All You Need To Know Going Into Trade On December 6

Commodity companies led a drop in Asian stocks following a rout in copper prices. The Australia dollar and bond yields tumbled as traders dialed back expectations for higher interest rates after growth missed estimates.

The Singapore-traded SGX Nifty, an early indicator of NSE Nifty 50 Index's performance in India, fell 0.2 percent at 10,125 as of 7:05 a.m.

Short on time? Well, then listen to this podcast for a quick summary of the article!

DayBreak

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

Global Cues

• U.S. stocks fell, with an afternoon swoon wiping out early gains for a second straight day, as investors assessed the impact of proposed tax cuts. The dollar rose and industrial metals dropped.

#BQMarketsNow | U.S. stocks drop as investors assessed the impact of proposed tax cuts.https://t.co/5R7rpPLEi1 pic.twitter.com/wXTifFKhvi

December 6, 2017

Europe Check

• The Stoxx Europe 600 Index closed down 0.2 percent.
• The MSCI Emerging Market Index sank 0.5 percent.

Asian Cues

Australia's third-quarter GDP climbed 2.8 percent from year earlier versus a forecast of 3 percent, reinforcing expectations for the central bank to stand pat on rates for much of next year.

• The Topix index fell 0.3 percent, with mining sub-measures the biggest decliners. The Nikkei 225 Stock Average lost 0.4 percent.
• Australia's S&P/ASX 200 Index declined 0.2 percent. South Korea's Kospi index fell 0.3 percent.
• S&P 500 Index futures rose 0.1 percent. The underlying gauge slipped 0.4 percent.
• Futures on Hong Kong's Hang Seng Index rose 0.3 percent.

Here are some key events scheduled for the remainder of the week:

• The European Commission College of Commissioners discusses Brexit on Wednesday and will likely make its recommendation on whether sufficient progress has been made to move negotiations onto the future relationship.
• The U.S. faces a partial government shutdown after money runs out on Dec. 8 if Congress can't agree on a spending bill by then.
• U.S. employers probably hired at a robust pace in November as the unemployment rate held at an almost 17-year low. The Labor Department's jobs report Friday may also show a bump up in average hourly earnings.

Policy Day Guide: Key Questions For The MPC To Debate

The monetary policy committee will deliver its fifth review of the financial year on Wednesday. A poll by Bloomberg News suggests that most economists expect a status quo policy. Forty-one of 46 economists polled expect the repo rate to remain unchanged at 6 percent, while a small minority expects another 25 basis point cut to 5.75 percent.

Click for more on what to expect from the monetary committee

Commodity Cues

• West Texas Intermediate crude fell 0.3 percent to $57.43 a barrel.
• Gold was at $1,266.09 an ounce, near the lowest since August, after falling 0.8 percent.
• Copper futures were steady after slumping 4.7 percent.
• Sugar ended lower at 14.90 cents per pound; down 1.06 percent.

Shanghai Exchange

• Steel snaps two-day winning streak; down 1.93 percent.
• Aluminium trades lower for second day; down 1.4 percent.
• Zinc trades lower for second day; down 2.05 percent.
• Copper trades near three-month low, down 3.32 percent.
• Rubber trades lower; down 3.08 percent.

Indian ADRs

Earnings To Watch

• Ador Welding
• Arshiya
• Centum Electronics
• Kridhan Infra
• Pokarna

Earnings Reaction To Watch

Dish Tv (Q2, YoY)

• Revenue down 4 percent at Rs 749 crore.
• Net loss of Rs 16 crore from a profit of Rs 70 crore.
• Ebitda down 18 percent at Rs 216.5 crore.
• Margin at 28.9 percent versus 34 percent.

Lux Industries (Q2, YoY)

• Revenue down 15 percent at Rs 226 crore.
• Net profit down 23.5 percent at Rs 13 crore.
• Ebitda down 17 percent at Rs 29 crore.
• Margin at 12.8 percent versus 13.1 percent.

Manali Petrochemicals (Q2, YoY)

• Revenue up 7 percent at Rs 148 crore.
• Net profit down 16 percent at Rs 9.2 crore.
• Ebitda down 26 percent at Rs 14 crore.
• Margin at 9.5 percent versus 13.7 percent.

