Morning Notes
Date: 27.01.2012
For Internal circulation only
GRAPH
GLOBAL NEWS
Asia Stocks Snap 2-Day Rally, Yen Rises
Asian stocks snapped a two-day rally after U.S. home sales
unexpectedly fell and the yen gained against the dollar,
damping the earnings outlook for the region’s exporters.
James Hardie Industries SE (JHX), a building-materials
supplier that gets almost 70 percent of sales from the U.S.,
slid 0.3 percent in Sydney. Inpex Corp. (1605), Japan’s No. 1
energy explorer, advanced 2 percent after oil and metal
prices gained. NEC Corp., a Japanese electronics maker, slid
7.1 percent after saying it will cut 10,000 jobs and
forecasting its third annual loss in four years.
South Korean Manufacturers’ Confidence Index Is Near
Lowest Since July ‘09
South Korean manufacturers’ confidence is near a 30month low as Europe’s debt crisis dims the outlook for
exports. An index measuring expectations for February was
at 81 from January’s 79, the lowest level since July 2009, a
statement from the Bank of Korea showed in Seoul today. A
measure of expectations at non-manufacturing companies
was unchanged at 79. South Korea’s economy grew the
least in two years in the fourth quarter as exports sank
because of Europe’s crisis and a faltering global expansion,
a government report showed yesterday.
Japanese Stocks Decline on Falling U.S. Home Sales, Rising
Jobless Claims
Japanese stocks fell for a second day after new homes sales
unexpectedly fell in the U.S. and jobless benefit claims rose,
clouding the outlook for exporters. Sony Corp. (6758), a
consumer electronics company that gets about 70 percent
of its sales overseas, slid 1.5 percent. Nintendo Co. sank 5.9
percent after the world’s largest maker of video-game
consoles said its loss would triple. Mitsubishi Corp. (8058),
Japan’s largest commodities trader by market value, rose
1.1 percent as prices for crude and metals gained.
1
KEY INDICES
Indian Markets
Index
Close
Change (%)
S&P CNX NIFTY
5158.30
0.60
CNX NIFTY JUNIOR
9751.00
1.46
CNX 100
5031.05
0.74
S&P CNX DEFTY
3569.70
0.51
S&P CNX 500
4051.80
0.87
CNX MIDCAP
7051.00
1.39
NIFTY MIDCAP 50
2096.85
1.71
SENSEX
17077.18
0.48
Global Markets
Index
Close
Change (%)
S&P 500
1318.43
-0.57
NASDAQ
2805.28
-0.46
DOW JONES
12743.63
-0.18
FTSE
5795.20
1.26
DAX
6539.85
1.84
CAC 40
3322.65
-0.47
NIKKEI
8850.67
0.01
HANG SENG
20526.17
0.43
STRAITS TIMES
2900.09
0.19
Global data recorded/updated last as on 27, Jan. 7.30 a.m. IST
We Make Investment Easier
NIFTY TOP GAINERS
NIFTY TOP LOSERS
Indian Markets
Company
RELIANCE ENR
SESA GOA LTD
VIDESH SANCH
BHARAT PETRO
Indian Markets
Close
513.80
200.70
236.40
579.60
Change
(%)
7.14
5.99
4.23
4.18
Company
TATA POWER
HERO HONDA
H C L TECH
CAIRN IND
Close
105.45
1,853.90
420.80
345.85
Change
(%)
-2.04
-1.81
-1.79
-1.66
MARKET SUMMARY
Wednesday, the key domestic benchmarks closed on a strong note as the Sensex surpassed the 17K mark amid
firm cues from the Asian markets. The Metal and PSU space led the rally.
BSE SENSEX closed at 17077.18 up by 81.41 points or by 0.48 % and then NSE Nifty ended at 5158.3 up by 30.95
points or by 0.6 %.The BSE MIDCAP closed at 5834.04 up by 72.13 points or by 1.25 %, while the BSE SMLCAP
ended at 6408.45 up by 70.44 points or by 1.11 %.The BSE Sensex touched intraday high of 17130.24 and intraday
low of 17016.69 The NSE Nifty touched intraday high of 5174.15 and intraday low of 5130.25.
The weak closing of the US markets on Tuesday made little impact on domestic sentiment during morning trade.
