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Monday, August 18, 2008
BSE Bulk Deals to Watch - Aug 18 2008
Deal Date Scrip Code Company Client Name Deal Type * Quantity Price **
18/8/2008 531602 KOFF BR PICT LAXMI CAP BROKING PVT LTD S 61261 23.71
18/8/2008 533010 OCTAV INVES MANSUKH STOCK BROKERS LTD B 32469 87.89
18/8/2008 533010 OCTAV INVES MANSUKH SECURITIES AND FINANCE LTD B 20276 87.71
18/8/2008 533010 OCTAV INVES YUVAK SHARE TRADING PVT LTD B 19445 86.26
18/8/2008 533010 OCTAV INVES MANSUKH STOCK BROKERS LTD S 32469 88.22
18/8/2008 533010 OCTAV INVES MANSUKH SECURITIES AND FINANCE LTD S 20276 88.23
18/8/2008 533010 OCTAV INVES YUVAK SHARE TRADING PVT LTD S 19445 88.50
18/8/2008 532606 PAREKH ALUM CONSOLIDATED SECURITIES LTD B 100000 131.00
18/8/2008 500339 RAIN COMMODI MORGAN STANLEY MAURITIUS COMPANY LTD S 406919 220.00
18/8/2008 532884 REFEX REFRIG NITIN DHARAMSHI GORATELA B 90000 276.00
18/8/2008 531033 REGAL ENT CO UPSURGE INVESTMENT AND FINANCE LTD B 18299 5.81
18/8/2008 526407 RIT PRO IND GIRISHBHAI CHANDULAL SANGHVI B 47830 117.75
18/8/2008 505590 SCENARIO MED SMP SECUTITES LIMITED B 5000 124.95
18/8/2008 532886 SEL MANUF HARDIK M MITHANI B 164964 380.41
18/8/2008 532886 SEL MANUF SPJSTOCK B 214767 375.58
18/8/2008 532886 SEL MANUF B K SHAH CO B 107507 370.47
18/8/2008 532886 SEL MANUF HARDIK M MITHANI S 164964 381.74
18/8/2008 532886 SEL MANUF SPJSTOCK S 214767 376.85
18/8/2008 532886 SEL MANUF B K SHAH CO S 110199 362.27
18/8/2008 505075 SETCO AUTO SETCO ENGINEERING PVT LTD B 150000 180.00
18/8/2008 505075 SETCO AUTO SNEHA HARISH SHETH S 150000 180.00
18/8/2008 531431 SHAKTI PUMPS ROULEX INVESTMENT AND FINANCE PVT LTD B 65469 100.00
18/8/2008 531431 SHAKTI PUMPS POOJA MUKUND JALAN S 50000 100.00
18/8/2008 513530 STELCO STRIP INDEX SECURITIES AND RESEARCH PV B 53821 20.20
18/8/2008 533011 VISHAL INFO MARWADI SHARES AND FINANCE LIMITED B 55204 258.30
18/8/2008 533011 VISHAL INFO SAM GLOBAL SECURITIES LTD B 189727 260.46
18/8/2008 533011 VISHAL INFO H.J.SECURITIES P.LTD. B 180147 257.60
18/8/2008 533011 VISHAL INFO MEENAL NITESH THAKUR B 126161 260.54
18/8/2008 533011 VISHAL INFO YUVAK SHARE TRADING PVT LTD B 69884 260.60
18/8/2008 533011 VISHAL INFO MARWADI SHARES AND FINANCE LIMITED S 55204 258.44
18/8/2008 533011 VISHAL INFO SAM GLOBAL SECURITIES LTD S 189727 260.53
18/8/2008 533011 VISHAL INFO H.J.SECURITIES P.LTD. S 180147 257.86
18/8/2008 533011 VISHAL INFO MEENAL NITESH THAKUR S 126161 259.81
18/8/2008 533011 VISHAL INFO YUVAK SHARE TRADING PVT LTD S 70090 260.50
NSE Bulk Deals To Watch - Aug 18 2008
Date,Symbol,Security Name,Client Name,Buy/Sell,Quantity Traded,Trade Price / Wght. Avg. Price,Remarks
18-AUG-2008,CERA,Cera Sanitaryware Limited,DEEPLOK BUILDERS PRIVATE LIMITED,BUY,40500,134.51,-
18-AUG-2008,OCTAV,Octav Investments Limited,ANKITA VISHAL SHAH,BUY,19120,88.99,-
18-AUG-2008,OCTAV,Octav Investments Limited,ASIT C MEHTA INVESTMENT INTERRMEDIATES LTD,BUY,83069,89.39,-
18-AUG-2008,OCTAV,Octav Investments Limited,MANSUKH SECURITIES & FINANCE LTD,BUY,51489,87.76,-
18-AUG-2008,OCTAV,Octav Investments Limited,PRAGATI PAPER MILLS LTD,BUY,19437,87.50,-
18-AUG-2008,OCTAV,Octav Investments Limited,SHRI BRIJ SECURITIES PVT.LTD.,BUY,19955,86.50,-
18-AUG-2008,OCTAV,Octav Investments Limited,TRANSGLOBAL SECURITIES LTD.,BUY,38404,87.64,-
18-AUG-2008,OCTAV,Octav Investments Limited,YUVAK SHARE TRADING PVT LTD,BUY,11198,89.81,-
18-AUG-2008,SELMCL,SEL Manufacturing Company,B K SHAH CO KETAN BHAILAL SHAH,BUY,135011,362.36,-
18-AUG-2008,SELMCL,SEL Manufacturing Company,HARDIK M MITHANI,BUY,156407,377.40,-
18-AUG-2008,SUBEX,Subex Limited,MBL & COMPANY LTD.,BUY,255813,109.71,-
18-AUG-2008,SUBEX,Subex Limited,NAMAN SECURITIES & FINANCE PVT LTD,BUY,222780,109.15,-
18-AUG-2008,VITLINFO,Vishal Information Techno,AMBIT SECURITIES BROKING PVT. LTD.,BUY,78230,259.43,-
18-AUG-2008,VITLINFO,Vishal Information Techno,ASIT C MEHTA INVESTMENT INTERRMEDIATES LTD,BUY,208360,262.22,-
18-AUG-2008,VITLINFO,Vishal Information Techno,CHOKHANI SECURITIES LTD,BUY,190779,259.79,-
18-AUG-2008,VITLINFO,Vishal Information Techno,DINESH MUNJAL,BUY,243285,262.60,-
18-AUG-2008,VITLINFO,Vishal Information Techno,G RAMAKRISHNA,BUY,97000,262.99,-
18-AUG-2008,VITLINFO,Vishal Information Techno,G.S.V. COMMODITIES PRAVITE LIMITED,BUY,62635,262.74,-
18-AUG-2008,VITLINFO,Vishal Information Techno,HARBUX SINGH SIDHU,BUY,247198,262.18,-
18-AUG-2008,VITLINFO,Vishal Information Techno,KAUSHIK SHAH SHARES & SECURITIES PVT LTD,BUY,123274,261.04,-
18-AUG-2008,VITLINFO,Vishal Information Techno,MANIPUT INVESTMENTS PVT LTD,BUY,102368,260.25,-
18-AUG-2008,VITLINFO,Vishal Information Techno,MANSUKH SECURITIES & FINANCE LTD,BUY,77036,263.30,-
18-AUG-2008,VITLINFO,Vishal Information Techno,MEHTA VIRENDRA KUMAR,BUY,61705,262.73,-
18-AUG-2008,VITLINFO,Vishal Information Techno,PRAGATI PAPER MILLS LTD,BUY,58971,261.49,-
18-AUG-2008,VITLINFO,Vishal Information Techno,PRASHANT JAYANTILAL PATEL,BUY,143614,263.79,-
18-AUG-2008,VITLINFO,Vishal Information Techno,R.M. SHARE TRADING PVT LTD,BUY,230992,261.27,-
18-AUG-2008,VITLINFO,Vishal Information Techno,SMC GLOBAL SECURITIES LTD.,BUY,101836,259.91,-
18-AUG-2008,VITLINFO,Vishal Information Techno,TRANSGLOBAL SECURITIES LTD.,BUY,161018,261.44,-
