Sensex attains 1-1/2-week closing high

Key benchmark indices edged higher as European stocks rose on relief over weekend regional elections in Spain and as trading in US index futures indicated recovery in US stocks at the opening bell on Monday, 22 October 2012, after Friday's sharp losses. The barometer index, BSE Sensex, reached 1-1/2-week closing high. The Sensex jumped 111.13 points or 0.59%, up about 190 points from the day's low and of close to 15 points from the day's high. Index heavyweight Reliance Industries (RIL) edged higher. Engineering & construction major L&T hit 52-week high after reporting good Q2 results. The market breadth was negative. The Sensex has risen 30.70 points or 0.16% in October 2012 so far (till 22 October 2012). The Sensex has surged 3,338.52 points or 21.6% in calendar 2012 so far (till 22 October 2012). From a 52-week high of 19,137.29 on 5 October 2012, the Sensex has declined 343.85 points or 1.79%. From a 52-week low of 15,135.86 on 20 December 2011, the Sensex has risen 3,657.58 points or 24.16%. Coming back to today's trade, index heavyweight and cigarette maker ITC edged lower after the Ministry of Health and Family Welfare during market hours today, 22 October 2012, said it has notified new pictorial health warnings to be depicted on tobacco product packs which will come into effect from 1 April 2013. IT stocks rose after TCS' strong Q2 results. HCL Technologies hit 52-week high. HDFC declined profit taking as the company's Q2 September 2012 results came in line with market expectations. HDFC Bank hit record high. Bank of Baroda dropped as state-run bank's non-performing assets (NPA) rose in Q2 September 2012. Motorcycle major Bajaj Auto gained after the company reported a sequential improvement in its operating EBITDA in Q2 September 2012. UltraTech Cement rose on strong Q2 results. United Spirits rose on renewed buying. The market edged lower in early trade on weak Asian stocks. Key benchmark indices trimmed initial losses in morning trade as Hong Kong's Hang Seng index reversed intraday losses. The Sensex moved into positive zone from negative zone in morning trade. The market extended gains to hit fresh intraday high in early afternoon trade. Key benchmark extended intraday gains to hit fresh intraday highs in mid-afternoon trade. The market remained firm in late trade. Foreign institutional investors (FIIs) bought shares worth a net Rs 125.20 crore from the secondary equity markets on Friday, 19 October 2012, as per data from Securities & Exchange Board of India. The market may remain volatile this week as traders roll over positions in the futures & options (F&O) segment from the near month October 2012 series to November 2012 series. The near-month October 2012 derivatives expire on Thursday, 25 October 2012. The stock market remains closed on Wednesday, 24 October 2012, on account of Dussera. The BSE Sensex jumped 111.13 points or 0.59% to settle at 18,793.44, its highest level since 11 October 2012. The index jumped 126.97 points at the day's high of 18,809.28 in late trade. The index declined 81.43 points at the day's low of 18,600.88 in early trade, its lowest level since 18 October 2012. The S&P CNX Nifty advanced 32.90 points or 0.58% to 5,717.15, its highest closing level since 18 October 2012. The index hit a high of 5,721.55 in intraday trade. The index hit a low of 5,658.05 in intraday trade, its lowest level since 18 October 2012. The BSE Mid-Cap index shed 0.1%. The BSE Small-Cap index gained 0.31%. Both these indices underperformed the Sensex. The total turnover on BSE amounted to Rs 1804 crore, lower than Rs 2181 crore on Friday, 19 October 2012. The market breadth, indicating the overall health of the market, was negative. On BSE, 1,446 shares fell and 1,405 shares rose. A total of 125 shares were unchanged. From the 30-share Sensex pack, 20 stocks rose while the rest of them fell. Index heavyweight and cigarette maker ITC declined 1.24% to Rs 293.80 after the Ministry of Health and Family Welfare during market hours today, 22 October 2012, said it has notified new pictorial health warnings to be depicted on tobacco product packs which will come into effect from 1 April 2013. Three sets of warnings each have been notified for smoking as well as smokeless forms of tobacco product packages. The Ministry of Health and Family Welfare said in a statement that well-designed health warnings and messages are part of a range of measures to communicate health risks due to tobacco use. Pictorial health warnings communicate health risks in a visible way, provoke a greater emotional response and increase the motivation of tobacco users to quit and to decrease their tobacco consumption, the ministry's statement said. Graphic warning labels have a greater impact than text-only labels and can be recognized by low-literacy audiences and children, the statement added. Shares of ITC had hit record high on Friday, 19 October 2012, after the company announced strong Q2 results during trading hours on that day. The stock had hit record high of Rs 299.20 in intraday trade on Friday, 19 October 2012. ITC's net profit after net profit jumped 21.27% to Rs 1836.42 crore on 18.65% growth in income from operations to Rs 7226.58 crore in Q2 September 2012 over Q2 September 2011. Index heavyweight Reliance Industries (RIL) rose 1.48% to Rs 814.65, off the day's low of Rs 792.60. RIL's net profit declined 5.7% to Rs 5376 crore on 15.4% growth in turnover to Rs 93265 crore in Q2 September 2012 over Q2 September 2011. RIL's gross refining margin (GRM) which is the differential between the cost of a barrel of crude oil and realization from sale of refined products produced from it declined to $9.5 a barrel in Q2 September 2012 from $10.1 a barrel in Q2 September 2011. RIL's net profit jumped 20.2% to Rs 5376 crore on 1.7% decline in turnover to Rs 93265 crore in Q2 September 2012 over Q1 June 2012. The GRM surged to $9.5 a barrel in Q2 September 2012 from $7.6 a barrel in Q1 June 2012. RIL announced the second quarter results last week. United Spirits rose 1.96%. In a joint press release issued by United Spirits and Diageo plc late last month, Diageo plc had confirmed that it is in discussion with United Spirits and United Breweries (Holdings) in respect of possible transactions for Diageo plc to acquire an interest in United Spirits. However, there is no certainty that these discussions will lead to a transaction, the press release had stated. Mahindra & Mahindra (M&M) rose 1.34%. The company last week announced the launch of high-end sports utility vehicle SsangYong Rexton. Designed and developed by SsangYong in Korea, this is the third generation Rexton, most suitable for the discerning Indian customer, M&M said in a statement on 17 October 2012. SsangYong Rexton is priced at Rs 17.67 lakh