Market Outlook
April 30, 2018
Market Cues
Domestic Indices
Chg (%)
(Pts)
(Cl ose)
Indian markets are likely to open positive tracking global indices and SGX Nifty.
BSE Sensex
0.7
256
34,970
U.S. Stocks showed a lack of direction over the course of the trading day following
Nifty
0.7
74
10,692
the rally seen in the previous session. The major averages spent the day bouncing
Mid Cap
0.8
132
16,917
back and forth across the unchanged line before closing roughly flat. The Dow
Small Cap
0.4
76
18,240
edged down to 0.1 percent to 24,311 while the Nasdaq edged up by 0.01 percent
Bankex
2.0
560
28,530
to 7,119.
U.K. shares extended gains from the previous session as weak GDP data weighed
Global Indices
Chg (%)
(Pts)
(Cl ose)
on the pound and helped reduce the chances of a rate hike at the Bank of England's
monetary policy meeting on May 10. The FTSE 100 was up by 0.5 percent to close
Dow Jones
(0.1)
(11)
24,311
at 7,458.
Nasdaq
0.01
-
7,119
FTSE
0.5
17
7,458
On domestic front, Indian shares rose notably during the last trading session on the
Nikkei
0.7
148
22,468
back of positive global cues and optimism over the ongoing earnings season. The
BSE Sensex ended up by 0.7 percent to 34,970.
Hang Seng
0.9
273
30,281
Shanghai Com
0.2
7
3,082
News Analysis
Maruti Suzuki eyes 10% increase in outlets in FY19
A dvances / Declines
BSE
NSE
Detailed analysis on Pg2
Advances
1,404
796
Declines
1,248
982
Investor’s Ready Reckoner
Unchanged
137
76
Key Domestic & Global Indicators
Stock Watch: Latest investment recommendations on 150+ stocks
Volumes (` Cr)
Refer Pg5 onwards
BSE
3,566
Top Picks
NSE
34,482
C MP
Target
U psi de
C ompany
Sector
R ating
(`)
(`)
(%)
Blue Star
Capital Goods Accumulate
806
867
7.6
Net Inflows (` Cr)
Ne t
Mtd
Ytd
Dewan Housi ng Finance
Financials
Buy
635
720
13.5
FII
(100)
(4,952)
8,655
Century Plyboards
Forest Product
Buy
325
400
23.0
*MFs
409
8,173
42,632
Navkar Corporation
Others
Buy
180
265
47.6
KEI Industrie s
Capital Goods Accumulate
429
485
13.0
More Top Picks on Pg4
Top Gainers
Price (`)
Chg (%)
AXISBANK
539
9.0
Key Upcoming Events
Previous
C onsensus
ANDHRABANK
40
7.3
D ate
Region
Event Description
ReadingExpectations
ORIENTBANK
94
6.3
Apr 30, 2018 UK
GDP (YoY)
1.20
1.40
May 01, 2018 China
PMI Manufacturing
51.50
51.30
ATUL
2,925
6.1
May 02, 2018 Germany PMI Manufacturing
58.10
58.10
UBL
1,195
5.7
May 02, 2018 US
FOMC rate decision
1.75
1.75
May 02, 2018 Euro Zone Euro-Zone GDP s.a. (QoQ)
0.70
0.40
Top Losers
Price (`)
Chg (%)
More Events on Pg7
PCJEWELLER
178
-24.9
RNAVAL
18
-7.2
VIDEOIND
11
-7.0
RALLIS
220
-6.4
INDIGO
1407
-6.2
As on April 27, 2018
Market Outlook
April 30, 2018
News Analysis
Maruti Suzuki eyes 10% increase in outlets in FY19
The country's largest carmaker Maruti Suzuki India (MSI) aims to expand its sales
network, including dealerships of its LCV Super Carry, by at least 10 per cent this
financial year. The company, which currently has a network of around 2,625
dealerships across the country, is also aiming for a double-digit growth in the
current financial year.
Arena, besides enhancing the network for its light commercial vehicle Super Carry.
