Closing bell: Sensex tanks 424 points; Nifty fails to sustain above 11,000 levels
Nifty has a strong resistance at 11,200 levels and has a strong support at 10,800. Till Nifty is above 11,000 but below 11,200 its trading range would be 10,800 to 11,200.
On account of looming slowdown crisis and no positives coming out of the US-China trade stand-off, the Indian indices have been witnessing heavy sell-off since the market opened on Friday. The BSE Sensitive Index crashed 424 points to 36,546 while the 50-share Nifty index shed 125 points lower to 10,943 levels. Auto, industry, banking and telecom sector bleeds heavily. Shares of Tata Motors led the tank by bleeding over 17 per cent. MRF went down by around 5.29 per cent, Cummins India scrip slipped by around 2.18 per cent while shares of Bharat Forge slide by 2.2 per cent, Eiher Motors slide by 4.4 per cent and Exide Industries slide by more than 3 per cent.
Commention upon the markt outlook Simi Bhaumik, a SEBI registered technical equity analyst told Zee Business online, "Nifty has a strong resistance at 11,200 levels and has a strong support at 10,800. Till Nifty is above 11,000 but below 11,200 its trading range would be 10,800 to 11,200. Any break of either higher or lower side would determine its bullish or bearish run in coming trading sessions."
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Shares of Tata Motors, Union bank of India, SAIL, Ujjivan Financials and Magma Fincorp were the top losing stocks today. Tata Motors crashed by more than 17 per cent, Union Bank shares went down by 7.8 per cent, SAIL counter went down by 7.7 per cent, Ujjivan Financials scrip nosedived by around 7.2 per ent while Magma Fincorp went southward by 7.1 per cent.
Reliane Power, Reliance Capital, Reliance NIPLife, Raymond and Shipping Corporation stock have been the top gainers in this bleeding trading session. Reliance Power scrip went up by more than 13.5 per cent, Reliane Capital stock rose by over 9 per cent while Reliance NipLife stocks suge over 6.5 per cent. Shares of Raymond ltd. went up by over 6 per cent while Shipping Corporation stocks went up by more than 5.5 per cent.
Jet Airways counter crash lands
After remaining unaffected by the heavy sell-off for almost day, the Jet Airways finally succumb to the bear run on Friday. The Jet Airway scrip rashed by around 1.44 per cent to Rs 233 pr share levels.
Buy Entertainment Network India for 26% gains, advises Elara Securities
Entertainment Network revenue surged 35% YoY to Rs 2,009mn, led by strong growth across the radio and non-radio segments. EBITDA margin declined 390bp YoY to 20.1%, due to the negative impact of new concerts added and losses in new stations. PAT grew 23% to Rs 161mn due to higher other income. Its revenue from the radio segment grew 25% YoY to Rs 1,243mn.
On their suggestion to the market investors in regard to the counter Karan Taurani, Analyst at Elara Securities informed in a detailed researh report that says the fundamentals of the counter are strong. The scrip has potential to move upside for 26 per cent. "We recommend investors to buy the Entertainment Network India counter for the target of Rs 690." Currently, the scrip is oscillating around Rs 548 per stock levels.
Buy MRF for 16% gains, advises Elara Securities
Revenues of the MRF increased 6% YoY to Rs 40.3bn, which is above 1% of the market expectations. This is in comparison to CEAT/ Apollo standalone revenue growth of 8%/ 17% YoY. MRF EBITDA declined 21% YoY while grew 1% QoQ to Rs 5.5bn (2% below market estimates). EBITDA margin dipped 30bp QoQ to 13.7% (outperforming CEAT/ Apollo standalone dip of 80bp/ 100bp QoQ). RMC/ sales increased 50bp QoQ to 61.3%. Other expenses increased 18% YoY and 3% QoQ to INR 7.1bn (vs CEAT stdalone increase of 17% YoY and 8% QoQ); likely led by higher ad-expenses.
On their suggestion to the market investors Jay Kale, CFA at Elara Securities informed in a detailed researh report that says the fundamentals of the counter are still strong. The scrip has potential to move upside for 16 per cent. "We recommend investors to buy the MRF ounter for the target of Rs 68,974." Currently, the scrip is oscillating around Rs 59,411 per stock levels.
