Sensex, Nifty moderately higher ahead of state elections results
2:00 pm Market Check: Equity benchmarks wiped out all gains in afternoon as investors remained cautious ahead of assembly elections results and ignored exit poll results announced yesterday.
Exit poll results announced by various media agencies yesterday were not clear as some said BJP may get majority and some said it may not in Uttar Pradesh that gives parliament most number of representatives. Hence, experts say wait for final elections results due tomorrow.
Nilesh Shah, MD, Kotak Mahindra AMC says the actual results many a times have been different from exit polls. So, Tuesday would be a better day to gauge the market move, post the actual outcome of election results for Uttar Pradesh.
The 30-share BSE Sensex was down 32.41 points at 28896.7 and the 50-share NSE Nifty fell 12.15 points to 8914.85. About 1550 shares declined against 1119 advancing shares on the BSE.
Indian equity markets will remain shut on Monday for Holi holiday.
ICICI Bank, Reliance Industries, SBI, ITC, Tata Steel and ONGC were leading contributors to Sensex’s fall, down 0.5-1 percent whereas Infosys, TCS, L&T and HDFC Bank continued to support the market.
1:55 pm Edelweiss upgrades JSPL: “We upgrade Jindal Steel & Power (JSPL) to buy as Angul capacity ramp up will propel sales volume by around 30 percent CAGR to 6.8 million tonne amidst relatively benign steel environment owing to capacity closures in China, resulting in 32 percent EBITDA CAGR over FY16-19; and high probability of net debt plummeting around 25 percent to Rs 33,500 crore through to FY19 post Rs 4,000 crore consideration from sale of 1,000MW power plant,” Edelweiss says in its note.
The stock is trading at 6.5x FY19 estimated EBITDA, at a sharp discount to 15 years’ trading average of 8.4x, it adds.
Edelweiss revised upward its FY18 and FY19 volumes estimates by 5 percent and 12 percent, respectively, and target price to Rs 160 (earlier Rs 97), implying 7.0x FY19 estimated EBITDA, which is at a discount to global peers.
1:46 pm Europe opening: Markets in Europe opened in positive territory as investors turned their attention to the release of nonfarm payrolls in the US.
Investors will continue to digest the European Central Bank’s decision to keep interest rates unchanged on Thursday. President Mario Draghi also signaled that there was no longer a sense of urgency to take further monetary action.
Meanwhile, the focus will be on US data, where nonfarm payrolls will bring more clarity on whether the Federal Reserve will announce an interest rate hike next week.
1:39 pm FII View: Even if BJP wins in UP, life for investors will not change much, says Samir Arora, Founder & Fund Manager at Helios Capital. On the other hand, if BJP disappoints then it would have mattered only for few days.
Arora further said that global markets are doing well and foreign investors are showing interest in India.
1.32 pm Stake sale: Canara Bank has sold 13.45 percent stake in Can Fin Homes to Caladium Investment, Singapore, an affiliate of GIC, Singapore’s Sovereign Wealth Fund, numbering 35.8 lakh shares at Rs 2,105 per share amounting to Rs 753.77 crore in an off-market deal on March 10 as a part of monetisation of non-core assets of the bank.
1:20 pm IPO subscription: Investors are applying aggressively to the initial public offering (IPO) of Avenue Supermarts, the operator of supermarket retail chain D-Mart.
According to data available on the National Stock Exchange (NSE), the issue has been oversubscribed 33 times as of 13 hours IST today —the closing day of the issue.
The reserved portion of qualified institutional buyers oversubscribed 48.7 times while the portion set aside for non-institutional investors subscribed 90.7 times and that of retail investors 5.76 times, according to CNBC-TV18.
1:00 pm Market Check: The market maintained its positive bias amid consolidation in afternoon as investors eagerly awaited results of assembly elections in five states due tomorrow. They also retained cautious stance ahead of Federal Reserve policy meeting next week.
The 30-share BSE Sensex was up 51.68 points at 28980.81 and the 50-share NSE Nifty gained 15.10 points at 8942.10.
Sanjay Dutt of Quantum Securities says if BJP does win in UP then it will reassure people that thrust of the government towards economic reforms will come through because of more majority in the Rajya Sabha, which until now was proving to be a hurdle.
