MARKET WRAP: Sensex ends 353 pts higher; metals shine, pharma stocks slip

Indices held gains on Wednesday, supported by broad-based buying across all major sectors, to end the day in the green. Positive sentiment was bolstered at D-street as US president Donald Trump's decision to delay imposition of additional tariff on Chinese imports doused trade-war concerns. Further, benign inflation back home, opened room for more rate cuts by the Reserve Bank of India (RBI).

The benchmark S&P BSE Sensex settled at 37,311 levels, up 353 points or 0.96 per cent, lifted by Reliance Industries, Infosys, ICICI Bank, and HDFC. Vedanta, Tata Steel, YES Bank, and Tech Mahindra were the top gainers at the 30-share index, while Sun Pharmaceuticals, ONGC, Tata Motors, and Asian Paints ended the day as top laggards. The broader Nifty50, too, added 104 points, or 0.95 per cent, to close the day above the psychological mark of 11,000 at 11,029.

Sectorally, all the sectors, barring pharmaceuticals, ended the day with gains. Nifty pharma index shed 4 per cent in the intra-day trade to hit a 5-year low on BSE. The index ended 1.4 per cent lower. READ MORE

On the contrary, Nifty metal was the top gainer, up over 2 per cent, followed by Nifty public sector bank index, up 1.5 per cent.

In the broader market, S&P BSE mid-cap settled at 13,477 level, up 114 points or 0.85 per cent. The S&P BSE small-cap, on the other hand, closed at 12,570 levels, up 51 points or 0.41 per cent.

GLOBAL CUES

European stocks fell on Wednesday as Germany’s economy went into reverse, reviving fears of global recession and tempering a rally for equities after Washington delayed tariffs on some Chinese imports. The Euro STOXX 600 fell 0.4 per cent. Markets in London .FTSE, Frankfurt .GDAXI and Paris FCHI lost from 0.2 per cent to 0.6 per cent. Wall Street futures gauges were also lower.

Equity investors on Wall Street and Asia had cheered earlier when US President Donald Trump pushed back a Sept. 1 deadline for new tariffs on remaining Chinese imports.

The S&P 500 .SPX, which had fallen 1 per cent on Monday, rose 1.5 per cent overnight, sending Asian stocks outside Japan up 0.6 per cent. Benchmarks in Shanghai, Hong Kong and Tokyo all mirrored the surge in US stocks.

3:39 PM IST

3:39 PM IST

3:35 PM IST The S&P BSE Sensex gained 353 points or 0.96 per cent to settle at 37,312 levels while NSE's Nifty50 index climbed 104 points or 0.95 per cent to settle at 11,029.40 levels.   

3:30 PM IST -- Transaction closure subject to due diligence -- Is expected in 30-45 days

3:24 PM IST SPICEJET 138.60 +10.65 +8.32 JINDALSTEL 103.70 +8.95 +9.45   KSCL 481.85 +42.85 +9.76   RELINFRA 49.45 +4.40 +9.77   IDEA 5.57 +0.55 +10.96  

3:10 PM IST In the revised shareholding, under the 'statement showing the shareholding pattern of the Promoter and Promoter Group', it listed ONGC as a promoter with 77.88 crore shares or 51.11 per cent stake just below President of India with 'zero' shares. ONGC in January last year bought the government's entire 51.11 per cent stake in HPCL for Rs 36,915 crore but continued to be mentioned under "public shareholder" in the filings by the oil marketing company. READ MORE

3:08 PM IST Edelweiss Financial Services on Wednesday reported nearly 50 per cent decline in its consolidated net profit at Rs 134.49 crore for the first quarter ended June 30, 2019. Company's net profit in the corresponding April-June quarter of previous fiscal was at Rs 263.32 crore. READ MORE

2:57 PM IST Shares of Dixon Technologies (India) surged 19 per cent to Rs 2,370 intra-day on the BSE on Wednesday after reporting a strong 85 per cent year-on-year (YoY) jump in consolidated net profit at Rs 24 crore in the April-June quarter (Q1FY20), on the back of healthy revenue growth. The consumer electronics company had a profit of Rs 13 crore in the year-ago quarter. READ MORE

2:51 PM IST -- Next GST meeting likely on Sept 20 Alert: Reports had suggested that government could provide relief to automobile manufacturers from payment of GST for 3-6 months to address slowdown

2:49 PM IST Infrastructure major Larsen and Toubro (L&T) on Wednesday said it plans to raise up to Rs 1,400 crore through issuance of non-convertible debentures (NCDs) on private placement basis.   The company, however, did not elaborate on the reasons for raising funds.   "The company proposes to issue rated, listed, unsecured, redeemable non-convertible debentures aggregating up to Rs 1,400 crore on private placement basis," L&T said in a regulatory filing.   Shares of L&T were trading 1.32 per cent higher at Rs 1,331.10 apiece on BSE.

