Cox & Kings (India) IPO Analysis

Cox & Kings is one of the recognized holiday brands with over 250 years of history. Over the years, it has increased its reach with global presence in 19 countries besides India through subsidiaries, branch offices and representative offices. In India, the company has 255 points of presence covering 164 locations through a mix of branch sales offices, franchised sales shops, general sales agents and preferred sales agents.

Cox & Kings has been promoted by A B M Good and Ajay Ajit Peter Kerker and his associates. Ajit Kerker was a very well known name in the Indian hotel industry and was earlier associated with Indian Hotels group, from where he had a controversial exit some years back.

The business of Cox & Kings can be broadly categorized as leisure travel (which includes outbound travel, inbound travel and domestic travel); corporate travel; and visa processing. The company has products like "Duniya Dekho", "Bharat Dekho" and "FlexiHol". It has increased its geographical presence through acquisitions as well as expanding its own business.

Acquisitions

In March 2006, Cox & Kings acquired the entire shareholding of Clearmine, a company incorporated in the UK. ETN Servicesis a wholly owned subsidiary of Clearmine and carries out destination management services for tours to Europe and also inbound tours in Europe for other tour operators. In September 2007, the company acquired the entire shareholding of Cox & Kings based in the UK and took over 41.17% of the share capital of Cox & Kings (Japan). Cox & Kings Travel, a wholly owned subsidiary of Cox & Kings, is an outbound specialist tour operator and caters to leisure travel market of Europe. Cox & Kings Travel and Cox & Kings Tours LLC holds 33.33% and 25.50%, respectively, of Cox & Kings (Japan). Cox & Kings (Japan) is a dedicated wholesaler of products and services to other tour operators.

The company acquired Quoprro Global Services Pvt. Ltd. and forayed into the business of visa processing. In September 2008, it got approval from the High Commission of India at Singapore for outsourcing their visa processing activities. Recently, it got in-principle approvals from the diplomatic missions of India at Athens, Greece and at Hong Kong for outsourcing their visa processing activities.

In December 2008 the company formed a joint venture with IRCTC, "Royale Indian Rail Tours Limited", to operate a luxury train to be called "Maharajas' Express". This train is currently under manufacturing and is scheduled to commence operations in January 2010. The train will carry nearly 100 passengers in 23 passenger coaches and will have two bars and two restaurants. It will have an ultra modern kitchen and a boutique. The train is expected to operate from September to April, making it a total of 16 journeys per annum.

During FY 2010, the company acquired Tempo Holidays Pty Ltd, based in Australia, with its wholly owned subsidiary Tempo Holidays NZ Ltd. in New Zealand. This would further consolidate its position in Europe as major business of the acquired company is in European countries. It has entered US with its recent acquisition of East India Travel Company Inc., which is in the business of selling up-market tour and travel packages in the US.

Domestic & International mix

The share of domestic revenues to the total operating revenues of the company has come down from 92% in FY2007 to 60% for Q1FY2010. The main reason is acquisition in the overseas markets.

The India business, i.e., the standalone business has reported CAGR over the last 4 years of 38.6% in revenues and 37.6% in profitability.

Public Issue

The public offer includes fresh issue and offer for sale by selling shareholders. The selling shareholders mainly Lehman Brothers Opportunity Limited, Deutsche Securities Mauritius and Merrill Lynch Capital Markets Espana S.A., S.V. are selling off part of their stake bringing it down from 8.23% to 3.39% on post issue equity. The selling shareholders had acquired the stake through purchase from promoters of the company in 2006 and increased its stake through bonus issue in 2007 and through rights issue at Rs 10 in July 2009. The cost for the selling shareholders is about Rs 91.91 per share.

The net proceeds of fresh issue would be utilized towards repayment of debt, acquisitions and strategic initiatives, investment in subsidiaries, in facilities and finally for corporate purposes. Part of the IPO proceeds is towards repayment of debt and for corporate purposes, which includes working capital needs of the Company. This would lead to lower interest costs and lower working capital needs going forward.

Strengths

* Cox & Kings has a good blend of domestic and international business so as to diversify its risk of dependence on one specific country. With presence across 19 countries other than India, e.g. UK, US, Australia, New Zealand and Japan, it has diversified its business. The share of international revenues has increased to 40% for the quarter ended June 30, 2009.

* The company has seen good growth in the domestic business. The revenue for the domestic business has reported CAGR of 38% for the last 4 years with earnings CAGR of 38%. Even in the downturn of 2008-2009, the company was able to grow revenues by 31% and maintain operating margins at 44% in the domestic business.

* The travel & tourism industry has seen a downturn due to the global economic slowdown. However, going forward, World Travel & Tourism Organization predicts the overall travel & tourism economy to grow by 4% per annum in real terms over the next 10 years. For India, the expected growth in travel & tourism demand from 2010 – 2019 would be 8.2%.

Weaknesses

* The company operates in a highly competitive market. It faces stiff competition from other organized players operating in this sector and also from the un-organized sectors. Many Indian and foreign players have entered the market both in the online and offline space.

* The travel and tours industry is cyclical and sensitive to changes in the economy in general. The sector may be affected by such factors as changes in the global and domestic economies. Any occurrence of an epidemic/terrorist acts in the countries may also have an adverse effect on the operations.

Outlook

At the issue price of Rs 316 – 330, on the consolidated EPS of Rs 10 for FY2009, the PE works out to 31.6 – 33 times. Thomas Cook (India) is trading at TTM PE of 47.5 times. However, Cox & Kings is much bigger in terms of global presence, with the listed Thomas Cook (India) being mainly India centric, whereas Cox & Kings is a global player.

Market recovers after a weak start; RIL declines

The key benchmark indices recovered and were trading flat after a negative start. The gains in some Asian stocks helped recovery. The BSE 30-share Sensex was flat at 17051.90 up close to 60 points from the day's low. The Sensex regained 17000 mark after falling that level in early trade. Banking stocks fell but IT stocks rose. Oil exploration stocks rose but PSU OMCs fell on gains in crude oil prices. Index heavyweight Reliance Industries fell despite setting record date for the bonus issue. Another index heavyweight Larsen & Toubro also fell.

Federal Reserve Chairman Ben Bernanke surprised investors on Monday 16 November 2009 when he said the central bank was attentive to implications of changes in the value of the dollar, although he reiterated that interest rates would remain exceptionally low for an extended period.

Closer home, inflation based on the wholesale price index accelerated in October 2009 from a month earlier on costlier minerals and fuels. On Saturday 14 November 2009, the government switched to using monthly inflation data for all commodities with 1993/94 as the base year, from the earlier practice of announcing weekly price movement. The wholesale price index was up 1.34% in October 2009 from a year earlier, compared with 0.5% rise in September 2009 and 11.06% jump a year ago. Food prices, however, declined by 1% from the previous month's level, while minerals and industrial fuels were each costlier by 3%.

Industrial output grew 9.1% in September 2009 from a year earlier, helped by stimulus and festival demand, and adding to the debate on the timing of exit policy. However, Finance minister Pranab Mukherjee said on Monday stimulus packages to perk up the economy during the slowdown are unlikely to be withdrawn in the current financial year and the exit when it happens will be a gradual one.

Economists and analysts surveyed by the Reserve Bank of India (RBI) revised downwards India's gross domestic product projection to 6% for 2009/10 from 6.5% in the previous round of survey, the RBI released the results of the ninth round of survey on Monday 16 November 2009.

The RBI in its mid-term monetary policy review last month kept its GDP projection for the current fiscal unchanged at 6% but had increased inflation target to 6.5% by end-March 2010 from 5%. The government is scheduled to announce the July-September GDP growth number on 30 November 2009.

Asian stocks were trading mixed on Wednesday as the generally bearish dollar kept riskier assets in demand. The key benchmark indices in China, South Korea and Taiwan rose by between 0.265% to 0.72%. The key benchmark indices in Hong Kong, Japan and Singapore fell by between 0.49% to 0.88%.

Trading in US index futures indicated Dow could fall 12 points at the opening bell on Wednesday, 18 November 2009.

US stocks rose to fresh 13-month highs on Tuesday as upbeat broker views on improving prospects for two Dow components offset disappointing holiday spending outlooks from Target and Home Depot. The Dow Jones industrial average was up 30.46 points, or 0.29%, to end at 10,437.42. The Standard & Poor's 500 Index gained 1.02 points, or 0.09% to finish at 1,110.32. The Nasdaq Composite Index rose 5.93 points, or 0.27% to close at 2,203.78.

In economic data from the US, producer prices rose 0.3% in October, with the core rate dropping 0.6%. And industrial production climbed 0.1% in October 2009. This was less than the 0.4% gain expected.

At 10:20 IST, the BSE 30-share Sensex was flat at 17051.90. At the day's high of 17,055.99, the Sensex rose 5.30 points in early trade. The Sensex fell 59.85 points at the day's low of 16990.80 in early trade.

The S&P CNX Nifty was flat at 5062.95.

The market breadth, indicating the overall health of the market was strong. On BSE, 703 shares advanced as compared with 439 that declined. A total of 40 shares remained unchanged.

From the 30 share Sensex pack, 22 fell and rest rose.

The BSE Mid-Cap index rose 0.4% and the BSE Small-cap index rose 0.46%.

Energy major Reliance Industries (RIL) fell 0.68%. The company plans an aggressive exploration campaign, investments in petrochemicals and overseas acquisitions as India's top company by market capitalisation prepares itself for the next phase of growth. The company will work towards attaining global scale for its conventional energy platform petrochemicals, refining and oil and gas exploration and invest in its new businesses such as retailing and alternative energy, chairman Mukesh Ambani said at the company's annual meeting of shareholders on Tuesday. RIL has set 27 November 2009 as the record date for a liberal 1:1 bonus share issue.

The government on Monday 16 November 2009 announced additional allocation of 51.6 million metric standard cubic metres per day (mmscmd) of natural gas from RIL's Krishna Godavari D6 field. Nearly 70% of this has been to the power sector. The move, finalised at the meeting of the ministry of petroleum and natural gas on 27 October 2009, takes the total allocation to 91.6 mmscmd from the current 40 mmscmd.

