Sensex Closes at Record High; Coal India & Yes Bank Top Gainers
Closing

Indian share markets settled at new closing highs for a third straight session today. At the closing bell, the BSE Sensex finished higher by 90 points. While, the NSE Nifty finished higher by 13 points. Meanwhile, the S&P BSE Midcap Index ended down by 0.4% while S&P BSE Small Cap Index ended up by 0.1% respectively.

Sectoral indices ended the day on a mixed note with realty stocks and consumer durables stocks leading the gainers. While, power stocks and healthcare stocks ended the day in red.

Overseas, Asian stock markets finished higher today with shares in Japan leading the region. The Nikkei 225 is up 0.57% while Hong Kong's Hang Seng is up 0.36% and China's Shanghai Composite is up 0.13%. European markets are higher today with shares in France leading the region. The CAC 40 is up 0.49% while London's FTSE 100 is up 0.31% and Germany's DAX is up 0.21%.

The rupee was trading at Rs 63.47 against the US$ in the afternoon session.

Coal India share price rallied over 5.6% in the opening trade on the reports that it has raised prices of thermal coal by an average 9%. The decision was taken at a board meeting held on Monday while revised prices would be effective from today. It will make power generation costlier by a similar percentage. Cost of cement and fertiliser production is also expected to rise as a result.

In another development, rating agency, CRISIL in its latest report has maintained its projection of India's economic growth in 2018-19 to 7.6% on the low base.

The rating agency attributed the continuing slowdown to the after-effects of the demonetisation exercise, the Goods and Services Tax (GST) implementation and weakness in agriculture.

The CRISIL note comes days after the Central Statistics Office (CSO) came out with its First Advance Estimates of National Income, 2017-18, in which it stated that Indian economy is expected to grow at a four-year low of 6.5% in the current fiscal year 2017-18, as against 7.1% in the fiscal year 2016-17.

The rating agency has stated that given the low base and the expected waning of the GST impacts going ahead, they retain their forecast of 7.6% real GDP growth in fiscal 2019, with private consumption leading the recovery.

Just Released: Multibagger Stocks Guide
(2018 Edition)

In this report, we reveal four proven strategies to picking multibagger stocks.

Well over a million copies of this report have already been claimed over the years.

Go ahead, grab your copy today. It's Free.

NO-SPAM PLEDGE - We will NEVER rent, sell, or give away your e-mail address to anyone for any reason. You can unsubscribe from The 5 Minute WrapUp with a few clicks. Please read our Privacy Policy & Terms Of Use.

It noted that private consumption is expected to grow 6.3% in FY18, as against 8.7% a year before, and will remain the largest contributor to the country's GDP at 55.7%.

Further, it said that in FY19 as well, growth will continue to be consumption-led as inflation will be under control and interest rates are expected to be soft. It also said that increase in government employees' salaries with the implementation of the seventh pay panel recommendations will also help. It added that the government's focus on spending towards agriculture and rural themes will also be of help.

According to the report, the government's ambitious Rs 2.11 trillion recapitalisation plan over two years will ensure that the state-run banks are well positioned to support the growth. It also observed that support to growth will also come from the external sector where the global recovery should help exports, which had faced some headwinds after the GST implementation.

In the news from the pharma sector. Orchid Pharma share price soared over 4.9% after it received the Establishment Inspection Report (EIR) from US Food and Drug Administration (USFDA).

Reportedly, USFDA successfully completed inspection for the Post-Marketing Adverse Drug Experience reporting inspection (PADE) conducted in Tamil Nadu, India.

The facility was inspected by USFDA in the month of June 2017.

One shall note that, as per the Indian Pharmaceutical Alliance, the pace of drug approvals has gained momentum after they complained to FDA about delays last year.

Approvals for drugs have also picked up after USFDA concerns at some of the manufacturing units were addressed. Companies such as Divi's Laboratories, Cadila Healthcare, Sun Pharmaceuticals and Dr Reddy's Laboratories got regulatory clearances for some of their plants during the year. But several companies are still grappling to resolve FDA concerns.