He says in case the results in UP are beyond consensus then market is sure to rally 100-200 points.
The market breadth was more or less balanced. About 1302 shares advanced against 1271 declining shares on the BSE.
Technology, HDFC Group, infra and select auto stocks continued to support the market whereas oil and select banks stocks remained under pressure.
Infosys, HDFC, TCS, L&T, Hero Motocorp and Bharti Airtel gained 0.5-1 percent whereas ICICI Bank, ITC, ONGC, Reliance Industries, Asian Paints and Axis Bank were down.
Also read – Buy, sell, hold: 6 stocks to watch out for your portfolio
12:56 pm RCom to slash 4G, 3G rates: Reliance Communications is likely to cut rates for 2G, 3G and 4G to the lowest in the industry, sources have told CNBC-TV18.
The company may permanently cut 4G data prices to Rs 49 from Rs 149 for 1 GB data, and 3G prices to Rs 99 a month for unlimited data.
Meanwhile, prices of 2G services could see a revision to Rs 49 a month for unlimited data. The stock jumped 2.3 percent intraday following the developments.
12:44 pm D-Mart IPO subscribed 20 times: According to data available on the National Stock Exchange (NSE), the issue has been oversubscribed 20 times as of 12: 15 pm on Friday—the closing day of the issue.
It received bids worth for 87.5 crore shares against the total issue size of 4.43 crore shares.
12:30 pm Gold loan firms fall: Shares of gold loan companies, Manappuram Finance and Muthoot Finance, lost 6-7 percent intraday as investors turned cautious of Reserve Bank of India’s (RBI) announcement for restricting cash disbursements.
The central bank restricted cash disbursements on gold loans to Rs 20,000 from Rs 1 lakh earlier. This disbursement was restricted under Section 269 SS of the Income Tax Act.
The development is significant for these firms as 35 percent of Manappuram and 55 percent of Muthoot’s disbursements are in cash mode. The average ticket size of the gold loan is Rs 40,000 in both the cases.
12:18 pm Expert Speak: Even if BJP wins in UP, life for investors will not change much, says Samir Arora, Founder & Fund Manager at Helios Capital.
On the other hand, if BJP disappoints then it would have mattered only for few days. Arora further said that global markets are doing well and foreign investors are showing interest in India.
12:08 pm Market Check: The market held on to its trimmed gains ahead of key events such as assembly election results and US Federal Reserve’s meeting next week.
The 30-share Sensex was up 33.96 points at 28963.09, while the Nifty was up 8.90 points at 8935.90. The market breadth narrowed as 1,253 shares had advanced, 1,159 shares had declined, while 171 shares remained unchanged.
Infosys, Hero MotoCorp and UltraTech Cement were the top gainers on the indices, while Axis Bank, ONGC, Tech Mahindra and Power Grid were a drag.
Investors were applying aggressively to the initial public offering (IPO) of Avenue Supermarts, the operator of supermarket retail chain D-Mart. According to data available on the National Stock Exchange (NSE), the issue has been oversubscribed 11 times as of 11: 15 am on Friday—the closing day of the issue. It received bids worth for 48.31 crore shares against the total issue size of 4.43 crore shares.
Investors are now getting ready for the final results of the assembly elections after having reacted to the exit polls this morning.
11:56 am BJP meeting: The Parliamentary Board of the BJP may meet on March 11 afternoon when results of the five state assembly elections will be out.
With exit polls projecting a good show by the saffron party, including in the crucial state of Uttar Pradesh where it is projected to emerge as the single largest party, its highest decision-making body is likely to take stock of the situation and chalk out future strategy.
Prime Minister Narendra Modi and party chief Amit Shah are among the board’s 12 members who also include Union ministers Rajnath Singh, Arun Jaitley, Nitin Gadkari, Sushma Swaraj, Venkaiah Naidu, Ananth Kumar, Thawarchand Gehlot and J P Nadda.
A party source said the meeting has been tentatively scheduled for tomorrow. However, there is a possibility that it could be held on Sunday depending on how the results pan out.
11:49 am Buzzing: Shares of India Home Loan gained nearly 6 percent intraday after signing agreement with SUDA for providing housing loans.
“India Home Loan has entered into memorandum of understanding (MOU) with Surat Urban Development Authority (SUDA) for facilitating housing loans to borrowers in Surat,” the company said in its filing.