RIL on Tuesday 10 November 2009 announced its first oil discovery in its exploration block in the Cambay Basin off Gujarat. Reliance holds 100% participating interest in the block. This block was awarded to Reliance under the fifth round of the New Exploration Licensing Policy.

Oil exploration stocks rose as crude oil gained for a third day on Wednesday after an industry report showed U.S. stockpiles declined after a hurricane in the Gulf of Mexico. Oil rose as much as 0.9 % to $79.85 a barrel on Asian electronic trading. Rise in crude oil prices would result in higher realizations from crude sales for oil exploration firms.

Cairn India rose 0.41%. The company on 5 November 2009 signed a pact with Reliance Industries for supply of crude oil.

India's second biggest state-run oil exploration firm by revenue Oil India rose 0.25%. But, India's biggest state-run oil exploration firm by revenue Oil & Natural Gas Corporation (ONGC) fell 0.35%. Steel magnate Lakshmi Mittal has reportedly pulled out of a project to develop an oil block in Kazakhstan with Indian joint venture partner Oil and Natural Gas Corp. ONGC Mittal Energy was to have acquired a 25 % stake in Satpaev block from state-owned KazMunaiGaz and invested a total of $400 million in the project.

The petroleum ministry has reportedly proposed a 33% hike in the price of natural gas produced by ONGC and Oil India and gradually increase it to $4.20 per mmBtu set for gas from Reliance Industries' KG-D6 fields.

PSU OMCs fell as higher crude oil prices will increase under-recoveries on domestic sale of petrol, diesel, kerosene and LPG at controlled prices. HPCL and BPCL fell by between 0.14% to 0.22%. But Indian Oil Corporation (IOC) rose 0.5%.

Banking shares fell on profit taking. India's largest bank by net profit State Bank of India (SBI) fell 0.95%. State Bank of India said on 9 November 2009 said it had entered into an agreement with T. Rowe Price to sell a 6.5% holding each in UTI Asset Management Company and UTI Trustee Company. State Bank currently holds 25% in each of the companies and after the sale its holding would be reduced to 18.5%, it said in a statement.

SBI announced after market hours on Friday 6 November 2009 it has revised downwards interest rates on deposits by 25-50 basis points for a few maturities effective from 9 November 2009. The bank's consolidated net profit rose 28.29% to Rs 3,133.16 crore on 22% rise in consolidated income to Rs 33,101.65 crore in Q2 September 2009 over Q2 September 2008. The results were announced on 31 October 2009.

India's largest private sector bank by net profit ICICI Bank fell 0.73% as its ADR fell 0.23% on Tuesday. The bank's net profit rose 2.6% to Rs 1040.13 crore on a 12.7% decline in total income to Rs 8480.73 crore in Q2 September 2009 over Q2 September 2008. The result was announced during trading hours on 30 October 2009.

But, India's second largest private sector bank by net profit HDFC Bank rose 0.15% even as its ADR ended flat on Tuesday.

India's largest dedicated home loan lender Housing Development Finance Corporation (HDFC) fell 0.93%. The lender announced after market hours on Friday 13 November 2009 it has agreed to acquire approximately 41% in the fully diluted equity share capital of Credila Financial Services from DSP Merrill Lynch Capital.

Prime Minister Manmohan Singh said on 8 November 2009, financial reforms, such as building up a domestic bond market and expanding foreign investment in sectors like insurance, would be pushed forward.

As per reports, the government plans to introduce two key bills in parliament by December 2009. It plans to introduce bills proposing the raising of foreign stake limits in insurers to 49% from the present 26% and opening up the pension sector to private and foreign firms.

Meanwhile, the Reserve Bank of India Deputy Governor Usha Thorat said on Monday 16 November 2009 the central bank will soon issue guidelines on provisioning for bad loans by banks

India's largest engineering and construction firm by sales Larsen & Toubro fell 0.92%. The company after market hours on Tuesday said Gilbarco Inc. has bought its petroleum dispensing pump business.

Meanwhile, the company made a profit of Rs 86.14 crore by paring a third of its stake in software firm Mahindra Satyam last week. Larsen and Toubro (L&T) on Friday, 13 November 2009 sold 2.72 crore shares in Mahindra Satyam in two bulk deals at an average price of Rs 113.65 on BSE in opening trade.

IT stocks rose on gains in American depository receipts overnight in US. India's second largest software company by sales Infosys rose 1.22% as its ADR rose 1.27% on Tuesday. Infosys BPO, the business processing outsourcing subsidiary of Infosys Technologies, last week, announced the signing of a definitive agreement to acquire all of the outstanding interests of McCamish Systems LLC, a premier business process solutions provider, based in Atlanta, Georgia in the United States.

The acquisition is expected to be completed later this year subject to the satisfaction of certain closing conditions. The upfront consideration for the deal is $38 million with up to an additional $20 million payable to the sellers if McCamish Systems achieves certain financial targets in the future. The announcement was made before market hours on Thursday 12 November 2009.

India's largest software company by sales Tata Consultancy Services (TCS) rose 1.09%. The company recently secured a 150 million pounds software implementation contract for 15 years from Cardiff city council, UK.

India's third largest software company by sales Wipro rose 1.31% as its ADR rose 0.99% on Tuesday. Wipro, sees robust deal pipeline on the back of improving IT demand worldwide, Suresh Vaswani, joint chief executive said on Tuesday 10 November 2009. The company said on 5 November 2009 it had agreed to buy some personal care businesses of Yardley for about $45.5 million, adding to its consumer goods business. Wipro said it had signed an agreement with UK-based Lornamead group, which owns the Yardley brand, for the businesses in Asia, the Middle East, Australasia and some African markets.

Mahindra Satyam fell 1.76% on Tuesday rejected claims worth Rs 1,230 crore made by 37 companies linked to the company's former promoter B Ramalinga Raju in a filing to the stock exchange terming them legally untenable. Satyam received letters from these 37 companies reclaiming the money a day after Raju confessed to the Rs 7,000-crore fraud.

Valecha Engineering gained 1.43% after the company bagged two new road projects aggregating Rs 110 crore at Himachal Pradesh.

Sensex to open flat

Headlines for the day

* SAIL to set up 12mt steel plant in Chiria - DNA Money
* Reliance Industries plans big push for gas, oil exploration - Business Line
* Hindalco EGM clears plan to raise Rs2900 crore - Business Line
* L&T sells fuel dispenser biz to US firm for Rs 150 crore - Business Standard
* Tata Torrent Power cuts fuel surcharge by 1 paise - Business Standard

Events for the day
Major corporate action:
Ex-date for the interim dividend of Jetking Infotrain Ltd & Ex-date for the dividend of Banco Products India Ltd.

Pre-market report

Global signals

The European stocks opened the Tuesday in red and remain red throughout the day. At the end, FTSE 100 closed 0.68% lower at 5346.

While the US markets continue its northward journey to closed with in green. Nasdaq 100 crossed the 2200 mark and closed the day at 2204.

In today's trade, the major Asian indices showing the mixed trend in the early trading hours. Indices like Straits Times, Nikkei 225 & Hang Seng all trading in red territory. While Kospi & Shanghai Composite trading with marginally gain. And at the time of writing this report, SGX Nifty that opened strong, had lost its mornings gains and was trading lower by 5 points.

Indian markets

The domestic indices are expected to open slightly higher, remain range bound and volatile owing to the Mixed Asian cues. However with the positive signal coming from the US, domestic markets may get strength.

Among the local indices, the Nifty could test the 5100-5150 range on the up side, while on the down side it could find support at 5000 and 4920. While the Sensex is likely to get support at 16600 and may face resistance at 17300.

Indian ADR's

Among the Indian ADRs trading on the US bourses, only Infosys, Wipro & HDBC Bank managed to closed in green. While rest all of the Indian ADR closed in the Red wherein Tata Communications slides the most.

Commodity cues

It was a day of gains in the in the commodity space, wherein the Crude oil prices recorded gains, with the Nymex light crude oil for December series rising by $0.30 to settle at $79.14 a barrel.

In the metals space, Comex Silver for December series slide marginally $0.03 to settle at $18.49 to a troy ounce.

Daily trend of FII/MF investment in equities

On November 17, 2009, FIIs were the net buyers of the Indian Stocks in the tune of Rs679.30 crore (with the gross purchase of Rs2505.90 crore and gross sales of Rs1826.60 crore).

While the Domestic mutual funds, on November 16, 2009, were the net Seller of the stocks in the tune of Rs49.50 crore (with gross purchase of Rs502.90 crore and gross sales of Rs552.10 crore).

Daily News Roundup - Nov 18 2009

Reliance Industries has lined up aggressive plans for its oil and gas exploration work over the next three years to further strengthen its position in the energy business. (BS)

LN Mittal has pulled out of a project to develop an oil block in Kazakhstan with joint venture partner ONGC Videsh. (ET)

Jharkhand government has agreed to renew SAIL’s lease for the Buddhaburu mine, having reserves of 810mn tons. (BS)

NMDC and SAIL will jointly develop a limestone project at Arki in Himachal Pradesh with a 3MTPA capacity. (BS)

SAIL to spend Rs600bn for expansion in 3 years. (ET)

Bharti Airtel said it has commenced operations of its Far-East Connect Network, enabling it to serve the requirements of wholesale customers in the high growth markets across Asia and the Pacific. (ET)

TCS has recovered all its dues from American carmakers - General Motors and Chrysler. (BL)

Indian Oil is losing Rs920mn/day on sale of petrol, diesel, domestic LPG and kerosene. (ET)

Tata Motors has so far raised Rs2.6bn through the revised fixed deposit scheme which it launched in August this year. (BS)

Tata Motors, the Indian owner of Jaguar Land Rover, is hopeful of turning around the unprofitable luxury unit as it cuts costs to battle a slump in sales during the global recession. (BS)

Fiat India Automobiles Ltd, a 50:50 JV between Fiat Group and Tata Motors, plans to launch CNG driven vehicles in India by the Q1 FY11. (BL)

L&T plans to sell its petroleum dispensing pump business to US company Gilbarco Veeder-Root for ~Rs1.5bn. (BS)

L&T plans to consolidate its integrated engineering services business into one separate entity. (BL)

