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Tuesday, May 27, 2008
Grey Market - Bafna, Niraj Cement, Anus Labs
Gokul Refoils 195 10 to 12
Anus Laboratories 210 32 to 35
Niraj Cement 175 to 190 12 to 15
Bafna Pharmaceutical 40 10 to 12
Nifty May 2008 futures at discount
Turnover in F&O segment rises
Nifty May 2008 futures were at 4851.90, at a discount of 7.90 points as compared to spot closing of 4859.80.
The NSE's futures & options (F&O) segment turnover was Rs 49,968.50 crore, which was higher than Rs 44,103.52 crore on Monday, 26 May 2008.
State Bank of India May 2008 futures were at discount at 1447.35 compared to the spot closing of 1474.40.
Cairn India May 2008 futures were near spot price at 299 compared to the spot closing of 298.50.
Housing Development & Infrastructure May 2008 futures were at premium at 751.50 compared to the spot closing of 741.10.
In the cash market, the S&P CNX Nifty lost 15.25 points or 0.31% at 4859.80.
Market sheds amid sharp volatility
The market recorded its fourth straight loss as players resorted to heavy selling on lack of liquidity support from foreign institutional investors, which have been offloading equities sharply in the past few sessions. Positive Asian indices also failed to lift the sentiment, as the Sensex drifted into negative territory in late morning trades after gaining 157 points in early trades to touch the day's high of 16,506. The sentiment turned extremely bearish in noon trades as sustained selling in heavyweights, Bankex, consumer durables, PSU and realty stocks dragged the index below the 16,300 mark to an intra-day low of 16,238. The Sensex, which gyrated 268 points during intra-day trades, finally ended the session with losses of 73 points at 16,276, while the Nifty dropped 15 points to close at 4,860.
The market breadth was exceedingly negative. Of the 2,763 stocks traded on the BSE 1,754 stocks declined, 930 stocks advanced and 79 stocks ended unchanged. Among the sectoral indices, BSE Bankex index dropped 2.33% at 7,755 followed by BSE CD index (down 1.90% at 4,386), BSE PSU index (down 1.72% at 7,212), BSE Realty index (down 1.55% at 7,226) and BSE Oil & Gas index (down 1.04% at 10,708) etc.
Among the laggards, SBI slumped 4.19% at Rs1,473, HDFC tumbled 2.08% at Rs2,519.75, ICICI Bank plunged 1.71% at Rs812.55, ONGC declined 1.34% at Rs884.35, Reliance Industries dipped 1.25% at Rs2,493, HDFC Bank crumbled 1.20% at Rs1,331. Satyam Computer Services however bucked the downtrend and advanced 3.29% at Rs499, while Cipla gained 3.04% at Rs205.05. Wipro and ITC ended with steady gains.
Bankex stocks continued to reel under sustained selling pressure. Oriental Bank plummeted 5.69% at Rs183.20, Bank of India tumbled 4.90% at Rs304.50, Bank of Baroda dropped 4.80% at Rs261.75, Indian Overseas Bank shed 4.69% at Rs124.10 and UBI declined 3.93% at Rs124.10. Federal Bank, Andhra Bank, Axis Bank and PNB slumped over 2-3% each. Among consumer durable stocks Gitanjali Gems, Bluestar, Videocon industries, Lloyd Element, Rajesh Export and Titan Industries shed 1-3% each.
Over 1.66 crore Chambal fertiliser shares changed hands on the BSE followed by IFCI (1.45 crore shares), Aishwarya Teelcom (1.41 crore shares), Ispat Industries (1.36 crore shares) and Nagarjuna Fertilisers (89 lakh shares).
NSE Bulk Deals to Watch - May 27 2008
Date,Symbol,Security Name,Client Name,Buy/Sell,Quantity Traded,Trade Price / Wght. Avg. Price,Remarks
27-MAY-2008,CHAMBLFERT,Chambal Fertilizers Ltd.,NEW VERNON INDIA LTD,BUY,2390000,76.01,-
27-MAY-2008,SITASHREE,Sita Shree Food Products,HARVESTDEAL SECURITIES LTD,BUY,110875,43.89,-
27-MAY-2008,TULSI,Tulsi Extrusions Limited,HARESH VITTHALDAS RAMI,BUY,190967,63.89,-
27-MAY-2008,SITASHREE,Sita Shree Food Products,HARVESTDEAL SECURITIES LTD,SELL,110875,43.96,-
27-MAY-2008,TULSI,Tulsi Extrusions Limited,HARESH VITTHALDAS RAMI,SELL,190967,64.28,-
BSE Bulk Deals to Watch - May 27 2008
Deal Date Scrip Code Scrip Name Client Name Deal Type * Quantity Price **
27/5/2008 532975 AISHWARYA TE CHIRAG D MEHTA B 67222 107.27
27/5/2008 532975 AISHWARYA TE RUPA VIPUL SHAH B 60000 104.38
27/5/2008 532975 AISHWARYA TE KASHISH FINSTOCK B 100000 108.88
27/5/2008 532975 AISHWARYA TE RIPON KISHOR MALHOTRA B 58000 108.14
27/5/2008 532975 AISHWARYA TE HEMANT MADHUSUDAN SHETH B 150000 107.50
27/5/2008 532975 AISHWARYA TE PRABHUDAS LILLADHER PVT. LTD. B 356635 106.13
27/5/2008 532975 AISHWARYA TE N D NISSAR B 157469 105.06
27/5/2008 532975 AISHWARYA TE AURANGABAD AUTO ANCILLARY PVT LTD B 117806 106.50
27/5/2008 532975 AISHWARYA TE KAUSHIK SHAH SHARES SEC PL B 128671 104.90
27/5/2008 532975 AISHWARYA TE MAMTA ANIL JAJODIA B 71172 106.18
27/5/2008 532975 AISHWARYA TE ANIL KUMAR JAJODIA HUF B 56000 105.35
27/5/2008 532975 AISHWARYA TE GOLDSTAR FINVEST PVT LTD B 80000 106.07
27/5/2008 532975 AISHWARYA TE ASTUTE COMMODITIES AND DERIVATIVES PVT LTD B 64489 107.80
27/5/2008 532975 AISHWARYA TE MANISH V SARVAIYA B 159617 106.65
27/5/2008 532975 AISHWARYA TE KAUSHIK SHAH SHARES SEC PL S 128671 104.82
27/5/2008 532975 AISHWARYA TE MAMTA ANIL JAJODIA S 71172 109.70
27/5/2008 532975 AISHWARYA TE ANIL KUMAR JAJODIA HUF S 56000 108.48
27/5/2008 532975 AISHWARYA TE ASTUTE COMMODITIES AND DERIVATIVES PVT LTD S 64485 107.60
27/5/2008 532975 AISHWARYA TE MANISH V SARVAIYA S 159617 106.82
27/5/2008 532975 AISHWARYA TE CHIRAG D MEHTA S 67222 107.29
27/5/2008 532975 AISHWARYA TE RUPA VIPUL SHAH S 60000 106.05
27/5/2008 532975 AISHWARYA TE RIPON KISHOR MALHOTRA S 58000 102.98
27/5/2008 532975 AISHWARYA TE PREM MOHANLAL PARIKH S 92740 107.42
27/5/2008 532975 AISHWARYA TE PRABHUDAS LILLADHER PVT. LTD. S 356635 106.22
27/5/2008 532975 AISHWARYA TE N D NISSAR S 157469 105.00
27/5/2008 532975 AISHWARYA TE AURANGABAD AUTO ANCILLARY PVT LTD S 112806 105.85
27/5/2008 532946 BANG MARUTI SECURITIES LTD S 76539 257.01
27/5/2008 590076 CAMSON BIO VIVEK MUNDRA B 100000 118.12
27/5/2008 590076 CAMSON BIO S ABDUL AZEEZ S 129000 118.10
27/5/2008 531682 CAT TECHNOL NEWGEN INTERNATIONAL PVT. LTD. S 183686 9.01
27/5/2008 531863 GEEKAY FINAN LOTUS GLOBAL INVESTMENT LIMITED B 30727 67.55
27/5/2008 531863 GEEKAY FINAN CRESTA FUND LTD B 70000 66.33
27/5/2008 531137 GEMSTONE INV PREM M PARIKH B 25000 23.04
27/5/2008 531137 GEMSTONE INV BHAVESH PRAKASH PABARI S 76000 23.01
27/5/2008 511116 HFCL INFOTEL MANOHAR MANAK ALLOYS PVT.LTD B 148573 19.83
27/5/2008 511116 HFCL INFOTEL HEMANT PRAKASH KANUGO S 148573 19.83
27/5/2008 531602 KOFF BR PICT SANJIV RAMNIKLAL JOSHI HUF B 25000 22.06
27/5/2008 531602 KOFF BR PICT LAXMI CAP BROKING PVT LTD S 43800 21.94
27/5/2008 513269 MAN INDUST I PRIYAL MANSUKHANI B 500000 103.15