The company will provide housing loans to borrowers under economically weaker sections for buying houses or flats under the scheme of Mukhyamantri Gruh Yojna at various locations in Surat city.
11:35 am Market Expert: Sanjay Dutt, Director, Quantum Securities believes the government will remain focused on development and economy.
When asked to gauge the market reaction to the exit polls outcome of a BJP win in Uttar Pradesh, Shah says the actual results many a times have been different from exit polls. So, Tuesday would be a better day to gauge the market move, post the actual outcome of election results, he adds.
However, if BJP does win in UP then it will reassure people that thrust of the government towards economic reforms will come through because of more majority in the Rajya Sabha, which until now was proving to be a hurdle.
11:26 am Auto sales: Domestic passenger vehicle sales rose 9.01 percent to 2,55,359 units in February, from 2,34,244 in the same month last year.
Domestic car sales were up 4.9 percent at 1,72,623 units as against 1,64,559 in February last year, according to data released by the Society of Indian Automobile Manufacturers (SIAM).
The figure for motorcycles last month read 8,32,697 units as against 8,59,582 a year earlier, down 3.13 percent.
Total two-wheeler sales in February declined marginally to 13,62,045 units compared to 13,62,177 in the year-ago month.
Sales of commercial vehicles moved up 7.34 percent to 66,939 units in February, SIAM said.
11:15 am CLSA on consumer: CLSA says HUL’s personal care growth will exceed soaps & detergents. From FY07-16, the gap between personal care & soaps & detergents is merely 0.7 percent.
Interestingly, hair oil segment saw 15 percent CAGR, comparable to most personal care products, the brokerage house says.
It feels ITC’s cigarettes division will gain share in the overall tobacco pie. Despite initial regulation, ITC is expected to gain market share from bidis.
CLSA says Nestle India will outperform many of its peers. Its stock has returned a 21 percent CAGR in last 10 years against 25-30 percent from peers.
11:05 am Market check: After erasing morning gains, the market traded in a steady range as investors could now be awaiting for the actual results from the assembly elections on Saturday.
The 30-share Sensex was up 60.95 points at 28990.08, while the Nifty was up 15.95 points at 8942.95. The market breadth was narrow, with 1,301 shares having advanced, 920 shares having declined, while 147 shares were unchanged.
Hero MotoCorp, Infosys and UltraTech Cement were the top gainers on the indices, while ONGC, GAIL, Power Grid and Tech Mahindra were the top losers.
NBFCs Muthoot Finance and Manappuram Finance were under pressure after the Reserve Bank of India placed restrictions on cash disbursements of loans to Rs 20,000 from Rs 1 lakh earlier.
10:55 pm Goldman Sachs on Aurobindo: New product launches in the US, coupled with margin expansion is making Goldman Sachs upbeat on Aurobindo Pharma going forward. However, there are risks associated with the respect to drug pricing policy changes in the US and imposition of additional taxes.
The research firm has set a target price of Rs 934 with an upside potential of 40 percent.
10:30 pm MCX Interview: The Multi Commodity Exchange of India ( MCX ) is keen on exploring new product launch avenues in fiscal year 2017-18.
The exchange’s Managing Director and Chief Executive Mrugank Parajape told Moneycontrol that some of the commodities being looked at include pepper, palmolein, groundnut, brass and diamond.
Paranjape says there is definitely a market for diamond in the futures space and is betting Indian jewellery consumption and MCX’s partnership with Singapore Diamond Investment Exchange.
10:15 am Market Check: The market trimmed its early morning gains and was off day’s high on Friday. Investors probably are now waiting for the actual results of the assembly elections that is set to be announced on Saturday.
Exit polls conducted by several media outlets predict a BJP lead in almost all states, barring Manipur. The early morning rally could probably have been a reaction to these statistics.
The Sensex was up 70.13 points at 28999.26, while the Nifty was up 23.10 points at 8950.10. The market breadth was healthy, but was narrow as compared to the morning session. About 1,343 shares advanced, 674 shares declined, while 133 shares remained unchanged.
Hero MotoCorp, Larsen & Toubro and UltraTech Cement were the top gainers on the index while GAIL, ONGC, Power Grid and BPCL were a drag.
