Friday, August 12, 2011
Settles at Rs 49.95 on BSE
Shares of L&T Finance Holdings settled at Rs 49.95 on BSE, a discount of 3.94% to the initial public offer price of Rs 52. The stock debuted at Rs 51, a discount of 1.92% to the initial public offer (IPO) price. The stock high of Rs 52.50 and low of Rs 49.50. Volumes were huge as 4.43 crore shares changed hands on BSE.
L&T Finance Holdings, a subsidiary of engineering and construction major Larsen and Toubro, had priced its IPO at Rs 52 a share, near the lower end of the Rs 51 to Rs 59 per share price band.
The IPO was subscribed 5.34 times. Retail individual investors category was subscribed 9.61 times, followed by non-institutional investors category (6.18 times), and qualified institutional buyers (QIB) category (1.93 times).
Foreign institutional investors (FIIs) put in bids for 4.96 crore shares, compared with 7.53 crore shares reserved for the QIB category as a whole. Domestic financial institutions, excluding mutual funds, put in bids for 8.52 crore shares. Mutual funds put in bids for 82.09 lakh shares.
The proceeds of the IPO will be used for expansion plans of two of its subsidiaries--L&T Finance and L&T Infrastructure Finance.
On 26 July 2011, L&T Finance Holdings raised Rs 153.04 crore by selling 2.73 crore shares at Rs 56 each to anchor investors. On 7 July 2011, the firm had garnered Rs 330 crore through a private placement of 6 crore equity shares at Rs 55 per share to the private equity fund of Capital International of the US.
L&T Finance Holdings is the financial holding company offering a diverse range of financial products and services through its four operating subsidiaries. These are L&T Finance that focuses on asset financing in the corporate, retail and rural segments; L&T Infrastructure Finance Company that focuses on infrastructure financing; India Infrastructure Developers that proposes to focus on working capital financing for corporate borrowers and L&T Investment Management that operates a Securities & Exchange Board of India (Sebi) registered Mutual Fund business.
Mumbai-based L&T Finance Holdings has a presence in 23 states in India. As at 31 May 2011, it had 837 points-of-presence across India through its subsidiaries.
On a consolidated basis, L&T Finance Holdings' net profit rose 49% to Rs 392.57 crore on 48% increase in total income to Rs 2086.38 crore in the year ended March 2011 over the year ended March 2010.
L&T Finance Holdings is a subsidiary of L&T, India's biggest engineering & construction firm in terms of order book.
Growing fears of another recession in the US, the world's biggest economy, dragged the market lower last week. An unprecedented downgrade of the US credit rating by Standard & Poor's on Friday, 5 August 2011, led investors to reduce exposure to risky assets. The US Federal Reserve decided on Tuesday, 9 August 2011, to keep US interest rates ultra-low for two more years to avoid recession in the world's biggest economy.
With Q1 June 2011 results over, Indian shares will take cues from global markets. A recent correction in commodity prices, including that of oil and metals augurs well for Indian manufacturing firms and also the government in reining in oil subsidy burden. Lower commodity prices may also help rein in high inflation.
Next week is a truncated trading week. The stock market remains closed on Monday, 15 August 2011, on account of Independence Day. Shares of State Bank of India, Aditya Birla Nuvo, Reliance Communications, Reliance Capital and Shipping Corporation of India will on Tuesday, 16 August 2011, react to their Q1 results which will be announced on Saturday, 13 August 2011.
Deal Date Scrip Code Company Client Name Deal Type * Quantity Price **
12/8/2011 524606 Beryl Drugs DINESH NANDWANA (HUF) S 56679 34.72
12/8/2011 524606 Beryl Drugs SONIYA SETHI S 36145 34.68
12/8/2011 524606 Beryl Drugs SANGEETA SETHI S 30032 34.74
12/8/2011 511664 BGIL Films ENAAM SECURITIES B 64449 4.55
12/8/2011 511664 BGIL Films KAILASH CHANDRA S 66150 4.55
12/8/2011 506027 Bhoruka Alum SUNRISE INVESTMENT B 170988 21.17
Date,Symbol,Security Name,Client Name,Buy/Sell,Quantity Traded,Trade Price / Wght. Avg. Price,Remarks
12-AUG-2011,AANJANEYA,Aanjaneya Lifecare Ltd,AMBER ENCLAVE PRIVATE LIMITED,BUY,75000,476.23,-
12-AUG-2011,AANJANEYA,Aanjaneya Lifecare Ltd,BMD EXPORTS PRIVATE LIMITED,BUY,2528,455.00,-
12-AUG-2011,APTECHT,Aptech Limited,VIRGINIA RETIREMENT SYSTEM,BUY,259063,134.52,-
12-AUG-2011,CREWBOS,Crew B.O.S. Products Limi,BP FINTRADE PRIVATE LIMITED,BUY,72274,56.22,-
12-AUG-2011,EXCELINFO,Excel Infoways Limited,JHAVERI TRADING AND INVESTMENT PVT LTD,BUY,200000,15.05,-
Mounting fears over the health of global economy hampered investor sentiment this week. The Sensex falls 2.69% and the Nifty slips 2.65%.
