The News International Team
10:55am Ashok Leyland in focus
Shares of Ashok Leyland gained a percent after brokerage house Bank of America Merrill Lynch (BoAML) raised target price on the stock by 9 percent to Rs 58 apiece. It expects stock to trade at previous peaks.
The brokerage raised forecast on higher EBITDA margin assumptions. It expects margin to rise to 10.3-10.8 percent over FY16-17 compared to 7.3 percent currently.
According to BoAML, stronger than anticipated sales mix has been favouring medium and heavy commercial vehicles (M&HCVs). “M&HCV recovery and market share gains will sustain,” the brokerage said.
Meanwhile, in October, its M&HCV sales grew by 43 percent to 5838 units compared to 4093 units in the year-ago period while light commercial vehicle sales declined 6 percent to 2537 units.
10:40am Crompton Greaves falls
Shares in Crompton Greaves fell about 5 percent, after a large block deal, amounting to 5.3 crore shares worth about Rs 900 crore was executed on the exchanges.
The deal, which amounted to 8.48 percent of the company’s outstanding shares, was reportedly executed by promoter Avantha Holdings, according to newspaper reports that had pre-empted the deal. Goldman Sachs was the banker to the deal, according to the reports.
Avantha, which holds a nearly 41 percent stake in Crompton, has been looking to pare its debt, and following the deal, its stake would come down to about 32 percent.
The promoter’s stake would fall to its 25 percent target, following an impending stock split.
10:20am Oil Update
Oil prices fell to four-year lows today as it appeared unlikely producer club OPEC would decide to cut output in support of prices at a meeting this week, and as increasing Chinese and US stocks boosted available supplies.
The Gulf producers within the Organization of the Petroleum Exporting Countries (OPEC) – Saudi Arabia, Kuwait, Qatar and the United Arab Emirates – said on Wednesday that they will not propose an output cut during the offical meeting on Thursday, reducing the likelihood of joint action by OPEC to prop up prices that have sunk by a third since June.
Benchmark Brent futures dropped over USD 1 in Asian morning trading today to a low of USD 76.28 a barrel, their lowest level since September 2010, and US crude was also down over USD 1 to a session low of USD 72.61 a barrel, reports Reuters.
10:00am Market Check
The market continued to consolidate on the expiry day of November derivative contracts. The Sensex rose 9.69 points to 28395.88 and the Nifty climbed 1.65 points to 8477.40.
The broader markets outperformed benchmarks with the BSE Midcap and Smallcap indices gaining 0.4 percent and 0.55 percent, respectively. Advancing shares outnumbered declining ones by a ratio of 1176 to 732 on the Bombay Stock Exchange.
Hindustan Unilever topped the buying list, rising 2 percent followed by Hindalco Industries, Infosys, Cipla, M&M, Punjab National Bank, Asian Paints and Power Grid Corporation with a percent gain.
However, Bharti Airtel, Zee Entertainment, ITC, Sesa Sterlite, DLF, Bajaj Auto and Tata Motors lost 0.5-1 percent.
Among midcaps, Gujarat State Petronet, Strides Arcolab, Jet Airways, Kalpataru Power and Gruh Finance rallied 3.5-5 percent while Crompton Greaves, Anant Raj, Jaypee Infratech, SRF and Trinity Trade lost 2-5 percent.