2:40 PM IST -- Standalone net profit at Rs 201.7 crore -- Revenue at Rs 5,000.6 crore -- EBITDA at Rs 843.7 crore

2:36 PM IST

LIVE UPDATES

Sectoral gainers and losers on the NSE


Top gainers and losers on the S&P BSE Sensex


CLOSING BELL

The S&P BSE Sensex gained 353 points or 0.96 per cent to settle at 37,312 levels while NSE's Nifty50 index climbed 104 points or 0.95 per cent to settle at 11,029.40 levels. 
 

NEWS ALERT | Coffee Day in non-binding agreement with Blackstone to sell Bengaluru Tech Park

-- Transaction closure subject to due diligence

-- Is expected in 30-45 days



MARKET CHECK | Top gainers on the BSE at this hour

SPICEJET 138.60 +10.65 +8.32
JINDALSTEL 103.70 +8.95 +9.45
 
KSCL 481.85 +42.85 +9.76
 
RELINFRA 49.45 +4.40 +9.77
 
IDEA 5.57 +0.55 +10.96
 

HPCL re-files shareholding pattern for 6 quarters; lists ONGC as promoter

In the revised shareholding, under the 'statement showing the shareholding pattern of the Promoter and Promoter Group', it listed ONGC as a promoter with 77.88 crore shares or 51.11 per cent stake just below President of India with 'zero' shares. ONGC in January last year bought the government's entire 51.11 per cent stake in HPCL for Rs 36,915 crore but continued to be mentioned under "public shareholder" in the filings by the oil marketing company. READ MORE

Edelweiss Financial posts 50% decline in Q1 net profit at Rs 134 crore

Edelweiss Financial Services on Wednesday reported nearly 50 per cent decline in its consolidated net profit at Rs 134.49 crore for the first quarter ended June 30, 2019. Company's net profit in the corresponding April-June quarter of previous fiscal was at Rs 263.32 crore. READ MORE

Dixon Technologies surges 19% on strong June quarter results

Shares of Dixon Technologies (India) surged 19 per cent to Rs 2,370 intra-day on the BSE on Wednesday after reporting a strong 85 per cent year-on-year (YoY) jump in consolidated net profit at Rs 24 crore in the April-June quarter (Q1FY20), on the back of healthy revenue growth. The consumer electronics company had a profit of Rs 13 crore in the year-ago quarter. READ MORE

NEWS ALERT | GST relief unlikely for auto sector: govt official to CNBC TV18

-- Next GST meeting likely on Sept 20

Alert: Reports had suggested that government could provide relief to automobile manufacturers from payment of GST for 3-6 months to address slowdown

L&T plans to raise up to Rs 1400 cr through NCDs on private placement basis

Infrastructure major Larsen and Toubro (L&T) on Wednesday said it plans to raise up to Rs 1,400 crore through issuance of non-convertible debentures (NCDs) on private placement basis.
 
The company, however, did not elaborate on the reasons for raising funds.
 
"The company proposes to issue rated, listed, unsecured, redeemable non-convertible debentures aggregating up to Rs 1,400 crore on private placement basis," L&T said in a regulatory filing.
 
Shares of L&T were trading 1.32 per cent higher at Rs 1,331.10 apiece on BSE.

