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Wednesday, October 28, 2009
Astec Lifesciences IPO Analysis
Astec Lifesciences (Astec) has been promoted by Ashok Hiremath and Dr P L Tiwari. Ashok Hiremath has dissociated from his brother Jai Hiremath, who is a promoter of listed company Hikal. Astec is predominantly an agrochemicals player and operates in an extensively competitive agrochemicals and pharmaceutical industry, with major focus on the manufacture and sale of intermediates, active ingredients and formulations in the off-patent–proprietary category. Active ingredients are sold to crop protection formulators, whereas intermediates are supplied to technical grade product manufacturers and formulations are sold in bulk quantities to companies engaged in retail marketing. Astec's three manufacturing facilities, located at Dombivli (one unit) and Mahad (two units) in Maharashtra, have a total installed capacity of 2,800 tonnes. These facilities have been granted ISO 9001:2000 certificate of assessment by International Standards Certification Pty Limited, Australia, for "Design, Development, Manufacture and Supply of Organic Chemicals and Intermediates for Pharmaceutical and Agrochemical Industry".
Hexaconazole, Tebuconazole, Metalaxyl and Propiconazole are some of the key products of Astec in the agrochemical segment. These are generally used in crop protection. Dicap, one of the company's key pharmaceutical intermediate products, which is used in manufacture of antifungal agents. Triazole fungicides, which includes Hexaconazole, Tebuconazole, and Propiconazole is one of the company's major product in the agrochemical segment, and has contributed 65.81% of the total sales, whereas Dicap, a key product in pharmaceutical segment, contributed 14.14% in 2008-09. Besides enjoying a good pie of the domestic market, the company has been able to successfully venture into the international market as well, exporting its produce to countries like South Africa, Europe, USA, West Asia, East Asia, Japan and South America. The company plans to enter into long-term supply contracts with the buyers in these countries in order to scale up exports.
Astec's concerted effort to identify contract manufacturing as one of the options to maintain growth and profitability and also to undertake contract research and manufacturing (CRAMS) business will enable a predictable pattern of demand going ahead.
To further diversify and widen the product range besides increasing the existing capacity, Astec plans to expand its existing manufacturing facilities at Mahad at an estimated cost of Rs 32.56 crore. The company plans to add nearly 1,150 tonnes of agrochemicals and pharma intermediates to its existing capacity of 2800 metric tonnes. It further plans to expand its research & development centre at Dombivli at an estimated cost of Rs 2.55 crore by expanding its bench scale capabilities, improve analytical capabilities and expand its pilot plant. The proposed expansion will enable the company to carry out research on more complex molecules and to undertake contract research activities. In addition to this, Astec also plans to incur Rs 3.76 crore for both domestic and international product registration. All the capital expenditure would be financed from the proceeds of the initial public offering (IPO) and internal cash accruals.
Strengths-
* Has six diverse products comprising a mix of high volume-medium margin and low volume-high margin category, comprising different kinds of active ingredients, intermediates and formulations catering to the needs of a wide range of customers like agrochemicals manufacturers, pharmaceutical applications and also in manufacturing shampoos and disinfectants.
* Has a research & development (R&D) facility at Dombivli recognised by the Department of Science and Industrial Research, which has been able to develop processes for various new products like Tebuconazole, Propiconozole and Metalaxyl.
* Has existing 43 registrations in 20 countries where local firms/parties have obtained the registration on the basis of being the approved source of supply and three registrations in its own name, two in Australia and one in Vietnam. In addition to overseas registrations, has 69 CIB registrations for various products in the Indian market.
* Has a good mix of domestic and international sales mix with the exports and deemed exports together comprising 29.52% of the total revenue in the previous fiscal.
* Has managed to consistency achieve a higher capacity utilization level. The average capacity utilization was 85% in the past three years.
.Weaknesses-
* Operation dependent on agricultural production and monsoon. Disappointing and erratic monsoon in the current year is likely to have a negative impact on the demand for agrochemicals and other crop inputs.
* Does not have long-term supply agreements for supply of raw materials. Most of the raw materials required are imported. Hence, is vulnerable to volatility in international prices of the raw material and also currency rate fluctuations.
* Also does not have any long-term sales agreement, which is a trade practice in the chemicals intermediates and technical chemical business.
* The industry is a highly fragmented with competition from both the domestic as well as international manufacturers.
Valuation
The price band of Rs 77 to Rs 82 per equity share, translates into a PE of 12.2x at the lower price band and 13x at the higher price band based on FY 2009 EPS of Rs 6.3 on post-IPO equity. Near comparable companies Sabero Organics and Meghmani Organics are trading at a trailing 12- month PE of 4.4 and 6.1, respectively. Composite average TTM P/E for small/medium agrochemical companies is around 6.
Correction continues, Sensex down 70 points
It was again a day filled with high volatility wherein the market in intra-day's trade swung sharply by close to 300 points.While the market continued its losing streak and corrected marginally on the back of weak global cues and selling pressure in consumer durables, banking and public sector unit (PSU) stocks that lost over 1% each. The day started with the weak overnight US and European closing, while in today's trading, all the major Asian indices closed in red except for the Shanghai Composite that was marginally up. Even the European indices opened in negative and at the time of writing this report, it was trading with loss in the close to 1.70% each, while FTSE 100 is traded at 5108 with 93 points or about 1.80% loss.
The Sensex that opened gap-down at 16336 points, marginally lower by 17 points to its previous close. However, volatility gripped the market and it resulted in the Sensex recording a low of 16144 and a high of 16441 and at last closed by 0.43% lower at 16283. The Sensex once entered the positive zone owing to buying in the heavyweights, however owing to negative cues from the European markets resulted in the sliding of the Sensex from its day's high. Nifty lost 20 points to the end the day at 4826. The market breadth was negative as out of 2,757 stocks traded on the BSE, 1,059 stocks advanced, whereas 1,627 stocks declined. Seventy-one stocks closed unchanged.
Among the sectoral indices, BSE Realty gained the most and surged by 0.88%, followed by BSE TECk rose by 0.73%. BSE CD fell the most by 1.79% and was followed by BSE Bankex that slid by 1.50%. On the stocks’ front, Jet Airways jumped the most and surged by 8.80% to Rs398.00, followed by Balrampur Chini Mills that rose by 7.88% to Rs154.70 and PTC India that advanced 7.86% to Rs105.00. KSK Energy, Sesa Goa, Nagarjuna Construction Company and Crompton Greaves ended the day 6-7.5% higher. Among the losers, Everest Kanto fell the most by 15.90% to Rs153.15 followed by Lupin that fell by 6.29% to Rs1,172.20 and Educomp Solutions that lost 5.05% to quote at Rs876.45. Rolta India, Maruti Suzuki, and BEML declined above 4% each.
On the turnover front, Over 2.09 crore shares of Unitech changed hands on the BSE followed by Ispat Industries (1.13 crore shares), Suzlon Energy (0.71 crore shares), IFCI (0.61 crore shares) and Balrampur Chini Mills (0.56 crore shares).
Events outcome: Q2FY2010 earnings
Marico's top line surged by 14.7% in the quarter.
In the quarter under review, Tata Tea’s operating profit grew by 16.2%.
Sun Pharmaceutical Industries’ revenue went up by 50.5% sequentially in Q2FY2010.
India Cements’ bottom line declined by 10.9% in Q2FY2010.
Orbit Corporation’s net income rose by 81.7% in the quarter under review.
Shriram Transport Finance’s Q2 net rises by 25.26% in Q2.
HCL Technologies’ Q1 revenues grew by 4.2% sequentially.
ACC net profit rises 53.70% in the September 2009 quarter.
Jain Irrigation's net profit up 73.71% in Q2.
BSE Bulk Deals to Watch - Oct 28 2009
Deal Date Scrip Code Company Client Name Deal Type * Quantity Price **
28/10/2009 531337 CHAN GUIDE I ALTRA CLEAN OPERATIONS B 35010 86.43
28/10/2009 532363 COMP-U-LEARN RAMESH BABU P B 68162 35.75
28/10/2009 532363 COMP-U-LEARN RAMESH BABU P S 80139 35.75
28/10/2009 532363 COMP-U-LEARN K VENKATESWARLU S 74721 35.67
28/10/2009 517477 ELNET TECHNO SAINATH HERBAL CARE MARKETING P.LTD B 24121 65.29
28/10/2009 517477 ELNET TECHNO SAINATH HERBAL CARE MARKETING P.LTD S 33820 67.14
