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The company purchased 886,438 shares via open market on May 16 at Rs 979.81 per share, crossing the necessary 25 percent level to trigger the open offer on May 9.

The stake of engineering behemoth L&T in Mindtree has risen to 26.48 percent after an open market purchase on May 16.

The company purchased 886,438 shares via open market on May 16 at Rs 979.81 per share, crossing the necessary 25 percent level to trigger the open offer on May 9.

However, pending approval of the Securities and Exchange Board of India (SEBI), L&T had to postpone the open offer scheduled on May 14. According to sources, the nod from SEBI is expected within a fortnight.

Once the approval is in place, L&T’s open offer for Mindtree shares can start.

The market regulator SEBI had asked L&T for clarifications and received a response only on May 10. This delayed the approval process making the committee of independent directors set up by Mindtree incapable of giving recommendations to shareholders on whether to opt for the open offer or not.

According to analysts, independent directors can give recommendations only after the letter of offer has been dispatched by L&T. In addition, the recommendations should be made two days prior to the start of the open offer. However, it could not happen without SEBI approval in place.

In India’s first-ever hostile takeover bid, L&T signed a definitive agreement to buy 20.32 percent from VG Siddhartha and his coffee enterprise for over Rs 3,000 crore on March 18, 2019. The deal was formalized last month.

The company said it will buy an additional 46 percent through the open market purchase of 15 percent shares and 31 percent through an open offer. This puts the total value of the acquisition at Rs 10,700 crore at Rs 980 per share.

L&T on May 9 upped its stake to 25.93 percent in Mindtree. A stake of over 25 percent stake in Mindtree means that L&T can call for board meetings and seek a seat on the Mindtree board. Sources said L&T had raised concerns about Mindtree’s governance and board practices and these matters would be the focus for L&T management.

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The broader market indices -- BSE Midcap and Smallcap -- too ended 0.6 percent and 0.3 percent higher, respectively

From a terrible Tuesday, it turned out to be a terrific Tuesday as bulls took control of D-Street in the second half of the trading session, snapping nine-days of a bear grip, thanks to short coverings in beaten down sectors.

At close, the Sensex rallied 227 points to 37,318 and the Nifty ended 73 points higher at 11,222 levels.

On the sectoral front, the BSE Telecom index rose 2.8 percent, followed by the BSE Energy index (up 1.6 percent), and BSE Capital Goods index (up 1.4 percent). On the losing front, IT stocks came under pressure.

The broader market indices -- BSE Midcap and Smallcap -- too ended 0.6 percent and 0.3 percent higher, respectively.

The rally was largely on the back of short-covering and investors should not confuse the move with strength in the index. Every bounceback will be used to book profits, experts said.

In Tuesday’s session, the Nifty staged a bounceback from 11,100 levels to reclaim 11,200 levels but found resistance around its five-day Exponential Moving Average (EMA).

"The market found some respite after many days of consolidation due to the expectation of ease in trade tensions between US and China, as US President Donald Trump sounded optimistic about the upcoming meeting,” Vinod Nair, Head of Research, Geojit Financial Services, told Moneycontrol.

“Short covering was seen in beaten down sectors like banks and pharma, while IT continued to underperform due to strength in the dollar-rupee. Investors are not very aggressive in the market as every rally will be used as an opportunity to book profit and remain watchful on quarter earnings and ahead of the election verdict on May 23,” he said.

Investors should use dips of the last two weeks, when the market fell for nine consecutive days in a row, to buy into quality stocks. Traders should avoid leverage as volatility is here to stay, experts said.

“Indian markets seem to have sensibly responded to the trade spat between US and China and hopefully this too shall pass. Investors should buy quality companies on such panic selling days,” Umesh Mehta, Head of Research, Samco Securities, said.

Stocks in news:

Jet Airways: The stock ended 7.42 percent lower after Deputy Chief Executive and Chief Financial Officer (CFO) Amit Agarwal resigned from the beleaguered airline.

Vodafone Idea closed 3.11 percent lower after global research firm CLSA initiated coverage with a Sell rating on the stock and cut its target price to Rs 12.50 from Rs 27 per share earlier.