Earnings Alert | Grasim Q1 result

-- Standalone net profit at Rs 201.7 crore

-- Revenue at Rs 5,000.6 crore

-- EBITDA at Rs 843.7 crore

Result impact | JSPL gains post Q1 nos


Stocks that hit 52-week low on S&P BSE Sensex

COMPANY PRICE(rs) 52 WK LOW CHG(rs) CHG(%)
ASAHI INDIA GLAS 188.50 185.00 -6.60 -3.38
ASHOK LEYLAND 63.30 60.30 1.75 2.84
BHARAT FORGE 398.10 384.30 -2.60 -0.65
BLUE DART EXP. 2295.00 2243.00 16.50 0.72
BOSCH 13575.00 12698.80 57.75 0.43
» More on 52 Week Low

Earnings Alert | JSPL Q1 result

-- Net loss at Rs 87.4 crore

-- Revenue at Rs 9945.6 crore

-- EBITDA at Rs 2,173 crore

Market check | Sensex rises 500 pts


NEWS ALERT | SBI to divest its stake in an arm through IPO route: BSE filing

-- To dilute stake in SBI Cards & Payment Services Private Limited

News Impact | BEML rises 8% after reports say government to complete divestment by Oct-Dec

-- To fetch Rs 1,000 cr

Market check


MARKET CHECK


OMCs gain

COMPANY NAME LATEST HIGH LOW CHG
(rs)
CHG(%)
RELIANCE INDS. 1295.15 1304.00 1280.10 20.15 1.58
O N G C 127.65 129.80 126.20 -0.65 -0.51
GAIL (INDIA) 128.45 130.25 126.90 2.45 1.94
I O C L 127.65 128.00 124.30 1.65 1.31
H P C L 247.85 248.60 240.00 6.95 2.89
B P C L 354.80 355.50 342.00 11.70 3.41
PETRONET LNG 244.55 246.40 240.20 4.50 1.87
INDRAPRASTHA GAS 312.50 314.55 310.40 3.45 1.12
CASTROL INDIA 116.25 117.15 115.25 0.95 0.82
GUJ.ST.PETRONET 220.05 220.05 217.00 3.55 1.64

HDFC Securities on Alkem Labs

Rating: Buy
 
Target price: Rs 2,180
 
We maintain BUY on Alkem Labs (ALKEM) despite a big miss on our 1QFY20 estimates. Our TP is 2,180 (22x FY21E EPS) with estimates largely unchanged owing to a sharp recovery expected in the next two quarters following a shift in the seasonally strong quarters (from 1Q earlier to 2Q now).

EXPERT COMMENT | Rahul Gupta, Currency Research Head at Emkay Global

The drop in WPI was unexpected, it is majorly due to a fall in food inflation. Despite four rate cuts by the RBI, the food inflation is still subdued mainly because of better monsoon. The drop in retail and wholesale inflation clearly states that the 110 bps rate cut transmission is still not observed, keeping a room open for one more rate cut in the future. If not a rate cut then RBI may force banks to reduce their MCLR in order to revive consumer demand.

YES Bank climbs over 4%


Saregama India tanks 20% on Q1 net loss, stock hits fresh 52-week low

Saregama India shares were locked in lower circuit of 20 per cent at Rs 406, also its 52-week low on the BSE on Wednesday, after the company reported consolidated net loss of Rs 1 crore in the April-June quarter (Q1FY20), due to lower operational income and higher expenses. The movie & entertainment company had a profit of Rs 16 crore in the year-ago quarter. READ MORE

NEWS ALERT | Coffee Day Enterprises to sell Tech Park to Blackstone for Rs 3000 cr: sources to CNBC TV18

-- Announcement expected soon

-- Tech Park is Bengaluru based arm of Coffee Day Ent

Nifty Metal index is trading over 2% higher, led by gains in Jindal Steel


NEWS ALERT | Name removed from list of shell companies, says J Kumar Infra

-- Received letter from Ministry of Corporate Affairs 

(Via BSE filing)


GIC Housing Finance tanks 13% on weak Q1 results

Shares of GIC Housing Finance tanked 13 per cent intra-day to Rs 209 apiece, also its 52-week low, on the BSE on Wednesday after the company reported a 70 per cent year on year (YoY) decline in the net profit at Rs 15 crore in April-June quarter (Q1FY20), due to lower income. The housing finance company had logged a profit of Rs 49 crore in the year ago quarter, the financials of the company showed. READ MORE

NEWS ALERT | Sun Pharma enters into a global licensing agreement with the CSIR IICT: BSE filing


ICICI Securities on Sun Pharma

Rating: Hold
 
Target: Rs 470 (7%) 
 
Target Period: 12 months
 
We expect investors to remain cautious in the backdrop of whistleblower’s complaint filing to Sebi and its possible outcome. These issues are likely to outweigh the company’s steady fundamentals in the near term. Our target price is Rs 470 based on 18x FY21E EPS of Rs 23.4 and Rs 38 Net present value (NPV) for Ilumya.

