Vol.
: 354
04 SEPT ,2017
Index
Market View 1
MARKET VIEW
Company Update 2
GDP DECLINE SEEMS TEMPORARY
Around the
Economy 3 The data of first quarter GDP growth was way below expectations, at 5.70%. The
experts and statisticians are of the view that demonetization and introduction of GST
Knowledge Corner 3
from 1st July was the main reason for this remarkable decline. As there was confusion
Mutual Fund 4 regarding the role over input credit amongst the wholesalers and retailers, they have
th
Commodity Corner 5 put all efforts to clear their old stocks before 30 June to avoid the confusion. Under
the circumstances, the GDP growth was really affected and the market has digested
Forex Corner 6
the same without any reaction. The initial figures of GST collection are encouraging
Report Card 7 and we hope that the noise around GST implementation will be settled shortly. The
above theory is reinforced by the robust manufacturing data in August with rise in PMI
Short Term Call Status 8
to 51.2%.
In fact the market is waiting for earnings recovery to scale new heights and let us
Special Contributors hope for the early recovery in the same. Technically the market has bounced back
Kunal Shah from the important support levels and is trying to go beyond all important resistance
Dhaval Ghodasara
level of 10050. If the market goes above 10050 and sustains that level we can expect
new high. Watch for Geopolitical tension in the form of Western block and North Ko-
rean block.
For suggestions, feedback
and queries
jstreet@jhaveritrade.com
Kamal Jhaveri
MD- Jhaveri Securities
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Vol.: 354
04 SEPT ,2017
Company Update : DEWAN HOUSING FINANCE LTD
Company Basics Financial Basics Share Holding Pattern
BSE Code 511072 FV (`) 10.0 Holder's Name % Holding
EPS (`) (TTM) 92.38 Promoter 39.29
NSE Symbol Dhfl P/E (x) (TTM) 13.84 Public 60.71
EQUITY (` in Cr.) 292 P/BV (x) (TTM) 1.84
MKT.CAP (` in Cr.) 14350
Outlook and valuation : We recommend BUY on the stock BUY rating for the stock and value DHFL at
SoTP valuations, with a t a r g e t p r i c e o f R s . 5 3 0 w i t h P / E o f 1 4 .
Company Overview :
Incorporated in Maharashtra in 1984 as Dewan Housing Finance & Leasing Co, the company was renamed as Dewan
Housing Development Finance in 1984, then after to Dewan Housing Finance Corporation (DHFC) with its registered office
in Bombay.
The company provides housing finance to individuals, co-operative societies, corporate bodies or their nominated employ-
ees, groups of persons, etc, and leases commercial and residential premises to reputed companies.
Investment rationale for Dewan Housing Finance Ltd
DEWH continues to capitalize on its mortgage lending expertize in an Under penetrated market. Its focus on being a core
mortgage finance player is demonstrated by the fact that it is divesting non-core assets such as the life insurance busi-
ness.
The government focus on affordable housing segment and the concept of housing for all.
The decreasing rate of interest on housing loans is also providing a good support to housing companies.
DHFL is bound to be a key beneficiary of governments initiative to promote affordable housing given its presence in tier
II/III cities and lower ticket size.
Its gradual transformation to a core mortgage player with strong growth and healthy return ratios
Asset quality continues to remain robust
Asset quality continues to show strong resilience as Gross non-performing asset (NPA) ratio declined marginally by 1 bp
QoQ to 0.9%. Gross NPA ratio of DHFL have been consistently below ~1% over the last seven years.
Strong growth of AUM of 20% (yoy) and NII at the reate of 22%.
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04 SEPT ,2017
Around The World
Weekly Market Recap :
The eight core industries comprising 40.27% of the weight of items included in the index of industrial production (IIP) rose 2.4% in
July. Its cumulative growth during April to July, 2017-18 was 2.5%. The data released by the government on Friday August
showed that India's GDP at constant (2011-12) prices in Q1 June 2017 is estimated at Rs 31.10 lakh crore, as against Rs 29.42
lakh crore in Q1 June 2016, showing a growth rate of 5.7%. The fiscal deficit stood at Rs 5.05 trillion for April-July or 92.4% of the
budgeted target for the current fiscal year ends in March 2018.
North Korea fired a missile early on 29 August 2017 that flew over Japan and landed in the Pacific waters off the northern region of
Hokkaido. The consumer confidence index rose to 122.9, up from 120 in the prior month, the Conference Board said. China's offi-
cial non-manufacturing purchasing-managers' index fell for a second straight month to 53.4 in August from 54.5 in July.
