Nifty closes lower on expiry day; PSU Bank index falls 5%

3:30 pm Market Closing: Benchmark indices closed lower on expiry day Thursday, with the Sensex falling more than 100 points.

PSU Bank was the biggest loser among sectoral indices, falling more than 5 percent.

3:25 pm Budget Expectations: The forthcoming Union Budget on February 01, 2018 will be the first post-GST and last full year budget of the current government before general elections likely to be held in May 2019 and expectations are therefore running high of what the budget can or should deliver.

HDFC Securities said the government however has limited financial leeway to propose any large scale populist spends.

The FM has the unpopular task of balancing economic with politics, and this time, the economics-prolonged rural distress and a delayed
recovery in economic growth-is shaping the politics, it added.

According to the research firm, fiscal deficit for FY19 could be projected at 3.2 percent (thus being on the path to fiscal responsibility, though with some lag).It means that the plan to meet the 3 percent deficit target will be postponed by one year (to FY20) for the third time.

3:20 pm Market Update: Benchmark indices recouped some losses in late trade, with the Sensex falling 65.30 points to 36,096.34 and the Nifty down 11.80 points at 11,074.20.

About three shares declined for every two shares rising on the BSE.

3:12 pm Earnings: VIP Industries today reported a 68.48 percent rise in its consolidated net profit at Rs 26.89 crore for the quarter ended December 2017.

The company had posted a net profit of Rs 15.96 crore during the same period of the previous fiscal, VIP Industries said in a regulatory filing.

Total income during the quarter under review stood at Rs 339.92 crore. It was Rs 311.94 crore in the corresponding quarter of the previous fiscal.

The board of directors approved an interim dividend of Re 1 per equity share of Rs 2 each for the financial year 2017- 18.

3:03 pm Results Reaction: Macquarie has maintained its Outperform rating on Larsen & Toubro Infotech with increased target price at Rs 1,600 (from Rs 1,200 earlier), citing strong revenue growth momentum with all around delivery. The stock gained 5.8 percent intraday Thursday post earnings.

The research house expects deal pipeline and go-to market strategy to keep revenue momentum strong.

It further expects company to post 12-15 percent (YoY) growth in USD revenues over FY18-20, faster than industry.

L&T Infotech is its top pick in the midcap IT space, the research house said.

On Wednesday, Larsen & Toubro Infotech reported a sequential growth of 3.6 percent in net profit for the December quarter helped by large deal wins and a growing digital revenue share.

2:53 pm Buzzing: IIFL has initiated coverage with Buy rating on Himadri Speciality Chemical and target price of Rs 240, implying potential upside of 32 percent as it expects the stock to continue to command premium valuations.

The stock price rallied more than 4 percent intraday Thursday.

The company has strong competitive position in base business and high-margin new products are key growth drivers for the company, the research house said.

IIFL expects new products to add Rs 500 crore to EBITDA by FY23.

Integrated manufacturing and R&D capabilities are key strengths of the company while positives are strong earnings growth, high return ratios and margins, the brokerage house said.

2:45 pm Fundraising: Non-banking finance company Capital First has raised Rs 500 crore through issuance of non-convertible debentures (NCDs) on private placement basis.

"The debenture committee at its meeting today has approved an issue of rated, listed, secured, redeemable, non- convertible debentures of Rs 500 crore on private placement basis," Capital First said in a BSE filing.

The NCDs have a tenure of two years and will carry an interest rate of 8.45 per cent, payable annually.

For the quarter ended December 31, 2017, Capital First reported a 42 per cent jump in net profit at Rs 87 crore, against Rs 61.4 crore in the same period of the previous year.

2:30 pm Results: Plastics products maker Nilkamal said profit grew by 17.1 percent year-on-year to Rs 33.1 crore and revenue increased 5.5 percent to Rs 523 crore in Q3.

Operating profit during the quarter jumped 34.6 percent to Rs 66.2 crore and margin expanded 270 basis points to 12.6 percent compared to year-ago.

