Tata Motors tumbles as ADR falls after Q4 results

Key benchmark indices dropped in choppy trade as stocks fell across the world stocks amid incessant worries about Spain's finances and the fallout from the European debt crisis. The barometer index, BSE Sensex, lost 126.43 points or 0.77%, up about 20 points from the day's low and off close to 120 points from the day's high. The market breadth was weak. BSE Mid-Cap and Small-Cap indices fell over 1% each. The Sensex has declined 1,006.66 points or 5.81% in May 2012 so far (till 30 May 2012). The barometer index has gained 857.23 points or 5.54% in calendar 2012 so far (till 30 May 2012). From a 52-week low of 15,135.86 on 20 December 2011, the Sensex has risen 1,176.29 points or 7.77%. From a 52-week high of 19,131.70 on 8 July 2011, the Sensex has lost 2,819.55 points or 14.73%. Coming back to today's trade, Tata Motors tumbled nearly 12% as the company's American Depository Receipt (ADR) fell almost 3% on Tuesday, 29 May 2012, after the company reported Q4 March 2012 results. The stock declined on heavy volumes. M&M rose in choppy trade after strong Q4 results. Banks stocks fell across the board. GAIL (India) declined on weak Q4 results. ONGC dropped on concerns about the company's high subsidy burden. Index heavyweight Reliance Industries (RIL) edged higher in volatile trade. Sun Pharmaceutical Industries gained after strong Q4 results. The market edged lower in early trade on weak Asian stocks. A bout of volatility was witnessed as key benchmark indices trimmed losses soon after hitting fresh intraday lows in morning trade. Weakness continued in mid-morning trade. The intraday recovery gathered steam in early afternoon trade. Key benchmark indices weakened again in afternoon trade after European stocks edged lower in early trade there. Volatility ruled the roost as key benchmark indices recovered to hit fresh intraday highs in mid-afternoon trade as political worries eased after DMK chief M Karunanidhi said that he never threatened the Centre of a pull out from the coalition government over petrol price hike. Volatility continued as the market hit fresh intraday low in late trade. The market may remain volatile tomorrow, 31 May 2012, as traders roll over positions from the near-month May 2012 series to June 2012 series. The May 2012 derivatives contracts expire tomorrow, 31 May 2012. The BSE Sensex lost 126.43 points or 0.77% to 16,312.15, its lowest closing level since 25 May 2012. The index declined 143.27 points at the day's low of 16,295.31 in late trade. The index fell 9.84 points at the day's high of 16,428.74 in mid-afternoon trade. The S&P CNX Nifty lost 39.35 points or 0.79% to 4,950.75, its lowest closing level since 25 May 2012. The index hit low of 4,944.90 and a high of 4,982.25 in intraday trade. The BSE Mid-Cap index fell 1.28% and the BSE Small-Cap index dropped 1.21%. Both these indices underperformed the Sensex. BSE clocked turnover of Rs 1719 crore, lower than Rs 1749.05 crore on Tuesday, 29 May 2012. The market breadth, indicating the overall health of the market, was weak. On BSE, 1,654 shares declined and 1,046 shares rose. A total of 128 shares were unchanged. Among the 30-share Sensex pack, 20 fell while the rest rose. Index heavyweight Reliance Industries (RIL) rose 0.63% to Rs 706.20. The stock came off the day's low of Rs 695.95. RIL on Tuesday, 29 May 2012, said the company bought back 8.2 lakh shares at average price of Rs 700.226 per share on Monday, 28 May 2012. The company cumulatively bought back a total of 2.09 crore till 28 May 2012 under the share buyback programme. RIL early last week said it has selected Phillips 66's E-Gas technology for its planned gasification plants at Jamnagar in Gujarat. The planned gasification plants at Jamnagar will be among the largest in the world and will process petroleum coke and coal into synthesis gas utilizing the E-Gas technology, RIL said in a statement. The synthesis gas will be used as a feedstock for a new chemical complex and will fuel the Jamnagar refinery's existing gas turbine power generation units, RIL said in a statement. GAIL (India) fell 1.76% after the company announced during market hours today its net profit declined 38.27% to Rs 483.34 crore on 19.6% growth in total income to Rs 10718.28 crore in Q4 March 2012 over Q4 March 2011. ONGC shed 1.44%, with the stock reversing intraday gains, on concerns about the company's high subsidy burden. The company announced after market hours on Tuesday its net profit surged 102% to Rs 5644 crore on 22% growth