Morning Notes
5th Aug, 2019
 

Trading Range:

Nifty opened gap down at 10930 on Friday and made a high and low of 11080 and 10849 respectively before closing positive at 10997.

Review/Outlook:

For the day, support for Nifty exists at 10930 and 10850 levels whereas resistance for Nifty stands at 11080 and 11120 levels.

Review/Outlook:

Bank Nifty opened down at 28224, made a high of 28545, low of 27936, and closed negative at 28205. For the day, support for Bank Nifty exists at 28000 and 27800 levels whereas resistance for Bank Nifty stands at 28500 and 28700 levels.

Market Scan
Benchmark Indices
Index Clsg Chg%
Sensex 37,118 +0.27
Nifty 10,997 +0.16
BSE 200 4,585 +0.13
BSE Midcap 13,547 +0.15
BSE Smallcap 12,496 -0.44
Dow Jones 26,485 -0.37
NASDAQ 8,004 -1.32
 

DERIVATIVES INDICATORS FOR AUG 05, 2019:

NIFTY 10997.35 (+17.35) (+0.16%)
NIFTY AUG FUTURE 11024.05  (26.70 Points Premium)
NIFTY PCR - OI 1.18(+0.02)
NIFTY OPEN INTEREST 2.02Cr. (+1.22%)
INDIA VIX 15.18 (+4.33%)
NIFTY ROLLOVER 5%

NIFTY OPTIONS ACTIVITY (29-AUG SERIES)

CALL 11000 CE +4.10 lac Shares
CALL 11200 CE -1.81 lac Shares
PUT 10900 PE +4.14 lac Shares
PUT 10800 PE +1.28 lac Shares
Sectoral Indices (BSE)
Index Clsg Chg%
Auto 15,635 +1.07
Bankex 31,902 -0.62
PSU 6,733 -1.76
Healthcare 12,555 -0.25
IT 15,531 +0.65
 
Market Turn Over (`cr)
Index 02/08 01/08
BSE Cash 2,745 2,093
NSE Cash 37,984 33,533
NSE F&O 1,142,377 2,799,622
BSE Delivery % 35.42 39.00
Advances / Decines BSE Cash
Adv(%) Dec(%)
BSE 100 47.52 52.48
BSE 200 44.28 55.72
BSE 500 42.12 57.09
Total BSE 41.47 53.45
 
Commodities, Forex & Debt
Clsg Chg%
Crude Oil NYMEX $ bl 55.31 -0.63
Gold Rs./ 10 Gms 36271.00 +1.79
Silver Rs./ Kg 41364.00 +0.92
Rs.- US $ 69.67 +0.37
Rs.- Euro 77.39 +0.55
FII (Rs cr )
02/08* 01/08*
FIIs -1166.87 -1465.71
MFs - -

*Date refers to the day of activity and not the day on which it is reported.

