Market Outlook
February 08, 2018
Market Cues
Domestic Indices
Chg (%)
(Pts)
(Close)
Indian markets are likely to open positive tracking global indices and SGX Nifty.
BSE Sensex
(0.3)
(113)
34,083
US stocks tumbled in the final hour of trading to finish near the unchanged line,
Nifty
(0.2)
(22)
10,477
as markets remained skittish after Monday's crash.The Dow Jones ended on
Mid Cap
0.4
70
16,351
downside front of 0.1% to close at 24,893 and the Nasdaq Composite edged down
Small Cap
2.0
340
17,732
to 0.9%, to 7,052.
Bankex
(0.4)
(125)
29,072
U.K. shares edged higher after the U.S. markets recovered from an early plunge to
finish sharply higher overnight. The FTSE 100 was up by 1.9% to close at 7,279.
Global Indices
Chg (%)
(Pts)
(Close)
Dow Jones
(0.1)
(19)
24,893
On domestic front, Indian shares closed lower for the seventh straight session as
Nasdaq
(0.9)
(64)
7,052
global sentiment changed from unbridled optimism to skepticism and the RBI
warned of higher government spending feeding into inflation after keeping interest
FTSE
1.9
138
7,279
rates unchanged for a third straight meeting, as widely expected. The Sensex ended
Nikkei
0.2
46
21,692
on a downside front of 0.3% at 34,083 while the Nifty ended at 10,477 with a
Hang Seng
0.8
242
30,565
downside of 0.2%.
Shanghai Com
(0.8)
(26)
3,283
News Analysis
Advances / Declines
BSE
NSE
YES Bank raises Rs 38.47bn for five-year tenor through global bonds
Advances
2,028
1,387
Detailed analysis on Pg2
Declines
767
402
Investor’s Ready Reckoner
Unchanged
92
48
Key Domestic & Global Indicators
Stock Watch: Latest investment recommendations on 150+ stocks
Volumes (` Cr)
Refer Pg5 onwards
BSE
4,396
NSE
33,746
Top Picks
CMP
Target
Upside
Company
Sector
Rating
(`)
(`)
(%)
Net Inflows (` Cr)
Net
Mtd
Ytd
Blue Star
Capital Goods
Buy
732
867
18.5
FII
(1,718)
(346)
12,638
Dewan Housing Finance
Financials
Buy
500
712
42.3
Asian Granito
Other
Buy
507
651
28.5
*MFs
1,312
950
8,336
Navkar Corporation
Other
Buy
172
265
53.9
KEI Industries
Capital Goods Accumulate
390
436
11.9
Top Gainers
Price (`)
Chg (%)
More Top Picks on Pg4
Centuryply
338
15.2
Key Upcoming Events
Chamblfert
158
11.8
Previous
Consensus
Date
Region
Event Description
Rain
362
9.6
Reading
Expectations
Lti
1,294
9.2
Feb08
India
RBI Cash Reserve ratio
4.00
4.00
Feb08
China
Exports YoY%
10.90
10.70
Bajajelec
487
9.0
Feb08
China
Consumer Price Index (YoY)
1.80
1.50
Feb09
UK
BOE Announces rates
0.50
0.50
Top Losers
Price (`)
Chg (%)
Feb09
UK
Industrial Production (YoY)
2.50
0.30
More Events on Pg7
Natcopharm
831
(8.1)
Vakrangee
203
(5.0)
Redington
140
(4.5)
Ubl
1,080
(4.2)
Bayercrop
3,930
(3.9)
As on February 07 2018
Market Outlook
February 08, 2018
News Analysis
YES Bank raises Rs 38.47bn for five-year tenor through global bonds
Private sector lender Yes Bank has raised $600 million (over Rs 38.47 billion) by
issuing bonds in the international debt markets. The bonds will be listed on the
London Stock Exchange International Securities Market (LSE ISM), the Singapore
Exchange Securities Trading SGX, and the India International Exchange IFSC at
GIFT City, Gandhinagar.
