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ISSUE: 008

27TH OCTOBER, 2018

RULE THE MARKET

From The Desk Of Research HeadCONTENTSEquity 1-6

Derivatives 7-8

Commodity 9-12

Currency 13-14

Events 15

TeamDr Ravi SinghArun Kumar MantriAditya KistampallyChirag M SolankiNarasinga RaoNikunj Todi Osho KrishanDeepak SakureVivek K Vive Ranjan MisraVishal ShahMunindra UpadhyayaYash BhutikaJayasree RamVeeresh HiremathArpit ChandnaRavi PandeyAnup B.P Vinod.JAmit KumarRamesh ChenchalaRahul ChanderSiddhesh GhareBharath SunnamDeepak AgarwalD Jayant Kumar

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Market Correction Brings New Investment Opportunities

The turmoil in equity markets, since the end of August, has been accompanied by some deterioration in the macro-outlook for India. Despite the deterioration, the economic outlook remains strong; in the last quarter, it grew at 10% YoY. Though upcoming elections and a rate rise may slow down the pace somewhat, the economic data signal a turnaround in the capex cycle. This is positive, both for economic growth as well as for corporate earnings. In its latest global economic outlook, IMF maintained its growth forecast for India at 7.3% for FY19 and revised FY20 outlook down by 10 bps to 7.4%. This should lead to a recovery in earnings growth. Since FY13-14 to FY17-18, EPS growth has averaged 4% CAGR, for the current fiscal year, the consensus forecast is for 19.7% growth in EPS. We believe that this is realistic. We believe the major reason for the turnaround will be the pickup in capex. Capacity utilization of Q1FY18-19 came in at 73.8% compared to that of 71.2% in Q1FY17-18. The average new order book has increased by 38% to Rs. 1.808 Bn during Q1FY19. This not only indicates higher economic activity but also tightening of capacity which should lead to manufacturers adding capacity. Growth in capital formation is an important growth driver of corporate earnings.

Automobiles: A quarter of Volatility

In Q2FY19, Indian automobile industry reported mixed volume growth on account of high base impact and current slackness in demand. Following are the key highlights for YTD FY19 on YoY basis.

• Auto market grew by 10.9% to 14.1 Mn

• 2 Wheeler market grew by 10.1% to 11.6 Mn

• Passenger Vehicle market grew by 6.7% to 1.7 Mn

• Commercial Vehicle market grew by 37.8% to 0.5 Mn

Majority of the companies under our coverage are expected to report subdued sales and PAT growth during the quarter on account of low growth environment and higher fuel cost, denting volume growth which impacted their operational and financial performance.

Growth Outlook

Going forward, we anticipate higher single-digit volume growth in 4W and 2W segments in India on account of gradual economic recovery, healthy agriculture output and higher rural spending by Government aiding the rural economy. At the same time, Government’s increasing thrust on infrastructure development and stricter implementation on the ban on overloading of trucks is likely to push up higher demand for commercial vehicles in the Country. We expect 2W, 4W and CV market to grow at 9-10%, 10-11% and 20-25% CAGR over FY18-20, respectively.

Furthermore, capacity expansion plans of key OEMS like Maruti Suzuki, Mahindra & Mahindra, Hyundai Motor India Ltd, etc. indicate that there is sufficient room for demand pick-up. Therefore, this should eventually benefit auto ancillaries.

- VIVEK RANJAN MISRAHead-Fundamental Research

EQUITY

Domestic Economy

• The fiscal deficit in the April-September period was Rs. 5.95 lakh cr vs. FY19 target of Rs. 6.24.lakh cr. The figure stood at 91.3% of the FY18 target at the end of September last year.

• The Reserve Bank of India, through open market operations, is likely to provide liquidity.

• Finance Minister Arun Jaitley will chair a meeting of the Financial Stability and Development Council on Tuesday, to assess the current macroeconomic situation.

Railway

• The Indian Railways is set to bring out a tender to purchase 20 GW solar power in a bid to complete the electrification of the railways, Minister of Railways and Coal Piyush Goyal said.

Automobile

• Maruti Suzuki India Ltd posted the first decline in net profit after 17 quarters as car sales stayed weak due to rising auto fuel prices, higher loan rates and worsening macro-economic factors. India’s largest carmaker by sales was also hit by higher raw material costs and depreciation and amortization expense.

BFSI

• The board of IDFC Bank Ltd approved applying to the Reserve Bank of India to rename the lender as IDFC First Bank, following its merger with Capital First.

• Syndicate Bank has appointed Mrutyunjay Mahapatra as its new Chief Executive Officer.

• The boards of Equitas Holdings and Equitas Small Finance Bank (ESFBL) will meet next month to finalize steps to the listing of the lender for meeting the RBI regulations.

Information Technology

• Tata Consultancy Services completed an order from Extreme Networks to integrate the networking assets of Zebra, Avaya, and Brocade which were acquired by Extreme Networks.

Oil & Gas

• The Directorate General of Hydrocarbons has begun ranking the country’s oil and gas fields in a bid to induce competition among its managers and help boost domestic output stagnant for years now.

Metals

• The promoters of Essar Steel India have proposed to pay Rs. 543.89 bn to lenders to settle its entire debt, outbidding ArcelorMittal, another contender to acquire the debt-laden company.

• JSW Steel reported a near three times jump in its consolidated net profit on a year-on-year basis to Rs. 2,087 cr in the quarter ended September 2018, beating analyst estimates on all fronts.

Telecom

• Consolidation in the Indian telecom industry hasn’t happened in an orderly manner and has come at a heavy price with as much as $50 billion (Rs. 3.7 lakh cr) wiped off from the sector, Bharti Airtel chairman Sunil Mittal said.

NEWS

INTERNATIONAL NEWS

• The European Central Bank on Thursday left monetary policy in the eurozone unchanged once again.

• China has given accreditation to five mustard meal producing units in India after it lifted a six-year-old ban on import of the oilmeal of Indian origin earlier this week.

• China and Japan are expected to sign a raft of deals during Prime Minister Shinzo Abe’s visit to Beijing.

• UK Prime Minister Theresa May invited 120 business leaders to a Brexit question and answer session next week to update them on her strategy for unblocking the stalled negotiations with the European Union.

• Amazon stock fell as much as 9% after posting a record profit.

TREND SHEETSymbol CMP S2 S1 R1 R2 TREND

SENSEX 33349.31 32339 32844 34301 35254 Down

NIFTY 10030 9744 9887 10291 10552 Down

NIFTYBANK 24421.05 23608 24015 25166 25911 Down

BAJFINANCE 2,338.90 1859 2099 2478 2617 Up

RELIANCE 1,044.90 960 1003 1101 1157 Down

IBULHSGFIN 683.90 561 622 738 792 Down

HDFCBANK 1,961.20 1906 1933 2004 2048 Down

YESBANK 180.70 137 159 213 244 Down

ICICIBANK 315.65 301 308 327 337 Up

MARUTI 6,717.30 6302 6510 6915 7112 Down

INDUSINDBK 1,445.80 1310 1378 1557 1668 Down

HDFC 1,702.10 1594 1648 1752 1802 Down

SBIN 248.10 235 242 260 272 Down

FORTHCOMING EVENTSCompany name Result Date

BALLARPUR INDUSTRIES LTD. 29-OCT-18

BHARAT PETROLEUM CORPORATION LTD. 29-OCT-18

CARBORUNDUM UNIVERSAL LTD. 29-OCT-18

CENTURY TEXTILES & INDUSTRIES LTD. 29-OCT-18

CHAMBAL FERTILISERS & CHEMICALS LTD. 29-OCT-18

COLGATE-PALMOLIVE (INDIA) LTD. 29-OCT-18

DCM SHRIRAM LTD. 29-OCT-18

FINOLEX INDUSTRIES LTD. 29-OCT-18

GRANULES INDIA LTD. 29-OCT-18

HDFC ASSET MANAGEMENT COMPANY LTD. 29-OCT-18

JUST DIAL LTD. 29-OCT-18

K.P.R.MILL LTD. 29-OCT-18

KRBL LTD. 29-OCT-18

LIC HOUSING FINANCE LTD. 29-OCT-18

KSTREET - 27TH OCTOBER 2018 1

INDIAN INDICES (% CHANGE)

