Sensex, Nifty at 2-week closing low; HDFC, Asian Paints sink
19 Dec 2016
3:30 pm Market Closing: The market ended at 2-week closing low with the Sensex falling 114.86 points to 26374.70 and the Nifty down 35.10 points at 8104.35, weighed by HDFC, Sun Pharma, Asian Paints and L&T.
About 1565 shares declined against 1095 advancing shares on the BSE.
3:27 pm FII View: Ridham Desai of Morgan Stanley says he expects double-digit returns for the market in 2017 as he feels equities & local long bonds are trading almost at the same multiple.
He says currently stock valuations far more at attractive than in recent past. He believes India's long-term growth story is intact.
3:22 pm NBFCs bleed: Non-banking finance stocks - Bharat Financial, Manappuram Finance, Bajaj Finserv, Equitas Holding, M&M Financial and Shriram Transport were down 2-6 percent.
3:17 pm Nifty breaks 8100: Equity benchmarks extended losses in last hour of trade with the Nifty falling below the 8100 level, weighed by HDFC, Asian Paints, Sun Pharma, L&T and SBI.
The BSE Sensex was down 126.60 points at 26362.96 and the NSE Nifty declined 40.45 points to 8099.
About 1545 shares declined against 1087 advancing shares on the BSE.
3:02 pm Withdrawal limits to be relaxed soon: Santosh Kumar Gangwar, ministry of state for finance says ATM and bank withdrawal limits will be relaxed after December 30.
"We hope to normalise various measures taken under demonetisation post December 30," he says.
Issue of deposits in banking system should not be liked with today's RBI move and issue is people are depositing money repeatedly & not in one go.
2:53 pm Glenmark guidance: While addressing press conference, Glenn Saldanha, CMD of Glenmark says the company targets 30 percent of revenue from specialty & innovation segments going forward.
"We will file 9 new drug applications, bio licence application in next 10 years. Development efforts will be made in oncology, respiratory and derma segments," he says.
He expects to file 20-25 ANDAs & launch 20 generic products annually in US.
He also expects to file first NDA approval in respiratory within 3-5 years and to launch specialty business in US in 3-5 years.
"We will increase manufacturing footprint and increase number of manufacturing unit to 17 from 2," Saldanha says.
2:46 pm Defence contract: In a day or two, Ministry of Defence is likely to choose companies for designing and building protoypes for future infantry combat vehicles (FICV). The order size for the FICV prototypes contract is worth around Rs 60,000, reports CNBC-TV18.
One PSU - Ordnance Factories Board - and private players Bharat Forge, Mahindra & Mahindra, Tata Motors, L&T and Titagarh Wagons and Tata Power SED (jointly) are in the fray for the contract, according to people privy to the information.
Of the total applicants, three will be chosen to produce a prototype FICV.
2:35 pm Demerger: Nitin Alloys Global has taken on record the scheme of arrangement for demerger of the casting business of Nitin Castings into Nitin Alloys Global and made the scheme effective from December 15, 2016.
2:20 pm USFDA approval: Cipla has received final approval for its abbreviated new drug application (ANDA) for Fenofibrate tablets USP 48mg and 145mg, from the United States Food and Drug Administration (USFDA).
Fenofibrate tablets are AB-rated generic equivalents of AbbVie's Tricor tablets.
These tablets are indicated as adjunctive therapy to diet to reduce elevated low-density lipoproteincholesterol, total cholesterol, Triglycerides and apolipoprotein B, and to increase high-density lipoprotein cholesterol in adult patients with primary hypercholesterolemia or mixed dyslipidemia.
2:00 pm Market Check
The volatility continued in afternoon trade with the Nifty hovering around 8125 level. Tata Motors rebounded over half a percent while ICICI Bank and Reliance Industries continued to support the market.
The 30-share BSE Sensex was down 57.44 points at 26432.12 and the 50-share NSE Nifty fell 18.55 points to 8120.90. About 1403 shares declined against 1142 advancing shares on the BSE.
