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Reports India

Indian stock market and companies daily report (February 20, 2014, Thursday)

February 20, 2014, Thursday, 05:37 GMT | 00:37 EST | 10:07 IST | 12:37 SGT
Contributed by Angel Broking


Indian Markets are expected to open in negative tracking negative opening in the SGX Nifty which is down by ~0.7% and similar negative opening in other Asian indices.

U.S. Markets closed lower on Wednesday amidst the release of minutes from the recently held Federal Reserve meeting which showed most Fed members are determined to taper the central bank's bond buying program. The Commerce Dept, showed negative housing data and US producer prices rose for a second straight month in January; which weighed on the market throughout the trading. Meanwhile, European markets finished the day in positive after going in the negative territory in early trade.

The Indian markets closed higher on Wednesday, after a subdued start, on the back of the positive interim budget and further stable outlook on India by Moody's.


Markets Today

The trend deciding level for the day is 20,701 / 6,146 levels. If NIFTY trades above this level during the first half-an-hour of trade then we may witness a further rally up to 20,772 - 20,822 / 6,167 - 6,181 levels. However, if NIFTY trades below 20,701/ 6,146 levels for the first half-an-hour of trade then it may correct 20,652 - 20,580 / 6,132 - 6,112 levels.


Automakers announce price cuts to pass on the excise duty cut benefits

Automakers have announced price cuts in the range of Rs.8,500 - Rs.135,000 across the products with immediate effect, following reduction in excise duty by the Finance Minister. The Finance Minister in the Interim Budget has reduced the excise duty by 3-6% to provide respite to the sector which has been experiencing significant slowdown in sales. Most of the auto manufacturers have decided to pass on the entire benefits to the consumers. The table below highlights the quantum of price cuts announced by the companies so far.

The price cuts announced by the companies are on the expected lines and are sentimentally positive from the demand perspective. However, we note that automakers might have to take some hit on the existing dealer inventory (around 4-6 weeks across companies) which would be felt in 4QFY2014. We maintain our Buy rating on Tata Motors (target price - Rs.451) and Accumulate rating on Mahindra & Mahindra (target price - Rs.1,061). We also maintain our Neutral rating on Maruti Suzuki.


Ranbaxy Lab settles with the New York Attorney General

The New York Attorney General and the U.S. units of Ranbaxy Laboratories and Teva Pharmaceutical Industries have settled claims that an agreement between the two drugmakers unlawfully restricted competition. Under the terms of the settlement, the two generic drug makers will end a 2010 agreement of not challenging each other's rights to sell certain drugs exclusively in the United States. Teva and Ranbaxy will pay the New York state $300,000 and have agreed to refrain from similar agreements in the future. The settlement concludes an investigation into the agreement relating to atorvastatin calcium, the generic version of Pfizer Inc's Lipitor - a drug used to treat high cholesterol. The atorvastatin agreement related to the sale of only one drug, but by including "nochallenge" commitments as part of that agreement, the companies shielded dozens of their drugs from legal and regulatory challenges.We remain neutral on the stock.


Economic and Political News

- India's FDI inflows unchanged at $1.1 bn in December: DIPP

- Govt orders CNG retailers to provide cost-break up

- HC halts implementation of AAP govt.'s waiver on power bills

- Telecom M&A guidelines within 10 days, says Telecom Secretary

- Indian Readership Survey 2013 in abeyance till March 31


Corporate News

- NMDC settles wages for non-executives

- Hero MotoCorp to reduce prices up to Rs.4,500

- Elder Pharma appoints Deloitte to restructure business and brands