Morning Notes   LKP Advisory

Morning Notes
LKP Advisory
20 Oct-2014
FII's & DII's in equity
Indices
17-Oct
16-Oct
% Chg.
Major Indices
17-Oct
16-Oct
% Chg.
S&P BSE SENSEX
26,109
25,999
0.42%
CAC 40 Index
4,033
3,919
2.92%
17-Oct
7,780
7,748
0.41%
DAX Index
8,850
8,583
3.12%
Dow Jones Industrial Av
S&P CNX NIFTY
S&P BSE MID CAP
S&P BSE SMALL CAP
9,272
9,244
0.31%
10,314
10,343
-0.28%
Rs.Crs
Buy
Sell
FII' Investments
3554
4984
2566
1829
Net
-1430
16,380
16,117
1.63%
DII's Investments
FTSE 100 Index
6,310
6,196
1.85%
FII's contribution to the total turnover
43%
737
Nasdaq Composite Inde
4,258
4,217
0.97%
DII's contribution to the total turnover
22%
BSE Sectoral Indices
FII's in Derivatives
S&P BSE BANKEX
18,240
17,803
2.46%
Major Asian Indices
17-Oct
16-Oct
% Chg.
S&P BSE CAPITAL GOODS
14,244
13,984
1.86%
Hang Seng
23,023
22,901
0.53%
S&P BSE CONSUMER DURA
9,281
9,116
1.81%
Nikkei 225
14,533
14,738
-1.40%
Net
1030
624
-159
-90
S&P BSE POWER
1,989
1,963
1.34%
KOSPI Index
1,901
1,919
-0.95%
OI
9986
69721
42654
2728
S&P BSE PSU
7,857
7,774
1.06%
SSE Composite Index (S
2,341
2,357
-0.65%
Chg.OI
13.6%
5.6%
1.6%
S&P BSE REALTY
1,430
1,416
0.96%
Taiwan Weighted
8,513
8,634
-1.40%
FIIs' contribution to the total Derivatives turnove
S&P BSE AUTO
17,019
16,901
0.70%
S&P BSE HEALTHCARE
13,467
13,379
0.66%
Commodities (MCX)
17-Oct
16-Oct
% Chg.
17-Oct
16-Oct
% Chg.
S&P BSE OIL & GAS
10,542
10,504
0.36%
Aluminium (31OCT2014
120
118
1.99%
USDINR 29-OCT-2014
61.59
62.02
-0.69%
7,308
7,297
0.15%
Copper (28NOV2014)
409
409
0.06%
EURINR 29-OCT-2014
78.94
79.04
-0.13%
10,852
10,837
0.14%
Crude (20OCT2014)
5,095
5,109
-0.27%
JPYINR 29-OCT-2014
57.77
58.72
-1.61%
S&P BSE FMCG
S&P BSE METAL
S&P BSE TECk
S&P BSE IT
17-Oct
Rs.Crs
Index Fut Index Opt
Futures (NSE)
Stock Fut Stock Opt
1%
19%
5,657
5,812
-2.67%
Gold (5DEC2014)
27,256
27,449
-0.70%
FTSE100 (21-Nov-2014
6249
6150
1.61%
10,131
10,553
-4.00%
Silver (5DEC2014)
38,399
38,872
-1.22%
S&P500 (21-Nov-2014
1879
1838
2.24%
Chg
% Chg
323
11
3.6
888
29
3.4
ICICIBANK
HDFCBANK
1508
48
3.3
M&M
1258
39
BHEL
226
Company
LTP
Chg
% Chg
2433
-245
-9.2
HCLTECH
1510
-146
-8.8
JINDALSTEL
147
-4
-2.6
3.2
HINDALCO
139
-4
-2.5
7
3.1
SSLT
234
-6
-2.3
Chg
% Chg
Company
LTP
Chg
% Chg
HCLTECH
1506
-150
-9.1
TCS
2445
-234
-8.7
7
4.6
217
9
4.1
UBL
661
25
3.9
SSLT
233
-7
-2.8
30
1
3.7
HINDALCO
140
-3
-2.2
CANBK
384
13
3.5
JINDALSTEL
148
-3
-2.2
Company
LTP
Chg
% Chg
Company
LTP
Chg
% Chg
42
6.1
42
6.0
Top Losers
733
739
BSE Midcap
NBCC
EMAMILTD
BSE 100
154
Top Losers
IDEA
CMC
1873
-315
-14.4
ATUL
1287
-149
-10.4
212
-14
-6.4
64
-4
-5.9
385
-23
-5.7
ANDHRABANK
72
4
5.9
EDELWEISS
48
3
5.6
KSK
ORIENTBANK
247
12
5.1
PIIND
Company
LTP
Chg
% Chg
INSECTICID
771
103
15.5
PFLINFOTC
501
42
9.2
SRSREAL
47
4
8.7
IVRCLINFRA
16
1
7.5
KDJHRL
43
3
7.4
RALLIS
Company
Top Losers
Top Gainers
BSE Midcap
BSE Smallcap
Top Gainers
LTP
TCS
UNIONBANK
JPASSOCIAT
Company
CNX Nifty
LTP
ZEEL
Top Losers
Company
BSE Smallcap
CNX Nifty
BSE 100
Top Gainers
Top Gainers
LTP
Chg
% Chg
ASTAR
1170
-210
-15.2
DICIND
420
-72
-14.7
RSSOFTWARE
649
-82
-11.2
34
-3.7
-9.9
1
-0.1
-9.0
SPICEMOBI
INDINFO
Domestic Market View Markets likely to see early Diwili with a good start
The Indian markets showed the signs of rally and had
ended with decent gains in last session. Today, the start of
the Diwali week is likely to see some fireworks with a good
gap-up opening. Traders will be getting a boost with ruling
party’s victory in two state assembly elections of
Maharashtra and Haryana, which will give Narendra Modi
government a tremendous morale boost to pursue
economic reforms. Meanwhile, according to IMF's latest
world economic outlook, India is poised to become a USD
two trillion economy this year, while its GDP size would
cross another milestone of USD three trillion after five years
in 2019.