On Tuesday, the Dow Jones Industrial Average ended down by 0.26% or 33.07 points at 12,675.75, the S&P 500
ended down 0.10% or 1.35 points at 1,314.65 and the Nasdaq closed up by 0.09% or 2.47 points at 2,786.64. Soon
after witnessing a gap up opening, the benchmarks continued to trade in the positive terrain amid firm Asian
market cues. Asian markets were trading in the positive terrain on Wednesday as a weaker yen boosted the
outlook for Asian exporters. Moreover, record quarterly earnings reported by Apple Inc., the world’s largest
technology company also lifted sentiment. Apple Inc. said that its first quarter profit more than doubled to USD
13.06 billion from USD 6 billion in the year ago period on robust iPhone and iPad sales. Moreover, the euphoria
over the CRR cut by the RBI on Tuesday also supported sentiment. However, the benchmarks pared off some of
their gains as Greece and its private creditors struggled to reach a deal on bond swap. Moreover, a third straight
decline in Japanese exports in December 2011 also weakened sentiment. Moreover, the IMF slashed its global
growth forecast to 3.3 per cent in 2012 from 4 per cent estimated earlier, which also weighed on sentiment. On
the domestic front, the expiry of the F&O contracts also lead to volatility in trade. The benchmarks extended their
gains during afternoon trade as the Sensex regained the 17K level. The benchmarks continued to trade on a firm
note before surging to the day’s high. The benchmarks pared off some their gains in the final hour of trading amid
weak opening in the European markets. Finally, the benchmarks ended on a robust note, with the Sensex and the
Nifty gaining over 0.40% each. Among the BSE Sectoral indices, BSE Metal and BSE PSU ended up 1.79% and 1.24%
respectively.
Among the 30 Sensex stocks, Coal India, Tata Motors, Tata Steel, Sterlite Industries and Maruti Suzuki closed up
3.9%, 3.78%, 2.97%, 2.47% and 2.44% respectively. Among the Sensex stocks, there were 18 advances and 12
declines. On BSE out of total shares traded 3026 , shares advanced were 1837 while 1067 shares declined and 122
were unchanged.
On the Economic front, the RBI has said that it prefers non-debt inflows into the Indian economy over debt inflows,
adding that any increase in the investment limit for foreigners in Indian debt will not be automatic.
2
We Make Investment Easier
NEWS UPDATES
MACRO
India and Thailand will sign a free trade agreement by the middle of this year, Thai Prime Minister Yingluck
Shinawatra said on Wednesday. "I hope this free trade agreement with India will be in place by the middle of this
year," Shinawatra said here in a speech at a business conference. She also said the proposed agreement will be one
of the main points of the discussion when she meets Prime Minister Manmohan Singh later on Wednesday. In the
backdrop of the stuttering Doha world trade talks, India has pushed a slew of trade agreements with the likes of
Japan and Malaysia. It also hopes to sign a similar deal with the European Union, its biggest trade partner.
COMPANY
Essar Projects, part of the Essar Group, has bagged the EPC contract for the prestigious Ro-Ro Ferry Service
Terminals at Gogha & Dahej from the Gujarat Maritime Board. The total project will cost Rs. 2.25bn and is
scheduled to be completed in 15 months. The Bhoomi Pujan of Gogha – Dahej Ro Ro Ferry Service Terminal was
performed by Honourable Chief Minister Shri. Narendrabhai Modi. The Honourable Chief Minster also laid the
foundation stone at Gogha.
Mangalore Refinery & Petrochemicals Ltd (MRPL), is reportedly worried about possible supply disruption because
of international sanctions and is keeping all options open. Sudhir Vasudeva, Chairman, MRPL was quoted as saying
that there is no supply disruption but the company is prepared for any eventuality and is in discussions with
suppliers in Latin America, the Middle East and Africa. MRPL will import about 7.1 million tonnes of Iranian crude in
2011-12 and plans to continue such imports in the next fiscal year too, added reports.
PBA Infrastructure has bagged contract worth Rs 544 million from ``Pimpri Chinchwad Municipal Corporation,
Pimpri``. The contract is for improvement and development of Dehu Alandi Road from Ch. 0/000 Km to Ch. 8/250
Km (Dehu Village to Moshi Jadhawwadi village border road).
Welspun Energy Ltd. (WEL) has inked an MoU with the Government of Andhra Pradesh for installing 500 MW of
wind power projects. WEL is the latest entrant in the booming wind energy sector in India. As a leading player in
solar energy with a portfolio of 500 MW under different stages of development, Welspun Energy has been
aggressively moving forward in the renewable energy space. The company was recently awarded the largest solar
project in India of 50 MW in a single location under the prestigious Jawaharlal Nehru National Solar Mission
(JNNSM).
