>Equtiy Weekly Watch (ANAGRAM)

INFOSYS TO GUIDE THE MARKETS


From next week hectic preparations for India’s 15TH General Elections will start with full earnest. Ensuing week will also mark the beginning of whole host of important quarterly results starting with Infosys Technologies on 15th April. We are concerned regarding the clients delaying outsourcing projects and the increased risk of pricing pressures on I.T. companies. On the top of the woes on business front, we are expecting turbulence on account of currencies also. Fundamentals of Rupee suggest it is likely to appreciate in medium term. We advise investors should caution on the IT front.


Elsewhere in Asia, Minutes of the Bank of Japan's monetary policy meeting in March. showed that members of the board shared a view that "economic conditions had deteriorated significantly and were likely to continue deteriorating for the time being".


To see full report: WEEKLY WATCH

>Asia Economics (ANZ)

Highlights

• Our macro view remains unchanged from last month:

* The acute weakness of Q4 2008 has largely carried over into 2009; we expect only a modest improvement in Q1.
* An exception is China, where the massive stimulus effort continues to gain traction. However, we are still focused on an inflection point—it is too early to declare a recovery.
* Any growth will be domestic-led this year, with fiscal stimulus plans beginning to help. The ASEAN group will continue to outperform the more export-dependent NIEs.
* USD-AXJ is expected to re-test cyclical highs, with USD-SGD breaking the 1.56 barrier after the MAS adjusts its policy band in April. KRW should out-perform in 2009, but the road ahead is filled with pot-holes.
* Asian rates will remain vulnerable to swings in risk appetite. Ample scope for more rate cuts and worries about supply maintain the bias for steeper curves generally.

To see full report: ASIA ECONOMICS

>Recommendations Review (ANAGRAM)

• ABG Shipyard
• Foursoft
• GSFC
• GSPL
• Seamec
• Suzlon
  

To see full report: RECOMMENDATIONS REVIEW

>Inflation Meter (INDIA CAPITAL MARKET)

WPI rises to 0.31% - but downside will continue

• The WPI fell to 0.26% for the week ended March 28, 2009 against 0.31% for the week ended March 21, 2009.(consensus was at 0.35%). Full Year FY 08-09 WPI at 8.32%..highest since 94-95• For the full year FY08-09 (FY07-08), the provisional WPI stood at 8.32% vis-à-vis 4.67% in FY07-08. The previous highest inflation for full year was in FY 94-95 at 12.50%.(first year ofnew series of WPI)

• The full year FY08-09(FY07-08), the price indices of Primary Articles, Fuel Group and Manufacturing group came at 9.98%(7.61%), 7.36%(0.97%), and 8.00%(4.97%) respectively.

To see full report: INFLATION METER

>Automobile Sector (RELIANCE MONEY)

Two Wheeler Sales Volume Update - March 2009

FY09 ends with hope of improvement….

FY09 ended on a positive note for two wheeler companies as sales volumes of companies showed improved performance in the last few months as compared to earlier period of the year. HH & TVS have reported a jump in volumes to the extent of 10% and 4% respectively. While, BAL has restricted fall to 13% due to strong volumes generated by the recently launched XCD. It is noteworthy that despite the fall in volumes on a yearly basis, BAL has reported flattish growth on m-o-m basis during the month ofMarch 2009 and is improving sales every month, though not on y-o-y basis. The benefit of excise duty cut along with new launches in the form of variants has led the growth for companies in the two wheeler space

The excise duty cut benefit extended beyond 31st March 2009 is also a positive indication for the two wheeler industry and we believe that it will help the companies in reporting good volumes along with attractive new launches, Which without any doubt have been the key for the volumes growth for the companies during FY09. In the near future we expect the volumes of companies to improve on the back of 1) softening interest rates and 2) Improvement in exports (post H1FY10). However, we remain hopeful that volumes will continue to pick up as the companies have planned new launches strategically which is likely to continue the existing growth of companies in future.

Exports which account for a sizeable portion of the volumes for TVS and BAL have been declining on a monthly basis which is due to the increasing competition in the global arena and also due to the slowdown in global economy. Exports of BAL fell by 8.2% y-o-y while TVS grew robustly by 25% on a y-o-y basis, but its volumes on m-om basis reported a fall of 1.5%. It is interesting to note that on a y-o-y basis the two wheeler industry has reported growth of 2.5%. We upgrade our outlook on the sector to Neutral from negative on the back of improvement in overall scenario.

Industry Highlights
* Honda will exit the geared scooter market in India and phase out its 150 ccmodel Eterno as the company plans to focus on the gearless segment.
* TVS Motors will launch a unisex scooter model in the current financial year , inpace with the popularity of the segment in the present urban and semi-urban twowheeler markets.
* Yamaha Motor has launched its new bike 'FZ-S' priced at Rs 67,000 (ex-showroomDelhi).
* Honda Motorcycle & Scooter India (HMSI) has decided to launch a 100ccmotorcycle in the next fiscal.

