Weekly Market Sentiment_21.10.2017

Markets closed the pre diwali session near all time high. Although the “Muhurat” trading did not bode well with the bulls. Global weakness pulled the markets and sentiment lower. Nifty has slipped below its newly conquered high of 10200. Diwali sentiment ruled the streets throughout the week. Results will continue going forward and stock specific theme is likely to play out. New listings – MAS Financial and Godrej Agrovet made stellar debuts on the market. Both the stocks got a 35% premium from the street on listing day.

Technically speaking the Friday pull back should give fresh legs and a much-needed breather. 10080 will hold a key support for the very short-term. 9970 being the 50 D EMA will provide intermediate support to Nifty. On the positive side if Nifty is to hold 10180 on a weekly closing basis, one may have a massive rally squeezing shorts and surprising a lot of scared bulls. Flip side of range breaks, if there is correction in the intermediate time, Nifty can easily test the lower end of the weekly range at 9700. A double bottom is in the making still, 10180 is the key level to watch on a closing basis.

Fundamentally, nothing has changed. If anything markets just got more expensive. Historically elevated valuations will continue to keep bulls on their toes. Complacency cannot be tolerated at this levels. Time is ripe for a black swan event. Liquidity fueled rallies do not bode well for investors and this seems to be the most hated bull market. P/E is still astonishingly high and continues to stay there around the 25x multiple. Result season is underway and it seems that Nifty will decide a trend based on these results.

Globally, minor unrest continues as North Korea keeps the world and its neighbors on their toes. Kim is giving sleepless nights but none of that has boiled down to the prices. DOW continues to scale all time new highs. 23k has come – something that nobody had foreseen. Liquidity is abundant and interest rates are low giving this rally fresh room to scale new highs.

Sector watch – Infra looks promising. Keep an eye on the Nifty Infra index and its components. Some of them are near crucial resistance. A break out is on the cards. Nifty metals seem the strongest but slightly over heated index. Metals must pause. Bank is the ugly kid on the block. Nifty Bank does not look in a hurry to scale new highs while Nifty has. Unless this divergence closes, rally will not be clean.

Weekly Markets Sentiment_14.10.2017

Markets ended on a strong footing for the week. It was early diwali on the streets as Nifty broke its previous high and was 9 points shy to hit 10200. The close is an all time high close for Nifty. Sentiment has been strong ever since the IIP and CPI numbers came out. Nifty sits strong at 10167 with its eyes firmly set on a final break out attempt. This will be markets 3rd attempt at 10170+ levels.

Technically speaking Nifty is looking good with a gap up opening on daily charts. Undercurrent seems strong enough to warrant a fresh rally. A close above 10200 will confirm 9700 zone to be an intermediate bottom, may be a pattern of double bottom will be in place. Still early days but technically Nifty does look good for fresh intraday spikes above 10200. Sustaining a close above this will be a thing to watch. Divergence continues as Nifty Bank is yet to take out its highs and Sensex is still a few points shy for an all time high.

Fundamentally, nothing has changed. Markets are still over valued. Multiples continue to be at all time highs across the board. Also FII continue to dump in cash markets, and DII continues to mop up supply with the dry powder it is sitting on. IPO market frenzy continues as people flock towards high valued IPOs. RIL came in with decent but doubtful results. The stock will react on Monday. It will be a wait and watch game as results season kicks in the coming days and weeks. This is will be the litmus test for all major companies and the market as a whole.

Globally DOW continues to be strong and over bought. Charts indicate a reluctant history where the market has risen almost all year around. Other parts of the world have a similar phenomenon. Barring a few local issues such as Brexit for UK and Catalan crisis for Spain, world seems a quieter place for now. But who knows when Kim strikes.

Banks are finally looking to lead this break out. Far from its new highs, one can bet on banks in the coming weeks. Nifty bank does seem it will test last highs if not break it. This year and season’s favorite metal stocks should see some traction continuing. Nifty metal looks to continue to scale new highs. Nifty energy will be one index to watch. Reliance should lead followed by HPCL. One can look at momentum bets in this index.

