Nifty, Sensex Post Best Gains In 3-Weeks

Indian shares climbed, with key equity benchmarks posting their best performance in a month as the government cleared the way for tax changes that will lower prices for most mass-consumption products.

Sentiment was also boosted after market regulator SEBI said it plans to relax norms for direct registration of foreign investors and fast-track the listing process for companies as part of efforts to make the Indian stock market more attractive.

The S&P BSE gained 0.8 percent to 31,311 while the NSE Nifty advanced 0.7 percent to 9,655. The market, however, was tilted in favour of the sellers. About 3 stocks declined to every 1 that gained on the NSE.

The Nifty is likely to remain in the 9,500-9,700 zone at least until GST rolls out, said Dinesh Rohira, founder and CEO of 5nance.com adding, “… a breakout on the downside may be possible after that”.

Rohira said investors can treat every dip as a buying opportunity. He advised investing in the real estate stocks while the so-called defensives pharma and I.T. remain an avoid.

Sudden Spike In Idea Cellular Shares

• The stock gains as much as 4.9 percent, most since May 10
• Trading volume over 1.2 times the 20-day average
• Closing in on its 52-week of Rs 81.95

The Nifty Bank Index rose as much as 1.3 percent, the most since May 25, to touch a new record high of 23,806.65.

Shares of the Gautam Adani-led company gained for the fifth day as it rose 2.82 percent, the most since June 02.

Moody’s Investor Service revised its ratings outlook to ‘Stable’ from ‘Negative’ earlier.

Also, the rating agency affirmed the company’s Baa3 issuer and senior unsecured ratings. It said the upgrade in Adani Ports’ rating reflects “stabilisation in the company’s operating performance and a decline in its financial leverage”.

Moody’s said the change in rating also considers “material reduction in related party loans, which previously clouding the company’s credit profile”.

Trading was 2 times the 20-day average for the stock at this time of the day. Bloomberg data showed that about 40 percent of analysts covering the company have changed their price targets over the past month (8 up, 0 down, 11 unchanged, 1 dropped) .

Shares of the shipping company rose as much as 9 percent, extending its winning streak to day 5. It was the stock’s best performance since March 21, adding over 20 percent in market value.

The government is planning a strategic stake sale through auction, Mint report said. It currently holds 73.47 percent stake in the company. It is also mulling a two-stage auction process for the company, which made a net profit of Rs 7.40 crore in 2016-17 fiscal.

Update: Replying to an exchange query, the company clarified it has no specific information/communication from the government regarding the stated news.

The initial public offering of CDSL received a total bid of around 111 percent for the shares on offer, NSE data showed at 15:00 p.m.

The Income Tax Department has ordered coercive action against Cairn Energy Plc. to recover Rs 10,247 crore of retrospective tax after the British oil firm lost a challenge before an international arbitration panel.

Read the full PTI report here

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• Dadlani was second-highest paid executive after CEO
• Well-paid executive with high profile exiting Infosys "surprising and worrying"
• Senior executives continuing to leave three year's into a CEO's tenure appear worrying unless career boost such as CEO responsibility.
• The software maker faces potential risks on apparent over-centralization of responsibility at the top
• Vesting P&L responsibilities of multiple units in the hands of few senior executives or them handling heterogeneous KRAs can lead to sub-optimal performance besides elevating ken man risk.
• TCS has 13 senior execs Vs 3 at Infosys with similar responsibilities
• Suggest Infosys to get more de-centralised

The stock was down 0.9 percent, making it the worst performer on the NSE Nifty IT index.

Shares of the cement maker parred its early losses and rose 1 percent to Rs 239.65 after ICICI Securities upgraded its rating on the stock to ‘Buy’ from ‘Add’.

The stock advanced for a fifth straight session, its best performance since April 06 of this year. The brokerage firm upgraded its price target to Rs 275 from Rs 260.

The stock returned 16 percent so far this year and a gain of 2.2 percent in the past 52 weeks.

CLSA On Cement Companies

• All-India prices higher by 5-6 percent in Q1 (QoQ)
• Demand remain muted in North, West and Central India; East was positive and South was mixed
• Near-term outlook weak due GST and Monsoon
• Monsoon will impact pricing; GST will lead to de-stocking.
• Positive on UltraTech, ACC and Ambuja Cements

Shares of the infrastructure company fell as much as 20 percent, the most since January 09, 2009, after RBI ordered the company's lead lender IDBI Bank to start a Corporate Insolvency Resolution Process (CIRP).