 
Details Buy Sell Open interest at the
end of the day
Net Position
No. of
Contracts
Value
(Rs. Cr)
No. of
Contracts
Value
(Rs. Cr)
No. of
Contracts
Value
(Rs. Cr)
Value
(Rs. Cr)
Index Futures       73,416.00       5,106.23       84,734.00       6,120.89    2,21,522.00     17,151.88  (1,014.66)
Index Options  36,09,478.00  2,43,067.69  36,14,709.00  2,43,529.49    6,29,898.00     47,886.15     (461.80)
Stock Futures    2,76,021.00     15,857.35    2,57,121.00     14,745.15  14,84,272.00     87,450.70   1,112.20
Stock Options    1,27,556.00       7,706.55    1,24,237.00       7,507.73       70,065.00       3,922.80      198.82
Total  40,13,055.00  2,66,631.59  39,96,067.00  2,65,782.37  21,84,235.00  1,39,259.65     (165.44)
Corporate News
ITC Chairman Sanjiv Puri has disclosed that the construction of its Rs.800-crore food processing plant at Manoharabad in Medak district is almost complete and it will go on stream in two to three months. (BL).
Britain’s Cairn Energy PLC, which gave India its biggest onshore oil discovery and gas find that opened the KG basin, is keen to reinvest in the country if the retrospective tax issue it is facing is resolved, its chief executive said. (ET).
Maruti Suzuki India (MSI) has said headwinds like the softening of demand in the domestic market and protectionist measures abroad may impact its ability to create value in the short term. (BL).
Amid talk of financial stress driving founder V. G. Siddhartha to allegedly end his life, the coffee tycoon had repaid all the loans taken from Tata Capital Financial Services (TCFS) and has no outstanding dues to the entity. (ET).
Drug major Sun Pharma on Saturday said it is discontinuing operations at two clinical pharmacology units in Vadodara (Gujarat) to bring in efficiencies in cost and processes. (ET).
Debt laden McLeod Russel India Ltd is hopeful that its restructuring proposal will be accepted by the consortium of lenders led by ICICI Bank. It is also exploring the possibility of selling three or four more of its gardens in Dooars and Assam to pare debt. (BS).
Shemaroo Entertainment has forayed into the devices space, with the launch of a range of bluetooth players pre-loaded with devotional songs and bhajans. (BL).
Bata India Ltd, which has been witnessing a 2-3 per cent growth in the number of footwear sold in the last couple of years, is expecting to see traction in volume sales starting this year. (BL).
Nestle India on Friday said it will set up its ninth factory in the country at Sanand, Gujarat, with an initial investment of about Rs.700 crore over two years. (BL).
The Appointments Committee of Cabinet (ACC) has approved the proposals of the Ministry of Petroleum and Natural Gas and recommended Directors to the boards of Oil India, IndianOil and Oil and Natural Gas Corporation Limited. (BL).
Auto major Tata Motors has reported 34 per cent decline in total domestic sales at 32,938 units in July. The company had sold a total of 50,100 units in the same month last year. Passenger vehicle (PV) sales in domestic market dropped 31 per cent to 10,485 units as compared with July 2018, it said. On the commercial vehicle (CV) front, domestic sales were at 22,453 units as against 34,817 units in the same month last year, down 36 per cent. Exports (CV and PV) in July stood at 3,374 units, lower by 32 per cent over July 2018, it added. (BL).
RPP Infra Projects has received a new order worth Rs107.9cr. The company has won an order from the Bruhat Bengaluru Mahanagara Palike for White— topping of selected roads in Bengaluru City under Phase 3, Package 6; worth Rs107.9cr. This order is a part of the Bruhat Bengaluru Mahanagara Pahke's ambitious project to white-top 93.47 km of roads within the City, the company said in the press note aftermarket hours. (ET).
Corporate Quarterly Earnings
ITC Revenue grew by 5.8% yoy to Rs11,502.8cr. EBITDA grew by 8.7% yoy with EBITDA margin at 39.7%, an expansion of 105bps yoy. Company reported 53.6% yoy growth in the other income and hence, PAT grew by 12.6% yoy to Rs3,173.9cr. (BL).
Power Grid Corporation of India Ltd (PGCIL) Revenue for the quarter grew by 11.3% yoy to Rs9,179.6cr. EBITDA stood at Rs8,268.5cr, up 17.2% yoy with EBITDA margin of 90.1%, a 456bps yoy expansion. Net profit stood at Rs2,502.8cr. (ET).