Europe's bourses were lower as markets entered the usually quiet week for volumes ahead of the holiday season.
Asian markets too were mostly lower with Hang Seng falling 0.85 percent. Australia's ASX 200 gained 0.5 percent after it appeared to dodge a possible downgrade for now of its treasured top sovereign rating.
Oil prices rose half a percent in anticipation of tighter crude supply going into 2017 following the decision by OPEC and other producers to cut output to prop up prices.
13:45 buzzing stock: Ramco System advanced more than 5 percent intraday Monday as Horizon Hospitality selects company's HCM offering to streamline its regional HR and payroll functions.
UAE-based food service operator Horizon Hospitality Holdings LLC will implement Ramco Systems' HCM offering integrated with Global Payroll, to streamline its regional HR and payroll functions.
Horizon Hospitality Holdings LLC represents brands including ABD El Wahab, Asia Asia, Vapiano, Lock Stock & Barrel and Que 43.
1:30 pm CLSA on J&K Bank: CLSA has upgraded Jammu & Kashmir Bank rating from sell to buy with a revised target of Rs 77 (against Rs 65 earlier) as it believes valuation is reasonable and bank's focus on sanitising its book (asset quality) is also encouraging. However, the brokerage house cut its earnings estimates for FY17-19 after September quarter earnings.
According to the research firm, bank's return on equity may stay low due to higher non-performing loans (NPL) and its focus on improving its coverage ratio.
During Q2FY17, J&K Bank reported a loss of Rs 602.4 crore as slippage remained high (9 percent of annualised loans) & annualised credit cost rose to 8 percent raising NPL coverage 700 basis points to 43 percent.
Slippage was led by its corporate book (mostly outside J&K state) leading to a 21 percent QoQ rise in gross NPLs to 11 percent of loans. Overall stressed loans are at 22 percent and its net NPL to net worth ratio is at 55 percent.
1:00 pm Market check
Equity benchmarks remained volatile with the Nifty hovering in a tight range of 8110-8130 due to muted volumes at FIIs desk.
The 30-share BSE Sensex fell 68.79 points to 26420.77 and the 50-share NSE Nifty declined 20.25 points to 8119.20.
Anil Ambani Group stocks were among top five midcap gainers. Reliance Power, Reliance Infrastructure and Reliance Capital gained 2-3 percent.
HDFC, Asian Paints, HDFC Bank, Sun Pharma, SBI, L&T and Infosys were down 0.4-1.7 percent while ICICI Bank, Reliance Industries, ITC, Tata Motors, Lupin and Cipla gained 0.4-0.8 percent. GAIL remained top gainer, up 2.4 percent.
Tree House Education was locked at 20 percent upper circuit after Zee Learn called off its proposed merger and threatened to take legal recourse to seek damages from the failed deal.
12:55 pm New rule for old currency deposit: The Reserve Bank of India says the deposit of old currency above Rs 5,000 can be made only once per account till December 30.
Credit of over Rs 5,000 will be afforded only after questioning by 2 officials, it says.
These restrictions are not applicable for deposits under taxation regime for Prime Ministery Garib Kalyan Yojana.
12:42 pm Buzzing: Tree House Education plunged as much as 20 percent to 52-week low of Rs 19.10 after Zee Learn called off its proposed merger and threatened to take legal recourse to seek damages from the failed deal.
In a regulatory filing on Friday, Zee Learn had said that "in the light of the recent inordinate developments at Tree House, it is withdrawing from the proposed merger process, which has been awaiting various court, shareholder and related statutory approvals".
12:25 pm State elections: Sources told CNBC-TV18 that elections for 5 states may be held between second week of February & March, 2017.
Uttar Pradesh, Punjab, Goa, Uttarakhand & Manipur will go for assembly elections in 2017.
Election Commission is likely to announce state poll dates any day after December 20.
