WEEKLY REPORT

Key developments during the week

•S&P cuts India long‐term rtg outlook citing concern overfisc, debt

• Moody's affirms stable rtg on India local, foreign currencybond

• Pranab says rule to tax foreign M&A deals not likely to hurtFDI

• Cabinet minister says no plan to deregulate diesel prices

• Industry secy says consultations on FDI in aviation still on

• Source says Birla Shloka to ink content sharing pact with UK co Wed

• Transgene to co‐develop Canadian co's reproductive cancerdrug

• Gujarat Gas signs agreement with GSPC Gas for assetsexchange

• Strides buys S India sterile formulations unit for 1.25 blnrupee

• Hinduja group's Gulf Oil Corp begins development ofBengaluru SEZ

• IIFCL head says got provisional SEBI OK for setting up infra debt fund

• Federal Bank cuts Base Rate by 20 bps to 10.45% from May 2

• Reliance Ind, partners agree to relinquish KG‐D9 block

• Bharat Forge JV gets order worth 15.7 bln rupees from NTPC

• Maruti Suzuki to invest 20‐24 bln rupees in Rohtak R&D facility

Domestic events week ahead

• Apr 30: CPI for Industrial Workers for March, by Labour Bureau.

• May 1: HSBC Manufacturing PMI for April, by Markit Economics.

• May 1: Trade data for March, by commerce and industry ministry.

• May 1: Automobile sales data for April, by SIAM.

• May 1: Cement production, despatches in April, by CMA.

• May 3: HSBC Services PMI for April, by Markit Economics.

Global events week ahead

•Apr 30: German Retail Sales m‐o‐m & M3 Money Supply y‐o‐y of Europe

• May 01: Manufacturing Purchasing Manager’s Index (PMI) of Britain, The Institute for Supply Management

    Manufacturing Purchasing Managers' Index (PMI) of US

• May 02: Unemployment Rate of Europe, Crude Oil Inventories of US

• May 03: French Industrial Production m‐o‐m, Unemployment Claims of US

• May 04: Retail Sales m‐o‐m of Europe, Unemployment Rate of US

Weekly Sector Outlook and Stock Picks

Pharma sector ‐ In range with negative bias this week

Shares of drug makers are likely to remain rangebound with a negative bias this week, taking cues from the broad market1 ahead of corporate earnings in early May. The street is likely to remain bullish on Ranbaxy Laboratories Ltd, Lupin Ltd and Dr Reddy's Laboratories Ltd on stock specific expectations.

Capital Goods sector ‐ To track broad market this week

Shares of capital goods and engineering companies are likely to track the broad market, which is seen trading with anegative bias this week. Any action would be stock specific. These stocks may see slight upside on Monday on the back of better‐than‐estimated results posted by the sector major Siemens Ltd post‐market hours last week. In the current subdued economic scenario and the slowdown in the capital goods and engineering companies, Siemens results may revive the market in the short term. Siemens last week posted nearly 11% rise in its net profit for Jan‐Mar on the back of higher sales. Revenues during the quarter grew nearly 24%.

FMCG Sector ‐ Rangebound with negative bias; earnings eyed

Shares of fast‐moving consumer goods companies are seen rangebound with a negative bias this week. Any movementmay be stock specific based on Jan‐Mar earnings. Hindustan Unilever, Marico, and Dabur India are scheduled to detail their quarterly earnings on May 1, May 3, and Apr 30, respectively. Volume growth is a key factor for the companies as they hiked product prices several times during Jan‐Mar. While Hindustan Unilever hiked prices of soaps and detergents, Marico undertook price hikes in the edible oil portfolio. Jan‐Mar performance will be critical as the companies may provide guidance for the next two quarters, which will help investors take call on these counters. While profitability is expected to expand year‐on‐year, sales volume growth could be strained. Ability of consumers to absorb price hikes and sustain demand seems to be weakening. Last week, the BSE FMCG index lost 0.4%, while benchmark indices the National StockExchange's Nifty and the BSE's Sensex lost 1.55% and 1% respectively.

Bank sector‐ Seen rangebound this week; Jan‐Mar earnings eyed

Shares of major banks are likely to move in a narrow range this week tracking mixed cues. Movement is likely to be stockspecific based on Jan‐Mar financial results. Sentiment for the sector is likely to get a boost from the better‐than‐ expected Jan‐Mar earnings posted by ICICI Bank and Axis Bank on Friday 27th April. ICICI Bank reported a 31% year‐on‐year rise in fourth‐quarter net profit at 19.02 bln rupees. Axis Bank is also likely to trade with a positive bias. The bank reported net profit of 12.77 bln rupees for Jan‐Mar. Investors are likely to keep a watch on shares of Oriental Bank of Commerce, andVijaya Bank, as they are scheduled to detail Jan‐Mar earnings on Monday Apr 30th. Bank of Baroda will announce their financial results on 4th May, which is expected to provide cues for the respective stock.

Cement Sector ‐ Seen down this week; Apr dispatches data eyed

Shares of major cement makers are seen negative this week as it is expected that the companies to start cutting prices of the commodity ahead of the low‐demand season. Typically, cement demand starts falling by May‐end as construction activity is halted due to the monsoon. Cement stocks have rallied significantly over the past four months as companies raised prices by 10‐25% across regions, helping them to pass on the pressure of rising input costs. Investors may take cues from cement despatches data for April, which will be detailed on Tuesday May 1st .

