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Tuesday, March 17, 2009
Syndicate Bank
We recommend a buy of Syndicate Bank’s stocks from a short-term trading perspective. It is evident from the charts that after encountering resistance around Rs 70 in early January, the stock began to trend downward. This downtrend accelerated in late February and the stock witnessed a sharp fall penetrating the key support level at Rs 48.5. It finally halted at Rs 37.6 that is also its 52-week low. The stock reversed direction forming a bullish reversal candlestick pattern, namely bullish harami candlestick pattern.
Subsequently, the stock gained 8 per cent on March 16. This trend reversal has been backed by positive divergence in the daily relative strength index (RSI), which recovered from oversold region. We are bullish on the stock from a short-term perspective.We expect the current rally to continue until it hits our price target of Rs 48.5 in the forthcoming trading sessions. Traders with short-term perspective can buy the stock while maintaining a stop-loss at Rs 41.50.
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Asian stocks open on a positive note
Asian stocks gained, led by financial and commodity companies, on optimism bank earnings will recover and metal prices jumped.
Mizuho Financial Group gained more than 3.5% on speculation the Bank of Japan may act to shore up bank capital and after London-based Barclays said it had a strong start to 2009.
Japanese benchmark index Nikkei gained 123.54 points, or 1.60%, to trade at 7,827.69.
Hong Kong`s Hang Seng index dropped 27.86 points, or 0.21%, to trade at 12,948.85.
China`s Shanghai Composite climbed 12.46 points, or 0.58%, to trade at 2,165.76.
Taiwan`s Taiex index went up 14.40 points, or 0.29%, to trade at 4,985.72.
South Korea`s Kospi index increased 19.25 points, or 1.71%, to trade at 1,144.71.
Singapore`s Straits Times fell 21.19 points, or 1.34%, to trade at 1,565.13. (7.44 a.m., IST).
Bullion metals end lower
Prices drop for the first time in four days as stocks rally globally
Bullion metals dropped for the first time in four days on Monday, 16 March, 2009 as stocks rallied globally decreasing the appeal of the precious metals. Stocks at Wall Street had rallied for the fourth consecutive day today.
Generally, a stronger dollar pressures demand for dollar-denominated commodities, such as crude oil and gold, which become more expensive for holders of other currencies and also vice versa.
On Monday, Comex Gold for April delivery fell $8.1 (0.9%) to close at $922 an ounce on the New York Mercantile Exchange. Earlier last Tuesday, gold had dropped below $900 for first time in two months. Before today, gold had climbed by almost 4% in the past three sessions. Last week, the yellow metal ended lower by 1.5%. For the month of February, gold ended higher by 7.4%. For January, 2009, gold had gained 3.9%. Year to date, gold prices are higher by 4.5%.
On 17 March, 2008 prices had skyrocketed to a high of $1,034/ounce. But prices have dropped somewhat (8.9%) since then.
On Monday, Comex silver futures for May delivery fell 32.5 cents (2.5%) to end at $12.89 an ounce. Last week, silver fell 0.8% In February, 2009, silver had rose 4.3% after climbing 14% in January. Year to date, silver has climbed 12% this year. For 2008, silver had lost 24%.
In 2008, gold prices ended higher by 5.5%. The dollar index had gained 12% that year.
Last year, the weakening dollar and higher global demand for raw materials had led to records for commodities including gold. Gold reached a record in March 2008 as a U.S. housing slump and credit crisis spurred the Federal Reserve to slash borrowing costs. In the last move, the Federal Reserve has cuts its target bank lending rate to 0.25% from 5.25% in September, 2007. The Fed did it in nine steps.
Prior to 2008, gold had witnessed the greatest annual gain in twenty eight years by gaining $200/ounce (31%) in FY 2007 as lower interest rates had sent the dollar tumbling, and crude-oil prices rose to a record. Silver had climbed 16% in FY 2007. In 2006, silver had jumped 46% while gold gained 23%.
At the MCX, gold prices for April delivery closed lower by Rs 124 (0.80%) at Rs 15,191 per 10 grams. Prices rose to a high of Rs 15,350 per 10 grams and fell to a low of Rs 15,112 per 10 grams during the day's trading.
At the MCX, silver prices for May delivery closed Rs 398 (1.8%) lower at Rs 21,879/Kg. Prices opened at Rs 22,251/kg and fell to a low of Rs 21,740/Kg during the day's trading.
