31 March 2011

India Morning Meeting Notes | 31 M arch 2011 :: RBS

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News headlines
Oil & Gas
􀀟 'ONGC's consent needed in Cairn-Vedanta deal' (Economic Times)
􀀟 Lower D6 output may choke gas supply to steel firms, refineries (Business Standard)
􀀟 Ministry nod to BP-RIL deal shortly (Live Mint)
Banks
􀀟 HDFC Bank opens 275 branches this fiscal (Economic Times)
􀀟 Bhatt takes on RBI, says it never understood SBI teaser loans (Economic Times)
􀀟 OBC gets Rs17.4bn from centre (Business Standard)
􀀟 SBI to manage EPFO's Rs3,000bn fund until June 30 (Business Standard)
􀀟 Axis Bank to open 22 branches in TN (Business Standard)
􀀟 Banks in AP fall short of credit targets (Business Standard)
Pharma
􀀟 Aurobindo gets USFDA nod to market Galantamine tablets (Economic Times)
􀀟 Dr Reddy's acquires GSK's US penicillin facility (Economic Times)
􀀟 EU countries clear water for Indian pharma firms to anchor (Business Standard)
􀀟 Intas Pharma plans expansion of manufacturing facilities (Business Standard)
Commodity
􀀟 Government to award small coal blocks to companies of host states (Economic Times)
􀀟 Nalco may hike aluminium prices by Rs2,000-3,000/tonne in April (Economic Times)
􀀟 Sebi clears Sesa Goa open offer for Cairn India (Economic Times)
􀀟 Hindalco’s Aditya Aluminium to raise Rs 80bn, Mahan closes fund raising (Economic Times)
Consumer
􀀟 Ice cream set to cost more on higher tax (Economic Times)
Retail/ Real Estate
􀀟 Citibank India set to seal Rs10bn office deal in Mumbai (Economic Times)
IT & Telecom
􀀟 Stuxnet attack fear pushes government to check IT network (Economic Times)
􀀟 Microsoft working on new software for mobile payments (Economic Times)
􀀟 Cognizant poses challenge to Infosys, TCS in retail (Economic Times)
􀀟 iGate open offer for Patni Computer Systems shares to start April 8 (Economic Times)
􀀟 Broadband policy to be sent to cabinet soon (Economic Times)
􀀟 Armed forces object to spectrum allocation plan (Economic Times)
􀀟 TRAI to bring out paper on mobile VAS in April (Economic Times)
􀀟 Concerned about security related allegations: Etisalat (Economic Times)
􀀟 Sistema Shyam allots shares to Russian govt (Business Standard)

Power, engineering & infrastructure
􀀟 Govt plans Rs100,000 per day fine for missing energy saving target (Economic Times)
􀀟 Fernas Construction India bags Rs3bn order for IOC pipeline project (Economic Times)
􀀟 Engineering exports cross $50bn mark in April-February (Economic Times)
􀀟 BHEL bags Rs54.5bn order from Bajaj group company (Economic Times)
􀀟 Power tariff hiked in Andhra Pradesh (Business Standard)
􀀟 THDC commissions Koteshwar dam (Business Standard)
Automobiles
􀀟 Japan calamity unlikely to impact India’s auto production (IBN Live)
􀀟 Auto cos hit as Maha rolls back tax sop (Times of India)
􀀟 Auto Expo – 2011 from April 8 (Times of India)

Anand Rathi- Top Picks 2011: March 2011 UPDATE

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Techcheck Daily -Changing Realty :: Emkay

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Techcheck Daily
Changing Realty

n     Chart in Focus: BSE Realty Index, prices have corrected 80% of the 2009 bull market, pattern supports along with very decent monthly setups hint at resumption of the uptrend, initial targets are pegged at the 200 DEMA around 2850, which is a good 25% away from current levels. DLF, HDIL and IBREAL remain top picks
n     Nifty, monthly setups play out in copybook fashion, monthly mean reversions look complete and should have multi month positive impact, moreover the current breakout reminds us of March 2009
n     Our preferred long term wave markings suggest that 5348 is a high probability long term bottom and a fresh move up would target all time highs(2008) at 6357
n     Crude continues to struggle around the 61.8% ($104) of the 2008 bear market and looks vulnerable, psychological $100 mark critical support from hereon
n     Gold too looks vulnerable, crucial monthly, quarterly close ahead, $1419 remains the trend decider for next few months
n     Stocks with positive short term view
n     OMC’s, Infosys, PNB, BOB, DLF, HDIL, IBReal, Sesa Goa, BHEL, LIC Hsg (stop 216), Tech Mahindra
n     Stocks with negative short term view
n     ACC, Aurobindo Pharma  
  

Yields remain steady amidst thin volumes ahead of the year end -Edelweiss,

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Yields remain steady amidst thin volumes ahead of the year end
Government securities
 Sovereign bonds traded in a narrow range, amidst thin volumes, as participants
avoided taking any big positions towards the end of the financial year. Volumes on
the central bank’s trading platform were at INR38bn compared to INR 62bn on
Tuesday. Banks typically avoid big transaction in the run up to the year-end as
such transaction may alter the liquidity and capital position of the bank. Fresh
supply of sovereign bonds in the next week prompted some traders to trim their
holdings. The most actively traded 8.13% 2022 bond closed 3bps higher at 8.07%
while the benchmark ten year bond closed at 8.01%.
Non-SLR market
 Issuance of CDs slipped as most banks slowed down after mopping up huge
amounts in the last few weeks to meet their year-end deposit base target. In
March, banks have raised INR 780bn through CD issuance in order roll over their
maturing CDs & increase their deposit base. Three month CDs were quoted at
9.55%-9.60% while one year CDs were quoted at 9.65%-9.75%
 Bank of India & PNB placed INR 5bn & INR 4bn respectively of three month CD at
9.55% while State Bank of Mysore placed INR 2bn of three month CD at 9.55%.
UCO Bank & Bank of Maharashtra placed INR 20bn & INR 5bn of three month CD
at 9.65%.
Money markets
 Overnight rates remained steady above the central bank’s repo lending rate. Banks
borrowed INR 869bn from the LAF window compared to INR 909bn on Tuesday.

