Market View 4th October 2023

View on market: Volatility Prevails, Market is searching for better value

Asian shares slumped, tracking U.S. peers lower after employment data bolstered the case for the Federal Reserve to keep interest rates elevated and pushed up Treasury yields. Stocks declined more than 1% at the open in Japan and South Korea and slipped in Australia. A regional benchmark headed for a technical correction. Futures for benchmark in Hong Kong pointed to losses, while those for the U.S. were little changed. The S&P 500 fell to a four-month low Tuesday and yields on Tuesday. The Nasdaq 100 fell 1.8%. Meanwhile, Brent Crude prices were trading above $91 a barrel, and WTI Crude was above $89-mark. The yield on the 10-year U.S. bond was trading at 4.80% and Bitcoin was above 27,000-level. At 6:06 a.m., the GIFT Nifty, an early indicator of the Nifty 50 Index’s performance in India was down 98 points or 0.50% at 19,453.5. India’s benchmark stock indices closed lower on Tuesday, dragged by losses in index heavyweights HDFC Bank Ltd. and Reliance Industries Ltd. Auto, oil and gas, and pharma sectors declined, while public sector banks and media advanced. Overseas investors remained net sellers of Indian equities for the tenth consecutive day. While foreign portfolio investors sold stocks worth Rs 2,034.1 crore, domestic institutional investors mopped up stocks worth Rs 1,361 crore, according to provisional data from the NSE. The Indian rupee weakened 17 paise to close at Rs 83.21 against the U.S. dollar on Tuesday.

Economic Calendar:

• USD: ADP Nonfarm Employment Change (Sep) on 04^th October, 2023
• USD: ADP Nonfarm Employment Change (Sep) on 04^th October, 2023
• INR: Nikkei Services PMI (Sep) on 05^th October, 2023
• INR: Nikkei Services PMI (Sep) on 05^th October, 2023

Brokerage Radar:

HSBC on Alkem Labs: Hold, TP Rs 3910 Expect 2Q to be a low qtr in view of slow pick-up for acute therapies(mainly anti-infectives) Biz execution record of its recently hired CEO should help reboot India growth strategy Strong vol pick-up in India segment a key catalyst.

MS on OMCS: Counter consensus +ve view based on refining upcycle, better capital allocation & underappreciated earnings quality improvement due to underlying policy reforms See strong outperformance with multiple catalysts ahead. Key OWs – BPCL/ IOCL

Macquarie on Avenue Supermart: O-P, TP Rs 4550 Broadly in-line store additions and sales growth Four-year sales CAGR rises marginally from 1Q levels Believe this marginal uptick in sales momentum was led by a gradual recovery in the high-margin apparel segment

International Markets

 U.S & Europe:

Asian markets:

ADR Watch:

Commodities & Currency:

FIIs & DIIs:

News Update:

HDFC Bank: The bank sent out a detailed memo to its employees detailing management changes. IT and tech have been brought under the CEO’s purview. Ashish Parthasarthy will handle branch business, while Arvind Kapil will manage mortgages and retail businesses.

Maruti Suzuki: The carmaker received a draft assessment order from the Income Tax Authority amounting to Rs 2,160 crore for FY 2019–20. The company will file objections before the Dispute Resolution Panel. Further, it reported total output for September at 1.74 lakh units, down 1.4% year-on-year.

Bajaj Finserv: Unit Bajaj Allainz General Insurance received a Rs 1,010 crore-show cause cum demand notice from GST authorities for alleged non-payment of GST on co-insurance and re-insurance premiums.

Pidilite Industries: Unit Pidilite MEA Chemicals and Spain-based Corporacion Empresarial Grupo Puma SL incorporated a 50:50 joint venture company in the UAE for the manufacturing of construction chemicals.

Nestle India: The board will meet on Oct. 19 to mull the stock split of shares and the second interim dividend for the year 2023.

Source: Moneycontrol, Bloomberg Quint, Investing 

Disclosure in pursuance of Section 19 of SEBI (RA) Regulation 2014

Elite Wealth Limited does/does not do business with companies covered in its research reports. Investors should be aware that the Elite Wealth Limited may/may not have a conflict of interest that could affect the objectivity of this report. Investors should consider this report as only information in making their investment decision and must exercise their own judgment before making any investment decision.

For analyst certification and other important disclosures, see the Disclosure Appendix, or go to www.elitewealth.in. Analysts employed by Elite Wealth Limited are registered/qualified as research analysts with SEBI in India.( SEBI Registration No.: INH100002300)

Disclosure Appendix

Analyst Certification (For Reports)

Kiran Tahlani, Elite Wealth Limited, kirantahlani@elitestock.com

The analyst(s) certify that all of the views expressed in this report accurately reflect my/our personal views about the subject company or companies and its or their securities. I/We also certify that no part of my compensation was, is or will be, directly or indirectly, related to the specific recommendations or views expressed in this report. Unless otherwise stated, the individuals listed on the cover page of this report are analysts in Elite Wealth Limited.

