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					Weekly Equity Strategy
India Edition



                                                                                                                 27 November 2011


                                                                                  India Equities
Contents
                                                      The Indian markets declined for the fourth straight week on heavy selling by
India Equities                          Pg 1
                                                      foreign funds. Concerns over slowing growth, weak corporate earnings and a
India Sectoral Performance              Pg 2
                                                      faltering rupee affected investor sentiment adversely. Fears of a global economic
India Economics                         Pg 3          slowdown also weighed on Indian stocks amid gloomy data from China and the
GWM Report                              Pg 4          United States. The market fell in three out of five trading sessions during the week
IER stock initiation                    Pg 5          Foreign institutional investors (FIIs) outflow totaled Rs 64.8bn in eight trading

Economic Calendar                       Pg 6          session.

India Equity Research Coverage List     Pg 7-9
                                                      Global equities indicated by the MSCI All-World index were down 5.3% for the
Technical Focus                         Pg 10-11
                                                      week. U.S. stocks slumped for a seventh straight session. European Stocks and
                                                      other major exchanges also suffered their worst week in two months. Investors'
                                                      worries intensified after reports that Greece was demanding harsh conditions from
TABLE 1: KEY INDICES                                  creditors on a proposed bond swap -- critical to reduce its debt and save the euro.
 INDEX                 25-Nov   18-Nov      % Chg     The euro hit a seven-week low against the dollar and looked set to weaken further
 SENSEX                15695    16371          -4.1   as Italy's borrowing costs spiraled and Belgium's and Portugal’s credit rating was
 BSE 500               6009      6214          -1.6   downgraded. Commodities also fell broadly, except for U.S. crude oil.
 NIFTY                 4710      4906          -1.6
 NIFTY JUNIOR          9083      9268          -2.2   US stocks posted seven straight sessions of losses on Friday, ending the worst
 CNX MIDCAP                                           week in two months, as the lack of a credible solution to Europe's debt crisis kept
                       6598      6639          -1.8
                                                      investors away from risky assets. Initial gains were offset by headlines out of
Source: BSE and NSE
                                                      Europe that further dented market sentiment. High debt yields from major
                                                      economies in Europe such as Spain, France and Germany suggest investing in the
                                                      region is seen as being more risky. Adding to concerns, S&P downgraded
                                                      Belgium's credit rating to AA from AA+, citing concerns about funding and market
                                                      pressures. The S&P 500 fell 4.7%, giving back almost two-thirds of its gains in
                                                      October, the market's best month in 20 years. The Dow was off 4.8% for the week
                                                      and the Nasdaq fell 5.1%


                                                      European markets slumped and the euro hit a seven-week low on Friday, as
                                                      record borrowing costs for Italy stoked fears of lack of comprehensive policy
                                                      response to the spiraling euro zone debt crisis. Italy borrowed 10bn euros, paying a
                                                      euro-era high 6.5% to borrow over six months, almost double the yield at a similar
                                                      sale a month ago. Further the lukewarm response to the German 10 year bond
                                                      offering added to the concern. European stocks lost ground for the ninth time in 10
                                                      sessions and were on course to post their biggest weekly loss in two months. The
                                                      FTSE was down 0.7% and has lost about 13% since late October.


                                                      Asian stocks declined rounding out a losing week as statements by German and
                                                      French officials failed to convince investors that leaders were closer to a consensus
                                                      on how to contain the euro-zone debt crisis. The Nikkei after earlier falling to a fresh
                                                      two-and-a-half-year low closed 2.6% down for the week. Hang Seng fell 4.3%
                                                      posting their fourth straight weekly loss as investor cut their risks. Shanghai
                                                      Composite fell 1.5% its third straight weekly loss.



                                                                 1
                India Sectoral Performance
India's largest truck maker by sales Tata Motors rose 0.8%. Tata Motors
introduced a new version of the Nano minicar which is more powerful and fuel
efficient than the previous model. India's largest commercial vehicle maker by
sales said it will continue to sell the Nano at the same price. The Nano, sold
in three variants, is priced between Rs 1.4 lakh and Rs 1.96 lakh at
showrooms in New Delhi. Tata Motors said the new version of the Nano will
have a fuel efficiency of 25.4 kilometers per litre, compared with 23.6
kilometers per liter of the previous variant. The new Nano is powered by a
624 cubic centimeter gasoline engine that will deliver 38 horsepower,
compared with 35 horsepower in the previous variant.


