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Friday, December 01, 2006
FII: FII's net buyers of ..
FII Gross purchases Rs 4073 Cr Gross Sellers Rs 3815 Cr Net Buyers Rs 258 Cr
MF Gross Purchases Rs 589 Cr Gross Sellers Rs 677 Cr Net Sellers Rs 88 Cr
This buying by FIIs is certainly a positive. Flows are back.. However better to ignore this data which is for the last day of the expiry. This in conjunction with FII FNO data would be more useful.
Riding the retail wave
With India's burgeoning middle-class, and a relatively young population - about 500 million Indians are below the age of 24 - there is growing hunger for credit cards, auto and consumer loans, and a host of other products.
And banks, especially the new crop of private sector institutions, have been feeding this monstrous demand for credit with a slew of innovative products. India's retail banking industry grew by a whopping 120 per cent in 2005, and total asset size has topped US$ 65 billion.
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Sensex gains 148 points
Driven by the sharp gains in heavyweight, auto, capital goods, FMCG and banking stocks the market ended on a buoyant note for the third consecutive session. After registering gains of 80 points yesterday, the Sensex resumed with a positive gap of 34 points at 13730. Maintaining its upward bias, extensive buying in several sectoral stocks saw the index edge past the 13850 mark and touch an all-time high of 13858, up 162 points for the day. The Sensex closed the session with gains of 148 points at 13845. The Nifty touched an all-time high of 4001 and closed the session at 3998, up 43 points.
The breadth of the market was positive. Of the 2,650 stocks traded on the BSE, 1,516 stocks advanced, 1,063 stocks declined and 71 stocks ended unchanged. Among the sectoral indices, the BSE Auto index gained 2.84%. The BSE CG index added 1.84%, the BSE FMCG index advanced 1.61% and the BSE Bankex was up 1.53%. The remaining indices were up around 1% each.
Among the Sensex stocks Tata Motors vaulted 4.14% at Rs843, Bajaj Auto soared 3.91% at Rs2,748, Hero Honda surged 3.91% at Rs772, SBI advanced 3.52% at Rs1,360, Reliance Communication gained 3.03% at Rs442, Ranbaxy spurted 2.94% at Rs383, Dr Reddy's soared 2.62% at Rs770 and Reliance Energy was up 2.33% at Rs540.
Among the auto and auto ancillary stocks Balkrishna Industries surged 4.74% at Rs581, Punjab Tractors soared 4.58% at Rs250, Escorts advanced 3.62% at Rs122 and Amtek Auto added 3.58% at Rs367. Maruti Udyog, Cummins India and Mahindra & Mahindra gained above 2% each. However, Apollo Tyres, Asahi India and Exide Industries closed in negative territory.
BPL at Rs71.45, Godfrey at Rs1,449.05, Lakshmi Machine Works at Rs34,051.65, Thomas Cook at Rs546 and Flex Industries at Rs82.65 hit the upper circuit breaker. On the other hand Torrent Gujarat Biotech at Rs10.12 and Tips Industries at Rs27.80 hit the lower circuit on the BSE.
Over 41.96 lakh Parsvnath Developers shares were traded on the BSE followed by Dena Bank (25.75 lakh shares), Reliance Communication (16.99 lakh shares), Lanco Infratech (15.99 lakh shares) and Alstom Project (15.33 lakh shares).
Sensex about 150 points short of 14,000
The market’s gravity defying rally continues. The Sensex today struck an all-time high, and made a move closer to 14,000. A smooth rollover from November contracts on Thursday to December series coupled with robust GDP growth data released during trading hours on Thursday, lifted the Sensex by almost 150 points today. Auto scrips, PSU banks and index heavyweight Reliance Industries were at the forefront of today’s rally.
The Sensex jumped 148.47 points (1%), to settle at 13,844.78, a record closing. It is now just about 150 points away from the psychologically important 14,000 milestone.
S&P CNX Nifty advanced 43.10 points (1%), to settle at 3,997.60, a record closing. It also hit 4,001.30, a life high for the index.
The BSE clocked a turnover of Rs 4,451 crore, compared to Thursday’s Rs 4,854 crore.
The market-breadth was strong. For 1,484 shares that rose on BSE, 1,080 declined. As many as 72 stocks were unchanged.
