All You Need To Know Going Into Trade On March 25

Stocks To Watch

• Reliance Industries: Facebook is in talks to buy a multi-billion dollar stake in Reliance Jio, as per the Financial Times, citing two people with knowledge of the discussion. Facebook was close to signing a preliminary deal for a 10 percent share but negotiations stalled amid global travel bans and the Coronavirus outbreak.
• Indiabulls Housing Finance: Moody's Investors Services downgrades corporate family rating and foreign currency senior secured rating to B3 from B2. The outlook on all ratings remains negative. Downgrade reflects Moody's expectations that the company's access to funding will remain challenging for longer than expected.
• ONGC: Moody's Investors Service downgrades local and foreign currency issuer rating to Baa2 from Baa1. Outlook on all ratings remains negative. Downgrade reflects the increasingly uncertain oil price environment, depleated cash reserves of the company and government guidelines that constrain the ability of state-owned companies to lower dividends.
• Yes Bank: ICRA upgrades ratings on various bond programs to ICRA BB+ from Default and places the lender on ‘rating watch’ with developing implications.
• Federal Bank: MD & CEO Shyam Srinivasan sold 19.1 lakh shares of the bank for Rs 7.5 crore to repay the ESOP loans availed by him on March 24. Earlier, he had sold 55 lakh shares worth Rs 35.7 crore, also towards repayment of ESOP loans between March 9-13.
• India Grid Trust: Executed a share purchase agreement for complete acquisition of shareholding and management control in East-North Interconnection Company for an enterprise value of Rs 1,020 crore. The Trust has completed the acquisition of its 9th transmission asset and this acquisition has increased the AUM by 10 percent to Rs 12,100 crore.
• Gujarat Alkalies and Chemicals: Starts commercial production of its anhydrous aluminium chloride plant at Dahej on March 23. The estimated increase in annual revenue of the company from this plant would be about Rs 65 crores. The total capacity of the said plant will be 42,420 tons per annum.
• IRCON International: Record date for 5:1 share split set as April 7.

Covid-19 Impact

• Apollo Tyres: Suspends operations at plants in Kerala, Gujarat and Tamil Nadu till March 31.
• Karnataka Bank: Waived charges for transacting on its digital platforms and ATMs.
• Nestle India: Operations in some locations have been scaled down or suspended. In discussion with the authorities to continue operations in the factories / distribution centers where operations have been suspended.
• JK Lakshmi Cement: Operations at grinding units in Kalol and Surat to remain closed until March 31.
• Prataap Snacks: Suspended its operations at plants in Rajkot, Indore, and Guwahati, till further notice.
• VIP Industries: To close its operations in Nashik and Haridwar till March 31.
• Goa Carbon: Operations at its Bilaspur plant have been shut down.

Brokerage Radar

Morgan Stanley On Oil & Gas

• Hike in taxes on petrol and diesel positive for City Gas distributors
• With oil near $30 per barrel and rupee at 76, current fuel prices give sufficient room to raise taxes
• Current Gross Marketing Margin of Rs 8.4-9.5 per litre for OMCs is abnormally high
• May not translate into much earnings due to limited demand on account of the shutdown.

UBS On JSW Energy

• Upgrade to buy from sell
• Price target maintained at Rs 68
• Too much pessimism seems to be priced in
• On a strong footing despite merchant rates remaining soft
• Fall in international coal prices to enhance profitability
• Kamalanga acquisition to be value accretive

UBS On Tata Motors

• Buy rating maintained
• Price target cut to Rs 130 from Rs 285
• Downgrading global auto forecast due to Covid-19
• Rising demand risk requires aggressive cost cutting
• JLR volumes in FY21 may now decline 5 percent instead of 3 percent growth previously

CLSA On Bharti Airtel

• Buy rating maintained
• Price target cut to Rs 590 from Rs 680
• Covid-19 hit likely to be moderate
• Tariff hikes to moderate Covid-19 hit
• Impending TRAI decision on floor tariffs to be a big positive

CLSA On India Consumer

• Covid-19 impact on the sector is evolving rapidly
• Operating leverage highest for hotels, QSR, multiplexes and retail companies
• Financial leverage highest for Lemon Tree, AB Fashion and Arvind Fashion
• Discontinue coverage on Arvind Fashion due to lack of cashflow visibility and restructuring