"Macroeconomic factors seem to be positive, GDP growth forecast is on the higher
side and there are expectations of a good monsoon, so all these factors will be
contributing positively towards the market sentiment and the management are
confident that they will be able to do double-digit growth this fiscal as well.
Economic and Political News
Modi government collects Rs 7.41 trillion from GST in 2017-18
Centre approves Rs 6bn for nine projects in Haryana for Amrut Scheme
India, Pakistan, China to join multi-nation military exercise in Russia
Yogi government to showcase Jewar airport, Defence Corridor projects in US
meet
Corporate News
Indian Oil board approves Rs 42bn ethylene glycol project in Paradip
GAIL to roll out training programmes for unskilled workers in Odisha
IndiGo's billionaire boss Rahul Bhatia steps in after Aditya Ghosh's exit
Market Outlook
April 30, 2018
Quarterly Bloomberg Brokers Consensus Estimate
HDFC Ltd - April 30, 2018
Particulars ( ` cr)
4QFY18E
4QFY17
y-o-y (%)
3QFY18
q-o-q (%)
PAT
3,631
3,079
18
6,677
(46)
Kotak Mahindra Bank Ltd - April 30, 2018
Particulars ( ` cr)
4QFY18E
4QFY17
y-o-y (%)
3QFY18
q-o-q (%)
PAT
1,702
1,404
21
1,624
5
Container Corporation of India Ltd - April 30, 2018
Particulars ( ` cr)
4QFY18E
4QFY17
y-o-y (%)
3QFY18
q-o-q (%)
Sales
1,611
1,558
3
1,640
(2)
EBIDTA
386
495
(22)
446
(13)
%
24
32
27
PAT
267
336
21
289
(8)
Market Outlook
April 30, 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
23,578
1,972
2,441
23.8
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
7,738
806
867
7.6
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
19,902
635
720
13.5
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
1,85,169
288
416
44.4
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
3,364
429
485
13.0
B2C sales and hi gher exports to boost the revenue s
and profitability
Expected to benefit from the lower capex
Music Broadcast Limited
2,213
388
475
22.5
requirement and 15 year long radio broadcast
licensing.
Massive capacity expansion along with rail
Navkar Corporation
2,703
180
265
47.6
advantage at ICD as well CFS augur well for the
company
Strong brands and distribution network would boost
Siyaram Silk Mills
3,140
670
851
27.0
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
2,837
476
603
26.8
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
2,65,164
8,778
10,619
21.0
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
2,304
428
655
53.1
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
7,225
325
400
23.0
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
2,939
92
128
39.3
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
1,484
667
750
12.5
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
2,788
386
510
32.3
operating margi n due price hi ke in container glass
segment, turnaround in consumer busine ss.
Source: Company, Angel Research
Market Outlook
April 30, 2018
Top Picks
Market Cap
C MP
Target
Upside
C ompany
R ationale
(` Cr)
(`)
(`)
(%)
We expect financi alisation of savings and
Aditya Birla Capital
34,457
157
230
31.33
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
2,640
314
333
7.1
Value Added Products and reduction in interest cost
is likely to boost margins and e arnings in next few
years.
We expect MCL to report net revenue CAGR of
~15% to ~`450cr over FY2018-20E mainly due to
strong growth in online matchmaking & marriage
Matrimony.com Ltd
1,901
837
984
17.6
related services. On the bottom-line front, we
expect a CAGR of ~28% to `82cr over the same
period on the back margin improve ment.
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
4,046
304
360
18.4
over FY18-20 backed by capacity expansion and
new geographical foray
We forecast Nilkamal to report top-line CAGR of
~9% to `2,635cr over FY17-20E on the back of
Nilkamal
2,512
1,683
2,178
29.4
healthy demand growth in plastic divi sion. On the
bottom-line front, we esti mate
~10% CAGR to
`162cr owing to improve ment in volumes.
The prism has diversified exposure in the different
segment such as Ceme nt, Tile & ready mix concrete.
