Saturday, September 8, 2007
Weekly Close: Decoupling week.. or was it ?
There are many who believe that a recession may be on cards in the US. In fact, by the time we write this the US unemployment data seems to be pointing to a worsening situation. There was an interesting article from Gavekal which gives reasons to the otherwise mentioned in our note "Economy : Taking stock today." The argument is that the US consumer is extremely dependable and companies have lot of cash and also making profits. The firing of people seems less likely and hence lesser chance of a recession.
Market performance this week was positive: Sensex closed up 1.7% up; Nifty 1% up; Mid caps 2.5% up; Small caps 4.5% up; FMCG & Health care 3.8% up.
Auto sector is heavily banking on festive season. But this is what TVS CEO Mr Srinivasan had to say "We have been reducing our stocks in the market place specifically on Star because of the new launch planned in September. To that extent we have been reducing the stock in the market place that was rolled out on 30th of August. This quarter would be again flat but we expect the market to pick up from the festive season once the credit availability is also there in the market place. We expect that from October onwards sales will start picking up and have 7-8% growth in the next half." Interestingly Honda Motors will increase capacity to 12 lac 2 wheelers and also intends to launch 3-4 models including a 100 cc bike. Bajaj is in the news the Maharashtra Government is worried about its plant closure in Akurdi. Bajaj will be paying the 2700 odd workers in any case. Another statement by Mr Ravi Kant, CEO of Tata Motors says that they do not expect a pick up in demand this season because of higher interest rates. Maruti has extended its price discounts to ensure higher off take. Really, all in all, the news are not encouraging. Lower interest rates are what could be the catalyst. With inflation lower, may be we could hope for that.
This week Eveready reported that it would issue 45 lac warrants for Rs 58. Interesting to note that in Nov 2005 the company had issued 67 lac warrants to the Promoters with an execution price of Rs 95. The Management had paid up 10% of that amount upfront. Also interesting to note that around 9 lac warrants were converted at Rs 95. With the Zinc rallying, profitability was hit and the stock crashed to 45 levels leaving losses on the table for the Promoters and useless warrants in hand. This set of warrants will lower the price of the acquisition and makes more sense. The other set of warrants will not be exercised till the stock hits 85.50 (9.5 is already paid up). We need to know With Zinc at $2850 per tonne, certainly near term would be a buoyant. The warrants at 58 indicate the management?s bullishness. So probably the worst is behind us. The average six month price is Rs 55 so that?'s the reason for the pricing at Rs 58. They would have to pay 10% of this upfront to get the warrants. We are positive about the
In our discussion with Navneet we learnt more about its E-learning initiative. There are some exciting changes happening in the company. The product has been launched in Gujarat already with some initial successes. The Management is certainly more aggressive than it used to be. That's a big change. We like this one. However some negative for Educomp is that there are other players making an entry as well. Edurite (edurite.com) is a company which provides the educational content and that really would be creating some competition for Educomp. Valuations of Educomp seem to have gone through the roof and here are some reason for it to cool off and may be rub off at bit on Navneet. Await a research note on this.
Conflicting articles continue in papers about the subsidy for the shipbuilders. This issue is in debate between the Finance Ministry and the Shipping Ministry. There possibility that the subsidy may not be extended is less but there is a good chance that the subsidy limit may be reduced. Ships Manufactured in India carry a 30% government subsidy. The Industry has been pleading for the subsidy to be extended. In our discussion with the Management of ABG Shipyard, we are informed that all orders signed till August 14th is eligible for the subsidy. However this topic will take at least a couple of months to be cleared. The Parliament has to pass this. We think this will take its time unless the industry is able to lobby hard to get this off the ground quickly. An ordinance could bring in some positives. But the stocks are seeing strength as if extension is a foregone conclusion. This makes us less comfortable.
Technically Speaking: Sensex closed just above the key weekly support of 15560 levels. The uptrend seems to be buoyant and there is a good chance that we may challenge new highs as long as 15270 as a level is not breached. Volumes traded were good at over Rs 4864 cr for the day.
Stocks you can pick up
CMP: Rs 101.05
Target Price: Rs 120
Merrill Lynch has initiated coverage on Motherson Sumi Systems with a buy rating and price target of Rs 120 citing sustainable strength in earnings growth and new business ventures as among the key reasons. "We expect a 23%+ CAGR (compounded annual growth rate) in EPS (earnings per share) during FY07-FY10E (estimated) driven by 25% CAGR in revenue," the investment bank said in a note to clients.
"Expansion of rubber component business with the recent acquisition of Empire Rubber in Australia and beginning of commercial production of mobile phone plastics parts business in H2FY08 are the key growth drivers apart from the 22% CAGR in wiring harness revenue, in our view," the note said.
Transport Corp
CMP: Rs 115.25
Target Price: Rs 140
SSKI Securities has initiated coverage on Transport Corporation of India (TCI) with a buy rating and price target of Rs 140. "TCI is currently trading at 12.8 times FY09 earnings and 7.4 times FY09 EV/EBITDA (enterprise value/earnings before interest, taxation, depreciation and amortisation), which we believe is attractive, considering the sharp earnings growth trajectory and steep discount to peers," the institutional brokerage said. "Further, to emerge as one of the largest SCS (supply chain solutions) providers, TCI is also investing heavily into warehouses and trucks, which will enable TCI's SCS revenues to grow at 55% CAGR over FY07-09E," it said.
ICICI Bank
CMP: Rs 919
Target Price: Rs 1,050
While maintaining its buy rating on ICICI Bank, with a price target of Rs 1,050, CLSA said concerns about the private bank's asset-quality were exaggerated. "Concerns about the bank's rising gross non-performing loans (NPLs) are exaggerated given that most of the increase is due to the bank's higher proportion of unsecured loans, which are priced for higher defaults and have ROE (adjusted for the high risk) of about 25%," the French investment bank said. After factoring in the rise in provisions for NPLs, CLSA expects ICICI Bank's net profit to grow 30% on an annual compounded basis till 2010.
Hotel Leelaventure
CMP: Rs 44.75
Target Price: Rs 42
ICICI Direct has initiated coverage on Hotel Leela with a hold rating and expects the stock to underperform its peers in the sector due to expensive valuation. "Given the delayed expansion plans and absence in major markets till 2010, we feel Leela's current valuations have factored in the business growth till FY09," the retail brokering house said.
"Although Hotel Leela has undertaken expansion plans to New Delhi, Pune, Chennai and Hyderabad, the company is not expecting any of the fresh capacities to be operational before FY11. By 2010, the hotel sector should witness huge supplies coming in at major cities resulting in rationalisation of average room rates (ARRs) and cooling down of the occupancies," it said.
Phillips Carbon
CMP: Rs 168.75
Target Price: Rs 213
Angel Broking has initiated coverage on Phillips Carbon Black with a buy recommendation and 12-month price target of Rs 213. "We expect PCBL to grow at a CAGR of 9.8% in topline (net sales) and 78.8% in bottomline (net profit) over FY2007-09E. Growth in bottomline will primarily be aided by contribution from the power division as it will reduce costs as
well as provide additional source of revenue with 85-90% EBITDA margin (operating margins)," the broking house said in a note to clients. Angel estimates Phillips' EPS in 2007-08 at Rs 21.7, as against Rs 9.4 in 2006-07. In 2008-09, the company's EPS is expected to be Rs 26.6.
Go long to cut subprime losses
Investors in high-retail exposure sectors like IT, construction, automobiles and banks will have to stay invested long-term, if they want to exit without logging losses.
ET conducted a sample study on various sectors over the past three months to analyse the impact of subprime crisis on Indian stock markets. As predicted by market mandarins, the crisis has not impacted the market in toto; only stocks in sectors that previously attracted huge foreign institutional investors (FII) interest have been hit , owing to pull-outs and redemption by foreign investors.
"Subprime fears have been factored in by Indian investors. There is nothing that can link India to the US subprime zone. The market witnessed some downtrend during the subprime days; but that was just because of prevailing negative sentiments in global markets. Now is the time to buy good stocks. They should, however, be cautious in their approach," Indiabulls Securities CEO Divyesh Shah said.
According to market watchers, sugar is one sector that has not been hit by the subprime at all. As a matter of fact, the sector has not been doing well over the past six months. Sugar stocks are taking a beating on fears that the sugar market is in for a surplus for next two seasons.
Secondly, sugar being a commodity is expected to have peaked in its upward trajectory in 2007. Locked-up investors should exit sugar stocks on the upside. If they are entering sugar stocks now, they should be ready to hold them for at least 3-4 years.
The only positive trigger that can propel the sector is a surge in crude prices to around $85 per barrel. This will ease global sugar prices and increase demand as most big producers would then get back to ethanol production, sugar analysts said.
Construction & realty sector has fallen nearly 7% over the past 33 trading sessions. Construction, analysts said, was one sector that was badly pounded as a result of the subprime worries.
Though indirect ripples could not be ruled out, subprime should not affect Indian real estate sector as much as it impacts European countries and the US. There may be some blips or dips in real estate sector as it is closely related to mortgage loans; infrastructure sector looks perfectly fine.
As far as India is concerned, the construction sector would continue to do well in the long term. The sector should do well once inflows start strengthening, experts said. "To be on the safer side, investors can overlook real estate stocks for some time; infrastructure companies look good even in these market conditions," said a fund manager of a domestic mutual fund house.
