Religare Morning Digest

Transcription

1 Nifty Outlook It was an awful day for the equity markets as Nifty tanked over three percent and closed below the psychological level of Though the bias was on negative from the beginning, but selling intensified after country s biggest PSU bank, SBI, reported weaker than expected results. Besides, feeble start of European markets further added to the pressure. We are not completely surprised with Thursday s fall in Nifty, but our anticipation was that it would be gradual. We were expecting Nifty to take a pause around 7100 level first but it breached that mark in no time and penetrated 7000 as well. All this shows the level of pessimism among the investors and the fall is not over yet. Keeping all in mind, we maintain our advice to avoid undue risk and prefer low beta counters for day trades. On the other hand, investors should keep their shopping list ready and gradually accumulate quality stocks on every decline with medium to long term investment view. VWAP Max Call Max Put News Nifty United Bank of India net profit dropped 59.31% to Rs 17 crore on 3.64% drop in total income to Rs crore in Q3 December 2015 over Q3 December Bank of India reported net loss of Rs crore in Q3 December 2015 as compared to net profit of Rs crore in Q3 December State Bank of India net profit fell 61.67% to Rs crore on 6.73% rise in total income to Rs crore in Q3 December 2015 over Q3 December Oriental Bank of Commerce reported net loss of Rs crore in Q3 December 2015 as compared to net profit of Rs crore in Q3 December Religare Super Ideas Scrip Buy/Sell CMP Initiation Range SL Target TATASTEEL SELL FEB RELINFRA SELL FEB Derivative Ideas : Instrument B/S Lot INITIA- TION RANGE SL TARGET NIFTY 6800 PE BUY Sectors to watch Sector Name Outlook FMCG STABLE IT POSITIVE PHARMA STABLE FII & DII activity (Rs. in Cr.) Category Amt MTD YTD FII -751 (2538) (23778) DII *FII & DII data as on 10th February 2016 Trade Stats NO OF CON- TRACTS TURNOVER IN CR IDXFUTS IDXOPT STKFUTS

2 Religare Super Ideas Tata Steel Limited (TATASTEEL) Reliance Infrastructure Limited (RELINFRA) Derivative Ideas Fresh short buildup seen in Nifty futures along with the buying seen in 7000 nifty put strike. We expect Nifty to trade in range in the short term. Strategy: BUY Nifty feb 6800 sloss at 44, target 95. TATASTEEL is trading below long-term averages 100/200 EMA s, indicating weak trend. It is looking weak on all chart formats - daily, weekly & monthly with no signs of respite. All this indicates bearish bias to continue in the near-term as well. RELINFRA has seen vertical sell-off in the month of January-16, it fell from 620 to 440 levels. Later, it spent some time consolidating around the confluence zone of its 100/200 EMA s. Yesterday, i.e. 11th Feb-16, it fell below major supports and lost nearly 10%, this has opened the gates for further sell-off. Investment Pick - SML Isuzu Limited SMLISUZU Scrip CMP Recommendation Price Target Duration SMLISUZU Months SML Isuzu Limited (SMLI) is engaged in the business of manufacturing Light commercial vehicles. The company manufactures buses, trucks and other customized vehicles like Ambulances, Prison van, Refrigerated van, etc. SML Isuzu is mainly concentrated in 5 to 12 tonnes GVW segment. Key investment rationales are investment plan, focus on niche segment, collaboration with Isuzu Motors and operational leverage benefits. 2

3 Corporate Action Calendar February 2016 (Cash Dividend) Sun Mon Tue Wed Thu Fri Sat Transport Corp of India Ltd Granules India Ltd Shree Cement Ltd GMM Pfaudler Ltd Aarti Industries VRL Logistics Ltd KPR Mill Ltd Gateway Distriparks Ltd Greaves Cotton Ltd Aarti Drugs Ltd VIP Industries Ltd AVT Natural Products Ltd India Nippon Electricals Ltd Torrent Pharmaceuticals Ltd Accelya Kale Solutions Ltd Shanthi Gears Ltd Sundaram Finance Ltd Credit Analysis & Research Ltd Neyveli Lignite Corp Ltd Granules India Ltd NCL Industries Ltd Havells India Ltd Sharda Motor Industries Ltd Cholamandalam Investment and Finance Co Ltd Aptech Ltd Banco Products India Ltd ISGEC Heavy Engineering Ltd Hindustan Petroleum Corp Ltd Cummins India Ltd Damodar Industries Ltd JM Financial Ltd Economic Calendar February 2016 Sun Mon Tue Wed Thu Fri Sat GVA YoY GDP YoY GDP Annual Estimate YoY 09 Local Car Sales 10 Trade Balance Imports YoY Exports YoY Industrial Production YoY CPI YoY 13 3

