Market Outlook
May 04, 2018
Market Cues
Domestic Indices
Chg (%)
(Pts)
(Close)
Indian markets are likely to open negative tracking global indices and SGX Nifty.
BSE Sensex
(0.2)
(73)
35,103
U.S. Stocks staged a significant recovery attempt over the course of the trading day.
Nifty
(0.4)
(38)
10,680
The major averages pared their losses considerably before ending the session
Mid Cap
(1.2)
(194)
16,619
mixed. The Dow Jones ended on a flat note at 23,930 and the Nasdaq ended down
Small Cap
(0.8)
(154)
18,036
by 0.2 percent to 7,088.
Bankex
0.2
64
28,679
U.K. stocks recovered from early losses to trade marginally higher as higher
commodity prices helped lift mining and energy stocks and the pound weakened
Global Indices
Chg (%)
(Pts)
(Close)
slightly after the release of disappointing services sector data. The FTSE 100 was up
by 0.3% to end at 7,553.
Dow Jones
0.0
5
23,930
Nasdaq
(0.2)
(13)
7,088
On domestic front, Indian shares fell modestly, tracking weak global markets as the
FTSE
0.3
16
7,553
U.S. Federal Reserve signaled further gradual increases in the federal funds rate and
investors awaited the outcome of Sino-U.S. trade talks. The BSE Sensex ended on a
Nikkei
(0.2)
(35)
22,473
negative of 0.2% at 35,103.
Hang Seng
(1.3)
(411)
30,313
Shanghai Com
0.6
20
3,101
News Analysis
Honda volume jumps 18% in April, crosses 600,000 units mark
Advances / Declines
BSE
NSE
Detailed analysis on Pg2
Advances
784
533
Investor’s Ready Reckoner
Declines
1,918
1,291
Unchanged
119
77
Key Domestic & Global Indicators
Stock Watch: Latest investment recommendations on 150+ stocks
Volumes (` Cr)
Refer Pg5 onwards
BSE
3,525
Top Picks
NSE
32,232
CMP
Target
Upside
Company
Sector
Rating
(`)
(`)
(%)
Blue Star
Capital Goods Accumulate
786
867
10.3
Net Inflows (` Cr)
Net
Mtd
Ytd
Dewan Housing Finance
Financials
Accumulate
632
720
14.0
FII
(100)
(4,952)
8,655
Century Plyboards
Forest Product
Buy
308
400
30.0
*MFs
409
8,173
42,632
Navkar Corporation
Others
Buy
171
265
54.7
KEI Industries
Capital Goods Accumulate
427
485
13.6
More Top Picks on Pg4
Top Gainers
Price (`)
Chg (%)
Key Upcoming Events
51
9.8
Previous
Consensus
PCJEWELLER
121
9.8
Date
Region
Event Description
ReadingExpectations
MMTC
46
8.7
May 04, 2018 Germany PMI Services
54.10
54.10
May 04, 2018 US
Unnemployment rate
4.10
4.00
RAIN
322
4.8
May 04, 2018 US
Change in Nonfarm payrolls
103.00
192.00
MANAPPURAM
128
4.7
May 08, 2018 China
Exports YoY%
(2.70)
7.50
May 09, 2018 UK
Industrial Production (YoY)
2.20
Top Losers
Price (`)
Chg (%)
More Events on Pg7
HCC
18
-24.8
JETAIRWAYS
520
-12.3
INDIGO
1206
-10.6
HCLTECH
926
-7.5
HDIL
31
-6.5
As on May 03, 2018
Market Outlook
May 04, 2018
News Analysis
Honda volume jumps 18% in April, crosses 600,000 units mark
Second largest two-wheeler maker Honda Motorcycle and Scooter India (HMSI)
reported record volumes in April-crossing for the first time the 6-lakh units monthly
sales milestone. The company said its April volumes touched 681,888 units, a
growth of 18 per cent over the same month a year ago. The company had closed
FY18 with a 22 per cent sales growth crossing the 6 million mark, which was two
percentage points over its own target for the year. For the current year, the
company has not specified a volume growth target but said it expects to grow in
double digits.
The Japanese company also said its scooter sales crossed the 400,000 volume
mark for the first time in April notching up 423,527 units, which is 15 per cent
higher. Similarly, its bikes sales also crossed the 200,000 units mark helping it for
the first time overtake Bajaj Auto at 212,284, a growth of 16 per cent. On the
export front, too, the Honda set a new record by shipping out 70 per cent more
units at 46,077 units.