Windsor Machines (Q2, YoY)

• Revenue up 8 percent at Rs 86 crore.
• Net profit up 30 percent at Rs 7.8 crore.
• Ebitda up 18 percent at Rs 13 crore.
• Margin at 15.1 percent versus 13.8 percent.

Harrisons Malayalam (Q2, YoY)

• Revenue flat at Rs 92.5 crore.
• Net profit up 13 percent at Rs 87 crore.
• Ebitda down 27 percent at Rs 3.3 crore.
• Margin at 3.6 percent versus 4.9 percent.

The Byke Hospitality (Q2, YoY)

• Revenue down 45 percent at Rs 29.4 crore.
• Net profit down 10 percent at Rs 5.2 crore.
• Ebitda down 5 percent at Rs 11.3 crore.
• Margin at 38.4 percent versus 22.2 percent.

Plastiblends (Q2, YoY)

• Revenue up 12 percent at Rs 144 crore.
• Net profit down 62.5 percent at Rs 3 crore.
• Ebitda down 33 percent at Rs 10 crore.
• Margin at 6.9 percent versus 11.6 percent.

Stocks To Watch

• Lanco Infra to sell four renewable energy assets (Mint).
• Aurobindo Pharma gets U.S. FDA nod for Ranolazine Extended Release Oral Tablet.
• RBI allows foreign institutions to further buy shares of Bharat Financial.
• Shilpa Medicare received 10 observations from U.S. FDA for its Telangana plant.
• Indo National to provide corporate guarantee of Rs 8.5 crore on behalf of subsidiary.
• Punjab Chemicals to consider raising funds at its board meeting on Dec. 8.
• Atlas Cycles says lenders Bank of Baroda and Central Bank of India have downgraded the company debt to non-performing.
• Hatsun Agro paid Rs 2.07 crore to the income tax authorities as per the settlement commission order.
• Reliance Communications says petition filed by Fortuna PR is misconceived.
• IRB Infra acquired additional 2.40 lakh units of IRB invit.
• Byke Hospitality acquires 3 hotels in Shimla, Kovalam and Matheran.
• Dalmia Bharat, Piramal Bain tie up for Binani Cement bid (Economic Times)

Bulk Deals

• 5paisa Capital: Promoter Nirmal Jain bought 1.25 lakh shares or 1 percent equity at Rs 191.22 each.
• Sical Logistics: Samyaktva Constructions bought 3.68 lakh shares or 0.7 percent equity at Rs 215.37 each
• C&C Constructions: Trupti Karani sold 2.22 lakh shares or 0.9 percent equity at Rs 81.74 each.

Century Textiles

• Cygnet Industries bought 17.85 lakh shares or 1.6 percent equity at Rs 1295.50 each
• Camden Industries sold 17.85 lakh shares or 1.6 percent equity at Rs 1295.50 each

Technofab Engineering

• Karuna Rajan sold 95,659 shares or 0.9 percent equity at Rs 232.58 each. Held 1.20 lakh shares (1.15 percent).
• Consolidated Infrastructure Co. sold 55,000 shares or 0.5 percent equity at Rs 233.16 each. Held 1.34 lakh shares (1.28 percent).

Mandhana Retail Ventures

• Mentor Capital bought 1.79 lakh shares or 0.8 percent equity at Rs 136.01 each
• Azarel fashions Pvt. Ltd. sold 1.78 lakh shares or 0.8 percent equity at Rs 136 each

Corporate Action

• Last trading day before ex-entitlement for buyback: Novartis and Lovable Lingerie.
• Circuit filter revised to 10 percent: Oceanic Foods.
• Circuit filter revised to 5 percent: Ramky Infra and Soma Textiles.

Who's Meeting Whom?

• PI Industries to have a concall with Credit Suisse on Dec. 6.
• MCX to meet Ask Investment Managers on Dec. 6 and Nalanda on Dec. 7.
• PSP Projects to meet Systematix Shares and Stocks on Dec. 7.
• Concor to meet Dalal & Broacha Stock broking on Dec. 7 and Quantum Mutual Fund on Dec. 8.
• Tata Steel to meet Rare Enterprises on Dec. 8.

Insider Trades

• Lupin Promoter bought 50,000 shares on Dec. 4.
• Rubfila International promoter sold over 90,000 shares from Nov. 20-24.
• Aro Granite promoter bought 18K shares on Dec. 4.