ex-showroom Mumbai for the RX5 version with manual transmission and Rs 19.67 lakh ex-showroom Mumbai for the RX7 version with automatic transmission. The SsangYong Rexton is manufactured and assembled at M&M's Chakan plant near Pune by sourcing components from SsangYong Korea and from India. India's largest car maker by sales Maruti Suzuki India rose 0.06%. The car major last week launched an upgraded model of its popular Alto car. Maruti Suzuki on 16 October 2012 said the new Alto 800 is over 15% more fuel efficient than the current Alto model. Maruti Suzuki along with its vendors have invested over Rs 470 crore towards developing the Alto 800, the company said. Alto 800 will be manufactured at Maruti's state-of-the-art Gurgaon facility and will be available in 3 petrol variants and 3 factory fitted CNG variants. Additionally, driver airbag will be available as an optional feature. The introductory price for Alto 800 ranges between Rs 2.44 lakh and Rs 2.99 lakh ex-showroom Delhi for 3 variants in petrol segment. The introductory price for 3 variants in CNG segment ranges between Rs 3.19 lakh and Rs 3.56 lakh ex-showroom Delhi, Maruti said. India's largest commercial vehicle maker by sales Tata Motors dropped 0.86%. The company's global sales declined 4% to 1.03 lakh units in September 2012 over September 2011. Global wholesales of all passenger vehicles declined 11% to 48,895 units in September 2012 over September 2011. Global wholesales of Tata passenger vehicles declined 17% to 22,434 units in September 2012 over September 2011. Global wholesales of Jaguar Land Rover in September 2012 were at 26,461 vehicles, lower by 4% over September 2011, which includes model year change over timings, Tata Motors said last week. Global wholesales of all commercial vehicles -- Tata, Tata Daewoo and the Tata Hispano Carrocera range -- were 54,761 units in September 2012, higher by 3%, over September 2011, Tata Motors said. Motorcycle major Bajaj Auto rose 0.73% after company on Saturday, 20 October 2012, said its profit after tax rose 2% to Rs 741 crore on 4% decline in turnover to Rs 5139 crore in Q2 September 2012 over Q2 September 2011. Operating EBITDA declined 6% to Rs 992 crore in Q2 September 2012 over Q2 September 2011. Operating EBITDA margin declined to 19.7% in Q2 September 2012 from 20.1% in Q2 September 2011. The operating EBITDA margin improved to 19.7% in Q2 September 2012 from 19.4% in Q1 June 2012. Bajaj Auto had cash and cash equivalents of Rs 4521 crore as on 30 September 2012, lower than Rs 5682 crore as on 30 June 2012. The reduction in cash was mainly due to payment of annual dividend to shareholders in July 2012. Bajaj Auto said Q2 September 2012 was a challenging quarter for the industry at large. The motorcycle industry which witnessed a CAGR growth of 15% over last 4 years, witnessed a decline of about 9% in Q2 September 2012. Added to this was the overall inflationary pressures, rise in input cost and depreciating rupee forcing the government to increase fuel prices. In this environment, the company's performance has been more than satisfying, Baja Auto said in a statement. Bajaj Auto said that the company's strategy to focus on the high end motorcycle segment of the market together with its variable cost structure ensured that in a subdued market there was no negative impact on operating leverage. Bajaj Auto launched Pulsar 200 NS and Discover ST motorcycles pan-India in Q2 September 2012. Both the products have received an over-whelming response, Bajaj Auto said. In September 2012, Discover became the largest selling motorcycle brand in the country, having dislodged Splendor from the coveted spot. With the success of new launches, Bajaj Auto increased its share in domestic motorcycle market to 27% in September 2012 from 23% in April 2012. With regard to motorcycle exports, Bajaj Auto said that the African region continues to do well. In other markets, in-line with overall global slowdown, demand remained subdued. In Sri Lanka, as against an average sale of 12,000 motorcycles per month, the company's current sales are at about 6,500 units per month. The company's overall market share in motorcycles across the world stood at about 33% in Q2 September 2012. With regard to three-wheeler sales in the domestic market, Bajaj Auto said that the company has performed better than the industry on the back of the success of the recently launched diesel variants. Bajaj Auto said it continues to dominate the gasoline and alternate fuel passenger segment. With the opening of new permits, the outlook for three-wheeler sales in coming quarters in the domestic market is encouraging, Bajaj Auto said. As regards three-wheeler exports, with price rationalization in Sri Lanka, average sales have recovered to about 7,500 units per month. The loss on sales in Sri Lanka is being partially off-set with gains in Egypt, Bajaj Auto said. The country's largest two-wheeler maker by sales Hero MotoCorp fell 1.01% ahead of its Q2 results tomorrow, 23 October 2012. The company's total sales declined 26.35% to 4.04 lakh units in September 2012 over September 2011. Bank stocks were mixed. Axis Bank extended recent rally triggered by the private sector bank reporting strong Q2 results. The stock was up 1.76%. Axis Bank's net profit rose 22.1% to Rs 1123.54 crore on 27.2% growth in total income to Rs 8280.29 crore in Q2 September 2012 over Q2 September 2011. Axis Bank's fee income jumped 20% to Rs 1343 crore in Q2 September 2012 over Q2 September 2011. The main business segments driving fee growth during the quarter were retail banking, which grew 43% year-on-year (YoY) and large and mid-corporate banking which grew 15% YoY, Axis Bank said. SME and agricultural banking fees grew 17% YoY in the quarter, the bank said. Trading profits of the bank were Rs 207 crore in Q2 September 2012. Axis Bank's provisions and contingencies jumped 26% to Rs 509.42 crore in Q2 September 2012 over Q2 September 2011. The bank's Capital Adequacy Ratio (CAR) stood at 12.99% as on 30 September 2012, lower than 13.03% as on 30 June 2012 but higher than 11.35% as on 30 September 2011. Axis Bank's management at a conference call held on 16 October 12 after the second quarter results said that the bank proposes to continue focus on low cost deposits and plans to improve the share of retail term deposits in total deposits base and reduce share of wholesale deposits. The bank also expects the cost of funds to come down with easing deposit rates. The management expects the bank's gross NPA to remain in the range of 1% to 1.2% and sees net NPA to be capped at 0.5%. Axis Bank's ratio of gross non-performing assets (NPA) to gross advances stood at 1.1% as on 30 September 2012, higher than 1.06% as on 30 June 2012 and 1.08% as on 30 September 2011. The ratio of net NPA to net advances