18-AUG-2008,VITLINFO,Vishal Information Techno,YUVAK SHARE TRADING PVT LTD,BUY,114265,259.35,-
18-AUG-2008,BARTRONICS,Bartronics India Limited,PRIME INFO INVESTMENT LTD,SELL,312000,180.99,-
18-AUG-2008,BOMDYEING,Bombay Dyeing & Mfg Co.,DSP MERILL LYNCH MUTUAL FUND,SELL,220527,540.57,-
18-AUG-2008,CERA,Cera Sanitaryware Limited,DEUTSCHE INTERNATIONAL TRUST CORP.(MAURITIUS)LTD A/C MINIVET,SELL,40000,134.50,-
18-AUG-2008,OCTAV,Octav Investments Limited,ANKITA VISHAL SHAH,SELL,23120,89.53,-
18-AUG-2008,OCTAV,Octav Investments Limited,ASIT C MEHTA INVESTMENT INTERRMEDIATES LTD,SELL,83069,87.97,-
18-AUG-2008,OCTAV,Octav Investments Limited,MANSUKH SECURITIES & FINANCE LTD,SELL,52024,88.20,-
18-AUG-2008,OCTAV,Octav Investments Limited,PRAGATI PAPER MILLS LTD,SELL,19437,87.95,-
18-AUG-2008,OCTAV,Octav Investments Limited,SHRI BRIJ SECURITIES PVT.LTD.,SELL,19955,86.23,-
18-AUG-2008,OCTAV,Octav Investments Limited,TRANSGLOBAL SECURITIES LTD.,SELL,38404,87.75,-
18-AUG-2008,OCTAV,Octav Investments Limited,YUVAK SHARE TRADING PVT LTD,SELL,24063,87.98,-
18-AUG-2008,SELMCL,SEL Manufacturing Company,B K SHAH CO KETAN BHAILAL SHAH,SELL,135011,367.61,-
18-AUG-2008,SELMCL,SEL Manufacturing Company,HARDIK M MITHANI,SELL,156407,382.66,-
18-AUG-2008,SUBEX,Subex Limited,MBL & COMPANY LTD.,SELL,255813,109.76,-
18-AUG-2008,SUBEX,Subex Limited,NAMAN SECURITIES & FINANCE PVT LTD,SELL,225957,109.18,-
18-AUG-2008,VITLINFO,Vishal Information Techno,AMBIT SECURITIES BROKING PVT. LTD.,SELL,78230,259.33,-
18-AUG-2008,VITLINFO,Vishal Information Techno,ASIT C MEHTA INVESTMENT INTERRMEDIATES LTD,SELL,208360,262.72,-
18-AUG-2008,VITLINFO,Vishal Information Techno,CHOKHANI SECURITIES LTD,SELL,190779,261.08,-
18-AUG-2008,VITLINFO,Vishal Information Techno,DINESH MUNJAL,SELL,243285,262.81,-
18-AUG-2008,VITLINFO,Vishal Information Techno,G RAMAKRISHNA,SELL,97000,261.10,-
18-AUG-2008,VITLINFO,Vishal Information Techno,G.S.V. COMMODITIES PRAVITE LIMITED,SELL,62635,262.21,-
18-AUG-2008,VITLINFO,Vishal Information Techno,HARBUX SINGH SIDHU,SELL,247198,262.29,-
18-AUG-2008,VITLINFO,Vishal Information Techno,KAUSHIK SHAH SHARES & SECURITIES PVT LTD,SELL,123274,261.56,-
18-AUG-2008,VITLINFO,Vishal Information Techno,MANIPUT INVESTMENTS PVT LTD,SELL,102368,260.41,-
18-AUG-2008,VITLINFO,Vishal Information Techno,MANSUKH SECURITIES & FINANCE LTD,SELL,77036,263.87,-
18-AUG-2008,VITLINFO,Vishal Information Techno,MEHTA VIRENDRA KUMAR,SELL,61705,262.63,-
18-AUG-2008,VITLINFO,Vishal Information Techno,PRAGATI PAPER MILLS LTD,SELL,58971,261.62,-
18-AUG-2008,VITLINFO,Vishal Information Techno,PRASHANT JAYANTILAL PATEL,SELL,143614,263.03,-
18-AUG-2008,VITLINFO,Vishal Information Techno,R.M. SHARE TRADING PVT LTD,SELL,230992,261.38,-
18-AUG-2008,VITLINFO,Vishal Information Techno,SMC GLOBAL SECURITIES LTD.,SELL,101836,259.93,-
18-AUG-2008,VITLINFO,Vishal Information Techno,TRANSGLOBAL SECURITIES LTD.,SELL,161018,262.08,-
18-AUG-2008,VITLINFO,Vishal Information Techno,YUVAK SHARE TRADING PVT LTD,SELL,114264,259.42,-
Post Session Commentary - Aug 18 2008
The domestic market ended the day with losses after showing volatility throughout the day. Market opened on downbeat note tracking weak cues from the Asian markets and soon moved into the positive territory due to some buying in key stocks. But the same momentum was not maintained and market turned volatile with negative bias. Tough selling pressure led market remained weak during final trading hours and close in red. Weak Asian and European markets also fueled to negative sentiments. NSE Nifty ended below 4,400 mark and BSE Sensex below 14,600 level. From the sectoral front, most of the indices closed in red and among that, most of the selling was seen from Metal, Oil & Gas, Consumer Durable, Capital goods, Auto and Power stocks However, IT index was in limelight as witnessed most of the buying from this basket. The market breadth was positive as 930 stocks closed in green while 1668 stocks closed in red and 78 stocks remained unchanged.
The BSE Sensex closed lower by 78.52 points at 14,645.66 and NSE Nifty ended down by 37.65 points at 4,393.05. The BSE Mid Caps closed with losses of 41.62 points at 5,781.801 and Small Cap ended lower by 73.83 points 7,036.61. The BSE Sensex touched intraday high of 14,824.92 and intraday low of 14,600.65.
Lossers from the BSE are Hindalco (4.53%), Grasim Indus (4.52%), Reliance Com Ltd (2.71%), M&M Ltd (2.56%), ACC Ltd (2.52%), Reliance (2.21%), Tata Steel (2.14%), JP Associates (1.86%) and ITC Ltd (1.83%).
The Metal index closed down by 229.73 points at 12,364.17. Lossers are Hindalco (4.53%), Jai Corp Ltd (3.92%), Ispat Indus (3.92%), Jindal Saw (2.58%), Steel Authority (2.47%), and Tata Steel (2.14%).
The Oil & Gas index ended down by 200.44 points at 9,996.61. As Gail India (5.56%), HPCL (3.63%), Reliance Pet(3.15%), Essar Oil Ltd (2.97%), Reliance Nat Res (2.67%) and Aban Offshore (2.43%) closed in negative territory.
The BSE Capital Goods index dropped by 50.15 points at 12,132.00. Major lossers are Aiaengineer (3.70%), Reliance Industrial Infra (3.46%), Suzlon Energy (3.17%), ABBLtd (3.12%), Crompton Greaves (2.96%) and Lakshmi Ma W (2.66%).
