Sensex, Nifty close flat ahead of exit polls; SBI, Maruti gain
09 Mar 2017
3:30 pm Market closing: Equity benchmarks closed flat after volatility, especially ahead of outcome of exit polls of assembly elections in five states due later today.
The 30-share BSE Sensex was up 27.19 points at 28929.13 and the 50-share NSE Nifty gained 2.70 points at 8927. The market breadth remained positive as about 1632 shares declined against 1176 advancing shares on the BSE.
SBI, Maruti Suzuki, Axis Bank, Tata Motors and Asian Paints gained 1-1.5 percent while Dr Reddy's Labs, Adani Ports, ONGC, Wipro, GAIL and Tata Steel fell 1-5 percent.
3:25 pm CAD: ICRA expects higher oil and gold imports to enlarge India's current account deficit to around USD 30 billion (1.2 percent of GDP) in FY2018 from around USD 20 billion in FY2017 (0.9 percent of GDP), arresting the trend of moderation recorded for four consecutive years since FY2014.
However, the pressure related to the financing of a larger current account deficit would abate with the resumption of NRI deposits in FY2018, it says.
3:15 pm Morgan Stanley on Vedanta: Morgan Stanley has initiated coverage with overweight on Vedanta, citing the company's potential to grow going forward.
The research firm feels that it is the fastest-growing aluminum and zinc company globally. ''The balance sheet risk has subsided, which has positioned VEDL on par with global miners and better than local peers,'' it said in a report.
Additionally, it forecasts a 30 percent free cash flow CAGR for FY17-19.
3:07 pm Market update: Benchmark indices recouped losses in last hour of trade, with the Sensex up 44.65 points at 28946.59 and the Nifty up 7.70 points at 8932.
Maruti, SBI, Tata Motors and Axis Bank were leading contributors to Sensex's gains.
3:03 pm Coal block auction case: Delhi HC has upheld cancellation of Jindal Power's bid for Gare Palma and Tara blocks.
The court says it cannot interfere with government decision to cancel Jindal Power's bid. Government should revisit idea of making Coal India a custodian, it adds.
The government had rejected winning bids by Jindal Power for 3 blocks.
2:57 pm Ruchi Soya to hedge: The Securities & Exchange Board of India's order has offered relief permitting all notices including company to trade in commodity derivatives markets for the limited purpose of hedging physical market positions under supervision of exchanges.
The company said it would resume pursuing its hedging strategy shortly fully complying with the relief offered in the order. The resumption of hedging by company will mitigate the impact of price fluctuations.
2:46 pm Management Speak: Rajinder Bhatia, President and CEO of the defence and aerospace vertical of Bharat Forge speaking exclusively to CNBC-TV18's Nithya Balakrishnan said that the company was targeting a volume growth of 100-200 percent in the defence space alone by 2020.
He said they are seeing large traction in the aerospace business and a lot of enquiries are coming in. He said they are now able to get into the supply chain of majors like Boeing, Rolls Royce and other original equipment manufacturers.
2:35 pm Make honest disclosures, I-T to blackmoney holders: The I-T department today nudged blackmoney holders to make "honest" disclosures under the tax amnesty scheme -- PMGKY -- warning that non-declaration could attract 77.25 percent tax and penalty along with prosecution.
In advertisements in leading dailies, the department said "like fingerprints, your blackmoney will lead us to you".
"Non-declaration of such undisclosed income will be liable to tax, surcharge and cess at 77.25 percent, along with penalty, prosecution and enforcement actions," the department warned.
2:26 pm FM to chair NPA meet: Finance Minister Arun Jaitley will chair a high-level meeting with Reserve Bank officials on March 10 to address the issue of non-performing assets in the banking sector.
The meeting, which will also be attended by Financial Services Secretary Anjuly Chib Duggal, will discuss ways of resolution of stressed assets urgently, sources said.
2:10 pm Market Check: Equity benchmarks continued their cautious trade ahead of the assembly elections' exit polls, with the Sensex and Nifty trading almost flat.
