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Monday, June 02, 2008
Rupee falls on market fall
Ends at 42.40/41 per dollar
Indian rupee was knocked off early highs on Monday as the sharemarket tumbled on worries of a rift in the ruling coalition, raising concerns about foreigners selling investments and repatriating their holdings.
Rupee ended at 42.40/41 per dollar as against Friday's close of 42.45/46.
Nifty June futures at steep discount
Reliance Industries June 2008 futures most active
Nifty June 2008 futures were at 4696, a sharp discount of 43.60 points as compared to spot closing of 4739.60.
The NSE futures & options (F&O) segment turnover was Rs 35,257.77 crore, which was slightly lower than Rs 35,883.79 crore on Friday, 30 May 2008.
Reliance Industries (RIL) June 2008 futures were at discount at 2343 compared to the spot closing of 2358.80.
Reliance Petroleum (RPL) June 2008 futures were at discount at 170.95 compared to the spot closing of 172.50.
Reliance Capital (RCL) June 2008 futures were at discount at 1122.20 compared to the spot closing of 1135.15.
In the cash market, the S&P CNX Nifty lost 130.50 points or 2.68% at 4739.60.
Market ends deep in red
The Bombay Stock Exchange benchmark Sensex pared early gains and lost over 352 points at close as fears of a hike in retail fuel prices triggered aggressive selling in stocks, mainly in refinery and metal segments.
The 30-share Sensex on BSE, which gained nearly 217 points in opening session, fell back sharply to close 352.39 points lower at 16,063.18.
The BSE barometer even dipped below 16,000 points level at 15,991.21 as market players turned active sellers.
Similarly, the wide-based National Stock Exchange index Nifty dropped by 130.50 points at 4,739.60. It touched the day's high of 4,908.50 points. The Nifty touched the day's high of 4,908.80 and a low of 4,713.00 points.
Marketmen said selling pressure emerged on reports of the government planning to hike petrol and diesel prices in line with the rising crude oil prices in the global markets.
Earlier in the day, Prime Minister Manmohan Singh called for wider political consensus on fuel price hike. However, a source said there was no unanimity in thinking within the government and that a decision on the issue may not be taken before wednesday.
Metal segment suffered the most as metal index plunged 619.37 points at 16,295.26, followed by capital goods index by 341.89 points at 12,808.75.
Realty index dropped by 280.53 points at 6,728.13, PSU index by 271.83 points at 6,807.83 and bank index by 260.26 points at 7,454.33.
Refinery stocks led by Reliance Industries dropped sharply by 190.14 points at 10,206.71, power index by 107.50 points at 2,828.74, IT index by 63.44 points at 4,350.42, teck index by 53.63 points at 3,561.57 and healthcare index by 45.57 points at 4,350.42.
However, auto index managed to hold a moderate gain of 2.45 points at 4,358.21.
NSE Bulk Deals to Watch - June 2 2008
Date,Symbol,Security Name,Client Name,Buy/Sell,Quantity Traded,Trade Price / Wght. Avg. Price,Remarks
02-JUN-2008,BRABOURNE,Brabourne Enterprises Ltd,MULTI EXCHANGE TRADERS,BUY,73003,26.61,-
02-JUN-2008,BRABOURNE,Brabourne Enterprises Ltd,THE SURAT SAFE DEPOSIT VAULT PVT LTD,BUY,171388,26.88,-
02-JUN-2008,ERAINFRA,Era Infra Engineering Ltd,ELOQUENT TRADELINKS PRIVATE LIMITED,BUY,140000,587.39,-
02-JUN-2008,ERAINFRA,Era Infra Engineering Ltd,PROMISING TRADELINKS PRIVATE LIMITED,BUY,140000,587.14,-
02-JUN-2008,GSSAMERICA,GSS America Infotech Limi,ASTUTE COMMODITIES & DERIVATIVES Pvt Ltd,BUY,61713,388.32,-
02-JUN-2008,GSSAMERICA,GSS America Infotech Limi,DINESH MUNJAL,BUY,96403,389.07,-
02-JUN-2008,GSSAMERICA,GSS America Infotech Limi,FIN BRAINS SECURITIES (INDIA) LTD.,BUY,225707,389.84,-
02-JUN-2008,GSSAMERICA,GSS America Infotech Limi,GOLDMAN SACHS INVESTMENTS MAURITIUS I LTD,BUY,67750,387.14,-
02-JUN-2008,GSSAMERICA,GSS America Infotech Limi,MANSUKH SECURITIES & FINANCE LTD,BUY,107580,386.51,-
02-JUN-2008,GSSAMERICA,GSS America Infotech Limi,MBL & COMPANY LTD.,BUY,75062,384.45,-
02-JUN-2008,KHAITANELE,Khaitan Electricals Ltd,THE SURAT SAFE DEPOSIT VAULT PVT LTD,BUY,142538,60.19,-
02-JUN-2008,KOHINOOR,Kohinoor Foods Limited,KAMINI FINANCE AND INVESTMENT,BUY,284719,81.14,-
02-JUN-2008,XLTL,XL Telecom Limited,KMRINDUSTRIESLIMITED,BUY,49943,260.82,-
02-JUN-2008,XLTL,XL Telecom Limited,TARRA FUND,BUY,100000,261.00,-
02-JUN-2008,BRABOURNE,Brabourne Enterprises Ltd,MULTI EXCHANGE TRADERS,SELL,73003,26.81,-
02-JUN-2008,BRABOURNE,Brabourne Enterprises Ltd,THE SURAT SAFE DEPOSIT VAULT PVT LTD,SELL,145461,26.62,-
02-JUN-2008,ERAINFRA,Era Infra Engineering Ltd,ELOQUENT TRADELINKS PRIVATE LIMITED,SELL,140000,587.14,-
02-JUN-2008,ERAINFRA,Era Infra Engineering Ltd,PROMISING TRADELINKS PRIVATE LIMITED,SELL,140000,587.39,-
02-JUN-2008,GSSAMERICA,GSS America Infotech Limi,ASTUTE COMMODITIES & DERIVATIVES Pvt Ltd,SELL,71538,388.50,-
02-JUN-2008,GSSAMERICA,GSS America Infotech Limi,DINESH MUNJAL,SELL,96403,389.33,-
02-JUN-2008,GSSAMERICA,GSS America Infotech Limi,FIN BRAINS SECURITIES (INDIA) LTD.,SELL,225407,390.51,-
02-JUN-2008,GSSAMERICA,GSS America Infotech Limi,MANSUKH SECURITIES & FINANCE LTD,SELL,107580,387.85,-
02-JUN-2008,GSSAMERICA,GSS America Infotech Limi,MBL & COMPANY LTD.,SELL,74562,388.46,-
02-JUN-2008,KHAITANELE,Khaitan Electricals Ltd,THE SURAT SAFE DEPOSIT VAULT PVT LTD,SELL,108421,60.02,-
02-JUN-2008,KOHINOOR,Kohinoor Foods Limited,SUDHIR JAIN,SELL,160000,81.04,-
02-JUN-2008,XLTL,XL Telecom Limited,KMRINDUSTRIESLIMITED,SELL,100679,261.00,-
BSE Bulk Deals to Watch - June 2 2008
Deal Date Scrip Code Scrip Name Client Name Deal Type * Quantity Price **
