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Contents
n Dealer Comments
The markets started the day’s session on a very optimistic note with almost 160 odd point’s upward gap led by strong cues from the world markets particularly the Asian counterparts. Post firm opening by the indices markets continued to gather steam till almost the closing bells with intermittent bouts of small knee jerk correction. Markets are keenly awaiting the crucial announcement of the second round of quantitative easing by the UD Fed today in the evening which will decide the short term trend of the markets. Even today markets witnessed consistent buying in the banking space in anticipation of pick up in the credit offtake in a buoyant Indian economy. Today’s limelight was hogged by extremely good buying interest in the fertilizer shares in anticipation of a liberal urea policy announcement. Besides buying was also seen in auto, metal and select realty stocks after a brief correction post RBI’s policy announcement yesterday. Coal India ’s listing on Thursday might see the stock listing at around 280-290 levels and those who got less allotment may buy post tomorrows listing from the open market The overall traded volumes were once again marginally lower compared to the earlier day and were at Rs 991 bn. While delivery based volumes, remained flattish compared to the earlier day at 40.9% of the total traded turnover. Among the Fund activities FII’s were net buyers to the tune of Rs 5.66 bn while Domestic Funds were net also buyers to the tune of Rs 0.17 bn respectively on 2nd November 2010. While on 3rd November 2010, FII’s bought shares worth Rs. 9.88 bn in cash segment (provisional) while in the F&O segment they were net buyers to the tune of Rs 5.71 bn whereas Domestic Funds sold shares worth Rs. 3.71 bn (provisional).
n Technical Comments
6170 remains the crucial hurdle.
The session saw the benchmark whipsawing the 6170 resistance level but closing below it towards the later half of the day. The daily ranges to remain narrow and candle patterns don’t seem encouraging. Nevertheless daily momentum cycles look complete and remain the silver lining; once prices close past 6170 expect momentum to pick up further, till than expect range bound moves between the 21 DEMA at 6070-6182 (session high).
Bank Nifty:
The index has broken past previous high at 12827 and managed to close above that. The prices have also held past the 21 DEMA at 12430 and the daily momentum cycles look complete, this hints at further upsides. The white upper channel lines and the yellow resistance line have converged around the 13500 and is the nest target, 12430 on closing basis is the reversal for the view.
n Results Today
Engineers India | ICSA (India) | Jubilant Food. | Karuturi Global | Videocon Inds. |
n Research Update Included
Essel Propack Q2FY11 Result Update; Target Rs1.0 bn, Maintain BUY; Target: Rs 76
n Essel Propack (EPL) reports good performance in Q2FY11 – revenue growth at 19.8% yoy to Rs3.7 bn and APAT growth at 160% yoy to Rs206 mn
n EPL reports Ebidta margins at 18.5%, highest in last 16 quarters and since EPL goes international
n Progress in various geographies was on expected lines –with Amesa and EAP reported strong traction in the quarter and Americas and Europe reporting reduction of Ebit loss
n Maintain earnings of Rs3.9/Share and Rs6.3/share, Maintain BUY with target price of Rs76/Share
Blue Star Q2FY11 Result Update; Margins spoil show; Maintain ACCUMULATE; Target: Rs543
n Blue Star reported better than expected revenues of Rs6.9bn in Q2FY11 driven by higher revenues in PEIS division. However, lower margins in other businesses spoil the show
n EBIT margins in EMP and Cooling Products decline190bps yoy each – along with high interest cost and taxation, PAT decline by 12.6% yoy to Rs386 mn
n Order inflows up 8.4% yoy to Rs7.2 bn and order book up 10.1% yoy to Rs20.0 bn - expect order inflows to grow at 20% in H2FY11
n Maintain earnings estimates of Rs25.0/Share and Rs29.6/Share for FY11E and FY12E – Maintain positive bias with ACCUMULATE rating and target price Rs543/Share
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