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All You Need To Know Going Into Trade On March 24   

Stocks in the news, big brokerage calls of the day, complete trade setup and much more! 

A member of the public walks past the London Stock Exchange (LSE) in London, U.K. (Photographer: Jason Alden/Bloomberg)
A member of the public walks past the London Stock Exchange (LSE) in London, U.K. (Photographer: Jason Alden/Bloomberg)

Asian indices edged higher in Tuesday's trading session along with stock futures in the U.S. Equities across the globe are trying to stage a rebound after falling to their lowest level since 2016.

Markets on Wall Street ended mixed despite a late session surge. Lawmakers failed to agree on a stimulus package. Trading volumes remained above average.

The Singapore-traded SGX Nifty, an early indicator of NSE Nifty 50 Index’s performance in India, rose 4.9 percent to 7,842 as of 7:00 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

  • The S&P 500 registered its lowest close during the Presidency of Donald Trump. The index is now down 35 percent from its record high on February 19.
  • The Dow Jones Industrial Average has lost almost all its gains since Donald Trump was elected President in November 2016.
  • The U.S. Federal Reserve said that it will buy an unlimited amount of bonds to keep borrowing costs low and will set up programs to ensure credit flow to corporations, state and local governments.
  • Yields on the 10-year treasury in the United States was little changed at 0.78 percent.
  • West Texas Intermediate Crude rose 3 percent to $24.05 per barrel.

Get your daily fix of the global markets here.

All You Need To Know Going Into Trade On March 24   

Stocks To Watch

  • Hindustan Unilever: Signed an agreement with Glenmark Pharma to acquire intimate hygiene brand VWash. Under this agreement, the brand and other trademarks, copyrights, know-how associated with Glenmark’s VWash business will be transferred to the company.
  • Yes Bank: To consider raising funds on March 26.
  • NBFC Stocks: RBI to classify loans to NBFCs for on-lending purposes as priority sector lending. The banks are to classify loans to be extended to NBFCs in FY21 under the priority sector category.
  • Gujarat Narmada Valley Fertilizers and Chemicals: TDI-II plant at Dahej has resumed its normal production after the completion of scheduled maintenance.
  • IndusInd Bank: Romesh Sobti has demitted the office of Managing Director and CEO of the Bank from March 23, in line with the tenure approved by RBI. Sumant Kathpalia takes over as MD & CEO for a period of three years