2/6/2008 523269 ADVANI HOT R AAYUSH KABRA B 300000 99.50
2/6/2008 523269 ADVANI HOT R KAMAL KABRA S 300000 99.50
2/6/2008 532975 AISHWARYA TE N D NISSAR B 108225 88.60
2/6/2008 532975 AISHWARYA TE N D NISSAR S 108225 88.63
2/6/2008 531223 ANJANI SYNTH TEJASH JAYANTILAL SHAH B 80000 44.35
2/6/2008 531223 ANJANI SYNTH BHAVANA N. MAHIDA S 80000 44.35
2/6/2008 506874 ASKME IN HU ARVIND SINGHVI B 35000 1.40
2/6/2008 590059 BIHAR TUBES SECUROCROP SECURITIES INDIA P S 43100 179.35
2/6/2008 590061 BRUSHMAN IND PACIFIC CORPORATE SERVICES LTD B 80000 115.00
2/6/2008 531137 GEMSTONE INV HEMANT MADHUSUDAN SHETH B 25000 21.45
2/6/2008 531137 GEMSTONE INV BHAVESH PRAKASH PABARI B 50250 21.41
2/6/2008 531137 GEMSTONE INV MALA HEMANT SHETH S 75000 21.42
2/6/2008 532439 GOLDST INFRA MALA HEMANT SHETH B 199000 72.06
2/6/2008 532439 GOLDST INFRA HEMANT MADHUSUDAN SHETH S 199000 72.06
2/6/2008 532951 GSS AMERICA MANSUKH STOCK BROKERS LTD B 75535 390.81
2/6/2008 532951 GSS AMERICA SAM GLOBAL SECURITIES LTD. B 86038 387.84
2/6/2008 532951 GSS AMERICA H.J.SECURITIES PVT.LTD. B 81731 401.49
2/6/2008 532951 GSS AMERICA MANSUKH STOCK BROKERS LTD S 75535 389.75
2/6/2008 532951 GSS AMERICA SAM GLOBAL SECURITIES LTD S 86038 387.27
2/6/2008 532951 GSS AMERICA H.J.SECURITIES PVT.LTD. S 81731 401.78
2/6/2008 504176 HIGH ENERGY HEMANT H SHROFF HUF B 4900 175.33
2/6/2008 531129 INAN MARB IN JIGNESH SHAH B 39550 41.76
2/6/2008 531129 INAN MARB IN MAHENDRA D AYER S 16827 41.80
2/6/2008 512559 KOHINORFOODS KAMINI FINANCE AND INVESTMENT B 211115 81.29
2/6/2008 532884 REFEX REFRIG DEEPIKA SHARAD NANSI B 90000 224.04
2/6/2008 532884 REFEX REFRIG HEMANT MADHUSUDAN SHETH S 80000 224.60
2/6/2008 532884 REFEX REFRIG HIMAT PARSHOTTAMBHAI JATANIA S 370000 225.00
2/6/2008 521206 SAMTEX FASHI KINSFOLK INDUSTRIES PVT LTD B 43915 16.77
2/6/2008 521206 SAMTEX FASHI MUVIN INFOTECH LTD S 43915 16.77
2/6/2008 504375 SOFTBPO GLOB CHETAN BHUPATRAI MEHTA S 750 372.09
2/6/2008 504375 SOFTBPO GLOB LALCHAND SURJI GADA S 850 364.46
2/6/2008 532669 SOUTHBIOTEC MAVI INVESTMENT FUND LTD B 260000 30.62
2/6/2008 513530 STELCO STRIP SPJSTOCK B 88918 41.76
2/6/2008 513530 STELCO STRIP SPJSTOCK S 88918 43.13
Post Market Commentary - June 2 2008
Indian market slipped sharply to close with heavy losses after giving up all its initial profits due to weak opening of the European markets that led the investors to book profits across the board. On the back of mixed cues from global market, the domestic market opened on the positive note. Further, it lost its momentum and was trading in the red. The investors did not showed their active participation during the trading session, due to rising concerns of a fuel price hike. According to prime minister, government is left with no option but to hike the price of fuel due to soaring price of crude oil in the global market. This statement is indicating imminent increase in fuel prices. Investors take cautious approach to book their position and pushed the market to close in deep red. From the sectoral front, the metal and capital goods stocks were not in favour. Realty, banking and oil & gas stocks also contributed in increasing the pressure. The market breadth was negative as 2066 stocks closed in red while 600 stocks closed in green 50 stocks remained unchanged.
The BSE Sensex closed lower by 352.39 points at 16,063.18 and NSE Nifty fell by 130.90 points to close at 4,739.60. The BSE Mid Caps and Small Cap closed lower by 176.35 points and 173.53 points at 6,584.19 and 8,959.51 respectively. The BSE Sensex touched intraday high 16,632.72of and intraday low of 15,991.21.
Losers from the BSE are NTPC Ltd (6.39%), ACC Ltd (5.23%), Hincalco (5.05%), Reliance Infra (4.90%), TCS Ltd (4.33%), BHEL (4.00%), Tata Steel (3.86%), HDFC Bank (3.78%) and Reliance Com Ltd (3.78%).
The Metal Index closed lower by 619.37 points at 16,295.26 Losers are Sesa Goa Ltd (7.94%), Sh Precoated (5.34%), Jindal Steel (5.15%), Hindalco (5.05%), Ispat Industries (4.46%), Hindustan Zinc(3.89%) and Tata Steel (3.86%).
The Capital Goods index declined by 341.89 points to close at 12,808.75. Major losers are Punj Llloyd (10.53%), Alstom Proj (5.29%), Elecon Eng (4.87%), Aiaengineer (4.65%), Kir Oil Eng (4.32%) and BHEL (4.00%).
The Realty index closed lower by 280.53 points at 6,728.13 Losers are Housing Development (6.78%), Purvankara (6.54%), Unitech Ltd (6.47%), Mahindra Life (5.93%), Sobha Dev (5.76%), and Ansal Infra (5.36%).
The Banking index fell by 260.26 points to close at 7,454.33 as Kotak Bank (6.44%), Axis Bank (5.55%), Yes Bank (4.79%), Karnataka Bank (4.65%), HDFC Bank (3.78%), and Bank of Baroda (3.76%) closed in negative territory.
The Oil & Gas index closed lower by 190.14 points at 10,206.71. Losers are Gail India (4.51%), Cairn India (4.46%), Aban Offshore (4.34%), ONGC (3.61%), Reliance Nat Resources (3.50%) and BPCL (2.47%).
Sensex drops 352 points
The market received a severe jolt in the last hour of the trading session, as panic selling across the board saw the Sensex shed 352 points and plunged below the 16,000 mark. The Sensex began the day on a positive note at 16,591, 175 points above its last close and maintained a mixed trend during the major part of the session on lack of buying interest. The market began to crumble towards the close and gradually came under sharp hammering on sustained selling pressure in heavyweight, reality, public sector undertaking (PSU), metal, power and bankex stocks and slipped below 16,000. The Sensex ended the session with losses of 352 points at 16,063, while Nifty shed 131 points and closed at 4,740.
