All You Need To Know Going Into Trade On September 21

Asian stocks opened mixed on Thursday while the yen declined as the dollar extended gains against major peers after the U.S. Federal Reserve paved the way for another interest-rate increase this year.

The Singapore-traded SGX Nifty, an early indicator of NSE Nifty 50 Index's performance in India, declined 0.30 percent to 10,137 as of 6:45 a.m.

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

Global Cues

• U.S. stocks eked out gains in a volatile session, with the Dow industrials and the S&P 500 carving out fresh all-time highs.
• While policy makers left the benchmark interest rate unchanged, markets reacted to officials' hawkish forecast for where rates will be at the end of the year.

#BQMarketsNow | U.S. markets end flat; oil above $50 per barrel mark.https://t.co/ZAA78IX8uL pic.twitter.com/FnbdpXsLWF

Asian Cues

• Japan's Topix index climbed 0.6 percent in early trade. The Kospi index and Australia's main benchmark were little changed.
• Futures contracts on Hong Kong's Hang Seng Index fell.
• Attention now turns to the Bank of Japan, which ends a two-day policy meeting on Thursday.
• All 45 economists forecast BOJ will keep stimulus unchanged

Fed eyes another hike this year, Bank of Japan up next, and a rough day for Apple. https://t.co/ZzMf1G9AzE

Commodity Cues

• West Texas Intermediate crude climbed 0.6 percent to $50.70 a barrel following a 1.9 percent advance. A drop in U.S. fuel supplies boosted the outlook for crude demand.
• Gold lost 0.2 percent to $1,298.04 an ounce.
• ICE sugar rose 2.3 percent to 14.70 cents a pound.

Shanghai Exchange

• Steel trades higher; up 0.24 percent
• Aluminium trades higher for third day; up 1.22 percent
• Zinc trades higher for fifth consecutive session; up 0.43 percent
• Copper snaps two-day winning streak, down 0.28 percent
• Rubber trades higher after losing for five consecutive session; up 0.93 percent

Indian ADRs

Stocks To Watch

• NBCC bags Rs 3,200 crore project from the finance ministry to develop a residential-cum-office complex in Mumbai
• Novartis India's board to consider the proposal for buyback at its meeting on September 25
• Granules India QIP opens; Floor price set at Rs 127.63 per share
• Reliance Capital says Reliance Home Finance Ltd. to list on September 22
• SMS Pharma mulls joint venture with Chemo S.A. (Switzerland)
• Den Networks received NCLT nod to demerge its broadband/internet service arm Skynet Cable
• Allahabad Bank's board approves merger with subsidiary AllBank Finance
• ITDC signs pact for transfer of Lalitha Mahal Palace Hotel, Mysore to Government of Karnataka
• NPPA fixes ceiling price of 39 more drug formulations
• Walchandnagar Industries Circuit filter revised to 10 percent
• Yes Bank Ex-date for 5:1 stock split. Futures and options lot size revised to 1,750
• Dishman Carbogen Amcis to be relisted after reverse merger of Carbogen Amcis into company
• Lasa Supergenerics, a demerged entity of Omkar Speciality Chemicals, to list on exchanges
• Amtek Auto creditors likely to meet soon (Financial Express)
• Reliance Industries plans major expansions at world's largest oil refinery complex
• SBI starts the process to sell non-core assets; to hire merchant bankers (Mint)

Bulk Deals

Om Metal Infraprojects

• Equity Intelligence India buys 7.3 lakh shares or 0.8 percent stake at Rs 62.7 each
• EQ India Fund buys 5.75 lakh shares or 0.6 percent stake at Rs 62.24 each
• Udgam Commercial sold 14.1 lakh shares or 1.5 percent stake at Rs 62.23 each

Mirc Electronics

• KIFS Electronics buys 12 lakh shares or 0.6 percent stake at Rs 28.76 each

Kajaria Ceramics

• WestBridge Crossover Fund sold 35.75 lakh shares or 2.2 percent stake at Rs 722.62 each

