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Religare Morning Digest
September 22, 2017
Nifty Outlook
VWAP (Expiry till date) Max OI (Call) Max OI (Put)
NIFTY 10000 10200 9900
Markets settled marginally lower in a volatile trading session today, extending its consolidation phase. Sentiment was somber from the beginning, taking cues from the US Fed meet, wherein it signaled one more hike this year. Besides, weakness in rupee against the dollar further added to the pressure. Mostly sectoral indices traded in line with the benchmark and ended lower.
Markets are showing resilience amid mixed signals and it indicates that participants are expecting higher levels ahead. However, we feel trading in such a volatile environment is task in itself. The challenge is to stay with trend without comprising much on the profit potential. Thus we suggest keeping hedged positions and avoid over trading.
Sectors to watch
Sector Name Outlook
AUTO STABLE
ENERGY STABLE
REALTY WEAK
News
Religare Super Ideas**
FII & DII Cash Segment (Rs. in Cr.) Trade Stats
Category Amt. MTD FYTD
FII -1185 -10627 -35995
DII 946 7421 48468
NO OF CON-
TRACTS
TURNOVER IN CR
IDXFUTS 220323 18713
IDXOPT 11149447 1035713
STKFUTS 797153 58284
Derivative Ideas **
Dr Reddy's Laboratories surged 7.5% on news that the company has received establishment inspection report (EIR) from the US health regulator for its formulation manufacturing unit at Srikakulam plant in Andhra Pradesh. The company also stated that it has received zero observations for its custom pharmaceutical services facility, technology development centre, at Miyapur in Hyderabad after audit of the facility by the USFDA.
Orchid Pharma ended higher by 20% after the company said that it has received the Establishment Inspection Report from USFDA for active pharmaceutical ingredients manufacturing facility in Tamil Nadu.
Claris Lifesciences announced that the company has completed the sale of its remaining 20% stake in Otsuka Pharmaceuticals (a JV with Otsuka Pharmaceutical Factory, Inc and Mitsui & Co) to Otsuka Pharmaceutical Factory, Inc (Japan) for a consideration of USD 20mn.
*FII & DII data as on 20th September 2017
Scrip Buy/Sell CMP Initiation
Range SL* Target
VGUARD BUY 199.65 194-196 188 210
UNIONBANK SELL FUTS
136.05 137-138 141 130
**Please note that the given technical and derivative recommendations are
"valid for taking position" only on recommended date and in the given range.
*Please note - Stoploss is on closing basis for delivery recommendation and intraday basis for futures recommendation.
Instrument B/S Lot INITIATION
RANGE SL
TAR-GET
HDFC
BUY
1800
CE
500 6.90-7.00 3 15.50
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Religare Morning Digest
September 22, 2017
Religare Super Ideas
Investment Pick - Tata Communications
TCOM is targeting new growth avenues like cyber security, IOT and cross border security. It has reclassified its growth portfolio to include UCC and conferencing
solutions in the growth basket. It is focusing on the right capital allocation for future growth plans. TCOM has monetised two of its low ROCE businesses in FY17 (Neotel and Data Centre). It has sold off entire stake in Neotel (67%) and reduced its stake in Data Centre from 74% to 26%.
The initiatives taken by the management like monetizing poor performing ventures, deleveraging, prudent capital allocation and focus on high margin businesses
would lead to better operational margins in FY19-20E. We recommend a Buy on the stock with a target price of Rs. 822.
Scrip CMP Target Duration Recommendation Price
TATACOMM 703.55 822 9-12 Months 708
HDFC added around 1% in open interest as fresh
long positions with some delivery based buying in
previous session. Current chart pattern too indicate
fresh surge in price. We suggest buying HDFC Sep-
tember call options as per levels mentioned below.
Strategy: Buy HDFC SEP 1800CE BETWEEN 6.90-7,
SL-3, TGT-15.50
Derivative Ideas
V-Guard Industries Limited (VGUARD) Union Bank of India (UNIONBANK)
VGUARD has been consolidating while holding
firmly above its support zone of short term moving
averages on daily chart. Considering its chart
pattern, we expect a strong surge in near future.
Traders can accumulate fresh longs in the given
range.
Though UNIONABNK has witnessed a marginal
recovery from its support area but failed to cross the
resistance zone of multiple moving averages on daily
chart, resulting in formation of fresh shorting pivot.
We suggest using this bounce to go short as per the
levels.
