Market Outlook
April 18, 2018
Market Cues
Domestic Indices
Chg (%)
(Pts)
(Cl ose)
Indian markets are likely to open positive tracking global indices and SGX Nifty.
BSE Sensex
0.3
90
34,395
U.S. stocks moved significantly higher over the course of the trading day, adding to
Nifty
0.2
20
10,549
the gains posted in the previous session. With the continued upward move on the
Mid Cap
0.3
46
16,780
day, the Dow reached its best closing level in a month. The Dow Jones ended up by
Small Cap
0.3
50
18,132
0.9% to close at 24,786. The NASDAQ ended up by 1.7% to close at 7,281.
Bankex
0.0
13
28,400
U.K. shares erased early losses to edge higher after a government report showed
U.K. wages grew faster than inflation for the first time in almost a year in February,
Global Indices
Chg (%)
(Pts)
(Cl ose)
helping cement expectations for a rate hike at the next MPC meeting in May. The
FTSE 100 was closed up by 0.2% to end at 7,212.
Dow Jones
0.9
213
24,786
Nasdaq
1.7
125
7,281
On domestic front, Indian shares extended their winning streak to a ninth straight
FTSE
0.2
17
7,212
session after the India Meteorological Department (IMD) forecast that the country will
Nikkei
0.1
12
21,848
receive normal monsoon for a third consecutive year. The BSE Sensex ended up by
0.3% at 34,395.
Hang Seng
(0.8)
(253)
30,063
Shanghai Com
(1.4)
(44)
3,067
News Analysis
Lupin gets tentative USFDA nod to market testosterone gel
A dvances / Declines
BSE
NSE
Detailed analysis on Pg2
Advances
1,389
865
Declines
1,285
954
Investor’s Ready Reckoner
Unchanged
153
79
Key Domestic & Global Indicators
Stock Watch: Latest investment recommendations on 150+ stocks
Volumes (` Cr)
Refer Pg5 onwards
BSE
3,531
Top Picks
NSE
28,197
C MP
Target
U psi de
C ompany
Sector
R ating
(`)
(`)
(%)
Blue Star
Capital Goods Accumulate
781
867
11.0
Net Inflows (` Cr)
Ne t
Mtd
Ytd
Dewan Housi ng Finance
Financials
Buy
590
720
22.1
FII
(84)
(910)
12,697
Century Plyboards
Forest Product
Buy
341
400
17.3
*MFs
599
4,284
38,744
Navkar Corporation
Others
Buy
175
265
51.8
KEI Industrie s
Capital Goods Accumulate
434
485
11.8
More Top Picks on Pg4
Top Gainers
Price (`)
Chg (%)
IBVENTUREPP
193
12.4
Key Upcoming Events
Previous
C onsensus
DCBBAN K
203
6.4
D ate
Region
Event Description
ReadingExpectations
SOUTHBANK
27
6.0
Apr 18, 2018 China
Real GDP (YoY)
6.80
6.80
Apr 18, 2018 UK
CPI (YoY)
2.70
2.70
BAJAJELEC
654
5.6
Apr 19, 2018 US
Initial Jobless claims
233.00
230.00
INDHOTEL
147
5.3
Apr 20, 2018 Euro Zone Euro-Zone Consumer Confidence
0.10
(0.10)
Apr 23, 2018 Germany PMI Services
53.90
Top Losers
Price (`)
Chg (%)
More Events on Pg7
VAKRANGEE
120
-5.0
WELSPUNIND
53
-5.0
KWALITY
59
-4.4
RAIN
344
-3.2
FORTIS
145
-3.0
As on April 16, 2018
Market Outlook
April 18, 2018
News Analysis
Lupin gets tentative USFDA nod to market testosterone gel
Drug firm Lupin has received tentative nod from the US health regulator to market
its Testosterone gel 1.62 per cent. The company has received tentative approval
from the United States Food and Drug Administration (USFDA) to market its
generic Testosterone Gel, 1.62 per cent. The product is a generic version of
AbbVie Inc's AndroGel in the same strength. As per IQVIA MAT January 2018
data, Testosterone Gel 1.62 per cent had annual sales of around USD 956.9
The product is indicated for replacement therapy in males for
million in the US.
conditions associated with a deficiency or absence of endogenous testosterone, it
added.
