Sunday, July 31, 2011
Short Reliance Industries
Reliance Industries: The outlook for Reliance Industries seemed to be negative as it ended below the crucial support level last week.
The stock now finds immediate resistance at Rs 1,047 and only a conclusive close above Rs 1,141 would change the outlook to positive for stock.
The next support level appears at Rs 694, and it seems the stock is heading towards the support level.
A close below Rs 694 could weaken the stock to Rs 549.
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Should you continue with SIPs or STPs ?
The stock market has been on a roller coaster all year. While in the short run markets mostly overreact both ways, over a sufficiently long period of time, if the economy is growing, the broad index rises above the inflation rate.
Investors who enter the market for the short run are usually speculators. Long-term investors never time the market, but there are times when even for them, the stage looks set for either a lump sum investment or padding up their existing systematic investment plans (SIPs). Market trends we analysed and experts we spoke to confirm that such a time may indeed be now.
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ICICI Bank - back to growth, can it sustain ?
Bank maintains NIMs at 2.6 per cent in Q1, advances up 20 per cent.
ICICI Bank is known to do things differently. So, it’s not surprising that when other banks are trimming their loan books sequentially to hold on to profitability, ICICI Bank, India’s largest private sector bank, is growing its books. At the end of the first quarter of FY12, advances increased 20 per cent year-on-year to Rs 2,20,693 crore from Rs 1,84,378 crore in the corresponding period of the previous year. Savings deposits increased 18 per cent to Rs 66,858 crore. While the industry faces a widespread decline in demand deposits, the bank’s Casa ratio at stood at 41.9 per cent in Q1FY12.
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Is all well with online term insurance plans?
‘Online term plan’ is a new concept that has grabbed attention due to premiums that are amazingly low compared to other plans. But, before you fall for the charms of low-priced term plans, think about the many issues that are not so apparent.
If one cell-phone model costs Rs5,000, and another, with the same features, costs Rs12,000, it is not hard to see which one you would go for. But if one insurer charges Rs5,000 as premium for a term plan and another insurer charges Rs12,000 for a plan with similar features, what would you do? Your instinct would prompt you to go for the cheaper one. But wait till you read the whole story.
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ICICI Bank GTL Stake
ICICI Bank has assumed a 29.3 percent stake in debt-laden Indian telecom infrastructure companyGTL after taking over 28.5 million shares pledged by its promoter, a source with direct knowledge of the matter told Reuters.
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Watch out for Tata and Anil Ambani stocks
Overseas investors have dumped Reliance Industries shares worth an estimated Rs 1,000 crore in this fiscal, but have made net purchase worth an equivalent amount in thestocks from the Tata and Anil Ambani groups.
The holding of foreign institutional investors (FIIs) in Mukesh Ambani-led RIL fell from 17.7 per cent to 17.37 per cent during the current fiscal's first quarter ended June 30.
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Exit Consumer Stocks ?
Even as it has taken a cynical view of most other investment ideas, the stock market has pursued the consumption theme with single-minded devotion over the last two years. Sectors such as fast moving consumer goods (FMCGs), retail, white goods, foods, fitness — all things, in fact, that cater directly to the ravenous appetite of the young Indian consumer — have seen their stock prices zoom. Price-earnings multiples have expanded, with institutional investors making a beeline to accumulate them.
More on Hindu Business Line
Cognizant to acquire CoreLogic India Operations
Cognizant, a leading provider of information technology, consulting, and business process outsourcing services, and CoreLogic, a leading provider of information, analytics, and business services, announced a definitive agreement under which Cognizant will acquire CoreLogic Global Services Private Limited (CoreLogic India), the India-based captive operations of CoreLogic. The purchase price will consist of a cash payment of approximately $50 million, plus adjustments for working capital and other charges or credits which will be determined at closing. As part of the transaction, CoreLogic and Cognizant will enter into a services agreement with a minimum revenue commitment of $324 million, plus applicable inflation adjustments, over five years with various renewal and extension rights, under which Cognizant will provide a range of services to CoreLogic globally.
Monsoon rains 23% below normal in week to July 27
Southwest monsoon was 23% below normal in the week ending July 27, a steep decline from the 7% above average rains received in the previous week, the Indian Meteorological Department (IMD) said on Thursday. The rains were poor during last week over rice and cotton areas of south and western India. The weather office's overall forecast, made around a month ago, expected the rains to be slightly below normal for the entire June to September season. Last year, rainfall was 38% above normal in the week ended July 28, after a weak start in June, and ended the four-month season as normal. Widespread rain/thundershowers would occur over west coast and Andaman & Nicobar Islands up to 31st July, the IMD said . Fairly widespread rain/thundershowers would occur over northwest India, Bihar, subHimalayan West Bengal & Sikkim, northeastern states and Lakshadweep. Scattered rain/thundershowers would occur over remaining parts of the country, except extreme peninsular India. Heavy to very heavy rainfall would occur at a few places over Jammu & Kashmir, Himachal Pradesh, Uttarakhand, Uttar Pradesh, Bihar and subHimalayan West Bengal & Sikkim during the next 48 hours, the weather bureau said. Isolated heavy rainfall would occur over Assam & Meghalaya, Arunachal Pradesh, Konkan & Goa, coastal Karnataka, Kerala, Lakshadweep and Andaman & Nicobar Islands, it added. Fairly widespread rainfall would occur up to 2nd August over many parts of the country, except parts of northwest, east and peninsular India where it would be scattered.