GLOBAL INDICES (% CHANGE)

NIFTY MIDCAP100TOP GAINERS & LOSERS (1W)

SECTORAL INDICES (% CHANGE)

FII/FPI & DII TRADING (IN RS. CRORES)

NSE NIFTY TOP GAINERS & LOSERS (1W)

EQUITY

-4

-3.5

-3

-2.5

-2

-1.5

-1

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0

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IND

EX

SEN

SEX

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-1000

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500

1000

1500

2000

10/19/20

18

10/20

/2018

10/21/20

18

10/22/20

18

10/23/20

18

10/24

/2018

10/25

/2018

FII/FPI DII


BEAT THE STREET - FUNDAMENTAL ANALYSIS

Maruti SuzukiIndia LtdCMP Rs.6273Target Price Rs.8577Upside 27.6%

Investment Rationale

• We believe that MSIL is well placed to outperform the 4W industry growth in India due to its strong product profile, robust performance in utility vehicle segment and new vehicle launches planned in the near future.

• During H1FY19, MSIL reported robust volume growth of 10% vs. Domestic PV industry growth of 6.9%. The Company sold 975,327 vehicles in H1FY19 compared to 886,661 in H1FY18. This growth was primarily supported by utility segment and the rural markets which grew by 13% in H1FY19

• With 2500+ distribution centers and six blockbuster models (Dzire, Swift, Alto, Baleno, WagonR and Vitara Brezza) MSIL currently dominates the Indian car market. We do not see any major threat to its product portfolio and it’s product pricing from its peers.

• The Management is confident of achieving double digit volume growth (exceeding industry growth) in FY19 based on its strong product portfolio and likely uptake in the economic growth in the country.

• The downside risk for maintaining operating margins can be attributed to higher commodity prices, adverse forex movement and higher discounts.

• However, We understand, scale benefits and richer product mix will enable MSIL to offset commodity cost inflation. In spite of intense cost pressure, Management has not taken a price hike during the quarter.

VALUE PARAMETERSFace Value (Rs.) 5.0

52 Week High/Low (Rs.) 6501/10000

M.Cap (Rs. Bn/US $mn) 2029/27.6

EPS (Rs.) 255

P/E Ratio (times) (FY20E) 21.7

Dividend Yield (%) 1.1

Stock Exchange BSE

% OF SHARE HOLDING

in Rs.Mn ACTUAL ESTIMATE

YE Mar FY 18 FY 19 FY 20

REVENUE 797,627 912,907 1,035,481

EBITDA 120,615 133,436 155,247

EBITDA(%) 15.1 14.6 15.0

PAT 77,218 84,915 99,649

EPS (Rs.) 255 281 330

RoE (%) 19.8 19.1 19.9

P/E CHART

Valuation

The Company reported 10% volume growth in H1FY19. This is a 5th year of average double digit growth. Over FY18-20E, we expect MSIL to report 10% volume CAGR, 13.9% sales CAGR and 13.6% PAT CAGR. It is expected to report EPS of Rs281 and Rs330 in FY19E and FY20E respectively. Currently the stock is quoting at PE of 21.7x FY20E earnings. We reiterate our BUY rating on the stock with a price target of Rs 8577 (PER of 26xFY20E).

EQUITY


BEAT THE STREET - FUNDAMENTAL ANALYSIS

HeidelbergCementIndia LimitedCMP Rs.137Target Price Rs.159Upside 16%

Investment Rationale

• The company is operating with an installed cement manufacturing capacity of 5.4 MTPA (million tons per annum), and capacity utilization at 85.3%

• The RoE is Comparatively better in the industry and in FY19E RoE is expected around 15%. During FY18 the company reported highest ever annual production and sales volume, as well as revenue and EBITDA.

• The top-line of the company is expected to rise with CAGR of 5.38% from FY18-20E & EBITDA is also likely to increase at CAGR of 10.76% from FY18-20E

• The Investment spending in the economy has to move up which would result in pick up of cement demand and due to which we can expect realizations to improve and cement prices could rise up to 10% in the next six months in order to compensate for the increased fuel and transportation costs, according to a top official of the industry body Cement Manufacturers Association (CMA)

• Business of Heidelberg Cement India, contributes to sustainability throughout their lifecycle ,As an active member of the Cement Sustainability Initiative (CSI) of the World Business Council for Sustainable Development (WBCSD), the company stands fully committed to the sustainable development of its business activities, steps were taken to reduce carbon footprint through reduction of specific power consumption and specific fuel consumption and increased usage of cementitious materials like flyash and slag.

• It has signed a 25 year Solar Power Purchase Agreement for its Ammasandra unit. This renewable energy will meet close to 50% of the Ammasandra’s power requirement and will come into effect from FY18-19.

• The company has repaid Rs. 750 mn of debt Q1FY19 and the company is expected to repay another Rs. 750 mn during the rest of the year FY19E. Improvements in the leverage ratios, higher capacity utilization and improvement in demand should lead to margin improvement .

VALUE PARAMETERSFace Value (Rs.) 10.0

52 Week High/Low (Rs.) 190/122

M.Cap (Rs. Bn/US $mn) 29369/401

EPS (Rs.) 5.9

P/E Ratio (times) (FY20E) 17.7

Dividend Yield (%) 1.48

Stock Exchange BSE

Valuation

HeidelbergCement India Ltd is currently trading at EV/EBITDA of 6.76x of FY20E. So we initiate the company for a ‘BUY’ rating valuing at 8.65x EV/EBITDA (5 years average forward multiple) on FY20E EBITDA for the target price of Rs. 159, representing an upside of 23% for the next 12-15 months .

EQUITY

% OF SHARE HOLDING

in Rs.Mn ACTUAL ESTIMATE

YE Mar FY 18 FY 19 FY 20

REVENUE 18895 20323 20984

EBITDA 3634 4281 4458

EBITDA(%) 19.2 21.1 21.2

PAT 1336 1615 1659

EPS (Rs.) 5.9 7.1 7.3

RoE (%) 13.2 15.1 14.5

PE (x) 24.1 18.2 17.7

P/E CHART


EQUITY

BEAT THE STREET - TECHNICAL ANALYSIS

Info Edge (India) Limited

Info Edge India that trades on the ticker “NAUKRI” in NSE is one of the very few profitable pure-play internet companies in the country. Info Edge is India’s premier online classifieds company in recruitment, matrimony, real estate, education and related services. NAUKRI has rallied from 1089.65 to 1697.90 in the daily chart and has corrected to 61.8% Fibonacci retracement levels of the said rally i.e. around 1322 and bounced back from there to close above 23.6% Fibonacci retracement levels, indicating the end of the correction and a possible fresh leg of the rally from these levels. The stock was unfazed by the recent sell-off in the broader markets, indicating bullishness in the counter. Adding to it, Heiken candlesticks and Parabolic SAR is signaling positive trend on the daily charts, reflecting the stock is well placed to move higher in the coming days. 14 periods RSI is trading above the 9-period averages in the daily chart as well as weekly charts, indicating positive momentum. The stock is trading well above all of its major moving averages on the daily as well as weekly charts, indicating a strong positive momentum in the counter for all major timeframes. On Bollinger bands, the weekly chart stock has taken support around the mean and is moving towards the upper band and the bands are expanding, indicating positive momentum. At the current levels, the stock has given an excellent opportunity for medium to long-term investors to accumulate the stock around 1590 levels for the potential upside targets of 1900-2025 levels over the next 6-9 months, keeping a stop loss below 1300 levels.