The BSE Auto index lost 50.39 points to close at 3,882.66. Major losers are Amtek Auto (3.69%), M&M Ltd (2.56%), Bajaj Auto (1.66%), Tata Motors (1.61), Bharat Forge (1.59%) and Maruti Suzuki (1.44%).
The BSE Power index closed lower by 40.28 points at 2,608.35. Lossers are Lanco Infra (5.12%), Suzlon Energy (3.17%), ABB Ltd (3.12%), Crompton Greaves (2.96%), Siemens Ltd (2.25%), and Torrent Power (1.89%).
The BSE IT index ended higher by 29.42 points at 5,199.20. As Rolta India (5.10%), Moser Bayer (3.76%), Rolata India (1.75%), Satyam comp (1.75%), TCS Ltd (1.24%) and Infosys Tech (0.77%), Wipro Ltd (0.64%) closed in positive territory.
Nifty August 2008 futures at premium
Turnover drops
Nifty August 2008 futures were at 4407, at a premium of 13.95 points as compared to spot closing of 4393.05. NSE's futures & options (F&O) segment turnover was Rs 39,680.22 crore, lower than Rs 47,643.15 crore on Thursday, 14 August 2008.
Reliance Industries August 2008 futures was the most active contract with turnover of Rs 833.37 crore. The contract was at 2240, a premium compared to the spot closing of 2225.
Reliance Capital August 2008 futures were at premium at 1290.50 compared to the spot closing of 1282.70.
However Larsen & Toubro August 2008 futures were at a slight discount at 2696, compared to the spot closing of Rs 2697.
In the cash market, the S&P CNX Nifty lost 37.65 points or 0.85% at 4,393.05
Sensex down 858 points in four trading sessions
The market extended last week’s losses today with Sensex declining nearly 860 points in the last four trading sessions. The market moved between positive and negative zone today.
Reliance Industries dropped. Ambuja Cements fell more than 5%, Hindalco Industries and Grasim Industries fell more than 4.5% each. HDFC spurted. European markets edged higher after weak start. Asian markets which opened before Indian market were mostly in the red.
The BSE 30-share Sensex ended down 78.52 points or 0.53% to 14,645.66. The key benchmark indices had recovered after opening weak dampened by latest economic data which showed India’s wholesale price index rose to a 16-year high. At day’s high of 14,824.92 hit in mid-morning trade, the index gained 100.74 points. At the day’s low of 14,600.65, the Sensex lost 123.53 points in late trade.
The S&P CNX Nifty was down 37.65 points or 0.85% to 4,393.05.
Sensex has lost 858.26 points or 5.86% from a recent high of 15503.92 hit on 11 August 2008. The barometer index is down 5641.33 points or 27.8% in the calendar year 2008 so far from its close of 20,286.99 on 31 December 2007. It is 6,561.11 points or 30.93% away from its all-time high of 21,206.77 struck on 10 January 2008.
The BSE clocked a turnover of Rs 3,832 crore today as compared to a turnover of Rs 4,882.32 crore on Thursday 14 August 2008.
Nifty August 2008 futures were at 4,409.25, a premium of 16.2 points as compared to spot closing of 4393.05. NSE's futures & options (F&O) segment turnover was Rs 39,680.22 crore, lower than Rs 47,643.15 crore on Thursday, 14 August 2008.
As per provisional figures on BSE, foreign institutional investors sold shares worth Rs 475.50 crore today, 18 August 2008 and domestic funds bought shares worth Rs 128.91 crore.
The BSE Mid-Cap index was down 0.71% to 5,781.80 and the BSE Small-Cap index was down 1.04% at 7,036.61.
BSE IT index (up 0.75% to 3,926.38), BSE Teck index (down 0.13% to 3,052.49), BSE Bankex (down 0.25% to 6,885.37), BSE HealthCare (down 0.34% to 4,267.34), BSE Capital Goods index (down 0.41% to 12,088.57) outperformed Sensex.
BSE Oil & Gas index (down 1.97% to 9,996.61), BSE Metal index (down 1.82% to 12,364.17), BSE Power index (down 1.52% to 2,608.35), BSE Auto index (down 1.28% to 3,882.66), BSE Consumer Durables index (down 1.13% to 3,828.18), BSE FMCG index (down 0.7% to 2,178.20), BSE PSU index (down 0.63% to 6,942.30) and BSE Realty index (down 0.62% to 5,131.61) underperformed Sensex.
The market breadth was negative on BSE with 930 shares advancing as compared to 1,668 that declined. 78 shares remained unchanged.
India’s largest private sector firm by market capitalisation and oil refiner Reliance Industries fell 2.21% at Rs 2,224.95.
Public sector oil marketing fell as crude oil price bounced back from a recent low. BPCL (down 2.25% to Rs 309.05), Indian Oil Corporation (down 0.64% to Rs 437.75) and HPCL (down 3.63% to Rs 215) edged lower.
Bank stocks were mixed after subdued start even as high inflation raised concerns of further monetary tightening by the Reserve Bank of India. India’s second largest private sector bank in terms of net profit HDFC Bank rose 2.14% to Rs 1,200.40. It recovered from the session’s low of Rs 1,163. India’s largest private sector bank by net profit ICICI Bank fell 1.23% to Rs 665. India’s largest commercial bank State Bank of India fell 0.03% to Rs 1,457.75. It recovered from the session’s low of Rs 1,425.
India’s largest dedicated home loan lender by operating income HDFC rose 3.12% to Rs 2,359.75.
Inflation as measured by wholesale price index rose 12.44% in the week to 2 August 2008, a 16-year high propelled by rise in the cost of pulses, fruits, spices and aviation turbine fuel. Inflation increased at a rate of 12.01% in the previous week. High inflation will mean that tight monetary policy stance by the central bank may continue.
IT stocks jumped as rupee weakened further against the dollar. BSE IT index rose 0.63% to 3,921.40 and was the major gainer from the sectoral indices on BSE. Satyam Computer Services (up 1.75% to Rs 419.10), Infosys (up 0.77% to Rs 1,702.40), Wipro (up 0.64% to Rs 431.90) and Tata Consultancy Services (up 1.24% to Rs 841.80) edged higher.
India's rupee fell for a fifth day, the longest losing streak in more than eight months, on speculation refiners stepped up purchases of crude oil.
Metal stocks fell. India’s largest aluminum producer by sales Hindalco Industries fell 4.53% to Rs 129.65. The company has fixed the price of its rights issue at Rs 96 per share, at a premium of Rs 95 per share. The equity shares are of a face value of Rs 1 per share. The board of directors of the company at its meeting on Thursday fixed the ratio of rights entitlement at three equity shares for every seven equity shares held by the shareholders. The record date for the rights issue has been fixed as 5 September 2008, a company release said.
Steel Authority of India (down 2.47% to Rs 139.95), Tata Steel (down 2.14% to Rs 603), Sterlite Industries (down 1.43% to Rs 611.35), National Aluminum Company (down 0.1% to Rs 392.20) edged lower.
Grasim Industries (down 4.52% to Rs 1,963.50), Ambuja Cements (down 5.37% to Rs 80.15), ACC (down 2.52% to Rs 594.40), edged lower from the Sensex pack.
Larsen & Toubro (up 1.29% to Rs 2,694.95), ONGC (up 0.73% to Rs 1,074.20), Hindustan Unilever (up 1.19% to Rs 241.75), edged higher from the Sensex pack.
India’s second largest telecom services provider by sales Reliance Communications was down 2.71% to Rs 412.40. The company added 1.75 million wireless users in July 2008, taking its total user base to 52.5 million, the company said on Thursday, 14 August 2008.