The Sensex was down 15.3 points at 28886.57, while the Nifty was down 7.6 points at 8916.65. The market breadth indicated a negative territory with 1,239 shares having advanced, 1,417 shares having declined and 161 shares were unchanged.
Dr Reddy's Labs continued falling the most, followed by Adani Ports and GAIL, while Maruti Suzuki and Tata Motors were the top gainers.
Shares of Mangalore Refinery and Petrochemicals (MRPL) jumped over 4.55 percent intraday on reports that the company may sell shares to comply with shareholding norms. A report in Mint states, the company has just 11.42 percent shares with the public. The rest is owned by ONGC and HPCL.
1:55 pm ICEX to resume operations soon: Indian Commodity Exchange (ICEX) today said it expects to restart operations by the end of this month after meeting the Rs 100 crore networth requirement post rights issue.
The exchange, where trading has been suspended for nearly three years, said it has completed its rights issue.
With this, ICEX now meets all Sebi norms, including the prescribed Rs 100 crore net worth criteria prescribed for commencement of trading operations, it said.
ICEX plans to resume operations by the end of March 2017, subject to regulatory approvals.
1:48 pm Buzzing: GAIL (India) shares plunged nearly 5 percent intraday after the stock adjusted for bonus issue announced in January.
The state-owned gas transmission company, on January 27, had approved issuance of one bonus share for every three shares held of Rs 10 each fully paid up. Consequently, the paid-up share capital of the company will increase from Rs 1,268.48 to Rs 1,691.30 crore.
GAIL has fixed record date as March 11 for allotment of bonus shares.
1:38 pm Europe opening: Markets in Europe opened lower as investors reacted to a plunge in oil prices and looked ahead to a rate decision from the European Central Bank.
After solid US jobs figures released Wednesday, expectations of a rate hike by the US Federal Reserve next week have become even stronger.
1:34 pm New contract: IT company Cyient has been selected by Liberty Global, the world's largest international cable TV and broadband company, to support its new GIGAWorld initiative to bring Gigabit broadband speeds to its operations in Europe.
1:22 pm PM on GST: As the Budget session of Parliament resumed today, Prime Minister Narendra Modi hoped there will be a breakthrough on the Goods and Services Tax (GST) bill and that issues will be discussed in a democratic manner.
"We hope that there will be a breakthrough on the GST because all states have positively cooperated. All political parties have also extended cooperation in a positive way," he told reporters outside Parliament.
The second leg of the Budget session resumed today after about a month-long recess.
1:14 pm PSU listing process: The central government is likely to write to the market regulator Securities and Exchange Board of India (SEBI) for accelerating equity offer documents. This will help the regulator meet its aim of timely listing of the public sector undertakings (PSUs), reports Business Standard.
The government, in its Budget, had announced that it will quicken the process of PSU listing. The center had also said that PSUs, which have been making profits for three years in a row, should be listed.
The regulator usually take 60 days to clear IPOs. The government wants the initial public offering to be cleared within a month's time. A document by the department of investment and public asset management (Dipam) mention 30 days window for SEBI approval.
1:00 pm Market check: The market continued to be lacklustre in afternoon as all eyes are on exit polls later today, which gives some indication about elections results. Actual results of assembly elections of five states will be announced on March 11.
Bharat Iyer of JPMorgan says he expects the market's reaction to the results to be asymmetric. A win for the BJP should result in a positive reaction but a weak showing will likely result in a more adverse reaction, Iyer feels.
The 30-share BSE Sensex was down 15.05 points at 28886.89 and the 50-share NSE Nifty fell 9.70 points to 8914.60.
Tata Motors, Maruti Suzuki, Asian Paints and Axis Bank were top gainers among Sensex stocks, up more than 1 percent whereas Dr Reddy's Labs retained its top position in selling list of Sensex stocks, down over 4 percent on 13 observations from USFDA for Duvvada facility.
12:55 pm GST rates unlikely before April: The rates under the Goods and Services Tax (GST) regime are unlikely to be out before April-end as the government wants to avoid any tax evasion attempt by companies.