Suzlon Group-subsidiary REpower Systems SE has concluded a contract for the delivery of 25 wind turbines of the
MM92 type with US developer enXco - an EDF Energies Nouvelles company. The turbines will be used at the Shlloh
IV wind farm, situated in Solano County, California. After completion, the wind farm will have a power output of
more than 50 megawatts (MW). In 2008 and 2011 REpower delivered wind turbines for enXco's Shiloh II and Shiloh
III wind farms. Together, Shiloh II, III and IV wind farms will have a capacity of more than 300 MW which makes
them REpower's largest US wind project to date.
JSW Steel has finalised a Rs 2,140-crore investment plan in its subsidiary JSW Ispat Steel Ltd to set up a coke oven, a
pellet plant and a cold rolling mill. The investments will be made through a special purpose vehicle, Amba River
Coke Ltd, a wholly-owned subsidiary of JSW Steel. The projects will come up at JSW Ispat’s Dolvi unit (in
Maharashtra’s Raigad district) and are part of a strategy to make the unit cost-effective. “The coke oven and pellet
plants will improve profitability and the cold rolled mill will increase the share of value added products from 10 per
cent to 25-30 per cent,” the company said.
3
We Make Investment Easier
TECHNICAL ANALYSIS
MOST ACTIVE STOCKS PIVOTAL GUIDANCE
Company
NIFTY
BANK NIFTY
RELIANCE
RCOM
RELCAPITAL
REL INFRA
LT
STER
ICICIBANK
SBIN
TATASTEEL
RPOWER
TATAPOWER
INFOSYSTCH
BHEL
ONGC
ACC
PUNJLLOYD
HDFCBANK
MARUTI
AXISBANK
Lower 2
5126.65
9791.15
780.16
94.38
341.54
506.00
1312.84
112.08
868.89
2028.78
438.55
96.04
104.17
2639.85
279.73
270.75
1161.58
50.67
486.81
1147.11
1038.26
Lower 1
5147.89
9819.91
785.47
95.14
344.28
510.07
1323.40
112.98
875.88
2045.10
442.08
96.82
105.01
2661.09
281.98
272.93
1170.92
51.08
490.72
1156.33
1046.61
Axis
5159.13
9857.68
792.78
95.90
347.03
514.14
1333.96
113.88
882.87
2061.42
445.61
97.59
105.85
2682.32
284.23
275.11
1180.26
51.48
494.64
1165.56
1054.96
Higher 1
5175.21
9950.59
800.30
96.56
349.43
517.70
1343.20
114.67
888.99
2075.70
448.69
98.27
106.58
2700.90
286.20
277.01
1188.44
51.84
498.07
1173.64
1062.27
BULLISH ON SHORT TERM
COALINDIA
BUY AS QUICKDELIVERY FOR BTST/T+2 WITH TARGETS OF 346-348-350 SL 334
ZEEL
BUY AS QUICKDELIVERY FOR BTST/T+2 WITH TARGETS OF 127-129-131 SL 121
4
We Make Investment Easier
Higher 2
5191.66
10009.90
803.28
96.68
349.86
518.34
1344.85
114.81
890.08
2078.25
449.24
98.39
106.71
2704.22
286.55
277.35
1189.90
51.91
498.68
1175.08
1063.58
Following the MUTUAL FUNDS
Escorts Growth – G
Latest NAV: 61.32 (24/01/12)
Returns
52-Week High: 75.21 (25/01/11)
Year
1 Year
3 Year
5 Year
Return Since Launch
Top Holdings: As on 31 Oct.
Name of Holding
Kalyani Investment
SPIC
Larsen & Toubro
UFLEX
Duncans Inds.