Economic and Political News
RBI asks listed firms to provide FPI data to depositories by May 15
Sebi puts in place risk management measures for derivatives segment
Corporate News
Flipkart buys back shares worth $350 million
Cognizant acquires Belgium-based analytics company Hedera Consulting
ArcelorMittal says may pay off dues of Uttam Galva as a 'goodwill gesture'
Google offers additional $3mn grants to support education in India
Market Outlook
May 04, 2018
Quarterly Bloomberg Brokers Consensus Estimate
ICICI Bank Ltd - May 07, 2018
Particulars ( ` cr)
4QFY18E
4QFY17
y-o-y (%)
3QFY18
q-o-q (%)
PAT
1061
2025
(47.6)
1650
(35.7)
Exide Industries Ltd - May 07, 2018
Particulars ( ` cr)
4QFY18E
4QFY17
y-o-y (%)
3QFY18
q-o-q (%)
Sales
2438
2225
9.6
2277
7.1
EBIDTA
319
262
21.8
283
12.7
%
13.1
11.8
12.4
PAT
185
165
12.1
154
20.1
Tata Chemical Ltd - May 07, 2018
Particulars ( ` cr)
4QFY18E
4QFY17
y-o-y (%)
3QFY18
q-o-q (%)
Sales
2959
2919
1.4
2574
15.0
EBIDTA
570
488
16.8
563
1.2
%
19.3
16.7
21.9
PAT
277
343
(19.2)
832
(66.7)
Market Outlook
May 04, 2018
Top Picks
Market Cap
CMP
Target
Upside
Company
Rationale
(` Cr)
(`)
(`)
(%)
Strong growth in domestic business due to its
leadership in acute therapeutic segment. Alkem
Alkem Laboratories
24,277
2,030
2,441
20.2
expects to launch more products in USA, which
bodes for its international business.
Favorable outlook for the AC industry to augur well
for Cooling products business which is out pacing
Blue Star
7,546
786
867
10.3
the market growth. EMPPAC division's profitability
to improve once operating environment turns
around.
With a focus on the low and medium income (LMI)
consumer segment, the company has increased its
Dewan Housing Finance
19,808
632
720
14.0
presence in tier-II & III cities where the growth
opportunity is immense.
Well capitalized with CAR of 18.1% which gives
sufficient room to grow asset base. Faster resolution
ICICI Bank
181,152
282
416
47.6
of NPA would reduce provision cost, which would
help to report better ROE.
High order book execution in EPC segment, rising
KEI Industries
3,346
427
485
13.6
B2C sales and higher exports to boost the revenues
and profitability
Expected to benefit from the lower capex
Music Broadcast Limited
2,148
376
475
26.2
requirement and 15 year long radio broadcast
licensing.
Massive capacity expansion along with rail
Navkar Corporation
2,578
171
265
54.7
advantage at ICD as well CFS augur well for the
company
Strong brands and distribution network would boost
Siyaram Silk Mills
3,092
660
851
29.0
growth going ahead. Stock currently trades at an
inexpensive valuation.
Market leadership in Hindi news genre and no. 2
viewership ranking in English news genre, exit from
TV Today Network
2,672
448
603
34.6
the radio business, and anticipated growth in ad
spends by corporate to benefit the stock.
After GST, the company is expected to see higher
volumes along with improving product mix. The
Maruti
264,506
8,756
10,619
21.3
Gujarat plant will also enable higher operating
leverage which will be margin accretive.
We expect loan book to grow at 24.3% over next
GIC Housing
2,232
414
655
58.0
two year; change in borrowing mix will help in NIM
improvement
We expect CPIL to report net Revenue/PAT CAGR of
~17%/16% over FY2017-20E mainly due to
Century Plyboards
6,836
308
400
30.0
healthy growth in plywood & lamination business,
forayed into MDF & Particle boards on back of
strong brand & distribution network.
We expect sales/PAT to grow at 13.5%/20% over
LT Foods
2,829
88
128
44.7
next two years on the back of strong distribution
network & addition of new products in portfolio.
Third largest brand play in luggage segment
Increased product offerings and improving
Safari Industries
1,422
639
750
17.4
distribution network is leading to strong growth in
business. Likely to post robust growth for next 3-4
years
We expect HSIL to report PAT CAGR of ~15% over
FY2017-20E owing to better improvement in
HSIL Ltd
2,697
373
510
36.7
operating margin due price hike in container glass
segment, turnaround in consumer business.
Source: Company, Angel Research
Market Outlook
May 04, 2018
Top Picks
Market Cap
CMP
Target
Upside
Company
Rationale
(` Cr)
(`)
(`)
(%)
We expect financialisation of savings and
Aditya Birla Capital
34875
159
230
44.7
increasing penetration in Insurance & Mutual fund
would ensure steady growth.