12:00 pm Market Check
The NSE Nifty continued to struggle below 8150 level amid rangebound trade. Usually trading volumes in last two weeks of every year are always dull due to overseas investors' Christmas vacation.
The 30-share BSE Sensex was down 70.84 points at 26418.72 and the 50-share NSE Nifty declined 19.00 points to 8120.45.
ICICI Bank extended gains to 1 percent after recouping early losses followed by Reliance Industries. GAIL retained its top position in the buying list, up 2 percent.
Lupin shares rose over a percent after the pharma major launched antifungal drug Voriconazole in world's largest drug maket United States.
Infosys, HDFC, Larsen & Toubro, Asian Paints and TCS were top five contributors to Sensex's fall, down 0.7-1.2 percent.
Asia markets were a mixed bag as Australia gained after it appeared to dodge a possible downgrade for now of its treasured top sovereign rating and Japan fell despite better-than-expected trade data.
11:40 am Drug launch: Pharma Major Lupin has launched its Voriconazole tablets, 50 mg & 200 mg and Voriconazole oral suspension, 40 mg/mL in the US.
Voriconazole tablets and Voriconazole oral suspension are the AB rated generic equivalent of PF Prism C.V's Vfend tablets and Vfend oral suspension.
It is indicated for use in patients 12 years of age and older in the treatment of the fungal infections.
11:20 am Interview: Minda Industries, from the auto ancillary space, is one of the biggest gainers of 2016. It is rising over 70 percent.
Speaking to CNBC-TV18, Sudhir Jain, Group CFO of Minda Industries said that the company expect to maintain 20-25 percent bottomline growth over next two years.
He further said that the company is planning to consolidate the business under the group company.
Two-wheeler segment saw an impact due to demonetisation. However, impact of demonetisation will also be seen in December sales, he added.
11:00 am Market Check
Benchmark indices and broader markets remained under pressure amid volatility in morning trade. GAIL and Aurobindo Pharma were the biggest gainers, up more than 2 percent.
The 30-share BSE Sensex declined 61.10 points to 26428.46 and the 50-share NSE Nifty fell 17.95 points to 8121.50.
Sanjeev Prasad of Kotak Institutional Equities says valuations of the Nifty 50 Index are reasonable after the recent correction and valuations of 'value' stocks are inexpensive despite their strong performance in CY16.
Oil prices rose in anticipation of tighter crude supply going into 2017 following the decision by OPEC and other producers to cut output to prop up prices. Brent crude futures were trading at USD 55.59 per barrel, up 0.69 percent,
from their last close. US West Texas Intermediate crude oil futures were up 0.89 percent at USD 52.36 a barrel.
Gold edged up, extending its recovery from a 10-1/2-month low hit last week, as the US dollar slipped from a 14-year peak against a basket of currencies.
10:45 am CLSA on J&K Bank: CLSA has upgraded the stock to buy and raised target price to Rs 77 from Rs 65 earlier on a reasonable valuations but slashed earnings growth estimates.
It says recovery of the J&K state will be key for better operational efficiency and remains conversative on management's indication of growth from next year.
Bank's CASA franchise remains strong and contributed 45 percent of deposits (which grew by 17 percent YoY), it says, adding demonetisation could further boost profit.
10:31 am Interview: To promote its 'go cashless campaign', the government is leaving no stone unturned and is encouraging every means for people to adopt digitisation. In an effort to reduce the woes of the people and give them something to cheer about, HPCL is giving cashback and rewards on fuel purchases made by credit/debit cards.
Cashless purchase has doubled from what it used to be before the roll-out of demonetisation, said MK Surana, CMD of the company.
In conversation with CNBC-TV18, the company chief said that HPCL hopes to have similar growth in the third quarter as in the last quarter due to the spike in the offtake of the fuel during the cash chaos period.
He also said, with this hike the company will be to maintain the earlier second quarter marketing margins on both petrol and diesel, ranging from Rs 1.5- Rs 2.
