Sensex, Nifty end at 5-month high; Ambuja, ACC, Sun Pharma up 4%

3:30 pm Market closing: Benchmark indices ended at 5-month closing highs on Monday, with the Sensex rising 198.76 points to 28439.28. Nifty Midcap also ended at fresh closing high.

The 50-share NSE Nifty gained 60.10 points at 8801.05. About 1862 shares advanced against 1068 declining shares on the BSE.

Ambuja Cements, Sun Pharma, ACC, ICICI Bank and Aurobindo Pharma were top gainers, up 3-4.5 percent followed by Adani Ports, Axis Bank and BHEL while Dr Reddy's Labs, Cipla, ONGC, Hindalco, Coal India and SBI were under pressure.

3:20 pm Rangarajan on NPA: Former Reserve Bank of India Governor C Rangarajan today said banks cannot escape from the responsibility of controlling Non-Performing Assets (NPA) in their balance sheets.

At a panel discussion on 'Union Budget-2017', Rangarajan also said that though the adverse impact of demonetisation will wear off as the currency availability improves, some affects will not go away even as sectors like real estate will have to rethink their business models.

"The banking system is undoubtedly under stress. How to resolve that particular problem is only through capitalisation. Please remember even in good old Basil-I, the capital is 8 per cent of the risk weighted assets. So Rs 10,000 crore (capital infusion to banks in 2017-18 as mentioned in the budget) should not be compared with Rs 1 lakh crore or Rs 2 lakh crore," he said.

2:59 pm Earnings: Jubilant Foodworks, which operates Domino's Pizza and Dunkin Donuts chains in India, said profit in October-December quarter declined 31.9 percent year-on-year to Rs 20 crore, with same-store-sales growth at negative 3.3 percent.

Revenue during the quarter increased 3.9 percent to Rs 659 crore compared with Rs 634 crore in year-ago quarter.

Earnings beat analysts' expectations on all counts. Profit was expected at Rs 17.4 crore on revenue of Rs 652.8 crore and operating profit was estimated at Rs 58.5 crore with margin at 9 percent for the quarter, according to average of estimates of analysts polled by CNBC-TV18.

Same-store-sales growth at negative 3.3 percent was much ahead of analysts' estimates of negative 5-6 percent for the quarter, against negative 5 percent in previous quarter and growth of 2 percent in year-ago quarter.

2:39 pm Buzzing: Bharat Forge shares surged more than 4 percent intraday after improvement in US truck orders in January.
 
North America Class 8 truck orders in January increased 20 percent YoY to 21,600 units, according to data available with FTR Transport Intelligence. On month-on-month basis, the growth was only 1.76 percent.

In fact, there has been more improvement in market conditions since November 2016. About 30 percent of Bharat Forge revenue comes from North America Class 8 trucks.
 
CLSA has maintained buy rating on the stock as it sees high likelihood of an upturn by CY18. Imposition of import taxes in US is a risk factor, it feels.

2:25 pm Ujjivan Small Finance Bank operations begin: Ujjivan Small Finance Bank officially started its services with five pilot branches from here, aiming to become a leading mass market retail bank over the next five years by catering to the unserved and under-served customers.

"With a customer base of 35 lakh people, we are now focusing on the under-served. In the last two years, we have done a lot of market research. There is a huge gap in market potential. We want to grow as a major player in retail banking in next five years," said Samit Ghosh, MD and CEO, Ujjivan Small Finance Bank, at the launch.

Ujjivan Financial Services, a non-banking financial company, is the holding company of the small finance bank. It was among the 10 entities to get license from the Reserve Bank late last year to commence small finance banking operations.

2:10 pm Earnings: Drug firm Abbott India reported a 26.21 percent rise in its standalone net profit to Rs 85.56 crore for the quarter ended December 31, 2016 The company had posted a net profit of Rs 67.79 crore in the year-ago period, Abbott India said in a BSE filing.

Its standalone total income from operations also rose to Rs 755.72 crore during the quarter from Rs 669.52 crore in the same period a year ago.

2:00 pm Market Check
Equity benchmarks continued to gain in afternoon trade despite sluggish trade in Europe, with the Nifty hovering around 8800 level. Nifty Bank gained 1 percent on hopes of rate cut in forthcoming RBI monetary policy later this week.

