DAILY NIFTY OUTLOOK, 21ST OCT, 2015

Nifty October futures (8259.45)(+58.65):
Nifty future has given an eight week high closing on the last day which is significant since bears have taken a back seat for now and it has closed above the major resistance zone of 8200-8220. 8243, 8220, 8200 is now the important and immediate supports. 8200, where the 200 day exponential moving average (ema) is posited will now act as the determining factor demarcating the long term and midterm uptrend. The levels of 8170, 8154 and 8137 are good supports but the critical support is the 8120-8095 zone and a decisive breach of this region will see the bears returning to the centres stage again, which, however, seems less likely immediately. On the higher side, Nifty futures now seem poised to test the 8398-8400 region with some strong hurdles around 8280, 8324 and 8350.

• Resistance: 8195-8200, 8220, 8247-8250, 8280, 8300, 8324, 8350, 8400-8405
• Support: 8170, 8154, 8137, 8100, 8085, 8020, 7995, 7960, 7897-7900, 7880, 7820, 7765

Bank Nifty October Futures (17983.35) (+251.75):

Bank nifty future has met the first expected target of 18000 and has closed above the 200 day ema posited in the 17740 confirming the long term uptrend. With such a strong close over the weekend, it may either consolidate the gains in the next session or continue with the upswing and target the 18400 region where the 200 day sma is posited with some resistance around 18010, 18137, 18200, 18300. Though 17860 is the immediate support below the psychological support of 17900, the 17740-17700 region is the current critical support zone and expected to hold on declines. A close below 17700 will, however, put the long term uptrend in jeopardy.

• Resistance: 17998-18010, 18109, 18137, 18200, 18295-18300, 18400, 18510, 18560
• Support: 17900, 17860, 17804, 17740, 17700, 17685, 17600, 17550, 17500-17495, 17440, 17356

DAILY MARKET OUTLOOK, 21ST OCT 2015

Dear Customer,

 

Markets always tend to be interesting with something or the other happening all the time. Our Morning Mantra is released before the opening bell and it includes the market commentary along with Corporate & Global news for the day.

 

• U.S. stocks closed lower Tuesday, with the Dow Jones industrial average snapping a three-day winning streak, as Wall Street digested a slew of corporate earnings reports and U.S. housing starts data.

Dow Jones	17217.1	-13.4	-0.08%
Dow Jones Fut	17129.0	+22.0	+0.13%
Nikkie	18335.2	+148.0	+0.81%
SGX Nifty	8255.0	-1.5	-0.02%

 

• Asian shares eked out cautious gains on Wednesday as concerns about corporate earnings hobbled Wall Street while investors counted down to the European Central Bank's policy meeting later in the week. Hongkong market is closed today
• Market is expected to open on a flattish note and likely to remain range bound during the day.
• Aksh Optifibre Limited has informed that Hon'ble High Court of Rajasthan has admitted a winding up petition against the Company, being Corporate Guarantor, for the alleged/disputed liability of its subsidiary.
• Financial Technologies has entered into an agreement with Madison India for sale of 1.58% stake in Indian Energy Exchange for Rs 33.96 crore.
• Standard & Poor's lowered Vedanta Ltd foreign currency long-term corporate credit rating on London-listed mining conglomerate Vedanta Resources PLC to 'B+' from 'BB-' with a negative outlook, citing weak financial performance expected in the next 12-18 months.
• Parsvnath Developers repays Rs 50 cr debt to Essel Finance, others
• RBI Says Foreign Shareholding Via FIIs/(RFPIs In Shriram Transport Crosses Threshold Ban Limit
• Welspun Corp Wins Order To Supply 90,000 mt Line Pipes In MENA Region

 

