News with Tags "cnbc tv18"

Last few sessions have been very tough for the Indian market. Global and domestic factors have pushed the Nifty to the 4,800 mark.

Anil Manghnani, Modern Shares & Stock Brokers says, ever since the Nifty broke the crucial level of 5,080, it’s been on a free fall. Logically, he says, the next target is 4,530. “But honestly I will be very surprised, if it went through in this move. I had expectation earlier in the year that, somewhere closer to Diwali, we would actually revisit the lows of last year,” he adds.

He expects the market to bounce back now, a pullback to maybe 5,100-5,200 and then a resumption of the downtrend.

According to him, Tata Steel  and Sesa Goa  will be interesting bets now.

Also read: More turmoil to come, buy real assets, says Jim Rogers

Below is the edited transcript of his interview with CNBC-TV18′s Udayan Mukherjee and Mitali Mukherjee. Also watch the accompanying video.

Q: It’s been a very difficult week for the market. What kind of markers are you setting for the Nifty on the downside now?

A: Ever since the Nifty broke the crucial level of 5,080, it’s been on a free fall. We had a market earlier on in the year where every time it fell, you had enough bouncing ability, especially at the 5,200 mark. But now it seems like every time there is a mini bounce intraday, it’s clearly caught in some sort of a bear trap. The discount on the futures also suggests some heavy selling at every bounce.

Logically, the next target is 4,530. But honestly I will be very surprised, if it went through in this move. I had expectation earlier in the year that, somewhere closer to Diwali, we would actually revisit the lows of last year. So, I would be surprised if we go there right away.

Although the whole world is caught in some sort of a selling frenzy, many things are combining at major crucial levels. For example, our own Nifty between 4,800 and 4,750 has a host of supports. The dollar index has a resistance around the 81.80-81.90 mark which is not too far away. The VIX, which is closer to 25, has a lot of resistance around the 26 mark. Even the S&P has now come to the cluster of 200-day moving averages and 1,290 is the crucial support, it’s at 1304 right now. So, I think combined all these factors would suggest that not a change in trend, but just from oversold levels or in the dollar case maybe overbought levels, some sort of a pullback is expected. Even the euro at 1.26, which was the low a few months back, is a very crucial support.

I am not saying that the market should bounce, but there is a good possibility that because all these factors are sort of combining at the same point of time, you may get some sort of a relief bounce, a pullback to maybe 5,100-5,200 and then a resumption of the downtrend. The target remains 4,500, but I will be very surprised if we went through in this move. I would expect a pullback first and maybe little later and maybe a month or two later a resumption of the downtrend.

Q: How do you approach any potential downside? Do you still go with the banks, infrastructure, and real estate or are you beginning to see signs of breakdown in spaces like FMCG?

A: I think still a lot of money is moving into defensives, because with the market coming down sharply, net-net basis, we are not seeing a great FII outflow. So, I think maybe what’s being sold into the infrastructure or metals banks is probably moving into defensives. But I think defensives is in that last leg, maybe it will last another three to four months. I think sometime by the end of the year defensives will top out. You are getting the early signs on the charts that they are getting stretched out. So, they may pull up a little more or just hold onto these levels for quite sometime, till the market finds some stability.

If you just compare the Nifty movement to some of the sectoral charts, be it CNX IT or CNX Bank or even CNX Midcap, it’s quite interesting. If you take the 61.8% retracement of the Nifty from 4,530-5,630, it got over at 4,950, but that has not happened in the three indices. 5,700 was a CNX-IT 0.618. It hit that and bounced from there. 6,800 is a CNX Midcap that hasn’t even come yet. I think on the Bank Nifty it’s about 9,091, which probably will hit this morning. But those three indices are clearly outperforming the Nifty. That is something you don’t see. Atleast on the CNX Midcap you think, when the market falls, the Midcap Index should actually over-correct the Nifty. But that’s not happening. That tells me that probably last year most of the damage was done in midcap and this year the largecap is now playing catch up on the downside to what the midcap did last year. So, you could see some more sell-off in the large cap, but I think the Midcap Index might settle sometimes soon. If the market settles at let’s say 4,750 and starts to bounce then even the Bank Nifty should settle at about 9,090 and start to bounce from there.

Q: How do you approach metals stocks now, for e.g., Tata Steel or Hindalco ?

A: I am not convinced yet on Hindalco, specifically the reason is that the market is not at 4,500, but the stock has made a new low. I believe it’s broken the December low. I am not sure.

But Tata Steel will be an interesting bet. Yes, the numbers are out today. But at Rs 396, it’s hitting the major 61.8% retracement of the entire move it did in January and February. So, I wouldn’t mind taking a punt there.