However, FDA's move to speed up generic drug approvals in a bid to reduce healthcare costs is likely to provide some earnings relief to domestic pharma companies.

After being adversely affected by import bans and the suspension of new drug approvals from manufacturing facilities in the past three years, there has been a sharp pick-up in new drug approvals in FY17.

Generic Drug Approvals Hit The Roof

With an aim to lower the overall healthcare costs in the country, USFDA approved a record 763 generic drugs for the financial year ending 30th September. As per Mint Analysis, Indian pharma companies received 295 approvals accounting for 40% of the overall approvals during the year.

Even the total filings of abbreviated new drug applications (ANDAs) for generic drugs rose to 1,292 in FY17 from 852 in FY16.

In such an environment, it makes sense for investors to be selective while buying stocks. Focus on value and the underlying fundamentals of the business. Then, they need not worry about the market.

So, what is key to identifying potential multibagger stocks? How does one pick them at the right time and ride them to their full potential? How many multibaggers do you really need to achieve the big riches that you desire?

Most importantly, are there any stocks right now that could turn out to be multibaggers? Click here to know everything that you need to know right now about mutlibagger stocks...

And here's a note from Profit Hunter:

Coal India is showing strong trading momentum. It rallied more than 15% for the past seven trading sessions to achieve a high of 311.

Last time, we mentioned that 240 is the strong support level for the stock. The level acted as support in August 2013 and February 2014. In August 2017, it bounced up from this level after forming an inverse head and shoulder pattern to touch a high of 295 in October 2017.

It corrected from this high to find support from the inverse head-and-shoulder pattern's neckline. The stock also formed a double bottom pattern near the neckline. Recently, it broke out of this pattern (red line), and it also broke above the falling trendline (blue line) as seen in the chart below.

Today, the stock opened gap up and rallied nearly 6% with healthy volumes to cross above its previous high of 295.

So can the stock maintain its strong momentum in the sessions to come? Let's wait and watch.

Coal India Rallied 6% for the Day
Coal India Rallied 6% for the Day 

Indian Share Markets Trade Flat; Tata Motors Gains on JLR Sales
01:30 pm

Indian share markets continue to trade marginally higher in the noon session. Gains are largely seen in realty stocks, FMCG stocks and metal stocks. Meanwhile, power stocks and capital goods' stocks are witnessing majority of the selling activity.

The BSE Sensex is trading higher by 45 points and the NSE Nifty is trading down by 2 points. Meanwhile, the BSE Mid Cap index is trading down by 0.4% & the BSE Small Cap index is down by 0.1%. The rupee is trading at 63.34 to the US$.

2017 was a surprising year to say the least. The S&P BSE Realty Index grew by a staggering 98% in CY 2017 alone, making it one of the best performing sectors on the Index. The government's focus on affordable housing and RERA (Real Estate Regulation Act) gave investors hope of a revival in the sector.

Best & Worst Performing Sectors - S&P BSE Index

Post Notebandi came GST. This was also supposed to hamper day to day operations of companies until the whole GST process was streamlined. Consumer durable stocks remained immune to the disruption and logged in a 99% growth. A healthy monsoon also helped boost investor sentiment in consumer durable stocks.

It is also important to note that the dual effects of Notebandi and GST did show on earnings.

Automobile stocks are trading on a mixed note with Ashok Leyland share price and Escorts Ltd share price leading the gains.

Tata motors share price is trading up by 1.1% on record Jaguar Land Rover global sales in 2017.

Just Released: Multibagger Stocks Guide
(2018 Edition)

In this report, we reveal four proven strategies to picking multibagger stocks.

Well over a million copies of this report have already been claimed over the years.

Go ahead, grab your copy today. It's Free.

NO-SPAM PLEDGE - We will NEVER rent, sell, or give away your e-mail address to anyone for any reason. You can unsubscribe from The 5 Minute WrapUp with a few clicks. Please read our Privacy Policy & Terms Of Use.