Investec On Astral Poly

• Buy rating maintained
• Price target of Rs 1,357
• Q1 accounts for 15 percent of financial year revenue
• Adverse impact would be capped even if shutdown lasts longer
• Piping division remains strong
• Adhesives ramp-up was below expectation as distributor addition and KYC checks taking longer than usual

Bulk Deals

• IndusInd Bank: Route One Fund acquired 46.43 lakh shares (0.74 percent) at Rs 328.4 per share.
• Tata Motors DVR: Post Office Life Insurance Fund acquired 28.09 lakh shares (0.55 percent) at Rs 30.14 per share.
• Thyrocare Technologies: Nalanda India Equity Fund acquired 10.96 lakh shares (2.08 percent) at Rs 498.4 per share and HDFC MF sold 10.14 lakh shares (1.92 percent) at Rs 500 per share.
• Indiabulls Housing Finance:  Jasmine Capital Investments sold 28 lakh shares (0.66 percent) at Rs 94.17 per share.
• Andhra Sugars: Bajaj Finance sold 4.63 lakh shares (1.71 percent) at Rs 125.69 per share.

Trading Tweaks

• Move Into ASM Framework: GTL Infra, Bharat Road NEtwork, Sterling And Wilson Solar, Zensar Technologies, CESC Ventures, Indo Rama Synthetics, Texmaco Rail and Engineering, Shree Renuka, GSFC, BASF India.
• Move Into Short-Term ASM Framework: Oriental Carbon and Chemicals, Alembic, Apollo Pipes, ENIL, Kirloskar Ferrous Industries, Hatsun Agro, Cyient, Aavas Financiers, Trident, Finolex Industries, Gujarat Fluorochemicals.
• Price Band Revised To 5 Percent From 10 Percent: Dalmia Bharat, Dhampur Sugar, Edelweiss, Future Enterprises, FUture Lifestyle, GHCL, Graphite India, KEI Industries, Mahindra CIE, MAS Financial, MEP Infra, PNB Housing, Varroc Engineering, VA Tech Wabag, Welspun Enterprises.
• Price Band Revised To 10 Percent From 20 Percent: Allcargo, Bombay Dyeing, Cyient, Finolex Cables, Federal Mogul, GE T&D, Jindal Saw, Karur Vysya Bank, KIOCL, KRBL, Polycab, Shalimar Paints, Tata Metaliks, Thirumalai Chemicals.

Insider Trading

• Great Eastern Shipping: Promoter Ravi Seth acquired 1.46 lakh shares on March 20
• Deepak Nitrite: Promoters acquired 43,500 shares on March 19
• Jamna Auto: Promoter Map Auto acquired 1.28 lakh shares between March 19-20
• Aurobindo Pharma: Promoter Kambam Reddy acquired 50,000 shares on March 19

(As Reported On March 24)

F&O Cues

Index Futures

• Nifty March futures closed at 7,849.9, a premium of 48.9 points versus a discount of 28.6 points.
• Nifty futures Open Interest fell 7 percent across series and shed 12.7 lakh shares in Open Interest.
• Nifty Bank March futures closed at 16,929.7, a discount of 177 points versus 36 points.
• Nifty Bank futures Open Interest across series rose 2 percent and added 22,000 shares in Open Interest.
• Nifty Rollovers at 44 percent while Nifty Bank rollovers at 31 percent.

Options

• Nifty Put-Call Ratio at 1.08 Vs 1.02 across all series.

Nifty Monthly Expiry: March 26

• Maximum Open Interest on Call side at 10,000 strike (17.2 lakh shares)
• Maximum Open Interest on Put side at 7,000 (16.8 lakh shares)
• 7,500 Put (5.4 lakh shares) and 7,000 Put (4.3 lakh shares) see Open Interest addition.
• 8,100 Put (-4.9 lakh shares) and 8,500 Put (-4.4 lakh shares) see Open Interest shedding.

Securities In Ban

In Ban

• Adani Enterprises,
• Jindal Steel & Power
• Just Dial

Out of Ban

• Yes Bank
• Idea
• Indiabulls Housing
• NCC
• Punjab National Bank
• PVR