SEBI approves new takeover code...Unveils several other measures
Capital markets regulator SEBI formally gave a green light to the new takeover regulations proposed by the Takeover Regulation Advisory Committee (TRAC). As per the proposed new norms, a company can acquire up to 25% in a company without requiring to make an open offer. The new takeover code also raises the open offer size from a minimum of 20% at present, to 26%. Under current regulations, if an investor buys more than 15% in another company, it has to make a mandatory open offer for a further 20% stake. In addition, removal of the non-compete fee will ensure that all shareholders of the target firm are treated fairly. While most of the recommendations by the C. Achuthan panel have been accepted, SEBI turned down the committee’s suggestion on the 100% open offer. The TRAC had recommended open offer for 100% of the target company's shares.
RBI hikes rates by 50 bps to check inflation
The Reserve Bank of India (RBI) on July 26 raised the key policy rates - the repo rate and the reverse repo rate - by a larger-than-anticipated half a percentage point, as it persists with its efforts to tame the inflation monster notwithstanding some moderation in economic growth. So, the repo rate now stands at 8% and the reverse repo rate is at 7%. There has been no change in the Cash Reserve Ratio (CRR), which stands at 6%. The bank rate has been retained at 6%. The Marginal Standing Facility (MSF) rate, determined with a spread of 100 bps above the repo rate, stands recalibrated at 9% with immediate effect.
Weekly Stock Picks - July 31 2011
Buy Satyam Comp
Buy Ranbaxy
Buy Sintex Industries
Buy United Phosphorous
Buy PowerGrid
Weekly Newsletter - July 31 2011
An eventful week ended on a steady note. RBI’s 50 bps rate hike stunned one and all. The central bank policymakers also maintained a hawkish tone. So, more tightening is likely in the coming months, especially if inflation remains stubborn.
Saturday, July 30, 2011
Markets fall 3% on rate hike, US debt fears
Investors fretted over US debt woes and slowing domestic growth after RBI’s aggressive rate hike, which led to a negative closing for the week
Major news for the week
RBI hikes repo, reverse repo by 50 bps
Food inflation at 7.33% versus 7.58%
ICICI Bank consolidated net profit soars 53% in Q1
RIL Q1 net profit at Rs5,661 crore
SEBI raises open offer size to 26%
Term Insurance Claim Ratios
| Company | Claim Ratio (FY 2009-10) |
Aegon Religare | 48.00 |
Aviva Life | 87.11 |
ICICI Pru Life | 90.17 |
Friday, July 29, 2011
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Morgan Stanley Holdings
Company | %Holding | No of Shares (in Lakhs) | Rs Crore |
| Hinduja Foundries | 6.80 | 19.54 | 15 |
| Lloyd Electric and Engineering | 5.63 | 17.45 | 10 |
| Fedders Lloyd | 5.60 | 17.24 | 13 |
| Everonn Education | 4.32 | 8.29 | 46 |
| Money Matters Financial Services | 3.90 | 13.59 | 15 |
| Stride Arcolab | 3.57 | 20.69 | 77 |
| Megasoft | 3.22 | 14.27 | 3 |
| Federal Bank | 3.16 | 54.13 | 230 |
| Sobha Developers | 3.07 | 30.12 | 78 |
| Kanoria Chemicals and Industries | 3.03 | 17.03 | 7 |
| South Indian Bank | 2.94 | 332.11 | 78 |
| Lakshmi Energy and Foods | 2.89 | 18.26 | 6 |
| Greenply Industries | 2.81 | 6.77 | 16 |
| NIIT Technologies | 2.55 | 15.11 | 34 |
| Kalpataru Power Transmission | 2.53 | 38.76 | 50 |
| Welspun Corp | 2.39 | 48.98 | 73 |
| S Kumars Nationwide | 2.26 | 64.38 | 36 |
| Piramal Healthcare | 2.19 | 36.62 | 140 |
| Riddhi Siddhi Gluco Biols | 2.12 | 2.37 | 9 |
| ING Vysya Bank | 2.11 | 31.54 | 111 |
| Sasken Communication Technologies | 1.90 | 4.86 | 6 |
| Jubilant Foodworks | 1.84 | 11.87 | 101 |
| Aptech | 1.76 | 8.61 | 12 |
| Prism Cement | 1.74 | 87.78 | 40 |
| ESS DEE Aluminium | 1.71 | 5.50 | 20 |
| Bank Of Baroda | 1.71 | 67.10 | 589 |
| SRF | 1.66 | 9.95 | 32 |
| Zenith Infotech | 1.55 | 1.96 | 4 |
| Take Solutions | 1.54 | 18.89 | 7 |
| Redington (India) | 1.51 | 59.97 | 58 |
Rakesh Jhunjhunwala - Updated Holdings
Company | %Holding | No of Shares (in Lakhs) | Rs Crore |
| A2Z Maintenance and Engineering Services | 17.22 | 127.73 | 329 |
| Viceroy Hotels | 10.02 | 42.50 | 15 |
| Geojit BNP Paribas Financial Services | 7.88 | 180.00 | 40 |
| CRISIL | 7.75 | 5.50 | 454 |
| Praj Industries | 7.39 | 136.54 | 113 |