Major headlines for the week
June IIP at 8.8% versus 5.6%
Food inflation at 9.9% versus 8.04%
Tata Motors Q1 consolidated net profit at Rs2,000 crore
L&T Q1 net profit up 12%
M&M net profit rises 8% in Q1
Fears that higher interest rates will crimp corporate profit growth pulled the market lower for the second day in a row, with the barometer index BSE Sensex settling at 14-month closing low below the psychological 17,000 level. The market breadth, indicating the overall health of the market, was negative. The Sensex shed 219.77 points or 1.29%, off close to 410 points from the day's high and up close to 55 points from the day's low. Index heavyweight Reliance Industries (RIL) fell in choppy trade.
Investors investing in India have been worried that higher interest rates will crimp corporate profit growth. Two leading banks, State Bank of India (SBI) and ICICI Bank, on Thursday, 11 August 2011, raised lending rates. The Reserve Bank of India (RBI) late last month raised its key lending rate by a steeper-than-expected 50 basis points to rein in high inflation. The RBI has raised interest rates 11 times since March 2010 to control inflation, which still reigns close to double-digit levels because of high food prices and intensifying demand pressures in non-food commodities.
1.50 to 2
L & T Finance
2 to 3
3 to 3.25
Tree House of Education & Accessories
135 to 153
3 to 4
Shriram City Union Bond
12 to 13
Good US jobs data lifted the sentiments across the globe, which may lead Indian markets higher in the opening trade.
Headlines for the day:
Mahindra to spread its wings in aviation space
SBI scales down rights issue proposal
Tata Motors, Leyland to step on the gas for auto LNG
Major corporate action
L&T Finance Holdings to list today
IIP data for June 2011
Results: BF Utilities, BPCL, Coal India, HDIL, Tata Steel, Tech Mahindra
Adani Enterprise will pick up 20% equity in Green Gas Limited, a joint venture between Gail and the Indian Oil Corporation. (FE)
SAIL is on the verge of securing major coal and iron ore mines allocation in Indonesia as part of its overseas expansion plans. (BS)
Reliance Communications is in advanced talks to ink a near USD1.5-bn,multi-vendor managed services outsourcing deal with a clutch of telecom gearmakers such as Chinas ZTE,Huawei and Swedens Ericsson (ET)
"Few cross the river of time and are able to reach non-being. Most of them run up and down only on this side of the river." - Horace.
Consider yourself lucky even if you have been on the sidelines of late. Few can stomach the gyrations like we had this week, with stocks swinging wildly. So, after Wednesday’s steep fall markets in the US and Europe rallied on Thursday. Positive news on weekly jobless claims and Cisco’s results helped lift sagging spirits on Wall Street. Recovery in banks aided the advance in Europe. Meanwhile, France, Italy, Spain and Belgium have banned short-selling.
The market may gain on firm Asian stocks. Trading of S&P CNX Nifty on the Singapore stock exchange indicates a gain of 47 points at the opening bell.
Foreign institutional investors (FIIs) sold shares worth a net Rs 59.79 crore on Thursday, 11 August 2011, as per provisional data from the stock exchanges. Domestic institutional investors (DIIs) bought shares worth Rs 266.25 crore on that day. Key benchmark indices edged lower in choppy trade on Thursday, 11 August 2011 as an increase in food inflation raised concerns the central bank will stick to its tight monetary policy. The BSE Sensex was down 71.11 points or 0.42% to 17,059.40, its lowest closing level since Tuesday, 9 August 2011.