Monday, March 16, 2009
BSE Bulk Deals to Watch - March 16 2009
Deal Date Scrip Code Company Client Name Deal Type * Quantity Price **
16/3/2009 532840 ADVANTA MORGAN STANLEY MAURITIUS COMPANY LIMITED B 85000 447.00
16/3/2009 532840 ADVANTA MORGAN STANLEY INVESTMENTS MAURITIUS LIMITED S 85000 447.00
16/3/2009 530707 AFTEK LTD MEGA RESOURCES LTD S 550000 7.05
16/3/2009 533029 ALKALI ALIN AJAYKUMAR SHAH B 56500 174.84
16/3/2009 533029 ALKALI MAVI INVESTMENT FUND LTD. S 62500 173.42
16/3/2009 524388 CRAZY INFOTE ALKA DAGA B 342800 0.83
16/3/2009 530393 DB(INTR) STBR SADHNA RATHI S 15501 19.95
16/3/2009 526285 DIVYAJYO IND PULKIT KUMAR NYATI B 140000 6.84
16/3/2009 532876 EVERONN SYS MATRIX EQUITRADE PVT. LTD. B 101694 120.25
16/3/2009 532876 EVERONN SYS OPG SECURITIES P LTD B 336703 111.22
16/3/2009 532876 EVERONN SYS H.J. SECURITIES PVT. LTD. B 248780 114.56
16/3/2009 532876 EVERONN SYS MATRIX EQUITRADE PVT. LTD. S 101694 120.47
16/3/2009 532876 EVERONN SYS OPG SECURITIES P LTD S 336703 111.37
16/3/2009 532876 EVERONN SYS H.J. SECURITIES PVT. LTD. S 248780 114.74
16/3/2009 531524 I.C.S.A. IND CLSA MAURITIUS LIMITED S 365000 51.01
16/3/2009 590003 KARUR VYSYA-PMS SATABDI INVESTMENTS PVT LTD S 278000 192.19
16/3/2009 590003 KARUR VYSYA-PMS SHRINE FINANCE INVESTMENTS PVT LTD S 318000 192.32
16/3/2009 531687 KARUTURI GLO MORGAN STANLEY MAURITIUS COMPANY LIMITED B 2500000 9.59
16/3/2009 531687 KARUTURI GLO MORGAN STANLEY INVESTMENTS MAURITIUS LIMITED S 2500000 9.59
16/3/2009 511728 KZLEASING NAINESH HIMAT JATANIA B 27000 67.65
16/3/2009 511728 KZLEASING KAMLESH H DAFTARY B 15400 67.96
16/3/2009 511728 KZLEASING YOGESH GIRDHARLAL PANDYA S 27051 67.59
16/3/2009 511728 KZLEASING AMI STOCK SHARE BROKERS PLTD S 50000 68.90
16/3/2009 511728 KZLEASING NAINESH HIMAT JATANIA S 27000 69.16
16/3/2009 511728 KZLEASING KARAN MAHESHKUMAR HADVANI S 16560 69.34
16/3/2009 517518 LLOYD ELE EN MORGAN STANLEY MAURITIUS COMPANY LIMITED B 244828 14.90
16/3/2009 517518 LLOYD ELE EN MORGAN STANLEY INVESTMENTS MAURITIUS LIMITED S 244828 14.90
16/3/2009 531096 MOUNT EVE MI MORGAN STANLEY MAURITIUS COMPANY LIMITED B 588621 39.00
16/3/2009 531096 MOUNT EVE MI MORGAN STANLEY INVESTMENTS MAURITIUS LIMITED S 588621 39.00
16/3/2009 532517 PATNI COMPUT HSBC GLOBAL INVT FUNDS AC HSBC GLOBAL INVST FUNDS MAURITIUS LTD S 1000000 110.00
16/3/2009 531746 PRAJAY ENG S MORGAN STANLEY MAURITIUS COMPANY LIMITED B 239000 13.35
16/3/2009 531746 PRAJAY ENG S MORGAN STANLEY INVESTMENTS MAURITIUS LIMITED S 239000 13.35
16/3/2009 523523 RAINBOW PAPE PRIYANK GAUTAMCHAND SURANA B 70000 34.90
16/3/2009 531569 SANJIVA PARA VIRENDRA MOHANLAL PATEL S 45000 10.95
16/3/2009 511431 VAKRAN SOFTW MORGAN STANLEY MAURITIUS COMPANY LIMITED B 453000 21.70
16/3/2009 511431 VAKRAN SOFTW MORGAN STANLEY INVESTMENTS MAURITIUS LIMITED S 453000 21.70
16/3/2009 526953 VENUS REMEDS MORGAN STANLEY MAURITIUS COMPANY LIMITED B 100000 160.00
16/3/2009 526953 VENUS REMEDS MORGAN STANLEY INVESTMENTS MAURITIUS LIMITED S 100000 160.00
16/3/2009 531249 WELL PACK PA KAMLESH NAHAR B 23000 93.86
NSE Bulk Deals to Watch - March 16 2009
Date,Symbol,Security Name,Client Name,Buy/Sell,Quantity Traded,Trade Price / Wght. Avg. Price,Remarks
16-MAR-2009,ALKALI,Alkali Metals Limited,ALIN AJAYKUMAR SHAH,BUY,56500,174.84,-
16-MAR-2009,AMTEKINDIA,Amtek India Limited,J.P.MORGAN SECURITIES LTD A/C,BUY,2280000,32.00,-
16-MAR-2009,APOLLOSIND,Apollo Sindhoori Capital,THANGAMMAL,BUY,733993,9.95,-
16-MAR-2009,CENTUM,Centum Electronics Ltd.,SWAPNA KANTHETI,BUY,53702,19.75,-
16-MAR-2009,EDUCOMP,Educomp Solutions Limited,C D INTEGRATED SERVICES LTD,BUY,132434,1893.61,-
16-MAR-2009,EVERONN,Everonn Systems India Lim,ADROIT FINANCIAL SERVICES PVT LTD,BUY,115269,117.96,-
