Stocks To Watch: Colgate Dilip Buildcon, IDBI Bank, TCS, Zee Entertainment

Stocks in Asia tumbled after a rout in U.S. equities that deepened late in the day amid concerns the trade war is heating up as financial conditions tighten, dampening the outlook for profits.

Japan’s Topix index plunged more than 3 percent, set for the biggest drop since March, with Hong Kong stocks also seen lower. Shares in Australia and South Korea slid. The Singapore-traded SGX Nifty, an early indicator of NSE Nifty 50 Index’s performance in India, fell 2.2 percent to 10,247 as of 7:15 a.m.

Here Are The Stocks To Watch Out For In Today’s Trade

• Government cuts excise duty on aviation turbine fuel to 11 percent from 14 percent. Cut in excise duty to benefit listed airline companies in following pecking order: InterGlobe Aviation> SpiceJet > Jet Airways
• PTC India signed a fresh pact for supplying 200 MW power to Bangladesh for 15 years. The company was already supplying 290 MW power to Bangladesh. The transaction is expected to give export earning of $1.8 billion over its contract period.
• ITI received purchase order worth Rs 334 crore for executing RajNet Project from Rajasthan government to setup 40,000 outdoor Wi-Fi access points.
• Cochin Shipyard to consider approval for share buy-back on Oct. 16.
• Indiabulls Integrated Services’ reorganisation committee recommended the board for demerger of the company’s non-financial business segment to SORIL Infra Resources.
• Soril Infra Resources’ reorganisation committee recommended the board for acquiring the ongoing business operations and undertaking of Indiabulls Group’s pharma arm.
• IDBI Bank appointed Rakesh Sharma as its MD and CEO for six months from Oct. 10 or any until further orders, whichever is earlier.
• Dilip Buildcon has been declared L1 bidder for EPC project worth Rs 1,000 crore by Mahanadi Coalfield for removal of over-burden mining project in Odisha.
• GE Power India to close its factory at Shahabad with effect from Oct. 11. Earlier the company reported that its Vadodara plant was shut from Aug. 27. The management said that it was exploring various options to dispose off the land and building, including machinery and equipment related to these factories.
• Oil India made two hydrocarbon discoveries in Assam in the second quarter of this financial year.

Nifty Earnings To Watch

• TCS

Other Earnings To Watch

• GM Breweries

Earnings Reactions To Watch

Zee Entertainment Q2 (YoY)

• Revenue up 24 percent at Rs 1,976 crore.
• Net profit down 38 percent at Rs 386 crore.
• Ebitda up 37 percent at Rs 653 crore.
• Margin at 33 percent versus 30.1 percent.
• Net profit was lower due to exceptional gain of Rs 135 crore in the year-ago period.

Bulk Deals

• JK Paper: Kotak Mahindra AMC sold 12.15 lakh shares or 0.68 percent equity at Rs 161.85 each.
• NCL Industries: Promoter NCL Homes sold 2.5 lakh shares or 0.55 percent equity at Rs 130.07 each.
• Capri Global Capital: Wellington Management Co. LLP sold 30.3 lakh shares or 1.73 percent equity at Rs 81.5 each.

Who’s Meeting Whom

• Great Eastern Shipping Corporation to meet Vibrant Securities on Oct. 11.
• Balaji Telefilms to meet Motilal Oswal MF ON Oct. 11.
• Eicher Motors to meet Columbia Threadneedle and HSBC Global Asset Management from Oct. 11-12.

Insider Trades

• Hinduja Ventures promoter sold 1 lakh shares on Oct. 8.
• LG Balakrishnan & Bros. promoter group acquired 22,000 shares from Oct. 8-9.

(As reported on Oct. 10)

Money Market Update

• Rupee on Wednesday rallied and closed at 74.21 per dollar against Tuesday’s record-low closing of 74.39 per dollar.

Trading Tweaks

• Dhampur Sugar Mills added in ASM Framework.
• Just Dial ex-date to determine buyback eligibility.
• Kisan Mouldings price band revised to 2 percent.

F&O Cues

• Nifty October futures closed trading at 10,465, premium of 5 points.
• Nifty October open interest up 1 percent; Nifty Bank October open interest up 29 percent.
• Max open interest for October series at 10,500 strike value call option (open interest at 25.6 lakh shares)
• Max open interest for October series at 10,000 strike value put option (open interest at 37.9 lakh shares)

Stocks In Ban

• IDBI Bank

Put-Call Ratio

• Nifty PCR at 1.16 versus 1.11.
• Nifty Bank PCR at 1.34 versus 0.73.

Brokerage Radar

CLSA on Colgate

• Upgraded to ‘Buy’ from ‘Sell’; raised price target to Rs 1,265 from Rs 1,120, implying a potential upside of 20 percent from the last regular trade.
• Colgate has increased growth focus. Promotion activity is at its best.
• Worst seems to be over, as wholesale is stabilising and competition peeked.
• Valuations at a discount to most peers.
• Expect current valuations to sustain as outlook improves.

BofAML on Asian Paints

• Maintained ‘Buy’ with a price target of Rs 1,650, implying a potential upside of 35 percent from the last regular trade.
• Pan-India check indicates swelling optimism about future growth.
• Expect a healthy second half led by solid festive season
• 2-3 percent price hike taken in Oct. 18; Another 4-5 percent hike likely in Dec. 18 if crude remains elevated.
• Premium valuations to sustain on robust and visible growth ahead.

Brokerages On Zee Entertainment

CLSA

• Maintained ‘Buy’; cut price target to Rs 670 from Rs 675, implying a potential upside of 46 percent from the last regular trade.
• Second quarter results were ahead of estimates led by growth in domestic advertising revenues.
• Management reiterated strong ad and subscriptions outlook.
• Zee’s digital platform ZEE5 reported very encouraging numbers.

Macquarie

• Maintained ‘Outperform’ with a price target of Rs 556, implying a potential upside of 21 percent from the last regular trade.
• ZEE delivered blockbuster second quarter led by a strong show on all counts.
• TV ad growth remains robust for ZEE, given its consistent share gains.
• Keenly watching on updates related to Zee5; Expect further increase in reach.

Credit Suisse

• Maintained ‘Buy’; cut price target to Rs 560 from Rs 640, implying a potential upside of 22 percent from the last regular trade.
• Another strong quarter with the base business doing extremely well.
• Ebitda margin arose despite rising investments in digital platform.
• Maintain estimates but lower the valuation multiple.

BofAML

• Maintained ‘Neutral’ with a price target of Rs 470, implying a potential upside of 2 percent from the last regular trade.
• September quarter review: Strong set of numbers beating estimates.
• Subscription growth was led by catch-up revenue and phase-3 realisation.
• Maintain Neutral as questions remain on sustainability of numbers.

Brokerages On Bandhan Bank

Macquarie

• Downgraded to ‘Neutral’ from ‘Outperform’; cut price target to Rs 540 from Rs 560, implying a potential upside of 5.5 percent from the last regular trade.
• September quarter results were strong with robust operating parameters.
• Overhangs: resolution of promoter stake sale and market perceptions of loans given to IL&FS.
• Downgrade on valuations and uncertainties; Await better entry point.

JPMorgan

• Maintained ‘Neutral’; cut price target to Rs 590 from Rs 670, implying a potential upside of 15 percent from the last regular trade.
• September quarter earnings met expectations. Loan growth was more modest.
• Believe bank is on track to meet estimate.
• Cut price target given lower visibility on growth from April 2019.