Hindalco Industries plans to raise Rs29bn through issue of QIP, GDR or any other securities in the near future to fund its expansion plans. (BL)

The FIPB referred to the CCEA a proposal by private carrier Jet Airways to raise about Rs20bn from foreign investors. (ET)

JSW steel is likely to spend US$500mn buying coal mines overseas to secure supplies for local expansion. (FE)

JP Associates plans to raise Rs15bn from the primary market by an initial share sale of its arm Jaypee Infratech. (FE)

Power Grid has initiated talks with BSNL to lease space from its towers. (BS)

Satyam has received legal notices from 37 companies claiming a refund of US$265mn, allegedly given as temporary advance. (BS)

Mahindra Satyam announced a strategic partnership with Gen-i one of Australia’s leading ICT service providers. (FE)

Japanese conglomerate NTT Group has entered the race to acquire a majority stake in Patni Computer. (ET)

The government has approved ArcelorMittal’s over Rs5bn FDI for acquisition of a 35% stake in steel products maker Uttam Galva. (ET)

Godrej Consumer Products plans to strengthen its roots in the rural areas through regional advertising component. (BS)

Shree Cement has lined up am major expansion plan in both its key business – cement and power with a total investment of Rs13bn. (FE)

Land acquisition is proving to be a problem for Shree Cement to carry out its expansion plans. (BS)

JK Lakshmi Cement said it will invest Rs12bn for setting up a greenfield plant at Durg (Chhattisgarh). (ET)

Mahindra Lifespace Developers has been shortlisted by the Mauritius government to build a new city on the island. (ET)

Torrent Power has reduced fuel surcharge by one paise per unit. (BS)

Nestle India launched a new range of instant pasta products, ‘Maggi Nutri-Licious Pazzta’, in two flavours and priced at Rs12 and Rs15. (BL)

Brigade plans to invest Rs20bn over the next four years to build compact residential properties, ‘Brigade Value Homes’, in Bangalore. (BS)

Godrej Properties plans to invest Rs2bn for its maiden a commercial and office space project ‘Godrej Eternia’ in Chandigarh. (BS)

Nitesh Estates is learnt to have planned to raise nearly Rs10bn through sale of shares of a special purpose vehicle (SPV). (ET)

Jayashree Chemicals, a caustic soda producing company, has agreed to procure the salt from the farmers at Rs1,050/ton. (BS)

The government plans to allow railways and power projects to borrow from IIFCL. (BS)

State-owned UCO Bank expects to receive Rs7.5bn from the government this month to shore up capital. (BS)

Hyundai Motor India will continue to be aggressive with its product launches in the compact car segment to protect and grow its market share. (BL)

BSNL is likely to exit the consortium comprising Delhi-based Vavasi Group and Malaysia's Al-Bukhary to acquire 46% in Kuwait’s Zain Telecom. (BS)

Himachal Pradesh government has urged the Centre to extend the industrial package from 2010 to 2013. (BS)

The North West Region of the Income Tax Department comprising Jammu and Kashmir, Himachal Perdesh, Punjab, Haryana and the Union Territory of Chandigarh registered 13.7% growth in collection of direct taxes to Rs59.8bn till 16 November 2009 as compared to the corresponding period last year. (BS)

The Direct tax collections have grown sharply in many smaller cities in the April-October period, in contrast to the big ones where they have either fallen or grown at low single-digit rates. (ET)

The proposal for a single regulator for organized trading of all financial market instruments is gaining momentum with the Union finance ministry starting internal discussions on the issue. (BS)

Life insurance renewal premium jumped 18.6% to Rs624bn during first half of the current financial year, while ULIPs registered 34% growth to Rs254bn. (BS)

A panel set up by RBI has recommended setting up of an emergency fund to help urban co-operative banks tide over liquidity problems. (BS)

The RBI has asked leading finance companies, bond houses and securities firms to disclose details on all structured debentures floated by them to raise money. (ET)

The Finance and Investment Committee of EPFO is scheduled to meet on December 1 to take a final call on investing ~Rs130bn a portion of its corpus in the capital markets. (BS)

The Andhra Pradesh government has agreed to pass on the purchase tax incentive of Rs60/ton to sugarcane growers during the 2009-10 season. (BL)

The Designated Authority in the Commerce Ministry has recommended imposition of preliminary anti-dumping duty on the import of Digital Versatile Discs-Recordable (DVD-R and DVD-RW) from Malaysia, Thailand and Vietnam. (BL)

Apprehending the misuse of the concept ‘class action suit’, the government is considering a proposal to change the norms on such a suit specified in the Companies Bill, 2009. (BL)

The Communications Minister will meet the Finance Minister and the Defence Minister to end the stalemate on 3G spectrum vacation by the armed forces. (BL)

The Corporate Affairs Minister said the government could come up with norms on CSR credits on the lines of carbon credits and companies can trade in such credits. (BL)

State run National Aviation Company of India, which runs Air India and Indian Airlines, would receive the first installment of equity infusion by the government worth Rs4bn by January. (ET)

The Centre has suggested to the state governments that they should create industrial land banks from available waste and fallow lands, to avoid confrontation with farmers over acquisition of agricultural plots for industrial purposes. (ET)

The government will take help of the department of posts in providing unique identity number to people in the less-accessible parts of the country. (ET)

In a bid to accelerate the infrastructure projects through public private partnership initiatives in India, the Asian Development Bank (ADB) has decided to provide close to US$700mn in loans. (FE)

Longing for shorting?

Although our intellect always longs for clarity and certainty, our nature often finds uncertainty fascinating.

The bears failed to make a big dash last month, but could yet again be licking their lips as the market struggles for direction. The fascinating thing is that every time the bears have attempted a comeback; the bulls have managed to make them run for cover. As a result, stocks are seeing dips and spikes without any significant change in the overall scenario.

Today we see another anemic start and a lackluster day. The key indices could continue to rise steadily and make new highs for the year. But, beyond a point they are likely to meet with some resistance. That level may turn out to be around 5200-5300 on the Nifty.

After a Marvelous Monday things have turned a bit quiet. Traded volume has cooled off from last week. Sensex and Nifty appear to be struggling above 17000 and 5000, respectively yet again. Technical and derivatives indicators are indecisive as well. Stick to stock specific action and keep a close track of relevant developments, both local and global, and you should do fine.

Inflows from local funds have turned negative though the overseas investors remain bullish. In short, the market is facing some resistance though there are no signs of a big selloff, not at least in the near term. We expect the market to trade sideways with a positive bias, depending on the trend in global markets.

FIIs were net buyers in the cash segment on Tuesday at Rs4.63bn on a provisional basis. The local funds were net sellers of Rs2.35bn, according to figures published on the NSE's web site. In the F&O segment, the foreign funds were net sellers at Rs3.25bn. The foreign funds were net buyers of Rs6.79bn on Monday. Mutual funds were net sellers of Rs492mn in the cash segment on the same day. FIIs' net investments in Indian stocks this year has crossed $15bn, as per SEBI's web site.

US market rose for the nine time in the last 11 sessions, with the housing market returning to the spotlight as Home Depot reported signs of stabilization. European shares, however halted their recent advances, pressured by weakness in the banking sector. Most Asian stock markets ended slightly lower on Tuesday and are mixed this morning.

Gold extended its record-breaking run, helped by news of fresh central bank buying, while oil prices dipped after a strong rise in the previous session. Pound sterling rose to a two-month high against the euro on Tuesday after higher-than-expected UK inflation in October. Waning risk appetite took momentum from the FTSE 100, which fell back from year-highs as traders booked profits.

US stocks recovered from early losses to end a tad higher on Tuesday, closing at 13-month highs for the second day in a row, as strength in the commodity space offset weakness in the retail sector.

The Dow Jones Industrial Average rose about 30 points, or 0.3%, to close at 10,437.42. The S&P 500 index finished nearly unchanged above the key 1,100 level. The Nasdaq Composite advanced 0.3% to end at 2,203.78. All three indexes are at their highest levels since October 2008.

Stocks opened lower and struggled for most of the day as the dollar regained ground against rival currencies, reflecting a decreased appetite for risky assets. The tone improved in the last few hours of trading as oil and gold prices reversed direction.

The rebound in commodity prices boosted shares of energy and materials companies. But gains were limited by weakness in the retail sector after Home Depot and Target offered cautious earnings outlooks.

Tuesday's economic news was mixed. Government data showed inflation at the wholesale level remains subdued, while industrial production was weaker than expected in October.

Globally, the stock markets continue to look to the dollar for direction. When the US currency is weak, investors pile up on risky assets. If it is strong, they shed the risk a little bit. The dollar has hovered near a 15-month low against rival currencies in recent weeks.

However, after lifting the major indexes from lows of early March, investors have become a touch wary of going too aggressive on equity as the economic outlook remains cloudy.

The government reported that the Producer Price Index (PPI), the key measure of inflation for manufacturers, edged up 0.3% in October. Core PPI, which excludes volatile food and energy prices, fell 0.6%. The PPI was expected to have risen 0.5% for the month, according to a consensus of economists. The core was expected to have edged up 0.1% in October.

Before the start of market trading, the government also reported that industrial production rose 0.1% last month versus a forecasted 0.4% increase. In September, production rose 0.7%. Capacity utilization rose by 0.2% to 70.7%, a rate slightly below economists' expectations for 70.8%.

Home Depot reported a decline in third-quarter earnings to 41 cents per share from 45 cents in the year-ago quarter. While the results were better than 36 cent per share profit that analysts had expected, the company said it expects earnings for the full year to be down 13%.

Discount retailer Target reported an 18% increase in third-quarter profit, helped by gains in the company's credit card portfolio. But Target, which had suffered declining profits for the last eight quarters, remained cautious about the outlook for holiday spending.

TJX, which owns the TJ Maxx and Marshalls chains, reported a larger-than-expected quarterly profit on increased consumer demand for discount products. The company said it expects profit from continuing operations of 65 cents to 71 cents per share in the fourth quarter. Analysts surveyed by Thomson Reuters are forecasting a profit of 71 cents per share in the fourth-quarter.