Trading volume was 14 times the 20-day average for this time of the day.

Lanco Infratech is one of the 12 companies that the Reserve Bank of India (RBI) has ordered lenders to take to bankruptcy court as part of an initiative resolve the country's stressed banking system.

"The amounts mentioned...shall be read as Rs 8,146 crore for fund based outstanding exposure and Rs 3,221 crore for non-fund based outstanding exposure as on March 31, 2016," Lanco Infratech said in a BSE filing.

Its debt to equity ratio stands at -60.25. The stock returned negative 47 percent so far this year and a loss of 62 percent in the past 12-months.

Relative Strength Index is 18 for the stock, indicating that it may be oversold.

Shares of the engineering giant halted two-days decline and rose 1.52 percent after winning orders worth Rs 2,231 crore in various business segments, according to the company’s exchange filing.

About 66 percent of analysts covering the company have changed their price targets over the past month (25 up, 1 down, 12 unchanged, 1 dropped), Bloomberg data showed. The stock returned 29 percent so far this year and a gain of 19 percent in the past 52 weeks.

Shares of the hotel operators rallied after the GST Council reduced rates on certain room tariffs. The Council on Sunday fixed 28 percent tax rate for hotel tariffs above Rs 7,500 and 18 percent tax on tariffs from Rs 2500-7500.

• Indian Hotels (+3% to Rs 131; the biggest intraday jump since May 31)
• Hotel Leela Ventures (+3.48% to Rs 23.8)
• Taj GVK Hotels and Resorts (+2.07% to Rs 165.4)
• ITC (+1% to Rs 309.4)
• Royal Orchid Hotel (+10.8% to Rs 115.15)
• Sayaji Hotels (+4.8% to Rs 283)
• Viceroy Hotels (+4.5% to Rs 19.80)
• Advani Hotels & Restaurants (+7.1% to 63.70)
• Kamat Hotels (+3.2% to Rs 54)

Shares of the pharma company rose 2.39 percent to Rs 538.1 after Zydus received a final approval from U.S. drug regulator for its anti-migrane medication.

The drug, Eletriptan Hydrobromide, will be produced at its manufacturing facility in Ahmedabad. The stock returned 4.9 percent so far this year and a loss of 9.5 percent in the past 52 weeks.

Shares of the two and three-wheeler maker rose as much as 3 percent, intraday, the most since May 11, after the Maharashtra government removed a cap on taxi and auto-rickshaw permits, according to a report by Hindustan Times.

About 20 percent of analysts covering the company have changed their price targets over the past month (7 up, 3 down, 39 unchanged), Bloomberg data showed. The stock returned 8.5 percent so far this year and a gain of 11 percent in the past 52 weeks.

Shares of Tata Steel Ltd. rose as much as 2.1 percent to Rs 510.25 after its parent company said it will buy Tata Motors shares from the steelmaker worth up to Rs 3,825 crore.

The proposed stake sale would let the steelmaker reduce some of its Rs 72,367 crore debt.

The stock was among the top five best performers on both the Sensex and the Nifty indexes. With today’s advance, it also managed to break a 3-day losing streak.

The stock has returned 30 percent so far this year, compared to a 10.6 percent advance in the S&P BSE Metal index.

Indian shares climbed in opening trade, with most sectoral gauges advancing led by select auto makers and metal counters.

The S&P BSE Sensex gained nearly 0.6 percent to 31,233 while the NSE Nifty rose 0.5 percent to 9,635. The market breadth was firmly tilted in favour of the buyers. About 5 shares advanced to every 1 that declined on the NSE.

The rupee gained 0.12 percent to 64.35 against the dollar, building on Friday’s advance.

