Sensex tanks 119 points, Nifty below 10,800; all sectors close weak except IT
On account of ease in Sino-US trade talks Indian indices dipped by over 0.3 a per cent. The BSE Sensex closed 119.51 points negative to 36,034.11 while the 50-stock Nifty index tanked 37.75 points to 10,793 mark at the closing on Wednesday. Except telecom and realty, all sectoral indices were in the green zone. US President Donald Trump had said on Tuesday that he could see letting the March 1 deadline for reaching a trade agreement with China slide a little if the two sides were close to a complete deal.
Speaking on the market outlook Simi Bhaumik, a SEBI registered technical equity analyst told Zee Business online, "In my view, the market is trading range-bound between 10,800 to 11,200. The breaking of any levels would be the decider about a bull or a bear run at the Indian indices."
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Accumulate Britannia Industries for 12% gains, advises Elara Securities
Britannia reported Net sales at Rs 28.4bn (3.9% lower than EE), up 10.7% YoY led by volume growth of 7% YoY which was lower than our/street’s expectation of +10% YoY led by slowdown in both urban and rural wholesale channel (30% of sales) post Diwali. Price hike and premiumisation led growth was +1.5% each. Gross margin expanded by 261.5bps YoY/130bps QoQ to 41.3% led by strategic sourcing of wheat & by procuring raw material for bread on behalf of contract manufacturer instead of buying FG. It has maintained a guidance of double digit value growth going forward as they have already seen the revival in wholesale channel in Jan’19. With 3-4% price hike flowing through from 4QFY19 onwards, experts believe BRIT should be able to clock at least 15% sales/ 19% EBITDA growth in FY19-21e period.
On what should be the suggestion for the market investors in regard to Britannia Industries counter Sagarika Mukherjee, Analyst at Elara Securities told, "The counter has a potential of upside swing of near 12 per cent. We recommend investors to accumulate and book profit at around Rs 3,478/stock levels." Currently, the stock is hovering around Rs 3,108/counter levels.
Buy Apollo Hospitals Enterprise for 35% gains, advises Elara Securities
Apollo Hospitals Enterprise EBITDA of Rs 2.7bn, up 21% YoY and 4% QoQ, was ahead of our estimates, given improving profitability in new hospitals and reducing losses in Apollo Health & Lifestyle (AHLL). Further, mature hospitals posted EBITDA growth of 16% YoY and continued margin expansion in the pharmacy business. OPM was up 100bp YoY to 11.1% while PAT was up 25% YoY to Rs 547mn. Standalone revenue was up 17% YoY at Rs 21.7bn, led by healthcare services, up 16% YoY, while standalone pharmacy growth remains strong at 18% YoY. Standalone EBITDA was up 21% YoY to Rs 2.7bn. Net debt increased by Rs 420mn QoQ to Rs 32.6bn.
On suggestion for the market investors in regard to the Apollo Hospitals counter Param Desai, Analyst at Elara Securities informed in a detail research report, "The fundamentals of the counter suggests and upside potential of 35 per cent. An investor can buy the stock for the target of Rs 1,515/stock levels." Currently, the stock is oscillating around Rs 1,122/counter levels.
9: 51 AM
Buy SpiceJet Limited for 36% gains, advises SBICAP Securities
SpiceJet’s (SJ) Q3FY19 revenue trajectory was akin to that of its peers – YoY improvement in yields (by 3.2%) at the cost of PLF (340bps down). Further supporting RASK (up 3% YoY) was the upfront cash incentives booked on inducting aircraft, which is expected to continue, going ahead. However, elevated cost pressure (fuel CASK up around 32%/maintainence cost up 12%) resulted in PAT declining 77% YoY to Rs550mn (SSLe Rs649mn). Delivery of fuel-efficient Max aircraft, which is expected to improve overall operating economics of the aircraft by 8-9%, has commenced – 10 in a fleet of 74. However, it is still early days to gauge the benefits of this, and performance in Q4FY19/Q1FY20 will be key. Return of pricing discipline coupled with cost-reduction measures should drive improvement in profitability.
