All You Need To Know Going Into Trade On November 8

Asian stocks declined, suggesting a pause in a rally that lifted regional equities to the highest levels in at least a decade. The dollar slipped and the yen and Australian dollar edged higher, after a report that Senate Republican leaders are considering a delay in the implementation of a corporate-tax cut.

The Singapore-traded SGX Nifty, an early indicator of NSE Nifty 50 Index's performance in India, fell 0.11 percent to 10,399 as of 7:00 a.m.

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DayBreak

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

Global Cues

• U.S. stocks fell as investors turned their attention to fiscal policy, with tax writers from the House of Representatives expected to hammer out their plan this week.

#BQMarketsNow | U.S. stocks slide, dollar gains as taxes take focus.https://t.co/pkhjaxJDmF pic.twitter.com/OyHVk4It4d

Asian Cues

• The Nikkei 225 fell 0.4 percent in early trade. The Topix index declined 0.3 percent.
• The S&P/ASX 200 Index lost 0.2 percent, and South Korea's Kospi index was down 0.1 percent.
• Futures on Hong Kong's Hang Seng Index fell 0.5 percent.
• Futures on the S&P 500 fell 0.2 percent. The underlying gauge ended virtually unchanged Tuesday.
• The MSCI Asia Pacific Index gained 0.9 percent Tuesday to the highest in about 10 years. The MSCI Emerging Markets Index closed at the highest since mid-2011.

Here are some key upcoming events this week:

• U.S. consumer sentiment probably cooled in early November from a more than 13-year high; the University of Michigan's report is out on Friday.
• OPEC releases its World Oil Outlook.
• Thailand is expected to leave interest rates unchanged on Wednesday. Other central banks meeting on monetary policy this week: Argentina, Mexico, New Zealand and Malaysia.
• China October trade is slated for Wednesday.
• The European Commission's chief Brexit negotiator Michel Barnier and U.K. Brexit Secretary David Davis resume talks.
• Earnings season continues with announcements from Walt Disney Co., Adidas AG, and Siemens AG. European financial companies set to report include Banca Monte dei Paschi di Siena SpA, Credit Agricole SA, Allianz SE and Zurich Insurance Group AG.

Commodity Cues

• West Texas Intermediate crude traded at $57.02 a barrel.
• Gold was steady at $1,277.51 an ounce.
• Copper fell 2.2 percent Tuesday to about $3.09 a pound, the lowest in about a month. The Bloomberg Commodity Index dropped for the first time in seven days Tuesday.
• ICE sugar ended higher for third day at 14.72 $/lb; up 1.10 percent.

Shanghai Exchange

• Steel snaps six-day losing streak; down 0.67 percent
• Aluminium trades lower for fifth consecutive session; down 1.24 percent
• Zinc trades lower; down 1.57 percent
• Copper trades lower; down 1.87 percent
• Rubber trades lower; down 0.9 percent

Indian ADRs

Earnings To Watch

• Arvind
• Ashok Leyland
• Balkrishna Industries
• Bharat Forge
• Bombay Dyeing
• CESC
• Chennai Petroleum
• Future Consumer
• IRB Infrastructure
• Mahanagar Gas
• Mas Financial
• Petronet LNG
• Pidilite Industries
• Shree Cement
• Thermax
• Va Tech Wabag
• Voltas
• Welspun India

Results Announced

Dhampur Sugar (Q2FY18, YoY)

• Revenue up 15 percent at Rs 802 crore
• Net profit up 62 percent at Rs 60 crore
• EBITDA up 14 percent at Rs 121 crore
• Margin at 15.1 percent versus 15.2 percent

Johnson Controls-Hitachi Air Conditioning India (Q2FY18, YoY)

• Revenue up 11 percent at Rs 317 crore
• Net loss of Rs 0.2 crore from loss of Rs 5.6 crore
• EBITDA at Rs 9.5 crore versus EBITDA loss of Rs 2 crore
• Margin at 3 percent versus -0.7 percent

HealthCare Global Enterprises Ltd (Q2FY18, YoY)

• Revenue up 21 percent at Rs 211 crore
• Net profit doubled to Rs 10 crore
• EBITDA up 26 percent at Rs 31.5 crore
• Margin at 14.9 percent versus 14.4 percent

Butterfly Gandhimathi Appliances (Q2FY18, YoY)

• Revenue up 29.7 percent at Rs 201 crore
• Net profit at Rs 11.5 crore
• EBITDA at Rs 17 crore
• Margin at 8.45 percent versus 5.8 percent

L&T Technology Services Ltd (Q2FY18, QoQ)