Covid-19 Impact

  • National Stock Exchange: Defers index re-balancing across various equity indices, which was to be effective from March 27. The index will continue to monitor market conditions and announce the revised date for index re-balancing by providing a two weeks notice.
  • Avenue Supermarts: Some stores have remained closed for operation on certain days based on directives by local authorities. Currently, the company is only selling daily use essential items such as grocery and FMCG products at all stores. The company continues to receive a regular supply of goods from all of its suppliers and distributors.
  • State Bank of India: To commit 0.25 percent of its annual profit in FY21 to fight the Covid-19 outbreak situation in India. The fund used to fight the Covid-19 pandemic will be spent from Corporate Social Responsibility funds.
  • United Spirits: To produce 3 lakh liters of bulk hand sanitizers across 15 manufacturing units for use by public healthcare workers. The company will also produce 5 lakh liters extra neutral alcohol for the sanitizer industry to enable the production of more than two million units (250 ml each) of hand sanitizers.
  • Dabur: To suspend production at manufacturing units till March 31, except for essential products like Ayurvedic medicines, Chyawanprash, hand sanitizers and hand wash.
  • Aviation Stocks: Operations of domestic schedule commercial airlines shall cease operations with effect from midnight of March 24. The restrictions shall not apply to cargo-carrying flights. The domestic flight ban is effective until midnight of March 31.
  • Maruti Suzuki: Suzuki Motor Gujarat to close plant operations till March 25. The arm manufactures cars on a contract basis for the company.
  • Bajaj Auto: To close down its operations at Akurdi plant from March 23 till further notice.
  • Reliance Industries: Sets up a 100 bed-center at Seven Hills Hospital, Mumbai for patients who test positive for Covid-19. Sir HN Reliance Foundation Hospital has also offered to set up special medical facilities to quarantine travellers from notified countries and suspected cases identified through contact tracing. Reliance Life Sciences is importing additional test kits and consumables for effective testing. It will also enhance its production capacity to produce 1 lakh face masks per day and personal protective equipments. Reliance Jio will offer 10 mbps basic broadband to help people work from home. Reliance Industries will also provide free fuel for all emergency vehicles and will keep grocery stores open for longer. Group employees earning less than Rs 30,000 per month will be paid twice to improve cash flow.
  • Embassy Office Parks REIT, IRB Invit Fund: SEBI notifies temporary relaxations in compliance requirements for REITs and InvITs. The due date of March 31 for regulatory filings and compliance for REITs and InvITs is extended by a month.
  • JK Lakshmi Cement: Operation at plants based out of Rajasthan and Haryana will be shut till March 31, for Gujarat till March 25 and for Odisha till March 29.
  • TCS: To offer free access to its virtual learning platform to educational institutes across the country.
  • Munjal Auto Industries: To close its manufacturing plants in Vadodara till March 25. Plants in Haryana and Haridwar will be closed till March 31.
  • Wabco India: All sites and plants will be closed till March 28.
  • SRF: Closed operations of its headquarters in Gurugram and chemical business plant in Bhiwadi till March 31.
  • Thermax: Suspended production at its six facilities across Maharashtra, Gujarat and Andhra Pradesh till March 31.
  • India Cements: Plants in Tamil Nadu, Andhra Pradesh, Telangana, Rajasthan and Maharashtra are shutting down operations as per the guidelines issued by the Central and State Governments.
  • HSIL: Suspended its operation in Rajasthan with immediate effect till further notice.
  • Titagarh Wagons: Suspended operations of its West Bengal plant.
  • Bosch: To suspend operations at its plants in Bengaluru, Bidadi, Nashik, Jaipur, and Gangaikondan till March 31.
  • Genus Power: Shuts down all manufacturing units and offices until March 31.
  • Tube Investments: Company’s operations across India stand suspended.
  • Bharat Bijlee: To suspend operations at its plant in Airoli and its branches until March 31.
  • TTK Prestige: Shuts its manufacturing units in Karjan, Roorkee, and Khardi to March 31.
  • Federal-Mogul Goetze: Shuts down plants in Bangalore, Patiala, and Bhiwadi until March 31.
  • GMM Pfaudler: To suspend manufacturing operations at Karamsad until March 25 and in Pune till March 31.
  • Sumitomo Chemical: Closed manufacturing operations in Kutch, Gujarat until further notice. The company said that operations of its offices and cost & freight agencies have also been impacted.
  • Capacite Infraprojects: To halt operations at project sites until March 31.
  • Cochin Shipyard: To stop shipbuilding and ship repair operations until further notice.
  • Ramco Cements: Halts production for its grinding units in West Bengal.
  • Gujarat Alkalies and Chemicals: Will reduce the size of its manufacturing operations. The company said in a press release that there has been a reduction in plant load by 30 percent at Baroda and Dahej complexes.
  • TVS Motor: Halts operations at all its manufacturing facilities and offices in India and globally till further notice
  • CG Consumer Electricals: Has closed its plants located at Ahmednagar, Baroda, Baddi, and Goa till March 25.
  • Minda Industries: To suspend its operations in Gujarat, Karnataka and Tamil Nadu until further notice.
  • Indo Count Industries: Closed down its manufacturing plant in Kolhapur till March 31. Manufacturing operations are expected to resume on April 1.
  • Nippon Life India Asset Management: Closes its collection centres and branch offices.
  • BHEL: All its manufacturing facilities will be closed until March 31. The company shall only run essential operations.
  • Kokuyo Camlin: Operations in Jammu and Kashmir, Maharashtra to be stopped till March 31.
  • Wendt: Closed its manufacturing facility at Hosur, with immediate effect.
  • Amber Enterprises: Closes its manufacturing operation across India till March 31.
  • Somany Ceramics: Closes its operations in Noida, Ahmedabad, and Morbi till March 31.
  • Coromandel International: Complex fertilizer plants in Andhra Pradesh and Tamil Nadu are being operated with reduced manpower. The manufacturing units in the other notified districts have suspended their operations till March 31 based on the directives of the respective local governments.
  • Finolex Industries: Shuts down manufacturing plants in Maharashtra till March 31 and other sites in other states as notified by the respective authorities.
  • Indo Rama Synthetics: To shut production at its facilities at Nagpur with effect from March 24 till further notice.
  • ITI: To run only essential services at all manufacturing units till further notice.
  • Himadri Speciality: To temporarily close manufacturing operations across India till March 31.
  • Whirlpool: Suspends manufacturing operations at Puducherry facility till March 31.
  • Jubilant Foodworks: Dine-in facility across all Domino's Pizza restaurants stands suspended. The company is promoting takeaway and delivery channels but there would be an adverse impact on its topline.
  • SBI Cards: Advises employees across India to Work from Home till March 31. The financial impact of the same is not ascertainable at this stage.
  • Nilkamal: Shuts manufacturing facilities, retail stores, depots, offices at various locations till further notice.
  • HG Infra: Operations are temporarily shut at all locations.

Brokerage Radar

Morgan Stanley On IDFC First Bank

  • Underweight rating maintained
  • Price target of Rs 15
  • Weak retail liability franchise amid intense deposit competition
  • Higher than industry funding and operating costs
  • Low core profitability
  • Higher risk profile of retail loan customers
  • High risk of delinquencies in the corporate credit book likely

Morgan Stanley On Ashok Leyland

  • Overweight rating maintained
  • Price target cut to Rs 64 from Rs 111
  • FY20 truck sales around FY08-09 average
  • Truck sales cycle at a multi-year low
  • Lower earnings estimates, target multiples to reflect low demand
  • Any recovery in truck sales may see sharp re-rating

Morgan Stanley On Interglobe Aviation

  • Overweight rating maintained
  • Price target of Rs 2,057
  • 60 percent of the costs are variable
  • Likely to go through 6-8 months of complete cash burn assuming no revenues and using free cash
  • Well placed among peers to weather the potential downturn
  • Further options to cut costs could be unpaid leave for staff, cut selling expenses, push out maintenance changes as planes are not in use and renogiate lease terms.

