Sensex, Nifty Fail To Hold On To Gains After Hitting New Highs

Indian equity benchmarks snapped a two-day winning streak after touching new record high during the session. The S&P BSE Sensex Index fell 0.3 percent to end below 34,000, after 24 out of its 31 stocks declined. The NSE Nifty 50 ended 0.4 percent lower at 10,490.75.

The market breadth was tilted in favour of the sellers. Eighteen out of 19 sector gauges compiled by BSE Ltd. declined led by the S&P BSE Oil & Gas Index's 0.8 percent decline. On the flipside, the S&P BSE Healthcare Index was the only sectoral gainer, up 1.8 percent.

Vedanta’s subsidiary Cairn India plans to will acquire controlling stake in Japanese LCD glass maker AvanStrate Inc. for $158 million, according to a media statement on the exchanges.

The company will also buy about $151 million in AvanStrate’s existing debt with a face value of $299 million from banks, the statement added. The company aims to complete the deal by Dec. 31 subject to approval from the lenders.

Shares of the base metal company as high as 1.9 percent intraday to Rs 328.30. Vedanta trades at 17.2 times trailing 12-month earnings per share and 12 times its estimates for the coming year, according to Bloomberg data. The stock has returned 61 percent so far this year.

• Mahindra CIE Automotive: About 30 lakh shares changed hands in two block deals

Buyers and sellers were not immediately known

Source: Bloomberg

HCL Infosystems' board extended Premkumar Seshadri's term as managing director by one year, according to a stock exchange notification.

Shares of the New Delhi-based information technology firm erased gains and fell by more than a percent as of 2:20 p.m. The stock has risen 1.9 percent so far this year, compared to a 29.8 percent advance in the country's benchmark Sensex.

Shares of the Anil Ambani-led company rose as much as 40 percent to Rs 29.95 after the company exited the strategic debt restructuring plan.

In the last two trading sessions the stock has surged over 80 percent.

• NPA formation in this cycle has come from large corporates
• Large project financiers faced larger NPA pain
• The system took more risk than it could
• Axis Bank has traditionally been a corporate lender
• Corporate lending has caused pain for Axis Bank and others as well
• Axis Bank has been fairly disciplined on capital raise
• Want to keep Tier-1 threshold higher than regulatory requirement
• Capital raised in line with capital required for next three years
• Difficult to say if NPA cycle has come to an end
• WPI in positive territory will drive working capital demand
• Corporate growth to be better than in last year
• We have learnt our lessons on concentration risks

• Indian equity benchmarks were trading near record highs led by gains in Sun Pharma, Reliance Industries and Hindustan Unilever. However, gains were capped as ICICI Bank, ITC and TCS were trading on a weak note.
• The S&P BSE Sensex rose 0.16 percent to 34,065 and the NSE Nifty 50 Index was little changed at 10,540. The mid cap and small cap shares were outperforming large cap counterparts as the S&P BSE MidCap Index rose 0.36 percent and the S&P BSE SmallCap Index advanced 0.38 percent.
• Fifteen out of 19 sector gauges compiled by BSE were trading higher led by the S&P BSE Healthcare Index's 2.17 percent. On the flipside, the S&P BSE Oil & Gas Index was the top sectoral loser, down 0.2 percent.
• From the Nifty 50 basket of shares, 27 were declining while 23 were advancing.
• Sun Pharma, Dr. Reddy's Labs, Tech Mahindra, Vedanta and Aurobindo Pharma were among the top Nifty 50 gainers. While, Indian Oil, UltraTech Cement, Bosch, Ambuja Cements and ICICI Bank were among the laggards.

Shares of the Kolkata-based construction and engineering firm rose as much as 5.25 percent to Rs 62.80 after it received an order for construction of 60 TPH Green Anode Plant from Vedanta Limited for a value of Rs 133.50 crore, McNally Bharat said in a stock exchange notification.

• Satin Creditcare: The Delhi-based micro-finance lender rose as much as 8.49 percent to Rs 475.50. As many as 2.67 lakh shares changed hands on the BSE compared with an average of 15,000 shares traded daily in the past two weeks.
• JK Tyre Industries: The Delhi-based tyre maker rose over 3 percent to Rs 51.85. As many as 3.89 lakh shares changed hands compared with an average of 2.02 lakh shared traded daily in past two weeks.
• Bajaj Electricals: The Mumbai-based electronic appliance maker rose 3.6 percent to Rs 491. As many as 22.54 lakh shares changed hands on the BSE compared with an average of 37,000 shares traded daily in the past two weeks.
• Mahindra CIE Automotive: The Mumbai-based auto component maker rose as much as 3.69 percent to Rs 269.70. As many as 24.65 lakh shares changed hands on the BSE compared with an average of 27,000 shares traded daily in the past two weeks.