NEWS ALERT | Kora management to invest another Rs 350 cr in Edelweiss Group, says Edelweiss Fin

-- To raise up to $200 million in advisory business

-- Kora first investor with $75 million

(As reported by CNBC TV18)

MARKET CHECK | India VIX declines 6%


NEWS ALERT | Linde India to sell south region investment biz to Air Water India on slump sale basis: CNBC TV18


NEWS ALERT | July WPI inflation at 1.08% vs 2.02% (MoM)

-- July's WPI inflation lowest in 25 months

-- Fuel & Power inflation at -3.64%

-- Manufactured products inflation at 0.34%

-- Non-food articles inflation at 4.29%

-- Vegetable inflation at 10.67%

-- Wholesale eggs, meat, and fish inflation at 3.16%

-- Pulses inflation at 20.08%

-- Onion inflation at 7.63%

Neuland Labs surges 10%


Nifty Pharma index hits 5-year low; Glenmark at 7-year low post Q1 results

Shares of pharmaceutical companies were under pressure during the morning trade on Wednesday with Nifty Pharma index hitting a 5-year low of 7,550, down nearly 4 per cent on the NSE. The pharma index fell below its previous low of 7,602 touched on June 6, 2014. Among individual stocks, Glenmark Pharmaceuticals plunged 9 per cent intra-day to Rs 380 apiece, hitting an over 7-year low after its June quarter result missed analysts' expectations. READ MORE

Moody's says Reliance's 20% stake sale to Saudi Aramco credit positive

Moody's Investors Service on Wednesday said Reliance Industries' announcement of sale of a 20 per cent stake in its oil to chemicals (O2C) business to Saudi Arabian Oil Company (Aramco) will reduce the company's net leverage and is credit positive.
 
"The O2C business, which has an enterprise valuation of $75 billion, includes RIL's refining and petrochemical divisions, and RIL's 51 per cent stake in its fuel marketing business," Moody's said in a report. READ MORE

NMDC, Tata Steel, Vedanta: What does tech chart indicate for metal stocks?

NMDC Ltd (NMDC): It is the only stock trading above its 200-DMA placed at Rs 99 with a positive sentiment. As the Golden Cross suggests an upside, one can stay bullish till the counter trades above the average. The 100-DMA is placed at Rs 105.50, which is acting as an immediate resistance. All major technical indicators relative strength index (RSI) and moving average convergence divergence (MACD) are trading in negative crossovers, a sign of weak strength. READ MORE

Vedanta gains 4%, top gainer on the S&P BSE Sensex


NEWS ALERT | Government's FY18 outstanding liabilities understated by Rs 7.1 lakh crore: CAG to Finance Commission

-- Liabilities of FCI, PFC, NHAI, and IFRC, NABARD, OMCs understated

-- FY18 liabilities at Rs 84.93 lakh crore; 49.6% of GDP

(As reported by CNBC TV18, quoting unnamed sources)

Pharma stocks trade under pressure

COMPANY LATEST(rs) CHG(rs) CHG(%) VOLUME
SUN PHARMA.INDS. 412.50 -25.05 -5.73 522805
GLENMARK PHARMA. 383.35 -33.65 -8.07 111319
AUROBINDO PHARMA 590.25 -12.65 -2.10 55262
CIPLA 475.25 -0.15 -0.03 46971
LUPIN 729.00 -19.25 -2.57 45745
» More

EXPERT TAKE | Benign inflation continues to provide some more space for MPC: Kotak Securities

CPI inflation in July remained well below the RBI’s target of 4%. Even though core inflation surprised on the upside, it is unlikely to sustain this momentum on the back of weak growth impulses. In this context, MPC’s acknowledgement to consider growth as the highest priority strengthens our belief of another 25-50 bps cut through the rest of FY2020. Impact of skewed rainfall distribution and geopolitical developments remain key risks.

