Vol.

: 343
05 JUNE ,2017

Index

Market View 1
M AR K E T V I E W
Company Update 2
T H E E F F E C T O F D E M O N E T I Z AT I O N O N G D P G R O W T H S E E M S
Around the
T E M P O R AR Y
Economy 3

Knowledge Corner 3 The Market was eagerly waiting for the full year GDP Growth figure
for the year 2016-2017. The full year GDP growth is little bit below ex-
Mutual Fund 4
pectation. The effect of Demonetization in the last quarter of the year is
Commodity Corner 5 the main reason for the weakness in the full year GDP growth. It was ex-
pected that the construction activity will be hit hard after demonetiza-
Forex Corner 6
tion. But the market is also convinced that reduction in GDP growth rate
Report Card 7 in quarter four is purely temporary and the same is getting revived. The
Current data of Auto mobile sales have put behind the effects of de-
Short Term Call Status 8
monetization and first quarter corporate results to be announced will
Editor & Contributor have minimum / no effect of demonetization. It is true that the liquidity
Darshana Mishra and gradual shift in investment habit of retailers towards Equity are the
main driver of the current market rally. From the view point of historic

Special Contributors data , the market looks costly and a healthy correction is warranted. But
Kunal Shah good news from all fronts of the Economy including good rain expecta-
Dhaval Ghodasara tions are keeping the market with positive bias.

Technically, there is strong support at 9550 / 9500 9340.

Higher side Resistance is at 9670 9725 range.

For suggestions, feedback

and queries
jstreet@jhaveritrade.com

Kamal Jhaveri
MD- Jhaveri Securities

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Company Update : MANAPPURAM FINANCE LTD

Company Basics Financial Basics Share Holding Pattern
BSE Code 531213 FV (`) 2.00 Holder's Name % Holding
EPS (`) (TTM) 7.64 Promoter 34.45
NSE Symbol Manappuram P/E (x) (TTM) 11.66 Public 65.55

EQUITY (` in Cr.) 84 P/BV (x) (TTM) 2.74

MKT.CAP (` in Cr.) 7497

Outlook and valuation : We recommend BUY on the stock BUY rating for the stock and value MGFL at
SoTP valuations, with gold business at 3.0x P/BV, micro-finance at 4.2x P/B FY18E. Subse-
quently, our target price stands at INR 130.

Company Overview :
Manappuram Finance Ltd (Formerly known as Manappuram General Finance and Leasing Ltd) is a non-banking
finance company. The company provides a range of services, including gold loans, vehicle finance, insurance, for-
eign exchange services, distribution of mutual funds and other financial products. The company currently operates
through more than 1000 branches spread across the country. During the year 1994-95, the company opened new
branches in Calicut, Guruvayur, Ernakulam and Thriprayar. In the year 2002, they started Forex business as a
part of its diversification.

Investment rationale for Manappuram Finance Ltd

Despite the impact of demonetization, Manappuram Finance (MGFL) recorded an all-round performance for Q3FY17 with PAT at
INR 2.036 bn (increased 101.5% on Y-o-Y basis and 52% on Q-o-Q basis) largely led by robust increase in Net interest in-
come (increased 53% on Y-o-Y basis and 6.8% on Q-o-Q basis) and controlled operating expenses (increased merely 9.6% on Y- o-
Y basis).

Product diversification strategy and rising gold loan volumes (gold holdings up 11% Y-o-Y; with large focus on-line gold loan product)
coupled with improved gold loan quality and greater thrust on collections emerging from rapidly improving microfinance segment
boosted the earnings for the quarter.

The share of new businesses (microfinance, mortgage and housing and commercial vehicle financing) increased to 15% in
Q3FY17 of overall AUMs.

Asset quality largely stable: With stressed legacy gold portfolio behind and MGFL focusing on shorter tenure products, laying
greater emphasis upon regular interest collections and tightened recognition norms, the asset quality stands as one of the best in
the industry.

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Around The World

Weekly Market Recap :

The headline Nikkei India Manufacturing Purchasing Managers' Index (PMI) dropped to a 3-month low of 51.6 in May from
52.5 in April. India's GDP rose at moderated pace of 6.1% in Q4 March 2017, which is the lowest pace of growth in last nine
quarters. The GDP growth decelerated sharply from 7% growth recorded in the preceding last quarter and 8.7% surge
posted in the corresponding quarter last year.