stood at 0.33% as on 30 September 2012, higher than 0.31% as on 30 June 2012 but lower than 0.34% as on 30 September 2011. Axis Bank restructured Rs 323 crore of assets in Q2 September 2012, taking the outstanding restructured book higher to Rs 4068 crore and accounting for 2.36% of advances book at end September 2012. The increase in outstanding restructured book was driven by surge in large and mid-corporate restructured book by Rs 247 crore to Rs 3309 crore. However, the size of agri (including micro-finance) restructured book declined to Rs 250 crore at end September 2012 from Rs 268 crore at end June 2012. The management expects retail business to support the bank's credit growth. The share of retail loan book in total loan book of the bank has continued to increase and touched 25.7% at end September 2012. The bank proposes to further increase the retail loan book size to 28-29% in next two years by focusing on agri and SME lending. Axis Bank's CASA ratio improved slightly to 40.5% at end September 2012, snapping continuous moderation for previous four sequential quarters. India's second largest private sector bank by net profit HDFC Bank gained 1.73% to Rs 639.15. The stock hit a record high of Rs 639.90 in intraday trade today, 22 October 2012. The bank's net profit jumped 30.06% to Rs 1559.98 crore on 24.47% growth in total income to Rs 9869.8 crore in Q2 September 2012 over Q2 September 2011. HDFC Bank announced the second quarter results during trading hours on 12 October 2012. ICICI Bank rose 1.69%. ICICI Bank has cut its floating rate on new home loans by up to 100 basis points until December end, the country's second-largest lender said on 11 October 2012. For loans up to Rs 30 lakh, the bank will charge 10.25% interest, ICICI Bank said. It earlier used to charge 10.5% for loans up to Rs 30 lakh. The interest rate for loans between Rs 30 lakh and Rs 3 crore will be 10.5%, down from 11.5%, the bank said, adding the new rates are applicable only for the festive period that starts in October and ends in December. ICICI Bank on 16 October 2012 denied media reports that it is in acquisition talks with Karnataka Bank. ICICI Bank said it is currently not considering merger or acquisition of any bank. India's largest bank by branch network State Bank of India (SBI) shed 0.65%. Bank of Baroda dropped 1.74% as the state-run bank's ratio of gross non-performing assets (NPA) to gross advances edged up to 1.98% as at end September 2012 from 1.84% as on 30 June 2012 and 1.41% as on 30 September 2011. The ratio of net NPA to net advances edged up to 0.82% from 0.65% as on 30 June 2012 and 0.47% as on 30 September 2011. The ratio of gross NPA stood at of gross advances as on 30 September 2012. The bank's net profit rose 11.6% to Rs 1301.39 crore on 19.59% growth in total income to Rs 9550.86 crore in Q2 September 2012 over Q2 September 2011. The bank announced the results during trading hours today, 20 October 2012. Bank of Baroda's provisions and contingencies jumped 33.7% to Rs 646.41 crore in Q2 September 2012 over Q2 September 2011. Non performing loan provisioning coverage ratio (including technical write off) was at 75.72% as on 30 September 2012. The bank's Capital Adequacy Ratio (CAR) as per Basel II norms stood at 12.91% as on 30 September 2012, lower than 13.74% as on 30 June 2012 and higher than 12.73% as on 30 September 2011. PSU OMCs gained as US crude oil futures fell 2% to settle at $90.05 a barrel on Friday, 19 October 2012, the lowest close since 8 October 2012. BPCL and HPCL gained by between 0.1% to 0.9%. But, Indian Oil Corporation (IOCL) fell 0.1%. Lower crude oil prices could reduce under-recoveries of state-run oil marketing companies (PSU OMCs) on domestic sale of diesel, LPG and kerosene at controlled prices. The government has already freed pricing of petrol. Tata Global Beverages rose 1.14%. The company's equal joint venture with US coffee chain Starbucks Coffee Company, Tata Starbucks, last week opened its first Starbucks store in India. This flagship store is located at Elphinstone Building, Horniman Circle, Mumbai. Tata Starbucks will launch two more stores this week, one each at Oberoi Mall and the Taj Mahal Palace Annexe in Mumbai. Many pharma stocks rose on renewed buying. Cipla, Ranbaxy Laboratories and Sun Pharmaceutical Industries rose by between 0.64% to 1.48%. Dr Reddy's Laboratories (DRL) rose 1.2%. DRL said before trading hours today, 22 October 2012, that the company along with its subsidiaries announces the intended public offer to acquire the issued and outstanding shares of OctoPlus N.V., a service based specialty pharmaceutical company, for an offer price of euro 27.39 million in cash, representing 100% of issued and outstanding ordinary shares. The offer price represents a premium of 30% over the closing price of OctoPlus on 19 October 2012, DRL said. DRL currently holds and irrevocable commitment from shareholders representing over 50% of OctoPlus's issued and outstanding shares. Further, the Executive Board and the Supervisory Board of OctoPlus have unanimously recommended DRL's offer to the remaining shareholders of OctoPlus, DRL said. DRL said the acquisition of OctoPlus will expand DRL's expertise and scientific capabilities. G V Prasad, Vice Chairman and CEO, DRL said: "As we globalize our R&D efforts, we are looking forward to build a research base in Netherlands. The acquisition helps us ramp up our technology capabilities in drug discovery". Assuming that the requisite number of shares are tendered by the balance shareholders, the transaction is expected to be concluded by the end of the current fiscal year, DRL said in a statement. Wockhardt was locked at 5% upper circuit at Rs 1502.25 on BSE, which is a record high for the counter. Lupin fell 0.26% ahead of its Q2 results tomorrow, 23 October 2012. Most metal shares fell as LMEX, a gauge of six metals traded on the London Metal Exchange, dropped 2.37% on Friday, 19 October 2012. Hindustan Zinc, Bhushan Steel and Sail shed by between 0.26% to 0.95%. Sterlite Industries declined 1.15% ahead of its Q2 results tomorrow, 23 October 2012. Jindal Steel & Power fell 1.68%. The company today, 22 October 2012, said that Rahul Mehra, an independent director of the company resigned from directorship of the company with effect from 4 October 2012. Tata Steel, JSW Steel and Hindalco Industries rose by between 0.18% to 2.14%. Kingfisher Airlines was locked at 5% lower circuit at Rs 10.90 on BSE. The Director General Civil Aviation (DGCA) has suspended the Scheduled Operator's Permit of Kingfisher Airlines. The permit has been suspended with effect from 20 October 2012 till such time Kingfisher Airlines submits a concrete and reliable revival plan ensuring safe, reliable, efficient and sustainable Scheduled Air Transport Services to the