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Tuesday 30 April 2019

Silver futures fall to Rs 37,291 per kg

Silver prices were trading down by Rs 227 to Rs 37,291 per kg in futures trade on Tuesday after speculators reduced their exposure to book profits.

Silver for delivery in May contracts fell by Rs 227, or 0.61 per cent, to trade at Rs 37,291 per kg in a business turnover of 8,657 lots on the Multi Commodity Exchange.

On similar lines, the white metal for delivery in July contracts shed Rs 247, or 0.65 per cent, to Rs 37,865 per kg with a business turnover of 13,745 lots.

In the international market, however, silver rose 0.81 per cent to USD 14.96 an ounce in Singapore.

Marketmen said trimming of positions by speculators to book profits at prevailing levels, mainly led to the fall in silver prices here.

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Source: Moneycontrol

Gold futures fall 0.31% on weak domestic cues

Gold prices traded lower 0.31 per cent to Rs 31,841 per 10 gram in futures trade Tuesday after participants cut positions amid a weak global trend.

On the Multi Commodity Exchange, gold for delivery in June contracts was trading lower by Rs 98, or 0.31 per cent, at Rs 31,841 per 10 gram in a business turnover of 13,091 lots.

Similarly, gold to be delivered in August contracts fell by Rs 107, or 0.33 per cent, to Rs 32,005 per 10 gram in 3,623 lots.

Analysts said off-loading of positions by traders following a weak trend overseas influenced gold prices in futures trade.

Meanwhile, however, gold prices was trading a notch up by 0.38 per cent to USD 1,283.45 an ounce in Singapore.

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Source: Moneycontrol

Crude oil prices up 0.93% on positive cues

Crude oil prices rose 0.93 per cent to Rs 4,450 per barrel in futures market Tuesday as speculators created fresh positions taking positive cues from the overseas market.

At the Multi Commodity Exchange, crude oil for delivery in May contracts rose by Rs 41, or 0.93 per cent, to Rs 4,450 per barrel in a business turnover of 17,931 lots.

Crude to be delivered in June contracts also gained Rs 37, or 0.83 per cent, to trade at Rs 4,469 per barrel in 518 lots.

Analysts said speculators widened positions in domestic market after global oil prices gained steam.

A couple of bullish oil price forecasts also led to speculators widening positions.

Globally, West Texas Intermediate for June contracts delivery gained 0.22 per cent to USD 63.64, while Brent crude rose 0.32 per cent to USD 72.27 per barrel.

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Source: Moneycontrol

Cotton prices to trade sideways to lower: Angel Commodities

MCX cotton traded in a narrow range last week and gain a little to close at 22,190 rupees per bale due to steady demand and reports of higher imports. In April, cotton prices increased to highest levels in 2019 but slipped due to forecast of near normal monsoon and expectation of higher sowing in the next season. India 2019/20 cotton output to increase about 7% yr/yr to hit five-year high of 6.4 mt on higher yields, acreage, according to USDA attaché report. Moreover, India is losing cotton export market to Brazil due to higher prices and stronger rupees. CAI trims cotton crop size to 321 lakh bales for 2018/19 season, lowest since 2009-10 which will increase imports and decline exports.

Outlook

Cotton futures expected to trade sideways to lower tracking weakness in International cotton prices and reports of higher production expected next year. Moreover, forecast of near normal monsoon, improving in imports and decreasing exports may be bearish for prices.

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Source: Moneycontrol

63 Moons surges 10% after SC rejects merger with NSEL

Shares of 63 Moons Technologies surged 10 percent intraday on April 30 after the supreme court set aside the merger with National Spot Exchange (NSEL).

According to media reports, the supreme court set aside the merger as it doesn't satisfy the criteria of "public interest". The court added that it has laid down what constitutes public interest.

The merger was proposed by the government in 2016 and was the first case when the centre passed the merger order of two private companies in "public interest".

NSEL is a subsidiary of 63 Moons Technologies.

At 1101 hrs, 63 Moons Technologies was quoting Rs 124.95, up 9.99 percent on the BSE.