Jaguar Land Rover's sales rose 7% to a record 621,109 vehicles in 2017 but Britain's biggest carmaker said it faced tough conditions in its home market due to weakening consumer confidence and a planned diesel tax rise on new cars.

The company has embarked on a major turnaround plan since being bought by the Tata group in 2008. This includes investment in new models and expansion of production with the aim of building around 1 million vehicles a year by the turn of the decade.

It said growth in China, its largest market, and in the United States helped to offset difficult conditions in Britain and the rest of Europe, where the demand was flat.

As per the reports, over the next three months, a series of launches are scheduled for JLR, and this should drive strong volume growth.

Moving on to news from the economy. Attributing the continuing slowdown to the after-effects of the demonetisation exercise, the Goods and Services Tax (GST) implementation and weakness in agriculture, rating agency, CRISIL in its latest report has maintained its projection of India's economic growth in 2018-19 to 7.6% on the low base.

The CRISIL note comes days after the Central Statistics Office (CSO) came out with its First Advance Estimates of National Income, 2017-18, in which it stated that Indian economy is expected to grow at a four-year low of 6.5% in the current fiscal year 2017-18, as against 7.1% in the fiscal year 2016-17.

Adding further, it said that in FY19 as well, growth will continue to be consumption-led as inflation will be under control and interest rates are expected to be soft. It also said that increase in government employees' salaries with the implementation of the seventh pay panel recommendations will also help. It added that the government's focus on spending towards agriculture and rural themes will also be of help.

According to the report, the government's ambitious Rs 2.11 trillion recapitalisation plan over two years will ensure that the state-run banks are well positioned to support the growth.


Indian Indices Trade Marginally Higher; Realty Sector Up 1.9%
11:30 am

Stock markets in India are presently trading marginally higher. Sectoral indices are trading on a mixed note with stocks in the realty sector and energy sector witnessing maximum buying interest.

The BSE Sensex is trading up 93 points (up 0.3%) and the NSE Nifty is trading up 11 points (up 0.1%). The BSE Mid Cap index is trading flat, while the BSE Small Cap index is trading up by 0.4%. The rupee is trading at 63.46 to the US dollar.

In the news from the pharma space, Aarti Drugs share price is witnessing buying interest today. The stock of the company scaled its fresh 52-week high after the company informed bourses that it has fixed January 19 as record date for the purpose of buyback of upto 2.75 lakh shares representing upto 1.15% stake at Rs 875 per share.

Presently the stock of the company is trading up by around 5%.

Speaking of share buybacks, many buybacks are set to hit a new record this financial year. As per Prime Database, in the first five months of FY18, at least twenty companies have offered to buy back shares worth Rs 480 billion.

Also, in the past two years, the quantum of share buybacks has far exceeded the amount of new equity capital raised from IPOs.

As per Rahul Shah, co-head of Research, investors should not assume buybacks are always good. Here's an excerpt of what he wrote in a recent edition of The 5 Minute Wrapup:

  • The reason behind the buyback must be investigated. At the end of the day, an increase in earnings should be more a function of the inherent robustness of the business, as that's what will help it continue to grow at a healthy pace.

Just Released: Multibagger Stocks Guide
(2018 Edition)

In this report, we reveal four proven strategies to picking multibagger stocks.

Well over a million copies of this report have already been claimed over the years.

Go ahead, grab your copy today. It's Free.

NO-SPAM PLEDGE - We will NEVER rent, sell, or give away your e-mail address to anyone for any reason. You can unsubscribe from The 5 Minute WrapUp with a few clicks. Please read our Privacy Policy & Terms Of Use.

The topic also brings us to ask: Do buy-backs offer an arbitrage opportunity for retail investors? Ankit Shah has answered this question in a recent edition of Equitymaster Insider. You can access the issue here.

In the news from the IPO space, Apollo Micro Systems is going to launch its IPO tomorrow. The offer will be open from 10th January till 12th January and the company intends to raise Rs 1.5 billion from its public offering.