IT shares are still not very encouraging as the sector continues to be linked to the irregular currency movements. Though, most analysts believe, IT companies would come out with decent earnings figures in the third quarter, there is still an air of apprehension among investors.
Broking houses are advising investors to value-buy frontline IT stocks. Sectors like hospitality, logistics, banks and automobile, too have not really managed to participate in the post-sub prime rally. All these sectors are down in the range of 3% to 6% since July 24.
Weekly Newsletter
With the Federal Reserve Chairman Ben Bernanke expressing his willingness to cut rates to stabilise the markets, other central banks continued their efforts in restoring investor confidence and ease the liquidity squeeze. As expected, the European Central Bank (ECB) and the Bank of England (BOE) maintained a status quo on interest rates so did central banks in Brazil, Australia, Canada and South Korea. But, the People's Bank of China hiked the reserve requirement for banks yet again to cool down the overheated economy. The central bank in Sweden raised a key rate by a quarter percentage point to quell inflation.
Not only did the central banks decided to hold rates steady, they also injected cash to combat the liquidity crunch arising out of the meltdown in the US housing sector, especially the subprime mortgages. The ECB added €42.2bn (US$57.7bn) in emergency cash to ease a credit drought that had pushed overnight deposit rates to a six-year high. The BOE offered extra money to reduce unusually high overnight rates. Australia's central bank said it will buy debt backed by home loans to add cash to the financial system. Central banks have added more than US$400bn to money markets since Aug. 9 to ease lending between banks.
The BOE issued an accompanying statement, signalling its awareness of market conditions. It was only the third time in the decade-long history of the bank's policy-setting body had done so while holding rates on hold (the last occasion being May 1999). ECB president Jean-Claude Trichet signaled that no rate increase was likely next month either, and added that providing extra liquidity was essential as an element of confidence. He promised the ECB would provide funds at whatever price at whatever interest rates the market has to function.
The Organization for Economic Cooperation and Development (OECD) cut its forecasts for US and European economic growth and said they may be reduced further following the rout on financial markets. The ECB too reduced its forecast for growth in Europe this year, and warned that continued volatility in financial markets could dampen its projections further. Meanwhile, China asked its banks to set aside more money as reserves to cool lending and investment after inflation accelerated to a 10-year high. The reserve ratio will increase 0.5% to 12.5% on yuan deposits starting Sept. 25. The ratio is now the highest in almost 10 years.
Bajaj-TVS spar over engine technology
A major fight broke out between two-wheeler majors Bajaj Auto and TVS Motor over the use of twin spark plug technology. While Bajaj Auto accused TVS of stealing its so-called 'DTSi' technology used extensively across bikes, TVS shot back saying the technology has been known for years, and therefore cannot be a proprietary technology of Bajaj Auto. Countering Bajaj Auto's charges of technology infringement, TVS said it would press libel charges against its Pune-based rival for making malicious allegations, and insisted that the latter withdraw all the charges against it.
Last week, TVS introduced seven new products, including a new 125 cc bike, called Flame. This led to Bajaj Auto threatening legal action against its smaller rival for what it said was a violation of intellectual property rights. Though the engine of Flame is of a similar size and employs the twin spark plug technology, TVS said its technology does not infringe Bajaj Auto's patent in any way. TVS said the concept of using twin spark plugs in motorcycles is old and existed even before Bajaj Auto introduced it in India. TVS said it has developed the CC-VTi engine in association with Austrian company AVL.
TVS filed an application for revoking Bajaj's DTSi patent, and Bajaj Auto said it has received the Chennai-based manufacturer's application seeking to revoke its patent. "If our IPR is violated, we shall defend it," Bajaj Auto chairman Rahul Bajaj said. On the other hand, TVS Chairman Venu Srinivasan said, "We are taking the advice of our counsel." He, however, declined to comment on the company's future course of action. Meanwhile, Bajaj Auto MD Rajeev Bajaj said the company would wait for TVS' Flame to be out in the market to decide on its future course of action.
On the business front, TVS said the launch of Flame (initially scheduled for November) is on course for October launch. Bajaj Auto, Meanwhile is busy preparing for the launch of its much hyped new 125 cc bike, 'Exceed' over the coming weekend. Separately, a media report indicated that Srinivasan and Rajeev Bajaj may have decided to burry the hatchet at a closed-door meeting at the SIAM Annual convention in New Delhi. Still, with competition in the sector getting stiff and stakes being so high, it remains to be seen whether the two companies will end up in court or decide to go for an out-of-court settlement.
Market up for 3rd straight week
Despite the slight fall on the last trading day of the week, the key indices managed to rise for a third week running, putting behind last month's crash due to the global market meltdown and concerns on the political front. The benchmark Sensex added 1.8% or 271 points to close at 15590 and the NSE Nifty advanced by 1% or 45 points to 4510.
Power, Banking, FMCG, Pharma and Cement stocks led the rally on the bourses. The small-cap stocks continued their dream run with the BSE Small-Cap Index hitting an time high of 8289.81 during the week. The Indian bulls managed to overcome the recent misery on the back of buying from both FIIs and MFs.
The 14 new entrants in the F&O segment had a terrific debut, as institutions rushed to take positions in these stocks. Reliance Capital and BNP Paribas acquired 2.2 lakh and 1.2 lakh shares, respectively of LMW at Rs2925. Others like Aptech, Bhushan Steel and NIIT Tech also had a good run over the week.
Value buying was seen in FMCG shares with HUL and ITC leading from the front. Also, expectations of good quarterly numbers next month have been driving interest in these counters. ITC surged by over 4% to Rs177, Hindustan Unilever advanced by 2.5% to Rs213 and Tata Tea gained 1.1% to Rs761.
Strong set of monthly sales by cement companies and buoyant domestic demand helped cement stocks record concrete gains. Also, there were reports that Pakistan has raised the prices of cement, helping ease concerns of cheaper cement entering India. There was also talk of a fresh round of price hike in the local market post monsoon. Grasim climbed by over 8.5% to Rs3182, Ambuja Cements rose by over 5% to Rs140 and ACC added 2% to Rs1086. Among the Mid-Cap stocks Kesoram, India Cements and Mangalam Cement were the major gainers.
Power stocks continued their winning streak led by gains in REL, NTPC and Tata Power. REL rose on reports that the company may sell shares in the new engineering unit. NTPC also had a good run as the Government plans to divest 4.75% of its stake in the company. REL was the top gainer in the Sensex. The scrip rose over 9% to Rs850. NTPC jumped by over 8% to Rs187 and Tata Power surged by over 5% to Rs718.
Banking stocks had another good week, as speculation increased about a possible rate cut by the Fed. The BSE Banking index gained 3.2% on the week. Mid-Cap stocks were in the limelight. Dena Bank, Axis Bank and Bank of Rajasthan were among the top gainers. ICICI Bank rose over 3.5% to Rs920, HDFC Bank gained 2.1% to Rs1196 and SBI added 1.2% to Rs1620.
Sensex eyes 16k
That we are heading towards 16k on the Sensex is sure now, with the market rebounding sharply over the past three weeks. The big question is how much more time it will take for the Sensex to get there and will the market sustain for long above that level. There could be a few hiccups before the main indices hit their new lifetime highs. But, nothing to unduly worry about, as renewed buying from FIIs will ensure that they will get there as early as next week. Still, one should not get carried away by these statistical events, as they tend to distract attention from the critical issue, which is to focus on one's personal holdings. Last time the bulls hit historic highs, the fall from grace proved to be too tough for them. The current momentum suggests that the same may not get repeated, though one has to keep a close eye on global developments as well as the developing political situation in the country. All eyes and ears are on the Federal Reserve. The American central bank is expected to move swiftly to prevent a recession but the moot point is whether it will be enough? Investors should continue to be wary of any rise and play safe by booking some profits. A correction is overdue as the valuations look expensive and there are no major positive triggers.
Govt says 28 FIIs issuing participatory notes as on Jul 31; Notional value of P-notes issued by 5 FIIs at $ 51 bln on July 31
Gitanjali Gems launches IT company
The subsidiary will be essentially engaged in web development, infrastructure management and enterprise resource planning (ERP). Explaining the rationale behind the move, Sam George, director, Ivida Technologies, said, "The company intends to tap opportunities in the retail boom and the IT sector in general."
He also mentioned that technology will play a key role in Gitanjali's expansion plans as the company is looking at automating all its retail operations.
Apart from addressing the IT requirements of the group company, the subsidiary will also cater to its independent clients. George said, "The company has bagged some US-based jewellery clients for the web portal operations. We are also in talks with companies to be their enterprise resource planning (ERP) partners in India." He further said that the third area of immediate concern for Ivida would be hardware and networking.
The company is also looking at partnering with solution providers like JDA, SAP and others for specific retail solutions. Subsequently, Ivida also aims to focus on media and graphics and knowledge processing outsourcing operations. Currently, it has a team of 30 people, which would be scaled upto 75 by the end of the first operational year.
