Morning Notes
29th Oct, 2019
 

Trading Range:

Nifty opened gap up at 11662 on Sunday and made a high and low of 11672 and 11605 respectively before closing positive at 11627.

Review/Outlook:

For the day, support for Nifty exists at 11580 and 11490 levels whereas resistance for Nifty stands at 11670 and 11710 levels.

Review/Outlook:

Bank Nifty opened gap up at 29605, made a high of 29644, low of 29447, and closed positive at 29516. For the day, support for Bank Nifty exists at 29300 and 29000 levels whereas resistance for Bank Nifty stands at 29700 and 30000 levels.

Market Scan
Benchmark Indices
Index Clsg Chg%
Sensex 39,250 +0.49
Nifty 11,627 +0.37
BSE 200 4,872 +0.48
BSE Midcap 14,441 +0.69
BSE Smallcap 13,310 +1.20
Dow Jones 27,091 +0.49
NASDAQ 8,326 +1.01
 

DERIVATIVES INDICATORS FOR OCT 29, 2019:

NIFTY 11627.15 (+43.25) (+0.37%)
NIFTY OCT FUTURE 11625.00 (2.15 Points Discount)
NIFTY PCR - OI 1.22(+0.01)
NIFTY OPEN INTEREST 1.63Cr. (+0.52%)
INDIA VIX 15.58 (-4.03%)
NIFTY ROLLOVER 15%

NIFTY OPTIONS ACTIVITY (31-OCT SERIES)

CALL 11600 CE -1.46 lac Shares
CALL 11650 CE +1.56 lac Shares
PUT 11600 PE +3.19 lac Shares
PUT 11500 PE +1.82 lac Shares
Sectoral Indices (BSE)
Index Clsg Chg%
Auto 18,163 +1.46
Bankex 33,412 +0.42
PSU 6,869 +0.29
Healthcare 12,985 +0.67
IT 14,659 +0.59
 
Market Turn Over (`cr)
Index 25/10 24/10
BSE Cash 452 2,474
NSE Cash 5,804 41,587
NSE F&O 120,143 2,881,937
BSE Delivery % 61.10 39.67
Advances / Decines BSE Cash
Adv(%) Dec(%)
BSE 100 74.26 25.74
BSE 200 73.13 26.37
BSE 500 78.40 21.00
Total BSE 71.60 22.49
 