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Religare Morning Digest
September 22, 2017
Religare Investment Calls
Name of the Company Reco Date Reco Price Target Price Upside % Previous day Closing Price
Cigniti Technologies Ltd. 5-Oct-16 419 538 28.3% 243.7
Fiem Industries 26-Dec-16 1,089 1,315 20.8% 923.9
Greenply Industries 3-Feb-17 268 304 13.4% 271.3
Arman Financial Services 22-Feb-17 226 340 50.0% 228.0
Indo Count Industries Ltd. 17-May-17 198 240 21.2% 116.1
SML Isuzu 25-May-17 1,247 1,525 22.3% 926.2
APL Apollo Tubes 12-July-17 1,596 2,352 47.4% 1,789.7
Force Motors 27-July-17 4,104 4,897 19.3% 3,961.0
Zee Entertainment Enterprises 28-July-17 539 592 9.8% 535.6
CRISIL 01-Aug-17 1,858 2,419 30.2% 1,849.7
LIC Housing Finance 09-Aug-17 681 748 9.8% 660.8
Eicher Motors Ltd 09-Aug-17 31,630 40,467 27.9% 31,824.3
Wonderla Holidays 17-Aug-17 339 430 26.8% 357.1
The Byke Hospitality 17-Aug-17 195 242 24.1% 174.2
Century Plyboards 18-Aug-17 251 307 22.3% 247.4
NRB Bearings 18-Aug-17 118 139 17.8% 122.7
Srikalahasthi Pipes Ltd 18-Aug-17 362 416 14.8% 331.4
Avanti Feeds 21-Aug-17 1,921 2,240 16.6% 2,111.6
Jain Irrigation Systems Ltd. 23-Aug-17 93 125 34.4% 104.7
Mold-Tek Packaging Limited 31-Aug-17 301 340 13.0 % 282.2
Swaraj Engines Ltd 31-Aug-17 1,985 2,201 10.9% 2,030.4
Mayur Uniquoters Ltd 01-Sept-17 360 460 27.7% 375.8
Castrol India 01-Sept-17 389 426 9.6% 380.3
Symphony Ltd 07-Sept-17 1,297 1,632 25.8% 1,415.0
Garware Wall Ropes Ltd 12-Sept-17 920 1,083 17.7% 872.1
Talwalkars Better Value Fitness 18-Sept-17 288 346 20.0% 283.0
Tata Communications 18-Sept-17 708 822 16.1% 703.6
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Religare Morning Digest
September 22, 2017
Corporate Action Calendar — September 2017 (Cash Dividend)
Sun Mon Tue Wed Thu Fri Sat
17 18
SE Investments Ltd
Gallantt Ispat Ltd
Phoenix Mills Ltd/The
PIX Transmissions Ltd
Arrow Textiles Ltd
Bliss Gvs Pharma Ltd
Ruby Mills Ltd
Shakti Pumps India Ltd
Aarti Industries
Technofab Engineering
Polyspin Exports Ltd
HBL Power Systems Ltd
Fluidomat Ltd
Sun Pharmaceutical
Bhandari Hosiery Exports
Indraprastha Gas Ltd
Sreeleathers Ltd
Inter Globe Finance Ltd
Signet Industries Ltd/India
Basant Agro Tech India Ltd
Windsor Machines Ltd
Vama Industries Ltd
Grauer & Weil India Ltd
Setco Automotive Ltd
LEEL Electricals Ltd
Alankit Ltd
High Ground Enterprise
Alicon Castalloy Ltd
Jay Ushin Ltd
19
Vimta Labs Ltd
Zee Learn Ltd
Shemaroo Entertainment
Srikalahasthi Pipes Ltd
Pondy Oxides & Chemicals
TD Power Systems Ltd
Precision Camshafts Ltd
HPL Electric & Power Ltd
Precision Camshafts Ltd
Bambino Agro Industries
Shivalik Bimetal Controls
Sunteck Realty Ltd
Patel Integrated Logistics
63 Moons Technologies Ltd
DLF Ltd
Oriental Veneer Products
Multiplus Holdings Ltd
Hindustan Tin Works Ltd
Marksans Pharma Ltd
Premier Polyfilm Ltd
Jindal Worldwide Ltd
BDH Industries Ltd
Zen Technologies Ltd
Prestige Estates Projects
Tokyo Plast International
Man Industries India Ltd
Seya Industries Ltd
Sahyog Multibase Ltd
National Fertilizers Ltd
Kanchi Karpooram Ltd
20
BASF India Ltd
Poly Medicure Ltd
Granules India Ltd
Glenmark Pharmaceuticals
Hinduja Ventures Ltd
Gujarat State Petronet Ltd
Arman Financial Services
Pearl Global Industries Ltd
Poddar Pigments Ltd
Shri Keshav Cements & Infra
Omaxe Ltd
Talbros Engineering Ltd
Steel Strips Wheels Ltd
J Kumar Infraprojects Ltd
J Kumar Infraprojects Ltd
Alphageo India Ltd
Capital Trade Links Ltd
Coastal Corp Ltd
Jagran Prakashan Ltd
Kolte-Patil Developers
IndiaNivesh Ltd
