in Japan’s K-Vision for $1.5 million. The target is engaged in providing network services for mobile communication carriers in Japan.
- Tide Water Oil declared a dividend of Rs 85 per share with March 25 as the record date.
- CMI said that it received vendor approval for power cables from four government entities for the third quarter of this financial year and expects the manufacturing capacity of its Himachal Pradesh plant to improve in 2019.
- Adani Transmission board said it will consider raising capital via NCDs on March 20.
- NCLT approved merger of Explosoft Tech Solutions with Axiscades Engineering.
- India Investment Trust, sponsored by Canadian investor Brookfield, will buy Mukesh Ambani’s privately owned East West Pipeline Ltd. for Rs 13,000 crore. RIL will have to offtake at least 22 MMSCMD of gas from this pipeline. If it fails to do so, then RIL will be liable to pay the differential amount to Pipeline Infrastructure. The amount payable by RIL will be the difference between Rs 500 crore per quarter and the actual revenue earned by Pipeline Infrastructure.
ICRA Revised The Rating Outlook Of Six PSU Banks
- IDBI Bank- From ‘Developing Implications’ to ‘Negative Outlook’ driven by the pressure on asset quality and credit provisioning.
- Bank of India- From ‘Negative’ to ‘Stable’ due expectations of profitable operations, reduced asset quality pressures and improving solvency levels in financial year 2020.
- Punjab National Bank- From ‘Negative’ to ‘Stable’ due to improvement in reduced asset quality pressure and a capital infusion of Rs 14,156 crore by the GOI.
- Oriental Bank of Commerce, Bank of Maharashtra- From ‘Negative’ to ‘Stable’
- Punjab and Sindh Bank- From ‘Stable’ to ‘Negative’ due to sizeable capital requirement, weak solvency levels and sustained losses expected in financial year 2020.
- Kotak Mahindra MF acquired 8 lakh shares or 0.6 percent equity at Rs 1,312.4 each.
- ICICI Pru AMC acquired 8.2lakh shares (0.6 percent equity at Rs 1,312.4 each.
- Promoter Jubilant Consumer sold 39.6 lakh shares (3 percent equity at Rs 1,312.4 each.
- Amansa Holdings acquired 33 lakh shares or 3.1 percent equity at Rs 351 each.
- FIL Capital Management (Mauritius) sold 61.2 lakh shares or 5.7 percent equity at Rs 351.2 each.
- Reliance MF acquired 2.3 lakh shares or 2.4 percent equity at Rs 2,877 each.
- Smallcap World Fund sold 2.3 lakh shares or 2.4 percent equity at Rs 2,877 each.
- ISGEC Heavy Engineering
- Canara Robeco Mutual Fund acquired 52,500 shares or 0.7 percent equity at Rs 5,499.8 each.
Pledge Share Details
- Max Financial Services promoter group Max Ventures Investment Holding creates pledge of 24.1 lakh shares on March 8.
- GTPL Hathway promoter Kanksinh Bhurubha Rana creates a pledge of 5.62 lakh shares.
(As reported on March 14)
- CESC Ventures to move into short term ASM Framework.
- LAKHP Finance price band revised to 5 percent.
Who’s Meeting Whom
- BSE to meet Wells Capital Management, Artisan Partners Asset between March 15-20.
- Gujarat Pipavav Port to meet Tata MF on March 15.
- Escorts to meet Mobius Capital Partners, Axiom International and other investors between March 15-26.
- Dr. Lal Pathlabs to meet Westbridge Capital and RBC Investment Management Asia between March 15-18.
- Bajaj Autos promoter Bajaj Holdings and Investment acquired 6.28 lakh shares between March 12-14.
- Zensar Technologies promoter group Sofreal Mercantrade acquired 23,000 shares between March 12-13.
- Jindal Stainless promoter Abhuday Jindal acquired 70,000 shares on March 13.
Money Market Update
- The rupee on Thursday strengthened for the fourth straight day and closed at its highest in eight months at 69.35/$. It closed at 69.54/$ on Tuesday.
- Nifty March futures closed trading at 11,382, premium of 38 points.
- Max open interest for March 28 series at 11,500 Call, (open interest at 26.5 lakh share).
- Max open interest for March 28 series at 11,000 Put, (open interest at 39.9 lakh shares)
Stocks In F&O Ban
- IDBI Bank
- Jet Airways
- Reliance infrastructure
- Reliance Power
New in Ban
- Adani Enterprises
- Nifty PCR at 1.68 versus 1.81.
- Bank Nifty PCR at 1.26 versus 1.6.
HSBC on India
- Overweight on India; Sensex index target for year-end 2019 is 40,300.
- See strongest earnings growth in India across region.
- Buy Stocks: Avenue Supermarts, Asian Paints, Bajaj Finance, HDFC Bank, GAIL.
- Buy Stocks: Divi's Laboratories, Axis Bank, Jubilant Foodworks, Bajaj Auto.
- Buy Stocks: Kajaria Ceramics, Indusind Bank, ITC, Hindalco, Prestige Estates.
- Buy Stocks: Godrej Properties, HPCL.
BofAML on Aurobido Pharma.
- Maintained ‘Buy’; cut price target to Rs 895 from Rs 900.
- Injectables portfolio launches to gain steam.
- Facility diversification, product pipeline to help.
- Five plants in injectables, facility diversification adequate.
Credit Suisse on Bajaj Auto
- Maintained ‘Neutral’ with a price target of Rs 2,700.
- One of the few Indian auto stocks to now trade at a premium to five year avg PE.
- Volumes could decline 5 percent in H1FY20 on ABS cost and normalising channel inventory.
- Bajaj Holdings has been increasing its stake in Bajaj Auto.
- More perplexing fact is Bajaj Auto spending Rs 78,000 crore in buying BHIL stock.
Nomura on BHEL
- Downgraded to ‘Reduce’ from ‘Neutral’; cut price target to Rs 63 from Rs 86.
- Longer-term baseload thermal power demand recovery unlikely to be strong.
- Recently secured orders’ restrictive cash flows could impact working capital.
- Thermal power demand related uptick post FY22 may not be large.
Citi on RBL Bank
- Maintained ‘Neutral’; hiked price target to Rs 670 from Rs 585.
- Well placed to scale-up but low visibility of ROA expansion.
- RBL Bank is well placed for expansion in its CASA franchise.
- Healthy growth in saving deposits aided by a high rate offered and low base.
CLSA on TTK Prestige
- Downgraded to ‘Sell’ from ‘Buy’; maintained price target at Rs 9,000.
- Valuations now adequately factor in growth triggers going ahead.
- See limited scope for further earnings surprise going ahead.
- Large capacities coming on stream focused on relatively lower-margin exports.
Investec on L&T Infotech and Mindtree
- Acquisition would appear compelling when one looks at the potential benefits.
- Likely earnings dilutive by 13 percent for L&T Infotech in year one.
- Such big acquisition increases the risk profile of the deal.
- Deal is ambitious and would require flawless execution.
- Any deal of this nature will be negative for L&T Infotech in medium term and positive for Mindtree.
HDFC Securities on Gujarat State Petronet
- Initiated ‘Buy’ with a price target of Rs 207.
- Volume boost expected from upcoming LNG terminals.
- Investments in CGD to pay-off strongly.
- Likely to remain in sweet spot; Rising FCF to reduce its net debt position.
Antique on ONGC
- Maintained ‘Buy’ with a price target of Rs 205.
- Poised to end the year with perhaps a 'never seen before' profitability.
- Crude oil and natural gas production expected to look up.
- Attractive valuations, strong dividend yield key trigger.