India Equity Analysis, Reports, Recommendations, Stock Tips and more!
Search Now
Recommendations
Tuesday, April 29, 2008
Sensex scales two-month high as market shrugs off monetary tightening by RBI
The market which had declined yesterday ahead of the Reserve Bank of India's annual monetary policy review, bounced back today after the central bank kept interest rates unchanged. Rate sensitive banking, auto and realty stocks surged. IT stocks surged after the Finance Minister extended tax exemption for the IT sector by a year. Metal stocks rose. The market breadth was strong.
The central bank raised the cash reserve ratio (CRR) by 25 basis points and the stance of its monetary policy was hawkish. The market had witnessed a bout of volatility earlier in the day ahead of monetary policy announcement.
Asian markets which opened before Indian market were mixed. European markets which opened after Indian markets were mixed.
The 30-share BSE Sensex jumped 362.50 points or 2.13% at 17,378.46. Sensex hit a high of 17,424.94 in late trade, its highest level in two months. At the day’s high, Sensex rose 408.98 points. Sensex hit a low of 17011.60 in mid-morning trade. At day's low Sensex fell 4.36 points.
The broader based S&P CNX Nifty was up 105.85 points or 2.08% at 5,195.50
From a recent low of 16698.04 on 23 April 2008, Sensex has gained 680.42 points or 4.07% to 17378.46 on 29 April 2008. From a low of 14809.49 on 17 March 2008, Sensex has risen 2568.97 points or 17.34%. The barometer index is off 3828.31 points or 18.05% from a all time high of 21206.77 struck on 10 January 2008.
The turnover on BSE stood at Rs 7262 crore as compared to a turnover of Rs 5544.33 crore on Monday, 28 April 2008. Turnover in NSE's futures & options (F&O) segment spurted to Rs 41,819.49 crore, as compared to Rs 25,459.22 crore on Monday, 28 April 2008.
Nifty May 2008 futures were at 5217.40, a premium of 21.90 points as compared to spot closing of 5,195.50.
The CRR is the percentage of banks' deposits which they must keep as cash with the central bank. It may be recalled that RBI had earlier this month announced a two-stage rise in CRR to 8%.
The Reserve Bank of India (RBI) said managing liquidity would continue to receive priority in its policy objectives and warned it would act swiftly to curb any signs of adverse developments in inflation expectations.
RBI has forecast economic growth of 8% to 8.5% in the fiscal year that began this month, after an estimated 8.7% growth in 2007/08. RBI said it aims for inflation of around 5.5% this fiscal year with the goal of lowering it close to 5% as soon as possible.
The market breadth was strong on BSE with 1588 shares advancing as compared to 1121 that declined. 61 remained unchanged.
The BSE Mid-Cap index rose 1.13% to 7146.95 and BSE Small-Cap index rose 0.87% to 8,785.31.
BSE Realty index (up 5.9% to 8,650.24), BSE Metal index (up 3.64% to 16192.97), BSE IT index (up 5.24% to 4237.81), BSE Consumer Durables index (up 2.81% to 4585.97), outperformed Sensex.
BSE Oil & Gas index (up 2.02% to 11661.26), BSE Bankex (up 1.68% to 8,964.75), BSE PSU index (up 1.65% to 8008.99), BSE Auto index (up 1.52% to 4,646.62), BSE Capital Goods index (up 1.28% to 13931.17), BSE HealthCare index (up 0.78% to 4,248.62), BSE Power index (up 0.96% to 3,336.34) and BSE FMCG index (up 0.52% to 2,412.61) underperformed Sensex
As per the provisional figures, foreign institutional investors (FII)s bought shares worth Rs 232.18 crore today 29 April 2008 and domestic funds bought shares worth Rs 403.27 crore.
Realty stocks surged in late trade. Indiabulls Real Estate (up 3.06% to Rs 557.35), DLF (up 8.57% to Rs 725.85) and Unitech (up 8.18% to Rs 317.50) rose.
IT stocks surged. Satyam Computer Services (up 8.22% to Rs 479.35), Infosys (up 5.15% to Rs 1,750.75), Wipro (up 4.7% to Rs 479.20) and Tata Consultancy Services (up 3.15% to Rs 910.80) edged higher.
Finance Minister Palaniappan Chidambaram extended by a year a tax holiday scheme for export-driven software companies as he outlined some changes to the federal budget for 2008-09. The scheme for facilities based in technology parks was set to expire in March 2009.