Sun Pharmaceutical Industries' ended Tuesday's session with a 5.87 percent cut, just days after more than 40 states in the US filed a lawsuit alleging artificial price inflation by drug manufacturers.

Siemens India rose nearly 4 percent after it reported a net profit of Rs 280 crore for the second quarter of FY19, up 27.6 percent over the same period last year.

Global update

Asian markets ended lower on Tuesday, a day after Beijing raised tariffs on some American goods in retaliation for Washington’s decision last week to increase duties on Chinese products.

Shanghai Composite ended 0.69 percent lower at 2,883.61, Hong Kong’s Hang Seng index fell around 1.7 percent and Nikkei 225 dipped 0.59 percent to close at 21,067.23. The Kospi bucked the overall trend, ending up 0.14 percent to close at 2,081.84.

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Spot gold was mostly steady at $1,298.48 as of 0255 GMT, after hitting $1,303.26, its highest since April 11.

Gold prices held steady near one-month highs on Tuesday as an escalation in Sino-U.S. trade war sent investors looking for safe-haven assets.

Spot gold was mostly steady at $1,298.48 as of 0255 GMT, after hitting $1,303.26, its highest since April 11.

U.S. gold futures were down 0.2% at $1,299.20.

Asian shares extended losses on Tuesday, following sharp falls on the Wall Street overnight, the yen strengthened and U.S. Treasury yields ticked lower after Beijing on Monday announced retaliatory tariff-hike to counter Washington.

"Gold is moving because people are looking to find a safe harbour in the storm while they wait for the dust to settle," said Jeffrey Halley, senior market analyst, Asia Pacific at OANDA.

"Prices could further rise to $1,310-$1,312 if stock markets end lower. But, any sudden breakthroughs in the trade stand-off possibly could see investors stampeding for the exit as fast as they arrived."

On Monday, the metal rose 1.1% to mark its biggest one-day percentage rise since February 19. Prices broke through multiple technical resistances, which had acted as a barrier for bullion despite the slump in global markets over the past week.

The biggest trigger for gold came on Monday after China announced that it would impose higher tariffs on a range of U.S. goods, which followed Washington's decision last week to hike its own levies on $200 billion in Chinese imports.

In addition to more tariffs, traders are concerned that China, the largest foreign U.S. creditor, may dump treasuries to counter the Trump administration's hardening trade stance.

Adding to financial market worries, gold investors were also keeping a tab on escalating tensions between the United States and Iran after Saudi Arabia said on Monday that two of its oil tankers were among those attacked off the coast of the United Arab Emirates.

"The Middle East escalation news brings us a step closer to a significant U.S. military reprisal. Fears that China will weaponise U.S. Treasuries in trade war retaliation is scaring the daylights out of markets even if it is unlikely," said Stephen Innes, head of trading and market strategy at SPI Asset Management.

Rise in investor interest in bullion was also evident after holdings of SPDR Gold Trust, the world's largest gold-backed exchange-traded fund, rose 0.44% on Monday, its biggest one-day rise in nearly two months.

Among other precious metals, silver edged 0.1% higher to $14.78 per ounce, while platinum rose 0.3% to $855.85.

Palladium rose 0.6% to $1,331.

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We believe LME Zinc prices to remain under selling pressure with prices falling towards $2,500-$2,450 per tonne.

The commodity space saw varied movements by different commodities last week. The base metal complex was the worst hit after Trump threatened to impose new tariffs on Chinese goods from May 10.

Zinc prices were hit the most losing almost 5 percent, nickel and lead both ended 2.5 percent lower while aluminum was the only gainer, closing 1.9 percent up last week. Amongst precious metals, Comex silver prices lost 1 percent during the last week on the fear that global retreat may dampen industrial demand for silver.

Gold prices instead remained steady on account of safe haven status and as the bond yields started to rise. Energy complex ended mixed with Nymex crude ending flat on uncertain demand outlook and supply tightness while Nymex natural gas closed the week with 1 percent gain.