The market breadth was negative. Of the 2,716 stocks traded on the BSE, 2,066 stocks declined, 600 stocks advanced and 50 stocks ended unchanged. Barring the BSE Auto index, all other sectoral indices slipped from higher levels and ended in negative territory. The BSE Realty index was the major loser and dropped 4% at 6,728 followed by the BSE PSU index (down 3.84% at 6,808), the BSE Metal index (down 3.66% at 16,295) and the BSE Power index (down 3.66% at 2,829).
Among the major losers, NTPC dropped 6.39% at Rs161.25, ACC crumbled 5.23% at Rs626.10, Hindalco declined 5.05% at Rs182.25, Reliance Infra slipped 4.90% at Rs1,170.40, TCS tumbled 4.33% at Rs984.65, BHEL shed 4% at Rs1,595.65 and Tata Steel lost 3.86% at Rs868.05. HDFC Bank, Reliance Communications, ONGC, SBI, DLF, Ambuja Cement, ICICI Bank, Ranbaxy Laboratories, Wipro, Tata Motors, Larsen & Toubro, Cipla and Reliance Industries were down over 1-3% each. However, Maruti rose 2.85% at Rs786.30, ITC added 1.01% at Rs219.85, Mahindra & Mahindra gained 0.18%at Rs593.55 and Bharti Airtel advanced 0.14% at Rs877.70.
Over 1.84 crore IFCI shares changed hands on the BSE followed by Ispat Industries (1.60 crore shares), Spice Tele (1.17 crore shares), Chambal Fertiliser(1.14 crore shares) and Reliance Natural Resources (94.69 lakh shares).
Valuewise, Essar Oil registered a turnover of Rs183 crore on the BSE followed by Reliance Capital (Rs180 crore), Reliance Industries (Rs173 crore), GSS America (Rs142 crore) and Reliance Petroleum (Rs142 crore).
Definition - Bear Market
A prolonged period in which investment prices fall, accompanied by widespread pessimism. If the period of falling stock prices is short and immediately follows a period of rising stock prices, it is instead called a correction. Bear markets usually occur when the economy is in a recession and unemployment is high, or when inflation is rising quickly. The most famous bear market in U.S. history was the Great Depression of the 1930s. The term "bear" has been used in a financial context since at least the early 18th century. While its origins are unclear, the term may have originated from traders who sold bear skins with the expectations that prices would fall in the future. opposite of bull market.
Fears of early election rattles bourses
Mounting political concern was the key culprit that haunted bourses since second half of day's trading session, wiping-off steady early gains. A late sell-off resulted in the benchmark index BSE Sensex cracking below the physcological 16,000 mark, only to close slightly above that level. However the S&P CNX Nifty shut shop below 4,750 level. The market breadth was weak. Asian markets, which opened before Indian markets were firm.
The market which was firm till early afternoon trade, witnessed a sharp sell-off thereafter triggered by reports that the Revolutionary Socialist Party (RSP), a member of the Left Front led by the Communist Party of India-Marxist (CPM) was pulling out of the United Progressive Alliance (UPA)-Left coordination committee. Wary investors pressed sales over uncertainty that Left parties may withdraw support to the government.
Weak European markets, slower manufacturing growth and widening trade deficit, were the other demons that haunted the markets. Shares from realty, metal and banking were axed brutally. However auto stocks held firm throughout the day.
The 30-share BSE Sensex eroded a sharp 352.39 points or 2.15% to 16,063.18. The index climbed 217.15 points at day’s high of 16,632.72, hit at the onset of trading session. Sensex lost 424.36 points at day’s low of 15991.21.
The broader based S&P CNX Nifty declined 130.5 points or 2.68% to shut shop at 4,739.60. Nifty has struck an intra-day high of 4,908.80 in opening trade. Nifty June 2008 futures were at 4696, a sharp discount of 43.60 points as compared to spot closing of 4739.60.
The market breadth was weak on BSE with 600 shares advancing as compared to 2066 stocks that declined. 50 stocks remained unchanged.
The BSE Mid-Cap index declined 2.61% to 6,584.19 and BSE Small-Cap index down 2.13% to 7,959.51.
Among the sectoral indices on BSE, the BSE Realty index (down 4% at 6,728.13), BSE PSU index (down 3.84% to 6,087.83), BSE Metal index (down 3.66% to 16,295.26), BSE Power (down 3.66% to 2,828.74), BSE Bankex (down 3.37% at 7,454.33), BSE Consumer Durables index (up 2.94% to 4,193.75), underperformed Sensex.
However the BSE Auto index (up 0.06% at 4,358.21), BSE FMCG index (down 0.67% at 2,411.48), BSE Health Care index (down 1.04% at 4,350.42), BSE IT index (down 1.37% to 4,580.35), BSE TecK index (down 1.48% to 3,561.57), BSE Oil & Gas index (down 1.83% to 10,206.71) BSE Capital Goods index (down 2.6% at 12,808.75) outperformed Sensex.
BSE clocked a turnover of Rs 4,779 crore today compared to a turnover of Rs 5514.14 crore on 30 May 2008.
The NSE futures & options (F&O) segment turnover was Rs 35,257.77 crore, which was slightly lower than Rs 35,883.79 crore on Friday, 30 May 2008.
Prime Minister Manmohan Singh reportedly said that the government is left with no option but to hike the fuel prices in the wake of soaring global crude oil prices. However government's move to hike fuel price will face challenge from Left, and may propel inflation above 10%.
On the other hand, if government does not hike prices, oil marketing companies will go bankrupt, spoiling its report card.
As per petroleum minister's proposal, a hike of Rs 10 a litre in petrol prices, Rs 5 per litre in diesel and Rs 50 per cylinder in cooking fuel is to be considered to cut losses being incurred by the state-run firms. But the Left parties had said they would oppose any move to hike prices of transport and cooking fuels since the average citizen was already burdened by high inflation.
Indian manufacturing activity slowed a fraction in May 2008 to its lowest in 10 months, although output and new export orders rose, but input and factory gate prices increased, a survey showed. The ABN AMRO Bank purchasing managers' index (PMI) was a seasonally adjusted 57.4 in May 2008 after 57.5 in April 2008, significantly below its December 2007 reading of 61.9 which was the highest in the survey's three-year history.
Meanwhile, trade deficit widened to $9.87 billion in April 2008 as against $6.81 billion in April 2007. Exports grew to $14.4 billion in April 2008-09, against $10.95 billion a year ago.
India’s largest private sector firm by market capitalisation and oil refiner Reliance Industries declined 1.91% to Rs 2,355.70. It came off from its high of Rs 2437.
Interest rate sensitives, realty and banking sectors suffered sharp cut in today's trade. Indiabulls real Estate (down 1.86% to Rs 472.20), Unitech (down 6.47% to Rs 217.45) and DLF (down 3.37% to Rs 567.65) edged lower from real estate sector.
Banking stocks declined on fears of further surge in inflation post fuel price hike. HDFC Bank (down 3.78% to Rs 1,306.55), ICICI Bank (down 2.97% to Rs 764.85) and State Bank of India (down 3.41% to Rs 1,394.10) edged lower.
Metal stocks declined after the Centre withdrew duty drawback benefits on all iron & steel shipments. The move was aimed at discouraging exports in the face of domestic inflationary pressures. Tata Steel (down 3.86% to Rs 868.05), National Aluminium Company (down 5.11% to Rs 506.60) and Hindalco Industries (down 5.05% to Rs 182.25), Steel Authority of India (down 3.54% to Rs 154) edged lower.
