Tue Oct 03 2017
Rajesh Sharma (2003 articles)

Market Live: Sensex soars 200 pts, Nifty around 9850; SBI drags PSU Bank index

1:16 am Auto stocks in focus: Auto stocks except Maruti Suzuki traded sharply higher today, following good September sales data on festive demand.

Tata Motors share price rallied 6.7 percent intraday as its domestic passenger and commercial vehicle sales grew by 25 percent to 53,965 units while Bajaj Auto soared 3.2 percent to hit a fresh high of Rs 3,208.40 as it registered a 14 percent growth in September sales at 4.28 lakh units.

Maruti Suzuki fell over a percent on profit booking after it reported a 9.3 percent growth in September sales at 1.63 lakh units YoY, driven by compact cars (Ignis, Baleno etc) and utility vehicles (Vitara Brezza, Ertiga).

11:05 am Buzzing: Shares of MOIL gained 5.5 percent intraday on the back of revision of manganese ore and other products prices.

The company has fixed/revised prices of different grades of manganese ore and other products, effective from October 01, 2017.

The prices of various grade of manganese ore have been increased by 7.25 percent on the existing prices prevailing since July 01, 2017.

The price of electrolytic manganese dioxide (EMD) has been increased by 2.36 percent.

Meanwhile, the ferro manganese/ferro manganese slag and some identified grades of manganese ore continue to be sold on e-auction basis through MSTC.

11:00 am Market Check: Equity benchmarks remained higher in morning after nearly 3 percent fall seen in previous two weeks. The rally was driven by Reliance Industries, Tata Motors and ITC.

HDFC Bank recouped early losses to trade mildly higher.

The 30-share BSE Sensex was up 231.34 points at 31,515.06 and the 50-share NSE Nifty gained 65.10 points at 9,853.70.

About 1,481 shares advanced against 662 declining shares on the BSE.

10:55 am Weekly market outlook: Vinod Nair, Head Of Research at Geojit Financial Services said the tail winds enjoyed by domestic economy due to benign commodity prices and falling inflation has currently started to reverse.

He further said, “On the backdrop of lackluster domestic macros, likelihood of extension of GST disruption and continued impact on corporate earnings, the current domestic premium valuation will not sustain and we expect consolidation to continue in near term.”

RBI policy meet is the key event to watch out for next week and the expectation is that RBI will maintain status quo, Nair said.

10:50 am Tractor sales: Farm equipment manufacturer Escorts Agri Machinery (EAM) saw a rise of 34 percent in its tractor sales in September at 10,353 units.

The company sold 7,725 tractors in the corresponding month a year ago.

Domestic tractor sales stood at 10,144 units as against 7,664 units in September last year, up 32.4 percent, Escorts Ltd said in a BSE filing.

Exports also grew to 206 units from 61 tractor units sold in September last year.

10:45 am Jefferies on ONGC: While retaining a buy call on ONGC with a target price of Rs 200 per share, Jefferies said gradual rise in oil prices would underpin buy rating.

Gas prices should rise 10-15 percent in a year, the research house feels.

According to Jefferies, higher output may drive natural gas EBITDA by 39 percent over FY17-21.

10:40 am Change in GST slabs possible?: Finance Minister Arun Jaitley last week hinted that there is scope for lesser slabs under the Goods and Services Tax (GST) once there is revenue buoyancy.

“We have almost by the day, space and scope for improvement. We have space for improvement and need for improvement to reduce compliance burden as far as small taxpayers are concerned,” he said.

“We have space for improvement, eventually once we become revenue neutral, to think in terms of bigger reforms such as lesser slabs, but for that we have to become revenue neutral…,” he added.

Currently, GST has four slabs, with rates ranging from 0 to 28 percent.

10:33 am Manufacturing PMI: September saw a sustained expansion in the Indian manufacturing sector, supported by increases in both output and new orders. However, the rates of expansion eased slightly in both cases.

At 51.2 in September, the Nikkei India Manufacturing Purchasing Managers’ Index was unchanged from August. The reading was indicative of a modest improvement in manufacturing sector business conditions in September, and one that was below the long-run trend (54.1), Nikkei IHS Markit survey said.

10:26 am Expectations for RBI policy: Global brokerage house JP Morgan feels the RBI is likely to adopt “wait and watch” strategy due to increased macroeconomic and inflation uncertainty.

Markets are likely to focus on the tone and guidance of policy, and how RBI looks at the various moving parts, it said.

Edelweiss expects RBI to leave rates unchanged while maintaining a dovish bias. “We continue to expect another 25 basis points rate cut in FY18, although more may be warranted, it said.

10:18 am Auto sales: The country’s largest two-wheeler maker Hero MotoCorp has sold over a million units in the festive season so far, a senior company executive said.

The company has achieved the milestone with still around three weeks remaining in the current festive season.

“The customer response has been so massive that we have already crossed a million units in retail sales in the ongoing festival season, with a double-digit growth over the previous year,” the official told PTI.

10:10 am Adani’s Australia project faces risk: Adani group’s Abbot Point Coal Terminal in Australia faces the risk of becoming a stranded asset if its proposed Carmichael mine fails to get 1 billion Australian dollar (AUD) subsidy, according to a report by US- based institute IEEFA.

The Institute for Energy Economics and Financial Analysis (IEEFA), which conducts research and analyses on financial and economic issues related to energy and environment, has found that Adani’s Abbot Point Coal Terminal (AAPCT) is excessively leveraged and promises negative shareholders equity. The Abbot Point terminal, IEEFA said, also “runs the risk of becoming a stranded asset if Adani’s proposed Carmichael mine does not get the AUD 1 billion Australian taxpayer subsidy it seeks.”

