MARKET WRAP: Indices slip as financials weigh; Rupee hits new low of 70.3/$

The benchmark indices settled lower on Thursday led by a fall in the financial stocks after the rupee hit a record low of 70.32 per dollar.

The S&P BSE Sensex ended at 37,664, down 188 points while the broader Nifty50 index settled at 11,385, down 50 points.

HDFC, HDFC Bank, Vedanta, Tata Steel and Reliance Industries (RIL) were among the major losers in the S&P BSE Sensex.

Among sectoral indices, the Nifty Metal index was among top loser of the day, falling 2.27 per cent due to fall in Jindal Steel & Power and Steel Authority of India. The Nifty Bank index also ended lower, slipping 0.70 per cent lower weighed by Bank of Baroda and Yes Bank.

Rupee hits new low

The rupee on Thursday slumped 43 paise against the dollar to trade at a life-time low of 70.32 on strong demand for the US currency.

Investor sentiment got affected by a widening trade deficit on the domestic front and the broad rise in the US dollar versus other Asian peers.

Global Markets

Asian shares pulled away from one-year lows on Thursday, after Beijing said it will hold trade talks with Washington this month, although Turkey’s currency crisis and fears of an economic slowdown in China kept most markets in the red.

MSCI’s broadest index of Asia-Pacific shares outside Japan stood down 0.3 per cent, after shedding as much as 1.1 per cent to hit its lowest since Aug. 11, 2017, while Japan's Nikkei swung into positive territory, up 0.2 per cent on the day.

China on Thursday said a delegation led by its vice commerce minister would travel to the United States for talks in late August at the invitation of Washington.

That helped Chinese stocks pare losses, with the Shanghai Composite Index and Hong Kong's Hang Seng index both down 0.4 per cent, having earlier fallen as much as 1.9 per cent and 1.7 per cent, respectively.

(with wire inputs)

 


3:41 PM IST Nifty Metal index ends 2.27% lower. Top losers: COMPANY LATEST PREV CLOSE LOSS() LOSS(%) JINDAL STEEL 191.85 199.50 -7.65 -3.83 S A I L 74.45 77.40 -2.95 -3.81 JSW STEEL 328.15 341.10 -12.95 -3.80 HIND.ZINC 276.05 285.15 -9.10 -3.19 NATL. ALUMINIUM 68.10 70.25 -2.15 -3.06

3:38 PM IST Nifty sectoral gainers and losers of the day

3:35 PM IST BSE Sensex: HDFC, Vedanta among top losers of the day, Sun Pharma top gainer

3:33 PM IST Markets at close The S&P BSE Sensex ended at 37,664, down 188 points while the broader Nifty50 index settled at 11,385, down 50 points.

3:18 PM IST Gold recovers from 19-month low as US dollar softens Gold clawed back from a 19-month low on Thursday on short-covering and as the U.S. dollar softened following news that Beijing will hold trade talks with Washington late this month. Spot gold was up 0.1 per cent at $1,175.07 an ounce. US gold futures were, however, down 0.2 per cent at $1,182.1. READ MORE

3:07 PM IST Japan, South Korea steel exports to India surge on tariffs, high-end demand India is being hit by a wave of steel from producers in Japan and South Korea, a government document showed, as mills there redirect supply after U.S. President Donald Trump slapped an import duty on the alloy earlier this year.   During the first quarter of the fiscal year starting in April, India's steel imports from South Korea rose 31 percent from a year earlier, while those from Japan climbed 30 percent, according to an internal document from the Ministry of Steel. READ MORE  

2:59 PM IST Falling rupee returning to natural value, no reason to worry: Niti Aayog VC Niti Aayog vice-chairman Rajiv Kumar today said the falling rupee is not a cause of worry as it is getting back to its natural value. READ MORE

2:44 PM IST IT shares rally; Sonata Software, Zensar Technologies up over 10% Shares of midcap information technology (IT) companies have rallied by up to 15% on the BSE after they reported a good set of numbers for the quarter ended June 2018 (Q1FY18).   IT shares are trading higher for the fourth straight day due to persisting weakness in the rupee.The Indian rupee hit record low of 70.32 per dollar on Thursday. READ MORE