Power stocks declined on profit booing. Reliance Infrastructure (down 4.9% to Rs 1,170.40), NTPC (down 6.39% to Rs 161.25), Power Grid Corporation of India (down 4.11% to Rs 94.45), Reliance Power (down 3.07% to Rs 228.60) and Tata Power Company (down 4.77% to Rs 1,292) declined.
However auto stocks held gains after posting rise in May 2008 monthly sales. Bajaj Auto rose 0.27% to Rs 576 after posting 7.57% rise in motorcycle sales to 179,649 units in May 2008 over May 2007.The sale of total two wheelers rose 6.86% to 180,935 units, in May 2008 over May 2007. The total two and three wheeler sale rose by 4.17% to 201,511 units in May 2008 over May 2007.
India’s largest motorcycle maker by sales Hero Honda Motors rose 5.6% to Rs 788.55. It reported a 9.54 % rise in its motorcycle sales in May 2008 at 3,12,317 units as compared with 2,85,109 units in May 2007.
India’s largest car maker by sales Maruti Suzuki India rose 2.94% to Rs 787. The company’s total vehilcle sales rose 16% to 69,001 units in May 2008 over May 2007. Mahindra & Mahindra (up 0.76% to Rs 597.05) edged higher. However Tata Motors declined 0.85% to Rs 572.
ITC (up 1.01% to Rs 219.85) and Bharti Airtel (up 0.14% to Rs 877.70) edged higher.
ACC (down 5.23% to Rs 626.10), Bharat Heavy Electricals (down4% to Rs 1595.65), Reliance Communications (down 3.78% to Rs 555.35), Ambuja Cements (down 3.1% to Rs 92.25), Ranbaxy Laboratories (down 2.76% to Rs 514.05), Wipro (down 2.51% to Rs 495.25 edged lower.
IFCI clocked the highest volume of 1.84 crore shares on BSE. Ispat Industries (1.6 crore shares), Spice Communications (1.17 crore shares), Chambal Fertilizers and Chemicals (1.14 crore shares) and Reliance Natural Resources (94.69 lakh shares) are other volume toppers in that order.
Essar Oil clocked the highest turnover of Rs 183.42 crore on BSE. Reliance Capital (Rs 180.98 crore), Reliance Industries (Rs 173.06 crore), GSS America Infotech (Rs 142.8 crore) and Reliance Petroleum (Rs 142.36 crore) are among other turnover toppers in that order.
Among the side counters, private sector oil refiner Essar Oil soared 5.61% to Rs 236.20. The company is reportedly mulling upto $5 billion fresh debt to fund its $6 billion refinery capacity expansion programme at Vadinar, Gujarat and for acquisition of oil and gas blocks.
India's largest drug maker by market capitalisation Sun Pharmaceuticals jumped 3.13% to Rs 1,446.80. The company reported 59.2% surge in net profit to Rs 247.89 crore on 32.1% rise in net sales to Rs 780.74 crore in Q4 March 2008 over Q4 March 2007. The company announced the results after trading hours on Friday, 30 May 2008.
Monsanto India plunged 14.12% to Rs 1653.10 after the company’s shares started trading at Rs 180 per share ex-dividend from today, 2 June 2008.
Sesa Goa slumped 7.94% to Rs 3,946.25 after reports that the government has imposed 15% export duty on iron ore.
Zandu Pharmaceuticals Works galloped 19.54% to Rs 9,714.90 after Emami raised its stake in the company to 27.51% for an undisclosed amount.
Punj Lloyd plunged 10.53% to Rs 287.05 despite reporting 459.6% surge in net profit to Rs 129.71 crore on 87.8% rise in net sales to Rs 1499.40 crore in Q4 March 2008 over Q4 March 2007.
Sterlite Industries India declined 1.95% to Rs 916.70 after the company agreed to buy assets of USA's third largest copper producer Asarco for $2.6 billion in cash.
European markets, which opened after Indian market, were trading weak. Key benchmark indices in France, Germany and UK were down by between 1.1% to 1.36%.
Most of the Asian markets settled higher today, 2 June 2008. Hong Kong's Hang Seng, Taiwan Weighted, Singapore's Straits Times and Japan's Nikkei, China's Shanghai Composite were up by between 0.34% to 1.22%.
However South Korea’s Seoul Composite declined 0.24% at 1,847.99.
US markets closed mixed on Friday, 30 May 2008. Dell earnings were better than expectations and rebound in oil price led technology and energy shares higher. The Dow Jones industrial average fell 7.9 points to 12,638.32. However the technology-led Nasdaq Composite index gained 14.34 points to 2, 522.66.
U.S. light, sweet crude oil futures dipped 14 cents to $127.21 a barrel today, 2 June 2008 as traders took profits tracking the dollar for direction.
India's GDP grew a strong 8.8% in Q4 March 2008 from a year earlier, led by strong expansion in the services sector, data released by the government on Friday, 30 May 2008 showed. The Q4 annual GDP growth matched an upwardly revised 8.8% growth in Q3 December 2007. The GDP growth was 9% in FY 2008 (year ended March 2008). The government had earlier estimated annual growth of 8.7% in FY 2008.
India's inflation based on the wholesale price index rose 8.1% in 12 months to 17 May 2008, the highest reading in more than 3-½ years and above the previous week's annual rise of 7.82%, government data released on Friday, 30 May 2008, showed. Inflation for the week ended 22 March 2008 was revised upwards to 7.85% from 7%.
Liberalisation of imports, banning exports and a cut in excise and customs duties are some of the many steps initiated by the United Progressive Alliance (UPA) government to control inflation in the country, Finance Minister P Chidambaram said on 1 June 2008.
We will control inflation - PC
Liberalisation of imports, banning exports and a cut in excise and customs duties are some of the many steps initiated by the UPA government to control inflation in the country, Finance Minister P Chidambaram said here Sunday.
He said rising inflation, linked to the global price of crude oil, was a cause for concern. "An unprecedented situation is now being witnessed on the price front," he said.
The government is fully resolved to control price rise and suggestions were welcome to inject more measures to keep prices on hold, he said, addressing Congress party workers at the PCC office here on his one-day visit to Puducherry.
He said the economy had grown by nine per cent, which had been "out of bounds" for the erstwhile BJP-led NDA government, and added that several anti-poverty measures initiated by the government had come as a boon to the rural poor.
He said that introduction of the National Rural Employees Guarantee Act was a "sacrosanct step" which could never be disturbed for next two decades or so.
Chidambaram said that the government`s target to disburse Rs 2.80 lakh crore under farm loans this year would be exceeded and the coverage would be around Rs three lakh crore.
He said waiver of farm loans to benefit 71,680 farmers would be done by this month end as announced earlier. As far as Puducherry was concerned, around 30,800 farmers would benefit from the loan waiver scheme.
Weekly Scrip Watch - June 1 2008
INDIAN OIL
RESEARCH: MERRILL LYNCH
RATING: BUY
CMP:Rs 425
Merrill Lynch retains its ‘buy’ rating on IndianOil (IOC) with a price target of Rs 507. The target price is based on a P/E multiple of 7x on FY09E consolidated EPS of Rs 57. The target prices include the market value of IOC’s investments in ONGC, Petronet LNG and Gail of Rs 142 per share.