Auto sector bleeds heavily
The BSE Auto index crashed by over 500 points or 2.55 per cent. Tata Motors is leading the crash by sheding more than 17 per cent from its Thursday close. TVS Motor Company too went down by 2.2 per cent, maruti Suzuki shares are own by more than 1 per cent, MRF stocks are down by more than 4 per cent, Exide Industries counter too are down by mor than 2 per cent, Eicher Motors counter is down by more than 3 per cent wwhile Cummins India is hit by more than 2.5 per cent even after good third quarter results.
Asian markets extend their losses
On weak global cues, the Asian markets too have extended their losses. The Japanese index Nikkei slide near 2 per cent from early 0.5 per cent losses while Hang Seng was down by around 0.27 per cent.
Buy Lupin for 17% gains, advises HDFC Securities
While 1HFY19 was weak for Lupin, the company reported decent revenue growth in 3Q (up 8% YoY), despite a delayed onset of the flu season in the US. On the margins front, market exeprts saw the impact of a lower gross margin and higher specialty spend weigh in on profitability. They are anticipate 4Q to be stronger for Lupin, owing to gRanexa launch and increased intensity in the flu season.
On suggestion for investors in regard tio Lupin counter Amey Chalke, Analyst, HDFC Securities told, "The counter looks strong and shows potential upside swing of near 17 per cent. An investor can buy the stock for target of Rs 985/counter." the stok is currently osccillating arouynd Rs 842/share levels.
RComm, RInfra finally gains
After bleeing heavily in last few trading sessions Anil Ambani owned Reliane Communications and Reliane Infra showed some positive momentum at Dalal Street. The Reliance Infra stock gained over 5 per ent while the Reliance Communicatio shares surge over 3 per cent on Friday morning trading session.
Expert opinion on market outlook
Mehul Kothari, Senior Technical Analyst - Equity at IndiaNivesh told, "In our previous edition we stated that post the range breakout above 11000mark, Nifty is poised to test upside levels of 11084 – 11145 in the coming sessions. In line with that yesterday Nifty sneaked above 11100 mark but closed flat. As a result, Nifty has formed a ‘Doji’ candlestick pattern right at the 61.8% Fibonacci retracement level of the previous move as displayed above. A move below yesterday’s low of 11043 might dwell the momentum for time being."
A move above the high of 11118 might extend the upside towards 11200 mark. Although the trend is very strong and we might witness an extension of the rally going forward but it’s wise to keep booking long positions since the heavy weights are yet to correct.
Industry stocks follow auto bear
Following the auto sector, industry sector too tank heavily. Industry major Atlanta Ltd crashed by around 4.85 per cent, Balmer Lawrie and Company stocks went down by more than 3.5 per cent, Elecon Engineering stocks slide by mnore than 4.5 per cent, GPT Infraprojects went down by more than 4.5 per cent, IL&FS Engineering and Construction stocks went southward by 4.76 per cent while IL&FS Transportations Network shares crashed by around 4.9 per cent.
Auto atocks lead the bleeding
Shares of Tata Motors led the tank by bleeding over 17 per cent. MRF went down by around 1.1 per cent, Cummins India scrip slipped by around 1.25 per cent while shares of Bharat Forge, Eiher Motors and Exide Industries slide by more than half a per cent.
Buy Dish TV for more than 100% gains, advises HDFC Securities
Despite losing grip of the counter, experts are bullish on the stock. DITV’s 3QFY19 was in-line but weak. Modest subscriber additions at 142k and 3.5% QoQ decline in ARPU (2nd quarter in a row) to Rs 200 were key negatives. Performance may further weaken as Jio starts its competing ‘Giga Fiber’ services. DITV’s poor execution, governance (aggressive accounting and BS issues) and sharp swings in ARPU (almost every year/quarter) displeases investors.
Suggesting invstors in regard to Dish TV scrip outlook Himanshu Shah, Analyst, HDFC Securities told, "We recommend investors to maintain buy position in the scrip for the target of Rs 50 per stock levels." Currently, the scrip is revolving around Rs 23 per share levels.
Buy Muthoot Finance for 23% gains, advises IDBI Capital
Muthoot Finance reported tad soft Q3FY19, with AUM growth of 15% YoY as against 17% last quarter on account of tighter liquidity condition in the market. NII at Rs10.9bn (flattish YoY) and PAT at Rs4.9bn (growth of 1% YoY) are both 6% below our expectations. Stage III loan assets are flattish sequentially at 2.0%. All the subsidiaries are witnessing healthy traction, accounting for 11% of the overall loan book. We have cut our earnings estimates by 2%/4% for FY19/20 respectively.