2:30 PM IST Base metals slide on global cues, sluggish demand Base metal prices fell by up to Rs 3 per kg at the non-ferrous metals market today, tracking a weak trend overseas amid easing demand from consuming industries.   Traders said sentiment dampened after Shanghai base metals dropped sharply today, with copper and zinc plumbing fresh one-year lows after a broad sell-off in London in the previous session before bouncing back slightly on the news of fresh U.S.-China trade talks. READ MORE Copper

2:17 PM IST Why retail investors should diversify their portfolio and limit risky bets The Securities and Exchange Board of India (Sebi) may soon impose limits on the trading positions that retail investors can take, based on their net worth. Retail investors will have to obtain a net worth certificate from a chartered accountant and submit it to their broker, and their trading limits will be decided accordingly. READ MORE

2:03 PM IST Market Check Index Current Pt. Change % Change   S&P BSE SENSEX 37,746.91 -105.09 -0.28   S&P BSE SENSEX 50 11,931.25 -33.81 -0.28   S&P BSE SENSEX Next 50 33,701.17 -107.47 -0.32   S&P BSE 100 11,666.96 -33.57 -0.29   S&P BSE Bharat 22 Index 3,579.95 -4.05 -0.11 (Source: BSE)

1:43 PM IST 11 fund houses sign up with Paytm Money as platform to go live this month With Paytm’s mutual fund (MF) foray around the corner, 11 fund houses, accounting for 62 per cent of industry assets, have completed the paperwork and have been empanelled with Paytm Money.   The asset management firms to have signed up with the MF distribution platform include large-sized fund houses like ICICI Prudential MF, HDFC MF, Reliance MF, UTI MF, as well as relatively smaller fund houses such as Invesco MF, Mirae AMC and Mahindra MF. READ MORE

LIVE UPDATES

Nifty Metal index ends 2.27% lower. Top losers:

COMPANY LATEST PREV CLOSE LOSS() LOSS(%)
JINDAL STEEL 191.85 199.50 -7.65 -3.83
S A I L 74.45 77.40 -2.95 -3.81
JSW STEEL 328.15 341.10 -12.95 -3.80
HIND.ZINC 276.05 285.15 -9.10 -3.19
NATL. ALUMINIUM 68.10 70.25 -2.15 -3.06

Nifty sectoral gainers and losers of the day


BSE Sensex: HDFC, Vedanta among top losers of the day, Sun Pharma top gainer


Markets at close

The S&P BSE Sensex ended at 37,664, down 188 points while the broader Nifty50 index settled at 11,385, down 50 points.
Gold recovers from 19-month low as US dollar softens

Gold clawed back from a 19-month low on Thursday on short-covering and as the U.S. dollar softened following news that Beijing will hold trade talks with Washington late this month.

Spot gold was up 0.1 per cent at $1,175.07 an ounce. US gold futures were, however, down 0.2 per cent at $1,182.1. READ MORE

Japan, South Korea steel exports to India surge on tariffs, high-end demand

India is being hit by a wave of steel from producers in Japan and South Korea, a government document showed, as mills there redirect supply after U.S. President Donald Trump slapped an import duty on the alloy earlier this year.
 
During the first quarter of the fiscal year starting in April, India's steel imports from South Korea rose 31 percent from a year earlier, while those from Japan climbed 30 percent, according to an internal document from the Ministry of Steel. READ MORE
 
Falling rupee returning to natural value, no reason to worry: Niti Aayog VC

Niti Aayog vice-chairman Rajiv Kumar today said the falling rupee is not a cause of worry as it is getting back to its natural value. READ MORE

IT shares rally; Sonata Software, Zensar Technologies up over 10%

Shares of midcap information technology (IT) companies have rallied by up to 15% on the BSE after they reported a good set of numbers for the quarter ended June 2018 (Q1FY18).
 
IT shares are trading higher for the fourth straight day due to persisting weakness in the rupee.The Indian rupee hit record low of 70.32 per dollar on Thursday. READ MORE

Base metals slide on global cues, sluggish demand

Base metal prices fell by up to Rs 3 per kg at the non-ferrous metals market today, tracking a weak trend overseas amid easing demand from consuming industries.
 