There is another news that will be aiding the strength in the
markets with the government raising the price of gas from
domestic fields to $5.6 per unit, around 33% higher from
$4.2 at present. The new price would come into effect from
November 1 and would be revised every six months with a
view to ensuring “stability in the market.” However, the
same decision is likely to weigh negatively on the fertilizers
and power stocks. There will be some buzz in the telecom
sector, as an inter-ministerial panel of Telecom Commission
has said that the proposed telecom spectrum auction
should be completed by February 28 next year.
Domestic Market Overview
Benchmarks snap two days losing streak; Sensex recaptures 26,100 level
Snapping two days losing streak, Indian equity benchmarks ended the session with a gain of around half a
percent, amid a rebound in European shares. Domestic bourses witnessed volatility throughout the session
as key gauges entered into negative terrain after a flat-to-positive start as sell off by foreign institutional
investors (FIIs) was massive who offloaded Indian shares worth Rs 1,128 crore on October 16, 2014. But
recovery in second half of trade helped markets to their crucial 26,100 (Sensex) and 7,750 (Nifty) bastions.
Traders took some comfort from Reserve Bank of India’s (RBI) Governor Raghuram Rajan’s statement that
India is seeing a pick-up in economic growth although more could be done to support that on a sustainable
basis, while noting inflation was also easing. He has also said that a growth of 7 percent is possible in shortterm but major reforms will be needed to take it to higher levels. Further, expectations that the BJP would
form the government in Maharashtra, the country’s largest industrial State, also boosted investor sentiment.
The Indian rupee firmed up against the US dollar and was trading higher at Rs 61.48 compared to the
previous close of Rs 61.83 tracking gains in Asian currencies. Meanwhile, banking shares remained in
demand after the Wholesale Price Index (WPI)-based inflation declined to its lowest level in five years at
2.38% in September from 3.74% in the previous month. Power stocks too participated in the rally despite the
looming crisis within sector with over 60 per cent thermal power stations grappling with critical coal shortage.
On the flip side, selling was witnessed in software and technology counters, led by around 8% fall in TCS
after reporting lower-than-expected Q2 numbers. TCS reported around 6% drop in net profit at Rs 5,244
crore for the second quarter ended September 2014 compared with Rs 5,568 crore in the first quarter ended
June 2014. Meanwhile, HCL numbers too remained below street expectation, although its profit increased
32% year on year but was up by only 2.1% sequentially. Its revenues grew 1.9% sequentially to $1,433
million, lagging behind its larger rivals Infosys and TCS.
Global Market Overview
Asian markets ended mixed on Friday
Asian markets ended mixed on Friday, with Japanese stocks falling for a second day, as banks and
exporters retreated. China will set an economic growth target of about 7 percent for 2015, tolerating the
weakest expansion in a generation as leaders tackle debt risks and imbalances. The PBOC cut the interest
rate it pays lenders for 14-day repurchase agreements for the second time in a month. Next week’s data -including GDP, industrial production and investment -- will help show whether more easing is needed.
Foreign direct investment commitments in Indonesia rose at a slower pace in the first nine months of 2014
compared with a year earlier, highlighting sluggish investment growth in Southeast Asia’s largest economy.
Commitments in January-September were Rp 228.3 trillion ($18.7 billion), a 14.6 percent increase from the
same period of 2013.
US markets closed higher; Dow snaps 6-day losing streak
The US markets closed higher on Friday, with Dow snapping 6-day losing streak, as earnings beat
estimates, consumer confidence reached a seven-year high and investors speculated that central banks will
add more economic stimulus. On the economy front, consumer sentiment in October rose to a reading of
86.4 from 84.6 in September, marking the highest level since July 2007. The index was as high as 96.9 in
January 2007 and was as low as 55.8 in August 2011. The pace of home construction climbed last month on
a jump in apartment building. Construction started on new US homes rose 6.3% in September, with the
annual rate hitting 1.02 million, following a sizable August drop. Signaling a continuation of the market’s
rebound, the pace of total home-building starts was up 17.8% from the year-earlier period.