| Titan Industries | 7.28 | 646.67 | 1,477 |
| Ion Exchange (India) | 6.48 | 8.75 | 13 |
| Zen Technologies | 5.06 | 4.50 | 6 |
| Adinath Exim Resources Ltd | 4.59 | 1.89 | 0 |
| Agro Tech Foods | 4.52 | 11.01 | 47 |
| VIP Industries | 4.47 | 12.63 | 102 |
| Autoline Industries | 4.26 | 5.20 | 8 |
| Delta Corp | 3.72 | 75.00 | 79 |
| Rallis India | 3.25 | 6.31 | 10 |
| Rallis India | 3.23 | 6.28 | 10 |
| Titan Industries | 2.49 | 221.16 | 505 |
| Alphageo (India) | 2.43 | 1.25 | 2 |
| Reliance Broadcast Network | 2.20 | 17.50 | 15 |
| VIP Industries | 1.96 | 5.55 | 45 |
| NCC | 1.95 | 50.00 | 37 |
| A2Z Maintenance and Engineering Services | 1.89 | 14.00 | 36 |
| Subex | 1.80 | 12.50 | 7 |
| Lupin | 1.73 | 77.30 | 351 |
| Provogue (India) | 1.66 | 19.00 | 7 |
| Mcnally Bharat Engineering | 1.48 | 4.60 | 7 |
| Hindustan Oil Exploration Company | 1.38 | 18.00 | 31 |
| Hindustan Oil Exploration Company | 1.35 | 17.62 | 30 |
| Pantaloon Retail (India) - B-DVR | 1.32 | 2.11 | 4 |
| Hindustan Oil Exploration Company | 1.27 | 16.60 | 28 |
| Viceroy Hotels | 1.18 | 5.00 | 2 |
RBI's aggressive rate hike spooks market
The market slumped last week as a sharper-than-expected interest rate increase by the Reserve Bank of India (RBI) at a policy review on Tuesday, 26 July 2011, raised concerns that higher interest rates will pinch corporate profit growth. Nervousness in the global markets due to a US debt impasse also weighed on the domestic market.
The BSE Sensex slumped 525.10 points or 2.8% to 18,197.20 in the week ended Friday, 29 July 2011. The 50-unit S&P CNX Nifty shed 151.95 points or 2.69% to 5,482.
Auto, realty shares may extend losses on rising interest rates
Investors' focus continues on Q1 corporate earnings. Investors are focusing on the post-Q1 June 2011 result management commentary to gauge the future earnings outlook at a time when Indian firms are witnessing cost pressures amid rising interest rates and staff costs.
South India based television broadcaster Sun TV unveils Q1 results on Monday, 1 August 2011. State-run Power Grid Corporation unveils Q1 results on Tuesday, 2 August 2011. On Wednesday, 3 August 2001, telecom services major Bharti Airtel and United Spirits unveil first quarter results. On Thursday, 4 August 2011, Adani Power, Mundra Port And Special Economic Zone and Indian Hotels are set to announce first quarter results. Cipla and IL&FS Transportation Networks unveil first quarter results on Friday, 5 August 2011.
Markets end flat amid highly volatile session
The Indian markets remained flat at the close today after being shattered in previous three sessions
Major headlines
ICICI Bank consolidated net profit soars 53% in Q1
SAIL Q1 net profit down 29%
Idea Cellular Q1 consolidated net profit drops 12%
BSE Bulk Deals to Watch - July 29 2011
This data was last updated on Friday, July 29, 2011 5:04:03 PM
Deal Date Scrip Code Company Client Name Deal Type * Quantity Price **
29/7/2011 530027 Aadi Inds JAYESH MANNARLAL AJMERA S 50000 18.14
29/7/2011 590006 Amrutanjan Health-$ A K G SECURITIES AND CONSULTANCY LTD B 15538 875.77
NSE Bulk Deals to Watch - July 29 2011
Date,Symbol,Security Name,Client Name,Buy/Sell,Quantity Traded,Trade Price / Wght. Avg. Price,Remarks
29-JUL-2011,AMRUTANJAN,Amrutajan Health Ltd,CROSSEAS CAPITAL SERVICES PVT. LTD.,BUY,21813,877.29,-
29-JUL-2011,AMRUTANJAN,Amrutajan Health Ltd,RADHIKA DIPAN MEHTA,BUY,19287,875.96,-
29-JUL-2011,APTECHT,Aptech Limited,CROSSEAS CAPITAL SERVICES PVT. LTD.,BUY,342763,142.26,-
29-JUL-2011,APTECHT,Aptech Limited,JAINAM INVESTMENTS,BUY,394042,140.56,-
Nifty August 2011 futures at premium
Turnover tumbles
Nifty August 2011 futures were at 5,490.55, at a premium of 8.55 points over spot closing of 5,482. Turnover in NSE's futures & options segment tumbled to Rs 99820.86 crore from Rs 233519.13 crore on Thursday, 28 July 2011.
ICICI Bank August 2011 futures were at 1040, at a premium over spot closing of 1038.30.
L&T Finance Holdings IPO subscribed 5 times
Gets bids for 106.67 crore shares
The initial public offer (IPO) of L&T Finance Holdings was subscribed 4.97 times as on 17:00 IST on the third and final day of the bidding for the issue today, 29 July 2011. The IPO received bids for 106.67 crore shares, compared with 21.45 crore shares on offer.