27/5/2008 513269 MAN INDUST I JAGDISHCHANDRA J MANSHUKHANI S 500000 102.99
27/5/2008 526263 MOLDTEK TECH IMPERIAL CORPORATE FIN AND SER P S 59950 74.47
27/5/2008 521080 PASARI SPIN PRABHUDAS LILLADHER PVT. LTD. B 106642 13.28
27/5/2008 521080 PASARI SPIN PRABHUDAS LILLADHER PVT. LTD. S 106642 13.37
27/5/2008 521080 PASARI SPIN PASARI EXPORT LTD S 400000 13.00
27/5/2008 532692 RADHA MADHAV INDIASTAR MAURITIUS LIMITED S 272515 49.65
27/5/2008 532884 REFEX REFRIG HIMAT PURSHOTTAMBHAI JATANIA B 93000 215.00
27/5/2008 531898 SANGUINE MD CHINTAN BHAIDANI B 60000 28.00
27/5/2008 511607 SHLOKA INFO PARESH CHANDRAKANT DOSHI B 21031 51.07
27/5/2008 513530 STELCO STRIP SHIVA G GOLE B 50000 44.94
27/5/2008 531703 TRIBHVAN HSG CRESTA FUND LTD B 26000 80.12
27/5/2008 532948 TULSI EXTRU MINESH P GANDHI B 67686 64.00
27/5/2008 532948 TULSI EXTRU MINESH P GANDHI S 67686 64.12
Post Session Commentary - May 27 2008
Indian market took a U-turn after the mid session by pairing all its initial gains to close in red due to investors’ protective attitude during the second half and the negative cues from European markets, which were trading lower. The domestic market opened with a bang tracking the favoring cues from the Asian Markets, but was not able to sustain the momentum and fell after mid session as investors took cautious approach to book their positions. Today Indian rupee declined by 0.78% to Rs42.89/USD. This led the IT sector to obtain support from the market. However, there was lack of support in banking, oil & gas and reality stocks, which adds on heavy selling pressure. The market breadth was negative as 992 stocks closed in green while 1760 stocks closed in red and 81 stocks remained unchanged.
The BSE Sensex closed lower by 72.91 points at 16,275.59 and NSE Nifty fell by 15.25 points to close at 4,859.80. The BSE Mid Cap and Small Cap closed down by 81.86 points and 108.12 points to 6,678.91 and 8,210.08 respectively.
Losers from the BSE are SBI (4.19%), HDFC (2.08%), ICICI Bank Ltd (1.71%), ONG Corp Ltd (1.34%), Reliance (1.25%), HDFC bank Ltd (1.20%), DLF Ltd (0.80%), Tata Steel (0.80%), Hindalco (0.48%) and JP Associates (0.42%).
The IT index ended up by 32.40 points to close at 4450.40. Major gainers are Satyam Comp (3.29%), Wipro Ltd (2.71%), I-flex (2.22%), HCL Tech (1.08%) and Tech Mahindra (0.98%).
The Banking index closed lower by 184.61 points at 7,754.64. Losers are OBC (5.69%), Bank of India (4.90%), Bank of Baroda (4.80%), Indian Overseas Bank (4.69%), SBI (4.19%), and Union Bank (3.93%).
The Reality index closed down by 113.99 points at 7,226.10. Losers are Pheonix Mill (4.71%), Unitech Ltd (4.21%), Penland Ltd (4.02%), Ananat Raj In (3.56%), and Ansal Infra (3.37%).
The Oil & Gas index decreased by 112.75 points at 10,707.90. Losers are Cairn India (2.98%), Reliance Pet (2.30%), ONG Corp Ltd (1.34%), Reliance (1.25%) and Reliance Nat Res (0.81%).
The Consumer durables index was down by 85.01 points to close at 4,385.96. Major losers are Gitanjali GE (3.45%), Blue Star L (2.1%), Videocon Ind (1.87%), Lloyd Ele En (1.77%), Rajesh Export (1.54%) and Titan India (1.10%).
Metal index closed lower by 72.44 points at 16,270.77, losers are Welspan Gujarat SR (4.87%), Jindal Steel (4.01%), Sh Precoated SR (3.52%), Ispat Indus (3.23%), Hindustan Zinc (1.91%), and Maharashtra Sea1.71%
Bank stocks lead market fall
Weakness in the second half of the trading session dragged the market lower today. The market sentiment was hit by reports which trickled in the market in afternoon trade that one of the options that the government may consider to bail out oil firms which are bleeding due to a surge in crude oil prices, was levying of a cess or surcharge on income tax and corporate tax.
Banking stocks were the worst sufferers in today's fall. State Bank of India slumped. Information technology stocks held firm.
Asian markets edged higher today, 27 May 2008, as bargain hunters scoured the market after five days of losses. Key indices in China, Japan, Hong Kong, Taiwan, South Korea and Singapore were up by 0.39% to 1.48%.
But European markets, which opened after Indian market, were mostly in the red. Key indices in France and Germany were down 0.42% to 0.53%. UK's FTSE 100 was up 0.11%. US markets were closed on Monday, 26 May 2008, for Memorial Day holiday.
The 30-share BSE Sensex fell 72.91 points or 0.45% at 16,275.59. The Sensex lost 110.58 at the day’s low of 16,237.92, hit in the mid-afternoon trade. The market opened on an upbeat note tracking firm Asian stocks. Sensex climbed 157.85 points at day's high of 16,506.35, hit in early trade
The broader based S&P CNX Nifty was down 15.25 points or 0.31% at 4859.80. Nifty May 2008 futures were at 4851.90, a discount of 7.9 points against the spot closing.
The NSE's futures & options (F&O) segment turnover was at Rs 49,968.5 crore, higher than Rs 44103.52 crore on Monday, 26 May 2008. BSE clocked a turnover of Rs 5074 crore in the cash segment as against Rs 4,426.96 on Monday, 26 May 2008.
As per provisional data, foreign funds sold shares worth a net Rs 496.61 crore today. Domestic funds bought shares worth a net Rs 529.69 crore.
The market breadth, which was firmly positive earlier in the day, turned negative as the session proceeded, with 922 shares advancing on BSE as compared to 1760 stocks that declined. 81 stocks remained unchanged.
The BSE Mid-Cap index fell 1.21% to 6,678.91 and BSE Small-Cap index lost 1.30% to 8,210.08. Both the indices underperformed the Sensex.
Major Sensex losers were, Housing Development Finance Corporation (down 2.08% at Rs 2519.75), ONGC (down 1.34% at Rs 884.35), HDFC Bank (down 1.20% at Rs 1331.30) and DLF (down 0.80% at Rs 596.45).
Major Sensex gainers were, Cipla (up 3.04% at Rs 205.05), ITC (up 1.65% at Rs 209.10), Ambuja Cements (up 0.98% at Rs 97.60), NTPC (up 0.97% at Rs 177.40) and Reliance Infrastructure (up 0.86% at Rs 1259.30).
India's second largest listed telecom services provider by sales Reliance Communication (RCom) rose 1.57% at Rs 551.75 on reports the proposed deal between Reliance Communications and South Africa's MTN Group may involve an open offer by the South African telecom firm to the shareholders of Reliance Communications. The deal may result in a transfer of Anil Ambani's two-third equity stake in Reliance Communications to MTN shareholders, the reports added.
The RCom stock had tumbled 5.08% to Rs 543.20 on Monday, 26 May 2008, after the company said it was in merger talks with MTN.
India’s largest private sector firm by market capitalization & oil refiner Reliance Industries fell 1.25% at Rs 2493.20.
