All You Need To Know Going Into Trade On May 30 

Asian equities were mixed on Thursday after concerns about global growth sent U.S. shares lower overnight.

Shares in South Korea clawed back some of Wednesday's slide, while Japanese and Australian stocks slipped. The Singapore-traded SGX Nifty, an early indicator of NSE Nifty 50 Index's performance in India, rose 0.1 percent to 11,875.50.

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BQ Live

Here's a quick look at all that could influence equities today.

U.S. Market Update

• U.S. stocks fell to a 12-week low, while Treasuries advanced amid persistent concern the bond-market recession warning is growing louder as the trade war shows no signs of easing.
• The yield on 10-year Treasuries held at 2.26 percent.

#BQMarketWrap | U.S. stocks fall to 12-week low; Treasuries gain.

Read: https://t.co/BIncTto54W pic.twitter.com/2lHWbgV0bp

Asian Cues

• Japan's Topix index fell 0.5 percent.
• Australia's S&P/ASX 200 Index dropped 0.4 percent.
• South Korea's Kospi index rose 0.6 percent.
• Futures on the S&P 500 added 0.2 percent.

Commodity Cues

• Brent crude fell 0.35 percent to $67.85 per barrel.
• West Texas Intermediate crude rose 0.5 percent to $59.12 a barrel.
• Gold was steady at $1,279.62 an ounce.

London Metal Exchange

• Copper halted a two-day gain, closing 1.3 percent lower.
• Zinc snapped a two-day rally, ending 0.82 percent lower.
• Nickel ended lower for the second day, down 0.64 percent.
• Lead ended 0.44 percent higher.
• Aluminium halted a three-day gain, closing 0.66 percent lower.

Indian ADRs

Stocks To Watch

• International Paper APPM: Promoter group International Paper entered into an agreement with West Coast Paper Mills to sell its controlling stake in the company. As per the tender offer, West Coast Paper Mills will acquire 51 percent to 60 percent stake in the company. International Paper holds 75 percent stake in the company.
• Tata Power's two arms entered into agreement to sell their entire stake in Nelito Systems worth Rs 15.6 crore to Japan-based DTS Corporation.
• IOL Chemicals and Pharma: Board approved increasing capacity for Ibuprofen from 10,000 MT to 12,000 MT and for Iso Butyl Benzene from 9,000 MT to 12,000 MT, per annum respectively for a capex of Rs 1 crore.
• HDFC: Board approved subsidy worth Rs 22,136 crore to over 1.04 lakh homebuyers under Pradhan Mantri Awas Yojna-CLSS scheme
• Jaypee Infratech clarified on the news of Adani Group offering Rs 500 crore to the lenders stating that no such negotiations took place.
• Nava Bharat Ventures: Board approved buyback of 15.6 lakh shares to Rs 160 per share aggregating to Rs 25 crore. Buyback is at a premium of 50 percent to the current market price.
• Goa Carbon said operations in its Goa unit have resumed with effect from May 25
• AIA Engineering: Bhupesh Porwal resigned from the post of chief financial officer with effect from May 29.
• Cholamandalam Investment and Finance entered into an agreement to raise $222 million debt funds in U.S. dollar bonds International World Bank Group's International Financial Corporation.
• Engineers India: ONGC approved nomination of BN Reddy as the government director in the board of the government.
• Vakrangee appointed Gopal Bihani as CFO with effect from May 29

Nifty Earnings To Watch

• Coal India
• Oil & Natural Gas Corporation

Other Earnings To Watch

• Ujjivan Financial Services
• IDBI Bank
• Berger Paints
• National Aluminium Company
• Entertainment Network
• Ahluwalia Contracts
• Prabhat Dairy
• Pricol
• Infibeam Avenues
• Jindal Poly Films
• Sadbhav Engineering
• Shivalik Rasayan
• Suzlon Energy
• Greenply Industries
• Alkem Laboratories
• Apollo Hospitals Enterprise
• Ashapura Minechem
• Avon Lifesciences
• Munjal Showa
• Uniply Industries
• Unitech
• Bajaj Healthcare
• Bharat Dynamics
• Bharat Gears
• Bharat Rasayan
• Binani Industries
• Cox & Kings
• Deepak Fertilisers & Petrochemicals
• Dredging Corporation of India
• Essar Shipping
• Everest Kanto Cylinder
• Forbes & Company
• GMM Pfaudler
• Godfrey Phillips
• Sundaram Finance
• Greenlam Industries
• Gujarat Apollo Industries
• HCL Infosystems
• Hinduja Global Solutions
• IL&FS Investment Managers
• Jindal Worldwide
• KNR Constructions
• Mahanagar Telephone Nigam
• Mcleod Russel
• Mcnally Bharat Engineering
• Mirza International
• MMTC
• Nath Bio-Genes
• NCL Industries
• NLC India
• Omkar Speciality Chemicals
• Panacea Biotec
• Reliance Infrastructure
• Signet Industries
• Vipul
• Sonata Software
• Steel Authority of India
• Sumeet Industries
• Tide Water Oil Company
• TTK Healthcare
• Williamson Magor & Company
• Vadilal Enterprises
• Manpasand Beverages
• Kwality