• Results announced

SKS Micro - Insti	SKS Microfinance (SKS) reported a good set of numbers for 2QFY16. Net interest income grew 50%, which was 12% above our estimate. Assets under management (AUM) rose 71% YoY and non-Andhra Pradesh AUM grew 80% YoY. Net interest margin or NIM stood at 12.0% against our estimate of 11.2%. NIM improved 20bps on sequential basis, but on YoY basis it fell 90bps on account of a higher base. Non-interest income grew 73%, driven by a 40% growth in loan processing fees and a 95% rise in other income. Operating expenses grew 25%, which was 5% below our estimate. Cost-to-AUM ratio improved to 7.6% from 10.0% a year ago. Operating profit grew 96%, which was 33% above our estimate. Gross non-performing assets or GNPAs, in line with our expectations, deteriorated slightly by 10bps QoQ to 0.2%. Collection efficiency was maintained at 99.7%. Credit costs (annualised) at 80bps were in line with our estimate. PAT grew 37% as SKS started paying minimum alternate tax or MAT. PAT was 31% above our estimate. The management revised its FY16 PAT guidance to Rs2.90bn from 2.35bn earlier. We have increased our AUM growth estimate for FY16 to 55% from 50% earlier. We have also increased our earnings estimates by 13%/9% for FY16/FY17, respectively. We have conservatively increased our GNPA estimates by 10bps each to 0.8%/1.2% for FY17/FY18, respectively. We have retained Buy rating on SKS, valuing the stock at a P/ABV of 4.0x with a target price of Rs650, up 44% from the current market price.
Sanofi India	Result is good Sales is Rs 552.8 cr vs exp of Rs 573.7 cr. QoQ Rs 514.3 cr YoY Rs 487.3 cr EBITDA is Rs 141.9 cr vs exp of Rs 125.1 cr. QoQ Rs 121.4 cr YoY Rs 103.9 cr PAT is Rs 72.5 cr vs exp of Rs 72.2 cr. QoQ Rs 64.2 cr YoY Rs 62 cr
Syngene International	Result is good Sales is Rs 256 vs QoQ Rs 228.3 cr YoY Rs 197.9 cr EBITDA is Rs 85.8 cr vs QoQ Rs 74.9 cr YoY Rs 63.5 cr PAT is Rs 52.3 cr vs QoQ Rs 48.6 cr YoY Rs 40 cr The stock is trading at 34x FY16E earnings
ACC	result ahead of Exp Sales came at 2740cr vs Exp 2761cr qoq 2961cr yoy 2741cr EBITDA came at 314cr vs Exp 256cr qoq 334cr yoy 379cr. current Qtry EBITDA is after Local Body tax of rs.37cr excluding that EBITDA is even higher at 315cr PAT came at 117cr vs exp 123cr qoq 131cr yoy 205cr
Hero Motocorp	result ahead of exp Sales came at 6745cr vs Exp 6677cr qoq 6856cr yoy 6864cr EBITDA came at 1083cr vs Exp 986cr qoq 1047cr yoy 935cr PAT came at 772cr vs Exp 716cr qoq 750cr yoy 763cr
Kajaria Ceramics	Result improved. Sales came at 211cr vs qoq 198 yoy 188cr EBITDA came at 21cr vs qoq 18cr yoy 16.5cr PAT came at 5.16cr vs qoq 3.21cr yoy 3.92cr. Qtr EPS is Rs. 4.75
Rane Madras	Result improved. Sales came at 211cr vs qoq 198 yoy 188cr EBITDA came at 21cr vs qoq 18cr yoy 16.5cr PAT came at 5.16cr vs qoq 3.21cr yoy 3.92cr. Qtr EPS is Rs. 4.75
GM Breweries	result continue to be good post good performance in Q1. Sales came at 94cr vs qoq 81cr yoy 75cr EBITDA came at 18.11cr vs qoq 21.37cr yoy  5.69cr Sep qtr EBITDA is after provision of Rs.6.7cr on account of LBT. PAT Came at 9.43cr vs qoq 15.89cr yoy 2.33cr
Hatsun Agro	Result is good Sales came at Rs 851.1 cr vs QoQ Rs 865.3 cr YoY Rs 744.2 cr EBITDA came at Rs 83.6 cr vs QoQ rs 78.9 cr YoY Rs 51.0 cr PAT is Rs 31.0 cr vs QoQ Rs 28.7 cr YoY Rs 10.3 cr
Adani Transmission	result good Sales came at 564cr vs qoq 468cr EBITDA came at Rs.528cr vs qoq 440cr PAT came at Rs.153cr vs qoq Rs.29.61cr Sep quarter included higher other income of rs.57cr vs qoq 1.27cr Qtr EPS is Rs.1.39 and Even adjusted to higher other income qtr EPS is Rs.1.05
Jyothy Labs	Result inline Sales came at 401cr vs Exp 402cr qoq 414 yoy 368cr EBITDA came at 49cr vs Exp 51cr qoq 57cr yoy 33cr PAT came at 39cr vs exp 37cr qoq 44.6cr yoy 25cr
AVT natural Product	result ok
DHFL	Result is in-line
Federal Bank	Result is below expectations
Mphasis	result  improved. Sales came at 1557.5  cr vs exp 1524.21 cr vs qoq  1496.41 cr vs yoy  1464.87 cr. EBITDA came at 234.5 cr vs 226.82 cr vs qoq 211.56 cr  vs yoy 214.52 cr. ADJ PAT came at 188.6  cr vs 179.78 vs qoq  168.9 cr vs yoy  160.20 cr .
Welspun India	Result is in-line
Bajaj Finance	Result ok. Operationally performance has come ahead of expectation but there is a higher increase in Loan loss provisions. NII came at 897cr vs qoq 894cr yoy 625cr PBP came at 565cr vs qoq 525cr yoy 379cr Provision came at 137cr vs qoq 103cr yoy 80cr PAT came at 279cr vs qoq 276cr yoy 197cr Share is trading at PE of 19 FY17 earning
Foseco India	result ok
Ortel Communication	result ok
Zensar Tech	result improved . Sales came at  756.43 cr vs qoq  704.64 cr vs yoy  647.66 cr. EBITDA came at  119.31 cr vs qoq 109.34 cr  vs yoy 99.52 cr. PAT came at  91.34 cr vs qoq 76.80 cr vs yoy  67.31 cr .
Can Fin Home	result improved
Bajaj Finserve	result ok
Container Corporation	result inline Sales came at 1501cr vs exp 1507cr qoq 1420cr yoy 1354cr EBITDA came at 316cr vs exp 316cr qoq 288cr yoy 313cr PAT came at 233cr vs Exp 233cr qoq 207cr yoy 192cr
IMFA	Result ok Sales came at 325.8cr vs qoq 322cr yoy 332.3cr EBITDA came at 56.4cr vs qoq 51cr yoy 60.2cr PAT came at 5.1cr vs qoq  loss of 11cr yoy .6cr.
BASF	Result is not good Sales came at Rs 1113.2 cr vs QoQ Rs 1345.9 cr YoY Rs 1205.9 cr Loss at EBITDA came at Rs 30.3 cr vs QoQ profit of rs 61.1 cr YoY profit of Rs 39.3 cr Net loss is Rs 58.7 cr vs QoQ Rs 92.7 cr YoY loss of Rs 20 cr
Biocon	Result is below expectations Sales is Rs 828 cr vs exp of Rs 849 cr. QoQ Rs 779 cr YoY Rs 750 cr EBITDA is Rs 189 cr vs exp of Rs 201 cr. QoQ Rs 212 cr YoY Rs 173 cr PAT is Rs 103 cr (adjusted exceptional) vs exp of Rs 113.5 cr. QoQ Rs 126 cr YoY Rs 102 cr The stock is trading at 20x FY16E earnings
Bayer Cropscience	Result is below expectations Sales is Rs 1150 cr vs exp of Rs 1337.7 cr. QoQ Rs 1371 cr YoY Rs 1215 cr EBITDA is Rs 214 cr vs exp of Rs 239 cr. QoQ Rs 142 cr YoY Rs 244 cr PAT is Rs 150 cr vs exp of Rs 177 cr. QoQ Rs 107 cr YoY Rs 176 cr
International Paper	result declining
Everest ind	Result declining. Sales came at 284cr yoy 243cr qoq 402cr EBITDA came at 4.28cr vs yoy 8.53cr qoq 38cr PAT came at negative 2.28cr vs yoy 3.37cr qoq 23cr. Being seasonal Business Q2 is generally weak quarter