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Source: Moneycontrol

Gold gains as disappointing China data bruises Asia stocks

Gold rose on Tuesday as a lacklustre Chinese manufacturing activity data pushed Asian shares down, rekindling concerns about the health of the global economy.

Meanwhile, investors braced for a raft of euro zone data and U.S. Federal Reserve's two-day policy meeting, which begins later in the day.

Spot gold was up 0.2 percent at $1,282.08 per ounce at 0318 GMT. U.S. gold futures were up 0.2 percent at $1,283.90 an ounce.

"There is a broad bearish sentiment across Asia market opening this morning as a very disappointing China manufacturing PMI triggered a sell-off in currencies and emerging markets and equity markets," said Margaret Yang, an analyst with CMC Markets in Singapore.

Reading on the official Purchasing Managers' Index (PMI) in for manufacturing unexpectedly fell to 50.1 in April from March's reading of 50.5 stoking concerns about the economic state of China and pressuring Asian equities lower.

Gold is generally used by investors as a safe haven investment against economic and political concerns.

The metal has, however, come under pressure of-late as equity markets have hit record highs and most economic data from far and wide have pacified anxieties about the pace of global growth.

Gold is yet to overcome the bearish factors, and any rallies in the metal might will be short-lived, INTL FCStone analyst Edward Meir said in a note.

"We do not recommend establishing length at current levels on gold, given the lack of upside drivers. Although the dollar is not moving higher on the back of strong macro readings, it is not coming down either; neither are the U.S. long-term rates," Meir added.

The metal had retreated from a more than one-week high yesterday after Wall Street stocks were propelled to a record high by data showing U.S. consumer spending increased by the most in more than 9-1/2 years in March.

The technical trend has turned more bearish for gold, CMC Markets' Yang said.

Investors now await a raft of economic data from the euro zone and will also focus on the commencement of the Federal Open Market Committee (FOMC) meeting that will determine the future trajectory of interest rates in the U.S.

The U.S. central bank is widely expected to hold interest rates steady as policymakers balance recent stronger-than-expected U.S. economic growth against sluggish inflation.

Elsewhere, silver fell 0.1 percent to $14.89 per ounce, while platinum slipped 0.1 percent to $893.50.

Palladium, on the other hand, was up 0.2 percent at $1,372.69, having fallen by over 7 percent to bottom at $1,361.50 in the previous session.

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Source: Moneycontrol

Ambuja Cements to report Q4 earnings today; here's what brokerages are expecting

Cement major Ambuja Cements is scheduled to report its March quarter earnings on April 30. According to Prabhudas Lilladher, the company is expected to report net profit of Rs 312 crore, up 14.8 percent year-on-year, (up 29.2 percent quarter-on-quarter).

Net Sales is expected to increase 6.9 percent Y-o-Y (up 6.9 percent Q-o-Q) to Rs 2,954.5 crore, while earnings before interest, tax, depreciation and amortisation (EBITDA) is likely to jump 12.1 percent Y-o-Y (up 49.5 percent Q-o-Q) to Rs. 456.7 crore, the report added.

ICICIdirect expects Ambuja Cements to report net profit of Rs 294.8 crore up 8.5 percent year-on-year (down 45.1 percent quarter-on-quarter). Net Sales is expected to increase 4.6 percent Y-o-Y (up 4.6 percent Q-o-Q) to Rs 2,995.2 crore. EBITDA is likely to rise 1.7 percent Y-o-Y (up 27.7 percent Q-o-Q) to Rs 515.8 crore, it said.

The infrastructure and the government’s ‘Housing for All’ initiative led to 9 percent growth in the cement industry in CY18, said Motilal Oswal. However, Ambuja Cements' profitability took a hit due to increased raw material and fuel prices, it said. Cash flow from operations before taxes and working capital changes declined 6 percent to Rs 1,810 crore in CY18. The research firm has maintained a neutral stance on the stock.

Emkay Global Financial Services expects Ambuja Cements to report volume growth of 4 percent YoY. It remains underweight on Ambuja Cements.