Weekly Markets Sentiment_07.10.2017

Markets closed firm for the week. Nifty was up almost 2% and is in striking distance of reclaiming 10k for the third time. Global markets stability and liquidity ensured markets remained stable throughout. Result season is about to kick in. RBI held rates unchanged and sighted a stricter environment. The policy was a non event altogether. Growth concerns were flagged however undertone was mildly positive. Sentiment has stabilized around our own markets. The scare of breaching 9700-9600 zone has temporarily subsided.

Technically speaking, Nifty is far from its resistance zone. Cannot be considered safe yet as still good 200 points need to be scaled. On the positive note Nifty is 200 points away from its recent lows of 9680. It has successfully tested and bounced back.  Momentum is still to reverse technically speaking but looks like markets could be headed higher to test 10100 on the Nifty. Immediate resistance stands at 10040 levels where Nifty should take a pause.

Fundamentally, nothing has changed. Multiples and valuations continue to remain stretched. Liquidity is abundant and hence market corrections are being bought. Small and mid-caps continue their dream run. When will the tap run dry? This is anybody’s call. India has recently under-performed its global peers. FII’s continue their cash selling spree. However, they have bought a lot of stock and index futures going into the new October expiry. Cash selling continues and is equally countered by local DIIs and MFs who seem to be having access to unlimited capital.

Globally DOW had a decent week. Bulls rampaged as it kept scaling new all time highs. DOW sits pretty at 22600+. US presidents tax reform proposals have sent a fresh wave of buying across US markets. Bulls have got yet another reason to party and justify valuations. North Korea for now seems to have calmed down, but one reckons only for now.

Sector wise, as pointed out Metals are strongest in the lot and they proved to be. Nifty metals have hit 3700+ and is likely to scale new peaks as globally commodities have a good time. One can trade momentum in Nifty Metal constituents. Nifty Energy seems to be on a roll. Keep an eye out for energy plays and the index will look to test its early peak of 13650+. OMC’s will be in the news and should be looked at for buying the dips. Pharma looks on track to hit  new highs as Nifty Pharma on back of support given by Sun should test 9800. Nifty Bank will continue to be the make-break index. It is clearly struggling to gain momentum. 24300, if taken out can give it fresh legs. Unless that happens it will drag the sentiment down.

Weekly Markets Sentiment_30.09.2017

Markets ended 2% down from previous weekly close. The 2 weeks leading to September ending have not thrown up good signals. Sentiment has gone for a toss. Weakness continues across the markets. No one has to guts to buy the dips. Nifty is down 3-4% from it’s all time highs. Sensex perhaps never made a significant top. Divergence has been magnified all across the places. Expiry week lived up to its expectations.

Technically speaking. Nifty is in a bad shape. 9900 is the crucial first level it needs to cross to stem the sell on rallies strategy. 9883 being the daily chart 50 day EMA should be reclaimed. On the positive note, 9685 was the key level from where the Nifty bounced to reclaim the top. This was August 2017. In the recent downturn the markets reversed from 9687. However Nifty is not decisively safe as it’s just 1% away from its low. This can be categorized as a dead cat bounce and not a buying spree.

Fundamentally speaking, multiples are still stretched. Nothing has changed substantially. FII selling is relentless. DII buying is relentless. Time will tell who has the last laugh. History tells us its going to be FIIs. Economy is struggling – mixed data points, noise of a political instability, doubts being cast on the ability of the incumbent government are weighing down. With the Q2 FY17 closed, all eyes will be on the results season which will kick-start soon. This seems to be the deal breaker quarter.

Globally, Korea v/s the world noise seems to have lowered as bit. As of now. Dow is stable and so are global markets supported by lack of negative triggers and bundle of liquidity. Commodity space is seeing some traction as Crude is having one of the best runs in recent times.

Sector watch – keep and eye on Metals. As a space they seem to look strong. If the recent lows hold, Nifty Metal should be on its way to make a new high. Watch out for Auto Index and stocks. Given a robust performance they would show good positive traction. Nifty Bank is looking tricky. A breach of previous lows will accelerate momentum on the down side.