The price band for the IPO was Rs 51 to Rs 59 per share. The proceeds of the IPO will be used for expansion plans of two of its subsidiaries--L&T Finance and L&T Infrastructure Finance. Rating agencies CARE and ICRA had assigned an IPO grade 5 to the company's IPO indicating that the fundamentals of the company are 'strong' relative to the other listed equities.
Sensex, Nifty at 5-week closing lows on US debt worries
Key benchmark indices reached five-week closing lows on weak global stocks. The market extended losses for the fourth day in a row in what was a choppy trading session. The market breadth, indicating the overall health of the market, was weak. US and euro-zone debt worries weighed on the sentiment as stocks fell across the globe. The BSE Sensex was down 12.32 points or 0.07%, up close to 65 points from the day's low and off close to 135 points from the day's high. Index heavyweight Reliance Industries (RIL) hit 52-week low amid high intraday volatility.
Grey Market Premiums - July 29 2011
| Company Name | Offer Price (Rs.) | Premium (Rs.) |
| Vaswani Ind. | 49 | 1.50 to 2 |
| Inventure Growth | 117 | 4 to 4.50 |
| L & T Finance | 51 to 59 | 3 to 3.50 |
Market may extend recent losses on weak Asian stocks
The market may extend three-day 3.5% losses on weak Asian stocks. Trading of S&P CNX Nifty on the Singapore stock exchange indicates a fall of 58 points at the opening bell. Asian stocks fell on Friday, 29 July 2011, as the US debt impasse kept broad market sentiment in check, with Japan also suffered from weak earnings and profit outlooks.
FIIs bought shares worth a net Rs 64.66 crore on Thursday, 28 July 2011, as per provisional data from the stock exchanges. Domestic institutional investors (DIIs) bought shares worth Rs 409.34 crore on that day. Key benchmark indices sank to their lowest closing levels in five weeks on Thursday, 28 July 2011 on fears that higher interest rates will hurt corporate profit growth. The BSE Sensex was down 222.73 points or 1.21% to settle at 18,209.52, its lowest closing level since 23 June 2011.
Markets may open in red
Weak Asian cues may drag the Indian markets in the opening trade, extending previous sessions losses.
Headlines for the day:
SEBI pleases all, overhauls key Takeover Code clauses
PNB to buy 30% in Metlife India
JSW Steel in the dock for getting illegal ore supply
Precious metals witness modest losses
Benign economic reports and steady dollar push prices lower
Precious metals ended lower on Thursday, 28 July, 2011 at Comex. Gold prices witnessed marginal drop while silver dropped substantially. Prices turned pale as the dollar headed higher and economic reports came in better than expected. Concerns about lack of a legislative resolution in the U.S. debt-ceiling standoff kept the drop in price under check.
Gold for December delivery fell $1.1 or 0.1%, to end at $1,616.2 an ounce on the Comex division of the New York Mercantile Exchange on Thursday.
Daily News Roundup - July 29 2011
Karnataka Lokayukta has put JSW Steel in the dock for what it terms "getting illegal supply of iron ore" far in excess of what it was permitted. (BS)
Workers at Maruti Suzuki India’s plant at Manesar in Haryana went on an hour-long ‘tool down’ strike to protest against disciplinary action initiated against four workers. (ET)
The government is likely to resolve the crisis over payment for buying crude oil from Iran by asking Indian companies to open rupee accounts in Union Bank of India. (BS)
Sensex slips for 3rd session…Nifty ends below 5500
The Indian equity markets ended in the negative terrain for a third straight trading session on Thursday amid short rolls seen in the F&O segment. Market sentiment was hit despite food inflation moderating in the middle of July and the Cabinet approving the draft Lokpal Bill.
Investors remained jittery over the near-term prospects amid a slew of negative factors like RBI's hawkish stance on inflation, economic slowdown, drop in FII flows, erratic monsoon, mixed quarterly results and Government inertia in policy making.
Fear of danger!
Let the fear of danger be a spur to prevent it; he that fears not, gives advantage to the danger. - Francis Quarles.
Indian markets are down for three straight days. The F&O expiry has been higher, but short positions are believed to have been carried over amid a spate of headwinds. We expect another muted start today, as world markets are still nervous about the political gridlock in the US over the sensitive issues of debt and deficit.
Thursday, July 28, 2011
Rakesh Jhunjhunwala Portfolio Holdings - July 2011
Click here to View the Latest Rakesh Jhunjhunwala Portfolio Holdings (July 2011)
(accuracy cannot be verified, please do your own due diligence, was passed on by someone)
If you have any corrections, please leave a comment so that everyone else can benefit
NSE Bulk Deals to Watch - July 28 2011
Date,Symbol,Security Name,Client Name,Buy/Sell,Quantity Traded,Trade Price / Wght. Avg. Price,Remarks
28-JUL-2011,ATLASCYCLE,Atlas Cycles (Haryana) Lt,ADROIT FINANCIAL SERVICES PRIVATE LIMITED,BUY,17803,474.26,-
28-JUL-2011,ATLASCYCLE,Atlas Cycles (Haryana) Lt,AJAY,BUY,25401,476.10,-
28-JUL-2011,ATLASCYCLE,Atlas Cycles (Haryana) Lt,AJAY ASSET MANAGEMENT PRIVATE LIMITED,BUY,14565,479.78,-
Easy! Income Tax E-filing Steps
(1) What is E-Filing?