Overseas, data released by the private payroll firm ADP on Thursday, 1 June 2017, showed that private US companies hired
at a blistering pace in May, accelerating from the pause in April. Non-farm private employment surged 253,000 in May.

Market Eye Week ahead :

The major domestic event next week is RBI's monetary policy meeting scheduled at 14:30 IST on Wednesday, 7 June 2017.
Markit Economics will unveil the result of a monthly survey on the performance of India's services sector in May 2017 at 10:30
IST on Monday, 5 June 2017. The IMD in its press release on Friday, 2 June 2017, said that conditions are favourable for fur-
ther advance of southwest monsoon into remaining parts of south Arabian Sea, Lakshadweep area and Kerala, some parts of
central Arabian Sea.

Among global cues, UK Services Purchasing Managers Index (PMI) data will be unveiled on Monday, 5 June 2017. In US,
the Institute of Supply Management (ISM) Non-Manufacturing Purchasing Managers' Index (PMI) (also known as the ISM
Services PMI) data will be unveiled on Monday, 5 June 2017.

Key Events / Factors to Watch

1. Mon : Dividend: Gruh Finance, ITC
2. Tue : Dividend: IRB Infra
3. Wed : Monetary policy, RBI
4. Thu: Dividends:BPCL, ICICI Bank,Torerent power
5. Fri : Dividends: Kitex Garment, rallis india

Knowledge Corner :
DEBENTURES

A type of debt instrument that is not secured by physical assets or collateral.

Why Debenture?

Debentures are backed only by the general creditworthiness and reputation of the issuer. A debenture is an un-
secured form of investment. They are a useful to raise money for short period of time.

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Mutual Fund Corner

Top 10 Sector Break-Ups
Fund Name
Sector Weights Fund (%)
Scheme Name DSP BLACKROCK MICRO CAP FUND
Financial 8.38
AMC DSP Blackrock Investment Managers Textile 11.49
Con.Durable 4.14
Type Open Ended & Equity Small Cap
Healthcare 6.87
Category Open-ended FMCG 5.72
Launch Date January 2013 Services 3.97
Metals 6.15
Fund Manager Vinit sambhare & Vinit Kothari Mar 2013 Construction 10.01
Net Assets (` Engineering 7.80
Rs. 5824.5 cr as on Apr 30, 2017
In crore ) Chemicals 21.05
History 2014 2015 2016 2017 Risk Analysis
Volatility Measures
NAV (Rs) 37.17 45.07 51.19 62.63
Standard Deviation 16.99
Total Return (%) 103.13 21.24 13.58 22.35 Sharpe Ratio 1.64
Beta 0.98
Rank (Fund/Category) 4/50 2/36 1/34 19/24
R-Squared 0.58
Alpha 22.27
52 Week High (Rs) 37.17 45.07 56.10 -

52 Week Low (Rs) 17.49 36.80 36.69 -

Composition (%)
Equity 93.96
Net Assets (Rs.Cr) 1623.67 2233.01 4115.12 4966.78 Debt 0.00
Cash 6.04
Expense Ratio (%) 1.91 1.71 1.79 -

Fund Performance v/s Bse 200 Fund Style

Investment Style
Growth Blend Value
Large
Capitalization

Medium

Small

Fund
S&p bse small cap
(Rebased to 10,000) Source : - www.valueresearchonline.com

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Commodity Corner

BULLION
FUNDAMENTAL: Bullion prices last week seen under pressure where Gold prices steadied and Silver prices dropped by 3.01% tracking
weakness in base metals and crude oil prices as investors awaited the first-round of voting in the presidential French election at the
weekend and possible announcements about tax changes in US. There was potential for safe-haven buying of gold after France said
security forces were fully mobilized for the weekend vote after an Islamist militant killed a policeman Thursday night. Safe-haven demand
re-emerged after a French policeman was shot dead and two others were wounded in central Paris on Thursday night in an attack
claimed by the Islamic State militant group. Investors were also watching events in Washington. President Donald Trump's administra-
tion will unveil a tax reform plan soon and expects it will be approved by Congress this year, Treasury Secretary Steven Mnuchin
said.After reporting a bigger than expected drop in U.S. existing home sales in the previous month, the National Association of Realtors
released a report showing that existing home sales rebounded to their highest level in ten years in March.