India's corporate entities will be tracking the developments in the Budget Session, which resumed on Thursday, as the GST Bill will be taken up in Parliament for passage before it can be implemented from July 1. Read the full story here .
12:36 pm Management Speak: Dilip Buildcon targets a revenue of Rs 5,500-6,000 crore in FY18 and Rs 5,000 crore in this financial year says Rohan Suryavanshi, head-strategy and planning of Dilip Buildcon.
The company has won orders of Rs 8,000 crore plus this year, which include Rs 3,000 crore in mining and expect a revenue of Rs 700-800 crore from mining project in next 3-4 years.
Speaking to CNBC-TV18, Suryavanshi said the company has completed a toll project in Madhya Pradesh 400 days ahead of scheduled completion and will get an early completion bonus of Rs 15.4 crore which it will get in the next few months. He adds that the company will get Rs 15 crore every year in the form of annuity and right to collect toll from the MP project.
12:23 pm Buzzing Stock: Shares of Petronet LNG, the state-owned liquefied natural gas importer, fell more than 1 percent intraday Thursday following announcement of stake sale by GDF International.
"GDF International, who is holding 10 percent equity share capital in the company, proposed to divest its entire shareholding in the company," the company says in its BSE filing.
GDF, which distributes and markets liquefied natural gas, informed about its divestment to each of the promoter stating that it proposed to offer to each of the promoter a first right of purchase/refusal in relation to the proposed stake sale in the same proportion in which the promoter are holding equity shares in the company.
12:10 PM Market Update: The market was trading flat after entering the green zone for a brief period as investors are keenly eyeing exit polls.
The 30-share Sensex was down 16 points at 28886.16, while the Nifty was down by 10 points at 8914.25. The market breadth was in the negative territory with 1,172 shares having advanced, 1,271 shares having declined and 140 shares remaining unchanged.
Dr Reddy's, GAIL and Idea Cellular were the top losers, while Maruti Suzuki and Axis Bank were the top gainers on both the indices.
Tracking a weak trend overseas, gold prices declined by 0.36 percent to Rs 28,598 per 10 grams as participants trimmed positions. At the Multi Commodity Exchange, gold for delivery in far-month June shed Rs 104, or 0.36 percent, to Rs 28,598 per 10 grams, in a business turnover of 31 lots. In a similar fashion, the metal for delivery in April fell by Rs 99, or 0.35 percent to Rs 28,530 per 10 grams in 1,042 lots.
11:55 am Inflation: Indian inflation likely picked up for the first time in seven months in February as rising food prices began to bite, but it remained below the central bank's medium-term target, a Reuters poll found.
Prime Minister Narendra Modi's ban on high-value bank notes in November hurt demand in the largely cash-driven economy and consumer price inflation has since been below the Reserve Bank of India's 4 percent target.
According to the poll of over 25 economists, the inflation rate for February rose to a three-month high of 3.58 percent from 3.17 percent in January.
"The food component is largely seen responsible for the expected upswing in inflation trajectory, with core inflation also likely to pick up pace faster than what it has been in the last couple of months," said Anjali Verma, chief economist at PhillipCapital India.
11:37 am Merger: Macquarie believes Bharat Financial Inclusion merger, if it happens, will be yet another instance of IndusInd Bank (IIB) buying a niche growth portfolio after it acquired Deutsche Bank's credit card portfolio in 2011 and RBS' diamond financing book in 2015.
It also believes acquisition enhances the return on assets (RoA) profile of the bank and thus is a medium-term positive if executed well. However, this time, given the size of the book and signs of stress in the micro finance institution segment, execution remains key, the brokerage house says.
11:25 am Budget session resumes: The second part of the Budget Session of parliament began today.
In the run-up to the second part of the Budget Session, the passage of legislations related to Goods and Services Tax (GST) has been expected. The session will continue till April 12. The Finance Bill is also expected to be passed during the month-long session.
Meanwhile in the Lok Sabha, Maternity Benefit (Amendment) Bill, 2016 and The Admiralty (Jurisdiction and Settlement of Maritime Claims), 2016 are slated for consideration and passage today.