Commodities, Forex & Debt
Clsg Chg%
Crude Oil NYMEX $ bl 55.82 +0.02
Gold Rs./ 10 Gms 38293.00 +0.06
Silver Rs./ Kg 46491.00 +0.40
Rs.- US $ 70.75 -0.34
Rs.- Euro 78.53 -0.39
FII (Rs cr )
25/10* 24/10*
FIIs -193.38 -149.07
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        92.00        6.88       151.00        9.62    1,77,868.00      14,506.55   -2.74
Index Options  19,214.00  1,309.11  19,309.00  1,315.25    6,71,789.00      54,249.34   -6.14
Stock Futures    3,142.00     160.05    2,139.00     123.56  15,54,070.00      93,211.76  36.49
Stock Options    1,887.00     136.96    1,930.00     138.49    1,14,508.00        6,562.43   -1.53
Total  24,335.00  1,613.00  23,529.00  1,586.92  25,18,235.00   1,68,530.08  26.08
Corporate News
More than a year after hearings in an arbitration initiated by Cairn Energy against Rs.10,247-crore retrospective tax demand ended, the three-member Arbitral Tribunal has indicated that the award will be further delayed to mid-2020, the British firm said on Monday. (BL).
Reliance Industries Ltd’s move to set up a wholly-owned subsidiary for its digital initiatives, with a capital infusion of Rs.1.73-lakh crore, could facilitate early monetisation in the new company. (ET).
Drug major Dr Reddy’s on Saturday said it has received four observations from the US health regulator USFDA for its facility at Srikakulam in Andhra Pradesh. The audit of the company’s API Srikakulam Plant (SEZ) by the United States Food and Drug Administration (USFDA) was completed on Friday, the Hyderabad-based pharma major said in a regulatory filing. Dr Reddy’s further said that it would address the four concerns within the stipulated timeline. (BL).
State-owned Coal India Ltd (CIL) will be switching over to mechanised transport of coal through piped conveyor belts in its large mines by 2023-24. This will replace the existing road movement of the dry fuel. (ET).
The government is looking into state-owned Bharat Petroleum Corp Ltd’s (BPCL) investments in a gas block in Mozambique and has not yet formally given its approval to the firm for further spendings, sources said. (BL).
Bengaluru-headquartered biopharmaceuticals company Biocon Ltd has moved up to sixth spot in the Top 10 Global Biotech Employers ranking for 2019. (ET).
Jubilant Cadista Pharmaceuticals Inc is recalling 63,216 bottles of Pantoprazole Sodium delayed-release tablets in the American market and Puerto Rico, as per the latest report of the US health regulator. (BL).
Mahindra Two Wheelers Europe on Friday announced that it will take 100 per cent ownership of France-based Peugeot Motocycles (PMTC) for an undisclosed amount. Mahindra Two Wheelers, a subsidiary of Mahindra & Mahindra Ltd, had acquired a 51 per cent equity stake in PMTC from Groupe PSA in 2015. Then the company had infused £15 million, or ₹110 crore, into Peugeot to finance projects implemented through the partnership, and had spent £13 million on the purchase of shares held by PS. (BL).
The National Company Law Appellate Tribunal (NCLAT) had directed the Enforcement Directorate (ED) and Ministry of Corporate Affairs (MCA) to reach a consensus on settling the conflict in the provision of Prevention of Money Laundering Act with regard to attachment of property under insolvency. Hearing a case filed by JSW Steel at NCLAT, a three-member bench headed by Chairperson Justice SJ Mukhopadhaya said there was no question of amendment of laws, and both the wings of the central government should settle the issue. (ET).
Diversified conglomerate Piramal Enterprises Ltd (PEL) will raise fresh capital of Rs.5,400 crore through a rights issue and preferential allotment of compulsory convertible debentures (CCDs). Of this, Rs.1,750 crore will be raised through a preferential allotment of CCDs (at a conversion price of Rs.1,510 per share) to Canadian institutional investor Caisse de dépôt et placement du Québec (CDPQ). The rights issue of Rs.3,650 crore, at Rs.1,300 per share, is intended to give an opportunity to all its existing shareholders to participate in the capital raise at an attractive price. (ET).
The Supreme Court verdict allowing the Centre to recover Rs 92,641 crore in total adjusted gross revenue (AGR) from telecom operators in India is a massive blow to Bharti Airtel and Vodafone Idea Ltd. (ET).
Quarterly Earnings
ICICI Bank's net profit dropped 28% to Rs 655 crore in the quarter ended September 2019 from Rs 909 crore a year ago. Tax expenses increased more than ten times to Rs 3,712 crore compared to Rs 347 crore a year ago. These tax expenses included the one-time additional charge of Rs 2,920 crore due to re-measurement of accumulated deferred tax assets consequent to a reduction in marginal tax from 35% to 25%. Excluding the impact of one-time additional charge due to re-measurement of accumulated deferred tax, profit after tax would have been Rs 3,575 crore a four fold increase from Rs 909 crore a year ago as core operating profit (profit before provisions and tax, excluding treasury income) grew by 24% year-on-year to Rs 6,533 crore from Rs 5285 crore a year earlier. NII increased 26% to Rs 8,057 crore from Rs 6,418 crore a year earlier. Net interest margin improved to 3.64% from 3.33% a year earlier. Non-interest income increased to Rs 3,854 crore compared to Rs 3,191 crore a year earlier led by a 16% growth in fee income. (BL).
Pharma firm Pfizer Ltd on Saturday reported a 61.01 per cent rise in net profit to Rs 154.25 crore for the July-September quarter compared to that of Rs 95.80 crore in the same quarter of last year. Its revenue from operations was at Rs 567.06 crore in the quarter, up 9.10 per cent compared to Rs 519.74 crore in the year-ago quarter. (BS).