On the higher end, Saks reported a quarterly profit, surprising analysts who were expecting the company to report a loss. However, the results were driven mostly by cost-cutting, and the company offered a cautious outlook.

Treasury prices rose, with the yield on the 10-year note falling to 3.33%.

The weak dollar recovered a little Tuesday. The dollar index, which measures the US currency against a basket of rivals, was up 0.7% to 75.38 from 74.92.

Oil prices rose 24 cents to settle at $79.14 barrel in New York.

The price of gold closed at an all-time high of $1,139.40 an ounce, up 20 cents from Monday's record close of $1,139.80.

Investors will digest reports on consumer prices and initial construction of new homes Wednesday morning. Later in the week, the government will report on the number of Americans filing first-time claims for unemployment benefits.

Meanwhile, European shares ended a four-session streak of gains, closing lower as automakers pared recent gains and banks came under pressure on concerns about capital levels.

After touching a 13-month high on Monday, the pan-European Dow Jones Stoxx 600 index fell 0.4% to close at 250.36.

The UK's FTSE 100 index declined 0.7% to end at 5,345.93, while Germany's DAX index lost 0.5% to settle at 5,778.43 and the French CAC-40 index shed 0.9% to finish at 3,829.06.

It was an absolute Tuesday twister for the Indian markets. After starting off with a negative bias and staying in the red till the last trading hour, a sudden bout of buying in the IT, Banking, Capital Goods and the Metals stocks aided the benchmark indices to end with mild gains.

NSE Nifty recovered nearly 50 points to close above 5,050 and the BSE Sensex recouped 170 points to shut above the 17,000 mark.

The IT stocks were in the limelight throughout the day, stocks like Infosys, TCS and Wipro were among the star performers, even the mid-cap IT stocks like Polaris, Mphasis and MindTree were in demand.

The index heavyweight Reliance Industries which held its Annual General Meeting today put on a disappointing show, the stock ended in the red, down by 0.7% at Rs2133.

Finally, the BSE Sensex rose 18 points to end at 17,050 after touching a high of 17,080 and a low of 16,882. The index opened at 16,052 against the previous close of 17,032. The NSE Nifty ended flat at 5,062.

In Asia, the Nikkei in Japan was down 0.6%, while Australia's S&P/ASX ended lower by 0.5% at 4,729. Shanghai SE Composite was up 0.5% and Hang Seng index in Hong Kong fell 0.5%.

In Europe, stocks were trading in the red. The DAX in Germany was down 0.2% and the CAC 40 index in France was down 0.2%. The FTSE in the UK was down 0.4%.

Coming back to India, among the BSE sectoral indices, the IT index was the top gainer, adding 2%, followed by the Teck index that was up 1% and the BSE Consumer Durables index was up 0.6%.

Major losers were BSE Realty index down 1.2% and BSE Oil & Gas index down 0.8%.

The BSE Mid-Cap index ended flat while the BSE Small-Cap index was marginally up by 0.2%.

Among the 30-components of Sensex, 15 stocks ended in the green and 15 ended in the negative terrain. TCS, Hero Honda, Infosys and Reliance Infra were among the top gainers.

On the other hand, among the major losers were ONGC, ACC, DLF, Bharti Airtel and RCom.

Outside the frontline indices, the big gainers in the broader market were Spice Tele, Glenmark Pharma, GMDC, Sintex Industries and Aban Offshore. On the other hand, losers included Hindustan Copper, United Phos, Mundra Port and RCF.

Shares of the Aviation firms’ crash landed after media reports flashed that the ministry said that it sees no reason to raise the existing FDI limit.

Shares of Kingfisher Airlines fell over 5% to Rs52.9, Jet Airways slipped by 2.3% to Rs445 and SpiceJet fell 3.5% to Rs46.2.

Shares of HDFC ended flat at Rs2754. The company along with Standard Life, UK plans to infuse Rs3bn in its life insurance venture HDFC Standard Life in H2FY10.

In the previous week, HDFC also diversified into education loans. It acquired a 41% stake in Credila Financial Services, a company that specialises in education loans, for Rs100mn. HDFC has acquired the stake from Merrill Lynch, which was an initial investor in the company.

Shares of Bharat Forge advanced by 2% to Rs274 after reports stated that the company is planning to foray into the power sector with an investment of up to Rs500bn with a targeted generation capacity of up to 10,000MW, over the next 10 years.

Reports stated that the company plans to set up power plants in Gujarat, Maharashtra, coastal Andhra Pradesh and Tamil Nadu.

Shares of Glenmark gained by 5.5% to Rs242 after reports stated that the company has settled patent litigation with Medicis Pharmaceutical Corporation and has entered into a co-development arrangement on its specialty drug to treat acne.

The stock opened at Rs229 and made an intra-day high of Rs244 and a low of Rs229. Total traded volumes stood at 0.7mn shares.

Turnover declines sharply

Aban Offshore November 2009 futures at premium

Nifty November 2009 futures were at 5,055.20, at a discount of 2.85 points as compared to spot closing of 5,058.05. Turnover in NSE's futures & options (F&O) segment was Rs 58,411.07 crore, sharply lower than Rs 72,277.97 crore on Friday, 13 November 2009.

Aban Offshore November 2009 futures were at premium at 1293.80 compared to the spot closing of 1288.05.

Reliance Industries November 2009 futures were at a slight premium at 2152 compared to the spot closing of 2150.

Tata Steel November 2009 futures were near spot price at 535.75 compared to the spot closing of 535.90.

In the cash market, the S&P CNX Nifty rose 59.10 points or 1.18% at 5,058.05.

Sensex settles above 17,000; Nifty above 5,000

The key benchmark indices surged as the US dollar weakened against its major rivals. Stocks rose across the globe. The BSE 30-share Sensex jumped 83.68 points or 1.09%. The BSE Sensex today, 16 November 2009, crossed the psychological 17,000 mark and S&P CNX Nifty breached the key 5,000 mark. Both these two key indices scaled their highest closing level in nearly one month

Banking, realty, metal and auto stocks rose. But IT stocks fell. The market breadth was strong.

The dollar slipped against major rivals on Monday, 16 November 2009, pressured by stepped-up rhetoric from China, better-than-expected Japanese growth data and rising gold futures. The dollar index, which measures the greenback against six major currencies, was recently down 0.5% at 74.93.

The dollar was also under pressure after China's chief banking regulator on Sunday, 15 November 2009, criticized loose US monetary policy as leading to increased speculation. The yen, meanwhile, got a lift from better-than-expected Japanese gross domestic product data.

The dollar index has tumbled from a three-year high reached in March 2009, on speculation the US Federal Reserve will be slow in raising borrowing costs. With short-term interest rates very low, global traders have turned to borrowing funds cheaply in the US and then reinvesting the proceeds in equities and commodities, looking to lock in higher returns and benefiting from further erosion in the dollar. These so called US dollar carry trades have kept putting pressure on the dollar as investors short the currency to invest elsewhere.

There has been a solid surge in inflows in emerging markets equity funds this year. But a strong rebound in dollar, if any, may result in unwinding of the so called US dollar carry trade positions by traders/institutions. This may hit emerging markets equities hard.

Cabinet Secretary KM Chandrasekhar today said food prices will moderate as supply constraints ease. He said the government is monitoring sugar prices and it will take more action to contain prices if needed.

There are no fears of government borrowing crowding out private borrowing in India, finance minister Pranab Mukherjee said at an industry conference on Monday.

The economy could expand between 6 and 7% in the year to March 2010 despite a bad monsoon, Mukherjee said on Saturday as data showed accelerating inflation in October. Speaking in the Sri Lankan capital Colombo, Mukherjee said there were risks to an early global economic recovery and signs asset price bubbles were re-emerging.

Inflation based on the wholesale price index accelerated in October 2009 from a month earlier on costlier minerals and fuels. On Saturday, the government switched to using monthly inflation data for all commodities with 1993/94 as the base year, from the earlier practice of announcing weekly price movement. The wholesale price index was up 1.34 % in October 2009 from a year earlier, compared with 0.5 % rise in September 2009 and 11.06 % jump a year ago. Food prices, however, declined by 1 % from the previous month's level, while minerals and industrial fuels were each costlier by 3%.

At its policy review last month, the Reserve Bank of India (RBI) lifted its inflation forecast to 6.5% for the end of 2009/10 fiscal year in March, but left policy rates unchanged. The RBI also laid the groundwork for a rise in interest rates by tightening credit to the commercial property sector and removed some of the emergency liquidity support steps that were extended to protect the economy from the global downturn.

Industrial output grew 9.1% in September 2009 from a year earlier, helped by stimulus and festival demand, and adding to the debate on the timing of exit policy. The RBI forecast the economy would expand 6% in 2009/10, below 6.5 % predicted by the prime minister's economic panel. It grew 6.7% last year, slowing sharply from 9% or more between 2005/06 and 2007/08.

Meanwhile, the government aims to sell shares of about 60 state-run firms in the coming years, with offers for NTPC and Rural Electrification Corp expected by end-March 2010, disinvestment Secretary Sunil Mitra said on Friday 1 November 2009. He also said the finance ministry was in talks with other ministries to launch public offers of Steel Authority of India, miner NMDC, Coal India and telecoms firm BSNL.

The cabinet will soon consider selling part of government's stake in Steel Authority of India and NMDC, Steel Minister Virbhadra Singh told reporters on Monday.

The cabinet recently approved a long-pending divestment policy that mandates at least 10% public holding in state-run firms and use the proceeds for social schemes until March 2012, to cut its fiscal deficit.

European shares advanced for the fourth straight session on Monday, with commodity stocks leading the gainers as raw material prices benefited from a weaker US dollar, but retailer H&M fell after weak October sales. The key benchmark indices in France, Germany and UK were up by between 0.81% to 1.44%.

New passenger car registrations in Europe rose 11.2% to 1.26 million in October 2009 year-on-year, driven by growth in the Western European markets, the European Automobile Manufacturers' Association said Monday.

Asian stocks gained on Monday after upbeat reports from US retailers underpinned confidence the global economy is recovering. The key benchmark indices in Hong Kong, South Korea, Singapore and Taiwan rose by between 1.3% to 2.08%.