The price band of the IPO is finalised at Rs 270 to Rs 275 per share.

Apollo Micro Systems Ltd is Hyderabad based company engaged in the business of electronic, electro-mechanical, engineering designs, manufacturing and supply. The company designs, develops and sells high-performance, mission and time critical solutions to Defense, Space and Home Land Security for Ministry of Defense, government controlled public sector undertakings and private sectors.

The company offers custom built COTS (commercially off-the shelf) solutions based on specific requirements to defense and space customers.

We are tracking this IPO and will shortly release our analysis on the company. Stay tuned.

Speaking of IPOs, the demand for IPO's has reached sky-high levels. Avenue Supermarts was seen as the first company last year to cross the 100-time subscription mark swiftly followed by CDSL and Dixon technologies, among others.

IPO Subscription Times (2017)


This euphoria is something similar to what was seen in 2007-08. When everyone around you is clamoring to get a piece of the IPO pie, it makes sitting tight difficult. And, why should you sit tight when stocks like Avenue Supermart lets you pocket a cool 100% gain from day 1 of the listing?

History suggests that these cases are few and far between. More than 70% of the IPOs listed in 2007 and 2008 are in the red, even today when the Sensex is at an all-time high.

A merit-based selection primarily including valuation, business, and management quality is the logical way to go about investing in IPOs. If it means going against the herd, so be it. And going by recent past, this strategy has been proven to be successful more often than not.

To know more, you can download our FREE report - How to Get Rich with IPOs. This guide will show you how to safely profit from the ongoing IPO rush.


Sensex Opens Higher; Coal India Rallies
09:30 am

Asian stock markets are higher today as Chinese and Hong Kong shares show gains. The Shanghai Composite is up 0.15% while the Hang Seng is up 0.23%. The Nikkei 225 is trading up by 0.54%. US stocks closed mixed as investors turned cautious ahead of earnings.

Back home, India share markets opened the day on a positive note. The BSE Sensex is trading higher by 88 points while the NSE Nifty is trading higher by 29 points. The BSE Mid Cap index and BSE Small Cap index both opened the day up by 0.2%.

All sectoral indices have opened the day in green with metal stocks and realty stocks witnessing maximum buying interest. The rupee is trading at 63.35 to the US$.

Coal India share price rallied over 4.7% in the opening trade on the reports that it has raised prices of thermal coal by an average 9%. The decision was taken at a board meeting held on Monday while revised prices would be effective from today. It will make power generation costlier by a similar percentage. Cost of cement and fertiliser production is also expected to rise as a result.

Automobile stocks have opened the day on a mixed note with Ashok Leyland and Maharashtra Scooters being the most active stocks in this space. Tata Motors announced that despite tough conditions in some markets, Jaguar Land Rover achieved record global sales in 2017 with retails of 621,109 vehicles, up 6.5% on the prior year.

Retail sales for the month of December were 55,697, up 0.6% and for the quarter were 154,447 vehicles, up 3.5%.

Further, retail sales in December were up in Overseas markets (19%) and in China (12.6%) but down in the UK (15.8%), US (9.2%) and Europe (4.6%), reflecting weaker market conditions in the UK and to a lesser extent the US.

Jaguar retail sales were 15,079 vehicles in December, down 7.8% compared to December 2016 as solid sales of the long wheel base Jaguar XFL in China and the introduction of the E-PACE were more than offset by softer sales of XE and XJ.

Just Released: Multibagger Stocks Guide
(2018 Edition)

In this report, we reveal four proven strategies to picking multibagger stocks.

Well over a million copies of this report have already been claimed over the years.

Go ahead, grab your copy today. It's Free.

NO-SPAM PLEDGE - We will NEVER rent, sell, or give away your e-mail address to anyone for any reason. You can unsubscribe from The 5 Minute WrapUp with a few clicks. Please read our Privacy Policy & Terms Of Use.

