May 31

Daily Market Commentary : 30th May 2016

The Indian equity market closed in the green extending its winning streak to fifth consecutive trading session. After opening with a positive bias, indices were stuck in a narrow trading range. The benchmarks lost its early momentum on account of selling pressure in the realty, health care and oil & gas stocks. However, gains in the metals, IT and auto stocks saw the benchmarks end with modest gains.. Nifty closed with a gain of 22 points at 8,179 while Sensex ended with a gain of 72 points at 26,726.

On the economy front, GDP numbers, purchasing managers’ index (PMI) data for services and manufacturing sectors will be announced during this week.

Asian markets finished broadly higher today with shares in Japan leading the region. The Nikkei 225 is up 1.39%, while Hong Kong’s Hang Seng is up 0.26% and China’s Shanghai Composite is up 0.05%. European markets are trading mixed today. The German DAX is higher by 0.31%, while the CAC 40 is even. The London markets are closed.

Mahindra & Mahindra slipped 0.6% to Rs.1327. The company reported a net profit of Rs.5837.30 mn for the quarter ended March 31, 2016 as compared to Rs.5505.60 mn for the quarter ended March 31, 2015.

Claris Life sciences hit 20% upper circuit after the company announced that it received EIR for its manufacturing facility located near Ahmadabad wherein US FDA concluded that the inspection stands closed.

Granules India jumped 6% after the company said that it received Establishment Inspection Report (EIR) from the United States Food & Drug Administration (USFDA) for its Jeedimetla plant for the inspection conducted at the facility in December 2015.

Dynamatic Technologies rallied 17% to Rs.2650 after the company reported over three-fold jump in consolidated net profit at Rs.19.22 crore for the quarter ended March 2016. The company had posted net profit of Rs.5.04 crore in a year ago quarter.

Muthoot Finance rallied 8.7% to Rs.233.The company posted a net profit of Rs. 2652.213 million for the quarter ended March 31, 2016 as compared to Rs. 1651.858 million for the quarter ended March 31, 2015.

Tech Mahindra gained 1.5% to Rs.544 on BSE. The company said its board has approved the proposal to acquire Target TOPCO Ltd, a UK-based entity.

BHEL dropped 5.8% to Rs.121. The company’s standalone revenue stood at Rs. 10,004.77 crore, down 21.5% yoy but up 87.86% qoq.

Tree House Education plunged 10% to Rs.71. The net profit stood at Rs.6.78 crore, while revenue from operations was at Rs.209.33 crore, for FY16.

Coal India zoomed 3.8% to Rs.292.The company posted a net profit of Rs. 42479.30 mn for the Quarter ended March 31, 2016 as compared to Rs. 42385.50 mn for the Quarter ended March 31, 2015.

Jubilant Food works tumbled 8% to Rs.1,024.The company posted a net profit of Rs. 294.663 million for the quarter ended March 31, 2016 as compared to Rs. 315.322 mn for the quarter ended March 31, 2015.

Punj Llyod dropped 5.3% to Rs. 20.50 on BSE. The company posted a net loss of Rs. 4679.90 million for the quarter ended March 31, 2016 as compared to net profit of Rs. 2685.30 million for the quarter ended March 31, 2015.

Aurionpro Solutions gained 3% to Rs.148 after the company secured an order from Nagpur Metro Rail Corporation.

USDINR trade today trading down 21 paise at 67.24 per US dollar.

Out of 1,824 stocks traded on the NSE, 739 declined and 774 advanced today..

Top 5 Nifty Gainers: Tata Motors (7.47%), NTPC (1.64%), HDFC (0.69%), Maruti Suzuki (0.63%) and Axis Bank. (0.59%).

Top 5 Nifty Losers: Sun Pharma (-4.09%), GAIL (-1.94%), Bharti Airtel (-1.75%), Infosys Ltd (-1.42%) and L&T (-1.07%)

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May 30

Daily Market Commentary : 27th May 2016

The Indian equity market once again closed in the green extending its winning streak to fourth straight session on Friday. The Nifty closed at highest level in 7 months registering its biggest weekly gain in nearly 3 months. Hopes of economic recovery, strength in rupee and prediction of above average monsoon lifted sentiments higher. Nifty closed with a gain of 87 points at 8,156 while Sensex ended with again of 287 points at 26,654.

On the global front, most of the Asian indices closed their day on a positive note. The Hong Kong’s Hang Seng ended higher by 0.88%, while Japan’s Nikkei 225 ended higher by 0.37%. The European indices also witnessed buying interest. The FTSE 100 is up 0.05%, France’s CAC 40 is up 0.06% and Germany’s DAX is up 0.9%. The rupee was trading at Rs 66.97 to the dollar at the time of writing.

SBI reported its results for the quarter ended March 2016. The net profits declined by 66% YoY to Rs 12.6 billion during the quarter. The decline was mainly because of higher provisioning on account of bad loans.

The gross non-performing assets (NPAs) increased to 6.5%, higher than 5.1% as reported in the preceding quarter. As an absolute number the gross NPAs increased by 35% to Rs 981.7 billion on a sequential basis.