IOC’s FY09E earnings forecast is higher than its FY07 earnings (Rs 50.2/share), but lower than the forecast for FY08E (Rs 95/share). The P/E used by Merrill Lynch to value IOC is lower than Asian refiners’ average FY09E/08E P/E. IOC’s consolidated EPS for FY08 jumped by 37% y-o-y to Rs 69 per share. It was mainly driven by a 115% y-o-y rise in refining margins ($9/bbl versus $4.2/bbl in FY07) and inventory gains in FY08 vis-Ã -vis a loss in FY07.
Other income also surged 84% y-o-y to Rs 5,100 crore. IOC trades at attractive valuations of 6.1-7.4x on FY08-09E EPS. The downside risks for IOC include: (1) Government fails to issue enough oil bonds to keep IOC in the black; (2) Government reverts to a cost-plus based regulated pricing mechanism; (3) Steep decline in regional refining margins, and hence, IOC’s refining margins to levels below those assumed by Merrill Lynch; and 4) Steep decline in the market price of ONGC, Petronet LNG and Gail.
TATA MOTORS
RESEARCH:MACQUARIE
RATING:OUTPERFORM
CMP:Rs 577
Following Tata Motors’ financing plan, Macquarie expects the company’s fully diluted equity base to rise by 44-48%, depending on the price. In FY03-09, the basic number of shares can increase by 30-35%, while the remainder will be converted in 3-5 years.
The rights issue is set to be priced at around Rs 350/share; while the subsequent convertible preference shares should be at a conversion price of Rs 450-500/share. In addition, Jaguar Land Rover (JLR) will raise debt on its balance sheet.
The management has cautioned against extrapolating Q1 CY08 profit ($421 million) of JLR into the full year. Further details on the profitability of JLR are expected in June. Operating environment for the core automotive business remains tough. Profitability remains under pressure due to strong raw material costs.
The standalone pre-exceptional profit at Rs 480 crore was well below estimates. The operating margins were disappointing at 9.1% (down 196 bps y-o-y).
MAHINDRA & MAHINDRA
RESEARCH:CITIGROUP
RATING:BUY
CMP:Rs 593
Mahindra and Mahindra (M&M)’s reported PAT of Rs 221 crore was buoyed by an exceptional gain following the restructuring of the holdings among group subsidiaries. The management has indicated that pricing in both key segments — utility vehicles (UV) and tractors — remains fairly buoyant and rising cost pressures will be passed on, but margins can decline further, given the harsh commodity price environment.
The sharp uptick in capital costs is disconcerting. There are downside risks to the estimates on account of escalating capital costs, given the company’s aggressive capital expenditure programme of Rs 9,000 crore over the next three years.
Citigroup forecasts 12-13% growth in the UV business, in line with the management’s outlook and sees some downside risks to the forecast for the tractor business (currently 7% CAGR over FY09/10E), given issues with regard to availability of credit, and also the growing moral hazard within the banking sector that can further starve the sector of credit over the long term.
EVEREST KANTO CYLINDER
RESEARCH:CLSA
RATING:BUY
CMP:Rs 315
CLSA reiterates its ‘buy’ recommendation on Everest Kanto Cylinder and indicates a 17% upside on a 12-month basis. Everest Kanto, the high-pressure cylinder manufacturer of CNG and industrial cylinders, reported 45% PAT growth for FY08, in line with expectations. Net sales for FY08 stood at Rs 530 crore, up 24.4% y-o-y (up 31% y-o-y on a like-for-like basis, excluding trading revenues from FY07).
The company sold ~6,53,000 cylinders in FY08, of which, 3,98,000 were for CNG applications, while the balance was for industrial purposes. CNG cylinders account for 60% of the mix by unit volume, but 72% of sales by value. Total debt on the balance sheet is $75 million, of which, $45 million is on account of the company’s bank-guaranteed debt for the acquisition of the jumbo cylinder manufacturing unit of CP Industries.
The annual cost of debt is about 7%. Everest Kanto has spent $66.3 million for the large pressure vessel plant of CP Industries, incorporating step-down subsidiaries in Hungary and the US. This division complements the product portfolio of Everest Kanto, which already has CNG and industrial cylinders in its fold, with high-value jumbo cylinders.
The company expects to produce 3,500 jumbo cylinders in FY09 and expects realisations of about $15,000 per unit. There is an 11% translation loss on consolidation of Dubai accounts in Indian rupees due to the depreciation of the US dollar.
SIEMENS INDIA
RESEARCH:INDIABULLS FINANCIALS
RATING:HOLD
CMP:Rs 560
Indiabulls Financials reiterates its ‘hold’ rating on Siemens India. Siemens’ lacklustre performance of Q1 FY08 continued in Q2 FY08, as revenues grew by a meagre 0.6% y-o-y. Lower revenue, coupled with a tepid order inflow, translates into lower visibility on earnings potential.
But considering the conducive demand for power, automation, industrial services and healthcare products, Indiabulls believes Siemens can win base orders to ensure an RoE of 27-30% over the next two years.
The management is confident of doubling revenues by ’10. To meet this target, it plans to expand its transformer manufacturing capacity, start manufacturing turbines and optimise its existing processes. At CMP, the stock trades at a forward P/E of 29.4x its FY08E and 21.8x its FY09E earnings. Siemens believes its nearterm EPS may face the impact of disposal of value-accretive businesses and higher costs during Q2 FY08.
Indiabulls has cut the company’s earnings forecast for FY08E and FY09E by 13.5% and 11.1%, respectively, to factor in cost escalation. So, Siemens may report a CAGR of 22.2% in revenues and 21.5% in earnings over FY07-09E. Based on Indiabulls’ DCF valuation, the stock is fairly valued and no major upside from current levels is foreseen.
ING VYSYA BANK
RESEARCH:HSBC
RATING:UNDERWEIGHT
CMP:Rs 291
After lagging its peers in loan and deposit growth, ING Vysya Bank has been showing signs of recovery. Growth in advances improved to 22% in FY08 from 17% in the previous year. Growth in total deposits accelerated to 33% from 16%. This helped the bank to improve its market share to 0.6% from 0.5%.
High cost ratios vis-Ã -vis its peers have been a stress point for ING Vysya Bank. While the bank’s cost-income ratio has fallen marginally y-o-y, it continues to be higher than for most peers. The main reason for this is employee productivity, which has shown little improvement over the past year, despite continued investment in branches and employees.
The focus on opening new branches in urban areas can help alleviate stress in the long term, though near-term respite looks unlikely. HSBC raises its net profit forecasts for FY10 and initiates forecasts for FY11. The revised target price of Rs 270 is 8% higher than the previous target price.
HSBC benchmarks the returns of ING Vysya Bank against select state-owned and private sector banks under its coverage. The bank continues to lag its peers in key profitability metrics due to low margins and high cost ratios.
Pre Session Commentary - June 2 2008
The Indian Market is likely to open in positive zone on the back of mixed cues from the global markets. On Friday, Indian market closed in green due to the strong buying support despite rise in inflation figures. The market opened with gain higher tracking the favoring cues from the US Markets and was trading firm due to buying in key stocks on the back of favorable global cues and Nifty June futures series which settled at premium. Further, it continued the same momentum to close in positive. The capital goods and metal stocks were in limelight as most of the buying was seen from these baskets. The BSE Sensex closed higher by 99.31 points at 16,415.57 and NSE Nifty went up by 34.80 points to close at 4,870.10. We expect that the market may remain volatile today.
