Stocks To Watch: Bank Of Baroda, HDFC, M&M Financial, Mcleod Russel

• MCX completes first settlement cycle in options contract on gold futures.
• Laurus Labs receives tentative approval from USFDA for Tenofovir Disoproxil Fumarate.
  
• Reliance Power executes a pact for 750 MW in Bangladesh.

• LIC to pare stake in Bank of Baroda to 5.2 percent from 7.2 percent

Indian equity benchmarks fell tracking global declines, led by energy companies and lenders, ahead of two events yesterday – monthly derivatives expiry and GDP data for September quarter.

The S&P BSE Sensex fell 1.53 percent or 453 points to 33,149 and the NSE Nifty 50 Index slumped 1.3 percent or 135 points to 10,226.55. In November, Nifty declined over 1 percent and Sensex fell 0.19 percent.

The Singapore-traded SGX Nifty, an early indicator of NSE Nifty 50 Index's performance in India, fell 0.2 percent to 10,262.50 as of 7:45 a.m.

Here Are The Stocks To Watch Out For In Friday's Session:

• India's GDP growth rises to 6.3 percent year-on-year in the September quarter.
• HDFC to dilute stake in asset management unit via IPO. To hold 50.01 percent stake in the AMC business post stake dilution. Standard Life to hold 24.99 percent.
• Mahindra & Mahindra Financial Services opened QIP on Nov. 30, to raise up to Rs 1,056 crore at a floor price of Rs 439.63.
• Yes Bank says Moody's assigns Baa3 rating to its $1 billion MTN program.
• LT Foods to strengthen presence in European market. Plans to invest $20 million for overall branding and expansion.
• Reliance Communications says 31 foreign and Indian lenders oppose China Development Bank's insolvency plea.
• Reliance Power executes Phase I of 750 MW LNG power project in Bangladesh.
• Shilpa Medicare says NCLT approves scheme of merger of Navya Biologicals with self.
• Laurus Labs receives maiden tentative approval from U.S. FDA for Tenofovir Disoproxil Fumarate tablets. Drug is used for the treatment of HIV-1 infection in adults and pediatric patients 2 years of age and under.
• Mirza International receives MCA approval for scheme of merger between Hi-Life Fabricators and self.
• Thomas Cook opens two gold circle partner franchise outlets in Pune.
• MCX completed first settlement cycle in options contract on gold futures.
• Reliance Naval and Engineering said that there is no merit in IFCI application to the NCLT as it is an unsecured creditor.
• LIC to pare stake in Bank of Baroda to 5.2 percent from 7.2 percent.
• IIFL Special Opportunities Fund acquires stake in Nazara Technologies for approximately Rs. 330 crore.

F&O Setup

• Nifty December Futures trading at 10,278.6, premium of 52 points versus 38 points.
• All series: Nifty open interest up 8 percent; Bank Nifty open interest up 6 percent.
• Rollover: Nifty at 63 percent, Bank Nifty at 55 percent.
• India VIX closed 3.7 percent up at 13.5.
• Max open interest for Dec. series at 10,500 Call (open interest at 49.5 lakh, open interest up 73 percent).
• Max open interest for Dec. series at 10,000 Put (open interest at 69.31 lakh, up 14 percent).

F&O Ban

• No securities in ban.

Active Stock Futures

Bulk Deals

• Asian Granito: Vignaharta Ceramics LLP sold 5 lakh shares or 1.7 percent stake at Rs 500 each.
• Filatex Holdings: Savita Holdings Pvt sold 3 lakh shares or 0.7 percent stake at Rs 225.05 each.
• Technofab Engineering: Equipment Mgmt sold 1.4 lakh shares or 1.3 percent stake at Rs 302 each.
• Petronet LNG: Integrated Core Strategies (Asia) PTE sold 80.34 lakh shares or 0.5 percent stake at Rs 251.37 each.
• SRG Housing Finance: Promoter Vinod Jain HUF bought 71,000 shares or 0.5 percent stake at Rs 229.25 each.
• Agro Tech Foods: Samsung India Securities Master Investment Trust bought 2 lakh shares or 0.8 percent stake at Rs 620.93 each.