Rupee

• Rupee closed at 64.39/$ on Tuesday Vs 64.37/$ on Monday

IPO

• Shalby Limited IPO continues on day 2. The issue was subscribed 0.21 times on day 1.
• Future Supply Chain Solutions IPO opens with a price band of Rs 660-664.

Future Supply Chain IPO: Here's all you need to knowhttps://t.co/zqG32655Cm pic.twitter.com/MYv2aXGm9k

December 6, 2017

Top Gainers And Losers

Index Trends

F&O Cues

• Nifty December Futures trading at 10,146.7, premium of 28.7 points versus 31.5 points.
• December Futures: Nifty open interest up 6 percent, Bank Nifty open interest up 3 percent
• India VIX closed one percent higher at 15.
• Max open interest for Dec. series at 10,500 Call (open interest at 62.2 lakh, up 1 percent).
• Max open interest for Dec. series at 10,000 Put (open interest at 80.4 lakh).

F&O Ban

• No securities in ban list.

Put-Call Ratio

• Nifty PCR at 1.16 from 1.18.
• Nifty Bank PCR at 1 from 0.93.

Stocks Seeing High Open Interest Change

Fund Flows

Brokerage Radar

Morgan Stanley on Aditya Birla Capital

• Initiated ‘Equal-weight' rating with price target of Rs 185.
• Expect steady rise in profitability in lending and asset management.
• ABCL gives good exposure to rising financialisation in India.
• Expect net profit compound annual growth rate of 33 percent and 35 percent for NBFC and AMC respectively by March 2020.
• Positives: diversified loan book, low cost of funds and low cost of operations.
• Good long-term growth story but near-term valuation seems full.
• Higher rates and competition from PSU banks will likely remain an overhang.
• Would turn positive if there is strong pickup in growth and/or sustained increase in return ratios.
• Bull Case price target of Rs 330: Expect strong volume coupled with improvement in profitability.

CLSA on Bharat Forge

• Maintained ‘Buy' with price target of Rs 905.
• Outlook for Bharat Forge's exports improved.
• Demand pick-up in US trucks and industrial exports.
• Expect earnings per share to grow at a compound annual growth rate of 34 percent by March 2020.
• Valuations not cheap but should sustain.
• Tightening emission norms (BS-VI) is positive; Electrification is a long-term risk.

Jefferies on Housing Finance

• Housing Finance Companies to see steady loan growth.
• Affordable housing gaining traction, especially LIG/EWS.
• Positive on HFCs for medium term, but expect near term headwinds.
• Prefer asset financiers with strong growth and leverage to rural recovery.
• Prefer PNB Housing; Consumer Finance like Bajaj Finance and M&M Financials.

Citi on M&M

• Maintained ‘Buy'; Raised price target to Rs 1,700 from Rs 1,670.
• Farm equipment remains on a solid footing; But is overshadowed by utility vehicles weak performance.
• Target price raised to adjust for stock prices of listed subsidiaries.
• M&M is trying to put together an EV business dealing with regulatory uncertainty and ensuring capex don't rise.

CLSA on Dish TV

• Maintained ‘Buy'; raised price target to Rs 108 from Rs 97.
• Concerned on slow recovery in ARPU/subscribers, but big merger synergies ahead.
• Management has reiterated net synergies of Rs 510 crore in the next financial year from merger.
• Expect Dish TV to deliver 10 percent Ebitda compound annual growth rate by March 2020 pre-merger.
• Full synergy realisation to drive further 16 percent upside.

B&K on Dish TV

• Maintained ‘Outperformer'; raised price target to Rs 95 from Rs 90.
• Incremental recovery in operating metrics.
• Management expects ARPU to improve in the current and next quarter, partly aided by GST.
• Outperformer rating due to share price correction, recovery in ARPU, improved earning visibility and merger with Videocon d2h.

HDFC Securities on Dish TV

• Maintained ‘Buy'; cut price target to Rs 102 from Rs 105.
• Positive on the back of digitisation, merger with Videocon d2h and inexpensive valuations.
• Materialization of synergy benefits post-merger is key near-term trigger.
• Favourable ruling from the court on license fee, would increase price target by Rs 15.

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