28/10/2009 533090 EXCEL INFO PARESH SANATKUMAR RACHH B 699734 72.52
28/10/2009 533090 EXCEL INFO PARESH SANATKUMAR RACHH S 677839 72.80
28/10/2009 513337 GUJ.TOOLROOM BLUEBERRY TRADING COMPANY PRIVATE LIMITED B 45900 11.55
28/10/2009 513337 GUJ.TOOLROOM NEVIL MUKESHBHAI PANCHAL S 50000 11.55
28/10/2009 532072 INTER DIGI NARENDRA VALLABHAJI BAHUVA B 297037 3.41
28/10/2009 523467 JAI MATA GLA Naman Securities & Finance Pvt. Ltd. B 285790 2.62
28/10/2009 523467 JAI MATA GLA BHAVIN Y MEHTA B 100000 2.62
28/10/2009 523467 JAI MATA GLA MOTI LAL BHASIN S 500000 2.62
28/10/2009 530255 KAY POW PAP BAMPSL SECURITIES LTD. B 63525 6.32
28/10/2009 530255 KAY POW PAP SATISH KUMAR GUPTA B 78300 6.45
28/10/2009 530255 KAY POW PAP BAMPSL SECURITIES LTD. S 57900 6.44
28/10/2009 530255 KAY POW PAP SATISH KUMAR GUPTA S 78300 6.37
28/10/2009 523475 LOTUS CHOC C VARIJA KAMATH B 85334 34.26
28/10/2009 533015 NUTEK INDIA MAVI INVESTMENT FUND LIMITED. B 174391 84.75
28/10/2009 533015 NUTEK INDIA BALYASNY SI LIMITED S 175000 84.75
28/10/2009 531496 OMKAR OVERSE SUMIT CHAMPALAL AGARWAL S 48890 58.95
28/10/2009 523483 PACIFIC INDU SUBASH CHAND AGARWAL B 8000 166.18
28/10/2009 523483 PACIFIC INDU YOGENDRA KUMAR BOHRA B 8000 169.70
28/10/2009 523483 PACIFIC INDU SUBASH CHAND AGARWAL S 8000 169.70
28/10/2009 523483 PACIFIC INDU YOGENDRA KUMAR BOHRA S 8000 166.18
28/10/2009 522087 SULZER INDIA BHARAT JAYANTILAL PATEL B 129087 690.00
28/10/2009 522087 SULZER INDIA FINQUEST FINANCIAL SOLUTIONS PVT. LTD. S 97642 690.01
28/10/2009 533121 THINKSOFT VIJETA BROKING INDIA PRIVATE LIMITED B 113361 206.38
28/10/2009 533121 THINKSOFT DEEPAK SHANTILAL CHHEDA B 91658 207.30
28/10/2009 533121 THINKSOFT AMIT MANILAL GALA B 94137 206.31
28/10/2009 533121 THINKSOFT GENUINE STOCK BROKERS PVT. LTD. B 264228 201.43
28/10/2009 533121 THINKSOFT PASHUPATI CAPITAL SERVICE PVT LTD B 81249 204.38
28/10/2009 533121 THINKSOFT TRANSGLOBAL SECURITIES LTD. B 413985 206.51
28/10/2009 533121 THINKSOFT A.K.G. STOCK BROKERS PVT. LTD. B 83064 206.10
28/10/2009 533121 THINKSOFT MBL & Co. LTD. B 62804 207.03
28/10/2009 533121 THINKSOFT SUNEET LAL B 82216 204.92
28/10/2009 533121 THINKSOFT YES INVESTMENT B 85000 203.38
28/10/2009 533121 THINKSOFT MATRIX EQUITRADE PVT. LTD. B 256538 204.57
28/10/2009 533121 THINKSOFT ALPESH JAYANTILAL PANDIT B 114344 197.31
28/10/2009 533121 THINKSOFT CHANDARANA INTERMIDIARY BROKERS PVT LTD B 88238 206.72
28/10/2009 533121 THINKSOFT MARWADI SHARES AND FINANCE LTD. B 173890 203.29
28/10/2009 533121 THINKSOFT EUREKA STOCK & SHARE BROKING SERVICES LTD B 146411 203.87
28/10/2009 533121 THINKSOFT SANJEEV SINGHAL B 310836 203.74
28/10/2009 533121 THINKSOFT OPG SECURITIES P LTD B 2233080 204.88
28/10/2009 533121 THINKSOFT MANSUKH STOCKS BROKERS LTD. B 56744 204.80
28/10/2009 533121 THINKSOFT R.M.SHARES TRADING PVT.LTD B 127368 205.25
28/10/2009 533121 THINKSOFT Naman Securities & Finance Pvt. Ltd. B 87783 201.06
28/10/2009 533121 THINKSOFT KRISHAN BAJAJ BAL B 78375 208.11
28/10/2009 533121 THINKSOFT NIMIT JAYENDRABHAI SHAH B 66710 201.44
28/10/2009 533121 THINKSOFT RAKHI KALPESH BHANDARI B 118961 206.82
28/10/2009 533121 THINKSOFT NAVEEN TAPARIA B 153255 207.27
28/10/2009 533121 THINKSOFT VIJETA BROKING INDIA PRIVATE LIMITED S 113361 206.25
28/10/2009 533121 THINKSOFT DEEPAK SHANTILAL CHHEDA S 91658 207.61
28/10/2009 533121 THINKSOFT AMIT MANILAL GALA S 94137 205.80
28/10/2009 533121 THINKSOFT GENUINE STOCK BROKERS PVT. LTD. S 264228 201.55
28/10/2009 533121 THINKSOFT PASHUPATI CAPITAL SERVICE PVT LTD S 81249 204.45
28/10/2009 533121 THINKSOFT MANISH VIRCHAND LAKHANI S 60933 205.94
28/10/2009 533121 THINKSOFT TRANSGLOBAL SECURITIES LTD. S 413985 205.97
28/10/2009 533121 THINKSOFT AANGI SHARES & SERVICES PVT. LTD. S 77107 207.83
28/10/2009 533121 THINKSOFT A.K.G. STOCK BROKERS PVT. LTD. S 83064 206.22
28/10/2009 533121 THINKSOFT MBL & Co. LTD. S 62804 206.43
28/10/2009 533121 THINKSOFT SUNEET LAL S 82216 204.32
28/10/2009 533121 THINKSOFT YES INVESTMENT S 85000 201.65
28/10/2009 533121 THINKSOFT NARENDRABHAI AMTRATLAL AMIN S 84110 209.63
28/10/2009 533121 THINKSOFT MATRIX EQUITRADE PVT. LTD. S 256538 204.82
28/10/2009 533121 THINKSOFT ALPESH JAYANTILAL PANDIT S 114344 208.67
28/10/2009 533121 THINKSOFT CHANDARANA INTERMIDIARY BROKERS PVT LTD S 87738 205.61
28/10/2009 533121 THINKSOFT MARWADI SHARES AND FINANCE LTD. S 173890 203.18
28/10/2009 533121 THINKSOFT EUREKA STOCK & SHARE BROKING SERVICES LTD S 146411 203.96
28/10/2009 533121 THINKSOFT SANJEEV SINGHAL S 310836 203.83
28/10/2009 533121 THINKSOFT OPG SECURITIES P LTD S 2233080 205.02
28/10/2009 533121 THINKSOFT MANSUKH STOCKS BROKERS LTD. S 56744 203.95
28/10/2009 533121 THINKSOFT R.M.SHARES TRADING PVT.LTD S 127368 205.24
28/10/2009 533121 THINKSOFT Naman Securities & Finance Pvt. Ltd. S 97178 200.25
28/10/2009 533121 THINKSOFT KRISHAN BAJAJ BAL S 78375 207.36
28/10/2009 533121 THINKSOFT NIMIT JAYENDRABHAI SHAH S 66710 215.08
28/10/2009 533121 THINKSOFT RAKHI KALPESH BHANDARI S 118961 208.24
28/10/2009 533121 THINKSOFT NAVEEN TAPARIA S 153255 206.11
28/10/2009 518051 VINAY CEME L JASMIT SINGH S 141785 45.23
28/10/2009 522080 VULCAN ENGIN NILESH VERSHI VORA B 25000 19.59
28/10/2009 531249 WELL PACK PA PANDYA YAMINIBEN M B 34151 273.92
28/10/2009 531249 WELL PACK PA PANDYA YAMINIBEN M S 32035 274.39
NSE Bulk Deals to Watch - Oct 28 2009
Date,Symbol,Security Name,Client Name,Buy/Sell,Quantity Traded,Trade Price / Wght. Avg. Price,Remarks
28-OCT-2009,BAJAJHIND,Bajaj Hindusthan Ltd,RELIANCE MUTUAL FUND-VISION FUND,BUY,975000,215.00,-
28-OCT-2009,EXCELINFO,Excel Infoways Limited,AMBIT SECURITIES BROKING PVT. LTD.,BUY,110864,73.10,-
28-OCT-2009,EXCELINFO,Excel Infoways Limited,JATIN LAXMIKANT TRIVEDI,BUY,489423,71.94,-
28-OCT-2009,EXCELINFO,Excel Infoways Limited,PARESH SANATKUMAR RACHH,BUY,223634,73.70,-
28-OCT-2009,ISPATIND,Ispat Industries Limited,JAYPEE CAPITAL SERVICES LTD.,BUY,10867266,20.88,-
28-OCT-2009,NATCOPHARM,Natco Pharma Limited,PVT LTD PASHA FINANCE,BUY,150000,114.47,-
28-OCT-2009,NUTEK,Nu Tek India Limited,MAVI INVESTMENT FUND LIMITED,BUY,174569,84.75,-
28-OCT-2009,SUJANATOW,Sujana Tower Limited,EUREKA CREDIT FINANCE PRIVATE LIMITED,BUY,1222313,57.24,-
28-OCT-2009,THINKSOFT,Thinksoft Global Ser Ltd,AANGI SHARES & SERVICES PVT. LTD,BUY,262176,199.11,-
28-OCT-2009,THINKSOFT,Thinksoft Global Ser Ltd,ADROIT FINANCIAL SERVICES PRIVATE LIMITED,BUY,67144,205.37,-
28-OCT-2009,THINKSOFT,Thinksoft Global Ser Ltd,ARCHITA C GADA,BUY,169419,207.12,-
28-OCT-2009,THINKSOFT,Thinksoft Global Ser Ltd,AUM SECURITIES PRIVATE LTD.,BUY,78344,202.73,-
28-OCT-2009,THINKSOFT,Thinksoft Global Ser Ltd,BHAVIN SURESH CHHEDA,BUY,67760,203.73,-
28-OCT-2009,THINKSOFT,Thinksoft Global Ser Ltd,BP FINTRADE PRIVATE LIMITED,BUY,340304,204.64,-
28-OCT-2009,THINKSOFT,Thinksoft Global Ser Ltd,C D INTEGRATED SERVICES LTD.,BUY,51131,209.92,-
28-OCT-2009,THINKSOFT,Thinksoft Global Ser Ltd,CHANDARANA INTERMEDIARIES BROKERS P. LTD,BUY,69048,205.19,-
28-OCT-2009,THINKSOFT,Thinksoft Global Ser Ltd,CHOKHANI SECURITIES LTD,BUY,74815,204.50,-
28-OCT-2009,THINKSOFT,Thinksoft Global Ser Ltd,CPR CAPITAL SERVICES LTD.,BUY,261946,206.26,-
28-OCT-2009,THINKSOFT,Thinksoft Global Ser Ltd,DINESH MUNJAL,BUY,237385,205.10,-
28-OCT-2009,THINKSOFT,Thinksoft Global Ser Ltd,DIPAN MEHTA SHARE & STOCK BROKERS PVT. LTD.,BUY,156629,206.31,-
28-OCT-2009,THINKSOFT,Thinksoft Global Ser Ltd,G RAMAKRISHNA,BUY,168000,202.55,-
28-OCT-2009,THINKSOFT,Thinksoft Global Ser Ltd,GENUINE STOCK BROKERS PVT LTD,BUY,219177,200.87,-
28-OCT-2009,THINKSOFT,Thinksoft Global Ser Ltd,HARBUX SINGH SIDHU,BUY,452734,205.72,-
28-OCT-2009,THINKSOFT,Thinksoft Global Ser Ltd,JAIN AMITESH KUMAR,BUY,57781,207.32,-
28-OCT-2009,THINKSOFT,Thinksoft Global Ser Ltd,KALASH SHARES & SECURITIES PRIVATE LIMITED,BUY,560286,202.84,-
28-OCT-2009,THINKSOFT,Thinksoft Global Ser Ltd,MANIPUT INVESTMENTS PVT. LTD.,BUY,466343,203.98,-
28-OCT-2009,THINKSOFT,Thinksoft Global Ser Ltd,MANISH KUMAR ASHKARAN,BUY,44692,203.89,-
28-OCT-2009,THINKSOFT,Thinksoft Global Ser Ltd,MANISH VIRCHAND LAKHANI,BUY,45000,209.47,-
28-OCT-2009,THINKSOFT,Thinksoft Global Ser Ltd,MANSUKH SECURITIES & FINANCE LIMITED,BUY,161436,206.16,-
28-OCT-2009,THINKSOFT,Thinksoft Global Ser Ltd,MARWADI SHARES AND FINANCE LIMITED,BUY,191643,203.72,-
28-OCT-2009,THINKSOFT,Thinksoft Global Ser Ltd,MBL & COMPANY LTD.,BUY,73269,206.39,-
28-OCT-2009,THINKSOFT,Thinksoft Global Ser Ltd,MEET TRADELINK,BUY,86818,204.01,-
28-OCT-2009,THINKSOFT,Thinksoft Global Ser Ltd,MEHTA RUBY,BUY,69978,207.73,-
28-OCT-2009,THINKSOFT,Thinksoft Global Ser Ltd,NAMAN SECURITIES & FINANCE PVT. LTD,BUY,123381,207.86,-
28-OCT-2009,THINKSOFT,Thinksoft Global Ser Ltd,NIKON FINLEASE PVT. LTD,BUY,101884,206.76,-
28-OCT-2009,THINKSOFT,Thinksoft Global Ser Ltd,NIMIT JAYENDRA SHAH,BUY,65332,205.39,-
28-OCT-2009,THINKSOFT,Thinksoft Global Ser Ltd,OM INVESTMENTS,BUY,817822,205.86,-
28-OCT-2009,THINKSOFT,Thinksoft Global Ser Ltd,PASHUPATI CAPITAL SERVICES PVT. LTD.,BUY,67159,204.98,-
28-OCT-2009,THINKSOFT,Thinksoft Global Ser Ltd,PRASHANT JAYANTILAL PATEL,BUY,109806,210.08,-
28-OCT-2009,THINKSOFT,Thinksoft Global Ser Ltd,R APPALA RAJU,BUY,94000,205.27,-
