DAILY MARKET OUTLOOK

India Alternative Research

Market Snapshot
On the back of weak global cues, Nifty ended lower by ~1.80% last Friday. The Sensex advance to decline was in the tune of 7:23. Large cap gainers were led by HUL (up ~2.5%) and Hero Motors (up ~2).The list of losers included Sterlite and Hindalco (down ~5.5% each) and JP Associates (down ~4.6%). We expect the Nifty to open lower today. If the index trades below the crucial levels of 4950 for a prolonged period intraday, then the likelihood of it drifting further downwards will increase. India IIP numbers will be declared today. In a major development overnight, Germany it appears may back out from its initial stance of assisting a Greece bail out. The US and European equity indices underwent sharp correction last Friday.
Yogesh Radke +91226620 3199 yogesh.radke@edelcap.com
Sep 12, 2011

Market Snapshot 09-Sep Nifty Sensex BSE MidCap BSE SmallCap Sep Futures Average ICC (p.a.)** Volume (INR mn) Fu tures Call 276,077 395,458 426,601 1 ,098,136 121,293 31,337 451,473 356,563 462,485 1 ,270,522 1.07 1.02 1.29 1.16 244,861 325,083 334,595 904,539 113,588 26,990 462,263 351,209 481,273 1,294,745 1.03 0.79 1.37 1.43 12.7 21.6 27.5 21.4 6.8 16.1 -2.3 1.5 -3.9 -1.9 4.1 29.2 -5.5 -19.2 4.8% 6.8% -2.0% 5059.5 16867 .0 6435.5 7304.0 08-Sep 5153.3 17165.5 6490.3 7359.3 % Chg -1.8 -1.7 -0.8 -0.8

Sentiment Indicators
For the September series, the maximum OI build up in options is seen at strikes of 5200 CE (~5.95mn shares) and 4700 PE (~7.45mn shares). Nifty IVs for September series is ~23% level.

Outlook
Just when the Nifty was inches away from testing the 5200 mark, it took a turn for the worse on the final day of the week, suffering from a dramatic fall as US President failed to cheer the street with his jobs package leading to a 1.82% loss. Fridays session has engulfed gains of the previous two sessions forming a strong bearish engulfing pattern. This will result in further losses in the early part of the week. Traded volumes were high and market breadth turned strongly in favour of declines leading to long liquidations and bears pressing shorts. For the week though, the markets have managed to close marginally in the green keeping the bulls hopeful of a resumption of shortterm uptrend after a retracement. With momentum oscillators holding the buy cross on daily chart, we expect Nifty to find support between 5000 / 4950 (key retracement cluster) where it could consolidate for few days before taking a direction. In case of a break below 4950, the index is at risk of challenging the recent low of 4720. Barring the Consumer Durables index all other sectoral indices shredded value. Biggest damage was seen in the Metals space followed by Banking and Oil & Gas shares that lost in the range of ~2.5 to 3%. Broader market indices put up a brave show outperforming the frontline index rout. We maintain our bearish call on the CNX BANK index at 9950 initiated on Friday with a stoploss above 10,000 (closing basis) and look for a downside target of 9340 from a positional perspective.

Put Total NSE Cash Vol. BSE Cash Vol. Open Interest (INR mn) Fu tures Call Put Total Put Call Ratios PCR WPCR OI PCR Total OI/ Volu me

Nifty IVs at 23 - 28% levels. FII Activity* (INR Mn) (8-Sep)

Volume Cash Index Futures Stock Futures Total

Buy 22,251 18,907 17,450 58,608

Sell 21,958 19,137 11,415 52,510

Net 293 (230) 6,035 6,098

Bullish Setups: HMCL, IDEA, SBIN, RIL, JPA, BJAUT Bearish Setups: GAIL, DRRD, ITC, STLT, CNXBANK, BHEL
Nifty: Resistance: 5100/5146 Support: 5030/4985

Edelweiss Research is also available on www.edelresearch.com, 1 Bloomberg EDEL <GO>, Thomson First Call, Reuters and Factset.

