Sensex ends flat, Nifty above 10,350; midcaps correct
29 November 2017
3:30 pm Market at Close: Benchmark indices ended the session on a flat note, with the Nifty closing above 10,350-mark.
The Sensex closed down 15.83 points at 33602.76, while the Nifty was down 9.00 points at 10361.30. The market breadth was negative as 1319 shares advanced against a decline of 1382 shares, while 141 shares were unchanged.
Wipro, Sun Pharma, Bosch and Bharti Infratel were the top gainers, while Axis Bank, Asian Paints, and Zee Entertainment lost the most.
3:28 pm Nomura on Glenmark: Nomura has maintained its buy call on Glenmark Pharma with target price of Rs 880 per share despite seven observations received from USFDA by its Baddi unit.
Form 483 observations for Baddi unit is concerning but observations are not indicating invalidation of high frequency of OOS tests that is a silver lining, the research house said.
According to Nomura, financial impact of observations may be limited. "We don't expect escalation into import alert, and number of products impacted is limited," it said.
3:15 pm Claim for contract cancellation: Parsvnath Developers share price was locked at 5 percent upper circuit at Rs 31.55 as the company will receive claim of Rs 1,034.5 crore alongwith interest.
In arbitral proceedings, Parsvnath and its associate company Parsvnath Rail Land Project Private Limited (PRLPPL) had sought an award of Rs 1,034.54 crore.
The Honourable Arbitral Tribunal has upheld this claim of Rs 1,034.54 crore and directed RLDA to make payment alongwith interest at 4 percent per annum from July 15, 2015 till the date of payment.
In February 2016, Parsvnath Developers had informed exchanges that the development agreement of the company and Parsvnath Rail Land Project with RLDA for implementation of its project at Sarai Rohilla-Kishanganj, New Delhi has been terminated.
That disputes arising under the Development Agreement are pending adjudication before Arbitral Tribunals, where the company and PRLPPL have claimed more than Rs 1,500 crore.
The company and PRLPPL are in consultation with its legal counsel for further course of action, it said.
3:07 pm Buzzing: Shares of Power Mech Projects rose nearly 10 percent on order win worth Rs 357 crore.
The company has received this order under Make in India scheme from Andhra Pradesh Medtech Zone (AMTZ), an enterprise under the Government of Andhra Pradesh.
The order includes construction of ultra modern medical equipment manufacturing and testing facility located at Visakhapatnam, Andhra Pradesh.
Earlier in this week on November 21, the company has received letter of award, letter of intent/work orders worth Rs 381 crore.
3:05 pm Merger: IndusInd Bank and Bharat Financial merger may get approval from the Reserve Bank of India by December-end, reports CNBC-TV18 quoting Cogencis.
Anti-trust body may approve the merger by January.
Sources expect IndusInd Bank-Bharat Financial merger to complete by September 2018.
2:58 pm Buzzing: Loyal Equipments was locked at 5 percent upper circuit as it has received purchase order from Linde Engineering India Private Limited of worth Rs 2.7 crore.
The order is for supply of complete skid package for keys CO2 project of Keys, California, USA.
2:53 pm Order Win: The consortium of Larsen & Toubro and Samsung C&T Corporation of South Korea has bagged the contract for setting up Bibiyana South 400 MW combined cycle power plant project from Bangladesh Power Development Board.
L&T's scope includes design, detail engineering, supply, installation and commissioning of complete power plant on a turnkey basis.
This is the fourth order bagged by L&T in Bangladesh. The project will be executed by gas based power projects business unit of L&T.
2:43 pm Buzzing: CHD Developers shares rallied 19 percent intraday following launch of residential project in Karnal city of Haryana.
"....launches new project CHD Green Park Residences, part of 200 acre integrated township – CHD City, Karnal. The project spreads over a land parcel of 40 acres approximately," New Delhi-based real estate developer said in its filing.
The price range of CHD Green Park Residences starts from Rs 13.99 lakh only for first 250 units. Benefits of Pradhan Mantri Awas Yojana are also applicable in this project, it added.
CHD Group offers total 726 units in first phase of its launch with 2BHK option of super area 740 square feet.
"Construction of sample floors have already been started which should get ready by December 2017. We are focusing to complete the first phase by 2019," Gaurav Mittal, MD, CHD Developers said.