Mcleod Russel

• Promoter Kamal Kishore Baheti sold 1 crore shares or 9.1 percent stake at Rs 205.26 each.
• Nomura Trust and Banking Co bought 60.58 lakh shares or 5.53 percent stake at Rs 205.08 each.
• Nomura Funds Ireland India Equity bought 23.13 lakh shares or 2.11 percent stake at Rs 205.09 each.

Zydus Wellness

• Reliance Capital bought 5 lakh shares or 1.3 percent stake at Rs 910 each.
• Baring India Private Equity Fund III Listed Investments sold 5 lakh shares or 1.3 percent stake at Rs 910 each.

Apollo Hospitals

• Nordea 1 Sicav bought 9.74 lakh shares or 0.7 percent stake at Rs 1103.25 each.
• MSCI Equity Index Fund B India sold 8.47 lakh shares or 0.6 percent stake at Rs 1107.49 each.

Capacite Infraprojects

• Societe Generale bought 21 lakh shares or 3.1 percent stake at Rs 416.96 each.
• Paragon Partners Growth Fund sold 21 lakh shares or 3.1 percent stake at Rs 417 each.

Vakrangee

• DB International Asia sold 47.26 lakh shares or 0.9 percent stake at Rs 709.5 each.
• Integrated Core Strategies (Asia) PTE sold 39.44 lakh shares or 0.7 percent stake at Rs 712.5 each.

Earnings Reactions To Watch

Cerebra Integrated Technologies (Q2, QoQ)

• Revenue up 71 percent at Rs 60 crore.
• Net profit up 63 percent at Rs 7 crore.
• EBIT up 42 percent at Rs 7.4 crore.
• Margin at 12.3 percent versus 14.9 percent.

Shreyans Industries (Q2, YoY)

• Revenue up 8 percent at Rs 107.6 crore.
• Net profit up 14 percent at Rs 7.3 crore.
• EBITDA down 8 percent at Rs 12.7 crore.
• Margin at 11.8 percent versus 13.9 percent.

UFO Moviez (Q2, YoY)

• Revenue down 13 percent at Rs 139 crore.
• Net profit down 43.5 percent at Rs 11.3 crore.
• EBITDA down 31 percent at Rs 38 crore.
• Margin at 27.3 percent versus 34.6 percent.

Warren Tea (Q2, YoY)

• Revenue up 33 percent at Rs 44 crore.
• Net profit up 10 percent at Rs 14.6 crore.
• EBITDA up 18 percent at Rs 16 crore.
• Margin at 36.4 percent versus 41.2 percent.

Results Today

• Mahindra Logistics
• 8K Miles Software
• Setco Automotive
• Pondy Oxides
• Vimta Labs
• Yash Papers

Brokerage Radar

Ventura Securities On Talwalkars Better Value Fitness

• Initiated ‘Buy' rating with price target of Rs 728; implying a potential upside of of 173 percent over 24 months.
• Talwalkars is the market leader and twice as large as the next best peer.
• Fitness industry offers a huge opportunity.
• Sound business strategy to expand and transform into a wellness brand.
• Demerger to bring superior return to the gym company leading to sharp re-rating.
• Expect gym company to grow its revenue, operating income and net profit at 19 percent, 21.6 percent and 25.8 percent respectively by March 2020.
• Expect lifestyle company to grow revenue, operating income and net profit at 11.2 percent, 12.8 percent and 11.3 percent by March 2020.
• Significant scope for further re-rating given its dominant position and under-penetrated market.

Nomura On IndusInd Bank

• Maintained ‘Buy'; raised price target to Rs 1,950 from Rs 1,850.
• Growth robust - expect no impact from PSU recapitalisation.
• Bank continues to build on niche verticals.
• Bharat Financial acquisition to increases bank's rural presence.
• Expect return on equity improvement improvement through cost efficiency; Bank targets 200 basis points cost income reduction by March 2020.
• Expects credit costs to remain at 65 basis points for the current financial year. It is likely to come down to 60 basis points by March 2019.

Edelweiss On Pharma Sector

• U.S. drug pricing probe is bringing several more companies and products into its purview.
• The charges include fixing prices and rigging bids.
• Indian companies impacted: Sun Pharma, Aurobindo, Zydus, Dr. Reddy's and Glenmark.
• High probability that these companies will be charged penalties.
• If allegations proved, companies may be prosecuted criminally, with fines up to twice the amount of gain or loss involved.