Economic and Political News
India to witness cash flow worth $1.1bn from Swedish companies
Govt working with US to address trade issues, like duty-free access
Amid cash crunch, govt to raise printing of Rs 500 notes by five times
Corporate News
Toyota Kirloskar may hike vehicle prices next month to offset input costs
Vedanta's resolution plan for insolvent Electrosteel gets NCLT approval
Trai unveils beta site for comparing telecom tariffs under one platform
Market Outlook
April 18, 2018
Quarterly Bloomberg Brokers Consensus Estimate
ACC Ltd - April 18, 2018
Particulars ( ` cr)
4QFY18E
4QFY17
y-o-y (%)
3QFY18
q-o-q (%)
Sales
3,990
3,174
25.8
3,494
14.2
EBIDTA
503
416
20.9
442
13.8
%
12.6
13.2
12.7
PAT
364
211
72.5
205
77.5
Indusind Bank - April 19, 2018
Particulars ( ` cr)
4QFY18E
4QFY17
y-o-y (%)
3QFY18
q-o-q (%)
PAT
963
751
28.2
936
2.9
TCS Ltd - April 19, 2018
Particulars ( ` cr)
4QFY18E
4QFY17
y-o-y (%)
3QFY18
q-o-q (%)
Sales
31,663
29,642
6.8
30,904
2.5
EBIDTA
8,645
8,132
6.3
8,287
4.3
%
27.3
27.5
26.9
PAT
6,813
6,622
2.8
6,545
4.1
Market Outlook
April 18, 2018
Top Picks
Market Cap
C MP
Target
Upside
C ompany
R ationale
(` Cr)
(`)
(`)
(%)
Strong growth in domestic business due to its
leadership in acute therapeutic segment. Alkem
Alkem Laboratories
20,869
1,745
2,441
39.8
expects to launch more products in USA, which
bode s for its internati onal business.
Favorable outlook for the AC industry to augur well
for Cooling products business which is out pacing
Blue Star
7,501
781
867
11.0
the market growth. EMPPAC division's profitability
to improve once oper ating environme nt turns
around.
With a focus on the low and me dium income (LMI)
consumer se gment, the company has increase d its
Dewan Housi ng Finance
18,496
590
720
22.1
presence in tier-II & III cities where the growth
opportunity i s immense.
Well capitalized with CAR of 18.1% which give s
sufficient room to grow asset base. F aster re solution
ICICI Bank
1,87,507
292
416
42.6
of NPA would reduce provi sion cost, which would
help to re port better ROE.
High order book execution in EPC segment, rising
KEI Industrie s
3,400
434
485
11.8
B2C sales and hi gher exports to boost the revenue s
and profitability
Expected to benefit from the lower capex
Music Broadcast Limited
2,202
386
475
23.1
requirement and 15 year long radio broadcast
licensing.
Massive capacity expansion along with rail
Navkar Corporation
2,627
175
265
51.8
advantage at ICD as well CFS augur well for the
company
Strong brands and distribution network would boost
Siyaram Silk Mills
3,263
696
851
22.2
growth goi ng ahe ad. Stock currently trades at an
inexpensive valuation.
Market leadership in Hindi news genre and no. 2
viewership ranking in English news genre, exit from
TV Today Network
2,719
456
603
32.3
the radio busine ss, and anticipated growth in ad
spends by corporate to benefit the stock.
After GST, the company is expected to see higher
volume s along with improving product mix. The
Maruti
2,76,653
9,158
10,619
16.0
Gujarat plant will also enable higher operating
leverage which will be margin accretive.
We expect loan book to grow at 24.3% over next
GIC Housing
2,189
407
655
61.1
two year; change in borrowing mix will help in NIM
improve ment
We expect CPIL to report net Revenue/PAT CAGR of
~17%/ 16% over FY2017-20E mainly due to
Century Plyboards
7,575
341
400
17.3
healthy growth in plywood & lamination busine ss,
forayed into MDF & Particle boards on back of
strong brand & distribution network.
We expect sales/PAT to grow at 13.5%/ 20% over
LT Foods
3,003
94
128
36.3
next two years on the back of strong di stribution
network & addition of new products in portfolio.