The BSE Bankex underperformed the Sensex, falling 2.33% at 7,754.64. Oriental Bank of Commerce (down 5.69% at Rs 183.20), Bank of India (down 4.90% at Rs 304.50), Bank of Baroda (down 4.80% at Rs 261.75) and Axis Bank (down 2.96% at Rs 740.40), dropped.
India’s largest commercial bank State Bank of India slumped 4.19% at Rs 1473.30, on concerns the bank’s surprise hike of 25-50 basis points in deposit rates could put pressure on its operating profit margin in the short term. In an announcement made after market hours yesterday, 26 May 2008, State Bank of India said that two to three year term deposit rate will be raised to 8.75% from 8.5%, and five to ten year deposits would fetch 9% from 8.5%, effective from 1 June 2008. The hike in deposit rates is aimed at attracting more funds to meet aggressive growth targets
India’s largest private sector bank by assets ICICI Bank declined 1.71% at Rs 812.55.
The BSE IT index outperformed the Sensex, gaining 0.73% at 4,450.40. Satyam Computer (up 3.29% at Rs 499), Wipro (up 2.71% at Rs 491.60), HCL Technologies (up 1.08% at Rs 299.05), TCS (up 0.81% at Rs 966.60), rose. However, India's second largest software exporter by sales Infosys Technologies fell 0.42% at 1878.55.
Among the mid-caps, Jyoti Structures (down 6.90% at Rs 132.15), BGR Energy (down 6.89% at Rs 379.80), Brigade Enterprise (down 6.88% at Rs 191.45), and Elecon Engineering Company (down 6.70% at Rs 125.40), slipped.
Among the small-caps, Confidence Petroleum (down 10% at Rs 17.65), Kirloskar Pneumatic Company (down 7.34% at Rs 394), Elantas Beck (down 6.97% at Rs 263.05), Emkay Share And Stock Brokers (down 6.89% at Rs 125) and Eicher Motors (down 6.79% at Rs 358.20), tumbled.
Bajaj Finserve clocked the highest turnover of Rs 208.92 crore on BSE. Reliance Capital (Rs 195.04 crore), Reliance Industries (Rs 159.70 crore), Aishwarya Telecom (Rs 150.44 crore) and Reliance Power (Rs 143.90 crore), were the other turnover toppers on BSE in that order.
Chambal Fertilisers and Chemicals registered the highest volume of 1.67 crore shares on BSE. IFCI (1.45 crore shares), Aishwarya Telecom (1.41 crore shares), Ispat Industries (1.36 crore shares) and Reliance Natural Resources (1.16 crore shares), were the other volume toppers on BSE in that order.
Cooking appliances maker Hawkins Cookers jumped 8.85% to Rs 183.95 after the company’s board of directors recommended a liberal dividend of Rs 10 per share in a board meeting held on Monday, 26 May 2008.
Sandur Manganese and Iron Ores was locked at upper limit of 5% at Rs 1185.65 on sustained buying after the company’s management guided a whopping 10-fold jump in net profit for the year ending March 2009, on 13 May 2008.
Automobile batteries maker Amara Raja Batteries jumped 0.90% at Rs 191 on reports the founders of the company have decided to form a holding corporation that will take under its wing five group companies and the newly formed Amara Raja Infra.
IT firm HTMT Global Solutions soared 0.11% to Rs 360 on reports the firm is planning to acquire a mortgage-specific company in the UK. The business process outsourcing (BPO) and IT services provider may invest more than $150 million for the buyout. HTMT has internal accruals of $110 million which will be used for the acquisition, the reports added.
Engineering firm Kirloskar Electric Company spurted 2.37% at Rs 188.05 on reports the firm has mounted a bid to acquire Germany's Lloyd Dynamowerke based on an estimated enterprise valuation of about $100 million.
Food products supplier Sita Shree Food Products advanced 2.25% to Rs 43.25 after the company said it had received orders from Reliance Fresh for 400 metric tonnes of wheat flour and pulses, higher from its previous order for 160 metric tonnes.
Industrial equipment maker Thermax jumped 1.92% to Rs 438.30 after the company said its boiler & heater business unit has received an export order worth 14.2 million euro for supply of heat recovery steam generator to an oil company in Europe.
Bhuwalka Steel Industries, which manufactures steel billets, gained 2.22% to Rs 83 after the company said it expects revenue of Rs 125 crore and rental income of Rs 12 crore a year, from redevelopment of a mill property in Bangalore.
Asian Markets Recovers From Yesterday Debacle
Nikkei, Kospi Lead the Gain while Sensex, KLSE registered a fall
Asian Markets recovered from yesterday’s mayhem, as investors snapped up beaten-down shares. However the trading in region remain thin as the markets in the U.S. and U.K. were closed yesterday. Japan’s Nikkei and South Korean Kospi recorded a sharp recovery while Shanghai and Sydney posted modest gains.
Japan's Nikkei 225 was 1.5% higher at the end of the day closing at 13,893.31 The market has rebounded from a 2.3% decline in the previous session that left the benchmark at a two-week low. The Topix index added 1.8% to 1,368.25.
Commodity-related shares and financial stocks such as Commonwealth Bank eked out modest gains in Sydney. Australia's S&P/ASX 200 was up 0.1% to 5,714.40.
South Korea's Kospi benchmark index climbed into positive territory after six losing sessions. South Korea's Kospi firmed 1.4% to 1,825.23.
Taiwan's Weighted Price Index was up 0.8% to 8,778.39 and Singapore's Straits Times index added 0.6% to 3,121.29. Malaysia's KLSE Composite added fell 0.1% to 1,272.01.
Hong Kong's Hang Seng Index ended the day 0.6% higher at 24,282.04 and the Hong Kong China Enterprise index added 0.8% to 13,330.08.
China's Shanghai Composite was up 0.3% to 3,375.41 while the Shenzhen Composite added 0.9% reaching 1,082.32 levels.
In the afternoon trading India's Sensitive Index, or Sensex, was down by 0.4% to 16,279.17 and the broader S&P/CNX Nifty fell 0.2% to 4,864.05.
Meanwhile, crude oil for July delivery climbed 95 cents to $133.14 a barrel in electronic trading at midday in Tokyo.
In currencies, the yen was quoted at 103.32 yen at midday in Tokyo, compared with 103.35 yen there late Monday.
The European markets advanced in their morning session taking a cue from the upbeat action in Asia, and fueled by strong gains from wireless giant Vodafone Group and chipmaker Infineon Technologies and an advance for the mining sector.
Overall, the U.K. FTSE 100 index advanced 0.8% to 6,136.10 as investors returned from a long holiday weekend, while the French CAC-40 index rose 0.4% to 4,958.14.
The German DAX 30 index climbed 0.2% to 6,790.35 as the economy posted a robust growth in the first quarter of 2008. On the quarter, real gross domestic product rose 1.5%, after gaining 0.3% in the fourth quarter of 2007. The annual growth rate accelerated to 2.6% from 1.8% in the fourth quarter.
The data, which are adjusted for seasonal and calendar effects, are in line with preliminary GDP "flash" estimates the statistics office had published May 15.
Household spending, which has been sluggish for years, rose 0.3% on the quarter, adding 0.2 percentage point to the quarterly growth rate, the data showed.
On the quarter, investment in machinery and equipment surged 4.0%, which is above the 3.4% gain recorded in the previous quarter, the data showed.
A mild winter also buoyed construction spending, which gained 4.5% on the quarter, after declining 0.5% in October-December.
The sharp slowdown in U.S. economic growth and a stronger euro may also have left a mark on foreign trade, the data indicate. Net trade shaved 0.2 percentage points off Germany's quarterly growth rate, as exports rose 2.4% and imports increased 3.5%.
A strong build-up in inventories contributed 0.7% to GDP growth, the data showed.
Public consumption jumped 1.3% in the first quarter, after slipping 0.6% in the last three months of 2007.
Apart from this a composite indicator of French business confidence fell to 102 in May from 106 in April. The indicator reflects the level of positive business leader opinion on the overall output outlook, their own output outlook, past production, inventories and order books.
