Morning Notes
22nd Oct, 2019
 

Trading Range:

Nifty opened flat at 11580 on Friday and made a high and low of 11685 and 11553 respectively before closing positive at 11662.

Review/Outlook:

For the day, support for Nifty exists at 11590 and 11500 levels whereas resistance for Nifty stands at 11720 and 11780 levels.

Review/Outlook:

Bank Nifty opened gap down at 28955, made a high of 29249, low of 28864, and closed positive at 29120. For the day, support for Bank Nifty exists at 28800 and 28500 levels whereas resistance for Bank Nifty stands at 29300 and 29500 levels.

Market Scan
Benchmark Indices
Index Clsg Chg%
Sensex 39,298 +0.63
Nifty 11,662 +0.65
BSE 200 4,878 +0.87
BSE Midcap 14,420 +1.78
BSE Smallcap 13,127 +1.65
Dow Jones 26,828 +0.21
NASDAQ 8,163 +0.91
 

DERIVATIVES INDICATORS FOR OCT 22, 2019:

NIFTY 11661.85 (+75.50) (+0.65%)
NIFTY OCT FUTURE 11670.00 (8.15 Points Premium)
NIFTY PCR - OI 1.44(+0.04)
NIFTY OPEN INTEREST 1.53Cr. (-2.22%)
INDIA VIX 15.92 (+0.31%)
NIFTY ROLLOVER 11%

NIFTY OPTIONS ACTIVITY (31-OCT SERIES)

CALL 11700 CE +0.72 lac Shares
CALL 11900 CE +2.01 lac Shares
PUT 11600 PE +4.96 lac Shares
PUT 11500 PE +5.31 lac Shares
Sectoral Indices (BSE)
Index Clsg Chg%
Auto 17,882 +0.98
Bankex 32,901 +0.37
PSU 6,860 +2.18
Healthcare 12,635 +1.06
IT 15,453 +0.66
 
Market Turn Over (`cr)
Index 18/10 17/10
BSE Cash 2,910 4,517
NSE Cash 42,533 37,704
NSE F&O 745,110 2,650,662
BSE Delivery % 38.94 34.97
Advances / Decines BSE Cash
Adv(%) Dec(%)
BSE 100 74.26 23.76
BSE 200 76.12 22.39
BSE 500 77.25 21.76
Total BSE 58.66 34.69
 