Dow Jones Industrial Average added 263.17 points or 1.63 percent to 16,380.41, Nasdaq was up by 41.05
points or 0.97 percent to 4,258.44, while S&P 500 ended higher by 24.00 points or 1.29 percent to 1,886.76.
LKP Advisory Index Futures
(OI in '000 Shares)
Future
Chg
Spot
Chg
Prem /
17-Oct
(%)
17-Oct
(%)
Disc
Total Open Interest
17-Oct
Chg (%)
NIFTY
7,817
0.50
7,780
0.41
37.4
17,159
9.0
CNXIT
10,786
-3.79
10,746
-3.84
39.4
48
13.1
BANKNIFTY
15,991
2.14
15,930
2.50
61.2
1,894
11.1
Increasing OI, Increasing Delivery Qty & Increasing Price in Stock Futures (Open Interest in '000 Shares)
Symbol
Total OI
17-Oct % Chg.
UNIONBANK
10,494
% Del.
Prev
% Del.
20%
16%
Del Qty Cash Market
17-Oct
1,068,130
8%
Increase
Del Qty
Spot
(Rs.)
Fut
(Rs.)
Spot
Chg (%.)
Fut
Chg (%.)
Prem /
Disc
426,347
218
217
4.2%
4.9%
-0.6
BHARTIARTL
8,357
5%
3,405,834
72%
61%
889,325
396
398
2.0%
2.3%
2.1
ZEEL
6,248
5%
1,817,344
33%
25%
1,578,375
322
322
3.3%
2.8%
-0.3
DRREDDY
1,181
4%
232,710
63%
69%
13,648
2919
2934
0.5%
0.5%
15.8
HDFCBANK
37,130
4%
1,812,987
61%
48%
1,102,861
885
892
3.1%
3.3%
6.5
FEDERALBNK
16,468
3%
2,427,719
28%
19%
805,404
136
137
3.3%
3.5%
0.9
IDFC
48,824
3%
2,495,217
42%
39%
511,834
140
139
2.0%
1.9%
-0.3
TATAPOWER
25,052
2%
2,970,367
53%
51%
725,332
85
85
1.4%
1.7%
0.5
KOTAKBANK
2,610
2%
808,475
70%
65%
186,557
1000
1005
0.9%
1.3%
5.2
MARUTI
1,908
1%
139,461
45%
38%
67,737
2941
2957
0.1%
0.6%
15.4
Increase in
Del Qty
Spot
(Rs.)
Fut
(Rs.)
Spot
Chg (%.)
Fut
Chg (%.)
Prem /
Disc
-8.8%
-8.6%
8.0
Increasing OI, Increasing Delivery Qty & Decreasing Price, (Open Interest in '000 Shares)
Symbol
TCS
Total OI
17-Oct % Chg.
5,283
% Del.
Prev
% Del.
Del Qty Cash Market
17-Oct
18%
2,877,694
52%
54%
1,759,179
2441
2449
HCLTECH
3,330
18%
2,710,947
59%
70%
1,771,338
1506
1508
-9.1%
-9.3%
2.4
GLENMARK
2,286
17%
752,055
74%
44%
552,925
710
715
-1.2%
-1.2%
4.5
859
10%
117,202
47%
44%
67,330
1211
1219
-1.2%
-1.1%
7.1
BATAINDIA
ADANIPORTS
10,668
8%
1,417,417
40%
34%
578,710
250
252
-1.0%
-0.9%
1.3
HINDALCO
31,458
7%
7,113,568
50%
49%
910,237
139
140
-2.1%
-2.1%
0.8
TATAMOTORS
20,587
7%
5,434,116
54%
44%
2,361,057
476
478
-1.7%
-1.4%
2.6
375
6%
173,743
70%
47%
124,707
1640
1640
-0.1%
0.1%
0.5
SSLT
20,060
6%
2,824,551
46%
42%
123,413
233
234
-2.7%
-2.6%
1.4
HEXAWARE
11,482
3%
1,061,911
33%
25%
589,215
171
172
-2.8%
-2.8%
0.9
JUSTDIAL
Open Interest Break-up
(Rs. in Cr.)