28-OCT-2009,THINKSOFT,Thinksoft Global Ser Ltd,R.M. SHARE TRADING PVT LTD,BUY,144138,204.86,-
28-OCT-2009,THINKSOFT,Thinksoft Global Ser Ltd,RUPESH KIRIT DALAL,BUY,94776,207.71,-
28-OCT-2009,THINKSOFT,Thinksoft Global Ser Ltd,SANJAY BHANWARLAL JAIN,BUY,83545,208.47,-
28-OCT-2009,THINKSOFT,Thinksoft Global Ser Ltd,SMITA M PATEL,BUY,51810,201.10,-
28-OCT-2009,THINKSOFT,Thinksoft Global Ser Ltd,SUNEET LAL,BUY,75155,203.91,-
28-OCT-2009,THINKSOFT,Thinksoft Global Ser Ltd,SURESH KUMAR BATAR,BUY,56417,205.24,-
28-OCT-2009,THINKSOFT,Thinksoft Global Ser Ltd,TANDON VINOD MURLIDHAR,BUY,80000,210.94,-
28-OCT-2009,THINKSOFT,Thinksoft Global Ser Ltd,TRANSGLOBAL SECURITIES LTD.,BUY,392054,205.52,-
28-OCT-2009,THINKSOFT,Thinksoft Global Ser Ltd,VIJETA BROKING INDIA PRIVATE LIMITED,BUY,154044,204.95,-
28-OCT-2009,THINKSOFT,Thinksoft Global Ser Ltd,VINAY SUKHANI,BUY,53771,206.62,-
28-OCT-2009,THINKSOFT,Thinksoft Global Ser Ltd,YES INVESTMENTS VISHAL KISHORE BHATIA,BUY,85050,199.03,-
28-OCT-2009,APTECHT,Aptech Limited,SARAVANA STOCKS PRIVATE LIMITED,SELL,250000,182.99,-
28-OCT-2009,EDL,Empee Distilleries Limite,SRI SUBHALAKSHMI INVESTMENTS,SELL,128000,129.25,-
28-OCT-2009,EXCELINFO,Excel Infoways Limited,AMBIT SECURITIES BROKING PVT. LTD.,SELL,110864,73.08,-
28-OCT-2009,EXCELINFO,Excel Infoways Limited,JATIN LAXMIKANT TRIVEDI,SELL,448299,72.87,-
28-OCT-2009,EXCELINFO,Excel Infoways Limited,PARESH SANATKUMAR RACHH,SELL,211902,72.93,-
28-OCT-2009,ISPATIND,Ispat Industries Limited,JAYPEE CAPITAL SERVICES LTD.,SELL,10716875,20.86,-
28-OCT-2009,NATCOPHARM,Natco Pharma Limited,SOMERSET FCCB A/C,SELL,150000,114.47,-
28-OCT-2009,NUTEK,Nu Tek India Limited,BALYASNY SI LIMITED,SELL,175000,84.75,-
28-OCT-2009,SUJANATOW,Sujana Tower Limited,DEUTSCHE SECURITIES MAURITIUS LIMITED,SELL,1213943,57.26,-
28-OCT-2009,THINKSOFT,Thinksoft Global Ser Ltd,AANGI SHARES & SERVICES PVT. LTD,SELL,233176,208.97,-
28-OCT-2009,THINKSOFT,Thinksoft Global Ser Ltd,ADROIT FINANCIAL SERVICES PRIVATE LIMITED,SELL,67154,205.51,-
28-OCT-2009,THINKSOFT,Thinksoft Global Ser Ltd,ARCHITA C GADA,SELL,169419,207.09,-
28-OCT-2009,THINKSOFT,Thinksoft Global Ser Ltd,AUM SECURITIES PRIVATE LTD.,SELL,78344,202.76,-
28-OCT-2009,THINKSOFT,Thinksoft Global Ser Ltd,BHAVIN SURESH CHHEDA,SELL,67760,204.65,-
28-OCT-2009,THINKSOFT,Thinksoft Global Ser Ltd,BP FINTRADE PRIVATE LIMITED,SELL,340776,204.77,-
28-OCT-2009,THINKSOFT,Thinksoft Global Ser Ltd,C D INTEGRATED SERVICES LTD.,SELL,51131,210.36,-
28-OCT-2009,THINKSOFT,Thinksoft Global Ser Ltd,CHANDARANA INTERMEDIARIES BROKERS P. LTD,SELL,69048,206.62,-
28-OCT-2009,THINKSOFT,Thinksoft Global Ser Ltd,CHOKHANI SECURITIES LTD,SELL,74815,205.20,-
28-OCT-2009,THINKSOFT,Thinksoft Global Ser Ltd,CPR CAPITAL SERVICES LTD.,SELL,261896,206.39,-
28-OCT-2009,THINKSOFT,Thinksoft Global Ser Ltd,DINESH MUNJAL,SELL,242385,205.94,-
28-OCT-2009,THINKSOFT,Thinksoft Global Ser Ltd,DIPAN MEHTA SHARE & STOCK BROKERS PVT. LTD.,SELL,156629,206.39,-
28-OCT-2009,THINKSOFT,Thinksoft Global Ser Ltd,G RAMAKRISHNA,SELL,168000,202.96,-
28-OCT-2009,THINKSOFT,Thinksoft Global Ser Ltd,GENUINE STOCK BROKERS PVT LTD,SELL,219177,201.15,-
28-OCT-2009,THINKSOFT,Thinksoft Global Ser Ltd,HARBUX SINGH SIDHU,SELL,457734,206.08,-
28-OCT-2009,THINKSOFT,Thinksoft Global Ser Ltd,JAIN AMITESH KUMAR,SELL,56981,205.74,-
28-OCT-2009,THINKSOFT,Thinksoft Global Ser Ltd,KALASH SHARES & SECURITIES PRIVATE LIMITED,SELL,562286,203.14,-
28-OCT-2009,THINKSOFT,Thinksoft Global Ser Ltd,MANIPUT INVESTMENTS PVT. LTD.,SELL,466343,204.41,-
28-OCT-2009,THINKSOFT,Thinksoft Global Ser Ltd,MANISH KUMAR ASHKARAN,SELL,55691,206.48,-
28-OCT-2009,THINKSOFT,Thinksoft Global Ser Ltd,MANISH VIRCHAND LAKHANI,SELL,64067,209.69,-
28-OCT-2009,THINKSOFT,Thinksoft Global Ser Ltd,MANSUKH SECURITIES & FINANCE LIMITED,SELL,161436,206.46,-
28-OCT-2009,THINKSOFT,Thinksoft Global Ser Ltd,MARWADI SHARES AND FINANCE LIMITED,SELL,191393,203.88,-
28-OCT-2009,THINKSOFT,Thinksoft Global Ser Ltd,MBL & COMPANY LTD.,SELL,73269,207.04,-
28-OCT-2009,THINKSOFT,Thinksoft Global Ser Ltd,MEET TRADELINK,SELL,176818,209.17,-
28-OCT-2009,THINKSOFT,Thinksoft Global Ser Ltd,MEHTA RUBY,SELL,69978,207.86,-
28-OCT-2009,THINKSOFT,Thinksoft Global Ser Ltd,NAMAN SECURITIES & FINANCE PVT. LTD,SELL,120172,206.93,-
28-OCT-2009,THINKSOFT,Thinksoft Global Ser Ltd,NIKON FINLEASE PVT. LTD,SELL,101884,207.08,-
28-OCT-2009,THINKSOFT,Thinksoft Global Ser Ltd,NIMIT JAYENDRA SHAH,SELL,65332,211.92,-
28-OCT-2009,THINKSOFT,Thinksoft Global Ser Ltd,OM INVESTMENTS,SELL,817822,205.95,-
28-OCT-2009,THINKSOFT,Thinksoft Global Ser Ltd,PASHUPATI CAPITAL SERVICES PVT. LTD.,SELL,67159,205.34,-
28-OCT-2009,THINKSOFT,Thinksoft Global Ser Ltd,PRASHANT JAYANTILAL PATEL,SELL,109806,210.43,-
28-OCT-2009,THINKSOFT,Thinksoft Global Ser Ltd,R APPALA RAJU,SELL,94000,205.13,-
28-OCT-2009,THINKSOFT,Thinksoft Global Ser Ltd,R.M. SHARE TRADING PVT LTD,SELL,144138,205.05,-
28-OCT-2009,THINKSOFT,Thinksoft Global Ser Ltd,RUPESH KIRIT DALAL,SELL,94776,208.09,-
28-OCT-2009,THINKSOFT,Thinksoft Global Ser Ltd,SANJAY BHANWARLAL JAIN,SELL,83545,208.71,-
28-OCT-2009,THINKSOFT,Thinksoft Global Ser Ltd,SMITA M PATEL,SELL,51810,202.62,-
28-OCT-2009,THINKSOFT,Thinksoft Global Ser Ltd,SUNEET LAL,SELL,75155,204.95,-
28-OCT-2009,THINKSOFT,Thinksoft Global Ser Ltd,SURESH KUMAR BATAR,SELL,56417,204.63,-
28-OCT-2009,THINKSOFT,Thinksoft Global Ser Ltd,TANDON VINOD MURLIDHAR,SELL,80000,205.22,-
28-OCT-2009,THINKSOFT,Thinksoft Global Ser Ltd,TRANSGLOBAL SECURITIES LTD.,SELL,392054,206.38,-
28-OCT-2009,THINKSOFT,Thinksoft Global Ser Ltd,VIJETA BROKING INDIA PRIVATE LIMITED,SELL,154044,205.56,-
28-OCT-2009,THINKSOFT,Thinksoft Global Ser Ltd,VINAY SUKHANI,SELL,53771,206.99,-
28-OCT-2009,THINKSOFT,Thinksoft Global Ser Ltd,YES INVESTMENTS VISHAL KISHORE BHATIA,SELL,85050,203.22,-
Post Session Commentary - Oct 28 2009
The Indian market closed in the negative territory after facing huge volatility during the trading session. The concerns about the sooner than expected rise in the interest rates after RBI raised its inflation forescast, prompt the investors to be bit cautious to book further positions. Moreover, the cues from the global market are not in favor as the US consumer confidence data that fell to 47.7 per cent from a revised 53.4 in September that led the investors to be calculative. From the sectoral front, the bankex stock faced the pressure as they did not announce any hike in the ceiling on the portion of government securities, which the banks can park in held to maturity segment. Moreover, the RBI’s decision to streamline provisioning requirement on non performing assets, where the banks have to ensure that by September 2010, the total provisioning coverage against non performing or bad loans are not less than 70% of the outstanding amount. Apart from this, the consumer durables and PSU stocks also remained in the sellers’ radar. While on the other hand, the Realty stocks made a smart come back from the intraday fall to close with decent gains. The BSE Sensex closed below the 16,300 mark while Nifty just below 4,830 mark. From the sectoral front, Consumer Durables (down (1.79%), Bankex (down 1.50%) and PSU (down 1.15%) while Realty (up 0.88%), Teck (up 0.73%) and Oil and Gas (up 0.69%).
After a dismal opening tracking the weak global cues, the market extend losses further in the early trade but recover from the lows to trade in positive territory as the day progressed but the last final hours of selling in selective indices led the market to close on the backfoot. The market faced the pressure as the traders rolled positions in the derivatives segment from October 2009 series to November 2009 series ahead of the expiry of the October 2009 contracts, scheduled tomorrow. The US markets closed in mixed on Tuesday. Consumer Discretionary stocks were under pressure as retailers retreated following a disappointing Consumer Confidence Index reading of 47.7 for October. Energy stocks outperformed the broader market due to strong trade in oil stocks and rebound in oil prices. Treasuries spurted amid the mixed action among equity. That was supported by a strong 3.6 bid-to-cover outcome for a $44 billion auction of 2-year Treasuries. This helped the broader 10-year Note rose nearly one full point and gusted its yield back below 3.5%.
Today, Finance Secretary Ashok Chawla said that any further measures by the Reserve Bank of India to withdraw special liquidity measures could come in January 2010. He also said that the Centre and state governments do not need to borrow more than planned in the financial year. He said the states would borrow Rs 60,000 crore between November 2009 and March 2010.
Among the Sensex pack 19 stocks ended in negative territory and 11 stocks in positive territory. The market breadth indicating the overall health of the market remained weak as 1,627 stocks closed in red while 1,059 stocks closed in green and 71 stocks remained unchanged in BSE.
The BSE Sensex closed lower by 69.91 points or (0.43%) at 16,283.49 and NSE Nifty closed down by 20.55 points or (0.42%) at 4,826.15. The BSE Mid Caps closed up by 9.41 points at 6,166.89 while the BSE Small Caps closed with losses of 31.69 points at 7,206.53. The BSE Sensex touched intraday high of 16,411.14 and intraday low of 16,144.17.
