lobal markets posted gains in the week gone by on the back of shift of central Gbanks back to stimulus mode and U.S. – China trade optimism. In the recently, concluded monetary policy meeting Federal Reserve maintained the status-quo but at the same time opened the door for cut in future to support the economy. European Central Bank (ECB) chief Mario Draghi also hinted that the bank is ready to ease monetary policy if the euro area’s economy did not improve. Inflation in Japanese economy came lower in the month of May, adding pressure on the central bank. Bond yields in U.S., Euro area and Japan declined after central bank statements.
Back at home, domestic markets ended the week on weak note with Nifty finished below 11,750 level amid uncertainty around the US-China trade negotiations and rising oil prices. So far U.S. president Donald Trump has repeatedly threatened to put more tariffs on Chinese goods. Foreign Institutional investors largely remained on the sell side of the markets. Going forward, markets would be eyeing on the outcome of the meeting between U.S. and China at the upcoming G-20 summit in Japan. Besides, global macroeconomic data, trend in global markets, progress of monsoon, the movement of rupee against the dollar and crude oil price movement will continue to dictate market trend.
On the commodity markets front, some miracle price movements were noticed in some commodities last week, which sent CRB higher, above the mark of 185 once again. A combination of loose monetary policy, a weaker dollar, and elevated geopolitical risks are still justifying the gold rally. Gold can further move higher towards 35500 while taking support near 33800 while silver can test 40000 taking support near 37800. The focus now shifts to whether the United States and China can resolve their trade row at a Group of 20 leaders summit in Osaka this week. Crude oil prices may witness further recovery on tensions in the Middle East after Iran shot down a U.S. military drone and on hopes for a drop in U.S. interest rates that may stimulate global growth. In base metal counter, copper and Nickel may witness more gains on supply concerns while zinc, lead and aluminum may trade sideways. Consumer Confidence Index, Powell to speak at Council on Foreign Relations in New York, Durable Goods Orders, Advance Goods Trade Balance, PCE Core and GDP of US, RBNZ Official Cash Rate, German Consumer Price Index, Euro-Zone Consumer Price Index Core etc are few strong triggers for the commodity market in this week.
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• Mahindra & Mahindra announced that effective July 1, 2019, the price of its range of personal vehicles will increase by up to Rs. 36,000 across models. This price increase is due to the implementation of AIS 145 Safety Norms across all passenger vehicles in India.
• Maruti Suzuki India announced that Dzire is now compliant with "AIS-145 Safety Norms" (both Petrol and Diesel). Dzire Petrol is also now BS-VI compliant. This will result in price increase in all variants of Dzire. Depending on features introduced across variants, the ex-showroom price inDelhi andNCR region shall vary from Rs. 5,82,613 to Rs. 9,57,622.
• Ashok Leyland announced that its plant situated at Pantnagar will remain closed from 24 June 2019 to 29 June 2019 (both days inclusive) to facilitate alignment of production with sales requirements.
• Glenmark Pharmaceuticals has been granted tentative approval by the United States Food & Drug Administration (U.S. FDA) for Clindamycin Phosphate Foam, 1%, a generic version of EVOCLIN®1 Foam, 1%, of Mylan Pharmaceuticals Inc. According to IQVIA™ sales data for the 12 month period ending April 2019, the EVOCLIN® Foam, 1% market2 achieved annual sales of approximately $17.0 million.
• Blue Star announced that Mumbai Metro Rail Corporation (MMRCL) has issued a Letter of Intent to the Company for Design, manufacture, Supply, Installation, Testing and Commissioning of Tunnel Ventilation and Air Conditioning System approximately valued at Rs 253 crore, subject to the definitiveagreements tobeexecutedbetweentheCompanyandMMRCL.
• Va Tech Wabag has secured Rs 1477 crore worth order from State Mission for Clean Ganga - Uttar Pradesh towards operation, maintenance and management of the sewage treatment and network infrastructure in the cities of Agra and Ghaziabad for a period of 10 years, expandable for an additional period of 5 years.
• Polyplex Corporation announced that its subsidiary, Polyplex (Thailand) Public Company (PTL) has decided to set up BOPP Film Line project with a capacity of 60,000 TPA, in Indonesia at an estimated cost of USD 48 Million (excluding Working Capital). Above project would be implemented by 'PT. Polyplex Films Indonesia', Indonesia a Wholly Owned Subsidiary of PTL.
• Hindustan Copper is focusing on re-opening its closed mines and expand existing ones in its quest to increase ore production five times from the current level of 4.1 million tonne (MT) by 2025.
• Ajmera Realty & Infra India along with a local partner in Mumbai has announced joint development of Commercial units at project located at Ashok Mills lane, off LBS Marg,Ghatkopar (W),Mumbai. The project will be on revenue sharing basis in Ghatkopar on a plot size of 5310 sq.mt which has a potential to develop approx.90,00 sq.ft of saleable area as the company's share of development, which may generate revenue of approx Rs.120 crore for the company. The project entails development of approx.225 units. The project has received zero IOD and has initiated demolition.
• The Federal Reserve left interest rates unchanged after its June policy-setting meeting. The Federal Open Market Committee votes 9-1 to keep the benchmark rate in a target range of 2.25% to 2.5%.