India's second largest software services exporter by revenue Infosys shed
5.0%. The company announced that it may miss the upper end of its sales
targets for Q3-FY11 and also for FY12 as the worsening global economic
situation has made large contracts hard to come by. At the time of
announcing Q2 FY11 results Infosys had forecasted 3.2% to 5.3% growth in
revenue at $1.802 to $1.84bn in Q3FY11 over Q2FY11. The company had
projected 17.1% to 19.1% growth in revenue at $7.08bn to $7.20bn for the
FY12 over the year ending FY11. In rupee terms Infosys had forecast 8.97%
to 11.2% growth in revenue at Rs 88.3bn to Rs 90.1bn in Q3FY11 over
Q2FY11. The company had projected 21.8% to 24% growth in revenue at Rs
335.0bn to Rs 340.9bn in FY 2012 over FY 2011.


Bharti Airtel fell 5.7%. The company announced that Akhil Gupta, a non-
executive director, sold 65,500 shares for Rs 26.1mn. Mr. Gupta is also the
deputy group chief executive and managing director of Bharti Enterprises, the
parent company of Bharti Airtel. Mr. Gupta now holds 2.4mn Bharti Airtel
shares along with his wife. Also, Manoj Kohli, chief executive of Bharti Airtel's
international business and the company's joint managing director, sold 50,000
shares for Rs 19.9mn on 18 November 2011. Mr. Kohli now owns 253,000
shares in Bharti Airtel.


Shares of organized retailers surged after the Union Cabinet cleared a
proposal to allow 51% foreign direct investment (FDI) in multi-brand retail and
increase in FDI in single brand retail to 100% from current 51%. Pantaloon
Retail India (up 18.0%), Shoppers Stop (up 11.2%), and Trent (up 2.5%),
surged. Currently, India allows 51% FDI in single brand retail and 100% FDI
in cash and carry format of the business. The move to liberalize FDI norm in
retail signals that the Indian government, after years of prevaricating over
allowing greater foreign investment in several sectors, is now serious about
attracting overseas funds.




          2
                                                           India Economics
CHART 1: FOOD INFLATION RISES   India’s food inflation eased significantly for the third consecutive week,
                                raising expectations of a cool off in headline inflation. The wholesale price
                                index for food articles rose 9.01% from a year earlier, compared with a
                                10.63% gain in the previous week. On a week-on-week basis, the food
                                articles index fell 0.7% to 198.5 as prices of most commodities, including
                                protein-rich products, showed a modest decline. The sharp deceleration
                                reflects a much-anticipated downtrend in prices, which is expected to
                                become more pronounced by December when the statistical base would
                                turn favorable and food supplies will get a boost with the arrival of the
                                summer-sown crops.
                                Food inflation has remained elevated for several months due to soaring
                                prices of protein-rich foods such as meat, fish and milk that have seen

Source: Newswire18              increased consumption amid growing prosperity in the country.




                                     3
Global Market View – Concerted
policy action required
It has been another volatile and challenging month for asset
markets. Equities gave up earlier gains as policy makers failed to
come up with solutions to the debt challenges in the western world
and the growth outlook deteriorated, particularly in Europe.
Interestingly, global bond markets have failed to counter this
weakness as contagion spread to Italy and France. Commodity
markets were also lower, led by agricultural prices


MACRO OVERVIEW
In the West, we remain in the muddle through/mild recession environment
In Asia, a hard landing is still likely to be avoided
Quantitative easing likely in both the US and Europe in 2012
European policy makers need to step up to the plate given contagion to Italy,
France and now maybe Germany, and signals of tightening bank lending
standards going forward


EQUITIES
Theme: Large capitalisation, high dividend yielding stocks with excellent
franchises, defensive business models, exposure to emerging market
growth and trading at attractive valuations


FIXED INCOME
Retain underweight positioning on 3m and 12m basis
UW investment grade debt on both a 3m and 12m basis
OW corporate high yield on a 3m and 12m basis