Losers from the BSE Sensex pack are Maruti Suzuki (4.47%), Tata Steel (3.73%), HDFC (3.23%), ICICI Bank (3.12%), HDFC Bank (3.11%), Reliance Communication (2.50%), ONGC (2.29%) and Sterlite Inds (2.20%).
Gainers from the BSE Sensex pack are Bharti Airtel (3.42%), Wipro (3.19%), Tata Motors (2.62%), RIL (2.28%) and L&T (1.97%).
On the global markets front, the Asian markets that opened before the Indian market, closed in red. Jakarta Composite, Seoul Composite, Hang Seng, Strait Times and Nikkei ended lower by 2.88%, 2.41%, 1.84%, 1.69% and 1.35% at 2,355.31, 1,609.71, 21,761.58, 2,648.98 and 10,075.05 respectively.
European markets, which opened after the Indian market, are trading lower. In Paris the CAC 40 is down by 1.64% at 3,682.59, in Frankfurt DAX index is trading down by 1.58% at 5,545.79 and in London FTSE 100 is lower by 1.72% at 5,111.50.
The Consumer Durables index closed with losses of 61.66 points or 1.79% at 3,374.94. Losers from this pack are Blue Star (2.77%), Videocon Inds (2.57%), Gitanjali GE (2.26%) and Titan INds (0.96%) closed in negative.
The Bankex index closed lower by 145.42 points or 1.50% at 9,533.66. Losers are IDBI bank (3.69%), ICICI Bank (3.12%), HDFC Bank (3.11%), Axis bank (2.48%), Karnataka bank (2.26%) and Canara bank (2.21%) closed in red.
The Realty index closed with gains of 35.60 points or 0.88% at 4,081.64. Gainers from this pack are Indiabull Real (2.96%), HDIL (2.06%), Unitech (1.58%) and DLF (0.31%) closed in green.
RIL gains in choppy market
The key benchmark indices drifted lower in choppy trade after US consumer confidence data dampened investor appetite for riskier assets like equities and high-yielding and growth-related currencies. Most global stocks were in red. The BSE 30-share Sensex fell 69.91 points or 0.43%, off close to 125 points from the day's high and up close to 140 points from the day's low. The market extended losses for the third day in a row. From a recent high of 16810.81 on 23 October 2009, the Sensex has lost 527.32 points or 3.13% in three trading sessions
The market breadth was weak. Index heavyweight Reliance Industries (RIL) jumped. Realty stocks also rose. But, metal and auto stocks fell.
Bank stocks fell for the second straight day as the RBI did not relax mark-to-market rules for bank's debt holdings at a quarterly policy review on Tuesday. The market was been agog with talks over the past few days of the central bank hiking the ceiling on the portion of government securities that banks can park in held-to-maturity (HTM).
Another trigger for the sharp slide in banking stocks was the central banks' decision to streamline provisioning requirement on non-performing assets. The RBI asked banks to ensure by September 2010 that the total provisioning coverage against non-performing or bad loans aren't less than 70% of the outstanding amount.
Intraday volatility was high as traders rolled positions in the derivatives segment from October 2009 series to November 2009 series ahead of the expiry October 2009 contracts on Thursday, 29 October 2009.
After a weak opening, the market extended losses in early trade before staging a strong rebound. The market moved into the green from red in early afternoon trade. The market slipped into the red once again after hitting fresh intraday high in early afternoon trade. Volatility remained high in the last one hour of trade.
Concerns that interest rates may rise sooner-than-expected had spooked the market on Tuesday, 27 October 2009, after the Reserve Bank of India at a quarterly policy review sharply raised inflation forecast. However, analysts say that monetary policy could be ineffective in reining in a rise in inflation caused by supply shortage. A surge in food prices caused by production shortage has been a key reason for the rise in inflation in the past few weeks.
Meanwhile, a heightened volatility in the rupee against the dollar in the past few days has raised worries that the corporate sector may suffer losses on hedging. The rupee weakened past the 47 per dollar mark for the first time in three weeks in early trade on Wednesday, 28 October 2009, as Asian stocks fell.
Finance Secretary Ashok Chawla on Wednesday said that any further measures by the Reserve Bank of India to withdraw special liquidity measures could come in January 2010, the month when the next monetary policy review is scheduled. Chawla also said the Centre and state governments do not need to borrow more than planned in the fiscal year ending March 2010. He said the states would borrow Rs 60,000 crore between November 2009 and March 2010.
Reserve Bank of India deputy governor Shyamala Gopinath today said the challenge at the current juncture is to revive private credit demand.
The Reserve Bank of India (RBI) on Tuesday withdrew emergency liquidity support measures that were implemented in the aftermath of the global financial crisis. The central bank warned of possible asset price bubbles and raised banks' provisioning requirements for commercial real estate loans. The central bank said the precise challenge for the Reserve Bank of India is to support the economic recovery process without compromising on price stability. Growth drivers warrant a delayed exit, while inflation concerns call for an early exit, it said. Premature exit will derail the fragile growth, but a delayed exit can potentially engender inflation expectations, the RBI said.
The RBI raised the statutory liquidity ratio (SLR) to 25% from 24% with effect from 7 November 2009. SLR is the minimum share of bank deposits to be held in approved government securities. By hiking the SLR, the RBI seems to be sending a signal that the high fiscal deficit will continue. The SLR hike will ensure easy funding of the government's borrowing programme for not just this year but the next fiscal as well
The RBI raised projection of inflation to 6.5% with an upside bias at end March 2010 from earlier 5%.
Meanwhile, the latest economic data showed infrastructure sector output grew 4% in September 2009 from a year earlier, slower than upwardly revised annual growth of 7.8% in August 2009. The infrastructure sector accounts for 26.7% of the industrial output. During April-September, the first half of the 2009/10 year, output rose 5% compared with 3.4% in the same period in 2008/09.
Global consumer confidence is rebounding, and in the United States has risen for the first time since 2007, amid signs the world economy is picking up although spending is still restrained, according to a quarterly survey by The Nielsen Company, conducted between 28 September 2009 and 16 October 2009. Confidence was highest in India, followed by Indonesia and Norway, and was weakest in Japan, Latvia, Portugal and South Korea, although in Korea it had improved markedly, the survey showed.
In the United States - the world's biggest consumer market - consumer sentiment rose from three months ago for the first time since early 2007. The data contrasts with a Conference Board index of US consumer confidence, released on Tuesday, which showed a sharp deterioration in confidence this month.
European shares hit a three-week low on Wednesday as investors digested a slew of earnings news, including results from BG Group and Banco Santander, with energy and banking stocks the biggest fallers. The key benchmark indices in France, Germany and UK were down by between 1.68% to 1.79%.
Asian share markets edged lower Wednesday as shipping stocks and shipbuilders fell on worries about the strength of the global economic recovery, though Honda was buoyant in Tokyo after lifting its earnings forecast. The key benchmark indices in Hong Kong, Japan, South Korea, Singapore and Taiwan fell by between 1.39% to 2.41%.
But, China's Shanghai Composite rose 0.33%, erasing earlier losses, as airlines, brokerages and coal producers advanced on higher profits.
A Wall Street Journal report that GMAC Financial Services and the US Treasury Department were in advanced talks to prop up the lender with its third helping of taxpayer money was adding to the cautious tone, serving as a reminder of how some battered financial firms remain dependent on government lifelines.
Trading in US index futures indicated the Dow could fall 57 points on Wednesday, 28 October 2009.
US stocks closed mostly lower in volatile trade on Tuesday as a weaker-than-expected consumer confidence report undermined the market outlook on the pace of economic recovery from recession. The technology sector was under pressure following downside guidance from internet search engine baidu.com. Consumer-discretionary and tech stocks declined even as energy stocks rose along with oil prices. The Dow rose 14.21 points, or 0.1%, to 9,882.17. The S&P 500 index fell 3.54 points, or 0.3%, to 1,063.41, while Nasdaq fell 25.76 points, or 1.2%, to 2,116.09.
Back home, the supply of paper by Indian firms appear limitless, raising concerns that additional share sales will suck liquidity from the secondary equity market. As per reports, Indian firms have garnered about $9 billion (Rs 32,400 crore at the current exchange rates) through sale of shares and convertible bonds to institutional buyers since April 2009. Indian companies are taking advantage of a surge in liquidity to recapitalize and fund capital expenditure after being starved of cash last year.
Most of these companies - from industries ranging from liquor and spirits to infotech - issued equity shares to a select group of investors by way of qualified institutional placement or QIP. If the enabling resolutions passed by the companies are any indication, Indian firms are gearing up to raise $15 billion (Rs 69,427 crore) in the next six months. The list includes Hindalco (Rs 2,900 crore), JSW Steel ($1 billion), India Cements ($100 million), Essar Oil ($2 billion), Tata Steel (Rs 5,000 crore), Jet Airways ($ 400 million) and Bharat Forge ($150 million).
Unlisted Reliance Infratel announced on 22 September 2009 its intention to raise Rs 5,000 crore from the primary market. Divestment of state-run firms by the government may also increase the supply of paper in the market.
The government recently approved stake sales in state-run power producer NTPC and another unlisted power firm Satluj Jal Vidyut Nigam which reflects the country's resolve to speed up reforms and raise more resources for social schemes. On Monday, Trade Minister Anand Sharma said the Union Cabinet had approved a 5% stake sale in NTPC, and 10% in, an unlisted power producer. On 16 October 2009, Prime Minister Manmohan Singh said many state-run firms are eager to list their shares in the stock market as it would help unlock their value.
The government has approved a follow-on public offering of 20% of state run Steel Authority of India, the steel minister said on Wednesday, 21 October 2009. The Government of India owns nearly 86% of Sail.
The BSE 30-share Sensex fell 69.91 points or 0.43% to 16,283.49. The Sensex rose 57.74 points at the day's high of 16,411.14 in afternoon trade. The Sensex fell 209.23 points at the day's low of 16144.17 in early trade.
The S&P CNX Nifty fell 20.55 points or 0.42% to 4,826.15. Nifty October 2009 futures were at 4,832.95, at a premium of 6.80 points as compared to the spot closing of 4,826.15. Turnover in NSE's futures & options (F&O) segment was Rs 1,06,431.02 crore, lower than Rs 1,21,614.13 crore on Tuesday, 27 October 2009.
BSE clocked turnover of Rs 5413 crore, lower than Rs 5932.36 crore on Tuesday, 27 October 2009.
The market breadth, indicating the overall health of the market was weak. On BSE, 1054 shares advanced as compared with 1622 that declined. A total of 72 shares remained unchanged.
Among the 30-member Sensex pack, 19 fell while rest rose.
From a 17-month closing high of 17,326.01 on 17 October 2009, the Sensex has lost 1,042.52 points or 6.01% in seven trading sessions to current 16,283.49. Yet, with foreign funds making heavy purchases, the Sensex is up 6636.18 points or 68.78% in calendar year 2009, as on 28 October 2009. From a 3-year closing low of 8,160.40 on 9 March 2009, the Sensex is up 8123.09 points or 99.54%, as on 28 October 2009. FII inflow in the calendar year 2009 totaled Rs 69,272.20 crore (till 27 October 2009).
Coming back to today's trade, the BSE Mid-Cap index rose 0.15% and outperformed Sensex. The BSE Small-Cap index shed 0.44%, which was almost equal to the fall in the Sensex.
Sectoral indices on BSE displayed mixed trend. The BSE Realty index (up 0.88%), the BSE Teck index (up 0.73%), the BSE Oil & Gas index (up 0.69%), the BSE Capital Goods index (up 0.65%), the BSE IT index (up 0.53%), the BSE Healthcare index (up 0.48%), the BSE FMCG index (down 0.2%), outperformed the Sensex.
The BSE Consumer Durables index (down 1.79%), the BSE Bankex (down 1.5%), the BSE PSU index (down 1.15%), the BSE Auto index (down 0.94%), the BSE Power index (down 0.83%), the BSE Metal index (down 0.58%), underperformed the Sensex.