Dr Reddy's Labs slumps 8% as US FDA issues CRL for its version of NuvaRing

Shares of Dr. Reddy's Laboratories Limited cracked 8 per cent on the BSE in Wednesday's early morning trade on reports that the company has received a Complete Response Letter (CRL) from the US Food and Drug Administration for its generic version of contraceptive NuvaRing. According to a CNBC report, brokerage firm Citi believes that the NuvaRing launch is unlikely to happen before mid CY20. READ MORE

GIC Housing Finance tanks nearly 9%


Axis Bank rises over 2%


HDFC Life Insurance slumps over 7% post block deal, recovers later

Shares of HDFC Life Insurance Company slumped as much as 7.5 per cent to Rs 490 apiece on the BSE in the early trade on Wednesday after reports said co-promoter Standard Life sold more than 3 per cent stake in the company via block deal. At 09:15 am, around 64.2 million equity shares representing 3.2 per cent total equity of HDFC Life Insurance Company changed hands via block deal on the BSE, the exchange data shows. READ MORE

Market check


Market check


Nestle India gains after CLSA maintains 'outperform' rating with a target price of Rs 12,415


Nifty PSU Bank index trades 1% higher


Motherson Sumi gains 2%


NEWS ALERT | DHFL India defaults on NCD payment due on August 6: CNBC TV18

-- Default on interest and principal amount

Lack of timely resolution, legal costs may hold back class action suits

A combination of legal costs, which would be significant for minority shareholders, and the lack of timely resolution may stymie the use of class action suits for some time to come.
 
Shareholders are likely to continue voting with their feet when faced with issues in their companies, according to experts. News of shareholders of a large conglomerate, reportedly planning class action suit against an auditor whose resignation allegedly led to a decline in share price, may well mark more of an exception than the rule. READ MORE

Colgate Palmolive slips 1.4%


Orient Cement slips over 2%


Tata Chemicals gains over 2%


Balrampur Chini gains over 4%


Reliance Infrastructure rises over 8%


SAREGAMA India hits 20% lower circuit


Ceat trades nearly 2% higher


CONCOR trades flat with negative bias


Rain Industries adds over 3.5%


Aarti Industries rises 2%


Kaveri Seed rises over 5%


Can Fin Homes rises over 2%


Apollo Hospitals rallies over 7%


Phoenix Mills adds 1%


Piramal Enterprises trades 1% higher


Jindal Steel & Power gains over 4%


Hindustan Unilever slips in trade


Wipro slips over 2%


Glenmark Pharma hits 52-week low


Bosch trades 1.6% lower


United Breweries trades lower


Indiabulls Housing Finance continues rally; trades over 5% higher


Grasim Industries trades over 1% higher


ONGC trades flat with negative bias


Future Retail trades flat


Manappuram Finance gains over 3%


Emami trades flat with positive bias


Dr Reddy Labs slips 7%


HDFC Life Insurance tanks over 7%


Sectoral trends at NSE during Opening trade


Top gainers and losers on S&P BSE Sensex during Opening trade


Market at Open


Market at Open


Top gainers and losers on S&P BSE Sensex during Pre-open


Market at Pre-open


Market at Pre-open


It will take 1-2 years to come out of economic slowdown: Bimal Jalan

In the third part of the series, in which top economists and thinkers offer their views on reviving the economy, the former RBI governor says global slowdown won’t be a hindrance in achieving 7.5-8% growth
 
I think this economic slowdown is cyclical and not structural. The reason why I am saying this is that all factors of production such as investments, savings, land, technology are in our favour. So, it is cyclical in that sense.
 
The slowdown is in some sectors, primarily in manufacturing, and not across the board. There is no slowdown in services. READ MORE

 

Rupee opening

Rupee opens higher at 71/$ vs Tuesday's close of 71.40 against the US dollar

Sebi proposals to make portfolio management transparent, investor friendly

The Securities and Exchange Board of India (Sebi) recently came up with a set of proposals to make portfolio management services (PMS) more transparent, standardise the offerings and make them more investor-friendly.
 