UBS On Kotak Mahindra Bank

  • Neutral rating maintained
  • Price target of Rs 1,750
  • Disruption limited to metros so far
  • Deposit side stable while loan growth outlok weak
  • Covid-19 downturn still not priced in

CLSA On Pharma

  • Earnings relatively secure in a market rife with fears of slowdown
  • Should outperform benchmark indices during the said period
  • Offers stable revenue from domestic business and improving exports
  • Top Picks: Sun Pharma, Cipla, Abbott India

JPMorgan On Indian Aviation

  • Airspace closure may persist for longer
  • Grounding fleet may cost IndiGo up to Rs 12-15 lakh per day per aircraft
  • Other domestic airlines at further disadvantage due to high cost base
  • IndiGo's free cash sufficient to sustain zero revenues for some time
  • Air Travel typically bounces back after a crisis

Bulk Deals

  • Tourism Finance Corporation of India: Varanium Dynamic Trust acquired 26.5 lakh shares (3.28 percent) at Rs 32.85 per share and Nomura Singapore sold 26.5 lakh shares (3.28 percent) at Rs 32.85 per share.
  • PVR: Bottom Billion Fund sold 2.65 lakh shares (0.52 percent) at Rs 1,216.29 per share.
  • Move Into Short-Term ASM Framework: Prestige Estates, Ujjivan Small Finance Bank, Aurionpro Solutions, Shoppers Stop, GTL Infra.
  • Move Out Of Short-Term ASM Framework: Adani Transmission, GHCL, Wockhardt, Welspun Corp, Take Solutions, Solara Active Pharma, Orient Refractories, Indo Count Industries, CESC Ventures.
  • Moves Into ASM Framework: KPIT Technologies
  • Price Band Revised To 5 Percent From 10 Percent: Future Enterprises, Quess Corp, Investment Trust of India.
  • Price Band Revised To 10 Percent From 20 Percent: Aavas Financiers, Apex Frozen Foods, Arvind, Ashoka Buildcon, Atul Auto, Brigade Enterprises, Dalmia Bharat, DCB Bank, ENIL, Finolex Industries, Gujarat Fluorochemicals, GSFC, HEG, Hikal, Himatsingka Seide, Indo Rama Synthetics, Infibeam, ICICI Securities, J Kumar Infra, JMC Projects, Kalpataru Power, Kolte Patil, Lemon Tree, Lumax Auto, Orient Cement, Prism Johnson, Redington India, Shree Renuka, Safari Industries, Sobha, Somany Ceramics, Spandana Sphoorty, Sunteck Realty, TD Power, Ujjivan Small Finance Bank, VRL Logistics, Welspun India, Zensar Technologies.

Who’s Meeting Whom

  • Eicher Motors to meet Malabar Investments and Capital Research Global Invest from March 24-25

Insider Trading

  • Godrej Industries: Promoter Anamudi Real Estates acquired 1.4 lakh shares between March 19-20.
  • Great Eastern Shipping: Promoter Ravi Sheth acquired 76,600 shares between March 18-19.
  • Aurobindo Pharma: Promoter Trident Chemphar acquired 5.64 lakh shares between March 18-20.
  • Man Infra: Promoter Parag Shah acquired 2.9 lakh shares on March 19.
  • Music Broadcast: Promoter Jagran Prakashan acquired 90,951 shares on March 20.

(As Reported On March 23)

Money Market Update

  • The rupee ended weaker at a record low of 76.28 against the U.S. dollar on Monday versus 75.20 on Friday.
Opinion
India’s Reserves Plunge Most in 8 Years as RBI Defends Rupee

F&O Cues

Index Futures

  • Nifty March futures closed at 7,581.5, a discount of 28.6 points versus 22.3 points
  • Nifty futures across series open interest down 14 percent, sheds 29.2 lakh shares.
  • Nifty Bank March futures closed at 16,881, a discount of 36 points versus 23 points
  • Nifty Bank futures across series open interest down 6 percent, sheds 82,000 shares.
  • Nifty Rollovers at 34 percent while Nifty Bank rollovers at 26 percent.

Options

  • Nifty Put-Call Ratio at 1.02 versus 1.18 across all series.

Nifty Monthly Expiry: March 26

  • Maximum Open Interest on Call side at 10,000 strike (19.3 lakh shares)
  • Maximum Open Interest on Put side at 9,000 strike (14 lakh shares)
  • 8,000 Call (6.9 lakh shares), 8,100 Call (4.4 lakh shares) and 8,500 Call (3.3 lakh shares) see addition in Open Interest.
  • 8,000 Put (-11.3 lakh shares), 8,500 Put (-6.4 lakh shares) see shedding in Open Interest.
All You Need To Know Going Into Trade On March 24