2:20 pm Earnings: Crop protection products supplier UPL has reported healthy 25.3 percent growth year-on-year in consolidated profit at Rs 579 crore for quarter ended December 2017 despite weak operational performance.

The bottomline growth was driven by tax credit, lower finance cost and higher revenue.

Consolidated revenue from operations grew by 7 percent to Rs 4,194 crore during December quarter compared to Rs 3,919 crore in year-ago.

EBITDA (earnings before interest, tax, depreciation and amortisation) fell 1.4 percent year-on-year to Rs 716 crore and margin contracted 140 basis points to 17.1 percent for quarter ended December 2017.

2:10 pm Market Check: Benchmark indices turned volatile in afternoon ahead of expiry of January derivative contracts.

The 50-share NSE Nifty widened range from 40 points to 100 points, falling 37.30 points to 11,048.70 while the 30-share BSE Sensex fell 134.49 points to 36,027.15.

About three shares declined for every two shares rising on the BSE.

2:05 pm Fundraising: Torrent Pharmaceuticals said the board of directors has given approval to increase in authorised share capital of the company from Rs 125 crore to Rs 150 crore; for enhancement of borrowing limits from Rs 10,000 crore to Rs 15,000 crore; for creation of charge on company's properties / assets; issuance of unsecured / secured redeemable non-convertible debentures / bonds by way of private placement for an amount not exceeding Rs 12,500 crore; and issuance of equity shares including convertible bonds / debentures through qualified institutional placement (QIP) and / or depository receipts or any other modes for an amount not exceeding Rs 5,000 crore.

2:00 pm Listing: Newgen Software Technologies is set to make its debut on exchanges on January 29 after good response to the initial public offer. The company has fixed issue price at higher end of price band of Rs 245 per share.

The initial public offer (IPO) of the IT firm was oversubscribed 8.25 times during January 16-18, 2018.

The Rs 425-crore IPO had received bids for more than 10 crore shares against the total issue size of 1.22 crore shares, as per data available on the NSE website.

The category reserved for qualified institutional buyers (QIBs) was subscribed 15.62 times, non institutional investors 5.52 times and retail investors 5.18 times.

1:50 pm Earnings: Action Construction Equipment's Q3 profit jumped more than 3 times to Rs 16.4 crore compared to Rs 4.9 crore in year-ago.

Revenue from operations increased 48.6 percent year-on-year to Rs 279 crore from Rs 187.8 crore and operating profit jumped to Rs 27.1 crore from Rs 11.2 crore.

The stock rallied more than 4 percent.

1:45 pm Europe Trade: Major European bourses begun trade relatively mixed, as investors geared up for the latest monetary policy decision from the European Central Bank.

The pan-European STOXX 600 opened down 0.17 percent, while major sectors moved into negative territory. On the bourses front, major indexes were trading mixed.

1:37 pm Market Check: Sensex is down over 200 points, while the Nifty is testing 11,000 now. The Sensex is down 242.75 points or 0.67% at 35918.89, and the Nifty down 69.20 points or 0.62% at 11016.80. About 1013 shares have advanced, 1609 shares declined, and 249 shares are unchanged.

Coal India, Vedanta and L&T gained the most on both indices, while SBI and DRL lost the most.

1:25 pm MF News: LIC Mutual Fund has introduced 'Daily SIP' under five of its schemes with immediate effect, a press release from the fund house stated.

Under the daily SIP option, unit holders can invest as low as Rs 300 per day and this facility will be available in LIC MF Equity Fund, LIC MF Growth Fund, LIC MF Midcap Fund, LIC MF Infrastructure Fund & LIC MF Index Fund and two hybrid schemes--LIC MF Balanced Fund & LIC MF Monthly Income Plan.

The industry has garnered over Rs 62,000 crore annually through SIP route.The fund house which clocks a SIP inflow of around Rs 23 crore every month expects the number to go up to Rs 30 crore following the rise in daily inflow.