satisfaction of DGCA, the Ministry of Civil Aviation said in a statement on Saturday, 20 October 2012. The DGCA decided to suspend the airline's permit after examining the airline's reply received on 19 October 2012 to the show cause notice served by DGCA dated 5 October 2012 which was not found satisfactory, it said. DGCA has observed that Kingfisher Airlines has not addressed any of the issues raised by the DGCA during a meeting held with the airline on 2 October 2012 and the points raised in the show cause notice. DGCA had asked Kingfisher Airlines to submit operational preparedness plan for resumption of its flight operations. Instead, Kingfisher Airlines has sought more time to file a reply to the show cause notice and it has also not indicated any time frame for submitting the detailed response, the Ministry of Civil Aviation said. Reacting to the suspension of the license, Kingfisher Airlines said: "While this order of DGCA is being examined, we would like to bring to your notice that the actual position has not changed because of this order. We have in any case always maintained that once the issues with the employees are resolved, we will first present our resumption plan to DGCA for review, before resuming operations. Notwithstanding the order of the DGCA, we had in any case suspended operations and closed forward bookings till 6 November 2012. The management has already earlier communicated to all stakeholders this very position. We are now immediately suspending all forward bookings till such time we resume operations. It is our endeavour to re-start operations at the earliest and we assure you we are working towards achieving this". Shares of rival airlines gained on expectation of increase in business following suspension of Kingfisher's license. Jet Airways (India) and SpiceJet rose by between 1.45% to 1.9%. L&T Finance Holdings (LTFH) dropped 0.09%. The company today, 22 October 2012, said it has entered into definitive agreements with France's Société Générale Consumer Finance on Friday, 19 October 2012, for the acquisition of 100% of FamilyCredit (FCL), a well established NBFC with presence across two-wheeler and auto financing. The consideration to be paid to complete the acquisition is about Rs 120 crore, LTFH said. The conclusion of the transaction is subject to receipt of appropriate regulatory approvals and to customary closing conditions. The acquisition will consolidate LTFH's presence in auto financing business in India. As of 30 June 2012, FCL had loan book size of about Rs 1287 crore, of which two-wheeler financing constituted 53% and car financing 35%. It has 53 branches across 16 states in India and presence in more than 1,400 dealer outlets with a sizeable customer base in excess of 4 lakh. It also has a fully staffed professional team with hands-on experience in the two wheeler financing and auto financing business. FCL has been showing consistent improvement in its operations. For the quarter ended 30 June 2012, FCL's PAT was about Rs 5 crore, backed by impressive NIM of about 13.6%. LTFH has plans to further improve the operating performance of FCL by exploiting its reach through branches and OEM relationships, and other operating synergies. Speaking on the occasion, Mr. Y. M. Deosthalee, Chairman & Managing Director of LTFH, said, "FamilyCredit is a significant player in the two-wheeler financing segment. The company offers a well established platform with robust credit and risk management systems. The business synergises well with our existing retail financing business and provides opportunity for us to further expand our product offering in the consumer finance domain." Cairn India rose 1.26% ahead of its Q2 results today, 22 October 2012. Shares of state-run coal miner Coal India rose 0.96%. The Ministry of Coal after trading hours on Friday, 19 October 2012, said total coal production in the country has registered record increase during the last two quarters. Coal off-take has also recorded significant growth during this period while coal supply to power sector during April to Oct 2012 has increased by 12%, the Ministry of Coal said in a statement. With these efforts, Coal India would be able to achieve highest ever production target during this year, the Ministry of Coal said. Coal India has a target to produce 464 million tonnes (MTs) of coal in 2012-13. It has already produced 208.3 million tonnes of coal from 1 April to 15 October 2012, thereby registering a growth of 9% as compared to same period of 2011-12. Minister of Coal Sriprakash Jaisawal while addressing a press conference on issues in coal sector, said that the government has identified 54 coal blocks with total geographical reserves of about 18.22 billion tonnes for taking up bidding of coal blocks. He said the government has taken several other steps to ensure increased availability of coal in the country. Coal India (CIL) envisages quantum growth in production during 12th five-year plan period FY 2013 to FY 2017 from potential upcoming coalfields of North Karanpura in Central Coalfields, Mand-Raigad coalfields in South Eastern Coalfields and IB Valley Coalfields of Mahanadi Coalfields, the Ministry of Coal said. However, the possibility of enhancing the coal production in the future depends largely upon timely construction of railway projects for coal evacuation. The Ministry of Coal and CIL have taken up intensive monitoring to expedite the completion of the projects in time. It is expected that power utilities will sign fuel supply agreement (FSA) with CIL by the end of November 2012. CIL is ready to sign FSAs with 80% trigger level, the Ministry of Coal said. This would comprise of 15% imported coal on cost plus model for this year. The imported coal would be supplied on cost plus basis only on confirmed commitments from the consumers. Here it is pertinent to mention that the issues relating to FSA have been deliberated upon and resolved, the Ministry of Coal said. The Ministry of Coal said that inter ministerial group (IMG) has already reviewed coal blocks given to the private companies. For government companies, IMG has completed the hearings and will further examine the matter on 30 and 31 October 2012, the Ministry of Coal said. As regards setting up of a coal regulator, the Ministry of Coal said that the matter is under consideration of GoM. A draft revised bill will be placed before the next meeting of the GoM. UltraTech Cement rose 0.67% after the company on Saturday, 20 October 2012, said its profit after tax jumped 97.13% to Rs 550 crore on 20.26% growth net sales to Rs 4700 crore in Q2 September 2012 over Q2 September 2011. Profit before interest, depreciation and tax jumped 57.3% to Rs 1076 crore in Q2 September 2012 over Q2 September 2011. UltraTech Cement said its variable cost rose 8% in Q2 September 2012. This