Traders said sentiment dampened after Shanghai base metals dropped sharply today, with copper and zinc plumbing fresh one-year lows after a broad sell-off in London in the previous session before bouncing back slightly on the news of fresh U.S.-China trade talks. READ MORE
Copper

Why retail investors should diversify their portfolio and limit risky bets

The Securities and Exchange Board of India (Sebi) may soon impose limits on the trading positions that retail investors can take, based on their net worth. Retail investors will have to obtain a net worth certificate from a chartered accountant and submit it to their broker, and their trading limits will be decided accordingly. READ MORE

Market Check

Index Current Pt. Change % Change
 
S&P BSE SENSEX 37,746.91 -105.09 -0.28
 
S&P BSE SENSEX 50 11,931.25 -33.81 -0.28
 
S&P BSE SENSEX Next 50 33,701.17 -107.47 -0.32
 
S&P BSE 100 11,666.96 -33.57 -0.29
 
S&P BSE Bharat 22 Index 3,579.95 -4.05 -0.11

(Source: BSE)
11 fund houses sign up with Paytm Money as platform to go live this month

With Paytm’s mutual fund (MF) foray around the corner, 11 fund houses, accounting for 62 per cent of industry assets, have completed the paperwork and have been empanelled with Paytm Money.
 
The asset management firms to have signed up with the MF distribution platform include large-sized fund houses like ICICI Prudential MF, HDFC MF, Reliance MF, UTI MF, as well as relatively smaller fund houses such as Invesco MF, Mirae AMC and Mahindra MF. READ MORE

Current market rally has been narrow. What should an investor do?

Over the past three months, the Nifty 50 index has rallied by around 5.5 per cent. But the rally has been very narrow which signals the last stages of a bull run.
 
Investors should maintain their asset allocation. If they have become overweight on equities, they should book profits and reduce exposure. They should also be mindful of valuations and avoid chasing momentum stocks trading at exorbitant valuations. READ MORE

Following ace investors is a good idea, but don't always ape their bets

Ace investors like Rakesh Jhunjhunwala, Dolly Khanna, Mohnish Pabrai, Porinju Veliyath, etc, enjoy celebrity status within the investor community. Their fans have websites, social media pages and blogs dedicated to them, and their stock picks and portfolios are closely analysed. But following them blindly, without doing your own research, can lead to losses. READ MORE

BS Fund Cafe: 'No fund industry has as bright a future as India's'

Top mutual fund CEOs say that the industry should focus on garnering more retail money across both equity and debt assets, and aim for scale as expenses for investors will come down because of competition and put pressure on margins The mutual fund (MF) industry has come a long way since 1993. How will you attract money going forward? READ MORE
Pharma stocks gain. Sun Pharma, Dr Reddy's, Cipla among top gainers (Image source: NSE)



Elara Capital on SpiceJet

We lower FY19E EPS by 13% after incorporating lower Q1FY19 PAT and subsequently lower target price to Rs 194 from Rs 202. We maintain SpiceJet as top pick in aviation and reiterate BUY rating. We value SpiceJet by ascribing 8.0x FY20 EV/EBITDAR multiple. We maintain our bullish stance on regional market growth, where it has highest capacity. Addition of fuel efficient Boeing-737-8Max would help reduce fuel cost


With higher equity cap in NPS, young investors should increase exposure

The Pension Fund Regulatory and Development Authority (PFRDA) chairman, Hemant Contractor, recently announced that the option to invest up to 75 per cent in equities under the active choice option of the National Pension Scheme (NPS) will become available to investors by the end of this month. In NPS, investors can spread their investments across four asset classes: C (corporate debt), G (government securities), A (alternate assets) and E (equities). READ MORE
GAIL, Infosys, Bajaj Finance, Bajaj Finserv from Nifty 50 hit new highs

Shares of four companies – Bajaj Finance, Bajaj Finserv, GAIL (India) and Infosys – from the Nifty 50 index hit their respective new high on the National Stock Exchange (NSE) on Thursday in otherwise range-bound market. READ MORE