India’s largest tractor maker by sales Mahindra & Mahindra down 2.56% to Rs 568.10 . The company said today it would take a 51% stake in a joint venture with a Chinese firm and the ventrue would acquire the latter's tractor operations for $50 million.
Reliance Natural Resources clocked the highest volume of 1.49 crore shares on BSE. Reliance Petroleum (83.55 lakh shares), Vishal Information Technologies (75.34 lakh shares), Kaashyap Technologies (62.19 lakh shares) and IFCI (53.59 lakh shares) were the other volume toppers in that order.
Reliance Capital clocked the highest turnover of Rs 225 crore on BSE. Reliance Industries (Rs 199.36 crore), Vishal Information Technologies (Rs 197.05 crore), Reliance Natural Resources (Rs 144.15 crore) and Reliance Petroleum (Rs 132.52 crore) were the other turnover toppers in that order.
Asian markets were trading lower today, 18 August 2008. China's Shanghai Composite, Hong Kong's Hang Seng, Taiwan's Taiwan Weighted, Singapore's Straits Times, South Korea's Seoul Composite were down by between 0.28% to 5.34%. However, Japan's Nikkei rose 1.12%.
In Europe, France’s CAC 40, Germany’s DAX and UK’s FTSE 100 were up between 0.37% to 0.95%.
US markets ended mixed on Friday, 15 August 2008. The Dow Jones Industrial Average advanced 43.97 points, or 0.38%, to 11,659.90. The S&P 500 index gained 5.26 points, or 0.41%, to 1,298.20. However the Nasdaq Composite index declined 1.15 points, or 0.05%, to 2,452.52.
Indian government on Thursday, 14 August 2008, said private pension funds would be allowed to invest 15% of their assets in stock markets from 1 April 2009, from the current 5%. Non-government pension funds will be allowed to invest up to 55% of the assets in federal, state and debt mutual funds.
Trading Calls - Aug 18 2008
Nifty (4431) Sup 4350 Res 4490
Sell RNRL (97) SL 100
Target 92, 90
Sell SBI (1455) SL 1475
Target 1415, 1400
Sell Hero Honda (784) SL 792
Target 770, 765
Buy Sesa Goa (175) SL 170
Target 185, 187
Buy GAIL (417) SL 412
Target 425, 428
Pre Session Commentary - Aug 18 2008
The Indian Market is expected to have negative opening on weak global cues as Asian markets are trading mixed. Domestic markets were closed on Friday for the Independence Day holiday. On Thursday, the market witnessed a sharp fall during the trading and closed with heavy losses. The domestic market opened weak tracking cues from the global markets. Further market continued to lose ground ahead of inflation data for the weak ended 2nd August 2008. India''s inflation, stood at 12.44% for the week ended 2nd August 2008 as against 12.01% of the previous week. Market tried to recover during the mid session but was not able to sustain the momentum and continued to slip further till end. From the sectoral front, most of the indices remained out of favour and among that Reality index closed with deep cut of more around 8%. Along with that Bank stocks lost more than5% followed by Capital Goods, Oil & Gas, Power and Auto stocks who also witnessed heavy selling from these baskets. However, IT index was able to gain the market favor. The BSE Sensex closed lower by 368.94 points at 14,724.18 and NSE Nifty ended down by 98.35 points at 4,430.70. The BSE Mid Caps and Small Caps closed with losses of 105.95 points and 119.33 points at 5,823.42 and 7,110.44 respectively. We expect that market may extend its losses during the trading session.
India''s inflation, based on the wholesale price index jumped to 16 year high at 12.44% for the week ended 2nd August 2008 as against 12.01% of the previous week. This rise is mainly due to rising fuel and food prices. The food articles index and fuel price index went up 0.9%.
On Friday, the US market was closed mixed. Crude oil shed more than 1% to settle below $114 per barrel The Dow Jones Industrial Average (DJIA) advanced by 43.97 points to close at 11,659.90. The S&P 500 (SPX) index increased by 5.27 points to close at 1,298.90 while the NASDAQ Composite (RIXF) fell 1.15 points to close at 2,452.52.
Indian ADRs also ended mixed. In technology sector, Infosys ended higher by (0.35%) while Patni Computers dropped by (3.06%) along with Satyam by (1.25%) and Wipro by (0.51%). In banking sector, HDFC bank gained (0.82%) while ICICI bank lost (0.95%). In telecommunication sector, MTNL dropped by (1.91%) while Tata Communication remained unchanged. However, Sterlite dedustries increased by (2.10%).
Today the major stock markets in Asia are trading Mixed. Japan’s Nikkei is trading higher by 231.06 points at 13,250.47 while Taiwan Weighted trading down by 91.65 points at 7,104.85, Hang Seng index trading 21,073.14 dropped by 87.44 points and Singapore''s Straits Times is down by 5.82 points at 2,791.68.
The FIIs on Thursday stood as net seller in equity. The gross equity purchased was Rs1,928.60 Crore and the gross debt purchased was Rs0.00 Crore while the gross equity sold stood at Rs2,574.90 Crore and gross debt sold stood at Rs0.00 Crore. Therefore, the net investment of equity reported was (Rs646.30) Crore and net debt was Rs0.00 Crore.
The Indian rupee fell to its lowest in a month on Thursday due losses in stock market. The partially convertible rupee ended at 43.01/02 per dollar 1% weaker than Wednesday''s close of 42.65/66.
Today, Nifty has support at 4,313 and resistance at 4,501 and BSE Sensex has support at 14,320 and resistance at 15,022.
Daily Call - Aug 18 2008
More Indians would be watching the boxing arena in Beijing than what’s happening on the market ring, as the Bhiwani lads box their way to a medal or simply glory. Though the cues from the international markets are positive, our markets may not be able to benefit much as the local inflation numbers that came on Thursday, after the markets closed for the long weekend, are incapable of giving solace to the markets.
Should the markets provide an early bounce, it should be taken with both hands to lighten commitments, specially in the banking and other interest rate sensitive sectors like Real Estate, Construction and others. During the course of the week, we expect that the NSG meeting will fail to produce a nod for India and may need a second meeting in September, which may limit the upside potential of the current series.
Market may exhibit volatility
Mixed Asian markets in opening trades and presence of intra-day volatility may hold the investors from taking any fresh positions. However, the crude priced moved down sharply in last week and also flat in US markets on Friday may help the market to move northwards. Among the indices, the Nifty could test higher levels around the 4,460, while on the downside it has a key support at 4,400. The Sensex has a likely support at 14,650 and may face resistance at 14,800.
US indices closed flat on Friday, with the Dow Jones gaining 44 points at 11660 and the Nasdaq slipping by a points at 2453.
Indian ADRs had a mixed outing on the US bourses. Among the major gainers Rediff gained above 12% followed by Infosys, Dr Reddy, HDFC Bank and Tata Motors that raised over 0.50% each. Patni Computer, ICICI Bank, Satyam, MTNL and Wipro lost 1-3% each.
Crude oil prices slipped marginally, while the Nymex light crude oil for September delivery slipped by $1.24 to close at $113.77 a barrel. In the commodity segment, the Comex gold for December series lost $22.40 to settle at $792.10 an ounce.
Runaway inflation at 16-year high may trigger lower opening
Key benchmark indices are poised for lower opening today dampened by latest economic data which showed India’s wholesale price index rose to a 16-year high. Global cues were mixed.