Shares of State Bank of India and Kalpataru Power Transmission gained 1-2 percent intraday ahead of board meeting of the companies. The meeting of central board of State Bank of India (SBI) is scheduled to be held on March 15 to consider raising of funds through equity capital by way of FPO/rights issue/ESPS/ESOS/QIP/ADR.GDR and any other mode or a combination of these at the appropriate time.
9:59 am Credit Suisse on Adani Ports: Credit Suisse has maintained outperform rating on the stock with a target price of Rs 360 as it feels valuations are reasonable at 16X FY19 estimated earnings.
Dhamra Port is a key beneficiary of potential scale-up of iron ore exports and the company has potential to generate strong operating cash flow of Rs 6,000 crore per year, it says.
Credit Suisse feels iron ore price correction, export duties and mining regulation are key risks.
9:54 am FII View: Surendra Goyal of Citi says if BJP is able to win UP then the setback in Punjab will not be overly concerning.
It will assure the ruling party that the policy thrust of the government is touching the right chords and the gamble of demonetisation didn’t cause much political damage, it feels.
Goyal says the crucial balancing act between reforms and popular policies to catch the mind space of poor voters will not need much course correction. In fact, since there are no further state elections in 2017, the BJP might be emboldened to carry on with its anti-corruption agenda and even push for more contentious reforms like labour reforms.
9:44 am Acquisition: One of the oldest pharmaceutical companies Unichem Labs is back on the block. Sources privy to the details say that it is scouting for buyers and have received interest from domestic and global companies.
Unichem’s domestic operations is 57 percent of its total sale. The company’s 10-12 percent of domestic portfolio is under National List of Essential Medicines.
CNBC-TV18, quoting sources, says that global companies are interested in the company as it will help them deepen distribution as well as hike drug volume in India.
9:31 am Mines auction: Mines auction is likely to fetch Rs 1.5 lakh crore to states’ kitty in 2017-18, a top official said.
The first tranche of auctions, which started last year, saw bidding of 21 mine blocks that fetched Rs 73,000 crore to states.
“We are looking at auction of 100 blocks in 2017-18. This should conservatively fetch about Rs 1.5 lakh crore to states and the revenue will accrue to them in a span of 50 years,” Mines Secretary Arun Kumar said.
The first successful auction took place in February 2016, with two small limestone blocks in Chhattisgarh going under the hammer. The mineral-rich state will generate about Rs 18 crore from the two blocks over the next 50 years.
Since then, 21 mines containing iron ore, limestone, gold and diamond etc have been auctioned.
Also read – COMMENT: Election results and stock markets; This too shall pass!
9:15 am Market Check:
Investors cheered the results of UP exit poll as the Sensex gained more than 100 points and the Nifty is eyeing 9000 level.
The 30-share BSE Sensex was up 127.50 points at 29,056.63 and the 50-share NSE Nifty rose 43.05 points to 8970.05. About 711 shares advanced against 190 declining shares on the BSE.
Adani Ports, Hero Motocorp, ICICI Bank, Larsen and Toubro, GAIL, Tech Mahindra, Kotak Mahindra Bank, Bank of Baroda and Tata Motors (DVR) were early gainers while ONGC was under pressure.
After the high-intensity battle for over two months, exit polls released on Thursday have predicted BJP cruising through in Uttar Pradesh; AAP in pole position in Punjab, but it has a wafer-thin lead over the Congress. BJP is seen snatching the rule from Congress in Uttarakhand. In Goa, BJP is likely to come up trumps with debutant AAP trailing behind. Congress is marginally ahead in Manipur and may win the state election for third time in a row
The Indian rupee opened marginally higher at 66.69 per dollar against previous close of 66.71.
Ashutosh Raina of HDFC Bank said, “In the run up to the March FOMC next week, the probability of Fed hiking rates has gone up substantially. While the rupee continues to gain on the back of sustained portfolio inflows, depreciation is likely as the dollar continues to gain.”
“We expect the USD-INR pair to trade in a range of 66.60-66.90/dollar today,” he added.
The dollar firmed to six-week highs against the yen and looked set for a modest weekly gain as investors awaited US job data later in the day that is expected to reinforce expectations of a Federal Reserve interest rate hike next week.