2:33 pm Earnings: Kakatiya Cement share price rallied 9 percent as profit in Q2 increased more than four-fold to Rs 8.2 crore against Rs 1.8 crore in year-ago, driven by strong operational performance.
Revenue during the quarter grew by 9.5 percent year-on-year to Rs 62.4 crore.
Operating profit shot up multi-fold to Rs 12 crore from Rs 2.4 crore and margin expanded sharply to 19.3 percent from 4.2 percent YoY.
2:22 pm Results outlook: Global research firm CLSA released a note on midcap IT sector. The firm said that the sector declared strong Q2 results.
10 midcap IT firms are up 25 percent year to date and they now trade at 15 times CY18. It prefers L&T Tech and Persistent among midcaps.
Here are the top headlines at 2 pm from Moneycontrol News' Anchal Pathak
2:10 pm Market Update: Equity benchmarks remained lacklustre in afternoon as investors await second quarter GDP data due Thursday. November futures & options contracts expiry due on Thursday also caused volatility in the market.
The 30-share BSE Sensex was up 18.16 points at 33,636.75 and the 50-share NSE Nifty declined 1.40 points to 10,368.90.
The market breadth remained positive. About 1,364 shares advanced against 1,161 declining shares on the BSE.
2:06 pm Class Action Lawsuit: Drug firm Dr Reddy's Laboratories today said it has been served a securities class action lawsuit in the US for alleged violations of federal securities laws.
The lawsuit filed at the District Court for New Jersey seeks damages to compensate the class of investors for a 'purported decline' in the company's share price allegedly caused by the misstatements or omissions.
"US Securities class action lawsuit has been served on the company in the US by the lead plaintiff," Dr Reddy's Laboratories said in a filing to BSE.
As intimated earlier, the company believes that the asserted claims are without merit and intends to vigorously defend itself against the allegation, it added.
1:55 pm Economic Growth: A recovery in private capital spending is likely next year as balance sheet fundamentals of corporates are improving amid strengthening financial system, says a report.
Accordingly, the country's GDP growth will accelerate to 7.5 per cent in 2019 financial year, the report by global financial services major Morgan Stanley said.
The report highlighted that 2018 is expected to be the first year of full-fledged recovery for India as it will be marked by a synchronous recovery in domestic as well as external demand and, a pickup in private capex for the first time in six years.
As per Morgan Stanley's discussions with investors, after six years of continued deterioration in private capital spending, investors are "more skeptical" of a turnaround in private capex, but the global brokerage sees three factors which will help to revive private corporate capex.
1:40 pm Code Sharing: Chairman of Jet Airways Naresh Goyal and Air France-KLM chief JM Janaillac made a formal announcement on the code sharing partnership in India.
Jet has joined hands with KLM to boost its long-haul operations. According to the agreement, the joint venture involves both the airlines sharing passenger traffic revenue on the India-Amsterdam and India-Paris route. But, there will be no sharing of cargo revenue.
During the press conference, Goyal said that this programme between Jet Airways, KLM, Air France and Delta will improve cost structure.
"Deal between Jet Airways, AirFrance, KLM & Delta will lead to better linking of 3 continents," said Janaillac.
Benefitting from this agreement, Jet will pose a challenge to Gulf carriers and it will also help in increasing its market share in India's international market.
1:30 pm Drug approval: Cadila Healthcare today said group firm Zydus Cadila has received final approval from the US health regulator to market Candesartan Cilexetil and Hydrochlorothiazide tablets formulations used in treating high blood pressure.
The approval by the US Food and Drug Administration (USFDA) is for multiple Candesartan Cilexetil and hydrochlorothiazide tablets of 16 mg/12.5 mg, 32 mg/12.5 mg and 32 mg/25 mg, Cadila Healthcare said in a BSE filing.
The drug is used to treat high blood pressure. Lowering blood pressure helps prevent strokes, heart attacks and kidney problems, it added. "It will be manufactured at the group's formulations manufacturing facility at Moraiya, Ahmedabad," the filing said.
1:15 pm Acquisitions: State-run power giant NTPC has floated a tender to acquire commissioned stressed coal-based power plants in the country.