On the base metals side, zinc is losing its appeal after the LME inventories started to rise since last month shifting the investors and fund managers focus towards its upcoming supply. The LME inventories started to increase after its market moved in a backwardation of more than $100 per tonne.

The rising TCRC charges also confirmed the supply increment as the smelters would seize the opportunity by raising its production in the coming quarter. The refined production in China, the world’s largest producer of zinc, is expected to increase 5 percent in June which will be a 15 percent rise as compared to the previous year.

Globally, the International Lead and Zinc Study Group expect the market to remain in a deficit of 120,000 tonnes in 2019, much lower deficit than the last year. Traders are waiting to sell the metal as many Put options are placed and speculators are cutting their bullish LME zinc bets by 10,280, net-long positions to 40,612.

With the lack of optimism seen on the demand front and incoming increasing mine supply, we believe Zinc prices are unlikely to find respect on the upside. The unsettled trade worries suggest demand downfall is underway.

If the US-China trade deal remains unsettled, we believe LME Zinc prices to remain under selling pressure with prices falling towards $2,500-$2,450 per tonne. Currently, the LME Zinc prices are trading at $2,650 per tonne.

The author is a Commodity Analyst at Narnolia Financial Advisors Ltd.

Disclaimer: The views and investment tips expressed by investment experts on moneycontrol.com are their own and not that of the website or its management. Moneycontrol.com advises users to check with certified experts before taking any investment decisions.

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In terms of market capitalization, investors lost nearly Rs 5 lakh crore during this week

Indian market witnessed an eighth consecutive day of fall on Friday. For the week, the S&P BSE Sensex plunged 3.8 percent while Nifty50 fell 3.7 percent in the same period.

In terms of market capitalization, investors lost nearly Rs 5 lakh crore during this week. The average market-capitalization of BSE-listed companies fell from Rs 151.62 lakh crore on May 3 to Rs 146.51 lakh crore on May 10.

The final tally on D-Street for Friday – the S&P BSE Sensex fell 95 points to close at 37,462 while the Nifty50 closed 22 points lower at 11,278.

In terms of sectors, NiftyBank plunged by about 3 percent for the week ended May 10. The Nifty Metal index dropped 6.3 percent followed by the Energy Sector which was down 5.9 percent, and Nifty Auto, Nifty Pharma, and Nifty Infra were all down by about 3 percent each.

Trade tensions between the two nations i.e. US and China fuelled volatility in global markets and the rub-off effect was seen on the Indian market as well.

Apart from weak global cues, experts are of the view that weak earnings from Indian Inc. also led to some bit of nervousness on D-Street.

“The recent correction got aggravated post Q4 numbers from India Inc. In the last 10 days, we saw more earnings downgrades than upgrades. Almost 21 Nifty companies which have declared their numbers which constitute about 60% of profits suggest that FY19 EPS will be modest around 6% compared to expectations of 10%,” Shailendra Kumar, Chief Investment Officer at Narnolia Financial Advisors told Moneycontrol.

“The commentary we have seen from the management suggests that Q1 and Q2 will also remain soft. There is a chance of earnings downgrade in FY20 as well. Whenever EPS gets downgraded the price will fall to adjust the multiple to the same level when the earning season was started,” he explains.

Stocks in news: State Bank of India (SBI) reported a net profit of Rs 838.4 crore for the quarter ended March 31, 2019, on the back of higher provisions. The bank had reported a loss of Rs 7,718 crore in a year ago period. The stock rose nearly 3%.

The share price of steel major Tata Steel was down 6 percent after sources told Reuters that ThyssenKrupp is expecting the joint venture with Tata Steel to fail.

The share price of Delta Corp ended nearly 7 percent lower after news report emerged that DG GST Intelligence has booked two Goa companies, including Delta Corp, for Rs 6,189 crore evasion.

HCL Technologies: Shares of IT major lost by about 4% and slipped below its 50-DMA as FY20 margin guidance was cut by 100 bps. The company sees the operating margin at 18.50 – 19.50 percent in constant currency (CC) terms for the current financial year. However, most of the global brokerage firms remain fairly upbeat.