16-MAR-2009,EVERONN,Everonn Systems India Lim,BP FINTRADE PRIVATE LIMITED,BUY,192687,109.40,-
16-MAR-2009,EVERONN,Everonn Systems India Lim,C D INTEGRATED SERVICES LTD,BUY,76044,115.47,-
16-MAR-2009,EVERONN,Everonn Systems India Lim,COMPOSITE SECURITIES LTD,BUY,151316,117.29,-
16-MAR-2009,EVERONN,Everonn Systems India Lim,EAST INDIA SECURITIES LTD.,BUY,91680,116.54,-
16-MAR-2009,EVERONN,Everonn Systems India Lim,MANIPUT INVESTMENTS PVT LTD,BUY,125288,116.26,-
16-MAR-2009,EVERONN,Everonn Systems India Lim,NIRSHILP SECURITIES PVT. LTD.,BUY,128136,111.03,-
16-MAR-2009,EVERONN,Everonn Systems India Lim,OM INVESTMENTS,BUY,305269,115.82,-
16-MAR-2009,EVERONN,Everonn Systems India Lim,P R B SECURITIES PRIVATE LTD,BUY,83050,117.88,-
16-MAR-2009,EVERONN,Everonn Systems India Lim,SUNEET LAL,BUY,246255,104.90,-
16-MAR-2009,EVERONN,Everonn Systems India Lim,TODI SECURITIES PVT. LTD.,BUY,82508,118.01,-
16-MAR-2009,EVERONN,Everonn Systems India Lim,TRANSGLOBAL SECURITIES LTD.,BUY,147799,115.01,-
16-MAR-2009,PATNI,Patni Computer Systems L,RELIANCE CAPITAL TRUSTEE CO. LTD. A/C RELIANCE GROWTH FUND,BUY,1600000,110.00,-
16-MAR-2009,PRIMESECU,Prime Securities Limited,JUDITH INVESTMENT PRIVATE LIMITED,BUY,1798996,10.60,-
16-MAR-2009,ZANDUPHARM,Zandu Pharma works Ltd,IRIS MERCANTILE PVT. LTD,BUY,4500,4658.33,-
16-MAR-2009,ALKALI,Alkali Metals Limited,MAVI INVESTMENT FUND LTD DEUTSCHE BANK,SELL,62500,173.46,-
16-MAR-2009,AMTEKINDIA,Amtek India Limited,HSBC EQUITY FUND - MF/046/02/5/HEF,SELL,1502964,32.00,-
16-MAR-2009,APOLLOSIND,Apollo Sindhoori Capital,BALASUBRAMANIAN P S,SELL,325360,9.90,-
16-MAR-2009,APOLLOSIND,Apollo Sindhoori Capital,VAIDYANATHAN KALYANI,SELL,325360,9.95,-
16-MAR-2009,CENTUM,Centum Electronics Ltd.,ALLIANZ BAJAJ LIFE INSURANCE CO.LTD.,SELL,54804,19.89,-
16-MAR-2009,EDUCOMP,Educomp Solutions Limited,C D INTEGRATED SERVICES LTD,SELL,132734,1894.44,-
16-MAR-2009,EVERONN,Everonn Systems India Lim,ADROIT FINANCIAL SERVICES PVT LTD,SELL,115269,118.14,-
16-MAR-2009,EVERONN,Everonn Systems India Lim,BP FINTRADE PRIVATE LIMITED,SELL,192815,109.45,-
16-MAR-2009,EVERONN,Everonn Systems India Lim,C D INTEGRATED SERVICES LTD,SELL,76044,115.66,-
16-MAR-2009,EVERONN,Everonn Systems India Lim,COMPOSITE SECURITIES LTD,SELL,151316,117.68,-
16-MAR-2009,EVERONN,Everonn Systems India Lim,EAST INDIA SECURITIES LTD.,SELL,91680,116.89,-
16-MAR-2009,EVERONN,Everonn Systems India Lim,MANIPUT INVESTMENTS PVT LTD,SELL,125288,116.54,-
16-MAR-2009,EVERONN,Everonn Systems India Lim,NIRSHILP SECURITIES PVT. LTD.,SELL,132936,110.46,-
16-MAR-2009,EVERONN,Everonn Systems India Lim,OM INVESTMENTS,SELL,305269,115.98,-
16-MAR-2009,EVERONN,Everonn Systems India Lim,P R B SECURITIES PRIVATE LTD,SELL,83050,117.87,-
16-MAR-2009,EVERONN,Everonn Systems India Lim,SUNEET LAL,SELL,243855,105.74,-
16-MAR-2009,EVERONN,Everonn Systems India Lim,TODI SECURITIES PVT. LTD.,SELL,82508,118.07,-
16-MAR-2009,EVERONN,Everonn Systems India Lim,TRANSGLOBAL SECURITIES LTD.,SELL,145799,114.92,-
16-MAR-2009,ICSA,ICSA (India) Limited,CLSA (MAURITIUS) LIMITED,SELL,535000,51.10,-
16-MAR-2009,PATNI,Patni Computer Systems L,HSBC GLOBAL INVESTMENT FUNDS A/C HSBC GLOBAL INVESTMENT FUN,SELL,2104439,110.00,-
16-MAR-2009,PRIMESECU,Prime Securities Limited,MADHU JAYAKUMAR,SELL,1798400,10.60,-
16-MAR-2009,ZANDUPHARM,Zandu Pharma works Ltd,VAIPA PHARMACEUTICALS PRIVATE LIMITED,SELL,4500,4658.33,-
Post Session Commentary - March 16 2009
Indian market exhibited a good show after the mid session to close with gains of more than 2% on significant buying pressures across the sectoral indices. Key benchmark indices pulled back after touching red zone tracking positive cues from the Asian markets, which touched one month high. Firm European markets also contributed to the upward movement.