COMMODITIES
Gold: We remain structurally bullish on gold, although we have been
highlighting the likelihood of a short-term correction to 1600-1650 area,
offering a buying opportunity
Oil: Likely to remain supported on geopolitical concerns


CURRENCIES
USD likely to remain strong near-term on heightened risk aversion




             4
Biocon
Delivering value through affordability and innovation
OUTPERFORM, BIOS IN, Price Target Rs370

  Marquee partnerships with Pfizer and Mylan validate biotech strengths and
  medium-term visibility.
  IER expects Research Services/licensing incomes to drive 15% revenue
  CAGR and better profitability in services to stabilize core margins at 25-26%
  despite increased R&D.
  Domestic sales are likely to continue to drive biopharma sales with
  increased formulation and Pfizer sales offsetting lower statin growth due to
  continuing Lipitor genericization.
  Incremental capex of US$450-500m over FY12-14 is fully funded by Pfizer
  and internal accruals; option of strategic deployment of free cash.
  IER initiates with Outperform and a PT of Rs370


  Global partnerships validate biotech strengths. Biocon’s strength in
  insulin and MAbs is paying dividends with marquee partnerships with Pfizer
  (insulin) and Mylan (MAbs). Domestic insulin and potential ‘first in class’ EU
  approvals in FY13 for insulin provide visibility to medium-term growth.


  Research Services and licensing lead growth. We expect 15% revenue
  CAGR over FY11-14E, led by Research Services (16% CAGR) and Pfizer
  licensing (Rs10bn by FY14). Recent calibration in services to higher value
  addition (eg, biologics) is paying off, and improved profitability should aid
  core margins to stabilize at 25-26% despite increased R&D in multiple
  projects (EU/US insulin, novel projects, Mylan).


  Domestic segment drives growth. Biocon’s biopharma sales (74% of
  sales) has been India-focussed (domestic revenue posted 23% CAGR over
  FY06-11). Ex-licensing, we expect biopharma sales to post 12% CAGR over
  FY11-14E, with lower growth in statins due to Lipitor generics offsetting
  gains in domestic formulations and upside from Pfizer insulin supplies.


  Fully funded for medium-term growth. Biocon’s incremental capex of
  ~US$450-500m over FY12-14 is fully funded mainly due to Pfizer
  (US$350m) and internal accruals, giving the company options for strategic
  deployment of its free cash.


  Valuations. 12-month PT of Rs370 valuing Biocon at 20x P/E (10-20%
  discount to larger peers like SUNP, CIPLA, DRRD), the average of the stock
  in the past 18 months. Potential upside from out-licensing and potential
  listing of Research Services businesses in 4-6 quarters provide upside to
  IER estimates.
  Key risks. Higher R&D impacting short-term margins, potential lower
  milestones, lower Research Services off-take.




              5
                                             Economic Calendar
◄ Oct 2011                                                                                            Dec 2011 ►
                                             ~ November 2011 ~
   Sunday            Monday          Tuesday         Wednesday           Thursday      Friday         Saturday
                                        1                 2                3          4                   5
                                                                                    Bank deposits     WMA and
                                                                                    and credit as    forex
                                                                                    on Oct 21, by    reserves
                                                                                    RBI              as on Oct
                                                                                                     28, by RBI
     6                7                 8                  9              10         11                  12
                                    Automobile       Major port                     Primary          Cement
                                    sales data       traffic in                     articles         production,
                                    for              October, by                    inflation rate   dispatches
                                    October,         Indian Ports                   for week to      in October,
                                    by SIAM          Association                    Oct 29, by       by CMA
                                                                                    commerce
                                                                                    and industry     Foreign
                                                                                    ministry         tourist
                                                                                                     arrivals in
                                                                                    Index of         Oct, by
                                                                                    Industrial       tourism
                                                                                    Production for   ministry
                                                                                    September, by
                                                                                    CSO

    13                14                15                16              17         18                  19
                WPI inflation for   Power                                           CPI for rural,
                Sep, by             generation for                                  urban areas
                commerce and        October, by                                     and combined
                industry ministry   Central                                         for October,
                                    Electricity                                     by CSO
                                    Authority