Metal stocks rose. Tata Steel (up 4.01% to Rs 808.90), National Aluminium Company (up 4.37% to Rs 458.70), Hindalco Industries (up 6.44% to Rs 198.20), Steel Authority of India (up 2.08% to Rs 179.40), Sterlite Industries (up 4.77% to Rs 898.85) edged higher.
Finance Minister P Chidambaram today said government will impose export tax on basmati rice and some steel products, and cut import duties on key inputs like ferro alloys and metallurgical coke. He said the measures were being taken to improve domestic supplies and to moderate prices.
Banking stocks surged after the RBI's policy announcement. State Bank of India (up 3.27% to Rs 1,793.50), HDFC Bank (up 1.95% to Rs 1,547.50) and ICICI Bank (up 0.71% to Rs 901.30) edged higher.
Auto Stocks edged higher. Mahindra & Mahindra (up 1.17% to Rs 642.70), Tata Motors (up 1% to Rs 639.95) Maruti Suzuki India (up 1.24% to Rs 731.30), Hero Honda Motors (up 5.34% to Rs 861.85), rose.
HDFC (up 5.95% to Rs 2881.45), Larsen & Toubro (up 2.09% to Rs 3007.40) Jaiprakash Associates (up 5.95% to Rs 266.10), Ambuja Cements (up 1.32% to Rs 114.85), Bharat Heavy Electricals (up 1.29% to Rs 1891.85), Reliance Industries (up 2.35% to Rs 2,653) edged higher from Sensex pack.
Hindustan Unilever rose 1.48% to Rs 250.85. Net profit of Hindustan Unilever declined 3.04% to Rs 380.95 crore on 19.14% rise in sales to Rs 3793.94 crore in Q1 March 2008 Q1 March 2007. The board of the company has approved the change in the financial year to April-March.
Reliance Communications declined 1.73% to Rs 574.70 while Bharti Airtel fell 2.67% to Rs 904.50. Reliance Communications said on Monday, 28 April 2008, it would offer unlimited national long distance calls within its network for a fixed rental with immediate effect. Earlier yesterday, sector leader Bharti Airtel slashed long distance and roaming tariffs by 43% effective 30 April 2008.
Reliance Natural Resources clocked the highest volume of 2.15 crore shares on BSE. Ispat Industries (1.71 crore shares), IFCI (1.56 crore shares), Indiabulls Securities (1.51 crore shares) and Reliance Petroleum (1.47 crore shares) were the other volume toppers in that order.
Reliance Capital clocked the highest turnover of Rs 317.11 crore on BSE. Sesa Goa (Rs 309.43 crore), Reliance Petroleum (Rs 295.31 crore), Reliance Natural Resources (Rs 270.24 crore) and Reliance Industries (Rs 231.64 crore) were the other turnover toppers in that order.
It its latest report on macroeconomic and monetary developments in 2007/08 released on Monday, 28 April 2008, RBI has said that the global food prices were likely to remain firm as supply side pressures did not appear to be abating. The central bank said steps takes by the government to rein in prices should help curb inflation. It, however, said the inflation risks on account of oil prices remain incipient.
RBI has noted that freely priced fuel items such as naphtha had increased substantially since February 2007 alongside rising global oil prices, while prices of petrol and diesel, which are government-controlled, had partially adjusted. But prices of kerosene and cooking gas had not been raised by the government for several years.
RBI felt there were some demand-side pressures. Domestic iron and steel prices saw a sharp increase in line with recent hardening in international steel prices, it said, while cement price rises could be attributed largely to strong demand from construction domestically. A survey of professional forecasters by the central bank showed that the Indian economy is expected to grow 8.1% in the 2008/09 fiscal year that began this month. In 2007/08, the gross domestic product is estimated to have grown 8.7%.
A cause for concern is the fall in business confidence index. A survey of 392 companies by Federation of Indian Chambers of Commerce and Industry (FICCI), showed that concerns about an economic slowdown, inflation and rising costs hurt business confidence of Indian firms during October-December 2007 period. The FICCI business confidence index declined to a new five-year low of 55.3 points in the third quarter of 2007/08, from 61.2 in the previous quarter.