US initial jobless claims dipped to 216,000, a decrease of 6,000 from the previous week's unrevised level of 222,000. Economists had expected jobless claims to edge down to 220,000.
• US industrial production climbed by 0.4 percent in May following a revised 0.4 percent decrease in April.
• Eurozone consumer confidence index declined to -7.2 from -6.5 in May. Economists had expected the index to remain unchanged. In April, the reading was -7.3.
• The Bank of England maintained its interest rate and quantitative easing on Thursday, but downgraded its near-term growth projection as downside risks increased amid trade disputes and no-deal Brexit fears. The nine-member Monetary Policy Committee, led by Governor Mark Carney, unanimously decided to hold the bank rate at 0.75 percent.
• Japan's all industry activity index rose 0.9 percent month-on-month in April, after a 0.3 percent fall in March. Economists had expected a 0.7 percent rise.
|Stocks||*Closing Price||Trend||Date Trend Changed||Rate Trend Changed||SUPPORT||RESISTANCE||Closing S/l|
|S&P BSE SENSEX||39195||UP||08.02.19||36546||36300||35300|
Closing as on 21-06-2019
1) These levels should not be confused with the daily trend sheet, which is sent every morning by e-mail in the name of "Morning Mantra ".
2) Sometimes you will find the stop loss to be too far but if we change the stop loss once, we will find more strength coming into the stock. At the moment, the stop loss will be far as we are seeing the graphs on weekly basis and taking a long-term view and not a short-term view.
|24-Jun-19||Future Enterprises||Fund Raising|
|24-Jun-19||Future Enterprises||Fund Raising|
|25-Jun-19||Andhra Bank||Fund Raising|
|27-Jun-19||GIC of India||Other business matters|
|28-Jun-19||Reliance Capital||Financial Results/Other business matters|
|28-Jun-19||Reliance Home Finance||FinancialResults/Otherbusinessmatters|
|4-Jul-19||GM Breweries||Financial Results|
|12-Jul-19||3i Infotech||Financial Results|
|19-Jul-19||Dabur India||Financial Results|
|20-Jul-19||HDFC Bank||Financial Results|
|24-Jun-19||Tata Sponge Iron||Rights 15:7@Premium Rs 490 Per Share|
|26-Jun-19||Relaxo Footwears||Bonus 1:1|
|27-Jun-19||BSE||Dividend - Rs 25 Per Share|
|28-Jun-19||Tata Chemicals||Dividend - Rs 12.50 Per Share|
|28-Jun-19||Nucleus Soft. Exports||Dividend - Rs 9 Per Share|
|1-Jul-19||RBL Bank||Dividend Rs 2.70/-|
|2-Jul-19||Supreme Industries||Dividend - Rs 9 Per Share|
|3-Jul-19||Laurus Labs||Dividend - Rs 1.50 Per Share|
|4-Jul-19||Tata Steel||Dividend - Rs 13 Per Share|
|4-Jul-19||Axis Bank||Dividend - Re 1 Per Share|
|4-Jul-19 B||Balkrishna Industries D||Dividend - Rs 2 Per Share|
|4-Jul-19||HDFC AMC||Dividend - Rs 12 Per Share|
|4-Jul-19||BASF India||Div. - Rs 3 Per Share/ Spl. Div. - Rs 2 Per Share|
|5-Jul-19||Quick Heal Tech. D||Dividend - Rs 2 Per Share|
PETRONET LNG LIMITED
Target Price: 272
|Face Value (Rs.)||10.00|
|52 Week High/Low||254.55/203.40|
|M.Cap (Rs. in Cr.)||35512.50|
|P/E Ratio (times)||16.48|
|P/B Ratio (times)||3.53|
|Dividend Yield (%)||2.32|
• Petronet LNG Limited has set up the country's first LNG receiving and regasification terminal at Dahej, Gujarat, and another terminal at Kochi, Kerala. While the Dahej terminal has a nominal capacity of 15 MMTPA, which is being expanded to 17.5 MMTPA, the Kochiterminal has a capacity of 5 MMTPA.
• Petronet LNG aims to hit 25-30% utilization at Kochi terminal by the end of FY20 against 10% currently. Dahej's 2.5 mmtpa expansion will be completed by June 2019 which is expected to stabilize by end of 2019. Petronet is working on tie up tolling contract and is also open to bring own gas.In Sri Lanka,the JV agreement has been submitted. The project would be 2.5 mmtpa FSRU with USD 300 million in total capex. It aims to go ahead with Bangladesh only on a nomination basis with sovereign guarantees.
• Despite the upcoming terminals at Ennore and Mundra, the Dahej facility continues to be competitive given its strong pipeline connectivity thereby being a low-cost re-gasifier which would give it an edge over other players. The upcoming capacity at the terminal will further improve earnings prospects for Petronet LNG.
• During Q4 FY19, Dahej terminal operated at around 104% of capacity and processed 199 TBTU (Thousand British Thermal Units) of LNG as against 197 TBTU processed during Q3 FY18 and 207 TBTU YoY. The overall LNG volume processed by the Company in Q4 FY19 was 205 TBTU, as against the LNG volume processed in the previous and corresponding quarter, which stood at 202 TBTU and 213 TBTU respectively.