Prism Cement
6,005
119
160
34.1
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 used in electrical
equipme nts like motors, transformers etc. It derives
Elantas Beck India Ltd
1,872
2,361
2,500
5.9
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 me dium density fibreboards
(MDF). GIL to report net revenue CAGR of ~14% to
Greenply Industries
3,801
310
395
27.4
~`2,478cr over FY2017-20E mainly due to healthy
growth in plyw ood & lamination busine ss on the
back of strong brand and di stribution network
GMM Pfaudler Limited (GMM) is the Indian market
leader in glass-lined (GL) steel equipment. GMM is
expected to cross CAGR 15%+ in revenue over the
GMM Pfaudler Ltd
4,046
304
360
18.4
next few years mainly led by uptick in demand from
user industries and it is also expecting to increase its
share of non-GL business to 50% by 2020.
Market Outlook
April 30, 2018
Key Upcoming Events
Result Calendar
D ate
C ompany
April 30, 2018
CEAT, HDFC, Kotak Mah.Bannk, IDFC, Hind.Zinc, Prakash Industries
May 01, 2018
Dabur India, Hindustan Medi a Ve ntures
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 30, 2018
2:00 PMUK
GDP (YoY)
% Change
1Q A
1.20
1.40
May 01, 2018
6:30 AMChina
PMI Manufacturing
Value
Apr
51.50
51.30
May 02, 2018
1:25 PMGermany PMI Manufacturing
Value
Apr F
58.10
58.10
11: 30 PMUS
FOMC rate decision
%
May 2
1.75
1.75
2:30 PMEuro Zone Euro-Zone GDP s.a. (QoQ)
% Change
1Q A
0.70
0.40
May 04, 2018
1:25 PMGermany PMI Services
Value
Apr F
54.10
54.10
6:00 PMUS
Change in N onfarm payrolls
Thousands
Apr
103.00
185.00
6:00 PMUS
Unnemployment rate
%
Apr
4.10
4.00
May 08, 2018
China
Exports YoY%
% Change
Apr
(2.70)
May 09, 2018
US
Producer Price Index (mom)
% Change
Apr
0.20
May 10, 2018
6:00 PMUS
Consumer price index (mom)
% Change
Apr
(0.10)
7:00 AMChina
Consumer Price Index (YoY)
% Change
Apr
2.10
2:00 PMUK
Industrial Production (YoY)
% Change
Mar
2.20
4:30 PMUK
BOE Announce s rate s
% Ratio
May 10
0.50
May 11, 2018
5:30 PMIndia
Industrial Production YoY
% Change
Mar
7.10
Source: Bloomberg, Angel Research
Market Outlook
April 30, 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 30, 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 as on 27 April, 2018
Market Outlook
April 30, 2018
Exhibit 4: Relative performance of indices across globe
Returns (%)
C ountry
Name of index
Closing price
1M
3M
1YR
Brazil
Bovespa
85,824
2.3
7.6
33.4
Russia
Micex
4,480
1.4
7.1
11.4
India
Nifty
10,565
4.7
(1.7)
16.0
China
Shanghai Composite
3,117
(6.3)
(10.3)
(6.2)
South Africa
Top 40
50,729
(1.3)
(6.2)
10.8
Mexico
Mexbol
48,745
1.9
(1.3)
(0.3)
Indonesia
LQ45
1,040
0.7
(5.9)
10.0
Malaysia
KLCI
1,895
2.1
3.8
9.2
Thailand
SET 50
1,189
0.2
0.7
19.2
USA
Dow Jones
24,665
0.2
(5.6)
19.9
UK
FTSE
7,329
2.3
(5.1)
3.0
Japan
Nikkei
22,191
3.3
(7.0)
19.6
Germany
DAX
12,567
2.9
(5.3)
4.4
France
CAC
5,392
3.7
(1.4)
2.4
Source: Bloomberg, Angel Research as on 27 April, 2018 68in4
Market Outlook
April 30, 2018
Research Team Tel: 022 - 39357800
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