China's Shanghai Composite Index jumped 2.74%, aided by economic data showing foreign direct investment (FDI) into China climbed for a third straight month. FDI rose 5.7% to $7.1 billion in October 2009, after rising 18.9% on year in September 2009, the state-run Xinhua news agency reported, citing data from the Ministry of Commerce. In the first ten months of the year foreign domestic investment totaled $70.87 billion, down 12.6% from a year earlier.

Data released last week showed China's industrial production and retail sales accelerated at faster than expected pace, although consumer and producer prices were generally softer than expected

China's economy is expected to grow by about 8.5 % next year while inflation will remain modest at about 2.5 %, indicating that monetary policy should remain appropriately loose to solidify the basis of the recovery, a key government think-tank said on Monday. The State Information Centre added that the risks of rapid credit growth could be contained and that a tightening of monetary policy would have only limited effectiveness in curbing asset price bubbles, in a report carried by the official China Securities Journal.

US President Barack Obama said on Monday that Washington was not trying to contain China's rise but said trade between the two giants needed to be more balanced. Addressing students at a town hall-style meeting in Shanghai on the first full day of his first trip to China, Obama said the notion that Washington and Beijing must be adversaries was not pre-destined.

Japan's Nikkei rose 0.21%. Japan's economy expanded at the fastest pace in more than two years in the third quarter, led by a rebound in domestic demand that may ease concern of a return to recession next year. Gross domestic product rose at an annual 4.8% pace, after a 2.7% gain in the second quarter, Cabinet Office figures showed today in Tokyo.

Meanwhile, Japanese Trade Minister Masayuki Naoshima apologized for speaking about price sensitive third-quarter GDP data to oil industry executives on Monday ahead of its official release in an embarrassment for a government that took power two months ago.

Trading in US index futures indicated Dow could gain 62 points at the opening bell on Monday, 16 November 2009.

US stocks rose on Friday, setting up a second straight week of gains, as upbeat retail news reinforced hopes for strong sales in the key holiday season. The Dow Jones Industrial Average roseor 73 points or 0.71%, to close at 10,270. The Nasdaq gained about 18 points or 0.87% at 2176, and the S&P 500 was up 6.24 points or 0.57% at 1093.

Obama said on Sunday the world economy was on a path to recovery but warned that failure to re-balance the global economic system would lead to further crises. Obama was addressing Asia Pacific leaders in Singapore.

Leaders of the 21-member Asia Pacific Economic Cooperation forum pledged on Sunday to conclude Doha global trade talks in 2010 and to reject protectionism, but dropped earlier draft references to "market-oriented exchange rates" and to emissions cuts.

Kansas City Fed President Thomas Hoenig said on Monday that the US economy still faced significant weaknesses and he urged policymakers to allow large financial institutions to fail if needed. Hoenig was speaking at a central bank event in Abu Dhabi, the capital of the United Arab Emirates.

The BSE 30-share Sensex rose 183.68 points or 1.09% to 17,032.51, its highest closing since 20 October 2009. At the day's high of 17083.20, the Sensex rose 234.37 points in mid-afternoon trade. The Sensex rose 44.28 points at the day's low of 16893.11 in early trade.

The S&P CNX Nifty rose 59.10 points or 1.18% to 5058.05, its highest closing since 21 October 2009. Nifty hit a high of 5073.20. Nifty November 2009 futures were at 5,055.20, at a discount of 2.85 points as compared to spot closing of 5,058.05. Turnover in NSE's futures & options (F&O) segment was Rs 58,411.07 crore, sharply lower than Rs 72,277.97 crore on Friday, 13 November 2009.

The market breadth, indicating the overall health of the market was strong. On BSE, 1752 shares advanced as compared with 1013 that declined. A total of 90 shares remained unchanged.

From the 30 share Sensex pack; 26 rose and rest fell.

BSE clocked a turnover of Rs 4377 crore, lower than Rs 5312.04 crore on Friday, 13 November 2009.

The market has risen sharply in the past few days. From a recent low of 15,404.94 on 3 November 2009, the Sensex has jumped 1,627.57 points or 10.56% in a short period of time, at current 17,032.51 on 16 November 2009. The Sensex is up 7385.20 points or 76.55% in calendar year 2009, as on 16 November 2009. From a 3-year closing low of 8,160.40 on 9 March 2009, the Sensex is up 8872.11 points or 108.72% as on 16 November 2009.

Coming back to today's trade, the BSE Mid-Cap index rose 1.14% and the BSE Small-cap index rose 1.22%. Both the indices outperformed the Sensex.

The BSE Realty index (up 3.15%), the BSE Auto index (up 2.9%), the BSE Metal index (up 2.41%), the BSE Oil & Gas index (up 1.37%), the BSE Consumer Durables index (up 1.16%), outperformed the Sensex.

The BSE IT index (down 0.28%), the BSE Teck index (up 0.21%), the BSE Capital Goods index (up 0.69%), the BSE PSU index (up 0.7%), the BSE FMCG index (up 0.76%), the BSE Healthcare index (up 0.83%),the BSE Power index (up 0.92%), the BSE Bankex (up 0.98%), underperformed the Sensex.

Energy major Reliance Industries (RIL) rose 1.47% to Rs 2147.75. But the stock came off the day's high of Rs 2158.80. RIL may reportedly join global oil majors in search of shale gas. RIL has been studying the breakthroughs and the new technologies that are being used in producing shale gas that is now a huge rage in the US, reports suggest.

Reliance Industries (RIL) on Friday offered to withdraw affidavits filed by seven of its directors, claiming they were unaware of the contents of the memorandum of understanding (MoU) signed between members of the Ambani family in 2005 for supply of gas from the Krishna-Godavari basin, only if Reliance Natural Resources (RNRL) agreed to withdraw an assertion in its affidavit that the RIL board had seen and approved the MoU. RIL and RNRL are currently fighting the gas price dispute in the supreme court.

RIL on 10 November 2009 said reports of a meeting between the billionaire Ambani brothers to settle a gas-pricing dispute were baseless. RIL said in a statement the matter would be decided by the Supreme Court, which is currently hearing the case.

RIL on Tuesday 10 November 2009 announced its first oil discovery in its exploration block in the Cambay Basin off Gujarat. Reliance holds 100% participating interest in the block. This block was awarded to Reliance under the fifth round of the New Exploration Licensing Policy.

India's largest engineering and construction firm by sales Larsen & Toubro rose 0.43% to Rs 1650.65. But the stock came off the day's high of Rs 1669. The company made a profit of Rs 86.14 crore by paring a third of its stake in software firm Mahindra Satyam. Larsen and Toubro (L&T) on Friday, 13 November 2009 sold 2.72 crore shares in Mahindra Satyam in two bulk deals at an average price of Rs 113.65 on BSE in opening trade.

Among other capital goods stocks, Bharat Heavy Electicals, ABB, BEML, Thermax rose by between 0.12% to 1.5%.

Metal stocks rose as a gauge of six metals traded on the London Metal Exchange, rose 0.27% on Friday, 13 November 2009. Sterlite Industries rose 3.55% even on reports a Texas judge has issued final approval of Grupo Mexico's plan to regain control of copper miner Asarco, ending a lengthy takeover battle with rival suitor Sterlite Industries. The ruling will return control of Asarco to Americas Mining Corporation, a Grupo Mexico subsidiary. The deal is expected to close by mid-December

National Aluminium Company rose 1.11%. The company recently hiked the prices of aluminium products by Rs 1000 a tonne reflecting the recent uptrend in prices on the London Metal Exchange.

Hindustan Zinc and Hindalco Industries rose by between 2.6% to 2.99%.

Bur NMDC fell 0.22% after the steel minister said disinvestment process in the state-run firm will begin in the current financial year.

Steel Authority of India (Sail) rose 0.91% after the steel minister said the cabinet will soon consider selling part of government's stake in Steel Authority of Steel. Meanwhile, Sail chairman today said the company has cut flat product prices by Rs 500 per tonne

Tata Steel, the world's eighth largest steelmaker by output, rose 2.65%. The company said on Thursday 12 November 2009 it approved a new convertible bonds offer in exchange for an existing $875 million securities to reduce costs and ease repayment obligations. The company said on 6 November 2009 steel sales at its Indian operations rose 38% to 462,000 tonnes in October 2009 over October 2008.

Demand for steel remains strong from auto, rural construction and infrastructure sectors. Also demand for construction grade steel has improved post monsoon season, and has resulted into higher sales.

Rate sensitive auto stocks rose as low interest rates and attractive benefits offered by companies pushed up sales in October 2009.

India's largest small car marker by sales Maruti Suzuki India rose 5.45%. The company's total sales grew 32.4% to 85415 units in October 2009, compared with 64490 units posted in the same month a year ago.

India's largest truck marker by sales Tata Motors rose 2.32%. Its UK unit Jaguar Land Rover is reportedly expected to announce on Monday that it has secured a 170-million-pound ($282.5 million) working capital facility from GE Capital.

India's second largest bike marker by sales Bajaj Auto rose 3.57%. Carlos Ghosn, chief executive of French car maker Renault and Japan's Nissan Motor Co, said on Tuesday an agreement had been signed with Bajaj Auto for a low-cost car which would come to India in 2012.

India's largest bike marker by sales Hero Honda Motors rose 3.82%. The company reported a marginal increase in October sales at 354,156 units as against 352,449 units in the same month last year

India's largest tractor maker by sales Mahindra & Mahindra 1.79%. The company's overall sales climbed 32% in October this year to 18,410 units against 13,935 units in the same month last year.

Car sales in India rose an annual 34% to 132,615 units in October 2009, boosted by festival demand and easier availability of loans, an industry body said on Wednesday 11 November 2009. Sales of trucks and buses, a gauge of economic activity, rose 52% to 42,562 units in October 2009, the data showed.

Rate sensitive realty shares rose on bargain hunting after a recent steep fall. Omaxe, Unitech, Indiabulls real Estate, DLF, Parsvnath Developers rose by between 1.19% to 4.54%.

Ansal Properties & Infrastructure surged 9.01% after the company's board approved allotment of 96.27 lakh equity shares to Mauritius-based IPRO Funds, a foreign fund, under preferential allotment.

