All You Need To Know Going Into Trade On March 18
Stocks in Asia gained Monday after a positive finish to a strong week for U.S. stocks led global equities to a five-month high. Treasuries steadied.
Shares in Sydney, Seoul and Tokyo advanced after the S&P 500 Index posted its best week since November. The Singapore-traded SGX Nifty, an early indicator of NSE Nifty 50 Index’s performance in India, rose 0.3 percent to 11,511 as of 7:10 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 joined a global advance in equities sparked by China’s renewed commitment to stimulus as investors grew more confident that central banks will remain accommodative.
- The yield on 10-year Treasuries held at 2.59 percent.
- Japan’s Topix index gained 0.4 percent.
- Australia’s S&P/ASX 200 Index rose 0.3 percent.
- Hang Seng Index futures rose 0.4 percent late Friday.
- The S&P 500 rose 0.5 percent Friday. Futures dipped 0.1 percent.
Also read: Emerging-Market Bonds Are Picking Up Steam
- Brent crude traded 0.18 percent lower at $67.04 per barrel.
- WTI crude slipped 0.1 percent to $58.46 a barrel.
- Gold dipped 0.1 percent to $1,300.71 an ounce.
London Metal Exchange
- Nickel resumed gains after a one-day blip, ended 0.3 percent higher.
- Aluminium ended 0.3 percent lower at 0.32 percent lower.
- Lead ended lower for the second day, down 2.46 percent.
- Tin ended loser for the second day, down 0.45 percent.
- Copper resumed gains after a one-day blip, ended 0.4 percent higher.
- Zinc ended loser for the second day, down 1.2 percent lower.
Key Events To Watch This Week
- Company earnings include FedEx, China Telecom, Tencent, Porsche, BMW, Hermes, Tiffany, Micron, Nike and PetroChina.
- The Fed is expected to hold interest rates steady, announce the end of asset roll-off from its balance sheet, and lower projections for the number of interest rate hikes this year. The decision is due Wednesday.
- Central banks in Thailand, the Philippines and Indonesia are all scheduled for policy meetings.
- In the euro zone, purchasing manager survey numbers on Friday will give an indication of the health of the region’s industrial and service sectors at the end of the first quarter.
Stocks To Watch
- Bandhan Bank received ‘No Objection’ from the Reserve Bank of India for amalgamation of Gruh Finance with the bank. Gruh Finance also stated in its press release that the company has received No-Objection letter from National Housing Bank for the above proposed scheme.
- HDFC received the RBI’s approval to acquire shareholding of 9.9 percent or less of the paid-up voting capital of Bandhan Bank post amalgamation of Gruh Finance with Bandhan Bank. The Corporation had applied for a maximum of 14.96 percent stake in the afore-mentioned entity to RBI. HDFC Ltd is the majority shareholder in Gruh Finance.
- NHPC board approved raising $100 million via external commercial borrowing from Japan’s MUFG Bank and raising bonds worth Rs 2,017.2 crore from the domestic market.
- Wipro launched artificial intelligence and machine learning solutions which will be powered by Amazon web services to develop supply chain management solutions.
- Oil India arm entered into a long-term sale and purchase agreement with Tokyo Gas, CNOOC, Centrica and BPCL arm.
- MSTC board approved extension of the bid period for the IPO from March 15 to March 20 and revising the price band from Rs 120 to Rs 128, which was earlier set at Rs 121- Rs 128. The issue period had started on March 13.
- Jubilant Foodworks launched Domino’s Pizza in Bangladesh.
- Reliance Communication: NCLAT said in its order that it cannot direct banks to release the company’s Rs 2,600 crore income tax refund money for payment to Ericsson.
- The Securities and Exchange Board of India 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.
- India Ratings and Research downgraded rating of Vodafone Mobile Services’ NCDs worth Rs 6,000 crore from IND ‘AA-/Negative’ to IND ‘A+/Rating Watch Negative’. This company had merged with Vodafone India on August 31, 2018. The rating agency stated that these ratings stand migrated to Vodafone Idea.
- HUDCO raised Rs 5,320 crore via government bonds and the proceeds will be utilized for lending to Ministry of Housing and Urban Affairs’ arm.
- NCLT approved demerger of Prakash Industries’ PVC pipes and fittings and flexible packaging business into Prakash Pipes.