Earnings Reaction To Watch

Power Grid Corporation (Q4, YoY)

• Revenue up 18 percent to Rs 9,218.1 crore.
• Net profit up 51.9 percent to Rs 3,054 crore.
• Ebitda up 19.4 percent to Rs 7,793.4 crore.
• Margin at 84.5 percent versus 83.5 percent.
• Deferred tax reversal of Rs 6,013.9 crore.
• Transmission segment revenue up 19 percent to Rs 8983.8 crore.

Adani Power (Q4, YoY)

• Revenue up 68.8 percent to Rs 6,721.7 crore.
• Net profit at Rs 634.64 crore versus net loss of Rs 653.3 crore.
• Ebitda down 50.7 percent to Rs 608.2 crore.
• Margin at 9.1 percent versus 30.9 percent.

Hawkin Cooker (Q4, YoY)

• Revenue up 9 percent to Rs 184.7 crore.
• Net profit up 5.1 percent to Rs 13.5 crore.
• Ebitda up 5.4 percent to Rs 22 crore.
• Margin at 11.9 percent versus 12.3 percent.

Tourism Finance Corporation (Q4, YoY)

• Revenue up 13.4 percent to Rs 63.13 crore.
• Net profit up 61.8 percent to Rs 25.53 crore.
• Ebitda up 17.9 percent to Rs 56.59 crore.
• Margin at 89.6 percent versus 86.2 percent.
• Other income of Rs 5.78 crore.

Nava Bharat Ventures (Q4, YoY)

• Revenue down 12.5 percent to Rs 773.7 crore.
• Net profit down 59.2 percent to Rs 70.8 crore.
• Ebitda down 26.4 percent to Rs 303.46 crore.
• Margin at 39.2 percent versus 46.6 percent.

Mishra Dhatu Nigam (Q4, YoY)

• Revenue up 8.2 percent to Rs 336.4 crore.
• Net profit up 3.6 percent to Rs 80.29 crore.
• Ebitda down 4.1 percent to Rs 110.69 crore.
• Margin at 32.9 percent versus 37.1 percent.

Excel Crop Care (Q4, YoY)

• Revenue up 31.8 percent to Rs 273.22 crore.
• Net profit of Rs 4.73 crore versus net loss of Rs 0.52 crore.
• Ebitda up 2.4 times to Rs 11.77 crore versus Rs 4.86 crore.
• Margin at 4.3 percent versus 2.3 percent.

Ruchi Soya Industries (Q4, YoY)

• Revenue up 20.1 percent to Rs 3,146.33 crore.
• Net profit at Rs 32.1 crore versus net loss of Rs 423.55 crore.
• Ebitda profit of Rs 35.9 crore versus Ebitda loss of Rs 374.34 crore.
• Ebitda includes provision for bad debts of Rs 3.4 crore versus Rs 314 crore

Gujarat Narmada Valley Fertilizer & Chemicals (Q4, YoY)

• Revenue down 18.9 percent to Rs 1430.9 crore.
• Net profit down 71.5 percent to Rs 93.6 crore.
• Ebitda down 77.7 percent to Rs 104.81 crore.
• Margin at 7.3 percent versus 26.6 percent.

Bharat Electronics (Q4, YoY)

• Revenue up 7.3 percent to Rs 3,884.6 crore.
• Net profit up 19.7 percent to Rs 668.6 crore.
• Ebitda up 16.7 percent to Rs 929 crore.
• Margin at 23.9 percent versus 22 percent.

United Spirits (Q4, YoY)

• Revenue up 3.5 percent to Rs 2,250 crore.
• Net profit down 40.2 percent to Rs 126.2 crore.
• Ebitda up 2.9 percent to Rs 283.6 crore.
• Margin at 12.6 percent versus 12.7 percent.
• Other Income of Rs 121 crore in base quarter.

