All You Need To Know Going Into Trade On March 21

Stocks in Asia were poised for modest advances after a rally in crude oil buoyed U.S. equities. Japan is closed for a holiday.

The Singapore-traded SGX Nifty, an early indicator of NSE Nifty 50 Index’s performance in India, traded flat at 10,153 as of 6:55 a.m.

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

Global Cues

• U.S. stocks edged higher, led by energy-related companies, as equity markets shrugged off weakness in technology and threats of global trade barriers.
• The yield on 10-year Treasuries rose three basis points to 2.88 percent.

Europe Check

• European stocks gained for the first time this week as energy companies rallied with oil, offsetting weakness in telecom firms.
• Germany’s 10-year yield rose one basis point to 0.58 percent.
• Britain’s 10-year yield climbed four basis points to 1.48 percent.
• The euro fell 0.7 percent to $1.2250, in the biggest drop in more than a week.
• The British pound fell 0.2 percent to $1.4001.

Asian Cues

• Australia’s S&P/ASX 200 Index rose 0.3 percent.
• Futures on Hong Kong’s Hang Seng Index gained 0.2 percent.
• S&P 500 Index futures fell less than 0.1 percent.

Here are some key events on the schedule this week:

• The Fed decision and Jerome Powell’s news conference come on Wednesday.
• The Bank of England is expected to keep interest rates and its asset-purchase program unchanged on Thursday. Attention will be on language and the odds for a May hike.
• New Zealand has a monetary policy decision Thursday.
• Company earnings scheduled for this week include Tencent, Hermes, PetroChina and Nike.

Commodity Cues

• West Texas Intermediate crude built on a 2.2 percent advance to gain 0.6 percent to $63.76 a barrel.
• Brent trades higher at $67.6 per barrel; up 0.3 percent.
• Gold was at $1,310.25 an ounce.
• Sugar ends lower at 12.6 cents per pound; down 2.6 percent.

Shanghai Exchange

• Steel snapped three-day losing streak; up 1 percent.
• Aluminium traded lower for the second day; down 0.4 percent.
• Zinc traded near three-month low; down 2 percent.
• Copper traded near six-month low; down 1.2 percent.
• Rubber traded lower for fourth day; down 0.6 percent.

Indian ADRs

Stocks To Watch

• Jindal Steel opens QIP at a floor price of Rs 227.15 apiece.
• Amtek says Liberty’s resolution plan not yet approved by lenders.
• TCS partners with Saudi Real Estate Refinance company.
• Greenply Industries mulls demerger of MDF business. The board also approved expansion of Veneer Line at Gabon factory.
• Fortis to seek shareholders’ approval for RHT acquisition.
• Newgen Software released Mobile Medicare Enrolment solution for U.S. health plans.
• Ashoka Buildcon declared lowest bidder for two projects worth Rs 447.51 crore.
• Transport Corporation of India acquired one ship with capacity of 26,262 DWT for Rs 48.80 crore.
• Dalmia Bharat unit provides performance bank guarantee of 10 percent for upfront payment to lenders in Binani Cement.
• Mercator to sell vessel for $4.25 million to Best Oasis Ltd; will use proceeds to repay debt.
• Manappuram Finance approved business plan for FY19.
• Transport Corp acquired a new ship to increase capacity in west coast.

Also Read: UltraTech Will Fight Off A Web Of Litigation To Buy Binani Cement: Exclusive

Media Reports

• Arcelor Mittal likely to offer Rs 3,000 crore to Uttam Galva to settle dues (Financial Express).
• IndiGo, Qatar Airways to amake a joint bid for Air India (Financial Express).

Bulk Deals

• Jindal Cotex: LTS Investment Fund sold 3.86 lakh shares or 0.9 percent equity at Rs 7.1 each.
• Intrasoft Technologies: Vora Financial services bought 86,329 shares or 0.6 percent equity at Rs 703 each.

IDFC Bank

• Copthall Mauritius Investment sold 96.74 lakh shares or 0.6 percent equity at Rs 50 each.
• Baobab Global Fund bought 96.74 lakh shares or 0.6 percent equity at Rs 50 each.

Sarveshwar Foods

• India Max Investment Fund sold 4.09 lakh shares at Rs 70.5 each.
• Krishen Bal bought 4.06 lakh shares at Rs 70.5 each.

Corporate Action

• India Nippon Electricals stock split from Rs 10 to Rs 5 per share.
• La Opala RG last trading day before going ex bonus.
• DCM Financial Services last trading day before shifting to T group.

Who’s Meeting Whom

• Navin Fluorine to meet investors, analysts on March 21.
• Shriram Transport Finance to meet Balyasny Asset Management on March 26.
• Narayana Hrudayalaya to meet Janchor Partners on March 21 in Hong Kong.
• Balkrishna Industries to meet analysts, investors on March 21.
• Jain Irrigation to meet KBI Global Investors on March 21.