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Source: Moneycontrol

Oil dips as rising OPEC, US output seen making up for Iran sanctions shortfall

Oil prices dipped on Tuesday on expectations rising output from the United States and producer club OPEC would offset most of the shortfall expected from U.S. sanctions on Iran, but analysts said markets remained tight.

Brent crude futures were at $71.86 per barrel at 0103 GMT, down 18 cents, or 0.3 percent, from their last close.

U.S. West Texas Intermediate (WTI) crude futures were at $63.42 per barrel, down 8 cents from their previous settlement.

Oil prices surged by around 40 percent between January and April, lifted by supply cuts led by the Middle East-dominated producer club of the Organization of the Petroleum Exporting Countries (OPEC) as well as by U.S. sanctions on producers Iran and Venezuela.

But prices came under downward pressure late last week after U.S. President Donald Trump openly pressured OPEC and its de-facto leader Saudi Arabia to raise output to meet the supply shortfall caused by the tightening Iran sanctions.

Stephen Innes, head of trading at SPI Asset Management, said the producer group "will want to avoid at all cost oil prices surging to levels that will trigger demand devastation, (while) it is clearly in OPEC's best interest to maintain a solid floor on prices".

Bank of America Merrill Lynch said "Iranian oil production will fall to 1.9 million barrels per day in 2H19 from 3.6 million barrels per day in 3Q18 as U.S. sanctions kick in and waivers eventually expire".

Despite this, the bank said it expected "a nearly balanced market in 2019" as output from OPEC and also the United States will rise.

French bank BNP Paribas said it expected oil prices "to rise in the near-term" as crude producers were "over-tightening the market in the face of unplanned supply outages and resilient oil demand".

The bank said it expected crude markets to climb until the third quarter of 2019, adding that prices would then "start to become vulnerable to a sharp rise in U.S. exports of light crude thanks to pipeline and terminal capacity expansion".

U.S. exports exceeded 3 million barrels per day (bpd) for the first time in early 2019 amid a more than 2 million bpd production surge over the past year, to a record of more than 12 million bpd.

BNP Paribas said it saw WTI averaging $63 per barrel in 2019, up $2 from its previous forecast, while Brent will average $71 per barrel, up $3 from an earlier estimate.

"In 2020, we see WTI averaging $64 per barrel and Brent $68 per barrel," the bank said.

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Source: Moneycontrol

Kotak Bank Q4 preview: Net profit, NII expected to grow in double digits

Kotak Mahindra Bank, which is slated to report its fourth quarter results on April 30, is expected to clock in highest profit growth in eight quarters aided by strong net interest income (NII) growth.

Research firm Motilal Oswal expects the bank to report net profit of Rs 1,388 crore up 23.5 percent year-on-year (up 7.5 percent quarter-on-quarter). Net Interest Income (NII) is expected to increase 21.2 percent Y-o-Y (up 6.4 percent Q-o-Q) to Rs 3,126.2 crore.

Pre Provision Profit (PPP) is likely to jump 22.8 percent Y-o-Y (up 27.8 percent Q-o-Q) to Rs 2,477.3 crore.

Key things to watch:

-Net interest margins expected to be above 4.2 percent; loan growth above 20 percent, according to CNBC-TV18 Poll

-Low-cost deposit flow should be strong for the bank

-Continued improvement in GNPA for eighth quarter in a row will be positive for the bank

According to a Deutsche Bank report, net interest income is seen at Rs 4114.5 crore against Rs 3388.6 crore, up 21.4 percent while net profit is seen at Rs 2082.5 crore against Rs 1789.2 crore, up 16.4 percent.

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Source: Moneycontrol

Yes Bank plunges 27% on weak Q4 result; Macquarie, HSBC & Citi downgrade stock

Shares of Yes Bank plunged 27 percent in the early trade on April 30 after company reported weak set of numbers for the quarter ended March 2019.

The company has reported a net loss in the quarter ended March 2019 on the back of spike in bad loans. Analysts have mixed view on the stock and are expecting 5-10 percent fall in share prices on April 30.