The domestic market opened marginally up on the back of positive cues from the markets all over the world. US stock markets on Friday ended higher for the fourth consecutive day mainly led by the financial stocks. Soon after start, benchmark indices turned volatile and slipped from its high amid mixed cues from Asian stocks. The market swung between positive and negative territory on account of lack of clarity over any particular direction. Further, market managed go gain momentum on initial buying from foreign funds and expectation of short-term recovery in domestic economy. Finally, market surged to day’s high on intense buying on key stocks. BSE Sensex ended above 8,900 mark and NSE Nifty above 2,800 level. From the sectoral front, all indices ended in green. Among those, Reality, Oil & Gas, Consumer Durable, PSU, Bank and Capital Goods stocks witnessed most of the buying. BSE Mid Cap and Small Cap stocks also followed the same trend.
Among the Sensex pack 25 stocks ended in green territory and 5 in red. The market breadth indicating the overall health of the market remained strong as 1611 stocks closed in green while 847 stocks closed in red and 87 stocks remained unchanged in BSE.
The BSE Sensex closed higher by 186.93 points at 8,943.54 and NSE Nifty ended up by 58 points at 2,777.25. BSE Mid Caps and BSE Small Caps ended with gains of 60.20 points and 64.43 points at 2,700.56 and 2,998.49 respectively. The BSE Sensex touched intraday high of 8,955.73 and intraday low of 8,697.46.
Gainers from the BSE Sensex pack are JP Associates (8.96%), M&M Ltd (8.48%), Ranbaxy Lab (6.82%), RCom (6.74%), DLF Ltd (6.16%), ICICI Bank (4.52%), SBI (3.65%), Sterlie Industries (3.52%), Reliance (3.45%) and Tata Motors (2.97%).
Losers from the BSE Sensex pack are Sun Pharma (2.05%), Maruti Suzuki (1.90%), Grasim Indus (1.03%), Infosys Tech (0.62%) and Reliance Infra (0.41%).
The advance tax payment of RIL fell 16.47% to Rs 370 crore in Q4 March 2009 over Q4 March 2008 along with Tata Steel fell 23.33% to Rs 230 crore while SBI''s tax payment has surged 57.66% to Rs 1,810.crore.
On the global markets front the Asian markets which opened before the Indian market, ended higher on cautious optimism that government pledges to mend the financial system and encourage growth, which will give a boost to the deteriorating world economy. Shanghai Composite, Seng, Nikkei 225, and Straits Times index ended higher by 24.44, 450.91, 134.87 and 8.8 points at 2,153.29, 12,976.71, 7,704.15 and 1,586.32 respectively. However, Seoul Composite lost 0.57 points at 1,125.46
European markets which opened after the Indian market are trading in higher as investor confidence is strong on positive outlooks from both the Federal Reserve Chairman Ben Bernanke and the meeting of the Group of 20 leading economies over the weekend. In London FTSE 100 is trading higher by 69.31 points at 3,822.99 and in Frankfurt the DAX index is trading down by 91.20 points at 4,044.80.
The BSE Reality index outperformed the benchmark indices and ended up by (5.35%) or 75.35 points at 1,483.91 on hopes lower rates will encourage housing demand. Gainers are Mahindra Life (22.03%), Akruti city (19.05%), Pheonix Mill (6.97%), Parsvnath (6.17%) and DLF Ltd (6.16%).
The BSE Oil & Gas index ended higher by (3.44%) or 209.74 points to close at 6,298.26. Reliance Natural Resources (16.03%), Essar Oil Ltd (14.72%), HPCL (8.30%), Aban Offshore (6.23%) and Gail India (4.88%) ended in positive territory.
The BSE Bank index closed with increase of (2.86%) or 113.54 points at 4,087.39 on hopes lower interest rates may boost lending growth. Scrips that gained are IDBI Bank (6.42%), ICICI Bank (4.52%), Axis Bank (3.68%), SBI (3.65%) and Karnataka Bank (3.48%).
The BSE PSU stocks also joined the rally as advanced by (5.63%) or 116.79 points to close at 2,190.32. Main gainers are NIIT Ltd (9.52%), HCL Tech (7.19%), Oracle Fin (6.97%), TCS Ltd (6.57%) and Infosys Tech (5.64%).