17-Oct
16-Oct
Change in OI
% Chg
INDEX FUTURES
16,569
15,005
1,565
10.43
INDEX OPTIONS
123,831
119,986
3,845
3.20
TOTAL INDEX
140,401
134,990
5,410
4.01
54,189
52,400
1,788
3.41
STOCK FUTURES
STOCK OPTIONS
19,429
18,896
534
2.82
TOTAL STOCKS
73,618
71,296
2,322
3.26
GRAND TOTAL
214,019
206,286
7,732
3.75
FII's
125,089
119,503
5586
4.67
88,930
86,784
2146
2.47
Others
LKP Advisory Corporate News
¾
Sharon Bio-Medicine’s recently expanded formulation plant area located at Selaqui, Uttarakhand has been inspected by UKMHRA. The
United Kingdom - Medicine & Health Care Product Regulatory Agency (UKMHRA) team has conducted the inspection for Good Manufacturing
Practices (GMP) for formulation plant area. The intimation from the authorities is expected to be received by November, 2014.
¾
OCL India has reportedly launched special cement ‘Konark DSP cement’ for concrete casting. The product would be available in West Bengal
at a premium over normal bags.
¾
Brigade Group will invest Rs 500 crore in Gujarat International Finance Tec-City (GIFT City), India’s first globally benchmarked International
Financial Services Centre (IFSC) over next few years. The allotment of Development Rights for 1.1 million square feet of Built Up Area (BUA)
has been made to the Group for development of Commercial, Residential, Retail Mall and Hotel projects in SEZ & Non-SEZ Area in GIFT City.
¾
BEML, a premier domestic manufacturer of Mining & Construction equipment, has opened a regional office at Bangalore adding to its 11
existing regional offices spread across the Country. The Bangalore Regional Office will augment the needs of its customers in providing total
solutions for Mining & Construction application under one- roof.
¾
Sagar Cements has received final approval for the acquisition of 100% equity stake in BMM Cements, which owns a cement plant of 1 million
tonne capacity per annum and a captive thermal power plant of 25 MW capacity in Gudipadu near Tadipatri Anantapur District in the state of
Andhra Pradesh. The board of directors at their meeting held on October 17, 2014 has approved for the same.
¾
Tata Power’s 100% subsidiary - Tata Power Solar (TPS), one of the pioneering solar manufacturers in the world, has launched its latest
product line in LED home lighting. With the extended Tata Solar Diva range of lanterns and table lamps (5L, 15L2 and 25L) as well as Tata
Solar Venus range of home lighting solutions (15L and 75L), consumers can now enjoy uninterrupted power supply at an affordable cost. This
latest improved and diverse range of solar products will be available this Diwali, at select markets.
¾
Repco Home Finance has received an approval from Reserve Bank of India (RBI) whereby the ceiling for foreign investment in the company
under the Portfolio Investment Scheme has been enhanced to 49%. The name of the company has been removed from the Ban ListFII/RFPIs.
¾
Orbit Exports has permanently closed down one of its factory situated at Plot No G-99, Additional MIDC, Jalgaon in state of Maharashtra with
effect from October 17, 2014. All the manufacturing activities and operations in the said factory have been permanently and irrevocably closed
down.
¾
Everest Industries has received an approval for setting up of a 72,000 MTPA Fibre Cement Boards Plant in UAE through its wholly owned
subsidiary company in Mauritius subject to grant of applicable approvals. The board of directors at their meeting held on October 17, 2014 has
approved for the same.
¾
Suzlon Group, the world’s fifth largest wind turbine maker, has bagged orders for a combined capacity of 150 MW. This combined capacity
includes orders from corporate houses such as Malpani Group, Rajasthan Gum Group, KRBL, Sterling Agro Group and an assortment of
SMEs (Small and Medium Enterprise). The 150 MW order received is a significant development since it demonstrates renewed customer
interest to harness wind energy post the reinstatement of Accelerated Depreciation (AD) policy by the Government of India. The projects are
scheduled for execution across eight states in India with high wind potential.
¾
National Buildings Construction Corporation (NBCC) has formed a wholly owned subsidiary company in the name and style of -- NBCC
Services -- to carry on the business of providing post construction maintenance services and to act as an execution and implementation
agency for undertaking Corporate Social Responsibilities projects & related activities.
¾
BASF India has decided to divest the textile chemicals business to Archroma. The move comes in the wake of its parent company BASF SE’s
decision to divest the global textile chemicals business to Archroma. This transaction is expected to close in the first quarter of 2015.
¾
Clariant Chemicals (India) has opened its first regional innovation centre (RIC) in India at its headquarters in Navi Mumbai. The new facility
will host about 100 technical employees in chemical research and application development.
LKP Advisory ¾
In a bid to add new products, Minda Industries has invested Rs 450 crore. Moreover, the company has entered into several new segments
like fuel cap, die-casting, battery, CNG/LPG kits. This is its strategy to increase content per vehicle to step up engagement with automakers.
¾
Future Lifestyle Fashions has acquired 60% stake in Elisir Lifestyle, a company engaged in business of manufacture, supply and distribution
of footwear and accessories in India.
¾
In a bid to trim debt of Rs 60,000 crore by disposing off assets, Jaiprakash Associates is reportedly in talks with Shree Cement to sell its 2.1
million tonne Bhilai Cement unit for Rs 1,800 crore. The negotiation with Shree Cement is at an advanced stage and the deal is likely to be
completed by October.