Brokerage Recomendations
Buy Unichem Labs, target Rs 286: Karvy
Buy Kesoram Industries, tgt Rs 697: Motilal Oswal
M Stanley an overweight on Cairn India
Buy Sintex Industries: Edelweiss
Buy M&M with a target of Rs 840: CLSA
Kotak Sec keeps inline rating on India Cements
Buy BHEL; target of Rs 2000: Merrill Lynch
GNFC a market performer, tgt Rs 154: HDFC Sec
Motilal Oswal neutral on L&T
Buy IFCI, target Rs 94: Dolat Capital
Buy Hotel Leela, target Rs 70: UTI Securities
Buy Bartronics India, target Rs 440: Nirmal Bang
Downside seen to be over the next 3 mnth; Nifty range 3750-4750; Sep 18 Fed decision a key driver of market sentiment: K&A Securities
About market strategy, he said that he would reduce the exposure currently but is not prudent to go short. One can see dip to 4100 in the near-term and the support is at 4060-4110. About currency, he said that the Yen-Dollar rate is seen at 130/$ over the next 6 months.
Market may turn volatile
The market is expected to see a volatile week, as the first meeting of the UPA-Left committee on the Indo-US nuclear deal is likely to take place before 14 September 2007. The meeting date is speculated to be somewhere between 10 to 14 September 2007.
The government had put on hold the operationalisation of the nuclear deal pending the findings of a committee constituted to go into the objections raised by the Left parties.
A lot will also depend on how global markets pan out. Of late, local market have been closely tracking movements in global markets.
Also caution will prevail in the global markets ahead of the US Federal Reserve meeting scheduled to be held on 18 September 2007. Marketmen speculate an interest-rate cut.
Market posted third straight gain for the week ended 7 September 2007. BSE Sensex rose 271.82 points or 1.77% to 15,590.42 while the S&P CNX Nifty rose 45.5 points or 1.01% to 4518.60.
FIIs have been on a buying drive recently. They bought shares worth a net Rs 2191.60 crore in four trading sessions from 3 September 2007 to 6 September 2007. Mutual funds were net buyers worth Rs 353.80 crore in equity market during four trading sessions from 3 September 2007 to 6 September 2007
Friday, September 7, 2007
Markets end marginally down amid volatile trade
Index Gainers were Sun Pharma up 2.9% Hero Honda up 2.4%, Nalco up 2.2%. Index Losers were Zee Ent down 3.3%, Cipla down 2.4%, Tata Motors, M&M down 2.3% each.
NSE Advance Decline ratio at 5:6. Total market turnover at Rs 53502.45 vs Rs 55494.52 cr on Thursday Inflation for week ended Aug 25 at 3.79% Vs 3.94%; market estimate at 3.89%
MARKETS THIS WEEK
Sensex went up 1.77%, Nifty went up 1%. CNX Mid-cap Index up 2.7%, BSE Small-cap Index up 4.63%. All BSE Sectoral Indices end in the green. BSE Healthcare, MCG Indices up 3.7% each BSE Bank Index up 3%, BSE IT, Cap Goods Indices up 1.5% each Pharma stocks: Sun Pharma up 8.7%, Cipla up 8.3%, Ranbaxy up 4.5%
Index Gainers; Jet Airways up 11.7%, REL up 9.1%, Grasim up 7.9%. Index Losers Bharti Airtel down 3.6%, GSK Pharma down 3%, ONGC down 1%
Midcap Gainers- Decolight Ceramics up 45%, KS Oil up 35%, GIPCO up 25% Midcap Gainers- Bank Of Raj, Noida Toll Bridge up 25% each, NIIT up 22%
CURRENCY MOVEMENT
Rupee appreciates by 25 bps at 40.69 (hits intra-day low of 40.75)
Yen appreciates by 7 bps at 115.14 (hits intra-day high of 114.91)
F&O SNAPSHOT
Nifty futures discount widens to 31 points vs 15 points as of yesterday
Nifty futures add 19.15 lakh shares in OI
Nifty futures turnover at nearly 25% of total FNO turnover
Long positions were seen in Petronet LNG, Punj Lloyd, Bongaigaon Refinery
Rolta stands out as stock has started recovering from level of Rs 410 (when recovery started)
Long unwinding seen in Realty stocks: GMR Infra, Unitech
New Entrants: Yes Bank, Tech Mah, 3i Infotech, Sasken, Tulip IT see low volumes and some profit booking
Long Positions
Liquid stocks: Petronet LNG, Punj Lloyd, Bongaigaon Refinery
Rolta up 7.5%; add 1.43 lakh shares in OI
Mid-cap Banks: Karnataka Bank, Allahabad Bank
Other stocks: Adlabs, Voltas, Divi's, SRF, Jet Airways
Long Unwinding
Realty stocks: GMR Infra, Unitech, and Lanco
Other stocks: TTML, IDBI, India Cements, SAIL, PFC, Alstom
Short Covering
GE Shipping, Crompton Greaves, Chennai Petroleum, EKC, Matrix
BUZZING STOCKS
Aptech: recent inclusion in FNO
Tourism Fin Corp: looking to infuse capital via fresh equity of shares
Bartronics: to raise $50mn via FCCBs/GDRs
NIIT: reports that NIIT looking to offload 25% stake in NIIT Tech
Bank of Rajasthan: looking to raise Rs 75-80 cr Via placement to BNP Paribas
Noida Toll Bridge: Delhi land bank in excess of 200 acres
Saregama: Reliance MF has recently picked 7% stake
LOSERS TODAY
Welspun Gujarat, Patni, GMR Infra, Aksh Optifibre, Alps, Assam Co, Tulip IT.
Small-cap, mid-cap shares outperform market
The market pared early gains as fresh selling emerged in later half of the day when European markets drifted lower. Earlier today, the market had opened on a firm note following overnight gains in US stocks as a series of mixed reports on the US economy raised investors' optimism of an interest-rate cut by the US Federal Reserve in a meeting scheduled to be held on 18 September 2007.
India's wholesale price index rose 3.79% per annum in the 12 months to 25 August 2007, lower than the previous week's 3.94% due to a decline in some food prices, government data showed on Friday, 7 September 2007. Inflation is at its lowest level since it touched 3.70% in the week ended April 15, 2006. Inflation data hit the market at about 12:00 IST.
The BSE 30-share Sensex declined 25.89 points or 0.17% at 15,590.42. It had opened higher at 15,655.37 and advanced further to hit a high of 15,716.06. The index had slipped to a low of 15,565.22. It oscillated in a range of 150.84 points in the day.
The S&P CNX Nifty shed 9.10 points or 0.20% at 4509.50. The Nifty September 2007 futures settled at 4480, a discount of 29.50 points as compared to spot closing
The market breadth which was strong throughout the day, eased at the fag end of the day. On BSE, 1,383 shares advanced as compared to 1,381 that declined, while 71 remained unchanged. This is in sharp contrast to a strong market breadth in morning when, 1264 shares advanced as compared to 305 that declined, while 24 remained unchanged.
The BSE Mid-Cap Index rose 0.04% to 6,851.65 while the BSE Small-Cap Index gained 0.45% to 8,433.52. Both these indices outperformed the Sensex
The total turnover on BSE amounted to Rs 4864 crore as compared to Rs 4,670.89 crore on Thursday, 6 September 2007. The NSE's F&O turnover was Rs 38,666.44 crore as compared to Rs 40927.51 crore on Thursday, 6 September 2007.
Most of the sectoral indices on BSE settled lower. The BSE FMCG Index (up 0.72% at 2,046.63), BSE TecK index (down 0.14% to 3,642.30), and BSE PSU index (up 0.01% to 7,288.49) outperformed the broad market.
However, the BSE Metal Index (down 0.67% at 11,609.08), BSE Bankex (down 0.19% at 8,095.69), BSE Oil and Gas Index (down 0.56% at 8,185.77), BSE Consumer Durables index (down 0.39% to 4,479.70), BSE Realty index (down 1.03% to 7,470.27), BSE Health Care Index (down 0.31% at 3,705.68), BSE Capital Goods Index (down 0.33% at 13,613.24), BSE Auto Index (down 0.97% at 4,889.83) and BSE IT Index (down 0.12% at 4,659.70) were underperformers.
From the 30-member Sensex pack, 20 slipped; the rest gained.
India's largest cigarette manufacturer by sales ITC surged 1.63% to Rs 177.50 on 17.62 lakh shares. It was the top gainer from the Sensex pack.
Hindalco Industries (up 1.32% to Rs 157), HDFC Bank (up 1.07% to Rs 1198) were the other gainers from the Sensex pack
Oil and Natural Gas Corporation, India's second-most valuable firm, rose 1.56% to Rs 850.10 as oil prices climbed above $76 a barrel as tension between Syria and Israel raised supply concerns.
State Bank of India (SBI), the nation's largest banking entity by net profit, slipped 0.91% to Rs 1617. As per reports, it will raise about Rs 1500 crore through a bond issue this week. The issue will be part of the bank's Tier II capital. The size of core issue likely to be set at Rs 1000 crore with over subscription option of Rs 500 crore.
Cipla, the country's third largest pharma company by sales, was the top loser from the Sensex pack. It slipped 2.43% to Rs 180.50 on 6.39 lakh shares.
TCS, India's biggest software exporter by revenue, came off the lower level of Rs 1070.20 after Chief Operating Officer N. Chandrasekaran said the outlook for deals is good and the company sees no adverse impact from the US subprime crisis. The stock was down 0.07% to Rs 1076.20.