Energy major Reliance Industries rose 2.28% to Rs 2035.65 after the government on Tuesday allocated an additional 50 million cubic metres a day (mmscmd) of gas from Reliance Industries-operated east coast block D6. Power plants and refineries will get the bulk of Reliance Industries' gas from the Krishna-Godavari basin beyond the previously allotted 40 million metric standard cubic metres per day (mmscmd).
The empowered group of ministers (eGoM) also made some allotments for Reliance's petrochemical plants and refineries.
Meanwhile, the continued pressure on gross refining margins, or the difference between the price of crude and the price of refined petroleum products, is seen weighing on the company's bottom-line in Q2 September 2009, in spite of higher gas production and refining throughput. RIL unveils Q2 results on Thursday, 29 October 2009.
A total of eight brokerages expect a between a 9% fall to a 1.4% rise in RIL's net profit at between Rs 3752.10 crore to Rs 4178 crore in Q2 September 2009 over Q2 September 2008. Their expectations peg a between 23% fall to a rise of 19.8% in revenue at between Rs 34292.90 crore to Rs 53667.70 crore in Q2 September 2009 over Q2 September 2008.
Reliance Industries on Tuesday told the Supreme Court that it would lose money by selling natural gas at $2.34 per million British thermal units or mmBtu. The company's lawyer Harish Salve told the court that RIL had not told the Bombay HC that sale at $2.34 per unit would be profitable and that the HC appeared to have misunderstood the matter.
The hearing before India's apex court was also marked by interjections by the justices. The judges observed that the natural gas belongs to the government and all contracts on sharing of gas are subject to the government's approval. The court also said that it may issue a direction to the two feuding companies, RIL and Reliance Natural Resources (RNRL), to arrive at a suitable arrangement.
Mukesh Ambani-controlled Reliance Industries, India's top conglomerate, is fighting with Reliance Natural Resources, led by younger brother Anil Ambani, over the terms of a deal to sell gas to Reliance Natural at below the price set by the government.
Bank stocks fell after Reserve Bank held key rates unchanged on Tuesday. India's largest private sector bank by operating income ICICI Bank fell 3.12% as its ADR fell 8.19% on Tuesday. Singapore's Temasek cut its stake to 5.76% as of 30 September 2009 from 7.6% as of end of June 2009. Temasek said in a statement in Singapore on Tuesday that any stake sales are part of regular moves to review and rebalance its portfolio.
India's second largest private sector bank by net profit HDFC Bank fell 3.11% as its ADR fell 2.21% on Tuesday. The bank's net profit rose 30.2% to Rs 687.46 crore in Q2 September 2009 over Q2 September 2008. The results were more or less in line with market expectations.
But, India's largest bank by branch network State Bank of India rose 0.69%. State Bank of India (SBI) announced on 24 October 2009 that it has concluded the issue of $750 million fixed rate senior notes having a maturity of 5 years at a coupon of 4.50% under the Medium Term Notes (MTN) Programme in the form of Regulation S Global Note. The bonds have been issued through the bank's London branch as of 23 October 2009.
Banks do not have to make any mark-to-market provisions on securities held in the HTM basket if prices of securities fall. Provisions have to be made out of profit and therefore, impact a bank's bottom line. Yields on ten-year government bonds have risen sharply this year. Bond prices and bond yields are inversely related.
Metal stocks fell after a gauge of six metals traded on the London Metal Exchange fell 0.43% on Tuesday, 27 October 2009. JSW Steel, Jindal Saw, Hindustan Zinc, Hindalco Industries fell by between 0.28% to 2.56%.
India's largest copper maker by sales Sterlite Industries fell 2.2% as its ADR fell 6.67% on Tuesday. The company recently raised $500 million in convertible senior notes and plans to use the proceeds primarily for expansion of its copper business. The notes are convertible into American depositary shares at $23.33 per share.
Steel Authority of India (Sail) fell 2.77%. The steel minister said last week the government has approved a follow-on public offering of 20%. The government holds 85.82% stake in Sail.
India's largest steel maker by sales Tata Steel fell 3.73% extending Tuesday's 7.26% fall as net profit fell 49.49% to Rs 902.94 crore in Q2 September 2009 over Q2 September 2008. The results hit the market during market hours on Tuesday.
Rate sensitive auto stocks fell on concerns hike in interest rates may crimp sales of automobiles. Most auto sales including that of cars, two-wheelers, utility vehicles and commercial vehicles are driven by financing by the buyer. Low interest rates has helped a solid rebound in sales across the auto industry this year
Bajaj Auto fell 0.61%. Bajaj Auto's net profit jumped 117.85% to Rs 402.83 crore in Q2 September 2009 over Q2 September 2008. The company announced the Q2 results during trading hours on 15 October 2009.
India's largest tractor maker by sales Mahindra & Mahindra fell 0.67%. Total sales rose 10.94% to 28434 vehicles in September 2009 over September 2008. The company unveiled the sales figures during trading hours on 1 October 2009.
Hero Honda Motors fell 0.58% even as net profit jumped 95% to Rs 597.14 crore on 26.8% rise in revenue to Rs 4059.44 crore in Q2 September 2009 over Q2 September 2008. The company announced result after market hours on 21 October 2009.
India's largest car maker by sales Maruti Suzuki India fell 4.47% after the company said margins may come under pressure due to hardening of commodity prices and strengthening of the Japanese yen. At the time of announcing Q2 results, last week, the company said it continues to focus on cost optimization. Maruti said the company remains cautiously optimistic with regard to volume growth in the near future
Maruti's net profit rose 92.5% to Rs 570 crore on 46.6% rise in sales to Rs 7080.67 crore in Q2 September 2009 over Q2 September 2008. The company announced the results on Saturday, 24 October 2009
India's largest commercial vehicle maker by sales Tata Motors rose 2.42% after its net profit jumped 110.13% to Rs 729.14 crore on 11.87% rise in total income to Rs 8399.75 in Q2 September 2009 over Q2 September 2008. The results were announced after market hours on 26 October 2009 when the stock had risen nearly 2% in an otherwise weak market.
Realty stocks rose on bargain hunting after a steep fall on Tuesday triggered by the central bank's decision to raise the provisioning requirement for banks' advances to the commercial real estate sector classified as 'standard assets' from the present level of 0.40% from 1%. This will raise the borrowing costs for realty firms which depend heavily on borrowing. Indiabulls Real Estate, DLF, Unitech rose by between 0.31% to 2.96%.
In view of large increase in credit to the commercial real estate sector over the last one year and the extent of restructured advances in this sector, it would be prudent to build cushion against likely non-performing assets (NPAs), the central bank said.
As per recent reports, demand for residential projects in major cities is picking up on lower home loan rates, property price cuts by developers and a recovery in the job market. The housing market had slumped last year amid a global credit crunch and buyers fearing job losses
India's largest cigarette maker by sales ITC fell 0.46% on profit taking after a recent strong rally triggered by robust Q2 results. Net profit rose 25.81% to Rs 1009.91 crore in Q2 September 2009 over Q2 September 2008. The result which hit market during market hours on Friday 23 October 2009, surpassed market expectations.
A surge in profit margins and a decent growth in revenue boosted the bottom line. ITC's operating profit margin surged to 36.59% in Q2 September 2009 from 31.4% in Q2 September 2008.
Among other FMCG stocks, Hindustan Unilever, REI Agro, Dabur India fell by between 0.54% to 1.17%.
India's largest cement producer by sales ACC fell 1.63% as concerns that a glut in supply will put pressure on cement prices offset strong Q3 results from the cement major. Net profit rose 53.69% to Rs 435.63 crore in Q3 September 2009 over Q3 September 2008. The results hit market during market hours today.
At the time of announcing Q3 results, ACC today said a sizeable additional cement capacity is expected to materialise in all the regions withing the next one year. ACC, however, said it expects a significant surge in cement demand from the infrastructure sector and various development schemes of the government. It expects robust demand from smaller cities and semi-urban markets
IT stocks rose on a weak rupee. India's third largest IT exporter by sales Wipro rose 3.19% extending Tuesday's 2.18% gains on better than expected results. As per consolidated Indian GAAP results, the company recorded 19% rise in net profit to Rs 1162 crore in Q2 September 2009 over Q2 September 2008. The net profit rose 14% to Rs 1162 crore in Q2 September 2009 over Q1 June 2009. The results hit the market before trading hours on Tuesday.
Wipro said order book has gone up and it is seeing a strong second half as pricing stabilises. Wipro expects its IT services revenue to rise 3.8% to 5.7% to $1.09-$1.11 billion in Q3 December 2009 ovfrom Q2 September 2009
IT bellwether Infosys Technologies rose 0.55% even as its ADR fell 2.17% on Tuesday. Infosys raised its earnings and revenue guidance in both dollar and rupee terms for the year ending March 2010 (FY 2010) at the time of announcing Q2 September 2009 results before trading hour on 9 October 2009. Infosys, however, said strengthening rupee is a big concern for its earnings.
A foreign brokerage said in a recent note that it expects 2010 IT budgets to be strong given a significant pent-up demand.
India's largest software services exporter TCS rose 0.16%. The company after market hours on 16 October 2009, reported stronger-than-expected Q2 September 2009 results. Consolidated net profit as per US accounting standards rose 6.81% to Rs 1623.90 crore on 3.16% growth in revenue to Rs 7435.10 crore in Q2 September 2009 over Q1 June 2009.
TCS has a good business pipeline and is pursuing 20 to 25 large outsourcing deals, chief executive N. Chandrasekaran said at the time of announcing Q2 results. The management is seeing signs of recovery but it believes it will be slow. The discretionary spent is still tight but there is spent seen in banking, finance services and insurance (BFSI), retail, utility and pharma verticals, TCS said at a conference call after the results. However, a continuous improvement in volumes cannot be expected, it said. The company is seeing stability in demand environment. The management expects to maintain margins at current levels provided there is no adverse rupee movement.
The rupee tumbled against the dollar on Wednesday on increase in risk aversion after weak US consumer confidence data. The partially convertible rupee was trading at 47.36/47.39, weaker than its previous close of 46.88/90 per dollar. A weak rupee boosts revenue of IT firms in rupee terms as the sector derives a lion's share of revenue from exports.
Construction stocks rose on the government's thrust on the infrastructure sector. Higher government spending on infrastructure sector in the Union Budget 2009-2010 to provide a stimulus to the economy, may result in increase order flow for construction. Hindustan Construction Company, Nagarjuna Construction Company Era Infra Engineering, Gayatri Projects rose by between 1.18% to 6.92%.
An expected fall in cement prices in the coming months due to capacity new capacity addition may boost margins for construction firms as cement is a key raw material
Jaiprakash Associates rose 0.14% on bargain hunting after recent sharp fall. Net profit rose 327.9% to Rs 870.19 crore on 53% rise in sales to Rs 1824.26 crore in Q2 September 2009 over Q2 September 2008. The company announced result after market hours on 21 October 2009. The company also announced 1:2 bonus issue at the time of announcing Q2 results
India's largest engineering and construction firm by sales Larsen & Toubro rose 1.97%. The company announced on 26 October 2009 sale of its shares in Voith Paper Technology India (VPTIL) to its long term joint venture partner Voith GmbH, Heidenheim, Germany. VPTIL is a 50:50 joint venture partner between L&T and Voith GmbH providing design, consultancy and other value added services to Indian paper industry.
L&T's net profit rose 26.1% to Rs 580.4o crore on 3.54% rise in total income to Rs 8136.39 crore in Q2 September 2009 over Q2 September 2008. The result hit the market during trading hours on 22 October 2009.
But many other capital goods stocks fell. Bharat Heavy Electricals, BEML, Siemens and Praj Industries fell by between 1.1% to 4.19%.
Telecom stocks rose on bargain hunting after recent fall Tuesday's steep slide triggered by concerns about price war in the sector. Idea Cellular's Managing Director Sanjeev Aga, said on 26 October 2009 the price war in the teleocom sector which he described as a 'bloodbath' would cut local call charges, currently at 40 paise a minute, to 'unsustainable' levels. Idea Cellular rose 0.55%.
