In the week gone by, the talk of the street was US election and coronavirus. I Actually, volatility gripped financial markets with the US election outcome clouded by huge uncertainty. However, markets across the globe rallied as investors bet Republicans would hold onto the Senate and prevent changes under a possible Joe Biden White House that would squeeze corporate profits. The Federal Reserve kept its loose monetary policy intact on Thursday and pledged again to do whatever it can in coming months to sustain a U.S. economic recovery losing speed amid a spreading coronavirus pandemic and facing uncertainty over a still-undecided presidential election. On the data front, October’s final manufacturing PMI data for the euro zone came in at 54.8, up from 53.7 in September and outstripping expectations. China’s factory activity expanded for the sixth straight month in October as business confidence grew to its strongest in years.
Back at home, the Indian market rallied in sync with gains in major global peers. Investors also took note of the improving macro scenario in the country. Activity in India’s dominant services industry expanded for the first time in eight months in October as demand surged. The Nikkei/IHS Markit Services Purchasing Managers’ Index climbed to 54.1 in October from September’s 49.8. It is expected that the relaxation of lockdown rules in India helped the service sector move towards a recovery in September. Meanwhile, RBI has said it will continue to conduct open market operation (OMO) purchase auctions of Rs 20,000 crore, as well as OMOs in State Development Loans (SDLs) to support market sentiment and assure adequate liquidity. Since the announcements made after the Monetary Policy Committee meeting on October 9, the RBI has expanded the scale of outright open market operation purchases of Government of India securities from Rs 10,000 crore to Rs 20,000 crore per auction. In another development, RBI said that banks and nonbanking finance companies (NBFCs) could do co-origination of loans to the priority sector. Under this, banks are permitted to co-lend with all registered NBFCs (including HFCs) based on a prior agreement. Meanwhile, the SEBI has increased the overseas investment limit for individual mutual funds (MFs) to $600 million. Earlier, this limit was $300 million. The government on Thursday removed several requirements in order to enable IT and business process management (BPM) companies to adopt permanent ‘Work from Home’ and ‘Work from Anywhere’ policies, in a substantial reform initiative for the technology sector. Going forward, market will take direction from macroeconomic data schedule next week, the outcome of the US Presidential elections, movement of Indian rupee and crude oil prices.
On the commodity market front, with so close fight between Democrats and Republican in US, the financial market was in jittery and traders were completely on their toes. Commodities gave mixed signal. Huge wild moves in dollar index gave both side movements in commodities. It will take few days to get final numbers of US elections, till the time market may continue to see high volatility. Gold and silver may see the higher side of 52500 and 65500 respectively. Physical buying of gold is likely to improve on the occasion of Dhanteras and Diwali. Crude should move in a rage of 2600- 3050 levels. Inflation Rate of Mexico, Germany and China, Employment Change in UK, ZEW Economic Sentiment Index of EU, ZEW Economic Sentiment Index of Germany, Interest Rate Decision of New Zealand, RBNZ Press Conference, GDP of UK and Russia, Core Inflation Rate and Inflation Rate of US, Michigan Consumer Sentiment, GDP Growth Rate QoQ 2nd Est of Euro Area etc are lots of data and events scheduled this week which could be major trigger apart from US Elections final outcome.
SMC Global Securities Ltd. (hereinafter referred to as “SMC”) is a registered Member of National Stock Exchange of India Limited, Bombay Stock Exchange Limited and its associate is member of MCX stock Exchange Limited. It is also registered as a Depository Participant with CDSL and NSDL. Its associates merchant banker and Portfolio Manager are registered with SEBI and NBFC registered with RBI. It also has registration with AMFI as a Mutual Fund Distributor.
SMC is a SEBIregistered Research Analyst having registration number INH100001849. SMC or its associates has not been debarred/ suspended by SEBI or any other regulatory authority for accessing /dealing in securities market.
SMC or its associates including its relatives/analyst do not hold any financial interest/beneficial ownership of more than 1% in the company covered by Analyst. SMC or its associates and relatives does not have any material conflict of interest. SMC or its associates/analyst has not received any compensation from the company covered by Analyst during the past twelve months. The subject company has not been a client of SMC during the past twelve months. SMC or its associates has not received any compensation or other benefits from the company covered by analyst or third party in connection with the research report. The Analyst has not served as an officer, director or employee of company covered by Analyst and SMC has not been engaged in market making activity of the company covered by Analyst.
