Nifty, Sensex Close At New Records Led By Banks

Bhansali Engineering Polymers: The Mumbai-based chemical maker was locked in 5 percent upper circuit at record high of Rs 209.10 after it reported December quarter earnings.

• Net Revenue up 110 percent to Rs 258 crore versus Rs 123 crore
• EBITDA margin more than doubled to 16.8 percent versus 7.4 percent
• Net Profit rose 850 percent to Rs 29 crore versus Rs 3 crore

Hathway Cables: Shares of the Mumbai-based cable TV service provider rose as much as 20 percent to Rs 48.70 after 36 lakh shares changed hands in a single block.

Butterfly Gandhimathi Appliances: The Chennai-based pressure cooker maker rose as much as 8.99 percent to record high of Rs 634 after well-known investor Ashish Kacholia and a few mutual funds bought stake in the company.

• IDFC MF bought 1 lakh shares or 0.6 percent equity at Rs 580 each.
• Ashish Kacholia bought 1.52 lakh shares or 0.9 percent equity at Rs 580 each.
• Standard Chartered MF bought 3 lakh shares or 1.7 percent equity at Rs 579.99 each.
• Reliance Alternative Invest Fund sold 8.5 lakh shares or 4.8 percent equity at Rs 580.67 each.

La Opala: The Kolkata-based maker of glass and glass products rose as much as 20 percent to record high of Rs 744 after the company informed stock exchanges that its board will consider bonus issue on Feb. 5.

• Indian equity benchmarks continued their record run led by gains in banking and finance shares.
• The S&P BSE Sensex rose 0.95 percent or 330 points to 34,920 and the NSE Nifty 50 Index advanced 0.73 percent or 78 points to 10,758.
• The mid-cap and small-cap shares were underperforming their large-cap peers as the S&P BSE MidCap Index was little changed while the S&P BSE SmallCap Index rose 0.4 percent.
• Overall breadth was positive as 1,634 stocks were advancing while 1,274 were declining.
• Twelve out of 19 sector gauges compiled by BSE were trading higher led by the S&P BSE Finance Index's 1.8 percent jump. On the other hand, the S&P BSE Auto Index was the top sectoral loser, down 0.8 percent.

Top Nifty Gainers

• HDFC
• ICICI Bank
• UltraTech Cement
• Zee Entertainment
• Ambuja Cements

Top Nifty Losers

• Eicher Motors
• GAIL India
• ONGC
• HCL Technologies
• Hero MotoCorp

Shares of the state-run lender rose over a percent to Rs 61.70 after the bank informed stock exchanges that it will be raising Rs 2,730 crore from government via preferential allotment of shares.

• Hathway Cable: The Mumbai-based satellite TV service provider rose as much as 20 percent to Rs 48.70. Trading volume was 71.2 times its 20-day average.
• Capital First: The Mumbai-based non-banking finance company rose as much as 7.7 percent. trading volume was 16.6 times its 20-day average.
• DEN Networks: The Delhi-based satellite TV service provider rose as much as 12 percent to Rs 149.55. Trading volume was 11.7 times its 20-day average.
• IDFC Bank: The Mumbai-based private sector lender fell 3.7 percent to Rs 65. Trading volume was 7.5 times its 20-day average.

Rajiv Lall says:

• See a cultural fit between the two organisations
• Believe that the control premium that transaction entails is modest
• Our stated goal was that of diversification
• Retail will become more than 50 percent of the loan book

V. Vaidyanathan says:

• We had the capabilities and they had the bank
• There still are banks which are growing their liability base by 20-30 percent
• Not too concerned about the pecking order of private banks
• Warburg has little over 10 percent stake in merged entity so they may have to dilute marginal stake
• Retail gives me peace of mind, I could be biased to it
• Looking at building a bank which can grow at 15-20 percent per annum for many years
• Will need to raise Rs 3,000 crore for CRR/SLR requirements

Shares of the Indian caustic soda and soda ash makers were trading higher after Chinese environmental authorities ordered closure of manufacturing facilities.

China and Europe are turning net importers of caustic from net exporter and few plants in China are operating at less at 50 percent capacity due to various issues, according to ICIS- Agency for Petro Market Information.

• Tata Chemicals up 0.3 percent
• Lords Chloro Alkali up 5 percent
• Punjab Alkalies up 5 percent
• Atul Ltd up 2 percent
• DCW up 5 percent
• Sree Rayalaseema up 6 percent
• Andhra Sugars up 8 percent

Wholesale Price Inflation rises lower than anticipated in December.https://t.co/d2f54FX02y pic.twitter.com/vHQDrfomfi

— BloombergQuint (@BloombergQuint) January 15, 2018

Shares of the Hyderabad-based specialty pharma company rose as much as 4.44 percent to Rs 150.50 after the Reserve Bank of India hiked foreign investment limit in the company to 49 percent from 24 percent.