Inflation as measured by wholesale price index rose 12.44% in the week to 2 August 2008, a 16-year high propelled by rise in the cost of pulses, fruits, spices and aviation turbine fuel. Inflation increased at a rate of 12.01% in the previous week. Inflation is expected to accelerate further after the Prime Minister Manmohan Singh's cabinet on 14 August 2008 approved an average 21% salary increase for about 50 lakh government employees. The higher wages will cost the government Rs 3.38 lakh crore this year.
The Prime Minister added that various steps are being taken to bring inflation under reasonable control. He blamed the surge in prices to a 16-year high this month on higher global costs of fuel and food.
Meanwhile the Finance Ministry allowing private sector managed provident fund and superannuation trusts to have greater exposure in the stock markets, may boost the sentiment. They can invest up to 15% of their investible funds in shares on which derivatives are available in the BSE or NSE.
US light crude for September delivery rose 23 cents to $114 a barrel today, 18 August 2008 as investors eyed the potential supply threats Tropical storm Fay poses to oil and gas production from the Gulf of Mexico.
Asian markets were trading lower today, 18 August 2008. China's Shanghai Composite fell 1.65% or 40.42 points at 2,410.19, Hong Kong's Hang Seng slipped 0.41% or 87.44 points at 21,073.14, Taiwan's Taiwan Weighted lost 1.27% or 91.65 points at 7,104.85, Singapore's Straits Times was down 0.21% or 5.82 points at 2,791.68, South Korea's Seoul Composite dropped 0.21% or 5.82 points at 2,791.68. However, Japan's Nikkei rose 1.77% or 231.06 points at 13,250.47
US markets ended mixed on Friday, 15 August 2008. The Dow Jones Industrial Average advanced 43.97 points, or 0.38%, to 11,659.90. The S&P 500 index gained 5.26 points, or 0.41%, to 1,298.20. However the Nasdaq Composite index declined 1.15 points, or 0.05%, to 2,452.52.
Back home, the BSE 30-share Sensex declined 368.94 points or 2.44% to 14,724.18 and the S&P CNX Nifty fell 98.35 points or 2.17% to 4430.70 on Thursday, 14 August 2008. Stock exchanges were closed on Friday, 15 August 2008, on account of Independence Day.
Foreign institutional investors (FIIs) were net equity sellers worth Rs 573.98 crore while mutual funds purchased shares worth Rs 23.32 crore on Thursday, 14 August 2008, according to provisional data on NSE.
FIIs were net sellers of Rs 675.88 crore in the futures & options segment on Thursday, 14 August 2008. They were net sellers of index futures to the tune of Rs 859.46 crore and purchased index options worth Rs 379.44 crore. They were net sellers of stock futures to the tune of Rs 223.28 crore and purchased stock options worth Rs 27.43 crore.
Morning Call - Aug 18 2008
Market Grape Wine :
In House:
Nifty at a support of 4405 and 4345 with resistance at 4475 and 4522 levels.
Cash: Buy GMR INFRA above 107 targets 115 with S/L 103.
Cash: Sell REL CAPITAL Below 1322 target 1275 with S/L 1342
Future: Buy ROLTA above 311 target 325 with S/L 300
Future: Sell RNRL below 99 targets 91 with S/L 104.
Out House:
Markets at a support of 14523 & 14291and resistance at 14876 & 15051 levels .
Buy : Satyam &Aptech
Buy : Infy
Buy : Coreproject
Buy : Adalbs & OPTO
Buy : IOC & HP
Buy : Bharti
Buy : IBreal
Buy : SBIN
Dark Horse : Tisco , OPTO , IBreal , RIL & EssarOil & Sbin
Significant losses for bullion metals
Gold and silver prices reach new lows not seen in this year
Gold and silver prices once again fell on Friday, 15 August, 2008 due to a strong dollar. Prices also slipped due to the slipping crude prices. Bullion metals also registered substantial losses for the week. Barring one day in between, gold and silver prices had registered losses in all the trading sessions in the current month of August, 2008 and had shed 14.4% in this month. Silver prices also fell for the day.
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. 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 and vice versa.
Comex Gold for December delivery fell $22.4 (2.8%) to close at $792.1 ounce on the New York Mercantile Exchange. It fell to an intra day low price of $784. For the week, it gave up 8.4%. With this, it lost 14.4% in August, 2008 till date. Last week, it had ended lower by 5.8%. On 17 March, 2008 prices had skyrocketed to a high of $1,034/ounce. But prices have dropped significantly since then.
This year, gold prices have lost 5.6% till date as the dollar rallied against the euro. It has lost almost $130 in August till now. Gold ended July, 2008 lower by $11 (1.1%).
Prior to that, the yellow metal ended second quarter with a marginal gain of 0.7%. It ended June, 2008 with a gain of 4.1%. In May, it ended with a gain of higher by $22.5 (2.5%). Before May, in 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 September delivery fell $1.415 (9.9%) to $12.815 an ounce. With today’s drop silver has lost almost 15% in 2008 till date. For the week, it gave up 16.4%. It ended July 2008 with a gain of 3%. For the second quarter, it had gained a paltry 1.4%. Silver had gained 16% in Q1. The metal also had gained for seven straight years.
Gold and silver prices have dropped 25% and 40% from their all time highs that they reached earlier this year.
At the currency markets on Friday, the dollar's rally extended to a six-month high on as traders continued to react to data showing the economies of five of the Group of Seven industrialized nations contracted during the second quarter. The dollar index, which measures the greenback against a basket of currencies, rose to 77.16 from 76.65 in the previous day.
In economic news on Friday, the Federal Reserve reported that the output of U.S. factories rose 0.4% in July, the best gain in 10 months.
Separately, the New York Federal Reserve Bank reported that manufacturers in New York state said business improved slightly in early August. The Empire state index rose to 2.8 in August from negative 4.9 in July.
At the crude market on Friday, crude-oil futures closed lower for a second session to tally a weekly loss of more than 1%, as moves in the foreign-exchange market triggered broad losses in dollar-denominated commodities. Consumption remained a key concern, as a report from a group of key oil producers showing that the slowing U.S. economy and high oil prices have hurt overall oil demand. Crude for September delivery lost $1.24, or 1.1%, to close at $113.77 a barrel on the New York Mercantile Exchange.
Earlier this year, the weakening dollar and higher global demand for raw materials had led to records this year for commodities including gold. Gold reached a record in March as a U.S. housing slump and credit crisis spurred the Federal Reserve to slash borrowing costs. The Federal Reserve halted cuts to its target bank lending rate in April, after slicing it in seven steps to 2% from 5.25% in September.
Gold had witnessed the greatest annual gain in twenty eight years by gaining $200/ounce (31%) in FY 2007 as lower interest rates had sent the dollar tumbling, and crude-oil prices rose to a record. Silver had climbed 16% in FY 2007. In 2006, silver had jumped 46% while gold gained 23%.
Crude continues to slip
Prices register more than 1% drop for the week
Crude oil prices fell on Friday, 15 August, 2008 at Nymex after dollar continued to remain strong. A report regarding overall US demand getting hurt due to higher prices also was reflected in the falling prices. Prices also slipped after the weekly inventory report by the Energy Department on last Wednesday showed that crude and crude product supplies declined bigger than expected last week.
Crude-oil futures for light sweet crude for September delivery closed at $113.77/barrel (lower by 1.24 or 1.1%) on the New York Mercantile Exchange. For te week, crude prices ended lower by 1.2%. Before that crude lost $15.92 (11%) in July, 2008, the biggest ever in dollars. Prices are 60% higher than a year ago.
In a monthly oil report issued on Friday, the Organization of the Petroleum Exporting Countries (OPEC) said that oil demand has been "badly hurt" this summer by the slowing economy and high oil prices. Transport and industrial fuels declined the most, sending USA’s total oil demand down by 3.8%, or 0.8 million barrels per day in the first seven months of the year.