- Embassy Office Parks allotted 5.8 crore units at Rs 300 per unit worth Rs 1,743 crore to anchor investors.
- Mindtree said it will consider a share buy-back on March 20. The company’s net worth stands at Rs 3,165 crore and 10 percent of it stands at Rs 316.5 crore. It also has a cash balance of Rs 162.6 crore and current investments of Rs 811 crores, as on Dec. 31, as per exchange filings.
- Cadila Healthcare: Zydus Cadila received a final approval from the U.S. FDA for Valsartan and Hydrochlorothiazide tablets.
- Mirc Electronics: Vishal Barot resigned as the CFO’s with effect from March 15.
- U.S. FDA classified inspection of Lupin’s arm Novel Laboratories’ U.S. facility as Official Action Indicated. The regulatory authority stated that the company will be subjected to regulatory action and it may withhold approval of any pending applications in which the facility is listed. This is the second OAI the pharma company has received as recently it’s Mandideep facility also received the same classification from USFDA.
- Punjab and Sind Bank said they will raise equity capital of Rs 500 crore via QIP
- Grasim Industries received demand worth Rs 5,872.13 Crore from the IT Department. Deputy Commissioner of Income Tax raised this demand on account of dividend distribution tax. DCIT order stated that shares of demerged company amounted to dividend.
- DHFL’s Santosh Sharma resigned as the CFO’s effect from March 16. The company stated in the press release that he will be head of the corporate strategy team. The board also approved sale of 30.63 percent stake of its arm Avanse Financial Services to Warburg Pincus arm.
- Global PE Firm Warburg Pincus’ Arm to Acquire 80 percent stake in Avanse Financial Services. Plans to infuse Rs 300 crore via primary equity capital in DHFL’s promoter owned company. The company is an NBFC with 20 percent stake held by World Bank’s Arm International Finance Corporation, as stated in the press release.
- KPIT Technologies-Birlasoft Deal: Ratio of cost of acquisition for KPIT Technologies to be 43.36 percent while for BSL it will by 56.64 percent.
- Lakshmi Vilas Bank board approved allotment of 6.38 crore shares at Rs 72 per share aggregating to Rs 459 crore to qualified institutional buyers.
- Majesco board approved to sell company’s India Insurance Products and Services to its arm for Rs 24.4 crore.
- Vedanta arm Sterlite Copper appointed Pankaj Kumar as its CEO amid attempts to re-open its smelter in Southern India.
- Vodafone Idea: To hold board meet on March 20 to consider various matters related to Rs 25,000 crore rights issue.
- Jammu & Kashmir Bank: approved sale of 4.1 crore equity shares of PNB MetLife Insurance to Oman India Joint Investment Fund II for Rs 185 crore.
- Inox Leisure: Opens four news screen in an existing multiplex. Inox is now present in 67 cities with 137 multiplexes, 563 screens and a total seating capacity of 1.33 lakh seats across India.
- IRB Infrastructure: Has been issues provisional certificate for partial toll collection. Concession period is 26 years, while the project cost is Rs 3,370 crore.
- SAIL: CARE Ratings assigns CARE AA- to company’s long term bank facilities worth Rs 30,000 crore with ‘stable’ outlook.
- SRF: Kotak MF acquired 7.2 lakh shares or 1.26 percent equity at Rs 2,400 each.
- NBCC: ICICI Pru MF acquired 1.4 crore shares or 0.78 percent equity at Rs 65.73 each.
- Reliance Communications: IndusInd Bank sold 1.57 crore shares or 0.57 percent equity at Rs 4.43 each.
- Unitech: Vanguard Group sold 1.47 crore shares or 0.56 percent equity at Rs 1.5 each.
Spencer’s Retail (No shareholding data given on exchanges)
- Promoter Rainbow Investments acquired 4 lakh shares at Rs 169.98 each.
- Vanguard Group acquired 1 crore shares or 2.36 percent equity at Rs 648.49 each.
- Integrated Core Strategies (Asia) sold 27.5 lakh shares or 0.65 percent equity at Rs 647.8 each.
- Virtus Emerging Markets Small Cap Fund acquired 5.2 lakh shares or 1.77 percent equity at Rs 999 each.
- Reliance MF sold 5.19 lakh shares or 1.76 percent equity at Rs 999 each.