Markets at noon

Index Current Pt. Change % Change
 
S&P BSE SENSEX 37,848.15 -3.85 -0.01
 
S&P BSE SENSEX 50 11,969.30 +4.24 +0.04
 
S&P BSE SENSEX Next 50 33,818.05 +9.41 +0.03
 
S&P BSE 100 11,704.56 +4.03 +0.03
 
S&P BSE Bharat 22 Index 3,598.94 +14.94 +0.42

Centrum Broking on Graphite India Limited (GIL)

The stock has seen a relentless up move and is up ~700% since our note dated 20 June 2017. We continue to value GIL on our conservative AOCF/EV yield methodology using five year average adj. cash flows (FY16-20E) to arrive at our revised target orice of Rs1165. Maintain Hold. Key downside risk is margin pressure due to raw material volatility while upside risk is continuation of high spreads into FY20E/21E as that of FY19E.
Dolat Financial on MRF

MRF is expected to bounce back on the revenue growth front with new product offerings and increased marketing efforts. Although lower top-line growth is expected to put some pressure on the stock, the higher comparative margins will help protect the downside.

Leadership position in the high margins segments will enable MRF to protect valuations. We reiterate our Accumulate rating with a target price of Rs 81,712.
Edelweiss on Berger Paints

Berger Paints' (Berger) Q1FY19 revenue and EBITDA growth of 18.9% and 22.6% YoY, respectively, came in line with our estimates. Domestic volume growth remained strong at ~15% YoY on a base of 5%, in line with our estimate (Asian Paints: ~11% YoY spurt). Consolidated gross margin contracted 110bps YoY owing to spike in input cost, though price hikes (blended ~3.0-3.5% YoY) have brought some relief.

We believe, Berger has gained some market share considering its volume growth surpassed the industry’s. With overall macro revival, we envisage bounce back in decorative volumes and price hikes to aid overall revenue and earnings spurt.  Hence, we raise our target multiple from 42x to 47x FY20E EPS and arrive at revised target price of Rs 371 (earlier Rs 332). Maintain ‘BUY’
NEWS ALERT Vajpayee's health continues to remain critical, on life support: AIIMS

Former prime minister Atal Bihari Vajpayee's condition continues to remain critical, All India Institute of Medical Sciences (AIIMS) said in a statement on Thursday. Vajpayee's health worsened on Wednesday and he is on life support system. "Former Prime Minister Atal Bihari Vajpayee's condition continues to remain the same. He is critical and on life support systems," the statement by the hospital read READ MORE

Atal Bihari Vajpayee

COMMENT IndiaRatings on economy

At a disaggregated level, Ind-Ra expects private final consumption expenditure to grow 7.6% in FY19 compared to 6.6% in FY18. The thrust for growth is coming from the (i) waning impact of demonetisation (ii) rise in rural consumption due to two consecutive favourable monsoons and (iii) reduction in the goods and services tax rate on several items.

However, investment expenditure as measured by gross fixed capital formation is unlikely to significantly improve over FY18. It is expected to grow at 8.0% in FY19. Ind-Ra believes the government capex alone will be insufficient to revive the capex cycle, as its share in the total capex of the economy was only 11.1% during FY12-FY17.
BS Fund Cafe 'The linkage of markets with elections is very weak'
 
Six of India’s leading money managers say broad market valuations are looking better after the correction and they are bullish on export businesses, corporate banks and select capital goods companies Are markets expensive at current valuations? Mahesh Patil: If you look at the valuations on a trailing basis, the markets are expensive.
 
But, you need to keep in mind that the index composition has changed in the past 10 year. READ MORE
Pharma sector index gains as rupee falls


Sun Pharma hits 52-week high on USFDA approval, good Q1 results
 
Shares of Sun Pharmaceutical Industries hit its 52-week high of Rs 618, up 3% on the BSE in intra-day trade on Thursday, after the company announced that it has received approval for CEQUA from the U.S. Food and Drug Administration (FDA).
 
CEQUA is indicated to increase tear production in patients with keratoconjunctivitis sicca (dry eye). READ MORE
Aluminium, Copper twin triggers for Hindalco, Novelis a key positive
 
After a strong show by Hindalco’s US subsidiary Novelis, its domestic operations too put up a robust performance. Though revenues from operations grew just 2.4 per cent year-on-year (sequentially flat), it was the smart jump in profitability of aluminium segment that aided a sharp 17.5 per cent y-o-y jump in operating profits.
 