was mainly on account of higher raw material prices which are linked to the last increase in railway freight and increase in diesel prices. The benefit of softening in prices of imported coal was partly offset by the depreciation of rupee against the dollar, the cement major said in a statement. Extensive measures for cost improvement and logistics optimization taken by the company helps in curbing costs to some extent, UltraTech Cement said. The company's initiative towards setting up of additional clinkerisation plants at Chhattisgarh and Karnataka are progressing on schedule. These are expected to be operational from early FY 2014 (year ending 31 March 2014). The expansion projects will raise the company's cement capacity by 10.2 million tones per annum, UltraTech Cement said. With regard to future business outlook, UltraTech Cement said that cement demand in India is likely to grow at over 8% due to the government's focus on infrastructure development. The company also said cement glut is expected to continue in India for the next three years. L&T rose 2.19% to Rs 1668.50 after good Q2 results. The stock hit a 52-week high of Rs 1674.20 in intraday trade today, 22 October 2012. The company today, 22 October 2012, said its recurring profit after tax (PAT) rose 15% to Rs 915 crore on 17% growth in gross revenue to Rs 13328 crore in Q2 September 2012 over Q2 September 2011. After considering certain exceptional and extra-ordinary items of income, the overall PAT jumped 42% to Rs 1137 crore in Q2 September 2012 over Q2 September 2011. L&T announced the second quarter results during trading hours today, 22 October 2012. L&T said order inflow at Rs 20967 crore in Q2 September 2012 recorded an impressive year-on-year growth 30%, thus sustaining the momentum seen during Q1 June 2012. The major orders came from buildings & factories, infrastructure and hydrocarbon sectors, L&T said. L&T's order book stood healthy at Rs 158528 crore as on 30 September 2012. International orders constituted 12% of the total order book. L&T said that uncertainty prevailing around the revival of growth in the global economies and the slow pace of reforms in India, have led to deceleration in growth across the sectors. Inflation continues to remain elevated exerting pressure on operating margins, L&T said. The rebounding of industrial production and improved credit demand was seen in many sectors towards the end of Q2 September 2012. A few steps takes by the Indian government recently underscore its commitment for accelerating the pace of economic development which provides positive signals for the prospects of the company, L&T said in a statement. L&T said that the company has been sustaining its growth momentum on the back of its strong and diversified business portfolio and increasing international presence. With its execution efficiencies and robust order book, the company is placed well to realize its near term targets and medium term plans, L&T said. HDFC declined profit taking as the company's Q2 September 2012 results came in line with market expectations. The stock shed 0.31% to Rs 749.75. The company's net profit rose 18.58% to Rs 1151.12 crore on 26.57% growth in total income to Rs 5277.2 crore in Q2 September 2012 over Q2 September 2011. As of 30 September 2012, HDFC's loan book stood at Rs 155128 crore as against Rs 126992 crore in the previous year. This is after considering the loans sold during the preceding 12 months amounting to Rs 5630 crore, HDFC said. HDFC's consolidated net profit rose 18.56% to Rs 1574.90 crore 81.51% growth in total income to Rs 10462.08 crore in Q2 September 2012 over Q2 September 2011. IT stocks rose after TCS' strong Q2 results. IT major TCS advanced 2.26% after the company after trading hours on Friday, 19 October 2012, said its consolidated net profit rose 3.5% to Rs 3434 crore on 5.1% growth in revenue to Rs 15621 crore in Q2 September 2012 over Q1 June 2012. The core operating profit margin (OPM) declined to 28.4% in Q2 September 2012 from 29.1% in Q1 June 2012. TCS' consolidated net profit as per International Financial Reporting Standards (IFRS) rose 7.1% to Rs 3512 crore on 5.1% growth in revenue to Rs 15621 crore in Q2 September 2012 over Q1 June 2012. Operating income rose 2.2% to Rs 4179 crore in Q2 September 2012 over Q1 June 2012. In dollar terms, consolidated net profit as per International Financial Reporting Standards (IFRS) rose 6.4% to $643 million on 4.6% growth in revenue to $2.85 billion in Q2 September 2012 over Q1 June 2012. Operating income rose 1.7% to $763 million in Q2 September 2012 over Q1 June 2012. TCS said growth in Q2 September 2012 was quite broad-based and seen across all industry segments led by Manufacturing, Retail, Telecom and BFSI. There was balanced growth across all service lines with new services like infrastructure growing in double digits, TCS said. Geography wise, all markets grew with major markets led by UK and Europe, TCS said. Growth markets like India, APAC, Latin America and Middle East performed well, TCS said. The company added 41 new clients in Q2 September 2012. Commenting on the Q2 performance, TCS Chief Executive Officer and Managing Director, N Chandrasekaran said: "We have delivered a strong performance with well-rounded growth across industries and geographies. Our execution excellence is winning recognition and our service offerings remain relevant for customers. As the global operating environment continues to evolve, there is little doubt that technology is playing a more pivotal role to shape the future of every industry than ever before. Our investments and capabilities make TCS extremely relevant to participate in imagining and co-creating this future with our customers." S. Mahalingam, Chief Financial Officer and Executive Director, TCS, said: "In the current operating context, it is important for us to remain efficient, keep a healthy grip on expenses, conserve cash and at the same time invest for the future. In this quarter, TCS has posted a credible margin performance at the operating level and we have also expanded our net margins by managing the ongoing currency volatility. We will continue to focus on maintaining our strategy of profitable growth to maintain margins to ensure we can invest on an ongoing basis as technology adoption cycles continue to get shorter." TCS also announced that Rajesh Gopinathan, vice president, business finance will take over as the next Chief Financial Officer of the company when S Mahalingam retires on 9 February 2013. TCS has appointed Mr. Gopinathan as Deputy CFO with effect from 19 October 2012. TCS said Mr. Gopinathan has been with the company since 2001 when he joined from the Tata Strategic Management Group (TSMG). He currently heads the Business Finance function responsible for financial management