1:02 pm Market Check: Bears have dominated the Street through the morning. The Sensex continues to trade over 100 points lower, while the Nifty is trading one-third of a percent lower. Except infra and metals, all major sectoral indices are weak.

The Nifty PSU bank index has taken the biggest hit among them, falling over 4 percent, led by a fall in State Bank of India. The stock is down 4 percent as well.

Among stocks, Dr Reddy's has fallen around 3 percent after its profits fell 29 percent for the December quarter. Having said that, there are about 100 stocks that clocked fresh 52-week highs. Escorts, Havells and ONGC are a part of that list.

12:45 pm Result analysis: Investors turned wary of Mahindra and Mahindra Financial Services post its December quarter performance.

The NBFC reported a net profit of Rs 365 crore on consolidated basis during the quarter ended December as against Rs 12 crore in the corresponding quarter of the last year.

On standalone basis, it reported a net profit of Rs 342 crore as against a loss of Rs 16 crore in the year-ago quarter.

12:21 pm Power Purchase Agreement: KP Energy has informed exchange that KP Energy - Evergreen Consortium has signed power purchase agreement (PPA) for 30MW wind power project with Gujarat Urja Vikas Nigam Limited (GUVNL) through special purpose vehicle (SPV) - Evergreen Mahuva Windfarms Private Limited.

12:05 pm Results: Pharma major Dr Reddy's Laboratories said profit for December quarter fell sharply by 29 percent year-on-year to Rs 334.4 crore due to continued decline in North America business, but North America business improved on sequential basis.

Revenue from operations grew by 3 percent year-on-year to Rs 3,806 crore for quarter ended December 2017.

11:55 am Earnings Estimates: L&T Finance Holdings, the subsidiary of engineering major Larsen & Toubro, is expected to report strong earnings for December quarter led by healthy topline & lower credit cost.

Profit during the quarter is seen rising 35.5 percent to Rs 375.3 crore and net interest income may grow 21.3 percent to Rs 1,132.4 crore compared to year-ago, according to average of estimates of analysts polled by CNBC-TV18.

11:48 am Poll: Non-banking finance company Shriram City Union Finance is expected to report healthy growth in December quarter as profit is seen rising 38.4 percent year-on-year to Rs 218.3 crore.

Net interest income during the quarter is likely to increase 18.7 percent to Rs 904.7 crore compared to Rs 762.4 crore in year-ago, according to average of estimates of analysts polled by CNBC-TV18.

11:41 am Buzzing: Shares of NCC gained 5 percent intraday on the back of approval of fund raising via qualified institutional placement (QIP).

The QIP Committee of the board of directors of the company has approved the floor price for the QIP, at Rs 129.47 per share, determined in accordance with the pricing formula provided under Regulation 85(l) of the ICDR Regulations.

The committee may offer a discount of not more than 5 percent or such other percentage as may be permitted under the applicable law on the QIP floor price.

The relevant date for the purpose of the QIP is January 24, 2018.

11:30 am Market Outlook: Terming the bull run a 'unique one', Gautam Shah of JM Financial said the Street's rally has no parallels and will continue to surprise investors.

Domestic liquidity, extent of correction, lesser volatility and political stability, among others, are seen as some of the reasons for the bull run.

Sounding optimistic on the market, Shah told CNBC-TV18, ''We are far away from major market top. This rally will continue on a gradual basis. There could be a rational correction across sectors and that will be a new norm.''

While investors may show lukewarm response to fresh highs, in the mid-term, he remains positive on the market. Shah sees 10-12 percent upside for the Street in 2018.

So, what could be the risk figures for this market? Shah sees 10,800 as a base here and all declines should be bought into.

11:19 am Earnings Estimates: Country's largest car maker Maruti Suzuki is expected to report strong performance for quarter ended December 2017, driven by double digit volume and better response to new launches.