Drug makers were trading higher in an otherwise rangebound session. The NSE Nifty Pharma Index was the top sectoral gainer, up 2.7 percent led by gains in Sun Pharmaceutical Industries which rose over 6 percent.

Shares of the country's largest drug maker rose as much as 6.57 percent, the most in over nine months, to Rs 576 after the U.S. drug regulator accepted its new drug application for OTX-101, Sun Pharma said in a stock exchange filing.

Shares of oil exploration companies were trading higher after crude oil prices in international markets rose to highest level since mid-2015.

A pipeline blast in Libya and a bullish budget forecast in Saudi Arabia boosted crude prices to levels not seen since mid-2015.

West Texas Intermediate crude neared $60 a barrel as futures in New York and London reached the highest in more than two years.

• Dolphin Offshore Enterprises up 1.7 percent
• Aban Offshore rises 4 percent
• Hindustan Oil Exploration advances 1.9 percent
• Oil India rises 1 percent
• ONGC advances 0.34 percent

Shares of small-cap and mid-cap pharma companies were trading higher.

• Mangalam Drugs & Organics up 7.27 percent
• Gufic Biosciences advances 6.11 percent
• Morepen Laboratories rises 4.21 percent
• Panacea Biotech gains 3.61 percent
• Fortis Healthcare up 3.29 percent
• Alembic advances 2.95 percent
• Marksans Pharma gains 2.94 percent

Shares of 63 Moons Technologies fell as much as 4.3 percent to Rs 121 after SEBI penalised the company as it failed to seek prior approval for the name change from stock exchanges.

The change in name was effected last year amid Financial Technologies (India) Ltd. coming under the scanner for the NSEL fiasco. FTIL is the parent of the now-defunct National Spot Exchange Ltd., which suspended trading in July 2013 following a major payment crisis.

Shares of the cement maker rose as much as 10 percent to Rs 140 after Motilal Oswal initiated coverage on the stock with a 'buy' for target price of Rs 157.

Motilal Oswal in a note said:

• Sanghi Industries is one of the lowest cost cement producers due to its quality limestone, locational advantage and strong integration across the manufacturing value chain.
• Sanghi Industries’ strength lies in its access to 1b tonne of quality marine limestone reserves.
• Expect SIL’s margins to expand by 8.4pp over the financial years through March 2020.
• Diversification into new markets to bring in scale and margin expansion.
• Sanghi Industries is a strong re-rating candidate led by expected increase in capacity and anticipated scale benefits led by diversification into new higher-priced markets.
• Expect operating income and net profit to grow at a compounded rate of 33 percent and 61 percent respectively over the financial years through March 2020, with improved pricing and positive operating leverage.
• Expect return on equity to increase by 11pp to 16.8 percent in the financial year-ending March 2020, led by a sharp uptick in profitability.

Shares of the Anil Ambani-led telecom company rallied for second day in a row, rising as much as 25 percent to Rs 26.85 after the company said it will exit the Strategic Debt Restructuring plan with a zero write-off to lenders.

The company will reduce debt by monetising its wireless business and selling land parcels at Dhirubhai Ambani Knowledge City (DAKC), Chairman Anil Ambani said in a press conference on Tuesday.

Indian equity benchmarks were little changed as gains in Sun Pharma, Yes Bank and Hero MotoCorp were offset by losses in Coal India, ICICI Bank and Asian Paints.

The S&P BSE Sensex rose 0.11 percent to 34,047 and the NSE Nifty 50 Index was little changed at 10,522.

Sixteen out of 19 sector gauges compiled by BSE were trading higher led by the S&P BSE Healthcare Index's 0.7 percent gain. On the flipside, the S&P BSE Capital Goods Index was the top sectoral loser, down 0.17 percent.

Sovereign bonds are likely to remain under pressure as a further slowdown in tax collections may lead traders to speculate about more government borrowing. Total GST revenue under various heads stood at about Rs 80,800 crore for month of November as against Rs 83,300 crore in October.

The dollar rupee pair is expected to fluctuate at around 64 for now, while following a broader market tone, according to a Scotiabank. Implied opening from forwards suggests onshore dollar rupee will start trading around 64.06.

• Circuit filter revised to 10 percent: Vardhman Holdings, Kilburn Engineering, BSEL Infra.
• Circuit filter revised to 5 percent: Ansal Properties and Lanco Infra.
• Shalimar Paints last trading day before going ex-rights basis.

Lokesh Machines

• Sushmita Kacholia sold 1.28 lakh shares or 0.8 percent equity at Rs 75.53 each.

Tara Jewels

• Promoter Rajeev Sheth sold 1.79 lakh shares or 0.7 percent equity at Rs 16.46 each.

Vishal Fabrics

• Asia Investment Corp Mauritius bought 3.74 lakh shares or 1.7 percent equity at Rs 300 each.
• Promoter Devkinandan Corporation sold 3.75 lakh shares or 1.7 percent equity at Rs 300 each.