The good performance by the aluminium segment was on account of better realisations and stable plant operations, helping profits grow 35 per cent y-o-y, while the same on a sequential basis was 21 per cent. READ MORE
WPIL, Roto Pumps zoom 20% on robust Q1 result
 
Shares of WPIL and Roto Pumps are locked in upper circuit of 20% each on the BSE after these companies reported a robust set of numbers for the quarter ended June 2018 (Q1FY19).
 
WPIL has zoomed of 20% at Rs 873, also its 52-week high on the BSE, after the company reported a more than four-fold jump in net profit at Rs 242 million in June quarter (Q1FY19). READ MORE
Edelweiss on Prabhat Dairy

Prabhat Dairy (Prabhat) posted Q1FY19 revenue growth of 7.3% YoY led by a volume spurt of ~36% YoY. B2C sales spiked ~33% YoY, but B2B sales (~67% of sales) declined due to lower milk prices (being pass-through). EBITDA margin inched up 52bps as the benefit of ~194bps YoY gross margin expansion continues to be reinvested in branding-building and distribution network. This lifted EBIDTA just ~14% (~15% below estimate).

With management focusing on brand-building, we believe EBITDA margin is likely to be range-bound. Hence, we are cutting FY19E/20E EPS by 14%/9% and estimate EPS would grow 29% over FY18–20. Maintain “Buy” with a target price of Rs 192 at 22x FY20 EPS
Sebi sets eyes on commodity index derivatives, works on guidelines

Securities and Exchange Board of India Chairman Ajay Tyagi has said in an annual report “there are plans to consider more commodity options contracts to be launched, besides working on guidelines for index products”. Sebi will have to first finalise guidelines, which, according to sources, will suggest common standards for preparing commodity indices and later there will be regulations regarding trading READ MORE
COMMENT Nomura on trade data

India’s July trade data released after market close on Tuesday revealed a higher-than-expected trade deficit of USD18bn from an upwardly revised USD17.1bn in June. This widening was driven by both strong imports (led by gold and electronics) and weaker-than-expected exports (due to pharma, chemicals and oil).
 
We haven’t changed our current account deficit forecasts on the back on this. We expect the current account deficit to widen to USD76bn in FY19 (2.8% of GDP) in FY19 from USD49bn (1.9% of GDP) in FY18. Downside risks to export growth remain due to weaker global growth outlook and imports may stay elevated in the very near-term, but we expect imports to moderate in the coming quarters due to weak rupee, lower oil prices and our view of an impending domestic slowdown. However, the challenge continues to be funding as the basic BOP (current account + net FDI) is negative and portfolio flows also remain negative
Bajaj group knocks out Aditya Birla from 3rd spot in m-cap battle
 
There has been a quiet change in the pecking order among the country’s top-three family-promoted business groups in terms of the market capitalisation of their listed companies. The Pune-based Rahul Bajaj group, thanks to an amazing stock market ride by Bajaj Finance and Bajaj Finserv, has grabbed third spot, pushing the Aditya Birla group down to fourth position.
 
On August 14, the market cap of the Bajaj group’s listed companies reached Rs 3.9 trillion compared to the Rs 3.02 trillion of the Aditya Birla group. READ MORE
Market Check

Index Current Pt. Change % Change
 
S&P BSE SENSEX 37,767.62 -84.38 -0.22
 
S&P BSE SENSEX 50 11,948.40 -16.66 -0.14
 
S&P BSE SENSEX Next 50 33,811.61 +2.97 +0.01
 
S&P BSE 100 11,686.84 -13.69 -0.12
 
S&P BSE Bharat 22 Index 3,602.23 +18.23 +0.51

Edelweiss Securities on Sun Pharma

Sun Pharma (SUNP) reported in-line Q1FY19 numbers, despite Taro’s tepid performance, led by sales from launch of Welchol AG and lower R&D spends. However, management has guided for increase in R&D spends to 8-9% of sales versus 7% in Q1FY19 on the back of clinical trials for label expansion of Illumya. In the specialty pipeline, the company launched Yonsa and expects Illumya & Cequa to be launched in coming quarters.