One of the leading Indian dairy products
companies in India created strong brands in dairy
products. Rising revenue share of high-margin
Parag Milk Foods
2,513
299
333
11.4
Value Added Products and reduction in interest cost
is likely to boost margins and earnings in next few
years.
We expect MCL to report net revenue CAGR of
~15% to ~`450cr over FY2018-20E mainly due to
strong growth in online matchmaking & marriage
Matrimony.com Ltd
1,839
810
984
21.5
related services. On the bottom-line front, we
expect a CAGR of ~28% to `82cr over the same
period on the back margin improvement.
HDFC Bank maintained its steady growth in the
4QFY18. The bank’s net profit grew by 20.3%.
Steady growth in interest income and other income
HDFC Bank
5,10,967
1,967
2,315
17.7
aided PAT growth. The Strong liability franchise
and healthy capitalisation provides strong earning
visibility. At the current market price, the bank is
trading at 3.2x FY20E ABV.
Source: Company, Angel Research
Fundamental Call
Market Cap
CMP
Target
Upside
Company
Rationale
(` Cr)
(`)
(`)
(%)
CCL is likely to maintain the strong growth trajectory
CCL Products
4,107
309
360
16.6
over FY18-20 backed by capacity expansion and
new geographical foray
We forecast Nilkamal to report top-line CAGR of
~9% to `2,635cr over FY17-20E on the back of
Nilkamal
2,507
1,680
2,178
29.6
healthy demand growth in plastic division. On the
bottom-line front, we estimate
~10% CAGR to
`162cr owing to improvement in volumes.
The prism has diversified exposure in the different
segment such as Cement, Tile & ready mix concrete.
Prism Cement
5,945
118
160
35.5
Thus we believe, PCL is in the right place to capture
ongoing government spending on affordable
housing and infrastructure projects.
Elantas Beck India is the Indian market leader in
liquid insulation segment used in electrical
equipments like motors, transformers etc. It derives
Elantas Beck India Ltd
1,769
2,231
2,500
12.0
demand from several industries which are expected
to register 10%+ CAGR in demand in the coming
years.
Greenply Industries Ltd (GIL) manufactures plywood
& allied products and medium density fibreboards
(MDF). GIL to report net revenue CAGR of ~14% to
Greenply Industries
3,749
306
395
29.2
~`2,478cr over FY2017-20E mainly due to healthy
growth in plywood & lamination business on the
back of strong brand and distribution network
GMM Pfaudler Limited (GMM) is the Indian market
leader in glass-lined (GL) steel equipment. GMM is
expected to cross CAGR 15%+ in revenue over the
GMM Pfaudler Ltd
1,133
775
861
11.1
next few years mainly led by uptick in demand from
user industries and it is also expecting to increase its
share of non-GL business to 50% by 2020.
Market Outlook
May 04, 2018
Key Upcoming Events
Result Calendar
Date
Company
May 04, 2018
Ambuja Cements, Bank of Maharashtra, Godrej Consumer, PVR, Elecon Engineering
May 07, 2018
Tata Chemicals, Exide Industries, ICICI Bank, Vijaya Bank, Visaka Industries
Source: Bloomberg, Angel Research
Global economic events release calendar
Bloomberg Data
Date
Time
Country
Event Description
Unit
Period
Last Reported
Estimated
May 04, 2018
1:25 PMGermany PMI Services
Value
Apr F
54.10
54.10
6:00 PMUS
Unnemployment rate
%
Apr
4.10
4.00
6:00 PMUS
Change in Nonfarm payrolls
Thousands
Apr
103.00
192.00
May 08, 2018
China
Exports YoY%
% Change
Apr
(2.70)
7.50
May 09, 2018
2:00 PMUK
Industrial Production (YoY)
% Change
Mar
2.20
May 10, 2018
US
Producer Price Index (mom)