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| (2) Types of E-Filing
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| (3) Types of E-Filing | |||||||
| (4) E – filing process : This is explained below with the help of a flow chart. | |||||||
| (5) Change in the procedure of e- filing for 2008-09
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| (6) e-Filing Process – At a glance
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India - Income Tax Filing Online/e-filing - easy steps
Via TimesOfIndia.com
You have just three more days to file your income-tax returns. If you want to do it without much bother, you should consider e-filing. It's simple if you take care of a few things.
You need to go to the website incometaxindiae-filing.gov.in and download the relevant returns form (ITR 1 to 7) based on your sources of income. For instance, if your only sources of income are salary/pension, interest income and income/loss from one house property, then you can use ITR 1. The website explains who should use which.
Sensex closes F&O expiry day 223 points lower
Rollover pressures alongwith weakness across the globe pulled the markets lower today, ext ending three-day fall
Major headlines
Food inflation at 7.33% versus 7.58%
PNB Q1 net profit slightly up by 3%
HUL Q1 net profit up 18%
Bharatiya Global Infomedia slumps on debut
Settles at Rs 30.95 on BSE
Shares of Bharatiya Global Infomedia settled at Rs 30.95 on BSE, a 62.25% discount to the initial public offer price of Rs 82. The stock debuted at Rs 84, a premium of 2.44% over the initial public offer (IPO) price. The stock hit a high of Rs 84 and low of Rs 27.15. On BSE, 4.07 crore shares were traded on the counter.
Bharatiya Global Infomedia's IPO closed on 14 July 2011. The company had priced the IPO at the top end of the Rs 75-Rs 82 per share price band. Retail investors category was subscribed 5.06 times followed by non-institutional investors category with 1.94 times. However, qualified institutional investors avoided the issue by putting no bids.
L&T Finance Holdings IPO fully bid
Gets bids for 22.51 crore shares
The initial public offer (IPO) of L&T Finance Holdings was subscribed 1.05 times as at 16:00 IST on the second day of the bidding for the issue today, 28 July 2011. The IPO received bids for 22.51 crore shares, compared with 21.45 crore shares on offer.
The price band for the IPO is Rs 51 to Rs 59 per share. The issue closes on Friday, 29 July 2011. The proceeds of the IPO will be used for expansion plans of two of its subsidiaries--L&T Finance and L&T Infrastructure Finance. Rating agencies CARE and ICRA have assigned an IPO grade 5 to the company's IPO indicating that the fundamentals of the company are 'strong' relative to the other listed equities.
Sensex at 5-week low on fears high interest rates will pinch corporate profit growth
Key benchmark indices sank to their lowest closing levels in five weeks on fears that higher interest rates will hurt corporate profit growth. The BSE Sensex was down 222.73 points or 1.21%. The market breadth was weak. Index heavyweight Reliance Industries (RIL) fell nearly 3%, extending recent losses triggered by weak Q1 operating performance.
The Sensex has lost 661.77 points or 3.5% in three trading sessions from a recent high of 18,871.29 on Monday, 25 July 2011, on fears that higher interest rates will hurt corporate profit growth. The Reserve Bank of India (RBI) on Tuesday, 26 July 2011, hiked its key lending rate by a steeper-than expected 50 basis points to tame inflation at a policy review.
Grey Market Premiums - L&T Finance, Inventure Growth
| Company Name | Offer Price (Rs.) | Premium (Rs.) |
| Vaswani Ind. | 49 | 1.50 to 2 |
| Bharatiya Global | 82 | + / - 1.50 to 2 |
| Inventure Growth | 117 | 4 to 4.50 |
| L & T Finance | 51 to 59 | 3 to 3.50 |
| L & T Finance (ASBA) | 51 to 59 | -- |
Market may extend losses; food inflation data eyed
The market may extend losses for the third straight day on weak Asian stocks. The worries that higher interest rates will hurt corporate profit has hurt sentiment. Trading of S&P CNX Nifty on the Singapore stock exchange indicates a fall of 62.50 points at the opening bell.
FIIs sold shares worth a net Rs 12.93 crore on Wednesday, 27 July 2011, as per provisional data from the stock exchanges. Domestic institutional investors (DIIs) sold shares worth Rs 0.19 crore on that day. Fears that higher interest rates will hurt corporate profit growth pulled the market lower for the second straight day on Wednesday, 27 July 2011. The BSE Sensex fell 85.97 points or 0.46% to 18,432.25, its lowest closing level since 12 July 2011.
Markets may begin lower on global pressure
Global weakness may drag Indian markets in the opening trade. Weekly inflation numbers will be declared today.
