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Friday, January 19, 2007

Auto, IT and metal stocks punctured


The market settled in the red as profit-booking dominated proceedings in an extremely volatile day of trades. Brisk selling in autos, IT and metal stocks weighed heavily on the benchmark index.

The 30-shares BSE Sensex lost 35.04 points, ending at 14,182.71.

The BSE benchmark index had opened with a spurt, at 14,271.24, and surged to a high of 14,300.11, buoyed by stronger-than-expected results of index heavyweight Reliance Industries (RIL) and a fall in global crude oil prices. However, selling began soon enough and continued till the benchmark index slipped to 14,067.52.

The S&P CNX Nifty lost 18.55 points, to finish at 4,090.50.

After remaining strong in the past couple of sessions, the market-breadth also succumbed to profit-booking. For 1,642 shares declining, 1,030 advanced and 41 remained unchanged on BSE.

The total turnover on BSE amounted to Rs 4126 crore.

Among the 30-Sensex pack, 19 declined while the rest advanced.

Reliance Communications was the top gainer, up 3.11% to Rs 449.90, on a volume of 14.79 lakh shares. The stock recovered sharply from a low of Rs 431, also attaining a high of Rs 450.

Gujarat Ambuja Cements advanced 2.24% to Rs 148.50, anticipating strong results from the company.

Cigarette maker ITC gained 1.77% to Rs 175, on a volume of 11 lakh shares.

Index heavyweight Reliance Industries rose 0.88% to Rs 1379, on a volume of 12.75 lakh shares. It had also surged to an all-time high of Rs 1409, in early trade. RIL reported 57.6% surge in net profit in December 2006 quarter to Rs 2799 crore from Rs 1776 crore, much ahead of market expectations, after trading hours on Thursday. Net sales rose 45.7%, from Rs 18168 crore to Rs 26472 crore.

RIL’s gross refining margin stands at $11.7 a barrel, much higher than Singapore refining margins during the quarter. However, margins in the petrochemicals business declined during the quarter. "Robust economic growth along with a stable operating environment promises a positive outlook for all our businesses," the company said in a statement.

During the quarter, RIL doubled the estimated natural gas output from its field in the Krishna-Godavari basin to 80 million cubic metres a day, when it starts production in the second half of the fiscal year to March 2009.

ICICI Bank advanced 1.46% to Rs 986. It recovered sharply from its low of Rs 955.40. There are reports that Sangli Bank's merger had hit a roadblock as minority shareholders move to CBL against promoters.

Satyam Computers was the top loser, down 5.75% to Rs 485.70, on 26.91 lakh shares. The stock plunged to a low of Rs 476, as results belied expectations. It had surged to a high of Rs 524.90 in opening trade. Satyam Computer Services reported 5.45% sequential growth in consolidated net profit in December 2006 quarter, to Rs 337.23 crore, compared to a net profit of Rs 319.81 crore in September 2006 quarter. Net profit was within estimates. Operating profit rose 13.1% on a sequential basis, from Rs 362.49 crore to Rs 409.99 crore. Operating profit beat market expectations.

Consolidated sales rose 3.7% on a sequential basis, from Rs 1601.88 crore to Rs 1661.12 crore. Consolidated net sales growth was below market expectations. Five brokerages had forecast 4.9 - 6.7% sequential growth, between Rs 1680 crore and Rs 1708.90 crore.

Ranbaxy (down 3.77% to Rs 414), ONGC (down 2.68% to Rs 892.25) and Wipro (down 3.23% to Rs 620.25) were the other chief losers.

Reliance Energy (REL) lost 2.89% to Rs 512.90. Its Q3 December total income rose Rs 1,820 crore (Rs 1,137 crore), while net profit advanced to Rs 201 crore (Rs 164 crore).

The BSE IT index was the biggest loser among the BSE sectoral indices, down 98.63 points (1.82%), to 5,309.84. Financial Technologies (down 3.65% to Rs 1798), Hexaware (down 2.44% to Rs 177.90), TCS (down 1.66% to Rs 1293), Infosys Technologies (down 0.93% to Rs 2199) and Mphasis BFL (down 0.26% to Rs 290) edged lower.

The BSE Auto index was down 73.23 points (1.29%), at 5,619.82. M&M (down 3.20% to Rs 936), Bajaj Auto (down 2.11% to Rs 2725), Maruti Udyog (down 0.78% to Rs 911), TVS Motor Company (down 0.75% to Rs 79.30), and Punjab Tractors (down 1.15% to Rs 240), had slipped.

The BSE Metal index lost 96.58 points (1.06%), at 8,972.95. Hind Zinc (down 3.03% to Rs 768), Welspun Guj Stahl Rohren (down 2.84% to Rs 109.35), Jindal Saw (down 2.04% to Rs 436.50), SAIL (down 2.28% to Rs 96.50), and Ispat Industries (down 3.27% to Rs 15.40) declined.

OCL India jumped 3.64% to Rs 185, after its board approved demerger of the sponge iron and real estate operations into separate companies. OCL India reported 339.10% spurt in Q3 December 2006 net profit to Rs 17.7 crore, compared to Rs 4 crore in Q3 December 2005. Net sales rose 33% to Rs 225 crore (Rs 173 crore).

Dena Bank lost 4.4% to Rs 38.70, after the state-run bank posted 15% fall in net profit for the December 2006 quarter. Dena Bank posted 15% drop in net profit to Rs 70.53 crore in December 2006 quarter from Rs 83.18 crore in December 2005 quarter. Dena Bank’s net interest income rose 3% to Rs 209.79 crore (Rs 203.58 crore). Other income rose 16.7% to Rs 166.32 crore (Rs 142.51 crore).