Satra Properties India Ltd
Nectar Lifesciences Ltd
Inani Marbles & Industries Ltd
Narendra Investments Delhi Ltd
Zenlabs Ethica Ltd
Kridhan Infra Ltd
Savita Oil Technologies Ltd
21
Reliance Capital Ltd
Atul Auto Ltd
APL Apollo Tubes Ltd
Ajmera Realty & Infra India Ltd
Gujarat Natural Resources Ltd
TPL Plastech Ltd
Oil & Natural Gas Corp Ltd
Kwality Ltd
Zenith Fibres Ltd
CHD Chemicals Ltd
Goodluck India Ltd
Pee Cee Cosma Sope Ltd
Hi-Tech Gears Ltd/The
Nandan Denim Ltd
Talwalkars Better Value Fitness Ltd
Monte Carlo Fashions Ltd
Power Mech Projects Ltd
Responsive Industries Ltd
Swasti Vinayaka Synthetics Ltd
AurionPro Solutions Ltd
AurionPro Solutions Ltd
Ashoka Buildcon Ltd
DIL Ltd
Catvision Ltd
Tirupati Sarjan Ltd
Sacheta Metals Ltd
Abirami Financial Services
Sagar Productions Ltd
Sri KPR Industries Ltd
KMS Medisurgi Ltd
22
West Leisure Resorts Ltd
Lokesh Machines Ltd
Agarwal Industrial Corp Ltd
Rolta India Ltd
23
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Religare Morning Digest
September 22, 2017
Corporate Action Calendar — September 2017 (Stock Split)
Sun Mon Tue Wed Thu Fri Sat
17 18
19 20 21
Yes Bank Ltd
22
Safari Industries India Ltd
23
Corporate Action Calendar — September 2017 (Stock Dividend)
Sun Mon Tue Wed Thu Fri Sat
17 18
Tata Elxsi Ltd
19 20 21
22 23
Corporate Action Calendar — September 2017 (Acquisition)
Date Target Company Acquirer Company
9/18/2017 Worldwide Leather Exports Ltd Jainalco Industries Pvt Ltd
9/18/2017 Golkonda Aluminium Extrusions Ltd Private Investor
Corporate Action Calendar — September 2017 (Stock Buyback)
Sun Mon Tue Wed Thu Fri Sat
17 18
19
Sobha Ltd
20 21
22 23
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Religare Morning Digest
September 22, 2017
Current Portfolio and Performance Summary as on 21st September’17
Stock Sector Entry Date Weight Reco price (`) CMP (`)
Amara Raja Batteries Auto March 22, 2017 9.6% 868 774
RBL Bank Financial Services July 11, 2017 9.5% 532 533
Muthoot Finance Financial Services July 26, 2017 10.3% 482 503
Talwalkars Better value
Fitness Health Fitness July 27, 2017 9.4% 302 283
Va Tech Wabag Infrastructure August 16, 2017 9.6% 636 633
Nilkamal Plastic Products August 17, 2017 9.0% 1,682 1,571
PPAP Automotive Auto Ancillaries September 14, 2017 9.5% 383 371
Can Fin Homes Financial Services September 19, 2017 11.3% 2,859 2,797
CARE Financial Services September 20, 2017 10.5% 1,493 1,472
Cash 11.3%
Total 100%
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Religare Morning Digest
September 22, 2017
Historical Performance as on 21st September’17
Performance Matrix 3-Month 6-Month 1-Year Since Inception
Religare Alpha 1.9% 11.9% 8.0% 38.9%
Nifty 5.1% 11.1% 15.3% 28.4%
Outperformance -3.2% 0.8% -7.3% 10.5%
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Religare Morning Digest
September 22, 2017
Research Product Basket
For cash market trading
Call / Product Call Frequency No. of calls Avg open call duration % funds allocated
Intraday Calls Intraday 2 - 3 < 1 day 25%
Live / RMD Calls Daily 3 - 4 3 - 4 days 30%
Master Pick Weekly 1 1 month 15%
Religare Alpha Opportunity NA 2 - 3 months 20%
Cash NA 10%
For 1L margin*
Total Per Call
25,000 8,000
30,000 4,000
15,000 5,000
20,000 As per weightage
10,000
Intraday Calls These calls are flashed live on Ms Lync and ODIN with the purpose of squaring off positions on the same day. As a policy, we restrict our
intraday cash market calls to less than 4 calls a day. Hence, funds should be allocated accordingly to have provision to trade in all calls.