Commodities, Forex & Debt
Clsg Chg%
Crude Oil NYMEX $ bl 53.31 -0.87
Gold Rs./ 10 Gms 37890.00 -0.52
Silver Rs./ Kg 45431.00 -0.05
Rs.- US $ 70.91 -0.42
Rs.- Euro0 79.06 -0.20
FII (Rs cr )
18/10* 17/10*
FIIs +1274.38 -8.48
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       45,273.00       3,222.72       52,595.00       3,782.63    1,47,248.00     11,896.88    (559.91)
Index Options  19,67,355.00  1,36,609.42  19,74,721.00  1,36,985.93    7,40,981.00     59,690.65    (376.51)
Stock Futures    2,69,466.00     14,129.29    2,62,246.00     13,473.47  15,34,237.00     92,664.79     655.82
Stock Options    1,33,587.00       7,352.83    1,32,640.00       7,295.72       98,752.00       5,614.71       57.11
Total  24,15,681.00  1,61,314.26  24,22,202.00  1,61,537.75  25,21,218.00  1,69,867.03    (223.49)
Corporate News
TVS Motor Company, India’s third largest two wheeler company by volumes, has announced the launch of two new flagship initiatives —TVS Racing MotoSoul and TVS Racing Performance Gears and Accessories — to deepen its engagement with customers, raise awareness of the brand and boost its sales. (BL).
Security agencies are uncomfortable with the Centre’s plan to sell BPCL to private entities as the company controls the Assam-based Numaligarh refinery, which is located in a sensitive and restive area. (ET).
Promoters of Essel Group have pumped in Rs 200 crore from their personal wealth in a bid to ring-fence Zee. This comes even as the Company is in the process of seeking legal advice to take appropriate action against a bank that adjusted Zee’s Rs 200-crore fixed deposit against dues of related entities within the group. (BL).
Larsen & Toubro on Friday said it has signed an agreement to buy the entire stake of Old Lane Mauritius III Ltd in L&T Infrastructure Development Projects (L&T IDPL) for Rs.47.9 crore. The share purchase agreement was executed on Thursday, the company said in a filing to BSE. The share purchase agreement was executed on Thursday, the company said in a filing to BSE. (ET).
Adani Enterprises has awarded a contract to an Australian rail company as the conglomerate steps up infrastructure spending to support its new thermal coal mine in Queensland state. In more news, Adani Green Energy MP (AGEL), a wholly owned subsidiary of Adani Green Energy has commissioned a 50 MW wind energy generation capacity plant having Power Purchase Agreement (PPA) with SECI for 25 years. (ET).
Sajjan Jindal-headed JSW Steel has raised fresh funds of about Rs.2,000 crore through a private placement of 10-year bonds at 8.79 payable semi-annually. The Committee of Directors of Board in a meeting held on Friday approved the allotment of 20,000, 8.79 per cent rated, listed, secured, redeemable, non-convertible debentures bearing a face value of Rs.10 lakh each at par to the investors identified by the Committee aggregating to Rs.2,000 crore, said the company in a statement. (BL).
Brookfield Asset Management has acquired some assets owned by Hotel Leelaventure in one of India’s largest hotel deals worth nearly Rs.4,000 crore. The deal was announced in March but could not be completed due to objections raised by some investors including ITC. But, in September, the Securities Appellate Tribunal quashed ITC’s appeal against the sale of assets. (ET).
The State Bank of India (SBI) will conduct an e-auction of 11 bad loan accounts on November 7 to recover dues of Rs 466.49 crore. In terms of the bank's revised policy on sale of financial assets, in line with the regulatory guidelines, the bank will place 11 accounts for sale to ARCs/banks/NBFCs and FIs, SBI said in an auction notice. The bank said the financial assets were showcased on October 12 and the e-auction will take place on November 7. (ET).
Fresh allegations against Infosys from a group of employees who call themselves “Ethical Employees’’ will certainly hurt the company but what is more significant about these charges is that this group’s claim that they have enough documentary evidence to nail any denial from the company. (BL).
US-based pharma MNC Abbott is set to make hepatitis C virus detection faster and cheaper in India. (ET).
Berger Paints to acquire 95.53 percent stake in STP Limited at Rs 167.5 crore. The target company manufactures and supplies construction chemicals and building materials. (BQ).
Quarterly Earnings
Oberoi Realty Ltd on Sunday posted a 35.4 per cent decline in consolidated net profit at Rs 138.07 crore for the quarter ended September 30, 2019. The company had reported a consolidated net profit of Rs 213.83 crore in the year-ago period, Oberoi Realty Ltd said in a filing to the BSE. Total income of the company during the July-September period declined to Rs 505.09 crore, over Rs 619.78 crore a year ago. (BL).
Shree Cement Ltd on Saturday posted a five-fold rise in consolidated profit at Rs 313.30 crore for the quarter ended September 30, 2019. The company had posted a consolidated profit of Rs 63.77 crore in the year-ago period, it said in a filing to the Bombay Stock Exchange (BSE). The consolidated total income of the company increased to Rs 3,063.08 crore, over Rs 2,907.02 crore in the year-ago period. (BS).
Digital cable TV and broadband service provider GTPL Hathway Ltd (GTPL) registered a consolidated net profit of Rs.35 crore for the second quarter ended September 2019, up from Rs.16 crore reported in the corresponding period last year, showing a rise of about 118 per cent. The company reported a consolidated total income at Rs.616 crore, up by 94 per cent on year-on-year basis from Rs.317 crore in the same quarter last year. (BL).
The consolidated net profit of Reliance Industries Ltd, the oil to telecom conglomerate owned by billionaire Mukesh Ambani, rose 18.3 per cent in the July-September quarter to Rs.11,262 crore from a year ago, as revenue from operations jumped 4.8 per cent to Rs.1,63,854 crore. The consolidated net profit was Rs.9,516 crore on an operational revenue of Rs.1,56,291 crore in the second quarter of FY19. (ET).
HDFC Bank on Saturday reported a 26.8 per cent year-on-year (YoY) rise in standalone net profit at Rs 6,345 crore for the September quarter after providing Rs 2,652.40 crore for taxation.The private lender had reported Rs 5,005.73 crore profit in the corresponding quarter last year. India’s most-valued lender reported a 14.89 per cent rise in net interest income (NII) at Rs 13,515.0 crore crore compared with Rs 11,763.4 crore in the same quarter last year. Net interest margin (NIM) for the quarter came in at 4.2 per cent. (BL).
L&T Finance Holdings reported a 69 per cent fall in net profit in the second quarter due to impact of new corporate tax rules. Profit declined to Rs.174 crore in the three-months ended September from Rs.560 crore a year ago. Earnings increased 15 per cent to Rs.647 crore before the one-time tax impact. The government reduced the corporate tax rate to 25.17 per cent from 34.94 per cent in September. The quarter’s results reflect a one-time impact of Rs.473 crore due to the reversal of deferred tax assets as of April 1, 2019. L&T Finance’s net interest margin plus fees remained at 6.86 per cent. While asset quality remained stable with gross stage 3 at 5.98 per cent and net stage 3 assets at 2.83 per cent, its provision coverage ratio fell to 54 per cent from 62 per cent. (ET).