On April 26, the company reported quarterly loss of Rs 1,507 crore as compared to Rs 1,179.44 crore in the quarter ended March 2018.

Net interest income, the difference between interest earned and interest expended, grew 16.3 percent year-on-year to Rs 2,506 crore with credit growth at 18.7 percent, but net interest margin contracted by 30 bps.

Macquarie: Downgrade to Underperform| Target: 165

Macquarie has double-downgraded Yes Bank stock to Underperform with a target price of Rs 165 which translates into a downside of 30 percent from current levels.

"We must eat humble pie today and admit we underestimated risks in structured finance. We got the call wrong. We draw upon our learnings from how Axis Bank handled its watchlist disclosures, and now built in a significantly more conservative slippage and credit cost estimate over FY20-22E, more than double the management’s guidance," Macquarie said in a note.

Over the past eight years we have been constructive on YES Bank’s ability to not just survive, but to thrive in a risky business segment like structured finance, the global investment bank said.

Macquarie slashed FY20-21E EPS by 45 percent each. "We have built in capital raise of Rs 35 billion at Rs 200/share in FY20."

The stock may trade 5-10% gap down on April 30 when markets reopen, said Sameer Kalra, Founder & President (Research), at Target Investing. "We still have buy rating on the company and lower weight since recent run up."

The results have taken a hit due to proactive provisioning by the new management with two major accounts almost fully provided for and some high risk accounts.

The cost of credit increased and might be elevated for next two quarters on reversal on certain high risk high return accounts which turned bad assets. We see results as positive step forward on cleaning the balance sheet which might be at expense of short-term profit, he added.

Manali Bhatia, Senior Research Analyst at Rudra Shares & Stock Brokers feels that the stock would see sharp fall of 5-7%. However, we advise investors to not panic and to hold the stock, even buy on every dip, keeping in mind medium-to-long-term perspective.

To maintain higher quality, strong balance sheet and cleanup process, bank has increased total provisions to Rs 3,662 crore.

This move by the management though is a one-time pain, but it can be rightly stated that bank is on the verge of cleaning and strengthening its balance sheet by equally maintaining quality, she added.

Prabhudas Lilladher, on the other hand, has maintained reduced rating on the stock with a target of Rs 190 per share.

The earnings were disappointing on the back of management (likely on conservative CEO) recognizing large NPAs of Rs 34.8 billion from aviation, infra and real estate space.

Sumit Bilgaiyan, Founder at Equity99 recommended investors to stay invested in the stock for couple of more quarters despite the recent headwinds.

The bank has undergone a significant transition in its senior management, we believe that the bank’s performance in near term will remain dampened as such huge transitions are painfully slow but necessary for the bank to revive in a meaningful way and this pain will be temporary blip and will lead to a strong revival in bank’s performance over near-to-medium term, he added.

He sees sizable earnings downgrade post the result.

Broking house Sharekhan has maintained buy rating on the stock with a revised price target of Rs 275 per share.

The bank posted weak results for Q4FY2019, with spike in NPAs, high provisions, lower other income impacting performance. Changes in business model, mix & strategy may see growth and return ratios moderating for a near to medium term, it added.

At 09:26 hrs Yes Bank was quoting at Rs 177.55, down Rs 59.85, or 25.21 percent on the BSE.

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Source: Moneycontrol

Stocks in the news: Yes Bank, Hero Moto, Ambuja Cements, GMM Pfaudler, JSW Energy

Here are the stocks which are in news today:

Results on April 30: Ambuja Cements, TVS Motor, Kotak Mahindra Bank, Ajanta Pharma, BASF, Can Fin Homes, CONCOR, Exide Industries, Godrej Properties, Gammon India, Gruh Finance, Raymond, Shoppers Stop

Persistent Systems Q4: Net profit down 7.6% at Rs 84.47 crore, dollar revenue down 2% at USD 118.30 million, QoQ

Yes Bank Q4: Net loss of Rs 1,506.6 crore against profit of Rs 1,179.4 crore, NII up 16.3% at Rs 2,505.9 crore versus Rs 2,154.3 crore, YoY.