• Tata Sons to boost Tata Motors’ stake, buy shares from Tata Steel
• ABG Shipyard: India said to terminate contracts allotted to ABG (ET Now)
• Lanco Infratech: Lenders to meet to discuss insolvency resolution process
• RBI initiates prompt corrective action on Bank of Maharashtra
• IndusInd Bank said to sell Vasan Healthcare loans to Edelweiss (Mint)
• India may plan to divest govt stake in Dredging Corp (CNBC-TV18)
• Bharat Financial: Assigns Rs 540 crore of receivables to a state-run bank
• B.L. Kashyap: Company to consider sale of shares, warrants on June 26
• Dr. Reddy’s: Srikakulam plant’s unit-I gets one form 483 observation
• Indian Hume Pipe: Receives orders worth Rs 183 crore in Tamil Nadu
• NTPC: Commissions 225 MW out of 250 MW Mandsaur solar project
• Nucleus Software: To buy back up to 10.3 percent of share capital
• Omkar Speciality: Approves raising up to Rs 200 crore rupees via rights issue
• Shriram City Union: Foreign investor Dynasty Acquisition pledges 20.35 percent stake against $180 million loan facility

For a complete list of stocks to watch, click here

• GST panel clears anti-profiteering rule, to meet June 30: Jaitley
• Government gives small firms two months to file detailed returns under GST
• Farm debt waiver may dent India credit growth, Moody’s unit says
• India mandates bio-metric ID for opening bank accounts
• Suzuki Motor’s target price raised 21 percent at Credit Suisse on Indian market
• Boeing said near $5 billion in Max 10 deals with Asian airlines
• India imposed anti-dumping tax on Taiwan’s hydrogen peroxide
• India monsoon crop acreage rises 6 percent by June 16
• Monsoon advances in rice, soybean, cotton areas

• Forex reserves down $11.5 million to $381.2 billion in a week to June 9: RBI
• Global funds sell Rs 760 crore rupees of local stocks; domestic funds buy Rs 890 crore on June 16: Provisional data
• Finance ministry said to ask banks to study buying small banks (PTI)
• General Atlantic said in talks on Karvy Computershare stake (Economic Times)
• Jaguar Land Rover plans to hire 5,000 technical staff (Telegraph)
• SEBI said to plan easing foreign portfolio investor rules (PTI)

• Tejas Networks' subscribed nearly 1.9 times on Friday, with the company receiving bids for 3.21 crore shares, compared with the 1.71 crore shares on offer.
• Central Depository Services (India), whose initial public offering opens today, raised Rs 154 crore by allotting 1.03 crore shares to anchor investors at Rs 149 per share.
• Eris Lifesciences subscribed 0.12 times on its first day Friday, as the company received bids for 18 lakh shares as against 1.59 crore shares on offer
• Future Enterprises eyes Rs 700 crore from logistics unit IPO (Economic Times)
• Private equity firm Kedaara Capital is looking to sell part of its holding in Mahindra Logistics in an initial public offering likely to hit the market in October (Economic Times)

Indian rupee will probably gain against the dollar today, tracking peers in the region. The rupee will also be supported by news report that market regulator SEBI is planning to ease foreign portfolio investor rules in stocks.

The benchmark Indian bonds have been rallying for the past month and now needs fresh triggers. Both the rupee and bonds markets will be keenly watching for developments on at least four fronts this week and those will shape trading strategies.

• Minutes of RBI's last policy meet that will indicate the individual biases of various policymakers. The data is due on Wednesday.
• How the farm debt waivers that was started by Uttar Pradesh and Maharashtra plays out in other Indian states. Moody's ICRA unit has said that such waivers may dent the nation's economic growth.
• The week will be crucial for the spread of the monsoon rains into areas important for crops like soybean, cotton and rice.
• Finally, the roll out plans for the GST. The government said it's committed to implement GST from the scheduled date of July 1.

Good Morning!

The Singapore traded SGX Nifty, an early indicator of Nifty’s performance in India, gained 0.4 percent to 9,630.

Asian stocks climbed in early trade, led by a rally in Japanese equities on a weaker yen while the pound slipped ahead of the formal negotiations on the U.K.’s exit from the European Union. The euro gave up early gains as well despite indications French President Emmanuel Macron’s party is poised to win the biggest majority in 15 years.

Japan's traded deficit in May surprised investors with stronger-than-expected imports. Exports grew 14.9 percent on a year-on-year basis while imports rose 17.8 percent. This was the fifth consecutive month of trade pickup for Japan.

Meanwhile, drama surrounding Donald Trump continued over the weekend with one of lawyers saying that the U.S. president was not under investigation for obstruction of justice.

Global equities remained subdued over the weekend as disappointing housing data and a decline in consumer sentiment indicated that the American economy’s growth rate may be slower than forecast.