Weekly Markets Sentiment_23.09.2017

Markets had a rough week. Sentiment changed for the worse. Nifty, from all time new closing highs fell right below 10k. Friday’s fall was particularly steep and worrisome. Weekly cut on the Nifty was of more than 100 points. Sentiment turned for the worse and participants see deeper cut on the index. Fall across the market was deep. Mid-caps and Small-caps were butchered and badgered out of shape. Cuts across some of the counters were as deep as 7-10%.

Technically Nifty is below support of 10k. 9950 can break easily if the fall is not restricted. 9900 is the 50-D EMA. That should provide intermediate support. Sentiment is bearish no doubt as last highs were not taken out. Early days for a double top, but Nifty sure is not sustaining at high levels. Next week it is crucial that Nifty hovers or settles near the 9950 level. Should this break you are likely to test 9700.

Fundamentally markets are at 26x P/E. The valuations continue to remain elevated and above historical levels. Domestic flows continue to barge in. FIIs continue to sell heavily. They have sold about 15k crores this month and sell every day. The quantum of FII selling is more than matched by domestic MF flows. SIPs continue to flow and support the markets.

Globally, DOW is above 22k. Fed stayed put with rates however have indicated an imminent hike in December. North Korea continues to threaten world safety and give bears new hopes and reasons to fall. US retaliated with some actions of its own. Situation remains skeptical.

For the week Metals look like to continue its correction. Having said that they will be a good buying opportunity. Some of the indexes are showing signs of reversal however confirmations are far off as of now. One has to wait and watch for indices to breach key support zones. Pharma and IT continue to be safe bets. Banks are weakest.

Ongoing_IPO_SBI Life Insurance Company Ltd

SBI Life Insurance Company Ltd IPO Detail

Issue Detail:

Issue Open Date Sept 20th , 2017 Price Band : Rs 685 – Rs 700  
Issue Open Date Sept 22th , 2017 Minimum Bid Qty : 21  


Objects Of The Issue :

The objects of the Offer are to achieve the benefits of listing Equity Shares on the Stock Exchanges and to carry out the sale of up to 120,000,000 Equity Shares by the Selling Shareholders.

 

Business Description :

Incorporated in 2000, SBI Life Insurance Company Limited is India based private life insurer. SBI Life Insurance is a joint venture between the State Bank and BNPPC. State Bank is India’s largest commercial bank. BNPPC, an insurance subsidiary of BNP Paribas, with operations across 36 jurisdictions internationally, is among the leading credit life insurance businesses globally. BNP Paribas is in top 10 global financial institution in terms of revenue.
SBI Life has product a portfolio of 37 individual and group products, including a range of protection and savings products to address the insurance needs of diverse customer segments.

Company has developed a multi-channel distribution network comprising bank branches of SBI and its associated banks, individual agent network (93,849 agents) and other distribution channels including direct sales and sales through corporate agents, brokers, insurance marketing firms and other intermediaries.

SBI Life turned profitable within the first five years of our operations, and have declared dividends every year since 2012.

Competitive Strengths

  1. Largest private life insurer in India since 2010.
    2. Backed by SBI and BNPPC
    3. Vast multi-channel distribution with pan-India presence (Branches, Agents and Online)
    4. Strong capital base. Company has not required additional capital infusion since 2008.
    5. Diversified product portfolio

Company Promoters:

The Promoters of the Company are State Bank and BNPPC.

Company Financials:

Particulars For the year/period ended (in Rs. million)
31-Mar-17 31-Mar-16 31-Mar-15 31-Mar-14 31-Mar-13
Total Assets 26,782.89 23,110.62 25,516.19 24,341.77 19,756.78
Total Revenue 3,02,775.13 1,91,197.24 2,31,864.86 1,73,694.22 1,49,755.25
Profit After Tax 9,546.53 8,441.03 8,148.67 7,277.53 6,301.12


Company Contact Information :-

SBI Life Insurance Company Ltd
NATRAJ,
M. V. Road and Western Express Highway Junction,
Andheri (East), Mumbai 400 069
Phone: +91 22 6191 1000
Fax: +91 22 6191 0338
Email: investor@sbilife.co.in
Website: https://www.sbilife.co.in/

 

IPO Registrar :

