Sensex gains 24 points, Nifty ends at 10,877 led by IT, Pharma

The domestic equity market signed off the first day of December F&O series on a positive note on Friday amid buying in pharmaceutical, information technology (IT) and automobile counters.

The S&P BSE Sensex ended at 36,194, up 24 points, or 0.1 per cent, while the broader Nifty50 index settled at 10,877, up 18 points, or 0.2 per cent.

In the broader market, the S&P BSE MidCap rose 0.6 per cent to settle at 15,039 levels, while the S&P BSE SmallCap settled 0.5 per cent higher at 14,427 levels.

The rupee traded on a firm note on Friday, rising to 69.59 against the US dollar in intra-day trade on the back of free fall in crude prices and heavy buying by foreign institutional investors (FIIs). The domestic unit on Thursday had breached the 70-mark for the first time since August 27 to end at a three-month high of 69.85 per US dollar.

Reliance Communications (RCom) rose 13 per cent to Rs 14.40 on the National Stock Exchange (NSE) on Friday after the Supreme Court asked RCom to furnish a corporate guarantee of Rs 14 billion within two days to get the No Objection Certificate (NOC) from the government. The corporate guarantee will be issued by Reliance Realty Ltd, a wholly-owned subsidiary of RCom.

The Nifty Pharma index rose 2 per cent led by a rise in shares of Biocon and Dr. Reddy’s Laboratories. The Nifty IT index gained 1.2 per cent led by Infosys and Tata Consultancy Services (TCS).

YES Bank ended 6.3 per cent higher at Rs 170.50 after a TV report said that the private bank’s promotor Rana Kapoor doesn’t have any ownership in Morgan Credits or Yes Capital.

Shares of Vodafone Idea dipped 6% to Rs 35.60 per share on the BSE after the rating agency CRISIL downgraded its rating on non-convertible debentures (NCD) of Rs 60 billion.

Shares of United Spirits (USL) hit a five-month high of Rs 675, up 6% on BSE in an otherwise range-bound market, on the expectations of higher volume growth in the current quarter. The stock was trading at its highest level since June 28, 2018. In past five-weeks, USL outperformed the market by surging 33% after the company posted a strong 69% year-on-year jump in net profit at Rs 2.59 billion in September quarter (Q2FY19), on the back of robust sales of its premium brands. In comparison, the S&P BSE Sensex was up 5% during the same period.

Shares of real estate companies are in focus, with Nifty Realty index gaining 2% on Friday, on hopes that liquidity may ease in the coming days after the Reserve Bank of India (RBI) on Thursday relaxed rules for non-banking financial companies (NBFCs). Prestige Estates Projects and Oberoi Realty were up 8% and 6%, respectively, on the National Stock Exchange (NSE). Indiabulls Real Estates, Godrej Properties, Sobha, Kolte-Patil Developers Brigade Enterprises and Sunteck Realty gained 1% to 4%.

Shares of housing finance companies DHFL, Repco Home Finance, Reliance Home Finance, Can Fin Homes, Indiabulls Housing Finance rallied up to 7 per cent on BSE in the intra-day trade on Friday after the Reserve Bank of India (RBI) on Thursday halved the minimum holding period of their loans of above five years. According to the revised norms, loans of original maturity of more than five years can be securitised after receiving the repayment of six-month instalments or two quarterly instalments.

The Sun Pharma stock has declined 19 per cent from its highs touched earlier this month, on a muted performance in the September quarter and corporate governance-related issues. Analysts believe that pricing pressures, marketing costs in the US, and the sluggish performance in India are key negatives on the operational front. In addition, related party transactions, highlighted by foreign brokerage Macquarie, will keep the stock under pressure.

Shares of Oil India have slipped 7% to Rs 188 per share on the BSE in an otherwise firm market as it turned ex-date for the proposed buy-back. The board of directors of Oil India in their meeting held on November 19, 2018, has fixed Monday, December 3, 2018, as the record date to determine the entitlement and names of the shareholders who are eligible to participate in the buyback; and the shareholders to whom the letter of offer and tender form will be delivered in relation to the buyback.

Shares of Dr Reddy’s Laboratories hit a 52-week high of Rs 2,700, up 2%, extending its previous day’s 3% gain on the BSE. The stock surpassed its previous high of Rs 2,687 recorded on September 28 in intra-day trade. Since November 20, in past six seven trading days, the stock of pharmaceutical company has moved up 10% after an appellate court in the US cleared the way for the company to resume sales of a Suboxone generic.

Shares of Repco Home Finance slipped 4% to Rs 327 on Friday, extending its yesterday’s 4% decline on BSE after value investor Mohnish Pabrai’s fund sold more than one percentage point stake in home lender for Rs 319 million on Thursday via the bulk deal. On November 30, the Pabrai Investment Fund IV LP sold total 948,535 equity shares at an average market price of Rs 335.87 per share on the NSE and BSE.

Here are some picks from the week gone by.