The salient feature of the recent rally has been a surge in small-cap and mid-cap shares. Even as the Sensex kept striking a string of record highs over the past few days, small-cap and mid-cap stocks had lacked momentum.
From 6,531.39 on 28 November, the BSE Small Cap Index has risen 187.35 points (2.8%) in the past three trading sessions to current 6,718.74. From 5,651.21 on 28 November, the BSE Mid Cap Index has gained 124.21 points (2.1%) in three days, to current 5,775.42. The Sensex added 242.83 points (1.7%) in this three-day period, from 13,601.95 on 28 November 2006.
The market sentiment remains bullish due to strong FII-inflows and an upward revision in earnings growth by brokerages, on the back of strong Q2 results. Widespread optimism that FIIs may step up buying this month, as allocations are made for calendar 2007. FII inflow in 2006 has reached $8.7 billion, compared to a record inflow of $10.7 billion in 2005.
The BSE Sensex is up 47.3% in calendar 2006 so far. From 4,644 on 23 June 2004, it has galloped 198% in less than two-and-a-half years. A section of the market attributes the solid surge on the Indian bourses, to increasing recognition of India’s long-term growth prospects. India’s growth drivers are a favourable demography (large share of young population), robust domestic consumption and acceleration in infrastructure creation.
In today’s trade, Ranbaxy Laboratories surged nearly 4% to Rs 385.60, with the stock rallying in late-trading after the company announced the acquisition of Be-Tabs Pharmaceuticals, the fifth largest generic drugs company in South Africa, for $70 million.
Auto shares dominated the proceedings on decent-to-strong sales numbers for November. Bajaj Auto rose 4% to Rs 2,751, after its total sales rose 33% in November 2006, to 2,43,713 units from a year ago. Bike sales rose 36% to 2,14,321 units and sales of three-wheelers were up 71% at 29,384 units. Exports rose 56% to 36,086.
Hero Honda rose nearly 2% to Rs 757.35. Hero Honda today launched two variants of its CD series motorcycles, CD Deluxe and CD Dawn, in the 100-cc, entry-level segment.
Tata Motors surged 4% to Rs 844.25, on expectations of strong sales for November 2006. Tata Motors is likely to disclose its monthly sales figures today.
Car major Maruti Udyog added nearly 3% to Rs 952.60. In early-trade today, the car major reported selling 55,033 vehicles in November, a 16.1% rise from a year earlier. The company said domestic sales rose an annual 20.7%, to 52,574, but exports fell 35.7% to 2,459 units.
PSU banks were in demand after the latest data showed lower-than- expected rise in inflation. SBI jumped 4% to Rs 1,369.90. The stock hit Rs 1,370, a life high for the scrip.
Cellular services provider Reliance Communications rose 3.7% to Rs 445.25. The scrip struck Rs 446.90, an all-time high. A staggering 16.8 lakh shares changed hands in the counter on BSE.
Reliance Energy gained 2.2% to Rs 540.05. As per reports, Maharashtra Electricity Regulation Commission has directed the company to discontinue levy of load management charges.
Reliance Industries gained 1.3% to Rs 1,262.25. A strong 7.4 lakh shares changed hands in the counter.
A host of power equipment makers/solutions provider to the power sector surged. Alstom Projects jumped 9.7% to Rs 468.90, Bharat Bijlee gained 7.9% to Rs 1,205, ABB surged 7% to Rs 3,747, Voltamp Transformers gained 5.8% to Rs 631.80, Areva T&D rose 5% to Rs 972.10, Siemens advanced 4.7% to Rs 1,182, and KEC International gained 3% to Rs 390.
Construction firm Punj Lloyd jumped 7.6% to Rs 1,112, after the firm said it had an order worth Rs 1,000 crore to construct an LDPE manufacturing plant in Thailand.
Gas cylinder maker Everest Kanto Cylinder jumped 10% to Rs 606.50, on expectation that the firm will announce a large order in the next few days.
Thomas Cook India jumped 10% to Rs 564.05, ahead of the company's board meeting to consider merger and acquisition proposals.
Sponge iron and steelmaker Raipur Alloys and Steel jumped 14% to Rs 140 after the company informed Friday that Reliance Long Term Equity scheme of Reliance mutual fund purchased 9.62% in it. The fund acquired about 1.26 million shares on 29 Nov, the company said.
