Religare Morning Digest

Transcription

1 Nifty Outlook Markets made a feeble start of the week and shed over a percent, tracking weak global cues. It traded under pressure after the gap-down start however marginal bounce in the latter half pared some losses. It was the fear of possible trade war, after the US President plans to impose new tariffs on steel and aluminum imports, rattled global markets including ours. Besides, the report that the foreign investors have pulled out more than 11,000 crore from the equity markets in February month was further weighing on the sentiments. First, local factors viz. banking fraud, mixed macroeconomic data were pushing the markets lower and now the global sentiment has turned sour. We advise continuing with sell on rise approach and focus more on the stock selection. News VWAP (Expiry till date) Max OI (Call) Max OI (Put) NIFTY The Adani Group, in January, had decided to demerge its gas sourcing and distribution business into a new company called Adani Gas Ltd (AGL). AGL is now planning to go for direct listing of shares instead of an initial public offering. This step would support issuing shares directly to public and help in cost saving. AGL supplies piped natural gas (PNG) to households and industries and compressed natural gas (CNG) for transportation. Going ahead AGL has aggressive expansion plans for setting up city gas distribution network, which also has good future in India. Sterlite power plans to invest about USD 10 Bn in domestic and international markets over next 3-4 years. Currently the company has 15 project portfolios across India and Brazil worth USD 4 Bn. There is vast scope in transmission business both in domestic (after government opened up the sector to private players) and international markets which will help Sterlite power to gain market share in near future. Thomas Cook (India) is the leading integrated travel and travel related financial services company in the country offering a broad spectrum of services that include foreign exchange, corporate travel, MICE, leisure travel, insurance, visa & passport services and e-business. The board of directors gave consent to the management to explore the possibility of an internal corporate restructuring exercise that would enable the company to focus on travel related business, give the shareholders direct exposure and shareholding in the business of Quess Corp and enhance the stakeholders' value. Derivative Ideas ** Sectors to watch Religare Super Ideas** Scrip Buy/Sell CMP FII & DII Cash Segment (Rs. in Cr.) Initiation Range Trade Stats SL* Target SRTRANSFIN BUY ENGINERSIN SELL FUTS **Please note that the given technical and derivative recommendations are "valid for taking position" only on recommended date and in the given range. *Please note - Stoploss is on closing basis for delivery recommendation and intraday basis for futures recommendation. Instrument B/S Lot TITAN BUY 800PE INITIATION RANGE SL TAR- GET Sector Name AUTO ENERGY FMCG Outlook STABLE STABLE STABLE Category Amt.** MTD FYTD FII DII** **Provisional data as on 1st March 2018 NO OF CON- TRACTS TURNOVER IN CR IDXFUTS IDXOPT STKFUTS

2 Religare Super Ideas Shriram Transport Finance Company Limited (SRTRANSFIN) Engineers India Limited (ENGINERSIN) Derivative Ideas TITAN added around 1.50% in open interest as short buildup was seen in it. Current chart pattern too indicate further decline in its price. We suggest buying TITAN options as per below levels. Strategy: Buy TITAN 800PE between 15-16, SL 9, TGT 30 We are reiterating our long recommendation in SRTRANSFIN with the updated levels as it was not initiated earlier. ENGINERSIN, after sharp plunge of late, witnessed marginal bounce but failed to cross its resistance barrier of multiple moving averages on daily chart and has formed a fresh shorting pivot. The chart pattern and the indications are also in the favor of further slide ahead. Traders are advised to create fresh short positions in the given range. Investment Pick - Century Plyboards Scrip CMP Recommendation Price Target Duration CENTURYPLY Months Century Plyboards (I) Ltd (CPIL) reported healthy set of numbers for Q3FY18 with net revenue and PAT growth (standalone) of 19.9% & 25.1% YoY respectively. Led by high margin MDF segment, the overall EBITDA margins improved by 137bps YoY to 17.2%, which was encouraging. We remain positive on CPIL s medium to long term growth prospects, given its strong presence across various wood panel segments (leadership in organized plywood sector), steady capacity additions, increasing focus on the high margin MDF segment and Government s thrust on affordable housing. We recommend a BUY on the stock with target price of Rs

3 Religare Investment Calls Name of the Company Reco Date Reco Price Target Price Upside % Previous day Closing Price Indo Count Industries Ltd. 17-May % 99.1 CRISIL 01-Aug-17 1,858 2, % 1,950.1 LIC Housing Finance 09-Aug % The Byke Hospitality 17-Aug % Tata Communications 18-Sept % GNA Axles 22-Jan % Force Motors 25-Jan-18 3,250 4, % 2,952.4 Swaraj Engines Ltd 25-Jan-18 1,989 2, % 1,928.4 Nilkamal Ltd. 30-Jan-18 1,837 2, % 1,686.4 APL Apollo Tubes 31-Jan-18 2,255 2, % 2,040.2 Symphony Ltd. 31-Jan-18 1,815 2, % 1,772.2 Manpasand Beverages 1-Feb % Bharat Electronics Ltd. 7-Feb % Kajaria Ceramics Ltd. 7-Feb % Mold-Tek Packaging 8-Feb % Srikalahasthi Pipes Ltd 8-Feb % Navneet Education 9-Feb % Castrol India Ltd 12-Feb % Eicher Motors Ltd 12-Feb-18 27,748 34, % 27,548.4 Avanti Feeds 12-Feb-18 2,504 2, % 2,438.5 Talwalkars Better Value Fitness 12-Feb % NRB Bearings 14-Feb % S Chand & Company 14-Feb % Sutlej Textiles 15-Feb % 79.2 Minda Corporation 15-Feb % Wonderla Holidays 16-Feb % Garware Wall Ropes Ltd 16-Feb , % Jamna Auto Industries 16-Feb % 78.7 Fiem Industries 19-Feb , % SML Isuzu 22-Feb , % Asian Granito India Ltd. 22-Feb % Time Technoplast 23-Feb % VIP Industries Ltd. 26-Feb % Century Plyboards 27-Feb %

4 Corporate Action Calendar March 2018 (Cash Dividend) Gilada Finance & Investments Ltd 06 TVS Motor Co Ltd Power Finance Corp Ltd 07 DCM Shriram Ltd 08 Housing & Urban Development Corp Ishan Dyes And Chemicals CESC Ltd Corporate Action Calendar March 2018 (Acquisition) Date Target Company Acquirer Company 3/7/2018 Frontier Informatics Ltd Private Investor 3/8/2018 Modella Woollens Ltd Sundder Suvidha LLP 3/10/2018 M/s Guardian Finance Pvt Ltd Padmanabh Industries Ltd Corporate Action Calendar March 2018 (Stock Buyback) Elegant Marbles & Grani Industries Ltd Bharat Electronics Ltd 06 Gandhi Special Tubes Ltd Corporate Action Calendar March 2018 (Stock Split) HB Stockholdings Ltd 10 Economic Calendar March Nikkei India PMI Services Nikkei India PMI Composite BoP Current Account Balance 4

5 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 5

6 Team Members Hitesh Agrawal Ajay Pasari, CFA Ajit Mishra Manoj M Vayalar Mehernosh Khurshed Panthaki Nirvi Ashar Rohit Khatri Suhanee Shome hitesh.agrawal@religare.com ajay.pasari@religare.com ajit.mishra@religare.com manoj.vayalar@religare.com mehernosh.panthaki@religare.com nirvi.ashar@religare.com rohit.khatri@religare.com suhanee.shome@religare.com 6

7 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. 7