Equity View: The quarterly results which are coming out are in line with the expectations as we are now heading towards stickier end of the result season approaching Diwali. Companies who have not performed well may declare results between 7th Nov – 15th Nov, as the markets are on a holiday, so their results go unnoticed. People must keep a close eye on how sectors like Infra, Capital Goods, Manufacturing and Public Sector Banks will perform which will set the tone of the market. In PSU banks, a lot of assets were restructured proactively in 2013 when new chairman’s of different PSU banks took over. When banks restructure the assets once, then you cannot restructure again within 18 months. Thus, if that particular asset doesn’t become standard and start servicing interest and principal then it has to be termed as NPA (Non Performing Asset). The problem is that restructured assets are not being standard so it is better to stay away from PSU banks. On the global front, Chinese central bank has cut their interest rate and European central bank has kept interest rate at a very low level making things difficult for US Fed to take any action in December. Inflation is low in US but if adjusted for food and energy prices then it is closer to US Fed’s target of 2%. Unemployment rate of 5.1% is also near to US Fed’s target. So if they consider sentiments of Wall Street then it might be a very difficult decision to make in December. The recent Indian IIP numbers are good but we can see 3rd Quarter as a good one because festivals like Dusshera and Diwali are little late as compared to previous year. Government may have a shortfall of around 50,000 crore in tax collections and 30,000 crore in disinvestment plan so, 80,000 crore shortfall means 0.6% of GDP. This may lead to cut down in capital expenditure. Telecom sector typically is a value destroyer; it was a value creator till 2009 due to lack of proper government policies. Since the scandal broke out, now major expenditure for telecom companies is buying of spectrum. If a telecom company is having capex of 100 crore then entire 100 crore goes into acquisition of spectrum and equipment cost is huge in this field. We also have to keep in mind that equipment is suppose to be depreciate very fast because of obsolesce of technology. Hence, considering all factors, return on capital employed in this sector is below 10%. News: DOMESTIC MACRO:  World Bank predicts that remittances to India will increase by 2.5% this year.  Foreign investors have pumped in over Rs 19,000 crore in the Indian capital markets in October so far - the highest level in six months – backed by a rate cut by Reserve Bank of India (RBI) and positive macro numbers.  Indians invested nearly $2 billion in the Dubai's real estate during the first half of this year.

1. The World This Week
October 19 – October 24, 2015

2. Equity View:
The quarterly results which are coming out are in line with the expectations as we are now heading
towards stickier end of the result season approaching Diwali. Companies who have not performed well
may declare results between 7th
Nov – 15th
Nov, as the markets are on a holiday, so their results go
unnoticed. People must keep a close eye on how sectors like Infra, Capital Goods, Manufacturing and
Public Sector Banks will perform which will set the tone of the market.
In PSU banks, a lot of assets were restructured proactively in 2013 when new chairman’s of different PSU
banks took over. When banks restructure the assets once, then you cannot restructure again within 18
months. Thus, if that particular asset doesn’t become standard and start servicing interest and principal
then it has to be termed as NPA (Non Performing Asset). The problem is that restructured assets are not
being standard so it is better to stay away from PSU banks.
On the global front, Chinese central bank has cut their interest rate and European central bank has kept
interest rate at a very low level making things difficult for US Fed to take any action in December.
Inflation is low in US but if adjusted for food and energy prices then it is closer to US Fed’s target of 2%.
Unemployment rate of 5.1% is also near to US Fed’s target. So if they consider sentiments of Wall Street
then it might be a very difficult decision to make in December.
The recent Indian IIP numbers are good but we can see 3rd
Quarter as a good one because festivals like
Dusshera and Diwali are little late as compared to previous year. Government may have a shortfall of
around 50,000 crore in tax collections and 30,000 crore in disinvestment plan so, 80,000 crore shortfall
means 0.6% of GDP. This may lead to cut down in capital expenditure.
Telecom sector typically is a value destroyer; it was a value creator till 2009 due to lack of proper
government policies. Since the scandal broke out, now major expenditure for telecom companies is
buying of spectrum. If a telecom company is having capex of 100 crore then entire 100 crore goes into
acquisition of spectrum and equipment cost is huge in this field. We also have to keep in mind that
equipment is suppose to be depreciate very fast because of obsolesce of technology. Hence, considering
all factors, return on capital employed in this sector is below 10%.