Auto LPG price hiked by Rs2.52 from Saturday midnight. PSU Oil companies have announced this increase. While the Centre had postponed increase in petrol, diesel and domestic LPG to this week.
It is expected for the Indian Rupee to surge on Monday as central bank may provide foreign exchange to oil refiners which would reduce dollar demand in the currency market. On Friday, after closing of market the central bank informed that it would conduct open market operations in the secondary market in oil bonds held by state-run oil companies to provide liquidity to crude refiners.
On Friday, the US market closed mixed. The NASDAQ (DJIA) closed higher by 14.34 points at 2,522.66 along with S&P 500 went up by 2.12 points to close at 1,400.38 while Dow Jones Industrial Average dropped by 7.90 points to close at 12,638.32.
Major Indian ADRS ended up as in technology sector, Infosys raised by (8.27%) along with Satyam by (5.78%), Wipro by (2.39%) while Patni Computers dropped by (0.76%). In banking sector, HDFC bank and ICICI bank increased by (2.18%) and (0.05%) respectively. In telecommunication sector, MTNL fell by (10.99%) while Tata Communication advanced by (2.66%). Sterlite industries went up by (3.02%).
Today the major stock markets in Asia are trading mixed. Taiwan Weighted Index is trading up by 62.22 points at 8,681.30 along with Hang Seng index trading high by 59.50 points at 24,592.62 while Japan''s Nikkei is flat at 14,346.
The FIIs on Friday stood as net seller in equity. The gross equity purchased was Rs4,208.90 Crore and the gross debt purchased was Rs0.00 Crore while the gross equity sold stood at Rs5,290.70 Crore and gross debt sold stood at Rs0.00 Crore. Therefore, the net investment of equity reported was (R1,083.90) Crore and net debt was Rs0.00 Crore.
Today, Nifty has support at 4,761 and resistance at 4,936 and BSE Sensex has support at 16,134 and resistance at 16,648.
Precious metals register modest gains
Gold prices drop for the week but ends month with a higher note
After dropping for three straight days, precious metals ended higher on Friday, 30 May, 2008. During that day, the dollar traded slightly lower against most of its major rivals, erasing earlier modest gains but still on track to mark a positive month overall. For the month of May, overall strength in the U.S. dollar and recent declines in oil prices in last week helped to dull investment appeal for the precious metal, which is often used as a hedge against inflation.
Comex Gold for August delivery rose $9.8 (1.1%) to close at $891.5 ounce on the New York Mercantile Exchange. For the week, gold prices ended lower by 4.2%. But for the month of May, it ended with a gain of higher by $22.5 (2.5%). On 17 March, 2008 prices had skyrocketed to a high of $1,034/ounce. But prices have dropped since then.
This year, gold prices have gained 6.5% for the till date against a 6.5% drop for the dollar against the euro. Before May, for April, prices closed lower by 6.3%. For first quarter prices gained 10.7%. In January, prices gained 11%, the highest monthly gain since April 2006. For February, it gained 6%. But in March, prices succumbed and fell by 5.5%.
On Friday, Comex silver futures for July delivery rose 35 cents (2.1%) to $16.87 an ounce. Silver has gained 13.2% in 2008 till date. It finished 7.5% lower for the week.
Silver prices ended the month of May 2008 with a gain of 2.7%. For April, it closed lower by 5.5%. Silver had gained 16% in Q1. In January this year itself, prices climbed 14%. In February, it gained another 15%. For March, it ended lower by 13%. The metal had climbed 16% in FY 2007. The metal also has gained for seven straight years.
The weakening dollar and higher global demand for raw materials have led to records this year for commodities including gold. Last week, crude oil's rally to a fresh record high above $133 a barrel had boosted the precious metal's appeal as an inflation hedge. Oil has doubled in the past year, fueling concern inflation will accelerate.
Gold has traditionally been used as a safe-haven asset against rising inflation. Investor sentiments are boosted by the fact that gold and silver are alternate sources of good investment in the face of declining dollar and rising energy prices. Generally, a stronger dollar pressures demand for dollar-denominated commodities, such as crude oil and gold, which become more expensive for holders of other currencies. On the other hand, a lower dollar pushes up precious metal prices as their demand lessens as it becomes cheaper for traders holding other currencies.
Today's Pick - TV18
We recommend a buy in TV 18 from a short-term perspective. We note that the stock has been on an intermediate-term downtrend form its January 2008 high of Rs 599 levels. However, the stock found support at around Rs 300 level in late April and again in mid May the stock found support just above this level.
The stock has formed a falling wedge pattern spanning over the past four months, which is a bullish pattern. Falling wedge pattern has occurred at the bottom of the downtrend indicating reversal in the current trend. The daily momentum indicator has found support at 40 levels recently and bounced up. The daily moving average convergence and divergence is displaying positive divergence, supporting our bullish view.
We are bullish on the stock in the short-term. We expect the stock to rally to our price target of Rs 360 in the upcoming trading sessions. Traders with short-term perspective can buy the stock while keeping the stop-loss at Rs 300
Crude prices end little higher
Crude oil and natural gas end month 12% and 8% higher respectively
After marking a sharp drop a day before, crude prices ended little higher on Friday, 30 May, 2008. Weather was on everyone’s mind on that day and traders were keen on taking positions before the official start of the hurricane season. Prices fell to a two week low earlier in the season. The hurricane season in the Atlantic, which has the potential to disrupt oil and natural gas production in the Gulf of Mexico, officially begins on 1 June.
Crude-oil futures for light sweet crude for July delivery today closed at $127.35/barrel (higher by $0.73/barrel or 0.6%) on the New York Mercantile Exchange. Prices fell to a two week low of $125.7 earlier in the season.
For the week, crude prices closed lower by 3.7%. Last week, prices had touched an all time high of $135.09. The July contract ended last month at $112.73, so the contract itself is up 13% for the month. For the year, crude is up by 32% till date. Prices have more than doubled on a yearly basis.
Earlier during the week, the Energy Department reported that crude supplies dropped by 8.8 million barrels to 311.6 million for the week ended 23 May. The drop was reportedly due to temporary delays in crude oil tanker off-loadings. Refinery utilization was unchanged last week from the previous week at 87.9% of capacity.
EIA also reported that motor gasoline supplies fell 3.2 million barrels to 206.2 million barrels and distillate stocks were up 1.6 million barrels at 109.4 million barrels.
Dollar weakness typically benefits dollar-denominated commodities, such as gold and crude oil, because it makes them cheaper for holders of other currencies. On the other hand strong dollar reduces the appeal of the metal as alternate source of investment.
Trading Calls - June 2 2008
Nifty (4870) Sup 4820 Res 4910
Buy HCL Tech (315) SL 310. Target 324, 328
Buy Aban Offshore (4002) SL 3980. Target 4045, 4060
Buy Satyam (524) SL 519
Target 534, 537
Buy Sterlite (937) SL 928
Target 960, 965
Sell Bank Baroda (272) SL 277
Target 264, 260
Don’t get alarmed!
There are more things to alarm us than to harm us, and we suffer more often in apprehension than reality.”