Headlines for the day:
More rate hikes likely to follow, says FM
Cox & Kings to buy UK travel firm for Rs2,300 crore
Cadila Healthcare buys German firm from ICICI Venture
Daily News Roundup - July 28 2011
Vodafone Essar and Idea Cellular have raised tariffs by around 20% in select circles as well. Vodafone hiked tariffs in three circles-Delhi, Gujarat and Andhra Pradesh, and Idea raised tariffs in two circles of Delhi and Gujarat. (BS)
Infosys dismissed allegations by Jay Palmer, one of its American employees testifying before a US senate subcommittee on alleged misuse of B1 visas by Infosys. (ET)
Glenmark Pharmaceuticals has received US$15mn from US-based Salix Pharmaceuticals for upgrading the manufacturing facility for HIV-associated diarrhea drug Crofelemer. (BS)
Nifty falls for 2nd day…ends below 5550
The Indian equity markets extended the fall for second straight day after RBI’s shocking decision of hiking interest rates by an aggressive 50 bps. Just when we thought that the stock markets would stage a dead cat bounce, there was not respite on Dalal Street. The NSE Nifty lost further 28 points to close at 5546 while the BSE Sensex fell 86 points to end at 18431.
F&O expiry, SEBI meet and the usual
Most people are more comfortable with old problems than with new solutions. - Anonymous.
Multiple pressure points are at work in the markets at the current juncture. The RBI’s shock treatment is on top of the list followed by the political posturing in the US over how to manage the debt crisis. Mind you, the eurozone credit problems are not over yet.
The issue of corruption continues to haunt the markets. RBI governor D. Subbarao (he was finance secretary then) has been named in the 2G scam by former Telecom Secretary. The BJP is all set to dump B.S. Yeddyurappa after the Karnataka Lokayukta submitted its report on illegal mining.
Wednesday, July 27, 2011
Is the telecom tariff party over?
via Business Standard
Well, for Bharti Airtel subscribers, it definitely is over. Last week, the country’s largest mobile operator hiked its mobile tariffs on some plans by 20 per cent across six circles which constitute over 37 per cent of its wireless revenues. This includes pre-paid calls on both their network as well as calls to phones on other ones.
It is not as if the tariff hike has taken the industry completely by surprise. Most telecom watchers say that they were expecting operators confronted with squeezed margins and high debt to pull the rug sometime soon. The signs were already there. First, the relentless fall in tariffs kick-started by new operators last year in order to acquire new subscribers bottomed out. Then, just a few weeks ago, Tata DoCoMo made a tentative move by doubling its own-net tariffs in its GSM service in Tamil Nadu and stealthily followed it up in six more circles (own-net calls of 1 paisa for six seconds were made for three seconds).
Coal India jumps on overseas mine acquisition buzz
Coal India galloped 6.55% at Rs 398.50 on BSE, extending Tuesday's 1.31% gain triggered by reports the state-owned monopoly coal producer is seeking the government's approval to acquire 30% stake in a coal asset in Indonesia.
Meanwhile, the BSE Sensex was provisionally down 93.57 points, or 0.51%, to 18,424.65
On BSE, 24.67 lakh shares were traded in the counter as against an average daily volume of 9.54 lakh shares in the past one quarter.
L&T Finance Holdings IPO subscribed 46% on day one
Gets bids for 9.82 crore shares
The initial public offer (IPO) of L&T Finance Holdings was subscribed 46% on the first day of the issue today, 27 July 2011. The IPO received bids for 9.82 crore shares, compared with 21.45 crore shares on offer.
The price band for the IPO is Rs 51 to Rs 59 per share. The issue closes on Friday, 29 July 2011.
BSE Bulk Deals to Watch - July 27 2011
Deal Date Scrip Code Company Client Name Deal Type * Quantity Price **
27/7/2011 590006 Amrutanjan Health-$ CROSSEAS CAPITAL SERVICES PRIVATE LIMITED B 26867 951.46
27/7/2011 590006 Amrutanjan Health-$ A K G SECURITIES AND CONSULTANCY LTD B 41741 952.05
27/7/2011 590006 Amrutanjan Health-$ R M SHARES TRADING PRIVATE LIMITED B 17976 944.69
NSE Bulk Deals to Watch - July 27 2011
Date,Symbol,Security Name,Client Name,Buy/Sell,Quantity Traded,Trade Price / Wght. Avg. Price,Remarks
27-JUL-2011,AMRUTANJAN,Amrutajan Health Ltd,CROSSEAS CAPITAL SERVICES PVT. LTD.,BUY,27001,951.65,-
27-JUL-2011,AMRUTANJAN,Amrutajan Health Ltd,R.M. SHARE TRADING PVT LTD,BUY,17951,946.64,-
27-JUL-2011,ATLASCYCLE,Atlas Cycles (Haryana) Lt,AJAY ASSET MANAGEMENT PRIVATE LIMITED,BUY,25991,452.32,-
27-JUL-2011,ATLASCYCLE,Atlas Cycles (Haryana) Lt,ASHWIN STOCKS AND INVESTMENT PRIVATE LIMITED,BUY,104844,453.23,-
Markets end lower for 2nd day
Weakness in the global stocks and RBI’s aggressive rate hike weighed on the sentiments today. The Sensex declined 86 points and the Nifty fell 28 points.
Major headlines
IDFC Q1 consolidated net profit declines by 6%
HCL Technologies FY11 consolidated net profit soars 31%
Lupin Q1 consolidated bottomline up 7%
RIL, Bhel extend losses after disappointing Q1 results
Fears that higher interest rates will hurt corporate profit growth pulled the market lower for the second straight day. The barometer index BSE Sensex reached its lowest closing level in more than two weeks. The Sensex shed 85.97 points or 0.46%, up close to 73 points from the day's low and off about 146 points from the day's high. The market breadth, indicating the overall health of the market, was negative. The Reserve Bank of India (RBI) on Tuesday, 26 July 2011, hiked its key lending rate by a steeper-than expected 50 basis points to tame inflation at a policy review, which had triggered a sell-off in stocks on that day.