Merck India Private Limited

Merck is an MNC giant that was incorporated in India as E. Merck India Private Limited in 1967. In 2017, we completed 50 years in India, starting as a pharmaceutical company and growing to become a science and technology business spanning all the sectors of Healthcare, Life Science and Performance Materials. MERCK has rallied from 992 levels in September 2017 to 3554 levels in September 2018 and corrected from there to 2509 levels, which is around 38.20% Fibonacci retracement level of the said rally and bounced back, indicating the end of the correction. Adding to it, the Heiken candlesticks is signaling positive trend on the weekly charts, reflecting the stock is well placed to move higher in the coming days. 14 periods RSI is trading above the 9-period averages in the daily chart, indicating a positive momentum. The stock is trading well above all of its major moving averages on the daily as well as weekly charts, indicating strong positive momentum in the counter for all major time frames. On Bollinger bands the weekly chart stock has taken support around the mean and is moving towards the upper band and the bands are expanding, indicating positive momentum. At the current levels, the stock has given an excellent opportunity for medium to long-term investors to accumulate the stock around 2800 levels for the potential upside targets of 3540-3625 levels over the next 6-9 months, keeping a stop loss below 2250 levels.

Stock NAUKRI

CMP 1597.05

Action BUY

Entry 1590

Average 1340

Stop loss 1300

Target 1900

Target 2 2025

Time Frame 6-9 Months

Stock GEPIL

CMP 2854.35

Action BUY

Entry 2800

Average 2300

Stop loss 2250

Target 3540

Target 2 3625

Time Frame 6-9 Months


EQUITY

Sentiment

Initiation 505

Stop Loss 530

Target 467

Lot Size 1000

Margin 83600

Open Interest Shares 3611000

Change in OI (Weekly) -285000

Cost of Carry (%) -21.71

SECTORAL SNIPPETS

NIFTY REALTY (205.40) ended the week on a flat note outperforming NIFTY-50 which closed with a cut of around 2.65%. The breadth of the REALTY index was also flat as 5 stocks out of 10 stocks in the index ended on a positive note, while 4 stocks ended on a negative note. Stocks which gained in the last week were OBEROIRLTY, SOBHA, DLF,GODREJPROP and PHOENIXLTD which gained 12.77%,1.47%,0.52%,0.16% and 0.10%, respectively, while BRIGADE, IBREALEST, HDIL, and PRESTIGE closed on a negative note with a cut of around 14.81%,7.16%,5.78%, and 3.09%, respectively. Technically, the said index is trading well below its daily & weekly 21-day exponential moving average. The daily 14-period RSI is trading above its 9 periods EMA, while the weekly is trading below its 9 periods EMA, indicating choppy bias. Going ahead for the coming week, the index has support at 198 levels and below it at 192 levels, while resistance is pegged at 212 levels and above it at 219 levels. Going ahead, the index is expected to trade on a choppy note within the range of 200- 212 levels in the near term.

NIFTY BANK (24,421.05) traded highly volatile during the week passed by, taking cues from global markets. However, the index ended the week on a negative note in par with the benchmark index Nifty 50 losing 2.65%. Considering the current market volatility nowadays and as the indications are in favor of further decline the index, the market participants may focus on earnings, global markets and currency movement for further cues. On the stock specific front, barring one, all the stocks ended in red; YESBANK, INDUSINDBK, IDFCBANK and SBIN lost by 16.89% to 5.02% during the week. On the flip side, PNB gained 0.38% with respect to the weekly closing basis. Technically, BankNifty is close to its support levels at 24,240 levels. Below the said levels, the index may face support at 23,900 and 23,600 levels. For the week ahead, resistance for the index can be pegged at 25,350 levels followed by 25,620 levels. On the momentum setup, 60-period daily CCI is plotting below its -100 line, indicating an underlying bearish trend in the index. However, as most of the momentum indicators are plotting in the oversold zone, a further bounce back cannot be ruled out in the index.

NIFTYIT (13,798.60) traded with a negative bias and underperformed the broader market, since benchmark Index Nifty corrected over 2.80%, whereas IT Index closed with cuts of nearly 4.70% in the week passed by. On the stock specific front, all the heavy weightage stocks from the index closed in red for the week with INFIBEAM being the major contributor witnessing a fall of around 44% followed by TCS, INFY, TECHM, MINDTREE, OFSS which fell around 6.28%, 7.24%, 5.42%, 5.13% and 6.49%, respectively. HCLTECH being the only stock from the index to get settled in the green territory with marginal gains of around 1.30%. NIFTYIT has witnessed the heat due to the underestimated Q2 results of the major counters in the previous week and technically, it has started looking very weak. On the daily chart, the counter is in a downtrend placed below all its major moving averages even the long-term (200-DEMA) moving average, suggesting inherent weakness in the counter. On the momentum setup, 14-period RSI on daily timeframe chart is poised with a weak bias, and even on the weekly chart, it has a wide range of 40-60 levels, indicating further downside room in the counter. The next support is pegged around 13,500 levels followed by 13,180-13,200 levels, while on the contrary the resistance is pegged around 14,230-14,250 levels followed by 14,500 levels. Going forward looking at the technical chart and data points, the index is likely to trade with flat to negative biasness in near future and it is advisable to look for stock specific action.

NIFTYPHARM (9,115.10) underperformed the benchmark index NIFTY and closed the week with a negative return of nearly 6%, while the benchmark index NIFTY closed the week with a negative return of nearly 3%. The major losers were the index heavy weights like SUNPHARMA along with BIOCON, CADILAHC, DRREDDY, CIPLA and AUROPHARMA, while on the flip side, PEL and GLENMARK closed the week on a flat note. Technically, the index is making lower lows from the last couple of trading sessions, which placed the index below its major moving averages on the daily chart, suggesting weakness is likely to continue in the index. On the technical indicator front, the 14-period RSI is trading below its 9-day signal line and poised with weak bias, suggesting weakness in the index in near term. The MACD is also trading below the signal line on the daily chart, indicating weakness is likely to continue in the index in near term as well. The immediate support for the NIFTYPHARM is pegged around 8,920-8,900 levels followed by 8,800 levels; while on the higher side, the index may face resistance around 9,170-9,200 levels followed by 9,300 levels. Going forward, we are expecting the index is likely to trade with a negative bias and may underperformed Nifty in the coming week. The stock-specific action is expected to be seen in the sector during the next week.

TITAN COMPANY LIMITED: BUY TITAN (NOV FUTURE) | CMP: 807.40 SECTOR: CD

TITAN witnessed a strong up move from the lower levels of 732 to 800 plus within a short timeframe of three weeks. The stock is trading above the mean of the Bollinger band (20,2) and is trading well above the major moving averages on the daily charts. The stock managed to form a good base around 760-770 levels from past few sessions and is all set to move higher in the coming trade. In the recent past, the counter gave breakout from the sloping trend line above 785 levels and surpassed the major resistance of 800 levels in the last week. The volumes have been encouraging in the recent up move indicating strong hands have started accumulating the stock even at current levels. On the flip side, the stock is having good support around 770 levels on the lower side followed by 750 levels. At the current juncture, the stock is looking bullish and is poised to surge higher towards 850 plus levels with 14 day RSI trading comfortably around 50-52 levels, suggesting positivity in the counter. The short-term traders may buy the stock at 795 levels, keeping a stop loss below 760 in November series for the targets of 852 levels.

