• Indian stock market and companies daily report (October 01, 2015, Thursday)

    Indian markets are expected to open in green tracking the SGX Nifty and the Asian cues.

    The U.S. Stocks ended in green led partly by reaction to rallies by stocks overseas, with most markets across Europe and the Asia-Pacific region seeing considerable strength on the day and stronger than expected private sector job growth in the month of September.

    The European markets also ended the session in positive led by mining stocks which bounced back after Glencore, which had a few turbulent sessions of late, reassured investors that it has taken proactive steps to position the company to withstand current commodity market conditions and USA private sector employment growth also provided support to the markets.

    Indian shares rose for a second day, with a dovish outlook by the RBI, a firming trend in rupee and positive global cues. News that India has surpassed U.S. and China as the biggest Foreign Direct Investment (FDI) destination in the first half of 2015 and a significant improvement in India's ranking in this year's Global Competitiveness Index also raised hopes that the Indian economy will likely expand by a faster clip this year than last year's 7.3 percent.

    HCL Technologies- Pre-Quarter Guidance for 1QFY2016

    For 1QFY2016, the company has given a pre-quarter guidance indicating that revenues to be reported in US dollar to have an adverse impact of 80bps on account of sharp depreciation of multiple currencies against US dollar. The company expects tepid revenue growth in the first quarter on account of 1) adverse currency impact, b) a client specific issue, and c) skewness in revenue growth due to transition timelines for complex engagements in infrastructure services.

    In one of the multi-million custom application development project being executed for one of the customers certain differences have arisen on with the customer. The company reserved up to US$20mn as a matter of prudence. These factors will have a significant impact on the overall performance of the company in 1QFY2016. Though currency is a quarterly impact, the client specific issues can have an impact for the FY2016 numbers. Though exact impact is not ascertained, as of now hence we are not changing our numbers and will wait for more clarity on the issue. However, we believe that the worst case scenario, the impact would be around 5-6% on EPS in FY2016. We currently maintain our buy with a price target of '1,132.

    Glaxo Pharmaceuticals-Update

    Company has completed its transaction with Novartis Healthcare Pvt. Ltd. ('Novartis India') on September 30, 2015 whereby the Company has acquired Novartis' vaccines business and divested its marketed oncology portfolio to Novartis India. This follows a global transaction between GlaxoSmithKline plc, UK (GSK) and Novartis AG, Switzerland (Novartis) which was completed in March 201 5 on the same basis.

    The acquisition of the vaccines business of Novartis provides GSK an exciting opportunity to build an even stronger, sustainable global vaccines business. The transaction will enhance GSK's vaccines portfolio and bring together its expertise in virology, bacterial infection and technological platforms to deliver a reliable supply of high quality vaccines. We remain neutral on the stock.

    Economic and Political News

    - Apr-Aug fiscal deficit at 66.5% of Budget estimate

    - India's August core industries output jumps 2.6%

    - India Ratings maintains negative outlook on the toll roads sector

    Corporate News

    - SBI, Bank of Baroda allot shares to government for capital infusion

    - Reliance Communications to partner Reliance Jio in 4G services

    - Bharat Electronics to set up new facility in Andhra

    Contributed by Angel Broking
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