Most brokerage firms maintained their rating on Asian Paints post its March quarter results but slashed target prices as margins took a hit. The stock fell by over 1% on the BSE.

Global Markets: Stocks in Asia rallied on Friday after the US carried out its threat and raised tariffs on Chinese goods. The Shanghai composite closed 3.1 percent to about 2,939.21.

The Nikkei 225 fell 0.27 percent to close at 21,344.92. The Kospi was 0.29 percent higher to close at 2,108.04, while the ASX 200 in Australia finished 0.25 percent higher at 6,310.90.

European markets were trading higher on Friday morning despite the US hiking duties on USD 200 billion worth of Chinese products. Pan-European STOXX 600 climbed 0.9 percent with the French CAC 40 and German DAX indexes rising 1 percent each.

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Brokerage firms such as CLSA, Macquarie and Credit Suisse slashed their target prices on the stock on muted Q4 results

Most brokerage firms maintained their rating on Asian Paints post its March quarter results but slashed target prices as margins took a hit.

Asian Paints reported fourth-quarter earnings on May 9 that missed analysts estimates on weak operating income.

Consolidated profit was lower by 1.7 percent year-on-year at Rs 487 crore in the quarter ended March 2019. CNBC-TV18 poll estimated profit of Rs 570 crore and revenue of Rs 5,200 crore. EBITDA was expected at Rs 958 crore and margin at 18.4 percent for the quarter.

Revenue from operations increased 11.7 percent YoY to Rs 5,018 crore in Q4 from Rs 4,492.30 crores with decorative business registering double-digit volume growth in India.

Here’s what brokerage firms recommend on Asian Paints post Q4 results:

CLSA: Sell| Target cut to Rs 1285 from Rs 1400

CLSA maintained its sell rating on Asian Paints post Q4 results and reduced its target price to Rs 1,285 from Rs 1,400 earlier.

The Q4 results were an all-around miss. The management outlook was cautious. The volume growth was impacted by an inferior mix.

Increased input prices and higher marketing spend are some of the factors which impacted the margins. The global investment bank slashed EPS estimates by 1-3% for FY20-21.

Macquarie: Outperform| Target cut to Rs 1,470 from Rs 1,580 earlier

The key positive from Q4 was a continuation of double-digit volume growth. The key negative was margin pressure due to higher A&P spend, as well as provisions.

Credit Suisse: Neutral| Target cut to Rs 1,425 from Rs 1,500

Credit Suisse maintained its neutral rating but slashed target price to Rs 1,425 from Rs 1,500 earlier.

The company recorded healthy volumes at the cost of a large margin miss. The global investment bank slashed FY20/FY2e EPS estimates by 6-9 percent.

The volume growth was healthy, but realization growth was only 2 percent compared to the price hike of 6 percent.

Disclaimer: The above report is compiled from information available on public platforms. Moneycontrol.com advises users to check with certified experts before taking any investment decisions.

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Asset quality on a sequential basis is expected to improve with slippages either likely to be steady or lower compared to the previous quarter, brokerages said

The country's largest lender State Bank of India (SBI) is likely to report a profit in the March quarter with double-digit growth in net interest income and lower provisions.

The state-owned lender will report the numbers on May 10.

Most brokerages expect profit in the range of Rs 5,000-7,000 crore for the quarter against a loss of Rs 7,718.2 crore in the same period last year.

"PAT is expected to grow at the rate of 53 percent QoQ to Rs 6,034 crore," Narnolia Securities said, while Kotak said it expects the same to increase by 70 percent QoQ to Rs 6,759.4 crore for the quarter.

Double-digit loan growth with steady net interest margin may help net interest income grow in double digits, brokerages said.

"We expect loan growth at steady 11-12 percent YoY with largely steady NIMs leading to 16-17 percent NII growth," Prabhudas Lilladher said.

Motilal Oswal expects loan growth of 11 percent YoY, led by growth in retail books and portfolio buyouts. Deposit growth is expected to come in at

8 percent YoY, it added.