Market Eye Week ahead :
The India Meteorological Department (IMD) in its weekly weather report said that for the country as a whole, cumulative rainfall dur-
ing this year's monsoon upto 30 August has been 3% below the normal rainfall. On the macro front, Markit Economics will unveil
the result of a monthly survey on the performance of India's services sector in August 2017 on Tuesday, 5 September 2017.
European Central Bank (ECB) monetary policy outcome is scheduled on Thursday, 7 September 2017. On Friday, 8 September
2017, China is slated to release its trade balance data for the month of August. Caixin China Services PMI data for August 2017 is
scheduled on Tuesday, 5 September 2017. On the same day, Eurozone Markit PMI Composite data for August 2017 is slated to
release.
Key Events / Factors to Watch
1. Mon : Dividend:Advanced ebzyme,Ratnamani Metals
2. Tue : Care Rating, Castrol,Force motor,Hindalco ind.
3. Wed : Dividend: Balkrishna Ind, Balmer Lawrie
4. Thu: Dividend: Star, Petronet, NTPC, Escorts.
5. Fri : Dividend: KRBL Ltd.
Knowledge Corner :
BUY BACK
A buyback is repurchase of shares, means company purchase their own shares from market which in turn reduces
the open share in market.
Why it is important?
By reducing the number of shares outstanding on the market, buybacks increase the proportion of shares owned by enduring inves-
tors. A buyback also boosts the proportional share of earnings a share is allocated.A company may feel its shares are undervalued
and buy them back to provide investors with a return.
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Vol.: 354
04 SEPT ,2017
Mutual Fund Corner
Top 10 Sector Break-Ups
Fund Name
Scheme Name Birla Sun Life Balanced Advantage Fund
Sector Weights Fund (%)
Financial 23.73
AMC Birla Sun Life Asset Management Company Ltd
Energy 10.04
Type Open Ended & Hybrid Asset Allocation Automobile 7.59
Healthcare 1.32
Category Open-ended
FMCG 11.60
Launch Date April 2000 Engineering 0.97
Technology 5.88
Fund Manager Vineet Maloo & Mohit Sharma
Construction 3.00
Net Assets (` Metals 4.95
1745.4 Cr as on July 31, 2017
In crore )
Chemicals 1.23
History 2014 2015 2016 2017 Risk Analysis
Volatility Measures
NAV (Rs) 36.80 38.13 44.35 49.64
Standard Deviation 10.21
Total Return (%) 27.73 3.61 16.31 11.93 Sharpe Ratio 0.78
Beta 0.83
Rank (Fund/Category) - 13/18 2/18 12/18
R-Squared 0.77
Alpha 4.12
52 Week High (Rs) 37.51 39.01 45.35 49.91
52 Week Low (Rs) 27.64 35.68 34.01 44.43 Composition (%)
Equity 73.97
Net Assets (Rs.Cr) 4.69 4.89 58.22 1028.22 Debt 25.78
Expense Ratio (%) Cash 0.24
2.85 2.94 2.94 -
Fund Performance v/s Nifty 50 Fund Style
Investment Style
Growth Blend Value
Large
Capitalization
Medium
Small
Fund
VR Balanced
(Rebased to 10,000) Source : - www.valueresearchonline.com
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04 SEPT ,2017
Commodity Corner
BULLION
FUNDAMENTAL: Last week, bullion prices ended with losses where Silver prices dropped by 6.58 percent and gold dropped
by 2.30 percent after stronger than expected United States jobs data increased the likelihood of another U.S. interest rate
increase and the dollar rose. The latest batch of mostly upbeat jobs data, fuelled expectations that the Fed would continue
with its plan to hike rates later this year, spurring an uptick in both the dollar and bond yields while decreasing demand for
the precious metal.Minutes of the Federal Reserves June meeting showed a lack of consensus among policymakers over
the outlook for inflation and how it could impact the future pace of interest rate increases. The Bureau of Labor Statistics re-
ported, nonfarm payrolls grew by 222,000 in June, well above expectations of a 179000 increase, but the unemployment
rate fell to 4.4%, a notch above forecasts of 4.3%.
RECOMMENDATION : BUY GOLD @ 29850 SL 29400 TGT 30100-30500 BUY SILVER @40500 SL 39950 TGT 41350-41850
BASE METALS
FUNDAMENTAL : Base metals prices ended with mixed node as prices seen some pressure on Friday as the dollar gained
after a report showed the U.S. economy created far more jobs than expected in June and the previous months. The mood in
Chinese markets has been cautious ahead of a raft of data expected to show steady growth, although government meas-
ures to rein in the housing market and debt risks are likely to drag on activity in the next few quarters. Copper prices
dropped as the dollar gained, keeping the Federal Reserve on track to raise interest rates at least once this year. Chiles
Antofagasta Minerals said it was facing potential strikes at two mines.