Shares of the telecom equipment maker rose as much as 4.94 percent to Rs 36.10 after it emerged as the lowest bidder for more than Rs 2,600 crore GIS based optical fibre network management system for which Bharat Sanchar Nigam Limited has yet to issue advance purchase order, the company said in a stock exchange filing.

Shares of the Chennai-based software developer rose as much as 8.27 percent to Rs 422 after the promoters of the company Virtusa set Rs 370 as indicative price for delisting which is at 59.2 percent premium to the floor price of Rs 232.37.

Shares of the country's second largest private sector lender by assets rose as much as 4 percent, the most in nearly two months, to Rs 330.70 after international brokerage Morgan Stanley said the stock has potential to return over 50 percent this year as its loan quality and weak profitability 'turn around meaningfully' over the next few months.

Meanwhile, Morgan Stanley has added ICICI Bank to its Asian Banks Model Portfolio with weight of 7.5 percent.

Will Sensex touch the 35,000 mark today?https://t.co/d2f54FX02y

— BloombergQuint (@BloombergQuint) January 15, 2018

Shares of the Mumbai-based real estate developer rose as much as 8.3 percent to Rs 69.15 after its board's finance committee approved allotment of two crore warrants at issue price of Rs 70.50 per warrant to its promoter Sarang Wadhawan, the company said in a stock exchange filing on Saturday.

• Hathway Cable and Datacom has 36 lakh shares change hands in a single block. Stock up 12.32 percent at Rs 45.60.

Buyers and sellers were not immediately known

Source: Bloomberg

Shares of IDFC Bank and Capital First rose as much as 3.19 percent and 7.59 percent each respectively after the boards of both the entities on Saturday approved a merger creating a lender which will have a portfolio diversified across large corporate lending, small and medium enterprise loans and retail credit.

Shareholders of Capital First will get 139 shares of IDFC Bank for every 10 held, IDFC Bank said in a statement after its board meeting on Saturday. V Vaidyanathan, founder and executive chairman of Capital First will take over as the chief executive officer of the merged entity after all regulatory approvals.

The rupee rose by 23 paise to trade at 63.40 against the dollar in opening session today, helped by strong gains in domestic stocks and losses in the greenback in obverses markets.

The rupee opened strong at 63.45 at the interbank forex market against previous close of 63.63 per dollar as stocks soared to record levels after strong economic data.

The rupee moved in range of 63.4875 per dollar to 63.3900 per dollar in early session before quoting at 63.40, displaying strong gains of 23 paise against the greenback.

Industrial production growth zoomed to a 17-month of 8.4 per cent in November 2017.

Selling of the American currency by exporters supported the rupee, forex dealers said.

The US dollar was struggling against the yen and pound after reports of monetary tightening by Bank of Japan.

On Friday, the rupee had ended higher by a modest three paise at 63.63 against the US dollar in a highly volatile trade.

Source: PTI

Here’s how foreign and local funds played the market on Friday.https://t.co/oPKj3FmHt0 pic.twitter.com/SGLBUGiRE6

— BloombergQuint (@BloombergQuint) January 15, 2018

• ABC Bearings
• Delta Corp
• Federal Bank
• India Grid Trust
• Zee Learn

Infosys Q3 (QoQ)

• Net sales up 1.3 percent at Rs 17,794 crore.
• Net profit up 37.7 percent at Rs 5,129 crore.
• EBIT up 1.7 percent at Rs 4,319 crore.
• Margins at 24.3 percent versus 24.2 percent.

TGV Sraac Q3 (YoY)

• Revenue up 22 percent at Rs 273 crore.
• Net profit up 221 percent at Rs 10.6 crore.
• Ebitda up 58 percent at Rs 50.5 crore.
• Margin at 18.5 percent versus 14.3 percent.

RIIL Q3 (YoY)

• Revenue down 8 percent at Rs 21.1 crore.
• Net profit down 1 percent at Rs 2.67 crore.
• Ebitda down 30.6 percent at Rs 3.4 crore.
• Margin at 16.1 percent versus 21.3 percent.

Sintex Industries Q3 (YoY)

• Revenue up 44 percent at Rs 840 crore.
• Net profit down 50 percent at Rs 21 crore.
• Ebitda down 32 percent at Rs 57 crore.
• Margin at 6.8 percent versus 14.3 percent.

