Morning Notes

05.06.2012

R. Wadiwala

Securities Pvt Ltd Commodities Pvt Ltd

Member Broker: NSE, BSE, MCX & NSEL || DP: CDSL || PMS || Mutual Fund

Euro Advances Before G-7 Officials Discuss Debt Crisis The euro rose for a third day before finance ministers and central bank governors from the Group of Seven countries hold a call today to discuss Europes debt crisis. The yen and dollar weakened against most of their major counterparts as Asian stocks rallied, sapping demand for lower- yielding currencies. Australias dollar advanced ahead of an interestrate decision by the Reserve Bank. Policy makers may lower benchmark borrowing costs for a second consecutive meeting, according to a Bloomberg News survey of economists. The G-7 call is likely to touch on the ongoing euro debt crisis, said Lee Wai Tuck, a currency strategist at Forecast Pte in Singapore. Oil Gains a Second Day in New York as Stockpiles Decline Oil gained a second day in New York before a government report that may show crude stockpiles dropped for the first time in 11 weeks in the U.S., the worlds biggest consumer of the commodity. Futures advanced as much as 0.9 percent after rising for the first day in five yesterday. U.S. inventories probably slipped 1 million barrels last week as refineries increased gasoline output to meet peak summer consumption, according to the median estimate of nine analysts in a Bloomberg News survey before an Energy Department report tomorrow. Growth Slowdown Seen in U.S. as Recession Dodged: Economy The U.S. economy looks set to deliver a repeat performance in 2012: for the third straight year, it may suffer a swoon yet not slip into a recession. I dont think the slowdown will be any more consequential than the past two years, said John Ryding, a former Federal Reserve researcher who is chief economist at RDQ Economics LLC in New York. There are positives out there in the economy. Well avoid a recession. Household balance sheets are in better shape, with indebtedness down about $100 billion in the first quarter, according to the New York Fed.

KEY INDICES
Indian Markets
Index
S&P CNX NIFTY CNX NIFTY JUNIOR CNX 100 S&P CNX DEFTY S&P CNX 500 CNX MIDCAP NIFTY MIDCAP 50 SENSEX