• It reported Rs. 440 crore profit for Q4 FY19 lower by 15.87% than the Rs. 523 crore YoY. The profits were hit by an inventory loss of Rs. 119 crore. The spot price of natural gas has fallen from US$8.5 per mBtu in the beginning of the quarter to US$ 4.3 per mBtu. This loss was a notional loss as per the valuation of inventory for the quarter as per IndAS.
• Industrial Slowdown
• Fluctuation in Natural Gas prices
Spot LNG prices have remained weak due to increasing capacity additions coming in, including from the US leading to global over supply. Lower gas prices will give thrust to overall LNG consumption, especially from fertilizers and City gas operators leading to higher CNG/PNG consumption. Thus it is expected that the stock will see a price target of Rs. 272 in 8-10 months time frame on the PEx of 15.92 times and FY20E EPS of Rs. 17.09.
Target Price: 74
|Face Value (Rs.)||1.00|
|52 Week High/Low||84.70/46.55|
|M.Cap (Rs. in Cr.)||10494.00|
|P/E Ratio (times)||26.79|
|P/B Ratio (times)||6.96|
|P/BDividend Yield (%)||1.11|
• NBCC (India) holds the status of Navratna CPSE. Its areas of operation encompass project management consultancy, Engineering Procurement & Construction (EPC) and real estate development.
• Order book of the company is around Rs 75000- 80000 crore and out of the order book the redevelopment component is 41000 crore. The management expects order inflows of Rs 12500-Rs 15000 Cr for Fy20.
• The management of the company expects about 25- 30% revenue growth for standalone entity and 20- 25% for consolidated entity in FY20. EBITDA margin of about 5-5.5% is likely to be sustained for FY20.
• In the Delhi redevelopment projects, in Sarojininagar and Netajinagar, the company has awarded Rs 1500 crore worth of work and another Rs 3000 crore worth of work is in advanced stage of awarding. It has sold about Rs. 5000 Cr worth of commercial space in the Nauroji Nagar project till date and intends to monetizeanotherRs.4000-5000CrinFy20.
• In relation to its subsidiaries, the operations of subsidiaries i.e. HSCL & HSCC are normalized and management expects more than 15% growth in revenue by HSCC. HSCLPAT margin improved from 3.5 to 5%in F19 andexpectthattrendto continue.Income from operation of HSCC is Rs 2063 in FY19 and its PAT was Rs 49.8 crore. HSCL registered an income from operationofRs657croreandaPATofRs34.29crore.
• During FY19, its consolidated sale for the period was up by 18% to Rs 9942.97 crore and with 170 bps contraction in OPM,the operating profit was down by 19% to Rs 365.11 crore. Gained by higher OI as well as
lower interest and depreciation as % of operating profit, the fall at PBT before share of profit from JV moderated to 3% (to Rs 568.53 crore). The taxation was down by 6% to Rs 177.26 crore and thus the fall at PATwas restrictedat1%toRs391.64crore.
• Increase in escalation cost due to delay in projects
• Political uncertainties and changes in regulations
The company is continuously performing well and delivering in all the three parameters of revenue, profitability and order intake. The management of the company has maintained its annual guidance of 20% growth for FY20 revenue. A major push from the government on the roads, railways, and urban infrastructure segments has helped construction companies improve their order book position. We expect the stock to see a price target of Rs.74 in 8-10 month time frame on a one year average P/BV of 6x and FY20 (BVPS) Book Value Per Share of Rs.12.40.
Source: Company Website Reuters Capitaline
Above calls are recommended with a time horizon of 8 to 10 months.
The stock closed at Rs 199.90 on 21st June, 2019. It made a 52-week low of Rs 172.50 on 14th February 2019 and a 52-week high of Rs. 205 on 03rd September 2018. The 200 days Exponential Moving Average (DEMA) of the stock on the daily chart is currently at Rs 191.45
As we can see on chart that stock is forming an “Inverted Head and Shoulder” pattern on weekly charts, which is bullish in nature. Apart from this, it is trading in higher highs and higher lows on daily chart, which also give positive outlook for coming days. Therefore, one can buy in the range of 195-197 levels for the upside target of 215-220 levels with SL below 185.
The stock closed at Rs 1292.35 on 21st June, 2019. It made a 52-week low at Rs 732.30 on 09th October 2018 and a 52-week high of Rs. 1317 on 21st June 2019. The 200 days Exponential Moving Average (DEMA) of the stock on the daily chart is currently at Rs 1046.98
The Stock is continuously trading in higher highs and higher lows sort of “Rising Wedge” on weekly chart, which is bullish in nature. Last week, stock has given the pattern breakout and also has managed to close above the same so follow up buying may continue for coming days. Therefore, one can buy in the range of 1260-1270 levels for the upside target of 1360-1370 levels with SL below 1210.
Disclaimer : The analyst and its affiliates companies make no representation or warranty in relation to the accuracy, completeness or reliability of the information contained in its research. The analysis contained in the analyst research is based on numerous assumptions. Different assumptions could result in materially different results.
The analyst not any of its affiliated companies not any of their, members, directors, employees or agents accepts any liability for any loss or damage arising out of the use of all or any part of the analysis research.
