The Indian equity market once again closed in the green extending its winning streak to fourth straight session on Friday. The Nifty closed at highest level in 7 months registering its biggest weekly gain in nearly 3 months. Hopes of economic recovery, strength in rupee and prediction of above average monsoon lifted sentiments higher. Nifty closed with a gain of 87 points at 8,156 while Sensex ended with again of 287 points at 26,654.

On the global front, most of the Asian indices closed their day on a positive note. The Hong Kong’s Hang Seng ended higher by 0.88%, while Japan’s Nikkei 225 ended higher by 0.37%. The European indices also witnessed buying interest. The FTSE 100 is up 0.05%, France’s CAC 40 is up 0.06% and Germany’s DAX is up 0.9%. The rupee was trading at Rs 66.97 to the dollar at the time of writing.

SBI reported its results for the quarter ended March 2016. The net profits declined by 66% YoY to Rs 12.6 billion during the quarter. The decline was mainly because of higher provisioning on account of bad loans.

The gross non-performing assets (NPAs) increased to 6.5%, higher than 5.1% as reported in the preceding quarter. As an absolute number the gross NPAs increased by 35% to Rs 981.7 billion on a sequential basis.

Further, provisions increased by 65% to Rs 131.7 billion on a sequential basis. The provisions increased as the company set aside more money to provide for the bad loans. Net interest income (NII), the difference between the interest earned on loans and that spend on deposits, increased by 4% YoY to Rs 152.9 billion during the quarter.

SBI’s earnings have been hit in the March 2016 quarter on account of the clean-up exercise undertaken in line with RBI’s Asset Quality Review (AQR).

While the fallout of the same has resulted in higher provisions that have curtailed earnings, but it will also enable banks to quickly tide over the NPA crisis. A check on the asset quality will be the key things to watch out for going forward.

One shall note that the bank is going to merge its five associate banks, along with Bharatiya Mahila Bank, with itself. The bank recently announced that its board has given in-principle approval for the bank to discuss the possibility of acquiring its associate banks.

The stock of SBI closed higher by 9.4%.

Tata Steel recently reported its results for the fourth quarter ending March 31, 2016 (4QFY16). The company posted a year on year (YoY) decline of 12.4% in its consolidated revenues. Consolidated net loss of the company stood at Rs 33 billion as against Rs 57 billion in the corresponding quarter last year. Operating profits, however, remained strong. The company’s EBITDA (earnings before interest, tax, depreciation and amortization) came in at 23 billion, up by 44% on a YoY basis.

For the overall business, the company recorded steel deliveries of 6.94 million tonne (MT) during the quarter, down 1.6%.

Stock of Tata Steel closed the trading day up by 1.7%.

USDINR trade today trading up 16 paise at 67.01 per US dollar.

Out of 1,440 stocks traded on the NSE, 566 declined and 817 advanced today.

Top 5 Nifty Gainers: Coal India (4.34%), Tata Motors (1.95%), TCS (1.20%), Dr Reddys Lab (0.88%) and Axis Bank. (0.86%).

Top 5 Nifty Losers: BHEL (-2.89%), Lupin Ltd (-1.26%), ITC Ltd (-1.11%), ICICI Bank (-1.07%) and HDFC (-0.79%)

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Indian equity market once again sky rocketed extending its winning streak to third consecutive trading session. Sentiment got a fillip after index heavyweight L&T announced quarterly earning which was better than expected. The BSE Sensex opened above the psychologically 26,000 mark and went on to hit its highest level in almost 21 weeks. Sensex galloped approximately 1,100 points in last 2 trading session. Nifty closed with again of 135 points at 8,070 while Sensex ended with again of 486 points at 26,367.

Shares of Larsen & Toubro (L&T) surged more than 13% in today’s trade after the company reported 18.5% increase in consolidated net profit for the March quarter. Consolidated net profit in the three months ended March was up 18.5% YoY. Net sales rose 18.5% YoY.

About 54% of the total revenue in the quarter came from its infrastructure business (Subscription Required), in which revenue rose about 19% YoY. L&T garnered fresh orders worth Rs 1.3 trillion at the group level during the quarter, which constituted 62% of domestic and 32% of international orders. The consolidated order book of the group rose 7% to Rs 2.5 trillion for the year ended 31 March, with international orders constituting 28% of the total. Reportedly, the company is expecting 12-15% increase in revenues and a 15% growth in its order inflows for 2016-17. The company is looking at countries like Mozambique, Tunisia, Kenya, Uganda, Tanzania, Algeria, Botswana and Zimbabwe for its international business .

The engineering industry in India has grown tremendously over the years. But that growth has been marked by extreme volatility. Over the last eight years, the sector has seen numbers ranging from an output growth of 48% YoY in one year, to a contraction of 6% YoY in another. In our recent edition of the The 5 Minute Wrap Up Premium, we explain what factors to look for when picking an engineering stock (Subscription Required).

