Sensex gains; IndusInd Bank up 5%, metal stocks shine

Essel Group said Invesco Oppenheimer Developing Markets Fund will buy an additional 11 percent stake in Zee Entertainment Enterprises from the company's promoters for Rs 4,224 crore.

Oppenheimer held a 7.74 percent stake in Zee Entertainment as of June 30, 2019.

Royal Enfield maker Eicher Motors has reported a steep 21.6 percent year-on-year fall in June quarter consolidated profit at Rs 451.8 crore, dented by subdued volume performance and weak operating income.

Consolidated revenue during the quarter declined 6 percent year-on-year to Rs 2,381.9 crore as Royal Enfield volumes fell by 19 percent YoY due to weak demand and high ownership cost.

"Nifty50 appears to be making attempts to pull back as it registered a bullish candle before signing off the session. Key positive take away from today's price action can be the fact that after a gap down opening at 11,034 levels the said index not only managed to fill that intraday gap but also registered a strong positive close. This kind of price behavior should instill some confidence among bulls and hence sustaining above 10,999 levels in next session some positive price action can be witnessed," Mazhar Mohammad, Chief Strategist – Technical Research & Trading Advisory, Chartviewindia.in told Moneycontrol.

He said as Nifty is still trading below its 200-day moving average, traders are advised to refrain from creating long positions until this index consolidates around these levels for couple of days and shows some signs of strength on momentum oscillators.

As trend is still favoring bears if this index trades below its psychological support of 11,000 level for atleast 30 mintues then it can come under further selling pressure which shall provide intraday trading opportunity on short side for modest gains of around 50-100 points, he added.

The initial public offer of mobile marketing firm Affle India has received overwhelming response from investors on July 31, the last day for subscription.

The Rs 459-crore public issue has received bids for 29.04 crore equity shares against IPO size of 33.78 lakh shares (excluding anchor investors' book) as per data available on exchanges.

The initial public offer has been oversubscribed 86 times.

"Going forward, we expect that weak domestic sentiments may continue to have a negative bearing on the Indian markets. Further, muted corporate earnings and challenging outlook provided by the corporates is also weighing on the markets. On the global front, Fed meet which will conclude tonight may provide some direction to the markets as there are high expectations for a rate cut," Ajit Mishra Vice President, Research, Religare Broking told Moneycontrol.

He recommended investors should stick to stock specific approach taking cues from the earnings and traders should avoid highly leveraged positions.

Market close: Benchmark indices snapped 2 day's losing streak and ended higher on July 31 with Nifty finished above 11,100 level.

At close, the Sensex was up 83.88 points at 37,481.12, while Nifty was up 28.40 points at 11,113.80. About 1134 shares have advanced, 1333 shares declined, and 137 shares are unchanged. 

Zee Entertainment, Axis Bank, Bharti Airtel, Titan Company and Bharti Infratel were among major losers on the Nifty, while gainers were IndusInd Bank, Yes Bank, IOC, Hero Motocorp and Tata Steel.

All the sectoral indices ended in the green led by the metal, auto, pharma, IT, infra, FMCG and energy.

Oil marketing firm, Indian Oil Corporation (IOC) has posted 41 percent fall in its June quarter net profit at Rs 3,596.11 against Rs 6,099.3 crore in the quarter ended March 2019.

Revenue of the company was up 3.9 percent at Rs 1.50 lakh crore against Rs 1.45 lakh crore.

Shares of Jayshree Tea and Industries declined 3 percent after ICRA revised long term/short term ratings of the company from BBB+/A2 to BBB /A3+ for the enhanced amount of Rs 404 57 crore.

The said rating is due for surveillance any time before June 30, 2020.

The rationale behind this is rise in the cost of production of tea due to increase in wages without any corresponding increase in the prices of teas in India.

Buzzing: Share price of Apollo Tyres rose 3 percent on July 31 after company reported 43.8 percent jump in its Q1FY20 consolidated net profit at Rs 141.6 crore against Rs 251.8 crore in the same quarter last fiscal.

