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9am with Emkay |
n Dealer Comments
The markets started the day’s session on a very positive note with 140 odd points upward gap led by positive cues from the world markets particularly the Asian counterparts which were trading almost 1% higher. After a very long time markets witnessed substantial bouts of volatility almost throughout the day. After a very firm opening markets pared all of the initial gains and dipped almost 220 odd points in early morning trades led by heavy selling in the banking space post news of exposure to micro finance companies to the tune of Rs 7000 crores. Post noon indices traded in a very narrow range around the dotted lines and finally inched winner aided by strong trading by the European markets and firm closing by the Asian markets. After an extremely volatile session finally the markets managed to close the day on a positive note towards the end with Sensex gaining 65 points or 0.33% higher to settle at 19931 levels while Nifty gained a mere 10 points or 0.17% higher to settle at 5998 levels. The overall traded volumes were higher compared to the earlier day by almost 18% and were at Rs 2411 bn. While delivery based volumes were lower compared to the earlier day at 38.8% of the total traded turnover. Among the Fund activities FII’s were net sellers to the tune of Rs 0.55 bn on 16th November 2010. While on 18th November 2010, FII’s sold shares worth Rs. 4.53 bn in cash segment (provisional) while in the F&O segment they were net sellers to the tune of Rs 15.57 bn whereas Domestic Funds bought shares worth Rs. 1.18 bn (provisional).
Above 55-DEMA
After seeing a terrific recovery of 100 odd points from the day low, Nifty finally ended with a gain of 10 points. Moreover, today’s move was a selling climax, whereby the prices are expected to rise from hereon. Also after minor whipsawing Nifty managed to close within the bullish channel as well as above its 55-DEMA. Furthermore, the hourly MACD cycle of Nifty has turned bullish, after completing a Flat correction on minute degree. So on the whole the view remains bullish for the target of 6200.
BSE Capital Goods:
After minor whipsawing BSE Capital Goods index has managed to find support at the lower boundary of the bullish channel (Grey one) and now we are looking for targets in range of 16,050-16,200.
Himadri reports weak operating performance in Q2FY11 - APAT growth at 2.5% yoy to Rs0.3 bn
n Himadri reported weak performance in Q2FY11 - revenue growth at 51% yoy to Rs1.8 bn, Ebidta growth at 2.7% yoy to Rs0.5 bn and APAT growth at 2.5% yoy to Rs0.3 bn.
n Sharp reduction in Ebidta margins was witnessed in Q2FY11 - led by (1) yoy base effect in material costs, lower priced material in Q2FY10 (2) dependence on grid power, owing to shutdown of waste heat power plant and (3) lower sales of Napthalene, owing to capacity rebalancing
n Company would draw power from grid until January 2011, thereby earning lower Ebidta per ton
n Himadri commenced production in 80,000 MTPA coal-tar distillation capacity in Q2FY11- the capacity has already achived 95% utilization in November 2010
n Expansion plans remains unchanged, so does the commitment levels. Himadri is moving ahead with (1) greenfield CTP capacity in India - 150,000 MTPA (2) carbon black expansion from 50,000 MTPA to 100,000 MTPA (3) SNF expansion from 18,000 MTPA to 78,000 MTPA and (4) 12 MW waste heat power plant.
n Further, Himadri sounds reasonably confident on the China expansion of 100,000 MTPA, though not factored in our earnings estimates.
n Our earnings estimates for FY11E and FY12E are Rs33.3/Share and Rs45.2/Share. Himadri fully discounts its FY12E earnings at 14X, leaving no scope for negative surprise.
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