At present, out of the 40 GW stressed coal-based power generation capacity, about 12 GW capacity worth around Rs 50,000 crore commissioned after April 1, 2014 and is eligible under this tender.
According to the tender document, the company will shortlist the suitable operational domestic coal-based power assets located in India for possible acquisition after evaluating the offered projects.
1:00 pm Management Speak: Amitabh Chaudhry, MD & CEO, HDFC Life said it has been a very pleasant journey for them since the day of listing. He said investors seemed to have liked their story but more so because of the power of HDFC brand that represents quality of business and consistent in performance and they expect that out of HDFC Life. So going forward, they hope to meet the very high expectation, he said.
The growth rate for the insurance industry in October was around 28 percent and the question is this kind of growth rate sustainable. Chaudhry said in fact October growth was less compared to the year to date growth of 36 percent.
However, two things have transpired since demonetisation and with financialisation of savings, the insurance industry like the mutual fund industry has got higher inflows, which gets reflected in sales numbers, he said in an interview to CNBC-TV18.
12:45 pm Buzzing: Siemens shares fell more than 2 percent intraday after Deutsche Bank has retained its sell rating on the stock and slashed target price to Rs 1,030 (from Rs 1,100 per share) as valuations remain elevated at 42x PE for March 2019.
FY17 orders are strong, but outlook is still concerning, the research house said, adding the opportunity size remains stagnant for FY18 over FY17.
Deutsche also cut order inflow assumption by 3/7 percent for FY18/19 and reduced revenue growth estimate by 4.5/3.8 percent for FY18/19.
Brokerage house Edelweiss, too, trimmed FY18/19 EPS 3 percent each factoring in muted Q4, while maintaining hold rating on the stock with reduced target price at Rs 1,400 (from Rs 1,450 earlier).
12:36 pm Rate cut likely?: The Reserve Bank of India is likely to leave interest rates unchanged at its December policy meeting and through the end of next year, despite expectations that inflation will breach its 4 percent target in the next few months, a Reuters poll showed.
The results, from a poll of economists taken over the past week, also found there is a bigger risk the next move is a cut, even though forecasts diverge in three directions starting from the second quarter of next year.
That suggests both that policymakers have little room for manoeuvre and the outlook for rates beyond the next few months is exceptionally fuzzy, with several respondents saying they were unwilling to look much beyond the turn of the year.
"In the RBI's perception, inflation is inching up and the risks of that remaining high remain for a longer duration, say a couple of quarters or so, it may be difficult for the RBI to consider a rate cut around that scenario," said Shubhada Rao, chief economist at Yes Bank in Mumbai.
12:26 pm Management Interview: VIP Industries has been buzzing in trade, up almost 30 percent this month.
In an interview with CNBC-TV18, Dilip G Piramal, Chairman said if goods and services tax (GST) comes down to 18 percent from 28 percent, prices will automatically get reduced and will be passed on to the consumers, he said.
We will benefit from this, he added.
Speaking on canteen store department (CSD), he said. ''It is not that the segment has become or anything but CSDs has had a shift in their policy and they want to concentrate on the major day-to-day items like the fast moving consumer goods (FMCG) etc.''
Whatever sales we have lost in CSDs, we have made it up in the ordinary trade market, said Piramal.
12:15 pm Earnings Reaction: Shares of infrastructure firm IL&FS Engineering and Construction today surged 5 percent to hit its upper circuit limit on bourses after the company reported robust September quarter results.
The net profit of the company surged to Rs 40.14 crore in the September quarter against a net loss of Rs 81.59 crore in the same quarter of last year.
The company's income from operations however declined to Rs 340.84 crore in the quarter ending September, from Rs 356.87 crore in the September quarter 2016, the company said in a regulatory filing.
12:05 pm Buzzing: ICICIdirect has initiated coverage with a buy rating on Varun Beverages, citing likely huge growth potential on account of low per capita soft drink consumption and increasing penetration through territory acquisition. The stock gained 6.6 percent.
It has set a price target for the stock at Rs 590. Varun is a strong proxy play for soft drink industry in India, it feels.
The research house sees comfort of earnings visibility and improvement in return ratios.
Due to consolidation of newly acquired territories, new product launches and higher growth potential in operating regions, ICICIdirect expects Varun to report revenue CAGR of 12.4 percent in CY16-19 with EBITDA margin of 21.6 percent in CY19.