SBI's Q1FY20 NII came at Rs22,939cr as against Rs21,798.4cr, which is up by 5.2% yoy. The bank has reported a net profit of Rs2,312cr for the quarter. Its GNPA for Q1FY20 came at 7.53%, which is flat qoq. NNPA for the quarter came at 3.07% against 3.01% qoq, which is up by 6bps. The loan growth for the quarter came at 13.8% yoy and declined by 2.3% qoq. PCR improved significantly by 1009bps from 69.25% as on June 2018 to 79.34% as on June 2019. Credit Cost at 2.03% in Q1FY20 (down 52bps yoy). Capital Adequacy Ratio has improved from 12.83% as at June 18 to 12.89% as at June 19. Cost to Income Ratio (Excluding Pension Provisions) has improved from 52.46% in Q1FY19 to 47.26% in Q1FY20. (ET).
HDFC LTD’s Q1FY20 revenue grew by 30.6% yoy to Rs12,990cr. NII grew by 6.9% yoy to Rs2,739cr against Rs2,562cr in Q1FY19. The net profit for the quarter includes profit on sale of investment of Rs1,894cr. Its GNPA for Q1FY20 stood at 1.29%, up by 7bps qoq. (BL).
Aditya Birla Capital’s consolidated profit jumped 27 per cent to Rs 270 crore in the June quarter on the back of growth in businesses across board such as NBFC, insurance and asset management. The NBFC loan book grew by 13 per cent year-on-year to Rs 50,171 crore with SME and retail mix growing by 25 per cent compared with last year. (ET).
Union Bank of India’s net profit saw a 73% increase in June quarter on the back of lower provisions. Its net profit rose to Rs 225 crores in the June quarter from Rs 130 crore a year ago. The bank said it has signed 23 Inter-creditor Agreement (ICA) so far, and it saw a dip in its Net Interest Income (NII), at Rs 2519 crore in the quarter under review against Rs 2626 crore during the corresponding period last year. The NIMS stood at 2.17% this quarter versus 2.34% the previous year Q1.Provisions for bad loans fell to Rs 1431 crore versus Rs 1803 crore last year. The provision coverage ratio (PCR) of the bank stood at a robust 65.88% this quarter. The asset quality of the bank improved with absolute gross non-performing loans falling to Rs 48812 crore in the June quarter versus Rs 50973 crore during the same period last year. The GNPA ratio fell to 15.18% from 16% YoY and the net NPA ratio registered a fall at 7.23% from 8.70% YoY. (ET).
Battery maker Exide Industries on Friday reported a 6.84 % rise in net profit for the first-quarter (Q1) of the financial year 2019-20. The company posted a net profit of Rs 224.29 crore for the quarter ended June 30, 2019, compared to Rs 209.92 crore clocked in the corresponding period of 2018-19. Net turnover during the period under review saw a marginal growth at Rs 2779.25 crore against Rs 2772.46 crore in the corresponding period previous fiscal, according to a company release. Profit before tax for the same quarter ended June 30, 2019, was higher at Rs 335.90 crore compared to Rs 322.12 crore clocked in the corresponding previous quarter ended June 30, 2018. (ET).
Birla Corporation on Friday reported a 68% year-on-year (YoY) increase in consolidated profit after tax (PAT) at Rs 141 crore for the first quarter (April-June) of the financial year 2019-20. The company had posted net profit of Rs 84 crore in the corresponding year-ago period. While consolidated revenue from operations during the quarter under review stood at Rs 1,884 crore, up 14 % YoY, consolidated EBIDTA (earnings before interest, depreciation, tax and amortization) in Q1 FY 2019-20 stood at Rs 402 crore (Rs 270 crore). The company’s consolidated results include those of RCCPL (Reliance Cement Company Pvt Ltd), its wholly-owned material subsidiary. (BL).
Godrej Agrovet Friday reported 4 per cent decline in consolidated net profit at Rs 77.6 crore for the quarter ended June 2019. It had posted a net profit of Rs 81 crore in the year-ago period. Total income rose to Rs 1,712.8 crore during April-June 2019 from Rs 1,488.2 crore in the corresponding period of the previous year, the company said in a statement. (BL).
BEML Ltd on Friday reported narrowing of its consolidated profit to Rs 98.21 crore for the quarter ended June 30. The company had posted a consolidated profit of Rs 162.56 crore in the year-ago period, BEML Ltd said in a filing to the BSE. Its consolidated income during June 2019 quarter increased to Rs 589.10 crore, compared with Rs 457.91 crore a year ago. (BL).
Multiplex chain operator Inox Leisure Friday reported a decline of 26.98 per cent in consolidated net profit at Rs 27.01 crore for the quarter ended June 30, 2019. The company had posted a net profit of Rs 36.99 crore in the year-ago period, Inox Leisure said in a BSE filing. Total income grew 18.75 per cent to Rs 496.13 crore in the quarter under review as against Rs 417.76 crore in the corresponding period last fiscal. (BL).