On the flip side, a pointer to the fact that the long term India growth story remains intact is the outcome of the latest 2008 US-India Business Council (USIBC) survey, according to which, India is, and will continue to be, a premier destination for investment by US firms, with a large number of respondents rating future economic growth in India as highly sustainable. Meanwhile, the Lok Sabha is slated to pass the Finance Bill 2008-09 today, 29 April 2008.
The two-day US Federal Reserve policy meeting ends on Wednesday, 30 April 2008. The market expects the Fed to cut interest rates by 25 basis points to 2% and then signal that its rate-cutting cycle may be over for now in the face of mounting global energy and food inflation pressure.
US stocks ended flat on Monday, 28 April 2008, as a $23 billion takeover of Wm Wrigley Jr Co, the world's largest chewing gum maker, by Mars Inc, the maker of M&Ms candy, helped offset downbeat comments by influential investor Warren Buffett about the economy. Buffett said US could be mired in a longer and deeper recession than most people think.
Asian stocks were mixed today. Key benchmark indices in Hong Kong and China were up by between 1.05% to 1.4%. Key benchmark indices in Singapore, Taiwan and South Korea were down by between 0.64% to 2.07%. Japanese markets were closed for a national holiday.
European markets were mixed. France’s CAC 40 and Germany’s DAX and were down between 0.35%-0.56% while UK’s FTSE 100 rose 0.4%.
Market ends firm on IT-led surge
The market posted significant gains with buying, particularly, in IT and realty stocks, followed by decent gains in metal and other select counters jacking up the sentiment. However, the market witnessed sharp volatility within minutes of the commencement of the trading session. After resuming 35 points above its previous close of 17,051, the Sensex moved down 4 points and touched the day's low of 17,011. The index soon rebounded into positive territory on smart gains and rose sharply to an intra-day high of 17,425 in noon trades. While it moved in a range with a positive bias thereafter, the Sensex ended the session with gains of 363 points at 17,378. The Nifty moved up by 106 points to close at 5,196.
The market breadth was firm. Of the 2,770 stocks traded on the BSE, 1,586 stocks advanced, 1,121 stocks declined and 63 stocks ended unchanged. Among the sectoral indices, all the indices closed in positive territory. BSE Realty index rose 5.90%, the BSE IT index advanced 5.24% and the BSE Metal was up 3.64%. The BSE CD index, however, tumbled 2.31%, while the BSE CD, Teck and Oil & Gas index gained over 2% each. All the remaining indices gained ended with marginal gains.
IT pivotals among the index stocks led the upsurge. Tech Mahindra soared 10.51% at Rs902. While Satyam advanced 8.22% at Rs479.35, HCL Techno at Rs286.40, NIIT Technology moved up 7.27% at Rs137.95 and Infosys gained 5.15% at Rs1,750.75. Among the other movers of the IT Index, Mphasis added 4.97% at Rs237.55, Wipro scaled up 4.70% at Rs479.20, Patni Computer moved up by 4.70% at Rs479.20, Aptech rose 4.37% at Rs260.10, TCS climbed 3.15% at Rs910.80 and NIIT was up nearly 2.09% at Rs102.40.
Action was also seen in Sensex stocks. DLF flared up 8.57% at Rs725.85, Hindalco jumped by 6.44% at Rs198.20 and HDFC rose 5.95% at Rs2,881.45. Jaiprakash Associates at Rs266.10, Tata Steel at Rs808.90, SBI at Rs1,793, RIL at Rs2,653 and L&T at Rs3,007 gained 2-5% each.
Over 2.15 crore Reliance Natural Resources Ltd shares changed hands on the BSE followed by ISPAT Industries (1.71 crore shares), IFCI (1.56 crore shares), IB Securities (1.51 crore shares) and RPL (1.47 crore shares).
Reliance Capital clocked a turnover of Rs317 crore followed by Sesa Goa (Rs309 crore), Reliance Petroleum (Rs295 crore), Reliance Natural Resources Ltd (Rs270 crore) and RIL (Rs231 crore).
Post Market Commentary - Apr 29 2008
The Indian Market made a smart turnaround soon after the announcement of the monetary policy by the RBI in which it kept all the key interest rates unchanged but it raised the Cash Reserve Ratio by 25 basis point As per this, the scheduled banks required to maintain CRR of 8.25% with effect from the fortnight beginning May 24, 2008. But earlier there are rumors of hike in repo rate and revere repo rate but RBI beat all the expectations by keeping these rates unchanged. This led to the boosting of the sentiments among the investors and heavy buying was witnessed from the realty, metal and bakex indices baskets. In this review, RBI expects the economy to grew by 8-8.5% in 2008-09 also inflation remained a serious concern and as per RBI it would be brought down to around 5.5% in 2008-09 and the preference would be to bring it close to 5%. Though the market opened on a firm note but pared all its gains before the announcement of the policy but gained he momentum soon after the declaration of monetary policy review. The market breadth was strong as 1588 stocks closed in green while 1121 stocks closed in red.