The BSE FMCG index gained (2.73%) or 51.35 points to close at 1,935.15. Main gainers are United Spr (6.20%), Colgate Palm (4.77%), United Brew (3.49%), Dabur India (3%) and Britania In (2.97%).
The BSE Consumer Durable index gained (2.72%) or 40.21 points to close at 1,519.77. Gainers are Gitanjali GE (4.23%), Titna Ind (3.05%), Blue Star L (2.79%), Videocon Ind (2.30%) and Rajesh Export (2.20%).
Bharti Airtel ended up by 2.37%. The company is planning to restructure its businesses into nine arms with different CEOs. It is planning for reshuffle to expand into areas beyond its mainstream. Main aim behind the plan is to provide a platform to the talents. The company has already identified some of areas like entertainment, mobile commerce, internet, media, enterprise services and small & medium businesses.
HCL Technologies closed higher by 5.62%. The company has bagged a seven-year, $350-million total IT services outsourcing contract from media firm Readers'' Digest Association (RDA). Under the deal, HCL will provide applications development and maintenance (ADM) services and infrastructure support to the New York- headquartered publisher of the Readers’ Digest.
Tata Motors gained 2.97%. The company launches new Safari variant, i.e the new Gx variant. The current Safari DICOR range comprises three variants: Lx, Ex and Vx.
PNB advanced by 1.77%. The life insurer LIC of India is likely to sign a bancassurance agreement with Punjan National Bank. This would allow the bank to sell LIC’s products through its branch network across the country.
Mahindra & Mahindra surged 8.48% on reports the firm has slashed its planned capital spending by Rs. 500 crore as it is renegotiating contracts with vendors.
BHEL rose 2.16% on reports that it is in talks with a consortium of French nuclear technology provider Areva and Pune-based Bharat Forge for its proposed foray in nuclear forgings business.
Sensex above 8900
The market continued to scale up and closed firm above 8900 levels. Exhibiting a choppy trend in early trades, Sensex gyrated over 100 points after the opening bell and slipped below 8700 mark on sustained selling pressure to touch the day's low of 8697. Recovery started thereafter and the market rebounded into the positive territory in afternoon. Substantial buying in JP Associates, Mahindra & Mahindra, Ranbaxy Laboratories, Reliance Communications, DLF and ICICI Bank saw Sensex notch up significant gains in late trades and touch a new intra-day high of 8956. Sensex wrapped the session 187 points higher at 8944, while the 50-stock Nifty gained 58 points to close at 2777.
Market breadth, the number of advancing and declining stocks, was positive for the day. Of the 2,545 stocks traded on BSE, 1,611 stocks advanced whereas 847 stocks declined. Eighty seven stocks ended unchanged. All the 13 sectoral indices posted gains for the day. BSE Realty flared 5.35% up and BSE Oil gained 3.44%. Other sectoral indices were up 1-2% each. BSE HC and BSE IT ended in the positive territory with marginal gains.
Recovery in the market was led by JP Associates, which shot up by 8.96% at Rs77.25. Among the other major gainers, Mahindra & Mahindra advanced by 8.48% at Rs374.05, Ranbaxy Laboratories moved up by 6.82% at Rs147.95, Reliance Industries added 3.45% at Rs1,327, DLF scaled 6.16% at Rs161.95 and ICICI Bank jumped 4.52% at Rs322.65. Select index stocks witnessed selling pressure. Sun Pharmaceutical Industries dropped 2.05% at Rs1,000.85. Maruti Suzuki India fell 1.90% at Rs698.85, Grasim Industries declined by 1.03% at Rs1477.90, Infosys Technologies lost 0.62% at Rs1,288.25 and Reliance Infrastructure slipped 0.41% at Rs464.75.
Over 2.09 crore shares of Reliance Natural Resources Ltd (RNRL) changed hands on BSE followed by Unitech (1.38 crore shares), Pennar Industries (1.32 crore shares), Satyam Computer Services (1.20 crore shares) and Suzlon Energy (97 lakh shares).
Sensex up nearly 10% in three trading sessions
Firm global markets helped the domestic bourses log on gains for the straight third day. Index heavyweight Reliance Industries (RIL), realty, FMCG, metal, banking and auto stocks led the rally. The BSE 30-share Sensex jumped 186.93 points, or 2.13%.
But the market was volatile. Signs of a recovery in the domestic economy, buying by foreign funds and higher Asian stocks
lifted the domestic bourses at the onset of the trading session. But the market soon came off the day's high as investors resorted to profit taking after last week's solid gains. The Sensex had jumped 5.17% in the week ended 13 March 2009, boosted by a strong global rally in world markets.
After hitting the day's low in mid-morning trade, the Sensex soon recovered in choppy trade. The market extended gains later as European markets, which opened after Indian market, surged.
The corporate advance tax payment for the fourth installment of 14 March 2009 is a mixed bag. As per reports RIL paid lower tax for the fourth installment. State Bank of India, Tata Steel and Bank of India have paid higher advance tax whereas Indian Oil Corporation has made a sharply lower advance tax payment. Tata Motors made no advance tax payment in Q4 March 2009 while Tata Consultancy Services paid lower advance tax.