in sales income to Rs 18976 crore in Q4 March 2012 over Q4 March 2011. The company has notified two new discoveries -- one gas discovery and one oil discovery. ONGC's gross subsidy rose 16.7% to Rs 14170 crore in Q4 March 2012 over Q4 March 2011. The company's gross subsidy jumped 78.6% to Rs 44466 crore in the year ended March 2012 over the year ended March 2011. Three state-run upstream oil firms -- Oil India, ONGC and GAIL (India) -- share part of the under-recoveries of state-run oil refining-cum-market firms arising from the government-imposed price caps on three key fuels -- diesel, LPG for domestic use and kerosene sold through the public distribution system. Sun Pharmaceutical Industries rose 2.76% after company announced after market hours on Tuesday its consolidated net profit jumped 85% to Rs 820 crore on 59% growth in net sales/income from operations at Rs 2330 crore in Q4 March 2012 over Q4 March 2011. The company expects consolidated sales for the current financial year to grow 18%-20% over last year, its managing director said Wednesday. Dilip Shanghvi also said that the company has a capital expenditure outlay of Rs 500 crore for this fiscal year, which could be used to expand existing facilities as well as for setting up new ones. Research and development expenses for the year are estimated to be between 6% and 8% of net sales, he said on a conference call with analysts. Shanghvi added that the company plans to file 25 generic-drug applications with the US regulator this year. Tata Motors tumbled 11.80% as the company's American Depository Receipt (ADR) fell almost 3% on Tuesday, 29 May 2012, after the company reported Q4 March 2012 results. The stock declined on high volumes. On BSE, 71.95 lakh shares changed hands in the counter, compared with average daily volume of 13.50 lakh shares in the past one quarter. Tata Motors' consolidated net profit jumped 136.35% to Rs 6234 crore on 44.3% growth in revenue (net of excise) to Rs 50908 crore in Q4 March 2012 over Q4 March 2011. The company announced the results after trading hours on Tuesday, 29 May 2011. Tata Motors' sales (including exports) of commercial and passenger vehicles for FY 2011-12, stood at 926,353 units, representing a growth of 10.7% as compared to the corresponding period last year. In the domestic market, the company's commercial vehicles sales for the quarter ended March 31, 2012, stood at 1,55,672 units, an increase of 16.2% over the corresponding period last year. The commercial vehicles sales during FY 2011-12 increased by 15.7% to 530,204 units, as compared to the corresponding period last year. The company's market share in commercial vehicles was 59.4% for FY 2011-12. Passenger vehicles, including Fiat and Jaguar and Land Rover vehicles distributed in India, grew by 18.1% to 1,12,470 units in the domestic market for the quarter ended March 31, 2012, as compared to the corresponding period last year. Sales for FY 2011-12 grew by 4% to 3,33,044 units, as compared to the corresponding period last year. Focused marketing initiatives and network actions have positively influenced sales. The market share in passenger vehicles stood at 13.1% for FY 2011-12 largely driven by sales in the recent quarters. The market share in passenger vehicles for Q4 FY 2012 stood at 14.2%. Small-car maker Maruti Suzuki India rose 2.12%, with the stock extending Tuesday's 2.11% gains triggered by bargain hunting after recent losses triggered by worries the latest steep hike in petrol prices may hit car sales. Shares of two-wheeler makers edged lower. India's largest motorcycle maker by sales Hero MotoCorp dropped 0.36%. India's second largest motorcycle maker by sales Bajaj Auto declined 0.56%. Mahindra & Mahindra (M&M) rose 0.14% to Rs 657.20 after strong Q4 results. The scrip was volatile. The stock hit a low of Rs 649.10 and high of Rs 662.80. M&M's net profit jumped 44.2% to Rs 874.50 crore on 38.9% growth in gross revenue and other income to Rs 10288.40 crore in Q4 March 2012 over Q4 March 2011. With global risks escalating and continued weakness in the domestic macro environment, the near term outlook for the economy is quite challenging, M&M said. However, the company through its continuous focus on new product introduction, process innovation and cost control, expects to meet this challenge, M&M said in a statement. M&M said Mr. Keshub Mahindra, Chairman of Mahindra & Mahindra, advised the board of his intention to retire from the board at the conclusion of the forthcoming Annual General Body Meeting scheduled on