Realty stocks corrected recently after the RBI, late last month, raised the provisioning requirements for loans to commercial real estate from 0.4% to 1% at a regular monetary policy review. The latest RBI move will result in increase in borrowing costs for realty firms which depend heavily on borrowing. 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 in its quarterly policy review.

Banking shares rose on hopes of financial sector reforms. India's largest private sector bank by net profit ICICI Bank rose 1.04%. Its ADR rose 0.86% on Friday 13 November 2009. The bank's net profit rose 2.6% to Rs 1040.13 crore on a 12.7% decline in total income to Rs 8480.73 crore in Q2 September 2009 over Q2 September 2008. The result was announced during trading hours on 30 October 2009.

India's largest bank by net profit State Bank of India (SBI) rose 2%. State Bank of India said on 9 November 2009 said it had entered into an agreement with T. Rowe Price to sell a 6.5% holding each in UTI Asset Management Company and UTI Trustee Company. State Bank currently holds 25% in each of the companies and after the sale its holding would be reduced to 18.5%, it said in a statement.

SBI announced after market hours on Friday 6 November 2009 it has revised downwards interest rates on deposits by 25-50 basis points for a few maturities effective from 9 November 2009. The bank's consolidated net profit rose 28.29% to Rs 3,133.16 crore on 22% rise in consolidated income to Rs 33,101.65 crore in Q2 September 2009 over Q2 September 2008. The results were announced on 31 October 2009.

But, India's second largest private sector bank by net profit HDFC Bank was flat even as its ADR rose 2.82% on Friday.

India's largest dedicated home loan lender Housing Development Finance Corporation (HDFC) was flat at Rs 2760. The lender announced after market hours on Friday 13 November 2009 it has agreed to acquire approximately 41% in the fully diluted equity share capital of Credila Financial Services from DSP Merrill Lynch Capital.

Prime Minister Manmohan Singh said on Sunday, 8 November 2009, financial reforms, such as building up a domestic bond market and expanding foreign investment in sectors like insurance, would be pushed forward.

As per reports, the government plans to introduce two key bills in parliament by December 2009. It plans to introduce bills proposing the raising of foreign stake limits in insurers to 49% from the present 26% and opening up the pension sector to private and foreign firms.

Meanwhile, the Reserve Bank of India Deputy Governor Usha Thorat said on Monday the central bank will soon issue guidelines on provisioning for bad loans by banks

IT stocks fell on reports a new tax rule in the European Union (EU) will put a renewed squeeze on profit margins of companies such as Tata Consultancy Services, Infosys and Wipro. Starting 1 January 2010 the 27-nation bloc plans to impose value-added tax (VAT) on services delivered from non-EU nations such as India. A strong rupee also weighed on IT stocks.

India's second largest software company by sales Infosys fell 0.34% even as its ADR rose 2.85% on Friday. Infosys BPO, the business processing outsourcing subsidiary of Infosys Technologies, on Thursday announced the signing of a definitive agreement to acquire all of the outstanding interests of McCamish Systems LLC, a premier business process solutions provider, based in Atlanta, Georgia in the United States.

The acquisition is expected to be completed later this year subject to the satisfaction of certain closing conditions. The upfront consideration for the deal is $38 million with up to an additional $20 million payable to the sellers if McCamish Systems achieves certain financial targets in the future. The announcement was made before market hours on Thursday 12 November 2009.

India's largest software company by sales Tata Consultancy Services (TCS) fell 0.63%. The company recently secured a 150 million pounds software implementation contract for 15 years from Cardiff city council, UK.

Bur, India's third largest software company by sales Wipro rose 0.55% as its ADR rose 2.11% on Friday. Wipro, sees robust deal pipeline on the back of improving IT demand worldwide, Suresh Vaswani, joint chief executive said on Tuesday 10 November 2009. The company said on 5 November 2009 it had agreed to buy some personal care businesses of Yardley for about $45.5 million, adding to its consumer goods business. Wipro said it had signed an agreement with UK-based Lornamead group, which owns the Yardley brand, for the businesses in Asia, the Middle East, Australasia and some African markets.

Indian rupee rose on Monday, boosted by gains in regional stock markets and tracking broad weakness in the dollar. The partially convertible rupee was at 46.21/23, stronger than Friday's close of 46.31/32. A firm rupee adversely affects operating profit margins of IT firms as the sector derives a lion's share of revenue from exports.

UltraTech Cement, a unit of conglomerate Aditya Birla Group, rose 1.49%, paring gains after more than 8% jump in early trade after it absorbed sister unit Samruddhi Cement, to form the country's biggest cement firm. The move, flagged in October 2009, was approved by the boards of both companies on Sunday. In October, the group said it will hive off the cement business of flagship firm Grasim Industries into unit Samruddhi in a cashless transaction and later merge it with group firm UltraTech. Samruddhi shareholders will receive four shares of UltraTech for every seven held in Samruddhi. UltraTech will also issue 14.95 crore new shares, boosting its capital to Rs 274 crore. Shares of Grasim Industries rose 2.07%.

Among other cement stocks, ACC, Ambuja Cements and Birla Corporation rose by between 0.24% to 1.4%.

Some PSU stocks rose as Prime Minister Manmohan Singh on 5 November 2009, approved divestment in public sector companies to raise funds for social welfare. Chennai Petroleum, MTNL, Central Bank of India, Power Finance Corporation rose by between 0.3% to 2.46%.

Some construction shares rose as 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. A government panel has approved eight road projects worth Rs 10880 crore ($2.34 billion), the finance ministry said in a statement late last week. Era Infra Engineering, Valech Engineering, Jaiprakash Associates, Gayatri Projects rose by between 0.71% to 13.77%.

FMCG stocks rose on bargain hunting. ITC, Hindustan Unilever, Dabur India, Marico rose by between 0.45% to 2.19%.

Telecom stocks rose as the process for auctioning third generation (3G) radio frequencies or spectrum that is vital for telecom companies to offer high-end services such as ultra fast internet and data services on the mobile, kicks off in New Delhi today with the pre-bid conference. India's second largest mobile services provider by sales Reliance Communication rose 3.05%. As per recent reports the company is in talks with Canadian firm Iseemedia Inc to introduce low-cost e-mail services on phones.

Bharti Airtel India's top mobile operator by sales rose 0.53% The company added 27 lakh users in October 2009, taking its total subscriber base to 11.32 crore. Idea Cellular rose 2.18%.

The Cellular Operators' Association of India (COAI) said last week its members added 1.02 crore users to their GSM networks in October, taking their total subscribers to 35.52 crore.

During the meet, officials from the communication ministry will seek to clarify as well as address all queries regarding the 3G and WiMAX auctions which are scheduled to begin in mid-January 2010, reports suggest

India's largest thermal power producer by sales NTPC fell 0.16%. A 5% stake sale in state-run power producer could fetch the government Rs 8100 crore ($1.7 billion), Sunil Mitra, a senior finance ministry official, said on Friday 13 November 2009.

Last month, the cabinet approved share sales for NTPC, Satluj Jal Vidyut Nigam and Rural Electrification Corp. Mitra said. Rural Electrification Corporation rose 5.54%.

But among other power stocks, Torrent Power, Reliance Infrastructure Reliance Power and GVK Power & Infrastructure rose by between 0.34% to 5.33%.

Cals Refineries clocked highest volume of 2.32 crore shares on BSE. Suzlon Energy (2.18 crore shares), Mahindra Satyam (0.84 crore shares), SpiceJet (0.77 crore shares) and Unitech (0.67 crore shares) were the other volume toppers in that order.

Suzlon Energy clocked the highest turnover of Rs 157.20 crore on BSE. State Bank of India (Rs 117.19 crore), Reliance Industries (Rs 111.90 crore), DLF (Rs 107 crore) and Tata Steel (Rs 104.85 crore) were the other turnover toppers in that order.

Sensex settles above 17,000; Nifty above 5,000

The key benchmark indices surged as the US dollar weakened against its major rivals. Stocks rose across the globe. The BSE 30-share Sensex jumped 83.68 points or 1.09%. The BSE Sensex today, 16 November 2009, crossed the psychological 17,000 mark and S&P CNX Nifty breached the key 5,000 mark. Both these two key indices scaled their highest closing level in nearly one month

Banking, realty, metal and auto stocks rose. But IT stocks fell. The market breadth was strong.

The dollar slipped against major rivals on Monday, 16 November 2009, pressured by stepped-up rhetoric from China, better-than-expected Japanese growth data and rising gold futures. The dollar index, which measures the greenback against six major currencies, was recently down 0.5% at 74.93.

The dollar was also under pressure after China's chief banking regulator on Sunday, 15 November 2009, criticized loose US monetary policy as leading to increased speculation. The yen, meanwhile, got a lift from better-than-expected Japanese gross domestic product data.

The dollar index has tumbled from a three-year high reached in March 2009, on speculation the US Federal Reserve will be slow in raising borrowing costs. With short-term interest rates very low, global traders have turned to borrowing funds cheaply in the US and then reinvesting the proceeds in equities and commodities, looking to lock in higher returns and benefiting from further erosion in the dollar. These so called US dollar carry trades have kept putting pressure on the dollar as investors short the currency to invest elsewhere.

There has been a solid surge in inflows in emerging markets equity funds this year. But a strong rebound in dollar, if any, may result in unwinding of the so called US dollar carry trade positions by traders/institutions. This may hit emerging markets equities hard.

Cabinet Secretary KM Chandrasekhar today said food prices will moderate as supply constraints ease. He said the government is monitoring sugar prices and it will take more action to contain prices if needed.

There are no fears of government borrowing crowding out private borrowing in India, finance minister Pranab Mukherjee said at an industry conference on Monday.

The economy could expand between 6 and 7% in the year to March 2010 despite a bad monsoon, Mukherjee said on Saturday as data showed accelerating inflation in October. Speaking in the Sri Lankan capital Colombo, Mukherjee said there were risks to an early global economic recovery and signs asset price bubbles were re-emerging.