of the company's operating units. He has held several positions in finance, strategy and sales during his career with the company and worked in multiple geographies. He is an MBA from IIM, Ahmedabad and an engineer from REC (Trichy). TCS said the employee utilization rate (excluding trainees) was at 81.6% and including trainees was at 72.8%. The attrition rate (LTM) fell further to 11.4% overall including IT and BPO. The company said the attrition rate was the lowest in the last 10 quarters. TCS Executive vice president and Global Head, Human Resources Ajoy Mukherjee said “We are delighted to have increased our retention rate further to 88.6%. We have also been able to increase our utlisation rate including trainees despite adding over 10,000 fresh graduates during the quarter.” HCL Technologies rose 1.18% to Rs 610.60. The stock hit a 52-week high of Rs 613.85 in intraday trade today, 22 October 2012. HCL Technologies on 17 October 2012 said its consolidated net profit as per US accounting standards rose 3.9% to $161.8 million on 3.2% growth in revenue to $1.113 billion in Q1 September 2012 over Q4 June 2012. The company said its earnings before interest, taxation, depreciation and amortization (EBITDA) rose 4.1% to $247 million Q1 September 2012 over Q4 June 2012. EBITDA margin edged up to 22.2% in Q1 September 2012 from 22% in Q4 June 2012. India's second largest software services exporter by revenues Infosys rose 0.26%. The company announced after market hours today, 22 October 2012, it has completed the acquisition of Lodestone Holding AG, a leading management consultancy based in Switzerland. The acquisition is in accordance with the terms set out in the agreement announced on September 10, 2012. The deal strengthens the management consulting capabilities of Infosys around the world, adding more than 750 experienced consultants and 200 clients in wide-ranging areas such as manufacturing and the automotive and life sciences industries, Infosys said in a statement. Commenting of the conclusion of the acquisition, Infosys CEO & Managing Director, Mr. S.D. Shibulal said: "Our clients are looking for help driving the transformations that will allow them to be successful in a challenging and dynamic market. Combining our global scale with Lodestone's consulting heritage creates a world-class team that can bring clients a broad spectrum of capabilities across consulting, systems integration, and outsourcing." Infosys has cut both revenue and earnings guidance in rupee terms for FY 2013 following appreciation of the rupee against the dollar. Infosys has now forecast 17.3% growth in revenue to at least Rs 39582 crore for FY 2013, which is lower than its July guidance of 19.7% growth to at least Rs 40364 crore. The company has now forecast 10.3% growth in earnings per share (EPS) to at least Rs 160.61 for FY 2013, which is lower than its July guidance of 14.4% growth in EPS to at least Rs 166.46. Infosys announced Q2 results on 12 October 2012. Infosys has retained its revenue growth guidance for the year ending 31 March 2013 (FY 2013) in dollar terms while lowering the guidance on earnings per American depository receipt (EPADS) to give effect to prevailing exchange rates. Infosys has retained its forecast of 5% growth in revenue to at least $7.343 billion for FY 2013. The company has reduced the guidance on FY 2013 EPADS to $2.97 from the guidance of $3.03 which the company had given on 12 July 2012 at the time of announcement of Q1 June 2012 results. Infosys' consolidated net profit as per International Financial Reporting Standards (IFRS) rose 3.49% to Rs 2369 crore on 2.51% growth in revenue to Rs 9859 crore in Q2 September 2012 over Q1 June 2012. India's third largest software services exporter by revenues Wipro fell 0.41%, with the stock reversing initial gains. The focus of the stock market is currently on the second quarter earnings. Investors and analysts will closely watch the management commentary that would accompany the results which could cause revision in their future earnings forecast of the company for the current year or the next year. Hero MotoCorp, Sterlite Industries (India) and Lupin unveil Q2 results tomorrow, 23 October 2012. Mahindra & Mahindra, Kotak Mahindra Bank and Asian Paints unveil Q2 results on Thursday, 25 October 2012. Hindustan Unilever, ICICI Bank, NTPC, Sesa Goa, GAIL (India), Punjab National Bank and IDFC unveil Q2 September 2012 results on Friday, 26 October 2012. Bharat Heavy Electricals (Bhel) announces Q2 results on 29 October 2012. Maruti Suzuki India, Grasim Industries and Dr. Reddy's Laboratories unveil their Q2 results on 30 October 2012. Power Grid Corporation of India announces Q2 September 2012 results on 31 October 2012. Wipro announces Q2 results on 2 November 2012. Tata Power and Hindalco Industries unveil Q2 results on 6 November 2012. Sun Pharmaceuticals Industries announces Q2 September 2012 results on 8 November 2012. Ranbaxy Laboratories unveils Q3 September 2012 results on the same day. BPCL and ONGC announce Q2 results on 9 November 2012. India's bourses are working with the country's stock-market regulator to prevent a recurrence of the "flash crash" this month, National Stock Exchange (NSE) Chief Executive Ravi Narain said in an interview to international daily newspaper on 14 October 2012. Erroneous orders placed by a single brokerage firm on 5 October 2012 sent the NSE's main index, the 50-unit S&P CNX Nifty, falling a massive 899.40 points or 15.5% in just a few seconds. Although most of the stocks recovered soon after a 15-minute trading halt, the incident created panic among traders, highlighting concerns that high-speed traders have brought instability to the markets. On the macro front, data released last week showed that inflation based on the wholesale price index (WPI) rose to the highest level in 10 months in September 2012, limiting the central bank's ability to cut rates to help support the slowing economy. WPI inflation edged up to 7.81% in September 2012 from 7.55% in August 2012 due to a steep hike in diesel price in mid-September 2012. The core inflation, which is manufactured products inflation excluding food products, remained steady at 5.57% in September 2012. The Reserve Bank of India (RBI) announces Second Quarter Review of Monetary Policy - 2012-13 on 30 October 2012. The RBI left interest rates unchanged at its last policy meeting on 17 September 2012 citing sticky inflation. RBI Deputy Governor Subir Gokarn said on 3 October 2012 that the central bank will factor in the impact of the government's economic reforms on growth and inflation while formulating its monetary policy. Consumer price inflation in India also remains high. Inflation based on the consumer price index stood at 9.73 % in September 2012, compared with 10.03% in August 