RECOMMENDATION : BUY GOLD @ 28500 SL 28300 TGT 28900-29200 BUY SILVER @38900 SL 38200 TGT 39650-40400

BASE METALS
FUNDAMENTAL: Last week, base metals prices remained under pressure except aluminium prices ended with 1.22% gains after news
that Xinjiang Jiarun Resources shut down 200,000 mt of disqualified aluminium capacity. Aluminium Prices seen supported in the week
as supporting prices was the inventory draws from London Metal Exchange warehouses, but a rise in Shanghai stocks on Friday limited
this bullish sentiment. Still, overall LME holdings are sitting at just 1.7 million tons. Inventories in Shanghai, meanwhile, are at their high-
est in about a year. Meanwhile, Chinas total March aluminium production rose to 2.707 million tons from 2.534 million in February. Alu-
minium production typically picks up in pace as spring approaches, tracking the seasonal pick-up in construction demand. While others
dropped where lead and nickel dropped over 3% and others too dropped as worries over political instability and global demand
prompted investors to cut bets on higher prices. Investors have overestimated global growth and the impact of supply disruptions at ma-
jor copper mines.

RECOMMENDATION : BUY ALUMINIUM @ 123.5 SL 120 TGT 126.5-129 BUY COPPER @ 366 SL 360 TGT 372-78 BUY ZINC @ 165.50 SL
162 TGT 170-173 BUY NICKEL @ 595 SL 570 TGT 615-630

ENERGY

FUNDAMENTAL : Last week, energy prices ended with losses where crude oil prices dropped by 6.20% on renewed concerns that in-
creasing U.S. production and high inventories will thwart OPEC's attempts to reduce the global crude glut. Prices fell as doubts emerged
over the effect of the OPEC/non- OPEC production cut by almost 1.8 million barrels per day (bpd) during the first half of the year. Saudi
Arabia and Kuwait, key members of the Organization of the Petroleum Exporting Countries, favour extending their production-limiting
deal with non-member producers into the second half of the year. Russia's Energy Minister Alexander Novak, however, declined to say
whether the top oil producer would adhere to an extension before a joint meeting on May 25, saying global stocks were declining. "The
situation has gradually been improving since the beginning of March," Novak said. Demand for crude oil is however set to rise in the
coming weeks as refineries around the world return from seasonal maintenance ahead of peak summer demand.

RECOMMENDATION : BUY CRUDE @ 3200 SL 3080 TGT 3340-3450 BUY NAT.GAS @ 206 SL 197.5 TGT 215.50-224

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Commodity Corner
Forex Corner
Market Recap :

The rupee opened and touched a high of 64.32 a

dollar, a level last seen on 17 May, the rupee was
trading at 64.34, up 0.17% from its Fridays close
of 64.44.

The 10-year bond yield was trading at 6.612%

compared to its previous close of 6.627%. Bond
yields and prices move in opposite directions.

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 64.80-64.50 with SL of 65.20 for target of
64.31-64.08.

USD/INR
Level S2 S1 CP R1 R2 High Low Close
USD/INR 64.31 64.48 64.70 64.87 65.09 64.93 64.54 64.64

EUR/INR
Level S2 S1 CP R1 R2 High Low Close
EUR/INR 71.89 72.24 72.59 72.88 73.17 72.82 72.18 72.59

GBP/INR
Level S2 S1 CP R1 R2 High Low Close
GBP/INR 82.34 82.75 83.16 83.57 83.98 83.58 82.76 83.15

JPY/INR
Level S2 S1 CP R1 R2 High Low Close
JPY/INR 57.47 57.76 58.18 58.47 58.89 58.60 57.89 58.05

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J Street Recommendations Report Card

NIFTY last week opened at 9560.05, attained a low at 9547.70 and moved up to 9653.50. NIFTY finally closed the
week at 9653.50 thereby showed a net rise of 0.61%.Hold long position with a stop loss of 9300. Expect higher range
of 9750-9827-9876 to be tested. Overall expect Nifty to move towards 10500.Weaker opening and intra-week correc-
tion to 9624-9576-9499 can be used for buying with a stop loss of 9300.
Top Fundamental Stocks
Absolute
Stocks Rec. Date CMP on Rec. CMP Target Return @ Status
CMP
Petronet 20/02/2017 443 438 490 11% Buy
Escorts 06/02/2017 716 681 590 87% Buy
Edelweiss financial 16/01/2015 178 178 175 52% Profit Book