Pre Session Commentary - May 27 2008
The Indian Market is likely to have a positive opening on the back of favorable cues from the Asian markets as it is trading on the strong note. On Monday, unfavorable global cues like surging crude oil prices and increasing inflationary worries led the Indian market to open on back foot and continued the same throughout the trading session to close in negative. Also the expiry of derivatives contract on coming Thursday added to the sentiments. From the sectoral front, the metal, capital goods, banking and reality stocks were not in favor due to lack of support. However IT stocks were in limelight as it was only index to trade in green The BSE Sensex closed lower by 301.14 points at 16,348.50 and NSE Nifty fell by 71.5 points to close at 4,875.05. We expect that the market may gain further during the trading session.
The government is working on a dual-track strategy of fuel price hikes and the duty cuts. The finance ministry has asked the petroleum ministry to work out the strategy of duty realizations and their impact on oil companies.
On Monday, the US markets were closed for the celebration of Memorial holiday.
Today the major stock markets in Asia are trading firm. Hang Seng index is trading higher by 136.21 points at 24,263.52 along with Japan’s Nikkei trading up by 112.43 points at 13,802.62 and Taiwan Weighted trading at 8,756.69 up by 48.86 points.
The FIIs on Monday stood as net seller in equity and debt. The gross equity purchased was Rs2,350.70.00 Crore and the gross debt purchased was Rs0.00 Crore while the gross equity sold stood at Rs2,351.200 Crore and gross debt sold stood at Rs130.10 Crore. Therefore, the net investment of equity reported was (Rs500.50 Crore) and net debt was (Rs130.10 Crore).
Today, Nifty has support at 4793 and resistance at 4987 and BSE Sensex has support at 16132 and resistance at 16724.
Market may open higher on firm Asian markets
The market is likely to open higher tracking positive Asian markets. In absence of any near term major domestic trigger with Q4 March 2008 results almost over, market is likely to dance in line with global cues.
Expiry of May 2008 futures & options series on Thursday, 29 May 2008 will keep the market volatile in the coming days. As per reports, rollover of Nifty positions from May 2008 series to June 2008 series stood at 39% and marketwide positions were 30%, as on 26 May 2008.
Asian markets were trading firm today, 27 May 2008, as bargain hunters scoured the market after five days of losses. Japan's Nikkei (up 0.82% at 13,802.62), Hong Kong's Hang Seng (up 0.56% at 24,263.52), Taiwan's Taiwan Weighted (up 0.56% at 8,756.69), South Korea's Seoul Composite (up 0.94% at 1,817.56) and Singapore's Straits Times (up 0.05% 3,105.24), edged higher. However China's Shanghai Composite fell 3.13% at 3,364.54.
US markets were closed on Monday, 26 May 2008 for Memorial Day.
Back home, relentless selling in banking, and capital goods stocks led the fall on Monday, 26 May 2008. The 30-share BSE Sensex was down 301.14 points or 1.81% at 16,348.50 and the broader based S&P CNX Nifty was down 71.5 points or 1.45% at 4875.05, on that day.
As per provisional data, foreign funds sold shares worth a net Rs 1337.33 crore on Monday, 26 May 2008. Domestic funds bought shares worth a net Rs 842.05 crore on that day.
Foreign institutional investors (FIIs) were net sellers of Rs 638.39 crore in the futures & options segment on Monday, 26 May 2008. They were net sellers of index futures to the tune of Rs 361.74 crore and bought index options worth Rs 40.72 crore. They were net sellers of stock futures to the tune of Rs 387.22 crore and bought stock options worth Rs 69.85 crore.
Reliance Communications MTN Merger ?
Two days after talks between Bharti Airtel and MTN were called off, Reliance Communications (RCom) said it has signed a 45-day exclusivity agreement with the South African telecom company to discuss a "potential combination of their businesses".
This effectively means MTN will not talk to other potential bidders while discussions are on with the Reliance Anil Dhirubhai Ambani Group company.
MTN had not agreed to a similar exclusivity agreement with Bharti Airtel, with which talks broke down following differences over control of the combined entity.
Investment banking sources said both MTN and RCom have decided that they would not work on a merger. RCom has also said it would not look at either raising debt or expanding the company's equity base to accommodate new shareholders. Banking circles said the new structure under discussion would help MTN achieve its objective of expanding its footprint in India.
For RCom, MTN would offer its experience in running GSM networks. This is critical since RCom, which is a CDMA operator, will shortly launch a pan-Indian GSM network. MTN also has expertise in offering 3G services in South Africa, which RCom could leverage in India. MTN, on the other hand, could leverage Reliance's non-mobile business enterprise and its large submarine cable network across 60 countries.
Investment bankers said one option being discussed is whether both companies take a certain equity stake in each other and work as a consortium to address challenges in emerging markets.
Banking circles close to the new deal said the Bharti Airtel deal failed on the issue of foreign direct investment (FDI) since a merger would have breached the 74 per cent FDI limit. Bharti chief Sunil Mittal, however, said the FDI limit was never the issue.
Meanwhile, RCom shares fell 5.08 per cent, closing at Rs 543.20. MTN's scrip also dropped 7.2 per cent at 144.70 South African rands on the Johannesburg Stock Exchange in morning trade following news that its negotiations with Bharti had fallen through. The company's share price had risen sharply after talks with Bharti on a takeover started in the first week of May.
A combination of MTN and RCom would create a telecom behemoth with over 115 million mobile customers across 23 countries (see table). This is smaller than the Bharti Airtel-MTN combination (131 million customers), but would catapult RCom ahead of its key rival in the Indian market. Bharti Airtel has 17 million more customers than RCom (62 million and 45 million respectively).
A combination of the MTN and RCom 2008 balance sheets would create a $14.4 billion (Rs 58,000 crore) company, making it the second most profitable mobile operator after China Mobile, according to insiders working on the deal.
The combine would also have the largest Wimax footprint globally covering 3 billion people, nearly half the world's population. RCom's Wimax footprint is currently limited to India (where it has less than 22,000 customers) and 22 other countries in Asia Africa and Latin America. The combine will also have one of the world's largest optical fibre networks touching over 60 countries.
via Business Standard
Asian Markets Positive early morning
Asian markets opened on positive note on Tuesday (May 27, 2008), due to the buying interest at the lower levels.
Japan`s biggest carmaker, Toyota Motor, rose after share price sank touched one month low. The world`s second-largest chipmaker, Samsung Electronics rose after Nomura Holdings raised its rating.
Japan`s index Nikkei 225 rose 112.43 points, or 0.82%, to trade at 13,802.62.
Hong Kong`s index Hang Seng rose 108.94 points, or 0.45%, to trade at 24,236.25.
China`s Shanghai Composite rose 3.44 points, or 0.10%, to trade at 3,367.98.
Taiwan`s Taiex index rose 55.13 points, or 0.63%, to trade at 8,762.96.
South Korea`s KOSPI rose 16.34 points, or 0.91%, to trade 1,816.92.
Singapore`s Straits Times rose 2.08 points or 0.07%, to trade at 3,105.38. (8.31 a.m. IST)
Trading Calls - May 27 2008
Nifty (4875) Supp 4830 Res 4958
Buy Nalco (539) SL 534
Target 549, 554
Buy Neyveli Lignite (142) SL 138 Target 150, 153
Buy Lanco Infra (518) SL 513
Target 528, 534
Sell Century (727) SL 733
Target 716, 712
Sell HDFC (2573) SL 2593
Target 2530, 2520
Let go a little!
It's all right letting yourself go, as long as you can get yourself back.
Some bargain picks in recent days may make you some money today. With the US market taking a day's break and no fresh negative news emerging overnight, the key indices could just witness some relief. In case it turns into a rally, use it to pocket some quick gains. Today we see a bounce at the opening bell and perhaps a brighter day though the undertone has yet again turned weak.
The firm trend across Asia this morning may just prove to be enough of a catalyst for the bulls to stage some kind of a comeback. However, be on guard as selling pressure will return at higher levels amid a slew of concerns, local as well as global.
The trend over the next few days will be choppy as market players brace for Thursday's F&O expiry and Friday's GDP numbers. Of course, weekly inflation will continue to cast its gloomy shadow on the market. What's more, things on inflation front could get worse as and when the Government announces the impending hike in retail fuel prices. This won’t happen till Friday at least.
The market may also get jitters due to the emerging political situation, which doesn't seem to favour the ruling coalition. There are fears that following the recent electoral setbacks, the Congress-led regime may unveil more populist measures. On the flip side, there is a school of though which reckons that a BJP-led government (if it wins next year's general elections) will actually be good for the markets.