Another interesting one is Sesa Goa . I think when the index was at 5,200 or so, the stock was at Rs 189. Today, at 4,800, the stock is still at Rs 186. So, it’s not bearing too much brunt of selling in the last 300-400 points on the Nifty. That suggests that maybe it’s stabilising.

In an interview to CNBC-TV18 SP Tulsian of sptulsian.com shared readings on stocks across various sectors like Future Capital , Tata Steel , Manappuram Finance .

Below is the edited transcript of Tulsian’s interview with CNBC-TV18. Also watch the accompanying video.

Q: What did you make of that block deal that we saw in Future Capital and now from hereon in anticipation of that stake sale going through how would you approach the stock?

A: The plot is being prepared for 56% stake sell-off by Pantaloon because they seem to be hard pressed. There is no other option. Couple of names have surfaced like Deccan Chronicle and then Warburg Pincus, I think this time the deal is likely to happen. It will be interesting to see at what price it happens because the broad range could be taken anywhere between 160-175. If that happens then it will give good relief to the company.

They will be able to mobilize a good chunk of money. The only thing that matters, is how it will be responded by the market. If you see an amount of Rs 700 to Rs 750 crore, which can be expected maximum from this 56% stake whether considering the debt burden of Rs 7-7.5 crore of Pantaloon group will definitely be taken positive, but to what extent it will be difficult to take a call, But, overall it is positive for Future Capital and Pantaloon Retail in the near term.

Q: There is TISCO that happened post market hours what do you expect to hear from this time around, any shockers like the last quarter or this will be a stronger set?

A: I don’t think that there is any confusion on the domestic front. If you take the standalone I think the same kind of bottomline which has been posted by the company for Q3, Q2 at about Rs 1500 crore PAT will be reported. Disappointment will be coming on from the global operations.

I don’t think that except in any other heads whether you take the freight charges or the employees or any other things where we have seen a normal increase of about 2% on a sequential or on a YoY basis. But, the real problem came in from the raw material between Q3 and Q2 where we have seen an extra burden of Rs 900 crore, which has resulted into a negative bottomline for Q3.

I am quite scared on the global operations and I don’t think there is any kind of relief coming in from the global operations. On a consolidated basis though  predications are showing a slight dip in the EBITDA margin, but I am quite scared about their global operations. I am not expecting any kind of relief. Raw material cost which was at 52.5% for Q3 is likely to get increased by about 100 bps in Q4.

Q: Manappuram General Finance is down close to about 5%, they will be announcing numbers today- are we expecting a negative surprise from there?

A: That is likely because if you see the share price movement Muthoot Finance has not given us any negative surprise, but Manappuram is likely to give. The market has been very apprehensive on the performance of this company because of regulatory actions and slow growth. Probably, the share price is indicating that we may see negative surprise post results.

Q: Anything on Jet Airways or Spicejet or a Kingfisher Airlines ?

A: The noise of FDI in airlines is hitting up and it is likely to happen in the next couple of weeks maximum next two to three weeks. So, that is a positive cue been taken by the market on all airline stocks. This positive view is likely to continue atleast for sometime maybe a rise of about 5-8% on the stock like Jet Airways and even Spicejet and Kingfisher Airlines can move up by about 10% plus in this next one week or so.  

In an interview to CNBC-TV18, Sudarshan Sukhani of s2analytics.com says that the relief rally for the market has come and gone in the past two days. “The original trend, which is the downtrend is asserting itself,” he said.

Indian benchmarks snapped a five day losing streak yesterday to end 0.5% higher. However, adverse news from around the globe this morning could put pressure on the indices again.

In this scenario, Sukhani advices traders to build on short positions during intraday rallies. “Today’s declines are not an opportunity to cover shorts,” he added.

If the market opens with a gap down today, Sukhani believes the Nifty will race towards the 4800 level or lower.

Below is an edited transcript of his interview with Udayan Mukherjee and Mitali Mukherjee. Also watch the accompanying video.

Q: Indications are that we have got a sharp cut coming this morning. How would you approach it as a trader? Is there any opportunity for a bounce back or is the range for the market opening up again?

A: You described it nicely; the range is opening up again. The bounce back has already come. The first day was mild and yesterday we had a decent bounce back, so we are done with that bounce back.

Now, the original trend, which is the downtrend is asserting itself. Today’s declines are not an opportunity to cover shorts. I would say that intraday rallies should be used to build more short positions. Nothing is certain in the market, but a gap down is a sign that we are now racing towards 4,800 or lower.

Q: Exide Industries is in your sell list?