2012. Economic Affairs Secretary Arvind Mayaram on 14 October 2012 said that he hoped the RBI would match the government's efforts with a rate cut on 30 October 2012. The outlook for Rabi or winter crops has improved following wide-spread rains in August and September. The four-month southwest monsoon season that starts from June accounts for almost 70% of total annual moisture that Indian soil receives in a year. Winter crops will gain from high soil moisture and brimming water reservoirs. The government has set food grain target for 2012-13 at 249.52 million tonnes. The Ministry of Agriculture on 24 September 2012 said as per the first advance estimates of production of Kharif crops, 117.18 million tonnes (MT) foodgrains is likely to be produced in the current Kharif season. India's merchandise exports fell 10.78% to $23.69 billion in September 2012, data released by the Ministry of Commerce & Industry on 11 October 2012 showed. Imports rose 5.09% to $41.77 billion. Oil imports jumped 30.74% to $14.09 billion whereas non-oil imports declined 4.46% to $27.68 billion. The trade deficit surged sharply to $18.08 billion in September 2012 from $13.19 in September 2011. Trade deficit declined to $89.25 billion during the six month period April-September 2012 from $89.39 billion during the six month period April-September 2011. On the political front, Bahujan Samaj Party's (BSP) chief Mayawati on 10 October 2012 said she has not taken a decision yet on whether or not to continue support to the UPA. Mayawati said that her party has left the final decision on her and she will soon take a decision. The BSP chief said the BSP is ready for early Lok Sabha elections. Attacking the UPA over corruption, Mayawati said that the government has not taken any strong steps to control corruption. BSP provides outside support to the Congress led UPA government at the Centre which has been reduced to a minority government after Trinamool Congress (TMC) withdrew support to UPA last month. The TMC withdrew support from the UPA last month to register its protest against the reformist decisions viz. allowing 51% FDI in multi-brand retail, increasing the diesel price by Rs 5 per litre, and imposing a cap on the number of subsidized LPG cylinders per family at six. Prime Minister Dr. Manmohan Singh on 21 September 2012 said that the time has come for hard decisions. Explaining the rationale for the hike in diesel price, capping of subsidised LPG cylinders per household per year and allowing foreign direct investment in multi-brand retail trade, Dr. Singh said that rapid growth in the economy is necessary to raise the government's revenue for financing its programmes in education, health care, housing and rural employment. Dr. Singh said that India must avoid high fiscal deficit which could cause a loss of confidence in the economy. The government last month braved intense political opposition to notify the rules for allowing 51% foreign direct investment (FDI) in multi-brand retail. The government also notified the relaxed conditions for single brand retail as well as the norms for allowing 49% investment by foreign airlines in Indian carries and permitted greater foreign investment in some sections of the broadcasting sector. The Cabinet Committee on Political Affairs (CCPA) raised price of heavily subsidised diesel by Rs 5 per liter on 13 September 2012 to balance government's fiscal deficit situation. The CCPA also restricted the supply of subsidized LPG cylinders to each consumer to six cylinders (of 14.2 kg) per annum. The Union Cabinet on 4 October 2012 approved a long-pending proposal to raise the foreign investment limit in insurance companies to 49% from 26%. It also approved a plan to open up the pension sector to overseas investors, allowing them to own stakes of up to 49% in local companies. Both the proposals viz. the increase in foreign investment ceiling in insurance sector and opening of pension sector to overseas investors will require Parliament's approval. The Finance Ministry early this month said that the government has decided not to proceed for the time being with the initial public offer for divestment 10% equity in Rashtriya Ispat Nigam (RINL). The government remains committed to the disinvestment programme and it will evaluate the decision in due course keeping in view all relevant factors, the statement from the Finance Ministry added. A high-level expert panel set up by the government said on 9 October 2012 that retrospective amendments in tax laws targeting overseas mergers and acquisitions of companies with assets in India should occur in exceptional or rarest of rare cases, and with particular objectives: first, to correct apparent mistakes/anomalies in the statute; second, to apply to matters that are genuinely clarificatory in nature, i.e. to remove technical defects, particularly in procedure, which have vitiated the substantive law; or, third, to "protect" the tax base from highly abusive tax planning schemes that have the main purpose of avoiding tax, without economic substance, but not to "expand" the tax base. Moreover, retrospective application of a tax law should occur only after exhaustive and transparent consultations with stakeholders who would be affected, the panel has headed by tax expert Parthasarathi Shome has said. The panel has also recommended exempting from tax foreigners investing in India's capital markets through institutions. The Finance Ministry has sought public comments on the Shome panel report on retrospective amendments to tax laws. "The views expressed in Report of the Committee are that of an independent Committee and it should not be construed in any manner whatsoever as the views of the Government", the Finance Ministry said in a statement. The views of the Government on the recommendations of the Shome panel on retrospective amendments to tax laws will be formed after receipt of their final report, the Finance Ministry said. The government will set final rules on tax avoidance within 20 days after considering recommendations made by a government panel, Finance Minister P. Chidambaram said on 1 October 2012. The panel was set up by Prime Minister Dr. Manmohan Singh to examine controversial laws known as general anti-avoidance rules (GAAR), first proposed in the budget in March, that target firms and investors routing money through tax havens. In a previous draft report, the panel had recommended that the GAAR rules be deferred for three years. The committee had also recommended that the government should abolish the tax on gains arising from transfer of listed securities, whether in the nature of capital gains or business income, to both residents as well as non-residents. The committee had said that the government might consider increasing the rate of Securities Transaction Tax (STT) appropriately