The BSE Sensex closed higher by 362.50 points at 17,378.46 and NSE Nifty closed up by 105.85 points to close at 5,195.50. The BSE Mid Caps closed up by 79.55 points at 7,146.95 and Small Cap grew by 75.49 points to close at 8,785.31.
Major losers from the BSE are Grasim inds (6.16%), Welspun Guj (5.17%), India Infoline (4.01%), Idea Cellular (3.67%), Spice Tele (3.58%), United SPR (3.33%), Akruti City (3.12%), Bharti Airtel (2.79%).
Major gainers from the BSE are Bombay Dyeing (13.27%), Sesa Goa (12.56%), Tech Mahindra (10.51%), Titan inds (9.41%), DLF (8.57%), Satyam Comp (8.22%), Unitech (8.18%).
The Realty index increased drastically by 482.17 points to close at 8,650.24. Scrips that jumped are DLF (8.57%), Unitech (8.18%), HDIL (6.61%), Ansal Infra (5.72%), Parsvanath (3.60%), Omaxe (3.06%), Penland (2.86%), Mahindra Life (2.77%) and Sobha Dev (3.45%).
The Metal index surged 568.75 points to close at 16,192.97. Major gainers are Sesa Goa (12.56%), Hindalco inds (6.44%), Sterlite inds (4.77%), Nalco (4.37%), Tata Steel (4.01%), Bhushan Steel (2.72%), Ispat inds (2.64%) and Jindal Steel (2.31%).
The Capital Goods index closed up by 176.13 points at 13,931.17. Scrips that gained are Havells India (4.89%), Punj Lloyd (3.87%), Bharat Elec (3.27%), Suzlon Energy (2.93%), L&T (2.09%), Praj inds (1.61%) and BHEL (1.29%).
The Bankex index grew by 147.91 points to close at 8,964.75. Gainers are SBI (3.27%), Axis bank (2.74%), Oriental bank (2.65%), Canara bank (2.41%), Federal bank (2.38%), PNB (2.04%), Yes bank (1.91%) and Union bank (1.33%).
The Oil & Gas index closed higher by 231.24 points at 11,661.26. Scrips that grew are RPL (4.28%), Essar Oil (3.11%), RNRL (2.59%), Reliance inds (2.35%), BPCL (1.36%), IOCL (0.76%).
Pre Session Commentary - Apr 29 2008
The Indian Market is likely to have a positive opening due to mixed cues from the global markets. On Monday, the Indian market closed in red as the volatility gripped the market since the initial bell. The market was unable to sustain at higher levels and kept on moving between the positive and negative territory throughout the trading session. Also, the RBI’s monetary policy review and US Fed’s policy meeting on April 30 led the investors to take cautious approach through out the trading session. The market breadth was weak as 1374 stocks closed in red while 1295 stocks closed in green. The BSE Sensex closed lower by 110.02 points at 17,015.96 and NSE Nifty fell by 22.05 points to close at 5,089.65. We expect that the market may remain choppy during the trading session and all the eyes will be on the RBI’s Credit Policy, which is scheduled today and this announcement by RBI will give further direction to the market.
On Monday, the US market closed mixed. The Dow Jones Industrial Average (DJIA) closed lower by 20.11 points at 12,871.75 along with S&P 500 fell by 1.47 points to close at 1,396.37 while NASDAQ closed higher by 1.47 points at 2,424.40.
The Indian ADRS closed mixed. In technology sector, Infosys fell by (1.92%) along with Satyam by (1.06%) and Wipro by (0.63%). In banking sector, ICICI bank and HDFC Bank dropped by (3.86%) and (2.86%) respectively. In telecommunication sector, Tata Communication and MTNL increased by (0.40%) and (0.36%) respectively.
Today the major stock markets in Asia are trading mixed. Hang Seng is trading higher by 75.05 points at 25,738.34 along with Japan’s Nikkei trading up by 30.90 points at 13,894.37 and Taiwan Weighted trading at 9,057.34 up by 18.05 points.