August 8, 2012. M&M said the board reluctantly acceded to the Chairman's desire but requested him to accept the position of Chairman Emeritus, emphasizing that the company required his advice and counsel. The board unanimously appointed Mr. Anand Mahindra as Chairman & Managing Director with effect from the conclusion of the forthcoming Annual General Body Meeting scheduled on August 8, 2012. PSU bank stocks fell across the board after the government on Tuesday, 29 May 2012, directed state-run banks to restructure Rs 35000 crore worth of debt on the books of textile companies and also asked the central bank in consultation with the finance ministry to consider a two-year moratorium on term loans and other measures to help cash-strapped companies in the ailing textile sector improve their working capital positions. Bank of India, Bank of Baroda and Punjab National Bank shed 0.8% to 3.52%. India's largest commercial bank in terms of branch network State Bank of India (SBI) dropped 1.08% on profit taking after recent strong gains triggered by healthy Q4 results. The state-run bank reported 19297.84% spurt in net profit to Rs 4050.27 crore on 27.97% growth in total income to Rs 33959.54 crore in the Q4 March 2012 over Q4 March 2011. The result was announced on 18 May 2012. The massive rise in SBI's net profit in the fourth quarter was due to base effect. It may be recalled that SBI had made massive one-time provisions in Q4 March 2011 on account of counter cyclical provisioning buffer, provisions for the teaser home loans and provision for deferred tax. This has resulted in low base effect for year-on-year comparison in Q4 March 2012. SBI's net profit jumped 41.65% to Rs 11707.29 crore on 24.33% growth in total income to Rs 120872.90 crore in the year March 2012 over year March 2011. SBI said it made an additional provision of Rs 1350 crore against certain non-performing domestic advances in the year ended March 2012. The bank's provision converge ratio stood at 68.10% as on 31 March 2012, higher than 64.95% as on 31 March 2011. SBI's board proposed a dividend of Rs 35 per share for the year ended 31 March 2012. SBI's consolidated net profit jumped 43.59% to Rs 15343.10 crore on 19.74% growth in total income to Rs 177032.80 crore in the year ended 31 March 2012 over the year ended 31 March 2011. India's largest private sector bank by net profit ICICI Bank declined 2.62%. India's second largest private sector bank by net profit HDFC Bank shed 0.78%. Telecom stocks were mixed after reports state-run MTNL has cut the tariff for Internet usage on its third-generation network by about 70%, signaling a new wave of price war in the sector. MTNL, Idea Cellular and Bharti Airtel rose by between 0.62% to 1.78%. Tata Teleservices (Maharashtra) and Reliance Communications fell 2.44% to 3.11%. The price cut by MTNL comes after market leader Bharti Airtel, Reliance Communications and Idea Cellular slashed their rates by 62%-70% over the past few weeks to entice more people to use 3G services, which allow fast data transfer. Shree Renuka Sugars fell 4.22% after the company reported a consolidated net loss of Rs 71.90 crore for the quarter ended March 2012 compared with a net profit of Rs 59.40 crore in the quarter ended March 2011. Among other sugar stocks, Balrampur Chini Mills and Bajaj Hindusthan shed by between 2.83% to 3.54%. Metal stocks declined as optimism about Chinese stimulus measures to power the economy took a hit after a state media report suggested the package will be relatively mild compared to actions taken at the height of the global financial crisis four years ago. China is the world's largest consumer of copper and aluminum. Bhushan Steel, Sterlite Industries, JSW Steel, Tata Steel, Hindalco Industries, Hindustan Zinc and Jindal Steel & Power fell by between 0.1% to 2.06%. Steel Authority of India (Sail) declined 1.02%, with the stock extending Tuesday's losses triggered by the company reporting muted growth in net profit in Q4 March 2012. The company announced during market hours on Tuesday that its net profit rose 3.02% to Rs 1576.98 crore on 12.71% growth in income from operations to Rs 13691.97 crore in Q4 March 2012 over Q4 March 2011. Sail early this week signed a 50:50 joint venture agreement with Burn Standard Company (BSCL) at Kolkata for setting up a wagon components manufacturing facility at the premises of BSCL at Jellingham, Purba Medinipore district, in West Bengal, with a capacity to produce 10,000 bogies and 10,000 couplers per annum. The estimated capital outlay for