ICICI Lombard General Insurance reported a 5% increase in net profit during the quarter ended September 30, 2019 due to long-term motor policies and losses from natural disasters in various states. The company’s net profit rose to Rs 307.9 crore from .Rs 293 crore during the same quarter a year ago. The board has announced a payment of interim dividend of .Rs 3.5 per equity share of face value of Rs 10 each, for the half-year ended on September 30, 2019. Combined ratio, a measure of profitability, rose 102.6% from 101.1% as a result of increase in claims. The company maintained its guidance on return on average equity at over 20%. (BL).
Ambuja Cements on Friday reported 34.80 per cent rise in consolidated net profit to Rs 533.85 crore for the third quarter ended September 30. The company, which follows January to December financial year, had clocked a net profit of Rs 396.01 crore in the same period a year-ago, Ambuja Cements said in a BSE filing. Its total income was at Rs 6,190.14 crore, up 1.51 per cent, in the period under review as against Rs 6,097.53 crore in the corresponding quarter of the previous fiscal. (BL).
Strong operating performance and likely divestments of an education business and a part of the promoters’ stake in Zee Entertainment Enterprises (ZEE) should help the cashstrapped owners of India’s biggest listed media company repay Rs 7,000 crore of outstanding debt, which is due in six months. In the quarter ended September 30, the company posted a net profit of Rs 412.09 crore, up 6.7 per cent from Rs 386.10 crore in the corresponding quarter of the previous fiscal. Also, net revenues were up 7.7 per cent to Rs 2,190.13 crore, compared with Rs 2,034.79 crore in the year-ago period. (BL).
Auto-parts maker Rane (Madras) Ltd reported an 80 per cent fall in its standalone net profit at Rs.2.7 crore for the quarter ended September 30, compared with Rs.13.8 crore in the year-ago period, on the back of sluggish demand in the domestic auto industry. The company saw a 31 per cent drop in its sales to Indian OE customers. Sales to international customers also declined 14 per cent, driven by a drop in volume for die-casting products. Volumes to after-market customers declined 16 per cent. Total net revenue stood at Rs.282 crore (Rs.356 crore), a decline of 21 per cent. EBITDA stood at Rs.24.2 crore (Rs.40.5 crore), while EBITDA margin was lower at 8.6 per cent when compared with 11.4 per cent. (BL).
Diversified conglomerate Piramal Enterprises posted a 15.3 per cent increase in its consolidated net profit to Rs.554.08 crore in the second quarter of the fiscal as against Rs.480.42 crore a year ago. The Ajay Piramal led company, with interests in sectors including financial services and pharmaceuticals, registered a 15 per cent increase in its revenue to Rs.3,604 crore in the quarter ended September 30, 2019 as against Rs.3,144 crore a year ago. Its financial services business posted net sales of 15 per cent to Rs 1,954 crore in the July to September quarter this year against Rs.1,732 crore in the corresponding period last fiscal. Its loan book stood at Rs.53,055 crore as of September 30, 2019. The housing financial loan book grew three times on an annual basis to Rs.6,393 crore by September. It also made repayments of Rs.19,400 crore in the past year in the wholesale book. Overall Pharma revenue grew 19 per cent year on year to Rs.1,316 crore during the second quarter this fiscal. Its global pharma business grew 17 per cent in the quarter under review to Rs.1,204 crore. (BL).
UltraTech Cement, an Aditya Birla Group company, reported 63 per cent increase in September quarter consolidated net profit at Rs 579 crore against Rs 356 crore logged in the corresponding period last year on the back of lower cost and higher realisation. Net sales were up four per cent at Rs 9,491 crore (Rs 9088 crore). The company’s board plans to invest Rs 940 crore in increasing grinding capacities at its plants in Bihar and West Bengal by six lakh tonnes per annum each and putting up a new grinding unit of 2.2 million tonnes per annum in Odisha. These projects are expected to be completed between January and March 2021. (BL).
Economy and Sector News
German luxury car maker Mercedes Benz India said it was bullish on the Indian market as sales had surpassed 10,000 units annually for the fifth year in a row. In a move to strengthen its footprint in the market, the company had recently set up its largest integrated 3S (Sales, Service and Spares) dealership in Tamil Nadu in partnership with Sundaram Motors at Ambattur in the city. (BL).
Tea Board Coonoor has served a suspension order on Paramount Tea Marketing (SI) Pvt Ltd for breaching the provisions of the Tea Marketing Control Order, 2003. Per the order served on Friday, the tea brokering company cannot sell teas at any of the registered auction centres in South India for a period of three months. According to the order, on June 12, 2019, officials of the Board on inspection at Nilgiri MG Tea Industry, Sholur Village in Ooty, came across four barrels of food colour (Tartrazine) and other adulterant materials stored in a room apart from some new sandwich bags with Swamy & Swamy Plantations Pvt Ltd (High Field Tea – CTC) imprinted on them. (ET).
India has increased its ethanol blending programme (EBP) by many times according to Minister of Petroleum and Natural Gas Dharmendra Pradhan. Speaking at the 2nd Annual India Leadership Summit of the US-India Strategic Partnership Forum, Pradhan said, “From less than 1 per cent ethanol blending in 2015, we have increased our EBP to 6 per cent. We are working to push up the percentage even further.”. (BL).
The closure of Vedanta’s copper smelter plant at Tuticorin in Tamil Nadu has led to a rise in imports of copper, making the country a net importer of refined copper after 18 years, Care Ratings has said. India used to be a net exporter of copper cathodes till FY18. Now with the closure of the Tuticorin smelter, the drop in domestic production has led to the domino effect of increasing the country’s imports and decreasing its exports. India has become a net importer of refined copper after 18 years,” Care Ratings has said. (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 inched higher Monday to start a busy week of corporate earnings, while investors continued to track developments in the U.K.’s divorce from the European Union. The Dow Jones Index closed at 26,828, up 57.44 points by 0.21%. The Standard & Poors 500 index closed at 3,007, up 20.52 points by 0.69%. The Nasdaq Composite Index closed at 8,163, up 73.44 points by 0.91%.