% Change
Apr
0.20
6:00 PMUS
Consumer price index (mom)
% Change
Apr
(0.10)
0.30
7:00 AMChina
Consumer Price Index (YoY)
% Change
Apr
2.10
1.90
4:30 PMUK
BOE Announces rates
% Ratio
May 10
0.50
0.50
May 11, 2018
5:30 PMIndia
Industrial Production YoY
% Change
Mar
7.10
May 14, 2018
12:00 PMIndia
Monthly Wholesale Prices YoY%
% Change
Apr
2.47
May 15, 2018
2:30 PMEuro Zone Euro-Zone GDP s.a. (QoQ)
% Change
1Q P
0.40
2:00 PMUK
Jobless claims change
% Change
Apr
11.60
7:30 AMChina
Industrial Production (YoY)
% Change
Apr
6.00
6.50
India
Imports YoY%
% Change
Apr
7.15
Source: Bloomberg, Angel Research
Market Outlook
May 04, 2018
Macro watch
Exhibit 1: Quarterly GDP trends
Exhibit 2: IIP trends
(%)
(%)
8.5
10.0
9.0
9.1
7.4
9.0
8.0
7.1
7.1
8.0
8.1
7.0
7.6
7.6
8.0
7.3
7.2
7.2
6.0
6.8
4.8
7.0
6.5
5.0
4.1
6.1
5.7
4.0
3.2
6.0
2.9
3.0
1.8
5.0
2.0
1.0
4.0
1.0
-
3.0
(1.0)
(0.3)
Source: CSO, Angel Research
Source: MOSPI, Angel Research
Exhibit 3: Monthly CPI inflation trends
Exhibit 4: Manufacturing and services PMI
56.0
Mfg. PMI
Services PMI
(%)
6.0
54.0
5.2
5.1
4.9
52.0
5.0
4.4
4.3
50.0
4.0
3.6
3.3
3.3
3.0
48.0
3.0
2.4
2.2
46.0
2.0
1.5
44.0
1.0
42.0
40.0
-
Source: Market, Angel Research; Note: Level above 50 indicates expansion
Source: MOSPI, Angel Research
Exhibit 5: Exports and imports growth trends
Exhibit 6: Key policy rates
(%)
Exports yoy growth
Imports yoy growth
(%)
Repo rate
Reverse Repo rate
CRR
60.0
6.50
50.0
6.00
40.0
5.50
30.0
5.00
20.0
4.50
10.0
4.00
0.0
3.50
(10.0)
3.00
Source: Bloomberg, Angel Research
Source: RBI, Angel Research
Market Outlook
May 04, 2018
Global watch
Exhibit 1: Latest quarterly GDP Growth (%, yoy) across select developing and developed countries
(%)
8.0
6.9
7.0
5.8
6.0
5.3
5.0
5.0
1.1
3.7
4.0
2.5
3.0
2.2
1.8
2.0
1.5
1.4
0.8
1.0
0.3
-
Source: Bloomberg, Angel Research
Exhibit 2: 2017 GDP Growth projection by IMF (%, yoy) across select developing and developed countries
(%)
6.7
6.8
7.0
6.0
5.4
5.2
5.0
3.7
4.0
3.0
1.8
2.2
2.0
1.7
1.6
2.0
0.7
1.5
0.7
1.0
-
Source: IMF, Angel Research
Exhibit 3: One year forward P-E ratio across select developing and developed countries
(x)
25.0
20.0
15.0
10.0
5.0
-
Source: IMF, Angel Research as on 03 May, 2018
Market Outlook
May 04, 2018
Exhibit 4: Relative performance of indices across globe
Returns (%)
Country
Name of index
Closing price
1M
3M
1YR
Brazil
Bovespa
84,547
(1.0)
(1.2)
29.8
Russia
Micex
4,495
1.4
7.1
11.4
India
Nifty
10,718
4.6
(3.5)
14.8
China
Shanghai Composite
3,081
(0.7)
(11.4)
(2.3)
South Africa
Top 40
51,554
5.9
(6.5)
8.1
Mexico
Mexbol
47,810
3.7
(5.8)
(3.6)
Indonesia
LQ45
964
(8.4)
(15.4)
1.9
Malaysia
KLCI
1,852
(0.6)
(0.1)
5.5
Thailand
SET 50
1,186
0.6
(0.4)
19.4
USA
Dow Jones
23,925
1.2
(8.3)
14.2
UK
FTSE
7,543
6.9
(0.6)
3.4
Japan
Nikkei
22,473
4.7
(4.9)
19.1
Germany
DAX
12,802
5.5
(3.3)
0.9
France
CAC
5,529
6.7
0.7
2.2
Source: Bloomberg, Angel Research as on 03 May, 2018 68in4
Market Outlook
May 04, 2018
Exhibit 7: Historical Angel Top Picks/Fundamental Calls
IC Date
Top Picks/Fundamental
Stocks
Open/Closed
02-05-2018
Top Picks
HDFC Bank
Open
20-04-2018
Top Picks
Matrimony.com Ltd
Open
16-04-2018
Top Picks
Parag Milk Foods Limited
Open
06-04-2018
Fundamental
GMM Pfaudler Limited
Open
07-03-2018
Ashok Leyland Ltd
Closed (26/04/2018)
03-03-2018
Fundamental
Greenply Industries
Open
21-02-2018
Top Picks
Safari Industries
Open
16-02-2018
Top Picks
HSIL Ltd
Open
07-02-2018
Fundamental
Elantas Beck India Ltd.