Engineering stocks finished on a strong note with L&T and Bharat Bijlee leading the gains.

Moving on to news from mining sector. According to an article in The Economic Times, Coal India is in talks with power companies in Bangladesh to supply coal. This is the first time Coal India will be exporting the fossil fuel on a commercial basis.

Reportedly, Coal India subsidiaries, Bharat Coking Coal and North Eastern Coalfields, plan to supply coal to Bangladesh. It is likely to be transported to Haldia port in West Bengal from where it could be forwarded through sea route to ports in Bangladesh. Coal India could not afford to export coal till last year because the fossil fuel was in short supply. The scenario changed last year when the company managed to pull up production at a considerable pace. Surplus stocks at pit head and slow lifting by power companies have prompted the company to explore the international market.

Apart from local Bangladeshi companies Coal India has also initiated talks with NTPC’s joint venture in Bangladesh, the 1,320 mw Maitree Project at Rampal in Bagerhat district. The project is a 50:50 JV between NTPC and the Bangladesh Power Development Board. Coal India finished the trading on a flat note.

USDINR trade today trading up 16 paise at 67.17 per US dollar.

Out of 1,812 stocks traded on the NSE, 1046 declined and 503 advanced today.

Top 5 Nifty Gainers: Sun Pharma (4.13%), Lupin Ltd (2.58%), Adani Ports & Sez (2.22%), SBI (1.82%) and Reliance Ind. (1.59%).

Top 5 Nifty Losers: ITC Ltd (-1.26%), L&T (-0.66%), NTPC (-0.60%), Tata Motors (-0.44%) and Axis Bank (-0.13%)

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The Indian indices shot up on Wednesday tracking a strong rally in equity markets across the globe. Sentiment got a boost after US home sales data supported the consensus view that the economy may be strong enough for the Federal Reserve to raise interest rates in the coming months. Besides, hopes of above normal rains in the upcoming monsoon season kept the sentiment high too. Nifty closed with again of 186 points at 7,935 while Sensex ended with again of 576 points at 25,881.

Buying activity was witnessed across majority of the pharma stocks with Indoco Remedies and Torrent Pharmaleading the gains. Shares of Dr. Reddy’s Laboratories finished the trading day on an optimistic note (up 1.3%) after it was reported that the company has entered into the branded consumer health arena through the acquisition of six over-the-counter (OTC) brands from Ducere Pharma, including Doan’s, Bufferins, Nupercainal Ointment, Cruex Nail Gel, Comtrex and Myoflex.

These legacy products enjoy strong brand equity built over several decades. The company is extremely excited to be entering the branded consumer health arena through these brands and embarking upon the next avenue of growth for our OTC business in the US.

Recently, the Indian Health Ministry announced a ban on 344 fixed dosage combination (FDC) drugs. The ban came after an expert committee’s recommendation. Pharma companies will have to suspend the manufacturing and sale of drugs that fall into this category, including cough syrups, analgesics, and antibiotic combinations. In a recent edition of The 5 Minute WrapUp Premium, we explained how FDCs pose a new challenge for the pharma companies(Subscription Required).

Moving on to news from the engineering sector. As per a leading financial daily, Bharat Heavy Electricals(BHEL) has successfully commissioned the first 800 MW Supercritical thermal unit in Karnataka, which is also the highest rating unit in the state. The unit has been commissioned at the 2×800 MW Yeramarus Thermal Power Station (TPS) located in Raichur district of Karnataka. Yeramarus is being developed by Raichur Power Corporation (RPCL) – a Joint Venture of Karnataka Power Corporation (KPCL) and BHEL.

The second unit of this project is also in an advanced stage of construction and is expected to be commissioned shortly. BHEL’s scope of work for the project includes design, engineering, manufacture, supply, erection and commissioning of state-of-the-art supercritical Boiler and Turbine Generators along with associated civil works and agreed Balance of Plant packages.

Engineering stocks finished the day on a positive note with L&T and BHEL leading the gains.

USDINR trade today trading up 15 paise at 67.31 per US dollar.

Out of 1,812 stocks traded on the NSE, 1046 declined and 503 advanced today.

Top 5 Nifty Gainers: L&T (9.50%), BHEL (1.71%), GAIL (1.63%), ONGC (1.38%) and Hero Motocorp (1.90%).

Top 5 Nifty Losers: Sun Pharma (-1.42%), NTPC (-1.41%), SBI (-0.71%), Cipla (-0.49%) and TCS (-0.46%)

To qualify NCFM Capital Market Dealers Module certification examination, register with Intelivisto.com and buy Capital Market comprehensive question bank which features mock test, chapter-wise and full length test as per NCFM standards. It also includes performance analysis tools to analyze the performance. For more information call on: +91-9582000102.