Inflation based on the wholesale price index accelerated in October 2009 from a month earlier on costlier minerals and fuels. On Saturday, the government switched to using monthly inflation data for all commodities with 1993/94 as the base year, from the earlier practice of announcing weekly price movement. The wholesale price index was up 1.34 % in October 2009 from a year earlier, compared with 0.5 % rise in September 2009 and 11.06 % jump a year ago. Food prices, however, declined by 1 % from the previous month's level, while minerals and industrial fuels were each costlier by 3%.

At its policy review last month, the Reserve Bank of India (RBI) lifted its inflation forecast to 6.5% for the end of 2009/10 fiscal year in March, but left policy rates unchanged. The RBI also laid the groundwork for a rise in interest rates by tightening credit to the commercial property sector and removed some of the emergency liquidity support steps that were extended to protect the economy from the global downturn.

Industrial output grew 9.1% in September 2009 from a year earlier, helped by stimulus and festival demand, and adding to the debate on the timing of exit policy. The RBI forecast the economy would expand 6% in 2009/10, below 6.5 % predicted by the prime minister's economic panel. It grew 6.7% last year, slowing sharply from 9% or more between 2005/06 and 2007/08.

Meanwhile, the government aims to sell shares of about 60 state-run firms in the coming years, with offers for NTPC and Rural Electrification Corp expected by end-March 2010, disinvestment Secretary Sunil Mitra said on Friday 1 November 2009. He also said the finance ministry was in talks with other ministries to launch public offers of Steel Authority of India, miner NMDC, Coal India and telecoms firm BSNL.

The cabinet will soon consider selling part of government's stake in Steel Authority of India and NMDC, Steel Minister Virbhadra Singh told reporters on Monday.

The cabinet recently approved a long-pending divestment policy that mandates at least 10% public holding in state-run firms and use the proceeds for social schemes until March 2012, to cut its fiscal deficit.

European shares advanced for the fourth straight session on Monday, with commodity stocks leading the gainers as raw material prices benefited from a weaker US dollar, but retailer H&M fell after weak October sales. The key benchmark indices in France, Germany and UK were up by between 0.81% to 1.44%.

New passenger car registrations in Europe rose 11.2% to 1.26 million in October 2009 year-on-year, driven by growth in the Western European markets, the European Automobile Manufacturers' Association said Monday.

Asian stocks gained on Monday after upbeat reports from US retailers underpinned confidence the global economy is recovering. The key benchmark indices in Hong Kong, South Korea, Singapore and Taiwan rose by between 1.3% to 2.08%.

China's Shanghai Composite Index jumped 2.74%, aided by economic data showing foreign direct investment (FDI) into China climbed for a third straight month. FDI rose 5.7% to $7.1 billion in October 2009, after rising 18.9% on year in September 2009, the state-run Xinhua news agency reported, citing data from the Ministry of Commerce. In the first ten months of the year foreign domestic investment totaled $70.87 billion, down 12.6% from a year earlier.

Data released last week showed China's industrial production and retail sales accelerated at faster than expected pace, although consumer and producer prices were generally softer than expected

China's economy is expected to grow by about 8.5 % next year while inflation will remain modest at about 2.5 %, indicating that monetary policy should remain appropriately loose to solidify the basis of the recovery, a key government think-tank said on Monday. The State Information Centre added that the risks of rapid credit growth could be contained and that a tightening of monetary policy would have only limited effectiveness in curbing asset price bubbles, in a report carried by the official China Securities Journal.

US President Barack Obama said on Monday that Washington was not trying to contain China's rise but said trade between the two giants needed to be more balanced. Addressing students at a town hall-style meeting in Shanghai on the first full day of his first trip to China, Obama said the notion that Washington and Beijing must be adversaries was not pre-destined.

Japan's Nikkei rose 0.21%. Japan's economy expanded at the fastest pace in more than two years in the third quarter, led by a rebound in domestic demand that may ease concern of a return to recession next year. Gross domestic product rose at an annual 4.8% pace, after a 2.7% gain in the second quarter, Cabinet Office figures showed today in Tokyo.

Meanwhile, Japanese Trade Minister Masayuki Naoshima apologized for speaking about price sensitive third-quarter GDP data to oil industry executives on Monday ahead of its official release in an embarrassment for a government that took power two months ago.

Trading in US index futures indicated Dow could gain 62 points at the opening bell on Monday, 16 November 2009.

US stocks rose on Friday, setting up a second straight week of gains, as upbeat retail news reinforced hopes for strong sales in the key holiday season. The Dow Jones Industrial Average roseor 73 points or 0.71%, to close at 10,270. The Nasdaq gained about 18 points or 0.87% at 2176, and the S&P 500 was up 6.24 points or 0.57% at 1093.

Obama said on Sunday the world economy was on a path to recovery but warned that failure to re-balance the global economic system would lead to further crises. Obama was addressing Asia Pacific leaders in Singapore.

Leaders of the 21-member Asia Pacific Economic Cooperation forum pledged on Sunday to conclude Doha global trade talks in 2010 and to reject protectionism, but dropped earlier draft references to "market-oriented exchange rates" and to emissions cuts.

Kansas City Fed President Thomas Hoenig said on Monday that the US economy still faced significant weaknesses and he urged policymakers to allow large financial institutions to fail if needed. Hoenig was speaking at a central bank event in Abu Dhabi, the capital of the United Arab Emirates.

The BSE 30-share Sensex rose 183.68 points or 1.09% to 17,032.51, its highest closing since 20 October 2009. At the day's high of 17083.20, the Sensex rose 234.37 points in mid-afternoon trade. The Sensex rose 44.28 points at the day's low of 16893.11 in early trade.

The S&P CNX Nifty rose 59.10 points or 1.18% to 5058.05, its highest closing since 21 October 2009. Nifty hit a high of 5073.20. Nifty November 2009 futures were at 5,055.20, at a discount of 2.85 points as compared to spot closing of 5,058.05. Turnover in NSE's futures & options (F&O) segment was Rs 58,411.07 crore, sharply lower than Rs 72,277.97 crore on Friday, 13 November 2009.

The market breadth, indicating the overall health of the market was strong. On BSE, 1752 shares advanced as compared with 1013 that declined. A total of 90 shares remained unchanged.

From the 30 share Sensex pack; 26 rose and rest fell.

BSE clocked a turnover of Rs 4377 crore, lower than Rs 5312.04 crore on Friday, 13 November 2009.

The market has risen sharply in the past few days. From a recent low of 15,404.94 on 3 November 2009, the Sensex has jumped 1,627.57 points or 10.56% in a short period of time, at current 17,032.51 on 16 November 2009. The Sensex is up 7385.20 points or 76.55% in calendar year 2009, as on 16 November 2009. From a 3-year closing low of 8,160.40 on 9 March 2009, the Sensex is up 8872.11 points or 108.72% as on 16 November 2009.

Coming back to today's trade, the BSE Mid-Cap index rose 1.14% and the BSE Small-cap index rose 1.22%. Both the indices outperformed the Sensex.

The BSE Realty index (up 3.15%), the BSE Auto index (up 2.9%), the BSE Metal index (up 2.41%), the BSE Oil & Gas index (up 1.37%), the BSE Consumer Durables index (up 1.16%), outperformed the Sensex.

The BSE IT index (down 0.28%), the BSE Teck index (up 0.21%), the BSE Capital Goods index (up 0.69%), the BSE PSU index (up 0.7%), the BSE FMCG index (up 0.76%), the BSE Healthcare index (up 0.83%),the BSE Power index (up 0.92%), the BSE Bankex (up 0.98%), underperformed the Sensex.

Energy major Reliance Industries (RIL) rose 1.47% to Rs 2147.75. But the stock came off the day's high of Rs 2158.80. RIL may reportedly join global oil majors in search of shale gas. RIL has been studying the breakthroughs and the new technologies that are being used in producing shale gas that is now a huge rage in the US, reports suggest.

Reliance Industries (RIL) on Friday offered to withdraw affidavits filed by seven of its directors, claiming they were unaware of the contents of the memorandum of understanding (MoU) signed between members of the Ambani family in 2005 for supply of gas from the Krishna-Godavari basin, only if Reliance Natural Resources (RNRL) agreed to withdraw an assertion in its affidavit that the RIL board had seen and approved the MoU. RIL and RNRL are currently fighting the gas price dispute in the supreme court.

RIL on 10 November 2009 said reports of a meeting between the billionaire Ambani brothers to settle a gas-pricing dispute were baseless. RIL said in a statement the matter would be decided by the Supreme Court, which is currently hearing the case.

RIL on Tuesday 10 November 2009 announced its first oil discovery in its exploration block in the Cambay Basin off Gujarat. Reliance holds 100% participating interest in the block. This block was awarded to Reliance under the fifth round of the New Exploration Licensing Policy.

India's largest engineering and construction firm by sales Larsen & Toubro rose 0.43% to Rs 1650.65. But the stock came off the day's high of Rs 1669. The company made a profit of Rs 86.14 crore by paring a third of its stake in software firm Mahindra Satyam. Larsen and Toubro (L&T) on Friday, 13 November 2009 sold 2.72 crore shares in Mahindra Satyam in two bulk deals at an average price of Rs 113.65 on BSE in opening trade.

Among other capital goods stocks, Bharat Heavy Electicals, ABB, BEML, Thermax rose by between 0.12% to 1.5%.

Metal stocks rose as a gauge of six metals traded on the London Metal Exchange, rose 0.27% on Friday, 13 November 2009. Sterlite Industries rose 3.55% even on reports a Texas judge has issued final approval of Grupo Mexico's plan to regain control of copper miner Asarco, ending a lengthy takeover battle with rival suitor Sterlite Industries. The ruling will return control of Asarco to Americas Mining Corporation, a Grupo Mexico subsidiary. The deal is expected to close by mid-December

National Aluminium Company rose 1.11%. The company recently hiked the prices of aluminium products by Rs 1000 a tonne reflecting the recent uptrend in prices on the London Metal Exchange.

Hindustan Zinc and Hindalco Industries rose by between 2.6% to 2.99%.

Bur NMDC fell 0.22% after the steel minister said disinvestment process in the state-run firm will begin in the current financial year.