Non-banking financial company PTC India Financial Services (PFS) reported a slump of 72 per cent in its net profit at Rs 15.64 crore in the first quarter ended June. Company's net profit was at Rs 55.93 crore in the corresponding April-June quarter of the previous fiscal. Total income increased to Rs 352.19 crore in the June quarter of 2019-20, as against Rs 325.19 crore in the same period of 2018-19. The net interest margin (NIM) for the quarter stood at 2.76 per cent, it said in a release. (BL).
Mangalore Refinery and Petrochemicals Ltd (MRPL) recorded loss of Rs.500 crore in the first quarter of 2019-20 as against a net profit of Rs.361.96 crore in the corresponding period of previous fiscal. The gross refining margin (GRM) of the company stood at $(-)0.42 a barrel during the first quarter of 2019-20 as against $8.28 a barrel in the corresponding period of 2018-19. MRPL’s gross revenue from operations stood at Rs.11,200 crore during the Q1 of 2019-20 as against Rs.16,583 crore in the corresponding period of 2018-19. (BS).
Laurus Labs’ profit after tax for the quarter ended June 30 was down by nine per cent to Rs 15.1 crore against Rs 16.6 crore for the first quarter of the last fiscal, the drug maker said here on Friday. Total net revenues during the quarter was up by two per cent at Rs 550 crore. It was Rs 539 crore during the April-June quarter in FY19, the company said in a press release. (ET).
Agrochemicals firm Insecticide India Ltd (IIL) has posted a net profit of Rs.3.6 crore for the first quarter of FY20, about 5.7 per cent higher than the Rs.3.4 crore posted in the previous year period. Its net revenue rose 12.4 per cent to Rs.358 crore (Rs.319 crore). (BL).
Economy and Sector News
Karnataka government has given approval to Goodrich Aerospace Service Pvt. Ltd’s Rs 480 crore investment to establish a unit for manufacturing aircraft evacuation systems, lighting systems, cargo systems, seating systems and electrical power systems. In more news, Hyundai Motor India sold over 16,200 units in the utility vehicle segment in July to take a lead over Maruti Suzuki India (MSI) and Mahindra & Mahindra (M&M), which have for long dominated the vertical. (BL).
The Centre has decided to launch 200 projects worth Rs 3,000 crore in the Northeast in the first 100 days of the new Modi government, DoNER Minister Jitendra Singh said on Sunday. In more news, the country will need to grow by 9 per cent every year for five years continuously and raise the aggregate investment rate to 38 per cent of GDP to achieve Prime Minister Narendra Modi’s target of turning India into a $5-trillion economy. (ET).
Around two lakh jobs have been laid off across automobile dealerships in the country in the last three months as vehicle retailers attempt to tide over the impact of the unprecedented sales slump, according to industry body FADA. In more news, Notwithstanding a moderate improvement in rainfall, kharif sowing across the country failed to register a corresponding increase with total area sown remaining at 788.5 lakh hectares (lh), about 6.6 per cent lower than 844 lh covered in the corresponding week in the previous kharif season, according to data released by the Agriculture Ministry on Friday. (BL).
The Tea Board has announced Rs.12.57 a kg as the district average price for green leaf in the Nilgiris in August. Tea Board Assistant Director R Selvam said the new rate was fixed on the basis of the consolidated auction sale average price of CTC teas from bought leaf factories during July. In more news, Beating all expectations, collections from the Goods & Services Tax (GST) reached over Rs.1.02 lakh crore in July. So far, in three out of four months during the current fiscal year, the collection has been more than Rs.1 lakh crore. According to a Finance Ministry statement, the July collection is nearly 6 per cent more than in the corresponding month last fiscal. During the April-July 2019 period, the domestic component has grown 9.2 per cent over the year-ago period while the GST on imports has come down by 0.2 per cent. The total collection for the period rose 6.83 per cent. (ET).
* ET - Economic Times, BS - Business Standard, BL - Business Line, TOI - Times of India, Mint, IE - Indian Express, BT - Business Today, IE - Indian Express
Global Markets
 