Management reiterated its low double digit growth guidance for FY19; with 16% growth in Q1 on a weak base, 9M growth comes to 9%. Expect growth to taper and margins to come under pressure going forward. Maintain ‘HOLD’ with revised target price of Rs 560 (Rs 480 earlier)
ICICI Securities on rupee outlook

The dollar-rupee August contract on the NSE was at 69.99 in the previous session. August contract open interest increased 8.71% in the previous day We expect the US$INR to find supports at lower levels. Utilise downsides in the pair to initiate long positions



 

ICICI Securities on Grasim

Factoring better margin, we increase our FY19-FY20 EBITDA 7-10% and coupled with the recent stock price increase in Grasim’s various holdings, we increase our SoTP-based target price to Rs1,285/share (earlier Rs1,200/share), based on 8x FY20E EV/E and assuming 50% holdco discount on its various holdings on CMP basis. Post ~25% stock price correction over past one year, implied holdco discount have likely increased >70% assuming 8x one year forward EV/E for standalone entity which seems unjustified, in our view. Maintain BUY.


ICICI Securities on Sun Pharma

We expect margin recovery to continue in FY19-20 with increasing revenue contribution of specialty portfolio. We remain positive on the stock considering i) ramp up in revenue from branded/specialty business in US ii) higher than industry growth in India, iii) potential to buy inorganic growth based on strong balance sheet and iv) 31% earnings CAGR over FY18-21.
Q1 ANALYSIS Retail lenders spur consumer demand across industries in Q1
 
Revenue and profit growth rebounded across industries in the June 2018 quarter, thanks to the favourable base-effect and an uptick in consumer demand from a low base last financial year.
 
Consumer demand had taken a beating in the first half of 2017 calendar year due to the twin effects of demonetisation and de-stocking prior to the roll-out of the goods and services tax, beginning July 1, 2017. Private consumption-related sectors have done well during the quarter but discretionary spending (automobiles and consumer durable) had done better than non-discretionary spending. READ MORE HERE
JUNE-QUARTER RESULTS Corporate India sees earnings rebound after sharp fall in March quarter
 
After a disastrous fourth quarter of 2017-18 (FY18), when corporate earnings declined by a fifth led by corporate banks, 2018-19 (FY19) has started on an optimistic note for Corporate India. The combined net profit of 2,271 companies, whose first quarter (Q1) results are available, was up 7.9 per cent year-on-year (YoY) during the April-June 2018 period, the best in past five quarters.
 
Top line growth was even better at 18.7 per cent YoY, growing at the fastest pace in at least three years. READ MORE
Nifty sectoral trend


BSE Sensex heatmap


Market at open
 
At 9:15 AM, the S&P BSE Sensex was trading at 37,657, down 194 points while the broader Nifty50 was ruling at 11,379, down 56 points.
NEWS ALERT Rupee slips to fresh low of 70.29 per US dollar
Markets at pre-open

Index Current Pt. Change % Change
 
S&P BSE SENSEX 37,871.42 +19.42 +0.05
 
S&P BSE SENSEX 50 11,982.30 +17.24 +0.14
 
S&P BSE SENSEX Next 50 33,855.52 +46.88 +0.14
 
S&P BSE 100 11,717.28 +16.75 +0.14
 
S&P BSE Bharat 22 Index 3,595.66 +11.66 +0.33

(Source: BSE)
Stock calls by Religare broking
 
Dr. Reddy's Laboratories
Rec: BUY
Last Close: Rs 2,278.45
Initiation range: Rs 2,270-2,280
Target: Rs 2,400
Stop loss: Rs 2,215
 
Dr Reddy's, after breakout from its consolidation zone, has retraced marginally of late and has formed a base around its price support level around 2025. It has again rebounded swiftly from thereon and found support around the support zone of 200 EMA on daily chart. We believe it’s an excellent buying opportunity especially for those who have missed it earlier.