Steel Authority of India (Sail) rose 0.91% after the steel minister said the cabinet will soon consider selling part of government's stake in Steel Authority of Steel. Meanwhile, Sail chairman today said the company has cut flat product prices by Rs 500 per tonne

Tata Steel, the world's eighth largest steelmaker by output, rose 2.65%. The company said on Thursday 12 November 2009 it approved a new convertible bonds offer in exchange for an existing $875 million securities to reduce costs and ease repayment obligations. The company said on 6 November 2009 steel sales at its Indian operations rose 38% to 462,000 tonnes in October 2009 over October 2008.

Demand for steel remains strong from auto, rural construction and infrastructure sectors. Also demand for construction grade steel has improved post monsoon season, and has resulted into higher sales.

Rate sensitive auto stocks rose as low interest rates and attractive benefits offered by companies pushed up sales in October 2009.

India's largest small car marker by sales Maruti Suzuki India rose 5.45%. The company's total sales grew 32.4% to 85415 units in October 2009, compared with 64490 units posted in the same month a year ago.

India's largest truck marker by sales Tata Motors rose 2.32%. Its UK unit Jaguar Land Rover is reportedly expected to announce on Monday that it has secured a 170-million-pound ($282.5 million) working capital facility from GE Capital.

India's second largest bike marker by sales Bajaj Auto rose 3.57%. Carlos Ghosn, chief executive of French car maker Renault and Japan's Nissan Motor Co, said on Tuesday an agreement had been signed with Bajaj Auto for a low-cost car which would come to India in 2012.

India's largest bike marker by sales Hero Honda Motors rose 3.82%. The company reported a marginal increase in October sales at 354,156 units as against 352,449 units in the same month last year

India's largest tractor maker by sales Mahindra & Mahindra 1.79%. The company's overall sales climbed 32% in October this year to 18,410 units against 13,935 units in the same month last year.

Car sales in India rose an annual 34% to 132,615 units in October 2009, boosted by festival demand and easier availability of loans, an industry body said on Wednesday 11 November 2009. Sales of trucks and buses, a gauge of economic activity, rose 52% to 42,562 units in October 2009, the data showed.

Rate sensitive realty shares rose on bargain hunting after a recent steep fall. Omaxe, Unitech, Indiabulls real Estate, DLF, Parsvnath Developers rose by between 1.19% to 4.54%.

Ansal Properties & Infrastructure surged 9.01% after the company's board approved allotment of 96.27 lakh equity shares to Mauritius-based IPRO Funds, a foreign fund, under preferential allotment.

Realty stocks corrected recently after the RBI, late last month, raised the provisioning requirements for loans to commercial real estate from 0.4% to 1% at a regular monetary policy review. The latest RBI move will result in increase in borrowing costs for realty firms which depend heavily on borrowing. 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 in its quarterly policy review.

Banking shares rose on hopes of financial sector reforms. India's largest private sector bank by net profit ICICI Bank rose 1.04%. Its ADR rose 0.86% on Friday 13 November 2009. The bank's net profit rose 2.6% to Rs 1040.13 crore on a 12.7% decline in total income to Rs 8480.73 crore in Q2 September 2009 over Q2 September 2008. The result was announced during trading hours on 30 October 2009.

India's largest bank by net profit State Bank of India (SBI) rose 2%. State Bank of India said on 9 November 2009 said it had entered into an agreement with T. Rowe Price to sell a 6.5% holding each in UTI Asset Management Company and UTI Trustee Company. State Bank currently holds 25% in each of the companies and after the sale its holding would be reduced to 18.5%, it said in a statement.

SBI announced after market hours on Friday 6 November 2009 it has revised downwards interest rates on deposits by 25-50 basis points for a few maturities effective from 9 November 2009. The bank's consolidated net profit rose 28.29% to Rs 3,133.16 crore on 22% rise in consolidated income to Rs 33,101.65 crore in Q2 September 2009 over Q2 September 2008. The results were announced on 31 October 2009.

But, India's second largest private sector bank by net profit HDFC Bank was flat even as its ADR rose 2.82% on Friday.

India's largest dedicated home loan lender Housing Development Finance Corporation (HDFC) was flat at Rs 2760. The lender announced after market hours on Friday 13 November 2009 it has agreed to acquire approximately 41% in the fully diluted equity share capital of Credila Financial Services from DSP Merrill Lynch Capital.

Prime Minister Manmohan Singh said on Sunday, 8 November 2009, financial reforms, such as building up a domestic bond market and expanding foreign investment in sectors like insurance, would be pushed forward.

As per reports, the government plans to introduce two key bills in parliament by December 2009. It plans to introduce bills proposing the raising of foreign stake limits in insurers to 49% from the present 26% and opening up the pension sector to private and foreign firms.

Meanwhile, the Reserve Bank of India Deputy Governor Usha Thorat said on Monday the central bank will soon issue guidelines on provisioning for bad loans by banks

IT stocks fell on reports a new tax rule in the European Union (EU) will put a renewed squeeze on profit margins of companies such as Tata Consultancy Services, Infosys and Wipro. Starting 1 January 2010 the 27-nation bloc plans to impose value-added tax (VAT) on services delivered from non-EU nations such as India. A strong rupee also weighed on IT stocks.

India's second largest software company by sales Infosys fell 0.34% even as its ADR rose 2.85% on Friday. Infosys BPO, the business processing outsourcing subsidiary of Infosys Technologies, on Thursday announced the signing of a definitive agreement to acquire all of the outstanding interests of McCamish Systems LLC, a premier business process solutions provider, based in Atlanta, Georgia in the United States.

The acquisition is expected to be completed later this year subject to the satisfaction of certain closing conditions. The upfront consideration for the deal is $38 million with up to an additional $20 million payable to the sellers if McCamish Systems achieves certain financial targets in the future. The announcement was made before market hours on Thursday 12 November 2009.

India's largest software company by sales Tata Consultancy Services (TCS) fell 0.63%. The company recently secured a 150 million pounds software implementation contract for 15 years from Cardiff city council, UK.

Bur, India's third largest software company by sales Wipro rose 0.55% as its ADR rose 2.11% on Friday. Wipro, sees robust deal pipeline on the back of improving IT demand worldwide, Suresh Vaswani, joint chief executive said on Tuesday 10 November 2009. The company said on 5 November 2009 it had agreed to buy some personal care businesses of Yardley for about $45.5 million, adding to its consumer goods business. Wipro said it had signed an agreement with UK-based Lornamead group, which owns the Yardley brand, for the businesses in Asia, the Middle East, Australasia and some African markets.

Indian rupee rose on Monday, boosted by gains in regional stock markets and tracking broad weakness in the dollar. The partially convertible rupee was at 46.21/23, stronger than Friday's close of 46.31/32. A firm rupee adversely affects operating profit margins of IT firms as the sector derives a lion's share of revenue from exports.

UltraTech Cement, a unit of conglomerate Aditya Birla Group, rose 1.49%, paring gains after more than 8% jump in early trade after it absorbed sister unit Samruddhi Cement, to form the country's biggest cement firm. The move, flagged in October 2009, was approved by the boards of both companies on Sunday. In October, the group said it will hive off the cement business of flagship firm Grasim Industries into unit Samruddhi in a cashless transaction and later merge it with group firm UltraTech. Samruddhi shareholders will receive four shares of UltraTech for every seven held in Samruddhi. UltraTech will also issue 14.95 crore new shares, boosting its capital to Rs 274 crore. Shares of Grasim Industries rose 2.07%.

Among other cement stocks, ACC, Ambuja Cements and Birla Corporation rose by between 0.24% to 1.4%.

Some PSU stocks rose as Prime Minister Manmohan Singh on 5 November 2009, approved divestment in public sector companies to raise funds for social welfare. Chennai Petroleum, MTNL, Central Bank of India, Power Finance Corporation rose by between 0.3% to 2.46%.

Some construction shares rose as 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. A government panel has approved eight road projects worth Rs 10880 crore ($2.34 billion), the finance ministry said in a statement late last week. Era Infra Engineering, Valech Engineering, Jaiprakash Associates, Gayatri Projects rose by between 0.71% to 13.77%.

FMCG stocks rose on bargain hunting. ITC, Hindustan Unilever, Dabur India, Marico rose by between 0.45% to 2.19%.

Telecom stocks rose as the process for auctioning third generation (3G) radio frequencies or spectrum that is vital for telecom companies to offer high-end services such as ultra fast internet and data services on the mobile, kicks off in New Delhi today with the pre-bid conference. India's second largest mobile services provider by sales Reliance Communication rose 3.05%. As per recent reports the company is in talks with Canadian firm Iseemedia Inc to introduce low-cost e-mail services on phones.

Bharti Airtel India's top mobile operator by sales rose 0.53% The company added 27 lakh users in October 2009, taking its total subscriber base to 11.32 crore. Idea Cellular rose 2.18%.

The Cellular Operators' Association of India (COAI) said last week its members added 1.02 crore users to their GSM networks in October, taking their total subscribers to 35.52 crore.

During the meet, officials from the communication ministry will seek to clarify as well as address all queries regarding the 3G and WiMAX auctions which are scheduled to begin in mid-January 2010, reports suggest

India's largest thermal power producer by sales NTPC fell 0.16%. A 5% stake sale in state-run power producer could fetch the government Rs 8100 crore ($1.7 billion), Sunil Mitra, a senior finance ministry official, said on Friday 13 November 2009.

Last month, the cabinet approved share sales for NTPC, Satluj Jal Vidyut Nigam and Rural Electrification Corp. Mitra said. Rural Electrification Corporation rose 5.54%.

But among other power stocks, Torrent Power, Reliance Infrastructure Reliance Power and GVK Power & Infrastructure rose by between 0.34% to 5.33%.

Cals Refineries clocked highest volume of 2.32 crore shares on BSE. Suzlon Energy (2.18 crore shares), Mahindra Satyam (0.84 crore shares), SpiceJet (0.77 crore shares) and Unitech (0.67 crore shares) were the other volume toppers in that order.

Suzlon Energy clocked the highest turnover of Rs 157.20 crore on BSE. State Bank of India (Rs 117.19 crore), Reliance Industries (Rs 111.90 crore), DLF (Rs 107 crore) and Tata Steel (Rs 104.85 crore) were the other turnover toppers in that order.