ICICI Bank, India's biggest private sector bank by net profit slipped 1.01% to Rs 911.05. As per reports, it is setting up a $2-billion infrastructure fund.
Auto shares declined on profit booking. Tata Motors (down 1.80% to Rs 699), Bajaj Auto (down 0.26% to Rs 2327), Mahindra & Mahindra (down 2.10% to Rs 707), and Maruti Udyog (down 0.98% to Rs 873.15) edged lower.
India's largest private sector entity by market capitalisation and oil refiner, Reliance Industries (RIL), was down 1.29% to Rs 1957.70 on 5.09 lakh shares as its gas pricing formula from the Krishna-Godavari basin faced oppositon from the CPM politburo and Samajwadi Party. The Union fertiliser minister Ram Vilas Paswan said the price ($ 4.33 per million British thermal unit) sought by RIL for the gas it plans to produce from KG block next year is unrealistic.
Aptech (Rs 126.64 crore), Reliance Industries (Rs 100.67 crore), Welspun Gujarat Stahl Rhoern (Rs 95.05 crore), Oil & Natural Gas Corporation (Rs 91.96 crore), and IFCI (Rs 84.23 crore) were the turnover toppers on BSE.
Among the side counters, Elpro International (up 20% to Rs 241.20), Murali Agro (up 20% to Rs 950.40), Triveni Glass (up 20% to Rs 35.70), Uni Abex Alloys (up 20% to Rs 293.10), Hester Pharma (up 18.97% to Rs 153.95), Roto Pumps (up 18.63% to Rs 73.85), BPL (up 20% to Rs 59.50) and Zuari Industries (up 12.11% to Rs 288) surged.
Saregama India jumped 6.75% to Rs 323. The stock has been on a roll since Sonata Investments acquired 10.58 lakh shares of the company at Rs 260 per share in a block deal on Tuesday, 4 September 2007, on BSE. The stock surged 21% in the previous two trading sessions from Rs 250.10 on 4 September 2007 to Rs 302.60 on 6 September 2007.
Hindoostan Spinning & Weaving Mills jumped 10% at Rs 64.75. It surged 15.60% in the previous three trading sessions from Rs 50.95 on 3 September 2007 to Rs 58.90 on 6 September 2007 on reports that the firm has sold eight acres of its defunct mill located near the Siddhivinayak temple at Prabhadevi, Mumbai, for Rs 350 crore to Mumbai-based builder Akruti Nirman.
Eveready Industries India rose 2.72% to Rs 54.75 on pricing equity warrants issue at an 8.81% premium to Thursday, 6 September 2007's closing price of Rs 53.30. The warrant holder will have an option to apply for one equity share of Rs 5 each at a premium of Rs 53 per share.
Tata Power Company was down 1.76% to Rs 716. As per reports, Tata Power plans to pick up a 15% stake in a new spot power exchange being planned by the leading commodity exchange National Commodity and Derivatives Exchange (NCDEX) and National Thermal Power Corporation (NTPC).
DLF was down 2.20% to Rs 621.25. As per reports, DLF plans to spin off its multiplex unit, DT Cinemas, into a separate company that will raise money through an initial public offering (IPO) in the next two years after adding more screens. DT Cinemas, fully owned by DLF, plans to invest Rs 1500 crore over two years to take its total number of screens to 500 in 100 multiplexes from seven in two currently.
Indraprastha Medical slumped 3.95%to Rs 34 after it turned ex-dividend, for a dividend of Rs 1.25 per share from today. It has face value of Rs 10 each.
Federal-Mogul Goetze (India) declined 2.94% to Rs 165 after it fixed 24 September 2007 as the record date for the purpose of rights issue.
Infomedia India surged 6.26% to Rs 272.50, despite denying PE firms picking up ICICI Venture's stake in the company. A newspaper report on Thursday, 6 September 2007, said private equity funds General Atlantic, Blackstone and Warburg Pincus had shown interest in acquiring ICICI Venture' 63% stake in Infomedia (formerly Tata Infomedia).
Sintex Industries slipped from the day's high of Rs 340. It closed 1.30% down at Rs 325. It acquired automotive products business of Mumbai-based Bright Brothers in an all-cash transaction for Rs 149 crore. Sintex will acquire ownership of Bright Brothers' all five automotive component manufacturing plants located in close proximity to major automobile production hubs like Chennai, Sohna, Pune, Pithampur and Nashik.
Rajesh Exports moved up 0.91% to Rs 651.85. The company said during trading hours on Friday, 7 September 2007, its board would meet on 17 September 2007 to consider increasing the investment ceiling for overseas investors' in the company.
Pump maker Kirloskar Brothers rose 6% to Rs 488 after it said after trading hours on Thursday, 6 September 2007, one of its joint ventures had received a 761-crore order for a canal project from the government of Andhra Pradesh. Kirloskar Brothers' share of the contract is worth Rs 114 crore
GMR Infrastructure lost 4.44% to Rs 775.70 after the National Stock Exchange banned fresh derivatives contracts effective today, 7 September 2007, as the open interest had crossed the 95% limit.
South Indian Bank climbed up 6.05% to Rs 168.45. A large block deal of 10.01 lakh shares was executed in the stock on BSE in early trade at Rs 162.50.
European markets, which opened after the Indian markets, were trading mixed. Key benchmark indices in Germany (down 0.46% to 7,586.39) and France (down 0.59% to 5,543.44) slipped. United Kingdom's FTSE 100 rose 0.08% to 6,318.40.
Asian markets settled mixed today, 7 September 2007. Japan's Nikkei (down 0.83% at 16,122.16), Hang Seng (down 0.28% at 23,982.61), South Korea's Seoul Composite (down 0.21% at 1,884.90) and Shanghai Composite (down 2.16% to 5,277.15) slipped.
However, Taiwan Weighted (up 0.01% at 9,018.08) and Singapore's Straits Times (up 0.66% at 3,489.08) advanced.
The Dow Jones industrial average rose 57.88 points, or 0.44%, to 13,363.35, on Thursday, 6 September 2007. Broader stock indicators also lifted. The Standard & Poor's 500 index gained 6.26 points, or 0.43%, to 1,478.55, and the Nasdaq Composite index was up 8.37 points, or 0.32%, to 2,614.32.
In a meeting held yesterday, 6 September 2007, Bank of England kept interest rates unchanged at 5.75% and the European Central Bank (ECB) also decided to keep its rates unchanged to 4%.
Crude oil prices climbed further above $76 a barrel on Friday, 7 September 2007, just about $2 below record highs, as tension between Syria and Israel compounded supply worries after fall in US crude and gasoline inventories. US crude gained 18 cents to $76.48 a barrel while London Brent crude edged up 3 cents to $74.80.
Thursday, September 6, 2007
Brokerage Recomendations
ICICI Research has maintained hold rating on Cipla. Research firm expects that the stock to underperform its peers (e.g. Sun Pharma) as well as the Sensex through the next 3-4 quarters.
UTI Securities is bullish on Hotel Leela Venture and has recommended buy raitng on the stock with a target of Rs 70.
Merrill Lynch is bullish on Motherson Sumi Systems and has recommended buy rating on the stock with a target of Rs 120, which implies 27% upside.
Merrill Lynch is bearish on Hindalco Industries and has recommended sell rating on the stock.
Sharekhan is bullish on India Cements and has recommended buy rating on the stock with a target of Rs 300.
Sharekhan is bullish on Elder Pharmaceuticals and has recommended buy rating on the stock with a target of Rs 508.
Merrill Lynch is bullish on Motherson Sumi System and has maintianed buy rating on the stock with target price of Rs 120 with potential upside of 27%.
HDFC Securities is bullish on Tanla Solution and has maintained buy rating on the stock with target price of Rs 706.
Mafatlal Securities is bullish on Patni Computers and has maintained buy rating on the stock with target price of Rs 635 with 6-month prespective.
P-Sec is bullish on Maruti Udyog and has maintained buy rating on the stock with target price of Rs 1073.
Fed may cut the rate by 25 bps in Sept; near term fundamentals in Asia are supportive, balance sheet in reasonable state: BNP Paribas Securities
He further said that near term fundamentals in Asia are supportive and the balance sheet is in reasonable state. However, Asia is not immune to the US slowdown. He is looking for domestic consumption plays rather than export plays in Asia. He said that he will remain invested as the near term fundamentals look supportive but advised that it will be a wise move to shift portfolio to focus on domestic plays. The markets in Asia will react negatively if Fed does not cut rate, he believes.
Issues related to sub-prime still have to sort out; looking for $ 300 Bn LBO financing and expecting the Fed action in September: Karma Capital
She further said that it is too early to make a call on Emerging Markets. About Indian markets she said that India should remain relatively insulated from US concerns and an economic standpoint.
Ms Parker said that she likes Infracstructure space and telecom as they both are the safe bets. She is also bullish on Media in the long term. In Media space, she is bullish on Print and TV in particular. But she is concerned about radia in Media space on increased compteition.
About other sectors, she likes BHEL, ABB, Reliance Energy in Power sector. She said that she is still concerned about IT services on rupee apreciation, slowdown in US and the increase in wages. She is also concerned on Real estate and the prices ahead of themselves. She advised to be selective in Auto. About Banking space, she said that she don't have much exposure in the banking.