The FIIs on Monday stood as net buyer in equity while net seller in debt. The gross equity purchased was Rs3,414.90 Crore and the gross debt purchased was (Rs186.90 Crore) while the gross equity sold stood at Rs3,066.10 Crore and gross debt sold stood at Rs236.30 Crore. Therefore, the net investment of equity reported was Rs348.80 Crore and net debt was (Rs423.20 Crore).
Today, Nifty has support at 4,867 and resistance at 5,198 and BSE Sensex has support at 16,642 and resistance at 17,482.
Trading Calls - Apr 29 2008
Nifty (5090) Sup 5040 Res 5150
Buy REL (1424) SL 1400
Target 1455, 1465
Buy RPL (194) SL 190
Target 200, 202
Buy Titan (1190) SL 1175
Target 1220, 1230
Sell Tech M (814) SL 822
Target 798, 794
Sell NIIT Tech (129) SL 134
Target 121, 119
Reddy to wait?
“If you wait to do everything until you're sure it's right, you'll probably never do much of anything.”
Will he, won’t he? The market is still divided over what action the RBI will take in today's annual policy meeting. A hike could well provide the bears a fresh opportunity to nail the bulls. On the other hand, a status quo (waiting for the Fed to act first) will perk up the mood on the street. The key indices lost ground yesterday as investors developed cold feet amid fears that the RBI may hike the repo rate by 25 bps to contain inflation. As a result, the Nifty failed to cross the 200 DMA of 5150 yesterday.
Meanwhile, a survey of professionals done by the RBI shows that the Indian economy will grow at a healthy 8.1% in FY09. If indeed GDP grows at 8% in the current fiscal it would not be a bad feat at all given the slew of headwinds that we are facing right now. The survey also reveals that corporate profits will clock a 25% growth in FY09, which again would be quite commendable. The central bank also believes that inflation will moderate in the second half, though high crude oil prices will continue to pose a risk.
The market appears to have factored in most bad news, both local as well as global. As a result, the bulls may remain in command in the near term, especially if global markets too hold their nerve. Some more grim developments lurking somewhere could spark renewed sell-off. For today, we expect a cautious start and a lackluster trading till noon, when the RBI will announce its monetary policy for the year 2008-09. Select stock centric action will continue based on the results and other company specific announcements.
Key Results Today: Aban Offshore, Alstom Projects, Atlas Copco, Aurionpro Solutions, Bhushan Steel, Cadila Healthcare, Cairn India, Castrol India, CEAT, Esab India, Gateway Distriparks, Gayatri Projects, Grasim, Hanung Toys, IFCI, ING Vysya Bank, JK Tyre, Jyothy Labs, Maharashtra Seamless, Mirc Electronics, Nagarjuna Fertilizers, NALCO, Nestle, Patni, Pioneer Embroideries, Raymond, Reliance Capital, Subex, Taj GVK Hotels, Tata Sponge, UTV, Venus Remedies, Viceroy Hotels and Vishal Retail.
FIIs were net sellers of Rs383.3mn (provisional) in the cash segment yesterday while local institutions were net sellers of Rs1.67bn. In the F&O segment, foreign funds were net buyers of Rs4.55bn. On Friday, FIIs were net buyers of Rs3.49bn in the cash segment while Mutual Funds were net sellers of Rs734mn.
Asian markets were trading mixed this morning. The Hang Seng in Hong Kong was up 289 points or 1.1% at 25,955 while the Kospi in Seoul was down 6 points or 0.3% at 1817. The Straits Times in Singapore dropped 26 points or 0.8% at 3175 while the Shanghai Composite in China rose 46 points or 1.3% to 3521 and the Taiex in Taiwan was down 50 points or 0.6% at 9029.
Benchmarks elsewhere in Asia fell barring Malaysia, the Philippines and China. Japan's markets are closed for a public holiday.
US stocks closed almost unchanged on Monday as investors turned cautious ahead of Wednesday's Fed policy announcement. Stocks had risen earlier after billionaire Warren Buffett financed the $23bn takeover of Wm. Wrigley Jr. Co. and investor Kirk Kerkorian bought a stake in Ford Motor.
Wrigley, the world's biggest maker of chewing gum, jumped the most since at least 1980 after Mars agreed to acquire the company at a 28% premium to its closing price last week. Ford shares rallied after Kerkorian said he bought 4.7% of the second-largest US automaker and plans to buy more.