52-Week Low: 51.83 (20/12/11)
Fund
-18.62
19.48
1.68
18.19
Category
-12.07
30.24
4.72
-
Top 5 Sectors
% Net Assets
8.85
8.39
5.84
5.10
4.69
Top 5 Sectors
% Net Assets
Financial
Chemicals
Automobile
Healthcare
Metals
19.55
18.69
12.71
8.35
8.19
Top 3 Holding Company Details
Kalyani Investment
LTP: 421.15
PB Ratio: 0.63
PE Ratio: 28.75
Year to Date Return(%): 19.80
PE Ratio: 4.15
Year to Date Return(%): 35.85
Escorts Tax Plan
Escorts Balanced
Escorts Growth
Escorts Growth
Fund name
Escorts Growth
Escorts Growth
Escorts Tax Plan
Escorts Tax Plan
PE Ratio: 19.56
Year to Date Return:33.81
Fund name
Goldman Sachs Infra BeES
Escorts Leading Sectors
Escorts Leading Sectors
JM Core 11
5
% Net Asset
Date
9.56
9.55
9.54
8.85
Jul 31, 2011
Oct 31, 2011
Jul 31, 2011
Oct 31, 2011
% Net Asset
Date
9.52
9.38
9.29
9.19
Aug 31, 2011
Jul 31, 2011
Aug 31, 2011
Jul 31, 2011
% Net
Asset
Date
26.48
11.45
10.45
9.11
Nov 30, 2011
Aug 31, 2011
Jul 31, 2011
Dec 31, 2011
Other Funds That Own L&T
L&T
LTP: 1331.50
PB Ratio: 3.39
Fund name
Other Funds That Own SPIC
SPIC
LTP: 19.63
PB Ratio: 0
Other Funds That Own Kalyani Investment
We Make Investment Easier
Good for Delivery
JSW Steel
JSW Steel has finalised a Rs 2,140-crore investment plan in its subsidiary JSW Ispat Steel Ltd to set up a coke
oven, a pellet plant and a cold rolling mill. The investments will be made through a special purpose vehicle, Amba
River Coke Ltd, a wholly-owned subsidiary of JSW Steel. The projects will come up at JSW Ispat’s Dolvi unit (in
Maharashtra’s Raigad district) and are part of a strategy to make the unit cost-effective. “The coke oven and
pellet plants will improve profitability and the cold rolled mill will increase the share of value added products
from 10 per cent to 25-30 per cent,” the company said. The coke oven battery would have a capacity of a million
tonnes per annum (mtpa) and would cost the company Rs 975 crore. Of this, Rs 375 crore would be the equity
component, the rest coming from loans. ARCL has the environmental clearance and the plant is expected to
come on stream by the end of calendar year 2013.
The proposed four- million tonnes pellet plant at the site is estimated to cost Rs 835 crore and a 0.8 mtpa cold
rolled mill Rs 330 crore. These two projects are to be financed through a debt-equity ratio of 2:1. JSW said,
“These projects will be taken up for implementation on receipt of requisite clearances and commissioned in
FY13-14.” These three projects are integral to the turnaround effort at JSW Ispat. JSW Steel had said these
projects were priority, to get Ispat on its feet. Experts believe backward integration will solve Ispat’s profitability
issues. An analyst, on condition of anonymity, said, “The company has reiterated time and again that Ispat’s Dolvi
unit is one of the most technologically advanced in the country. However, lack of coke oven battery, pellet and
power plant has made sure the company suffers losses.” Plans to set up the coke oven battery and pellet plant
were readied even before JSW Steel decided to invest in Ispat Industries, now known as JSW Ispat Steel. Ispat
had even signed deals for this with the Indian arm of Stemcor, the world’s largest steel trading company. With
JSW Steel coming into picture, the agreement with Stemcor was dissolved and JSW decided to set up these
projects on its own. Finally, over a year after the acquisition, JSW Steel has decided to proceed. Accumulate
Axis Bank
Axis Bank, India’s third largest private Bank, announced its tie up with Samba Financial Group, Saudi Arabia, for
remitting money from Saudi Arabia to India through Speed Cash. Samba Financial Group has an asset base of
close to USD 50 billion. It has a network of over 65 branches and around 35 dedicated remittance centres
branded as “Speed Cash Centers” spread across the Kingdom of Saudi Arabia. Axis Bank has entered into an
agreement with Samba Financial Group; Saudi Arabia to facilitate remittance of money to India through Axis
Bank accounts or any of the 78000 NEFT enabled branches of over 100 other banks in India. Such remittances
would be processed seamlessly and disbursed to the intended beneficiaries by Axis Bank within 24 hours,
irrespective of whether they have a bank account or not.
Speaking on the occasion, P. Mukherjee, President – Treasury and International Banking, Axis Bank said, “Over 2
million Non-Resident Indians reside in Saudi Arabia. This tie-up with Samba Financial Group reinforces our
commitment to provide overseas Indians facilities to remit money to beneficiaries back home from across the
globe in a quick, seamless and economical manner. We are focusing on adding remittance channels for the NRI
customers of the Bank and to grow the remittance business by tying up with more and more overseas banks.”