The bond issuance is aligned to government's commitment of building a high-tech
financial hub in the country. The bond is rated Baa3 by Moody's Investors Service
and has tenor of 5 years
Economic and Political News
India's tea exports hit 36-year high, reach at 241mn kg in 2017
RBI warns Budget 2018 may feed inflation as rates left on hold
Supreme Court cancels all iron ore mining permits in Goa
Corporate News
RITES may get into station development by acquiring 25% stake in IRSDC
Honda to wait for policy clarity before firming up EV plans in India
Jaguar Land Rover posts 3% increase in global sales at 49,066 units in Jan
Idea suspends interconnect services to Aircel over non-payment of dues
Market Outlook
February 08, 2018
Quarterly Bloomberg Brokers Consensus Estimate
Bhel Ltd - Feb 08, 2018
Particulars ( ` cr)
3QFY18E
3QFY17
y-o-y (%)
2QFY18
q-o-q (%)
Sales
7,621
6,320
20.6
6,384
19.4
EBIDTA
293
223
31.4
(95)
-
%
3.8
3.5
(1.5)
PAT
373
93
301.2
115
224.4
Petronet Ltd. - Feb 08, 2018
Particulars ( ` cr)
3QFY18E
3QFY17
y-o-y (%)
2QFY18
q-o-q (%)
Sales
8,222
6,299
30.5
7,770
5.8
EBIDTA
862
607
42.1
898
(4.1)
%
10.5
9.6
11.6
PAT
545
397
37.3
588
(7.3)
ABB Ltd. - Feb 08, 2018
Particulars ( ` cr)
3QFY18E
3QFY17
y-o-y (%)
2QFY18
q-o-q (%)
Sales
2,911
2,493
16.7
1,915
52.1
EBIDTA
320
301
6.3
134
138.1
%
10.9
12.1
7.1
PAT
191
158
20.8
83
130.1
Glenmark Pharma Ltd. - Feb 08, 2018
Particulars ( ` cr)
3QFY18E
3QFY17
y-o-y (%)
2QFY18
q-o-q (%)
Sales
2,189
2,535
(13.6)
2,256
(2.9)
EBIDTA
415
765
(45.7)
388
6.9
%
18.9
30.2
17.2
PAT
229
477
(51.9)
214
7.1
Cadila Healthcare Ltd. - Feb 08, 2018
Particulars ( ` cr)
3QFY18E
3QFY17
y-o-y (%)
2QFY18
q-o-q (%)
Sales
3,151
2,311
36.4
3,234
(2.5)
EBIDTA
836
404
106.9
857
(2.4)
%
26.5
17.5
26.5
PAT
537
323
66.3
503
6.8
Market Outlook
February 08, 2018
Top Picks
Market Cap
CMP
Target
Upside
Company
Rationale
(` Cr)
(`)
(`)
(%)
Strong growth in domestic business due to its leade`hip
in acute therapeutic segment. Alkem expects to launch
Alkem Laboratories
25,829
2,160
2,441
13.0
more products in USA, which bodes for its international
business.
We expect the company would report strong profitability
Asian Granito
1,525
507
651
28.5
owing to better product mix, higher B2C sales and
amalgamation synergy.
Favorable outlook for the AC industry to augur well for
Cooling products business which is out pacing the
Blue Star
7,022
732
867
18.5
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
15,689
500
712
42.3
presence in tier-II & III cities where the growth
opportunity is immense.
Loan growth is likely to pick up after a sluggish FY17.
Lower credit cost will help in strong bottom-line growth.
Karur Vysya Bank
8,198
113
160
41.8
Increasing share of CASA will help in NIM
improvement.
High order book execution in EPC segment, rising B2C
KEI Industries
3,053
390
436
11.9
sales and higher exports to boost the revenues and
profitability
Expected to benefit from the lower capex requirement
Music Broadcast
1,947
341
475
39.2
and 15 year long radio broadcast licensing.
Massive capacity expansion along with rail advantage
Navkar Corporation
2,592
172
265
53.9
at ICD as well CFS augur well for the company
Strong brands and distribution network would boost
Siyaram Silk Mills
2,992
638
851
33.3
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 the
TV Today Network
2,790
468
500
6.9
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 Gujarat
Maruti Suzuki
2,69,452
8,920
10,619
19.0
plant will also enable higher operating leverage which
will be margin accretive.
We expect loan book to grow at 24.3% over next two
GIC Housing
2,147
399
655
64.3
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 healthy
7,459
336
400
19.1
growth in plywood & lamination business, forayed into
Century Plyboards India
MDF & Particle boards on back of strong brand &
distribution network.
We expect sales/PAT to grow at 13.5%/20% over next
LT Foods
2,819
88
128
45.2
two years on the back of strong distribution network &
addition of new products in portfolio.
We expect sales/PAT to grow at 13%/16% over next two
years on the back of strong healthy demand in writing
Ruchira Papers
394
176
244
39.0
& printing paper and Kraft paper. Further, China had
banned making paper from waste pulp which would
benefit Indian paper companies.
We expect financialisation of savings and increasing
Aditya Birla Capital
36942
163
230
41.2
penetration in Insurance & Mutual fund would ensure
steady growth.
Source: Company, Angel Research
Market Outlook
February 08, 2018
Fundamental Call
Market Cap
CMP
Target
Upside
Company
Rationale
(` Cr)
(`)
(`)
(%)
CCL is likely to maintain the strong growth trajectory
CCL Products
3,993
300
360
19.9
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 healthy
Nilkamal
2,518
1,688
2,178
29.1
demand growth in plastic division. On the bottom-line
front, we estimate ~10% CAGR to `162cr owing to
improvement in volumes.
We expect sales/PAT to grow at 9%/14% over next two
years on the back of healthy demand growth in
Shreyans Industries
242
175
247
40.8
printing. Further, China had banned making paper
from waste pulp which would benefit Indian paper
companies.
The prism has diversified exposure in the different
segment such as Cement, Tile & ready mix concrete.
Prism Cement
6,133
122
160
31.3
Thus we believe, PCL is in the right place to capture
ongoing government spending on affordable housing
and infrastructure projects.
Source: Company, Angel Research