Live / RMD Calls 2 super ideas are flashed in RMD daily with a view of 3-4 days. Additionally as per market opportunity, we flash live calls during the day
(including BTST calls). 3-4 such calls are made on a daily basis which might be open for 3-4 days. Funds should be allocated keeping in mind that
there will be 7-8 such open calls daily.
Master Pick This is our weekly recommendation shortlisted on the basis of techno-funda analysis. 15% of funds is recommended to be allocated for Master
Pick considering that there will be 3 open calls. The average open duration for this call will be 1 month.
Religare Alpha This is a portfolio of 8-10 stocks which are held with a view of 2-3 months. It is recommended to allocate 20% of funds for building this portfolio
which will provide stability to the overall trading portfolio.
Cash 10% surplus cash in the portfolio should be kept for the purposes of allocating it to opportunities as and when they arrive.
For derivative market trading
Call / Product Call Frequency No. of calls Avg open call duration % funds allocated
Derivative Ideas Daily 1 - 2 1 - 3 days 40%
Live calls Intraday / Daily 1 - 2 3 - 4 days 50%
Cash NA 10%
For 1L margin*
Total Per Call
40,000 40,000
50,000 50,000
10,000
Derivative Ideas 1 derivative idea is shared in RMD daily. It can be a plain vanilla F&O buy/sell call or an option strategy. Funds should be allocated assuming 2
such calls will be open at any time. These calls are open for 3-4 days on an average.
Live Calls These calls are flashed on MS Lync and ODIN during live market hours. These calls can be intraday or with a view of 2-3 days. Funds should be
allocated considering 2 such calls will be open at any time. 3/4 times, these calls will be on Nifty / Bank Nifty only.
Cash It is recommended to hold 10% cash to capitalize on any opportunity that may arise in markets.
For every client, the advisor must allocate a specific proportion of funds for trading and investing depending on the risk taking ability and willingness of the client
and their investment goals.
The below mentioned product basket tries to address the way to deal with the trading portfolio (cash/derivative) for optimum effectiveness of research calls.
It is recommended to divide your trading funds for various types of calls and not invest the entire amount for 1 or 2 calls only.
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Religare Morning Digest
September 22, 2017
Hitesh Agrawal [email protected]
Ajay Pasari, CFA [email protected]
Ajit Mishra [email protected]
Archana Gude [email protected]
Manoj M Vayalar [email protected]
Mehernosh Khurshed Panthaki [email protected]
Siji A Philip [email protected]
Suhanee Shome [email protected]
Team Members
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Religare Morning Digest
September 22, 2017
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Specific analyst(s) specific disclosure(s) inter-alia as required under Securities and Exchange Board of India (Research Analysts) Regulations, 2014 is/are as under:
Statements on ownership and material conflicts of interest , compensation– Research Analyst (RA)
[Please note that only in case of multiple RAs, if in the event answers differ inter-se between the RAs, then RA specific answer with respect to questions under F (a) to F(j) below , are given separately]
Nature of Interest ( if answer to F (a) above is Yes : ……………………………………………………………………………………………………………………
Name(s) with Signature(s) of RA(s).
[Please note that only in case of multiple RAs and if the answers differ inter-se between the RAs, then RA specific answer with respect to questions under F (a) to F(j) above , are given below]
Copyright in this document vests exclusively with RSL. This information should not be reproduced or redistributed or passed on directly or indirectly in any form to any
other person or published, copied, in whole or in part, for any purpose, without prior written permission from RSL. We do not guarantee the integrity of any emails or attached files and are not responsible for any changes made to them by any other person.
S. No. Statement Answer
Yes No
I/we or any of my/our relative has any financial interest in the subject company? [If answer is yes, nature of Interest is given below this table] No
I/we or any of my/our relatives, have actual/beneficial ownership of one per cent. or more 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?
No
I/we or any of my/our relative, has any other material conflict of interest at the time of publication of the research report or at the time of public appearance?
No
I/we have received any compensation from the subject company in the past twelve months? No
I/we have managed or co-managed public offering of securities for the subject company in the past twelve months? No
I/we have received any compensation for brokerage services from the subject company in the past twelve months? No
I/we have received any compensation for products or services other than brokerage services from the subject company in the past twelve months? No
I/we have received any compensation or other benefits from the subject company or third party in connection with the research report? No
I/we have served as an officer, director or employee of the subject company? No
I/we have been engaged in market making activity for the subject company? No
SS..No. Name(s) of RA.
Signtures of RA
Serial Question of question which the signing RA needs to make a separate declaration / answer
Yes No.