Advance tax payment gives indication on the outlook on earnings. Thus if a company pays higher advance tax, it could indicate a good financial performance for the quarter and vice versa.
Companies have to pay 25% of their annual tax bill in the March installment. Despite the economic slowdown, the Income Tax department expects advance tax collections to be marginally better than the collections in the third quarter. Corporate India had paid Rs 45400 crore as the third tranche of advance tax by 15 December 2008, much lower than the Rs 54,900 crore companies shelled out in the third tranche a year before.
After heavy outflow over the past few days, there has been reduction in selling vigor of foreign funds. They, in fact, were net buyers on Friday, 13 March 2009. Foreign institutional investors (FIIs) purchased shares worth a net Rs 191.40 crore on Friday, 13 March 2009.
FII outflow in March 2009 totaled Rs 2084.80 crore (till 13 March 2009). FII outflow in calendar year 2009 totaled Rs 9025.80 crore (till 13 March 2009).
Meanwhile, there are signs that the stimulus packages announced by the government since December 2008 and an aggressive rate cuts announced by the central bank since October 2008 have started having some positive impact - lower interest rate have helped automobile sales rebound in the past few months. Interest rates have dropped drastically over the past few months.
A pick up in the production of consumer goods and capital goods point to a rise in investment and consumption demand. Government data released during trading hours on Thursday, 12 March 2009, showed consumer durables output rose 2.5% in January 2009, moving into positive territory after three months of decline on the back of high growth in automobile sales. The capital goods sector saw strong growth, with output rising 15.4%, led by an impressive expansion in production of machinery and equipment. The pick up in production in these two segments also indicates that there is an improvement in the credit availability to the industry.
Further, a large government spending plan may help pump-prime the economy. The economy will also get another stimulus in the form of a huge spending by the political parties for the forthcoming Lok Sabha elections. As per reports, around Rs 6,000 crore would be pumped into the system as political parties and candidates splurge on their campaign and the Election Commission pays a huge bill for conducting the election. And the main beneficiary would be the services sector that often spurs growth.
Another plus point is that prospects look bright for the Rabi harvest in contrast to the previous kharif harvest which saw coarse grains recording lower output. Agriculture remains the mainstay of the economy and if rabi output increases as has been projected, rural demand may rise in the coming months, though perhaps not as much as had been hoped.
A good news for corporate India is the extension of the deadline for buyback of foreign currency convertible bonds (FCCBs) by the Reserve Bank of India (RBI) by nine months to 31 December 2009. The central bank made the announcement after trading hours on Friday, 13 March 2009. In December 2008, the RBI had liberalised the procedure for buyback of FCCBs by Indian companies, both under the automatic and approval routes.
Under the automatic route, some of the conditions for buyback of FCCBs were: value of the FCCB should be at a minimum discount of 15% on the book value; the funds used for the buyback should be out of existing foreign currency funds held either in India (including funds held in EEFC account) or abroad and/or out of fresh ECB raised in conformity with the current ECB norms.
Buyback FCCBs will help companies reduce liabilities. It will also ease concerns about the impact of foreign exchange fluctuations in the profit & loss account, to the extent of the reduction of the FCCBs. The recent steep slide in the rupee will increase in the cost of servicing overseas debt to the extent of the rupee's slide unless the company (which has overseas borrowings) has adopted an effective hedging strategy.
The sharp slide in rupee will also raise import costs for a number of Indian firms unless the companies adopts an effective hedging strategy. For those importers which also export, the negative impact will be lower. However, at a time when exports are slumping the cushion for such firms will be limited.
On the flip side, the rupee's fall will boost the topline of IT firms in terms of the domestic currency as IT companies derive a lion's shares of revenue from exports. Further, some exporters may also benefit as the weak rupee makes their products cheaper for the importer. As per reports, some of the top global retailers have placed orders worth Rs 700 crore for Indian textiles in the current calendar year so far.
European shares rose for a fifth straight session on Monday, led higher by financial stocks, as investor sentiment improved following further assurances over the health of the US banking sector. The key benchmark indices in France, Germany and UK were up by between 2.06% to 2.38%.
Asian stocks struck a one-month high on Monday as reassurances over the health of the US banking industry sparked a broad recovery in investor appetite for risk. Key benchmark indices in China, Hong Kong, Singapore, Taiwan and Japan rose by between 0.56% to 3.6%. South Korea's Seoul Composite fell 0.05%.
Executives from Citigroup, Bank of America and JPMorgan Chase said last week their banks had been profitable for the first two months of the year.
Trading in US index futures indicated the Dow could rise 79 points at the opening bell on Monday, 16 March 2009. US Stocks stayed positive for the fourth straight day on Friday, 13 March 2009, with the Dow gaining 54-points. Nasdaq and S&P 500 each rose about 5 points.
The global financial crisis has prompted governments from the US to China and Japan to widen measures to stimulate growth. Federal Reserve Chairman Ben S. Bernanke on Sunday, 15 March 2009, said the risk of depression has been averted.
Group of 20 finance ministers meeting at the weekend pledged to combat the global recession and restore the financial system to health. The key priority now is to restore lending, a G- 20 statement on 14 March 2009 said.
