When there is no peril in the fight there is no glory in the triumph.
The bulls of course may be knowing this axiom, for they have fought back quite well after the August meltdown and the P-Note scare last month. The rebound that we hoped for didn't materialise yesterday. The local bulls developed cold feet amid renewed worries over the subprime mortgage contagion in the US and its fallout on the global markets. However, there is a chance that the bulls might just have enough stamina in them to stage a comeback today. The overall trend will remain choppy as FII inflows have slowed in the past few days and fresh bad news pours in from the US housing and financial sectors.
Traded volume may be lower as most players are in a holiday mood ahead of an extended weekend on account of Diwali. Select stock centric, and in some case sector specific action will continue to be the order of the day. Investors should do well to remain on guard amid heightened volatility and lack of clear direction. But, that's just for the near term. There is no change in the positive outlook over the longer term period. So, one should prepare oneself to ride the secular bull run in the Indian market. Today, we expect a higher opening as Asian markets have bounced back from yesterday's big fall.
Hotel stocks will gain as a financial daily reports that the Government is likely to give 5-year income-tax holiday to star and budget hotels. Bajaj Auto will be in action post its tie-up with Austria-based KTM. M&M is another stock to keep an eye on as it is believed to be the frontrunner for acquiring Italy's gear maker Metalcastello. Unitech and Orissa Sponge will attract attention amid reports that the realty major's promoters are close to buying a 40% stake in the company as a backward integration plan. Biocon may perk up on acquisition news. TIL (formerly Tractors India) might advance as a pink paper reports that Enam Capital has bought nearly 12% in the Kolkata-based company. Eicher Motors may rise amid reports that it is in talks with various players for strategic partnership for heavy commercial vehicles. Power companies like Torrent, Reliance Energy and Tata Power will extend their rally amid news that they are bidding for the 2,000 MW project in Gujarat. Dawn Mills is expected to be in the limelight after a business daily reports that Standard Chartered close to buying two lakh square feet of space in the Lower Parel, Mumbai-based mill. Glenmark Pharma and SKF India could gain ahead of some announcements expected tomorrow.
A weak opening ended with a negative close as shaky cues from the Asian and the European markets coupled with selling pressure in the Banking, Oil & Gas and IT stocks dragged the key indices lower.
Markets further lost ground in the second half as selling intensified, however managed to recoup towards the end with benchmark Sensex slipping 385 points to close at 19,590 and Nifty lost 85 points lower at 5,847.
Hotel Leela rallied by over 8.5% to Rs50 after reports stated that Blackstone, US-based PE, may invest Rs50bn in the company. The scrip touched an intra-day high of Rs55 and a low of Rs47 and recorded volumes of over 62,00,000 shares on NSE.
Jet Airways advanced 1% to Rs830 after the nation's largest domestic carrier announced on November. 2 that they would raise the fuel surcharge by Rs150 on all types of fares. The fuel surcharge would be raised to Rs1,350 per ticket. The scrip touched an intra-day high of Rs846 and a low of Rs822 and recorded volumes of over 59,000 shares on NSE.
M&M was down by 1.4% to Rs744. The company on November 2 announced that
Hindustan Zinc slipped 2.6% to Rs861. The company announced that they have lowered prices of zinc and raised prices of lead. Zinc prices were cut by 2.9% to Rs127,300 per metric ton. Lead prices were raised by 0.3%, to Rs160,900 per ton. The scrip touched an intra-day high of Rs884 and a low of Rs855 and recorded volumes of over 76,000 shares on NSE.
Power Grid advanced 2% to Rs152 after reports stated that the company secured Rs42bn mega transmission project. The scrip touched an intra-day high of Rs155 and a low of Rs148 and recorded volumes of over 21,00,000 shares on NSE.
Raymond was up 4.2% to Rs369 after the Board of Directors of the company announced that they would consider selling warrants to founders. The scrip touched an intra-day high of Rs381 and a low of Rs351 and recorded volumes of over 3,00,000 shares on NSE.
