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Nifty hovers around 7850; pharma, tech slip; cap goods gain

10:00

The News International Team

10:55am KEC in Focus

Investors lapped up shares of KEC International on Wednesday after the infrastructure EPC major received new orders worth Rs 1,029 crore in its transmission and distribution, cables, and renewable businesses. The stock gained over 2 percent.

In transmission and distribution segment, the company has secured orders worth Rs 746 crore from Power Grid in India, Zesco in Zambia and SAE Towers in America.

“In cable business, the company received orders for the supply of power and telecom cables. The total value of these orders is Rs 273 crore,” said the company in its filing to BSE, adding it has secured order worth Rs 10 crore in solar space.

10:30am SBI on buyers’ radar

Shares of State Bank of India gained over a percent as brokerage house CLSA said India’s largest lender is its top pick among PSU banks given its strong deposit franchise, well capitalised balance sheet and focus on profitability.

The brokerage maintains buy on the stock with a target price of Rs 3,160 based on 1.5x September-16 consolidated adjusted price-to-book.

CLSA said interactions with SBI indicated that it will focus on low-risk segments like large corporate and retail segment for loan growth. “While this can put some pressure on net interest margins (NIMs), recent cut in deposit rates can help to manage the impact. Fee growth can improve as cross-sell targets are knitted into staff’s appraisals; this will add to the benefits from cost controls,” it added.

According to the report, asset quality pressures can continue in the near-term, but SBI will benefit from improving economy and tighter underwriting standards.

10:00am Market Check

The market remained rangebound at around 7850 on the Nifty after seeing big fall in previous session. The index declined 8.05 points to 7844.35 while the Sensex was down 10.41 points to 26261.56. Technology and healthcare stocks were under pressure while capital goods, FMCG, power and banks stocks gained.

About 994 shares have advanced, 905 shares declined, and 84 shares are unchanged.
 
Adrian Mowat, Chief Asian & Emerging Equity Strategist, JPMorgan says India looks extremely favourable moving in FY15, and believes it would be an outperformer in FY16.

According to him, the new government has done a lot of good things at an executive level and the house is particularly excited about the proposal of managing food inflation.

However, one would be keenly watching for government’s decision on energy prices like coal, gas which would impact power generation. The house is also eagerly awaiting announcement of diesel deregulation, he said.

Tech Mahindra topped the selling list, falling 4.4 percent followed by Infosys, Dr Reddy’s Labs, Cipla, Wipro and TCS with 2-3 percent loss. However, L&T, BHEL, SBI, ONGC, ITC and NTPC gained more than a percent.

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