Last Wednesday, 13 August, EIA reported that crude supplies fell 316,000 barrels to 296.5 million barrels for the week ended 8 August, 2008. Supplies were expected to rise by 300,000 barrels. Refinery utilization dropped to 85.9% of capacity, from 87% a week earlier. EIA also reported that motor gasoline supplies fell by 6.4 million barrels to 202.8 million and distillate stocks were down 1.7 million barrels at 131.6 million barrels.
OPEC, on Friday, reported that it expects total world oil demand to reach an average of 86.90 million barrels per day for 2008, above 2007's 85.90 million. For 2009, it forecasts a rise of 900,000 barrels per day to average 87.8 million. OPEC members have also been increasing production to help calm the markets. OPEC output in July reached 32.64 million barrels per day, a gain of 780,000 barrels per day since April.
At the currency markets on Friday, the dollar's rally extended to a six-month high on as traders continued to react to data showing the economies of five of the Group of Seven industrialized nations contracted during the second quarter. The dollar index, which measures the greenback against a basket of currencies, rose to 77.16 from 76.65 in the previous day.
Earlier last week, the International Energy Agency today reported that tight global oil demand and supply balance, which has helped push up crude prices to record highs, is easing as higher prices and slower economic growth in developed countries is curbing oil demand. Despite that, IEA inched up its 2009 demand estimate for oil products while keeping its 2008 view unchanged. For this year, it estimates oil demand rising 0.9% to 86.9 million barrels of oil a day. For 2009, it estimates rising 1.1% to 87.8 million barrels. In a separate report, the U.S. Energy Department's Information Administration lowered its outlook for oil prices, citing slower demand growth and rising production capacity.
Crude prices had gained 38% in the second quarter of this year. It was the biggest quarterly increase in nine years. It ended June 2008 higher by 9.9%. For the year, crude is up by 16% till date.
Against this background, September reformulated gasoline fell 5.2 cents, or 1.8%, to close at $2.8602 a gallon, but September heating oil recovered to add 2 cents, or 0.7%, to close at $3.1191 a gallon.
Stress starts again!
Reality is the leading cause of stress amongst those in touch with it.
We may have had a long weekend, but the reality is that the fresh spike in inflation, coupled with concerns over economic slowdown could offset positives such as falling oil prices. We are in for a rollercoaster week after the three-day weekend. Bulls and bears will continue their battle for supremacy. Though the bulls do have an edge at this stage, we cannot rule out a comeback by the bears going by last week's sudden reversal in trend. The key indices may witness sideways movement this week, as there are no clear signs on the market's immediate direction. Rate sensitive sectors like banks and realty will come under pressure after inflation rose to a 16-year high.
The market will face resistance at every rise amid persistent worries over weak macro-economic factors. Inflation will continue to be the biggest bugbear for not only India, but for the entire world. Major economies are slowing and are staring at a potential recession, even as inflation continues to rise. The only encouraging aspect right now is the recent correction in commodity prices, as the dollar has strengthened against its major rivals. This trend could continue in the foreseeable future, which will keep the bulls cheerful. But, the flip side is that falling commodity prices is also a pointer to softening demand amid economic downturn.
So, there is a possibility that fundamentals may again catch up with the markets, and stocks might resume their slide after a while. For the day, we expect a cautious to weak start and a choppy day. A technical bounce back is not ruled out though after Thursday's steep losses. But, one should be careful in building fresh long positions.
Adhunik Metaliks is one of the stocks that could rally as it is coming out with an IPO of its subsidiary, Orissa Manganese & Minerals Ltd. RCOM might be under some pressure amid reports that it has put on hold the proposed IPO of its tower infrastructure arm Reliance Infratel.
FIIs were net sellers to the tune of Rs5.74bn (provisional) in the cash segment on Thursday. Local institutions were net buyers of Rs233.2mn. In the F&O segment, the foreign funds were net sellers at Rs6.76bn. On Wednesday, the foreign funds were net sellers of Rs6.46bn.
Asian stocks advanced for the first time in five days, led by industrial and materials companies, after analysts raised their ratings for Komatsu and Sumitomo Metal Industries.
The MSCI Asia-Pacific Index added 1.2% to 126.39 as of 10:54 a.m. in Tokyo, halting a four-day, 3% drop. The index is down 20% this year as soaring inflation slowed global economic growth and the world's largest financial companies posted writedowns and credit losses of more than $500bn.
Japan's Nikkei 225 Stock Average added 1.7% to 13,240.95. Benchmarks rose in most other Asian markets open for trading except China. Indonesia and the Philippines are closed for holidays.
The Dow Jones Industrial Average and the S&P 500 index rose while the Nasdaq slipped on Friday in a choppy session. Oil prices flirted with three-month lows, the dollar rallied, and technology stocks declined.
The Dow and the S&P 500 both gained around 0.4% each while the Nasdaq finished nearly unchanged.
US light crude oil for September delivery touched a more than three-month low of $111.34 per barrel on the New York Mercantile Exchange, before recovering to settle at $113.77 per barrel, a loss of $1.24. Oil prices have plunged around 23% since peaking above $147 in mid-July. Other commodity prices have been falling too, including gold, silver, aluminum and platinum.
The selloff in crude oil over the last few weeks has had a mixed impact on US stocks. Weakness in the energy and financial space has overshadowed gains in other sectors like technology, retailers and consumer oriented stocks in the S&P 500.
The US dollar hit a two-year high on Friday versus the pound, and also gained against the euro and yen.
Ambac Financial and MBIA both gained after Standard & Poor's took the companies' bond insurance arms off negative watch and affirmed their AA ratings. The companies remain on "negative outlook."
Wachovia has agreed to buy back $8.5bn in auction-rate securities, joining four other banks that have settled with the New York attorney general.
Design software maker Autodesk reported higher sales and earnings that topped forecasts, and said third-quarter sales will beat expectations. Shares gained 11.7% in unusually active Nasdaq trade.
Retailers Kohl's, Nordstrom, Abercrombie & Fitch and JC Penney all reported earnings that were better than what analysts expected. JC Penney, however warned that current-quarter results won't meet forecasts.
In economic news, the August New York Empire State index, a regional read on manufacturing, showed a surprise jump vs. forecasts for a further slowdown. A separate report showed a rise in July capacity utilization that was in line with forecasts, as well as a rise in industrial production that was stronger than expected.
Another report showed the August consumer sentiment index from the University of Michigan rose to 61.7 from 61.2 in late July. Economists had forecast an improvement to 62.
COMEX gold for October delivery fell $22.30 to $788.40 an ounce. In the bond market, Treasury prices rose, lowering the yield on the benchmark 10-year note to 3.84% from 3.89% late Thursday.
A weaker euro helped European shares eke out marginal gains on Friday. The pan-European Dow Jones Stoxx 600 index rose 0.5% to 287.25, with euro-sensitive exporters leading the advance. The UK's FTSE 100 closed down 0.8% at 5,454.80, while Germany's DAX 30 inched 0.1% higher to 6.446.02, and the French CAC-40 gained 0.7% to 4,453.62.
In the emerging markets, Brazil's Bovespa rose 1.6% to 54,244 while Mexico's IPC added 0.3% to 27,340. The RTS index in Russia fell 0.55% to 1785 and the ISE National-30 index in Turkey was up 1.3% at 52,290.