    20                21                22                23              24            25               26
                CPI for rural       GSM                                              Crude,
                and farm            mobile                                          refinery
                labourers for       subscribers                                     output for
                October, by         data for                                        Oct, from
                Labour              Aug, by                                         petroleum
                Ministry            COAI                                            ministry

    27          28                      29                30
                                    Government       Core sector
                                    finances for     growth for
                                    Oct, Apr-Oct,    October, by
                                    by CGA           commerce
                                                     ministry

                                                     GDP growth
                                                     estimate for Jul-
                                                     Sep, and Apr-
                                                     Sep, by CSO




Source: Newswire18




                                                         6
                              INDIA EQUITY RESEARCH COVERAGE LIST
                                                 (Price Target is for 12-Month Investment Horizon)

                                                                                                     Initiation Price as on IER fair % Up /downside
Sr. No. Country Stock Name            BB code            Sector                     Recommendation   Price      25/11/2011 value     to IER fair value
  1       IN   Ashok Leyland          AL IN Equity       Automobiles & Parts        OUTPERFORM          72.0        24.7       34.0         37.7%
  2       IN   Bajaj Auto             BJAUT IN Equity    Automobiles & Parts        OUTPERFORM        1390.0      1639.3      1630.0        -0.6%
  3       IN   Hero Motor Corp.       HH IN Equity       Automobiles & Parts        UNDERPERFORM      1785.0      1756.9      1876.0         6.8%
  4       IN   Mahindra & Mahindra    MM IN Equity       Automobiles & Parts        IN-LINE            611.0       706.3      700.0         -0.9%
  5       IN   Maruti Suzuki          MSIL IN Equity     Automobiles & Parts        OUTPERFORM        1218.0       950.1      1485.0        56.3%
  6       IN   Tata Motors            TTMT IN Equity     Automobiles & Parts        OUTPERFORM         198.2       171.9      253.8         47.7%
  7       IN   TVS Motor              TVSL IN Equity     Automobiles & Parts        IN-LINE             71.5        60.9       68.0         11.8%
  8       IN   Apollo Tyres           APTY IN Equity     Automobiles & Parts        OUTPERFORM          64.0        63.3       80.0         26.5%
  9       IN   Exide Industries       EXID IN Equity     Automobiles & Parts        IN-LINE            163.0       114.9      160.0         39.3%
  10      IN   Amara Raja Batteries   AMRJ IN Equity     Automobiles & Parts        IN-LINE            178.0       212.3      172.0         -19.0%
  11      IN   Motherson Sumi         MSS IN Equity      Automobiles & Parts        OUTPERFORM         186.0       149.5      265.0         77.3%
  12      IN   Amtek Auto             AMTK IN Equity     Automobiles & Parts        OUTPERFORM         128.0       121.3      210.0         73.1%
  13      IN   Bharat Forge           BHFC IN Equity     Automobiles & Parts        OUTPERFORM         380.0       265.8      450.0         69.3%
  14      IN   Bosch                  BOS IN Equity      Automobiles & Parts        IN-LINE           6211.0      7030.7      6682.0        -5.0%