J Kumar Infraprojects (Q4, YoY)

• Revenue up 24.8 percent to Rs 968 crore.
• Net profit up 4.6 percent to Rs 57.3 crore.
• Ebitda up 14.1 percent to Rs 134.1 crore.
• Margin at 13.9 percent versus 15.1 percent.

IOL Chemicals & Pharma (Q4, YoY)

• Revenue up 46.9 percent to Rs 422.3 crore.
• Net profit up 8.8 times to Rs 101.7 crore.
• Ebitda up 4.9 times to Rs 157.1 crore.
• Margin at 37.2 percent versus 11.2 percent.
• Inventory gain of Rs 24.5 crore.

Garden Reach Shipbuilders & Engineers (Q4, YoY)

• Revenue down 22.4 percent to Rs 489.2 crore.
• Net profit down 51.4 percent to Rs 33.6 crore.
• Ebitda down 11.6 percent to Rs 31.2 crore.
• Margin at 6.4 percent versus 5.6 percent.

Rail Vikas Nigam (Q4, YoY)

• Revenue up 29 percent to Rs 3,418.4 crore.
• Net profit up 13.6 percent to Rs 185.8 crore.
• Ebitda up 20.4 percent to Rs 177.4 crore.
• Margin at 5.2 percent versus 5.6 percent.

MIRC Electronics (Q4, YoY)

• Revenue down 17.3 percent to Rs 155.9 crore.
• Net loss at Rs 2.4 crore versus net profit of Rs 4 crore.
• Ebitda down 32.7 percent to Rs 3.7 crore.
• Margin at 2.4 percent versus 2.9 percent.

MSTC (Q4, YoY)

• Revenue down 13.9 percent to Rs 734.4 crore.
• Net loss of Rs 2.4 crore versus net profit of Rs 4 crore.
• Ebitda profit of Rs 3.7 crore versus Ebitda loss of Rs 501 crore.
• Other income of Rs 459.5 crore in base quarter (Provision write-back)

SSJVN (Q4, YoY)

• Revenue up 2.3 times to Rs 805.2 crore.
• Net profit up 3.7 times to Rs 458.9 crore.
• Ebitda up 3 times to Rs 625.1 crore.
• Margin at 77.6 percent versus 59.8 percent.
• Finance cost down 99 percent to Rs 0.5 crore.

NBCC (Q4, YoY)

• Revenue up 7 percent to Rs 3,138 crore.
• Net profit down 8 percent to Rs 137 crore.
• Ebitda down 18.7 percent to Rs 157.8 crore.
• Margin at 5 percent versus 6.6 percent.

GMR Infrastructure (Q4, YoY)

• Revenue down 6 percent to Rs 1,983 crore.
• Net loss of Rs 2,341 crore versus net profit of Rs 5 crore
• Ebitda down 25 percent to Rs 309 crore.
• Margin at 15.6 percent versus 19.6 percent.
• Exceptional loss of Rs 2212 crore booked as impairment loss related to investments in GMR Energy

Bulk Deals

• S Chand & Co: HDFC MF sold 2.26 lakh or 0.65 percent equity shares to Rs 118.49 each

Pledge Share Details

• JSW Energy promoter group Glebe Trading created pledge of 10 lakh shares on May 27.
• Emami promoter groups created pledge of 28 lakh shares and revoked pledge of 1 lakh shares from May 24-28.

Trading Tweaks

• DCM ex-date for demerger.
• IIFL Holdings ex-date for spin-off.
• J.Kumar Infraprojects, Manpasand Beverages, MIRC Electronics , Sundaram Brake Linings to move into short term ASM Framework.
• Indiabulls Venture to move out of short term ASM Framework.
• Adhunik Industries to move into ASM Framework.
• Camlin Life Sciences price band revised to 10 percent.
• 5paisa Capital price band revised to 5 percent.

Who's Meeting Whom

• Tamil Nadu Newsprint and Papers to meet SBI MF and HDFC AMC on May 30.
• Polycab to meet Wellington Management Group on May 30.
• Tata Steel to meet HDFC MF on May 30.
• Kaya to meet Amansa Capital, Tata Investment Corporation on May 30.
• CG Consumer Electricals to meet Enam AMC on June 4.

Insider Trading

• Mindtree: L&T acquired 97,800 shares on May 29.
• Gateway Distriparks promoter Perfect Communications acquired 1.1 lakh shares from May 27-28.
• JK Agri Genetics promoter Bengal & Assam Co acquired 15 lakh shares on May 24.