Hero Motocorp Q4: Net profit fell 24.5% at Rs 730.3 crore versus Rs 967.4 crore, revenue down 7.9% at Rs 7,885 crore versus Rs 8,564 crore, YoY

Castrol India Q4: Net profit up at Rs 185 crore; revenue up 5.3% at Rs 976.2 crore.

NTPC to start commercial operations at its Gadarwala plant w.e.f. April 30

Cipla receives final approval for generic version of Gilead Sciences, Inc’s Letairis

NHPC signs a memorandum of understanding (MoU) with Indian Army for undertaking construction of semi underground bunkers and fully underground caverns at different locations in India

Bank of Maharashtra Q4: Net profit at Rs 72.4 crore versus loss of Rs 113.5 crore, Gross NPA at 16.40 percent against 17.31 percent, QoQ

OnMobile Global incorporates subsidiary company OnMobile Bangladesh Technologies

HCL Technologies partners with Cherwell Software

Shanthi Gears recommended final dividend of Re 1 per equity share

Glenmark launches novel, globally‐researched anti‐diabetes drug Remogliflozin in India

Reliance Nippon Life Asset Management declared interim dividend of Rs 3 per equity share

NBCC submitted a revised resolution plan in respect of Jaypee Infratech to the Interim Resolution Professional

Kotak Mahindra Investments, a wholly owned subsidiary of Kotak Mahindra Bank, completed the sale of its entire equity stake in Matrix Business Services India

Fire broke out in the paints factory of Kamdhenu at Rajasthan

Shankara Building Products approved partial sale of assets including land, building and equipment of Taurus Value Steel & Pipes

Cholamandalam Investment and Finance Company approved subdivision of equity shares

NHPC signs a memorandum of understanding (MoU) with Indian Army for undertaking construction of semi underground bunkers and fully underground caverns at different locations in India

Greaves Cotton to consider Q4 results and proposal for buyback of equity shares on May 2

Precision Camshafts approved to initiate liquidation of a wholly owned subsidiary company PCL (Shanghai) Co

Acuite Rating & Research assigned Acuite BBB- and Acuite A3 rating for long term and short term bank facilities of Mukand

Cipla's wholly owned subsidiary Cipla Medpro South Africa (Pty) completed closing of transaction and acquired 30% stake in Brandmed (Pty)

GMM Pfaudler completed the acquisition of the IMSD of Sudarshan Chemical Industries

JSW Energy secured a purchase order from Telangana State Discoms of 300 MW

Eclerx Services approved buyback price at Rs 1500 per share, and the aggregate amount of buyback upto Rs 2,620 million.

Minda Industries has issued the Commercial Paper of Rs 30 crore

TVS Motor to invest Rs 63,268 in Altizon Systems

HPCL-MRPL merger hits cash hurdle; ONGC rules out share swap: PTI

Avenue Supermarts issued commercial papers of Rs 20 crore

Garden Reach Shipbuilders entered in to contract with GOI for construction and delivery of 8 ASW Swallow Water Craft at an estimated cost of Rs 6,311.32 crore

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Source: Moneycontrol

Market Live: Sensex, Nifty open flat with negative bias; Yes Bank tumbles 27%

Market Opens: It is flat start for the Indian Indices on April 30. The Sensex is down 60.31 points at 39007.02, while Nifty is down 27.20 points at 11727.50. About 351 shares have advanced, 409 shares declined, and 61 shares are unchanged.

Maruti Suzuki, Yes Bank, Bharti Infratel, IndusInd Bank, Hero Motocorp, DHFL, L&T, PNB Housing, are among major losers on the indices, while gainers are ONGC, Grasim Industries, Wipro and Tech Mahindra.

Among sectors, Bank Nifty is under pressure with a fall of 1 percent. Auto and metal stocks are also trading lower.

Rupee Opens: The Indian rupee gained in the early trade on Tuesday. It opened higher by 17 paise at 69.84 per dollar on Monday versus 70.01 Friday.

Market at pre-open: Benchmark indices are trading flat with positive bias in the pre-opening session on Tuesday.