The views expressed are based solely on information available publicly available/internal data/ other reliable sources believed to be true.
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SAFE HARBOR STATEMENT: Some forward statements on projections, estimates, expectations, outlook etc are included in this update to help investors / analysts get a better comprehension of the Company's prospects and make informed investment decisions. Actual results may, however, differ materially form those stated on account of factors such as changes in government regulations, tax regimes, economic developments within India and the countries within which the Company conducts its business, exchange rate and interest rate movements, Impact of competing products and their pricing, product demand and supply constraints. Investors are advised to consult their certified financial advisors before making any investments to meet their financial goals.
The business of the bank grew strongly and management of the bank has focused in retail banking which would continue to give strong, balanced credit growth and improvement in asset quality. New partnerships with Insurance and Mutual Funds distribution with companies like Star Health, Integrated Enterprises, BSE Star Mutual Funds, etc. would help to increase other income. Thus, it is expected that the stock will see a price target of Rs.196 in 8 to 10 months time frame on one year P/Bvx 2.25 and FY22 (BVPS) of Rs.87.01.
With the overall experience of HCAG in India and adequate liquidity available in HCIL, the company might consider inorganic expansion for future capacity growth. The company has ability to maintain its operating parameters amid the inherent cyclical trends in the demand and supply of cement. Thus, it is expected that the stock will see a price target of Rs.230 in 8 to 10 months time frame on a three year average P/BV of 3.20x and FY22 BVPS of Rs.71.78.
The stock closed at Rs 380.50 on 06th November 2020. It made a 52-week low at Rs 234 on 23rd March 2020 and a 52-week high of Rs. 382.80 on 03rd September, 2020. The 200 days Exponential Moving Average (DEMA) of the stock on the daily chart is currently at Rs 348.35.
Short term, medium term and long term bias are looking positive for the stock as it is trading in higher highs and higher lows on chart which is bullish in nature. Apart from this, it is forming an “Inverted Head and Shoulder” pattern on weekly charts, considered bullish. Last week, stock has given the pattern breakout along with high volumes so buying momentum may continue for coming days. Therefore, one can buy in the range of 377-379 levels for the upside target of 405-410 levels with SL below 360.
The stock closed at Rs 801.25 on 06th November, 2020. It made a 52-week low of Rs 519.40 on 19th March, 2020 and a 52-week high of Rs. 1026 on 15th November, 2020. The 200 days Exponential Moving Average (DEMA) of the stock on the daily chart is currently at Rs 816.11.
After registering the swing high of 920 levels, stock witnessed healthy correction and formed a “Bull Flag” pattern on weekly charts, which is a bullish pattern. Last week, stock ended over 4% gains, has given the breakout of pattern with huge volumes so follow up buying may continue for coming days. On the technical indicators front, RSI and MACD are also suggesting buying for the stock. Therefore, one can buy in the range of 790-795 levels for the upside target of 870-890 levels with SL below 750.
Disclaimer : The analyst and its affiliates companies make no representation or warranty in relation to the accuracy, completeness or reliability of the information contained in its research. The analysis contained in the analyst research is based on numerous assumptions. Different assumptions could result in materially different results.
The analyst not any of its affiliated companies not any of their, members, directors, employees or agents accepts any liability for any loss or damage arising out of the use of all or any part of the analysis research.
SOURCE: RELIABLE SOFTWARE
Charts by Reliable software
Indian markets ended last week on a positive note with Bank Nifty taking the lead with whopping gains of more than 12% while nifty surged more than 5%. The up move was supported by a sharp surge in HDFC and Bajaj twins along with positive moves witnessed by Axis Bank, ICICI Bank and IndusInd Bank. From derivatives front, call writers at 12000 strike triggered short covering while put writers seen shifted to higher bands. Nevertheless, volatility is likely to grip the market in the coming sessions as well with bias likely to remain in favour of bulls.The Implied Volatility (IV) of calls closed at 18.06% while that for put options closed at 20.14. The Nifty VIX for the week closed at 20.97%. PCR OI for the week closed at 1.49 down from the previous week. On the technical front, Nifty has now major support in zone of 12000-11900 and any dip into prices should be use to create fresh longs. On higher side 12500 would be major resistance for nifty.
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**The highest call open interest acts as resistance and highest put open interest acts as support.