FIIs were net sellers of Rs13.37bn (provisional) in the cash segment on Monday while local institutions were net buyers of Rs8.42bn. On Friday, FIIs offloaded Indian shares worth Rs5bn from the cash segment. Mutual Funds were net buyers of Rs186mn.
Key Results Today: Bajaj Electricals, Camlin, Emco, Jindal Steel & Power, Neyveli Lignite, Opto Circuits, Plethico Pharma, Tata Coffee and ZF Steering.
Asian stock benchmarks rose for the first time in six days, rebounding from their steepest fall in more than two months, as investors snapped up battered stocks after the recent declines.
Toyota rallied after its price sank to the lowest in more than a month relative to earnings. Samsung advanced in Seoul after Nomura Holdings raised its rating. Oji Paper Co. led gains by Japanese papermakers after UBS said higher selling prices will help counter rising costs.
The MSCI Asia Pacific Index added 1% to 148.79 as of 10:43 a.m. in Tokyo, snapping a 4.5% decline in the previous five sessions, the sharpest drop and the longest losing streak since the period ended March 5.
More than two stocks advanced today for each that dropped on the MSCI Asia Pacific index, and all 10 industry groups gained. Most Asian benchmark indexes also rose, with Japan's Nikkei 225 Stock Average gaining 1% to 13,828.08.
US markets were shut on Monday on account of Memorial Day. Markets were also closed in the UK. In the rest of Europe, stock indices ended marginally higher.
The pan-European Dow Jones Stoxx 600 index edged 0.2% lower to 318.37. The German DAX 30 rose 0.2% to 6,957.50 and the French CAC 40 added 0.2% to 4,941.61. The Swiss SMI fell 1.3% to 7,363.90.
Markets in Europe and the US declined last week after a report showed that the number of unsold US homes piled up to a 23-year high in April.
Shares of UBS, which on Tuesday will trade without rights to a discounted stock offer, dropped 5.8%. The Swiss bank said in a prospectus that it may take more losses tied to international real estate.
Oil prices rose above $133 per barrel on persistent worries about global supplies, the fate of the US economy and the dollar. Reports of an attack by militants on an oil pipeline in Nigeria, one of Africa's largest oil exporters, also helped boost prices.
Light, sweet crude for July delivery on the New York Mercantile Exchange was up 88 cents at $133.07 a barrel in electronic trading by late afternoon in Europe. The contract rose $1.38 to settle at $132.19 a barrel on Friday.
The dollar has weakened over the last week, making dollar-denominated commodities like crude attractive to global investors. Oil and other hard commodities are seen as hedges against a weakening dollar and inflation.
This week, Wall Street investors will be awaiting economic data on US consumer confidence, new home sales and gross domestic product (GDP). The reports are sure to have some impact on the dollar and oil prices.
The dollar was lower against the yen, but rose a bit against the euro in currency trading during the afternoon in Europe after losing ground Friday in New York.
In the emerging markets, the Bovespa in Brazil rose 0.25% to 71,628 while the IPC index in Mexico was up 0.8% at 31,314. The RTS index in Russia added 0.06% at 2436 while the ISE National 30 index in Turkey slid 1.7% to 47,956.
Warren Buffett says that the US economy is already in a recession. Asked by Germany's Der Spiegel weekly whether he thinks the US could still avoid a recession, he said as far as the average person is concerned, it is already here.
"I believe that we are already in a recession," Buffet was quoted as saying in an interview published on Sunday. "Perhaps not in the sense as defined by economists. ... But people are already feeling the effects of a recession. It will be deeper and longer than what many think," he added.
Market may turn choppy
Markets ended the way it started on a weak note. Losses were extended to third straight trading session on back of negative cues from the US and the Asian markets. The large cap stocks were under pressure during today’s session. Further no positive trigger on the horizon with even the European markets taking off on a dull note dragged the Nifty index to close below the 4,900 mark.
Finally, the BSE benchmark Sensex ended 301 points lower to close at 16,348 and the Nifty index slipped 71 points to close at 4,875.
Overall about 669 stocks advanced; 2,041 stocks declined while 48 stocks remained unchanged. Among the 50-Nifty 40 stocks ended in red and 10 stocks ended in green.
Bajaj Auto Limited manufacturers and distributors of motorized two & three wheeler motorcycles got re-listed on the bourses on Monday and started trading at Rs784. The stock finally ended at Rs604 hitting an intra-day high of Rs945 and a low of Rs556 recording volumes of over 23,00,000 shares on NSE.
Similarly, Bajaj Finserve, Rahul Bajaj's new firm, also got listed on the bourses on Monday. Bajaj Finserve comprises of financial services and wind farm businesses of Bajaj Auto and has major presence in insurance, consumer finance and distribution space. Apart for this, Bajaj Finserve is considering a foray into the MF business, as Bajaj group is in negotiations with Allianz group. Bajaj Finserve got listed at Rs530 per share and finally ended at Rs514 hitting an intra-day high of Rs999 and a low of Rs503 recording volumes of over 21,00,000 shares on NSE.
The auto major Bajaj Auto was de-merged into three new entities Bajaj Holdings & Investments, Bajaj Auto and Bajaj Finserv. Bajaj Holdings & Investment, formerly Bajaj Auto, now functions as an investment company and focuses on new business opportunities. The new Bajaj Auto focuses on the automotive business, while Bajaj Finserv is engaged on wind energy generation, insurance and finance.
GMR Infrastructure declined by 3.2% to Rs134. The company said that they may partner Petronas to jointly bid for oil blocks in India, reports stated. The scrip touched an intra-day high of Rs138 and a low of Rs132 and recorded volumes of over 13,00,000 shares on NSE.
Hindustan Unilever also lost ground and slipped by 2% to Rs231 as reports stated that it hiked prices between 3-28% over the past one and a half months. The scrip touched an intra-day high of Rs239 and a low of Rs229 and recorded volumes of over 1,00,000 shares on NSE.
NIIT Technologies slipped 5% to Rs147. The global IT services provider announced a collaboration with the National Aviation Company of India (NACIL) and Singapore Airport Terminal Services (SATS) consortium (AI SATS Airport Services), involving the implementation of a Cargo Operations System (COSYS) to support the consortiums cargo handling operations at the new Bengaluru International Airport.
The scrip touched an intra-day high of Rs154 and a low of Rs146 and recorded volumes of over 2,00,000 shares on NSE.
HDIL lost by over 5% to Rs722. The company plans to bid for 10 of the 57 NELP VII hydrocarbon blocks, according to reports.
HDIL is reportedly foraying into the oil and gas segment. The report added that HDIL was likely to bid with a foreign partner for its oil and gas foray. The scrip has touched an intra-day high of Rs750 and a low of Rs716 and recorded volumes of over 9,00,000 shares on NSE.
SBI ended lower by 2.3% to Rs1537. The company announced that it raised deposit rates for 3-5 years deposits by 35bps to 8.85% and raised deposit rates for 5-10 years deposits by 50bps to 9%. The scrip touched an intra-day high of Rs1561 and a low of Rs1530 and recorded volumes of over 3,00,000 shares on NSE.
Omaxe ended 2% lower to close at Rs210. The company announced that it posted a net profit of Rs3988.03mn for the year ended March 31, 2008 as compared to Rs1248.30mn for the year ended March 31, 2007. The total Revenue has increased from Rs9475.65mn for the year ended March 31, 2007 to Rs18120.34mn for the year ended March 31, 2008.
The Board of Directors of the Company at its meeting held on May 26, 2008 has recommended a final dividend of 25% on paid up Equity Share Capital subject to approval of Shareholders. The scrip touched an intra-day high of Rs220 and a low of Rs209 and recorded volumes of over 2,00,000 shares on NSE.
With the US stocks being closed on account of ‘Memorial Day Holiday’, there would be no cues coming in from the US markets. So one could expect another dull day with slight volatility.