Sentiment

Initiation 795

Stop Loss 760

Target 852

Lot Size 750

Margin 99800

Open Interest Shares 14022750

Change in OI 144750

Cost of Carry (%) 0.67

VOLTAS LIMITED: SELL VOLTAS (NOV FUTURE) | CMP: 496.70 SECTOR: CD

VOLTAS closed the week on a negative note ending at 507 levels. Technically, the stock is trading below its major moving averages on the daily chart, exhibiting underlying weakness in the stock. On the technical indicator front, the 14-period RSI is trading below its 9-day signal line on the weekly chart and poised with weak bias, indicating downtrend in the counter in the near term. The Parabolic SAR (Stop & Reverse) on the weekly chart is trading above the price on the daily chart, indicating weakness is likely to continue in the stock. The derivatives data suggests that the stock has witnessed closure of long positions during the last trading session, re-confirming our bearish view. From the above observation of price momentum, it seems the stock is likely to trade with a negative bias and may move lower towards the psychological mark of 470 levels continuing the recent trend. Hence, we recommend the short-term trader to go short in the stock around 505 levels with a stop loss placed above 530 for the lower target of 467 levels.


WEEKLY VIEW OF THE MARKET

NIFTY (10,030.00): In the week gone by, markets continued to slide lower relentlessly, as global cues continued to dictate terms to the Indian markets. The global rout thereby dragged Nifty index lower by 2.65% on a weekly closing basis. Nifty has already wiped out all its gains in the calendar year and is currently trading lower by 4.75% for the year. During the last week, markets stay put in highly volatile mode, aggravating the bearish sentiment. During the whole of October 2018 derivatives series, pessimism continued to lurk market participants. For the second time in a row, a strong bout of selling due to the global sell-off, dragged the markets lower, by breaking a number of supports. It was evident with Nifty’s every attempt to rise back after tumbling down was getting sold into and eventually, index gave up and settled lower by around 8% as derivatives contracts for October series expired. Even though the broader markets witnessed bloodbath, sectors like banking and select Mid-cap stocks managed to eke out nominal gains versus the benchmark index. Rollover data suggests addition of short positions in Nifty front, clearly indicating that the bears still have the upper hand and the bulls will have a mountain to climb in order to get rid of the current pessimism. As far as technical supports for the Nifty are concerned, immediate weekly supports are seen around 9900-9800 followed by 9750-9700. Whereas on the upside, 10250-10300 zone is posing as a stiff hurdle on a weekly basis, crossing which a short covering rally towards 10,400-10,450 cannot be ruled out. We expect Nifty to trade in a range of 9800-10,300 during this week with a possibility of a sharp move of 150-200 odd points in either direction if the said range is broken, as the volatility is still spiking from time to time. Having said this, we recommend that traders adopt a disciplined trading approach in the week to come.

DERIVATIVE STRATEGIES

Type: Put Ratio Spread in Nifty

First leg Buy one lot of NIFTY NOV 10000 PE @ 210

Second leg Sell two lots of NIFTY NOV 9800 PE @ 140

BEP LBEP: 9530 & UBEP: 10070

Max Profit 20,250 (If expires @ 9800 )

Max Loss Unlimited below LBEP

Stop loss 9550 (Spot Levels)

Rationale The Index is on the verge of giving fresh break down below the psychological mark of 10,000 levels and is thereafter expected to consolidate in the range of 9700-10,300 levels in the current expiry.

DERIVATIVES

Type: Bear Put Spread in BANKNIFTY

First leg Buy one lot of BANKNIFTY 01NOV 24400 PE @ 265

Second leg Sell one lot of BANKNIFTY 01NOV 24200 PE @ 185

BEP 24320

Max Profit 2,400

Max Loss 1,600

Stop loss 24,900 (Spot levels)

Rationale The index has been trading with a negative bias from last few sessions and is looking extremely weak on the charts at current juncture. The price is expected to test the lower levels of 24,100-24,200 in the near term.

Type: Bull Call Spread in TITAN

First leg Buy one lot of TITAN NOV 840 CE @ 25

Second leg Sell one lot of TITAN NOV 860 CE @ 18

BEP 847

Max Profit 9,750

Max Loss 5,250

Stop loss 765 (Spot Levels)

Rationale The stock is currently trading around its long term moving averages on the daily charts and is looking strong to test the higher levels of 840-860 levels in the near term.

Type: Bear Put Spread in AXISBANK

First leg Buy one lot of AXISBANK NOV 520 PE @ 22.50

Second leg Sell one lot of AXISBANK NOV 500 PE @ 16

BEP 513.50

Max Profit 16,200

Max Loss 7,800

Stop loss 570 (Spot levels)

Rationale The stock has given a fresh break down below the psychological mark of 550 and has given a close well below the long term moving average of 200-DMA.

7KSTREET - 27TH OCTOBER 2018

DERIVATIVES

FII’S ACTIVITY IN INDEX FUTURES FII’S ACTIVITY IN STOCK FUTURES

TOP 6 LONG BUILD UP

Stock Name LTP % Price Change Open Int % OI Change

ARVIND 321.3 0.64 5550000 10.96

DHFL 184.1 0.14 19855500 9.56

BEL 88.25 5.88 26574750 9.43

SRF 1791.55 2.93 678000 7.02

TATAMOTORS 168.5 1.91 67230500 5.87

MRF 63056.2 2.76 22690 5.34

BANKNIFTY OPTION OI CONCENTRATION (WEEKLY) CHANGE IN BANKNIFTY OPTION OI (WEEKLY)

TOP 6 SHORT CLOSURE


CHOLAFIN 1205.8 2.18 534500 -6.64

TORNTPHARM 1626 2.98 424000 -6.09

DISHTV 40.9 10.69 40864000 -5.70

CESC 848.15 1.66 3009050 -5.15

CEATLTD 1106.1 8.86 905800 -4.36

KAJARIACER 381.75 5.65 2053000 -4.20

TOP 6 SHORT BUILD UP


EQUITAS 99.05 -22.77 14952000 62.88

GRASIM 759.05 -3.27 6627000 16.14

REPCOHOME 331.30 -2.77 669600 14.81

UBL 1114.75 -4.21 1775200 10.94

HEXAWARE 321.20 -3.14 5904000 9.94

VOLTAS 506.95 -3.75 3611000 8.57

TOP 6 LONG CLOSURE


BATAINDIA 908.95 -1.54 1563100 -11.13

NTPC 159.30 -1.85 31676000 -9.92

JUBLFOOD 1055.55 -1.73 2947500 -3.91

SRTRANSFIN 1071.75 -1.19 3643800 -3.57

VEDL 203.65 -0.46 31403750 -2.85

IGL 250.45 -1.44 2068000 -2.72

NIFTY OPTION OI CONCENTRATION CHANGE IN NIFTY OPTION OI


COMMODITIES

BULLIONBullion market had witnessed a strong positive movement during the week ended on 26th October 2018 on the emergence of haven investment. Sell off in the global equity market led to risk aversion buying in the bullion market. COMEX gold futures for December delivery surged to 3 months high of $1246 per troy ounce by 2100 hrs IST on Friday from the weekly low of $1222.90 per troy ounce. During the week, major equity indices tanked over 3%, resulting in buying in the yellow metal. During mid of the week, COMEX gold futures took correction as investors booked profits on the recent surge in the prices. A host of economic events had a relevant impact on the bullion market on the day of release. During the week, major economic releases from the US were new home sales, pending home sales, durable goods orders, weekly unemployment claims, advanced quarterly GDP numbers. The US trade balance for October came at USD -76.0 bn against the previous month’s reading of USD -75.5 bn; unemployment claims increased by 215K from the previous reading of 210K and pending home sales also improved by 0.5% in October against a drop of -1.9% during the last month. Moreover, global economic uncertainties such as the geopolitical tension between the US and Saudi Arabia, concern over Italy’s budget, Brexit deal have a positive impact on the bullion market. On the domestic front, MCX gold futures also moved in synch with the international market. Most active December contract MCX gold futures surged to trade above Rs. 32,000 per 10 grams.

