Shrikant Chouhan, Head of Equity Research (Retail), Kotak Securities
There is pessimism in the markets as weak global economic outlook along with the pressing geo-political tension and the dangling rate hike worries has given investors the ammunition to exit equities at will.
Also, the US FOMC minutes outcome later this week is already making investors nervous on concerns that the Fed could be going more rate hikes to keep a leash on rising inflation menace.
Technically, after a muted opening the index corrected sharply and breached the important support level of 17150. Long bearish candle on daily charts and lower high formation on intraday charts is indicating further weakness from the current levels.
The correction wave is likely to continue till 16850-16800. On the flip side, 17050 would be the key intraday resistance zone, above which a minor pullback rally is possible till 17100-17125.
Rupak De, Senior Technical Analyst at LKP Securities
Nifty witnessed selling pressure in the second half of the session. On the daily chart, the index has slipped below the psychological 17000 mark. Besides, the Nifty fell below 200DMA briefly before closing a bit higher.
The trend looks weak, a fall below 16980 may trigger a selling pressure in the market with a potential to fall towards 16800. On the higher end resistance is visible at 17100.
Gaurav Ratnaparkhi, Head of Technical Research, Sharekhan by BNP Paribas
The Nifty has been witnessing a short term consolidation, within which it is oscillating with sharp swings in both the directions. A minor degree bounce in the last week fizzled out near the 50% retracement of the entire September decline as well as near the key daily moving averages. Thereon, the index started sliding down again.
On October 11, the index has breached the level of 17000 on a closing basis. Thus it is set to test the swing low, which is near 16750.
The Nifty is expected to attract buying support again near the support zone of 16800-16750. On the higher side, the zone of 17250-17300 kept the bounce in check for the last couple of sessions & can continue with its role of resistance in the short term.
Anindya Banerjee, VP, Currency Derivatives & Interest Rate Derivatives at Kotak Securities
USDINR spot closed flat at 82.31, after suspected RBI intervention capped its advance. Over this week, important data points are: FOMC minutes and US CPI inflation.
A strong than expected core inflation can push USDINR towards 82.80 levels. Over the near term, we expect a range of 81.80 and 82.80 on spot.
Wright Research raises $1 million in Seed Funding from Orios Venture Partners:
Quant and AI-driven Investment Advisor Wright Research has raised 1 million dollars as seed capital from Orios Venture Partners.
The company plans on using these funds for business expansion, bolstering the technology stack, and accelerating its foray into institutional fund management.
Ajit Mishra, VP - Research, Religare Broking:
Markets remained under pressure and lost nearly one and a half percent amid the prevailing corrective phase. After the flat start, the Nifty index gradually drifted lower as the session progressed and slipped below the support of 17,100 levels to finally settle around the day’s low at 16,983.55 levels.
Pressure in the IT pack combined with a slide in index majors across sectors was weighing on the sentiment. In line with the move, the broader indices too witnessed a decline and lost nearly 2% each.
As we’re not seeing any respite on the global front, any disappointment on earnings or the macroeconomic front may put further pressure. On the index front, we are now eyeing 16,800 in Nifty and its decisive break would reverse the recovery trend. Traders should align their positions accordingly.
Palak Kothari, Senior technical analyst at Choice Broking:
Indian equity benchmarks traded lower on Tuesday, extending their fall for the third straight session amid weak global cues. Asian shares slipped today, tracking an overnight decline on Wall Street.
On the domestic front, market participants also awaited September's retail inflation data, due to be released on Wednesday.
Nifty closed below the 17000 level at 16983.55 level with a loss of 257.45 points, while the Bank Nifty closed the session at 38712.45 level with a loss of 380.65 points.
On the technical front, the Nifty formed a Bearish Marabozu on daily charts which suggests weakness in the counter. Nifty has given a closing below the middle band of Bollinger as well as 21 DMA which adds bearishness to the prices. The Hourly momentum indicator STOACHSTIC & MACD were trading with a negative crossover which suggests a downside moment in the upcoming session.
The support for Nifty has shifted around 16800 levels while on the upside 17250 may act as an immediate hurdle. On the other hand, Bank Nifty has support at 38200 levels while resistance at 39500 levels.
Overall, Nifty can test the support level breaching below the same can show more downside rally.
S Ranganathan, Head of Research at LKP securities:
India's outperformance till date made a case for profit booking for the FIIs today as geopolitical and currency risks came to the forefront.
Practically all sectoral indices ended in the red with the Nifty closing below 17k on a day when nothing was spared.