Third large st brand play in luggage segment
Increase d product offerings and improvi ng
Safari Industries
1,465
659
720
9.3
distribution network is leading to strong growth in
busine ss. Likely to post robust growth for next 3-4
years
We expect HSIL to report PAT CAGR of ~15% over
FY2017-20E owing to better improve ment in
HSIL Ltd
2,895
401
510
27.3
operating margi n due price hi ke in container glass
segment, turnaround in consumer busine ss.
Source: Company, Angel Research
Market Outlook
April 18, 2018
Top Picks
Market Cap
C MP
Target
Upside
C ompany
R ationale
(` Cr)
(`)
(`)
(%)
We expect financi alisation of savings and
Aditya Birla Capital
34974
159
230
44.7
increasing penetration in Insurance & Mutual fund
would ensure steady growth.
One of the leading Indi an dairy products
companie s in India create d strong brands in dairy
products. Rising revenue share of hi gh-margin
Parag Milk F oods
2092
250
333
34.0
Value Added Products and reduction in interest cost
is likely to boost margins and e arnings in next few
years.
Source: Company, Angel Research
Fundamental Call
Market Cap
C MP
Target
Upside
C ompany
R ationale
(` Cr)
(`)
(`)
(%)
CCL is likely to maintain the strong growth trajectory
CCL Products
3,870
291
360
23.7
over FY18-20 backed by capacity expansi on and new
geographical foray
We forecast Nilkamal to report top-line CAGR of ~9%
to `2,635cr over FY17-20E on the back of healthy
Nilkamal
2,601
1,743
2,178
24.9
demand growth in pl astic division. On the bottom -line
front, we estimate ~10% CAGR to `162cr owing to
improve ment in volumes.
The prism has diversified exposure in the different
segment such as Cement, Tile & ready mix concrete.
Prism Cement
5,972
119
160
34.9
Thus we believe, PCL is in the right place to capture
ongoing government spendi ng on affordable housing
and infrastructure projects.
Elantas Beck India is the Indian market leader in liquid
insulation segment use d in electrical equipments like
Elantas Beck India Ltd
1,738
2,192
2,500
14.0
motors, transformers etc. It derives demand from
several industries which are expected to register 10%+
CAGR in demand in the coming years.
Greenply Industries Ltd (GIL) manufactures plywood &
allied products and medium density fibreboards
(MDF). GIL to report net reve nue CAGR of ~14% to
Greenply Industries
3,845
314
395
26.0
~`2,478cr over F Y2017-20E mainly due to healthy
growth in plywood & lamination busine ss on the back
of strong brand and di stribution network
Ashok Leyland Ltd (ALL) is the flagship company of the
Hinduja Group, and one of the largest commercial
vehicle manufacturers in India. Ashok Leyland
Ashok Leyland
43,684
149
163
9.4
expected to report net Profit (reported) CAGR of ~19%
to
~`2,075cr over FY2017-20E mainly due to
improve ment in replace ment demand.
Market Outlook
April 18, 2018
Key Upcoming Events
Result Calendar
D ate
C ompany
April 18, 2018
ACC Cement, Mindtree
April 19, 2018
TCS, Indusind Bank, Infotech Enterprise s, Reliance Power
Source: Bloomberg, Angel Research
Global economic events release calendar
Bl oomberg Data
D ate
Time
C ountry
Event Description
Unit
Period
L ast Reporte d
E stimate d
Apr 18, 2018
7:30 AMChina
Real GDP (YoY)
% Change
1Q
6.80
6.80
2:00 PMUK