the project is about Rs 200 crore. Hindustan Copper rose 1.25% after company announced after market hours on Tuesday its net profit surged 125.4% to Rs 137.43 crore on 96.2% growth in net sales to Rs 585.61 crore in Q4 March 2012 over Q4 March 2011. Capital goods stocks edged lower. Siemens, Bhel, Thermax, L&T, BEML and ABB fell by between 0.72% to 3.05%. United Spirits tumbled 6.07% after consolidated net profit fell 67% to Rs 187.93 crore on 24.54% growth in net sales to Rs 9186.50 crore in the year ended 31 March 2012 over the year ended 31 March 2011. Marico fell 1.29%. The company through its wholly owned subsidiary, Marico Consumer Care, has completed the acquisition of 100% equity stake in Halite Personal Care India, a company into which the assets of the personal care business of Paras Pharmaceuticals were vested through a demerger process. Colgate Palmolive (India) fell 2.73% on profit taking after good Q4 results. The company's net profit rose 15% to Rs 130.80 crore on 18% growth in net sales Rs 685.90 crore in Q4 March 2012 over Q4 March 2011. The Colgate Palmolive (India) stock had witnessed a pre-result rally. The had surged 8.35% to settle at Rs 1,216.15 on Tuesday, 29 May 2012, from a recent low of Rs 1,122.40 on 7 May 2012. Realty major, DLF fell 2.53% ahead of its Q4 results today, 30 May 2012. IT stocks were mostly higher on a weak rupee. A weak rupee boosts revenue of IT firms in rupee terms as the sector derives a lion's share of revenue from exports. The rupee fell below the 56 mark against dollar on Wednesday, adding to losses in the previous session triggered by euro-zone debt worries. India's second largest software services exporter by revenue, Infosys gained 0.64%. India's third largest software services exporter by revenue, Wipro rose 0.61%. Among other IT shares, HCL Tech, Tech Mahindra and Mahindra Satyam rose 0.64% to 3.8%. India's largest software services exporter by revenues Tata Consultancy Services (TCS) was flat. N. Ganapathy Subramaniam, head of TCS's financial services business, said in a recent media interview that TCS is confident that growth in its financial services segment this fiscal year will be around last year's 21%. Mr. Subramaniam added that the pipeline of deals is as strong as what it was a year ago, when global businesses accelerated investments on the expectation of an economic recovery. Airline stocks dropped across the board. Jet Airways (down 1.91%), and SpiceJet (down 5.3%), declined. Kingfisher Airlines tumbled 7.92% to Rs 11.05. The stock hit a record low of Rs 10.90 today. PSU OMCs extended their recent losses triggered by a statement from Oil Minister Jaipal Reddy on Monday, 28 May 2012, that the government is not considering any immediate increases in diesel and cooking fuel prices. BPCL fell 1.3% and Indian Oil Corporation shed 2.61%. The three state-run oil refining-cum-marketing companies -- Indian Oil Corporation, BPCL and HPCL -- sell diesel and cooking fuels at government-set, discounted prices. Because of this, they are losing Rs 509 crore a day on the sale of these products. PSU OMCs, last week, raised petrol prices by a steep 11.5%, leading to protests. Opposition parties have called a Bharat Bandh on Thursday, 31 May 2012, to protest against the steep hike in petrol prices. HPCL fell 1.85%. The company announced after market hours on Tuesday that net profit surged 312.5% to Rs 4630.99 crore on 31.7% growth in total income to Rs 52772.56 crore in Q4 March 2012 over Q4 March 2011. Cash subsidy payment from the government helped the state-run company to offset losses on selling fuel products at below-market rates. The government has not fixed a date yet for a meeting of Empowered Group of Ministers (EGoM) to discuss raising the prices of diesel, kerosene and cooking gas, which are sold at state-set cheaper rates, finance secretary R.S. Gujral told reporters on Wednesday. Tata Motors clocked highest volume of 71.95 lakh shares on BSE. Lanco Infratech (55.77 lakh shares), Suzlon Energy (51.99 lakh shares), Kingfisher Airlines (46.23 lakh shares) and HDIL (44.08 lakh shares) were the other volume toppers in that order. Tata Motors clocked highest turnover of Rs 175.10 crore on BSE. SBI (Rs 128.15 crore), Wockhardt (Rs 51 crore), Wheels India (Rs 37.71 crore) and Ajanta Pharma (Rs 33.79 crore) were the other turnover toppers in that order. The arrival of crucial monsoon rains over India's mainland through the southern state of Kerala may reportedly be delayed by three to four days beyond the forecast date of June 1. Normally, the