On outlook for market investors in regard to Muthoot Finance scrip, a detailed report by IDBI Capital credited to Hatim Broachwala and Neelam Bhatia suggests that the counter is looking positive and poised for an upside swing of near 23 per cent. An investor can buy the scrip for the target of Rs 595 per counter. currently, the scrip is revolving around Rs 484 per stock levels.
Buy Prism Johnson for 72% gains, advises Elara Securities
Prism Johnson reported a standalone EBITDA of Rs 1.04bn, ahead of our estimates of Rs 0.87bn, and Bloomberg Consensus of Rs 0.94bn. It posted revenue growth of 11% of around Rs 14.3bn. EBITDA margin expanded 90bp YoY and 150bp QoQ to 7.2%, due to margin improvement in the cement businesses. The company posted a net profit at Rs 190mn, posting growth of 28% YoY and 170% QoQ.
On suggestion for the market invetors in regard to counter potential for return Ravi Sodah, Research Analyst at Elara Securities informed in a detailed research report, "The counter looks positive in short-term and can show an upside potential for around 72 per cent. An investor can buy the stock for the target of 129 levels." Currently, the counter is revolving around Rs 75 per stock levels.
Buy Sobha Developers for 34% gains, advises HDFC Securities
Sobha reported Revenue/PAT miss/beat of 10/8%. EBITDA margin expanded by 31bps YoY to 20.2% (-57bps QoQ). Whilst presales picked up in Kochi project post the flood impact, the overall presales is still muted at 0.9mn sqft (-12% QoQ) as markets like NCR (-63% QoQ), Mysore (-18% QoQ) and more importantly Bengaluru (-13% QoQ) have posted weak numbers, despite it being a festive season. SDL highlighted that the dip is only temporary and the sales velocity should see an improvement (especially in Bengaluru). SDL continues to aim for minimal inventory in completed projects (currently ~0.2mn sqft). It is increasingly bullish on the Bengaluru market, and feels affordable housing will remain key focus area (with a near term launch targeted in South Bengaluru). Maintain BUY with TP of Rs 646/share.
On suggestion to investors in regard to SDL stock Parikshit D Kandpal, Analyst, HDFC Securities told, "The SDL fundamentals suggests an upside potential for 34 per cent. We recommend investors to buy SDL stock for the target of Rs 646/stock levels." The counter is urrently hovering around Rs 480/stock levels.
Buy Symphony for 37% gains, advises HDFC Securities
Symphony reported a weak but in-line performance in a non-seasonal quarter. It delivered around Rs 3bn domestic revenues over second and third quarter of FY19 (Rs 3.8bn YoY) despite heavy channel inventory and 2 consecutive weak seasons. This reassures the distributors’ faith in the franchise and air cooler category. Moreover, Symphony was able to maintain its core strength i.e. off-season sales against 100 per cent cash advances. The co maintained its unique business model and clocked more than 90 per cent market share (non-seasonal) during 3QFY19.
Naveen Trivedi, Analyst, HDFC Securities told Zee Business in a detailed research report citing, "The fundamentals of the stock suggests 37 per cent upside potential. We recommend invetors to buy the stock for target of Rs 1,682." Currently, the counter is oscillating around Rs 1220/share levels.
Looming global economic slowdown
The European Commission on Thursday sharply cut its forecasts for euro zone economic growth this year and next, stoking fears of a global slowdown spreading to Europe as businesses and investors grappled with trade frictions.
Adding to the gloomy mood, President Donald Trump said he did not plan to meet with Chinese President Xi Jinping before a March 1 deadline to achieve a trade deal.
That rattled investors hoping for a resolution to the months-long trade dispute between the world's biggest economies. Wall Street shares slumped in response overnight, with the Dow falling 0.9 per cent to pull back from a two-month peak scaled midweek on upbeat corporate results.
Weak Asian cues indicates bear run today
Asian stocks slipped on Friday as investors fretted about a broadening global economic slowdown, with sentiment not helped by the absence of any positive signs for a resolution in the US-China trade row.
Safe-haven government bonds benefited in the face of growing anxiety over the global outlook, with German long-term debt yields falling to their lowest in over two years.
MSCI's broadest index of Asia-Pacific shares outside Japan shed 0.3 per cent, easing back from a four-month peak touched the previous day. The index stood little changed on the week. Japan's Nikkei fell 1.2 per cent.