Axis Bank offers inward remittance facility to India through tie-ups with various overseas banks, exchange
houses, money transfer operators as well as through wire transfer and its online money transfer platform,
‘AxisRemit Online’. Accumulate
6
We Make Investment Easier
DERIVATIVES NOTES
Nifty February 2012 futures were at 5176.55,
at a premium of 18.25 points compared to
spot closing of 5158.30. Turnover on NSE`s
futures & options (F&O) segment declined to
Rs 191776.53 crore from Rs 205305.78 crore
on Tuesday, 24 January 2012.
Institutional Investment Trends
(in Crores) Jan 25, 2012
BUY
SELL
OIEoD
3122.87
3137.51
11979.65
INDEX OPTIONS
15981.92
15115.36
26090.52
STOCK FUTURES
6570.20
6373.75
25755.34
STOCK OPTIONS
494.63
529.54
287.36
INDEX FUTURES
State Bank of India (SBI) February 2012
futures were at 2034, at a discount compared
to spot closing of 2045. Tata Motors February
2012 futures were at 230.55, near pot closing
of 230.45.
Axis Bank February 2012 futures were at
1041, at a discount compared to spot closing
of 1054. In the cash market, the S&P CNX
Nifty gained 30.95 points, or 0.6% to settle at
5,158.30, its highest closing level since 11
November 2011.
Put Call Ratio
Symbol
INDUSINDBK
MAX
IGL
GESHIP
SYNDIBANK
CNXIT
DCHL
MCLEODRUSS
DABUR
HOTELEELA
BFUTILITIE
NMDC
MRPL
JSWENERGY
MINIFTY
HEXAWARE
7
Expiry Date
25-Jan-12
25-Jan-12
25-Jan-12
25-Jan-12
25-Jan-12
25-Jan-12
25-Jan-12
25-Jan-12
25-Jan-12
25-Jan-12
25-Jan-12
25-Jan-12
23-Feb-12
25-Jan-12
29-Mar-12
25-Jan-12
Put
69000
26000
26500
31000
94000
10500
180000
71000
182000
120000
10000
31000
32000
556000
60
156000
Call
2000
1000
1500
2000
8000
1000
20000
9000
24000
24000
2000
7000
8000
168000
20
52000
We Make Investment Easier
Ratio
34.50
26.00
17.67
15.50
11.75
10.50
9.00
7.89
7.58
5.00
5.00
4.43
4.00
3.31
3.00
3.00
DIVIDEND AND OTHER INFORMATION
Sesa Goa Limited has informed the Exchange that the Board of Directors of the Company at its meeting held on
January 25, 2012, inter alia, has declared Interim Dividend for the Financial Year 2011-2012 @ Rs. 2/- per share on
face value of Re. 1/- and the Interim Dividend shall be paid / despatched on or before the due date, i.e. February
23, 2012.
Power Grid Corporation Of India Limited has informed the Exchange that the Company has fixed February 14,
2012 as the Record Date for the purpose of ascertaining the eligibility of the Shareholders for payment of Interim
Dividend, if declared, by the Board of Directors.
Equity Research Division
16, Krishna Market, 1st Floor, Kalkaji, New Delhi 110019
Phones: 47152214-15, Fax 47152211 Email: equityresearch@ndaindia.com
Regd. & Corp. Office
Equity Research Division
1002A, 10th floor, Arunachal, 19 Barakhamba Road, New Delhi-110001, Phones: 011-46204000 (30 lines), 23717551, Fax 011-46204050
Web: www.ndaindia.com Email: info@ndaindia.com, investorcell@ndaindia.com
Mumbai Office
21, Prospects Chamber Annexe Dr. D N Rd, Fort, Mumbai-400001 Phones: 022-22842694, 22851387
Branches &Associates
Disclaimer: This document is meant for private circulation only and has been prepared by RScaS. This document is not to be reported,
copied or made available to any other without written permission of NDA. The information contained in this report has been obtained
from sources that are believed to be reliable and NDA has no responsibilities for the accuracy of the facts stated. The recommendation
made herein does not constitute an offer to sell or solicitation to buy any securities. This report does not provide individually tailored
investment advice. It has been prepared without regard to the individual financial circumstances and objectives of persons who receive
it. The securities discussed in this report may not be suitable for all investors. NDA Securities recommends that investors independently
evaluate particular investments and strategies, and encourages investors to seek the advice of a financial adviser. The appropriateness of
a particular investment or strategy will depend on an investor's individual circumstances and objectives. The readers using the
information are solely responsible for their actions. Either NDA or its affiliates, directors, employees, representatives, clients or their
relatives may or may not have position(s) in the stocks recommended.
8
We Make Investment Easier