Market Outlook

India Research
September 14, 2011

Dealers Diary
The market surged in early trade, tracking higher Asian stocks. The market regained strength after trimming gains from intraday highs in morning trade. The market hit a fresh intraday high in mid-morning trade. The market surged to fresh intraday high in early afternoon trade. The Sensex came sharply off high in afternoon trade as European shares moved off highs after a firm start and as US index futures turned negative from positive. The market reversed its initial rally to hit two-week low in mid-afternoon trade as European shares fell and as US index futures slumped on fears that the Greek government may default on its debts. Volatility in European shares and US index futures triggered high volatility on the domestic bourses in late trade. The Sensex and Nifty ended with losses of 0.2% and 0.1%, respectively. The mid-cap and small-cap indices ended flat. Among the front runners, DLF, Jindal Steel, Bajaj Auto, Wipro and Infosys gained 1-2%, while Tata Motors, SBI, Wipro, Hindustan Unilever, Jaiprakash Asso and Bharti Airtel lost 1-5%. Among mid caps, SpiceJet, Madras Cements, Shree Cement, Aventis Pharma and SKS Microfinance gained 5-6%, while KGN Inds, GTL, Shriram City Uni, Tata Teleservices and GVK Power lost 4-5%.

Domestic Indices BSE Sensex Nifty MID CAP SMALL CAP BSE HC BSE PSU BANKEX AUTO METAL OIL & GAS BSE IT Global Indices Dow Jones NASDAQ FTSE Nikkei Hang Seng Straits Times Shanghai Com

Chg (%) (0.2) (0.1) 0.0 0.0 (0.5) (0.4) (0.4) (0.7) 0.2 0.4 0.9 Chg (%) 0.4 1.5 0.9 1.0 (4.2) (0.5) (1.1)

(Pts) (5.9) 2.0 1.0 (32.0) (26.2) (56.8) 31.4 44.7 (Pts) 37.1 44.6 80.9 (14.2) (26.5)

(Close) 4,941 6,319 7,169 5,925 7,518 8,481 8,510 4,833 (Close) 2,532 5,174 8,617 2,729 2,471

(34.3) 16,467

(47.9) 10,708 23.2 11,911

44.7 11,106

Markets Today
The trend deciding level for the day is 16,536/4,961 levels. If NIFTY trades above this level during the first half-an-hour of trade then we may witness a further rally up to 16,69816,928/5,0105,080 levels. However, if NIFTY trades below 16,536/4,961 levels for the first half-an-hour of trade then it may correct up to 16,30616,145/4,8914,842 levels.
Indices SENSEX NIFTY S2 16,145 4,842 S1 16,306 4,891 R1 16,698 5,010 R2 16,928 5,080

(836.1) 19,031

Indian ADRs Infosys Wipro ICICI Bank HDFC Bank Advances / Declines Advances Declines Unchanged

Chg (%) 1.2 1.1 (0.3) (0.1)

(Pts) 0.6 0.1 (0.1) (0.0) BSE 1,397 1,395 136

(Close) $48.1 $9.3 $36.8 $30.8 NSE 738 732 56

News Analysis
TCS and Felda Prodata sign strategic collaboration DLF to sell NTC land SpiceJet promoter to increase stake at 50% premium

Refer detailed news analysis on the following page

Net Inflows (September 12, 2011) ` cr Purch Sales FII MFs 1,645 344 2,424 438

Net (780) (94)

MTD 1,363 (849)

YTD 555 5,426

Volumes (` cr) BSE NSE 2,276 9,833

FII Derivatives (September 13, 2011) ` cr Index Futures Stock Futures Gainers / Losers Gainers Company Cairn India India Cements IRB Infra. Glaxo. Cons. Patni Computer Price (`) 289 71 162 2,370 283 chg (%) 5.8 4.4 3.7 3.5 3.1 Company Tata Motors Zee Entertainment United Breweries GVK Power Pipavav Shipyard Losers Price (`) 140 114 395 17 88 chg (%) (4.6) (3.9) (3.6) (3.5) (3.3) Sebi Registration No: INB 010996539
1

Purch 2,508 1,685

Sales 2,375 1,396

Net 133 289

Open Interest 17,975 28,430

Please refer to important disclosures at the end of this report

Market Outlook | India Research

TCS and Felda Prodata sign strategic collaboration

TCS and Felda Prodata Systems (Prodata) have signed an agreement to jointly develop and deliver strategic information technology services and solutions to the Malaysian market. Both the organisations will jointly identify opportunities to participate in tenders from government offices. This collaboration is the first between the two organisations to pool their expertise. This is expected to positively impact the IT industry both in the Malaysian and regional markets. Under this agreement, both organisations will jointly take forward their key IT initiatives in a timely, efficient and effective manner to service customers. They will also jointly develop and market IT solutions and services to local companies, Malaysian government-linked companies (GLCs) and global companies within Malaysia. TCS and Prodata will share their technology expertise in areas including open source solutions, SAP-ERP application, application development and maintenance, shared services/business process outsourcing, infrastructure services and business intelligence. We maintain our Buy rating on TCS with a target price of `1,368.

DLF to sell NTC land

DLF, which recently sold 28 acres of land in Gurgaon for `440cr, is further selling its assets to reduce its debt, which stood at `21,524cr at the end of 1QFY2012. The company is expected to sell its 17.5 acres in NTC mill land in central Mumbai, which is estimated to be around `3,000cr`4,000cr and could be one of the biggest land deals in the country. The company is also seeking approval from the Board of Approvals for SEZs to sell the shares of its IT SEZ in Pune. DLF, which has a 70% stake in the SEZ, is in talks with PE players to sell the land, which is estimated to be around `900cr. If these deals go through, the company could significantly reduce its mounting debt, which has been one of the major concerns for the company. We continue to remain Neutral on the stock and will wait for further clarification on the deals.

SpiceJet promoter to increase stake at 50% premium

SpiceJet has decided to issue 35,977,619 equity shares at an average price of `36/share to Mr. Kalanithi Maran on preferential basis. This shows the underlying confidence that the promoter has in the company given the current market scenario. The promoters stake will increase to 43% post dilution. The company will be able to raise nearly `130cr from the equity dilution, which will help it in the current market, where the company is losing money because of artificial low pricing and high fuel cost. The company reported loss of `72cr in 1QFY2012 and is expected to report loss in 2QFY2012E also. We continue to remain Neutral on the stock.

September 14, 2011

Market Outlook | India Research

Economic and Political News

IEA cuts oil demand growth forecasts for 2011 and 2012 Government will meet `40,000cr disinvestment goal: Finance Ministry Competition policy will tame inflation: Corporate Affairs Ministry

Corporate News
BPCL plans to raise US$400mn to fund FY2012 capital expenditure HFCs face tighter regulations as NHB raises provisioning requirements NMDC to submit bid for 50% stake in Australian firm for ~`200cr Bajaj Hindusthan to raise `1,644cr through rights issue
Source: Economic Times, Business Standard, Business Line, Financial Express, Mint

September 14, 2011

Market Outlook | India Research

Research Team Tel: 022-3935 7800 E-mail: research@angelbroking.com Website: www.angelbroking.com

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September 14, 2011