New High In Sight: Sensex ends up 170pts
The index rebounded into positive zone soon, and then there was no looking back....
Aggressive buying towards the close saw the index rally to a high of 15,638 - up 288 points from the day's low. The Sensex finally ended with a gain of 170 points at 15,616.
The index is now just 253 points away from its all-time high of 15,869 hit in late July.
The BSE FMCG index gained 1.5% at 2032. The Auto, Bankex and Oil & Gas indices moved up over 1% each to 4937, 8111 and 8232, respectively.
The market breadth was positive - out of 2,774 stocks traded so far, 1,683 advanced, 1,015 declined and 76 were unchanged today.
LEADING THE RALLY...
Reliance Energy zoomed 4.5% to Rs 860. Grasim soared 4% to Rs 3,177, and Ranbaxy surged 3.5% to Rs 414.
HDFC rallied nearly 3% to Rs 2,111. SBI and Ambuja Cements gained 2.3% each at Rs 1,632 and Rs 141, respectively.
ITC and Tata Motors advanced around 2% each to Rs 175 and Rs 712, respectively.
Hindustan Unilever, ACC and Mahindra & Mahindra added 1.8% each to Rs 216, Rs 1,102 and 722, respectively.
Reliance and Tata Steel moved up 1.3% each to Rs 1,983 and Rs 693, respectively.
Bajaj Auto, Cipla, Wipro, HDFC Bank and Maruti were up around 1% each at Rs 2,333, Rs 185, Rs 478, Rs 1,185 and Rs 881, respectively.
VALUE & VOLUME TOPPERS
IVRCL Infra topped the value chart with a turnover of Rs 132.70 crore followed by Reliance Energy (Rs 125 crore), SBI (Rs 105 crore), Indiabulls (Rs 104.50 crore) and GMR Infra (Rs 102.70 crore).
Bellary Steel led the volume chart with trades of around 1.77 crore shares followed by IKF Technologies (1.32 crore), IFCI (1.26 crore), Tata Tele (1.14 crore) and Manali Petro (1.11 crore).
Sensex rose 170.16, just 253 points away from new high
The market scaled higher level as buying continued throughout the day, except for the odd blip in early trade. Asian markets rebounded from initial sluggishness while European stocks were trading mixed.
The BSE 30-share Sensex rose 170.16 points or 1.10% at 15,616.31. It opened lower at 15,383.13 and slipped further to hit a low of 15,350.18 at the onset of the trading session due to the overnight fall in the US stocks caused by weak US housing data.
However, it bounced sharply from that level to hit a high of 15,637.74. At the day's low of 15,350.18, the Sensex had lost 95.97 points for the day.
Sensex is now just 252.54 points away from its all time high of 15,868.85 hit on 24 July 2007.
The S&P CNX Nifty was up 42.75 points or 0.96% at 4,518.60. The Nifty September 2007 futures settled at 4507, a discount of 11.60 points as compared to spot closing
The market breadth was strong on BSE, with 1,698 shares advancing as compared to 1,050 that declined, while 74 remained unchanged.
The total turnover on BSE amounted to Rs 4646 crore as compared to Rs 5,167.23 crore on Wednesday, 5 September 2007. The NSE F&O turnover was Rs 40927.51 crore as compared to Rs 42642.91 crore on Wednesday, 5 September 2007.
The BSE Mid-Cap Index rose 1.11% to 6,848.68 while the BSE Small-Cap Index gained 1.28% to 8,395.58. Both these indices outperformed the Sensex by small margin
All the sectoral indices on BSE settled higher. BSE Consumer Durables index (up 1.09% to 4,497.19), BSE FMCG Index (up 1.54% at 2,032.09), BSE PSU index (up 1.22% to 7,287.77), BSE Oil and Gas Index (up 1.11% at 8,231.83), BSE Auto Index (up 1.24% at 4,937.54) and BSE Bankex (up 1.15% at 8,110.85), outperformed the Sensex.
However, BSE Realty index (up 0.37% to 7,547.65), BSE IT Index (up 0.41% at 4,665.46), BSE Metal Index (up 0.76% at 11,687.04), BSE TecK index (up 0.32% to 3,647.37), BSE Health Care Index (up 0.50% at 3,717.03), BSE Capital Goods Index (up 0.68% at 13,658.66 ) were underperformers.
From the 30-member Sensex pack, 27 advanced while the rest declined.
India's largest private sector power utility company by sales Reliance Energy advanced 4.91% to Rs 863.80 on 14.75 lakh shares. The stock surged to an all time high of Rs 864.70. As per reports the firm is planning to hive off its engineering, procurement and construction division into a new company. It was the top gainer from the Sensex pack.
Cement stocks held on to gains after opening firm on healthy dispatches in August 2007. The AV Birla group diversified company Grasim vaulted 4.25% to Rs 3186. It hit an all time high of Rs 3195
Other cement companies ACC (up 1.72% to Rs 1101), Ambuja Cement (up 1.56% to Rs 140), India Cements (up 4.31% to Rs 274.60), UltraTech Cement Company (up 1.68% to Rs 998), and Birla Corporation (up 3.55% to Rs 317.95) also edged higher.
HDFC (up 3.79% to Rs 2131), and ITC (up 3.15% to Rs 176.50), were the other gainers from the Sensex pack.
Ranbaxy Laboratories, India's top drug maker by sales, climbed 3.76% to Rs 415, on a newspaper report that the drug maker had submitted an initial bid for US-based Bradley Pharmaceuticals Inc
However Dr. Reddy's Laboratories, India's only drug maker listed in the US, was down 0.05% to Rs 661.95. The company has received approval from the US Food and Drug Administration for ulcer drug ranitidine hydrochloride tablets.
State Bank of India (SBI), the nation's largest banking entity by net profit advanced 2.60% to Rs 1635.90. As per reports, it will raise about Rs 1,500 crore through a bond issue this week. The issue will be part of SBI's Tier II capital and the size of core issue likely to be set at Rs 1,000 crore with over subscription option of Rs 500 crore.
Auto shares also rose on renewed buying. Tata Motors, India's top auto firm by revenue, rose 2.06% to Rs 712.60. Hero Honda Motors (up 2.72% to Rs 652), Bajaj Auto (up 1.44% to Rs 2340) and Maruti Udyog (up 0.57% to Rs 878) were the other gainers from auto pack.
Mahindra & Mahindra, the country's top utility vehicle manufacturer by sales edged higher by 1.84% to Rs 723 boosted by reports that it is looking to buy a design firm in Italy as part of its plans to expand presence in the automotive space.
India's largest private sector entity by market capitalisation and oil refiner Reliance Industries rose 1.51% to Rs 1987 on 5.05 lakh shares. It recovered from day's low of Rs 1948. RIL has completed acquisition of Indian Petrochemicals Corporation (IPCL), a move that could help it control two-thirds of the country's petrochemical market.
India's largest FMCG firm by sales Hindustan Unilever (HUL) rose 1.91% to Rs 216.50. As per reports, HUL will end a seven-week lockout on Monday, 10 September 2007, at one of its factories at Assam after a dispute with workers was resolved. The factory makes almost a third of the company's personal care products.
IT pivotals rose on late buying. Wipro (up 1.21% to Rs 478.50), TCS (up 0.35% to Rs 1075), Satyam Computers (up 0.78% to Rs 452) and Infosys (up 0.32% to Rs 1903) edged higher.
India's largest aluminium producer by sales Hindalco Industries was the top loser from the Sensex pack. It lost 1.37% to Rs 154.80 on 9.90 lakh shares.
India's largest listed cellular services provider in terms of profit, Bharti Airtel slipped 0.28% to Rs 846.60. As per recent reports, in the Karnataka circle, Bharti Airtel cannot acquire any operator as it already has a 39.7% market share. The 40% market share cap suggested by the
IVRCL Infrastructures (Rs 132.64 crore), Reliance Energy (Rs 124.95 crore), State Bank of India (Rs 104.89 crore), Indiabulls Financial Services (Rs 103.93 crore) and GMR Infrastructures (Rs 102.34 crore) were among the turnover toppers on BSE.
A lot of action was seen in 14 stocks that were included in the futures & options segment of NSE effective today, 6 September 2007.
3i Infotech (up 0.34% to Rs 149), Aptech (up 5.99% to Rs 338.10), Bhushan Steel (up 1.13% to Rs 948.70), Biocon (up 0.87% to Rs 471.05), CMC (up 3.06% to Rs 1156.95), Lakshmi Machine Works (up 9.56% to Rs 3205), NIIT Technologies (up 6.62% to Rs 365), Nucleus Software (up 0.63% to Rs 373), Sasken Communications (up 1.21% to Rs 382), Tech Mahindra (up 3.31% to Rs 1329), and Yes Bank (up 3.43% to Rs 189.90) surged.
But Welspun Gujarat Stahl Rhoren (down 5.77% to Rs 241), Tulip IT Services (down 0.75% to Rs 921.10), and Havells India (down 1.56% to Rs 512.10) edged lower.
Textile and apparel company Raymond was down 0.62% to Rs 273.10. It has reportedly entered the Rs 800-crore premium women's western-wear market with the launch of ColorPlus Women. Raymond will open 175 stores in the next three years to retail the range of ColorPlus apparel.