A: Exide has been a big disappointment. It was one of those concept stocks. It’s been falling consistently from Rs 150, its not having any up day. The Rs 120 has also breached. It now seems that Exide like other midcap peers is going to into double digit. At this point the target of Rs 112-110 seems visible. I think today should be used to build-up short positions. Exide qualifies nicely in that area.

Q: Aditya Birla Nuvo is a chart that you do not like?

A: I do not like it because it was a good stock and it made money on the long side. It is cracking now. I have discussed this before that so many midcap stocks were standing at support levels and they have cracked below it. There is a message here. Aditya Birla Nuvo is now cracking. There is a modest downside target of Rs 770. I would not be overly bearish on it but for day traders ,even this is good enough.

Q: How would you trade Cipla ?

A: Cipla is a buy. It is a very good chart, its a bullish pattern and it’s breaking out. I think the breakouts are getting tempered because the broad market is not helping but even assuming that we open 60 points lower, go down, any dip in Cipla should be use to accumulate, add and initiate long positions. This is a positional trade.

Q: Tata Motors (DVR) is a buy today?

A: Apart from whatever is going on fundamentally, the DVR chart suggests that Rs 148-149, it came to a strong support level and from there it saw a bounce. I would be a buyer in Tata Motors’differential voting rights (DVR) even if it falls below Rs 148 today because that is a strong support. This is a buy on dip stock.

Q: Gujarat Mineral Development Corporation (GMDC) is a sell in your book today?

A: The stock cracked below Rs 175 support. All the significant support levels in midcap stocks have been broken on the downside. The targets are so low that we cannot discuss. An immediate target of Rs 158-155 is visible and that is good enough for short-term traders and for swing traders. GMDC’s targets are Rs 110 after the breakdown.

Q: You have got a bullish recommendation on Alstom Projects ?

A: Yes, because everything is so bearish that one starts searching for something better. Alstom Projects has a support level at Rs 340. This one hasn’t broken unlike most of the others as we discussed, so I am just hoping that the support will hold. This is not a stock that one should rush on a down day like this. But if the support is holding then we will be buying at the lows. One has to wait till the close to find its holding.

Satish Chander, director general of Fertilizer Association of India (FAI), says that till now there is no decision to increase the price of urea, there are only proposals which are under consideration. He also says that the total subsidy stands at Rs 80,000 crore.

Below is the edited transcript of his interview to CNBC-TV18. Also watch the accompanying video.

Q: What impact will 10% hike in urea prices would have when it comes into effect and which companies would get impacted?

A: Till now, there is no decision to increase the price of urea, there are only proposals which are under consideration. If the MRP is increased by 10% the subsidy will come down to that extent. As far as the companies are concerned, they don’t have any bearing on companies.

Q: What are your plans to reduce the current fertilizer subsidy of Rs 60,000 crore in FY13?

A: As per my estimate the total subsidy stands at Rs 80,000 crore.  We consume 58 tonne of urea and the excess we import, if the import prices are higher then the subsidy burden also goes up to similar extent. We are pleading the government to bring reforms in this sector and we would be happy that the subsidy is not rooted through fertilizer industry.

The farmer needs to be helped and direct subsidy can be given and this is what the government policy states. A committee is also working on the same policy direction of the government.

We are pleading with the government to introduce NBS where the subsidy is fixed and any increase in the cost of production is realised through the farmer’s price. So there is no increase in the subsidy once it is fixed under NBS and any increase in cost of production will be realized through higher MRP from the farmer.

Q: Do you think urea price hike is likely anytime soon and also what kind of savings will come in, in terms of a subsidy if 10% urea price hike comes about?

A: The price hike may be a token and a nominal hike. The government needs to take decision on price hike and as a country we should decide as to how much subsidy should be there.

Due to the volatile environment around the globe and in India, Dilip Bhat of Prabhudas Lilladher expects the Nifty to fall to 4500 levels by December.

In an interview to CNBC-TV18, Bhat said “There could be some bear market rallies, but by and large I think it will be a bearish outlook.” He further adds that investors should be picky while investing in equities over the next 8-12 months.

For the near-term, Bhat says hopes of a pullback rally are evaporating. “In case there is a rally, I think we all would look for when to get out, that would be at the topmost in the mind,” he added.

Below is an edited transcript of his interview with Udayan Mukherjee and Mitali Mukherjee. Also watch the accompanying video.

Q: Haven’t had too much luck in terms of a recovery barring yesterday’s small pullback. What’s your sense of where this market is breaking down to in terms of levels?

A: I think we can see that hopes are fast evaporating of any rally which a lot of people, including me, were expecting. In case there is a rally, I think we all would look for when to get out, that would be at the topmost in the mind.