3. News:
DOMESTIC MACRO:
 World Bank predicts that remittances to India will increase by 2.5% this year.
 Foreign investors have pumped in over Rs 19,000 crore in the Indian capital markets in October so far - the
highest level in six months – backed by a rate cut by Reserve Bank of India (RBI) and positive macro
numbers.
 Indians invested nearly $2 billion in the Dubai's real estate during the first half of this year.
 Country's foreign exchange reserves increased by $458 million to $353.527 billion in the week to October
16, on account of rise in foreign currency assets.
GLOBAL MACRO
EURO
 The European Central Bank (ECB) kept its interest rates on hold for the tenth policy session in a
row. The ECB kept the deposit rate unchanged at -0.20% and the marginal lending rate at 0.30%.
 Preliminary data from Markit Economics showed that Euro zone's private sector grew at the fastest
pace in two months during October.
 Eurozone manufacturing PMI was 52 in October, steady compared to September.
United States
 The U.S. housing starts rose 6.5% to an annual rate of 1.206 million in September from the
revised August estimate of 1.132 million. The increase was attributed to a surge in multifamily
starts that jumped 18.3% to a rate of 466,000 in September from 394,000 in August.
 US manufacturing purchasing managers’ index (PMI) was 54 in October, up from 53.1 in September.
China
 The People's Bank of China lowered interest rates for the sixth time since November. It has
lowered the one-year benchmark bank lending rate by 25 basis points to 4.35% with effect from
October 24. The one-year benchmark deposit rate was also lowered by 25 bps to 1.50%.
Indices:
Date Sensex Midcap Auto Bankex CD CG FMCG HC IT Metals O&G Power Realty Teck
19/10/15 27,365 11,124 18,436 20,389 11,791 16,056 8,045 18,391 11,126 7,556 9,380 1,927 1,459 6,132
20/10/15 27,307 11,184 18,491 20,371 11,846 16,047 8,028 18,331 11,237 7,420 9,313 1,953 1,450 6,178
21/10/15 27,288 11,167 18,541 20,215 11,839 15,881 8,028 18,189 11,284 7,507 9,262 1,948 1,424 6,213
23/10/15 27,471 11,138 18,406 20,478 11,858 15,634 8,115 18,256 11,325 7,532 9,337 1,955 1,424 6,188
0.39% 0.13% -0.16% 0.44% 0.57% -2.63% 0.87% -0.74% 1.79% -0.32% -0.46% 1.46% -2.41% 0.92%

4. Commodities and Currency:
Date USD GBP EURO YEN
Crude
(Rs. per BBL)
Gold
(Rs. Per 10gms)
19/10/2015 64.81 100.11 73.74 54.36 3278 26711
20/10/2015 64.89 100.39 73.52 54.33 3151 26852
21/10/2015 65.15 100.53 73.97 54.31 3161 26906
22/10/2015 - - - - 3117 -
23/10/2015 64.88 99.88 72.06 53.79 3132 26764
-0.11%
Rupee
Depreciated
0.23%
Rupee
Appreciated
2.33%
Rupee
Appreciated
1.06%
Rupee
Appreciated
-4.45% 0.20%
Debt:
Tenor Gilt Yield in % (Friday) Change in bps (Week)
1-Year 7.17 -2
2-Year 7.44 1
5-Year 7.65 1
10-Year 7.59 2

5. Phani Sekhar Ponangi Jharna Agarwal
Nupur Gupta Ridhdhi Chheda Aakash Mehta
Disclaimer
The information and views presented here are prepared by Karvy Private Wealth (a division of Karvy Stock Broking
Limited) or other Karvy Group companies. The information contained herein is based on our analysis and upon sources
that we consider reliable. We, however, do not vouch for the accuracy or the completeness thereof. This material is for
personal information and we are not responsible for any loss incurred based upon it.
The investments discussed or recommended here may not be suitable for all investors. Investors must make their own
investment decisions based on their specific investment objectives and financial position and using such independent
advice, as they believe necessary. While acting upon any information or analysis mentioned here, investors may please
note that neither Karvy nor any person connected with any associated companies of Karvy accepts any liability arising
from the use of this information and views mentioned here.
The author, directors and other employees of Karvy and its affiliates may hold long or short positions in the above-
mentioned companies from time to time. Every employee of Karvy and its associated companies are required to disclose
their individual stock holdings and details of trades, if any, that they undertake. The team rendering corporate analysis
and investment recommendations are restricted in purchasing/selling of shares or other securities till such a time this
recommendation has either been displayed or has been forwarded to clients of Karvy. All employees are further restricted
to place orders only through Karvy Stock Broking Ltd.
The information given in this document on tax are for guidance only, and should not be construed as tax advice. Investors
are advised to consult their respective tax advisers to understand the specific tax incidence applicable to them. We also
expect significant changes in the tax laws once the new Direct Tax Code is in force – this could change the applicability
and incidence of tax on investments
Karvy Private Wealth (A division of Karvy Stock Broking Limited) operates from within India and is subject to Indian
regulations.
Karvy Stock Broking Ltd. is a SEBI registered stock broker, depository participant having its offices at:
702, Hallmark Business plaza, Sant Dnyaneshwar Marg, Bandra (East), off Bandra Kurla Complex, Mumbai 400 051 .
(Registered office Address: Karvy Stock Broking Limited, “KARVY HOUSE”, 46, Avenue 4, Street No.1, Banjara Hills,
Hyderabad 500 034)
SEBI registration No’s:”NSE(CM):INB230770138, NSE(F&O): INF230770138, BSE: INB010770130, BSE(F&O):
INF010770131,NCDEX(00236, NSE(CDS):INE230770138, NSDL – SEBI Registration No: IN-DP-NSDL-247-2005, CSDL-SEBI
Registration No:IN-DP-CSDL-305-2005, PMS Registration No.: INP000001512”