• Revenue up 9.5 percent at Rs 901 crore
• Net profit up 25.5 percent at Rs 12.3 crore
• EBIT up 10 percent at Rs 138 crore
• Margin at 15.3 percent versus 15.2 percent

Essel Propack (Q2FY18, YoY)

• Revenue up 11.6 percent at Rs 640 crore
• Net profit down 26 percent at Rs 52.5 crore
• EBITDA up 20.5 percent at Rs 132.5 crore
• Margin at 20.7 percent versus 19.2 percent

DCM Shriram (Q2FY18, YoY)

• Revenue up 17.5 percent at Rs 1,605 crore
• Net profit up 88 percent at Rs 172 crore
• EBITDA up 138.5 percent at Rs 291 crore
• Margin at 18.1 percent versus 8.9 percent

Indian Overseas Bank (Q2FY18, YoY)

• Net interest income up 18.3 percent at Rs 1520.4 crore
• Net loss of Rs 1,222 crore versus loss of Rs 765 crore
• Gross NPA at 22.73 percent versus 23.6 percent (QoQ)
• Net NPA at 13.86 percent versus 14.9 percent (QoQ)

Liberty Shoes (Q2FY18, YoY)

• Revenue up 17 percent at Rs 126 crore
• Net profit down 35 percent at Rs 1.1 crore
• EBITDA up 4 percent at Rs 9.6 crore
• Margin at 7.6 percent versus 8.5 percent

Glaxo Consumer (Q2FY18, YoY)

• Revenue up 3 percent at Rs 1,115 crore
• Net profit up 4 percent at Rs 192 crore
• EBITDA up 6.5 percent at Rs 261.6 crore
• Margin at 23.5 percent versus 22.7 percent

Himatsingka Seide (Q2FY18, YoY)

• Revenue up 10 percent at Rs 578.5 crore
• Net profit up 10 percent at Rs 50.6 crore
• EBITDA up 9 percent at Rs 99.5 crore
• Margin at 17.2 percent versus 17.3 percent

Filatex India (Q2FY18, YoY)

• Revenue up 8 percent at Rs 414.5 crore
• Net profit up 12.5 percent at Rs 13.5 crore
• EBITDA up 6 percent at Rs 36 crore
• Margin at 8.7 percent versus 8.9 percent

Monte Carlo (Q2FY18, YoY)

• Revenue up 12 percent at Rs 138 crore
• Net profit up 15.55 percent at Rs 15.6 crore
• EBITDA up 8 percent at Rs 26 crore
• Margin at 18.8 percent versus 19.5 percent

Dalmia Bharat (Q2FY18, YoY)

• Revenue up 7 percent at Rs 1834 crore
• Net profit up 235.5 percent at Rs 104 crore
• EBITDA up 5 percent at Rs 442 crore
• Margin at 24.1 percent versus 24.6 percent

Huhtamaki PPL (Q2FY18, YoY)

• Revenue down 2 percent at Rs 546 crore
• Net profit up 15 percent at Rs 19 crore
• EBITDA up 11 percent at Rs 62 crore
• Margin at 11.35 percent versus 10 percent

Jindal Saw (Q2FY18, YoY)

• Revenue down 0.75 percent at Rs 13.2 crore
• Net profit up 20 percent at Rs 0.6 crore
• EBITDA down 12.5 percent at Rs 2.1 crore
• Margin at 15.9 percent versus 18.0 percent

Hindusthan National Glass (Q2FY18, YoY)

• Revenue up 7 percent at Rs 431 crore
• Net loss of Rs 71 crore versus profit of Rs 38 crore
• EBITDA down 32 percent at Rs 32 crore
• Margin at 7.4 percent versus 11.7 percent

Adlabs Entertainment (Q2FY18, YoY)

• Revenue down 2.7 percent at Rs 36 crore
• Net loss of Rs 57 crore versus loss of Rs 44 crore
• EBITDA loss at Rs 2 crore
• Margin at -5.6 percent versus 2.7 percent

Finolex Cables (Q2FY18, YoY)

• Revenue up 24.9 percent at Rs 702 crore
• Net profit down 5 percent at Rs 100 crore
• EBITDA down 0.5 percent at Rs 98.5 crore
• Margin at 14.0 percent versus 17.6 percent

Manappuram Finance (Q2FY18, YoY)

• Net interest income up 6.9 percent at Rs 528 crore
• Net profit down 5.3 percent at Rs 170.2 crore

Tata Coffee (Q2FY18, YoY)

• Revenue up 4 percent at Rs 382 crore
• Net profit down 23 percent at Rs 23 crore
• EBITDA down 15.5 percent at Rs 71 crore
• Margin at 18.6 percent versus 22.88 percent