Motilal Oswal On November Auto Sales

• Retails momentum mixed for two-wheelers and commercial vehicles; passenger vehicle segment healthy.
• Healthy wedding season demand partially negated by untimely rains.
• Demand momentum in rural markets continues to be healthy.
• Hero outperformed in motorcycles, capitalizing on healthy wedding season demand in North India.
• Maruti continues to see better retail sales than competitors; Tata too is gaining momentum.
• Demand for commercial vehicles is not exciting; discounts increased sequentially.
• Prefer four-wheelers over two-wheelers and commercial vehicles due to stronger volume growth and stable competitive environment.
• Top Picks: Maruti, Bajaj Auto, Tata Motors and Amara Raja.
• M&M as the best bet on a rural market recovery.

Nomura On November Auto Sales

• Low base of demonetisation to drive strong growth for medium and heavy commercial vehicles, followed by two-wheelers and passenger vehicles.
• Expect passenger vehicle industry to report 16 percent year-on-year growth.
• Maruti to outperform the industry with 17 percent growth.
• Medium and heavy commercial vehicle segment and two-wheeler segment to grow 34 percent and 24 percent respectively year-on-year.
• Medium and heavy commercial vehicle segment: Ashok Leyland, Tata Motors and Eicher Motors' volume to grow 23 percent, 35 percent and 26 percent respectively on a yearly basis.
• Two-wheeler segment: Hero MotoCorp, Bajaj Auto and Eicher Motors' volume to grow 21 percent, 35 percent and 27 percent respectively on a yearly basis.

CLSA On Maruti

• Maintained ‘Buy' with price target of Rs 10,000.
• India passenger vehicle industry showing signs of easing competitive intensity.
• Easing competitive intensity, in small cars and entry sedans, is positive for Maruti.
• More Original Equipment Manufacturers could potentially enter India but unlikely to make a dent .
• Maruti likely to broaden its sport utility vehicle portfolio in coming years, though competition is high.
• Valuations seem rich, but justified given high earnings visibility and improving outlook.

Credit Suisse On Escorts

• Initiated ‘Outperform' rating and price target of Rs 900; implying a potential upside of 26 percent from yesterday's close.
• Escorts is fourth-largest tractor manufacturer with niche construction equipment and railways business.
• Tractors account about 80 percent of revenues and 95 percent of profits.
• Expect tractor growth cycle to remain strong for another two years.
• Tractors volumes to grow at compound annual growth rate of 11 percent by March 2021.
• Expect tractor operating margins to improve by 400 basis points to 14 percent by March 2020.
• Escorts' has best earnings growth and lowest valuation multiple among auto original equipment manufacturers.
• Expect fast top-line growth at railways and margins turnaround in construction equipment division.

Brokerages On India's Q2 GDP

Goldman Sachs

• Growth accelerated in September quarter, in line with expectations.
• India's real GDP growth recovery led by higher growth in fixed investment is encouraging.
• There are still some headwinds to activity due to uncertainties around GST.
• Expect solid growth momentum next year and forecast real GDP growth of 8 percent in the next fiscal.

Credit Suisse

• GDP growth recovered in September quarter largely due to GST related restocking.
• Remain constructive on second half's growth on recovery in private consumption, and improving global growth momentum.
• Expect full-year growth to disappoint consensus due to continued disruptions from GST and higher oil prices.
• Expect inflation to stay in RBI's target range in the second half as we expect impact of higher oil prices.
• Continue to expect the RBI to cut rates by 25 basis points in first quarter of 2018.

Deutsche Bank

• GDP growth in the September quarter indicates that the economy has started to stabilize at a modest pace.
• Expect growth to average around 6.6 percent during the current financial year.
• Optimistic about the outlook for the next financial year and beyond.
• Reasonable to expect growth to return close to 8 percent by March 2020.
• Do not expect RBI to cut rates any further.

Media Reports

• Dr Reddy's gets nod to restart exports to EU from Vizag plant (PTI).
• Rosneft Deal: Essar to pay Rs 910 crore to retail shareholders by Dec. 10 (Business Line).
• Power tariff hike in UP day after municipal polls (Financial Express).
• Allahabad Bank to sell its 30 percent stake in Sompo Insurance; Bank's CEO says the insurer may get listed after two years, a good time for them to exit (Economic Times).

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