The market may remain volatile tomorrow, 28 July 2011, as traders roll over positions in the derivatives segment from the near-month July 2011 series to August 2011 series ahead of the expiry of July 2011 derivatives contracts on Thursday, 28 July 2011.
L&T Finance Grey Market Premiums
| Company Name | Offer Price (Rs.) | Premium (Rs.) |
| Vaswani Ind. | 49 | 1.50 to 2 |
| Bharatiya Global | 82 | 1.25 to 1.75 |
| Inventure Growth | 117 | 4 to 4.50 |
| L & T Finance | 51 to 59 | 6 to 6.50 |
Daily News Roundup - July 27 2011
Comptroller and Auditor General of India rejected Reliance Industries’ claim that it was not given enough time to respond to observations relating to its KG-D6 gas field. (ET)
Hindustan Petroleum Corporation is planning to raise US$300mn in the second half of the current fiscal and has appointed Bank of Tokyo-Mitsubishi, State Bank of India and Sumitomo Mitsui Banking as advisors. (ET)
Cairn India has decided to seek shareholders’ nod on the government’s riders for approving the deal. (BS)
Tata Teleservices announced "unification" of two divisions offering services based on CDMA and GSM raising fears of job cuts. (ET)
Recovering from the shock!
To get into the best society nowadays, one has either to feed people, amuse people, or shock people - Oscar Wilde.
It's neither amusing nor interesting. It's a bit shocking. Some call the RBI's move a big leap of faith while many industries are moaning on their fate. Dr. D. Subbarao has upped the ante in the battle against inflation by jacking up rates by an aggressive 50 bps. What’s more, the central bank doesn’t seem to be lowering its guard either. It is ready to sacrifice a little bit of growth in the near term to improve long-term prospects. A further 25-50 bps hike is not ruled out. Let’s hope for some big relief on the inflation front.
Markets head towards a soft opening
The start is expected to be in the negative terrain led by the weak Asian cues. L&T Finance Holdings IPO opens for subscription today.
Headlines for the day:
JSW nears Ispat debt refinance deal
Cognizant to acquire CoreLogic India unit for $50 million
Cairn India to seek shareholders' nod for accepting govt riders
Gold strikes another record high
US debt fears continue to impart shine on bullions
Precious metals had a bright day on Tuesday, 26 July 2011 at Comex. Gold futures rose to a record as U.S. lawmakers remained deadlocked over how to pursue a deal to raise the country's debt ceiling.
Gold for August delivery, the contract with the most volume, added $4.60, or 0.3%, to end at $1,616.80 an ounce on the Comex division of the New York Mercantile Exchange.The December contract, which has the most open interest, added $4.90 to $1,619.30 an ounce.
Crude kisses the $100 mark once again
Prices rise modestly higher riding on low dollar and mixed economic data
Crude prices settled higher on Tuesday, 26 July 2011 at Nymex. Mixed economic data on US home front, low dollar pushed up prices but uncertainty over USA's debt ceiling issue kept gains under check.
On Tuesday, crude oil futures for light sweet crude for August delivery closed higher by $0.89 (0.9%) at $100.09/barrel. Prices fell to a low of $97.82 during intra day trading.
Market may open flat to slightly lower; HCL Tech in focus
The market may open flat to slightly lower tracking weak Asian stocks. Trading of S&P CNX Nifty on the Singapore stock exchange indicates a gain of 4.50 points at the opening bell.
FIIs sold shares worth a net Rs 177.75 crore on Tuesday, 26 July 2011, as per provisional data from the stock exchanges. Domestic institutional investors (DIIs) bought shares worth Rs 31.49 crore on that day. Key benchmark indices tumbled on Tuesday, 26 July 2011 after a higher-than-expected hike of 50 basis points by the Reserve Bank of India (RBI) in its key lending rate at a policy review on Tuesday. The BSE Sensex fell 353.07 points or 1.87% to settle at 18,518.22,
hits lowest closing level since 21 July 2011.
HCL Tech's consolidated net profit rose better than expected 9% to Rs 510 crore on 3.9% rise in total income to Rs 4300 crore in Q4 June 2011 over Q3 March 2011. Consolidated net profit as per US accounting standards was seen rising 7.52% to Rs 503.44 crore on 5% growth in revenue to Rs 4345.08 crore in Q4 June 2011 over Q3 March 2011 as per average estimate of 5 brokerages.
Among prominent results, UltraTech Cement, GAIL (India), Bank of Baroda, Infrastructure Development Finance Company (IDFC), Oil India and Lupin unveil results today, 27 July 2011.
The market may remain volatile in the near term as traders roll over positions in the derivatives segment from the near-month July 2011 series to August 2011 series ahead of the expiry of July 2011 derivatives contracts on Thursday, 28 July 2011.