11:15 am Drug launch: Drug firm Lupin today announced the launch of pain relief drug Hydrocodone Bitartrate and Acetaminophen in the US market.
In a BSE filing, Lupin announced "the launch of Hydrocodone Bitartrate and Acetaminophen tablets USP, in the strengths of 5 mg/300 mg, 7.5 mg/300 mg and 10 mg/300 mg having received an approval from the United States Food and Drug Administration (USFDA) earlier."
In November last year, Lupin said it had received final approval from the US health regulator for its Hydrocodone Bitartrate and Acetaminophen tablets used for providing pain relief.
The company's product is a generic equivalent of Mikart Inc's Hydrocodone Bitartrate and Acetaminophen tablets.
11:00 am Market Check: Equity benchmarks remained sluggish in morning trade as investors eagarly awaited exit polls for assembly elections that ended yesterday. All eyes are on results of Uttar Pradesh that gives parliament most number of representatives.
The 30-share BSE Sensex was down 21.30 points at 28,880.64 and the 50-share NSE Nifty fell 8.55 points to 8915.75.
Dr Reddy's Labs fell 4 percent after the US Food & Drug Administration has issued Form 483 with 13 observations for Duvvada facility.
GAIL, Idea Cellular, Adani Ports, Bharti Infratel, Wipro and ONGC were other losers whereas Maruti Suzuki, Asian Paints, Axis Bank, SBI, Tata Motors and ACC were gainers.
10:56 am Kishore Biyani Interview: Future Group will become debt free in less than 4-5 years and has completed the reorganisation of businesses and is working towards strengthening the balance sheet to grow faster.
The group is looking to return investors 20 percent return on capital every year, says Kishore Biyani, CEO of Future Group. Speaking to CNBC-TV18, Biyani said that he expects an 80 percent growth in Future Consumers which has built multiple products and brands having its own distribution system that is coming on stream this year.
The company has launched new brands and started many factories which are operating at full capacity. Future Consumer to see revenue crossing to Rs 20,000 crore by 2020-2021.
10:45 am Aviation stocks take off: Aviation stocks on Thursday, riding on the developments of cut in jet fuel tax as well as fall in crude prices. Jet Airways rose 1.66 percent intraday, while SpiceJet rose 6.2 percent intraday on Thursday. Meanwhile, InterGlobe Aviation, the company that operates IndiGo, was trading flat with a slightly negative bias.
10:39 am FII view: Sanjay Mookim of Bank of America Merrill Lynch says while the GST (goods & services tax) should be beneficial in the long term, it will likely disrupt the economy during the transition period.
At a 17x 12-month forward P/E, Sensex valuations are nearly 15 percent above the long-term average and are likely ignoring this disruption, it feels.
Coupled with the residual impact of demonetisation, Sensex consensus earnings are likely to be cut by 6-8 percent over FY18-19, Sanjay Mookim says.
10:29 am Market check: The market is now in the green, with the Sensex up 16 points at 28917.92, while the Nifty is up 2.1 points at 8926.40.
10:20 am Expert Speak: While the global scenario is looking up, certain hurdles like the upcoming elections in France in next 2-3 months will be in focus.
The upcoming rate hike by the US Federal Reserve next week is already factored in, said Andrew Holland, Chief Executive Officer at Avendus Capital Alternate Strategies. Rather, eyes are on what Mario Draghi will do in the next ECB meet. The US dollar, which has not done much in past few weeks, will continue to rise in the first half on this year.
In the second half, other currencies like yen will be more in focus. No big move on currencies is expected this year.
10:00 am Market check: The market continued to be cautious ahead of key exit poll data for assembly elections in five states that will be announced later in the day.
The Sensex was down 4.55 points at 28897.39, while the Nifty was down 4.45 points at 8919.85. About 1,011 shares have advanced, 877 shares declined, while 91 shares remain unchanged.
Dr Reddy's Laboratories, GAIL were the top losers on the index, while Asian Paints, SBI and Axis Bank gained the most on both the indices.