The Bank of Japan is considering buying subordinated debt from banks, the Nikkei reported today. The purchases may help the banks offset losses caused by write-downs on shareholdings and bolster their capital, the report said.
The BSE 30-share Sensex was up 186.93 points, or 2.13%, to 8,943.54, its highest closing since 26 February 2009. At the day's high of 8,955.73, the Sensex gained 199.12 points in late trade. At the day's low of 8,697.46 Sensex was down 59.15 points in mid-morning trade.
The S&P CNX Nifty was up 58 points, or 2.13%, to 2,777.25.
The BSE clocked a turnover of Rs 3,490 crore, higher than Rs 3,230.11 crore on Friday, 13 March 2009.
Nifty March 2009 futures were at 2777.40, near the spot price of 2777.25. Turnover in NSE's futures & options (F&O) segment increased to Rs 48,027.96 crore from Rs 47,689.67 crore on Friday, 13 March 2009.
The BSE Sensex has risen 783.14 points or 9.59% in the past three trading sessions from a 3-year closing low of 8,160.40 on 9 March 2009. Yet, the Sensex is down 703.77 points or 7.29% in calendar 2009 from its close of 9,647.31 on 31 December 2008. The S&P CNX Nifty is down 181.90 points or 6.14% in calendar 2009 from its close of 2,959.15 on 31 December 2008.
The market breadth, indicating the overall health of the market, was strong on BSE with 1622 shares advancing as compared with 879 that declined. A total of 62 shares remained unchanged.
The BSE Mid-Cap index (up 2.28%) and BSE Small-Cap index (up 2.2%), both outperformed the Sensex.
All sectoral indices on BSE logged gains. The BSE Realty index (up 5.35%), the BSE Oil & Gas index (up 3.44%), the BSE Bankex (up 2.86%), the BSE PSU index (up 2.84%), the BSE FMCG index (up 2.73%), the BSE Consumer Durables index (up 2.72%), the BSE Metal index (up 2.37%), the BSE Capital Goods index (up 2.26%) outperformed the Sensex.
The BSE IT index (up 0.4%), the BSE Healthcare index (up 0.81%), the BSE TECk index (up 1.73%), the BSE Power index (up 1.78%), the BSE Auto index (up 1.82%) underperfomed the Sensex
From the 30 share Sensex pack, 25 stocks gained while rest fell.
India's largest private sector company by market capitalization and oil refiner Reliance Industries (RIL) rose 3.45% to Rs 1,326.60. Reports suggest that the company might propose to sell or lease out its 1,432 petrol pumps to Indian Oil Corporation (IOC), even as it will start reopening its outlets, shut a year ago today, 16 March 2009. Meanwhile, as per reports, RIL's advance tax payment fell 16.47% to Rs 370 crore in Q4 March 2009 over Q4 March 2008.
PSU OMCs rose on slide in crude oil prices. BPCL, HPCL and Indian Oil Corporation rose by between 2.96% to 8.3%. Lower oil prices will reduce under-recoveries at the state-run oil firms on domestic sale of petrol, diesel, LPG and kerosene at a controlled price.
Oil prices fell to near US$44 a barrel in Asia on Monday after Organisation of Petrleum Exporting Countries (OPEC) decided not to cut production levels at its meeting over the weekend in Vienna.
FMCG stocks rose on defensive buying. Marico, Nestle India, Hindustan Unilever, ITC, United Spirits rose by between 1.15% to 6.2%.
India's largest electric equipment maker by sales Bharat Heavy Electricals rose 2.16% on reports it is in talks with a consortium of French nuclear technology provider Areva and Pune-based Bharat Forge for its proposed foray in nuclear forgings business.
Rate sensitive real estate shares rose on hopes lower rates will spur housing demand. DLF, Indiabulls Real Estate, Akruti City and Housing Development & Infrastructure rose by between 2.43% to 19.5%. Most of the realty deals including sale of commercial property and housing sales is driven by finance.
India's largest copper maker by sales Hindalco Industries rose 0.35% as it is seen benefiting the most from imposition of import duty by the government on Friday, 13 March 2009. In its bid to safeguard interests of the domestic producers, the government has imposed import duty on aluminium products imported from China. Aluminium foils will attract a safeguard duty of 22% while aluminium sheets will attract a duty of 35% with both applicable for 200 days. Safeguard duties are typically imposed over shorter time periods to protect the domestic industry from cheap imports.
Lately, the Indian markets had been flooded with cheap import of aluminium products from China thereby threatening the domestic producers who are already under pressure due to the demand slowdown and sharp fall in aluminum prices.
India's largest steel maker by sales Tata Steel rose 1.29% as its advance tax payment rose 92.41% to Rs 406 crore in Q4 March 2009 over Q4 March 2008. Other metal stocks, National Aluminum Company, Sterlite Industries and Hindustan Zinc rose by between 0.51% to 4.29%.
India's second largest steel maker by sales Steel Authority of India rose 2.2% on reports the company's sales may improve in the current quarter.