On suggestion for the investors in regard to this counter Santosh Hiredesai, Analyst at SBICAP Securities informed in a detailed research study that suggests that the counter is poised for an upside of near 36 per cent. "An investor can think of taking a buy position in the scrip for the target of Rs 109/stock." Currently, the stock is oscillating around Rs 80/counter levels.
Buy Eicher Motors Limited for 10% gains, advises Narnolia Financial Advisors
The margins of the company slipped for second straight quarter by 130bps on a sequential basis due to higher launch cost on 650cc twins, addition of new stores and weaker operating leverage. The demand scenario in the domestic market continues to be challenging due to increased ownership cost and Kerala flood situation (30% market share). The management has also reduced its production guidance to 8.7 lakh units from 9.5 lakh units for FY19. However the 650 twins have a waiting period of 5-6 months against 4-5 weeks for Thunderbird X and Classic 350. The management is constantly increasing its dealer network in order to have strong hold in the domestic market. Experts are expecting that Jawa motorcycles can be a potential threat to Royal Enfield and snatch good chunk of market share as it has already stopped bookings till September 2019 because of strong demand. International business remains a primary focus area as the company is investing consistently on network expansion, promotional and brand building activities in key export markets.
On suggestion for the investors in regard to this counter Naveen Kumar Dubey, Research analyst at Narnolia Financial Advisors informed Zee Business Online in a detailed research report that suggests that the Eicher Motors scrip has a potential for an upside swing of near 10 per cent. "An investor can buy the counter for the target of Rs 22,734/stok." Currently, the stock is oscilllating around Rs 20,675/counter levels.
FMCG follow shoot
The FMCG index rose over 1 per cent in early trade session on Wednesday. The FMCG major ADF Foods rose over 2 per cent, Balrampur Chini Mills counter surge over 3 per cent, Chaman Lal Setia Exports was up by around 2.85 per cent, Britannia stocks were up by more than half a per cent, Dhampur Sugar Mills stocks were up by more than 2.5 per cent, Everyday Industries India stocks were up by around 1.9 per cent.ITC stocks rose by around 2.3 per cent, Jay Shree Tea and Industries shares went northward by around 1.25 per cent, Kwality shares were up by around 4.95 per cent.
Healthcare sector lead the rally at Dalal Street
Healthcare index logged around 0.75 per cent gains in early morning trade session. Healthcare major Alkem lab rose by over 1.5 per cent, Apollo Hospitals stock was up by around 1.35 per cent, Dr Lal pathlab stocks rose by over 2 per cent, Novartis stock also rose by near 0.9 per cent, Sun Pharma Advanced Research company stock rose near 3.9 per cent while Sun Pharma Industries stocks rose by 3.7 per cent.STocks of Thyrocare Tech and Vivimed Labs too went northward by more than 1 per cent.
Healthcare, FMCG and Infrastructure lead the rally
Healthcare, FMCG and Infrastructure sector was the major gainer in early session trade. Healthcare index rose by near 0.75 per cent while FMCG and Infra index went up by around 0.7 per cent and 0.6 per cent respectively.
Markets Up in pre-open session
The BSE Sensex surged 126 points to 36,279 levels while Nifty rose 39 points to 10,870 mark in pre-open session
Asian stocks surge on US-china talks
Asian stocks edged up to a more than four-month high on Wednesday, lifted by optimism that the United States and China might be able to hammer out a deal to resolve their nearly year-long trade dispute.
MSCI's broadest index of Asia-Pacific shares outside Japan rose as much as 0.5 per cent to hit its highest level since early October.
Japan's Nikkei average climbed 1.3 per cent to mark an eight-week high, while South Korea's KOSPI gained 0.5 per cent.
China's benchmark Shanghai Composite and the blue-chip CSI 300 advanced 0.4 per cent and 0.6 per cent, respectively, and Hong Kong`s Hang Seng was up 0.6 per cent.
Asia took its cue from Wall Street, where the Dow and Nasdaq each rallied about 1.5 per cent overnight on optimism over US-China trade negotiations and a tentative US congressional spending deal to avert another partial government shutdown.