Money Market Update

The Indian rupee ended lower for the second consecutive trading session against the dollar.

The home currency depreciated 0.22 percent yesterday to close at 69.83 against the greenback. The implied opening from forwards suggest that the local legal tender may start trading at 69.69.

The sovereign bonds are likely to drop today as a rise in crude oil prices on plunging U.S. inventory concerns hurt. The yield on the benchmark 2029 government debt fell two basis points to 7.13 percent.

F&O Cues

Futures

Nifty

• Nifty May futures closed trading at 11862, premium of 1.2 points versus 12 points.
• Nifty futures open interest across series up 5 percent, adds 13 lakh shares.

Bank Nifty

• Bank Nifty May futures closed trading at 31317, premium of 21.7 points versus 31 points.
• Bank Nifty open interest across all series down 3 percent, sheds 67,000 shares.

Rollovers

• Nifty Rollover at 52 percent, Bank Nifty Rollover at 55 percent.

Options

• Nifty PCR at 1.15 versus 1.27 (across all series).

Nifty Monthly Expiry 30 May

• Max open interest on call side at 12,000 (53.4 lakh shares).
• Max open interest on Put side at 11,000 (33.7 lakh shares).
• Max open interest addition seen at 12,000 (+12.9 lakh shares), 11,950C (+9 lakh shares).

Stocks In F&O Ban

• In Ban: Adani Power
• Out Of Ban: PC Jewellers

Brokerage Radar

On Aurobindo Pharma

Citi

• Maintained ‘Buy'; hiked price target to Rs 890 from Rs 840.
• March quarter was in line; Sandoz's U.S. generic acquisition on track.
• Ebitda margin impacted by recalls and failure to supply penalties.
• Management tried to diffuse some concerns regarding the impact of recent OAIs.

HDFC Securities

• Upgraded to ‘Buy' from ‘Neutral'; maintained price target at Rs 800.
• Upgrade owing to attractive valuations after the recent fall in stock price.
• Believe concerns are misplaced as only five to six products are dependent on these plants.
• With high visibility of FY21 earnings per share at Rs 53.2 due to Sandoz acquisition, we see this as good entry point.

CLSA

• Upgraded to ‘Buy' from ‘Outperform'; cut price target to Rs 830 from Rs 850.
• Upgrade to buy on attractive valuations.
• U.S. continues to grow well despite a high base.
• Focus on integration of acquisitions over next two years.

On Cadila Healthcare

Macquarie

• Maintained ‘Outperform'; cut price target to Rs 340 from Rs 372.
• New launches to offset Moraiya hit.
• Cut EPS estimates for the current and the next financial year by 13 percent and 12 percent respectively to factor in OAI for Moraiya.
• Stock is down 25 percent, see this as a buying opportunity.

CLSA

• Maintained ‘Sell' with a price target of Rs 250.
• In-line operationally, net profit beat driven by higher other income.
• U.S. sales declined QoQ and likely to be under pressure in 2019-20.
• Classification of Moraiya plant by U.S. FDA over the next three months will be keenly watched out for.

More Calls

Macquarie on United Spirits

• Maintained ‘Neutral' with a price target of Rs 583.
• March quarter results were below expectations; Overall volume growth at 2 percent.
• Refrain from extrapolating March quarter numbers as pricing and volume to increase.
• United Spirits has levers to cut operating cost in the medium term.

CLSA on Mahindra & Mahindra

• Downgraded to ‘Underperform' from ‘Buy'; cut price target to Rs 690 from Rs 850.
• March quarter was weak but better than estimates.
• Tractor industry demand coming under pressure.
• Sharp fall in legacy SUV volumes eating into the benefit of new launches.

CLSA on Lemon Tree

• Maintained ‘Buy' with a price target of Rs 89.
• Occupancy remains strong, but ADR growth disappoints at 4 percent.
• Pipeline of managed rooms was strong, continuing its focus on a shift to an asset-light model.
• See multiple growth and profitability triggers ahead.

CLSA on Power Grid

• Maintained ‘Outperform' with a price target of Rs 217.
• Net profit growth for the previous financial slows as HVDC project scheduled for the second half is delayed.
• Earnings slowdown ahead as capitalisation peaked.
• Large thermal generation and green corridor capex pick-up critical.

CLSA on Havells India

• Maintained ‘Outperform'; cut price target to Rs 780 from Rs 815.
• Delayed summer season and low government spending drive earnings miss.
• Cables margin steady and lighting revenue growth strong.
• Lloyd's backward integration to drive margin expansion.

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