• Nifty January futures trading at 10,686, premium of 5 points versus 3 points.
• January Series: Nifty open interest up 1 percent; Bank Nifty open interest up 12 percent.
• India VIX ended at 13.7, down 2 percent.
• Max open interest for January series at 11,000 Call (open interest up 5 percent at 47.3 lakh).
• Max open interest for January series at 10,500 Put (open interest at 81.5 lakh, down 1 percent).

• Apollo Micro Systems IPO subscribed 248 times on final day.

• TeamLease Services and Healthcare Global’s foreign institutional investor limit reached 24 percent, no further buying allowed.
• Granules India’s foreign institutional investor limit increased to 49 percent from 24 percent.
• Hindustan Motors revised its circuit filter to 10 percent.

Butterfly Gandhimathi Appliances

• IDFC MF bought 1 lakh shares or 0.6 percent equity at Rs 580 each.
• Ashish Kacholia bought 1.52 lakh shares or 0.9 percent equity at Rs 580 each.
• Standard Chartered MF bought 3 lakh shares or 1.7 percent equity at Rs 579.99 each.
• Reliance Alternative Invest Fund sold 8.5 lakh shares or 4.8 percent equity at Rs 580.67 each.

APL Apollo Tubes

• Emblem FII sold 2 lakh shares or 0.8 percent equity at Rs 2,228.23 each.

Hathway Cable

• Small cap World Fund Inc sold 44.6 lakh shares or 0.5 percent equity at Rs 40.4 each.

Gayatri Projects

• Socite Generale bought 25 lakh shares or 1.4 percent equity at Rs 217.35 each.
• UBS CH Equity Fund-Emerging Markets bought 70 lakh shares or 3.9 percent equity at Rs 208 each.
• Afrin Dia sold 70 lakh shares or 3.9 percent equity at Rs 208 each.

Greenlam Industries

• Sundaram Rural India Fund bought 3.57 lakh shares or 1.5 percent equity at Rs 1,315 each.
• Jwalamukhi Investment Holdings sold 3.56 lakh shares or 1.5 percent equity at Rs 1,315 each.

Menon Bearings

• Astute Investments sold 7.75 lakh shares or 1.4 percent equity at Rs 110.2 each.

Emami Papers

• Ganpati Industrial Private Ltd. bought 9.04 lakh shares or 1.5 percent equity at Rs 226.29 each.

• HDFC’s board approved to raise Rs 13,000 crore by selling shares to institutional investors and QIP.
• HDIL Board approves allotment of Rs 200 crore warrants to promoter at Rs 70.5 per warrant.
• Boards of the IDFC Bank Ltd. and Capital First Ltd. approved a merger between the two entities.
• RBI Approves to hike FPI limit in Granules India to 49 percent from 24 percent earlier.
• TRAI cuts international interconnect charges to 30 paise per minute.
• Southern Petrochemicals to shut down its plants for maintenance.
• Religare Enterprises revises value of health insurance operations over delayed sale to Rs 1,350 crore.
• Eclerx to consider details of share buyback on Jan. 23.
• Lasa Supergenerics to consider conversion of unsecured loans into equity at EGM on Feb. 7.
• Filatex India’s expansion project at Dahej commences trial production.
• Trigyn Technologies receives multiyear IT services contract worth $1.5 million from IFAD, Rome, Italy.
• REC transfers entire stake in wholly owned subsidiary REC Transmission To Power Grid.
• 3i Infotech’s U.S. subsidiaries merge together.
• EXIM Bank declares Venus Remedies and its directors as “wilful defaulters”.

Geojit ICICI Pru Life

• Initiated ‘Buy’ with price target of Rs 450.
• Outlook on Indian life insurance sector remains bright.
• Indian life insurance industry is at the cusp of enormous growth.
• ICICI Life is well-positioned to capture the strong growth.
• Best play on life insurance sector.
• Expect ICICI Life to deliver 22 percent and 15 percent in return on equity and return on enterprise value in the next financial year.
• Expect new business premium to grow at a compounded rate of 20 percent over the financial years through March 2019.
• Strong brand and parentage; Well placed on distribution.
• Remains outperformer in private life insurance despite challenging business environment.
• Diversified multi-channel distribution network gives a competitive edge.
• Under-penetrated market provides significant growth opportunity.

HSBC on Guajarat Pipavav

• Upgraded to ‘Buy’ from ‘Hold’; raised price target to Rs 174 from Rs 144.
• Pipavav is set to receive another two weekly services.
• Rebound in India-China EXIM trade bodes well given exposure to Far East.
• Earnings momentum to resume an upward trend in the near future.
• These service wins along with improved trade outlook raised earnings estimate.