While some significant changes have been recommended, the committee has partially touched upon the fee structure, a problematic area for investors to understand. READ MORE

Banks to get two-year guarantee to purchase 'pooled assets' of NBFCs

Under the scheme, notified on August 10, public sector banks (PSBs) have been given a deadline of six months to purchase “pooled assets” of NBFCs at fair value. “One-time guarantee provided by the government on the pooled assets will be valid for 24 months from the date of purchase and can be invoked on the occurrence of default,” according to the notification. READ MORE

Market Ahead, August 14: All you need to know before the Opening Bell

Global cues, rupee trajectory and the next leg of corporate earnings are expected to sway markets on Wednesday.
 
US President Donald Trump yesterday backed off his September 1 deadline for 10 per cent tariffs on remaining Chinese imports. On the other hand, political unrest in Hong Kong and market rout in Argentina continues. LISTEN TO PRE-MARKET PODCAST HERE

Bosch reports subdued Q1 results as slowdown takes a toll on revenues

The largest auto component maker by market capitalization, Bosch reported a subdued April-June quarter results, which were below Street expectations. Revenues, 85 per cent of which comes from the automotive segment, were down 13.5 per cent over the year-ago quarter.
 
Higher commodity and foreign exchange costs on a weak revenue base impacted operating profit, which fell by 23 per cent, while margins were down 141 basis points over the March quarter to 17.4 per cent. READ MORE


Trump backs off China tariff plan with delays for cellphones, laptops

President Donald Trump on Tuesday backed off his plan to impose 10 per cent tariffs on remaining Chinese imports on Sept. 1, delaying duties on cellphones, laptops and many other consumer goods in the hopes of blunting their impact on US holiday sales.
 
The move sent stocks sharply higher and drew cautious relief from retailers and technology groups. READ MORE

63% banks report decline in NPA in infra sector in six months: Ficci-IBA

More banks are seeing a reduction in bad assets, especially in the sectors they had earlier quoted as high non-performing asset (NPA) sector, a recent survey by Ficci and IBA revealed.
 
The ninth Ficci-IBA survey in their report said the proportion of respondent banks citing a reduction in NPAs stood at 52 per cent as against 43 per cent in the previous round. About 55 per cent of reporting public sector banks (PSBs) have cited a reduction in NPA levels. READ MORE

Silver at three-year high, hits Rs 44,000 a kg in Mumbai's spot market

Silver rose to a three-year high on Tuesday, crossing Rs 44,000 per kg in Mumbai’s spot market. The metal was a laggard for some time but it seems to have bounced back, with short positions in international exchanges getting covered. It closed Rs 1,205 higher, at Rs 44,280 per kg, a price last seen in November 2016. Standard gold closed Rs 600 higher at Rs 37,796 per 10 grams.
 
October gold on the MCX rose to Rs 35,600,, while September silver hit Rs 44,500 levels. Ajay Kedia, director Kedia Commodities said, “strong safe-haven demand amid political tensions in Hong Kong and a weak Indian Rupee, which dropped to test 71.3975 in futures, supported the bullion rally. Pro-democracy protests in Hong Kong continued, and China asked Western diplomats not to interfere in the territory. Experts fear that the protests could disrupt the markets and various industries in the region.” READ MORE

Stocks to watch: Coal India, Future Retail, ONGC, Grasim Ind, IDBI Bank

Here's a look at the top counters that may trade actively in today's trading session -
 
Coal India: State-owned Coal India (CIL) on August 13 reported a 22.2 per cent increase in consolidated profit at Rs 4,629.87 crore for the quarter ended June 30, mainly on higher income. Coal production in April-June quarter stood at 136.94 million tonnes (MT) as compared with 136.85 MT in the year-ago period.
 
Earnings today: A total of 1,007 companies, including Grasim Industries, Indiabulls Real Estate, IDBI Bank, and Wockhardt are scheduled to announce their June quarter earnings today. READ MORE

HDFC Securities on Cadila Healthcare

Recommendation: BUY

TP: Rs 265

CMP: Rs 230

We upgraded CDH recently as we believe that the impact of OAI on its key formulations facility at Moraiya, Gujrat is already priced-in. The sharp ~30% FYTD fall in the price makes it one of the cheapest among the large-cap pharma stocks at 15.7x on FY21E EPS. With ~100 pending approvals and 2/3rd of them being filed from Ex-Moraiya units, we believe US$ 800mn US revenues and Rs 14.6 EPS (ex-Asacol HD) are achievable. With the ability to generate Rs 8-10bn FCFs annually, net debt position remains comfortable at ~Rs 70bn (0.7x FY19).