NII is expected to increase 15 percent YoY due to lower interest reversals and better recoveries from written off accounts, the brokerage said, adding non-interest income is expected to decline YoY but increase QoQ on account of an improvement in the treasury performance and fee income.

Asset quality is expected to improve sequentially with slippages either likely to be steady or lower compared to the previous quarter.

"Asset quality should improve as we expect very similar slippages as seen in Q3FY19 but do not see recently announced resolutions factoring in this

quarter. We expect the bank will continue to enhance PCR," Prabhudas Lilladher said.

Kotak said slippages will decline to below 2.5 percent as recognition is complete while gross NPLs could decline with resolution/NPL sales to asset reconstruction companies.

Motilal Oswal also feels stress addition is likely to moderate to 1.9 percent, as it believes that most of the stress has been recorded in previous quarters.

Key issues to watch out for would be updates on the retail, SME and Agri slippages; recoveries from a resolution of NCLT accounts; outlook on power assets and macro developments on asset quality.

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Spot gold firm at $1,280.76 per ounce at 0317 GMT. U.S. gold futures were also steady at $1,281.30.

Gold prices held steady on Thursday ahead of Sino-U.S. trade negotiations, while demand for government bonds and Japanese yen and a key technical resistance limited gains for the safe-haven metal.

Spot gold firm at $1,280.76 per ounce at 0317 GMT. U.S. gold futures were also steady at $1,281.30.

"We are not in the flight to safety or panic mode despite the risk-averse market we are seeing right now and that's why we are not seeing gold prices rally," said David Song, an analyst at DailyFX.

Gold prices closed near session lows on Wednesday after climbing to their highest since April 15 at $1,291.39.

"There is still some hope that there could be a deal between U.S. and China. We are watching $1,250-$1,260 levels with a 200-day moving average a key factor for gold," Song said, adding that the Japanese yen's uptick has benefited from the risk-off sentiment in global markets.

The dollar has sagged against the Japanese currency, stocks have retreated and government bonds have surged in turn.

Markets were nervously awaiting the start of two-day trade talks in Washington later in the day to see if Chinese negotiators can convince the White House to back down on a possible tariff hike on Chinese imports.

Washington has accused Beijing of backtracking on commitments made during trade negotiations and U.S. President Donald Trump has threatened to hike existing tariffs on Chinese goods on Friday and impose fresh levies soon if there is no deal.

While gold has managed to draw support due to risk-averse markets, prices have not been able to register a significant uptrend with $1,290 levels further acting as a key technical barrier.

"The precious metal has struggled to hold bullish gains as technical overview remains negative for the current term," Singapore-based Phillip Futures said in a note.

"A continuation of the negative trend scenario during the intraday trading session will see market forces test the key support of $1,274."

Spot gold may fall into a range of $1,267-$1,274, as it failed to break a resistance at $1,291 per ounce, according to Reuters technical analyst Wang Tao.

Silver was down 0.3 percent at $14.81 an ounce, while platinum was up 0.5 percent at $861.

Palladium rose 0.1 percent to $1,316.75 an ounce.

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While maintaining buy call on Supreme, CLSA said it cut the price to Rs 1,320 from Rs 1,387 per share earlier after it slashed FY20 & 21 earnings estimates by 8 percent.

Supreme Industries shares fell 3 percent intraday on May 8 as brokerages cut their earnings estimates of the company. The company reported its fourth-quarter earnings recently.

The stock was quoting at Rs 1,014, down 2.30 percent on the BSE, at 11:17 hours IST.

While maintaining buy call on Supreme, CLSA said it cut the price to Rs 1,320 from Rs 1,387 per share earlier after it slashed FY20 & 21 earnings estimates by 8 percent.

During March quarter, inventory losses impacted margin and volume growth was moderate at 10 percent YoY, the brokerage said, adding management highlighted peak pricing pressure in cross-laminated films.

CLSA sees an improving demand environment for the piping segment.

The plastics product maker reported a sharp 39 percent year-on-year decline in its March quarter net profit at Rs 101.7 crore, and revenue increased moderately by 4 percent to Rs 1,530.9 crore.