India's largest wireless operator by sales Bharti Airtel rose 3.42%. But India's second- largest wireless operator by sales Reliance Communications fell 2.5%. The company said early this week it does not have to pay any additional licence or spectrum fee to the government nor had it inflated its revenues. The statement came after the company said it had completed a "preliminary review" of a report issued by a government-appointed auditor which had accused it of various malpractices.
Some sugar stocks rose on reports the government is likely to cut the levy sugar quota for November 2009 by around 9%. Bajaj Hindustan, Balrampur Chini, Shree Renuka Sugars and Ponni Sugar rose by between 2.12% to 7.88%.
Cals Refineries clocked highest volume of 3.97 crore shares on BSE. Unitech (2.09 crore shares), Thinksoft Global (1.35 crore shares), Ispat Industries (1.13 crore shares) and NHPC (0.8 crore shares) were the other volume toppers in that order.
Thinksoft Global clocked highest turnover of Rs 287.94 crore o BSE. State Bank of India (Rs 275.06 crore), Unitech (Rs 182.32 crore), Housing Development & Infrastructure (Rs 176.04 crore) and Reliance Industries (Rs 175.56 crore) were the other turnover toppers in that order.
Grey Market Premium - Den Networks, Indiabulls Power, Astec Life Sciences
| Company Name | Offer Price (Rs.) | Premium (Rs.) |
| Indiabulls Power | 45 | +/- 2 to 3 |
| DEN Network Ltd. | 195 to 205 | 5 to 6 |
| Astec Life Science | 77 to 82 | 4 to 4.50 |
Pre Session Commentary - Oct 28 2009
Today domestic markets are likely to open negative amid weak trade in Asian Market, weak start in SGX Nifty as well and mixed performance in US Market overnight. The trade would be highly volatile with negative bias. One could expect stock specific and sector specific movement along the curve on the back of RBI monitory policy. Realty, Banking stocks are to be watched for. Today domestic market is likely to trade range bound with negative bias.
On Tuesday, Indian markets closed on a down beat note on the anticipation of tightening of monetary policy by Reserve bank of India (RBI). The RBI, which injected huge amount of money in the recent past in order to give a boost to the economy, kept its key policy rates unchanged. The RBI kept the repo rate, reverse repo rate and CRR unchanged at 4.75%, 3.25% and 5% respectively. While it increased the SLR to 25% from 24%. Moreover, it hiked the inflation target to 6.5% from 5%. While it kept the FY10 GDP target unchanged at 6% with upward and the HTM bond ratio at 25%. However, it aims to contain inflation 4-4.5%. It also said the aggregate deposits to grow 18%. RBI, ended a special repurchase facility for banks and another for the funding needs of non-bank financial companies, mutual funds and housing finance companies effective immediately. It also ended a forex swap facility for banks as well as cut an export credit refinance facility to a pre-crisis level of 15% from 50% with immediate effect. Realty (6.24%), Metals (5.82%), Banking (3.82%) and Consumer Durables (3.26%) stocks were hammered brutally. The Market breadth, indicating the overall strength of the market, was weak.
The BSE Sensex closed lower by 387.10 points or 2.31% at 16,353.40 and NSE Nifty closed down by 124.20 points or 2.50% at 4,846.70. BSE Mid Caps and BSE Small Caps closed with losses of 236.24 points and 334.80 points at 6,157.48 and 7,238.22 respectively. The BSE Sensex touched intraday high of 16,699.09 and intraday low of 16,311.50.
The US markets closed mixed on Tuesday as Dow was able to net a modest gain while Nasdaq finished in negative territory. The former gained as Exxon Mobil, Chevron, BP Plc and IBM reported better than expected earnings while the latter fell due to collective weakness among large-cap resulted to underperform the other headline Indices. Consumer Discretionary stocks were under pressure as retailers retreated following a disappointing Consumer Confidence Index reading of 47.7 for October. Energy stocks outperformed the broader market due to strong trade in oil stocks and rebound in oil prices. Treasuries spurted amid the mixed action among equity. That was supported by a strong 3.6 bid-to-cover outcome for a $44 billion auction of 2-year Treasuries. This helped the broader 10-year Note rose nearly one full point and gusted its yield back below 3.5%. Majority of the sectors finished the session down mainly from Consumer Discretionary (1.7%), Industrials (1.0%), Tech (0.9%) and Materials (0.9%). US light crude oil futures for December delivery closed up by 1.0% at $79.44 per barrel, on the New York Mercantile Exchange.
The Dow Jones Industrial Average (DJIA) ended with gain of 14.21 points at 9,882.17. NASDAQ index slipped 25.76 points to 2,116.09 and the S&P 500 (SPX) closed lower by 3.54 points at 1,063.41.
Indian ADRs ended in red on Tuesday. In the banking space, ICICI Bank was down 8.19% and HDFC Bank was down 2.11%. In the telecom space, Tata Communication was down 4.55% and MTNL was down 3.04%. In the IT space, Infosys was down 2.18%, Satyam Computers was down 3.47%, Patni Computers was down 0.97% while Wipro was up 0.37%.
The FIIs on Tuesday stood as net buyers in equity whereas net sellers in debt. Gross equity purchased stood at Rs. 2,147.90 crore and gross debt purchased stood at Rs. 484.30 crore, while the gross equity sold stood at Rs. 1,956.90 crore and gross debt sold stood at Rs. 777.00 crore. Therefore, the net investment of equity and debt reported were R. 191.00 crore and (Rs. 292.70) crore respectively.
On Tuesday, the partially convertible rupee ended at 46.92/93 per dollar, 0.6% stronger than previous closing at 46.64/65 per dollar.
On BSE, total number of shares traded were 42.75 crore and total turnover stood at Rs. 5,932.36 crore. On NSE, total number of shares traded were 91.84 crore and total turnover was Rs. 20,193.69 crore.
Top traded volumes on NSE Nifty – Unitech with total volume traded 102783737 shares, followed by Suzlon Energy with 23590937, DLF with 16277902, Jaiprakash Associates with 15753666 and IDFC with 14537239 shares.
On NSE Future and Options, total number of contracts traded in index futures was 1196264 with a total turnover of Rs. 29,244.90 crore. Along with this total number of contracts traded in stock futures were 1048245 with a total turnover of Rs. 33,641.10 crore. Total numbers of contracts for index options were 2233080 with a total turnover of Rs. 55,538.59 crore and total numbers of contracts for stock options were 96502 and notional turnover was Rs. 3,189.54 crore.
Today, Nifty would have a support at 4,792 and resistance at 4,883 and BSE Sensex has support at 16,239 and resistance at 16,433.
Corporate News - Oct 28 2009
Business Standard
Sun TV ties up with Endemol
Sun TV Network (Sun TV), owned by Kalanithi Maran, is looking at foreign partners to produce non-fiction contents. The company on October 27 joined hands with Dutch firm Endemol to launch a television game show.
``This tie-up would be the first step towards more international joint ventures. The international partner will bring his production expertise and will work on licensing model,`` said Sun TV chief operating officer Ajay Vidyasagar. Sun has a market share of 30-32% in the weekend viewer ship category and is planning to increase it by 12-15% over the next six months by offering new contents.
Economic Times
Aditya Birla PE fund raises USD 120 million
Aditya Birla Private Equity has raised USD 120 million through its maiden fund to invest in companies engaged into infrastructure, logistics, education, healthcare and consumer businesses. A person close to the development said the collected fund was 20% more than the target as banks, insurance companies and high networth individuals showed better-than-expected response.
Aditya Birla Private Equity, which recently acquired a minority stake in the Bombay Stock Exchange, announced that it will follow a hands on approach in managing its investment, rather than being a passive investor in the companies. The fund fixed a ticket size of Rs 5 million. The PE will raise another USD 100 million by end of this year, said the person.
Dish TV hopeful of reducing losses in coming quarters
Direct-to-home (DTH) service provider Dish TV on October 27 said it will continue to reduce its losses in the coming quarters without disclosing a time frame by when it would start making net profit. The company reduced its net loss by two thirds to Rs 561.3 million during the quarter ended September, over the year ago period, due to reduction in distribution and content costs besides adding new subscribers.
Its total revenues grew 48.5 % to Rs 2.57 billion compared to Rs 1.73 billion in the same period last year as it added 4.07 lakh new subscribers in the quarter to take the gross subscriber numbers to 59.19 lakh.
Binani Cement may acquire Turkish co for Rs 10 bn
Binani Cement is in talks to acquire a cement firm in Turkey for around Rs 10 billion as part of its strategy to more than double its production capacity by two years. It is learnt that the target company has an annual production capacity of 2 million ton and the deal is likely to be sealed by March next year.
It is believed that the Binani board last week approved the foreign acquisition which would be financed equally by internal accruals and debt. Rajasthan-based Binani has been working on a plan to scale up its annual capacity from 6 million ton to 14 million tonne by 2011-12.
Birla Corp examines overseas acquisitions
The M P Birla group flagship Birla Corporation is examining overseas acquisitions. The company is examining opportunities to buy out cement manufacturing companies in the emerging markets but nothing has been finalized as yet.
Birla Corporation`s newly-appointed chairman Harsh Vardhan Lodha said, ``The company also plans to invest Rs 23.50 billion to enhance its annual cement manufacturing capacity to 11.5 million tons over the next four years.``
Wockhardt hospitals` acquisition to be over by December: Fortis
Hospital chain Fortis Healthcare on Tuesday said that the acquisition of ten hospitals from rival Wockhardt Hospitals for Rs 9.09 billion announced recently, will be completed by December and will start contributing to the financials from the next quarter.
Fortis` net profit grew 23% to Rs 130 million for the second quarter ended September over the year ago period, driven by higher revenues from its larger hospitals. The company`s revenues rose 21% to Rs 19.05 billion from Rs 15.80 billion in the corresponding quarter last fiscal.
Vishal Retail in biz rejig mode, to raise Rs 1.5 bn
Vishal Retail is in talks with two potential investors, including a retailer, in a move that may see the exit of current promoter RC Agarwal from the company and possibly mark the first distress sale in the Indian organized retail space.
Vishal Retail, which faces a debt liability of Rs 7.3 billion, is working on bringing in a strategic investor as part of pre-conditions laid down by lenders for corporate debt restructuring (CDR).
Idea Cellular to invest Rs 45 bn on expansion
Idea Cellular, the Aditya Birla Group`s telecom arm, will pump in around Rs 45 billion this fiscal for expanding operations to cover all the 22 telecom circles in the country.
``We now have presence in 20 circles. We will soon launch operations in Assam and the North-east to make our presence felt in all 22 telecom circles, `` Idea`s operations director Ambrish Jain said.
Market may extend last two days losses on weak Asia
The market may extend last two days of losses on weak Asia. The Reserve Bank of India (RBI) laying the groundwork on Tuesday in its monetary policy for a rise in interest rates by tightening credit to the commercial property sector, lifting its inflation forecast and warning of the threat of asset price bubbles may further weigh on investor sentiment. The RBI had pumped in massive liquidity in the banking system in the past one year or so to help revive the domestic economy in the aftermath of the global financial crisis.
Volatility may remain high on the bourses this week as traders rollover positions in the derivatives segment from October 2009 series to November 2009 series ahead of the expiry October 2009 contracts on Thursday, 29 October 2009.
HCL Technologies will be in action after its net profit rose 18.5% to Rs 300.75 crore in Q2 September 2009 over Q2 September 2008. Its net profit rose 55.87% to Rs 300.75 crore in Q2 September 2009 over Q1 June 2009. The results were announced before market hours today.
ACC, Ambuja Cements, Cipla, GAIL, HPCL, Sun Pharma, BoB, Firstsource, Gammon Infra, Hexaware, India Cements, Power Grid, Puravankara, Shree Cem, Tata Metaliks, Tata Tea among others will announce their Q2 September 2009 result today.