  15      IN   Coal India             COAL IN Equity     Basic Resources            IN-LINE            318.9       308.8      338.0          9.5%
  16      IN   ACC                    ACC IN Equity      Construction & Materials   OUTPERFORM         971.0      1119.4      1170.0         4.5%
  17      IN   Ambuja Cement          ACEM IN Equity     Construction & Materials   IN-LINE            136.0       146.7      159.0          8.4%
  18      IN   Grasim Industries      GRASIM IN Equity   Construction & Materials   OUTPERFORM        2200.0      2262.4      2754.0        21.7%
  19      IN   India Cements          ICEM IN Equity     Construction & Materials   OUTPERFORM         112.0        69.2      134.0         93.8%
  20      IN   Shree Cement           SRCM IN Equity     Construction & Materials   OUTPERFORM        2096.0      2052.7      2280.0        11.1%
  21      IN   Ultra Tech             UTCEM IN Equity    Construction & Materials   IN-LINE           1041.0      1117.7      1127.0         0.8%
  22      IN   Tata Steel             TATA IN Equity     Construction & Materials   IN-LINE            635.0       374.1      506.0         35.3%
  23      IN   JSW Steel              JSTL IN Equity     Construction & Materials   UNDERPERFORM      1205.0       556.8      1048.0        88.2%
  24      IN   SAIL                   SAIL IN Equity     Construction & Materials   OUTPERFORM         179.0        82.1      146.0         77.8%
  25      IN   Hindustan Zinc         HZ IN Equity       Construction & Materials   OUTPERFORM         127.3       113.2      157.0         38.8%
  26      IN   Sterlite Industries    STLT in Equity     Construction & Materials   OUTPERFORM         164.0       100.1      212.0        111.9%
  27      IN   Hindustan Aluminium    HNDL IN Equity     Construction & Materials   OUTPERFORM         209.5       113.5      174.0         53.3%
  28      IN   National Aluminium     NACL IN Equity     Construction & Materials   UNDERPERFORM       102.0        51.8       67.0         29.5%
  29      IN   Asian Paints           APNT IN Equity     Consumer                   OUTPERFORM        2726.0      2942.8      3350.0        13.8%
  30      IN   Kansai Nerolac         KNPL IN Equity     Consumer                   IN-LINE            900.0       872.0      922.0          5.7%
  31      IN   GAIL (India)           GAIL IN Equity     Oil & Gas                  OUTPERFORM         499.0       384.8      508.0         32.0%
  32      IN   Reliance Industries    RIL IN Equity      Oil & Gas                  OUTPERFORM        1069.0       753.8      969.0         28.5%
  33      IN   ONGC                   ONGC IN Equity     Oil & Gas                  OUTPERFORM         329.0       251.9      355.0         41.0%
  34      IN   Oil India              OINL IN Equity     Oil & Gas                  OUTPERFORM        1417.0      1167.3      1602.0        37.2%
  35      IN   IOCL                   IOCL IN Equity     Oil & Gas                  OUTPERFORM         399.0       265.8      364.0         37.0%
  36      IN   HPCL                   HPCL IN Equity     Oil & Gas                  UNDERPERFORM       464.0       281.2      370.0         31.6%
  37      IN   BPCL                   BPCL IN Equity     Oil & Gas                  IN-LINE            736.0       517.3      596.0         15.2%
  38      IN   Indraprastha Gas       IGL IN Equity      Oil & Gas                  OUTPERFORM         293.0       390.8      446.0         14.1%
  39      IN   Petronet LNG           PLNG IN Equity     Oil & Gas                  OUTPERFORM         113.0       154.7      184.0         19.0%
  40      IN   Infosys Technologies   INFO IN Equity     Technology                 OUTPERFORM        3203.0      2600.6      2290.0        -11.9%




