Market Outlook

India Research
March 28, 2012

Dealers Diary
The Indian markets are expected to open flat to negative today tracing negative opening in most of the Asian bourses. Domestic markets gained ground in volatile trading session yesterday, as firm global cues amid signs that easy monetary policy would remain in place in the U.S. for some time underpinned sentiment. The upward move gained momentum in the afternoon session after media reports said that the government is not keen on chasing participatory notes, or derivative products that allow foreign investors to invest into Indian equities via tax havens like Mauritius under the new General Anti-Avoidance Rules targeting tax avoidance. Most of the Asian stocks also ended higher yesterday. Globally, most of the U.S. and European markets ended lower yesterday showing a lack of direction throughout much of the session. Disappointing economic data from the U.S. also weighed on the markets as the Conference Boards confidence index fell to 70.2 in March from a revised 71.6 reading for February. A separate report from S&P showed a continued drop in U.S. home prices in the month of January, with prices index falling by an annual rate of 3.8% compared to 4.1% drop in December. The markets will now closely watch out for U.S. GDP data for 4QCY2011 which is due to be released tomorrow.

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 (%)

(Pts)

(Close)

1.2 1.1 (0.1) (0.2) 0.6 0.3 0.9 0.5 1.2 0.5 1.0
Chg (%)

204.6 17,257 58.9 (4.1) (11.3) 41.1 18.5 45.5 38.1 60.8
(Pts)

5,243 6,245 6,522 6,433 7,253 9,906 7,948 6,072

(Close)

107.5 11,678 134.3 11,112

(0.3) (0.1) (0.6) 2.4 1.8 1.5 (0.2)

Chg (%)

(43.9) 13,198 (2.2) (33.2) 3,120 5,870

Markets Today
The trend deciding level for the day is 17, 228/5,235 levels. If NIFTY trades above this level during the first half-an-hour of trade then we may witness a further rally up to 17,396 17,534/5,286 5,329 levels. However, if NIFTY trades below 17, 228/5,235 levels for the first half-an-hour of trade then it may correct up to 17,090 16,923/5,193 5,142 levels.
Indices SENSEX NIFTY S2 16,923 5,142 S1 17,090 5,193 PIVOT 17,228 5,235 R1 17,396 5,286 R2 17,534 5,329

236.9 10,255 378.1 21,047 44.4 (3.4)

(Pts)

3,019 2,347
(Close)

Indian ADRs

INFY WIT IBN HDB

Advances / Declines Advances Declines Unchanged

0.3 0.3 (0.7) 1.5

0.2 0.0 (0.3) 0.5

BSE

$57.6 $10.7 $34.9 $34.1

NSE

News Analysis
L&T bags order worth `1,700cr ITNL bags road BOT project worth `651cr Sadbhav Engineering bags `1,220cr project from NHAI Jagran group closes in on Nai Dunia buy
Refer detailed news analysis on the following page

1,189 1,707 121

612 865 80

Net Inflows (March 26, 2012)

` cr FII MFs Purch 3,990 373 Sales 4,084 547 Net (94) (174) MTD 8,702 (1,254) YTD 45,000 (5,281)
Volumes (` cr) BSE NSE

2,906 13,132

FII Derivatives (March 27, 2012)

` cr
Index Futures Stock Futures

Purch 5,827 7,596

Sales 6,383 6,923

Net (556) 673

Open Interest 19,590 29,721

Gainers / Losers
Gainers Company
India Cements GMR Infra Sintex Inds Glaxosmithkl Cons DLF

Losers Company
Manappuram Fin. Wockhardt Gitanjali Gems Indiabulls Fin India Sec

Price (`)
116 31 85 2,670 197

chg (%)
7.1 4.8 4.6 4.3 4.3

Price (`)
30 558 351 212 57

chg (%)
(7.4) (6.5) (5.0) (4.6) (3.8)

Please refer to important disclosures at the end of this report

Sebi Registration No: INB 010996539

Market Outlook | India Research

L&T bags order worth `1,700cr

Larsen & Toubro (L&T) Metallurgical and Material Handling, part of L&T Construction, has won a contract worth `1,700cr from Tata Steel for its new 6mn tonne per annum steel plant being set up at Kalinganagar in Odisha. As part of the greenfield steel plant, L&T is executing a slew of projects, like blast furnace, sinter plant, coke oven, balance of plant for steel melt shop, hot strip mill, utilities and construction works for other areas. At the CMP of `1,303, the stock is trading at PE of 18.4x FY2013E earnings, which is below the historical trading multiple for L&T. We have used the SOTP methodology to value the company to capture all its business initiatives and investments/stakes in different businesses. Ascribing separate values to its parent business on P/E basis and investments in subsidiaries on P/E, P/BV and mcap basis, our target price works out to `1,607, which provides 23.3% upside from current levels. Hence, we maintain our Buy recommendation on the stock.

ITNL bags road BOT project worth `651cr

IL&FS Transportation Networks Ltd. (ITNL) has bagged a road project worth `650.8cr from Public Works Department, Rajasthan. The project involves development and operation of Sikar-Bikaner section in Rajasthan. The project, under PPP model, would be executed on DBFOT basis and involves grant of `247.3cr. The project is on toll basis with a concession period of 25 years including construction period of two years. ITNL was the sole bidder for the project. We recommend Buy on the stock with an SOTP target price of `235.

Sadbhav Engineering bags `1,220cr project from NHAI

Sadbhav Engineering (SEL) has bagged a `1,220cr order from NHAI four-laning of the Solapur-Bijapur section of NH-13. The project would executed on BOT (Toll) basis, under NHDP Phase-III. The concession period of project is 20 years from the appointed date. We maintain our positive view on stock; however, our target price is currently under review. for be the the

March 28, 2012

Market Outlook | India Research

Jagran group closes in on Nai Dunia buy

According to news reports, the Jagran group that publishes the countrys most widely read Hindi newspaper, Dainik Jagran, is close to buying out Nai Dunia, the Indore-based Hindi daily promoted by Vinay Chhajlani. The deal size is expected to be around `300cr. According to the Indian Readership Survey (IRS) Q4 report, Dainik Jagran has average issue readership of 16.41mn, making it the most read publication across the country, while Nai Dunia has average readership of 1.64mn. Currently the group publishes two editions in Madhya Pradesh and if the deal goes through Jagran would get an avenue to expand in Central India and particularly in Madhya Pradesh, where Nai Dunia is second largest read daily. At CMP, the stock trades at price to earnings multiple of 13.4x FY2013E. We maintain a Buy on the stock with a Target Price of `137.

Economic and Political News

65% of governments borrowing to be in 1HFY2013 No subsidy for digitalization but implementation on track: Government `2.73lakh cr of I-T dues locked up in disputes: Government

Corporate News
REpower signs contract for supplying 54 turbines in Germany Patni gets Rio Tinto outsourcing order Gammon Infra bags `935cr road project from NHA
Source: Economic Times, Business Standard, Business Line, Financial Express, Mint

March 28, 2012

Market Outlook | India Research

Research Team Tel: 022 - 39357800

Source: Economic Times, Business Standard, Business Line, Financial Express, Mint

E-mail: research@angelbroking.com

Website: www.angelbroking.com

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March 28, 2012