monsoon arrives over the country in the first week of June. A timely arrival of monsoon rains is critical for the sowing of summer crops such as rice, oilseeds, sugar cane and cotton. Around 60% of summer crops are rain-fed, and if monsoon rainfall is more or less on schedule and in sufficient amounts, crops that benefit from the rains account for around half of India's total agricultural output. The Q4 March 2012 gross domestic product (GDP) data due at 11:00 IST tomorrow, 31 May 2012, could provide cues on the Reserve Bank of India's likely policy stance at its mid-quarter policy review due on 18 June 2012. GDP growth is projected at 6.2% in Q4 March 2012, as per the median estimates of a poll of economists carried out by Capital Market. The Indian economy expanded 6.1% in the October-December quarter from a year earlier, the weakest pace of expansion in more than two years, hurt by slower growth in manufacturing output and a contraction in mining production. The economy is seen expanding 6.7% in FY 2012 (year ended March 2012) and 6.9% in FY 2013 (year ending March 2013) as per the median estimate of the poll carried out by Capital Market. DMK chief M Karunanidhi on Wednesday said that he never threatened the Centre of a pull out from the coalition over the petrol price hike. The DMK is a key member of the Congress-led United Progress Alliance (UPA) coalition government at the centre. Karunanidhi, who demanded a substantial reduction in the Rs 7.50 per litre petrol price hike, said both Centre and state should vie to win people's goodwill by reducing the burden on them. State-run oil refining-cum-marketing firms raised petrol prices by a steep 11.5% last week, leading to protests. Opposition parties have called a Bharat Bandh tomorrow, 31 May 2012, to protest against the steep hike in petrol prices. Earlier, another UPA ally Trinamool Congress (TMC) had also attacked the Centre over the petrol price hike. West Bengal Chief Minister Mamata Banerjee on 26 May 2012 led a protest rally of several thousand Trinamool supporters in Kolkata, demanding a roll back. European shares slipped on Wednesday amid incessant worries about Spain's finances and the fallout from the European debt crisis. Key benchmark indices in UK, France and Germany were down by 0.59% to 1.86%. The yield on the 10-year Spanish government bond surged 22 basis points to 6.686% on Wednesday after independent credit-rating firm Egan-Jones Ratings Co. on Tuesday downgraded Spain to B from BB- with a negative watch. Spain will inevitably be faced with payments to support a portion of its banking sector and for its weaker provinces, Egan-Jones said. Assets of Spain's largest two banks exceed its GDP, it added. Separately, Bank of Spain Governor Miguel Angel Fernández Ordóñez will step down a month ahead of schedule, giving his successor a head start on trying to tame the country's unraveling fiscal situation, the Bank of Spain said in a statement Tuesday. The Bank of Spain has come under criticism for its handling of Bankia, with reports surfacing Tuesday that one of the lender's former executives would get a 14 million euro ($18 million) pension payout. Spanish bank Bankia was nationalized on 9 May 2012. Greek voters return to the polls on 17 June 2012 after the splintered results of a May 6 parliamentary election left no party able to put together a government. Opinion polls showed on 26 May 2012 that the pro-bailout New Democracy party ahead of rivals in upcoming polls in Greece. The reports eased fears that Greece's exit from the euro-zone was imminent. If Greece left the euro, living standards would plummet, incomes would be slashed by more than half, and inflation and unemployment would skyrocket, the National Bank of Greece, the country's biggest bank, warned on Tuesday. Asian stock markets fell on Wednesday, 30 May 2012, paring strong gains from the previous session as hopes for strong stimulus spending in China faltered, and as more trouble in Spain posed fresh threats to the euro zone. Key benchmark indices in China, Indonesia, Singapore, Hong Kong, Japan, Taiwan and South Korea were down by 0.21% to 1.92%. Optimism about Chinese stimulus measures to power the economy took a hit after a state media report suggested the package will be relatively mild compared to actions taken at the height of the global financial crisis four years ago. China is the world's second biggest economy after the US. Trading in US index futures indicated that the Dow could fall 117 points at the opening bell on Wednesday, 30 May 2012.