CPI (YoY)
% Change
Mar
2.70
2.70
Apr 19, 2018
6:00 PMUS
Initial Jobless claims
Thousands
Apr 14
233.00
230.00
Apr 20, 2018
7:30 PMEuro Zone Euro-Zone Consumer Confidence
Value
Apr A
0.10
(0.10)
Apr 23, 2018
1:00 PMGermany PMI Services
Value
Apr P
53.90
1:00 PMGermany PMI Manufacturing
Value
Apr P
58.20
7:30 PMUS
Existing home sales
Million
Mar
5.54
5.57
Apr 24, 2018
7:30 PMUS
Consumer Confidence
S.A./ 1985=100
Apr
127.70
126.00
7:30 PMUS
New home sales
Thousands
Mar
618.00
628.00
Apr 26, 2018
5:15 PMEuro Zone ECB announces interest rates
%
Apr 26
-
Apr 27, 2018
6:00 PMUS
GDP Qoq (Annualise d)
% Change
1Q A
2.90
2.20
2:00 PMUK
GDP (YoY)
% Change
1Q A
1.40
1:25 PMGermany Unempl oyment change (000's)
Thousands
Apr
(19.00)
Apr 30, 2018
6:30 AMChina
PMI Manufacturing
Value
Apr
51.50
May 01, 2018
2:00 PMUK
PMI Manufacturing
Value
Apr
55.10
Source: Bloomberg, Angel Research
Market Outlook
April 18, 2018
Macro watch
Exhibit 1: Quarterly GDP trends
Exhibit 2: IIP trends
(%)
(%)
8.5
10.0
9.0
9.1
7.4
9.0
8.0
7.1
7.1
8.0
8.1
7.0
7.6
7.6
8.0
7.3
7.2
7.2
6.0
6.8
4.8
7.0
6.5
5.0
4.1
6.1
5.7
4.0
3.2
6.0
2.9
3.0
1.8
5.0
2.0
1.0
4.0
1.0
-
3.0
(1.0)
(0.3)
Source: CSO, Angel Research
Source: MOSPI, Angel Research
Exhibit 3: Monthly CPI inflation trends
Exhibit 4: Manufacturing and services PMI
56.0
Mfg. PMI
Services PMI
(%)
6.0
54.0
5.2
5.1
4.9
52.0
5.0
4.4
4.3
50.0
4.0
3.6
3.3
3.3
3.0
48.0
3.0
2.4
2.2
46.0
2.0
1.5
44.0
1.0
42.0
40.0
-
Source: Market, Angel Research; Note: Level above 50 indicates expansion
Source: MOSPI, Angel Research
Exhibit 5: Exports and imports growth trends
Exhibit 6: Key policy rates
(%)
Exports yoy growth
Imports yoy growth
(%)
Repo rate
Reverse Repo rate
CRR
60.0
6.50
50.0
6.00
40.0
5.50
30.0
5.00
20.0
4.50
10.0
4.00
0.0
3.50
(10.0)
3.00
Source: Bloomberg, Angel Research
Source: RBI, Angel Research
Market Outlook
April 18, 2018
Global watch
Exhibit 1: Latest quarterly GDP Growth (%, yoy) across select developing and developed countries
(%)
8.0
6.9
7.0
5.8
6.0
5.3
5.0
5.0
1.1
3.7
4.0
2.5
3.0
2.2
1.8
2.0
1.5
1.4
0.8
1.0
0.3
-
Source: Bloomberg, Angel Research
Exhibit 2: 2017 GDP Growth projection by IMF (%, yoy) across select developing and developed countries
(%)
6.7
6.8
7.0
6.0
5.4
5.2
5.0
3.7
4.0
3.0
1.8
2.2
2.0
1.7
1.6
2.0
0.7
1.5
0.7
1.0
-
Source: IMF, Angel Research
Exhibit 3: One year forward P-E ratio across select developing and developed countries
(x)
20.0
18.0
16.0
14.0
12.0
10.0
8.0
6.0
4.0
2.0
-
Source: IMF, Angel Research refer as on 17 April, 2018
Market Outlook
April 18, 2018
Exhibit 4: Relative performance of indices across globe
Returns (%)
C ountry
Name of index
Closing price
1M
3M
1YR
Brazil
Bovespa
82,862
(3.7)
6.0
29.0
Russia
Micex
4,288
1.4
7.1
11.4
India
Nifty
10,528
1.3
(0.8)
14.6
China
Shanghai Composite
3,111
(6.8)
(10.1)
(6.7)
South Africa
Top 40
50,121
(4.7)
(6.3)
6.8
Mexico
Mexbol
48,434
(0.5)
(0.7)
(1.1)
Indonesia
LQ45
1,027
(1.2)
(5.3)
10.5
Malaysia
KLCI
1,879
1.8
3.4
8.0
Thailand
SET 50
1,166
(3.2)
(1.1)
15.6
USA
Dow Jones
24,573
(0.7)
(3.9)
19.1
UK
FTSE
7,198
0.8
(7.5)
0.7
Japan
Nikkei
21,836
0.3
(7.7)
17.0
Germany
DAX
12,391
2.1
(5.4)
4.1
France
CAC
5,313
2.0
(3.1)
5.5
Source: Bloomberg, Angel Research refer as on 17 April, 201868in4