Karvy Computershare Private Limited
Karvy House, 46, Avenue 4, Street No. 1,
Banjara Hills, Hyderabad – 500 034
Andhra Pradesh, India

Phone: +91-40-23312454
Fax: +91-40-23311968
Email: einward.ris@karvy.com
Website: http://karisma.karvy.com

IPO Lead Manager(s) :

1. Axis Capital Limited
2. BNP Paribas
3. Citigroup Global Markets India Private Limited
4. Deutsche Equities India Private Limited
5. ICICI Securities Limited
6. JM Financial Consultants Private Limited
7. Kotak Mahindra Capital Company

Weekly Markets Sentiment_16.09.2017

Markets rose for the week ending 16.09.2017. Global rally lifted stocks and Nifty ended firmly above 10k at 10085. It was up 1.5% for the week. Sentiment all across the globe was that of relief. Although, the routine Friday came up with usual news of North Korea activity. This put some brakes on bulls as they were trying to get past the all time highs. Markets sentiment is soured by the recent act of North Korea but such things seems to have a new normal status.

Technically speaking Nifty is past 10k which was its major intermediate hurdle. This in turn will be the level to defend. This week, 10k will provide a certain amount of support on the way down. On its way up Nifty will face supply in the 10100-150 region. It did briefly hit 10131 and receded back below 10100. This is a major supply zone and will be interesting to see it markets blast past this. In all likely hood there can be a very slow and uncertain breakout. Almost a forced move beyond all time highs. The near term support is locked at 9800, while 10k looks good for this week. The more Nifty stays above 10k, call writers will be on their toes.

Fundamentally, nothing has changed, nothing will. Post the 400 point correction, Nifty has smartly and slowly climbed up a wall of worry. Multiples are still way beyond normal. P/E nearing 26-27 range. This is in the historical high range. Still due to lack of negative triggers and ample amount of domestic flows, markets continue to frustrate people who are sitting on cash. FIIs have been net sellers to the tune of 3000-3500 cr. After almost a month of relentless selling Friday they bought 400 cr. A noteworthy number. DII’s continue to force-feed the markets. They pumped in 3500 cr+ in the same week. SIP flows, MFs selling continues to attract retail to equities. People want to make merry while it lasts!

Globally, DOW recorded its highest ever close. It now is firmly above 22k. Apple’s launch was muted. People say Jobs invents, Cook improves! Stock reacted as if nothing new had happened. Markets world over look flushed with liquidity. Korea holds the key. It is almost as if markets expect Korea to do some testing on Friday. A surprise jolt could trigger something catastrophic, albeit the probability is low.

Sector watch – Metals cooled off slightly. Still they look somewhat overheated but the strongest index in all. Nifty metals should try to test 3750. Bottom fishing in pharma continues, the sector looks interesting with a lot of sentiment changing. Nifty Pharma can test 9900 this week.

Upcoming SME IPO : Worth Peripherals Limited

SME IPO: Worth Peripherals Limited

Issue Details

Issue opens 15th September 2017
Issue Closes 19th September 2017
Issue Price 40-43
Lot Size 3000
Issue Size 18.27 Crore
Lead Manager Pantometh Capital Advisors Pvt. Ltd.
Registrar Big Share Services Pvt. Ltd.
Platform NSE

Promoters of the Company

  1. Mr. Raminder Singh Chadda
  2. Ms. Amarveer Kaur Chadda

Object of the Issue: 

(Rs. in Lakhs)
Sr. No. Particulars Amount
1 Working Capital Requirements 610.42
2 Purchase of plant & Machinery 475.00
3 Repayment of Borrowing 300.00
4 General Corporate Purpose 441.58
Total 1827.00

Business Description

The company is engaged in the manufacturing of Corrugated Boxes having registered office situated at Indore, Madhya Pradesh. The company is adhere to Sedex Members Ethical Trade Audit( SMETA) best practice guidance guidelines which include adhering to labour standards, health standards and  safety ethics audit norms for SEDEX.

The company is well equipped with in house testing laboratories to test the products. It has fully automated plant managed through Programmable Logic Controller.