On a longer term perspective, the things are unfolding, whether it is Greece, Europe or even India where the things are looking pretty muted, I think it’s going to be a tough time for the market. I think the market will probably continue to languish around these levels.

On the lower side, by December or something we can see a level of 4500. There could be some bear market rallies, but by and large I think it will be a bearish outlook. It will be kind of a pick and choose market which possibly will continue for next 8-12 months.

Q: From infrastructure the only that’s seen a positive response is L&T . Any thoughts on that stock and how are you guys approaching it?

A: Well as far as L&T is concerned, it will be largely determined by the extent of order inflows that they will get in. If they are expecting around 15% growth, I fear that it is on the optimistic side. It will be very difficult to meet unless they are banking on the overseas orders, which perhaps then can be possible. But given the state of the things, I think that looks a bit difficult.

I think we will probably continue to have very muted order inflow numbers even for the current year. Maybe the turnover and the execution would be good, so the bottom-line growth could be around 18-20% for FY12-13. So from the current level, I would still lookout for time to buy and not be in a hurry to really rush and buy around the current levels.

In an interview with CNBC-TV18, portfolio manager PN Vijay, spoke about his reading of the market condition and the road ahead.

Below is an edited transcript of Vijay’s interview on CNBC-TV18. Also watch the attached videos.

Q: Do you think this is just a small pullback session? Do you think the trend is still intact on the downward side or perhaps there is some sort of a near-term base for our markets?

A: Today, we have seen a lot of short covering because the markets are heavily oversold. I have not seen this amount of short selling across all futures in the last two-years. A large portion of this could be bears moving out of the market.

On the other hand, we are in a very tough situation. In the sense that if Hollande flies over, an hour after his swearing in, to Berlin for dinner with Merkel and if they make any positive statement with the word “growth” put into it fairly frequently, there could be a huge short covering of the euro. It has been one of the most shorted in the last few days by currency traders.

So, you could see a sudden move up if there is a perception that Europe is slowing moving away from fiscal compact to a growth compact because that is what is driving markets; everything is incidental. If the risk aversion in Europe comes down a little bit, India will get a fair share of that upside.

Q: Are people interested in value buying at all at this stage?

A: People are not buying value now. You don’t buy FMCG and pharma the way people are buying if they are looking at value. You go out and buy Bank of Baroda and ICICI Bank and Tata Steel if you want value. It is difficult to say because India is such a trader’s market.

There is, of course, a long-term trend based on economic considerations but the volatility due to trader activity and media activity is so high that we have to live with a lot of volatility. So, when you say two months–two months is not a long time for a wealth manager, but it’s a huge time for traders.

My own sense is that it will be less than two months. If the monsoon is okay and Europe gets resolved in some form, these are very nice levels–4900-4850 on the Nifty–to build good portfolios. But the risk trade has to come back and I would imagine the risk trade may come back in about say three-four weeks, once people see some light at the end of the tunnel in Europe and equally importantly a QE3 from Bernanke in the US where also the economy seems to be getting a bit softer.

Q: In the infrastructure lot there are a slew of disappointments that we have seen in terms of earnings. What would you do the infrastructure stocks now? Would you avoid them completely or is there any potential in this sector?

A: One won’t avoid them completely. One has to pick and choose because the valuations are so interesting. The obvious call is Larsen and Toubro. Though the results were not so great, the outlook given by the company was extremely positive and the order execution appeared to be on course. So that stands by itself and I guess everybody would say that.

The other interesting ones are those, which have a toll approach and a revenue approach, rather than developmental approach. IL&FS Transportation is a great stock given the fact that they have some very profitable NHAI contracts and they have tolling etc.

After the chairman is cleared of these charges, IRB Infra, it has been beaten down so much. So infrastructure one is going for those stocks, which are getting NHAI contracts, with a caveat that the debt levels should be low because if the debt levels are low then the orders translate directly into huge profits. There could be a remarkable turnaround in the bottom-line next few quarters. One has to pick and choose.

Q: Do you expect the pressure on asset quality for PSU banks continuing next quarter as well?

A: I don’t expect the asset quality to deteriorate because of two reasons. One, I made a sample of eight PSU banks, which have reported numbers–SBI is the big one left–and there we expect that the P&L should be good.

PNB and Bank of Baroda were bit of howlers. On the other hand Canara Bank, Bank of India came out with some very strong asset quality numbers. So like curate’s egg it’s good in parts. Also, one thing we are forgetting is that they are going into system based NPA recognition.

The system based is much more scientific and while it did hit them in the previous quarters, including the last quarter, the systems based would work in their favour going forward.

I don’t expect the asset quality to deteriorate. I don’t expect any great improvement either. I would say that would seize to be a worry probably in Q2 and Q3 of 2012-13.