Benchmark indices are trading flat with negative bias but off day's low with Nifty above 11,050 level with the help of buying seen in the major auto and metal stocks.

At 13:50 hrs IST, the Sensex is down 46.44 points at 37,350.80, while Nifty is down 9.40 points at 11,076. About 910 shares have advanced, 1360 shares declined, and 100 shares are unchanged.

The initial public offering of Spandana Sphoorty Financial, the microfinance lender, will open for subscription on August 5

The Rs 1,201-crore IPO comprises a fresh issue of Rs 400 crore, and offer for sale of Rs 801 crore by promoters and investors.

The company has fixed a price band at Rs 853-856 per share for public issue which will close on August 7.

Eicher Motors is expected to report double digit decline in June quarter profit with sharp contraction in EBITDA margin on subdued volume growth, according to brokerages.

"We expect standalone revenues to decline by 5 percent YoY, led by increase in prices as the company has introduced ABS in all its models to comply with the new safety norms. We expect EBITDA margin of Royal Enfield to decline by 660 bps YoY due to negative operating leverage (-270 bps YoY) and decline in gross margin (-390 bps YoY)," said Kotak which expects consolidated adjusted net profit to decline by 15 percent YoY led by weak performance of both Royal Enfield and VECV.

Royal Enfield volumes declined by 19 percent YoY in Q1FY20 due to weak demand and high ownership cost.

Buzzing: Tech Mahindra shares fell nearly 5 percent intraday to hit a 15-month low on July 31, as global brokerages cut price target after weak set of earnings in June quarter.

Share price of Dish TV India fell nearly 4 percent intraday July 31 after the company reported losses in the quarter ended June 2019.

The company's Q1 consolidated net loss was at Rs 32 crore against a profit of Rs 37.9 crore in the Q1FY19.

Dollar Update: The dollar held steady on Wednesday, largely in a wait-and-see mode as traders looked ahead to the outcome of the Federal Reserve’s meeting later in the day when policymakers are expected to cut interest rates for the first time since 2008.

Buzzing: Shares of Coffee Day Enterprises shed another 20 percent to hit 52-week low in the early trade on July 31 after Cafe Coffee Day founder VG Siddhartha body was found near the Netravathi river in Mangaluru.

Crude Update: Oil prices rose for a fifth day on Wednesday, buoyed by a bigger than expected drop in US inventories and as investors awaited a widely expected cut in interest rates by the Federal Reserve, the first in more than 10 years.

Market Opens: It is a weak start for the market on July 31 with Nifty trading below 11,050.

At 09:18 hrs IST, the Sensex is down 208.10 points at 37,189.14, while Nifty is down 65.60 points at 11,019.80.  About 227 shares have advanced, 614 shares declined, and 21 shares are unchanged. 

Axis Bank, Tech Mahindra, Coffee Day Enterprises, JSW Steel, PNB Housing, Eicher Motors, IOC, Gammon Infra, Suzlon, are among major losers on the indices, while gainers are Gujarat Gas, Dish TV and UPL.

All the sectoral indices are trading in the red led by the metal, bank, pharma, IT, energy, FMCG and Infra.

Market at pre-open: Benchmark indices are trading lower in the pre-opening session.

At 09:01 hrs IST, the Sensex is down 16.73 points or 0.04% at 37380.51, and the Nifty down 15.50 points or 0.14% at 11069.90.

