Market Live: Sensex, Nifty trade lower after Fitch cuts FY18 India growth forecast

12:05 am Biocon creates new arm: Biopharmaceutical firm Biocon said it has created a new subsidiary to house all its biologic assets to enable the company to unlock value at a later date.

The biologics business consists biosimilars that include monoclonal antibodies and recombinant insulins and novel biologics.

“We have set up a new subsidiary Biocon Biologics, and all our biosimilar assets are consolidated under this legal entity, as we believe it will enable us to unlock value in the future,” said a Biocon spokesperson in an email interview.

The company declined to give further details on timeline for unlocking value, and whether it intends to list the subsidiary on bourses or plans to sell equity stakes to PE investors.

Here are the top headlines at 12 pm from Moneycontrol News’ Anchal Pathak

11:55 am Bonus Issue: Fiberweb India said the board of directors, on December 5, has recommended issue of bonus shares in the ratio of one bonus equity share for every one existing equity share and declared Interim dividend at 5 percent per share (i.e. 50 paise per share).

11:45 am Buzzing: Research firm Edelweiss looked bullish on dairy products manufacturer as it has initiated its coverage with buy rating on Parag Milk Foods and Heritage Foods, citing strong growth ahead. Stocks rallied more than 4 percent and 2 percent intraday, respectively today.

The brokerage house set a price target of Rs 340 for Parag Milk Foods, implying potential upside of 40.64 percent over Monday’s closing price.

For Heritage Foods, the brokerage house has set a target price of Rs 976 per share, implying a potential upside of 28.5 percent over Monday’s closing price.
11:31 am Contract Win: Ranhill Holdings Berhad announced that it has

signed a strategic deal with Ramco Systems to digitise its human resources operations covering 3,000+ employees across its 5 entities in Malaysia.
Ramco will implement its award winning human capital management (HCM) solution to harmonise a full spectrum of HR, payroll and employee

self services (ESS) functions into a single integrated system.

In addition to core HR components like recruitment, attendance and talent management, Ramco’s user friendly suite will also introduce advanced reporting and analytics capabilities into Ranhill Holdings and its subsidiaries.

11:16 am Market Check: Equity benchmarks remained under pressure in morning after the Fitch Ratings lowered India’s economic growth forecast for FY18. Investors also maintained their cautious stance ahead RBI policy meet and mid-term review of foreign trade policy.

The 30-share BSE Sensex was down 107.30 points at 32,762.42 and the 50-share NSE Nifty declined 31.70 points to 10,096.10.

About two shares declined for every share rising on the BSE.

News Live: Laurus Labs about to flood the US with cheap HIV drugs

11:05 am Project Execution: Tejas Networks has successfully completed execution of a high capacity national optical backbone network in Bangladesh for Bangladesh Submarine Cable Company, in partnership with Telephone Shilpa Sangstha.

10:55 am Debt Financing: Asian Development Bank (ADB) has approved debt financing and partial risk guarantees totaling USD 583 million to develop Reliance Power’s 750 MW LNG Based Combined Cycle Power plant and LNG Terminal Project in Bangladesh

10:45 am RBI Preview: The Reserve Bank of India (RBI) looks set to keep its policy rate on hold on Wednesday, after inflation accelerated to a seven-month high and stronger economic growth reduced the need for monetary stimulus.

All but two of 54 analysts in a Reuters Poll said the repo rate would be left at 6.00 percent, the lowest since November 2010.

In August, the RBI made its only cut in 2017, of 25 basis points, and in October, it held.

On Wednesday, after a two-day meeting, the RBI is likely to reiterate concern about inflation, as the annual rate increased to 3.58 percent in October. That’s low by Indian standards, but not far from the central bank’s 4 percent target.

Another source of RBI discomfort is that core inflation, which excludes food and energy prices, has remained stubbornly high at around 4.5 percent.

The central bank is likely to reiterate a “neutral” stance, thus giving itself flexibility to cut rates in February, even though only seven of the 48 analysts in the Reuters poll who gave a view on 2018’s first meeting expect that outcome.

10:35 am Services PMI: The Indian service sector dipped into contraction territory during November, following growth in the previous two months. This was matched by a reduction in new work. Panellists widely blamed the deterioration in business performance to the goods and service tax (GST). Meanwhile, cost pressures intensified during the latest survey period.

Posting below the no-change mark of 50.0 in November, the seasonally adjusted seasonally adjusted Business Activity Index signalled a contraction of the service sector for the first time in three months. That said, the rate of decline was modest.

With growth in manufacturing production offsetting the fall in services activity, private sector output rose for the third consecutive month in November. Reflecting a slowdown in output growth, the Nikkei Composite Output Index fell from 51.3 in October to a three-month low of 50.3 in November. This signalled a broad stagnation in private sector output in India.

10:15 am Order Win: Steel Strips Wheels announced bagging of another exports order for supply of steel wheels for European Union caravan market.