As to each individual report referenced herein, the primary research analyst(s) named within the report individually certify, with respect to each security or issuer that the analyst covered in the report, that:

(1) all of the views expressed in the report accurately reflect his or her personal views about any and all of the subject securities or issuers; and

(2) no part of any of the research analyst’s compensation was, is, or will be directly or indirectly related to the specific recommendations or views expressed in the report.

For individual analyst certifications, please refer to the disclosure section at the end of the attached individual notes.

Research Excerpts

This note may include excerpts from previously published research. For access to the full reports, including analyst certification and important disclosures, investment thesis, valuation methodology, and risks to rating and price targets, please visit www.elitewealth.in.

Company-Specific Disclosures

Important disclosures, including price charts, are available and all Elite Wealth Limited covered companies by visiting https://www.elitewealth.in, or e-mailing research@elitestock.com with your request. Elite Wealth Limited may screen companies based on Strategy, Technical, and Quantitative Research. For important disclosures for these companies, please e-mail research@elitestock.com.

Options related research:

If the information contained herein regards options related research, such information is available only to persons who have received the proper option risk disclosure documents. For a copy of the risk disclosure documents, please contact your Broker’s Representative or visit the OCC’s website at https://www.elitewealth.in

Other Disclosures

All research reports made available to clients are simultaneously available on our client websites. Not all research content is redistributed, e-mailed or made available to third-party aggregators. For all research reports available on a particular stock, please contact your respective broker’s sales person.

Ownership and material conflicts of interest Disclosure

Elite Wealth Limited policy prohibits its analysts, professionals reporting to analysts from owning securities of any company in the analyst’s area of coverage. Analyst compensation: Analysts are salary based permanent employees of Elite Wealth Limited. Analyst as officer or director: Elite Wealth Limited policy prohibits its analysts, persons reporting to analysts from serving as an officer, director, board member or employee of any company in the analyst’s area of coverage.

Country Specific Disclosures

India – For private circulation only, not for sale.

Legal Entities Disclosures

Mr. Ravinder Parkash Seth is the Managing Director of Elite Wealth  Ltd (EWL, henceforth), having its registered office at Casa Picasso, Golf Course Extension, Near Rajesh Pilot Chowk, Radha Swami, Sector-61, Gurgaon-122001 Haryana, is a SEBI registered Research Analyst and is regulated by Securities and Exchange Board of India. Telephone: 011-43035555, Facsimile: 011-22795783 and Website: www.elitewealth.in

EWL discloses all material information about itself including its business activity, disciplinary history, the terms and conditions on which it offers research report, details of associates and such other information as is necessary to take an investment decision, including the following:

1. Reports
2. a) EWL or his associate or his relative has no financial interest in the subject company and the nature of such financial interest;

(b) EWL or its associates or relatives, have no actual/beneficial ownership of one per cent. or more in the securities of the subject company, at the end of the month immediately preceding the date of publication of the research report or date of the public appearance;

(c) EWL or its associate or his relative, has no other material conflict of interest at the time of publication of the research report or at the time of public appearance;

2. Compensation

(a) EWL or its associates have not received any compensation from the subject company in the past twelve months;

(b) EWL or its associates have not managed or co-managed public offering of securities for the subject company in the past twelve months;

(c) EWL or its associates have not received any compensation for investment banking or merchant banking or brokerage services from the subject company in the past twelve months;

(d) EWL  or its associates have not received any compensation for products or services other than investment banking or merchant banking or brokerage services from the subject company in the past twelve months;

(e) EWL or its associates have not received any compensation or other benefits from the subject company or third party in connection with the research report.

3 In respect of Public Appearances
(a) EWL or its associates have not received any compensation from the subject company in the past twelve months;
(b) The subject company is not now or never a client during twelve months preceding the date of distribution of the research report and the types of services provided by EWL

Provided that research analyst or research entity shall not be required to make a disclosure as per sub-clauses (c), (d) and (e) of clause (ii) or sub-clauses (a) and (b) of clause (iii) to the extent such disclosure would reveal material non-public information regarding specific potential future investment banking or merchant banking or brokerage services transactions of the subject company.
(4) EWL or its proprietor has never served as an officer, director or employee of the subject company;
(5) EWL has never been engaged in market making activity for the subject company;
(6) EWL shall provide all other disclosures in research report and public appearance as specified by the Board under any other regulations