Close
4848.15 9389.85 4746.95 3024.15 3850.80 6769.75 1942.35 15988.40

Pt. Chg.
+6.55 -50.50 +1.55 +28.25 -1.15 -15.60 -3.50 +23.24

Change %
0.14 -0.53 0.03 0.94 -0.03 -0.23 -0.18 0.15

Global Markets
Change (%) 0.01 0.46 -0.14 0.00 -1.19 0.14 0.60 0.93 0.97

Index S&P 500 NASDAQ DOW JONES FTSE DAX CAC 40 NIKKEI HANG SENG STRAITS TIMES

Close 1278.18 2760.01 12101.46 5260.19 5978.23 2954.49 8345.07 18354.81 2725.05

Global data recorded/updated last as on 05, June 7.30 a.m. IST

R. Wadiwala

NIFTY TOP GAINERS

Indian Markets Change (%) 3.40 3.21 3.18 3.17 Indian Markets

NIFTY TOP LOSERS

Change (%) -3.44 -3.22 -3.20 -3.06

Company LARSEN & TOU ONGC BK OF BARODA BHARAT PETRO

Close 1,173.50 254.05 679.10 716.50

Company TATA POWER GAIL JINDAL STEEL CAIRN IND

Close 89.90 319.60 416.25 307.10

MARKET SUMMARY
Shrugging off weak global cues, the key domestic benchmarks wiped out earlier losses and ended marginally higher on hopes that the Reserve Bank of India may deliver another rate cut very soon. The Reserve Bank of India Deputy Governor Subir Gokarn said that falling global oil prices, declining core inflation and decelerating growth may give more room for policy easing. The BSE SENSEX closed at 15,988.4, up by 23.24 points or by 0.15 per cent and the NSE Nifty ended at 4,848.15, up by 6.55 points or by 0.14 per cent. The BSE Sensex touched intraday high of 16,012.84 and intraday low of 15,748.98 The NSE Nifty touched intraday high of 4,858.3 and intraday low of 4,770.35. Meanwhile, the BSE MIDCAP closed at 5,809.23, down by 12.4 points or by 0.21 per cent, while the BSE SMLCAP ended at 6,180.43, down by 14.01 points or by 0.23 per cent. After a gap down opening, the key domestic benchmarks extended losses as weak global cues dampened sentiment. Fears over slowing global growth hit Asian stock markets. The benchmarks pared losses but remained in the negative terrain for almost the entire day. The benchmarks sprung a major surprise in late trade as rate cut hopes lifted the Sensex into the positive terrain. Out of the 30 Sensex stocks, there were 13 advances and 17 declines. The Market breadth, indicating the overall health of the market, was weak. On BSE out of total shares traded 3540, shares advanced were 1264 while 1479 shares declined and 797 were unchanged. The top gainers of the BSE Sensex pack were Larsen & Toubro Ltd. (Rs. 1173.40,+3.43%), Oil And Natural Gas Corporation Ltd. (Rs. 254.15,+3.19%), DLF Ltd. (Rs. 186.00,+1.97%), Tata Motors Ltd. (Rs. 228.75,+1.89%), Reliance Industries Ltd. (Rs. 692.65,+1.31%), among others. Asian markets tumbled on Monday as dismal US jobs data signaled a fading economic recovery in the worlds largest economy and dimmed the demand outlook for Asian exporters. The US economy added 69,000 workers in May 2012, the smallest increase in jobs in a year, while the jobless rate ticked up to 8.2 per cent in May 2012 from 8.1 per cent in April 2012.

R. Wadiwala

NEWS UPDATES
MACRO A massive capital raising is in the offing by Indian banks, as they are expected to raise over $30 billion (Rs 1.67 lakh crore) over the next five years to cater to their growth requirements and Basel-III implementation charges, says a report. According to global research firm Macquarie, significant equity dilution is expected over the next five years, as capital requirements for growth as well as transitioning towards Basel III are very high. Private sector banks are little better placed than public sector peers, as large chunk of this fund raising is expected to be mopped up by the PSU banks, with SBI group alone is likely to raise around $14 billion by fiscal year 2015. COMPANY JK Singhani Groups JK Paper will buy an equity stake in Myanmar's largest state-owned pulp mill an equity stake in Myanmar's largest state-owned pulp mill, reports said. JK Paper will initially operate the Thar Paung Paper and Pulp Mill and subsequently expand capacity and export pulp for its Indian operations. The deal would work well for the JK group as it would cost nearly Rs.4-5bn to build capacity similar to that of Thar Paung Mill in Myanmar. The mill produces about 70,000 tonnes of pulp and about 15,000 tonnes of paper annually. MAN Industries (India) Limited, one of the leading pipe manufacturing company has received new orders worth approx. Rs. 8bn from Midd ie East and domestic customers for supply of large dia meter pipes for Oil and Gas sector. Out of this, Company has received confirmed financial arrangements for partial quantity and for remaining quantity the financial arrangements will be made by the client in due course of time as the execution progresses. Take Solutions announced the successful implementation of Oracle Mobile Supply Chain Applications (MSCA) for a leading manufacturer of household goods. Take also implemented location control and cycle counting to provide additional visibility and inventory accuracy. Tree House Education & Accessories Limited has said that the Company has signed a Non-Binding Memorandum of Understanding with MT Educare Limited for the transfer of 'MT Educare Limited Pre - School Division' comprising of six company-operated centers located at Mumbai and Pune. The transactions will be closed after the usual duediligence. Maruti Suzuki India, the country`s largest carmaker, will invest Rs 40 billion to set up complete vehicle manufacturing facility for four-wheelers at its proposed Hansalpur unit in Gujarat. Government of Gujarat has allocated around 700 acres land to Maruti for this manufacturing facility. ``This land purchase by the company is in line with long term management view on expansion of its manufacturing facilities in India to meet future market demand. Based on the market demand the manufacturing facility near Mehsana will be added to the company`s existing manufacturing facilities at Gurgaon and Manesar in Haryana,`` the company said. MBL Infrastructures has received five orders worth Rs 2.06 billion in Metro Railway and Building Segments. The company has been awarded the order for construction of Sarai Station on Badarpur - Faridabad corridor of Delhi MRTS Phase - III by Delhi Metro Rail Corporation for Rs 415.7 million. This project marks the entry of MBL Infra in the Metro Rail. The company has also been awarded for construction of police line and residential quarters at Kondli Check Post, Delhi by RITES for Rs 406 million. State-owned Coal India has directed its subsidiaries to enter into fuel supply pacts with power units that are coming up between January 2012 and March 2015, bringing a respite to fuel-starved power companies.