Land Rover retailed 40,618 vehicles in December 2017, up 4.1% compared to December 2016, led by the introduction of the Range Rover Velar and the sales ramp up of the all new Discovery.

Going forward, the company expects going to get tough in UK due to weak consumer confidence and diesel tax.

Tata Motors share price opened the day up by 0.4%.

In another development, the government has announced a stake sale in NMDC through the Offer for Sale (OFS) route.

The government plans to sell 47.4 million shares in the company via OFS over 9-10 January 2018.

The floor price for the OFS is Rs 153.5, a 5.4% discount to yesterday's closing price. The OFS would raise Rs 7280 million for the government assuming that the allocation price is the same as the floor price.

A minimum of 25% is reserved for institutional investors (Mutual Funds and Insurance companies) and 20% is reserved for retail investors. Retail investors would also receive a 5% discount to their allocation price. The offer for Non-retail investors would be open today and for retail investors the OFS would be open on 10 January.

The Centre currently owns 74.9% in the country's largest iron ore producer.

One shall note that, the government has already raised Rs 538.3 billion through disinvestment in public sector firms this fiscal by listing public sector insurers and exchange traded fund.

For the current fiscal year, it has set a target of raising Rs 725 billion via disinvestment, which includes Rs 465 billion through minority stake sales, Rs 150 billion from strategic sale and another Rs 110 billion from listing of insurance firms.

Higher Revenue from Disinvestment?


As per an article in Business Standard, the department of investment and public asset management (DIPAM) is looking to not only to achieve FY18 target, but also aiming to take disinvestment proceeds beyond Rs 900 billion. With this, any shortfall from other revenue items, including GST could be made up by disinvestment.

This optimism is mainly due mega deal of ONGC acquiring HPCL, which could get the exchequer Rs 300 billion. Similarly, there are a number of IPOs lined up which includes the likes of Ircon, Hindustan Aeronautics, Bharat Dynamics, and Mazgaon Dockyards. DIPAM is also working on OFS proposals which includes Indian Oil, Oil India, NHPC, and REC.

Not to mention, extra dividend from the PSUs in addition to disinvestment. With this, the slippage of the deficit could pretty much be negligible, provided there is no major gap in terms of GST collections. It will be interesting to see how the government approaches disinvestment in the coming months.

NMDC opened the day down by 3.5%.


Strong Global Markets; Sensex at Record High; Tata Power, L&T among Top Stocks to Sway Markets Today
Pre-Open

Indian share markets settled at record closing highs on Monday, as pre-budget cheer and optimism over corporate results offset lowered growth forecasts, with sentiment also boosted by broader Asian markets that advanced towards historic levels.

Among BSE sectoral indices, IT index gained the most by 1.5%, followed by healthcare 1.3%, capital goods 1.3% and metal 0.9%.

Meanwhile, the rupee erased all the morning gains and was trading little changed against the US dollar on Monday. The rupee was trading at 63.39 a dollar, up 0.01% from its Friday's close of 63.37.

Top Stocks in Focus

Larsen & Toubro (L&T)'s its construction arm has won orders worth Rs 22.7 billion from Andhra Pradesh Capital Region Development Authority. The stock will be in focus.

Tata Power share price will hog limelight after it was reported that it has set up additional electric vehicle charging stations at strategic locations thereby making Mumbai truly ready to usher in the Electric Vehicle wave.

Dry cell batteries major Eveready Industries India Limited (EIIL) announced that it is entering the confectionery business as part of its diversification plan.

Siemens share price will remain in focus on the reports that it is going to implement electrification of Gujarat Metro Link Express. The Indian mass-transit operator Metro Link Express for Gandhinagar and Ahmedabad (MEGA) Company Limited has awarded an order of approximately Rs 5.8 billion to the consortium of Siemens Limited India and Siemens AG, Germany for electrification of the 39.2-kilometer Metro Express Link in Ahmedabad.