Open
01-02-2018
Top Picks
ICICI Bank
Open
01-02-2018
Top Picks
Aditya Birla Capital
Open
04-01-2018
Fundamental
CCL Products
Open
03-01-2018
Fundamental
Nilkamal Ltd
Open
01-01-2018
Capital First Ltd
Closed (15/01/2018)
30-12-2017
Shreyans Industries Ltd
Closed
21-12-2017
Fundamental
Prism Cement Ltd
Open
18-12-2017
Menon Bearings Limited
Closed (17/01/2018)
14-12-2017
Ruchira Papers Ltd.
Closed (09/02/2018)
28-11-2017
Top Picks
Century Plyboards India
Open
06-11-2017
Top Picks
LT Foods
Open
16-10-2017
Endurance Technologies Ltd
Closed (01/12/2017)
11-Sep-17
Top Picks
GIC Housing
Open
20-07-2017
Top Picks
Music Broadcast Limited
Open
07-07-2017
L&T Finance Holdings Ltd
Closed (28/8/2017)
06-07-2017
Syngene International
Closed (1/3/2018)
05-07-2017
Top Picks
Maruti
Open
03-01-2017
Top Picks
Alkem Lab
Open
30-12-2016
Top Picks
KEI Industries
Open
04-08-2016
Top Picks
TV Today Network
Open
05-04-2016
Top Picks
DHFL
Open
05-01-2016
Top Picks
Navkar Corporation
Open
08-12-2015
Top Picks
Blue Star
Open
06-11-2015
Top Picks
Siyaram Silk Mills
Open
Source: Company, Angel Research
Market Outlook
May 04, 2018
Research Team Tel: 022 - 39357800
DISCLAIMER
Angel Broking Private Limited (hereinafter referred to as “Angel”) is a registered Member of National Stock Exchange of India
Limited,Bombay Stock Exchange Limited and Metropolitan Stock Exchange Limited. It is also registered as a Depository Participant with
CDSL and Portfolio Manager with SEBI. It also has registration with AMFI as a Mutual Fund Distributor. Angel Broking Private Limited is
a registered entity with SEBI for Research Analyst in terms of SEBI (Research Analyst) Regulations, 2014 vide registration number
INH000000164. Angel or its associates has not been debarred/ suspended by SEBI or any other regulatory authority for accessing
/dealing in securities Market. Angel or its associates/analyst has not received any compensation / managed or co-managed public
offering of securities of the company covered by Analyst during the past twelve months.
This document is solely for the personal information of the recipient, and must not be singularly used as the basis of any investment
decision. Nothing in this document should be construed as investment or financial advice. Each recipient of this document should
make such investigations as they deem necessary to arrive at an independent evaluation of an investment in the securities of the
companies referred to in this document (including the merits and risks involved), and should consult their own advisors to determine
the merits and risks of such an investment.
Reports based on technical and derivative analysis center on studying charts of a stock's price movement, outstanding positions and
trading volume, as opposed to focusing on a company's fundamentals and, as such, may not match with a report on a company's
fundamentals. Investors are advised to refer the Fundamental and Technical Research Reports available on our website to evaluate the
contrary view, if any.
The information in this document has been printed on the basis of publicly available information, internal data and other reliable
sources believed to be true, but we do not represent that it is accurate or complete and it should not be relied on as such, as this
document is for general guidance only. Angel Broking Pvt. Limited or any of its affiliates/ group companies shall not be in any way
responsible for any loss or damage that may arise to any person from any inadvertent error in the information contained in this report.
Angel Broking Pvt. Limited has not independently verified all the information contained within this document. Accordingly, we cannot
testify, nor make any representation or warranty, express or implied, to the accuracy, contents or data contained within this document.
While Angel Broking Pvt. Limited endeavors to update on a reasonable basis the information discussed in this material, there may be
regulatory, compliance, or other reasons that prevent us from doing so.
This document is being supplied to you solely for your information, and its contents, information or data may not be reproduced,
redistributed or passed on, directly or indirectly.
Neither Angel Broking Pvt. Limited, nor its directors, employees or affiliates shall be liable for any loss or damage that may arise from
or in connection with the use of this information.