The broader markets too saw a steep correction in several stocks which have been defying gravity and moving up since the past several weeks.
Vinod Nair, Head of Research at Geojit Financial Services:
Investors are becoming risk-averse due to rising geopolitical turmoil as well as worries about the global economic slump. Investors' caution ahead of the announcement of inflation data prevented a better-than-expected start to IT earnings from improving market mood.
However, as compared to global counterparts, domestic selling is not as aggressive since FII selling is primarily absorbed by DIIs.
Rupee Close:
Indian rupee closed flat at 82.32 per dollar against previous close of 82.32.
Market Close:
Indian benchmark indices ended lower for the third consecutive session with Nifty finishing below 17,000 level.
At Close, the Sensex was down 843.79 points or 1.46% at 57,147.32, and the Nifty was down 257.50 points or 1.49% at 16,983.50. About 1036 shares have advanced, 2291 shares declined, and 133 shares are unchanged.
Divis Labs, IndusInd Bank, Nestle India, JSW Steel and Eicher Motors were among the top Nifty losers. Axis Bank, Adani Enterprises and Asian Paints were the top gainers.
All the sectoral indices ended in the red with auto, metal, IT, oil & gas and realty indices down 1-3 percent.
BSE midcap and smallcap index fell over 1 percent each.
Inox Wind arm sells 3 special purpose vehicles
Inox Wind's subsidiary Inox Green Energy Services sold entire equity shareholding held in Wind One Renergy, Wind Three Renergy and Wind Five Renergy, to Adani Green Energy.
All three special purpose vehicles successfully commissioned 50 MW each of SECI Tranche 1 in 2019. Inox Wind had won 250 MW under the Tranche 1 of Solar Energy Corporation of India's (SECI -1) bids for wind power projects at Dayapar, Gujarat connected on the central grid, at a fixed tariff of Rs 3.46 per unit for 25 years for sale to PTC India.
Inox Wind was quoting at Rs 152.45, down Rs 3.50, or 2.24 percent.
Nifty Information Technology index fell 1 percent dragged by the Infosys, HCL Tech, Tech Mahindra
KRChoksey View on Tata Consultancy Services
Tata Consultancy Services (TCS) is currently trading at a valuation with a P/E multiple of 26x/22.0x on FY23E/FY24E earnings. In spite of continued global macro uncertainties, TCS is well positioned with its size, steadfast market leadership position, best-in-asset class execution and order book (especially exposure to longer duration contracts) to deliver industry leading growth/margin and demonstrate superior return ratios and hence we continue with the same target price of Rs 3,739 with a P/E multiple of 27.5x to the FY24 with an estimated EPS of ~ Rs 136, an upside of 19.8% over the CMP.
Accordingly, we upgrade to “Buy” rating from “Accumulate” to the stock due to lower base effect.
Credit Suisse View on TCS:
Research firm Credit Suisse has kept its 'neutral' rating on the stock with a target Rs 3,300 per share.
There was a strong revenue growth & margin improvement in Q2, however, FY24 demand scenario is still uncertain.
The growth was led by BFSI, 4 percent CC revenue growth QoQ & retail growth of +4.1 percent. Also, the UK/Europe business surprised positively & US remained steady.
The deal momentum was also steady, TCV was flat QoQ at USD 8.1 billion. The margin was benefitted from operational efficiencies and currency.
Credit Suisse raises FY23-FY25E EPS by 2-4 percent to a/c for better margin & currency benefits, reported CNBC-TV18.
BSE Fast Moving Consumer Goods index fell 1 percent dragged by the United Spirits, GM Breweries, Varun Beverages
CLSA View on TCS:
Brokerage house CLSA has kept the 'outperform' rating on the stock with a target Rs 3,450 per share as the Q2 was in-line with estimates, with near-term revenue outlook intact & supply pressure abating.
However, long-term demand outlook does soften, but not alarming. Increased confidence in margin management, said CLSA.
The company’s ability to structure large cost-takeout deals should help gain market share, reported CNBC-TV18.
JSW Cement is going to invest over Rs 3,200 crore in new Madhya Pradesh facility and set up split grinding unit in Uttar Pradesh, reported Bloomberg.
JSW Cement combined capacity of both units will be 5 mtpa, it added.
Market at 3 PM
Benchmark indices extended the losses and trading at day's low with Nifty around 17000.
The Sensex was down 744.77 points or 1.28% at 57246.34, and the Nifty was down 234.50 points or 1.36% at 17006.50. About 1029 shares have advanced, 2148 shares declined, and 115 shares are unchanged.