Equirus on Whirlpool

• Initiated ‘Add’ with a price target of Rs 1,717.
• With favorable industry dynamics Whirlpool is well-poised for growth.
• Plugging portfolio gaps to drive incremental volumes, improve brand image.
• Distribution network expansion, new product launches to drive growth.
• Revenue growth to be powered by refrigerators, WM and ACs.
• Expect revenue, operating income and net profit to grow at a compounded rate of 19 percent, 21 percent and 20 percent respectively over the financial years through March 2020.
• Stock trades at reasonable valuations.
• Refrigerator segment – penetration levels to increase to 43 percent by March 2022.
• Washing machines – Growth to be driven by fully-automatic machines.
• Air conditioning segment – Split ACs to lead the way.
• Focus on profitable growth to shore up operating income and net profit.

ICICI Direct on Himadri Speciality

• Initiated ‘Buy’ with price target of Rs 245.
• Growth visibility is healthy with impressive capex and firm financing plans amid robust product demand.
• Debt at controlled level; debt-to-equity steadily on decline.
• Expect revenue, operating income and net profit to grow at a compounded rate of 22.7 percent, 29.3 percent and 38 percent respectively over the financial years through March 2020.
• Expect Himadri to command premium valuations among its peers.
• Coal tar pitch: Dominance to sustain; cash cow.
• SNF a construction chemical is big opportunity.
• Carbon black: Industry in sweet spot, Himadri a key beneficiary.
• Advance carbon material to fetch high margins and boost earnings from March 2020.
• Himadri is one of the only few listed players with exposure to Electric Vehicle.

Brokerages On Capital First-IDFC Bank Merger

Edelweiss

• Capital First: Maintained ‘Buy’, Raised price target to Rs 1,033 from Rs 927.
• IDFC Bank: Maintained ‘Hold’, raised price target to Rs 74 from Rs 67.
• Merger is a step in right direction to achieve stated intentions of both entities.
• Merger will be synergistic, value accretive and provide an opportunity to build a robust banking franchise.
• Immediate term benefits flow more to Capital First.
• Value combined entity at Rs 36,400 crore, i.e., 1.75 times next financial year’s book
• All regulatory approvals (RBI, CCI, SEBI, etc) to take almost 9-12 months.
• Ramp up of liability franchise will be a key monitorable.

Antique

• Lower borrowing costs is one of the potential benefit of merger.
• Increased provisioning costs to offset benefits from lower borrowing costs.
• Capital First huge SME book to witness higher provisions in banking.
• Combined entity to trade between 2-2.2x during integration phase, translating to Rs 70-75.
• Further upside contingent upon successful integration and re-alignment of bank strategy.
• Expect 10-12 percent price upside to Capital First; No significant upside to IDFC Bank.

Credit Suisse on Infosys

• Maintained ‘Neutral’; raised price target to Rs 1,100 from Rs 1,000.
• Previous quarer results were in line; Guidance maintained.
• U.S. and financial services soft, but management outlook is positive.
• Decent growth recovery in retail; No significant pick-up in large deals.
• Update on the new CEO's strategy only in April.
• Revise estimates to slightly lower tax rate and adjusting for recent buyback.
• Valuations are reasonable as stock underperformed in 2017.
• Do not see any near-term trigger.

CLSA on Infosys

• Maintained ‘Buy’; raised price target to Rs 1,300 from Rs 1,230.
• Previous quarter remained in line in revenue growth and steady margins.
• Tax cuts drive up next two financial year’s earnings per share estimates by 2 percent.
• Client mining stayed strong with solid growth in top client.
• Impressive margin performance continues despite hikes and variable pay.
• New CEO is yet to fully sponsor the strategic direction.
• Limited gap with peers, stability and improving execution deserves a rerating.

Edelweiss on Infosys

• Upgraded to ‘Buy’ from ‘Hold’; raised price target to Rs 1,265 from Rs 1,010.
• With new CEO in place expect highest margin levers, high dividend yield and undemanding valuations.
• Barring BFSI, all other businesses posted modest numbers in a weak quarter.
• BFSI, retail and digital look strong for 2018.
• BFSI, retail, digital and Europe all look promising.
• Downgraded earlier due to management instability.

Don’t let the rupee’s strength fool you, say strategists.https://t.co/1DfC3QECNZ pic.twitter.com/a7jFxHq6aX

— BloombergQuint (@BloombergQuint) January 15, 2018

Investors are betting there’s more to come from commodities after a surge in industrial metals and oil prices.https://t.co/5xHRBzvHoV pic.twitter.com/jWKOdV5hRs

— BloombergQuint (@BloombergQuint) January 14, 2018