 

• Results to be announced (PAT Rs cr)

21-Oct	Sept'14	June'15	Expectation	NB Insti
Akzo Nobel India Ltd.	35.8	45.3	43.7	#N/A
Bajaj Auto Ltd.	590.9	1014.8	904.8	886.2
Bajaj Holdings & Investment Ltd.	510.0	613.2	na	#N/A
Blue Dart Express Ltd.	30.8	45.6	52.4	#N/A
Cairn India Ltd.	2277.9	835.0	572.4	#N/A
Cosmo Films Ltd.	4.4	18.4	na	#N/A
Delta Corp Ltd.	-3.6	0.1	na	#N/A
HCL Infosystems Ltd.	-45.3	-41.5	na	#N/A
HDFC Bank Ltd.	2381.5	2695.7	2896.9	2861.8
Indiabulls Real Estate Ltd.	37.3	90.7	74.2	#N/A
Indiabulls Housing Finance Ltd.	448.2	511.3	554.8	#N/A
Indiabulls Ventures Ltd.	30.5	27.3	na	#N/A
Indiabulls Wholesale Services Ltd.	1.0	-16.0	na	#N/A
Idea Cellular Ltd.	755.9	930.8	829.0	#N/A
Intellect Design Arena Ltd.	0.0	-11.1	na	#N/A
IRB Infrastructure Developers Ltd.	121.7	165.9	143.3	#N/A
JSW Steel Ltd.	748.8	-106.8	-171.5	#N/A
KPIT Technologies Ltd.	70.6	44.4	45.9	#N/A
MMFS	219.4	107.4	207.5	#N/A
Mahindra CIE Automotive Ltd.	4.6	16.2	68.3	#N/A
Mangalam Drugs & Organics Ltd.	2.0	3.1	na	#N/A
NIIT Ltd.	5.3	-5.9	na	#N/A
Tata Coffee Ltd.	32.4	25.4	32.7	#N/A
Wipro Ltd.	2084.8	2187.7	2232.6	2213.9
Zydus Wellness Ltd.	27.3	19.5	29.6	#N/A
22-Oct
Cadila Healthcare Ltd.	278.1	353.4	357.7	366.5