Microsoft shares slumped for a second day, helping drag the S &P 500 Index and Dow Jones Industrial Average lower, on speculation that the world's largest software company will have to increase its bid to acquire Yahoo.
The S&P 500 ended virtually flat at 1,396.37. The Dow dropped 20 points, or 0.2%, to 12,871.75. The Nasdaq Composite Index finished barely changed at 2,424.4. The Russell 2000 Index, an index of small-cap companies, gained 0.5% for its fourth consecutive advance.
Market breadth was positive. About five stocks gained for every four that fell on the New York Stock Exchange.
Stock gains were limited and tapered off by the close, as investors geared up for the two-day FOMC meeting starting Tuesday. The Fed is expected to cut interest rates again, and then perhaps signal that it is done for the time being.
US light crude oil for June delivery rose 23 cents to settle at $118.75 a barrel in New York after hitting a record $119.93 earlier in electronic trading. Meanwhile, the national average price for a gallon of regular unleaded gas hit an all-time record of $3.603, AAA reported.
COMEX gold for June delivery rose $5.80 to settle at $895.50 an ounce. The dollar gained versus the euro and yen. Treasury prices advanced, lowering the yield on the benchmark 10-year note to 3.82% from 3.87% late on Friday.
Candy maker Mars is buying gum maker Wrigley in an all-cash deal worth nearly $23bn. The deal will eventually make Wrigley a subsidiary of Mars. Warren Buffett's Berkshire Hathaway is making a minority equity investment in the new subsidiary. Wrigley shares surged 23%.
Kirk Kerkorian's Tracinda Corp. is offering $170mn to buy an additional 20mn shares of Ford. Tracinda already owns 100mn Ford shares. Shares of the US auto giant jumped 9.5%.
Continental said it wasn't interested in entering into a merger agreement with another company right now, surprising United Airlines' parent UAL, which had been in advanced talks with the carrier. However, reports say Continental has been in talks with American Airlines' parent AMR about an arrangement that would involve an alliance but not a merger.
Verizon Communications reported higher quarterly earnings that met analysts' estimates on higher revenue that was short of expectations. Shares gained 2.5%. RadioShack reported lower quarterly earnings and sales that nonetheless topped forecasts. Shares slumped 13.5%.
Across the Atlantic, banks helped European shares gain ground for the fourth session in a row. Oil companies and miners also performed well. The pan-European Dow Jones Stoxx 600 index rose 0.6% to 323.62, building on strong gains made on Friday when the index recaptured levels last seen in February.
Germany's DAX 30 rose 0.4% to 6,925.33 and the French CAC-40 advanced 0.7% to 5,012.75, while a poor performance from supermarket chains led the UK's FTSE 100 to close nearly unchanged at 6,090.40.
In the emerging markets, the Bovespa in Brazil gained 0.75% to 65,677 while the IPC index in Mexico was down 1.2% at 30,623. The RTS index in Russia rose 1% to 2150 while the ISE National 30 in Turkey finished flat at 54,167.
All eyes on RBI
In a lackluster trading session, both the key indices struggled to find any direction resulting into sideways movement. Profit booking was witnessed key index heavyweights like RIL, ICICI Bank and Tata Steel. Also, some consolidation was seen in today’s trade after recording around 4% returns last week. Even, the volumes dried up ahead of the outcome of RBI’s monetary policy meet on Tuesday.
As large-caps were seen consolidating, momentum continued in select-side counters with sugar and fertilizers stocks among the major gainers. Oil & gas, IT and banking stocks were among the major laggards dragging the benchmark Sensex down by 110 points at 17,016 and Nifty lower by 22 points at 5,090.
ICICI Bank dropped by over 2% to Rs894. Reports said that the company made additional provisions of US$45mn for mark to market losses on its credit derivative obligations and credit-linked note portfolio in February and March 2008. The scrip touched an intra-day high of Rs947 and a low of Rs890 and recorded volumes of over 14, 50, 000 shares on BSE.
Reliance Industries was down by over 1% to Rs2,592. Reports said that the Government approved an oil and gas development plan of the company in its D6 block off the east coast. The scrip touched an intra-day high of Rs2,650 and a low of Rs2,583 and recorded volumes of over 6, 00, 000 shares on BSE.