¾
Crompton Greaves is planning to demerge its consumer products business unit into a separate company. With this, the company has
opened the doors for foreign investors by raising the investment limit to 100 per cent of the paid-up equity share capital.
¾
Premier Synthetics has sold 100% equity holdings of Premier Equity. Pursuant to this sale, Premier Equity is no more a subsidiary company
of Premier Synthetics.
¾
Mahindra Lifespace Developers has acquired a land parcel in MMR region for residential development having as estimated potential of
around 0.33 million square feet of saleable area. It will be a joint development project under residential housing segment.
¾
CMC’s board has approved the amalgamation of CMC with Tata Consultancy Services (TCS) pursuant to and subject to the provisions of
sections 391 to 394 of the companies act, 1956.
¾
DQ Entertainment (DQE) is teaming up with Italian public broadcaster Rai Com, to co-produce a new animated series called ‘Pio The Chick’,
based on a successful online property. The principal terms of this deal have been agreed by both parties at the recently concluded MIPCOM
in Cannes and the final agreement is expected to be signed imminently.
¾
CHL’s subsidiary company - CHL International has commenced its operation of hotel under the brand ‘Sheraton’ Dushanbe at Dushanbe,
Tajikistan since September 06, 2014. The Hotel Sheraton Dushanbe stands as a land mark in the Capital city of Dushanbe, Tajikistan. The
city Dushanbe is ideally situated and has now become a focal point of many countries such as USA, France and India who are making a
substantial presence in Tajikistan.
¾
The Tata Motors Group global wholesales in September 2014, including Jaguar Land Rover, were 80,104 vehicles. Cumulative wholesales
for the fiscal were 461,996 vehicles. Global wholesales of all Tata Motors’ commercial vehicles and Tata Daewoo range in September 2014
were 34,918 units. Cumulative commercial vehicles wholesales for the fiscal were 184,196 units. Global wholesales of all passenger vehicles
in September 2014 were 45,186 units. Cumulative passenger vehicles wholesales for the fiscal were 277,800 units.
¾
Bharat Heavy Electricals (BHEL) has successfully commissioned a 600 MW thermal unit in state of Madhya Pradesh achieving yet another
landmark. The unit has been commissioned at Madhya Pradesh Power Generating Company’s 2x600 MW Shree Singaji Thermal Power
Project, located near Dongaliya village of Khandwa District of Madhya Pradesh.
¾
Essar Steel is planning to re-start pellet production at its cyclone-hit Visakhapatnam unit in two-three days, even as work is under way to
restore the plant. The company has an eight-million-tonne-per-annum (mtpa) pellet plant in Visakhapatnam and another of six-mtpa at Paradip
(Odisha), which were not affected in the recent cyclone. The iron ore required for the pellet plant is pumped through a slurry pipeline from the
eight-mtpa beneficiation plants at Bailadilla (Chhattisgarh) and 12-mtpa plant at Dabuna (Odisha), which have rich iron ore deposits.
¾
Tata Steel’s 100% indirect subsidiary - Tata Steel UK Holdings (TSUKH) has executed agreements for the refinancing of its bank debt
through term loan and revolving credit facilities of euro 3.05 billion. The debt was originally incurred in relation with the acquisition of Corus
Group plc in 2007. The new financing structure consists of a 5-year loan of euro 370 million, a 6 year revolving credit facility for working capital
purposes of 700 million pound and a 7-year loan of euro 1.8 billion, with more favourable terms and pricing relative to the earlier debt.
¾
Carborundum Universal has completed the acquisition of 49% equity stake of CRIL on October 16, 2014. With this acquisition, CRIL has
become a wholly owned subsidiary of Carborundum Universal. The company had earlier executed a letter of intent (LoI) on August 04, 2014,
with Cellaris, for the purchase of 6,725,250 equity shares representing the remaining 49% of the equity capital held by Cellaris in CRIL subject
to necessary approvals.
LKP Advisory ¾
Videocon Telecom, part of the diversified $4 billion Videocon Group, has added 1.07 lakh new mobile subscribers in September, 2014.
Following the addition, the company’s total subscriber count stood at 59.41 lakh with a market share of 0.79%.
¾
Mahanagar Telephone Nigam (MTNL), the state owned telecom firm which operates in Delhi and Mumbai, has added 14,223 mobile
subscribers in September, 2014. Following the addition, the company’s total subscriber count stood at 33.08 lakh with a market share of
0.44%.
¾
Idea Cellular, one of the biggest cellular carrier of the country, has added 17.25 lakh new mobile subscribers in September, 2014. Following
the addition, the company’s total subscriber count stood at 14.35 crore. The country’s third-largest operator has a market share of 18.99%.
¾
Bharti Airtel, a leading global telecommunications company with operations in 20 countries across Asia and Africa, has added 10.22 lakh
users in September, 2014. Following this, the company’s total customer base has increased to 21.15 crore with a market share of 27.98%.