                                                                               7
                                                                                                            Initiation   Price as on   IER fair % Up /downside
Sr. No. Country Stock Name                 BB code            Sector                       Recommendation   Price        25/11/2011    value to IER fair value
  41      IN   TCS                         TCS IN Equity      Technology                   IN-LINE             1104.0      1063.0       1280.0       20.4%
  42      IN   Wipro                       WPRO IN Equity     Technology                   OUTPERFORM           458.0       369.6       475.0        28.5%
  43      IN   HCL Technologies            HCLT IN Equity     Technology                   OUTPERFORM           448.0       386.6       620.0        60.4%
  44      IN   Patni Computers             PATNI IN Equity    Technology                   IN-LINE              483.0       444.9       480.0        7.9%
  45      IN   Mahindra Satyam             SCS IN Equity      Technology                   OUTPERFORM           74.0        65.0         87.0        33.9%
  46      IN   Tech Mahindra               TECHM IN Equity    Technology                   IN-LINE              667.0       559.5       720.0        28.7%
  47      IN   Bharti Airtel               BHARTI IN Equity   Telecommunications           OUTPERFORM           340.0       375.2       465.0        24.0%
  48      IN   Idea Cellular               IDEA IN Equity     Telecommunications           OUTPERFORM           72.0        95.7        106.0        10.8%
  49      IN   Reliance Communication      RCOM IN Equity     Telecommunications           IN-LINE              125.0       69.6         89.0        28.0%
  50      IN   ITC                         ITC IN Equity      Personal & Household Goods   IN-LINE              171.0       192.3       210.0        9.2%
  51      IN   Hindustan Unilever          HUVR IN Equity     Personal & Household Goods   OUTPERFORM           303.0       375.2       366.0        -2.5%
  52      IN   Nestle                      NEST IN Equity     Personal & Household Goods   IN-LINE             3726.0      4192.1       4280.0       2.1%
  53      IN   Colgate Palmolive India     CLFT IN Equity     Personal & Household Goods   UNDERPERFORM         845.0       982.8       858.0       -12.7%
  54      IN   GSK Consumer                SKB IN Equity      Personal & Household Goods   IN-LINE             2171.0      2495.0       2461.0       -1.4%
  55      IN   Marico                      MRCO IN Equity     Personal & Household Goods   IN-LINE              125.0       147.3       152.0        3.2%
  56      IN   P&G Hygiene & Healthcare    PGHH IN Equity     Personal & Household Goods   UNDERPERFORM        1698.0      1860.9       1626.0      -12.6%
  57      IN   Britannia                   BRIT IN Equity     Personal & Household Goods   OUTPERFORM           368.0       474.7       512.0        7.9%
  58      IN   DLF                         DLFU IN Equity     Real Estate                  OUTPERFORM           227.0      203.7        266.0        30.6%
  59      IN   Unitech                     UT IN Equity       Real Estate                  IN-LINE              38.0        23.1         33.0        42.9%
  60      IN   Oberoi Realty               OBER IN Equity     Real Estate                  OUTPERFORM           238.0       220.0       300.0        36.4%
  61      IN   HDIL                        HDIL IN Equity     Real Estate                  OUTPERFORM           160.0       65.1        250.0       284.0%
  62      IN   Indiabulls Real Estate      IBREL IN Equity    Real Estate                  OUTPERFORM           112.0       63.1        166.0       163.1%
  63      IN   Sobha Developers            SOBHA IN Equity    Real Estate                  OUTPERFORM           273.0       231.3       362.0        56.5%
  64      IN   Prestige Estates Projects   PEPL IN Equity     Real Estate                  OUTPERFORM           109.0       83.7        151.0        80.5%
  65      IN   Titan Industries            TTAN IN Equity     Retail                       OUTPERFORM           170.5       189.6       282.0        48.7%
  66      IN   Aurobindo Pharma            ARBP IN Equity     Healthcare                   OUTPERFORM           198.0       92.8        215.0       131.8%
  67      IN   Cadila Healthcare           CDH IN Equity      Healthcare                   IN-LINE              790.0       760.2       925.0        21.7%
  68      IN   Cipla                       CIPLA IN Equity    Healthcare                   IN-LINE              324.0      316.0        315.0        -0.3%
  69      IN   Dr Reddy's Laboratories     DRRD IN Equity     Healthcare                   OUTPERFORM          1644.0      1539.8       1725.0       12.0%
  70      IN   Lupin                       LPC IN Equity      Healthcare                   OUTPERFORM           417.0      469.7        515.0        9.7%
  71      IN   Sun Pharmaceuticals         SUNP IN Equity     Healthcare                   IN-LINE              444.0       491.9       490.0        -0.4%
  72      IN   Torrent Pharmaceuticals     TRP IN Equity      Healthcare                   IN-LINE              583.0       552.8       630.0        14.0%
  73      IN   LIC Housing Finance         LICHF IN Equity    Finance                      IN-LINE              226.8      212.55       210.0        -1.2%
  74      IN                              MGFL IN
               Manappuram General Finance & LeasingEquity     Finance                      OUTPERFORM           66.55       53.25        91.0        70.9%
  75      IN   Allahabad Bank              ALBK IN Equity     Finance                      IN-LINE              222.0       145.9       245.0        68.0%
  76      IN   Axis Bank                   AXSB IN Equity     Finance                      OUTPERFORM          1424.0      967.3        1400.0       44.7%
  77      IN   Bank of Baroda              BOB IN Equity      Finance                      OUTPERFORM           983.0       724.7       1055.0       45.6%
  78      IN   Bank of India               BOI IN Equity      Finance                      UNDERPERFORM         487.0       329.4       395.0        19.9%
  79      IN   HDFC                        HDFC IN Equity     Finance                      UNDERPERFORM         706.0      613.8        640.0        4.3%
  80      IN   HDFC Bank                   HDFCB IN Equity    Finance                      OUTPERFORM           472.0      430.9        525.0        21.8%