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F&O Dividend Update

STOCKS GOING EX TODAY Bloomberg Ticker JSP IN EQUITY POWF IN EQUITY

Company Name Jindal Steel & Power Ltd Power Finance Corporation

DPS 1.50 1.50

Ex Date 12Sep11 12Sep11

STOCKS GOING EX IN THE EXPIRY 26th Aug 29th Sept Bloomberg Ticker Company Name ABAN IN EQUITY Aban Offshore Ltd. ABGS IN EQUITY ABG Shipyard limited ABNL IN EQUITY Aditya Birla Nuvo Limited ALOK IN EQUITY Alok Industries Ltd. BHE IN EQUITY Bharat Electronics BGRL IN EQUITY BGR Energy Systems Limited DELTA IN EQUITY Delta Corp Ltd EDSL IN EQUITY Educomp Solutions Ltd FTECH IN EQUITY Financial Technologies (I) Ltd GMDC IN EQUITY Gujarat Mineral Development Coop Limited GUJS IN EQUITY Gujarat State Petronet Limited HNDL IN EQUITY Hindalco Industries Ltd. IBREL IN EQUITY Indiabulls Real Estate Limited IOCL IN EQUITY Indian Oil Corporation Ltd. IVRC IN EQUITY Ivrcl Infrastructure & Projects Ltd. JPA IN EQUITY Jaiprakash Associates Ltd. JI IN EQUITY Jain Irrigation Systems Limited JSAW IN EQUITY Jindal Saw Limited NACL IN EQUITY National Aluminium Co. Ltd. NMDC IN EQUITY NMDC Ltd OINL IN EQUITY Oil India Ltd. OPTC IN EQUITY Opto Circuits (India) Limited PTCIN IN EQUITY Ptc India Limited RCAPT IN EQUITY Reliance Capital Ltd RCOM IN EQUITY Reliance Communications Ltd. RELI IN EQUITY Reliance Infrastructure Limited RSI IN EQUITY Ruchi Soya Ltd SCI IN EQUITY Shipping Corporation Of India Ltd. SKNL IN EQUITY S Kumars Nationwide Ltd VIP IN EQUITY VIP Industries Ltd UNSP IN EQUITY United Spirits Ltd. STOCKS GOING EX IN THE EXPIRY 29th Sept 27th Oct Bloomberg Ticker Company Name PF IN EQUITY Pantaloon Retail (I) Ltd BM Board Meeting; BC Book Closure; RD Record Date

DPS 3.60 4.00 5.50 0.25 15.60 10.00 0.30 0.60 2.00 3.00 1.00 1.50 0.30 9.50 0.60 0.40 1.00 1.00 0.50 2.15 19.50 4.50 1.50 6.50 0.50 7.20 0.50 2.50 1.00 7.00 2.50

Ex Date 19Sep11 15Sep11 15Sep11 20Sep11 13Sep11 15Sep11 BC Sept 21 Sept 26 15Sep11 21Sep11 19Sep11 15Sep11 14Sep11 22Sep11 15Sep11 15Sep11 19Sep11 15Sep11 26Sep11 16Sep11 15Sep11 15Sep11 21Sep11 15Sep11 15Sep11 15Sep11 15Sep11 22Sep11 14Sep11 20Sep11 16Sep11 21Sep11

DPS 0.90

Ex Date BC Oct 21 Oct 22

Bloomberg Ticker
GTS IN EQUITY

Company Name
Gtl Ltd.

HCLT IN EQUITY PEC IN EQUITY RLTA IN EQUITY TCOM IN EQUITY

Hcl Technologies Ltd. Patel Engineering Ltd. Rolta India Ltd Tata Communications Ltd

DPS 1.00 2.00 1.00 3.50 2.00

Ex Date

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F&O Dividend Updatecont

Dividend Impact on current and next month futures Bloomberg Code HNDL IN Equity RELI IN Equity RCAPT IN Equity JSP IN Equity JPA IN Equity RCOM IN Equity Company Hindalco Industries Ltd Reliance Infrastructure Ltd Reliance Capital Ltd Jindal Steel & Power Ltd Jaiprakash Associates Ltd Reliance Communications Ltd