Essar Shipping jumped 17.8% to Rs 27.80. The company today said it had received a letter from promoters, Essar Shipping & Logistics, to delist the company's shares from BSE. The company has called a board meeting on Saturday, to consider delisting.
McLeod Russel India rose 2.6% to Rs 109.95 on reports that the company had acquired 72 % stake in Moran Tea Co for Rs 41.50 crore. The acquisition of Moran Tea will add Rs 32 - Rs 33 core to McLeod's annual revenue, Managing Director Aditya Khaitan said.
Paramount Communications jumped 8.5% to Rs 255. The scrip rose on heavy volume of 37.1 lakh shares on BSE. A block deal of 2,67,268 shares was executed in the stock on BSE, at Rs 247.
Global Vectra Helicorp jumped 20% to Rs 192, on reports that the government is planning to raise FDI limit to 74% in helicopter services, non-scheduled airline operations and regional airlines using small aircraft. The current ceiling for airline services is 49%.
Shoppers’ Stop rose 3% to Rs 702.25, after the company formed a 50:50 joint venture with Swiss firm Nuance Group, a global market leader in the airport retail space, to operate duty free shops at international airports in India.
Ispat Industries was flat at Rs 11.09. The company has reduced prices of hot-rolled coils by Rs 400 - Rs 600 per tonne, with immediate effect.
Tamil Nadu Newsprint & Papers gained 1.5% to Rs 94. The company said on Friday that Reliance Growth Fund and Reliance Portfolio Management Services, have picked up an additional 0.32% stake in the company. This takes their collective stake to 5.08%
Nandan Exim dropped 5% to Rs 10.55 in volatile trade. Initially, the scrip had surged 5% to Rs 11.65 after a block deal of 5 lakh shares was executed in the scrip on BSE, at Rs 11.45.
Steel Strips Wheels rose 3% to Rs 155.90, after the company said on Friday its November sales of wheel rims rose to 4,10,086 units, up 35% from a year ago. It produced 4,00,824 wheel rims in November compared to 2,68,555 rims same month a year ago.
Flex Industries (up 20% to Rs 82.65) surged for the second day in a row after the company said on Thursday that the merger of two other group companies, had been cleared by the Delhi High Court. Group companies, Flex Engineering and FCL Technologies, will be merged with Flex Industries, enabling accumulation of resources under a single entity that will provide end-to-end packaging solutions.
Financial Technologies shed 1.8% to Rs 2,062. The company on Thursday said it had in principle approval from the Financial Services Commission, Mauritius, for setting up an international multi-commodity exchange styled Global Board of Trade.
TRF lost 0.8% to Rs 425. ACC has cut its stake in the company by 2%, bringing it down to 4.54%, informed TRF.
HCL Infosystems rose 0.3% to Rs 165. The personal computers market recorded 24% growth in the third quarter ended 30 September 2006. HCL Infosystems has retailed its number two slot with a market share of 12%.
Graphite India rose 1.4% to Rs 303, after the company fixed 18 December 2006 as a record date for 5-for-1 stock-split.
India's economic growth accelerates
India's economic growth accelerated to 9.2 percent in the July-September quarter compared with a year ago, the government said Thursday, bringing it closer to China's sizzling growth rate.
Fueled by a brisk expansion of the services sector and a surge in manufacturing output, India's gross domestic product expanded at a faster pace than the 8.9 percent growth in the previous quarter.
The numbers beat expectations and prompted many analysts to revise their forecasts for the full fiscal year through March 2007.
"We are revising our full year growth estimate to 8.4 percent from 7.9 percent," said Shubhada Rao, chief economist at Yes Bank.
If that projection comes true, it would be the fourth straight year of 8 percent-plus growth for India, one of the world's fastest-growing economies after China, which grew 10.4 percent in the July-September quarter.
Some analysts expected GDP growth to moderate through the later part of the year because of high oil prices and a possible slowdown in global demand for Indian exports.
But manufactured output rose 11.9 percent during the July-September period compared with 8.1 percent in the same period last year. The growth was mostly driven by a surge in exports.
High oil prices have also pushed inflation and interest rates, and many thought that would also impact services such as transportation, banking and trade.
But the services sector, which accounts for more than half of India's GDP, continued to be buoyant. Trade, hotels and transport services expanded 13.9 percent, while financial services business grew 9.5 percent.