Click here for more
IDBI Capital on Oil India

Oil India (OIL) Q1FY19 result came as a mixed bag where Revenue and EBITDA was largely in line with our estimates while net profit was a miss to our estimates owing to higher tax expenses and lower other income. Revenue was up 45.4% YoY to Rs33.9bn, while EBITDA was up by 61.1% YoY to Rs14.1 bn and PAT was up 56.2% YoY to Rs7bn.

Oil production remained flattish YoY to 0.844mmt while gas production volume declined 4% YoY to 696mmscm. Oil net realization was up 49% YoY to US$72/bbl while calculated gas realization was up 25% YoY to Rs7.4/scm. We raise our EBITDA/EPS estimates by 36%/33% for FY19E and 15%/14% for FY20E on higher crude oil price and exchange rate assumption. Therefore, we raise our target price to Rs 250 from Rs 237. We upgrade the rating to BUY from ACCUMULATE
Stock calls by HDFC Securities
 
Buy Infosys
CMP: Rs 1,409
Target: Rs 1,495
Stop-loss: Rs 1,347
 
Stock has broken out from the price consolidation which held in last 1 month. Stock has registered new all-time high with healthy volumes. Recent depreciation in rupee against the dollar is going to impact positively to the entire IT sector. Rupee has reached at the all-time low level, nearing to 70. Nifty IT Index has also broken out from the last 1 month price consolidation. Being large cap IT Company, Infosys is likely to continue its upwards journey with new milestones. We recommend buying Infosys for the upside target of 1495, keeping SL at 1347.
 
Edelweiss on Amber Enterprises

As a market leader in the domestic room AC (RAC) segment, Amber Enterprises (AEL) is riding the surge in AC demand, coupled with the strong outsourcing tailwind. This augurs well for the company given its focus on manufacturing capability addition moving it up in AC value chain.

We expect rising market share to drive 44% earnings and 25% EBIDTA CAGR over FY18-21E; though with moderate returns given sustained investments to move up the value chain. Our target price of Rs 1,295 is at 30% discount (at 22x PE) to consumer durables sector valuations, given high growth/lower cash flows. Initiate with ‘BUY’
Stocks in news

·         RBI rejected Kotak Mahindra Bank’s plan for dilution of promoter stake
 
·         Reliance Industries said that one of its units at its Jamnagar refinery has been shut down temporarily
 
·         Shilpa Medicare to set up arm for North American operations
 
·         Siyaram Silk Mills commenced production of indigo at Amravati unit
 
·         Svendgaard Labs approved expansion manufacturing facilities at Kheri
 
·         Jindal Worldwide board approved stock split of 5:1
 
·         NCLT approved demerger of Cox & Kings forex division
 
·         Monsanto India clarified that news of a lawsuit by cancer patient pertains to its U.S. arm
 
·         Fortis Healthcare holders clear IHH proposal to buy company
 
·         GMR Infra executed settlement agreement with PE investors for its airport arm
 
·         Allcargo Logistics in talks to buy controlling stake in Gati
 
·         Jet Airways seeks to raise Rs 5000 crore to pay debt

(Source: IIFL report)
IIFL on Sadbhav Engineering

The Company is targeting order inflow of ~Rs.65bn in the remaining period of FY19 which would further strengthen its position. With strong order book and expected pick-up in execution, we expect company to witness robust revenue growth over the next few years.

Tight cost control and high-margin order book are likely to translate into healthy earnings. We have revised our estimates marginally lower to incorporate the Q1 performance. At CMP, EPC business is trading at 15.7x FY20E P/E. We maintain our Buy rating for revised target price of Rs. 394 (based on SOTP valuation).
Anand Rathi on Deccan Cements

Rising demand in AP/Telangana (53% of its sales) aided Deccan Cements in reporting firm revenue growth. It will continue, however, to be impacted by rising costs. We expect its deleveraging and rising Government investment in its key operating region to boost its PAT at a 22% CAGR over FY18-20. We have a Buy recommendation on the stock, with a target price of Rs 600
Emkay Global on Camlin Fine Sciences

Robust growth in the high-margin Blends business and improved operational performance illustrates that our investment thesis is playing out as envisaged. We maintain our FY19E/20E EPS estimates and target price of Rs183 with a Buy rating
MARKET COMMENT Amar Ambani, head of research, IIFL

While India celebrated it’s Independence Day, the world markets came tumbling down.  The outlook is a weak start with focus on banking counters especially Kotak Bank. Foreign investors have upped their buying in recent days and August has been a positive month as far as net FPI flows are concerned.