# Price rise with rise in open interest suggests long buildup | Price fall with rise in open interest suggests short buildup
# Price fall with fall in open interest suggests long unwinding | Price rise with fall in open interest suggests short covering
Turmeric futures (Dec)shall continue to trade with a downside bias facing resistance near 5920 levels, while the downside may get extended towards 5700-5600 levels. The outlook is dim due to an absence of strong demand amid ample carryover stocks. On the spot, traders are quoting the price for the turmeric based on its quality. For the past few months medium quality turmeric is arriving for sale. The buyer traders those who receive the local demand and few upcountry demands quoting the price cautiously. The farmers are unhappy over the prevailing price, as the traders are buying limited turmeric. Most traders have not yet received fresh upcountry demand, nor from local turmeric powder grinding units and masala firms. Jeera futures(Dec)is looking bullish and lower level buying can emerge near 14300, eyeing upside levels of 14800-15000. Strong buying sentiment accompanied by reduced supplies in key markets of Gujarat and Rajasthan. The overseas orders are good and there is increased buying on the back of Diwali festivities. On the flip side, supplies from Gujarat and Rajasthan have remained thin amid good export demand. In the world market also, India is the only supplier. Turkey and Syria do not have competitive supplies. Dhaniya futures (Dec) is expected to witness selling pressure and this can drag the counter to 6500- 6400. The sentiments are bearish as despite festival season, no major pickup in demand is seen from domestic buyers. Moreover, sowing for the next crops has commenced in the producing regions of Rajasthan, Madhya Pradesh and Uttar Pradesh. Having said so, big buyers like the retail store owner, millers are avoiding any heavy purchases at the moment.
Bullion counter bounced to a more than three-week peak as increasing bets of a Joe Biden victory in the close U.S. election boosted hopes for larger stimulus and dented the dollar, ahead of a Federal Reserve policy statement. FOMC left the benchmark interest rate unchanged at 0%-0.25%. Democratic challenger Joe Biden leads President Donald Trump in national polls but the race is much tighter in battleground states that determine the election outcome. But on the flip side, Donald Trump moved to file lawsuits and request for a recount in votes in several battleground states. The dollar has faded dramatically on the back of the expectation for the additional stimulus plan to get in place now that the elections are over. The dollar fell to a two-week low, making gold cheaper for holders of other currencies, ahead of the Fed policy decision. The election result, when we get it, is likely to be gold-friendly with a likely weakening dollar, fresh stimulus, rates in negative territory, and likelihood that the Fed will start buying longer-term assets. People are still carrying bullish bias on gold because of the coronavirus worries, slowdown in global economies, and stimulus measures, which is prompting investors to add gold into their portfolios. The United States, Russia, France, and many other countries are setting records for coronavirus infections, forcing some countries to impose new curbs. This week, we may witness huge volatility and gold may trade in the range of 51700 -53100 and Silver may trade in the range of 59200-65100. Whereas on COMEX gold may trade in the range of $1900- $1990 and Silver may trade in the range of $22.70-$27.10.
Soybean futures (Dec) is likely to hold on the support near 4250 levels, while the upside may get extended towards 4450-4500 levels. The fundamentals are giving a strong support to this oilseed in the domestic as well as in the international market. Chicago soybean futures are on track for its biggest gain since late August amid dry weather in Brazil and strong Chinese demand. Back at home, reports of damage to soybean crop and increased arrival of infected crops is lifting soybean prices in Indore mandis. The stout demand for soybean oil and meal prices is keeping the millers margin up in range of Rs.120/150 per qtl making it feasible to crush aggressively at higher volumes. This is keeping soybean demand robust. The outlook for RM Seed futures (Dec) is bullish and every dip can be taken as a buying opportunity eyeing an upside target of 6350-6500 levels. The fact that the inventories are depleting at a fast pace and there will be very little carry over stock for next season due to lower crop and higher consumption has stimulated buying spree among the stockiest. As per the report, as on 31 October, India’s mustard stock was estimated at mere 15.50 lakh tons at the end of last month. Meanwhile the new crop will arrive in mandis in February. So, the buyers will have to rely on present stock till January.Soy oil futures (Dec) is expected to maintain its bull run and witness 1020-1030, while CPO (Nov) is also like to witness extended upside move towards 880-900 levels respectively. On the global market, the edible oils are reaching multi-year high mainly due to supply side disruptions and China’s strong appetite for edible oils.