RECOMMENDATION : BUY ALUMINIUM @ 133 SL 130 TGT 136.5-139 BUY COPPER @ 435 SL 428 TGT 446-50 BUY ZINC @ 199 SL
194 TGT 206-12 BUY NICKEL @ 740 SL 710 TGT 785-810.
ENERGY
FUNDAMENTAL : Crude oil prices dropped by over 3% as pressure after investors braced for a rise in Libyan output while the
number of active U.S. drilling rigs rose. An unexpected rise in US crude stocks last week intensified concerns that the con-
tinuing production cuts by the OPEC and Russia arent effectively reducing the glut of oil that has suppressed oil prices for
over two years. The report showed a surprise rise of 3.3mbls in crude inventoriesthe first weekly rise in nine weeks, as
well as increases in gasoline and distillate stockpiles and weak demand for petroleum products. The Organization of the Pe-
troleum Exporting Countries and other big producers have agreed to pump almost 1.8 million barrels per day (bpd) less than
they supplied at the end of last year, and hold output there until the first quarter of 2018.
RECOMMENDATION : SELL CRUDE @ 3120 SL 3250 TGT 3020--2920 BUY NAT.GAS @ 192 SL 184 TGT 198-205
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Vol.: 354
04 SEPT ,2017
Commodity Corner
Forex Corner
Market Recap :
The rupee on Monday weakened against the US
dollar as global markets fell after North Koreas
test of a nuclear bomb on Sunday.
The 10-year bond yield was at 6.509%, com-
pared to its previous close of 6.483%. Bond yields
and prices move in opposite directions.
The dollar index, which measures the US cur-
rencys strength against major currencies, was
trading at 92.653, down 0.18% from its previous
close of 92.814.
Market Eye Week ahead :
The USDINR On daily chart pair below all short term, medium term, and long term moving average which is 20,
100 and 200.Whereas on weekly chart pair has continually taking support at 50WMA. Which suggest short term
trend is bearish. So for trading perspective, one could sell to the level 64.60-64.40 with SL of 67.20 for target of
63.80-63.60.
USD/INR
Level S2 S1 CP R1 R2 High Low Close
USD/INR 63.66 63.92 64.08 64.34 64.50 64.23 66.81 64.19
EUR/INR
Level S2 S1 CP R1 R2 High Low Close
EUR/INR 75.10 75.82 76.41 77.13 77.72 77.00 75.69 76.54
GBP/INR
Level S2 S1 CP R1 R2 High Low Close
GBP/INR 81.97 82.53 82.84 83.40 83.71 83.14 82.27 83.10
JPY/INR
Level S2 S1 CP R1 R2 High Low Close
JPY/INR 57.54 57.92 58.39 58.77 59.24 58.85 58.00 58.31
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Vol.: 354
04 SEPT ,2017
J Street Recommendations Report Card
Nifty last week opened at 9907.15, attained a low at 9783.75 and moved up to 9983.45.Nifty finally closed the week at 9974
thereby showed a net rise of 1.19% on week to week basis. Resistance will be at 9988-10066-10137.Further breakout and
close above 10137 is essential to extend the rise. Support will be at 9913-9844-9685.
Top Fundamental Stocks
Absolute
Stocks Rec. Date CMP on Rec. CMP Target Return @ Status
CMP
Maruti Suzuki 30/06/2017 7220 7765 8800 8% Accumulate
DHFL Ltd 27/06/2017 430 516 560 20% Accumulate
Manappuram Fi- 30/05/2017 87 104 130 20% Buy
Godrej Properties 12/05/2017 508 600 630 3% Buy
Tvs Motor 24/04/2017 485 611 650 26% Accumulate
DCB Bank 17/04/2017 175 186 310 6% Buy
REC Ltd 27/03/2017 175 165 240 -6% Buy
Petronet 20/02/2017 200 222 490 11% Buy
Escorts 06/02/2017 410 643 790 57% Accumulate
Edelweiss financial 16/01/2015 117 239 275 104% Buy
IOC Ltd 27/02/2017 376 430 490 14% Buy
Marico 20/02/2016 255 312 370 22% Buy
Voltamp trans- 13/02/2017 980 1110 1360 13% Accumulate
Mothersumi 03/04/2017 300 313 495 4% Buy
Lic hsg Finc 27/03/2017 608 681 830 12% Buy
Asian Paints 10/03/2017 1030 1131 1260 10% Buy
Nbcc india 20/03/2017 175 209 225 19% Buy
M&M 12/01/2015 1238 1378 1450 11% Buy
On Saving, Dont save what is left after saving , but spend what is left after saving.