"The upside surprise relative to our forecast came almost entirely from the unexpected acceleration in service sector activity," said Rajeev Malik, a Singapore-based economist with JP Morgan Chase Bank.
JP Morgan was revising its forecast for India's economic growth in the current fiscal year to 8.4 percent from an earlier projection of 8 percent, he said.
Malik said he expects India's central bank to hike key interest rates by at least a quarter percentage point in December or January to keep inflation under check. "The Indian economy is not overheating, though the impressive growth momentum is showing some signs of excesses."
The sluggish performance of the agriculture sector, however, remained a concern. During the July-September period, farm output grew just 1.7 percent, sharply down from 4.1 percent in the same quarter a year ago.
About two-thirds of India's 1 billion people live on agriculture and most of them earn less than a dollar a day. They has been left untouched by India's economic boom over the past decade -- which has been driven by the expansion of industry and services.
IPO hunters lose Rs 14k cr in one year
Primary market investors have hit the jackpot with many of the past new issues attracting hefty premium on listing and recording sharp appreciation in the subsequent weeks. But, not all primary market investors have been lucky enough to gain from the boom as some of newly listed companies have lost momentum after the initial euphoria.
Investors have lost wealth to the tune of Rs 14,000 crore in about 60 companies listed in the past one year as their share prices have fallen substantially since listing. Some of them have even slipped below offer prices, going by the trend on the BSE.
Reliance Petroleum (RPL) topped the list, recording a m-cap loss of Rs 8,307 crore since its listing on May 11, ’06. From its listing price of Rs 85.5, the RPL stock price has fallen 22% to end at Rs 67 on Wednesday. The Sensex rose 9.5% during the period. The scrip, however, is still quoting at a premium to the offer price of Rs 60 per share.
Apart from RPL, there are many other companies whose stocks have lost ground but still quoting above offer prices. GTL Infrastructure, Tantia Construction, Inox Leisure, ABG Shipyard, Plethico Pharmaceuticals, Royal Orchid and PVR are few notable examples of this phenomenon. They are currently quoting at a discount of 3% to 32% (Tantia Construction) to listed prices but at premium between 12% and 301% (GTL Infrastructure) to offer price.
Analysts cite many reasons for these companies’ underperformance against the market which has been on a dream run after crashing below 9,000 in June. Large companies like RPL is a long term bet given the nature of the project the company has been implementing, said an analyst at a leading domestic brokerage.
In April this year, RPL had gone public with an offer of 135 crore shares through the 100% book building route. The issue proceeds are being utilised to part finance the Rs 27,000-crore export-oriented refinery being set up in a special economic zone at Jamnagar in Gujarat. The project is likely to go on stream by December ’08.
Analysts also said new listings could not sustain momentum probably because the market felt offer prices were higher than expectations. This could be one reason why some of the IPOs are quoting below offer prices in the current market. As many as 30 of the 60 new listings are currently trading below their respective offer prices.
GVK Power, Pyramid Retail, Prime Focus, Repro India and Global Vectra are few such examples.
Nifty hits 4,000 in late-trading
The S&P CNX Nifty pierced the 4,000 mark at the fag end of trading. The BSE Sensex surged over 150 points due to buying in auto scrips, PSU banks and index heavyweight Reliance Industries.
A smooth rollover from November contracts on Thursday to December series coupled with robust GDP growth data released during trading hours on Thursday, provided support on a day when Asian markets traded mixed.
The Sensex’s provisional closing was 13,853.81, a gain of 157.50 points. The barometer index struck a new record of 13,857.81 at 15:01 IST.
The Nifty had gained 43.20 points (1%), to 3,997.70, as per the provisional closing. It also climbed to a record high of 4,001.30.
The BSE clocked a turnover of Rs 4,451 crore.
Ranbaxy Laboratories surged nearly 4% to Rs 385.60, with the stock rallying in late trading after the company announced the acquisition of Be-Tabs Pharmaceuticals, the fifth largest generics company in South Africa, for $70 million.
Auto shares dominated the proceedings on decent-to-strong sales numbers for November. Bajaj Auto rose 4% to Rs 2,751 after its total sales rose 33% in November 2006, to 2,43,713 units from a year ago. Bike sales rose 36% to 2,14,321 units and sales of three-wheelers were up 71% at 29,384 units. Exports rose 56% to 36,086.