DJIA and NASDAQ Composite

US markets gave back more ground on Friday as Donald Trump's unexpected threat of more tariffs on Chinese imports and a mixed monthly data on non non-farm payrolls weighed on sentiment. The Dow Jones Index closed at 26,485, down 98.41 points by 0.37%. The Standard & Poors 500 index closed at 2,932, down 21.51 points by 0.73%. The Nasdaq Composite Index closed at 8,004, down 107.05 points by 1.32%.

FTSE 100

UK markets finished at their worst levels of the session on Friday after the US President announced overnight that starting from 1 September, the US would start to impose a 10.0% tariff on the $300.0bn-worth of Chinese exports not yet subject to trade levies. The FTSE 100 index closed at 7,407, down 177.81 points by 2.34%.

 
 
Global Indices
02/08/2019 Clsg Chg%
Dow Jones 26,485 -0.37
NASDAQ 8,004 -1.32
FTSE 100 7,407 -2.34
Bovespa 102,674 +0.54
05/08/2019 Latest
(5:43AM IST)
Chg%
Nikkei 21,087 -2.11
Hang Seng 26,919 -2.35

Nikkei

Asian shares extended their losses on Monday as a sharp escalation in the Sino-U.S. trade war kept finiancial markets on edge, while the Japanese yen and bonds held near recent peaks as nervous investors stuck with perceived safe havens. Nikkei is currently trading at 21,087, down 453.83 points by 2.11%.

Precious Metals

Spot gold XAU= was slightly firmer at $1,442.11, within striking distance of a recent six high of $1,452.60 on Monday.

Base Metals

The three-month copper price on the London Metal Exchange was down during morning trading on Friday August 2, falling to its lowest level since June 10, while zinc futures shed 1.4% of Thursday’s gains.

Crude Oil

Oil prices fell on Monday amid concerns about weaker crude demand after U.S. President Donald Trump said he would impose tariffs on more Chinese imports, potentially ramping up a trade war between the world’s two largest economies.

 
 
 

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Hrishikesh Yedve D: 91 22 2858 3207
Vrinda Aditya D: 91 22 2858 3209
Neeraj Sharma D: 91 22 2858 3208
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Email: retailresearch@acm.co.in

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Disclosures
ACMIIL/its associates and its Research analysts have no financial interest in the companies covered on the report. ACMIIL/ its associates and Research analysts did not have actual/beneficial ownership of one per cent or more in the companies being covered at the end of month immediately preceding the date of publication of the research report. ACMIIL/its associates or Research analysts have no material conflict of interest, have not received any compensation/benefits for any reason (including investment banking/merchant banking or brokera3ge services) from either the companies concerned/third parties with respect to the companies covered in the past 12 months. ACMIIL/its associates and research analysts have neither managed or co-managed any public offering of securities of the companies covered nor engaged in market making activity for the companies being covered. Further, the companies covered neither are/nor were a client during the 12 months preceding the date of the research report. Further, the Research analyst/s covering the companies covered herein have not served as an officer/director or employee of the companies being covered.

Disclaimer:
This report is based on information that we consider reliable, but we do not represent that it is accurate or complete and it should not be relied upon such. ACMIIL or any of its affiliates or employees shall not be in any way responsible for any loss or damage that may arise to any person from any inadvertent error in the information contained in the report. To enhance transparency we have incorporated a Disclosure of Interest Statement in this document. This should however not be treated as endorsement of the views expressed in the report.