Sanjay Mookim of Bank of America Merrill Lynch expects two rates cuts by the Reserve Bank of India this year, with one coming in the policy meeting on February 8.

"If the intention is to keep real interest rate positive, then there isn't too much room I would believe for central banks to be very aggressive on cuts which is why I think that this is a year where after two years you may get equities outperform bonds where last two years all you had to do was to buy duration," Mookim says.

The 30-share BSE Sensex was up 199.87 points at 28440.39 and the 50-share NSE Nifty rose 54.85 points to 8795.80. About 1796 shares advanced against 1011 declining shares on the BSE.

IIFL Holdings, Fortis Healthcare, Reliance Industries, Wockhardt, Sun TV Network, ICICI Bank, Axis Bank, Aurobindo Pharma and Lupin were most active shares on exchanges.

ICICI Bank gained further, rising 3.5 percent followed by ITC and Sun Pharma with 2-3 percent upside.

Cement majors Ambuja Cements and ACC rallied 4-5 percent after sources told CNBC-TV18 that LafargeHolcim, the parent company of both enterprises, is mulling a merger of the two cement majors. LafargeHolcim owns 63 percent in Ambuja Cements that in turn owns a 50.05 percent stake in ACC.

1:25 pm CCI clearance: Reliance Infrastructure today said its defence unit Reliance Aerostructure Ltd's proposed joint venture with Dassault Aviation has received clearance from the Competition Commission of India (CCI).

"Reliance Infrastructure Ltd-promoted Reliance Aerostructure Ltd's proposed JV with Dassault Aviation has received the CCI clearance," Reliance Infrastructure (RInfra) said in a statement.

The JV company is proposed to be named as 'Dassault Reliance Aerospace Ltd' (DRAL). Reliance Aerostructure Ltd (RAL) will have 51 per cent shareholding in the JV while Dassault Aviation (DA) will hold 49 per cent.

In October last year, Reliance Group had entered into a strategic partnership with Dassault Aviation of France (Rafale) to execute the largest Defence Offset contract worth up to Rs 30,000 crore.

1:00 pm Market Check
The market extended gains in afternoon trade, with the Sensex rising around 250 points on further buying in banking & financials, healthcare and FMCG stocks. The rally was also on hopes of rate cut by Reserve Bank of India on February 8.

The 30-share BSE Sensex gained 242.31 points or 0.86 percent at 28482.83 and the 50-share NSE Nifty rallied 71.35 points or 0.82 percent to 8812.30. The BSE Midcap and Smallcap indices climbed 1 percent each on strong breadth.

The Budget tabled in the Parliament last week, has given foreign institutional investors good signals on what to expect from the Indian economy, says Shilpa Kumar of ICICI Securities. Another aspect that FIIs like about the country, is the settling tension from demonetisation, she adds.

The FIIs eagerly await the monetary policy on February 8, where they expect a rate push to facilitate the economic growth the Budget envisions, says Kumar.

Lupin was biggest gainer among Sensex stocks, up 4 percent followed by Sun Pharma and ICICI Bank with 3 percent upside. ITC, Tata Motors, Asian Paints, Axis Bank and HUL up over a percent while Dr Reddy's Labs remained under pressure, down 1.8 percent.

Gold prices edged up on technical buying and a weaker dollar after mixed US jobs data late last week muted expectations for near-term interest rate hikes.

12:43 pm Tata Sons plan: Tata Sons has started off the process of charting priorities for the group as N Chandrasekaran takes charge as the Chairman on February 21.

Sources tell CNBC-TV18 Tata sons' top priority is to deploy capital mindfully across group companies by March-end.

The company will also work on deleveraging of some of the businesses and is actively charting out a resolution on the telecom (Docomo) and steel (Tata Steel) businesses.

Tata group is keen to resolve the UK pension issue at Tata Steel urgently, sources say, adding, talks with Thyssenkrupp are in the advanced stages and the company is hopeful of a closure soon.

12:25 pm FMCG growth rebound in FY18?: After enduring a tough year due to headwinds such as impact of demonetisation particularly in rural markets, the FMCG industry expects growth to return in 2017-18, said homegrown major Godrej Consumer Products.