Crude oil prices continued to extending losses as new lockdowns in Europe to halt surging COVID-19 infections sparked concern about the outlook for demand, while markets remained on edge over drawn-out vote counting in the U.S. election. Italy recorded its highest daily number of infections and cases surged by at least 120,276 in the United States, the second consecutive daily record as the outbreak spreads across the country. COVID-19’s rampage across Europe and the U.S. is likely to deliver a hit to consumption. With no concrete evidence that OPEC+ is moving to slow or reverse the pace of production increases, the supply/demand imbalance has capped oil’s pre-election rally. Vote counting and trends from the U.S. election point to the Republicans retaining control of the Senate, while Democrats are expected to take a slimmed majority in the House of Representatives, dashing hopes for a large stimulus package, another factor weighing on oil. This week crude price may witness huge volatility within the range of 2600-2940, where selling pressure can be seen near the resistance. Natural gas futures traded weaker as participants increased their short positions as seen by the open interest. The weather is expected to be much colder than normal in the western part of the US and much warmer than normal on the east coast which should net reduce heating demand. The forecast for Hurricane Eta to move back into the Caribbean as opposed to the Gulf of Mexico provide the backdrop for lower prices. This week Natural gas may trade with bearish bias as medium-term momentum has turned negative as the fast stochastic generated a crossover sell signal.
Cotton futures (Nov) is expected to trade with an upside bias in the range of 19600-19900 levels. The demand side is giving strong signals amid the estimates that India’s cotton exports could jump 40% in 2020/21 from a year ago to 7 million bales, the highest in seven years, as depreciation of the rupee and a rally in global prices allow exporters to clinch export contracts. A recovery in global prices could lift Indian exports to 7 million bales in the new season from 5 million bales a year ago. Most of the shipments are heading towards China and Bangladesh. In October traders exported 700,000 bales and contracts for another 1 million bales have signed for November shipment. Chana futures (Dec) is likely to consolidate in the range of 5250-5450 with upside getting capped. The market participants will be following up on NAFED sanctioning or rejecting the tenders to understand prices and direction going forward. Meanwhile, the sowing process has begun for the Rabi season &in Rajasthan area under chana is up nearly 52% this season, according to state agriculture department as on 3rd November, 2020. While, in Gujarat sowing of pulses have started on a strong note as there is ample water availability in the reservoirs. Guar seed futures (Dec) may consolidate in the range of 4250- 4400, while guargum (Dec) may remain steady in the range of 6500-6900 levels, respectively. Guar gum and seed market of Rajasthan are eyeing US election very eagerly as Joe Biden more suitable for the future of gum market as he will discourage chemical use in various industrial activities including crude oil exploration which will push guar gum demand.
Base metals may trade in the range with high volatility until there is clarity on the US election outcome. Meanwhile the FOMC left the benchmark interest rate, the target range for federal funds, unchanged at 0%-0.25% and committed to using the full range of its tools to support the US economy and noted that the path of the economy will continue to depend significantly on the course of the coronavirus outbreak. Copper may trade in the range of 515- 545 levels. Copper prices may come under pressure amid signs of weakening demand from China. But a steady decline in inventory across exchange warehouses along with supply disruption in Chile may cap the downside. A union of workers at Chile’s Candelaria copper mine, owned by Canada’s Lundin Mining Corp, said it had rejected yet another contract offer from the company and will push forward with a nearly month-long strike that has shut down the mine. Zinc may trade in the range of 195-215 levels while Lead can move in the range of 145-155 levels. Zinc concentrate treatment charges continued to slide in October, falling to a 26-month low with near-term demand continuing to outweigh immediate supplies of material. Nickel may test 1200 level by taking support near 1140 levels. China's Lygend Resources & Technology Co Ltd will not begin operating a nickel smelter at a project planned for eastern Indonesia until March 2021, a six-month delay, after the coronavirus slowed work. Aluminum may move in the range of 150-162 levels. China, the world’s biggest producer and consumer of the metal, is seeking to cap overall smelting capacity at around 45 million tonnes per year to control emissions.