SOURCE: CAPITAL LINE
Charts by Spider Software India Ltd
Above calls are recommended with a time horizon of 1-2 months
Nifty dragged down due to liquidation of long positions and profit booking. Recent data has turned cautious and is indicating probability of further profit booking. Call writing and put unwinding were seen in the recent trading session. Call writers were active in 11900, 11800 strike calls indicating limited upside. The levels of 11700 will remain crucial for this week as indicated by option open interest concentration. If Nifty falls below the 11700 mark, it could correct to 11600 levels on the back of further profit booking. On bounce the index will face strong resistance at 11800-11850 levels. The options open interest concentration is at the 11800-strike calls with the highest open interest of above 32 lakh shares; among put options, the 11700-strike taking the total open interest to 34 lakh shares, with the highest open interest among put options. The Implied Volatility (IV) of calls closed at 12.84% while that for put options closed at 13.00%. The Nifty VIX for the week closed at 14.00% and is expected to remain sideways. The PCR OI for the week closed at 1.43 which indicates put writing. Next support is placed around 11700-11650 levels.
**The highest call open interest acts as resistance and highest put open interest acts as support.
# Price rise with rise in open interest suggests long buildup | Price fall with rise in open interest suggests short buildup
# Price fall with fall in open interest suggests long unwinding | Price rise with fall in open interest suggests short covering
During the past week, turmeric futures (July) nose-dived to a month low of 6304, taking negative cues from the spot markets. Currently, the sentiments are bearish as sowing of the spice is in progress in Sangli, Maharashtra, as well as in Telangana. The latest reports cites that in Telangana only 25% of sowing has been done till now by those who have water facility and farmers are waiting for monsoon to pick pace. Favorable conditions for the advance of monsoon are also seen in remaining parts of Tamil Nadu and northeast India over the next two-three days. Based on the above fundamentals, it is expected that the counter may continue to trade with a bearish & may test 6200-6100 levels, if breaks the support near 6300 levels. Jeera futures (July) is likely to consolidate in the range of 17100-17550 levels, with upside getting capped. The reason being its exports have fallen due to sluggish demand from China and Bangladesh. Since the beginning of the year, cardamom futures have witnessed a stellar bull-run & have posted a gain of 101% by reaching to an all-time high of 2889 from the lows of 1441. The various reasons such as absence of carry-over stocks, last year’s production loss and anticipation of a delayed production this year is being attributed to this rally. The prices of cardamom reached an all-time high of Rs.5,000 a kg at the Spices Board auctions. The 7-mm and 8-mm varieties were sold at 4,000 rupees per kg and 3,500 rupees, respectively. Taking these positive cues, the July contract may continue to head towards 3200 levels on the back of harvesting getting delayed by two months due to inadequate summer rains.
Bullion counter may continue its sharp upside momentum as dovish stance by the Fed in last week meeting and geopolitical tensional in middle east continue to assist the prices higher. U.S. Federal Reserve indicated that it could cut interest rates as early as July, prompting a sharp fall in the dollar and U.S. Treasury yields. The Fed stated that it was ready to battle growing global and domestic economic risks with interest rate cuts beginning as early as next month, as it took stock of rising trade tensions and growing concerns about weak inflation. One interesting fact was that the all-time favorite word “patient” was somewhere missing in the statements; Fed sees a lot of uncertainties in the market. U.S. benchmark 10-year Treasury yields dropped below 2% for the first time in more than 2-1/2 years, while other maturities fell to multi-year lows as well, a day after the Fed flagged interest rate cuts as early as next month. Gold can further move higher towards 35500 while taking support near 33800 while silver can test 40000 while taking support near 37800. Meanwhile Russia’s gold reserves stood at 70.4 million troy ounces as of the start of June. Central banks made the headlines last week, by setting the dovish mood in the market. ECB governor Draghi stated that if inflation does not keep up with expectations we can see a rate cut. BOE also decided to maintain status quo and mentioned that if required changes in the rates can be made following Brexit issue around the corner.
The correction being witnessed in soybean futures (July) may take a pause taking support near 3550 levels. The market participants are cautiously watching the movement of monsoon & its impact on the progress of sowing in the major growing areas. According to Reuters, key growing areas for soybean have seen rainfall significantly below average for monsoon season. The planting of this summer sown oilseed crop has been delayed by at least two weeks as the states of Maharashtra and Madhya Pradesh have observed the lowestrainfall levels this monsoon. Days ahead, if rainfall delays further, it could change sowing patterns and could hurt crop yields as well. On CBOT, U.S soybean futures (July) is forecasted to be on course to test $9.30 a bushel on the higher side.Going ahead, the traders would remain focused on the wet weather and the potential for soybean plantings to decline. Moreover, attentions would be on G20 summit as U.S. President Donald Trump and Chinese counterpart Xi Jinping are expected to meet there. Mustard futures (July) is expected to witness an upside momentum towards 3960-3990 taking support near 3890 levels. The spot markets are witnessing a sharp decline in mandi arrivals in all its major producing states i.e. Rajasthan, Uttar Pradesh and Madhya Pradesh. Soy oil futures (July) will probably rise further to test 750-755 if breaches the resistance near 745 levels. While, CPO futures (July) is likely to take support near 512 & move higher towards 535 levels. The sentiments of the domestic edible oil prices are firm owing to firmness in the soybean oil on CBOT as well as stronger energy markets, which could boost demand for vegetable oils from biodiesel producers.