SPICESCardamom futures traded in a narrow range during the week on lack of fresh cues. Lower production during the ongoing season due to adverse weather conditions continued to support prices. A slight slowdown in buying at higher prices was observed at the spot markets during the week, amid declining arrivals. Exporters are actively buying cardamom at the spot markets even though exports to Saudi Arabia are yet to start. On the other hand, there are concerns that traders may opt for more quantity of illegal cheap imports from Guatemala to mix with domestic variety. For the week, cardamom futures to trade in positive note tracking overall bullish factors in the market. Turmeric futures traded mostly on a positive note during the week; active buying at the spot markets ahead of festival supported gains. For the week ahead, gains in turmeric futures are expected to extend further tracking the positive factors in the market. Production is expected to increase compared to the last year due to higher acreage. However, as per latest reports, there are concerns raised on the growth of the crop that may result in a drop in yield levels in a few regions. Jeera futures fell during the week on profit booking after prices rallied to their multi-month high last week. However, major fall was capped on active buying in the spot market ahead of the festivals amid supply concerns. Strong export demand is expected for jeera as India is the major supplier to the world market. Market focus could shift towards sowing activities under jeera, as prevailing prices are higher for the commodity. There is an anticipation of higher sowing area during the upcoming sowing season. However, there are concerns that area may lose if rainfall remains scanty in the major growing regions of Gujarat. Overall, the prices could trade lower for the week on extended long liquidation; but the medium term is positive. Dhaniya futures, after a brief correction in the recent rally, resumed bullish trade during the week. Expectations of a sharp decline in the sowing area under dhaniya supported gains. Farmers may shift cultivation from dhaniya to other remunerative crops as they have got poor returns for the 2-3 straight seasons by cultivating dhaniya. Hence, Bull Run in dhaniya futures could continue further and prices may touch 6000 levels in the short term. However, a sharp increase in prices in a few days may prompt few farmers to perceive with dhaniya for the season.

BASE METALSBase Metals segment remained in a price range during the whole week primarily driven by data of economic events and brief impact of fundamental factors. LME Aluminium extended its losses on a weekly basis after International Aluminium Institute released its report on Tuesday, which stated that the world primary Aluminium production rose by 2.5% YoY in Sep 2018 from 5.17 million tons to 5.3 million tons. Also, the total was down from the prior month by 3.4% when global smelters churned out 5.485 million metric tons. Global production for Jan-Sep 2018 totalled 48.022 million tons, a year-on-year rise of 0.3% from 47.86 million tons last year. This despite a fall in production from smelters in China, as the total for the first nine months of the year from Chinese producers fell by 0.7% YoY from 27.38 million tons to 27.17 million tons. Incremental production this year has been witnessed from GCC and Other Asian nations while Chinese and North America production witnessed a decline during the year, amid the ongoing uncertainty over trade tariffs on Chinese imports into the USA. On the other hand, Lead rose by $12 a ton during the middle of the week and dropped towards the end of the week. The global lead market deficit narrowed to 6,300 tons in August after a revised deficit of 7,600 tons was recorded in July supported the fall in prices. However, Zinc hovered around

$2,600 a ton taking its support from ILZSG reports released on Wednesday, which highlighted a 6,500-ton deficiency in August. The end of the week on Friday’s session tested the strength of the metals against its fundamentals as negative US GDP growth had affected the prices much.

ENERGY COMPLEXCrude oil prices went down for the third consecutive week, wherein the prices noted the corrections massively amid the assurance from Saudi Arabia & Russia as to compensate for the Iranian shortfalls and also prices went into vain after Saudi Arabian Energy minister warned of oversupply in the coming quarter of 2019. Saudi Arabia said that the oil market could be shifting towards oversupply in the fourth quarter of the year as oil inventories rise and demand slows. OPEC signaled that it may have to return to oil production cuts as global inventories rise, in a statement which may further sour relations with the US President Donald Trump. Also eroding demand support was news from China where Sinopec Group and China National Petroleum Corp (CNPC) have not made any nominations to load Iranian oil for November over the concerns they would be violating the US sanctions. The prices, in the start of week, traded positive over the increasing geopolitical tensions between Saudi Arabia & west over the killing over journalist in Turkey. International Energy Agency (IEA) Chief Fatih Birol said that he is not worried Saudi Arabia will cut oil supply in response to any potential sanctions over the killing of journalist Jamal Khashoggi but urged common sense as political developments may impact energy markets. Meanwhile, EIA reported a surge in U.S. natural gas stocks by 58 Bcf which it was more than the expectation and went negative for the prices.

OILS & OILSEEDSSoybean futures are expected to trade sideways to higher could track increased buying activities at key trading centers. The improved demand of meal and commencement of Bhawantar Bhugtan scheme in Madhya Pradesh is likely to support prices in near term. Apart from that, the improved export outlook of soymeal resulting with excessive weakness in Indian currency could be another factor which may support prices in the near term. However, surging arrival pressure at the physical market could cap the excessive gains. The daily arrivals of soybean have reached above the 6 lakh bags and are expected to improve further in line with expanding harvesting activities. Similarly, expected rise in export demand of mustard seed cake from China could support RM Seed prices in the near term. China has lifted the ban on the import of the mustard seed cake from India. Although, gains could be limited as ongoing sell-off of mustard seed stocks by NAFED below to Rs. 4000 per quintal level could pull down the futures prices soon in term of basis correction. Likewise, CPO futures could trade on a weaker note on higher production outlook in major growing countries. Meanwhile, Malaysia’s Oct 1-25 palm oil exports fell 17.4% reported at 10,96,139 MT against the 13,26,748 MT of the prior month. MPOB released its production estimates for Sep pegged production at 18.53 lakh tons against the 16.2 lakh tons of Aug, wherein export estimated at 16.18 lakh tons higher by 47% MoM. Inventory levels increased up to 25.41 lakh tons against the 225.0 lakh tons of the prior month. Import in India reported at 363,799 MT in July against the 304,577 MT of the prior month, higher by 19% MoM as per the data compiled by Solvent Extractor Association of India.

COTTONCotton futures are expected to trade on mixed to lower in the coming week on improved arrivals across India. The daily arrivals of cotton are ruling in a range of 75,000-90,000 bales and expected to pick up further in line with accelerating harvesting activities in major cotton-growing states. Moreover, the bearish outlook for ICE cotton futures could be another factor which may weigh on prices. Ongoing harvesting activities in the US and trade tension between the US and China could affect market sentiments negatively. About 39% of the crop for the year 2018-19 in the US has been harvested till 21st Oct shown in the weekly report released by USDA. Although, farmers are adopting a cautious approach before selling their produce avoiding bulk deal in anticipation of further rise in prices. Reports of weaker production in Gujarat and Maharashtra and expected rise in seasonal demand of cotton could cap the excessive losses in cotton. The government released its first advance estimated of production for the year 2018-19 estimated overall cotton production at 324.83 lakh bales against the 348.88 lakh bales of the prior year, lower by 7% YoY. Gujarat State government pegged cotton production for the year 2018-19 at 88.28 lakh bales of 170kg each against the 101.87 lakh bales of the prior year. USDA has estimated cotton yield in India may stand near about 525 kg/hac in the year 2018-19 compared to 509 kg/hac of the prior year. Cotton Association of India estimated beginning stocks for the year 2018-19 at 23 lakh bales, wherein total production is projected at 348 lakh bales against the 365 lakh bales of prior year lower by 5% YoY. USDA rated 34% of the crop in good to excellent condition till the end of 21st Oct against the 56% of the prior year for the corresponding period.