"Our expectation is that the fiscal year 2017-18 should see the return of growth in the FMCG sector," Godrej Consumer Products Ltd (GCPL) Managing Director Vivek Gambhir told PTI.

He further said: "We are hopeful that consumer demand will increase gradually, supported by a pro-growth budget with adequate government stimuli and additional investments that lead to more job creation."

12:00 am Market Check
Equity benchmarks retained morning gains, with the Nifty trading above 8800 led by banking & financials, pharma, FMCG and cement stocks. Investors awaited RBI policy due on Wednesday and corporate earnings.

The 30-share BSE Sensex was up 215.23 points at 28455.75 and the 50-share NSE Nifty gained 61.10 points at 8802.05.

The market breadth remained strong as more than two shares advanced for every share falling on the Bombay Stock Exchange.

Ambuja Cements gained 4.6 percent and ACC was up 3.6 percent after sources told CNBC-TV18 that LafargeHolcim, the parent company of both enterprises, is mulling a merger of the two cement majors.

LafargeHolcim owns 63 percent in Ambuja Cements. In November last year, the parent company had increased its stake in ACC and Ambuja Cements by 4 percent and 2 percent respectively. The parent company took a stake in Ambuja Cements, which in turn owns a 50.05 percent stake in ACC.
 
BSE shares saw some profit booking after listing day rally, down 1.27 percent at Rs 1,055.65.

Asian markets were mostly higher on Monday, as investors try to make sense of US President Donald Trump's policy noise. Since Trump's inauguration on January 20, there has been a flurry of actions that run the gamut from immigration to financial deregulation to tighter border control.

Oil prices edged up on fears that new US sanctions against Iran could be extended to affect crude supplies, but markets were capped by further signs of growing US production. Brent crude futures, the international benchmark for oil prices, were trading at USD 57.01 per barrel, up 0.35 percent from their last close.

11:41 am Sale of investment: Empee Distilleries, in a board meeting on February 13, will consider a proposal to sell the investments held in Empee Hotels.

The board of directors will also consider un-audited financial results for the quarter ended December 31, 2016.

11:34 am Demerger: Prakash Industries in its board meeting, on February 14, will consider the agenda of demerger of PVC pipe division of the company.

The board will also consider unaudited financial results with limited review for the quarter / nine months ended December 31, 2016.

11:22 am Buzzing: JSW Steel shares gained nearly 2 percent after reporting highest ever monthly crude steel production in January 2017.

Crude steel production for the month stood 13.85 lakh tonnes against 9.27 lakh tonnes in year-ago month, registering a whopping 49 percent increase, the JSW Group company said in its filing.

Rolled products-Flat steel production increased 38 percent year-on-year to 10.31 lakh tonnes and rolled products-long steel production jumped 18 percent to 2.97 lakh tonnes in the month gone by.

11:10 am SEBI's new chief: Ajay Tyagi, PK Pujari's names are emerged as front runners for SEBI chief post, reports CNBC-TV18 quoting government sources.

Selection committee will shortlist 2-3 names for SEBI chief post soon, sources say.

Current SEBI chief UK Sinha's term will end on March 1.

Currently Ajay Tyagi is additional secretary, Economic Affairs Department while PK Pujari is power secretary.

11:00 am Market Check
Buying interest continued in morning as the Sensex rallied more than 200 points on hopes of RBI cutting repo rate in the forthcoming two-day policy meet that will start on February 7.

The 30-share BSE Sensex gained 216.17 points at 28456.69 and the 50-share NSE Nifty rose 63 points to 8803.95. The market breadth was positive as about three shares advanced for every share falling on the BSE.

Emerging markets (EMs) have started to look better as worries over the new US President Donald Trump resides. Geoff Lewis of Manulife Asset Management is optimistic on EMs and said that there is a good long-term entry point for them now.

Earning prospects are also looking better for EMs now. Some inflows are expected to come in soon for these markets, he feels.

ICICI Bank and Lupin were biggest gainers on Sensex, up 3 percent each followed by ITC, Asian Paints, Tata Motors and SBI while TCS, Dr Reddy's Labs, Infosys and Coal India were under pressure.

10:30 am Business expansion: First it got into your drawing room with tubelights, then washroom with geysers and now it wants to get more personal. The maker of 'wires that don't catch fire' Havells India now plans to start selling personal grooming products like electronic shavers, trimmers and epilators for men and women.