ONGC reduced by over 0.5% to Rs1,047 following reports stating that the company is expecting to seal the deal for a stake in the South pars block during next week visits of Iranian president. The scrip touched an intra-day high of Rs1,064 and a low of Rs1,041 and recorded volumes of over 2, 00, 000 shares on BSE.
Essar Oil fell by over 3% to Rs271. Essar E&P, a subsidiary of the company, bid for two shallow water offshore blocks in Australia, said reports. The scrip touched an intra-day high of Rs283 and a low of Rs267 and recorded volumes of over 26, 50, 000 shares on BSE.
Siemens took a huge fall by 10% to Rs580 after the company announced a decline in net profit by 98.5%. The scrip touched an intra-day high of Rs620 and a low of Rs542 and recorded volumes of over 23, 50, 000 shares on NSE.
KPIT Cummins fell sharply by 11.5% to Rs94 after the company announced its Q4 results with MTM loss of Rs89cr as on 31st March. The scrip touched an intra-day high of Rs107 and a low of Rs89 and recorded volumes of over 14, 50, 000 shares on NSE.
Biocon was down by 0.5% to Rs483. The company has plans to set up its own R&D subsidiary arm in the current fiscal, according to reports. The scrip touched an intra-day high of Rs494 and a low of Rs480 and recorded volumes of over 1, 00, 000 shares on NSE.
Cairn India was up by 1% to Rs258 after the company announced that it managed to extract 200mn barrels of oil from Andhra reserves which were estimated at 101mn barrels. The scrip touched an intra-day high of Rs263 and a low of Rs256 and recorded volumes of over 19, 50, 000 shares on NSE.
Last week’s intermediate uptrend was halted due to profit taking ahead of the RBI’s policy meet on Tuesday. FIIs have largely been in the sidelines, which is a cause of concern. Globally, we may well have a 25 bps rate hike from the Federal Reserve, on April 30. But, our market will only be able to react to the Fed decision and to whatever comments it makes on May 2, as the markets will be shut on Thursday on account of Maharashtra Day.
Corporate News
GAIL would be a part of the consortium building the US$7.6bn Turkmenistan-Afghanistan-Pakistan-India gas pipeline by 2015. (BL)
TCS has bagged Rs4.5bn contract from Scottish Water, a UK based utility firm. (BS)
Bharti Airtel has cut STD tariffs to a flat Rs1.5/minute from up to Rs2.65/minute and roaming charges by 43% for incoming calls. (ET)
RCom plans to offer free unlimited national long-distance calls for a monthly rent of Rs440 for post-paid and Rs496 for pre-paid customers. (Mint)
IOC is seeking board approval for doubling of its borrowing limit to create a war chest of Rs800bn to fund a major acquisition in E&P sector. (FE)
Tata Steel is joining hands with MMTC for acquiring mining assets abroad through a special purpose vehicle (SPV). (ET)
M&M enters spares, used-car markets, plans to invest ~Rs2.5bn in this segment. (ET)
Dishman Pharma may divest stake in its pharmaceutical SEZ to private equity funds or list it on the bourses in 2009-10. (Mint)
Tata Motors is planning a new platform for a compact car code-named X4. (DNA)
US Patent and Trademark Office has rejected Pfizer’s request for reissue of patent in Lipitor case against Ranbaxy. (BS)
IVR Prime Urban Developers is planning to invest Rs6.86bn in two projects in South India. (BS)
Mindtree Consulting and Satyam Computers have bagged a three year contract from Arcelor Mittal. (BS)
M&M is planning to pursue private placement route for raising funds for its inorganic growth plans. (BS)
KPIT Cummins has reported Rs900mn MTM losses in forex derivatives transactions. (BS)
Sun Network and Zee Entertainment have dethroned Star group as the leading Asia Pacific pay broadcaster. (BS)
Hinduja Group and ONGC Videsh have won approval of Iranian authorities to conduct due diligence for taking stakes in one of the largest oil and gas fields in the Persian Gulf nation. (BL)
BHEL-NTPC joint venture is planning to enter equipment manufacturing business. (BL)
Lanco Infratech has said that there were no inconsistencies in its successful bid for Sasan UMPP. (FE)
Economic News
RBI has said that performance of the manufacturing sector is expected to be lower in Q1 FY09 compared to Q1 FY08. (BS)
RBI has exempted joint ventures and overseas subsidiaries of banks from an investment limit on affiliates. (BS)
RBI has allowed banks and brokers as the first participants to start currency futures on existing exchanges. (BS)
Almost 32,000 petrol pump dealers have threatened to go on a strike from May 17, 2008 if the commission they get on fuel sales is not increased. (BS)
Government is considering imposing a 15% export duty on export of steel products. (BS)
ICAI Accounting Standard’s board has cleared the proposed accounting standard on disclosure of financial instruments (AS-32). (BL)
The group of ministers examining finances of the power sector has proposed that the government divest up to 49% in profitable central power sector companies that include NTPC, PFC, REC, PGCIL and NHPC. (FE)
The total production capacity of the Indian cement industry has gone up to 190mn tons for FY08 as compared to 167mn tons in FY07. (FE)
The Government plans to penalize drug makers who pay wholesalers and chemists over and above the fair margin notified by it. (ET)
The Government has decided not to revive the four state-owned vaccine units whose licences were recently suspended. (ET)
Flowers will be eligible for an additional duty credit equivalent to 2.5% of FOB value of exports over and above the credit available under Vishesh Krishi and Gram Udyog Yojana. (ET)
Reliance Communications GSM coming soon
Reliance Communication today said it would launch GSM based nation-wide mobile services by the end of current financial year, to become the only operator offering mobile services on both GSM and CDMA platforms.