HDFC Securities on Ramkrishna Forgings

Recommendation: SELL

TP: Rs 380

CMP: Rs 440

We downgrade to SELL and lower our PE multiple to 12x (14x earlier) to factor in the challenging demand environment. (1) The domestic CV sales cycle is expected to remain weak, with the pre-buy having a limited impact over 2HFY20 (2) While the company’s expansion into new markets/segments is expected to contribute towards incremental volumes, the demand outlook in the US is softening as new order intake has been weak over the year. The export volumes will be increasingly at risk over FY21E.
 


Kotak Securities on NCC

Recommendation: BUY

TP: Rs.81

We have factored in impact of weak execution as well as challenges related to AP projects along with higher working capital and finance cost in our estimates. We have cut our earnings estimates for FY20E/FY21E by 21%/28.5%, respectively. Based on FY20E/FY21E revised EPS of Rs 6.6/Rs 6.9, the stock is trading at PE of 10.4x/9.9x, respectively. We have maintained BUY on NCC as we see upside over our revised SoTP based target price of Rs 81 (vs Rs 132 earlier).

Kotak Securities on Greaves Cotton

Recommendation: ADD

TP: Rs.125

GCL is currently trading at 14.5x and 13.2x FY20E and FY21E earnings respectively, which is at a discount to peers in the capital goods space. However, GCL's growth outlook has remained subdued as it has 3W engine sales have underperformed the Industry growth rate.
 
We now value the stock at 14x FY21E EPS (earlier 15x FY21E), thus arriving at a price target of Rs 125 (Earlier Rs 156). In view of the modest upside, we maintain "ADD" rating. Key positive trigger going forward will be ramping up of its 200cc BSVI compliant CREST CNG engine volume (currently undergoing field trials).

Kotak Securities on Bajaj Electricals

Recommendation: REDUCE

TP: Rs.372

BEL is trading at 34.6x and 34.9x on FY20E/21E respectively. In view of the weak earnings outlook in the near term and premium valuations, we maintain our negative outlook on the stock.
 
We arrive at a SOTP based revised target price of Rs 372 (Rs 530 earlier); In our previous update, we had recommended "Sell" rating on the stock. Though the stock price has corrected sharply but it is yet to show meaningful improvement in performance to review our stance. Hence recommend "REDUCE".
 

Kotak Securities on Allcargo Logistics

Recommendation: BUY

TP: Rs.120
 
Strong volume trend in Multimodal Transport Operations (MTO) and stable volumes in the Container Freight station (CFS) division with declining realizations has been the highlights of financial performance for ALL in FY19. The project engineering and solution division remains a drag, while the logistics park division is insignificant for the company. Overall performance in Q1FY20 was healthy, which make us believe that the performance would be stable in near term. Also, we believe that, most of negatives have got factored in the current price. Recommend BUY with an unchanged TP of Rs 120 at 10x FY21 earnings.

Motilal Oswal Financial Services on Bosch

Recommendation: NEUTRAL

CMP: Rs 13,517

TP: Rs 14,715

Upside: 9%

We have reduced our FY20/FY21 EPS estimates by 7-9% to factor in the weak demand environment. The stock trades at 28.2x/23.4x FY20/FY21 EPS. BS6 transition poses risk of further market share loss in CVs as well as continuous decline in its stronghold - PV diesel, but opportunities are expected to open up for BOS in 2Ws (one of 3-4 players in 2W EFIs). We estimate EPS to grow just ~3% CAGR over FY19-21 as the changing competitive positioning poses a threat to our estimates. Hence, we lower our target P/E multiple from 27x to 25x, at ~25% discount to 10-year LPA of 33x. Maintain Neutral.

Motilal Oswal Financial Services on BPCL

Recommendation: BUY

CMP: Rs 343

TP: Rs 465

Upside: 36% 

- Stable crude oil and exchange rate may drive structural changes in pricing of LPG and kerosene, bidding farewell to all under-recoveries.
 
- Factoring in the performance of 1QFY20 and the marginal impact of Ind-AS 116, we revise down our EPS estimate by ~16%/12% for FY20/21.
 
- BPCL is trading at 9.1x FY20E consol. EPS of Rs 37.7 and 7.5x FY20E EV/EBTIDA. We value BPCL at 1.9x FY21E PBV multiple. We reiterate our Buy rating with a target price of Rs 465.

