27th May
2016

Exerting strength! Profit booking likely for indices

The market seemed to have celebrated two years of the Modi government in style clocking one of the biggest gains in recent times.  Prime Minister Narendra Modi has indicated that further economic reforms are on the cards. The rally was led by capital goods, industrial, banking, realty, IT, power and metal stocks. L&T, Infosys and ITC contributed almost 50% to the rally in Nifty. On the weather front, there is no change in forecast and June 7 is the date for monsoon to lash the country.
 
The outlook is a positive start. Some follow-up buying could be there in the initial hour as the June series gets underway. Results on tap today include SBI, BHEL, IOC, IOB, Oil India, BEML, Canara Bank, Crompton Greaves and  HPCL. The rupee could gain some strength.
 
US GDP numbers will be eyed by international investors.  Asian markets are mixed with Japan’s Nikkei half a percent up. South Korea’s Kospi has gained marginally while China’s Shanghai Composite is in the red.  US indices ended mostly lower.  Brent fell 15 cents to close at $49.59.
 
Global Rating Agency Fitch said, India’s economic growth rate will accelerate to 8% by fiscal year ending March 2019, driven by the gradual implementation of structural reforms.
 
Finance Minister Arun Jaitley has reportedly told Bharatiya Mazdoor Sangh that labour reforms are “not essential” for industrial growth and changes in these laws would be made only after taking unions on board, the RSS affiliated body said today.
 
Among other stocks in focus:
 
SBI: State Bank of India (SBI), the largest bank in India, will announce its financial results today. As per IIFL’s forecast, the bank’s net interest income for Q4 FY16 is expected to dip to Rs.14,221 crore, at a rate of 3% yoy; however, the same is likely to increase 5% qoq.      
 
BPCL: The company has posted a net profit of Rs.25490.80 million for the quarter ended March 31, 2016 as compared to Rs.28528.90 million for the quarter ended March 31, 2015.
 
Crompton Greaves: Crompton Greaves, one of the leading manufacturers of heavy electrical equipments in India, will announce its Q4 numbers today. As per IIFL’s forecast, the company’s net revenue for Q4 FY16 is expected to tank to Rs.2,274 crore, at a rate of 40.3% yoy; however, the same is likely to increase 10% qoq.
 
United Spirits Ltd: United Spirits posted a net loss of Rs.89.90 mn for the quarter ended March 31, 2016 as compared to Rs.17992.80 mn for the quarter ended March 31, 2015.
 
VA Tech Wabag Ltd: VA Tech Wabag Ltd posted a net profit of Rs.685.40 million for the quarter ended March 31, 2016 as compared to Rs. 705 million for the quarter ended March 31, 2015.
 
RPG Life Sciences Ltd: The company has decided to sell its biotech unit to Intas Pharmaceuticals Ltd for an unspecified amount, as per media reports.
 
Shipping Corporation of India Ltd: Shipping Corporation of India Ltd posted a net loss of Rs.70.20 million for the quarter ended March 31, 2016 as compared to net profit of Rs.1014.90 million for the quarter ended March 31, 2015.
 
Neyveli Lignite Corporation Ltd: Neyveli Lignite Corporation posted a net profit of Rs. 4462.40 million for the quarter ended March 31, 2016 as compared to Rs. 6768.10 million for the quarter ended March 31, 2015.
 
Apollo Hospitals Enterprise: The pharma company has launched its first standalone fertility centre in Chennai with a promise to offer quality infertility treatment backed by world class infrastructure and a team of experienced clinicians.
 
Adani Transmission: The company informed that the board of directors has approved the company’s fund raising plans of up to Rs.85 bn through a variety of instruments.
 
NIIT: NIIT has entered into two strategic agreements in China to develop a pool of next generation IT professionals in big data and analytics.
 