11:50 am Management Interview: The Whirlpool Corporation stock has had a decent 2017 so far with a nearly 70 percent gain. The management recently met analysts where they indicated that they plan to double revenue by 2020 and remain open to acquisitions.
In an interview with CNBC-TV18, Kapil Agarwal, Vice President-Marketing said, ''The idea is that we believe that India is an important market and we are under-pitched here in this market.''
It is time to expand. We already have our manufacturing and we are planning to invest in manufacturing within our own plants to increase capacity and also innovations, he added.
According to him, next couple of quarters are going to be slightly tougher compared to the last two quarters. ''We are seeing a commodity increase and that would put pressure on our margins and also on pricing,'' said Agarwal.
We are looking at a strong double digit for FY18 and we continue to focus on growing double digit quarter-on-quarter and year-on-year basis, he further mentioned.
11:31 am Buzzing: Real estate stocks like Sobha, Prestige Estates, Brigade etc rallied 5-9 percent as PWC says no new tax on unsold inventory proposed by Income Tax authorities.
11:20 am Rural Growth for Britannia: Global brokerage house Jefferies has initiated coverage with a hold rating on Britannia Industries and expects the stock to hit a target price of Rs 4,850 per share.
The research house likes the food company for its strong execution in biscuits via distribution expansion and cost efficiencies. Strong execution in biscuits bodes well for revenue & margin, it said.
Jefferies expects pick-up in rural growth given the distribution efforts in rural India.
Recently, CEO Varun Berry also told CNBC-TV18 that the company has been seeing double digit growth as far as rural is concerned for a very long time.
Hopefully overall rural demand should come up in the coming six months, he had said.
11:05 am Buzzing: Shares of Cadila Healthcare added 1.3 percent intraday as it has received USFDA approval for Candesartan Cilexetil and hydrochlorothiazide tablets.
Zydus Cadila has received the final approval from the USFDA to market Candesartan Cilexetil and hydrochlorothiazide tablets USP in the strengths of 16mg/12.5 mg, 32mg/12.5mg and 32 mg/ 25 mg.
The drug combines an angiotensin II receptor (type AT1) antagonist and a diuretic, hydrochlorothiazide and is used to treat high blood pressure.
The drug will be manufactured at the group's formulations manufacturing facility at Moraiya, Ahmadabad.
10:51 am Fundraising: India's largest realty firm DLF has called a board meeting on December 1 to approve its proposals to issue equity shares to institutional investors and warrants or debentures to promoters.
DLF is required to launch QIP (qualified institutional placement) and also issue of warrants or debentures because of proposed infusion of about Rs 10,500 crore by promoters into the company.
Infusion of capital by promoters would lead to increase in promoters stake in DLF to more than 75 percent. So, the company will have to launch a QIP to maintain the minimum public shareholding limit of 25 percent.
10:45 am Buzzing Stock: Shares of Larsen and Toubro (L&T) gained nearly 1 percent intraday Wednesday on the back of outperform rating by Macquarie.
The foreign broking house kept outperform rating on the stock with a target of Rs 1590 per share.
According to the firm the valuations are going to catch up as triggers are in place.
The firm believes that the closure of big ticket orders in Q3/Q4 is a catalyst.
10:30 am Oil prices: Oil prices fell on doubts OPEC and Russia will agree an extended crude production cut that the market has priced in, and after a report of an unexpected rise in U.S. fuel inventories.
US West Texas Intermediate (WTI) crude futures were at USD 57.69 a barrel, 0.52 percent below their last settlement.
Traders said WTI was pulled down by a report from the American Petroleum Institute (API) late on Tuesday which showed US crude inventories rose by 1.8 million barrels in the week to Nov. 24 to 457.3 million barrels.
10:10 am Market Check: Equity benchmarks continued to consolidate in morning ahead of expiry of November derivative contracts on Thursday.
The 30-share BSE Sensex was up 10.87 points at 33,629.46 and the 50-share NSE Nifty fell 0.10 points to 10,370.20.
About 1,276 shares advanced against 793 declining shares on the BSE.
10:04 am Management Interview: NCC expects things to normalise from next quarter and expects earnings to improve due to fastrack orders.