Reserve Bank of India (RBI) raised key lending rates by 50 basis points at a policy review on Tuesday, 26 July 2011.The RBI has raised its end March 2012 inflation target to 7% as against the previous estimate of 6%, saying inflation has been higher than its expectations. It kept its economic growth forecast of 8% for this fiscal year. The current trends in money supply (M3) and credit growth remain above the indicative trajectory of the Reserve Bank of India, RBI said. Keeping in view the evolving growth-inflation dynamics, the indicative projection of M3 growth for 2011-12 has been revised downwards from 16%, as set out in the May 3 Policy Statement, to 15.5%. Non-food bank credit growth projection has also been revised downwards from 19% to 18%, RBI said.
Notwithstanding some moderation, global commodity prices, especially that of oil, continue to weigh on both domestic growth and inflation, RBI said. The future path of crude oil prices is uncertain. Should the recovery in advanced economies pick up, there may be upward pressure on prices, the RBI said. On the other hand, should the recovery stall, the easy liquidity conditions will continue to prevail leading to continued speculative positions which may prevent prices from softening, RBI said.
RBI said there are risks to the food inflation outlook. First, although the monsoon has been close to normal so far, deficient rainfall in August coupled with higher minimum support prices (MSP) could result in an upward movement in cereals and pulses price inflation. Second, inadequate supply response could keep price inflation of protein-rich items such as egg, meat, fish, milk and pulses high.
The Central Government has budgeted a fiscal deficit of 4.6% of GDP for 2011-12. Subsequent developments have made the achievement of this target much more of a challenge, RBI said. On the expenditure side, the subsidy burden will, in all likelihood, overshoot the budgeted amount in 2011-12 significantly, despite the recent revision in petroleum product prices. On the revenue side, while the tax cuts announced in June 2011, as part of the upward price adjustment of petroleum products, will primarily help in bringing down the magnitude of under-recoveries of oil marketing companies (OMCs), the revenue loss to the Central Government from such tax cuts (about 0.3% of GDP) will impact both the fiscal and revenue deficits.
The large fiscal deficit has been a key source of demand pressures, RBI said. Fiscal consolidation is, therefore, critical to managing inflation. While meeting quantitative targets, the Government also needs to focus on the quality of expenditure to sustain the fiscal consolidation process, which, in turn, will help contain aggregate demand and raise potential output, the RBI said.
Although the impact of past monetary policy actions is still getting transmitted, considering the overall growth and inflation scenario, there is a need to persevere with the anti-inflationary stance, the RBI said. Going forward, the monetary policy stance will depend on the evolving inflation trajectory, which, in turn, will be determined by trends in domestic growth and global commodity prices, the RBI said. A change in stance will be motivated by signs of a sustainable downturn in inflation, it added.
The uncertain global macro-economic environment poses a challenge for the domestic economy from the perspective of financing the current account deficit. In this context, the composition of capital flows remains a concern. In recent months, some shift in composition of capital flows towards foreign direct investment (FDI) has been observed. This trend needs to be reinforced through policy actions to improve the quality of financing of the current account deficit, RBI said.
Reacting to the RBI's monetary policy review, Devendra Kumar Pant, Director, Fitch Ratings said, "RBI's monetary policy was announced in the backdrop of sticky inflation, growth moderation and uncertain global economic conditions. The hike in repo rate by 50 bps is mainly to control inflation, especially non-food manufactured inflation, which is going out of hand. This will certainly have its impact on economic growth, which is likely to be below 8%."
As the crucial corporate earnings season gathers steam, investors will closely watch the post-Q1 June 2011 result management commentary to gauge the future earnings outlook at a time when Indian firms are witnessing cost pressures amid rising interest rates and staff costs. A hike in transportation costs will add to cost pressure of India Inc. As per reports, freight rates have gone up by 8% to 9% on all routes across India following the recent hike in diesel prices.
State-run oil exploration giant ONGC, FMCG giant Hindustan Unilever, Cigarette major ITC, Sun Pharma, cement majors--ACC and Ambuja Cements, Jindal Steel & Power, state-run Punjab National Bank, and GSFC unveil results on 28 July 2011. ICICI Bank, Power Finance Corporation, Bhushan Steel, Idea Cellular and TVS Motor unveil Q1 results on 29 July 2011. Sun TV announces Q1 results on 1 August 2011. Power Grid Corporation unveils Q1 results on 2 August 2011.
Bharti Airtel and United Spirits unveil Q1 results on 3 August 2011. Adani Power, Mundra Port And Special Economic Zone and Indian Hotels announce Q1 results on 4 August 2011. IL&FS Transportation Networks announces Q1 results on 5 August 2011. M&M announces Q1 results on 8 August 2011. ABB, Mahindra Satyam and GMR Infrastructure announce quarterly results on 9 August 2011. Tata Power unveils Q1 results on 10 August 2011. Tata Motors unveils Q1 results on 11 August 2011. Hindalco and Coal India unveil Q1 results on 12 August 2011. Aditya Birla Nuvo unveils Q1 results on 13 August 2011.
Asian shares retreat as the U.S. remains without a deal to prevent default before an Aug. 2 deadline and amid some unexpected economic data from the region. The key benchmark indices in China, Hong Kong, Japan, Singapore and South Korea fell by between 0.01% to 0.56%. The key benchmark indices in Indonesia and Taiwan rose by between 0.19% to 0.37%.
U.S. stocks closed near session lows Tuesday as the extended standoff in Washington over hiking the debt ceiling went unresolved. Republicans and Democrats labored to round up votes for dual debt proposals to avoid a potential default.
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