COPPER LME

As on 26th October 2018, LME 3M forwards were trading around 6150 levels. Since last several sessions, the prices are trading within a confined range of $6350-6100 levels. Prices are finding important support around 6100-6080 levels, which is the falling trend line and as well as the Fibonacci 50% retracement of the range 5799-6387. The momentum oscillator is trading above the zero line. The overall short-term bullish trend is in progress; we are expecting commodity to move higher up to 6340 in the coming week. MCX Copper November contract delivery futures are expected to trade in the range of 435-465 with a positive bias.

MENTHA OIL

As on 26th October 2018, Mentha oil futures were trading around Rs 1784. In the mentioned price chart, it is visible that prices have broken falling trend line resistance around 1740 and hovering above the same. In addition, prices are trading above the 8&13 exponential moving averages resistance levels and also averages are witnessing bullish crossover. The momentum indicator RSI-14 is trading around 71, not providing a major clue. The oscillator MACD is trading above the “0” and the signal line crossed the baseline. While combining the above clues, we are expecting commodity to move higher up to 1822(Previous top) 1850 (Fibonacci 100% projection levels). Supports are seen at 1740 break out point as well as the 21EMA support levels, major support at 1675 previous low.

COTTON SEED OIL CAKE

As on 26th October 2018, Cocud futures at the NCDEX platform settled at Rs 1873/quintal. In the mentioned price chart, the prices are trading above the weekly 8,13EMA support levels, in addition to this moving averages the bullish crossover is witnessing. The momentum oscillator MACD is trading above the ‘0’ line. The prices are witnessing a Flag pattern formation, pattern break out point is at 1770 levels. Overall, the commodity is expected to move higher up to 2000 mark in the coming week.

COMMODITIES

TREND SHEET

Commodities 19-Oct 26-Oct % Change 52 Week High% Change from 52

Week High52 Week Low

% Change from 52 Week Low

MCX Gold (Rs/10 gms) 31902.00 32136.00 0.7% 32311.00 -0.54% 28055.00 14.55%

MCX Silver (Rs/Kg) 38796.00 38925.00 0.3% 41698.00 -6.65% 36000.00 8.13%

MCX Crude Oil (Rs/bbl) 5087.00 4949.00 -2.7% 5669.00 -12.70% 3372.00 46.77%

MCX Natural Gas (Rs/mmBtu) 238.30 231.30 -2.9% 250.80 -7.78% 162.50 42.34%

MCX Copper (Rs/kg) 453.00 444.30 -1.9% 493.25 -9.92% 402.55 10.37%

MCX Lead (Rs/kg) 145.90 145.95 0.0% 172.50 -15.39% 137.25 6.34%

MCX Zinc (Rs/kg) 196.60 198.05 0.7% 232.70 -14.89% 163.80 20.91%

MCX Nickel (Rs/kg) 914.30 867.80 -5.1% 1095.20 -20.76% 692.80 25.26%

MCX Aluminium (Rs/kg) 147.95 145.05 -2.0% 178.85 -18.90% 128.30 13.06%

NCDEX Soybean (Rs/Quintal) 3246.00 3259.00 0.4% 3895.00 -16.33% 2754.00 18.34%

NCDEX Refined Soy Oil (Rs/10 kg) 765.60 752.00 -1.8% 796.35 -5.57% 672.80 11.77%

NCDEX RM Seed (Rs/Quintal) 4173.00 4176.00 0.1% 4262.00 -2.02% 3727.00 12.05%

MCX CPO (Rs/10 kg) 589.80 567.00 -3.9% 673.00 -15.75% 538.20 5.35%

NCDEX Castor Seed (Rs/Quintal) 5266.00 5466.00 3.8% 5538.00 -1.30% 3831.00 42.68%

NCDEX Turmeric (Rs/Quintal) 6560.00 6670.00 1.7% 8066.00 -17.31% 6316.00 5.60%

NCDEX Jeera (Rs/Quintal) 20365.00 19590.00 -3.8% 22360.00 -12.39% 14010.00 39.83%

NCDEX Dhaniya (Rs/Quintal) 5646.00 5787.00 2.5% 6021.00 -3.89% 4186.00 38.25%

MCX Cardamom (Rs/kg) 1424.50 1422.00 -0.2% 1458.30 -2.49% 818.50 73.73%

NCDEX Wheat (Rs/Quintal) 2044.00 2031.00 -0.6% 2074.00 -2.07% 1575.00 28.95%

NCDEX Guar Seed (Rs/Quintal) 4544.50 4696.50 3.3% 4784.00 -1.83% 3465.00 35.54%

NCDEX Guar Gum (Rs/Quintal) 9806.00 10272.00 4.8% 10510.00 -2.26% 7200.00 42.67%

MCX Cotton (Rs/Bale) 22780.00 23110.00 1.4% 24280.00 -4.82% 18180.00 27.12%

NCDEX Cocud (Rs/Quintal) 1797.00 1873.50 4.3% 1898.00 -1.29% 1166.00 60.68%

NCDEX Kapas (Rs/20 kg) 868.00 868.00 0.0% 1010.00 -14.06% 854.00 1.64%

MCX Mentha Oil (Rs/kg) 1702.30 1784.50 4.8% 1991.90 -10.41% 1106.00 61.35%

TECHNICAL RECOMMENDATIONS


COMMODITIES

CALENDER SPREAD NYMEX - CRUDE OIL CALENDER SPREAD NYMEX - NATURAL GAS

NEWS DIGEST

• Union Commerce Minister Suresh Prabhu on Thursday said specific agriculture export zones, which are well-connected to ports and airports, will be set up in the country to boost exports of farm products. Speaking at an event organized by Agricultural and Processed Food Products Export Development Authority (APEDA), he said the government had drafted a new national agriculture export policy to support the export of organic products.

• Sowing of winter (rabi) crops has begun and the coverage of oilseeds has gone up 70% to 14.61 lakh hectare so far over the year-ago period, according to government data. Wheat has been sown in 18,000 hectares so far in the rabi season of the 2018-19 crop year (July-June) as against 2,000 hectares in the year-ago period. Sowing of rabi crops begins in October and harvesting from March. Wheat is the main rabi crop.

• During much of the current government’s tenure, Indian farmers have suffered from poor crop realizations, partly due to the crash in global agri-commodity prices after around April 2014 and aggravated by demonetization and GST (goods and services tax) that have depressed sentiment in predominantly cash-based produce markets.

• Northeast Monsoon 2018 has been playing hide and seek with the country ever since the beginning of the October. Right from the probabilities of making the earliest onset, it is now heading towards most delayed onset.

WEEKLY COMMENTARY

• The International Lead and Zinc Study Group (ILZSG) convened its 63rd session earlier this month in Lisbon, Portugal, during which it reviewed global demand forecasts for this year and next with respect to zinc and lead. According to ILZSG, global zinc demand is set to rise by 0.4% in 2018 to 13.74 million tons (MT) and by 1.1% in 2019 (up to 13.88 MT).

• Global aluminum production growth has ground to a halt this year. Cumulative production grew by just 0.3% in the first nine months, the slowest rate of expansion since the Global Financial Crisis (GFC) in 2008-2009. Smelter outages in Canada and Brazil continue to constrain run rates in the Western World, while structural reform in China is capping output in the world’s largest aluminium producing nation. In theory, the potential exists for a re-acceleration in growth in both China and the rest of the world.