To see full report: AUTOMOBILE SECTOR

>Stocks on the move (ICICI Direct)

- > BALRAMPUR CHINI
- > TATA ELXSI

Balrampur Chini: Balrampur Chini Mills is one of the largest integrated sugar manufacturing companies in India. The company has nine sugar factories located in eastern UP having an aggregate crushing capacity of 73,500 tonnes per day. With the India sugar inventory falling from 9.1 MT in 2008 to less than 4 MT in 2009, the current demandsupply mismatch has led to a surge in sugar prices to Rs 22 per kg causing mills to register a significant improvement in margins. We believe the company is likely to benefit from the low-cost 1.17 lakh tonnes of sugar inventory, which the company is holding. It is also well capitalised to benefit from rising sugar prices due to its integrated business model and operational efficiency.

Tata Elxsi: Tata Elxsi is engaged in providing information technology related products and services. It offers embedded product design services, industrial design and engineering, animation and visual effects and systems integration services. The company primarily operates in India. The company had provided the animation support for one of theBollywood animated movie Roadside Romeo. Since the company operates primarily in India it will be less impacted from the slowdown in the global financial markets.

To see full report: STOCKS ON THE MOVE

>A Shock Heard Around the World (CIBC)

To see report: A Shock Heard Round the World

>Daily Derivatives (ICICI Direct)

Derivative Comments
• The Nifty April futures added 154950 shares in OI. Although the premium has come down to 8 points, significant short covering in the Nifty was seen in the last hour of trade on Monday wherein we feel a majority of intraday shorts have got cleared

• The options data depicts a net addition in OI of 31384 contracts in Puts compared to 10816 contracts addition in Call options. The 3300 Put and 3400 Call were the most active contracts wherein the maximum addition was seen in the 3300 Put adding 23118 contracts with IV rising from 35 to 39. The 3400 Put added 11572 contracts whereas the 3400, 3500 and 3600 Calls added 5141, 2383 and 9301 contracts, respectively. The 3100, 3200, 3500 and 3600 Call IVs
are more compared to their Put IVs. Unwinding of 5406 and 4480 contracts in 3000 and 3100 Put depicts profit booking by Put writers. Since the overall Nifty volatility has moved from 37 to 40, the IVs of options have risen significantly. We feel that 3300 should continue to act as a strong support for the Nifty on a closing basis since we have seen further Put writing at this strike price. Since the Put IVs of 3000, 2900 and 2800 are trading at 48, 53 and 56; we feel it is more viable to go for OTM Put writing of 3000 and below strike prices.

To see full report: DERIVATIVES 150409

>Daily Calls (ICICI Direct)

Sensex: We said, "formed a bear candle, but an UP day ... Cautiously positive ... " Index did trade
cautiously, even losing 193 points from its opening highs. Thanks to a late surge, however, it closed 1.5% higher. While Metal and bank Indexes gained 5% each, broader market posted 3% gain. A/D ratio improved to 5:1.
The action formed a High Wave pattern, indicating expected cautiousness near 200-day EMA. Both high and low of this candle could, therefore, be crucial. If its high at 11070 fails to sustain above, we may watch the low at 10800 as crucial level, holding which, existing up-trend remains intact.

To see full report: CALLS 150409

>Daily Market & Technical Outlook (ICICI Direct)

Market outlook
* Indian markets are likely to open flat to negative on account of weak global cues. Asian markets were trading weaker in the morning after a surprising drop in US retail sales shattered hopes of an economic recovery and sent Wall Street stocks lower. Crude oil slipped under $50 a barrel on Tuesday on forecasts for softer 2009 global petroleum demand and for a weekly build in US crude supplies. The rupee is expected to remain steady with investors watching the stock market for clues on foreign investor appetite. We expect Indian markets to remain volatile and may see some profit booking

* The Sensex has supports at 10890 and 10820 and resistances at 11160 and 11230. The Nifty has supports at 3340 and 3320 and resistances at 3420 and 3450

* Asian stocks dropped, after US retail sales unexpectedly declined and the stronger yen dimmed the earnings outlook for Japan’s electronics and auto companies. The Nikkei fell 74.3 points, or 0.8%, to trade at 8,768.4. The Hang Seng dropped 313.9 points, or 2.0%, to trade at
15,266.3

* US stocks fell on Tuesday as a surprising drop in retail sales dented hopes the recession was abating and financial shares slid on fears that Goldman Sachs' share offering could prompt others to follow suit. The Dow Jones dropped 137.63 points, or 1.71%, to 7,920.18. The S&P 500 fell 17.23 points, or 2.01%, to 841.50. The Nasdaq declined 27.59 points, or 1.67%, to 1,625.72

* Stocks in news: Tech Mahindra, Maruti Suzuki, Lupin, Polaris Software, Novartis

To see full report: OPENING BELL 150409