Outlook and Valuation: We expect the valuations to continue to be at a premium the segment, size andthe market share of the company.

Asian markets are trading mixed as investors react to data from China which showed manufacturing activity expanding in September, with the Markit PMI coming in at 53.0. Nikkei is trading lower by 0.14%; Hang Seng is trading higher by 2%, and Shanghai is trading higher by 0.50%. Indian indices are ex

Asian markets are trading mixed tracking cues from Wall Street overnight. Nikkei is trading lower by 0.25%; Hang Seng is trading lower by 0.17%, and Shanghai is trading higher by 0.50%. Indian indices are expected to open in the green. Sgx Nifty is trading higher by 0.09%.

The nationwide lockdown impacted operations of the majority of chemical companies in 1QFY21, but the pick-up was rapid in 2Q. Plants are currently operating at the utilisation of 70-90% of the pre-COVID level. Plant utilisations of companies that cater to end-user industries engaged in essential services such as pharmaceuticals and agrochemicals are higher. Companies are continuing with their Capex plans despite the implications of the COVID-19 pandemic, owing to a positive demand outlook. Most of the companies believe that the Indian chemical industry is in a sweet spot given: (1) the opportunity arising out of 'China Plus One' policy of MNCs and the government, (2) rising domestic demand, and (3) export opportunity. We hosted a CXO-Chemical Conference-2020 and invited senior management of seven listed chemical and agrochemical companies and an industry expert.

Raising target prices again; Medium term commentary turning more positive Through this note we have raised estimates and target prices of our coverage universe yet again after doing it earlier in our 6th September 2020 note (Rising monetary and digital tides lifting most boats). This follows widespread positive commentary across companies in September 2020 that near term demand is stronger than earlier anticipated on accelerated digital adoption. On top of this, we see some cross-currency tailwind, which would add 100-200bps to QoQ growth across most of our coverage universe in 2QFY21. We have also finetuned our estimates for a few acquisitions that have been announced. In September 2020, CEOs of many companies in the sector have made statements to the effect that they are seeing strong demand not only over the next 12-18 months but also beyond that. While we would be cautious on taking all of these statements...

The quick economic recovery witnessed across Advanced and Developing economies has become patchy

We witnessed a correction in Equity market after 6 months of long rally. Since, the rally was long and consistent we saw that the correction was also steep of around 8.5% from peak in Nifty. We saw correction across the world and across asset classes during last one month. The correction was also led by the appreciation of dollar against other major currencies indicating risk aversion. Economy, which had started improving from total lockdown, has reached to a level from where it is becoming difficult to further improve in the absence of solution for increasing COVID cases, fear among consumer to freely come out, reduction in spending power and intermittent lockdowns in different parts of the country. Now, the country needs a solution and a stimulus to kick start the growth in economy. As the possibility of approval for one of the Vaccines for COVID is close, we may see positive sentiment on account of the same in near term. This along with festive demand in India and some type of stimulus can help further improvement in economy. US market will also look at development on Presidential Election where the Democrat leader Joe Biden is leading as compared to Current President, Trump. Joe Biden has indicated in his Election manifesto that he will reverse the corporate tax cut bought in by Trump in 2017. This may keep the sentiment low in the Equity market in US. Till the positive news on Vaccine comes, market may continue to remain side ways. We expect NIFTY to remain in...

MDS commands a monopoly status in high value segments like submarines and destroyers (just one competitor in destroyers). Also, until now MDS has been the only player capable of manufacturing large ships with Garden Reach Shipbuilders having recently emerged in this segment. The positive factors aiding healthy prospects for MDS include indigenization push by GoI, a wide product portfolio, robust order book to sales of 10.9x, rising share of the fast growing shipbuilding business (70% vs. 33% in FY17), long credible history of proven development capabilities, strong balance sheet and healthy return ratios. MDS is being offered at an attractive valuation of 4.5x FY20 EPS vs. 9-10x commanded by other listed defense PSUs having similar financial metrics. Thus we recommend subscribe' to the issue.

Automobile Sector Update: Festive season to lead recovery in Autos - 2W & Auto ancillaries in sweet spot; The recovery in the Automobile Industry has been faster than expected. The industry seems to be recovering from the negatives of Covid-19 impact on the back of robust rural economy

Accenture Q4 Result - Denotes strong demand for automation & Digital transformation: Accenture reported 4QFY20 cc revenues of USD10.8bn down 2.0% YoY (1% decline in cc terms) v/s street estimate of 1.2% YoY decline (flat in cc terms) and company guidance range +3% to -1% in cc terms.

Asian markets are trading in the green tracking cues from Wall Street while investors focus on the upcoming U.S. Presidential debate and an increase in coronavirus cases. Nikkei is trading higher by 0.72%; Hang Seng is trading higher by 0.59%, and Shanghai is trading higher by 0.06%. Indian indices

UTI AMC, the eighth largest AMC in India, is a dominant player in beyond T30 cities (B30) market. The growth for the company in last four years was largely driven by passive funds as it bagged chunky public investments in ETFs, pension and retirement funds. The Co witnessed steady healthy 15% QAAUM CAGR over the same period led by strong distribution franchise, sticky client base, strengths in managing retirement (2nd highest) and PMS funds. However lower yields on passive/alternate funds, higher cost structures and current pandemic led headwinds would cap near term return profile....

UTI AMC, the eighth largest AMC in India, is a dominant player in beyond T30 cities (B30) market. The growth for the company in last four years was largely driven by passive funds as it bagged chunky public investments in ETFs, pension and retirement funds. The Co witnessed steady healthy 15% QAAUM CAGR over the same period led by strong distribution franchise, sticky client base, strengths in managing retirement (2nd highest) and PMS funds. However lower yields on passive/alternate funds, higher cost structures and current pandemic led headwinds would cap near term return profile....

Early data for August'20 indicate that 42.2% indicators were in the positive territory, up from the 30% suggested by the early indicators in July'20. Final data for July'20 suggest that 34.69% indicators were in the positive territory. Overall, the improvement in economic indicators is steady. Reflecting the relative resilience of the rural sector, tractor sales were very strong, up by 74.7% YoY. Driven by the demand for personal mobility, two wheeler sales turned positive and were up by 3.2% YoY while passenger vehicle sales were up by 13.6% YoY. Government spending has been quite volatile and slowed to a 5.63% YoY growth in July'20 after a 45.7% YoY increase in June'20. Rural and urban unemployment inched up marginally in August'20 but are near pre-covid levels. Employment in the formal sector is witnessing far slower recovery and was down 35% YoY in August'20,...

Unlike the 5-8% local currency (LC) growth guidance that it used to start with in recent years (Exhibit 1), Accenture's guidance of 2-5% LC growth for FY21 (Aug YE) is slower and is a story of two halves with 1H growth likely in the -3% to 0% range followed by high single digit to low double-digit growth in 2H. This is due to impact of Covid-19. Among the assumptions driving a 2HFY21 pick up (which coincides with 1HFY22 of Indian players) are: (1) a pickup in macroeconomy (2) Strategy and consulting - discretionary spending - making a comeback (3) larger transformation programs being executed, and (4) base effect. Just as in FY20, when inorganic part was 2% out of a total of 4% growth in LC, FY21 too will see 2% being added. We...