Punj Lloyd rose 1.63% to Rs 296. As per reports, the firm is planning a foray into defence equipment. It proposes to produce guns, rockets, missile artillery systems and related defence equipment and has applied for an industrial licence to make these products. The licensing committee of the ministry of commerce is expected to take a decision on this soon.
Color Chips (India) slumped 3.12% to Rs 7.77 after the National Stock Exchange said it had decided to suspend trading in the stock for non-compliance of provisions of listing agreement. The stock will be suspended from NSE after trading hours on 12 September 2007.
Saregama India jumped 10% to Rs 302.60. Sonata Investments acquired 10.58 lakh shares of the company at Rs 260 per share in a block deal on Tuesday, 4 September 2007, on BSE. The stock has risen 21% in the past two trading sessions.
Kernex Microsystem (India) gained 5% to Rs 359.40 on recent rumors that it may bag a six-year long railways contract worth Rs 2,000 crore in joint venture with Konkan Railways.
MSK Projects (India) rose 1.77% to Rs 100.40 after it received order worth of Rs 76.45 crore from Madhya Pradesh Road Development Corporation for execution of the Khandwa-Khargone (SH-26) road project.
Punjab Chemicals and Crop Protection soared 7.24% to Rs 155.50 on reports the firm is eyeing a 30% stake in US-based PSD Chemicals, a privately-held firm in the US. Reportedly, the total deal size could be around Rs 100 crore.
Gujarat Industries Power Company spurted 9.22% to Rs 7.40. Recently, its board approved expansion of its lignite-fired power generating capacity at an investment of Rs 1300 crore by installing two units of 250 mega watts each.
iGate Global Solutions flared up 6.16% to Rs 145.70. Yesterday (5 September 2007), Reliance Long Term Equity Fund bought 6.51 lakh shares of the company via two bulk deals on the BSE.
Hindoostan Spinning & Weaving Mills jumped 5% at Rs 56.10. It has spurted recently on reports that the firm has sold 8 acres of its defunct mill located near the Siddhivinayak temple at Prabhadevi, Mumbai, for Rs 350 crore to Mumbai-based builder Akruti Nirman.
Networth Stock Broking jumped 5% to Rs 99.80. The stock had risen 5% yesterday, 5 September 2007, on rumors that Hinduja Group is buying a majority stake in the company. The company clarified after market on that day, that that the company has been considering & contemplating proposal from investors. However no firm decision has been taken by it, neither has any arrangement was finalized.
Hindustan Dorr Oliver rose 2.22% to Rs 131 bagged a contract of Rs 77 crore from National Aluminium Company (Nalco)
Sical Logistics gained 4.86% to Rs 257 after Old Lane Mauritius IV invested Rs 107 crore for a 26% stake in the company's new unit, Sical Infra Assets.
Escorts dropped 1.61% to Rs 103.85 after the National Stock Exchange said after trading hours on Wednesday, 5 September 2007, it had barred fresh positions in the company's derivatives contracts as the open interest had crossed the 95% limit
Drug maker Abbott India was up 0.78% to Rs 575. The stock came off the session's high of Rs 585. It said after trading hours on Wednesday, 5 September 2007, its board had approved buying back shares worth Rs 51.84 crore, at a price not exceeding Rs 650 per share.
KS Oils surged 5.51%to Rs 71.75 after it said during trading hours on Thursday, 6 September 2007, it plans to form a joint venture in Malaysia to invest in palm plantations. The company will hold 49% in the joint venture.
Hindustan Zinc rose 2.96% to Rs 724.10 even it cut zinc prices by 3.7% to Rs 139200 per tonne, with ieffect from 6 September 2007. The company said lead prices were reduced by 6% to Rs 139100 a tonne.
Business directory publisher Infomedia India gained 5% to Rs 256.45 on a newspaper report that said a clutch of private equity firms were vying for ICICI Venture's 63% stake in it.
The European Central Bank kept interest rates unchanged at 4% in a meeting held today, 6 September 2007.
There are hopes that the US Federal Reserve will cut the fed funds rate by at least a quarter percentage point on 18 September 2007.
European markets, which opened after the Indian markets, were trading mixed today. Among key European indices, United Kingdom (down 0.11% to 6,253.50) and France (down 0.23% to 5,538.53) slipped while Germany's DAX rose 0.34% to 7,613.93.
Asian markets rebounded from lower levels today, 6 September 2007. Japan's Nikkei (up 0.61% at 16,257), Taiwan's Taiwan Weighted (up 1.16% at 9,017.08), South Korea's Seoul Composite (up 1.24% at 1,888.81) and Shanghai Composite (up 1.56% at 5,393.56) rose.
Hang Seng index was down marginally by 0.08% at 24,050.40
US markets finished lower yesterday, 5 September 2007, after weak US housing data revived concerns about the health of the world's biggest economy. The Dow Jones Industrial Average slipped 143.39 points, or 1.07%, at 13,305.47. Broader stock indicators also lost ground. The
Standard & Poor's 500 index fell 17.13 points, or 1.15%, to 1,472.29, and the Nasdaq Composite index fell 24.29 points, or 0.92%, to 2,605.95.
Crude oil prices rose to $76 a barrel on Thursday, 6 September 2007 buoyed by expectations that US crude and gasoline inventories fell last week. US crude rose 33 cents to $76.06 a barrel while London Brent crude was up 21 cents at $74.55 a barrel.
The National Stock Exchange said on Thursday, 6 September 2007, it will extend trading timing by 45 minutes from 25 September 2007 to 9 October 2007 due to loss of satellite connectivity during this period. Trading will close at 11:25 IST and re-open at 12:10 IST. The final closing will be at 16:15 IST, instead of 15:30 IST.
The Indian investor gets savvier
In the past month, the average daily volatility witnessed in Nifty increased by nearly 86%, with the average daily point movement in Nifty being approximately ± 2.15%. This implies that the Nifty, on an average, moved 92 points both ways. This is in contrast to the regular market movement during the past one year when volatility was around ± 1.24%.
The spurt in the seismograph of Indian indices was not a one-off phenomenon, but was visible throughout the emerging and developed world. This short-term stampede was largely due to the sharp increase in risk aversion witnessed by investors, primarily FIIs and hedge funds. The rising defaults in the US subprime market — a fall-out of credit abuse — coupled with declining demand for new properties, hit financial companies which had securitised or invested in subprime loans and mortgages.
The consequent rise in losses in the US-based funds resulted in panic and increased redemption pressure on international funds. With the underlying assets (read subprime loans) having become illiquid, redemptions had to be funded via the sale of liquid assets. This led to a sell-off in emerging markets.
A more significant long-term impact of this could be the possibility of a slowdown in US consumption and the economy. The housing slowdown has already caused a dent in the home equity of US consumers. With higher oil prices looking a distinct possibility and declining real wages in the US, fears of a recession in the US economy have become real.
The latest US economic data hints at falling consumption of durable goods, residential investment in free fall, inventories on the increase and declining sales in the retail sector. The focus of the Fed is, therefore, shifting towards growth rather than inflation. So, there is a high likelihood of cut in interest rates in the US.
Against this backdrop, the India Growth Story acquires a much deeper meaning since India is one of the few nations whose growth is largely shielded form global upheavals, including that of the US. This is because almost two-thirds of our GDP comes from domestic consumption. The total Indo-US trade is around $26.8 billion and is growing at 29.5% YoY. Despite the US being our largest trading partner, the total contribution of the US trade in demand for Indian goods is around 1.7% of the GDP.
This implies that the high-paced growth seen in India since the past decade was sustained by internal demand. The government's commitment to incur a capex of $300 billion in the next five years, coupled with a similar expansion programme in the private sector, has unleashed a capex cycle that is expected to sustain in the mid-term. The gross fixed capital formation in India is already at 30.2% of the GDP and is expected to rise to 35% in five years. This bodes well for India Inc, which can expect to see demand-driven growth in the future. In short, future GDP growth seems to be intact.
However, the domestic stock market will continue to be well-integrated with the global capital market. The eventual de-coupling of the Indian market from the crisis engulfing the rest of the world will begin gradually. The credit premiums offered for emerging markets have declined significantly on the back of huge currency chests of these economies. Against the backdrop of these uncertainties, the Indian investor has shown greater maturity by keeping faith in the market.
In fact, perhaps s/he has become far more confident in facing these bouts of volatility. But complacency should not set in. The investor should consider these bouts of volatility to buy fundamentally strong companies available at good valuations.
(The author is, CEO, Kotak Mutual Fund)
Post Market Commentary
BSE Capital goods index slipped by 65.90 points to close at 13,566.71 as Jyoti structures (2.82%), L&T (1.32%), Praj industries (1.05%), BHEL (0.94%) and Siemens (0.32%) closed in red.
BSE bankex index closed higher by 11.84 points at 8,018.42 as Andhra bank (1.58%), AXIS bank (1.36%) and ICICI bank (1.17%) closed higher while Bank of Boroda (2.52%), BOI (2.43%), Yes bank (1.53%), SBI (0.99%) and HDFC bank (0.15%) closed lower.
