Nifty support at 4515-4430
Resisitance at 4630-4690
For the day, we expect the market to open on a flat to slightly positive note, as the short squeeze may continue
F&O indicators suggest that there may be more upside in the offing. The Nifty futures expiring in June shed more than 20 lakh shares in open interest while the discount slumped from about 30 points to almost nil. With this, the total open interest in Nifty futures has slipped below 4 crore shares. Over the past few months there have been a few instances where the market trend has taken an about turn following this event. It remains to be seen if the bulls are lucky this time round as well.
The advance tax numbers for a few top companies are out and as usual it’s a mixed bag. Banks like ICICI Bank, SBI and HDFC have done well and so has Reliance Industries. Bajaj Auto, Tata Motors and Ambuja Cements have reported lower tax outgo versus the same period last year.
Cadila Healthcare's Board will meet today to consider options to consolidate / restructure the Consumer Products business of the group, including its listed subsidiary, namely Carnation Nutra-Analogue Foods Ltd.
Champagne Indage's Board will consider raising of long term / medium term financial resources.
Both L&T and Crompton Greaves have denied reports that L&T is doing due diligence to acquire Crompton Greaves' project business.
FIIs were net sellers of Rs5.48bn (provisional) in the cash segment on Monday while the local institutions poured in Rs2.9bn. In the F&O segment, foreign funds were net buyers of Rs593.2mn
Results Today: BPCL, Bilpower, Cambridge Solutions, Chettinad Cement, IRB Infra, Jumbo Bag, Sical Logistics, Sri Digvijay Cement, Tantia Constructions, Tata Communications, Wire & Wireless and Zee News.
Today's Pick - GSFC
We recommend a buy in Gujarat State Fertilizers & Chemicals from a short-term perspective. It is clearly visible from the charts of Gujarat State Fertilizers & Chemicals that it had been on an intermediate-term downtrend from its January 2008 high of Rs 370 until it reached its June low of Rs 152.
However, after finding support at around Rs 150 (a significant long-term support level) in the recent times, the stock began to move up. During this upmove, the stock conclusively penetrated the intermediate-term down trendline and its 21-day moving average.
There is also an increase in trading volumes over the past two trading sessions.
We believe that the stock will continue to move higher in the short-term. The daily Relative Strength index is rising towards the bullish zone. We notice a crossover in the daily moving average convergence and divergence and it is rising in line with the stock price, indicating bullishness. Our short-term forecast for the stock is bullish. We expect the stock to move upwards until it hits our price target of Rs 200 in the forthcoming trading sessions. Traders with short-term perspective can buy the stock while maintaining stop-loss at Rs 167.
Corporate News
Japanese drug-maker Daiichi-Sankyo may revise the open offer price for Ranbaxy in the case of a competitive bid. (BS)
Reliance Industries is seeking to borrow US$1bn to fund its expansion projects. (DNA)
Reliance Power will get a US$500-million loan from ADB for the 4,000-MW UMPP coming up at Krishnapatnam in AP. (BS)
IOC, HPCL and BPCL sell bonds to RBI at a premium. (BS)
Maruti may launch a stripped-down version of Maruti 800 to compete with Nano. (BS)
Balmer Lawrie is set to acquire a 50% stake in a travel and tourism company with a national presence. (ET)
TCS plans to participate in e-governance projects in India as well as countries in the Middle East, Latin America, eastern Europe and Africa. (ET)
Unitech has scrapped plans for a US$600mn sale of shares in a real estate investment trust in Singapore. (BS)
ITC Welcom Group through its subsidiary Fortune Park Hotels Ltd is planning to add another 21 hotels in the next three years. (BS)
The Al Rostmani group, one of the largest conglomerates in the UAE, is planning to pick up a majority stake in GHCL for an estimated investment of Rs7bn. (BS)
Srei Equipment Finance Pvt. Ltd., a 50:50 JV between Srei Infrastructure Finance Ltd and BNP Paribas, will raise ~Rs80-90bn during FY09. (DNA)
Aksh Optifibre, in collaboration with MTNL has cut its subscription rates to Rs199 per month. (ET)
Daiichi-Sankyo has been granted two product patents by the Kolkata Patent Office. (BS)
Jet Airways plans to put its international expansion on hold until the end of next year due to soaring oil prices. (ET)
Jet Airways has announced a two-year tie-up with Shell-MRPL Aviation Fuels and Services Pvt. Ltd for its fuel supply at the new airports in Banaglore and Hyderabad. (Mint)
Sterlite Industries may consider legal action if the bankruptcy court favors Grupo Mexico's counter-offer of US$4.1bn for Asarco, the US copper mining giant. (BS)
Godavari Fertilisers and Chemicals Limited would solely cater to the agri input requirements of the state farmers, starting this kharif season. (BS)
Gujarat State Petroleum Corporation (GSPC) has applied to the Directorate General of Hydrocarbons (DGH) for declaration of commerciality of its discoveries in the KG basin block. (BL)
SRF plans to put its share buyback plan on hold. (Mint)
NMDC has resumed operations at three iron ore mines in Chattisgarh. (Mint)
Transport Corporation of India plans to raise capital for its expansion plan by diluting promoter holding by ~10%, which is expected to generate ~Rs680mn. (ET)
Goldman Sachs has acquired a minority stake in Shapoorji Pallonji’s engineering arm Sterling & Wilson for over Rs2bn. (ET)
Gemini Communications has acquired a majority stake in Chennai based Veeras Infotek for Rs70mn. (ET)
Nokia’s market share in India has increased to 62.5% in 2007-08 from 53.6% last year. (ET)
Cobra Beer India, the Indian subsidiary of the US$400mn UK-based Cobra Beer will be launching diet beer in India. (ET)
Malaysian national carmaker Proton plans to enter the Indian passenger vehicle market (ET)
Economic News
State governments to roll back jet fuel tax cuts, as they believe that benefits have not been passed on to the consumers. (BS)
The Government has allowed private mobile operators to enter into mutual agreements for intra circle roaming with each other. (BS)
Mumbai Metro rail project will generate 651,938 carbon credits between 2011 and 2020. (BL)
States have asked the Centre to pay them Rs40bn for the revenue loss due to duty cuts on petrol, diesel and cooking gas during the remaining part of 2008-09. (FE)
Soaring steel and cement prices have virtually put the brakes on the Pradhan Mantri Gram Sadak Yojana, the rural road component of the UPA’s flagship ‘Bharat Nirman’ programme. (FE)
The department of fertiliser (DoF) has firmed up a time-bound completion of revival of seven sick units of Fertiliser Corporation of India (FCI) and Hindustan Fertiliser Corporation (HFC). (FE)
According to ministry officials, the national-wide rollout of CAS will happen only after the general elections in 2009. (ET)
According to TRAI, Mobile Virtual Network Operators (MVNOs) that intend to enter the domestic mobile space will not be allowed to own spectrum. (BS)
The empowered group of state finance ministers deferred its decision on rationalization of sales tax on aviation turbine fuel to June 23, 2008. (DNA)
According to CMIE, GDP is expected to grow at an impressive 9.5% in 2008-09. (ET)
Small and medium enterprises will get Rs550mn IPR facilitation package for implementation over the next four years. (ET)
Gems and jewellery exports rose by over 36% yoy to US$1.8bn in May 2008