Sell Rating, target cut to Rs 2,100 from Rs 2,350 per share

Cut FY20-21 EPS estimate by 4-6%

Remain cautious on India’s 2-wheeler industry given weak demand 

Underweight call, target cut to Rs 2,143 from Rs 2,459 per share

Q1 operating results in-line with our estimates 

Cut EPS estimates by 8% for FY20 & 15% each for FY21 & FY22 

Maintain outperform, target cut to Rs 2,710 from Rs 2,920 per share

Demand uncertain in the near term; valuations remain supportive

Cut volume estimates from +2% to -4% for FY20

Buy rating, target at Rs 3,250 per share

Q1 broadly in-line; management outlook cautiously optimistic

Co continues to dominate the domestic bike segment 

Reduce call, target cut to Rs 2,100 from Rs 2,150 per share

Demand weakness led by rural slowdown to hurt

Co hopes demand to revive during festivals

Maintain outperform, target cut to Rs 730 from Rs 910 per share

Weak quarter for margin; telecom & deal wins steady

Cut our valuation multiple to 14x from 16x

Neutral call, target cut to Rs 705 from Rs 780 per share

Weak quarter with communication & enterprise revenues declining, QoQ

Deal wins decent at $475 m 

Buy rating, target cut to Rs 760 from Rs 820 per share

Several deal starts, especially in communications, slipped into Q2

Management largely retained its FY20 revenue outlook 

Maintain outperform, call, target cut to Rs 740 from Rs 800 per share

Cut revenue estimates by 1-3% & margin by 170-230 for FY20-22

Cut EPS estimates by 6-10% for FY20-22 

Overweight call, target cut to Rs 765 from Rs 850 per share

Q1 revenue in-line but margin is below estimates

Cut FY20, FY21 & FY22 EPS estimates by 5%, 4% & 4%

Maintain hold, target at Rs 34 per share

On adjusted basis, ARPU declined 6% YoY

Believe DTH business will likely remain under pressure from NTO

Stock is potentially attractive from an M&A perspective

Sell rating, target cut to Rs 27 from Rs 36 per share

After the dismal Q4, we are underwhelmed by Q1 numbers as well 

Cuts would have been higher if license fee payments were as per old practice

Maintain buy rating, target cut to Rs 50 from Rs 60 per share

Subscription revenues miss estimates; Essel group deleveraging key

EBITDA ahead of estimates on lower-than-expected employee costs

Neutral call, target cut to Rs 1,990 from Rs 2,640 per share

Stable asset quality; liquidity drags growth

Financial services ROE of 17% was ahead of estimate on lower provisions 

Overweight call, target at Rs 1,100 per share

Core PPoP grew 32% YoY, 9% above estimate

Slippages should be lower in Q2 & beyond

Buy rating, target cut to Rs 885 from Rs 910 per share

Weak asset quality, credit cost trajectory intact

Push core PPoP higher for FY20, but offset by higher credit costs 

Buy Rating, target cut to Rs 900 from Rs 980 per share

Core PPoP strong; asset quality disappoints

Cut PAT by 9%/6% for FY20/21e as we build in higher provision costs

Buy rating, target at Rs 904 per share

Management continues to execute its longer term strategy 

Expect an improvement across verticals 

Maintain buy rating, cut target to Rs 900 from Rs 1,000 per share

Weaker asset quality drives cuts in earnings 

Improvement in asset quality trends are key to a rerating

Buy rating, target raised to Rs 265 from Rs 230 per share

Volume surge + margin spike drives big beat

Reported an extremely strong Q1 with volumes surging 41% QoQ

Maintain buy, target raised to Rs 210 from Rs 195 per share 

Record volumes; earnings to double over FY19-21

Raise our EPS estimate 20-23

Wall Street ends lower: Wall Street lost ground on Tuesday after a warning from President Donald Trump to China amid ongoing trade negotiations pressured technology shares, while investors looked to an expected Federal Reserve interest rate cut at the conclusion of its monetary policy meeting.

Asian markets trade lower: Asian shares weakened in early trade on Wednesday, rattled by fresh trade war concerns following threats from President Donald Trump to Beijing, while increasing worries about a no-deal Brexit kept the pound under pressure.

SGX Nifty: Trends on SGX Nifty indicate a negative opening for the broader indices in India, a fall of 37.50 points or 0.34 percent. Nifty futures were trading around 11,060-level on the Singaporean Exchange.