Insider Trades

• Chambal Fertilizers promoter SIL Investments Ltd acquired 58,787 shares on March 19.
• Chaman Lal Setia promoter Sukarn Setia sold 5,100 shares from March 15–16.
• Bhageria Industries promoters acquire 50,000 shares on March 19.
• Career Point promoter Pramod Maheshwari acquired 10,926 shares on March 19.

IPO Watch

• Mishra Dhatu Nigam IPO opens at an issue price of Rs 87-90 per share.
• Hindustan Aeronautics IPO subscribed 0.99 times on final day.
• Karda Construction IPO subscribed 1.42 times on final day.
• Sandhar Technologies IPO continues on day 3. The issue is subscribed 0.4 times.

Rupee

• Rupee closed at 65.20/$ on Tuesday from 65.18/$ on Monday.

Top Gainers And Losers

Index Trends

F&O Cues

• Nifty March futures closed trading at 10,143.2, premium of 18.9 points from 28.8 points.
• March series: Nifty open interest unchanged, Bank Nifty open interest down 5 percent.
• India VIX ended at 15.6, down 1.3 percent.
• Max open interest for March series at 10,500 call strike (open interest at 63.8 lakh, down 3 percent).
• Max open interest for March series at 10,000 Put (open interest at 66 lakh, up 5 percent).

F&O Ban

• In ban: Dewan Housing, HDIL, IDBI Bank, IFCI, Jindal Steel, JP Associates, Reliance Communications, SAIL.
• New in ban: IFCI, Jindal Steel.
• Out of ban: BEML.

Only intraday positions can be taken in stocks which are in F&O ban. There is a penalty in case of rollover of these intraday positions.

Put-Call Ratio

• Nifty PCR at 1.05 from 1.04.
• Nifty Bank PCR at 0.92 from 0.99.

Stocks Seeing High Open Interest Change

Fund Flows

Brokerage Radar

Credit Suisse on Emami

• Maintained ‘Outperform’ with price target of Rs 1,260.
• Distribution challenges being overcome.
• Wholesale channel stabilised; E-way bill to be closely watched.
• Margins not a major concern for now.
• Focus on double-digit volume growth through a combination of existing and new products.

Credit Suisse on HDFC

• Maintained ‘Outperform’ with price target of Rs 2,250.
• Strong growth in individual segment.
• Competition picking up in corporate segment.
• RERA would lead to some consolidation of the smaller players.
• Open to inorganic opportunities in housing segment.
• Looking at opportunities in health insurance space within HDFC ERGO.

Macquarie on Indian Steel

• Demand in China is just delayed, and not curtailed.
• Domestic prices and demand remains robust.
• Raw material weakness to partially offset steel price weakness.
• Domestic fundamentals remain robust.
• Steel producers to deliver $20-30/t QoQ margin expansion in current quarter.
• Positive on both Tata Steel and JSW Steel post recent correction.
• Tata Steel offers better risk-reward.

JPMorgan on Kotak Mahindra Bank

• Maintained ‘Overweight’; raised price target to Rs 1,200 from Rs 1,100.
• Bank in a strong position to leverage reduced competitive intensity in core banking.
• Elevated valuations supported by strong growth momentum and resilient asset quality.
• Bank's subsidiaries in a sweet spot.
• Kotak Mahindra Bank one of top picks.

ICICI Securities on Dr. Reddy’s

• Upgraded to ‘Add’ from ‘Hold’; cut price target to Rs 2,378 from Rs 2,487.
• Several triggers to revive growth and margins over the next two fiscals.
• US revenue run rate likely to bottom out in current fiscal.
• Price erosion likely to remain in double digit in the next fiscal.
• Several drivers in place to offset base business price erosion and drive U.S. sales.
• Current valuations factor in all negatives.
• Successful outcome of triggers may lead to valuation re-rating.

HDFC Securities on CDSL

• Initiated ‘Buy’ with price target of Rs 425; implying a potential upside of 50 percent from the last regular trade.
• Gem of a business that investor constructive on India in the long term must own.
• Depository business is a proxy for capital market growth.
• Limited scope for any other depository to be set up.
• Diversified revenue stream with high component of annuity revenue.
• Operates at healthy operating margin with embedded non-linearity.
• CDSL gaining market share
• Robust balance sheet and cash generation.
• Pays healthy dividend; Payout could be higher.
• Expect revenue, operating income and ent profit to compound at 22 percent, 28 percent and 20 percent respectively over the fiscal 2017-2020.
• Operating margin to expand to 64 percent by March 2020, compared to 54.4 percent, clocked in the previous fiscal, led by fixed cost business model.

ICICI Direct on NGL Fine-Chem

• Initiated ‘Buy’ with price target of Rs 465 – Rs 505.
• After stagnation, capacity expansion to support future growth.
• Likely adoption of dual source strategy to benefit Indian players.
• Expect revenue, operating income and net profit to compound at 15 percent, 14 percent and 19 percent respectively over the fiscal 2017-2020.
• Stock offers a compelling value proposition based on micro and macro parameters.