IOC Ltd 27/02/2017 415 416 470 10% Buy

Marico 20/02/2016 322 317 340 26% Buy

Voltamp transformer 13/02/2017 1263 1222 1120 29% Buy

Mothersumi 03/04/2017 456 445 440 21% Buy

Lic hsg Finc 27/03/2017 731 704 720 20% Buy

Asian Paints 10/03/2017 1162 1148 1180 13% Buy
Nbcc india 20/03/2017 196 196 210 12% Buy
Alembic Pharmaceuti-
30/08/2016 541 538 732 -14% Buy
cals
Wonderla 25/04/2016 373 375 498 -4% Buy

Mold Tek Pack 04/04/2016 49 48 179 0% Buy

Welspun syntex/AYM 23/11/2015 82 79 223 -32% Buy

Ahluwalia contracts 24/08/2015 345 375 368 47% Buy

Infinite Computer Sol. 20/07/2015 209 209 255 10% Buy

Sadbhav Engineering
04/05/2015 313 318 430 5% Buy
Ltd.
M&M 12/01/2015 1420 1354 1450 15% Buy
PTC India Fin. Ser. 07/07/2014 43 45 45 10% Profit book

Focus on Quality, Rather than Quantity, of Stocks.

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J Street Short Term Call Status

Sr. BUY/ TRIGGER %
No.
DATE STOCK RANGE RANGE TGT SL STATUS
SELL PRICE RETURN
1 19-Apr-17 COALINIA SELL 283 278 280.50 267.00 290 EXPIRE .

2 20-Apr-17 POWERGRID BUY 208 212 210.00 221.00 201 SL -3.6

3 21-Apr-17 APOLLOTYRE BUY 237 243 240.00 253.00 229 TA 4.8

4 24-Apr-17 DABUR BUY 287 293 290.00 306.00 279 SL -3.4

5 25-Apr-17 BHARATFORG BUY 1130 1142 1136.00 1186.00 1096 EXPIRE .

6 26-Apr-17 GODREJIND BUY 532 541 536.50 563.00 516 TA 4.6

7 27-Apr-17 ITC BUY 289 292 290.50 304.00 281 SL -3.6

8 2-May-17 GAIL BUY 420 425 422.50 441.00 408 EXPIRE .

9 3-May-17 ARVIND BUY 406 414 410.00 426.00 395 TA 4

10 4-May-17 ONGC BUY 188 192 190.00 202.00 181 SL -3.8

11 5-May-17 EXIDEIND BUY 235 240 237.50 251.00 228 TA 4.2
12 8-May-17 CADILAHC BUY 462 466 464.00 484.00 452 TA 4.2

13 9-May-17 INFY BUY 938 946 942.00 982.00 914 TA 4.2

14 10-May-17 GODREJIND BUY 562 572 567.00 594.00 546 TA 4.3

15 11-May-17 NIITECH BUY 523 532 527.50 554.00 507 TA 4.4
16 12-May-17 AMARAJABAT BUY 917 928 922.50 964.00 894 EXPIRE .

17 15-May-17 TVSMOTORS BUY 510 520 515.00 543.00 497 TA 4.3

18 16-May-17 GRASIM BUY 1166 1180 1173.00 1226.00 1134 SL -3.8

19 17-May-17 RAYMOND BUY 785 795 790.00 828.00 763 SL -3.6

20 18-May-17 PIDILITIND BUY 770 780 775.00 812.00 749 TA 4.2
21 19-May-17 WIPRO BUY 520 530 525.00 551.00 503 TA 4.4

22 22-May-17 MOTHERSUMI BUY 425 435 430.00 452.00 411 TA 4.1

23 23-May-17 ZEEL BUY 512 522 517.00 545.00 498 OPEN .

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J Street Short Term Call Status

BUY/ TRIGGER %
Sr. No. DATE STOCK RANGE RANGE TGT SL STATUS
SELL PRICE RETURN
24 24-May-17 M&M BUY 1320 1335 1327.50 1387.00 1282 TA 4.2

25 25-May-17 MINDTREE BUY 508 514 511.00 536.00 492 TA 4.3

26 29-May-17 TATASTEEL BUY 507 514 510.50 535.00 491 OPEN .

HEROMO-
27 30-May-17 BUY 3650 3685 3667.50 3830.00 3544 TA 4.3
TOCO
28 31-May-17 GODREJIND BUY 608 614 611.00 638.00 589 OPEN .

29 1-Jun-17 IBULHSGFIN BUY 1140 1160 1150.00 1205.00 1108 OPEN .

30 2-Jun-17 M&M BUY 1420 1440 1430.00 1498.00 1378 OPEN .

STATUS CALLS RATIO

TA+PB 15 71.43

SL+EXIT 06 28.57

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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