The Sensex is up 27.60 points or 0.07% at 39094.93, and the Nifty down 4.70 points or 0.04% at 11750.00.

Yes Bank fell 10 percent in pre-opening trading.

Asian markets trade lower: Shares in Asia fell on Tuesday despite another record high close for the S&P 500, as investors await a US Federal Reserve policy decision for clues of whether it will continue to take a "patient" approach to interest rate policy.

Brokerages View: Source: CNBC-TV18

CLSA on Hero Motocorp

Retain sell call, target cut to Rs 2,375 from Rs 2,400 per share

2-wheeler demand has weakened post the new insurance norms in September

Cost push from regulatory changes over next 1-year will be a further drag

PhillipCap on Hero Motocorp

Maintain neutral, target raised to Rs 2,811 from Rs 2,700 per share

2-wheeler yet to recover from negative impact of insurance & safety regulations

Jefferies on Hero Motocorp

Hold Rating, target raised to Rs 2,530 from Rs 2,550 per share

Q4 result largely in-line with margin of 13.6%

Morgan Stanley on Hero Motocorp

Underweight call, target at Rs 2,459 per share

EBITDA growth may be weak due to competitive & regulatory pressures

Key to monitor will be market share in scooters & premium bikes

Credit Suisse on Hero Motocorp

Outperform call, target at Rs 2,920 per share

Subdued Q4; weakness likely to continue but valuations favourable

CITI on Hero Motocorp

Buy Call, target cut to Rs 3,250 from Rs 3,350 per share

Cut FY20 EPS estimates by 10% due to subdued vol growth expectations & lower margin

FY21 EPS estimates are increased by 4%, reflecting effective pricing strategy

Nomura on Hero Motocorp

Neutral call, target at Rs 2,725 per share

Q4 in-line; demand outlook remains weak

Macquarie on Hero Motocorp

Outperform call, target at Rs 3,000 per share

PAT declined due to production cuts to correct elevated channel inventory

Nomura on HDFC Life

Protection & annuity growth strong

Valuations remain our only constraint

Maintain neutral call, target raised to Rs 435 per share

Morgan Stanley on HDFC Life

One of the best plays on India's insurance story in the medium term

FY19 saw strong VNB growth helped by continued performance in protection/annuities

Equal-weight call, target at Rs 380 per share

Macquarie on HDFC Life

Neutral call, target at Rs 400 per share

Falling wallet share from HDFC Bank drags Q4

Reported 17% YoY growth in APE, led by a 3.5x rise in group APE

Macquarie on Yes Bank

Double-downgrade to underperform, target cut to Rs 165 from Rs 231 per share

Cut EPS estimate by 45%

Deutsche Bank on Yes Bank

Buy call, target cut to Rs 245 from Rs 330 per share

Q4 was a clean-up act; may see softer earnings in the near term

Credit Suisse on Yes Bank

Neutral Call, target at Rs 205 per share

Cut EPS estimate by 50%

Q4FY19 indicates commencement of clean-up process

CITI on Yes Bank

Downgrade to sell, target cut to Rs 180 from Rs 240 per share

Co faces twin challenges of profitability & capital

HSBC on Yes Bank

Downgrade to reduce, cut target to Rs 164 from Rs 243 per share

Reported its first quarterly loss since FY06

Asset quality deteriorated significantly

Morgan Stanley on Yes Bank

Underweight call, target cut to Rs 125 from Rs 160 per share

Expect a gradual turnaround under the new CEO

See 0.7-0.9% ROA in next 3 years

Credit Suisse on Sun Pharma

Downgrade to neutral, target cut to Rs 470 from Rs 515 per share

Cut FY19-21 EPS estimate by 7-10%

S&P 500 hits record high: The S&P 500 set an intraday record high on Monday, bolstering the view that the decade-long bull market has further to run, after consumer spending rose in March and inflation data was benign.

SGX Nifty: Trends on SGX Nifty indicate a negative opening for the broader index in India, a fall of 27.5 points or 0.23 percent. Nifty futures were trading around 10,842 - level on the Singaporean Exchange.

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Source: Moneycontrol