BSE Metal index advanced by 20.02 points to close at 11,598.59 as JSW steel (2.68%), Sesa Goa (1.72%), Sterlite (0.55%), Welspun (0.35%) closed higher while Bhusan steel (4.55%), Hind Zinc (2.37%) and Jindal stainless (1.07%) closed lower.
BSE Auto Index grew marginally by 2.64 points to close at 4,876.96 as Tata Motors (1.05%), Ashok Leyland (0.91%) and Bajaj Auto (0.90%) closed in green while M&M (0.84%), Maruti Udyog (2.34%), Hero Honda (1.01%) closed in red.
BSE oil & gas index dropped by 45.95 points to close at 8,141.59 as HPCL (0.94%), RPL (0.73%), IPCL (0.67%), Indian Oil (0.44%), ONGC (0.23%) and BPCL (0.02%) closed lower.
BSE IT index jumped by 20.45 points to close at 4,646.29 as HCL Tech. (1.61%), Wipro (1.47%), Infosys (0.44%), TCS (0.53%) and I-Flex (0.48%) closed higher.
BSE Health Care Index closed up by 18.33 points at 3,698.69 as Matrix labs (8.53%), Sun pharma (3.16%), Cadila (2.26%), Cipla (1.87%), GlaxoSmithKline (0.33%) and Dr reddy (0.16%) closed higher.
BSE FMCG index grew by 6.97 points to close at 2,001.21 as united breweries (3.10%), Colgate Palmolive (1.58%), Dabur (1.29%), HUL (0.81%) and Godrej (0.68%) closed in green.
Buy Satyam Computers: Edelweiss Research
Questions and Answers
1. How do you see the environment in the US affecting Satyam?
A. We have just concluded our routine monthly review meeting with the top-40 business unit heads and senior managers. As part of this exercise, we dissect the progress of each client account, review the behavior of all practices and see how these data points emanating from such a granular level feed into shaping our outlook. This is commonly a 3-day exercise. Our August-end review suggests to us that it's business as usual. We are not seeing any impact as of now on account of the difficulties in the US.
2. Satyam's application development and maintenance exposure (ADM) has grown over the last four quarters at just over 25% on a y-o-y basis. Hasn't Satyam's growth in the recent past accrued from "discretionary" spend? What is the relative ADM exposure in Satyam's BFSI segment?
A. The ADM market is generally a slower-growth market than the rest of IT-Services such as package implementation, infrastructure management, independent testing and system integration. So, our growth has been very much in line with this trend. We have a higher-than-company average concentration of the ADM type of work in our BFSI segment. To this extent, our exposure to the BFSI segment is relatively defensive.
3. Are you concerned by the increasing concentration of your revenues in enterprise solutions which contributed over 44% of your revenues in Q1FY08?
A. We must deconstruct the composition of this segment that we at Satyam characterize as enterprise solutions. The classical ERP type of applications account for only a part of this (about 30% of overall revenues) with the rest coming from business intelligence, data warehousing, analytics, supply chain management and CRM solutions. Further, only about 50% of the pure-ERP portion (i.e. about 15% of the overall revenues) accrues from new implementations as the balance comes from support (mainly done offshore) which tends to be relatively stable. In essence, therefore, ERP work that one might classify as "discretionary" accounts for about 15% of our overall revenues or about a third of our overall exposure to enterprise solutions. Moreover, a good part of our exposure in enterprise solutions derives from the manufacturing and TIME vertical, outside the BFSI segment.
4. Are there any segments of your BFSI exposure (especially BFS), that you are worried about? Exposure to investment banking clients or any others?
A. Our direct exposure to sub-prime mortgage lenders is negligible, and to the mortgage segment as a whole, is less than 1% of our revenues. Only about 24% of our FY07 revenues came from the BFSI segment, most of the work is done for large, diversified financial institutions. The BFS accounts for about 17% of this while insurance, which is stable, contributes the balance 7%. Our 17% BFS exposure is split roughly equally across the three line viz. commercial/retail banking, financial services and investment banking (or capital markets). Thus, our capital market exposure is about 6% of revenues and though we haven't seen any indications of any fallout yet in this subsegment, we believe that if there were to be some hiccups in this area broadly speaking, our modest exposure to this places us in a favorable position to manage them.
5. Are you seeing any impact on business that can be termed as "discretionary spending'?
A. High-growth services such as business intelligence, analytics, CRM, SCM and consulting are relatively more discretionary. At the moment they continue to show traction and we so far not seeing a slow-down in such higher-margin discretionary services, but are keeping a watch. We believe that businesses increasingly regard this spend as essential to their competitiveness. More so, we provide such services outside the BFSI segment and largely in the manufacturing and TIMES vertical. Together these verticals contributed about 48% of Q1FY08 revenues).
6. Is it impacting the way you are building order books, building sales pipeline or winning repeat business? New Clients and promised volume growth from existing clients – are they all coming through?
A. There is no change in the near-term outlook for the business. The improvement in pricing is tracking expectations. Our order book is healthy. There are at least 20 large deals up for grabs, each of them of the order of USD 50 million plus and we are in fairly advanced stage negotiations in about 10 of these.
7. Are your hiring plans on track or is there some element of a wait-and-watch policy you are now adopting given this global uncertainty?
A. At this point, hiring is progressing as planned. We have indicated towards hiring about 15,000 – 16,000 people (gross) and that remains.
8. Do you have any mortgage clients in your BPO? If so, what is the impact?
A. Our BPO business has negligible exposure to mortgage clients. We have not seen any impact on our business from the recent events.
9. Are you getting any sense of how CY08 IT budgets of your key clients is shaping up?
A. Clients are yet to firm up their IT-budgets for the forthcoming calendar. We will get a sense from them within a month's time in October. So far, we cannot see the crisis in the US as affecting our clients' CY08 IT budgets. We are carefully monitoring the situation and currently feel comfortable about our clients' engagement levels with us.
10. How will a potential slowdown impact Satyam?
A. A slowdown in the US may set us back by 3-6 months. Today, we are in a better position to manage our order books and if developments in the US unexpectedly slow us down, we can get back on track within a quarter or two. We have flexibility in managing our exposure across clients, practices, geographies. We are seeing traction in infrastructure management and that's relatively immune to a potential slowdown. So, we do not believe that a slowdown should impact our growth rates beyond a quarter or two.
Valuation:
We believe that Satyam will continue to grow in a good macro environment. Satyam's BFSI exposure is relatively lower compared to peers and that puts the company in a relatively good position in the event of weakness in this space. The company is likely to post leading-industry growth in FY08 over FY07 (near-40% in USD terms) but this is already partly factored in at current stock price levels. We will watch out for how Satyam manages its margins in the coming quarters which we believe could be a strong stock driver hereon. In the event of a significantly tougher environment in the US affecting corporate spending on a broad basis, the signs of which we have not yet seen, we would prefer players such as Infosys and TCS by virtue of their relatively higher defensive exposure.
Investors are unlikely to rush into buy front-line technology stocks because they believe that the bottom is sometime away as further concerns continue to be priced in. In our opinion, further declines in stock prices hereon only make the risk-reward balance more favorable for investor. We believe that Satyam's valuations have become fairly reasonable for investors at this point in time. It is at a 20% discount to Infosys on valuations at current levels, which is just about fair and which we believe should not increase. It currently trades at 18.6x FY08E and 14.4x FY09E, and we maintain our 'BUY' rating on the stock.
Brokerage Recomendations
Motilal Oswal research is bullish on Grasim Cement and has maintained buy rating on the stock with target of Rs 3558, which implies upside potential of 21%.
HDFC Securities is bullish on Gujarat State Fertiliser and has maintained market performer rating on the stock with target potential of 12% upside.
Morgan Stanley is bullish on Parsvnath Developers and has maintained Overweight raiting on the stock with target of Rs 472.
HSBC Global research is bearish on TVS Motors and has maintained underweight rating on the stock with target price of Rs 55 with Potential return of -16%.
Motilal Oswal research is bullish on Union Bank and has maintained buy rating on the stock with target of Rs 180.
Edelweiss is bullish on Nicholas Piramal and has maintained buy rating on the stock. Research firm believe that the EPS for stock could move up from 13.2 in FY08E to 15.7 and from 17.3 to 20.4 in FY09E.
P-Sec research is bullish on M&M (Mahindra & Mahindra) and has maintained buy rating on the stock. Recent correction in stock prices over concerns of rising interest rate gives good upside from current level.
Sharekhan research is bullish on Tata Motors and has maintained buy rating on the stock with target price of Rs 792.
Sharekhan Stock Broking firm is bulllish on Bharat Electronics and has maintained buy rating on the stock with target price of Rs 1975.
Sharekhan reserch is bullish on Tata Tea and has maintained buy rating on the stock with target price of Rs 970.
HSBC Global research has maintained underweight rating on NTPC from neutral rating and set a target price of Rs 179.
Morgan Stanley maintain Overweight rating on Sesa Goa, raise price target to Rs 2,247
Vedanta has purchased a 51% stake in Sesa from Mitsui and therefore has to make an open offer to Sesa's minority shareholders to buy another 20% stake.
Sesa is trading at an F2009e P/E of 7.8x and EV/EBITDA of 3.8x, which we think reflects neither the likely iron ore price strength nor the company's ability to increase production. As a result, the stock is pricing in lower earnings growth and a lower multiple than it deserves as a mid-cycle commodity stock. We emphasise that we expect iron ore prices to remain strong for the next three years.