"We are aiming to set up nationwide GSM and CDMA network by fiscal end which will cover 23,000 towns and six lakh villages serving 97 per cent of the Indian population," Reliance Communications President S P Shukla said.
The company has been given start up GSM spectrum (radio frequency) to offer wireless services under the dual technology and also CDMA spectrum in the remaining two circles of North East and Assam.
With the focus to enhance the momentum of teledensity growth in rural India, the company has also launched a affordable mobile offering — Gaon Chalo for rural areas.
Reliance Communications would roll out mobile network in another 8,000 towns and 20 million villages over the next six months.
"After bringing down cost of calls, validity and devices in urban India which triggered unprecedented market growth, we will now do the same for the rural population," he said.
The new offer would enable a rural customer to go mobile at Rs 49 which is a 50 per cent discount over the cost to go mobile in the urban areas.
Under the ‘Gaon Chalo' scheme, customers have the option of buying a new pre-paid SIM card with lifetime validity for Rs 249.
Moreover, customers can choose any validity, talk time or tariff proposition on this card.
The company also eyes 50 per cent future growth from semi-urban and rural markets, he added.
Today's Pick - Cipla
Natural gas advances 51% this year
Natural gas advanced to a 28-month high as crude oil surged to a record after supplies were crimped by closure of a pipeline and a workers' strike. Gas for May delivery rose 31.7 cents (2.9%) to settle at $11.28 per million British thermal units. Gas has advanced 51% this year.
Against this backdrop, June reformulated gasoline fell 2.3 cents to $3.0307 a gallon and June heating oil was almost flat at $3.2988 a gallon.
Crude-oil prices were also rising on rebel attacks on oil installations in Nigeria. Five policemen were killed on last Sunday when rebel groups attacked the nation's largest oil and gas terminal. The development came amid renewed supply concerns last week after a rebel group attacked a pipeline late Thursday in Nigeria's southern Rivers State.
Crude had ended FY 2007 substantially higher by $35 or 57%. It was crude’s biggest yearly gain in five years.
At the MCX, crude oil for May delivery closed at Rs 4,758/barrel, higher by Rs 10 (0.2%) against previous day’s close. Natural gas for July delivery closed at Rs 453/mmbtu, higher by Rs 5.3/mmbtu (1.2%).
REL, RIL May 2008 futures at premium
Turnover in F&O segment declines
Nifty May 2008 futures were at 5117, at a premium of 27.35 points as compared to spot closing of 5089.65.
The NSE's futures & options (F&O) segment turnover was Rs 25,459.22 crore, which was lower than Rs 33,831.87 crore on Friday, 25 April 2008.
Reliance Energy (REL) May 2008 futures were at premium at 1438 compared to the spot closing of 1423.95.
Reliance Industries (RIL) May 2008 futures were at premium at 2595.35 compared to the spot closing of 2591.40.
Reliance Natural Resources May 2008 futures were near spot price at 123 compared to the spot closing of 123.55.
In the cash market, the S&P CNX Nifty lost 22.05 points or 0.43% at 5089.65.
Subscribe to:
Posts (Atom)