10:20 am Expert: The year 2016 has seen markets wither one storm after the other and the indices have been resilient to an extent that Nifty hovered around the 8,000-mark. After Brexit, surgical strike across the Line of Control,
Donald Trump's election and demonetisation, to name a few, Indian markets will enter 2017 battered and bruised, Udayan Mukherjee said.
Markets are likely to see volatility in the month of January on account of a possible earnings hit and upcoming Union Budget, Mukherjee said. He, however, added that investors may have priced in two quarters of poor earnings.
Throwing light upon the sectors to play in, Mukherjee said the second half of 2017 will be a better time for infrastructure play. The government's role in the infrastructure has shrunk in the past few years and investors will bet their hopes on Budget for an infra push, he said.
10:00 am Market Check
Benchmark indices continued to trade lower in morning with the Sensex losing around 100 points, dragged by index heavyweights HDFC, Infosys, and HDFC Bank.
The 30-share BSE Sensex was down 90.19 points at 26399.37 and the 50-share NSE Nifty fell 22.55 points to 8116.90.
Shares of Laurus Labs, the Hyderabad-based healthcare company, started off day with premium of 14.5 percent at Rs 489.90 against issue price of Rs 428 on the National Stock Exchange. The stock touched a high of Rs 498 (up 16.35 percent over issue price) and low of Rs 475 (up 11 percent) in early trade.
HDFC and Infosys were leading contributors to Sensex's fall, down 0.8 percent each. Tata Motors, Asian Paints, Sun Pharma and Adani Ports declined over a percent.
GAIL was the biggest gainer, up nearly 3 percent followed by ICICI Bank, Reliance Industries, ITC and Lupin.
9:35 am UBS on Motherson Sumi: With maintaining buy rating on Motherson Sumi with a target price of Rs 356, UBS says it is a multi-year story and expects 24 percent EPS CAGR over FY16-19 period.
The brokerage house sees margin improvement at Samvardhana Motherson Peguform and expects international business growth to remain robust.
The company has a solid track record of generating value by turning around distressed assets. UBS says Samvardhana Motherson Reflectec continues to gain share in the US market and India business will grow faster than domestic car production.
So it expects Samvardhana Motherson Peguform's EBITDA margin to improve by about 200 basis points over FY16-19.
9:25 am Market Expert: Sanjeev Prasad of Kotak Institutional Equities says valuations of the Nifty 50 Index are reasonable at 15.5x FY18 EPS after the recent correction.
He also says valuations of 'value' stocks are inexpensive despite their strong performance in CY16.
He sees their (value stocks) earnings improving due to better fundamentals and lower interest rates and valuations benefiting from lower domestic yields.
However, valuations of the 'growth' stocks, especially consumption stocks, are still quite rich, Prasad feels.
9:15 am Market Check
Equity benchmarks opened flat with a negative bias on Monday due to lack of global as well as local cues. Banking & financials, healthcare and FMCG stocks were under pressure while metals stocks gained.
The 30-share BSE Sensex was down 36.83 points at 26452.73 and the 50-share NSE Nifty fell 13.45 points to 8126.
HDFC, Tata Motors, HDFC Bank, Axis Bank, Asian Paints, SBI and Sun Pharma fell 0.4-1 percent while Reliance Industries, Dr Reddy's Labs, Coal India and Bharti gained.
The Indian rupee has opened lower by 5 paise at 67.81 per dollar on Monday against Friday's closing value of 67.76 a dollar.
Pramit Brahmbhatt of Veracity feels constant FII outflow and strong dollar index will put pressure on the rupee.
According to him, the USD-INR pair is expected to trade in a range of 67.50-68/dollar for the day.
The dollar slipped below the 103 mark as profit-taking halts the momentum of the greenback's rally.
Asian markets were mixed with the Hang Seng falling 0.8 percent while Australia's ASX 200 rising 0.7 percent.
US stocks fell on Friday, weighed by a more than 4 percent drop in Oracle shares, while recently battered stocks in the real estate and utilities sectors posted the largest gains.