to make the proposal tax neutral. At present, short-term capital gains on equities are taxable at the rate of 15%. Holding period of less than one year is considered as short term. There is no long term capital gains tax on sale of shares. Business income is taxed at 30%. Distinguishing capital gains and business income depends on several factors, and disagreements have resulted in numerous litigation cases between the Revenue Department and taxpayers, the committee had said last month. The Election Commission of India on 3 October 2012 announced the schedule of assembly elections in Gujarat and Himachal Pradesh. Assembly polls in Gujarat will take place in two phases on 13 and 17 December 2012. Assembly polls in Himachal Pradesh will take place on 4 November 2012. Counting of votes of assembly elections in Gujarat and Himachal Pradesh will take place on the same day on 20 December 2012. European stocks were mostly higher on Monday, 22 October 2012, on relief over weekend regional elections in Spain. Key benchmark indices in UK and France were up by 0.07% to 0.28%. Germany's DAX was flat. Results of regional elections in Spain during the weekend showed Spanish Prime Minister Mariano Rajoy's Popular Party retaining control in his home region of Galicia, a vote seen a mini-referendum on the government's austerity program. Meanwhile, the Nationalist party was on track to win an election in the Basque region. European Union (EU) leaders on Friday, 19 October 2012, agreed to bring banks under bloc-wide supervision next year, but failed to pin down an exact date, dashing hopes of a quick move towards a full banking union. The 27 European Union leaders set themselves "the objective of agreeing on the legislative framework by 1 January 2013," said a statement. Work on actually setting up the body would take place "in the course of 2013", it added. German Chancellor Angela Merkel called the timetable "very ambitious", even as French President Francois Hollande pushed for quick implementation. She said the EU needed "quality before speed" and a watchdog "worthy of the name." Eurozone leaders also hailed "good progress" in Greece to carry out reforms aimed at getting its economy back on track, after the so-called troika of international lenders said it hoped for a deal "within days" on resuming much-needed financial aid. Greece's conservative-led government is in talks with the troika on an austerity package needed to unlock a loan payment of 31.5 billion euros ($41.1 billion), which has been pending since June. Greek Prime Minister Antonis Samaras is set to visit the southern German state of Bavaria, the stronghold of the Christian Social Union of Bavaria party that has been strident in its criticism of Greece, German newspaper Sueddeutsche Zeitung reported on Monday, 22 October 2012. Mr. Samaras has requested a meeting in Bavaria with the state's Minister-President, Horst Seehofer, according to the newspaper, which didn't say where it got its information. Mr. Seehofer told the newspaper that Mr. Samaras was welcome to visit, and should make the trip "this year if possible." He was also "ready to make a return visit to Greece," the newspaper said. The party has struck a milder tone toward Greece of late, with Mr. Seehofer this month indicating he might support giving the country more time to reduce its debt. Many Asian stocks reversed initial losses on Monday, 22 October 2012, as trading in US index futures indicated recovery in US stocks at the opening bell on Monday, 22 October 2012, after Friday's sharp losses. Key benchmark indices in China, Japan, Hong Kong and Indonesia rose by between 0.09% to 0.68%. Key benchmark indices in Singapore, Taiwan and South Korea shed by between 0.11% to 0.48%. The latest data showed that Japan's exports fell a disappointing 10.3% in September 2012, compared to a year earlier, while imports rose 4.1%, leading to a wider-than-forecast trade deficit. The weak performance for exports came as shipments to China fell by just over 14% for the month, while those to Western Europe tumbled 26%, far outweighing a 0.9% increase in US-bound exports. The Hong Kong Monetary Authority stepped in last Friday for the first time in three years to weaken the Hong Kong dollar so as to maintain its peg with the US dollar, according to reports. China today, 22 October 2012, launched two yuan-denominated exchange-traded funds (ETF) tracking Hong Kong stocks, allowing mainland investors to indirectly trade shares in the former British colony for the first time. The ETF rollout is part of a broader liberalization and improvement by Beijing of China's tightly-controlled financial sector and capital markets as the government seeks to bolster domestic consumption and economic growth. China's securities regulator approved the ETFs in June. There are currently no grounds for further loosening of monetary policy in China, a front-page article in the Financial News, a newspaper backed by the central bank, argued on Monday, 22 October 2012. Articles in the Financial News don't necessarily represent the official views of the People's Bank of China but can reflect the thinking of central bank officials. Recent data on trade and other economic indicators show the economy may have bottomed, but there remain some downward pressures and so monetary policy shouldn't be too tight, the paper said. However, loose monetary policy won't boost economic growth, because the economy's current problem is insufficient demand, not a shortage of financing, the paper said. Trading in US index futures indicated that the Dow could gain 48 points at the opening bell on Monday, 22 October 2012. US stocks dropped sharply on Friday, 19 October 2012, as companies from General Electric Co. to McDonald's Corp. and Microsoft Corp. posted results below estimates and euro-area leaders failed to discuss aid for Spain at a summit. The Federal Open Market Committee will release its statement on Wednesday, 24 October 2012, following a two-day policy meeting on interest rates in the United States. Markit releases its October preliminary purchasing-managers' index results for the United States, euro zone, China, Germany and France on Wednesday, 24 October 2012. Election for a new president in the United States, the world's biggest economy, is scheduled on 6 November 2012. Investors are worried about US fiscal cliff. The "cliff" refers to the year-end deadline for the expiration of hundreds of billions of dollars worth of tax cuts and the triggering of $109 billion in across-the-board spending cuts. The non-partisan Congressional Budget Office has said the scenario could throw the country into recession. Congress created the hazardous deadline of 31 December 2012 in August 2011 when it agreed to a deficit deal as a way out of a deadlock over raising the US debt ceiling.