The Nifty has a strong support at 11,295-11,235 for the coming week, while its resistance is placed at 11,450
The market reversed Thursday’s losses, with the Nifty managing to reclaim the 11,350 mark. Both Sensex and Nifty managed to post their biggest one-day gain in more than a month.
The Sensex rose 391 points to end above 37,500, led by financial sector stocks, which contributed over 50 percent to the Nifty’s gains as well. HDFC, ICICI Bank were top gainers, while Kotak Mahindra Bank was up 2 percent on a Rs 500 crore share issuance.
Among midcaps, Bharat Forge and Ramkrishna Forgings hit all-time highs due to class-8 truck sales.
What’s in store?
August 4, 2018: Thyrocare’s board of directors will meet to consider buyback. A couple of days later, on August 6, HDFC Asset Management Company will be listing on the exchanges. On the same day, Adani Ports will also declare its quarterly numbers. On Saturday, the boards of Gateway Distriparks, JBM Auto and Omaxe will meet to discuss fund raising plans, while the board of Punjab National Bank will meet to consider a capital infusion of Rs 2,816 crore by the government through a preferential allotment of shares.
August 7, 2018: Mahindra & Mahindra will announce its June quarter numbers, while Trident, Shree Pushkar Chemicals and Prism Johnson will have board meets to consider fund raising.
August 8, 2018: Cipla, Lupin, BPCL and HPCL will declare their results while Sadbhav Infra and RCF will have board meets to consider fund raising on the same day.
August 9, 2018: Eicher Motors will declare results while US and Japan will hold their first bilateral trade talks.
August 10, 2018: Hindalco, SBI and GAIL will declare their respective numbers, while the government will also announce IIP data for June.
The Nifty has a strong support for 11,295-11,235 for coming week while the hurdle is at the 11,450 mark.
Century Enka
The company was incorporated in 1965. It manufactures synthetic yarn Nylon Tyre Cord Fabric (NTCF) that find its application in the making of bias tyres, and, Nylon Filament Yarn (NFY), which finds its application in making of sarees, dupattas, dress materials and athleisure among others.
Plans are afoot to use its existing fabric capacities and dipping facilities to offer Polyester Tyre Cord Fabric (PTCF), which will find its application as a reinforcement material in radial passenger vehicle tyres.
The company’s manufacturing facilities at Rajashree Nagar, Bharuch (Gujarat) and Bhosari, Pune (Maharashtra) are equipped with state-of-the-art manufacturing technology. It has a strong presence in both NTCF and NFY products.
The company has 31,000 TPA manufacturing capacities of Nylon Tyre Cord Fabric (NTCF). This segment contributes 60 percent of its revenue. The company has a 24 percent domestic market share in the NTCF segment.
In the Nylon Filament Yarn (NFY) segment company has 36,000 TPA manufacturing capacity. This segment contributes 40 percent of its revenue. The company enjoys a 19 percent domestic market share in the NFY segment.
In FY18, Century Enka posted PAT of Rs 70.09 crore on sales of Rs 1447.77 crore, fetching an EPS of Rs.32.08. The company has posted highly impressive numbers for Q1FY19.
For the June quarter, the company reported a 10.06 percent jump in sales to Rs 405.87 crore, while its net profit soared 268.03 percent on year to Rs 22.45 crore, fetching an EPS of Rs 10.27. PAT also increased 30.59 percent QoQ. We are recommending a BUY.
Adani Power
Adani Power is the largest private sector thermal power producer of India with a total power generation capacity of 10,440 MW thermal power and 40MW of solar power. It is the world’s first company to set up a coal-based super critical thermal power project registered under Clean Development Mechanism (CDM) of Kyoto protocol.
During FY18 Adani Power was also able to secure long term Fuel Supply Agreements for domestic coal supply under the Scheme for Harnessing and Allocating Koyala (Coal) Transparently in India (SHAKTI) policy for the power plants at Tiroda (Maharashtra) and Kawai (Rajasthan), which gives visibility of steady revenues in the future.
This lower and reliable cost fuel supply will enable both these power plants to reduce fuel costs and have a material impact in improving cash flows as well as profitability. We are recommending it.
L&T Finance
L&T Finance has a clear strategy of achieving top quartile RoE through the three pronged strategy of Right Businesses, Right Structure and Right People remains relevant and robust even after two years.
Excellent growth in focused businesses, excellent fee income stream, strict cost control and improvement in asset quality with accelerated provisioning is leading to an excellent and sustainable trajectory of RoE improvement.
L&T Finance will continue to improve its competitive position in each of its businesses, further simplify its systems, processes & structures and continue to attract, nurture and retain the right talent to implement this roadmap. Its future will continue to be guided by these simple percepts.
L&T Finance is in for the long haul. It’s massive investments in a strong digital and data analytics roadmap capturing every aspect of the customer journey are targeted to help it achieve seamless customer on-boarding, efficiency and productivity gains.
Data intelligence will be used to unlock every part of RoE tree. L&T Finance is committed to build a Company which delivers sustainable RoE for years, through a culture of “Results” not “Reasons”. Q1FY19 results aloud same thing.
Its NII is up by 51.2 percent on a YoY basis which is supported by 71.3 percent rise in the bottomline. Gross NPA is down by 14.5 percent while Net NPAs are down by 34 percent. It’s provision coverage ratio stood at 62 percent vs 43.4 percent