Crude oil prices may witness further recovery on tensions in the Middle East after Iran shot down a U.S. military drone and on hopes for a drop in U.S. interest rates that may stimulate global growth. U.S. President Donald Trump played down the destruction of the drone; tensions remain high after the latest incident in the Gulf, which followed tanker attacks that raised concerns about crucial oil supplies being disrupted. Tension has been rising in the Middle East, home to over 20% of the world’s oil output, after attacks on two tankers near the Strait of Hormuz, a chokepoint for oil supplies. Washington blamed Tehran for the tanker attacks. Iran denied any role. The demand-side picture has also improved, with expectations that the U.S. Federal Reserve will cut interest rates at its next meeting and with plans by Beijing and Washington to resume talks to resolve a trade war that has hit economic growth prospects. Crude oil may take support near 3800 and can recover towards 4150 in near term. The meeting of OPEC and Non-OPEC members was scheduled on 25-26 June 2018 at Vienna, Austria, which is rescheduled on 1-2 July as per OPEC sources. Natural gas may remain under selling pressure on unfavorable weather as it can test 140 while facing resistance near 165. The weather has remained milder than normal for this time of year which has weighed on cooling demand. This comes as production continues to rise and accelerate according to the EIA.
Since mid-April, cotton futures (July) is giving a lower closing week-on week due to the bearish trend of ICE cotton futures owing to ongoing failure of talks between U.S & China, raising concerns of an elevated trade war. Last week, cotton on the Intercontinental Exchange hit the lowest price since June 2016 on the front month continuation chart due to dearth in export demand for U.S cotton. Going ahead, cotton on MCX may witness a correction towards 21300- 21100, while on international market may touch 60 cents per pound if the window closes without reaching a deal when US President Donald Trump and Chinese President Xi Jinping meet at the G20 summit this week in Osaka, Japan. The trend of castor seed futures (July) would probably continue to remain bearish & it may descend towards 5175-5135 levels. The overall market sentiments are pessimistic due to tepid demand for castor oil from overseas buyers, mainly China. On the supply side, the market participants would trade with cautiousness & closely watch the impact of monsoon on the sowing progress. The primarily estimates show thatthis season the output may be 9.50- 11.50 lakh tons & with a carry-over stock of 2.49-3.80 lakh tons from last year, the total supply may amount to 12-15 lakh tons. Meanwhile, the estimated demand is expected to be 15-16 lakh tons.The rally of cocud futures (July) seems to be getting tired & hence we may see profit booking from higherlevels towards 2750.At this juncture, the volumes as well as open interests are declining which is indicating that long positions have started unwinding. Moreover, correction in cotton prices may add to the bearish sentiments.
In base metal counter, copper and Nickel may witness more gains on supply concerns while zinc, lead and aluminum may trade sideways. Additionally one more support for the base metals is that, US-China trade talks which were hanging in the air are set to resume later in this month. Copper may further recover lower towards 430 levels while taking support near 410. Unions at Chile's Chuquicamata mine called on members to reject a sweetened contract offer from Codelco, the world's largest copper producer, amid a nearly weeklong strike that has halved output from the sprawling copper mine. Meanwhile Lead may trade sideways as it can face resistance near 160 levels while taking support near 148 levels. Across January-April of this year, lead mine production climbed up by 0.7% to 1,544,000 tonnes from 1,534,000 tonnes over the same period in 2018. Zinc may trade with sideways bias as it can take support near 198 levels while taking resistance near 210 levels. Nickel can further recover towards 930 while taking support near 865 amid worries that floods in Indonesia could disrupt supplies of nickel. In the first four months of the year, the global nickel deficit narrowed to 27,200 tonnes from a deficit of 59,400 tonnes in the same period of 2018. Widespread flooding in Indonesia’s nickel hub on the island of Sulawesi has halted some mining operations in Indonesia. Aluminium may take 148 levels while taking support near 140 levels. Global primary aluminium output rose to 5.438 million tonnes in May from a revised 5.222 million tonnes in April.
CRUDE OIL MCX (JUL) contract closed at Rs. 3977 on 20th Jun’19. The contract made its high of Rs. 4694 on 24th Apr’19 and a low of Rs.3540 on 06th May’19. The 18-day Exponential Moving Average of the commodity is currently at Rs. 3838.38.On the daily chart, the commodity has Relative Strength Index (14-day) value of 55.44.
One can buy around Rs. 3930 for a target of Rs.4180 with the stop loss of Rs. 3800
NICKEL MCX (JUN) contract closed at Rs. 901.30 on 20th Jun’19. The contract made its high of Rs. 960.00 on 04th Apr’19 and a low of Rs. 844.00 on 06th Jun’19. The 18-day Exponential Moving Average of the commodity is currently at Rs. 870.32 On the daily chart, the commodity has Relative Strength Index (14-day) value of 62.30.
One can buy at Rs. 885 for a target of Rs. 915 with the stop loss of Rs. 870.
JEERA NCDEX (JULY) contract was closed at Rs. 17225 on 20th Jun’19. The contract made its high of Rs. 18195 on 16th May’19 and a low of Rs. 17160 on 20th Jun’19. The 18- day Exponential Moving Average of the commodity is currently at Rs. 17406 on the daily chart, the commodity has Relative Strength Index (14-day) value of 49.72.