Economy
¾
India makes pitch for Chinese investments in SEZs
After attracting Chinese investments to its industrial parks, India has now strongly pitched for China's participation in country’s Special
Economic Zones (SEZ). An Indian delegation comprising senior officials from Commerce Ministry and SEZ developers, is presently on China
tour to attend business meetings and visit a number of successful Chinese Special Economic Zone (SEZ) ventures to get feedback.
It is reported that that delegation discussed the SEZ framework in the country and specific opportunities in select economic zones. India has
asked Chinese companies to increase investment in country and take optimum advantage of ‘Make in India’ campaign, aimed at ensuring
investor-friendly environment for businessmen in the country.
The six-member delegation is first from India after Chinese President Xi Jinping visited India in September during which $20 billion
commitment was made by China to invest in industrial parks in Gujarat and Maharashtra.
During the period April 2000 to July 2014, China has invested only $411 million which is only 0.18 percent of India's total FDI received in the
reported period. To enhance the Chinese investments in the country, the government has given an in-principle approval to a memorandum of
understanding (MoU) allowing China to set up industrial parks in the country. The industrial parks are expected to include special economic
zones (SEZs) and manufacturing zones.
¾
Central bank, Govt working on new monetary policy framework: RBI Governor
The RBI Governor Raghuram Rajan has stated that the central bank and the government are in discussion to formulate a new monetary policy
framework. The Governor added that the new policy will be in line with international standards and help central bank to make its objectives
more expressive.
Under the new monetary policy framework, the central bank will pursue the retail inflation target decided by the government. Further,
Raghuram Rajan said that an institutional structure such as a financial resolution authority will be set up that will improve the functioning of the
financial sector. Such an authority would be helpful in cleaning up the system by closing down entities which are in trouble and resurrecting
promising ones. The Governor also clarified that there is no conflict between the RBI and government and both maintain a free, frank and
cordial relationship with each other.
It is reported that the internal work for the new monetary policy framework is in advanced stages and the government will have to take a final
decision on it in consultation with the central bank. According to new framework, a separate monetary policy committee will be set up which
will set the interest rate with a view to ensure that inflation remains within the targeted levels. The move to set a new monetary policy
framework came in after the recommendation of Urjit Patel Committee, which had suggested that the RBI should target to bring down retail
inflation to 8 percent by January 2015 and 6 percent by January 2016.
LKP Advisory ¾
Coal stocks at power plants decline to 25-year low at 7.2 MT: CEA
The Central Electricity Authority (CEA) has stated that Coal stocks at power plants hit a new low in 25 years as state-owned Coal India (CIL)
and its subsidiaries failed to meet their production targets. In its latest report, the CEA highlighted that total fuel stocks at 103 coal-based
stations have come down to 7.2 million tonnes (MT) compromising 6.58 million tonnes of indigenous coal and 706 tonnes of imported fuel.
The CEA has noted that Coal India’s production is not in line with the demand of the power sector and its subsidiaries Northern Coalfields
(NCL) and Central Coalfields etc are not producing coal as per their respective targets. Around 61 thermal power stations are grappling with
critical coal shortage with less than a week’s stock at their disposal. Among these, 36 stations are reeling under acute shortage with less than
four days of stockpiles at their disposal.
Coal shortage in the country has become a concern for Indian power sector as coal-fired plants account for 59% of India's installed electricity
capacity. Indian domestic coal demand is around 35 percent higher than domestic supply, resulting into a high deficit of which a huge part is
being met by costly imports from Indonesia, South Africa and Australia. Coal India (CIL) is the only producer of coal in the country and is
struggling to meet domestic coal requirements. CIL production fell 4.21 percent short of its production target to 462.53 million tonnes in FY14
amid concerns like shutdown of mining activities in Talcher Coalfields in Odisha. The government has set coal production target at 507 million
tonnes to Coal India (CIL) for FY15.
¾
Pranab Mukherjee makes strong pitch for India as investment destination
With an aim to enhance foreign direct investments (FDI) in the country, President Pranab Mukherjee wooed Finland investors and suggested
them to take optimum advantage of the 'Make in India' programme. Promising a business-friendly environment which is ‘predictable,
facilitatory and transparent’ the President has asserted that India is fourth most attractive destination for FDI during 2014-16 owing to easing
of restrictions, growth and investor friendly atmosphere promoted by the government.
Making a strong pitch for bringing in investments, Mukherjee said that India has emerged as one of the largest global economies and country’s
FDI policy widely seen to be amongst the most liberal in the emerging economies, allowing up to 100 percent FDI under the automatic route in
several of our sectors and activities. Regarding the safety to investors from global shocks, President stressed that resilience of our economy is
evident from the fact that the impact of the global financial crisis has been far less severe in India as compared to the other countries.