4 Result Calendar February 2016 (Cash Dividend) Sun Mon Tue Wed Thu Fri Sat SAVEN TECHNOLOGIES BOMBAY DYEING & MFG.CO. FIRST FINANCIAL SERVICES Gujarat Gas Ltd HITACHI HOME AND LIFE SOLUTIONS (INDIA) Inox Wind Ltd IPCA LABORATORIES JK TYRE & INDUSTRIES PTC INDIA FINANCIAL SER- VICES REPCO HOME FINANCE SRF Strides Shasun Ltd TV TODAY NETWORK ALLAHABAD BANK APOLLO TYRES BHARAT FORGE BRITANNIA INDUSTRIES CENTRAL BANK OF INDIA CESC CRISIL DENA BANK DR.REDDY'S LABORATORIES EROS INTERNATIONAL MEDIA GAIL (INDIA) Gulf Oil Lubricants India Ltd HINDALCO INDUSTRIES MOTHERSON SUMI SYSTEMS POWER FINANCE CORPORA- TION PUNJAB NATIONAL BANK RAMCO INDUSTRIES STEEL AUTHORITY OF INDIA ACC AMBUJA CEMENTS BAJAJ ELECTRICALS LTD BATA INDIA BLUE DART EXPRESS CIPLA FINOLEX CABLES GMR INFRASTRUCTURE INDIA CEMENTS INDIAN OVERSEAS BANK BANK OF MAHARASHTRA NHPC PETRONET LNG SRS TATA CHEMICALS UCO BANK Wonderla Holidays Ltd ADITYA BIRLA NUVO ASHOK LEYLAND BANK OF INDIA BEML BHARAT HEAVY ELECTRI- CALS COAL INDIA Coffee Day Enterprises Ltd CITY UNION BANK HINDUSTAN MOTORS HERO MOTOCORP ICRA INDIAN BANK Jubilant FoodWorks Ltd NATCO PHARMA NCC Limited ORIENTAL BANK OF COM- MERCE STATE BANK OF INDIA TATA MOTORS Tata Motors Ltd - DVR UNION BANK OF INDIA ALOK INDUSTRIES ANDHRA BANK CANARA BANK CEAT Dhanlaxmi Bank Limited ESAAR (INDIA) HINDUSTAN FOODS INDIAN OIL CORPORA- TION MAX INDIA NESTLE INDIA NMDC OIL INDIA P.I.INDUSTRIES PUNJ LLOYD SUN TV NETWORK Welspun Enterprises Ltd ADANI POWER BANK OF BARODA FINOLEX INDUSTRIES JBM AUTO UNITECH VOLTAS WOCKHARDT 4