RSWM (Q2FY18, YoY)

• Revenue down 7.7 percent at Rs 686 crore
• Net loss of Rs 2.5 crore versus profit of Rs 27 crore
• EBITDA down 47 percent at Rs 49 crore
• Margin at 7.1 percent versus 12.5 percent

Stocks To Watch

• Sun Pharmaceutical's subsidiary Taro Pharma reported a strong performance during the previous quarter.
• Axis Bank board to meet on Nov. 10 to consider raising funds.
• Three Pillars PTE to sell up to 19.99 crore shares of Bharti Airtel in the range of Rs 473-480 per share.
• Adlabs to sell Novotel Imagica Khopoli Hotel for Rs 213 crore to Bright Star. It will also sell Walkwater stake to Blue Haven for Rs 150 crore.
• Indoco Remedies to resume manufacturing of ophthalmic products at Goa unit II.
• Akzo Nobel to divest India's specialty chemical business, likely to garner for Rs 320 crore.
• JSW Energy got an order to supply 200 MW power to Karnataka from November 8 - May 31.
• DCM Shriram to invest around Rs 500 crore in sugar business to increase overall capacity.
• NMDC mulls bidding for $9 billion mine (Financial Express)

Bulk Deals

Delta Corp

• Small Cap World Fund bought 1.02 crore shares or 3.8 percent equity stake at Rs 279.2 each (average).
• Rekha Rakesh Jhunjhunwala sold 25 lakh shares or 0.9 percent equity stake at Rs 280.35 each.
• Aarti J Mody Trust sold 18.2 lakh shares or 0.7 percent equity stake at Rs 280.4 each.
• Anjali J Mody Trust sold 18.2 lakh shares or 0.7 percent equity stake at Rs 280.37 each.

Aro Granite

• Dilipkumar Lakhi bought 82,848 shares or 0.5 percent equity stake at Rs 67.16 each.

Greenlam Industries

• Dovetail India Fund bought 2.08 lakh shares or 0.9 percent equity stake at Rs 998 each.
• Morgan Stanley Mauritius sold 2.03 lakh shares or 0.8 percent equity stake at Rs 998 each.

MPS

• ICICI Lombard General Insurance bought 6.33 lakh shares or 3.4 percent equity stake at Rs 585 each.
• Goldman Sachs India Fund sold 6.33 lakh shares or 3.4 percent equity stake at Rs 585.01 each.

PDS Multinational

• EQ India Fund bought 1.45 lakh shares or 0.6 percent equity stake at Rs 235.08 each.

Selan Exploration

• KIFS Enterprises bought 1 lakh shares or 0.6 percent equity stake at Rs 256.96 each.

Veto Switchgear

• Promoter Veto Electropowers India sold 2.50 lakh shares or 1.4 percent equity stake at Rs 210 each.

Ajmera Realty

• Promoter Shashikant S Ajmera bought 2.56 lakh shares or 0.7 percent equity stake at Rs 293.79 each.
• Shashikant S. Ajmera HUF sold 2.56 lakh shares or 0.7 percent or equity stake at Rs 293.81 each.

IPO

• HDFC Standard Life Insurance IPO continues on day 2. The issue was subscribed 0.46 times on day 1.

Who's Meeting Whom?

• Vakrangee to meet analysts and investors in Hong Kong on Nov. 8-9.
• Cipla to meet investors on Nov. 9-10 and Dec. 4.
• TVS Motor to meet Wellington EM Fund on Nov. 22-23.
• Blue Star to meet Steadview capital on Nov. 8.
• Bharat Forge to meet Axis Capital on Nov. 9, CLSA on Nov. 14 and UBS on Nov. 16.
• Indiabulls Housing Finance to conduct road show with Nomura from Nov. 6-9 in Hong Kong and Tokyo.

Rupee

• Rupee closed at 65.03/$ on Tuesday from 64.68/$ on Monday

Top Gainers and Losers

Index Trends

F&O Cues

• Nifty November futures closed at 10,409.9, premium of 59.9 points from 37.7 points.
• November contracts: Nifty open interest down 5 percent; Bank Nifty open interest down 1 percent.
• India VIX closed 1.6 percent higher at 13.2.
• Max open interest for November series at 10,500 Call (open interest at 41.9 lakh, up 28 percent).
• Max open interest for November series at 10,000 Put (open interest at 56.7 lakh, down 9 percent).

F&O Ban

• In ban: DHFL, HDIL , Indiabulls Real Estate, India Cement, Infibeam, JSW Energy, Reliance Communication, Wockhardt.
• New in ban: India Cement.