One can sell at Rs. 17550 for a target of Rs. 17000 with the stop loss of Rs 17800.
• SEBI has allowed exchanges to launch futures trading in commodity indices.
• BSE will launch Turmeric futures contract on 28th June, 2019.
• The government plans to spend 25 trillion rupees in "the coming years" to boost agricultural productivity, President Ram Nath Kovind said, while addressing a joint sitting of Parliament.
• Gulf OPEC producers will keep their July oil production within their OPEC target.
• Steelmakers in Europe have been hit by falling demand and rising supply as auto-sector consumption has fallen and U.S. steel tariffs have disrupted shipments.
• US Initial claims for state unemployment benefits dropped 6,000 to a seasonally adjusted 216,000 for the week ended June 15.
• OPEC's share of global production fell to just 41.5% last year, the lowest since 2003.
• The government has drafted a contingency plan for 2019- 20 (Jul-Jun) Kharif crops as the delay in monsoon rains are taking a toll on sowing.
• The Cotton Advisory Board made a sharp 7% downward revision in estimate for India's output in 2018-19 (OctSep) to 33.7 million bales (1 bale = 170 kg) from 36.1 million bales it forecast in its first estimate in November.
Some price movements were noticed in commodities last week, which sent CRB higher, above the mark of 185 once again. A decline in benchmark 10-year Treasury yields below 2% and a rise in gold above heavy technical resistance to a near six-year high has sent dollar index lower. Oil prices saw solid rebound from lower side, with Brent crude heading for its first weekly gain in five weeks on tensions in the Middle East after Iran shot down a U.S. military drone and on hopes for a drop in U.S. interest rates that may stimulate global growth. While U.S. President Donald Trump played down the destruction of the drone, tensions remain high after the latest incident in the Gulf, which followed tanker attacks last week that raised concerns about crucial oil supplies being disrupted. Crude in MCX traded near 4000 levels. Natural-gas prices declined after a larger-than-expected weekly climb in U.S. supplies. The U.S. Energy Information Administration reported Thursday that domestic supplies of natural gas rose by 115 billion cubic feet for the week ended June 14. Gold futures topped $1,400 an ounce for the first time since 2013, riding bullish momentum after major central banks projected more dovish stances this week and geopolitical tensions rose, while silver prices hit a five-week high. Gold has been trading on a positive note for the last four weeks in MCX on growing geopolitical concerns and weak economic releases from U.S. and China that lifted its safe haven appeal. Gold is also seeing safe-haven demand on reports Iran’s military shot down a U.S. military drone in Iranian territory. In MCX, it surpassed the level of 34400 and silver crossed 38400. Almost all base metals rose in the week gone by supported by weaker dollar. Copper prices also rose owing to supply disruptions as a labour strike halved output at one of the world's largest mines in Chile and Glencore's Zambian smelter shut for refurbishment. Nickel prices witnessed some buying on concerns over supply disruptions in Indonesia -- the world’s largest nickel exporter and producer.
In spices, cardamom is still on fire on lower production amid small carry forward. Dhaniya and turmeric saw further decline, especially turmeric. In the initial stage it is being estimated that acreage of turmeric is expected to rise by 25% on year in 2019-20 (Jul-Jun). Cotton saw some strength despite fall in international market. Import of cotton in the 2018-2019 cotton season is expected to be 22 lakh bales, almost seven lakh bales higher compared with the previous season.
Now after getting approval from SEBI, BSE is scheduled to launch futures trading in turmeric on June 28. The exchange has received the SEBI approval to launch futures contract in castor seed and chana as well. We all know that BSE is the latest entrant into the commodity derivatives trading. Earlier BSE had launched futures trade in cotton and guar seed/gum. Riding on the exchange’s superior technology and transparent processing mechanism, BSE would strive to develop a benchmark price in the agriculture commodity space over a period of time and help farmers reap the right price for their produce. It is significant that in the past 3-4 months, BSE’s derivative trade volumes in agri commodities are higher than its non-agri segment.
Global & Domestic scenario of Rice
The contract for the trade has been designed in consultation with traders and farmer associations to ensure that it is relevant to the market and does not remain just another product. The exchange has waived transaction fee till September and expects farmers to use the opportunity to hedge theirrisk on the exchange platform.
Contract Specifications of Turmeric Futures
|18th JUN||ECB clears path for more stimulus amid weak inflation.|
|19th JUN||FOMC keeps rate unchanged but opens the door for a rate cut in the future.|
|20th JUN||RBI governor says economic activity clearly losing traction at MPC meet.|
|20th JUN||Iran shoots down US surveillance drone amid heightening tensions.|
Indian Rupee traded in a narrow band this week amid heavy intervention from RBI which capped Rupee to move higher. Additionally geo-political tension between USIran lifted the premiums higher. However, minutes released on Thursday from RBI latest MPC meet revealed that members are in view of to boost growth, looking at moderate inflation and subdued growth. Admittedly, External Member Ravindra Dholakia said that there is a room for 70-80 basis points rate cut. According to Executive Member Mr Patra said if domestic inflation continues to be below RBI's target, "a higher weight needs to be assigned to growth relative to previous meetings." Globally FOMC kept Fed Fund rate unchanged in June. The projections of FOMC participants were last published in December. At the time, the median projection for the federal funds rate implied the need for two 25bp hikes in 2019 and another one in 2020. Since early January, though, Fed officials have adopted a patient approach. Combined with the recent weakness of US economic data, FOMC participants signaled no interest rate cut this year but two cuts in 2020. The socalled dot-plot in which FOMC members plotted their forecasts for interest rates showed one official indicated one cut this year, while seven officials indicated two. The median remained at 2.4 percent. Additionally rate-setters mentioned that it would "act as appropriate to sustain the expansion" and would "closely monitor the implications of incoming information for the economic outlook".