Bank of Baroda

• Theleme Master Fund sold 7.58 crore shares or 3.3 percent stake at Rs 147.06 each
• Merrill lynch Markets Singapore bought 7.58 crore shares or 3.3 percent stake at Rs 147.08 each

Magma Fincorp

• Leapfrog financial inclusion India holdings sold 53 lakh shares or 2.2 percent stake at Rs 180.1 (average) each
• HSBC Global Investment Fund bought 22.3 lakh shares or 0.9 percent stake at Rs 180.17 each

Veto Switchgear

• Promoters Veto Electropowers India sold 5 lakh shares or 2.7 percent stake at Rs 217.5 each
• Jayanti Dahyabhai Patel bought 2.5 lakh shares or 1.4 percent stake at Rs 215 each
• Paru Securities bought 2.57 lakh shares or 1.4 percent stake at Rs 220.02 each

Vadivarhe Specialty Chemical

• Garnet International bought 1.65 lakh shares at Rs 126 each

Omkar Specialty Chemicals

• Promoter Omkar Herlekar sold 1.25 lakh shares or 0.6 percent stake at Rs 86.1 each

IOL Chemicals and Pharma

• Indiastar(Mauritius) Ltd sold 11 lakh shares or 2 percent stake at Rs 57.5 each

Balasore Alloys

• Promoter Navoday Niketan Pvt Ltd sold 4.46 lakh shares or 0.5 percent stake at Rs 62.44 each

IPO

• Matrimony.com to make stock market debut after concluding its Rs 500 crore initial public offer last week.
• SBI Life Insurance IPO continues on day 2. The issue has been subscribed 0.09 times so far.

Rupee

• Rupee ended at 64.26/$ from 64.32 on Tuesday

Who's Meeting Whom?

• Eicher to meet FII investors on September 21
• Zee Media to meet Karma Capital and B&K on September 21
• Hindalco to meet FII investors on September 21
• Cochin Shipyard to meet Reliance MF on September 21
• Vedanta to meet investors on September 21
• Astral Poly to meet Bio Advisors & DHFL Pramerica on September 21
• Tata Chemicals to meet SBI Life Insurance on September 21
• Dixon Tech to meet Steadview Capital & Dragoneer on September 22

Top And Worst Performers Of 2017 (NSE 500)

Index Trends

F&O Cues

• Nifty September Futures closed with a premium of 26.5 points from 21 points
• September Nifty Futures open interest up 2 percent, Bank Nifty open interest down 4 percent
• India VIX closed higher by 1.4 percent at 11.46
• September series highest Call base at 10200 (open interest at 56 lakh )
• September series highest Put base at 10,000 (open interest at 56.9 lakh, open interest down 4 percent)
• Call strikes 10,000, 10,100 sees unwinding of open interest & addition seen for 10,300 & 10,400
• Put strikes 10,000, 10,100 sees unwinding of open interest & addition seen for 10,300

F&O Ban

• In ban: Bharat Earth Movers, DHFL, HDIL, Indiabulls Real Estate, Indo Count, India Cements, Infibeam, JP Associates, JSW Energy, Just Dial
• New in ban: Indo Count, India Cement

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

Put-Call Ratio

• Nifty PCR unchanged at 1.57
• Nifty Bank PCR at 1.16 from 1.28

Stocks Seeing High Open Interest Change

• South Indian Bank saw open interest addition of 14 percent on long side
• NALCO saw open interest addition of 10 percent on long side
• Hindalco saw open interest addition of 8 percent on short side
• Karnataka Bank saw open interest addition of 8 percent on long side
• NBCC saw open interest addition of 7 percent on long side
• Tata Steel saw open interest addition of 6 percent on long side
• Infibeam saw open interest unwinding of 16 percent, long unwinding was seen
• Kotak Mahindra Bank saw open interest unwinding of 13 percent, long unwinding was seen

Fund Flows

Brokerage Radar

Macquarie on United Spirits

• Maintain Underperform; Hike price target to Rs 1,933 from Rs 1,600
• Expecting price increases in Telangana; 10 percent price hike to boost EBITDA margins by 50-60 basis points
• Channel checks suggest muted volume growth in Q2FY18; But situations improving
• Expect prestige segment volume growth CAGR of 7 percent for next three years
• EBITDA CAGR of 16 percent 340 basis points margins expansion for next three years