Initiating Coverage report on Havell’s India Ltd.:: keynote

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Initiating Coverage report on Havell’s India Ltd.

Havell's India Ltd. (HIL), promoted by Qimat Rai Gupta incorporated in 1971 operates in various verticals of electrical equipment segment in India.HIL has manufactured wide range of products such as Building Circuit Protection, Industrial & Domestic Switchgear, Cables & Wires, Energy Meters, Fans, Compact Fluorescent Lamps (CFL) Lamps, Luminaries for Domestic, Commercial & Industrial applications and Modular switches.HIL has adopted inorganic growth by successful acquisition of Sylvania (2007) and Standard Electricals (2009). HIL enjoys a leading position in the electrical consumer market with the large product basket, strong brand name and wide spread distribution network. We expect, HIL to demonstrate a revenue and PAT CAGR of 12% & 74% respectively during FY10-13E.

Angel Broking, Aurobindo Pharma receives USFDA approval for Galantamine tablets

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Aurobindo Pharma receives USFDA approval for Galantamine tablets
Aurobindo Pharma received final approval from the USFDA to manufacture and market
Galantamine tablets (strengths of 4mg, 8mg and 12mg), generic version of Razadyne. The
product is used in the treatment of mild to moderate dementia of the Alzheimer's type. The
product has a market size of approximately US$41mn for the 12 months ending
September 2010, according to IMS, and will be launched shortly. The stock is currently
trading at 9.4x and 9.6x its FY2011E and FY2012E earnings, respectively. We maintain
Buy on the stock with a target price of `210.

Buzzing Stocks - Keynote Capitals (March-31-'11

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Buzzing Stocks
·      SEBI clears Sesa Goa open offer for Cairn India.
·      CBI is likely to charge-sheet three officials of ADAG and Unitech senior executives.
·      Andhra Pradesh HC tells Mahindra Satyam to pay CBDT of `3.5bn.
·      BHEL has bagged `54.50bn order from Bajaj Hindustan unit for setting up a thermal plant in Uttar Pradesh.
·      Dr Reddy’s Labs completes acquisition of GSK’s penicillin facility in US.
·      MOIL is scouting for technology partners to secure superior underground mining techniques to achieve its long-term production.
·      PTC India Financial services to disburse `12bn loan in 2011-12 FY.
·      Deepak Fertilizers to set up manufacturing plant in Australia with an investment of `15bn.
·      Aurobindo Pharma gets US FDA nod for dementia drug.
·      Nalco may raise aluminium prices by `2,000-3,000 a ton with effect from April.

Angel Broking, News Update: March 31, 2011

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Economic and Political News
􀂄 Coal Ministry to create taskforce for clean coal technology
􀂄 Engineering exports cross US$50bn mark in April 2010–February 2011
􀂄 Government may roll back excise duty on branded garments
􀂄 India iron ore exports fall for the 8th month
Corporate News
􀂄 Apollo Tyres to hike prices by 6% from April 2011
􀂄 iGate open offer for Patni shares to start on April 8
􀂄 IOC to shut kerosene unit from mid-April
􀂄 Nalco may hike aluminium prices by `2,000–3,000/tonne
􀂄 OBC gets `1,740cr fund infusion from the government
Source: Economic Times, Business Standard, Business Line, Financial Express, Mint

News (click on link to read article) : 31 March 2011: IFCI research

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News (click on link to read article)
Economic Times

Business Standard

Business Line
Mint
Financial Express

DNA Money


March 31, 2011 Edelweiss Technical Reflection (ETR)

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Edelweiss Technical Reflection (ETR)
§  The buying activity in the Indian markets seems relentless as the Nifty stretches its winning streak for the seventh session in a row, previously seen in October-November 2010. The index has closed at striking distance from 5800, which should be achieved in today’s session.  Hourly momentum indicators as well as the daily Stochastic Oscillator (5,3,3) have triggered a sell signal which could keep substantial gains in check. Market breadth improved strongly in yesterday as mid / small cap stocks will be in focus on financial year end activity. Nifty 50 stocks A/D ratio ended firm at 3:1. As we approach the final session of the March series derivatives expiry, volatility should be high. The markets are firmly on course to achieve 61.8% retracement (5900) of the November-February correction which will offer best opportunity to take profits and initiate some speculative shorts.
§  Barring the FMCG stocks, trend among the other sectoral indices was upbeat. Realty shares were in the limelight notching up >3% gains, followed by firm trend in Healthcare and Banking stocks. BSE Midcap index has achieved the downward sloping trend line breakout of 6800 which will now propel it towards 7175.
§  Bullish Setups: Dr Reddys (DRRD), Power Grid (PWGR), SESA, ADE, HCC
§  Bearish Setups: Tech Mahindra (TECHM), TRE, TGBL
§  US markets have resumed the northward journey after a day of pit-stop. DXY has formed a ‘Piercing Line’ candlestick pattern on the weekly chart indicating upside risk towards 77.40 in the near-term.