The Reserve Bank kept its benchmark lending and borrowing rates on hold at a quarterly monetary policy review on Tuesday, 27 October 2009. It also kept steady cash reserve ratio (CRR) at 5% but raised the statutory liquidity ratio to 25% from 24% with effect from 7 November 2009. Funds in CRR fetch no return for banks, while returns from SLR are small.
The RBI kept 2009/10 GDP forecast at 6% with upside bias and said it sees modest decline in agriculture. The RBI raised projection of inflation to 6.5% with an upside bias at end March 2010 from earlier 5%.
The central bank warned of possible asset price bubbles, raised banks' provisioning requirements for commercial real estate loans and lifted inflation forecast. The central bank said the precise challenge for the Reserve Bank of India is to support the economic recovery process without compromising on price stability. Growth drivers warrant a delayed exit, while inflation concerns call for an early exit, it said. Premature exit will derail the fragile growth, but a delayed exit can potentially engender inflation expectations, the RBI said.
The RBI said it will continue to monitor the price situation in its entirety and will take measures as warranted by the evolving macroeconomic conditions swiftly and effectively. It said it is mindful of its fundamental commitment to price stability. The central bank said the current large overhang of liquidity could engender inflation expectation even if credit demand remains subdued.
The central bank said the policy dilemma for India is different in some important respects from that of advanced economies as also other emerging market economies. It said India is confronted with an upturn in inflation, with rising headline inflation and stubbornly elevated consumer price inflation. According to RBI, most advanced economies and emerging market economies do not face an immediate risk of inflation. In several advanced economies, the concerns are about a possible deflation which are just about waning, it said
Asian stocks fell on Wednesday as losses at National Australia Bank and Canon Inc.'s lower profit raised concern about the strength of the global recovery. The key benchmark indices in China, Hong Kong, Japan, South Korea, Singapore and Taiwan fell by between 0.56% to 2.04%.
US markets ended mixed on Tuesday on the back of a disappointing confidence report. The technology sector was under pressure following downside guidance from internet search engine baidu.com. Consumer-discretionary and tech stocks declined but the energy stocks rose along with oil prices. The Dow rose 14.21 points, or 0.1%, to 9,882.17. The S&P 500 index fell 3.54 points, or 0.3%, to 1,063.41, while Nasdaq fell 25.76 points, or 1.2%, to 2,116.09.
Back home, the key benchmark indices tumbled on Tuesday after the Reserve Bank of India withdrew emergency liquidity support measures that were implemented in the aftermath of the global financial crisis. The BSE 30-share Sensex shed 387.10 points or 2.31% to 16,352.40 on that day.
As per provisional figures on NSE, foreign funds sold shares worth Rs 548.77 and domestic funds bought shares worth Rs 141.56 crore on Tuesday.
The supply of paper by Indian firms appear limitless, raising concerns that additional share sales will suck liquidity from the secondary equity market. As per reports, Indian firms have garnered about $9 billion (Rs 32,400 crore at the current exchange rates) through sale of shares and convertible bonds to institutional buyers since April 2009. Indian companies are taking advantage of a surge in liquidity to recapitalize and fund capital expenditure after being starved of cash last year.
Most of these companies - from industries ranging from liquor and spirits to infotech - issued equity shares to a select group of investors by way of qualified institutional placement or QIP. If the enabling resolutions passed by the companies are any indication, Indian firms are gearing up to raise $15 billion (Rs 69,427 crore) in the next six months. The list includes Hindalco (Rs 2,900 crore), JSW Steel ($1 billion), India Cements ($100 million), Essar Oil ($2 billion), Tata Steel (Rs 5,000 crore), Jet Airways ($ 400 million) and Bharat Forge ($150 million).
Unlisted Reliance Infratel announced on 22 September 2009 its intention to raise Rs 5,000 crore from the primary market. Divestment of state-run firms by the government may also increase the supply of paper in the market.
The government recently approved stake sales in state-run power producer NTPC and another unlisted power firm Satluj Jal Vidyut Nigam which reflects the country's resolve to speed up reforms and raise more resources for social schemes. On Monday, Trade Minister Anand Sharma said the Union Cabinet had approved a 5% stake sale in NTPC, and 10% in, an unlisted power producer. On 16 October 2009, Prime Minister Manmohan Singh said many state-run firms are eager to list their shares in the stock market as it would help unlock their value.
The government has approved a follow-on public offering of 20% of state run Steel Authority of India, the steel minister said on Wednesday, 21 October 2009. The Government of India owns nearly 86% of Sail.
Crude surpasses $79
Prices rise on inventory report anticipation
Crude prices ended higher at Nymex on Tuesday, 27 October, 2009. Prices rose as traders anticipated that tomorrow's weekly inventory report will show drop in crude product inventories.
On Tuesday, crude-oil futures for light sweet crude for December delivery closed at $79.55/barrel (higher by $0.87 or 1%). Last week, crude ended higher by 3.4%.
For the month of September, 2009, crude ended higher by a marginal 0.9%. For the third quarter, crude ended higher by just 1%. Crude prices had rallied 40% and 11.3% in the second and first quarter of 2009 respectively.
Oil prices had reached a high of $147 on 11 July, 2008 but have dropped almost 58% since then. Year to date, in 2009, crude prices are higher by 57.8%.
In the currency market on Tuesday, the dollar index, which calculates the strength of the dollar against a basket of six other currencies reversed its course after dropping earlier during the day. Last week, it had dropped to fourteen month lows.
Among other energy related products, gasoline for November delivery rose 4 cents, or 1.9%, to $2.07 a gallon. November heating oil also rose 4 cents to $2.06 a gallon.
Also on Tuesday, Natural gas for November delivery rose 5 cents, or 1.1%, to $4.56 per million British thermal units.
Crude prices had ended FY 2008 lower by 54%, the largest yearly loss since trading began at Nymex.
At the MCX, crude oil for November delivery closed higher by Rs 11 (0.3%) at Rs 3,712/barrel. Natural gas for November delivery closed higher by Rs 2.8 (0.85%) at Rs 248.4/mmbtu.
Bears dominate
Nifty has broken two crucial supports ie 4945 and 4920, after which as expected, the panic spread across all the sectors. Momentum indicators also favour bears. On the higher side, the lower end of the parallel channel at 5100 remains a major resistance. The high of 5055 also remains a strong resistance. On the lower side, the next support exists at 4780-4750, which again is crucial, as when it will be broken the selling pressure will be intense. So, overall we maintain our bias down in the short term for the target of 4750.
On the daily chart, Nifty is trading below its 20-daily moving average (DMA) and 40DMA at 5030 and 4920 respectively, which are resistances in the near term. The momentum indicator (KST) has given a negative crossover and is trading below the zero line. The market breadth was negative with 112 advances and 1,176 declines on the NSE and 495 advances and 2,365 declines on the BSE.
On the hourly chart, Nifty is trading below its 20-hourly moving average (HMA) and 40HMA at 4978 and 5038 respectively, which are now resistances in the short term. The momentum indicator (KST) has a given negative crossover and is trading below the zero line.
Nifty and the Sensex closed in red losing 124 and 387 points respectively. Of the 30 Stocks of the Sensex Wipro (up 2.18%) and Dr Reddy’s Laboratories (up 1.58%) were the top gainers while Hindalco Industries (down 7.92%) and TISCO (down 7.26 %) were the top losers.
Precious metals drop again
Prices turn paler as dollar reverses its course
Precious metal prices ended lower on Tuesday, 27 October, 2009. Prices fell due to the rebounding dollar which rose due to the weak consume confidence report.
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 and also vice versa.
On Tuesday, gold for December delivery ended at $1,035.4, lower by $7.4 (0.7%) an ounce on the New York Mercantile Exchange. Last week gold ended higher by 0.5%. Last week, gold had registered record highs quite a few times reaching an all time high of $1071. Year to date, gold prices are higher by 17.6%.
Gold ended September, 2009 higher by 5.9%. For the third quarter it ended higher by 8.7%. Before this, for the second quarter, gold ended higher by 0.5%. The metal had gained 4.3% in the first quarter of this year.
On Tuesday, December Comex silver futures ended lower 56 cents (3.2%) at $16.54 an ounce. Last week, silver ended higher by 1.7%.
Silver ended 11.8% higher for September, 2009. Year to date, silver has climbed 53.1% this year. For 2008, silver had lost 24%.
In the currency market on Tuesday, the dollar index, which calculates the strength of the dollar against a basket of six other currencies reversed its course after dropping earlier during the day. Last week, it had dropped to fourteen month lows.
In 2008, gold prices ended higher by 5.5%. The dollar index had gained 12% that year.
At the MCX, gold prices for December delivery closed lower by Rs 34 (0.21%) at Rs 15,857 per 10 grams. Prices rose to a high of Rs 15,890 per 10 grams and fell to a low of Rs 15,810 per 10 grams during the day's trading.
At the MCX, silver prices for December delivery closed Rs 589 (2.2%) lower at Rs 26,255/Kg. Prices opened at Rs 26,900/kg and fell to a low of Rs 26,200/Kg during the day's trading.
Daily News Roundup - Oct 28 2009
Infosys BPO, a subsidiary of IT major Infosys, signed an agreement with the Andhra Pradesh government to set up rural BPO centers in 22 districts of the state. (ET)
Bhilai Steel Plant, the flagship entity of the SAIL, has been awarded mining lease for the Rowghat deposit-F spread over 2,029 hectares in a pocket between Kanker and Narayanpur districts of Chhattisgarh. (BS)
UK based First State Investment Management has hiked its stake in Mahindra Satyam to 5.02%. (FE)
Temasek Holding’s reduced its stake in ICICI Bank by 1.85%. (FE)
Glenmark Pharmaceuticals group company Glenmark Generics (Europe) has launched four products in the UK. (ET)
Dr. Reddy’s Laboratories sees huge opportunities in biosimilars to drive its future growth. (BL)
Out of the Rs45bn investments planned in FY10, Idea plans to invest Rs15bn for expanding base in Bihar, Jharkhand and Orissa and launching services in West Bengal. (BL)
Sun TV Network is looking for foreign partners to produce non-fiction contents, announced its tie up with Dutch firm Endemol to launch a television game show. (BS)
The Bombay high court asked Kingfisher Airlines to deposit Rs360mn against its dues payable to Lufthansa Technik. (FE)
PTC India Financial Services, a newly-formed arm of trading major PTC India, sanctioned funds to 10 power projects aggregating around Rs6.3bn during April-September. (BL)
Apart from looking at overseas opportunities for acquisition of cement facilities, Birla Corporation plans to set up a 1mn ton cement plant in Assam for an investment of Rs5bn. (BL)
Binani Cement is in talks to acquire a cement firm in Turkey for around Rs10bn as part of its strategy to more than double its production capacity by two years. (ET)
The board of Lanco Infratech approved a stock split from Rs10 to Re1 face value. (BS)
Intel, along with HCL Infosystems, on Tuesday announced the launch of the first of WiMax-enabled nettops and laptops in the country. (ET)
Intel partners with HCL Infosystems and BSNL to implement the WiMax acceleration program to adopt new initiatives to expand access to wireless broadband internet. (BL)
Elecon Group plans to invest Rs4bn to diversify into developing recreational, sports and residential properties. (BL)
Hyundai Motor India has filed a case against Mahindra Renault objecting the latters plan to launch a compact car with the name "Sandero", alleging that the rival was trying to cash in on its popular Santro brand with similar sounding product. (BS)
Shipping Corporation of India has outlined a US$4bn capex to expand its fleet of vessels by 2012. (ET)
Kolkata based Jai Balaji Industries further raised Rs2bn through a QIP, following its Rs2.7bn private placement in February 2008. (BS)
Private equity majors Citi Ventures, Sequoia Capital and Bessermer Venture Partners have invested US$100mn in Ind-Barath Power Infra. (ET)
SoftBank, a Japanese telecommunications and media company, is all set to become an anchor investor in DEN Networks, the multi-services operator. (BS)
Avesthagen, a Bangalore-based life sciences firm, will license its patented technologies to develop, produce and market seeds nationally and internationally to the newly formed JV with Limagrain, a French international co-operative group, Atash Seeds Pvt Ltd. (BS)
RBI left key rates unchanged, resorted SLR to 25%, tightened norms for loans to commercial real estate and asked banks to increase cover for sticky assets. (BS)
EGoM, headed by the finance minister, allocated additional 50mmscmd of gas that RIL would produce beyond the initial 40mmscmd, bulk of which will be allocated to the power sector. (BS)
Uttarakhand Power Corporation has proposed privatization of distribution at Roorkee in Haridwar and Rudrapur in Udham Singh Nagar district where T&D losses and power thefts are heavy. (BS)
India’s new defense procurement policy will allow domestic private producers to bid for armed forces equipment tenders and allows them to join hands with foreign manufacturers for co-production through JV’s. (BS)
The Information Technology (Amendment) Act 2008, aimed at tightening procedures and safeguards to monitor and intercept data to prevent cyber crimes, comes into effect from today. (BS)
The CBI has alleged that the grant of ‘Unified Access Service Licences’ for 2G spectrum to some private companies caused a loss of over Rs220bn to the government. (BS)
Karnataka government which initiated work on the states first gas based power project with a capacity of 2,100MW plans to develop four more such projects with a combined capacity of 8,000MW. (BS)
RBI mandated loan loss coverage ratio of 70% would affect banks profits over the next four quarters. (BS)
Cane growers in Uttar Pradesh plan to launch an agitation from Thursday demanding higher prices for the crop to be crushed in the mills in the 2009-10 season. (BL)
Originators of securitized debt will have to retain a tenth of the total assets securitized, as part of the central bank’s objective to bring greater transparency to the market. (ET)
Banks told to set aside 5% of funds under CBLO. (ET)
The department of telecommunications will start the 3G spectrum auction process from January 14, 2010. (FE)
Market may turn accommodating
The possibilities are numerous once we decide to act and not react.
