Market Close: Expiry nearing.. Looking for Direction..

Subdued session in the market as indices looked for direction. Asian cues were negative and even Europe traded in red. Selling pressure was seen from the start which pushed the market into red zone. This week is the FNO expiry which added to the sluggish session. Selective buying was seen in sector like Telecom, Cement, Oil and Capital good while IT stocks declined on lack of fresh buying. Midcap index opened firm but slipped later to end flat inline with the benchmark indices. Smallcap index closed in green outperforming the frontline indices. Midcaps like GreenPly, Esab India rallied with good.

Sensex ended up by 20 points at 14487.72. It is helped up by gains in L & T (2166.05,+3 percent), RCVL (522.5,+2 percent), HDFC (1904.25,+1 percent), Bharti Tele (833.25,+1 percent) and ONGC (916.6,+1 percent). Restricting the gains are Cipla (206,-2 percent), Bajaj Auto (2137.8999,-2 percent), Satyam (454.75,-2 percent), HLL (188.8,-1 percent) and Grasim (2460.6499,-1 percent).

Greenply continued to perform well after the fantastic results reported. Top line grew by 76% to Rs.111 cr. Margins at operating level improved by 260 bps compared to same period last year. EBITDA enhanced by 126% to Rs.13 cr for the quarter. On sequential basis margins was down as company incurred revenue expenditure of Rs.80 lac on implemented SAP and also incurred higher advertising spend. Profits grew by 78% to Rs.6.7crs. Uttaranchal plant went on line during 2006-07. It is expected to go on full steam in FY2008. It enjoys excise and tax holiday and benefits have started flowing to the bottom line. For the full year Revenue was Rs.403 cr. EBITDA @ Rs.46 cr. EBITDA margin was11.5 %. PAT stood at 22.6crs up over 60%. The consolidated numbers contain the numbers of the 100 % subsidiary based out of Europe which is for marketing. Valuations are attractive and we remain positive on this story. We have a detailed research note on this which will give clear picture on the story.

State-run Oil and Natural Gas Corporation reported it financial results which was in line with the industry expectation. Its net profit for fiscal 2006-07 jumped 8% to Rs 15643 crore despite a subsidy payout of Rs17024 crore during the year. The company had posted a net profit of Rs14431 crore in the 2005-06 fiscal. Turnover in FY?07 increased by 18% to Rs 56904 crore and the company declared a dividend of 310% to its shareholders. ONGC?s gross realization in crude sales was $66 a barrel but company had to shell out a discount of $22 to refiners toward subsidized fuel sales. The net realisation for ONGC in 2006-07 was $44 dollar a barrel. The management has said the that the group will invest Rs 121,318 crore in 11th Plan period (2007-012) compared to Rs75,380 crore in the previous plan period. Crude pricers at over 65$ could create some level of margin pressure. Stock managed to close up marginally.

Technically Speaking: It was a volatile session as the indices oscillated to either side of the region ended flat. Sensex touched intraday high of 14521 levels and low of 14424 levels. As we are approaching the expiry, the market is getting more and more ranged. On the lower side Nifty futures has a support at 4215 which was not broken for last 3 days and on the higher side it is facing resistance at 4265,4270 levels and Sensex resistance is seen at 14531levels while the support is seen at 14434, 14381 levels. The market is looking for a bigger move and it might come with the expiry, as it is we believe the trend is up and hence the bigger move is likely to come as an uptrend. Market turnover was low at Rs 4283 Cr. Overall breadth was in favor of Advances, where the Advances were 1487 against the Declines of 1116.