IndiGrid, India's first power sector infrastructure investment trust (InvIT), has reported a consolidated revenue of Rs 373 crore for the quarter ended September 30, up 81 per cent quarter-on-quarter while the consolidated EBITDA (earnings before interest, tax, depreciation and amortisation) was Rs 347 crore up 84 per cent. The board of Sterlite Investment Managers Ltd acting as investment manager of IndiGrid approved Rs 3 distribution per unit for Q2 FY 20 payable as interest. (BL).
State Bank of India’s net profit rose to Rs 3,012 crore from Rs 945 crore a year ago on the back of a one-time gain from the stake sale in SBI Life Insurance. The bank got Rs 3,500 crore from its 4.5 per cent stake sale in SBI Life. It made provisions for a failed power company with an outstanding of Rs 3,800 crore and a stressed nonbanking finance company (NBFC) with a total outstanding of Rs 7,000 crore. The asset quality of the bank surprised on the positive side with fresh slippages coming in at Rs 8,800 crore versus Rs 10,725 crore a year ago. It was at Rs 16,212 crore at the end of the June quarter. The gross NPA ratio fell 276 basis points to 7.19 per cent against 9.95 per cent in the same period last year. The net NPA ratio was at 2.79 per cent and the overall PCR ratio increased to 81.23 per cent. A basis point is one-hundredth of a percentage point. (ET).
Tata Motors on Friday reported a narrower loss for the second fiscal quarter, on the back of a significant improvement at its marquee Jaguar Land Rover business which is witnessing a recovery in China and as a cost-cutting programme began to deliver results. India’s largest automobile company by revenue posted a consolidated loss of Rs 216.5 crore for the quarter through September, compared with Rs 1,048.8 crore a year earlier. Revenue fell 9 per cent from a year earlier to Rs 65,432 crore, but topped expectations of Rs 64,150 crore. Earnings before interest, tax, depreciation and amortisation improved 13 per cent to Rs 7,046 crore. (BL).
HDFC Asset Management Company (AMC) on Friday reported a 79 per cent jump in profit after tax at Rs 368.3 crore in the three months ended September 30, 2019. In comparison, the fund house had posted a profit after tax (PAT) of Rs 205.9 crore in the year-ago period. Total income rose by 7 per cent to Rs 549 crore in July-September quarter of the ongoing fiscal from Rs 515.3 crore in the same period last fiscal. The total asset managed by the fund house rose 25 per cent to Rs 3,66,200 crore at the end of September this year from Rs 2,92,600 crore in the same period last year. Actively managed equity AUM (assets under management) stood at Rs 1.64 lakh crore in the quarter under review with a market share of nearly 16 percent, making the company largest equity mutual fund manager. (ET).
HeidelbergCement India on Friday reported a 16.11 per cent increase in net profit at Rs 58.15 crore for the second quarter ended September 2019. The company had logged a net profit of Rs 50.08 crore in the July-September period a year ago, HeidelbergCement India said in a BSE filing. Net sales during the quarter under review came in at Rs 519.51 crore, up 8.34 per cent from Rs 479.50 crore in the corresponding period of the previous fiscal. (BL).
Drug firm Jubilant Life Sciences on Friday reported a 18.88 per cent rise in consolidated net profit at Rs 249.39 crore for the quarter ended September 30, 2019. The company said its board has also approved demerger of the Life Science Ingredients business. Jubilant Life had posted a net profit of Rs 209.77 crore in the corresponding July-September period of the previous fiscal, it said in a filing to the BSE. Consolidated total revenue from operations stood at Rs 2,265.93 crore for the quarter under consideration as against Rs 2,269.49 crore in the same period a year ago. The board of the company has approved the recommendations of a committee constituted to consider the option of reorganising the businesses of the company. (BL).
FMCG firm Marico on Friday reported a 17.12 per cent rise in its consolidated net profit at Rs 253 crore for the quarter ended September 2019. The company had posted a net profit of Rs 216 crore in the July-September quarter a year ago. The company had posted a net profit of Rs 216 crore in the July-September quarter a year ago, Marico said in a BSE filing. Net sales during the quarter under review were down marginally to Rs 1,829 crore as against Rs 1,837 crore in the corresponding quarter of the previous fiscal. (BL).
Textile major Arvind Ltd on Friday reported a consolidated net profit of Rs 49.68 crore for the September quarter. The company had posted a net profit of Rs 56.10 crore in the July-September quarter a year ago, the company said in a BSE filing. Net sales during the quarter stood at Rs 1,962.19 crore as against Rs 1,792.91 crore in the year-ago quarter. The results are not comparable with the previous year's period because of demerger of its branded apparel to Arvind Fashions Ltd with effect from November 30, 2018. (BS).
PNB Housing Finance's net interest income and net profit grew by 36% and 45% respectively year-on-year. Asset quality for housing finance companies (HFC) may worsen for both retail loan as well as construction finance segments, rating company ICRA said, pointing out that gross non-performing assets of HFCs’ home loan segment are likely to rise to 1.3-1.5% over the medium term from the current level of 1.2%. In contrast, PNB Housing’s gross NPA ratio stood at 0.84% of total loans as on September against 0.45% a year back, better than the industry average. Net NPA stood at 0.65% as against 0.35% in the same period. (ET).
Infibeam Avenues’ consolidated net profit jumped by 241% in the September quarter. In the second quarter, consolidated profit stood at Rs 25.9 crore compared with Rs 7.6 crore in the same corresponding period of the last financial year. During the quarter, the company recorded strong growth in operating margins and profitability. It also declared a 10% dividend. As per the company, Infibeam’s digital payment operational performance during the Q2 grew by 12% on a YoY basis, as its volume of transactions processed stood at Rs 14,560 crore. (ET).