Prime Minister Narendra Modi, during his Independence Day speech, highlighted that India has become a destination of multi-trillion dollar investments, due to various economic measures and structural reforms by the government. India's GDP stood at $2.597 trillion in 2017 at current prices in market exchange rates overtaking France recently.  With the rupee in turmoil, the street will pay focus to currency movement. Minutes of recent RBI monetary policy committee meeting will be released today
Nomura on Coal India

in the backdrop of a healthy earnings outlook and inexpensive valuations, we think risk-reward remains favourable and the Government of India’s (GoI) disinvestment overhang related bouts of stock price corrections offer good buying opportunities. Our FCFF-based target price nudges up to Rs 320 from INR318 previously, implying 21% total upside (13% implied upside from the current market price and 8% dividend yield).
Top trading ideas by Prabhudas Lilladher
 
BUY RELIANCE CAPITAL
CMP: Rs 437.25
TARGET: Rs 485
STOP LOSS: Rs 410
 
The stock has given a decent rally from the bottom made at around 335 levels and has improved the bias to signify strength for further upside movement. Currently, after a short correction, the stock has bounced back well and we anticipate a further bounce to scale till 480-490 levels in the coming days. With decent consistent volume participation witnessed, we recommend a buy in this stock for an upside target of 485 keeping a stop loss of 410.

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Nifty outlook by Prabhudas Lilladher for today
 
Nifty once again closed above the 11,370 level on Tuesday. However, the daily trend being down, Nifty would continue to have a range bound move. The support for the day is seen at 37,600/11,360 while resistance is seen at 38,080/11,490. Bank Nifty would have a range of 27,750-28,260. With rupee at its lowest value, IT Sector as mentioned earlier would continue to do well and Pharma index getting into a new round of momentum would now show further upmove. Infy, Sun Pharma, and Auro Pharma would be the flavor of the month.
Comfortable forex reserves to deal with undue rupee volatility: Jaitley
 
Union Minister Arun Jaitley said India has comfortable foreign exchange reserves to deal with any undue volatility in the currency market and developments are being closely monitored.
 
"India's foreign exchange reserves are comfortable by global standards and sufficient to mitigate any undue volatility in the foreign exchange market," Jaitley said.
Rupee close at 69.89/$ after falling to an all-time low of 70.08
 
After falling to a historic low of 70.08 to the US dollar during the day, the rupee on Tuesday ended at 69.89, up 2 paise from its previous close of 69.91. Weakness in Turkish currency (lira), along with panic among importers led to the selloff in the Indian currency.
SGX Nifty
 
Trends on SGX Nifty indicate a negative opening for the broader index in India, a fall of 37.5 points or 0.33 per cent. Nifty futures were trading around 11,406-level on the Singaporean Exchange.
Asian shares hit one-year low on Turkey, China worries
 
Asian shares hit fresh one-year lows in early trading on Thursday, while oil and precious metal prices also tumbled as Turkey’s currency crisis and fears of an economic slowdown in China fanned worries about global growth.
 
MSCI's broadest index of Asia-Pacific shares outside Japan fell 1.0 per cent, while Japan's Nikkei and the Australian benchmark dropped 1.2 per cent and 0.4 per cent, respectively.
 
Chinese stocks continued to sag, with the Shanghai Composite Index and Hong Kong's Hang Seng index shedding 1.1 per cent and 0.9 per cent, respectively.
US stocks drop on downbeat earnings, trade tensions
 
Wall Street fell in a day of heavy trading on Wednesday with the S&P 500 posting its biggest percentage drop since late June as investors turned risk-averse on disappointing earnings and escalating global tariff worries.
 
The Dow Jones Industrial Average fell 137.51 points, or 0.54 per cent, to 25,162.41, the S&P 500 lost 21.59 points, or 0.76 per cent, to 2,818.37 and the Nasdaq Composite dropped 96.78 points, or 1.23 per cent, to 7,774.12.
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