Corporate News
Reliance Power and GMR Infrastructure are planning to bid for PowerSeraya and Senoko Power, which account for more than 60% of the power produced in Singapore. (BS)
TCS has signed a five-year deal worth US$100mn with NXP Semiconductors. (ET)
Reliance Industries is in talks with PSU oil refining companies to sell its crude oil to be produced from MA field in its prolific D6 Block in offshore Krishna-Godavari Basin. (DNA)
Indiabulls Real Estate plans to sell 353mn shares of Indiabulls Properties Investment Trust at between US$1 and US$1.1 apiece. (DNA)
Taj GVK plans to invest over Rs5bn in its existing and new properties in south India over the next 2-3 years. (DNA)
NMDC may review exports to Japanese steel mills and South Korea's Posco to increase domestic availability of iron ore. (BS)
Tata Chemicals has launched Tata Salt Lite, a new brand of low sodium salt. (BL)
Eicher Goodearth Investments, the holding company of Eicher Motors, plans to buy back 13.12% of public holding at Rs691.68/share. (ET)
Eicher Motors plans to buy back the 3.6% stake held by German auto major Daimler Motors. (ET)
Tata Motors is in the process of re-organizing its manufacturing facilities for commercial vehicles, and intends to create hubs for a particular category of vehicle at each of its various production units. (BL)
Educomp Solutions is planning to raise US$500mn through ADR, GDR, FCCB, or QIP. (BL)
Omaxe is entering into power generation by forming a JV with Isolux, a Spanish firm. (ET)
Kirloskar Electric bids for acquiring German’s Lloyd Dynamowerke at an estimated enterprise valuation of ~US$100mn. (ET)
Amara Raja Batteries has forayed into two-wheeler battery segment. (ET)
Apollo Hospitals is scouting for inorganic opportunities in Spain and Peru. (ET)
HTMT Global plans to acquire a mortgage-specific company in the UK soon with an investment of over US$150mn. (DNA)
Warburg Pincus-controlled WNS Holdings is working on an outright acquisition or a strategic merger with Firstsource Solutions. (ET)
UTV New Media, the digital media arm of UTV Software is acquiring a controlling stake of 76% in 'IT Nation', a leading online infomediary. (ET)
Power Finance Corp.’s subsidiary PFC Consulting has formed three SPVs, for power projects in Orissa. (Mint)
Videocon may merge some of its factories to improve efficiencies and boost sales in a bid to gain an upper hand on competitors Samsung, Whirlpool and LG. (BS)
Fidelity Mutual fund has acquired a further 1.55% stake in Jyothy Labs, raising its holding to 5%. (ET)
RPG Group plans to invest Rs90bn in the power, tyre and carbon black industries as part of its expansion in the coming two years. (ET)
The Essel group owned Dish TV, is aiming to double its customer base to two lakh a month. (ET)
Leading Australian financial services firm Link Group plans to acquire a majority stake in Intime Spectrum Registry. (ET)
Harrisons Malayalam is planning to invest Rs560mn in its various plantations in Kerala. (BS)
Over 650 drugmakers have asked the Government to immediately increase prices of 33 bulk drugs. (ET)
BlackBerry vendor Research-In Motion (RIM) is not willing to hand over the message encryption key to the Government. (ET)
Economic News
The DoT has called a meeting with operators on May 28 to discuss the allocation and pricing of 3G spectrum. (BS)
The Finance Act 2008 has modified and rationalised the CENVAT Credit Rules, 2004 (Credit Rules) and removed some anomalies. (BS)
The Government may consider 49% FDI in gems & jewellery and apparel. (ET)
The Government is working on a dual track strategy of fuel price hikes and duty cuts to protect consumers as well as cash strapped oil companies. (ET)
The Gujarat government is planning to invite private companies to invest in five new power projects worth Rs200bn during the upcoming Vibrant Gujarat Global Investors' Summit. (BS)
Cotton production outlook for the next season (August-July) has been kept unchanged at a record 33mn bales (of 170 kg each). (BL)
SEBI has proposed a maximum post-issue capital of Rs250mn for companies to be eligible to participate in the proposed SME exchange. (BL)
The Himachal Pradesh Government has sought the Centre’s approval to levy generation tax on hydropower projects in the state and extension of the industrial package till 2013. (Mint)
India could miss by 20%, or 13,855MW, its target of adding almost 70,000MW of power over the next four years because of poor transport infrastructure. (Mint)
A shortage of globally-recognized testing labs could impact India’s drugs and chemical exports to Europe, worth some US$2.7bn in 2007. (Mint)
ITC - Good show
ITC’s financial performance for the quarter and year ended 2007-08 demonstrates that the cigarette business has held up well under the burden of new taxes, while its other FMCG forays are growing at a fast clip, amidst considerable competition. However, profit growth continues to be sedate as the company continues to spend aggressively on establishing its multiple new businesses.
Cigarettes resilient
Despite a 30 per cent increase in tax incidence on cigarettes by way of VAT, CST and other imposts, the business closed the year with a 7.7 per cent growth in gross sales. PBIT (profit before interest and taxes) margins on the business also expanded, indicating strong pricing power that has enabled the company to pass on the new taxes to consumers, without a big impact on offtake.
Going forward, the company plans to discontinue production of non-filter cigarettes (which have seen a sharp hike in duties in the recent budget). While this may cause a near term blip (non-filter segment contributes to a tenth of sales) in volumes and sales, it may prevent a significant decline in margins in this segment; ITC could also benefit from any upgrading to the filter cigarettes segment.
Traction in FMCGs
ITC’s other FMCG forays - mainly into branded packaged foods (57 per cent growth in FY08), driven by branded staples, biscuits, ready-to-eat and snack foods, have sustained a robust pace of growth, suggesting that the company has managed to gain market share in each of these categories. However, ITC continues on a high-spend path to growth, as overall losses on the FMCG business (excluding cigarettes) have swelled from Rs 201 crore last year to Rs 263 crore for 2007-08. Businesses such as paper and agri- commodities trading have improved their contribution to revenues, with accelerated growth in the March quarter relative to the first nine months of the fiscal.
Despite the scorching pace of growth in new businesses and profit margin expansion in many segments, ITC’s net profit growth at 15.5 per cent for full year (14 per cent for Q4) remains moderate, weighed down mainly by promotional spends on the FMCG businesses.
With the stock already trading at a PE multiple of 26 times its FY08 earnings, there may be limited room for re-rating relative to other FMCG companies in the near-term.
via BL
Today's Pick - Central Bank of India
We recommend a sell in Central Bank of India from a short-term perspective. It is evident from the charts that the stock has been on an intermediate-term downtrend from its 52-week-high of Rs 154 recorded in early January 2008. However, after marking a one-year low at Rs 73 in March, the stock began moving higher till it encountered resistance at around Rs 100 level.
Subsequently, the stock failed to exceed that resistance level and resumed the downtrend. The daily and weekly relative strength indices are featuring in the bearish zone. Besides, the moving average convergence and divergence has re-entered the negative territory indicating bearishness. The stock is also trading well below the 21 and 50-day moving averages at present. In the short-term, we are bearish on the stock and expect it to decline further until it hits our price target of Rs 78 in the coming days. Traders with short-term perspective can sell the stock while keeping the stop-loss at Rs 89.
via BL
Company Background - Dr Reddy's Labs
Dr. Reddy's Laboratories was came to on track in the year 1984 in Hyderabad, it was established by Dr Anji Reddy with an initial capital outlay of Rs.25 lakhs. It is a global pharmaceutical company with a presence in more than 100 countries and its doing well with wholly-owned subsidiaries in the US, UK, Russia, Germany and Brazil; joint ventures in China, South Africa and Australia; representative offices in 16 countries; and third-party distribution set ups in 21 countries. The company proven research capabilities and vertically integrated with a presence across the pharmaceutical value chain and it conducts research in the areas of diabetes, obesity, cardiovascular diseases, anti-infectives and inflammation. The Indian based company produces finished dosage forms, active pharmaceutical ingredients and biotechnology products which are marketed globally, with focus on India, US, Europe and Russia.
The company made its beginning with the manufacture of Active Pharmaceutical Ingredients and Intermediates (API) in 1984 and commenced operations with a single drug in a 60-tonne facility near Hyderabad, India. In 1986, the first consignment of that drug, Methyldopa, was shipped to West Germany. In 1988 the company acquired Benzex Laboratories Pvt. Limited to expand its Bulk Actives business and in the next year it acquired American Remedies Limited, a pharmaceutical company based in India. In the year 1993 the company established Dr. Reddy's Research Foundation and started its Drug Discovery program. The company has membership in WTO since April 1994 and in the same year 1994 the company Makes a GDR issue of USD 48 million.