Tech Mahindra plunged 6.88% to Rs 1769.50. On a sequential basis, Tech Mahindra’s consolidated profit-after-tax (PAT) before write back of tax provision grew 17% to Rs 166.70 crore. Consolidated revenue rose 10% on a sequential basis to Rs 769.80 crore. The contribution of British Telecom (BT) rose to 65% (64% in September 2006 quarter) of total revenues during the quarter.

Premier Explosives jumped 5% to Rs 48.70, after the company secured a ten-year maintenance contract from ISRO. The contract worth Rs 7 crore per year requires maintenance of a propellant plant for the premier space organisation.

JK Lakshmi Cement surged 7.90% to Rs 181.65, on posting 386% surge in net profit for December 2006 quarter, to Rs 55.06 crore. Net sales jumped 50% to Rs 228.64 crore. For April-September 2006, net profit rose 269% to Rs 117.28 crore and net sales 44% to Rs 580.59 crore.

Hindustan Construction Company dropped 2.53% to Rs 154, after it reported a 2.9% fall in net profit in December 2006 quarter to Rs 21.99 crore from Rs 22.66 crore in December 2006 quarter. Total income rose 17.4% to Rs 536.31 crore (Rs 456.60 crore). The company said the balance work on hand (till 31 December 2006) was Rs 9604 crore, which also includes a share of Rs 1940 crore in an order secured by a joint venture.

BOC India dropped 4.81% to Rs 157.25, after it reported 65.8% fall in net profit in December 2006 quarter to Rs 3.77 crore (Rs 11.04 crore). Net sales declined to Rs 115.29 crore (Rs 163.31 crore). The company said performance in Q3 December 2006, was affected due to a shutdown of a plant at Jamshedpur for 20 days during the quarter due to technical reason. The company continues to monitor its condition and will opt for planned shutdowns to rectify the situation in the future.

PSU telecom major, MTNL, jumped 5% to Rs 169.85 after media reports that the public sector telecom firm is talking to builders for developing commercial properties on large tracts of land it owns in prime locations across Mumbai, Delhi and the National Capital Region (NCR). The stock rose on a heavy volume of 41.3 lakh shares.

Titan Industries gained 4.8% to Rs 935.95, following reports that it had set a turnover target of Rs 1,250 crore for the current fiscal on the back of robust sales of its jewellery brands "Tanishq" and "Gold Plus". Last year, both brands together accounted for a turnover of Rs 780 crore. The company today opened its fourth Gold Plus showroom in Tamil Nadu, the sixth in the country. Titan proposes to open 20 Gold Plus showrooms across the country with special focus on Andhra Pradesh, Maharashtra and Karnataka in the next financial year.

As regards Tanishq, four showrooms, including one in Bangalore, will be opened before March 2007. Titan's board will meet on 25 January 2007, to consider a restructuring plan for its associate companies. Titan announces December 2006 quarter results on the same day.

Shringar Cinemas jumped 8% to Rs 63.05, on posting turnaround results in December 2006 quarter. Shringar Cinemas posted a net profit of Rs 3.64 crore in December 2006 quarter compared to a net loss of Rs 1.99 crore in December 2005 quarter. Total revenue rose 101.3% to Rs 15.42 crore (Rs 7.66 crore).

The inflation rate rose to a two-year high at the start of 2007, raising speculation of an interest rate increase, when the central bank reviews monetary policy at the end of January.

The wholesale price index rose 6.12% in the 12 months to 6 January, higher than previous week's annual rise of 5.58% due to costlier food and energy. It was the highest inflation rate since 25 December 2004.

The Nikkei share average lost 0.35% on Friday, as chip gear makers such as Nikon Corp fell on concerns about earnings' outlooks and investors grabbed profits in drug shares including Eisai Co. The Bank of Japan (BoJ) left interest rates unchanged, helping shares of consumer loan firms such as Aiful Corp. Property stocks, often burdened by heavy borrowing, also rose.

The benchmark Nikkei average was down 60.49 points, to 17,310.44. On the other hand, Hong Kong’s Hang Seng index was up 50.21 points (0.25%) for the day, at 20,327.72.

FIIs resumed buying after their recent heavy sales, which had caused a steep market fall recently. FIIs were net buyers to the tune of Rs 91.20 crore on Wednesday (17 January 2007). They were net buyers in four out of five trading sessions, from 11 January to 17 January.

As per provisional data, FIIs were net buyers to the tune of Rs 155 crore on Thursday (18 January). FIIs were net buyers of Rs 678 crore in index-based futures on 18 January. They were net buyers to the tune of Rs 111 crore in individual stock futures that day.

US stock indices ended lower on Thursday, after a conservative forecast from Apple sparked worries about the health of the technology sector. The Dow Jones industrial average ended the day down 9.22 points, or 0.07%, at 12,567.93. The Standard & Poor's 500 Index fell 4.25 points, or 0.30%, to finish at 1,426.37, while the Nasdaq Composite Index dropped 36.21 points, or 1.46%, to close at 2,443.21.

US crude oil futures for February delivery touched $49.90 a barrel, the lowest since May 2005, and settled down $1.76 at $50.48 a barrel on the New York Mercantile Exchange. The price of NYMEX crude oil has tumbled 36% from a record peak of $78.40 struck last July.