Hero Honda rose nearly 2% to Rs 757.35. Hero Honda today launched two variants of its CD series motorcycles, CD Deluxe and CD Dawn, in the 100-cc, entry-level segment.
Tata Motors surged 4% to Rs 844.25, on expectations of strong sales for November 2006. Tata Motors is likely to disclose its monthly sales figures today.
Car major Maruti Udyog added nearly 3% to Rs 952.60. In early-trade today, the car major reported selling 55,033 vehicles in November, a 16.1% rise from a year earlier. The company said domestic sales rose an annual 20.7%, to 52,574, but exports fell 35.7% to 2,459 units.
PSU banks were in demand after the latest data showed lower-than- expected rise in inflation. SBI was jumped 4% to Rs 1,369.90. The stock hit Rs 1,370, which is a life high for the scrip.
Cellular services provider Reliance Communications rose 3.7% to Rs 445.25. The scrip struck Rs 446.90, an all-time high. A staggering 16.8 lakh shares changed hands in the counter on BSE.
Reliance Energy gained 2.2% to Rs 540.05. As per reports, Maharashtra Electricity Regulation Commission has directed the company to discontinue levy of load management charges.
Reliance Industries gained 1.3% to Rs 1,262.25. A strong 7.4 lakh shares changed hands in the counter.
India's growth story just got better
GDP grows 9.2% in Q2, fastest half-year rise since 1991.
India’s economic growth rate accelerated to 9.2 per cent in the July-September quarter from 8.4 per cent in the year-ago quarter on the back of a strong performance by the manufacturing and services sectors, raising the likelihood of interest rates being raised in January 2007.
Taken along with 8.9 per cent growth in the first quarter of the current financial year, this comes to 9.1 per cent growth for the first six months of 2006-07. Finance Minister P Chidambaram said this was the highest first-half GDP growth since 1991-92, when economic reforms were initiated.
He added that the 9.2 per cent growth clocked in the second quarter was among the highest growth rates in recent years.
“Higher growth rates were only seen in the fourth quarter of 2005-06, which saw 9.3 per cent growth and in the third quarter of 2003-04, which saw 11.3 per cent rise. This, however, was on a low base of 1.5 per cent,” he said.
After today’s numbers, economists said they might look at revising their growth forecast for the whole year. “Overall, we are revising up our full-year forecast marginally to about 8.2-8.3 per cent from 8.0 per cent,” JP Morgan Economist Rajiv Malik told agency.
“With GDP growth for the first half at 9.1 per cent, it is certain that there will be an upward revision for the full year. If the growth momentum is maintained, I see full-year GDP growing at close to 9 per cent,” added CRISIL Chief Economist Subir Gokarn.
Asked to comment on the expected annual rate of growth, Chidambaram said, “There is no limit to my expectation on GDP growth.”
He also played down concerns of increased pressure on interest rates on account of the high economic growth rate.
“There is ample liquidity in the system. Only yesterday, the Reserve Bank of India absorbed Rs 2,400 crore through reverse repo.” He endorsed the RBI’s view that it was premature to think of the economy “overheating.”
The finance minister said all sectors had done better in the second quarter than in the first one, barring agriculture and mining and quarrying. Commenting on the 1.7 per cent growth in agriculture, he said this was not unusual.
“The second quarter is always a lean quarter, as only a part of the kharif crop has come in, and the rabi crops come in in the third and the fourth quarters,” he felt.
“One of the worrying factors is the slightly high inflation, which is largely driven by supply side constraints. But with better supply side management and sugar and wheat stocks building up, I am confident that inflation can be tamed,” the minister said.
Poweryourtrade.com Trading Calls
Buy Bharti Airtel with stop loss of Rs 610 for target of Rs 696
Buy HDFC Bank with stop loss of Rs 1060 for target of Rs 1230
Buy Bharti Airtel below Rs 634 with stop loss of Rs 626; This is a day trading recommendation
Short sell IPCL above Rs 273 with stop loss of Rs 278; This is a day trading recommendation
Buy Biocon with stop loss below Rs 367 for target of Rs 383–387
Sell BPCL with a stop loss above Rs 350.10 for target of Rs 336
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