5 Market Snapshot Sectoral Indices Performance Index Closing % Change % MTD % YTD NIFTY Auto 6, % -8.6% -15.8% NIFTY Bank 14, % -9.6% -17.1% NIFTY Energy 7, % -10.4% -11.1% Nifty Financial Services 5, % -9.6% -16.6% NIFTY FMCG 18, % -4.7% -9.7% NIFTY IT 10, % -8.2% -8.0% NIFTY Media 2, % -11.8% -17.3% NIFTY Metal 1, % -8.4% -16.8% NIFTY Pharma 11, % -5.6% -7.2% NIFTY PSU Bank 1, % -13.5% -30.7% NIFTY Realty % -14.4% -23.8% Top Gainers - Nifty Stock CMP (INR) % Chg % MTD % YTD IDEA % -1.9% -29.6% CIPLA % -7.6% -16.8% DRREDDY 2, % -7.1% -7.2% Top Losers - Nifty Stock CMP (INR) % Chg % MTD % YTD ADANIPORTS % -12.0% -28.4% VEDL % -13.2% -31.1% BHEL % -13.3% -28.9% KOTAKBANK % -8.0% -12.7% TATAMOTORS % -18.0% -29.4% Bulk Deals - NSE Delivery Spurt stocks Security Name Client Name Buy/Sell Quantity Price Value (in Cr.) Justdial Ltd. NORDEA EMERGING MARKET EQUITY SELL Housing Development and SHAASTRA SECURITIES TRADING PRIVATE SELL Housing Development and SHAASTRA SECURITIES TRADING PRIVATE BUY Unitech Ltd LIMITED AMRABATHI INVESTRA PRIVATE SELL Nahar Spinning Mills Ltd. RAKESH RAJKRISHAN AGARWAL SELL Sanco Industries Ltd. CHP FINANCE PVT LTD SELL Crest Ventures Limited FINE ESTATES PRIVATE LIMITED BUY Crest Ventures Limited MIRAJ MARKETING COMPANY LLP SELL MRO-TEK Limited JITENDRA VIRWANI BUY Unitech Ltd LIMITED AMRABATHI INVESTRA PRIVATE BUY Stock Name Day's del. Vol. Del. Vol. Price Kansai Nerolac 900, % -1.98% ITD Cem 103, % -6.55% Tree House Edu. 340, % -3.56% IndusInd Bank 3,206, % -2.87% Godfrey Phillips 44, % -8.55% Tata Chemicals 1,274, % -4.51% Bank of Baroda 5,897, % -0.81% Just Dial 887, % -7.97% Maruti Suzuki 572, % -3.73% Bata India 406, % -1.39% 5

6 Current Portfolio and Performance Summary as on 11 th February 16 Stock Sector Entry Date Weight Reco price (`) CMP (`) Repco Home Finance Limited Financial Services 7/21/ % HCL Technologies IT 10/29/ % 882* 808 PI Industries Fertilisers & Pesticides 7/23/ % Hero MotoCorp Auto 8/13/ % 2,660 2,497 Maruti Suzuki India Auto 9/8/ % 4,088 3,541 Dewan Housing Finance Corporation Financial Services 2/10/ % 163* 151 Bata India Consumer Goods 11/23/ % Alembic Pharmaceuticals Limited Pharmaceuticals 12/8/ % Cummins India Industrial Manufacturing 12/17/ % 1, Axis Bank Financial Services 12/30/ % Cash Cash 21.1% Total Total 100% *4.5% HCL Tech was bought at 983 *7.5% DHFL was bought at 237 6

7 Historical Performance as on 11 th February 16 Performance Matrix 1-Month 3-Month 6-Month 1-Year Since Inception Religare Alpha -8.15% % % % 3.50% Nifty -7.77% % % % % Outperformance -0.38% 0.30% 2.86% 7.60% 15.02% 7