The IEEFA further said the analysis finds more broadly that “Adani’s entire AUD 3.5 billion debt-funded investment in Australia is at grave risk.”

Currently operating at just over 50 percent capacity, the AAPCT needs the Carmichael mine to fill the gap created as its current take-or-pay contracts progressively expire.

10:00 am Listing: SBI Life Insurance Company has listed at Rs 735 per share on the National Stock Exchange, up 5 percent over issue price.

9:55 am DLF in focus: Singapore’s sovereign wealth fund GIC has approached fair trade regulator CCI seeking approval for its deal to acquire stakes in DLF rental arm for Rs 8,900 crore and form a joint venture with the realty firm.

GIC had in late August agreed to buy 33.34 percent stake in DLF’s rental arm DLF Cyber City Developers Ltd (DCCDL) for Rs 8,900 crore. GIC will buy shares in DCCDL from DLF promoters.

According to sources, GIC has approached the Competition Commission of India (CCI) to get approval for this deal.

The deal is expected to be approved by next month, they added.

9:50 am Pre-opening: SBI Life Insurance Company share price settled at Rs 735 in pre-opening trade, up 5 percent over issue price of Rs 700 on the National Stock Exchange.

9:45 am Market Check: Equity benchmarks came off opening high in morning trade due to selling in index heavyweights HDFC Bank and HDFC.

The 30-share BSE Sensex was up 181.76 points at 31465.48 and the 50-share NSE Nifty rose 61.50 points to 9,850.10.

The market breadth remained strong as about three shares advanced for every share falling on the BSE.

Reliance Industries gained 2 percent while Tata Motors surged 4.5 percent.

9:40 am Drug launch: Dr Reddy’s Laboratories has launched Sevelamer Carbonate tablets (generic version of Renvela) in the US market.

“This is the company’s eighth overall and fourth limited-competition launch this fiscal year,” Alok Sonig, Executive Vice President and Head of North America Generics business said.

For the last 12 months ending in July 2017, the drug had US sales of approximately USD 1.88 billion, according to IMS Health.

Sevelamer is used to lower high blood phosphorus (phosphate) levels in patients.

9:35 am SBI Life to debut: SBI Life Insurance Company, which recently completed its initial share sale offer, will make its stock market debut today.

The initial public offer (IPO) of Rs 8,400 crore was oversubscribed 3.58 times on September 20-22. The portion meant for qualified institutional buyers (QIBs) was oversubscribed 12.56 times while that of non- institutional investors received 70 per cent subscriptions and retail investors 85 per cent, data available with the NSE showed.

SBI Life is a joint venture between India’s largest lender State Bank of India (SBI) and BNP Paribas Cardif (BNPPC), the insurance holding company of France.

9:30 am Merger called off: The merger of Anil Ambani-owned telecom major Reliance Communications (RCom) with its peer Aircel has been called off and the former will hive off an alternate plan including monetising its spectrum bands and real estate assets.

In a meeting with Board of Directors, RCom reviewed the ongoing strategic transformation programme, and considered alternate plans for debt reduction.

The merger of mobile business of RCom and Aircel lapses with mutual consent Rcom and Aircel Limited (Aircel) had signed binding agreements in September 2016 for the merger of Rcom’s mobile businesses with Aircel, the company said in a filing to stock exchange.

It said, “Legal and regulatory uncertainties, and various interventions by vested interests, have caused inordinate delays in receipt of relevant approvals for the proposed transaction.

9:25 am Idea-Voda merger: Vodafone India and Idea Cellular merger deal is expected to be completed by March next year, as all regulatory approvals are likely to be obtained by that time, a source privy to the deal said.

“There are only two permissions left in the amalgamation scheme of the Idea and Vodafone. It should be completed by end of the current financial year,” an industry source, who did not wish to be named, told PTI.

Both the companies are before National Company Law Tribunal (NCLT) for seeking its nod after which they will need final approval from the Department of Telecom.

9:20 am Buzzing: Shares of PNC Infratech added nearly 12 percent intraday on the back of contract win worth Rs 2159 crore.

The company has declared the lowest bidder for the project of 145 km long six laning of Chakeri to Allahabad section of NH – 2 from in the state of Uttar Pradesh under NHDP Phase-V.

This is the fifth hybrid annuity project won by the company has having construction period of two and half years and operation period of 15 years, company said.

9:15 am Market Check: Equity benchmarks opened sharply higher, tracking positive global cues and strong auto sales data.

The 30-share BSE Sensex was up 301.40 points or 0.96 percent at 31,585.12 and the 50-share NSE Nifty gained 84 points or 0.86 percent at 9,872.60.

Tata Motors, Eicher Motors, Hero Motocorp, Dr Reddy’s Labs, Bank of Baroda and BPCL rallied 1-6 percent.

Nifty Midcap rallied 1 percent on strong breadth. About five shares advanced for every share falling on the NSE.

Jaiprakash Associates, Jaypee Infratech, Peninsula Land, PNC Infratech, L&T Finance, TVS Motor, VIP Industries, Havells and Manappuram Finance rallied 2-10 percent.

Reliance Communications plunged 6 percent and Tourism Finance fell nearly 3 percent.
Asia markets were mostly higher post US equities closing at record highs overnight.

Rajesh Sharma

Rajesh Sharma

Rajesh Sharma is Correspondent for Stock Market of South East Asia based in Mumbai. He has been covering Asian markets for more than 5 years.

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