R. Wadiwala

TECHNICAL ANALYSIS MOST ACTIVE STOCKS PIVOTAL GUIDANCE

Company NIFTY BANK NIFTY RELIANCE RCOM RELCAPITAL REL INFRA LT STER ICICIBANK SBIN TATASTEEL RPOWER TATAPOWER INFOSYSTCH BHEL ONGC ACC Lower 2 4804.43 9158.80 686.54 60.03 296.85 436.58 1152.57 87.16 785.61 2031.76 402.77 89.95 89.23 2369.89 205.46 251.81 1114.83 Lower 1 4823.08 9253.28 691.08 61.53 299.25 440.10 1165.92 88.87 791.92 2048.11 406.01 90.68 89.95 2388.96 207.12 253.83 1123.80 Axis 4849.73 9364.76 696.63 63.03 301.64 443.62 1175.27 90.09 798.24 2064.45 409.25 91.40 90.67 2408.02 208.77 255.86 1132.77 Higher 1 4861.54 9472.93 701.48 64.47 304.74 447.70 1189.46 91.22 803.77 2078.75 412.09 92.03 91.30 2424.70 210.22 257.63 1140.62 Higher 2 4881.58 9574.56 706.35 65.54 306.12 451.25 1199.92 92.33 804.76 2081.31 412.59 92.15 91.41 2427.68 210.47 257.95 1142.02

BULLISH ON SHORT TERM

ONGC RPOWER BUY AS QUICKDELIVERY FOR BTST/T+2 WITH TARGETS OF 258-260-262 SL 251 BUY AS QUICKDELIVERY FOR BTST/T+2 WITH TARGETS OF 93-94-95 SL 88

FII and DII Investments

FIIs Date *04 June June-2012 2012 Till Date Purchase 1492.85 8151.30 279404.80 Purchase 1102.98 865.54 50677.40 Sale 2129.99 8924.40 237033.50 Sale 656.75 660.04 56883.50
Inv (crs)

-637.14 -773.10 +42271.30

Inv (crs)

DIIs

Date *04 June June-2012 2012 Till Date * Provisional Data

+446.23 +205.50 -6205.70

R. Wadiwala

Following the MUTUAL FUNDS

UTI Dividend Yield G

Latest NAV: 28.91 (01/06/12) 52-Week High: 33.22 (21/02/12) 52-Week Low: 27.66 (20/12/11)

Top Holdings: As on 30 Apr.

Name of Holding
ICICI Bank SBI ITC Infosys NTPC

Top 5 Sectors
% Net Assets
6.97 5.87 4.90 4.35 3.65

Top 5 Sectors
Financial FMCG Technology FMCG Chemicals

% Net Assets
22.93 17.15 7.21 7.15 6.35

Top 3 Holding Company Details ICICI Bank

LTP: 780.30 PB Ratio: 1.49 PE Ratio: 13.94 Year to Date Return: 15.44 Other Funds That Own ICICI Bank
Fund name
Goldman Sachs Banking BeES ance Banking ETF UTI Banking Sector Reg Religare Banking