• Gold held a slight gain but moved little after a government report Friday showed that the US gross domestic product rose by a seasonally adjusted annual rate of 3.5% in the third quarter. This was the government’s first estimate of economic growth for the July-September quarter, showing that growth slowed some from 4.2% in the second quarter.

• Emerging Asian currencies weakened across the board against the dollar on Friday, with Malaysia’s ringgit at its lowest in nearly a year and the Chinese yuan at a 22-month nadir as a continuing sell-off of Asian equities hurt sentiment.

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COMMODITIES

PRICES OF METALS IN LME/ COMEX/ NYMEX (IN US $)

Commodity Exchange Contract 12-Oct 19-Oct % change

Aluminium LME 3M 2006.50 1990.50 -0.80%

Copper LME 3M 6222.00 6197.50 -0.39%

Lead LME 3M 1995.50 2004.00 0.43%

Nickel LME 3M 12475.00 12185.00 -2.32%

Zinc LME 3M 2623.00 2650.00 1.03%

Gold CME DEC 1230.00 1234.60 0.37%

Silver CME DEC 14.65 14.66 0.07%

WTI Crude oil CME OCT 69.37 66.98 -3.45%

Natural Gas CME OCT 3.23 3.17 -1.92%

INTERNATIONAL COMMODITY PRICES

Commodity Exchange Contract 12-Oct 19-Oct % change

Soybean CBOT NOV 883.00 870.00 -1.47%

Soy oil CBOT DEC 29.13 28.43 -2.40%

CPO BMD DEC 2222.00 2147.00 -3.38%

Cotton ICE DEC 77.90 77.60 -0.39%

SPOT PRICES (% CHANGE)

LME WAREHOUSE STOCKS (IN TONS)

Commodity Previous week This week Change % Change

Copper 154225 146350 -7875 -5.11%

Zinc 167450 155225 -12225 -7.30%

Aluminium 1062350 1049175 -13175 -1.24%

Lead 114575 111875 -2700 -2.36%

Nickel 219636 219456 -180 -0.08%

SHANGHAI WAREHOUSE STOCKS (IN TONS)*


Copper 140789 148943 8154 5.79%

Zinc 53479 48416 -5063 -9.47%

Aluminium 820675 814042 -6633 -0.81%

*Until Wednesday

COMEX WAREHOUSE STOCKS (IN TONS)


Copper 166200 163866 -2334 -1.40%

WEEKLY STOCK POSITION IN LME (IN TONS)

Supply & Demand Data - Metals

WORLD PRIMARY ALUMINIUM PRODUCTION

Region China GCCNorth

AmericaEurope

Other Asia

Others World

Sep-17 2.91 0.40 0.32 0.64 0.34 0.56 5.17

Aug-18 3.12 0.45 0.32 0.66 0.38 0.55 5.49

Sep-18 3.01 0.44 0.31 0.64 0.36 0.54 5.30

Sep'18 vs Aug'18 -3.5% -3.3% -3.1% -3.0% -3.4% -2.9% -3.4%

Sep'18 vs Sep'17 3.6% 8.2% -4.3% 0.8% 6.4% -3.6% 2.5%

Jan-Sep 2017 27.38 3.85 2.96 5.81 2.89 4.98 47.86

Jan-Sep 2018 27.18 4.00 2.80 5.83 3.30 4.92 48.02

YoY growth (%) -0.7% 3.9% -5.1% 0.3% 14.0% -1.3% 0.3%

Jan-Sep 2018 YoY production change

(mn tons)-0.20 0.15 -0.15 0.02 0.41 -0.06 0.16

Source: International Aluminium Institute

Aug 2018 Jul 2018Jan-Aug

2018Jan-Aug

2017

Global Lead Supply and demand

Mine Output (Lead Content) 364.6 368.7 2,965 3,005

Total Refined Output 987.5 965.5 7,593 7,636

Refined Consumption 993.8 973.1 7,707 8,990

Refined Market Balance -6.3 -7.6 -114 -120

Global Zinc Supply and demand

Mine Output (Zinc Content) 1054.50 1053.60 8341 8175

Total Refined Output 1048.00 1052.00 8687 8629

Refined Consumption 1124.20 1127.70 8979 8990

Market Balance -76.20 -69.70 -292.00 -361.00

Source: International Aluminium Institute

-5.39%

-4.53%

-2.86%

-1.62%

-1.51%

-0.73%

-0.60%

-0.09%

0.05%

0.35%

0.34%

0.37%

0.46%

0.53%

0.79%

0.88%

1.44%

2.01%

2.84%

3.65%

5.40%

7.97%

8.03%

9.27%

11.68%

-0.08 -0.06 -0.04 -0.02 0 0.02 0.04 0.06 0.08 0.1 0.12 0.14

Turmeric

Lead

Crude Oil

Copper

Nickel

Aluminum

Natural Gas

Cotton

Silver

Gold

CPO

Soybean

Zinc

Cotton Seed Oil Cake

Wheat

Mentha Oil

Jeera

Soy Oil

RM Seed

Cardamom

Barley

Castor Seed

Guar Gum

Guar Seed

Dhaniya


USD/INR

This is the daily charts of USDINR FUT pair, the pair has been trading in a broader range of 73.88 on the higher side and 73.10 on the lower side for the week. The pair corrected from the higher levels and found support near 73.10 levels. The pair has been trading above the 50DMA & 20DMA placed at 73.37, while RSI (Relative Strength index) placed at 54 and MACD remains above the zero line.

BUY USDINR FUT 73.10-73.00 TGT 73.70 SL 72.85

EUR/INR

This is the daily chart of EURINR, the pair traded in a broader range of 84.99 on the higher side and 83.22 on the lower side. The pair had a strong momentum on the downside and violated the supports of 84.40 and trended on the lower side. The Relative Strength is at 39, while MACD has a negative crossover, as pair trades below the 20DMA & 50DMA .

SELL EURINR FUT 83.75-84.10 TGT 82.90 SL 84.40

GBP/INR

This is the daily chart of GBPINR, traded in a range of 96.05 on the higher side and 93.77 on the lower side. The pair traded lower and violated the support of 94.70 and trended on the downside the pair traded below the 20DMA and 50DMA, while Relative Strength index is placed at 37 levels and MACD is having a bearish crossover.

SELL GBPINR FUT 94.20-94.55 TGT 92.90 SL 94.95

JPY/INR

This is the daily chart of JPYINR FUT trade in a broader range of 65.72 on the higher side and 64.70 on the lower side. The pair had sidewise move this week, after taking support at 64.70. The pair had a bounce with prices trade above 20DMA and 50DMA and MACD above zero line and relative strength index at 55 expects demand to continue from the lower level.

BUY JPYINR FUT 65.25-65.05 TGT 65.95 SL 64.77

TECHNICAL RECOMMENDATIONMARKET STANCE

Despite sharp cuts in Crude prices, USDINR was able to stick to its base, not moving in parallel with the crude prices. Albeit, Crude moving lower brought in some cheers to the Rupee, Foreign Portfolio investors continuing to be net sellers in Domestic markets spoiled the party, while Dollar index extended its gains boosted by the weaker Euro and Pound. Euro remained lower during the week battered by the weaker economic data. Euro resumed its weakness with weaker than anticipated PMI numbers. The European Central Bank kept the interest rate unchanged at 0% as globally expected, while reiterating its target to end asset purchase program in December 2018, Draghi said significant stimulus still needed for inflation. He also pointed out that incoming data has been weaker than expected. Pound moved in parallel with Euro on the back of positive dollar and Bloomberg reports that Brexit talks are said to be on hold as Mays team can’t agree. Yen gained this week supported by a sharp drop in US yields. US yields came down from 3.18% to 3.08% as the global investors remained away from riskier assets. Elevated geopolitical tensions also increased the demand for safe-haven Yen.