Selling pressure may persist
Markets ended the week on a negative note posting third consecutive day of losses. Friday’s trading session was completely dominated by bears as weak global cues coupled with a sharp rise in crude oil prices dragged the markets. Heavy selling was witnessed in interest rates sensitive stocks like Realty, Banking and the Auto stocks. However, bucking the negative trend were the IT stocks on account of depreciating rupee. Finally, the benchmark Sensex dropped 358 points to close at 15,734 and Nifty ended 98 points lower to close at 4,430.
Sun Pharma gained by 1% to Rs1447 after the company announced that the U.S. Federal Trade Commission (FTC) granted early termination of the antitrust waiting period under the Hart-Scott-Rodino Act (HSR) for the previously announced Tender Offer by Alkaloida Chemical Company Exclusive Group Ltd. (Alkaloida), a subsidiary of Sun Pharma, for all outstanding Ordinary Shares of Taro Pharmaceutical Industries Ltd. (Taro). The scrip touched an intra-day high of Rs1454 and a low of Rs1430.
SBI declined by over 6% to Rs1458. The company announced that the Ministry of Finance: Department of Financial Services, Government of India passed an order for acquiring of State Bank of Saurashtra. This will come into effect on the effective date as may be notified by the Govt. of India in the official Gazette. The scrip touched an intra-day high of Rs1550 and a low of Rs1453 and recorded volumes of over 7,00,000 shares on BSE.
Shares of Hindustan Zinc slipped by 1% to Rs554 after the company announced that it cut Zinc prices by Rs2,400 per ton to Rs81,100 per ton and reduced Lead prices by Rs10,500 per ton to Rs90,400 per ton. The scrip touched an intra-day high of Rs570 and a low of Rs550 and recorded volumes of over 17,000 shares on BSE.
BILT edged lower by Rs33. Media reports stated that it would raise prices of uncoated paper by 2% or Rs800 per ton from September 1 to offset input cost push and on firm demand.
The company will also increase prices of the coated variety, used in premium magazines, photographs and packaging, by 3 % or Rs 1,500 a tonne from Aug 15, reports added. The scrip touched an intra-day high of Rs34 and a low of Rs33 and recorded volumes of over 1,00,000 shares on BSE.
I-Flex ended 1.3% higher to close at Rs1340 after the company announced that Bank SNORAS, a leader in the retail banking sector in Lithuania chose FLEXCUBE Universal Banking release 10.0 as the core banking solution for managing business processes and services in the Bank SNORAS group. The scrip touched an intra-day high of Rs1365 and a low of Rs1325 and recorded volumes of over 34,000 shares on BSE.
Essar Shipping was down by 4% to Rs109. The company announced that it has added two modern Supramax Dry Bulk Carriers to its fleet. The two ships named 'M V Malathi' and 'M V Malavika' are dedicated to perform a Contract of Affreightment (COA) of three million tonnes of coat over a period of five years.
The additions of these two ships will lift the Company's EBITDA by US$ 100 million over a period of five years. The scrip touched an intra-day high of Rs116 and a low of Rs109 and recorded volumes of over 49,000 shares on BSE.
Shares of Global Vectra declined by 3.5% to Rs73. The company clarified that it has not discussed / informed about "Stake Dilution" and the company deny any such statement by the company. The scrip touched an intra-day high of Rs83 and a low of Rs71 and recorded volumes of over 1,00,000 shares on BSE.
ICICI Bank decides to introduce floating rates of interest for two-wheelers.(BS)
Jindal Steel and Power to invest Rs183bn in Chattisgarh to set up a steel unit and a 1,000MW captive power plant.(DNA)
Assessment of commerciality and development plan of Gujarat State Petroleum Corp. KG Basin gas find is likely to be completed by next month.(BL)
Essar Oil has said its exploration blocks in Vietnam and Madagascar have shown an initial indication of gas reserves of 2-3tn cubic feet and around 1bn barrels of oil, respectively.(BS)
M&M plans to enter the US market with its diesel-powered trucks and SUVs.(ET)
Punj Lloyd, which is constructing two LNG tanks for Petronet LNG in Gujarat, may not meet its October deadline.(Mint)
Bharti Airtel says it has crossed the 75mn customer mark to become the fourth largest in-country mobile operator in the world.(FE)
Tata Steel has kicked off fresh talks to sell the aluminum smelting business of Corus Group.(ET)
Hotel Leelaventure plans to increase its room tariffs.(DNA)
Ispat Industries and Bhushan Steel out of the race to get the iron ore mines in Kawardha district of Chattisgarh.(BS)
Idea Cellular to launch wireless telephony services in Mumbai soon.(ET)
Tata Power, CESC, DLF, amongst others respond to the EOI floated by Andrew Yule to divest up to 57.2% in DPSC.(ET)
Indraprastha Gas and two other companies have asked oil regulator to reject Reliance Industries EOI for six cities.(ET)
Reliance ADAG lines up Rs1bn for advertising and promotional campaign for DTH roll-out.(ET)
Idea Cellular defers its open offer for an additional 20% stake in Spice Communications following a delay in approval.(FE)
Government plans to rope in DLF, Omaxe and Rahejas for Delhi slum redevelopment.(ET)
Goa-based Dempo Group plans to divest 40% in a company that will house its 100mn tonne iron ore reserve.(BS)
Fortis Healthworld will acquire pharmacy retail chain CRS Health as part of expansion.(Mint)
GSM operators to defy TRAI’s directive to give links to connect Reliance Communication’s new network by August 21.(BL)
Tata Power planning and studying a minimum US$3bn foray into nuclear power.(ET)
JSW Steel, which is setting up a 2mn tonne per annum coking coal facility in Mozambique, might not be able to complete its project on time.(DNA)
Seshasayee Paper and Boards plans to invest Rs3bn to double its printing writing paper production capacity to 225,000 tonnes. (BS)
GMR group plans two SEZs at Hyderabad airport.(TOI)
Country Club India has earmarked Rs2.5bn investment for its foray into the wellness tourism segment.(ET)
IFC weighing option to part-finance GSPC Gas Company’s US$140mn city gas distribution project in Gujarat.(FE)
ONGC will set up an integrated offshore supply base and processing unit in Andhra Pradesh.(BL)
PNB is in talks with Visa to start its independent credit card business and is likely to launch the service by October.(FE)
Reliance Industries looking at exporting diesel from its upcoming refinery at Jamnagar in Gujarat to Pakistan.(ET)
L&T in talks with Germany-based Voith to export paper machinery. (BL)
BHEL announced an investment of US$2.5bn in the next four years to ramp up capacity to meeting the growing electricity needs.(FE)
Indian Hotels has earmarked Rs18bn for funding inorganic growth in the next three years.(ET)
TRAI to ask DoT to take action against GSM operators if they fail to connect their networks to Reliance Communications GSM network by August 21, 2008.(ET)
Nuclear Power Corp. shortlists four suppliers for reactors.(BL)
Kingfisher Airlines plans to launch its first international flight on September 3.(ET)
Air India plans to save Rs10bn this fiscal by cutting operational costs.(Mint)
BSNL plans to offer bundled CDMA handsets.(ET)
BHEL is the best bidder in 2,400MW Debrand project of Tata Power and in the 1,050MW Orissa project of Monnet Ispat.(BL)
EIH plans to set up hotels in Bangalore and Goa for an investment of Rs6.5bn and has secured land in both the locations. (ET)
Economy Front page
Government may exempt value added steel from the purview of export duty if products out of imported raw material.(TOI)
DoT seeks PMOs approval to raise 2G spectrum usage charges for telecom operators.(ET)
DoT rejects Samajwadi Party leader's formula for levying a charge on GSM-based mobile operators with excess spectrum over 6.2MHz.(FE)
PSU general insurers may be allowed to tap market for additional funds.(DNA)
TRAI questions DoT’s mobile number portability methodology.(TOI)
Duty-free export of steel items may get government approval.(ET)
DoT says it is open to auctioning 3G spectrum for CDMA.(BS)