NATURAL GAS MCX (NOV) contract closed at Rs. 221.70 on 05th Nov’2020. The contract made its high of Rs. 251.30 on 02nd Nov’2020 and a low of Rs. 216 on 06th Nov’2020. The 18-day Exponential Moving Average of the commodity is currently at Rs. 235.04. On the daily chart, the commodity has Relative Strength Index (14-day) value of 33.665.
One can buy near Rs. 215 for a target of Rs. 250 with the stop loss of Rs. 199.
NICKEL MCX (NOV) contract closed at Rs. 1161.30 on 05th Nov’2020. The contract made its high of Rs. 1207.90 on 28th Oct’2020 and a low of Rs. 1043.40 on 01st Oct’2020. The 18-day Exponential Moving Average of the commodity is currently at Rs. 1150.56. On the daily chart, the commodity has Relative Strength Index (14-day) value of 57.068.
One can buy near Rs. 1155 for a target of Rs. 1220 with the stop loss of Rs. 1130.
CHANANCDEX (DEC) contract was closed at Rs. 5240.00 on 05th Nov’2020. The contract made its high of Rs. 5703.00 on 09th Oct’2020 and a low of Rs. 5132.00 on 16th Sep’2020. The 18-day Exponential Moving Average of the commodity is currently at Rs. 5333.73. On the daily chart, the commodity has Relative Strength Index (14-day) value of 46.529.
One can buy near Rs. 5240 for a target of Rs. 5540 with the stop loss of Rs 5090.
With so close fight between Democrats and Republican in US, the financial market was in jittery and traders were completely on their toes. Commodities gave mixed signal. Huge wild moves in dollar index gave both side movements in commodities. Earlier DXY and US bond rallied when the fight was very close…gradually Biden marched towards majority and we have seen outflows from safe haven buying. Nevertheless, gold bullion counter took the advantage of fall in dollar index and saw massive upside on Thursday. A large decline in long-term Treasury yields due to expectations for less fiscal spending, combined with a rally in equities and other risk assets, has placed the dollar under consistent selling pressure that is likely to continue.Investors are betting that Democrat Joe Biden will become the next president but Republicans will retain control of the Senate, which will make it difficult for the Democrats to pass the larger fiscal spending they have been pushing. Base metals traded in a range and traders refrained to take aggressive positions. In all this state of confusion, bullion counter rose on benefits of doubt. President Donald Trump questioned the credibility of the U.S. election, complaining that public polls had overstated Joe Biden’s lead in many battleground states and the ongoing count of mail-in votes was eroding his lead in Pennsylvania and Georgia. Trump gave a statement to reporters at the White House on Thursday.Gold headed for the biggest weekly gains in more than three months. Silver too caught the rally of gold. Gold and silver closed near 51900 and 64500 respectively. In energy counter, oil saw some steady move despite all ambiguity. U.S. inventories of crude oil plunged last week, although much of the fall was attributed to production being shut down as another hurricane swept through the Gulf of Mexico.The Organization of the Petroleum Exporting Countries and allies including Russia, a group known as OPEC+, are expected to delay bringing back 2 million barrels per day of supply in January, given the decline in demand from new COVID-19 lockdowns.
Reports of damage to soybean crop and increased arrival of infected crops also lifted soybean prices amid firm international market. Chicago soybean futures reached the $11 a bushel mark for the first time in over four years on Thursday as dry weather in parts of South America continued to raise supply concerns at a time of brisk Chinese demand. Malaysian palm oil futures climbed more than 3% to an eight-year high on Thursday, extending gains to a third straight session on surveys showing a steep decline in October stockpiles and production. Nafed Commences Sale of Chana in Maharashtra, Karnataka, AP& Telangana With Effect From 5 November, 2020. It put pressure on Chana futures.
Global gold demand dropped by 19% y-o-y to 892 tonnes for the July-September quarter, as consumers continued to feel the impact of the COVID-19 pandemic. This was the lowest quarterly total since the third quarter of 2009. The Year-to-date demand of 2 972.1t was 10% lower versus the same period in 2019, according to the World Gold Council’s latest Gold Demand Trends report.
However, investment demand rose 21% year-on-year as investors bought gold bars, coins and gold-backed ETFs. Investors globally bought 222.1t of gold bars and coins and an additional 272.5t through gold-backed ETFs. This is record inflows into goldbacked ETFs in Q3, taking the Year-to-date global total to a record high of 1003.3t. However, the combination of continued social distancing restrictions in many markets, the economic slowdown, and a record high gold price in many currencies proved too much for many jewellery buyers. Demand declined by 29% y-o-y at 333t, down from an already relatively anaemic Q3 2019. The jewellery buying in China and India accounted for the largest volume declines.