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Vol.: 354
04 SEPT ,2017
J Street Short Term Call Status
Sr. BUY/ TRIGGER %
No.
DATE STOCK RANGE RANGE TGT SL STATUS
SELL PRICE RETURN
1 18-Jul-17 BHARATFORG BUY 1140 1150 1145.00 1195.00 1112 TA 4.2
2 19-Jul-17 ZEEL BUY 525 535 530.00 564.00 509 TA 4
3 20-Jul-17 DHFL BUY 465 472 468.50 492.00 454 SL -3.4
4 21-Jul-17 PFC BUY 125 128 126.50 134.00 122 SL -3.8
5 24-Jul-17 CUMMINSIND BUY 995 1010 1002.50 1052.00 968 TA 4.3
6 25-Jul-17 GODREJCP BUY 985 996 990.50 1038.00 958 TA 4.2
7 26-Jul-17 UPL BUY 882 894 888.00 930.00 861 SL -3.2
8 27-Jul-17 BEL BUY 173 177 175.00 185.00 169 TA 4.4
9 31-Jul-17 HAVELLS BUY 475 482 478.50 502.00 463 SL -3.4
10 1-Aug-17 PCJWELLERS BUY 254 258 256.00 270.00 248 TA 4.6
11 2-Aug-17 ADANIPORT BUY 402 406 404.00 422.00 394 TA 4.4
12 3-Aug-17 VOLTAS BUY 538 545 541.50 570.00 524 TA 4.2
13 4-Aug-17 HINDPETRO BUY 391 396 393.50 412.00 382 TA 4.1
14 7-Aug-17 NTPC BUY 174 178 176.00 187.00 169 SL -3.6
15 8-Aug-17 HINDALCO BUY 225 229 227.00 238.00 220 TA 4.2
16 9-Aug-17 HEXAWARE` BUY 258 263 260.50 273.00 252 TA 4.3
17 10-Aug-17 VEDL BUY 297 301 299.00 313.00 290 TA 4.2
18 11-Aug-17 STAR SELL 950 938 944.00 902.00 976 TA 4.2
19 14-Aug-17 MCDOWELL SELL 2440 2410 2425.00 2315.00 2790 EXIT .
20 16-Aug-17 M&MFIN BUY 420 424 422.00 445.00 412 OPEN
21 17-Aug-17 RADICO BUY 158 162 160.00 183.00 148 TA 4.3
22 18-Aug-17 CESC BUY 940 955 947.50 992.00 915 TA 4.6
23 21-Aug-17 HAVELLS BUY 474 482 478.00 499.00 462 OPEN
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Vol.: 354
04 SEPT ,2017
J Street Short Term Call Status
BUY/ TRIGGER %
Sr. No. DATE STOCK RANGE RANGE TGT SL STATUS
SELL PRICE RETURN
24 22-Aug-17 AMBUJACEM BUY 272 276 274.00 287.00 265 OPEN .
25 23-Aug-17 DHFL BUY 455 462 458.50 480.00 443 TA 4.6
26 24-Aug-17 BEL BUY 181 184 182.50 194.00 173 TA 4.2
27 28-Aug-17 KAJARIACER BUY 695 707 701.00 742.00 676 OPEN .
28 29-Aug-17 HINDUNILVR BUY 1190 1210 1200.00 1260.00 1162 OPEN .
29 30-Aug-17 GSFC BUY 139 142 140.50 151.00 135 OPEN .
30 31-Aug-17 PEL BUY 2700 2730 2715.00 2848.00 2641 OPEN .
STATUS CALLS RATIO
TA+PB 17 77.27
SL+EXIT 05 22.73
TOTAL 21 100.00
One call on daily basis is given keeping view of short term trading on closing basis.
Time frame and expected % of return is also mentioned with the suggested call.
This call are purely given on technical trading system generated by the Technical Research Desk.
Generally Expected Return on investment is 5-6 % with time horizon of 6-7 days.
Profit Booking update is considered if on an average expected return exceed 3.50-4.00 % against the
Expected return of 5-6%
Risk- Reward ratio percentage wise depends on the volatility of stock Normally it stands ( 3 : 9)
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Vol.: 354
04 SEPT ,2017