Motilal Oswal Financial Services on Coal India

Recommendation: BUY

CMP: Rs 204

TP: Rs 278

Upside: 36% 

- COAL has managed to keep costs under control on the back of productivity measures and shutting down of old mines. We note that despite it undertaking price hikes for contractual labor in 2HFY19, cash costs/t have declined YoY.
 
- Ongoing efficiency measures and continued growth in volumes (our est. 5-6%), should drive 5% EBITDA CAGR over FY19-21, despite the high base of FY19.
 
- The stock trades attractively at ~3x FY20E EV/adj. EBITDA (v/s historical average of 7x), P/E of 7-8x (v/s average of ~14x) and offers dividend yield of ~9-10%. We value the stock on 4.5x (v/s 5x earlier) FY20E EV/EBITDA at INR278/share. Maintain Buy.

Brokerages approve RIL's growth plan, expect 30% gain in stock

After the announcements were made at Reliance Industries’ 42nd annual general meeting (AGM) on Monday, the stock surged over 12 per cent on Tuesday — registering its highest single-day rally in 10 years. Many brokerages still see a 15-30 per cent upside in the stock from the current market price of Rs 1,275 apiece. READ MORE

NEWS ALERT | China's July industrial output comes in at 4.8%: Reuters

-- Drop in industrial output growth hits more than 17-year low

-- Growth was 6.3% in June

ETFs triple in 2 yrs on back of steady inflow from EPFO, provident funds

The assets of exchange-traded funds (ETFs) have nearly tripled in the past two years, on the back of steady inflow from the Employees Provident Fund Organisation (EPFO) and provident funds. ETFs are traded on stock exchanges, with stocks, bonds or commodities as the underlying product.
 
An ETF’s portfolio exactly mimics the securities in its underlying index, in the same weightage. The EPFO had entered the stock market in August 2015. READ MORE

To allay concerns, govt must take business-friendly steps: Mukul Kochhar

Cost of equity capital has risen in India because of the introduction of new taxes, said Mukul Kochhar, co-head of equities, Investec India. The government should take steps to improve business sentiment, which might weigh on India’s valuation premium to other markets, Kochhar told Samie Modak. READ FULL INTERVIEW HERE
Mukul Kochhar, co-head of equities, Investec India

Today's picks: Britannia to Infosys, hot stocks to watch on Wednesday

Britannia
 
Keep a stop at 2535 and go short. Add to the position between 2475-2490. Book profits at 2470.
 
Tata Steel
 
Keep a stop at 352 and go short. Add to the position between 344-346. Book profits at 343. READ MORE

Technical calls from HDFC Securities: Buy Marico, Sun Pharma

BUY MARICO (Rs 392)
 
TARGET: Rs 415
 
STOP-LOSS: Rs 375
 
Last week, stock surpassed a crucial resistance of 388, which happens to be the multiple tops on the weekly charts. Stock is on the verge of registering new all time high above 396.6. Moving Average and Oscillator Setup is bullish on the weekly and monthly charts. We recommend buying the stock at CMP, for the target of Rs 415, keeping a stop loss at Rs 375 on closing basis. READ MORE

Weekly stock picks by Religare Broking: Sell August Futures of Lupin, ZEEL

Sell August Futures of Lupin Limited (Initiation range: Rs 750-754)
 
Last Close: Rs 745.15
 
Target: Rs 715
 
Stop loss: Rs 770
 
Most pharma counters are trading in prolong downtrend and LUPIN is no different. After a marginal bounce of late, it has been struggling around the resistance zone of multiple moving averages for the past month or so and is likely to fall afresh. We advise traders not to miss this chance and create fresh shorts as per the recommended levels. READ MORE

Bulk deals on NSE as on Tuesday


FII/FPI & DII trading activity on NSE, BSE and MSEI


Rupee Check

Source: Bloomberg


Oil Check

At 8:07 am, Brent Crude Futures were at $60.80 per barrel

SGX Nifty

At 8:05 am, the Singaporean Exchange for Nifty Futures was trading 12 points higher at 10,933 level, indicating a flat start for the domeestic indices. 

Asian Market Check

Source: Reuters


US Market Check

Source: Reuters


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