USDINR is likely to stay within the range of 69.30 and 70.10 with positive bias.
USD/INR (JUL) contract closed at 69.8350 on 20th Jun’19. The contract made its high of 70.3425 on 17th Jun’19 and a low of 69.79 on 20th Jun’19 (Weekly Basis). The 14-day Exponential Moving Average of the USD/INR is currently at 70.02
On the daily chart, the USD/INR has Relative Strength Index (14-day) value of 44.22. One can buy at 69.80 for the target of 70.40 with the stop loss of 69.50.
EUR/INR (JUL) contract closed at 79.1425 on 20th Jun’19. The contract made its high of 79.2250 on 20th Jun’19 and a low of 78.43 on 19th Jun’19 (Weekly Basis). The 14-day Exponential Moving Average of the EUR/INR is currently at 79.14
On the daily chart, EUR/INR has Relative Strength Index (14-day) value of 51.41. One can sell at 79.60 for a target of 79 with the stop loss of 79.90.
GBP/INR (JUL) contract closed at 88.84 on 20th Jun’19. The contract made its high of 89.08 on 20th Jun’19 and a low of 87.8025 on 19th Jun’19 (Weekly Basis). The 14-day Exponential Moving Average of the GBP/INR is currently at 88.81
On the daily chart, GBP/INR has Relative Strength Index (14-day) value of 42.47. One can buy at 88.40 for a target of 89 with the stop loss of 88.10.
JPY/INR (JUL) contract closed at 64.9150 on 20th Jun’19.The contract made its high of 65.3075 on 17th Jun’19 and a low of 64.5725 on 19th Jun’19 (Weekly Basis). The 14-day Exponential MovingAverage ofthe JPY/INR is currently at 64.68
On the daily chart, JPY/INR has Relative Strength Index (14-day) value of 59.33. One can buy at 65.10 for a target of 65.70 with the stop loss of 64.80.
|Offer for sale (Shares)||4,887,862|
|Fresh Issue (Shares)||0|
|Net Offer to the Public||4,877,862|
|Issue Size (Rs. Cr.)||474-476|
|Price Band (Rs.)||970-973|
|Discount offered to Retail &|
|Total Issue for Sale||4,887,862|
|Promoters & promoters group||57.58||54.61|
|To achieve the benefit of listing the equity shares on the Stock Exchanges and for the sale of an aggregate of up to 4,288,801 equity shares by the selling shareholders|
Considering the P/E valuation on the upper price band of Rs.973, EPS and P/E of FY2019 are Rs.6.97 and 139.68 multiple respectively and at a lower price band of Rs.970, P/E multiple is 139.25. Looking at the P/B ratio on the upper price band of Rs.973, book value and P/B of FY19 are Rs 55.57 and 17.51 multiple respectively and at a lower price band of Rs. 970 P/B multiple is 17.46. No change in pre and post issue EPS and Book Value as the companyisnotmakingfreshissueofcapital.
Book Running Lead Manager
Edelweiss Capital Limited
ICICI Securities Limited
Jefferies India Private Limited
Name Of The Registrar Link Intime India Private Ltd
About the company:
The company is India’s largest online B2B marketplace for business products and services with approximately 60% market share of the online B2B classifieds space in India in fiscal 2017. The company operates through its product and supplier discovery marketplace, www.indiamart.com or “IndiaMART”. As of March 31, 2019, it had 8.2 crore registered buyers and it had 0.5 crores supplier storefronts in India.
IndiaMART’s strong network effects and brand recognition drives leadership in the B2B marketplace in India : : As of March 31, 2019, IndiaMART provided 8.27 crore on registered buyers with access to 0.5 crore supplier storefronts in India, which list 6.0 crores products and services across 54 industries. “IndiaMART” has become an established and trusted pan India brand, primarily through word-of-mouth accounts of its suppliers’ and buyers’ experiences.
Comprehensive, convenient and reliable platforms for buyer: The company has access to a large number of verified suppliers, products and services. Access to its large database of suppliers and products also gives buyers the benefit of competitive and transparent prices..
Efficient and effective marketing platform for suppliers: A total of 15.68 Crore business enquiries were delivered to IndiaMART suppliers in fiscal 2017 from its 4 Crore registered buyers, 29 Crore business enquires were delivered in fiscal 2018 from its 6 Crore registered buyers and 44.8 C Crore business enquires were delivered in fiscal 2019 from its 8.2 Crore registered buyers. The IndiaMART premium number service allotted unique phone numbers to approximately 470,053 suppliers as of March 31, 2019, and connects calls directly to suppliers.