Order comprises of 18,500 newly developed steel wheel to be shipped from company’s Chennai plant from current month onwards, the company said.

10:05 am Buzzing: Bharat Forge shares gained more than 3 percent in morning after strong trend continued in North America class 8 truck orders in November.

North America class 8 truck orders for the November month were at 32,387 units, a massive growth of 68 percent over 19,285 units in year-ago.

The reason for strong leap in truck and tractor sales was US economic growth that has been topping 3 percent for last two quarters.

However, month-on-month basis, class 8 truck orders declined 9 percent from 35,700 units in October.

North American business contributes 40 percent to company’s total revenue.

Here are the top headlines at 10 am from Moneycontrol News’ Anchal Pathak

9:52 am Rupee Update: The rupee strengthened by 12 paise to 64.25 against the dollar at the interbank forex market today on increased selling of the American currency by banks and exporters.

The dollar losing sheen against some other currencies overseas also supported the local unit, traders said.

Yesterday, the rupee had rebounded by 9 paise to end at 64.37 against the US dollar in a highly volatile trade on fresh selling of the greenback and also emboldened by encouraging Q2 GDP numbers and monthly manufacturing data.

9:40 am Market Check: Benchmark indices extended losses in morning ahead of major events – RBI policy meet tomorrow, mid-term review of foreign trade policy due later today and Gujarat elections on Saturday.

Cut in economic growth forecast for FY18 to 6.7 percent (from 6.9 percent earlier) by Fitch Ratings also dampened sentiment.

The 30-share BSE Sensex was down 151.76 points at 32,717.96 and the 50-share NSE Nifty fell 42.90 points to 10,084.90.

More than two shares declined for every share rising on the BSE.

Bharat Forge shares gained 2.6 percent on strong trend North America class 8 truck orders.

9:33 am Pledged Shares: The value of shares pledged by the promoters of BSE-listed companies marginally dropped to Rs 2.78 lakh crore at the end of November, according to the exchange data.

The value of pledged shares stood at Rs 2.81 lakh crore at the end of October. It was at Rs 2.6 lakh crore in September.

Till November this year, pledging of shares was seen in as many as 3,005 out of 5,148 BSE-listed companies.

Share pledging is typically done by promoters to raise funds either for the same company or for financing other projects.

9:25 am IPO Opens: Ahmedabad-headquartered Shalby, the operator of chain of multi-specialty hospitals, has opened its initial public offering for subscription today, with a price band of Rs 245-248 per share.

The issue will close on December 7.

ALSO READ: Shalby garners Rs 150 crore from anchor investors

The public offer comprises a fresh issue of equity shares aggregating up to Rs 480 crore and an offer for sale of up to 10,00,000 equity shares by Dr Vikram Shah.

The offer comprises a reservation of up to 1,21,000 shares for subscription by eligible employees.

Bids can be made for a minimum lot of 60 equity shares and in multiples of 60 equity shares thereafter.

The fresh issue proceeds would be used for repayment certain loans (Rs 300 crore); purchase of medical equipments (Rs 63.58 crore); purchase of interiors, furniture, and allied infrastructure for upcoming hospitals (Rs 11.18 crore); and general corporate purposes.

9:20 am Economic Growth: Days after India’s economy showed signs of recovery, Fitch Ratings cut the country’s GDP growth forecast for the current fiscal to 6.7 percent from the earlier projected 6.9 percent, saying the rebound was weaker than expected.

It also cut GDP growth forecast for 2018-19 fiscal year to 7.3 percent from 7.4 percent predicted in its September Global Economic Outlook (GEO).

Fitch, however, expects GDP growth to pick up in the next two years on the back of gradual implementation of the structural reform agenda and higher real disposable income.

“The Indian economy picked up in Q317 (July-September), with GDP growing by 6.3 percent year-on-year, up from 5.7 percent in 2Q17.

“However, the rebound was weaker than we expected, and we have reduced our growth forecast for the fiscal year to end-March 2018 (FY18) to 6.7 percent from 6.9 percent in the September GEO,” Fitch said in its latest GEO.

9:15 am Market Check: Equity benchmarks opened mildly lower on Tuesday following tepid Asian cues. Investors remained cautious ahead of mid-term review of foreign trade policy due later today and RBI policy tomorrow.

The 30-share BSE Sensex was down 68.74 points at 32,800.98 and the 50-share NSE Nifty declined 19.30 points to 10,108.50.

Wipro, NTPC, IOC, Tech Mahindra, Power Grid, ONGC, L&T and HDFC Bank were early losers while Bosch, Bharti Airtel, HPCL, BPCL, Kotak Mahindra Bank, Tata Motors, M&M and Maruti Suzuki were gainers.

Nifty Midcap was down 0.2 percent.

Future Retail, Ashok Leyland, Reliance Communications and Jaiprakash Associates fell 1-5 percent.
Bharat Forge and Transformers and Rectifiers gained 2-4 percent.