Hotels across cities to hike tariffs by 10-50%.(ET)
Excise duty waived for goods used in ultra mega power projects.(BL)
Indirect tax collection increase 13.5% YoY in July.(FE)
FDI in Q1 FY09 exceeds total inflows in 2005-06.(Mint)
Government has initiated a new scheme of generation based incentive (GBI) for wind power generation.(ET)
India Infrastructure Finance Company, the SPV floated by the government, will raise US$1.2bn from foreign lenders.(BS)
Cement prices are likely to go up in the next one or two months due to increasing input costs, especially in wages, salaries and coal.(BL)
A single excise duty will be levied on all foreign liquors, irrespective of the prices, in Maharashtra.(ET)
Government may sell 4mn tonnes of wheat to reduce prices.(BS)
CERC proposes a new tariff scheme for power generated from hydroelectric stations whereby the risks associated with changes in water flow would now be borne by producers instead of buyers.(BS)
World Bank will provide a US$600mn loan to India to part finance a $10.7bn education programme.(FE)
DoT invites proposals for 3G e-auction agency.(ET)
Government issues show cause notice to 252 sugar mills for failing to submit monthly returns regarding dismantling of sugar buffer stocks.(BS)
Exporters may have to settle for a lower duty drawback rates for 2008-09.(BL)
IRDA plans to frame guidelines for insurance companies’ valuation. (ET)
Commerce Ministry likely to propose reduction in iron ore export duty.(FE)
Ethanol producers are demanding double the current prices for the by-product.(DNA)
Government announced an average increase of 21% in salaries of 5mn government employees wef January 1, 2006.(FE)
Analyst Picks
Lanco Infratech
CMP: Rs 312.70
Target Price: Rs 564
BROKERAGE house ICICI Securities has maintained its ‘buy’ recommendation on Lanco Infratech with a price target
of Rs 343, but has lowered earnings estimates for FY09 and FY10 by 34% and 42%, respectively, citing slowdown in the
infrastructure space. “Slowdown in realty has led to 15-20% downgrade in selling prices across projects and increased the cost of equity, cost of debt and cap rates 200 bps each, implying 43% downgrade in real estate NAV to Rs 22 billion or Rs 100/share,” said the ICICI Securities note to clients.
“As per our funding analysis on Lanco (both debt and equity), we expect no funding risk for its upcoming power and real-estate projects. Despite earnings downgrade, Lanco enjoys healthy growth in construction orderbook, discounted valuations of power portfolio, strong earnings momentum and robust business model,” the note added.
Satyam Computer
CMP: Rs 411.90
Target Price: Rs 430
BROKERAGE house CLSA has reaffirmed its ‘underperform’ rating on Satyam saying it does not expect any spectacular financial performance by the IT services major. “We continue to be surprised by the lack of any positive commentary or data points on demand even into mid-August, with only three months left before the next budgeting cycle,” the CLSA note to clients said.
According to CLSA, Satyam commented that in April, its “stretch target” for growth in FY09 would have been 30% year-on-year (guidance of 24-26% Y-o-Y).
“But after the 1Q disappointment and continued demand uncertainty, this margin of safety has somewhat shrunk.
Our revenue growth forecast is currently 27%. With no breakout performance (relative to peers) indicated by financials, we expect the stock to reflect sector sentiment hereon,” the note added.
Unitech
CMP: Rs 169.35
Target Price: Rs 158
HSBC Securities has retained its ‘underweight’ rating on Unitech with a price target of Rs 158, as it feels further returns from current levels could be limited in the absence of any catalysts. The brokerage feels property prices will have to come down if demand has to pick up. “Residential segment occupies around 79% of the total saleable area and roughly 46% of the gross asset value. Within the residential space, a few cities hold a large exposure,
exposing Unitech to absorption and price risk in these markets,” the HSBC note to clients said.
“Agra and Varanasi would contribute around 35% of Unitech’s total retail development. Since these cities are currently too small to absorb such a large supply of retail space, we remain sceptical on the company’s retail plans in these two cities, the note added.
Hero Honda
CMP: Rs 692
Target Price: Rs 785.10
INDIA Infoline has recommended a ‘sell’ on Hero Honda, as it feels high interest rates could affect the company’s sales. “Although, Hero Honda (HHL) has been outperforming in the past 4-5 months, as Bajaj Auto pulled out of the 100-cc segment and TVS delayed the launch of kFlamem, we expect the industry concerns to catch up with HHL too, in near to medium term,” the brokerage said in a note to clients.
In order to improve asset quality and address problem of rising delinquencies, some key banks have discontinued or slowed down their auto loan business at the dealer end. With 60% of two-wheeler sales being financed, this move has seriously impacted industry fortunes.
“During Q1 FY09, HHL posted a 5% quarter-on-quarter jump in realisations. However, operating profit margins declined by 280 bps Q-o-Q, largely on account of rise in raw material cost. It also spent Rs 32 crore on advertising during the Indian Premier League. We expect margins to remain under pressure in coming quarters,” the note added.
IRB Infrastructure
IRB Infrastructure
Research: Lehman Brothers
Rating: Overweight
CMP: RS 160
Lehman Brothers initiates coverage on IRB Infrastructure Developers with an ‘overweight’ rating and a March ’09 price target of Rs 195. IRB is one of the largest road developers in India, and has 14 BOT road projects. The company’s key strength is its in-house construction capability that enables it to capture the entire economic value of road projects, and helps it to address execution risks. Historical projects have yielded substantially high-equity internal rate of return (IRR). IRB has strong cash flows and low leverage compared to other international road developers. Its operating cash flow is strong and will improve further after commissioning of the Bharuch-Surat and Surat-Dahisar stretches. Lehman estimates cash flows before capex at Rs 1,200 crore over FY09-11 .
The increase in cash flow is driven primarily by a rise in toll revenue. The net debt-to-equity ratio for IRB is only 0.9, and leverage is likely to remain comfortable at 1.3 in FY10. Lehman values IRB at: (1) Road concessions at Rs 129 per share; (2) Rs 36 per share as growth factor to account for potential new projects; (3) Construction business at Rs 26 per share based on a multiple of 10x FY10 earnings estimate of Rs 87 crore; and (4) Real estate at Rs 3 per share. The stock is currently trading at a multiple of 9.4x FY10 earnings estimate of Rs 520.5 crore and 2.1x FY10 book value of Rs 2,372 crore, and at a substantial discount to its global peers. The stock is currently trading at 1.08x concession portfolio NAV of Rs 4,293.8 crore, implying that not much value has been attributed to construction, real estate and future growth opportunities in road concessions.
Federal Bank
We recommend a sell in Federal Bank from a short-term perspective. From the charts of the Federal Bank it is clearly visible that after recording a 52-week low of Rs 163 in mid July, the stock was on an uptrend till Rs 232.
The stock could not get past the resistance at Rs 232 and formed a hanging man candlestick pattern. This pattern is a bearish reversal pattern, signalling short-term bearishness. Subsequently, the stock reversed by declining 4 per cent on August 14. The daily relative strength index has entered the neutral region after touching the overbought levels.
The stock is currently testing the short-term up trend-line and it is on the brink of penetrating this line. Our short-term forecast for the stock is bearish. We expect the stock to decline until it hits our price target of Rs 190 in the upcoming trading sessions. Traders with short-term perspective can sell the stock while maintaining a stop-loss at Rs 226.
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