Orchid Pharma has received the Establishment Inspection Report (EIR) from US Food and Drug Administration (USFDA) based on the successful inspection closure for the Post-Marketing Adverse Drug Experience reporting inspection (PADE). The facility was inspected by USFDA in the month of June 2017.

Unichem Laboratories will be in focus after it received approval for buyback for purchase up to 20.6 million equity shares. The company will buy back shares at a price of Rs 430 per share, for an aggregate amount up to Rs 8.9 billion.

Vakrangee (VL) has tied-up with Netmeds Marketplace to offer medicines and other health products from Vakrangee Kendra. Netmeds is an online marketplace for pharmaceutical and similar goods including OTC Products.

Just Released: Multibagger Stocks Guide
(2018 Edition)

In this report, we reveal four proven strategies to picking multibagger stocks.

Well over a million copies of this report have already been claimed over the years.

Go ahead, grab your copy today. It's Free.

NO-SPAM PLEDGE - We will NEVER rent, sell, or give away your e-mail address to anyone for any reason. You can unsubscribe from The 5 Minute WrapUp with a few clicks. Please read our Privacy Policy & Terms Of Use.

Global Stock Market Drivers

Asian shares crept toward all-time peaks on Monday after Wall Street boasted its best start to a year in over a decade, with brisk economic growth and benign inflation proving a potent cocktail for risk appetite.

Meanwhile, European shares hit their highest level in more than two years in early trading on Monday as confidence over global growth continued to boost investor appetite for global stocks.

Here are some of the other main events to watch for this week:

  • As per Bloomberg, US inflation data will probably show price pressures remain muted, giving hawks little reason to argue for faster tightening.
  • San Francisco Fed President John Williams and head of the New York Fed Bill Dudley are among policy makers scheduled to speak.

    China producer and consumer prices data are due Wednesday, while a reading on the country's money supply is expected in coming days.

    US firms announcing earnings this week include JPMorgan Chase & Co., Wells Fargo & Co. and BlackRock Inc.

IPO Buzz

New Delhi-headquartered Newgen Software Technologies is reportedly gearing up to launch an initial public offering (IPO) later this month.

Through the move, the IT company is aiming to raise a total of US$71 Million (Rs 4.5 billion). Newgen Software is looking to dilute around 25%-26% stake, of which 21% will be from private equity investors. The rest will be sold by the company's existing employees, the reports noted.

Speaking of IPOs, the demand for IPO's had reached sky-high levels last year.

One shall note that, more than 70% of the IPOs listed in 2007 and 2008 are in the red, even today when the Sensex is at an all-time high.

A merit-based selection primarily including valuation, business, and management quality is the logical way to go about investing in IPOs. If it means going against the herd, so be it. And going by recent past, this strategy has been proven to be successful more often than not.

To know more, download this FREE report now and discover How to Get Rich with IPOs. This guide will show you how to safely profit from the 2017 IPO rush.

Bulk & Block Deals

Federal Bank share price will be in focus after a large bulk deal of 4.8 million shares was executed on the scrip at Rs 114.75 per share on BSE yesterday.

Our team of Equitymaster analysts have been working on a project to track the smartest minds in value investing. They have compiled a special report on them, called The Superinvestors of India.

Now, because of insights from these interactions, the team has glued their eyes on insider activity and bulk and block deals...

As per them...

Crude oil Stable on Lower US Rig Count

Oil prices were stable on Monday, supported by a slight decline in the number of US rigs drilling for new production, with crude holding just below near three-year highs reached last week.

US West Texas Intermediate (WTI) crude futures were at US$61.5 a barrel, 6 cents above their last settlement. Futures reached US$62.2 last week, the most since May 2015. Brent crude futures were at US$67.66 a barrel, 4 cents above their last close. Brent hit US$68.27 high last week, the highest since May 2015.

To keep a tab on the movements in crude oil and other commodities, you can read the stock market commentary from the Daily Profit Hunter team. Their commentary tracks the developments in the global economy as well as stock, currency and commodity markets.