The Company's Custom Pharmaceutical Services (CPS) business was formed in the year 2001, and in 2002 conducts its first overseas acquisition - BMS Laboratories Limited and Meridian Healthcare in UK, the company received ASIASTAR Award for Packaging Excellence 2002 for Mintop Forte - Customer Convenience Pack by Asian Packaging Federation in the year. Announced a 15-year exclusive product development and marketing agreement for OTC drugs with Leiner Health Products in the US by the company in the year 2003 and launched Ibuprofen, first generic product to be marketed under the "Dr. Reddy's" label in the US and it conferred WORLDSTAR Award for Packaging Excellence 2003 For Omez capsules pack with Anti-Counterfeiting Features. The acquisition of Trigenesis gives the company to access drug delivery technology platforms in the year 2004. Dr. Reddy's Lab increased focus point in CPS business after the acquisition of Roche's API manufacturing unit, Mexico in the year 2005 and in the same year the company acquired Roche's API Business at the state-of-the-art manufacturing site in Mexico with a total investment of USD 59 million. Announced the formation of Perlecan Pharma: India's First Integrated Drug Development Company and again announced India's first major co-development and commercialization deal for it's molecule Balaglitazone (DRF 2593), with Rheoscience. It made unique partnership for the commercialization of ANDAs with ICICI Venture, the Best Management Award 2005 by Labour Department, Govt. of Andhra Pradesh, India came to the company. In the year 2006 the company acquired Betapharm- the fourth-largest generics company in Germany for a total enterprise value of ? 480 million and received Finance Asia Achievement Awards 2006 for Best India Deal - acquisition of Betapharm. Dr. Reddy's Lab becomes No.1 pharmaceutical company in India in turnover and profitability as on 2007.
The appreciation and recognition is a role to boost, as part the company has received plenty of awards and applications already, continued that, the company got Pharma Excellence Awards 2006-07 under the category of Sustained Growth by The Indian Express, Dun & Bradstreet American Express in Corporate Awards 2007, Best Corporate Social Responsibility Initiative 2007 by BSE - India and Amity Leadership Award for Best Practices in HR in Pharmaceutical Sector. 4th HR Summit '08.
Dr Reddy's Laboratories has entered into a settlement agreement with Novartis Pharma AG on January 2008, which involves a stipulation of dismissal of the lawsuits in the United States relating to the Abbreviated New Drug Applications filed by the company for a generic version of rivastigmine tartrate capsules sold under the trade-name Exelon and in same month and year the company has launched Supanac (Diclofenac potassium immediate release 50 mg tablets) in India, increasing its offering in the Rs 2700 crores in NSAID market. Supanac is in-licensed from Applied Pharma Research (APR), Switzerland and is used for Acute Pain management. On February, 2008 the company has entered into an agreement with SkyePharma PLC to undertake a feasibility study of a product utilizing two of SkyePharma's proprietary drug delivery systems. Dr. Reddy's Laboratories announced that it has entered into a definitive agreement with The Dow Chemical Company to acquire a portion of Dowpharma Small Molecules business associated with its United Kingdom sites in Mirfield and Cambridge on 1st April 2008. In the same month of same year Dr.Reddy's Lab and 7TM Pharma has announced the signing of drug discovery collaboration on selected drug targets in the area of metabolic disorders. Under the terms of the agreement, Dr. Reddy's and 7TM Pharma will collaborate to identify clinical candidates for pre-selected targets. Both the parties will jointly develop these candidates from the pre-clinical stage up to Phase IIa (proof-of-concept). As on April 2008, the company has acquired Jet Generici Srl, a company engaged in the sale of generic finished dosages in Italy. The deal has been completed via Dr Reddy's Italian subsidiary.
To help people lead healthier lives by delivering affordable and accessible medication to all parts of the world and discovering, developing and commercializing innovative medicines that satisfy unmet medical needs are the two parallel objectives of Dr. Reddy's Laboratories Limited, and it is sustain path of the company to survive.
Company Background - SAIL
Incorporated in 1973, the Steel Authority of India (SAIL) is a giant among the steel majors in India. It is the largest steel conglomerate in the country and the world's ninth-largest steelmaker. It manages and operates five integrated steel plants at Bhilai, Madhya Pradesh; Bokaro, Bihar; Durgapur, West Bengal; Rourkela, Orissa; and Burnpur, West Bengal. It also has four units for special and alloy steels and ferro alloys at Durgapur, West Bengal; Salem, Tamilnadu; Chandrapur, Maharashtra; and Bhadravati, Karnataka.
SAIL operates nine iron ore, five limestone, three dolomite and three coal mines besides generating 700 MW of captive power. The Central Marketing Organisation, with its headquaters at Calcutta, monitors its domestic market through an expanding network of stockyards, dockyards, branch sales offices and consignment agents while the International Trade Division looks after its export of world-class steel to as many as 70 countries across the globe, by establishing close liaison with buyers abroad.
The company is the only producer of extra-wide (up to 3200 mm) and heavy plates, catering to the needs of the construction, automobile, shipbuilding, engineering and other sectors.
The subsidiaries of SAIL are The Indian Iron & Steel Company Ltd and Maharashtra Elektrosmelt Ltd. Bhilai Oxygen Ltd, which was one of the subsidiary company was wound-up by the order of dated 27th May 2005 of Hon'ble High Court of Delhi.
SAIL's plants and units have received ISO 9002/1 certifications and are well-equipped with the state-of-the-art technology to meet advanced needs and applications. ISO 9002-certified stainless steel is exported to several developed countries.
The Govt of India has approved the Financial and Business Restructuring of SAIL involving waiving of loans advanced to it from Steel Dvpt Fund to a value of Rs.5073 cr and Rs.381 cr from Govt of India; Provision of Govt guarantees with 50% interest subsidy for loan and interest thereon on Rs.1500 cr to be raised by SAIL from the market to finance reduction in manpower through voluntary retirement scheme; Provision of Govt guarantee for loan and interest thereon of Rs.1500 cr (incl.Rs.500 cr already agreed) to be raised by SAIL from the market primarily for meeting repayment obligation on past loans during 1999-2000. To initiate the process of divestment of the following non-core assets into a joint venture with protecting jobs of the existing employees SAIL has decided to sell, lease or dispose of by way of divesting the following undertakings of the company either through joint venture arrangement or otherwise. Captive Power Plants at Rourkela, Durgapur and Bokaro; Oxygen Plant-2 of Bhilai Steel Plant; Salem Steel Plant, Salem; Alloy Steels Plant, Durgapur; Visvesvaraya Iron and Steel Plant, Bhadravati; Rourkela Fertilizer Plant, Rourkela.
For Salem Steel Plant of SAIL the Company has sought expression of interest from interested parties for setting up of stainless steel melting,refining and casting facilities and also option for interest in Salem Steel Plant itself along with the above facilities.
The company has signed a joint venture agreement with Tata Iron & Steel and Kalyani Steel for the creation of a company to manage their steel e-marketplace, metaljunction.com.
The company tied-up with the National Building Construction Corporation (NBCC) for formation ofa consortium to help reconstruction activity in quake-hit Gujarat. The combine will initially concentrate on building low-cost, quake-hit and cyclone-resistant dwelling units suitable for rural Gujarat.
The company has completed the Modernisation Programme at Bhilai Steel Plant and also the Upgradation of Durgapur Steel Plant has also been completed during 2001-02. At Bokaro Steel Plant the equipment work is in progress and the Furnace was commissioned in 2002-03. The company incurred a capital expenditure of Rs.241 crores. The Company has entered into an agreement with Corus Consulting Ltd UK for Long Rail facility and the UK company will provide a technical back up support for SAIL.
During 2004-05 the company projects worth Rs.3000 crore at various stages of implementation and approval in the company. Some of the major ongoing schemes are Rebuilding of Coke Oven Battery-5, Upgradation of Blast Furnace-7 and Revamping of B-Strand of Wire Rod Mill at Bhilai Steel Plant: Bloom Caster with Associated facilities at Durgapur Steel Plant: Rebuilding of Coke Oven Battery-1, Capital Repair of BF-4 and Upgradation of ERW Pipe Plant at Rourkela Steel Plant: Rebuilding of Coke Oven Battery-5, Revamping/modification of Mae West Block System and housing machining in Finishing Stands F6-F12 at Bokaro Steel Plant. Some of the projects under approval are Upgradation of Slab Caster, RH Degassing and Ladle Furnace, Modernisation of Sinter Plant-II & Desulphurisation Unit in SMS-II at Bhilai Steel Plant: Coal Dust Injection in Blast Furnace(3&4) at Durgapur Steel Plant: Installation of Hot Metal Desulphurisation Unit at SMS-II at Rourkela Steel Plant: Upgradation of Tandem Mill & Pickling Line in cold Rolling Mill (CRM) and Installation of Coal Dust Injection in Blast Furnace (2 & 3).