                                                                                   8
                                                                                                                Initiation   Price as on   IER fair % Up /downside
Sr. No. Country Stock Name                  BB code             Sector                         Recommendation   Price        25/11/2011    value to IER fair value
  81      IN   ICICI Bank                   ICICIBC IN Equity   Finance                        OUTPERFORM          1101.0       718.2       1310.0       82.4%
  82      IN   IDFC                         IDFC IN Equity      Finance                        IN-LINE              157.0       106.5       125.0        17.4%
  83      IN   IndusInd Bank                IIB IN Equity       Finance                        IN-LINE              280.0       260.5       315.0        20.9%
  84      IN   M&M Financial Services       MMFS IN Equity      Finance                        OUTPERFORM           795.0       614.3       825.0        34.3%
  85      IN   Punjab National Bank         PNB IN Equity       Finance                        OUTPERFORM          1188.0       880.4       1230.0       39.7%
  86      IN   State Bank of India          SBIN IN Equity      Finance                        IN-LINE             2425.0      1690.6       2650.0       56.7%
  87      IN   Shiram Transport             SHTF IN Equity      Finance                        OUTPERFORM           819.0       504.1       800.0        58.7%
  88      IN   Union Bank                   UNBK IN Equity      Finance                        IN-LINE              342.0       217.4       330.0        51.8%
  89      IN   Yes Bank                     YES IN Equity       Finance                        OUTPERFORM           330.0       274.1       310.0        13.1%
  90      IN   Escorts                      ESC IN Equity       Automobiles & Parts            OUTPERFORM           137.0       77.8        181.0        132.8
  91      IN   Gujarat State Petronet       GUJS IN Equity      Oil & Gas                      IN-LINE              104.0       84.8        105.0        23.8%
  92      IN   Mundra Ports and SEZ         MSEZ IN Equity      Infrastructure                 OUTPERFORM           152.0       123.4       201.0        63.0%
  93      IN   Essar Ports                  ESRS IN Equity      Infrastructure                 OUTPERFORM           106.0       69.3        180.0       159.7%
  94      IN   Gujrat Pipavav Port          GPPV IN Equity      Infrastructure                 OUTPERFORM            64.0       60.0         71.0        18.3%
  95      IN   Marg                         MRGC IN Equity      Infrastructure                 OUTPERFORM           96.0        81.2        163.0       100.7%
  96      IN                                  OFSS
               Oracle Financial Services Software IN Equity     Technology                     OUTPERFORM          2026.0      2005.9       2550.0       27.1%
  97      IN   Dabur India                  DABUR IN Equity     Personal & Household Goods     OUTPERFORM           105.2       96.0        120.0        25.0%
  98      IN   Glenmark Phatmaceutical      GNP IN Equity       Health Care                    OUTPERFORM           325.0       316.9       390.0        23.1%
  99      IN   Opto Circuits                OPTC IN Equity      Health Care Equipment & Services OUTPERFORM         231.6       212.0       310.0        46.2%