¾
RBI governor hopes the economy to grow by 5.5% this year
Reserve Bank of India (RBI) governor Raghuram Rajan has expressed hopes on the Indian growth story and has said that the country is
seeing a pick-up in economic growth and more can be done to support it on a sustainable basis. He said the government is focusing on
improving the framework of doing business and expressed that it should be easier for businesses to grow in terms of finance and regulations
among others.
Rajan further said that “we are expecting 5.5% this year; it may go up little more to 6% next year and hopefully sevens the year after.”
However he reiterated that major reforms will be needed to take the growth to higher levels and to sustain that, we have to think about how we
reform the system of fundamentals.
Denying any conflict with the government, he said that the government and the RBI enjoy a free, frank and cordial relationship. We discuss
many things and we find and do what is in the best interest of the country. He said that there is discussion going on right now on a couple of
things, the talks include setting objectives for the RBI and did not threaten the independence of the central bank and were instead issues
being worked out between the two sides.
Source: Reuters, Ace Equity & LKP Research
LKP Advisory Tech View
CNX NIFTY
TECHNICAL VIEW
Nifty has taken strong support at around 7700 level which is also where the 100 DMA is placed. Though Nifty bounced from lower levels it failed to
cross 7800 level which is its immediate resistance. However, the fact that almost all the major sectors as well as midcap and smallcap space
witnessed strength indicates that Nifty may continue its upside. If Nifty trades above 7800 level then it can test 7900 swiftly. Nifty will continue to
take support at 7700.
IMPORTANT LEVELS FOR THE DAY
Support
BSE
NSE
BANKNIFTY
S1
26,221
7715
15607
S2
26,449
7642
15324
R1
25,852
7833
16064
R2
25,624
7906
16347
Pivot
26,036
7,774
15,836
Resistance
.
LKP Advisory PIVOT POINTS
Scrip Name
CMP
RB2
RB1
PP
SB1
SB2
ACC
1407
1456
1425
1400
1374
1343
Scrip Name
CMP
RB2
RB1
PP
SB1
SB2
GAIL
448
465
457
449
442
433
ADANIENT
441
458
448
441
433
423
GLENMARK
710
738
723
712
700
685
ADANIPORTS
250
266
257
250
243
234
GMRINFRA
21
22
21
21
20
20
ADANIPOWER
43
44
43
42
42
41
GODREJIND
283
294
287
281
274
267
ALBK
103
109
105
102
99
96
GRASIM
3279
3363
3315
3275
3236
3188
AMBUJACEM
207
214
210
207
204
200
HAVELLS
268
278
271
266
260
253
HCLTECH
ANDHRABANK
72
77
74
71
68
65
1506
1664
1591
1532
1473
1400
APOLLOHOSP
1022
1068
1045
1028
1010
987
HDFC
997
1032
1011
994
977
956
APOLLOTYRE
207
216
211
207
202
197
HDFCBANK
885
920
896
877
858
834
ARVIND
273
285
278
272
266
259
HDIL
77
83
79
76
72
68
43
45
44
43
42
41
2874
3076
2946
2841
2736
2606
ASHOKLEY
HEROMOTOCO
ASIANPAINT
640
657
647
638
629
619
HEXAWARE
171
186
178
171
165
157
AUROPHARMA
913
965
935
911
886
856
HINDALCO
139
149
144
141
137
132
AXISBANK
402
415
407
400
394
386
HINDPETRO
492
515
503
494
485
473
2373
2447
2409
2378
2347
2309
HINDUNILVR
726
755
741
730
719
705
872
892
880
871
861
849
HINDZINC
159
163
161
159
157
154
BAJAJ-AUTO
BANKBARODA
BANKINDIA
257
271
262
255
249
240
IBREALEST
BATAINDIA
1211
1280
1248
1222
1196
1165
ICICIBANK
68
72
69
67
65
63
1505
1553
1521
1496
1470
1438
BHARATFORG
752
777
762
750
738
724
IDBI
62
64
63
61
60
59
BHARTIARTL
396
409
401
395
389
381
IDEA
154
164
157
152
147
141
BHEL
227
236
230
225
220
215
IDFC
140
145
141
139
136
132
BIOCON
468
490
476
464
452
437
IFCI
33
35
34
33
32
30
BPCL
667
689
677
667
657
646
IGL
412
430
421
413
405
396
CAIRN
276
281
278
276
273
271
INDIACEM
104
110
106
103
100
97
CANBK
384
407
392
380
368
353
INDUSINDBK
661
686
671
658
646
631
CENTURYTEX
512
542
523
507
491
472
INFY
3852
3989
3923
3871
3818
3752
CESC
671
721
698
679
660
637
IOB
59
61
60
58
57
56
CIPLA
596
626
606
591
575
555
IOC
366
382
373
365
357
348
COALINDIA
351
362
356
351
345
339
IRB
230
239
233
229
224
219
1696