Tata Teleservices plunged 6 percent intraday after the Reserve Bank of India (RBI) opposed its settlement deal with DoCoMo in the Delhi High Court. The central bank opposed the consent terms filed by Tata Sons and NTT DoCoMo in their long-standing dispute.
The RBI opined that the put clause agreement in the settlement is illegal and may lead to extra short-term gains for the Japanese partner.
Last month, Tata Sons agreed to pay USD 1.17 billion in damages to Japan's DoCoMo, following which, both the sides decided to approach the Delhi High Court to accept their settlement.
Shares of Dr Reddy's Laboratories plummeted 3.5 percent intraday as investors turned cautious on its plant getting 13 observations from the US drug regulator.
The US Food and Drug Administration (FDA) issued these observations for its Duvvuda oncology formulation facility. The site manufactures cytotoxic and hormonal injectables and is an important plant given Dr Reddy's focus on complex generic filings.
9:55 am Auto industry: The automobile industry is fully geared up to commence production of vehicles compliant with BS-IV emission norms from April 1 across the country, SIAM said today.
The Bharat Stage IV (BS-IV) emission norms will become applicable to all kinds of vehicles across the country from April 1 this year.
Society of Indian Automobile Manufacturers (SIAM) President Vinod Dasari in a statement said that the auto industry has not sought any deferment or delay in the implementation of the BS-IV emission norms.
"Contrary to the misinformation being perpetuated by certain sections of the society, specially environmental activists, the auto industry is fully committed to commence manufacturing of BS-IV vehicles from April 1, 2017, across the country," he added.
9:45 am FII view: Bharat Iyer of JPMorgan says equity markets are going into these elections results expecting the BJP to do well.
Consequently he expects the market's reaction to the results to be asymmetric. A win for the BJP should result in a positive reaction but a weak showing will likely result in a more adverse reaction, Iyer feels.
It may be a coincidence, but it is important to note that state election results have had a meaningful bearing on the reform agenda over the past, Iyer says.
He further says one interpretation for this trend could be that a positive verdict emboldens the ruling party to pursue the agenda with more confidence and vigour and it fragments the opposition.
9:30 am Buzzing: Shares of Dr Reddy's Labs plummeted 3.5 percent intraday as investors turned cautious on its plant getting 13 observations from the US drug regulator.
The US Food and Drug Administration (FDA) issued these observations for its Duvvuda oncology formulation facility. The facility, called Unit-7, is located in Visakhapatnam Special Economic Zone (VSEZ). The site manufactures cytotoxic and hormonal injectables and is an important plant given Dr Reddy's focus on complex generic filings.
The Unit-7 had received a warning letter in November 2015 for batch failures, a probable microbial contamination and certain lapses quality control procedures.
9:15 am Market Check: Benchmark indices opened lower, with the Nifty breaking 8900 in early trade as investors remained cautious ahead of exit polls for assembly elections later today.
The 30-share BSE Sensex was down 86.46 points at 28815.48 and the 50-share NSE Nifty fell 21.90 points to 8902.40.
GAIL and Dr Reddy's Labs were top losers among Sensex and Nifty stocks, down 3 percent followed by BHEL, ONGC, HUL, Wipro and Infosys.
Asian Paints, Hero Motocorp, Maruti Suzuki, Sun Pharma, Bajaj Auto, BPCL and TCS were early gainers.
The Indian rupee opened lower by 11 paise at 66.81 per dollar versus previous close of 66.70.
Mohan Shenoi of Kotak Mahindra Bank said, "A US Fed rate hike in March looks almost certain and currency markets seem to have fully priced it in. The rupee however is resilient on the back of FII flows into Indian equity markets."
He expects the USD-INR pair to trade in a range of 66.70-67/dollar for the day.
The dollar held gains as a stronger-than-expected US private-sector jobs figures in February sealed expectations that the Federal Reserve will raise interest rates next week.
The ADP national employment report showed that private payrolls grew the most since December 2015. Traders now price in an 85.2-percent chance of a Fed rate hike next week.
Asian equities were a mixed picture, as traders digest China's February inflation data and track crude oil prices.