Jindal Drilling surged by over 5.5% to Rs1101 after the company announced that they have secured Rs103cr contract. The scrip touched an intra-day high of Rs1190 and a low of Rs1060 and recorded volumes of over 11,000 shares on NSE.
Reliance Communication slipped 1% to Rs777. The company formed an Internet TV partnership with Microsoft. The scrip touched an intra-day high of Rs799 and a low of Rs762 and recorded volumes of over 90,00,000 shares on NSE.
Jyoti Structures gained 2% to Rs284 after the company on Monday announced that they have formed a Joint Venture Company, Jyoti Structures Africa (Pty) Ltd. in Johannesburg, South Africa to participate in the transmission line markets of Southern Africa. The scrip touched an intra-day high of Rs293 and a low of Rs279 and recorded volumes of over 78,000 shares on NSE.
RCom has tied up with Microsoft for launching of IPTV by March at an investment of US$1bn.
HPCL is planning to buy British Gas's stake in Mahanagar Gas.
Bajaj Auto has picked up 14.5% stake in European Bike maker KTM for Rs3-3.5bn.
M&M is believed to have put a bid of €105mn to take over Italian gear maker Metalcastello.
TCS is building a cabin crew software for management solution for British Airways.
Biocon is close to acquiring a drug marketing and distribution firm in US by the year end.
Emami is all set to launch its hair care products in the next six months.
Unitech is planning to buy 40% stake in Orissa Sponge Iron and Steel.
Enam Capital is picking up 11.8% stake in proposed expanded capital base of TIL.
Deccan Aviation has formed a consortium for bidding of airport projects.
Leading PE firms including Warburg Pincus, Blackstone, and StanChart Private Equity are vying for 32% stake in Sony Entertainment Television.
Pidilite is set to acquire plant and machinery of an international specialty company for Rs4.5bn.
Madras Cements is setting up one million tonsa year grinding unit in West Bengal.
Sun TV is launching two FM radio stations in Lucknow and Bhopal from Tuesday.
ICICI Bank has sold ~45% of its sticky home loans to the Asset Reconstruction Company of India.
Videocon Industries has acquired Planet M for Rs2bn and plans to invest Rs5bn to set up 1,000 stores.
Reliance Industries plans to set up a manufacturing facility in specialized apparel for its flagship brand Vimal.
Dabur group is planning to launch ~10 skincare products under its Gulabari brand.
Tata Coffee expects ~12% increase in production at over 8,500 tons during Oct-Sept 2007-08.
TVS has launched a 110cc bike StaR City priced between Rs34,000-Rs39,000.
Standard Chartered is close to acquiring 2 lakh Sq. Ft. in Piramal group owned Dawn Mills for Rs5.25bn.
Telecom Ministry says the new policy on licenses and spectrum allocation will apply to only those companies who applied before September 25.
Government is planning to curb ability of domestic companies to allot preferential shares to overseas partners and investors.
Government will consider allowung 49% FDI in new refineries to be setup by state-run refiners.
Government is planning to offer a five year income tax holiday to five-star, three-star, two-star and budget hotels.
Direct tax collection during April-October 2007 rise by 24% to Rs1.28 trillion.
Government is planning to allow certain SEZs and EOUs to avail benefits provided to exporters to combat a rising rupee.
The auto industry is asking the government to bring auto exports under the DEPB scheme.
DoT is planning to change the definition of broadband in accordance with international norms and raise the minimum download speed from 256kbps to 2Mbps.
Private investment in infrastructure in India is poised to grow to about 9% of GDP from 5% by 2012.
Petroleum minister Murli Deora will meet the Prime Minister on Nov 7 to discuss oil price hike.
FII Investment Trend:
FIIs were net sellers of Rs10.93bn (provisional) in the cash segment on Monday while the local institutions pumped in Rs6.49bn.
In the F&O segment, FIIs were net sellers of Rs4.32bn.
On Friday, FIIs were net sellers of Rs7.61bn in the cash segment. Mutual Funds were net buyers of Rs2.18bn on the same day.
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