Axis Capital on Divi's Lab

• Upgrading to Buy; Hiked price target to Rs 1,080 from Rs 625
• Quick U.S. FDA re-inspection could be due to large dependence of innovator/generic companies
• Increase FY19 EPS estimates by 15 percent with improved visibility on U.S. FDA resolution
• Expect earnings to start improving from end FY18/FY19
• Expect 16 percent revenue growth; 250 basis points EBITDA margin expansion in FY19

Edelweiss on Tata Steel

• Maintain Buy with price target of Rs 720
• Deal will aid consolidation and pare debt of balance sheet
• Rs 90 per share benefit due to synergies of EUR400-600 million
• Merger likely to create second largest player in Europe

IDFC Securities on Tata Steel

• Maintain Outperformer; Hiked price target to Rs 694 from Rs 623
• Deal will restrict any future cash outflows from Indian operation
• Proposed JV is expected to be financially self- sustainable
• Net debt will fall to Rs 49,800 crore from Rs 69,300 crore post JV

Axis Capital on Tata Steel

• Maintain Buy; Hiked price target to Rs 765 from Rs 690
• Tata Steel as the company can now focus on Indian growth opportunity
• Tata Steel would now likely look to expand Kalinganagar (Odisha) capacity

CLSA on Tata Steel

• Maintain Buy; Hiked price target to Rs 850 from Rs 800
• Synergies to drive EPS; Focus back on India
• Deal to be EPS accretive by 14-18 percent & value accretive by 4-6 percent by FY20
• FY20 consolidated net debt to drop by 28 percent; Net debt/EBITDA remain unchanged at 3.1 times.
• Expect regulatory approvals to complete by March 2019

Macquarie on Tata Steel

• Maintain Underperform; Hiked price target to Rs 560 from Rs 505
• Free cash flow from JV to service remaining EU debt
• Increase FY18 EBITDA estimates by 6 percent on steel price resistance
• Increase FY18 and FY19 EPS estimates by 13 percent and 1 percent respectively
• Tata Steel is well placed to benefit from the recent steel price resistance

Credit Suisse on Tata Steel

• Maintain Outperform; Hiked price target to Rs 800 from Rs 720
• Closing expected in late CY18 post regulatory approvals
• Expect synergies value to be Rs 100 per share
• Increase FY18 EPS estimates by 6.5 percent

Morgan Stanley on Dr. Reddy's

• Upgraded to Overweight from Equalweight; Hiked price target to Rs 3,133 from Rs 2,798
• Expect earnings recovery in FY19/20 driven by key product launches in U.S. over next 4-8 quarters
• Cost control and positive operating leverage to lead earnings CAGR of 57.2 percent for FY19-20
• India business to see steady recovery after GST over the next few quarters

IDFC Securities on Zee

• Zee has created a strong business model with its disciplined content investments
• Weak ad growth commentary, led to cut FY18 ad growth estimate to 12 percent versus 14 percent earlier
• FY18/19 earnings estimates cut by 3 percent; expect net profit to grow at CAGR of 19 percent over FY17-19
• Advertising and subscription revenue to grow at CAGR of 15 percent and 16 percent respectively over FY17-19

On Bharat Electronics After Analyst Meet

IDFC Securities says

• Maintain Outperform with price target of Rs 220
• Annual order inflow momentum to sustain at Rs 15,000 crore over FY18-20
• Well-positioned to capture the growing defense spend
• Expect margins to drop by 170 basis points to 18.8 percent over FY17-FY19
• EBITDA to grow at CAGR of 14 percent over FY17-19
• Triggers:- sustained order inflows, long-term earnings potential & improvement in return ratios

Jefferies says

• Maintain Buy with price target of Rs 195
• Management guided 16 percent YoY revenue growth and double-digit order flow growth
• BEL-Thales joint venture likely to take time to ramp-up
• Two new business areas: homeland security and space-linked equipment

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