Booming as it is in India, personal grooming products market is a high-involvement category and caters to discerning consumers.

Conscious of this, the company will initially source the products from the same manufacturers that also supply to established global giants – Netherlands-based Philips and US-based Braun that is owned by Procter & Gamble.

Most of such manufacturers are based in China, Hong Kong and Taiwan.

10:00 am Market Check
Equity benchmarks as well as broader markets maintained early gains, with the Sensex rising over 150 points supported by banking & financials ahead of RBI monetary policy later in the week.

The 30-share BSE Sensex was up 180.44 points or 0.64 percent at 28420.96 and the 50-share NSE Nifty rose 52.60 points or 0.60 percent to 8793.55.

Dipen Shah of Kotak Securities says going ahead, the remaining quarterly results will be important to determine the impact of demonetisation.

Focus will now shift to the RBI meeting this week wherein expectations of interest rate cuts have increased, after the Finance Minister set the fiscal deficit target at 3.2%, he feels.

The BSE Midcap and Smallcap indices also gained 0.6 percent each as about three shares advanced for every share falling on the exchange.

ICICI Bank was biggest gainer among Sensex stocks, up 2.5 percent followed by ITC, HDFC, HDFC Bank, SBI, L&T, Axis Bank and Reliance Industries.

Dr Reddy's Labs slipped over 2 percent after consolidated net profit in Q3 fell 15.9 percent to Rs 492.3 crore YoY, though overall earnings beat analysts' expectations. Analysts don't expect margin to sustain going forward.

9:42 am Market Update: Benchmark indices extended rally in morning, with the Nifty reclaiming 8800 level led by banks ahead of RBI policy meeting later in the week.

The 30-share BSE Sensex was up 209.78 points at 28450.30 and the 50-share NSE Nifty rose 61.05 points to 8802.

The market breadth was strong too. About 1468 shares advanced against  412 declining shares on the BSE.

9:35 am CS on Dr Reddy's Labs: Credit Suisse maintained underperform rating on the stock, with unchanged target at Rs 2,750 and slashed FY18 EPS estimate by 3 percent.

It says Q3 was good with 17 percent EBITDA beat driven by better margin & lower SG&A (selling, general and administration).

According to the research firm, margin beat may not sustain but SG&A savings should continue. Court verdict on Aloxi can give maximum 18 months upside, it feels.

9:31 am FII View: Mixo Das of Nomura says he has downgraded tactical stance on Asia ex-Japan equities from 'neutral' to 'cautious'.

MSCI Asia ex-Japan has rarely traded above its current 12.8x forward P/E on a sustained basis in the past six years.

The earnings upgrades that spurred the market re-rating last year have begun to fade, and from here he sees YoY comparables turning unfavourable for the energy and materials sectors in particular.

Perhaps the most prominent risk currently is President Donald Trump, he feels.

"We have argued since election day that Trump's policies are most likely negative for emerging markets and Asia, given their 'America First' approach and, if anything, it looks more and more the case that Trump intends to follow through on his campaign positions," Das says.

9:15 am Market Check
Equity benchmarks started off the week on a strong note, with Nifty inching towards 8800 level and Midcap hitting a record high. Positive Asian cues also boosted sentiment.

The 30-share BSE Sensex was up 161.95 points at 28402.47 and the 50-share NSE Nifty rose 47 points to 8787.95.

Tata Motors, Hero Motocorp, ICICI Bank, Lupin, SBI, Grasim and Tata Motors DVR were early gainers while M&M and ACC were losers.

Dr Reddy's Labs fell 2.5 percent despite better-than-expected earnings. Profit fell 16 percent YoY in Q3.

The Indian rupee has opened marginally higher at 67.20 per dollar against Friday's closing of 67.31 a dollar, registering a gain of 11 paise.

Pramit Brahmbhatt of Veracity says that positive cues from equity market will help the rupee appreciate and it may head towards 67.20 levels.

He expects the trading range for the USD-INR pair between Rs 67.20-67.50/dollar.

The US dollar remained defensive amid uncertainty about the Trump administration's dollar policy. It slipped versus the yen.

Asian markets traded higher today, with Japan's Nikkei, Hong Kong's Hang Seng and China's Shanghai rising 0.2-0.6 percent.