8 Research Product Basket For cash market trading Call / Product Call Frequency. of calls Avg open call duration % funds allocated Intraday Calls Intraday 2-3 < 1 day 25% Live / RMD Calls Daily days 30% Master Pick Weekly 1 1 month 15% Religare Alpha Opportunity NA 2-3 months 20% Cash NA 10% Intraday Calls Live / RMD Calls Master Pick Religare Alpha Cash Total For 1L margin* Per Call 25,000 8,000 30,000 4,000 15,000 5,000 20,000 As per weightage These calls are flashed live on Ms Lync and ODIN with the purpose of squaring off positions on the same day. As a policy, we restrict our intraday cash market calls to less than 4 calls a day. Hence, funds should be allocated accordingly to have provision to trade in all calls. 2 super ideas are flashed in RMD daily with a view of 3-4 days. Additionally as per market opportunity, we flash live calls during the day (including BTST calls). 3-4 such calls are made on a daily basis which might be open for 3-4 days. Funds should be allocated keeping in mind that there will be 7-8 such open calls daily. This is our weekly recommendation shortlisted on the basis of techno-funda analysis. 15% of funds is recommended to be allocated for Master Pick considering that there will be 3 open calls. The average open duration for this call will be 1 month. This is a portfolio of 8-10 stocks which are held with a view of 2-3 months. It is recommended to allocate 20% of funds for building this portfolio which will provide stability to the overall trading portfolio. 10,000 10% surplus cash in the portfolio should be kept for the purposes of allocating it to opportunities as and when they arrive. For derivative market trading Call / Product Call Frequency. of calls Avg open call duration % funds allocated Derivative Ideas Daily days 40% Live calls Intraday / Daily days 50% Cash NA 10% Derivative Ideas Live Calls Cash For every client, the advisor must allocate a specific proportion of funds for trading and investing depending on the risk taking ability and willingness of the client and their investment goals. The below mentioned product basket tries to address the way to deal with the trading portfolio (cash/derivative) for optimum effectiveness of research calls. It is recommended to divide your trading funds for various types of calls and not invest the entire amount for 1 or 2 calls only. Total For 1L margin* Per Call 40,000 40,000 50,000 50,000 1 derivative idea is shared in RMD daily. It can be a plain vanilla F&O buy/sell call or an option strategy. Funds should be allocated assuming 2 such calls will be open at any time. These calls are open for 3-4 days on an average. These calls are flashed on MS Lync and ODIN during live market hours. These calls can be intraday or with a view of 2-3 days. Funds should be allocated considering 2 such calls will be open at any time. 3/4 times, these calls will be on Nifty / Bank Nifty only. It is recommended to hold 10% cash to capitalize on any opportunity that may arise in markets. 10,000 8

9 Team Members Ajay Kumar Srivastava Ajay Pasari, CFA Ajit Mishra Ashish Bansal Gaurav Sharma Swati Saxena Manoj M Vayalar Vipin Kumar ajaykumar.s@religare.com ajay.pasari@religare.com ajit.mishra@religare.com ashish.bansal@religare.com gaurav.sh@religare.com swati.saxena@religare.com manoj.vayalar@religare.com vipin.k@religare.com 9

10 Before you use this research report, please ensure to go through the disclosure inter-alia as required under Securities and Exchange Board of India (Research Analysts) Regulations, 2014 and Research Disclaimer at the following link : Specific analyst(s) specific disclosure(s) inter-alia as required under Securities and Exchange Board of India (Research Analysts) Regulations, 2014 is/are as under: Statements on ownership and material conflicts of interest, compensation Research Analyst (RA) [Please note that only in case of multiple RAs, if in the event answers differ inter-se between the RAs, then RA specific answer with respect to questions under F (a) to F(j) below, are given separately] S.. Statement Answer I/we or any of my/our relative has any financial interest in the subject company? [If answer is yes, nature of Interest is given below this table] I/we or any of my/our relatives, have actual/beneficial ownership of one per cent. or more securities of the subject company, at the end of the month immediately preceding the date of publication of the research report or date of the public appearance? Yes I/we or any of my/our relative, has any other material conflict of interest at the time of publication of the research report or at the time of public appearance? I/we have received any compensation from the subject company in the past twelve months? I/we have managed or co-managed public offering of securities for the subject company in the past twelve months? I/we have received any compensation for brokerage services from the subject company in the past twelve months? I/we have received any compensation for products or services other than brokerage services from the subject company in the past twelve months? I/we have received any compensation or other benefits from the subject company or third party in connection with the research report? I/we have served as an officer, director or employee of the subject company? I/we have been engaged in market making activity for the subject company? Nature of Interest ( if answer to F (a) above is Yes : Name(s) with Signature(s) of RA(s). [Please note that only in case of multiple RAs and if the answers differ inter-se between the RAs, then RA specific answer with respect to questions under F (a) to F(j) above, are given below] Copyright in this document vests exclusively with RSL. This information should not be reproduced or redistributed or passed on directly or indirectly in any form to any SS... Name(s) of RA. Signtures of RA Serial Question of question which the signing RA needs to make a separate declaration / answer Yes. other person or published, copied, in whole or in part, for any purpose, without prior written permission from RSL. We do not guarantee the integrity of any s or attached files and are not responsible for any changes made to them by any other person. 10