Results: State Bank Of India, Crompton Greaves, Bharat Heavy Electricals Ltd,DLF,Bharat Electronics Ltd, Beml,Indian Oil Corporation, Hindustan Petroleum Corporation Ltd, Bombay Dyeing,Canara Bank,Central Bank Of India,Karur Vysya Bank, Bajaj Healthcare,Dynamatic Technologies, Arss Infrastructure Projects,Eros International Media, 3i Infotech,3m India,Aadhaar Ventures India,Aadi Industries,Aashee Infotech, Allied Computers International, Adharshila Capital Services,Adf Foods,Advance Lifestyles,Advance Lifestyles,Alfa Transformers,Amarjothi Spinning Mills,Amines & Plasticizers, Ang Industries,Aplab,Aqua Pumps Infra Ventures,Aravali Securities & Finance,Rajdarshan Industries,Aroni Commercials,Aplab,Anjani Portland Cement,Ashnoor Textile Mills, Asian Hotels (North),ASIAN Tea & Exports,Atlanta,Autopal Industries,Available Finance,Avi Polymers,Axon Ventures,Axtel Industries,Birla Precision Technologies,Bisil Plast, B.L.Kashyap And Sons,Borax Morarji,B. P. Capital, Brawn Biotech, Bagadia Colourchem, B&A Packaging India, Bombay Burmah Trading Corp,Capital Trade, Brooks Laboratories,Bhilwara Technica Textiles,Cantabil Retail India,Captain Pipes,Caplin Point Laboratories,Carewell Industries, Carnation Industries, Chl, Captain Polyplast, Cravatex, Crestchem, Capital Trade Links, Cubical Financial Services, Lt Foods, Damodar Industries, Datamatics Global Services, Db (INTERNATIONAL) Stock Brokers, Dharamsi Morarji Chemical, Dhunseri Investments, Dil, Divine Multimedia, Dolat Investments, Dolphin Offshore Enterprises, Duropack,Dynavision, Easun Reyrolle, Easun Reyrolle, Ecoboard Industries, Ekam Leasing & Finance, Elgi Equipments, Emami Infrastructure, Emmessar Biotech & Nutrition, Enkei Wheels, Excel Industries, Extol Commercial, Facor Alloys, Farmax India, Filtra Consultants And Engineers, Ganga Pharmaceuticals, Gujarat Industries Power Co, Indoco Remedies, Kanoria Chemicals & Industries, Manaksia, Mmtc, Muthoot Finance, Pricol, Punjab Communications, Punj Lloyd, Pvr, Rpp Infra Projects, Sjvn,Suven Life Sciences, Tata Communications, Uflex, Thomas Cook, V2 Retail, Venky, Visa Steel, V.S.T.Tillers Tractors.
 
Global Data: Consumer Confidence (May) EUR , EUR Retail Sales (YoY) (Apr), CHF Employment Level (QoQ) (Q1), EUR Consumer Confidence (May), EUR Business Confidence (May), USD Gross Domestic Product Price Index (Q1)PRELIMINAR, USD Gross Domestic Product Annualized (Q1)PRELIMINAR, USD Personal Consumption Expenditures Prices (QoQ) (Q1)PRELIMINAR, USD Core Personal Consumption Expenditures (QoQ) (Q1)PRELIMINAR, USD Reuters/Michigan Consumer Sentiment Index (May), USD Baker Hughes US Oil Rig Count, USD Fed’s Yellen Speech SPEECH

Trends in FII flows: The FIIs were net buyers of Rs.5.89 bn in the cash segment on Thursday. The DIIs were net buyers of Rs.6.85 bn as per the provisional figures released by the NSE.
 

Other news in the media:
 
National Aluminium Company (Nalco) announced it would buy back 25% shares. The decision has been approved by the board of directors of the company. (BS)
 
Reliance Industries (RIL) and joint venture partner BP Plc are moving towards ending their dispute with the government on gas pricing, but are yet to officially approve the proposal for it. (ET)
 
Apollo Hospitals Enterprise has launched its first standalone fertility centre in Chennai with a promise to offer quality infertility treatment backed by world class infrastructure and a team of experienced clinicians. (BL)
 
Apollo Hospitals is planning to invest around Rs10bn over the next two years. The healthcare major said this investment will help the company to add around 1,500 beds and will take overall bed capacity to over 10,500. (BS)
 
Kwality to invest Rs5bn to increase focus on retail. (BS)
 
Strides Shasun has received tentative approval from the US health regulator for Efavirenz tablets used in treating human immunodeficiency virus (HIV) infection. (BS)
 
Coal India intends to export coal and is in talks with power companies in Bangladesh for striking supply deals. This is the first time Coal India will be exporting the fossil fuel on a commercial basis. (ET)
 
Adani Transmission informed that the board of directors has approved the company’s fund raising plans of up to Rs85bn through a variety of instruments. (BL)
 
GAIL India has reconfigured the Rs120bn Jagdishpur-Haldia pipeline, which will connect Varanasi to the gas grid, to link the Dhamra terminal. (ET)
 
NIIT has entered into two strategic agreements in China to develop a pool of next generation IT professionals in big data and analytics. (ET)
 
Fortis Healthcare is set to vertically demerge its diagnostic chain—SRL Diagnostics that will help the company getting listed on the Indian bourses. (ET) 
 
RPG Life Sciences has sold its biotech unit to Intas Pharmaceuticals. The company did not disclose deal size. (BS)
 
Snapdeal, Puravankara and property consultancy JLL India have announced the launch of a ‘Managed Residences Plan’ for their customers. (BS)
 
Biocon will invest Rs10.60bn to set up a manufacturing plant near Bengaluru. (BL)
 
Prime Minister has asked ministries of coal, railways, shipping and power to work out a plan for better movement of coal though coastal and inland waterways and present the policy on the same to the cabinet. (ET) 
 
India is on track to become one of the largest installers of solar power globally as its installed solar capacity has reached 6,000mw from 10mw in less than six years. (ET)
 
Reserve Bank of India Governor Raghuram Rajan said the central bank had been moderating extreme currency volatility through interventions. (BS)
 
National Pharmaceutical Pricing Authority (NPPA) has cut prices of 24 more essential medicines, including widely used antibiotics and an abortion pill, by up to 30% through its latest price fixation and revision order. (ET)

Source: India Infoline

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