% Net Asset
28.52 27.10 23.86 22.16

Date
Mar 31, 2012 Apr 30, 2012 Apr 30, 2012 Apr 30, 2012

SBI
LTP: 2046.20 PB Ratio: 1.62 PE Ratio: 11.61 Year to Date Return: 26.35

Other Funds That Own SBI

Fund name
Kotak PSU Bank ETF Goldman Sachs PSU Bank BeES Goldman Sachs Banking BeES Reliance Banking ETF

% Net Asset
46.63 46.61 15.02 14.69

Date
Mar 31, 2012 Mar 31, 2012 Mar 31, 2012 Apr 30, 2012

ITC
LTP: 230.20 PB Ratio: 9.75 PE Ratio: 29.66 Year to Date Return: 14.36

Other Funds That Own ITC

Fund name
SBI Magnum FMCG ICICI Prudential FMCG Birla Sun Life Enhanced LIC Nomura MF Equity

% Net Asset
36.78 36.46 10.14 9.78

Date
Apr 30, 2012 Apr 30, 2012 Apr 30, 2012 Apr 30, 2012

R. Wadiwala

DERIVATIVES NOTES
Nifty June 2012 futures were at 4850.50, near spot closing of 4848.15. Turnover on NSE`s futures & options (F&O) segment rose to Rs 81583.31 crore from Rs 79781.44 crore on Friday, 1 June 2012. State Bank of India (SBI) June 2012 futures were at 2054.05, at a premium compared to spot closing of 2046. Tata Motors June 2012 futures were at 230.55, near spot closing of 229.30. ICICI Bank June 2012 futures were at 796.90, at a premium compared to spot closing of 792.90. In the cash market, the S&P CNX Nifty rose 6.55 points or 0.14% to settle at 4,848.15, its highest closing level since 31 May 2012.

Institutional Investment Trends

(in Crores) JUNE 04, 2012
% Change OI
9.20

BUY
1153.24

SELL
1501.07

Net Buy/Sell
-347.83

OIEoD
7801.25

INDEX FUTURES

STOCK FUTURES

1083.30

977.49

105.81

20002.20

1.25

Put Call Ratio Symbol INFY ABGSHIP BHEL NIFTY NIFTY LT CAIRN INDIACEM DLF NIFTY BANKNIFTY MINIFTY RELIANCE Expiry Date 26-Jul-12 28-Jun-12 26-Jul-12 30-Jun-16 31-Dec-15 26-Jul-12 26-Jul-12 28-Jun-12 26-Jul-12 26-Jul-12 26-Jul-12 26-Jul-12 26-Jul-12 Put 60750 44000 5000 1700 2050 7000 2000 8000 22000 7601400 2725 300 17000 Call 5750 6000 1000 350 500 2750 1000 4000 12000 4194750 1525 180 10500 Ratio 10.57 7.33 5.00 4.86 4.10 2.55 2.00 2.00 1.83 1.81 1.79 1.67 1.62

R. Wadiwala

DIVIDEND AND OTHER INFORMATION

Kabra Extrusion Technik Limited has informed the Exchange that the Board of Directors of the Company in their meeting held on May 29, 2012 have recommended a dividend of 20% i.e. Rs.1/- per share of Rs.5/- each. Sjvn Limited has informed the Exchange that the Board of Directors of the Company at its meeting held on May 28, 2012 have recommended dividend of Rs.0.94 per share (on face value of Rs.10/- each) (i.e. 9.4%) for the year 2011-12 subject to approval of Shareholders in the ensuing Annual General Meeting. Hitachi Home And Life Solutions (India) Limited has informed the Exchange that the Board of Directors of the Company at its meeting held on May 24, 2012 has recommended, subject to the approval of the shareholders at their ensuing annual general meeting, a dividend of Rs. 1.50 per equity share of Rs. 10/- each.

DISCLAIMER
This material is for your private information, and we are not soliciting any action based upon it. Transactions involving stocks and derivatives give rise to substantial risk and are not suitable for all investors. The material is based upon information that we consider reliable, but we do not represent that it is accurate or complete, and it should not be relied upon as such. Opinions expressed are our current opinions as of the date appearing on this material only.

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Email: contact@rwadiwala.com Website: www.rwsec.com

R. Wadiwala