"EBITDA growth is likely to continue in second half of FY18 and we are targetting EBITDA margin over 9 percent for FY18," YD Murthy, Executive VP-Finance, NCC said in an interview to CNBC-TV18.
He expects EBITDA to grow faster than revenue growth. With order execution has been increasing, working capital requirement may go up, he feels.
"We are looking at further reduction of finance cost and for that, we are talking to banks to restructure working capital loan," Murthy said.
9:50 am Rupee Trade: The rupee is trading flat after seeing depreciation of 10 paise to 64.51 against the US dollar in opening at the interbank foreign exchange due to appreciation of the American currency overseas.
Yesterday, the rupee had gained further ground against the US currency and finished at a new two-month high of 64.41, appreciating by 9 paise after sustained dollar unwinding by exporters and corporates.
9:40 am Alkem Labs in focus: Alkem Laboratories share price rallied as much as 8.5 percent in morning after Motilal Oswal has upgraded its rating to buy from neutral on the stock, citing likely strong domestic business growth.
The research house has hiked its price target on the stock to Rs 2,500 per share (from Rs 1,950) as it expects domestic business to grow at 20 percent over the next three quarters.
"We expect strong growth over the next three quarters, given a low base of second half of FY17 (impacted by demonetisation) and Q1FY18 (impacted by GST) and likely recovery of 8-10 days of sales in Q3FY18 due to channel restocking post GST," Motilal Oswal said.
The domestic business EBITDA margin has historically been more than 21 percent.
9:31 am Buzzing: Share price of Genus Power Infrastructures gained further on the back of order win from EESL.
The company has won an order from EESL for supply of 13.5 lakh smart meters for the states of Haryana and Uttar Pradesh.
This tender was opened in October by EESL for the supply of 50 lakh smart meters where company emerged as L2 bidder.
Post this order, the total order book of the company stand at Rs 1226 crore.
The company is expecting the supply to commence from Q1FY19.
9:25 am Order Win: Shares of Technofab Engineering has locked at 20 percent upper circuit on the back of order won worth Rs 281 crore.
The company has received new order in the domestic water sector valued at Rs 281 crore
The project is funded by Asian Development Bank.
This order gives a further impetus to the company's standing in the water sector, soon after securing orders in Bhutan and Uganda, and recently completed projects in Tanzania and Zimbabwe, company said in press release.
9:20 am Stake Sale: Reliance Communications said it will sell its DTH arm Reliance BIG TV to Pantel Technologies and Veecon Media & Television, a move aimed at reducing debt.
The company has entered into a binding share purchase agreement with Pantel Technologies Ltd and Veecon Media & Television Ltd for sale of its subsidiary Reliance BIG TV Limited (RBTV), RCom said in a statement without disclosing the deal amount.
"The transaction will help reduce the liability of unsecured creditors, benefiting all stakeholders, including lenders and shareholders of RCOM. The transaction is in consonance with RCOM's stated objective to focus on B2B businesses of the new RCOM," RCom said.
The buyers will acquire the entire shareholding of RBTV with business on an "as-is, where-is" basis, it added.
9:15 am Market Check: Equity benchmarks were mildly higher in opening trade, shrugging off North Korea's latest missile launch, and tracking positive Wall Street close.
The 30-share BSE Sensex was up 34.86 points at 33,653.45 and the 50-share NSE Nifty rose 16.90 points to 10,387.20.
About 896 shares advanced against 317 declining shares on the BSE.
Cipla, Coal India, NTPC, ONGC, Hindalco Industries and L&T were early gainers while Axis Bank and Tech Mahindra were under pressure.
Alkem Labs gained 4 percent on US FDA nod for Capecitabine tablets.
Bhansali Engineering, INEOS Styrolution, Shankara Buildcon, ADF Foods, RPP Infra, Balaji Telefilms, SpiceJet, Jet Airways, Godrej Consumer, United Breweries up 1-6 percent. TechnoFab Engineering rallied 20 percent.
Wall Street stocks surged to fresh records on Tuesday after a key Senate committee advanced the Republican tax cut plan, moving the long-awaited measure closer to the finish line.
All three major US indices set new records by the closing bell, with the Dow Jones Industrial Average up 1.1 percent to 23,839.26.