FTSE 100

UK markets finished in the green on Monday, even after the speaker of the House of Commons decided against allowing a meaningful vote on the government's Brexit proposal, helped by positive headlines around the US-China trade negotiations. The FTSE 100 index closed at 7,164, up 13.07 points by 0.18%.

 
 
Global Indices
18/10/2019 Clsg Chg%
Dow Jones 26,828 +0.21
NASDAQ 8,163 +0.91
FTSE 100 7,164 +0.18
Bovespa 106,022 +1.24
22/10/2019 Latest
(4:00AM IST)
Chg%
Nikkei 22,548 +0.25
Hang Seng 26,725 +0.02

Nikkei

Asian shares on started trading early on Tuesday morning on a positive note as investors will be watching the US markets closely. Nikkei is currently trading at 22,548, up 56.22 points by 0.25%.

Precious Metals

December gold falls $6 or 0.4% on Monday, to settle at $1,488.10/oz.

Base Metals

The three-month lead price on the London Metal Exchange was the standout performer on Monday October 21, closing at its highest level since July 2018 and breaching $2,200 per tonne despite moderate turnover.

Crude Oil

Oil futures settled at a nearly two-week low Monday, as investors failed to shake worries that growing signs of economic weakness will eventually hurt demand for crude oil.

 
 
 

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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 brokerage 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.

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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.