Market's worst fears have turned out to be a case of false alarm. We are of course talking about the GDP numbers, which came in ahead expectations. At 9%, the FY08 GDP growth beat all optimistic forecasts. That too when most were expecting a contraction due to a slowdown in industrial activity. An improved show by the farm sector helped as did the continued momentum in services. For the current fiscal year, expectations are for 8-8.5% GDP growth. This is pretty good considering the fact that it will come on top of the high base of last year. What's more, the strong growth momentum underscores India's long-term macro-economic fundamentals amid a slew of headwinds and a slowing global economy. So, in that sense, the bulls should be happy.
Of course, ground reality remains that rising inflation is reducing the weight of wallets across the board. Inflation has the potential to touch double-digits in a few week's time. If inflation does spiral out of control, the RBI will have no choice but to resort to some tightening measures. The RBI may even hike the repo rate, which may not please India Inc and the bulls.
For the day, we expect the market to open on a cautious to flat note as most global markets are sluggish. Thereafter, the trend will turn sideways and rangebound. With the GDP data out of the way, the focus will be on crude oil prices and whether the Government manages to bite the bullet and increase retail fuel prices.
Hexaware will be in action depending on what announcement they make. Sterlite Industries will be action after it announced acquisition of US copper mining company Asarco for $2.6bn. Airline companies will attract attention as oil PSUs have hiked ATF prices by a whopping 18%. Hero Honda and Bajaj Auto may rise as they have reported good monthly sales volume for May.
US technology stocks rallied for the fourth session in a row on Friday, on Dell's improved earnings. But the broader market struggled amid rising oil and gas prices, and a mix of economic news that did little to temper fears about a slowdown.
The Dow Jones Industrial Average fell 7 points to end at 12,638, leaving the blue-chip index with a weekly gain of 1.2%. The S&P 500 index added 2 points to 1,400 but fell 1.8% on the week. The technology-laden Nasdaq advanced 14 points to 2,522, giving it a weekly advance of 3.2%.
The Dow industrials fell 1.1% for the month of May, the broad S&P 500 still rose 1.1%. The Nasdaq jumped 4.6%.
US stocks were mostly up last week as the dollar firmed up and oil prices backed off. A report showed first-quarter GDP growth was better than initially reported, while Friday's economic news was mixed.
Reports showed an increase in personal income, in-line inflation, weaker consumer sentiment and continued weakness in manufacturing.
The range-bound trading in the US is not likely to change soon. Monday, the first trading day of June, brings economic reports on construction spending and manufacturing. No market-moving earnings reports are due though.
Wall Street will most likely remain cautious ahead of Friday's jobs data. But, there will be some market-moving data on manufacturing on Monday, and one can get an early peak into jobs from the private sector report on Wednesday.
Personal income rose 0.2% in April, the government said, matching forecasts. Personal spending rose 0.2%, also as expected. Core PCE, the report's closely watched inflation measure, gained 0.1% as expected.
Chicago PMI, a regional read on manufacturing, rose to 49.1, edging expectations. However, any reading below 50 shows continued weakness in the sector. The University of Michigan's May consumer sentiment index was revised higher to 59.8 from an initial reading of 59.5. The index stood at 62.6 in April.
US light crude oil for July delivery rose 73 cents to settle at $127.35 a barrel on the New York Mercantile Exchange, offsetting early gains. On Thursday, oil prices had slipped more than $4 a barrel.
The national average price for a gallon of regular unleaded gas rose to a record $3.962 from the previous day's record of $3.952, AAA reported.
Treasury prices rose, lowering the yield on the 10-year note to 4.05% from 4.07%. The dollar fell versus the euro and gained versus the yen. Gold prices rose, bouncing back after several down days. COMEX gold for August delivery rose $9.80 to settle at $891.50 an ounce.
Dell reported higher quarterly sales and earnings late Thursday that topped estimates thanks to cost cutting, notebook sales and growth in markets overseas. Shares gained 5.7%.
United Airlines and US Airways formally abandoned plans to merge - a combination that would have created the world's largest airline, but also would have limited routes and boosted ticket prices. Shares of United parent company UAL rose modestly, while US Airways stock lost 8.3%.
European shares ended the last trading day of the month on an upbeat note. The pan-European Dow Jones Stoxx 600 index extended its winning streak to four sessions, up 0.4% to 322.09. For the week, the index has climbed 1% but is still showing a slight loss for the month after closing at 323.09 on April 30.
Germany's DAX 30 advanced 0.6% to 7,096.79 while the French CAC-40 climbed 0.8% to 5,014.28. The UK's FTSE 100 closed down 0.2% at 6,053.50.
Bulls look to carry momentum
For the second consecutive day it was a highly volatile session. However, on Friday it was the bulls that took charge in the second half of the day led by gains in the Capital Goods, IT and the Pharma stocks.
After an early bounce back bulls were unable to hold on to their gains as traders turned cautious ahead of the Economic data to be released during the day. GDP numbers which were released failed to cheer the bulls. Even the Inflation figures barely had any impact on the market sentiment.
India’s Economy grew 8.8% in Jan-March quarter from year ago beating market expectations. Analyst had expected GDP at 8.1%. The country’s farm out-put grew 2.9%, mining grew 5.9% and electricity grew 5.6%. India’s trade, hotels and transport grew 12.4% in quarter to March.
Finally, the BSE benchmark Sensex ended 99 points higher to close at 16,415 and the Nifty index gained 34 points to close at 4,870.
India’s Inflation accelerated to 8.1%, highest in 3 ½ years. The Wholesale Price index climbed further in the third week of May even as the government grapples with high crude oil prices and its adverse impact on public sector oil marketing companies.
Among the BSE Sectoral indices, the BSE Power, Realty and Oil & Gas fell over 1.5% each. On the other hand, Capital Goods, IT and the Pharma index added over 1.5% each. Among the broader indices, the Mid-Cap index was up 0.3% while, the Small-Cap index was down 0.6%.
Overall about 1,013 stocks advanced; 1,692 stocks declined while 61 stocks remained unchanged. Among the 50-Nifty 29 stocks ended in green and 21 stocks ended in red.
Ranbaxy gained by over 4.5% to Rs528 after reports stated that Orchid Chemicals would convert business alliance with Ranbaxy into an agreement next month. There were also reports stating that Ranbaxy has tied up with PVR Cinemas to give free samples of its best selling energy pill Revital. The scrip touched an intra-day high of Rs534 and a low of Rs506 and recorded volumes of over 10,00,000 shares on NSE.
Cadila advanced by 1.6% to Rs295 after the company announced its foray into Spain with the acquisition of 100% stake in Laboratories Combix. Combix which has a pure generics focus provides the right fit for Zydus' entry strategy into a market that is estimated at $1.7bn and is growing at 21.5% compared to 6% for the overall pharmaceutical market in 2007.
The Spanish pharmaceutical market is the 5th largest in Europe. Established in 2006, Combix with a sales and marketing focus has a solid portfolio covering 17 molecules.
Additionally, it has a range of products that are pending launch or in the pipeline. The acquisition allows Zydus to jumpstart its business and leverage strengths in product development, a high quality, cost-competitive supply chain and operational efficiency. The scrip has touched an intra-day high of Rs300 and a low of Rs292.