Company Financials

(Rs. in Lakhs)
Particulars 2016-17 2015-16 2014-15 2013-14 2012-13
Total Revenue 13214.73 12740 10778.41 8423.23 5935.17
Total Asset 8124.79 8571.2 6154.24 5449.23 4477.35
PAT 731.65 646.62 601.63 515.04 345.76

Companies Contact Information

Worth Peripherals Limited

102, Sanskriti Apartment, 44 Saket Nagar

Indore 452018

Email: investors@worthindia.com

Financial Ratios

EPS: 5.93

P/E Ratio :  6.75 – 7.25

Weighted RONW : 19.19%

NAV per Equity Share  : 35.36

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Weekly Markets Sentiment_09.09.2017

Markets traded flat for the week. Nifty ended down marginally in the negative zone. It was flirting with the 9950 levels. The week was range bound with the index doing a balancing act. Where financials dragged Reliance supported. Dixon and Bharat closed their IPOs with decent response. Dixon being the more fancy IPO to be watched. A lot of other players have lined up for moping public funds. FII were relentless sellers. They sold more than 2500cr worth of stocks. DII countered but not with the same quantum. Sentiment seems cautious.

Technically looking at the charts 9880 is a key support from where Nifty comes back up. On the up side 9970-80 is the tough ceiling to crack. Nifty has been in this range and is likely to remain till something substantial should happen. The longer term support stands at 9830 where its 50 day EMA has been defended on 3 occasions. Till Nifty trades above 9800 the medium term trend should point upwards. FnO stats show a lot of writing happening at 9800. On the upside call writing has been seen around 10000 levels. A breakout of either side will give fresh momentum.

Fundamentally – picture does not change. Markets are at lofty valuations. Nifty trades at 25x+ P/E. This is outrageous. Given the liquidity it does make sense. It’s a matter or time when the dry powder will be gone. Most of the stocks and sectors are trading at premium valuations to their average historical numbers. Fundamentally picture does not look good. Lack of trigger and liquidity keeps the market afloat.

Globally things are all over the place. North Korea tension continues. US Fed meets start. Debt ceiling and extending the stimulus are doing the rounds. The sentiment is all over the place. Dow is still below 22k. It’s as if almost every one is in wait and watch mode. And this trend and sentiment has boiled down to all major markets. A positive trigger can lead to the fresh break out of the Dow – although it is overbought.

Sector wise – Metals should take a breather. They look stretched and over bought. Be cautious with long positions. Its a good time to take away some trading profits. Pharma looks shaky. One needs to do proper bottom fishing in the sector. Nifty bank should lead the market. 24500 once breached will give it fresh legs to take the market higher.

Ongoing SME IPO_ NOURITRANS EXIM LIMITED

SME IPO : Nouritrans Exim Limited

 

Issue opens 4th September 2017
Issue Closes 7th September 2017
Issue Price 30
Lot Size 4000
Issue Size 6.12 Cr.
Lead Manager First Overseas Capital Limited
Registrar Karvy Computershare Private Limited
Platform BSE

Name of the Promoter : Mrs. Shaheen Vohra

Registered Office : 101/17 Premier Shopping Centre, Mirzapur Road , Ahmedabad 380001 , Gujarat , India

Overview of Company:

Nouritrans Exim Limited is in the business of exports, imports and trading of commodities since 1995. Currently they had a head office and corporate office located in Gujarat. Their global presence cover various markets in USA, UK, Europe,  South Africa and Middle East. The Managing Director of the company has 22 years of experience and have a mission of dramatically changing the way companies conduct Global trade. The company has been accredited as an International Commodity Export – Import & Trading Company and having APEDA Certificate.

Object of the Issue :

(Rs. in Lakh)
Sr. No. Particulars Amount
1 Working Capital 578
2 General Corporate Expenses 9
3 Issue Expenses 25
Total 612

Financials :

(Rs. in Lakh)
Particulars 2016-17 2015-16 2014-15 2013-14 2012-13
Total Revenue 1160 634.89 417.99 118.89 96.65
PAT 30.41 5.93 5.12 0.45 0.52
Debt 2.55 15.86 5.59 20.04 7.19

Significant Ratios:

EPS : 1.05

RONW : 6.87%

NAV per Share : 29.37

PE Ratio : 28.57

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