NEWS FLOWS OF LAST WEEK

• Weaker home sales data fueled jitters about economics and profit growth, leading the US equity indices to take large dips yesterday. Disappointing forecasts from the IT industry added to the downside.

• Slower Eurozone business growth dampened global risk sentiment sending Euro southward, which initiated the DXY’s move up above the crucial 96 handle racing towards 97.

• Oil prices extended falls from the previous week, crude slumped by more than 4%, after Saudi Arabia said it would make up for supply disruptions from the US sanctions targeting Iran’s petroleum exports from next month.

• UK PM May spokeswomen said technical Brexit talks are ongoing, Minister will go to Brussels as soon as is Necessary.

• PBOC Deputy Governor Pan Gong Sheng said stable fundamentals could keep Yuan stable and pointed Yuan as healthy amongst emerging market currencies.

• India Forex Reserves decreased to $393.52 billion during the week ended on 19th October 2018 from $394.47 billion in the previous week.

CURRENCY

CURRENCY TABLE

Currency Pair Open High Low Close

USDINR 73.30 73.83 73.09 73.46

EURINR 84.39 84.67 83.20 83.35

GBPINR 95.81 95.96 93.78 93.98

JPYINR 65.11 65.66 64.87 65.55


ECONOMIC GAUGE FOR THE NEXT WEEK

Date Local Time Country Indicator Name Period Poll Prior Unit

29-Oct 18:00 United States Core PCE Price Index MM Sep 2018 0.1 0 Percent

30-Oct 19:30 United States Consumer Confidence Oct 2018 136 138.4 Index

31-Oct 20:00 United States EIA Weekly Crude Stocks W 26 Oct - 6.346 Barrel

31-Oct 20:00 United States EIA Weekly Dist. Stocks W 26 Oct - -2.262 Barrel

31-Oct 20:00 United States EIA Weekly Gasoline Stk W 26 Oct - -4.826 Barrel

31-Oct 20:00 United States EIA Weekly Crude Imports W 26 Oct - -0.335 Barrel

31-Oct 20:00 United States EIA Weekly Rfg Stocks W 26 Oct - 0.003 Barrel

31-Oct 20:00 United States EIA Weekly Refining Util W 26 Oct - 0.4 Percent

31-Oct 20:00 United States EIA Wkly Crude Cushing W 26 Oct - 1.371 Barrel

31-Oct 06:30 China (Mainland) NBS Manufacturing PMI Oct 2018 50.7 50.8 Diff.Idx

31-Oct 06:30 China (Mainland) Composite PMI Oct 2018 - 54.1 Diff.Idx

31-Oct 19:15 United States Chicago PMI Oct 2018 60 60.4 Index

1-Nov 07:15 China (Mainland) Caixin Mfg PMI Final Oct 2018 49.9 50 Diff.Idx

1-Nov 19:15 United States Markit Mfg PMI Final Oct 2018 - 55.9 Diff.Idx

1-Nov 19:30 United States ISM Manufacturing PMI Oct 2018 59 59.8 Index

1-Nov 01:00 United States Total Vehicle Sales Oct 2018 17.1 17.44 No. of

2-Nov 18:00 United States Non-Farm Payrolls Oct 2018 190 134 Person

2-Nov 18:00 United States Private Payrolls Oct 2018 183 121 Person

2-Nov 18:00 United States Unemployment Rate Oct 2018 3.7 3.7 Percent

2-Nov 18:00 United States Average Earnings MM Oct 2018 0.2 0.3 Percent

2-Nov 18:00 United States International Trade $ Sep 2018 -53.7 -53.2 USD

2-Nov 18:00 United States Goods Trade Balance (R) Sep 2018 - -76.04 USD

2-Nov 19:30 United States Factory Orders MM Sep 2018 0.4 2.3 Percent

CURRENCY


IAP Activity in Karvy Meerut Branch

DEMATERIALISATIONIS MANDATORY

As per the notification issued by Ministry of Corporate Affairs, unlisted companies cannot issue physical shares from 2nd October, 2018. They have to issue shares in demat form only.

• Buyback, bonus issue and rights issue cannot be issued by these companies unless securities of company’s promoters, directors, etc. are in dematerialised form.

• Any investor who holds shares in unlisted companies has to get it dematerialised if he wants to transfer shares

• Any investor who wants to buy shares through private placement or avail bonus shares and rights issue has to hold shares in dematerialised form.

All unlisted companies are required to secure ISIN from CDSL or NSDL for each type of security.

Karvy being a pioneer in the financial realm since 3 decades and providing depository and RTA services as well can facilitate the process of dematerialisation of existing shares and also offer demat account opening facility.

Q. What is the main objective of a Demat account?

The main objective of a demat account is to facilitate easy trade and transfer of the shares and also enable an investor to get the benefits of corporate actions like bonus shares, dividend, rights issue, etc.

Q. How many accounts can I have?

• You can open more than one Demat Account.

• You can hold shares, debentures, bonds, NSC, KVP in a single Demat Account.

• You can save charges on multiple accounts by consolidating your holdings into one account, if there are no other compelling reasons to keep separate accounts.

Q. Can I take a loan on my demat holding?

1. Yes, you can pledge the securities in your account in favor of a lender to avail a loan.

Q. Is there nomination facility in Demat Account?

• Nomination can be made only by individuals holding beneficiary accounts either singly or jointly.

• The Nominee needs to complete a few formalities with DP and get the securities transferred into his/her account.

STEPS TO TRANSFER SHARESFROM ONE DEMAT ACCOUNT TO ANOTHER

Fill the DIS form & submit to your current broker

Your broker will send request to

depository (NSDL/CDSL)

Depository shall transfer the shares to your new Demat

Account

Shares shall reflect in your new Demat

Account

Investor surrenders the physical certificates to the DP

DP informs the

Depository about the request

DP submits the certificates to the Registrar of the issuer company

Registrar communicates

with the depository to confirm the

request

Dematerialization of the certificates

is done by the Registrar

Registrar informs the

depository about completion of

dematerialization

1 2 3 654

STEPS TO CONVERT PHYSICAL SHARES TO DEMAT

Q. Do I have to contact all companies for any updation in my personal details?

For your demat shares, your one point contact for all the changes/updation is DP.

Q. What precautions should I take to prevent misuse of securities lying in my account?

• Keep DIS book in safe custody.

• When writing an instruction on the DI Slip, strike-out the empty spaces.

• Change your password frequently if you are using internet facility for your Demat Account.

• Before giving Power of Attorney (POA) to any person operating your Demat Account, understand the contents and implication of such POA.

Q. How much do I pay for my Demat Account?

1. You can pay Rs. 650 as an account opening fee and enjoy many exclusive offers*.

Q. Whom should I contact in case of any queries?

1. You can call on our toll free no 18004198283 or write a mail at [email protected].

Q. What all documents are required to Open Demat Account?

1. To open a demat account, you need a mobile number linked to Aadhaar, active mobile number, PAN card, digital signature, cancelled personalized cheque.

Q. What if I already have a Demat account with another Depository Participant?

You can open a trading account with us and link it to your existing demat account. Alternately, you can open a new trading and demat account with us, transfer your securities and funds to the new account and close the older account.

Q. Things to check before Opening Demat Account

Before opening a demat account, one should always check the brokerage charges, annual maintenance charges, any other charges if applicable, technology and trading platforms and other supporting value-added features and customer services.

Q. Various Types of Demat Account

At Karvy, we offer customized solutions to meet every investor’s unique requirements. You can opt for only demat or only trading account, demat and trading account with access to trading equity, commodity, currencies, mutual funds and other exchange-traded securities.

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