1.70
ExDate 14Sep11 15Sep11 15Sep11 12Sep11 19Sep11 15Sep11

points Div per Share (INR) 1.50 7.20 6.50 1.50 0.40 0.50 Impact in Nfity Weight in points Nifty 0.65 0.34 0.25 0.20 0.15 0.11 1.27 0.42 0.30 1.38 0.50 0.37

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Derivatives Daily
Futures Snapshot
Top OI Rises Scrip Colgate Palmolive GTL Ltd Exide Industries Jubilant Foodworks Lt Arvind Limited IOB Indiabulls Real Est. Lt Max India Ltd % OI Chg 34 25 18 16 16 12 12 11 OI 225 4,740 2,382 617 2,772 1,512 21,360 882 % Price Chg (2.6) 32.9 (4.0) (1.0) 8.2 (3.2) (1.6) 3.8 % Future Vol Chg 156 4705 33 12 259 (34) 51 183 Top OI Falls Scrip VIP Industries Ltd BF Utilities Limited South Indian Bank L GE Shipping Chambal Fertilizers Titan Industries Petronet LNG Gujarat Minerals Dev % OI Chg (18) (18) (15) (10) (8) (8) (8) (8) OI 617 249 1,800 315 6,560 9,008 3,678 600 % Price Chg (1.5) (2.3) 1.8 (0.3) (0.9) 1.5 (1.2) (2.6) % Future Vol Chg (27) 179 139 64 (39) 5 (24) 71

Top Price Change Scrip GTL Ltd GTL Infra Arvind Limited RCOM Mercator Lines Limited Ambuja Cements Hindalco SREI Infra. Finance % Price Chg 32.9 9.6 8.2 (6.3) (6.2) (6.1) (5.7) (5.5) % OI Chg 25 16 9 1 4 3 1 OI 4,740 2,772 22,832 8,784 13,050 16,412 6,320 % Future Vol Chg 4705 0 259 140 (30) 67 18 20

Top Volume Rises Scrip GTL Ltd Neyveli Lignite On Mobile Arvind Limited Deccan Chronicle Ho Opto Circuits (I) Ltd Hindustan Unilever NMDC Ltd % Future Vol FutureVol % Price Chg % OI Chg Chg 4705 315 281 259 240 199 185 185 26,070 274 1,698 11,072 708 433 6,379 333 32.9 (0.4) (0.8) 8.2 (1.6) 1.9 2.6 0.3 25 (1) 2 16 (3) (3) (4) (1)

Options Snapshot Most Active Calls Scrip NIFTY SBI Reliance GTL Ltd IFCI Ltd Top IV Premium Scrip NIFTY Nifty Unitech Idea Cellular SBI IVs 26 26 64 45 40 HVs 24 24 50 34 34 Call Vol 73,619 73,619 18,224 3,852 1,853 Put Vol 82,026 82,026 3,248 704 893 Call Volume (Contracts) 1,472,388 14,821 11,087 10,559 8,989 % Chg 25 66 14169 186 Put Volume (Contracts) 1,640,513 7,146 9,629 2,333 676 % Chg 31 158 10505 50 Most Active Puts Scrip NIFTY Reliance SBI Bank Nifty Tatasteel Top HV Premium Scrip NIFTY K S Oils Limited GTL Infra IRB Infrastructure Triveni Engineering IVs 26 HVs 24 160 74 72 70 Call Vol 73,619 6,224 0 0 0 Put Vol 82026 768 0 0 0 Put Volume (Contracts) 1,640,513 9,629 7,146 4,223 2,522 % Chg 31 158 69 Call Volume (Contracts) 1,472,388 11,087 14,821 3,793 4,417 % Chg 25 66 56 -

Nifty Watch Nifty IVs at 23 - 28% levels. Market Wide PCR up from 1.03 to 1.07 Nifty OI PCR down from 1.43 to 1.36 Nifty down 1.8%, Futures OI down 1% Nifty Sep futures trading at 7 points discount as against 2 points premium India VIX at 19.8% as against 18.73%

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