Market Outlook

October 9, 2012

Dealers Diary
The Indian markets are expected to open in the green, tracking a positive opening in SGX Nifty and healthy gains in most of the Asian Markets. The SGX Nifty is trading higher by 0.7% in the early trade. The US markets finished lower on Monday due to renewed concerns about global Economy. The World Bank has cut its 2012 growth estimates for developing economies in East Asia region to 7.2% from 7.6% projected in May, which led to weakness on Wall Street. Further the markets also had an eye on European finance ministers meeting to discuss the debt crisis of the region. Meanwhile key benchmark indices in India fell for a second consecutive trading session in a row, on fears about global growth, euro-zone debt worries and dimming hopes of further US quantitative easing. The market would keenly observe the IIP numbers for the month of August to be declared later in the week.

Domestic Indices

Chg (%) (1.2) (1.2) (0.4) (0.2) 1.2 (1.1) (1.2) (1.3) (1.0) (2.8) (1.4) Chg (%)

(Pts) (70.9) (29.4) (11.6) 88.9 (81.4)

(Close)

BSE Sensex Nifty MID CAP SMALL CAP BSE HC BSE PSU BANKEX AUTO METAL OIL & GAS BSE IT
Global Indices

(229.5) 18,709

5,676 6,649 7,134 7,516 7,446

(161.1) 13,051 (132.0) 10,361 (107.6) 10,499 (245.3) (82.9) (Pts)

8,607 5,828
(Close)

Dow Jones NASDAQ FTSE Nikkei Hang Seng Straits Times Shanghai Com
Indian ADRs

(0.2) (0.8) (0.5) 0.4 (1.0) (0.6)

Chg (%)

(26.5) 13,584 (23.8) (29.3) 38.7 (31.2) (11.7)

(Pts)

Markets Today
The trend deciding level for the day is 18,788 / 5,698 levels. If NIFTY trades above this level during the first half-an-hour of trade then we may witness a further rally up to 18,891 19,072 / 5,730 5,784 levels. However, if NIFTY trades below 18,788 / 5,698 levels for the first half-an-hour of trade then it may correct up to 18,606 18,503 / 5,644 5,612 levels.
Indices SENSEX NIFTY S2 18,503 5,612 S1 18,606 5,644 PIVOT 18,788 5,698 R1 18,891 5,730 R2 19,072 5,784

3,112 5,842 8,863 3,077 2,074

(Close)

(0.9) (187.8) 20,825

INFY WIT IBN HDB

Advances / Declines

(1.8) (1.6) (1.7) (1.0)

(0.9) (0.1) (0.7) (0.4)

BSE

$47.9 $8.8 $40.7 $38.4

NSE

News Analysis
EGoM recommends one-time fee for spectrum above 4.4MHz Petrol Prices reduced by 56paise NMDC cuts prices by 2-11% for October
Refer detailed news analysis on the following page

Advances Declines Unchanged

1,644 1,248 151

664 841 80

Net Inflows (October 05, 2012)

` cr FII MFs Purch 6,394 762 Sales 2,386 782 Net 4,008 (20) MTD 26,036 (3,300) YTD 69,475 (10,697)

Volumes (` cr)

BSE NSE

2,459 11,860

FII Derivatives (October 08, 2012)

` cr Index Futures Stock Futures Purch 1,089 929 Sales 860 1,363 Net 229 (434) Open Interest 16,223 29,720

Gainers / Losers
Gainers Company
NHPC Sun Pharma Aurobindo Pharma Idea Cellular IFCI

Losers Company
DLF United Spirits Bajaj Finservice India Infoline Pantaloon Retl

Price (`)
21 709 143 85 31

chg (%)
3.9 3.7 3.6 3.6 3.5

Price (`)
224 1,182 860 63 204

chg (%)
(7.2) (6.3) (5.9) (5.2) (4.9)

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Market Outlook
October 9, 2012

EGoM recommends one-time fee for spectrum above 4.4MHz

EGoM on telecom has given the nod to a proposal to charge mobile phone carriers a one-time fee for their existing 2G airwave holdings based on a price to be determined by an upcoming auction. The move will negatively impact incumbent players such as Bharti Airtel, Vodafone that are not hit by a Supreme Court order to revoke permits in a scandal-tainted 2008 sale and are not required to bid in the auction. The ministerial panel has recommended to the cabinet that companies be asked to pay for airwaves beyond 4.4 MHz at the auction-determined price for the remaining validity of their licence periods. The cabinet has the final say on the fees. The one-time fee would be imposed from the day the Cabinet takes a decision on the matter. As per media reports , If there is no case or no action is going on against telecom companies for no fault on their part (in obtaining licence in 2008), then the amount (licence fee of `1,658Cr) will be refunded. The government will adjust this `1,658Cr against the final price of spectrum that companies, whose licences were cancelled, will have to pay at the end of the November auction of airwaves. We continue to remain neutral on overall telecom sector.

Petrol Prices reduced by 56paise

Petrol prices have been reduced prices by 56 paise/litre in Delhi (excluding State levies). The move comes on the back of favorable rupee movement and declining crude prices in the last month. Since Petrol is a deregulated commodity, there will not be any impact on the under-recoveries and hence we maintain our FY2013 under recovery target of `155,332cr. and maintain Neutral on GAIL and Accumulate on ONGC with a target price of `312

NMDC cuts prices by 2-11% for October

NMDC has decided to cut iron ore price by 2 to 11% for October. Going forward the company will be fixing the price on a monthly basis and not on a three month contract basis as followed earlier. The company had raised the prices by 8-13% in August. However we maintain our estimates and recommend Accumulate on NMDC with a target price of `214.

Bloomberg Consensus
IndusInd Bank - (10/10/2012)
Particulars (` cr) Net profit 2QFY13E 244 2QFY12 193 y-o-y (%) 26 1QFY13 236 q-o-q (%) 3

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Market Outlook
October 9, 2012

Economic and Political News

Finance minister rules out probe into Vadra-DLF business deals India, France sign agreement on sustainable urban development Government planning to build 10-15 greenfield airports

Corporate News
RIL scales down KG-D6 spend by almost US$3 bn Kalpataru bags orders worth `604cr Crisis on, but KingFisher starts accepting bookings from October 13
Source: Economic Times, Business Standard, Business Line, Financial Express, Mint

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