Profit is seen rising 16.5 percent year-on-year to Rs 2,033 crore and revenue may grow 13 percent to Rs 19,065 crore for October-December 2017, according to average of estimates of analysts polled by CNBC-TV18.

EBITDA (earnings before interest, tax, depreciation and amortisation) during the quarter is expected to increase 21 percent to Rs 3,012 crore and margin may expand 80 basis points to 15.5 percent compared to year-ago due to strong revenue growth and operating leverage.

Maruti could see some margin pressure QoQ due to higher discounts and higher raw material cost in the quarter.

11:09 am Market Update: Equity benchmarks were mildly lower in morning after Brent crude oil futures hit USD 71 a barrel and ahead of expiry of January derivative contracts.

The 30-share BSE Sensex was down 82.98 points at 36,078.66 and the 50-share NSE Nifty fell 18.40 points to 11,067.60 despite positive market breadth.

About 1,252 shares advanced against 1,107 declining shares on the BSE.

11:02 am Buzzing: Shares of Bharat Electronics gained nearly 3 percent as board will consider buyback of equity shares.

A meeting of the board of directors of the company is scheduled to be held on January 30, to consider and approve, unaudited standalone financial results for the quarter and nine months ended December 31, 2017.

The board will also consider declaration of interim dividend for the financial year 2017-18.

At the said board meeting, the proposal for buyback of the fully paid-up equity shares of the company of face value of Re 1 each will also be considered by the board.

10:58 am Crude Oil Prices at MCX: Crude oil futures traded higher by 1.76 per cent at Rs 4,209 per barrel in futures market today as speculators built up positions after positive cues from global market.

At the Multi Commodity Exchange, crude oil for delivery in February spurted by Rs 73, or 1.76 per cent, to Rs 4,209 per barrel, in a business turnover of 3,120 lots.

The oil for delivery in March was trading higher by Rs 70, or 1.69 per cent, to Rs 4,201 per barrel in 114 lots.

Analysts attributed the rise in crude oil prices at futures trade to widening of bets by speculators after it hit highest level since December 2014 in global market, lifted by a weak dollar and a 10th straight week of declines in US crude inventories.

Indian equities coming out of the 'Under-Invested' era with the structural changes in the economy - long way to go. That doesn't mean you can buy any stock at any price, be price sensitive. Explore emerging businesses at rational valuations, they are still in plenty!

10:16 am Buzzing: Shares of Quess Corp, Pidilite Industries and Liberty Shoes rose 2-6 percent in morning on the back of robust Q3 (Oct-Dec) numbers.

Quess Corp has recorded 107 percent rise in its Q3 net profit at Rs 69.8 crore versus Rs 33.7 crore in a year ago period. Revenue was up 48 percent at Rs 1,584 crore versus Rs 1,067 crore. EBITDA increased by 54 percent at Rs 91 crore, while OPM was flat at 5.7 percent. The company's other income doubled to Rs 12 crore.

Pidilite Industries' Q3 net profit was up 18 percent at Rs 239.1 crore versus Rs 202.6 crore. Revenue was up 15.6 percent at Rs 1,542.9 crore versus Rs
1,334 crore. EBITDA was up 29.1 percent at Rs 370.2 crore and EBITDA margin rose 250 bps at 24 percent.

Liberty Shoes has registered 136 percent jump in its Q3 net profit at Rs 2.6 crore and revenue was up 27 percent at Rs 163 crore. EBITDA was flat at Rs 11.4 crore and OPM was down 200 bps at 6.9 percent.

Pidilite Industries, Quess Corp and Liberty Shoes rose 36 percent, 64 percent and 53 percent respectively in the last one year.

10:10 am Crude Oil Update: Oil prices hit their highest since December, 2014, pushed up after US crude inventories posted a 10th straight week of declines and as the dollar continued to weaken.

Brent crude futures, the international benchmark for oil prices, were trading at USD 70.99 a barrel, their highest level since early December, 2014, up 0.67 percent from previous settlement.