The weakness caused by COVID-19 was compounded by record gold prices. The gold price rose to a record high of US$ 2 067.15/oz in early August. This was followed by a pullback with the price closing the quarter around US$ 1900/oz. Record high prices were also seen invariousothercurrencies,amongthemtherupee,theyuan,theeuro,andsterling.
Bar and coin investment jumped to 222.1t in Q3 – up 49% y-o-y. The largest volume increases were seen in western markets, China and Turkey, in contrast with continued significant sales in Thailand. Demand in the technology sector fell by 6% year-on-year to 76.7t.
Central banks sold 12.1 tonnes of gold in net sales in the July-September quarter for the first time since late 2010. That was driven primarily by central banks in Uzbekistan and Turkey while six others, including the Reserve Bank of India, modestly increased their gold reserves, according to the report.
Demand for gold in India declined 30% to 86.6 tonnes for the third quarter ended September. The demand for gold stood at 123.9 tonnes in the same quarter last year. In terms of value, gold demand declined by 4 per cent during the quarter under review at Rs 39, 510 crore compared to Rs 41,300 crore in the same quarter of 2019. Jewelry demand in India between July to September fell 48% year-on-year to 52.8 tonnes from around 101.6 tonnes a year earlier, the organization said in a report. But demand for gold as an investment rose 52% to 33.8 tonnes on-year. This has been partially due to easing of lockdown and digital platforms selling allocated gold through wallets also recorded sharp rise in volumes, along with significant activity in gold exchange-traded funds (ETFs).
Total gold recycled in India in the third quarter was 41.5 tonnes, up by 14 per cent compared to 36.5 tonnes in the same quarter of 2019.
Healthy sales during a recent festival Dussehra gave confidence to Indian jewellers. Now they are awaiting Diwali, Dhanteras and other festivals in November. In spite of high price, Covid shadows a good monsoon this year will boost sentiment.
Indian Rupee this week fell briefly to three months low towards 74.90 amid riskaversion sentiment just ahead of US election. However as the odds of Biden's wins are improving, rupee pared over two-third losses in quick span of time. Globally the US dollar is about to close on its weakest level in two-and-a-half years, after a dash for riskier assets following Tuesday’s presidential election triggered a move that accelerates risk-on sentiment across the markets. The Dollar Index fell nearly halfa-percent on Thursday, putting it within touching distance of its August low. The move comes amid a shake-up in financial markets following the vote, which undermined expectations of a comprehensive victory for the Democrats. Admittedly in short-term the US dollar trades lower on the easing of geopolitical uncertainty as expectations that a Biden presidency would back away from Donald Trump’s confrontational trade policy were also giving currencies such as the Chinese renminbi a boost. Going forward next week with a possible Joe Biden’s win will keep the dollar trend lower which will support euro, pound and other major’s currencies. The US dollar is closing in on its weakest level in two-and-a-half years, after a dash for riskier assets following Tuesday’s presidential election triggered a move that has left some traders scratching their heads. The buck fell as much as 1 per cent against a basket of other major currencies on Thursday, putting it within touching distance of its August low. The move comes amid a shake-up in financial markets following the vote, which undermined expectations of a comprehensive victory for the Democrats.
USD/INR (NOV) contract closed at 74.2300 on 05-Nov-20. The contract made its high of 75.0375 on 04-Nov-20 and a low of 74.2050 on 05-Nov-20 (Weekly Basis). The 21-day Exponential Moving Average of the USD/INR is currently at 74.1200.
On the daily chart, the USD/INR has Relative Strength Index (14-day) value of 53.24. One can sell at 74.50 for the target of 73.50 with the stop loss of 75.10.
GBP/INR (NOV) contract closed at 96.9575 on 05-Nov-20. The contract made its high of 97.5000 on 04-Nov-20 and a low of 95.9300 on 02-Nov-20 (Weekly Basis). The 21-day Exponential Moving Average of the GBP/INR is currently at 96.2700.