Shanti Educational Initiatives

• LTS Investment Fund bought 80,800 shares or 0.5 percent equity at Rs 142 each.
• Promoter Tripoli Management Pvt Ltd sold 80,800 shares or 0.5 percent equity at Rs 142 each.

• Pidilite Industries’ Board approves buy back of upto Rs 500 crore at Rs 1,000 per share via tender route.
• Reliance Communications announces exit from SDR framework with zero write-offs to lenders; to reduce debt by Rs 25,000 crore.
• ITC says certain individuals and NGOs have filed petition against high court ruling on cigarette warning.
• Yes Bank acquires 5.62 percent in One Point One Solution under Anchor investor portion.
• NBCC to sell 25,16,013 shares via OFS to employees.
• Srikalahasthi Pipes’ QIP closes; Issue price fixed at Rs 360.5 which is at discount of 5 percent to the floor price.
• IDBI Bank to terminate rating engagement with Moody’s for MTN program.
• Punjab & Sind Bank approves raising funds via share issue.
• Prestige Estates to acquire 66.66 percent in group company -- Prestige Projects -- for Rs 324 crore.

Edelweiss Securities On Kotak Mahindra Bank

• Upgraded to ‘Buy’ from ‘Hold’ with revised target price of Rs 1205 per share.
• Upgrade follows recent interaction with management.
• Confidence stems from culmination of integration pangs (opex & cost).
• Merger of ING Vysya Bank lower than estimated on opex and asset quality fronts.
• Improved visibility on transitioning to steady‐state returns profile in the near term.
• Liability franchise continues to strengthen: Stupendous Saving Account accretion.
• Continued stress in economy and hence CV/CE portfolio to moderate bank growth prospects.

Barcalys On Concerns Of FY18 Slippages

• Achieving the fiscal deficit target goal will be a difficult balancing act, but possible.
• Government’s tax and non-tax revenue collection to be Rs 800-1,200 billion lower than the budgeted sum.
• Disinvestment proceeds remain strong.
• Divestment could generate a surplus of Rs 300-400 billion over and above BE of Rs 725 billion.
• Government can avoid exceeding its gross market borrowing target for the current financial year.

Motilal Oswal on Sanghi Industries

• Initiated coverage with ‘Buy’ rating and price target of Rs 157, a potential upside of 23 percent from yesterday’s close.
• Sanghi Industries is one of the lowest cost cement producers due to its quality limestone, locational advantage and strong integration across the manufacturing value chain.
• Sanghi Industries’ strength lies in its access to 1b tonne of quality marine limestone reserves.
• Expect SIL’s margins to expand by 8.4pp over the financial years through March 2020.
• Diversification into new markets to bring in scale and margin expansion.
• Sanghi Industries is a strong re-rating candidate led by expected increase in capacity and anticipated scale benefits led by diversification into new higher-priced markets.
• Expect operating income and net profit to grow at a compounded rate of 33 percent and 61 percent respectively over the financial years through March 2020, with improved pricing and positive operating leverage.
• Expect return on equity to increase by 11pp to 16.8 percent in the financial year-ending March 2020, led by a sharp uptick in profitability.

• RCom to exit debt recast plan with zero write-offs to lenders
• Bitcoin surpasses $16,000
• Oil hits highest since mid-2015 on Libya blast, Saudi budget
• SEBI imposes fine on 63 Moons Technologies
• From dentistry to repair jobs, entrepreneurs catch the Bitcoin bug
• Drugmaker ignored more than 200 bad quality tests, FDA says
• Renewable energy agency IREDA files IPO papers with SEBI

• Cyrus Mistry gets relief in Rs 500 crore defamation complaint
• Emerging markets’ dream run could see a reality check in 2018

• India’s dollar bond party is just getting started
• Angry young, rural voters to set economic tone for India in 2018

Good Morning!

The Singapore-traded SGX Nifty, an early indicator of NSE Nifty 50 Index’s performance in India, was little changed at 10,518.

Asian stocks were mixed Wednesday in trading thinned by a holiday-shortened week. Oil prices breached $60 a barrel for the first time since 2015 after a pipeline blast in Libya.

Japanese equity benchmarks posted slight gains, while Australian stocks advanced after a four-day weekend. South Korean equities dropped, weighed down by industrial companies after the world’s No. 2 shipbuilder announced a share sale that saw its price tumble as much as 28 percent. The dollar held within recent ranges against the euro and yen.

Among the key events remaining for investors this week:

• U.S. consumer confidence and trade data are on the schedule for the holiday-shortened week.
• Italy’s parliament is expected to be dissolved ahead of elections in 2018.
• Egypt decides on interest rates.

Commodities

• West Texas Intermediate was down 0.2 percent, at $59.71 a barrel.
• The Bloomberg Commodities Index rose 1.2 percent Tuesday, approaching its high for the month.
• Gold was at $1,282.02 an ounce after advancing 0.7 percent Tuesday.