Robust mobile platform: Its mobile website and app together accounted for 72% and 76%, respectively, of total traffic to IndiaMART as of March 31, 2018 and March 31, 2019, compared to 63% as of March 31, 2017.
Continue to focus on its non-paying and paying supplier acquisition and customer service efforts: : The company plans to expand its supplier acquisition efforts, as well as focus on developing its direct sales force as part of its efforts to up-sell higher margin, higher value subscription packages to existing paying subscription suppliers with category and city-specific pricing models to help increase its sales and profitability.
Leverage growth in mobile penetration: The company believes that leveraging increases in mobile penetration in India and promoting the use of its mobile website and app will consequently increase the number of active buyers and suppliers on its online marketplace.
Attract larger suppliers and leading brands while growing its core SME segment supplier base: The company has increased the number of large corporates and leading brands, it expects its average revenue realization to grow from paying customers through its competitive pricing strategies. This also helps IndiaMART strengthen its credibility amongst small and medium enterprises.
• Competition from new and existing companies may reduce demand for its services
• Most of its revenue from Indian suppliers purchasing paid services on IndiaMART
• The growth of its business depends on the growth of mobile Internet penetration
• Depend on third-party service providers for a significant portion of outsourced operational services.
IndiaMART’s is a first mover in providing a platform for MSMEs as B2B online trading platform. Its strong network effects and brand recognition drives leadership in the B2B marketplace in India. On the flip side, the Company depends on third-party service providers for a significant portion of outsourced operational services, and its business may be adversely affected if it fails fail to meet its requirements or face operational or system disruptions. The issue appears aggressively priced. Along term investor may consider investment for the issue.
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Quantum Mutual Fund launches ESG Equity Fund
Quantum Asset Management Company has launched its first open ended ESG (Environment, Social and Governance) fund – Quantum India ESG Equity Fund. The new fund offer will be open for subscription from 21st June to 5th July 2019. According to a press release by the fund house, the Quantum India ESG Equity Fund (QESG) will invest primarily in stocks of Indian companies. The investment strategy of the scheme will be to invest in a basket of stocks after intensive analysis of their environment, social and governance practices/standards, said the fund house. Chirag Mehta, Senior Fund Manager - Alternative Investments and Sneha Joshi, Associate Fund Manager - Alternative Investments will be managing this fund jointly.
Aditya Birla Sun Life Mutual Fund launches Pharma & Healthcare Fund
Aditya Birla Sun Life Mutual Fund has launched Aditya Birla Sun Life Pharma & Healthcare Fund, an open ended equity scheme that will invest in pharma and healthcare services sector. The new fund offer (NFO) will open for subscription on June 20 and close on July 4. According to a press release by the fund house, apart from the core pharma and healthcare space, the fund will also look at other large opportunities in sectors like hospitals and diagnostics, wellness businesses, or the global contract research and manufacturing services industry (CRAMS). The scheme can also invest in equities of listed overseas companies, in line with the RBI and SEBI guidelines. The fund will be managed by Dhaval Shah. The benchmark index for the fund is S&P BSE Healthcare TRI (Total Return Index).
HDFC Mutual Fund to buy Rs 500-crore NCDs of Essel Group from its debt schemes.
HDFC Mutual Fund has decided to buy Rs 500 crore worth of Non-Convertible Debentures (NCDs) of the Essel Group from the debt schemes that have exposure to these securities. The fund house, in a disclosure to stock exchanges late Monday evening, said it will repay investors in fixed maturity plans (FMPs) that hold Essel-issued securities and are due for maturity until September. The move removes uncertainty among investors, who were concerned that they might not get back their entire investments in case the Subhash Chandra-controlled group failed to sell some of its assets and repay lenders before September.
ETF Securities Australia launches first Indian ETF in tie-up with Reliance Nippon Life AMC
ETF Securities June 20 launched the first Indian ETF in Australia, andReliance Nippon Life Asset Management Ltd (RNAM) has entered into an arrangement with the former to provide advisory services to investors. Listed on the Australian Securities Exchange with the code NDIA, the ETF will provide Australian investors a unique opportunity to tap into the world's fastest-growing major economy, RNAM said in a statement. NDIAtracks India's Nifty 50 Index, which holds the country's fifty-biggest companies listed on the National Stock Exchange (NSE), it said. It accounts for 13 sectors representing about 66.80 per cent of the free float market capitalisation of the stocks listed on the NSE, it added.
Note:Indicative corpus are including Growth & Dividend option . The above mentioned data is on the basis of 08/08/2019 Beta, Sharpe and Standard Deviation are calculated on the basis of period: 1 year, frequency: Weekly Friday, RF: 7%
*Mutual Fund investments are subject to market risks, read all scheme related documents carefully
Mr. Ajay Garg (CEO & Director, SMC Global Securities Ltd.) addressing the audience during Investor Awareness Program in association with NSE and NSDL held on Friday, 14th June, 2019 at Lemon Tree Hotel, Amritsar.
Mr. D K Aggarwal (CMD, SMC Investments & Senior VP – PHD Chamber of Commerce) felicitates Mr. Satish Kaushik (Actor and Filmmaker) for his Haryanvi Movie- ‘Chhoriyan Chhoron Se Kam Nahi Hoti’ Special Screening held on Saturday, 15th June, 2019 at PHD House, New Delhi.
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