Supreme Industries' plastic piping segment, which contributed around 57 percent to total sales in FY19, posted volume growth of 14.7 percent and value growth of 14 percent for the quarter.

Government initiatives, such as affordable housing, effective implementation of RERA, Swacch Bharat Mission, AMRUT Yojana, and other infrastructure-related activities gave a boost to the plastic piping segment.

For the past eight quarters, the company has been facing increased competition in the cross-laminated film business. This has led to price cuts and a

margin decline. However, management believes margin has bottomed in this segment and does not expect any further price cuts.

"This is evident from the fact there was an improvement of 1 percent in sales per kg and 7 percent in EBITDA per kg in the packaging business during Q4," said Elara Capital which reiterated buy call on the stock but reduced price target to Rs 1,393 from Rs 1,514 earlier.

Management has guided for volume growth of 8-10 percent and sales growth of 12-15 percent for FY20. Margin guidance was in the range of 13.5-

15.0 percent.

Elara Capital kept its sales estimates unchanged while cut EBITDA estimates by 9.0 percent for FY20 and 8.0 percent for FY21 and lower PAT

estimates by 8.8 percent for FY20 and 6.9 percent for FY21. "We do not see any shift in business fundamentals and bullish."

Disclaimer: The views and investment tips expressed by investment expert on Moneycontrol.com are his own and not that of the website or its management. Moneycontrol.com advises users to check with certified experts before taking any investment decisions.

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Trends on SGX Nifty indicate a positive opening for the broader index in India, a rise of 32 points or 0.27 percent. Nifty futures were trading around 11,688-level on the Singaporean Exchange.

The Nifty50 is likely to open higher on Tuesday following positive trend seen in other Asian markets, but it is hovering near the 5-week low. Overnight, US markets closed lower after President Donald Trump pledged to raise tariffs on Chinese goods.

Trends on SGX Nifty indicate a positive opening for the broader index in India, a rise of 32 points or 0.27 percent. Nifty futures were trading around 11,688-level on the Singaporean Exchange.

US stocks fell on Monday after President Donald Trump pledged to raise tariffs on Chinese goods, though Wall Street finished well off its session lows as some investors saw Trump’s comments as a bargaining tactic and expressed confidence in an eventual trade agreement, said a Reuters report.

Asian shares wallowed near five-week lows on early Tuesday after US President Donald Trump’s threat to raise tariffs re-ignited worries about US-China trade tensions while Japan’s Nikkei opened down after a 10-day break, it said.

As many as 33 companies are scheduled to declare their results for the quarter ended March which include names like ABB India, Escorts, Jyothy Laboratories, Mahindra Logistics, Vedanta, VIP Industries and Sun Pharma Advanced Research Company among others.

Stocks in news: ICICI Bank reported a 5 percent drop in fourth-quarter profit on Monday, missing estimates after being hit by a rise in expenses and a higher accumulation of bad loans.

Bharti Airtel May 6 reported a 24 percent sequential jump in its fourth-quarter FY19 net profit to Rs 107.2 crore helped by an exceptional gain of Rs 2,022 crore. Analysts were expecting a net loss of over Rs 1,000 crore.

HDFC Bank on May 6 said it will consider a proposal for sub-division of shares from one equity share with a face value of Rs 2 each to two shares with a face value of Re 1 each.

Infrastructure major Larsen & Toubro May 6 bought shares worth about Rs 113 crore of Mindtree through open market transactions.

Technical Recommendations: We spoke to YES Securities and here's what they have to recommend:

Star Cement Limited: Buy| Target: Rs 124| Stop Loss: Rs 102| Upside 14%

PNC Infratech Ltd: Buy| Target: Rs 175| Stop Loss: Rs 145| Upside 14%

Blue Star Ltd: Buy| Target: Rs 790| Stop Loss: Rs 680| Upside 11%

Disclaimer: The views and investment tips expressed by investment expert on Moneycontrol.com are his own and not that of the website or its management. Moneycontrol.com advises users to check with certified experts before taking any investment decisions.

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