1755
1728
1706
1684
1657
ITC
354
367
360
355
350
343
CROMPGREAV
191
209
198
189
181
170
JINDALSTEL
148
160
154
149
144
138
DABUR
206
212
209
207
204
201
JISLJALEQS
81
86
82
80
77
73
COLPAL
DISHTV
55
56
55
54
53
52
1705
1760
1734
1713
1692
1666
111
123
116
110
104
97
DRREDDY
2919
3056
2979
2918
2856
2779
EXIDEIND
165
176
170
166
162
FEDERALBNK
136
145
139
134
129
DIVISLAB
DLF
LKP Advisory JPASSOCIAT
30
31
30
30
29
28
JPPOWER
12
13
12
12
11
11
JSWENERGY
70
74
72
69
67
65
JSWSTEEL
1132
1212
1162
1122
1082
1032
156
JUBLFOOD
1196
1253
1221
1196
1170
1139
123
JUSTDIAL
1640
1689
1663
1642
1621
1595
PIVOT POINTS
Scrip Name
CMP
RB2
RB1
PP
SB1
SB2
Scrip Name
CMP
RB2
RB1
PP
SB1
SB2
KOTAKBANK
1000
1029
1010
995
980
961
TATACHEM
391
403
395
389
383
376
114
119
115
113
110
107
TATACOMM
366
378
371
366
360
354
65
68
66
65
64
62
TATAGLOBAL
153
157
155
153
151
148
333
350
339
330
320
309
TATAMOTORS
476
498
486
476
466
454
KTKBANK
L&TFH
LICHSGFIN
LT
1453
1496
1469
1447
1426
1399
TATAMTRDVR
310
334
318
305
292
276
LUPIN
1347
1398
1364
1336
1308
1273
TATAPOWER
85
88
86
84
83
80
M&M
1254
1310
1276
1248
1220
1186
TATASTEEL
448
470
457
446
435
422
M&MFIN
278
292
285
279
274
267
TCS
2441
2573
2511
2461
2411
2348
MARUTI
2941
3016
2971
2935
2898
2853
TECHM
2273
2494
2364
2259
2153
2023
MCDOWELL-N
2373
2496
2434
2384
2334
2272
TITAN
381
398
387
378
369
358
MCLEODRUSS
254
267
260
253
247
240
UBL
661
696
675
658
641
619
30323
31533
30932
30445
29959
29358
79
84
81
78
76
72
NHPC
19
20
19
19
19
19
2318
2403
2359
2323
2288
2243
NMDC
160
165
162
159
156
152
UNIONBANK
218
231
222
215
208
200
UNITECH
MRF
NTPC
141
144
142
140
139
137
OFSS
3180
3263
3218
3181
3144
3099
ONGC
397
408
401
396
391
ORIENTBANK
247
264
253
244
PETRONET
188
193
190
188
18
19
18
17
17
16
323
336
328
321
315
307
385
VOLTAS
230
244
235
227
220
211
235
224
WIPRO
566
599
582
569
556
540
185
182
YESBANK
598
615
604
594
585
574
ZEEL
322
347
334
322
311
298
251
269
257
248
238
226
PNB
920
939
930
923
915
906
POWERGRID
134
137
136
134
133
132
82
85
83
82
81
79
592
612
601
592
583
572
RANBAXY
RCOM
99
103
101
99
98
96
RECLTD
259
276
265
257
248
237
RELCAPITAL
452
473
459
447
435
421
RELIANCE
938
956
944
935
925
913
RELINFRA
554
582
566
553
540
524
RPOWER
69
71
70
69
69
67
SAIL
77
80
78
76
75
73
SBIN
2522
2593
2548
2511
2474
2428
SIEMENS
796
825
805
789
773
754
SRTRANSFIN
900
939
914
894
873
848
SSLT
233
245
239
234
229
224
SUNPHARMA
798
820
808
799
790
778
SUNTV
308
319
313
308
302
296
SYNDIBANK
114
121
117
113
109
105
LKP Advisory ULTRACEMCO
UPL
PFC
PTC
UCOBANK
The information in this documents has been printed on the basis of publicly available information, internal data and other reliable sources believed to be true and is for general guidance only. While every effort is made to ensure the accuracy and completeness of information contained, the company makes no guarantee and assumes no liability for any errors or omissions of the information. No one can use the information as the basis for any claim, demand or cause of action. LKP Securities Ltd., and affiliates, including the analyst who have issued this report, may, on the date of this report, and from time to time, have long or short positions in, and buy or sell the securities of the companies mentioned herein or engage in any other transaction involving such securities and earn brokerage or compensation or act as advisor or have other potential conflict of interest with respect to companies mentioned herein or inconsistent with any recommendation and related information and opinions. LKP Securities Ltd., and affiliates may seek to provide or have engaged in providing corporate finance, investment banking or other advisory services in a merger or specific transaction to the companies referred to in this report, as on the date of this report or in the past. LKP Securities Ltd. Ph: (91‐22) 66351234 FAX: (91‐22) 66351249 E Mail: lkpadvisory@lkpsec.com web: http://www.lkpsec.com LKP Advisory