IT Sector ‐ To track broad market this week amid lack of cues

Shares of major information technology companies are seen range‐bound this week due to lack of sector‐specific triggers.Movement in IT stocks will depend on the broad market and investors have broadly factored in Jan‐Mar earnings that were posted by companies over the past two weeks, but there may be stock‐specific movement based on the results. Jan‐Mar earnings of top software majors gave mixed cues to investors. Infosys' tepid guidance for 2012‐13 (Apr‐Mar) raised fears of a likely slump across the sector, but Tata Consultancy Services' outlook for the year lifted sentiment, as the company said it was confident of topping industry body NASSCOM's estimate of a 11‐14% revenue growth. Even while top brass TCS and Wipro were confident about high growth this year but there are many uncertainties surrounding the sector.

Volatility in Indian rupee against the dollar is one of the variables that pose a continuous challenge for IT companies. After significant depreciation in Oct‐Dec, the Indian unit appreciated in Jan‐Mar, leading most companies to post foreign exchange losses for the latter quarter. Shares of KPIT Cummins and NIIT Technologies will remain in focus as the two midsized companies will detail their Jan‐Mar earnings this week.

Telecom Stocks Outlook:Bias weak this week; Bharti Airtel result eyed

Shares of telecom companies are seen trading with a weak bias this week as sentiment remains bearish after the Telecom Regulatory Authority of India recommended high reserve price of 36.22 bln rupees for the auction of 1 MHz of spectrum in the 1800 MHz band at a pan‐India level early last week. Shares of Bharti Airtel will be in focus this week, as the company will announce its Jan‐Mar earnings on Wednesday 2nd May. Jan‐Mar consolidated net profit of Idea Cellular declined 12.9% on year to 2.39 bln rupees, on account of high finance cost. The company announced its earnings on Thursday last week.

Oil Stocks Outlook: State‐owned refining, upstream cos seen subdued

Shares of state‐owned fuel retailers are likely to remain subdued this week as the government is unlikely to de‐regulate diesel prices anytime soon while a increase in prices of the fuel, and others like petrol and cooking gas, also appear dim. Continued weakness in the rupee, vis‐a‐vis the dollar, will also weigh on these stocks. The recent softening of crude prices will, however, support shares of the three companies‐‐Indian Oil Corp Ltd, Bharat Petroleum Corp Ltd and Hindustan Petroleum Corp Ltd.These companies are currently losing around over 14 rupees on sale of a litre of diesel. Even on petrol,the prices of which were deregulated in 2010, the companies are incurring a loss of over 8 rupees as the government indirectly forces these companies to desist from price hikes fearing popular resentment. The burden is huge and may result in significant losses for these companies in Apr‐Jun. The compensation for losses incurred by these companies in 2011‐12 (Apr‐Mar) may be announced in second half of May, just ahead of their earnings.The subsidy burden will also remain an overhang on upstream companies‐‐Oil and Natural Gas Corp, GAIL (India) Ltd and Oil India Ltd—w ho have to share a major portion of the revenue losses.Usually, these three companies share a third of the revenue losses but the government has raised it to 38.5% as well. That uncertainty may also keep investors away from the stocks for the time being.

Steel Sector: Weak this week amid econ uncertainties

Shares of major steel companies are seen weak in the next five sessions over concerns of economic uncertainties in Indiaamid slowdown in global economies. On the expiry of April contracts on Thursday, traders carried forward bearish bets tothe May series as they expect market prospects in the near term to remain gloomy. Standard & Poor's downgrade of outlook on India rating from 'stable' to 'negative' also added to the bearish sentiments. On Friday, Jindal Steel and Power posted better‐than‐expected Jan‐Mar earnings on the back of higher realisation and rise in sales volumes. The company's consolidated net profit rose 16.5% on year to 11.67 bln rupees and net sales were up 42% on year at 54.65 bln rupees. Market participant expect weakness in steel stocks to continue this week especially in JSW Steel, which continues

to struggle with raw material scarcity. JSW Steel's crude steel production in March fell 3% sequentially to 592,000 ton as it operated at 70% of production capacity. Although the company's crude steel output in Jan‐Mar rose 26% on year to 2.07 mln ton.

Market Range for Week 5050‐ 5380

NIFTY

Resistance – Nifty facing Resistance level @5250 level above this levelit may go up to @5320 &@ 5350 level.

 Support ‐ Support comes for market @5180 level for Nifty; below this level Nifty next support @5130 and @5080 will be the major support for Market.

Technical – Last week Nifty opened at 5277 & it made a high of 5310.Last week we have seen rangebound market with downside. Nifty made a low of 5154 & closed at 5209.Last week Nifty drag 156 points from its high & on weekly basis it closed at 81 point’s lower. Sensex made a weekly high of 17444 & a low of 17019 almost it drag 425 points in the week from its high.So overall last week we have seen some rangbound market with profit booking.

For the coming week the market range we expect 5050‐5380.

Weekly  View –

Last week we had expected market range (5150‐5450) & market made a high of 5310 & made a low of 5209, so overall it hold over both side. In last week report we had mentioned, on daily chart market was not able to cross 50DMA & downward slopping trendline. On weekly chart it was not able to cross 100WMA, because of all that we had mentioned 5350‐5360 will be major resistance unless not close above that we can see rangebound market & all we have seen same.Now on daily chart market near to 100 & 200DMA support level(5130) but at the same time not able to cross 50DMA. On weekly chart still taking support at upper trendline & facing resistance at 100WMA, from last 8 to 10 week we are trading in same range,

so unless we did not get any trigger we can see consolidation in the market & still 5350‐5380 will be major resistance &5180‐5130 will be support for market.

On Friday Dow jumped 28 points, or 0.2%, & the S&P500 rose 4 points, or 0.3%.The Nasdaq added 18 points, or 0.6%. Forthe week the Dow gained 1.5%. The S&P500 advanced 1.8% & the Nasdaq is 2.3% higher for the week.

Weekly Chart