Power Grid acquires ER NER Transmission
Power Grid Corporation of India, pursuant to its selection as the successful bidder under Tariff based competitive bidding, has acquired ER NER Transmission Limited (ETL), the Project SPV to establish Inter-State Transmission System for System Strengthening Scheme for Eastern and North Eastern Regions, on build, own, operate and transfer (BOOT) basis from the Bid Process Coordinator - REC Power Development and Consultancy Limited.
Power Grid Corporation of India was quoting at Rs 209.80, up Rs 0.85, or 0.41 percent on the BSE.
Rupee Updates:
Indian rupee is trading marginally lower at 82.37 per dollar against previous close of 82.32.
Jefferies View on TCS:
Broking firm Jefferies has maintained the 'hold' rating on the stock and raised the target to Rs 3,180 per share as the Q2 is ahead with revenues, margin and profits beating estimates.
The deal wins at $8.1 billion was steady on-year. The high subcontracting with lower net hiring reflects the management’s caution.
Jefferies raises FY23-25 estimates by 2-5 percent to factor in the rupee depreciation against the dollar. It expect TCS to deliver 12 percent EPS CAGR over FY22-24.
The company’s premium valuations may limit upside, reported CNBC-TV18.
Suzlon to weigh selling off non-core assets after Rs 1,200-crore rights issue
Suzlon Energy Ltd will think of divesting its non-core assets after the scheduled rights issue, CFO Himanshu Mody told reporters on October 11. The Rs 1,200-crore rights issue of the wind turbine maker, which suffered the sudden loss of its founder-chairman Tulsi Tanti on October 1, opened on October 11 and will close on October 20.
“There are a few non-core assets that have been identified by the management for divestment. Upon the completion of the rights issue, the board of the company will be meeting at the end of this month or early November to consider and approve second quarter results. The next steps to be initiated on those non-core assets and the timelines within which they should be divested, if at all they would be divested, could be considered by the board,” Mody said at the company’s first press conference after the demise of Tulsi Tanti.
European Markets Updates
Brigade Enterprises: MR Jaishankar to step down as MD of company from October 11, 2022 and will continue as executive chairman of the firm.
Market update at 2 PM: Sensex is down 361.36 points or 0.62% at 57629.75, and the Nifty shed 118.30 points or 0.69% at 17122.70.
BSE Capital Goods index fell 0.5 percent dragged by the Suzlon Energy, BHEL, Praj Industries
ITD Cementation secures orders worth Rs 1,755 crore
ITD Cementation India has secured orders worth ~ Rs 1,755 crore, including construction of West Container Terminal in the Port of Colombo, Sri Lanka, construction of Berth and Yard facilities at Dhamra Port (2 packages) in Odisha and piling and civil work for Coke Oven Project at Hazira plant in Gujarat.
Here are the stocks are locked on the upper circuit or have only buyers; Click to View More
Tracxn Technologies IPO Updates:
The initial public offering of Tracxn Technologies, a global market intelligence provider, has garnered bids for 38 percent or 82.74 lakh shares against an IPO size of 2.12 crore shares on October 11, the second day of bidding.
Retail investors bought 1.97 times of the allotted quota, while non-institutional investors have bid for 11 percent or 6.37 lakh of the number of shares allotted to them. Qualified institutional buyers have not started bidding yet.
The company had lowered its offer size to 2.12 crore shares from 3.86 crore shares after mobilising Rs 139 crore through anchor book last Friday.
Nifty PSU Bank index shed 1 percent dragged by the PNB, Canara Bank, Indian Bank
NCLT admits Axis Bank's insolvency petition against GVK Power subsidiary
This is to inform you that the National Company Law Tribunal (NCLT), Hyderabad Bench, during its hearing on 10-10-2022 had admitted an insolvency proceedings petition filed under The Insolvency and Bankruptcy Code, 2016 by the Axis Bank against GVK Power (Goindwal Sahib) Limited, a step down subsidiary of the company.
The complete judgment orders of the NCLT are yet to be received and upon receipt of the same, the said subsidiary company intends to approach the conceded Appellate Authority within the stipulated time.
In no relief is given to that company by the appellate authority, the Insolvency Resolution Professional (RP) will immediately take charge of the affairs of GVK Power (Goindwani Sahib) Limited in terms of the IBC.