L&T extended previous day’s momentum as the stock further surged by over 3% to Rs2981 after the company on Thursday announced issues 1:1 bonus to equity shareholders. There were also reports stating that the company schedules first of three IPOs for 2009-10. The scrip touched an intra-day high of Rs3045 and a low of Rs2915 and recorded volumes of over 700,000 shares on NSE.
Aegis Logistics lost early gains and slipped down by 1.5% to end at Rs238. The company’s results for FY08 showed Rs38.9mn, revenue up 62%. Logistics business revenue was up by 40% and Gas revenue was up by 68%.Growth in Gas revenues was partly due to increase in International gas prices apart from increase in volumes by 33%. Overall net profit of the group increased to Rs380mn with a rise of 78%.
The Company plans further expansion by setting up additional capacities in Logistic Sector and by continuing its rollout plan of Autogas Stations in Gas Business. The scrip touched an intra-day high of Rs262 and a low of Rs237 and recorded volumes of over 18,000 shares on NSE.
Sobha Developers gained by over 2.5% to Rs498 after the company said that it posted a net profit of Rs702mn for the quarter ended March 31, 2008 as compared to Rs620mn for the quarter ended March 31, 2007. The total Income has increased from Rs3589mn for the quarter ended March 31, 2007 to Rs4765mn for the quarter ended March 31, 2008.The scrip touched an intra-day high of Rs511 and a low of Rs485 and recorded volumes of over 1,00,000 shares on NSE.
Karuturi Global ended flat at Rs26. Reports stated that the company said that they would raise US$250mn for agriculture project in Ethopia. The scrip touched an intra-day high of Rs27 and a low of Rs26 and recorded volumes of over 12,00,000 shares on NSE.
Exide Industries was up by 1% to Rs74, the company said that it has planned to acquire lead smelter company for Rs350mn. The scrip touched an intra-day high of Rs75 and a low of Rs73 and recorded volumes of over 56,000 shares on NSE.
Videocon Industries slightly slipped by 1.5% to Rs350. The company said that it is planning to set up a 1,000MW hydropower project in Uttaranchal with an investment of Rs60bn, reports stated. The scrip touched an intra-day high of Rs368 and a low of Rs289 and recorded volumes of over 2,00,000 shares on NSE.
Recently listed Piramal Life lost ground and slipped by over 6% to Rs294. According to reports, the company said that it would invest Rs2bn per anum for next 2-3 years on R&D. The scrip touched an intra-day high of Rs329 and a low of Rs269 and recorded volumes of over 58,00,000 shares on NSE.
Jubilant Organosys marginally slipped by half a percent to Rs349. Reports stated that the company completed the acquisition of Canadian based Draxis Speciality Pharmaceuticals for US$253mn. The scrip touched an intra-day high of Rs359 and a low of Rs349 and recorded volumes of over 1,000 shares on NSE.
Corporate News
Sterlite Industries to buy operating assets of Asarco, a US based mining, smelting and refining firm for US$2.6bn. (BL)
Essar Oil bids for an offshore block in Australia; in talks with foreign companies to explore for oil in Egypt and Yemen. (BS)
Emaar MGF plans to develop 31mn sq.ft of commercial, residential, SEZs and hospitality spaces in South India at an investment of Rs125bn.(FE)
HDFC Venture has picked up 49% stake in two subsidiaries of Godrej Properties, the real estate arm of Godrej group.(BS)
Government asks NTPC to resolve all its disputes with foreign vendors.(ET)
JSW Steel to invest US$500mn over next three years to expand capacity of iron ore mines acquired in Chile.(BL)
L&T plans to invest Rs25bn in the current fiscal to augment capacities at its growth centers.(DNA)
Bajaj Auto posts 7.6% growth in motorcycles sales in May; Hero Honda motorcycles sales growth rises 9.5%.(BS)
Tata Steel to raise its Jamshedpur plant capacity to 10mn tons pa by 2010.(BL)
M&M defers its plan to build a Rs4bn tractor facility in Chennai.(BS)
Apollo Gleneagles to invest Rs14bn in the next two years to set up 2,000 more beds.(BL)
Alstom Power is likely to enter into a US$500mn JV with Bharat Forge.(ET)
BSNL may go for a listing as trade unions likely to respond positively to the government’s call in this regard.(TOI)
Godrej Properties files a draft prospectus for its IPO; estimated to raise up to Rs6bn.(FE)
Air India announces hike in fare prices as ATF prices go up.(Mint)
Essar Oil to raise fresh debt of up to US$5bn through ECB.(BL)
Rashtriya Ispat Nigam is mulling a merger with NMDC.(BL)
Emami group acquires 27.5% stake in Zandu Pharmaceutical.(TOI)
Satyam Computers takes on lease 0.4mn sq ft of office space in Chennai SEZ.(BL)
UB Group in talks with France based EADS Socata to invest US$200mn to co-develop business for jets.(DNA)
BPCL may improve capacity utilization after merger with IOC. (BL)
L&T on look out for a JV with Indian Railways to manufacture equipment for the railways.(ET)
Elder Pharmaceuticals to invest Rs250mn in API space.(DNA)
Times of India group buys UK based Virgin Radio for Rs4.5bn.(TOI)
Genpact, EXL Services may buy a major stake in Infovision.(ET)
Sun Pharma to file 30 ANDAs in FY09.(DNA)
MRTPC issues notification to Dish TV over misleading advertisement of its free set-top box offer.(TOI)
DHL is planning to make an offer to shareholders of Blue Dart.(ET)
Mercator Lines renews a vessel charter to ArcelorMittal for two more years.(BL)
WNS Holdings emerges as the highest bidder for Aviva’s BPO operations with an offer of US$200mn.(ET)
Economic News
Fiscal deficit touches Rs329bn for April; constitutes 24.7% of the fiscal 2009 target.(FE)
Government allowssoftware developers, hotels and hospitals to raise up to US$100mn for import of capital goods.(ET) Government is believed to have decided to impose 15% export duty on iron ore.(TOI)
Air fares to go up with the government announcing an 18.5% average increase in ATF prices.(FE)
India turns into a net importer of steel with imports of 7mn tons in 2007-08.(BS)
Committee of Secretaries decides to remove export duty on most steel products.(DNA)
JNPT to invest Rs70bn in an up gradation drive.(ET)
Kerala and West Bengal government may reduce sales tax on petrol and diesel.(BS)
Department of Post in talks with Deutsche Postbank to enter into housing loan business.(FE)
Government to consider uniform state laws for liquor.(BS)
Finance ministry turns down a proposal from DIPP to give 35% abatement on excise duty to cement manufacturers.(ET)
Government announces 1% reduction in central sales tax.(FE)
RBI issues new draft norms to review current stipulations to minutely monitor off-balance sheet exposures of banks.(ET)
GoM to take a call on whether foreign and domestic companies can participate in the auction for 3G spectrum.(FE)
Indian shipping firms would meet a global deadline to phase out all single-hull tankers by 2010.(BL)
Morning Call - June 2 2008
Market Grape Wine :
Out House :
Markets at a support of 16212 & 16111 and resistance at 16484 & 16591 levels .
Buy : INFY & Satyam
Buy : LT
Buy : Bhel
Buy : RPL & EssarOIL
Buy : SesaGoa
Buy : Bharti
Buy : Emami
Buy : ITC
Dark Horse : Emami , ITC , Cairn ,INFY , SesaGoa & Satyam
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