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Last Updated : Jan 06, 2016 09:47 AM IST | Source: CNBC-TV18

Telecom stocks, Sugar stocks, Cadila, Biocon, Hexaware in focus

Stocks that are likely to be in the focus today are: Cadila Healthcare, Biocon, Sugar Stocks, Telecom Stocks, Hexaware Technologies, Gokaldas Exports, Arshiya,Kirloskar Pneumatic Company, Narayana Hrudayalaya, Aditya Birla Nuvo, Kansai Nerolac Paints.

Cadila Healthcare: US FDA warning letter for Moraiya & Zyfine facilities. US FDA says Significant violation of CGMP regulations for finished pharma and APIs. Company's response on September 26 and December 26, 2014 lack sufficient corrective action. Reviewed receipt of addl correspondence between November 2014-November 2015.

US FDA on Moraiya facility is inadequate investigation into Warfarin tablet failures. Inadequate identification of root cause of failure of Warfarin. Persistent failures of Warfarin indicate mfg process not in state of control. Company should discuss any further work to remediate processes for Warfarin. Company needs to provide justification for continued production. Company needs to explain how they have ensured marketed product is safe.

US FDA on Zyfine facility is failure to establish written procedures. Found one file had been deleted in Karl Fischer data.

Telecom Stocks: Delhi High Court will hear telcos, TRAI today. Delhi HC ruled there will be no coercive action against telcos till today. TRAI imposed penalty of Re 1 per dropped call, upto max 3 calls per day. Financial impact on the industry could be 5-6 percent on the EBITDA. Stocks have fallen 8-10 percent since TRAI order was passed on October 16.

CLSA view is that Biocon reiterate sell call. December 2016 target of Rs 423. See continued pressure on base business. Continued pressure on base business leads to 3 percent EPS cut for FY17. Continued pressure on base business leads to 4 percent EPS cut for FY18. Reason for yet for another likely challenging year. Capacity constraints on insulin business. High R&D spend on key biosimilar programs. Near-term growth will continue to be driven by Syngene. Biosimilars in regulated markets to kick off only beyond FY19.

Sugar Stocks: Uttar Pradesh cabinet likely to take up sugarcane pricing policy on January 7. Uttar Pradesh Chief Minister Akhilesh Yadav may announce better price parity for sugarcane. UP SAP at Rs 280/quintal, FRP at Rs 230/quintal. UP govt had given subsidy of around Rs 30/quintal last year. UP Cabinet may provide subsidies to the difference between FRP & SAP. If govt subsidises difference between SAP & FRP, it will be a boost for UP sugar mills. Need to keep an eye on sugar prices which have been moving up.

Newspaper reports that Hexaware baring PE Asia is looking to sell 71 percent stake. Baring is looking at valuation of Rs 8,000 crore versus market capital of Rs 7,531 crore. Baring initiates talks with Capgemini and PE funds like Blackstone & Carlyle. Baring has not launched a formal auction for the sale. Baring had acquired 71 percent stake at Rs 126 - 135/share in 2013.

Gokaldas Exports board nod to sell land in Bengaluru, Hyderabad & Mysore. To sell Global Garments Unit III based in Bengaluru. To sell Balaji Fashion House based in Bengaluru. To sell 2 plots in Mysore & one in Hyderabad. Promoter, Blackstone, aims to reduce non-core assets. One step closer to goal of hiving-off non-core properties, value unlocking.   

News misunderstood of Arshiya International. Exchange announcement that company exited CDR. Market interpreted CDR news as company free from bankers. Learn that CDR failed; Stock will lose gains today.

Kirloskar Pneumatic delivery volumes at 34,000 shares; Delivery percent at 86 percent. Company has nearly 65 percent market share in CNG gas compression systems. Company supplies to industry leaders like IGL, MGL.

Narayana Hrudayalaya issue price fixed at Rs 250. Issue price fixed at higher end of price band. Raised Rs 184 crore from 15 anchor investors. Narayana Hrudayalaya was looking to raise Rs 600-613 crore. Mkt cap of Rs 5,094 crore at higher end of price band. Consolidated FY15 EPS was loss of 0.57.

The other stocks in focus are Aditya Birla Nuvo and Kansai Nerolac.

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First Published on Jan 6, 2016 09:46 am
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