USWest Texas Intermediate (WTI) crude futures climbed to USD 66.29 per barrel, also the highest level since early December, 2014, up 1.04 percent from previous close.

10:00 am Market Check: Benchmark indices continue to be rangebound in morning, with the Nifty trading in a range of 11,050-11,100 levels ahead of expiry of January futures & options contracts.

The 30-share BSE Sensex was down 27.75 points at 36,133.89 and the 50-share NSE Nifty fell 3.10 points to 11,082.90.

Nifty Midcap index gained 0.4 percent. About 1,140 shares advanced against 942 declining shares on the BSE.

9:52 am Rupee Trade: The rupee gained 19 paise to 63.49 against the US dollar in morning today on increased selling of the American currency by exporters and banks.

Besides sustained foreign fund inflows, stock markets opening with gains and the dollar weakening against major currencies overseas also supported the domestic unit, forex dealers said.

The dollar was weak following the US Treasury Secretary hailing a 'weak dollar' at the World Economic Forum in Davos.

Yesterday, the rupee had strengthened by 9 paise to close at a new one-week high 63.69.

9:45 am Market Outlook: The year 2017 belongs to high beta stocks which remained in limelight throughout the year but the year 2018 is likely to belong to quality or largecaps stocks, that's the verdict coming from experts.

The valuations of Indian markets look stretch but after a strong rally seen in the small and midcaps, analysts' advise experts to either book profits partially or switch part of their holding to largecaps. A rotation trade already started witnessing just last week.

''For Midcap and small cap stocks it is a sell on rallies as their relative strength has been weakening in favour of large caps. In October-January we did see meaningful outperformance of midcaps over large caps but that changed in the last 10 days,'' Rohit Srivastava, Fund Manager – PMS, Sharekhan told Moneycontrol.

''After 10-Jan-2018, we have seen midcaps fall and large caps rise. This change was quite significant and should be noted in one's asset allocation,'' he said.

9:28 am Plant Expansion: Board of Gallant Ispat approved plan to expand capacity of its various plants at an estimated cost of Rs 510 crore, the company said.

The decision to further expand capacity of various plants was taken at a meeting of the Board of Directors today, Gallant Ispat said in a BSE filing.

As per the plan, the company will expand its captive power plants, steel melting shop, DRI (directly reduced iron) and pellets plant.

"A total of approximately Rs 510 crore of capital expenditure has been projected for the...expansion," the company said in the filing.

9:21 am Future Group Outlook: The Future Group is expecting its retail business to reach Rs 40,000 crore in 2018-19.

"We are looking at retail business of Rs 40,000 crore by next year; out of which Hyderabad will contribute Rs 4,000 crore," Future Group CEO Kishore Biyani told reporters here.

"We will touch Rs 40,000 crore by next year as a Group. Future Group. Currently, this year, we should be Rs 30,000 crore," he said.

Biyani was speaking after launching its 'Golden Harvest' Sona Masoori, a fine rice variety.

Golden Harvest is a Rs 1200 crore brand and has products in categories like staples, spices and dry fruits.

9:15 am Market Check: Equity benchmarks continued to consolidate in opening on Thursday, ahead of expiry of January futures and options contracts.

The 30-share BSE Sensex was down 12.03 points at 36,149.61 and the 50-share NSE Nifty fell 4.30 points to 11,081.70.

The market breadth was balanced as about 683 shares declined against 602 advancing shares on the BSE.

After PSU banks' recapitalisation amount announcement, SBI, PNB and Bank of Baroda were down 1-3 percent. However, IDBI Bank, Bank of India, UCO Bank, Central Bank of India, IOB, Union Bank, OBC, United Bank, Syndicate Bank, Bank of Maharashtra, Dena Bank and Corporation Bank rallied 2-10 percent.

L&T Infotech, Bharat Bijlee, Everest Industries and KEI Industries rallied post earnings. Biocon lost 4.5 percent after bad earnings.