Bharti vs Reliance Communications
“All determinate situations can be turned to advantage,” explains classical Chinese warrior philosopher Tsun Tzu in his ancient book “The Art of War”. R-ADAG chairman Anil Ambani, a self-avowed practitioner of Tsun Zu’s war strategy has taken a leaf out of the ancient Chinese classic in the MTN saga.
Two days after Bharti announced that its negotiations with MTN had failed, Mr Ambani’s Reliance Communications (RCOM) on Monday said that it had entered into exclusive talks with South African mobile firm to discuss a “potential combination of their businesses” to “achieve unique global platform for exponential growth”.
Whether RCOM entered into negotiations with MTN once talks with Bharti had failed or whether it was its eagerness to explore all options with MTN which resulted in the South African company refusing to budge from its position that Bharti Airtel become a subsidiary, thereby resulting in the collapse of talks between the two is a matter of conjecture.
But one thing is clear. The battle between the India’s two largest private mobile operators has spread from the corridors of Sanchar Bhawan to the domestic market place to foreign shores as well.
If RCOM were to pull off a merger with MTN, it would create a global telecom giant with close to 120 million subscribers that has a footprint stretching from the Cape of Good Hope to the Himalayas across 23 countries and covering a population of two billion, a third of the world. Besides, an RCOM-MTN combine will have the largest WiMAX footprint globally covering 50% of the world’s population.
The combine will also command a market cap of over $65 billion, have revenues to the tune of $14.4 billion, an operating profit of over $6 billion and assets worth $26.8 billion, and emerge as he second most profitable operator in emerging markets after China Mobile. This will more than drawf Bharti which currently has a market cap of a little over $40 billion with 65 million subscribers with no significant presence outside India.
Round One won by RCOM
The RCOM Vs Bharti battle is nearly a decade old — while Mittal was earlier pitted against the older Ambani (Mukesh) for the last three years, he has been fighting the younger brother Anil Ambani on the telecom front. While Bharti Airtel is currently miles ahead of over all its rivals, including RCOM in India, the tables had turned only two years ago.
In 2005, RCOM (then called Reliance Infocomm) not only managed to dislodge Bharti from its market leadership position, but nearly pushed Mr Mittal to the edge. So much so that even Mr Mittal admitted that at the height of the WLL crisis in 2002, Battleship Bharti was a “machine that was creaking”.
Infocomm’s entry forced Mr Mittal to invest beyond his company’s means, and the policy googly from the government, which allowed players such as Reliance which held limited mobility (WLL) licenses to offer full-fledged mobile telephony left Bharti a tad vulnerable, both financially and strategically. The pace of Infocomm’s national rollout, coupled with cheaper tariffs and handsets saw the company shot past Bharti in subscriber numbers.
Round Two went to Bharti
Trade analysts predicted that Bharti would fold up as it could not match Infocomm in either subscriber numbers or tariffs. Instead, Bharti recorded its first quarterly profit of Rs 23 crore in March 2003 and its first full year profit in FY04. Bharti reduced tariffs gradually, harped on the superior quality of services, roped in SingTel as an investor, and launched its now famous outsourcing model. Network management went to Nokia Siemens and Ericsson, IT to IBM and call customer related activities were outsourced to global BPO majors.
Infocomm, on the other hand, was plagued by glitches in its first 24 months of operations. From wide-spread billing problems leading to customer dissatisfaction, to trouble with the law for illegal routing of international calls and a down market image, Infocomm’s first two years were mired by problems of various hues, which played into Bharti’s hands.
And so, after being behind in the race for subscriber numbers for nearly three years, Bharti drew level to Reliance. The figures explain better: In Q3, FY 06, Bharti had 16.3 million against Reliance’s 17 million; and in Q4 of FY 06, Bharti had 19.6 million against Reliance’s 20.2 million. However, in Q1, FY 07, Bharti raced to the lead with 23.1 million wireless users compared to Reliance’s 22.5 million base. Since then Bharti has pulled ahead month-after-month to command a towering lead — it currently has a subscriber base of about 65 million which is 17 million ahead of Reliance Communication’s CDMA and GSM arms combined.
RCOM comes back fighting
But Reliance Communications under Mr Anil Ambani, with a change in management and a new brand identity quickly sorted out all problems that plaugedthe company and quickly re-emerged as the primary competitor to Bharti. Lsat year, RCOM could have emerged as the largest operator in India if it was successful in its bid for Hutchison-Essar.
If the company had bagged Hutch in February 2007, the CDMA major would have had over 50 million subscribers and close to a 40% market share, way ahead of Bharti with 30 million subscribers . Mr Mittal played his part in providing the no objection certificate to Vodafone, which enabled the UK-based telco to outbid RCOM and gain a controlling stake in Hutchison Essar.
Mr Ambani and RCOM hit back hard again late last year. Catching the GSM industry off guard, the Department of Telecom approved the use of dual technology where telcos can offer both GSM and CDMA services under the same license. Even before the policy became public, RCOM got the DoT nod to offer GSM services based on its applications it had filed in GSM license in February 2006.
GSM operators led by Bharti went all out to defend their turf — they filed a series of applications with the telecom tribunal and the Delhi High Court accusing the DoT of “twisting rules to benefit one operator”, and said that RCOM’s applications for GSM were invalid. But their lobbying and legal challenges failed to yield the desired results.
At the same time, Mr Ambani also opened up a new front — he accused GSM players of trying to hoard spectrum and limit new competition, in addition to resorting to anti-consumer practices, such as cartelisation and price fixation. Even as GSM operators were engaged in proving that they were entitled to spectrum 6.2 MHz, the impasse allowed Mr Ambani to open a third front in the battle for airwaves.
RCOM along with Tatas campaigned for enforcing a Telecom Engineering Centre’s recommendations which said that GSM players should increase their subscriber base between 6 - 15 time before they are given additional spectrum. All of Mr Mittal’s efforts to get the DoT to rollback the stringent spectrum allocation norms came to naught.
While Bharti and other GSM players were fighting numerous court battles through their industry association, RCOM on the other hand used this break to plan its GSM roll-out. RCOM emerged victorious with a pan-India GSM licence and start-up GSM spectrum.
via Economic Times
Gold trades sideways, oil still providing support
Thin trading on Memorial Day holiday in global markets
Gold futures traded in a sideways manner today as the global markets struggled to find direction amid thin trading on the Memorial Day holiday. The COMEX Gold futures added about one dollar in the early Asian trades but failed to show any signs of a major breakout.
Gold propped up in the early London trades following an up move in the crude oil futures. Crude oil gained sharply today, reacting swiftly to the news that Russian government has hiked oil export duty to $398.1 starting June 1, making a further dent in the potential global oil supplies.
The NYMEX Crude oil futures for July hit a high of $133.27 per barrel as the tight dynamics of the oil market fundamentals propped up very god buying support even as the other asset classes failed to show much of a deviation of account of Memorial Day holiday.
In the economic news today, European Central Bank Vice President Lucas Papademos said that high oil prices have hit economic growth in the 15 nation Euro zone while at the same time contributing to inflationary pressures inside the Euro zone.
Since June 2007, the ECB has kept the interest rates unchanged at 4%, as the very basic mandate of price stability, something that the ECB inherited from the Bundesbank -.its role model right from the start. This has send the single European currency soaring against its US counterpart, pushing up the dollar denominated commodity assets prices to stratosphere.
The Euro currently trades at 1.5780 against the US dollar and a tight movement can be witnessed in the global currency markets today. This is likely to spell a similar scenario for Gold and it is unlikely that the commodity would gather any further buying support.
MCX Gold trades at Rs 12758, up Rs 24 per 10 grams for the June futures, rebounding from a low of Rs 12710. The open interest is up 1.12% at 2907 lots.
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