Vanguard Group Acquired Stake In Following Companies
- Aarti Industries: 4.16 lakh shares or 0.51 percent equity at Rs 1,425.32 each
- Bata India: 8.51 lakh shares or 0.66 percent equity at Rs 1,374.8 each.
- Castrol India: 50.83 lakh shares or 0.51 percent equity at Rs 166.05 each.
- DCB Bank: 40.04 lakh shares or 1.29 percent equity at Rs 201.69 each.
- NIIT Technologies: 8.39 lakh shares or 1.36 percent equity at Rs 1,336.81 each.
- Teamlease Services: 1.07 lakh shares or 0.63 percent equity at Rs 2,829.97 each.
- TTK Prestige: 75,600 shares or 0.66 percent equity at Rs 8536.06 each.
- V-Guard: 23.26 lakh shares or 0.55 percent equity at Rs 220.69 each.
- Vmart Retail: 1.55 lakh shares or 0.86 percent equity at Rs 2,628.1 each.
Pledge Share Details
- Prabhat Dairy promoter Nirmal Family Trust created pledge of 90.15 lakh shares on March 13.
- Emami promoter group Prabhakar Viniyog created pledge of 1.1 lakh shares from March 11-12.
(As reported on March 15)
- Kwality, Seamec to move into ASM Framework.
- Anup Engineering price band revised to 20 percent.
Stocks Moving Into Short-Term ASM Framework
- IFB Agro Industries
- Indo Count Industries
- IIFL Holdings
- RattanIndia Power
- Indiabulls Integrated Services
- MT Educare
- RattanIndia Infrastructure
- Manpasand Beverages
- Jindal Stainless
- GVK Power & Infrastructure
- Asian Granito India
- CESC Ventures
- Sadbhav Engineering
Who’s Meeting Whom
- Mahindra and Mahindra to meet Wellington Asset Management and Loomis Sayles between March 18-20.
- Tata Motors to meet HDFC MF. Birla MF and other investors from March 18-19.
- India Energy Exchange to meet DMZ Partners Investment Management on March 19.
- Cholamandalam Investment and Finance to meet Ambit Capital on March 18.
- Emmbi Industries to meet Moneybee Investment Advisors on March 18.
- Thyrocare Technologies to meet Way2Wealth and SAIF Partners between March 20-25.
- Finolex Industries to meet Dalal & Broacha Stock Broking on March 18.
- Asian Granito promoter and director Kamleshbhai Patel acquired 45,000 shares on March 13.
- Dabur India promoter Ratna Commercial Enterprises acquired 50,000 shares on March 13.
(As reported on March 15)
Money Market Update
- The rupee on Friday strengthened for the fifth straight session to its highest since Aug. 10, 2018 to 69.09/$. It closed at 69.35/$ on Thursday.
- Nifty March futures closed trading at 11470, premium of 43 points.
- Max OI for March 28 series at 11,500 Call, OI at 23.5 lakh shares.
- Max OI for March 28 series at 11,000 Put, OI at 39.1 lakh shares.
Stocks In F&O Ban
- In Ban: Adani Enterprises, IDBI, Jet Airways, Reliance Infrastructure, Reliance Capital
- New in Ban: Reliance Capital
- Out of Ban: Reliance Power, BEML
- Nifty PCR at 1.77 versus 1.68.
CLSA on Lupin
- Maintained ‘Sell’; cut price target to Rs 730 from Rs 760.
- Lupin faces significant regulatory challenges.
- Somerset accounts for 5-7 percent of total sales and 25 percent of ANDAs pending approvals.
- Removing Somerset launches from estimates leads to 6-7 percent EPS cut for FY20-21.
CLSA on Cement
- 1 percent change in cement prices impacts FY20 EPS estimates by 5-8 percent.
- Industry behaviour and discipline are key pricing drivers.
- Strong demand should result in better pricing but trends suggest limited correlation.
- Pricing not exactly predictable and hence pricing volatility is here to stay.
- Positive on the sector with Ramco, Shree and ACC as top bets.
CLSA on Infrastructure
- New approved projects will support new order book till new government settles-in.
- Projects approvals are 64 percent infrastructure and 33 percent of power projects, and all are well-funded.
- Business visibility is near an all-time high, stocks are trading at low valuations.