On the daily chart, GBP/INR has Relative Strength Index (14-day) value of 56.99. One can sell at 97.75 for a target of 96.75 with the stop loss of 98.35.
| 02nd NOV | Euro zone factories boomed in October as Germany roared: PMI |
| 02nd NOV | U.S. manufacturing near two-year high; road ahead difficult |
| 03nd NOV | New ECB stimulus willreflect changed market conditions: Schnabel |
| 04th NOV | U.S. employment, services industry data point to slowing economic recovery |
| 05th NOV | Japan's October services sector moves closer to stabilisation - PMI |
| 05th NOV | Bank of England said to be considering a move into negative rates - Telegraph |
| 05th NOV | Fed keeps policy steady as Biden inches closer to victory |
| 05th NOV | Bank of England ramps up stimulus again to tackle COVID-19 and Brexit hit |
| 06th NOV | Japan's Suga says stable currency moves 'extremely important' |
EUR/INR (NOV) contract closed at 87.6475 on 05-Nov-20. The contract made its high of 87.7050 on 05-Nov-20 and a low of 86.6450 on 02-Nov-20 (Weekly Basis). The 21-day Exponential Moving Average of the EUR/INR is currently at 87.1800.
On the daily chart, EUR/INR has Relative Strength Index (14-day) value of 56.58. One can buy at 87.50 for a target of 88.50 with the stop loss of 86.90.
JPY/INR (NOV) contract closed at 71.2050 on 05-Nov-20. The contract made its high of 71.5400 on 04-Nov-20 and a low of 71.0250 on 03-Nov-20 (Weekly Basis). The 21-day Exponential Moving Average of the JPY/INR is currently at 70.6700.
On the daily chart, JPY/INR has Relative Strength Index (14-day) value of 60.55. One can buy at 71.50 for a target of 72.50 with the stop loss of 70.90.
(3/5)
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The company proposes to utilise the Net Proceeds towards funding the following objects:
Considering the P/E valuation on the upper end of the price band of Rs. 1500, the stock is priced at pre issue P/E of 30.07x on its FY20 EPS of Rs. 49.88. Post issue, the stock is priced at a P/E of 31.69x on its EPS of Rs. 47.33. Looking at the P/B ratio at Rs. 1500 the stock is priced at P/B ratio of 6.37x on the pre issue book value of Rs.235.32 and on the post issue book value of Rs. 299.86 the P/B comes out to 5.00x.
On the lower end of the price band of Rs.1490 the stock is priced at pre issue P/E of 29.87x on its FY20 EPS of Rs. 49.88.Post issue, the stock is priced at a P/E of 31.48x on its EPS of Rs. 47.33. Looking at the P/B ratio at Rs.1490, the stock is priced at P/B ratio of 6.33x on the pre issue book value of Rs. 235.32 and on the post issue book value of Rs. 299.86, the P/B comes out to 4.97x.
Gland Pharma Ltd is one of the fastest-growing generic injectable companies. It manufactures a diversified range of high-quality complex injectables. The company offers products like sterile injectables, oncology, and ophthalmics, complex injectables (peptides, suspensions, hormonal products, long-acting injectables), NCE-1s, First-to-File products, etc.
Extensive and vertically integrated injectables manufacturing capabilities: Seven manufacturing facilities are situated in southern India including two sterile injectables facilities, one dedicated Penems facility, one oncology facility and three API facilities. The finished formulation manufacturing facilities with a total of 22 production lines possess the flexibility to accommodate different product requirements without the need to install new production lines.
Diversified B2B-led model across markets, complemented by a targeted B2C model in India: B2B business models enable Gland to (i) grow market share in key markets such as the United States, Europe, Canada and Australia, particularly the United States, while reducing the marketing investments it needs to make,(ii)leverage the reputation ofits marketing partners in their home markets to build their own presence in these markets, (iii) build its own reputation as a complex injectables manufacturer with a consistent compliance record attracting confidence from other potential marketing partners. In the June Qtr,revenue generated from B2C model was around 3% in India.