Further, provisions increased by 65% to Rs 131.7 billion on a sequential basis. The provisions increased as the company set aside more money to provide for the bad loans. Net interest income (NII), the difference between the interest earned on loans and that spend on deposits, increased by 4% YoY to Rs 152.9 billion during the quarter.

SBI’s earnings have been hit in the March 2016 quarter on account of the clean-up exercise undertaken in line with RBI’s Asset Quality Review (AQR).

While the fallout of the same has resulted in higher provisions that have curtailed earnings, but it will also enable banks to quickly tide over the NPA crisis. A check on the asset quality will be the key things to watch out for going forward.

One shall note that the bank is going to merge its five associate banks, along with Bharatiya Mahila Bank, with itself. The bank recently announced that its board has given in-principle approval for the bank to discuss the possibility of acquiring its associate banks.

The stock of SBI closed higher by 9.4%.

Tata Steel recently reported its results for the fourth quarter ending March 31, 2016 (4QFY16). The company posted a year on year (YoY) decline of 12.4% in its consolidated revenues. Consolidated net loss of the company stood at Rs 33 billion as against Rs 57 billion in the corresponding quarter last year. Operating profits, however, remained strong. The company’s EBITDA (earnings before interest, tax, depreciation and amortization) came in at 23 billion, up by 44% on a YoY basis.

For the overall business, the company recorded steel deliveries of 6.94 million tonne (MT) during the quarter, down 1.6%.

Stock of Tata Steel closed the trading day up by 1.7%.

USDINR trade today trading up 16 paise at 67.01 per US dollar.

Out of 1,440 stocks traded on the NSE, 566 declined and 817 advanced today.

Top 5 Nifty Gainers: Coal India (4.34%), Tata Motors (1.95%), TCS (1.20%), Dr Reddys Lab (0.88%) and Axis Bank. (0.86%).

Top 5 Nifty Losers: BHEL (-2.89%), Lupin Ltd (-1.26%), ITC Ltd (-1.11%), ICICI Bank (-1.07%) and HDFC (-0.79%)

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May 27

Daily Market Commentary : 26th May 2016

Indian equity market once again sky rocketed extending its winning streak to third consecutive trading session. Sentiment got a fillip after index heavyweight L&T announced quarterly earning which was better than expected. The BSE Sensex opened above the psychologically 26,000 mark and went on to hit its highest level in almost 21 weeks. Sensex galloped approximately 1,100 points in last 2 trading session. Nifty closed with again of 135 points at 8,070 while Sensex ended with again of 486 points at 26,367.

Shares of Larsen & Toubro (L&T) surged more than 13% in today’s trade after the company reported 18.5% increase in consolidated net profit for the March quarter. Consolidated net profit in the three months ended March was up 18.5% YoY. Net sales rose 18.5% YoY.

About 54% of the total revenue in the quarter came from its infrastructure business (Subscription Required), in which revenue rose about 19% YoY. L&T garnered fresh orders worth Rs 1.3 trillion at the group level during the quarter, which constituted 62% of domestic and 32% of international orders. The consolidated order book of the group rose 7% to Rs 2.5 trillion for the year ended 31 March, with international orders constituting 28% of the total. Reportedly, the company is expecting 12-15% increase in revenues and a 15% growth in its order inflows for 2016-17. The company is looking at countries like Mozambique, Tunisia, Kenya, Uganda, Tanzania, Algeria, Botswana and Zimbabwe for its international business .

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Engineering stocks finished on a strong note with L&T and Bharat Bijlee leading the gains.

Moving on to news from mining sector. According to an article in The Economic Times, Coal India is in talks with power companies in Bangladesh to supply coal. This is the first time Coal India will be exporting the fossil fuel on a commercial basis.

Reportedly, Coal India subsidiaries, Bharat Coking Coal and North Eastern Coalfields, plan to supply coal to Bangladesh. It is likely to be transported to Haldia port in West Bengal from where it could be forwarded through sea route to ports in Bangladesh. Coal India could not afford to export coal till last year because the fossil fuel was in short supply. The scenario changed last year when the company managed to pull up production at a considerable pace. Surplus stocks at pit head and slow lifting by power companies have prompted the company to explore the international market.

Apart from local Bangladeshi companies Coal India has also initiated talks with NTPC’s joint venture in Bangladesh, the 1,320 mw Maitree Project at Rampal in Bagerhat district. The project is a 50:50 JV between NTPC and the Bangladesh Power Development Board. Coal India finished the trading on a flat note.

USDINR trade today trading up 16 paise at 67.17 per US dollar.

Out of 1,812 stocks traded on the NSE, 1046 declined and 503 advanced today.

Top 5 Nifty Gainers: Sun Pharma (4.13%), Lupin Ltd (2.58%), Adani Ports & Sez (2.22%), SBI (1.82%) and Reliance Ind. (1.59%).

Top 5 Nifty Losers: ITC Ltd (-1.26%), L&T (-0.66%), NTPC (-0.60%), Tata Motors (-0.44%) and Axis Bank (-0.13%)

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