All You Need To Know Going Into Trade On November 23

Stocks were steady in Australia and South Korea with subdued trading in the U.S. carrying over into Asia. Japan and U.S. markets are closed Thursday for a holiday, while South Korean markets open later than usual due to school exams.

The Singapore-traded SGX Nifty, an early indicator of NSE Nifty 50 Index’s performance in India, rose 0.10 percent to 10,364 as of 6:55 a.m.

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DayBreak

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

Global Cues

• U.S. stocks ended the day lower, after minutes from the latest Federal Reserve meeting indicated that officials expect inflation to remain persistently low even as support for an interest-rate increase grows.
• The Bloomberg dollar spot index fell to the lowest level since October.

Europe Check

• The euro gained as efforts continued to end Germany’s political impasse.
• The Stoxx Europe 600 Index fell 0.3 percent.
• The U.K.’s FTSE 100 Index gained 0.1 percent.
• Germany’s DAX Index fell 1.2 percent, its biggest drop in almost two weeks.

Asian Cues

• Australia’s S&P/ASX 200 Index fell less than 0.1 percent and South Korea’s Kospi index added 0.2 percent.
• Futures on Hong Kong’s Hang Seng Index were little changed.
• Contracts on the S&P 500 Index were flat. The underlying gauge fell 0.1 percent.
• The MSCI Asia Pacific Ex Japan Index rose 0.2 percent.

Here are some key events coming up this week:

• Minutes from the European Central Bank’s October meeting due on Thursday could show dissent in the discussion about tapering.
• In Asia, Singapore will probably say on Thursday its economy expanded more than initially estimated in the third quarter, the consensus shows. October CPI is also due.
• New Zealand October trade and South Korea November consumer confidence are due Friday.

Commodity Cues

• West Texas Intermediate crude rose was steady at $58.02 a barrel, its highest since mid-2015, as U.S. crude stockpiles declined.
• Gold was little changed at $1,291.02 an ounce.

Indian ADRs

Earnings To Watch

• Alkyl Amines
• Kesar Terminals
• Monsanto
• Siemens
• Skipper

Earnings Reaction To Watch

De Nora (Q2, YoY)

• Revenue down 52 percent at Rs 4.3 crore.
• Net loss of Rs 1 crore.
• EBITDA loss at Rs 0.9 crore.
• Margin at -20.9 percent.

Garware Wall Ropes (Q2, YoY)

• Revenue down 9 percent at Rs 206 crore.
• Net profit up 8 percent at Rs 28 crore.
• EBITDA up 9 percent at Rs 43 crore.
• Margin at 20.9 percent from 17.5 percent.

SIS India (Q2, YoY)

• Revenue up 35.7 percent at Rs 1,460 crore.
• Net profit up 318.4 percent at Rs 59 crore.
• EBITDA up 51.3 percent at Rs 74 crore.
• Margin at 5.1 percent from 4.6 percent.

Stocks To Watch

• Arrow Greentech secured patent for manufacturing embedded water soluble film carrier in U.S.
• Healthcare Global Enterprises will issue 11.66 lakh shares at Rs 300 each on a preferential basis to Indgrowth Capital Fund 1 (AIF).
• Thomas Cook will sell up to 75 lakh shares (5.4 percent) in Quess Corp via an offer for sale, at Rs 800 per share, on Nov. 23-24.
• Lasa Supergenerics to begin trial production at its Unit IV from Nov. 25.
• Manaksia Steels to acquire Far East Steel Industries, Nigeria
• Tata Teleservices mobile customers to start transitioning to Bharti Airtel’s network.
• IL&FS acquired an additional 49 percent stake in subsidiary IL&FS Asian Infrastructure Managers from ORIX Corporation, Japan for Rs 2.77 crore.
• Info Edge India: Zomato completed acquisition of on demand logistics and delivery company “Runnr”. Info Edge holds 44.74 percent in Zomato.
• Karur Vysya Bank allots 11.7 crore shares via rights issue.
• Sun Pharma stake in ScPharmaceuticals reduces to 12.31 percent from 14.58 percent after latter's IPO.
• Tata Motors: Jaguar to recall 7,000 sedan and SUVs with faulty electronics.
• Eicher launched CV variants for the e-commerce industry.
• RCom’s land in Mumbai gets 8 bidders; eyes 125 acres to raise funds, cut Rs 47,000 crore debt (Times of India)

Trading Tweaks

• RattanIndia Power circuit filter revised to 10 percent.
• Emami Infra circuit filter revised to 5 percent.
• VRL Logistics to buyback shares worth Rs 41.4 crore at maximum Rs 460 per share.
• Manaksia Industries’ name changed to BKM Industries.
• BFL Developers’ name changed to BFL Asset Finvest.