                                                                                      9
                                                        TECHNICAL FOCUS
CHART 1: SENSEX DAILY CHART
                                On weekly basis, it was the fourth consecutive negative closing as Nifty and
                                Sensex ended the week with heavy fall of 4.1% and 4.2% respectively. Broader
                                market faced relentless selling pressure through out this week.


                                Sensex is almost trading near its lower band of the channel where it might find
                                some buying interest. 16000 - 15800 would be considered as an important support
                                zone for Sensex. We expect a technical pull back from the current level. Overall
                                Sensex would continue to trade in a range of 15800 – 18000 in medium term.


                                As per the Sensex Daily Chart, Sensex was unable to clear its resistance around
                                18000, formed by the trendline connecting the previous tops. The pullback rally
                                from 15700 onwards appears to have terminated closer to the 17900 mark which is
                                also the 61.8% Fibonacci retracement level of the last fall from 19100 to 15700.
                                However we might expect a technical pullback from 16000 level as short term
                                major momentum indicators are trading in an deeply oversold zone. Any bounced
CHART 2: SENSEX WEEKLY CHART    back rally could be restricted to 17000 level where it might face fresh selling
                                pressure. As long as Sensex stays below 18000 level, we would continue to
                                maintain our negative view for medium term perspective.


                                As per the Sensex Weekly Chart, we observed the rally ended closer to the upper
                                band of the falling channel line drawn in chart 2. The chances of the Index
                                surpassing the 18000 mark look quite dim. It is likely to trade within the downward
                                channel with negative bias as trend remains down.


                                As per the Sensex Monthly Chart, the long term trend is expected to maintain the
                                pattern drawn in the chart. We currently have entered a phase of a broader
                                consolidation with the upper end at 20000 and lower end around 12700 to 10000.
                                The Index is expected to consolidate and base before the next leg of the rally
                                begins. With the longer term consolidation phase we are currently witnessing a
                                phase of correction as we may make lower highs and lower lows.
CHART 3: SENSEX MONTHLY CHART
                                Oscillator Screening:
                                As per the Sensex daily chart, RSI is trading near oversold region as seen in Chart
                                1. Weekly RSI found resistance from its trendline and is gradually falling. The RSI
                                momentum indicator on the Sensex Monthly Chart appears weak and has been
                                drifting lower towards the oversold band.


                                To conclude, Sensex might find some buying interest around its lower band of the
                                range of 16000 – 15800 level in the short term. Any pullback from this support level
                                could be restricted to 17000 level where it might witness selling pressure and might
                                serve as an opportunity to position for the another downside leg.



Source: MetaStock




                                    10
                                                          TECHNICAL FOCUS


                               The BSE Auto Index was unable to hold on to it gains and once again it is heading
                               towards the lower band of the range. Index has strong support near 8100 level
CHART 4: BSE BANKEX
                               where we expect a technical bounce back. Within the Auto Index the two wheelers
                               would continue to outperform as compared to four wheeler segments.

                               The Bankex index is trading near it’s lower band of the downward channel. We
                               expect a technical bounce back from the current level. Within the Banking sector
                               the Private sector banks appear to relatively better off then their PSU counterparts.

                               The Capital Goods Index has underperformed the benchmark Indices. Though
                               we might see some technical pull back as going with the overall view on the
                               market, but Sector would continue to underperform in the medium term.

                               The Consumer Durables Index also appears to be consolidating within a broad
                               range of 7000 to 5500. The Index has corrected from the upper band of the range
                               and gradually heading towards lower band of the range as short term trends are
                               negative. We expect a technical bounce back from this lower band of the trading
                               range.

                               The FMCG Index saw some profit booking on two consecutive weeks after
CHART 5: BSE OIL & GAS INDEX   touching near all time high level. The trend remains positive however the risk
                               reward is unfavourable and declines would be safer bet to enter. 3800 will act as a
                               near term support level.

                               The Healthcare Index might continue to be a market performer in near term and
                               stock specific buying could be witnessed.

                               The IT Index faced selling pressure around its downward resistance line. The
                               sector would be a market out-performer and stock specific further buying could be
                               witnessed after technical correction.

                               The Metal Index has witnessed a sharp sell off and the Index is witnessing
                               significant momentum on the downside. Index might find support near the long
                               term upward trend line as seen in Chart 6. Sector would continue to underperform
                               in the short term.

                               The Oil & Gas Index is gradually drifting lower and is likely to see some technical
                               recovery in the near term. Supports lies around the 7500 mark. However the
                               medium term trend still remains down
Chart 6: BSE METAL INDEX
                               The Power Index will continue to underperform going forward.

                               The Realty Index has been gradually drifting lower and is at an all time low level
                               i.e. 1340. The index will continue to underperform in the near term.

                               The Technology Index appears to a defensive bet in these volatile times. It is
                               likely to out perform in the short term.




                                    11
: Source: MetaStock
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Strategists:                                                                                    Editor:
Nishit Sheregar –Strategist                                                                     Sirshendu Basu – Head, Consumer Equity Strategy
Email: Nishit.sheregar@sc.com                                                                   Email: Sirshendu.basu@sc.com

Soumen Das – Senior Technical Strategist
Email: soumen.das@sc.com



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