Auto shares rose on hopes lower interest rates and fall in fuel prices would spur demand for vehicles which is mainly driven by finance. India's largest commercial vehicle maker by sales Tata Motors rose 2.97%. The company did not pay any advance tax in Q4 March 2009 compared to Rs 75 crore in Q4 March 2008. India's largest motorbike maker by sales Hero Honda Motors rose 0.33%. But India's largest car maker by sales Maruti Suzuki India fell 1.9%.
India's largest tractor maker by sales Mahindra & Mahindra spurted 10.79% on reports the firm has slashed its planned capital spending by Rs 500 crore as it is renegotiating contracts with vendors.
Banking shares gained on rally in bond yields and on hopes lower interest rates may boost lending growth. India's largest private sector bank by net profit ICICI Bank rose 4,52%. Its American depository receipts (ADR) was up 0.34% on Friday, 13 March 2009.
India's second largest private sector bank by operating income HDFC Bank rose 1.2% as its ADR rose 3.66% on Friday.
India's largest bank in terms of assets and branch network State Bank of India rose 3.65% after its advance tax payment jumped 27.64% to Rs 1810 crore in Q4 March 2009 over Q4 March 2008.
Bank of India rose nearly 3% on reports it had paid advance tax of Rs 590 crore in Q4 March 2009, sharply higher than Rs 191 crore in Q4 March 2008.
Bond yields tumbled after the central bank announced a larger-than-expected buyback auctions after rejecting all bids at Friday's debt sale. The 8.24% bond maturing in 2018 was at 6.37%, compared with its previous close of 6.80%. The central bank said on Friday it would buy back Rs 20000-crore government bonds via auctions this week.
Lower bond yields or higher bond prices (the two are inversely related) will result in appreciation in the value of the bond portfolio of banks.
Outsourcing focussed IT firms gained on a recent sharp slide in a rupee. Meanwhile Infosys chief and co-founder Mr S Gopalakrishnan said on Sunday, 15 March 2009, the Indian IT industry would tide over the current downturn and might surpass the US in terms of having the largest number of IT professionals in the world in the next three years.
India's largest software services exporter by sales TCS rose 2.62% even as the company's advance tax payment fell 54.3% to Rs 53 crore in Q4 March 2009 over Q4 March 2008. The company said its promoter Tata Sons has pledged more than 12.06 crore shares or 12.33% of the equity capital of the firm.
TCS had Thursday, 12 March 2009, said it signed a multi-year IT solutions contract with German semiconductor maker Infineon Technologies AG, one of the leading semiconductor manufacturers. The financial details were not disclosed.
India's fifth largest IT major by sales HCL Technologies rose 5.62% on securing a contract worth $350 million.
India's third largest software services exporter, Wipro rose 1.65%. Recently its unit Wipro Infotech won an outsourcing contract worth Rs 1,182 crore from the Employees State Insurance Corporation (ESIC). Its ADR jumped 2.8% on Friday.
But, India's second largest software services exporter Infosys Technologies fell 0.62%.
The Indian rupee was volatile. The partially convertible rupee was at 51.32 per dollar, off a high of 51.33, its strongest since 27 February 2009 and above its previous close of 51.48/50. The rupee had hit a record low beyond 52 a dollar recently. A weak rupee boosts revenues of IT firms in rupee terms as IT companies earn a lion's share of revenue from exports.
India's largest telecom services provider by sales Bharti Airtel rose 2.37% on reports the company will restructure its businesses into nine verticals under different chief executives, as it looks to expand into areas beyond its mainstay, voice telephony. It has already identified some of these verticals such as mobile commerce, entertainment, media, internet, enterprise services and small & medium businesses. The company will also announce a new reporting structure that will give these new business divisions flexibility and independence to innovate, develop and implement new technologies to address changing demands of customers, reports added.
India's second largest telecom services provider by sales Reliance Communication surged 6.74%. Reports suggest US-based American Tower Corporation is set to acquire Xcel Telecom, a telecom tower infrastructure firm founded by former BPL Mobile chief. Last month, there were rumours that ATC may buy a 20% stake in Reliance Communication's (RCom) tower unit 'Reliance Infratel'.
Aviation stocks rose after domestic air travel shown some revival signs after several months of double digit falls. Kingfisher Airlines, Jet Airways and SpiceJet rose by between 3.15% to 17.16%. Domestic passenger traffic rose to 33.36 lakh in February 2009 compared to 33.26 lakh passengers flown in January 2009. However, passenger traffic saw an 8% fall in February 2009 over February 2008.
Ingersoll-Rand India was locked 20% upper limit at Rs 245.70 after the company said its board will meet on 24 March 2009 to consider buyback of equity shares.
EID Parry rose 18.37% after the company declared an interim dividend of 500%
Reliance Natural Resources clocked the highest volume of 2.09 crore shares on BSE. Unitech (1.38 crore shares), Pennar Industries (1.32 crore shares), Satyam Computer Services (1.2 crore shares) and Suzlon Energy (97.53 lakh shares) were the other volume toppers in that order.
Akruti City clocked the highest turnover of Rs 297.78 crore on BSE. Reliance Industries (Rs 233.09 crore), ICICI Bank (Rs 189 crore), Reliance Infrastructure (Rs 186.56 crore) and Educomp Solutions (Rs 175.65 crore) were the other turnover toppers in that order.
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