Bharti Airtel’s Africa unit posted a 39 per cent increase on-year in net profit to reach $90 million for the quarter ended September 2019 on-year, on revenue of $844 million on constant currency terms. The Africa unit, which crossed the 100 million customer mark in July, said its revenue growth of 10 per cent in reported currency was driven by double-digit growth in Nigeria and East Africa, partially offset by a slight decrease in Rest of Africa. Airtel Africa’s data revenue was up 39 per cent at $229 million on-year and was the largest contributor to growth owing to an increasing number of customers taking to high-speed LTE services, resulting in a 57 per cent growth in data usage. Data average revenue per user (Arpu) rose to 2.5$ up 20 per cent in constant currency terms for the September ended quarter, on-year. (BL).
Alembic Pharmaceuticals on Friday reported 25.12 per cent increase in consolidated profit after tax at Rs 250.45 crore in the second quarter ended September 30. The company had posted a consolidated profit after tax of Rs 200.09 crore in the same quarter last fiscal, Alembic Pharmaceuticals said in a regulatory filing. Revenue from operations during the period under review stood at Rs 1,240.87 crore as against Rs 1,127.06 crore in the year-ago quarter, up 10 per cent. Revenue from India formulations business for the quarter was Rs 391 crore, as against Rs 385 crores for the last year, the company said. The API business grew 31 per cent to Rs 204 crore as against Rs 155 crore in the same period last fiscal, it added. The company said it received six abbreviated new drug (ANDA) approvals during the quarter while five ANDAs were filed. (BL).
Economy and Sector News
Indian capital markets witnessed a net inflow of over Rs 3,800 crore by foreign portfolio investors (FPI) in October so far. This came after the Government had taken steps to revive domestic demand coupled with positive global cues. The depositories data showed that overseas investors pumped in a net amount of Rs 3,769.56 crore into equities and Rs 58.4 crore in the debt segment, taking the total net investment to Rs 3,827.9 crore in this month so far. FPIs have been net buyers for the second consecutive month. In September, FPIs invested a net Rs 6,557.8 crore in the domestic capital markets (both equity and debt). (BL).
India witnessed a jump of nearly 50 per cent in organic product exports touching the Rs 5151 crore-mark ($757 million) in 2018-19. According to estimates by Agricultural and Processed Food Products Export Development Authority of India (APEDA), flax seeds, sesame, soybean, tea, medicinal plants, rice and pulses such as arhar and chana are the key organic food products that drove this growth. India produced around 2.67 million tonnes of certified organic products including oilseeds, sugarcane, cereals & millets, cotton, pulses, medicinal plats, tea, fruits, spices, dry fruits, vegetables and coffee. (ET).
The country’s civil aviation regulator DGCA, on Monday, asked IndiGo not to use such A320 Neo planes which are fitted with PW engines already used for over 3,000 hours, or face grounding of aircraft, officials said. A Directorate General of Civil Aviation (DGCA) official said that there are 16 aircraft in IndiGo’s fleet in which both the Pratt and Whitney (PW) engines have been used for more than 2,900 hours. All such 16 aircraft have to be fitted with at least one modified LPT engine within next 15 days, said the official. (BL).
GVK Airports has signed definitive agreements on Sunday with three investors – ADIA, Abu Dhabi; PSP Investments, Canada and the NIIF, India for an aggregate investment of Rs.7,614 crore. Proceeds from this transaction will be used by GVK to primarily retire debt obligations of its holding companies significantly and fund the purchase of additional shares in MIAL, from our partners - Bidvest and ACSA. GVK will continue to manage both airports and also they will be branded as GVK Airports. (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 climbed to a record on Monday as rising optimism for a trade deal with China combined with solid earnings and bets the Federal Reserve will cut rates. Treasuries slumped at the start of a a week packed with more results and central bank decisions. The Dow Jones Index closed at 26,091, up 132.66 points by 0.49%. The Standard & Poors 500 index closed at 3,039, up 16.87 points by 0.56%. The Nasdaq Composite Index closed at 8,326, up 82.87 points by 1.01%.

FTSE 100

UK markets finished higher, tracking fresh record highs on Monday for some of Wall Street's main stock market gauges and after the EU decided to grant the UK a three-month extension to the deadline for Brexit. The FTSE 100 index closed at 7,331, up 6.81 points by 0.09%.

 
 
Global Indices
28/10/2019 Clsg Chg%
Dow Jones 27,091 +0.49
NASDAQ 8,326 +1.01
FTSE 100 7,331 +0.09
Bovespa 108,187 +0.77
29/10/2019 Latest
(4:12AM IST)
Chg%
Nikkei 22,867 +0.30
Hang Seng 26,891 +0.84

Nikkei

Asian shares started trading on Tuesday early in the morning on a positive note as the investors will be watching the US markets closely. Nikkei is currently trading at 22,867, up 67.46 points by 0.30%.

Precious Metals

Gold futures decreased 0.7% to $1,494.80 an ounce on Monday.

Base Metals

The three-month nickel price on the London Metal Exchange was lower at the close of trading on Monday October 28, falling by a little less than 2% against high turnover, while copper’s outright price breached nearby resistance.

Crude Oil

Oil futures settled lower on Monday, pulling back as last week’s strong climb lifted crude prices to a roughly one-month high.

 
 
 

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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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