After reaction, its time for some action now. The market appears to have made a hasty exit just as the RBI tone signaled the beginning of the end of easy monetary policy. A few surprisingly hawkish steps and comments unveiled in the RBI’s mid-year policy review set the cat among the pigeons. A hike in SLR, some tightening of lending norms and hike in inflation expectation sent a clear message that the soft corner shown during the economic upheaval will no longer be available. But, the market may have overreacted. What made the matters worse were persistent weakness in global markets and a couple of less enthusiastic numbers.
So, expect a bounce back though the start may still be a nervous one due to mixed external trend. RIL will announce its results tomorrow and numbers could match expectations as there is usually some treasury gain to bank on. With F&O expiry just a day away, further short covering could set in. Nifty Nov futures managed to end at a slight premium to the spot Nifty price.
Results Today: ACC, Ambuja Cements, Anant Raj, Andhra Bank, BOB, BEML, Bombay Dyeing, Chennai Petro, Cipla, EIH, Essel Propac, GAIL, Gammon Infra, GNFC, HCL Tech, Hexaware, HPCL, Hotel Leela, India Cement, Ingersol Rand, Jain Irrigation, LMW, MRPL, Marico, Mercator Lines, Shree Cement, Sun Pharma, Sun TV, Tata Tea, Thomas Cook, Usha Martin and Zicom.
FIIs were net sellers in the cash segment on Tuesday at Rs5.49bn on a provisional basis. The local funds were net buyers of Rs1.42bn, according to figures published on the NSE's web site. In the F&O segment, the foreign funds were net sellers at Rs15.94bn. On Monday, the foreign funds were net buyers of Rs1.9bn in the cash segment. Their net investments in Indian stocks this year is above $14bn. Mutual Funds were net sellers at Rs3.61bn on Monday.
US stocks closed mixed on Tuesday with Dow Jones Industrial Average managing slim gains and the Nasdaq Composite finishing in the red. A rally in energy space and a surprise drop in consumer confidence provided a competitive backdrop to the day.
A better-than-expected housing market report and a strong response to the government's latest debt auction were also in the mix.
The Dow gained 14 points, or 0.1%, to 9,882.17. The S&P 500 index rose 3 points, or 0.3%, to 1,063.41. But the Nasdaq lost 26 points, or 1.2%, to 2,116.09.
Since peaking at rally highs a week ago, the Dow has lost 2.3%, the S&P 500 has lost 3.4% and the Nasdaq has lost 3.4% through Tuesday's close.
Although the S&P 500 is up 57% from the March bottom, when it hit a 12-year low, the broad average is still down 32% from its all-time high of October 2007.
Weakness in banks, techs, retailers and transportation stocks dragged down the Nasdaq and limited the rest of the market from moving much. A rally in heavily weighted Dow components Chevron, Exxon Mobil, DuPont and American Express kept the blue-chip measure afloat.
US stocks had tumbled on Monday, with the Dow dropping 100 points for the second day in the row. A spiking dollar hit commodity shares and other stocks that benefit from a weak US currency.
The dollar and commodity prices remained in focus Tuesday as well. But investors also looked to the economic news ahead of Thursday's highly anticipated gross domestic product (GDP) report.
Energy was the strongest sector on the day, as investors reacted to a smattering of financial reports and the impact of the US dollar.
European oil behemoth BP reported weaker quarterly earnings and revenue due to lower oil prices, but the results topped analysts' estimates. BP's US-traded shares rose 4%.
Valero Energy, the largest US oil refiner, reported a bigger-than-expected quarterly loss, with fuel demand suffering amid the sluggish economy. Shares fell 4.3%.
Nonetheless, a variety of energy stocks rallied, including Dow components Chevron and Exxon Mobil.
Raw commodity prices were higher as well, despite a mixed dollar. Typically a weak dollar boosts dollar-traded commodity prices and a strong dollar pressures prices.
Consumer sentiment took a plunge in October, according to a Conference Board report released after the start of trading. The Consumer Confidence index fell to 47.7 in October from a revised 53.4 in September, reflecting the impact of rising joblessness and shrinking household wealth. Economists thought the index would rise to 53.5.
The part of the index that measures how consumers rate the present economic situation fell to 20.7 in October from 23 in September. It was the lowest level since February 1983, when it stood at 17.5.
Home prices rose for the fourth month in a row in August, according to the S&P Case-Shiller Home Price index of the 20 largest metropolitan areas. Prices also showed the smallest year-over-year declines in nearly 2 years. Prices rose 1.2% in August after climbing 1.6% in July. Versus a year ago, prices were down 11.3%, but that was shy of the 11.9% drop economists were expecting.
With 230 companies, or 46%, of the S&P 500 having already reported results, profits are on track to have fallen 18.1% from a year ago, according to the latest from Thomson Reuters. Results have largely topped forecasts, with 80% of companies beating earnings' estimates, 6% meeting expectations and 13% missing forecasts.
The dollar gained versus the euro, after falling to a 14-month low last week. But the greenback fell versus the yen.
US light crude oil for December delivery rose 87 cents to settle at $79.55 a barrel on the New York Mercantile Exchange.
COMEX gold for December delivery fell $7.40 to settle at $1,035.40 an ounce. Gold has surpassed records repeatedly this month due to the weak dollar and longer-term worries about inflation.
Treasury prices rallied, lowering the yield on the 10-year note to 3.47% from 3.55% late on Monday. Gains accelerated after the government saw strong demand for its sale of $44 billion in 2-year notes.
European stocks closed higher in a choppy session, as weaker-than-expected US consumer confidence data contrasted with better-than-expected results from oil giant BP. The pan-European Dow Jones Stoxx 600 index finished with a rise of 0.3% to 242.56.
The UK's FTSE 100 index rose 0.2% to 5,200.97, while the French CAC-40 index finished fractionally lower to 3,734.95 and Germany's DAX index declined 0.1% to 5,635.02.
Indian markets witnessed a sharp dent dropping the most in two months on a hawkish RBI tone in the Monetary Policy. The central bank’s move to tighten liquidity and an upward revision in inflation forecast triggered a heavy sell-off on the bourses. Weak global cues and disappointing quarterly earnings announced by select leading Indian companies further dampened the sentiment on Dalal Street.
The interest rate sensitive like the Banking and the Realty stocks were offloaded the most. Apart from the index heavyweights, even the Mid-Cap and the small-Cap stocks were hammered by the bears.
Markets saw the highest turnover ever in the F&O segment on a non-expiry day and third highest volumes in the overall market.
Technically, the NSE Nifty was seen taking support at the 4545 levels which is also the 50 Day moving average for the index. If the crucial support level is taken out, 4720-4730 levels which have acted as an important resistance in the past would be the next support.
The BSE Sensex fell 387 points at 16,353 after touching a high of 16,699 and a low of 16,311. The index opened at 16,699 against the previous close of 16,740. The NSE Nifty fell 124 points to shut shop at 4,847.
In Asia, the Nikkei in Japan was down 1.4%, while Australia's S&P/ASX ended lower by 1.6% at 4,753. Shanghai SE Composite fell 2.8% and Hang Seng index in Hong Kong fell 2%.
In Europe, stocks were in the positive terrain. The FTSE in the UK was up 0.3%, The DAX in Germany was up 0.3% and the CAC 40 index in France was up 0.2%.
Coming back to India, among the BSE sectoral indices, the Realty index was the top loser, shedding 6.2%, followed by the Metals index that was down 6% and the BSE Banking index was down 4%.
The BSE Mid-Cap index fell 3.7% and the BSE Small-Cap index was down 4.4%.
Among the 30-components of Sensex, 23 stocks ended in the red and 7 ended in the positive terrain. Hindalco, Tata Steel, Bharti Airtel, RCom, DLF and ICICI Bank were among the major losers.
On the other hand, among the major gainers were Wipro, Hindustan Unilever, Tata Motors and Grasim.
Outside the frontline indices, the big losers in the broader market were Sesa Goa, Areva Jet Airways and Sterling Biotech. On the other hand, gainers included PTC, Union Bank, Cadila and Apollo Hospital.
Tata Steel Q2 net profit fell 49% YoY to Rs9.03bn as against Rs17.9bn in the same period last year. Q2 Net sales dropped 16% YoY to Rs56.3bn as against Rs67.3bn.
Shares of Tata Steel plunged over 7% to Rs501. The stock opened at Rs534 and made an intra-day high of Rs534 and a low of Rs495. Total traded volumes stood at 3.6mn shares.
The telecom stocks continued to remain under pressure as the CBI probe on the Indian telecommunication ministry and the private operators in connection with alleged irregularities in allocation of spectrum to new operators prolong.
"It has been alleged that there had been serious irregularities in the award of Unified Access Services Licenses to private companies," CBI said.
The CBI has carried out searches to collect "incriminating documents in the Wireless Planning Cell, and in the office of deputy-director general for Access Services, Sanchar Bhawan, Ashoka Road".
Bharti Airtel lost 7%, RCom fell 6.5% and Idea declined 4.5%.
Shares of DLF further lost ground after the income-tax department gave a notice to the company asking it why its accounts for fiscal year 2007 should not be subjected to a special audit by an independent auditor.
The I-T department calls for a special audit when officials assessing a company’s tax returns suspect the tax liability has been understated.
However, according to reports, a DLF spokesman termed the new notice as a routine follow-up. “The due legal process is on, and our appeal on last year’s assessment is sub judice in the I-T department. DLF is sure of its facts and figures, which will be duly considered in the appeal.”
The stock declined over 10% in the past four trading sessions. On Tuesday, it was down 6.5% to Rs401; it opened at Rs420 and made an intra-day high of Rs425 and a low of Rs399. Total traded volumes stood at 3.9mn shares.
Shares of Power Finance zoomed from days low after the company registered a growth of 95% YoY with net profit of Rs6.37bn for the quarter ended September 30, 2009 as compared to Rs3.29bn for the quarter ended September 30, 2008.
Total Income increased from Rs16.02bn for the quarter ended September 30, 2008 to Rs20.46bn for the quarter ended September 30, 2009.
The stock ended flat at Rs227, it opened at Rs228 and made an intra-day high of Rs236 and a low of Rs216. Total traded volumes stood at 0.76mn shares.
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