JSW Energy gets LoI for 126 MW Chhatru HEP from govt of Himachal Pradesh
JSW Neo Energy Limited, a wholly-owned subsidiary of JSW Energy Limited, has received a Letter of Intent from the Government of Himachal Pradesh for allotment of 126 MW Chhatru Hydro Electric Power Plant (HEP) on BOOT basis, with an operational life of 40 years.
JSW Energy was quoting at Rs 337.20, down Rs 8.50, or 2.46 percent on the BSE.
IndusInd Bank Large Trade | 1.2 crore shares (1.6% equity) worth RS 1,442.4 crore change hands at Rs 1,176 per share
GM Breweries Q2
GM Breweries has posted 4 percent jump in Q2 net profit at Rs 22.7 crore versus Rs 21.8 crore and revenue was up 22.3% at Rs 141.9 crore versus Rs 116 crore, YoY.
Market at 1 PM
Indian benchmark indices were trading in the red amid volatility.
The Sensex was down 250.41 points or 0.43% at 57740.70, and the Nifty was down 82.20 points or 0.48% at 17158.80. About 1315 shares have advanced, 1794 shares declined, and 124 shares are unchanged.
Today’s Stock Market Action
Citi View on TCS:
Brokerage house Citi has retained the 'sell' rating on the stock and raised the target price to Rs 2,900 per share as good Q2 and UK/India drives the beat.
The deal TCV at USD 8.1 billion versus past 4 quarter average of USD 8.7 billion, up 7 percent, YoY. The demand sustainability is a key, management commentary was mixed, reported CNBC-TV18.
Tata Consultancy Services was quoting at Rs 3,075.00, down Rs 46.20, or 1.48 percent on the BSE.
Motilal Oswal View on India Cements
We expect gross/net debt of ICEM to be at INR21.9b/21.6b in FY24E v/s our current estimate of INR26.4b/26.2b. This will lead to EPS of INR6.8 in FY24E v/s INR6 earlier.
Expectations of consolidation in the cement sector has led to an upside in the stock (up 42% after 1Q results) despite significant pressure on earnings (EBITDA/t expected to be at INR18 in 2QFY23). Valuations at 15.8x FY24E EV/EBITDA and USD82 EV/t appear unattractive, given the absence of capacity addition plans and high net debt/EBITDA (3.2x in FY24E revised). We reiterate our Sell rating on the stock with a price target of INR180 (v/s INR165 Earlier).
India Cements sells Springway Mining for Rs 477 crore to JSW Cement
India Cements has sold its entire shareholding in Springway Mining to JSW Cement. It has entered into a Share Purchase Agreement with JSW Cement and divested the entire shareholdings for Rs 476.87 crore. With this, Springway Mining is ceased to be the wholly owned subsidiary of the company.
Motilal Oswal View on APL Apollo Tubes
We believe APAT’s earnings momentum would continue with: a) growing demand across segments, b) increased product penetration with the help of a robust distribution network, c) an increase in the share of VAP, thus driving margins, d) the introduction of Apollo Mart, and e) its market leadership position.
Improving operating leverage, growing share of VAP and addition of highmargin products from the Raipur unit are likely to result in an improvement in margin and higher cash generation.
We project a revenue/EBITDA/PAT CAGR of 11%/24%/32% over FY22–24, respectively. We value the stock at 34x Sep’24E EPS to arrive at our Target Price of Rs 1,330. Maintain BUY.
Creditors withdraw liquidation process of Prag
Tilaknagar Industries would like to update its stakeholders that following Standard Chartered Bank's (SCB) application dated October 06, 2022, for withdrawal of the application filed by them against Prag, Subsidiary of the company, the Liquidator of Prag, Ms. Dipti Mehta convened a stakeholders meeting on October 07, 2022 wherein 100% of the creditors voted in favour of the withdrawal and closure of the liquidation process of Prag.
Accordingly, the Liquidator of Prag, Ms. Dipti Mehta has on October 08, 2022, filed an application at NCLT- Mumbai, seeking withdrawal of the Petition filed by the financial creditor SCB and closure of the liquidation process and for reinstating the erstwhile Board of Directors for management of the operations of Prag.
Tilaknagar Industries was quoting at Rs 100.40, down Rs 1.25, or 1.23 percent on the BSE.
Market at 12 PM
Benchmark indices were trading lower with Nifty around 17200.
The Sensex was down 137.95 points or 0.24% at 57853.16, and the Nifty was down 45.70 points or 0.27% at 17195.30. About 1510 shares have advanced, 1552 shares declined, and 133 shares are unchanged.