Bulk Deals

• Thyrocare: Samara Capital sold 7.40 lakh shares or 1.4 percent equity stake at Rs 668.18 each.
• Videocon: IFCI sold 22.50 lakh shares or 0.8 percent equity stake at Rs 12.82 each.
• GATI: Green India Venture Fund sold 18.7 lakh shares or 1.7 percent equity stake at Rs 127.39 each.
• Excel Realty N Infra: Aspire Emerging Fund bought 3.60 lakh shares or 1.1 percent equity stake at Rs 121.5 each.
• Secure Credentials: Kalyani Saraf bought 48,000 shares at Rs 245 each.

Rupee

Rupee closed at 64.92/$ on Wednesday from 64.89/$ on Tuesday.

Top Gainers And Losers

Index Trends

F&O Cues

• Nifty November futures closed at 10,358, premium of 15.9 points from 25 points.
• November contracts: Nifty open interest down 2 percent, Bank Nifty open interest down 2 percent.
• India VIX closed 2.3 percent higher at 14.
• Max open interest for Nov. series at 10,500 Call (open interest at 61.3 lakhs).
• Max open interest for Nov. series at 10,300 Put (open interest at 54.3 lakh, up 1 percent).

F&O Ban

• In ban: DHFL, DLF, HDIL, Indocount, Infibeam, Jain Irrigation, JP Associates, JSW Energy, Just Dial, Reliance Communications, TV 18 Broadcast, and Wockhardt.
• Out of ban: Kaveri Seed and Reliance Capital.

Only intraday positions can be taken in stocks which are in F&O ban. In case of a rollover of these intraday positions, there is a penalty.

Put-Call Ratio

• Nifty PCR at 1.32 from 1.30.
• Nifty Bank PCR at 0.94 from 1.07.

Stocks Seeing High Open Interest Change

Fund Flows

Brokerage Radar

Motilal Oswal on PC Jeweller

• Initiated ‘Buy’ with a price target of Rs 490; implying a potential upside of of 36 percent from the current market price.
• Enormous opportunity in Indian jewellery led by value migration towards organised players.
• Large nation-wide chains to leverage this shift.
• Expect Revenue, Operating income and net profit to grow at a compound annual growth rate of 21 percent, 24 percent and 30 percent respectively over the next three years.
• Return on capital employed to improve to 19.5 percent by March 2020.
• Return on equity to improve to 19 percent by March 2020.
• Positives: increasing store-level sales and profitability and higher use of franchisees to make the business asset-light
• Bull Case price target of Rs 550: Expect revenue and net profit to grow at a compound annual growth rate of 23 percent and 36 percent respectively over till March 2020.

UBS on Aegis Logistics

• Initiated ‘Buy’ with price target of Rs 280; implying a potential upside of 20 percent from yesterday’s close.
• Aegis to benefit from surge in LPG demand and growing dependence on imported LPG.
• Expect LPG demand to record an 11 percent compound annual growth rate and imports a 16 percent compound annual growth rate for the financial years till March 2022.
• Positives: upcoming terminals, weak competition and LPG pipelines being developed by OMCs.
• Land parcels at key ports could be used for two LPG terminals.
• Expect terminalling market share of imported LPG to increase to 28 percent by march 2021.
• Expect operating income and net profit to grow at a compound annual growth rate of 40 percent and 42 percent over the financial years till March 2020.
• Expect return on capital employed and return on equity to improve to 54 percent and 32 percent by March 2021.

CLSA on Kansai Nerolac

• Initiated ‘Buy’ with price target of Rs 600; implying a potential upside of 24 percent from yesterday’s close.
• High leverage to capex revival augurs well at this point for Kansai.
• Margins to sustain though input prices are on an uptrend.
• Price hikes, improvement in revenue mix and operating leverage to sustain margins.
• Expect revenue to grow at a compound annual growth rate of 16 percent till March 2019. Earnings per share to grow at a compound annual growth rate of 17 percent till March 2020.
• With just 12 percent market share, there is potential to drive market share gains.
• View high valuations with long term opportunity, strong balance sheet and high governance levels.

HSBC on Future Retail

• Maintained ‘Buy’; hiked price target to Rs 730 from Rs 590.
• Unveils aggressive growth strategy and digital future.
• With disciplined execution, Future Retail could unlock a virtuous value creation journey.
• Scale is key competitive advantage and Future can improve its cost economics as it accelerates revenue growth.
• Expect earnings to grow at a compound annual growth rate of 30 percent over by March 2020, driven by operating leverage and store rollout
• Current share price builds in earnings to grow at a compound annual growth rate of 14 percent for 15 years post March 2020.