Extensive portfolio of complex products supported by internal R&D and regulatory capabilities: As of June 30, 2020, it had a total workforce of 3,766 excluding contract labourers across these business divisions, including an in-house R&D team for product development, regulatory affairs for obtaining product registrations, manufacturing, supply chain management, and sales and marketing. The company at present in sterile injectables, oncology and ophthalmics, and focus on complex injectables, NCE-1s, First-to-File products and 505(b)(2) filings. It has established a portfolio of injectable products across various therapeutic areas and delivery systems. As of June 30, 2020, along with its partners, it had 267 ANDA filings in the United States, of which 215 were approved and 52 were pending approval. The 267 ANDA filings comprise 191 ANDA filings for sterile injectables, 50 for oncology and 26 for ophthalmics related products. Out of these 267 ANDA filings, 101 represent ANDAs owned by the company, of which 71 ANDA filings are approved and 30 are pending approval. As of the same date, it along with its partners had a total of 1,427 product registrations, comprising 371 product registrations in the United States, Europe, Canada and Australia, 54 in India and 1,002 in the Rest of the world.
Strong Focus on Processes and Risk Management: It continuously monitors its systems and processes and endeavor to not only benchmark them against Indian competitors but also incorporate industry best practices and technological advancements in its operations.
Expand product portfolio and delivery systems to drive revenue growth: The company has maintained a focus on achieving a diverse product mix offering products at various stages of their lifecycle as well as a robust product pipeline. The company intends to continue enhancing its product portfolio to offer a diverse suite of products to cater to the growing demand for injectables.
Increase current market presence and enter new markets: The company intends to maintain its strategic emphasis on the United States, Europe, Canada and Australia, while continuing to pursue growth opportunities in China, India, Brazil and the Rest of the world. It plans to grow its business in the United States, Europe, Canada and Australia by maintaining an appropriate product mix in its portfolio with products which it consider will improve its profitability as well as utilise its capacities more efficiently.
Align with Shanghai Fosun Pharma to increase market share: Gland can benefit from Shanghai Fosun Pharma's (i) market experience and know-how in navigating through the rapidly evolving Chinese healthcare landscape, (ii) ability to access key markets to provide coverage for a portfolio of products, (iii) scale and bargaining power to procure raw materials and equipment from China, and (iv) extensive sales, logistics and distribution network to enable market penetration across China.
Gland Pharma is one of the fastest growing generic injectable companies in India. With a strong product pipeline and more complex products under development, focus on B2B expansion and licensing and opportunities to enter more therapy areas, the company looks promising. Gland Pharma's promoter Fosun Pharma is a China-based entity. The company will become the first large Indian firm with a Chinese parent to go for public listing. However, only a small amount of the money raised through the issue will go to the company
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Investors pulled out over Rs 7,200 crore from equity-oriented mutual funds during the July-September quarter this year as expensive valuation diverted them towards profit-booking. In comparison, such schemes had witnessed a hefty inflow of Rs 23,874 crore in the same quarter last fiscal, data from the Association of Mutual Funds in India showed. Although, the asset base of equity mutual funds (MFs) slightly increased to Rs 7.64 lakh crore by the end of September 2020 from Rs 7.24 lakh crore as of September 2019. As per the data, outflows from equity and equity-linked schemes were at Rs 7,214 crore in the three months ended September, while such schemes saw inflows to the tune of Rs 11,710 crore in the June quarter and Rs 30,703 crore in the March quarter. Of Rs 7,214 crore outflows, the schemes witnessed a pull out of Rs 2,480 crore in July, which was the first withdrawal in four years, Rs 4,000 crore in August and Rs 734 crore in September
Debt-oriented mutual fund schemes witnessed a net outflow of over Rs 51,900 crore in September, making it the second consecutive monthly withdrawal, largely on the back of a massive pullout from liquid category. According to the Association of Mutual Funds in India (Amfi), mutual funds (MFs) that invest in fixed-income securities or debt funds saw an outflow of Rs 51,962 crore last month as compared to Rs 3,907 crore in August. Prior to that, debt funds had seen an inflow of Rs 91,392 crore in July, Rs 2,862 crore in June, Rs 63,665 crore in May and Rs 43,431 crore in April. Liquid funds witnessed net outflows to the tune of Rs 65,952 crore, which is where corporate companies tend to park money, followed by ultra short duration funds (Rs 4,867 crore) and money market funds ( Rs 4,857 crore). Credit risk funds saw an outflow of Rs 539 crore in September compared to Rs 554 crore in August, Rs 670 crore in July, Rs 1,494 crore in June, Rs 5,173 crore in May and Rs 19,239 crore in April. Gilt funds, which attracted investor interest in the recent times given their sovereign status and zero exposure to credit risk, experienced net outflow of Rs 483 crore in September, which was lower than the net outflow of Rs 1,122 core in August.
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