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

Put-Call Ratio

• Nifty PCR at 1.43 from 1.55.
• Nifty Bank PCR at 1.01 from 1.20.

Stocks Seeing High Open Interest Change

Fund Flows

Brokerage Radar

Morgan Stanley on Banks

• Axis: Maintained ‘Overweight'; hiked price target to Rs 630 from Rs 555.
• ICICI: Maintained ‘Overweight'; hiked price target to Rs 365 from Rs 345.
• SBI: Maintained ‘Overweight'; hiked price target to Rs 370 from Rs 360.
• Risk-reward significantly favourable to investors, even from current levels.
• Recap will clean up the books for the large corporate lenders.
• Expect some pick-up in core pre-provision operating profit as net interest margins improve.
• Return on assets for Axis Bank and ICICI Bank to improve to 1.5 percent and 0.9 percent for SBI.

CLSA on Lupin

• Maintained ‘Buy'; Cut price target to Rs 1,030 from Rs 1,260.
• Goa and Indore plants account for 70 percent of U.S. sales and have 50 pending approvals.
• Lupin is looking to site transfer 12 products on a priority basis.
• Despite the warning letter, expect Lupin to maintain current U.S. sales of $200 million/quarter and overall operating margin of 20 percent.
• Cut earnings per share estimates for the next two financial years by 15 percent and 20 percent respectively on lower U.S. sales.

Credit Suisse on Lupin

• Upgraded to ‘Neutral' from ‘Underperform'; Cut price target to Rs 875 from Rs 900.
• Upgrade because of limited downside; Contribution of the ex-US business is worth Rs 600 per share.
• Warning letter at Goa and Indore does not impact the key product Levothyroxine.
• Due to delayed launches, cut earnings per share estimates for the next financial year by 8 percent.
• Next event is release of warning letter details which is expected by next week.

Morgan Stanley on Lupin

• Downgraded to ‘Equalweight' from ‘Overweight'; Cut price target to Rs 847 from Rs 1,219.
• Warning letter to delay niche approvals by 9-15 months, leading to earnings headwinds.
• Cut net profit estimates for the next two financial years by 24 percent and 22 percent respectively to account for lower U.S. business.
• Expect two-quarter delay of levothyroxime to the second half of the next financial year.

CLSA on Cipla

• Maintained ‘Buy'; hiked price target to Rs 730 from Rs 655.
• U.S. sales ramp-up to drive the previous quarter's earnings growth.
• Strong India business, U.S. ramp-up and cost control to expand margins over next few years.
• Cost control to show up further but U.S. sales growth is key .
• Raised earnings per share estimates by 3-5 percent to reflect results for the current financial year.

Credit Suisse on Cipla

• Maintained ‘Outperform'; hiked price target to Rs 700 from Rs 600.
• U.S. upside has started due to Renvela launch in the previous quarter; Cost control continues.
• Expect second half to be strong led by accrual of Renvela cash flows, approvals for couple of products and India growth.
• Inventory days should further improve by 4-5 days from current 8-10 days.
• Cipla has the lowest price erosion risk and is the biggest beneficiary of faster approvals.

UBS on BHEL

• Maintained ‘Sell' with price target of Rs 49.
• Revenues missed estimates during the previous quarter, resulting in operating loss.
• Abundant untied thermal capacity, thermal capacity under construction and sharp decline in renewable tariffs to keep order inflows low.
• Medium term order inflows unlikely to surpass revenue estimates of the current and next financial years.
• Expect stagnation in order book, slow momentum in the non-power business and weak of return on equity.

Macquarie on BHEL

• Maintained ‘Underperform' with price target of Rs 72.
• Bulk of the positives, like restart of stalled projects, L1 pipeline is factored in.
• With slow revenue turnaround, the entire operating leverage story falls flat.
• Structural headwinds remain with renewables, NPA in thermal power and under-utilisation of existing plants.

UBS on Emami

• Maintained ‘Buy'; Hiked price target to Rs 1,500 from Rs 1,300.
• Expect volume growth to bounce back to 10-12 percent from a low-growth phase.
• Emami's investment in direct distribution and cash & carry to augur well over the next three years.
• Well positioned for a rural recovery; Herbal preference to help retain consumer preference.
• New product launches are keys to sustained revenue momentum.

CLSA on L&T Technology

• Maintained ‘Buy'; hiked price target to Rs 980 from Rs 950.
• Stellar rise in revenue during the previous quarter, deal wins continue but softer margin.
• Increase revenue estimates or the financial years till March 2020 by 2-4 percent and cut margin estimate for by 80-120 basis points for the period.
• L&T Technology remains an attractive play on secular growth in engineering services.

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