Morgan Stanley forecast strong iron ore prices for the next three years, which should benefit Sesa as the only iron ore sector stock in India. Accordingly, we have a strong positive view on the stock. Also, by puting forward strong volume growth and attractive valuations as two additional investment positives for the stock. We estimate an 8.2% sales volume CAGR for F2008-10. As mentioned, the stock is trading at what we view as attractive F2009e multiples of 7.8x P/E and 3.8x EV/EBITDA.
Iron ore is one of MS preferred commodities because they believe supplies are finding it difficult to catch up with growing demand from China. An impending tapering off of ore exports from India is compounding the supply shortage. India has been a large swing supplier of iron ore to China in the past three years.
Sesa Goa has touched an intra day high of Rs 2,020.00 and an intra day low of Rs 1,959. Currently the share is quoting at Rs 2,009, up Rs 48.80, or 2.49%
It is trading with volumes of 74,784 shares, compared to its 5-day average of 45,349 shares, an increase of 64.91%. It is trading with volumes of 74,784 shares, compared to its 30-day average of 20,480 shares, an increase of 265.16%.
Yesterday the share closed up 0.75% or Rs 14.55 at Rs 1,960.20
SBI likely to go for rights issue to meet capital requirements, quantum & timing of issue not finalized yet
Kirloskar Brothers bags orders worth Rs 94.27 Cr
The project includes design and construction of micro- irrigation lift system, comprising civil, steel pressure mains, pump houses and electro mechanical works, it said. It also consists of other necessary ancillary works to supply water by lift from foreshore to reservoirs and providing distributory system for 8,750 acres in Anantapaur Dist. Of the total value of the contract, Kirloskar's portion is worth Rs 94.27 crore.
Maruti: Don't expect substantial sales increase ahead festive season; High fuel cost, Interest rates continue to be cause of concern
Pyramid Theatres to bid for Australia's chain of Multiplex Hoyts owned by Kerry Packer group, deal size close to $ 360 Mn
India's largest digital theatre chain Pyramid Saimira Theatre (PSTL) is bidding for Hoyts, the largest Australian chain of multiplexes owned by the Kerry Packer group. Sources said the takeover could cost the buyer around $ 360 million (Rs 1,500 crore). The Packer group, which currently controls Hoyts through its two media firms, Publishing Broadcasting and West Australian Newspapers (WAN), has put the largest theatre chain in Australia on the block.
Apart from Pyramid, Paul Ramsay's Prime Television, American cinema operator Reading, and private equity firms Catalyst Investment Managers and Gresham Private Equity have also lodged their bids for Hoyts with UBS, which is advising the Packer group on the deal. Sources close to the development said PSTL has been qualified in the technical bid round and entered the financial bid round, with September 7 being the deadline for submitting the financial bid. Investment banking firm Earnst and Young (E&Y) is advising PSTL on the deal.
PS Saminathan, managing director, PSTL, declined to comment on the deal. The bid, if successful, will give an entry to PSTL into the western world. Currently, Hoyts operates cinemas in Australia, New Zealand, Argentina, Brazil, Chile and Uruguay. Earlier, it had sold most of its theatres in the US to Regal Entertainment group.
Apart from India, PSTL runs film theatre chains in Malaysia and Singapore. PSTL has 3,00,000 seats across locations, which, according to PSTL officials, is only half of what world's biggest theatre company, Regal of the US, offers. PSTL had already raised Rs 370 crore through an FCCB issue few months ago and is now exploring various options to raise more funds.
Hoyts is jointly owned (50% each) by Publishing and Broadcasting (PBL), a leading media, gaming and entertainment group, and Western Australian Newspapers Holdings (WAN), a leading newspaper group in Australia. Following PBL's decision earlier this year to separate its gaming and media businesses, it had declared in May 2007 an intention to monetise its ownership interests in Hoyts.
Australia is a high intensity entertainment place. In fact, the national attitude is derived from sports and entertainment. Filmed entertainment mostly consists of Hollywood entertainment, which accounts for about 95% of revenues. Australia has become a major film production base and also has an outsourcing base for Hollywood films. The total entertainment market in Australia was Australian $ 22.4 billion in 2006. The average ticket price in Australia is approximately Australian $ 10 and the average rate of tax is 10%.
Market snaps eight-day winning streak
The BSE 30-share Sensex declined 19.25 points or 0.12% at 15,446.15. It opened higher at 15,535.35 and advanced further to hit a high of 15,580.86. It hit a low of 15,407. Sensex oscillated in a range of 173.86 points for the day.
The Sensex had surged 1,301 points, or 9.18%, in eight trading sessions, from 14,163.98 on 23 August 2007 to 15,465.40 on 4 September 2007. A fall in inflation and robust economic data along with steady inflow of FIIs helped the market rally in the recent past.
The S&P CNX Nifty slipped 3.40 points or 0.08% at 4,475.85. The Nifty September 2007 futures settled at 4416.15, a sharp discount of 59.70 points as compared to spot closing
The market breadth which was strong throughout the day, eased in late-afternoon session. On BSE; 1,403 shares advanced as compared to 1,331 that declined, while 65 remained unchanged. This is in contrast to morning session, when 1253 shares advanced, 324 declined and 29 were unchanged.
The BSE Mid-Cap Index rose 0.11% to 6,773.34 while the BSE Small-Cap Index gained 0.23% to 8,289.81. Both these indices outperformed the Sensex.
Most of the sectoral indices on BSE settled higher. The BSE Health Care Index (up 0.50% at 3,698.69), BSE Consumer Durables index (up 1.07% to 4,448.64), BSE Realty index (up 0.77% to 7,520.04), BSE PSU index (up 0.08% to 7,200.09), BSE FMCG Index (up 0.35% at 2,001.21), BSE Metal Index (up 0.17% at 11,598.59), BSE TecK index (up 0.02% to 3,635.58), BSE Auto Index (up 0.05% at 4,876.96) BSE Bankex (up 0.15% at 8,018.42), and BSE IT Index (up 0.44% at 4,646.29) outperformed the Sensex.
However, BSE Capital Goods Index (down 0.48% at 13,566.71) and BSE Oil and Gas Index (down 0.56% at 8,141.59), were underperformers.
Turnover on BSE spiked today to Rs 5,167.23 crore as compared to Rs 4207 crore on Tuesday, 4 September 2007. NSE's F&O turnover was Rs 42642.91 crore as compared to Rs 39013.75 crore on Tuesday, 4 September 2007.
From 30-member Sensex pack, 18 slipped while the rest gained.
India's third largest pharma company by sales, Cipla gained 2.17% to Rs 183.50 on 9.27 lakh shares. It was the top gainer from Sensex pack.
Ambuja Cements, India's third-largest cement maker, gained 1.98% to Rs 138.80 after the company said during trading hours on Wednesday, 5 September 2007, its cement shipments rose 3% to 1.15 million tonnes in August 2007 over August 2006.
India's largest power generation company by sales NTPC advanced 1.74% to Rs 184.50. The stock hit an all-time high of Rs 188.60. As per reports, NTPC is looking at the possibility of acquiring Karnataka-based public sector firm Tungabhadra Steel Products (TSPL). TSPL is a supplier of hydraulic gates, radial and vertical gates for hydel power plants, equipment for sponge iron and thermal power plants, and even oil rigs.
ICICI Bank (up 1.45% to Rs 917.25) and Grasim (up 1.06% to Rs 3055) were the other gainers from the Sensex pack.
IT pivotals gained on fresh buying. Wipro (up 1.08% to Rs 471), Infosys (up 0.20% to Rs 1892.30) and TCS (up 0.87% to Rs 1075) rose
However India's fourth largest software company by net profit, Satyam Computers slipped 0.72% to Rs 446 on high volumes of 14.26 lakh shares after a block deal of 11.61 lakh shares was struck on the counter on BSE at Rs 453.30 by 09:58 IST.
The rupee was hovering at 40.94, slightly firmer than Tuesday (4 September 2007)'s close of 40.97/98.
India's largest private sector entity and oil refiner Reliance Industries (RIL) slipped form an all-time high of Rs 1999.30 struck earlier during the day. It shed 1.28% to Rs 1946.20 on 6.56 lakh shares. CPI (M) on Tuesday, 4 September 2007, joined the row over pricing of gas to be produced from RIL's Krishna Godavari basin, asking the government to reject what it feels is an artificially inflated price proposed by the company.
RIL said after market closed on Tuesday, 4 September 2007, it had acquired a majority stake in Gulf Africa Petroleum Corp for an undisclosed sum.
India's top small car maker in terms of net profit Maruti Udyog slipped 2.68% to Rs 869.95 after it hinted that it may continue to offer discounts on its car models to boost sales in the upcoming festive season. It was the top loser from the Sensex pack.
Ranbaxy Laboratories (down 2.09% to Rs 398.20), and ACC (down 2.05% to Rs 1075.10) were the other losers from the Sensex pack.
India's largest listed cellular services provider in terms of profit, Bharti Airtel slipped 1.51% to Rs 846.40. As per reports, in the Karnataka circle, Bharti Airtel cannot acquire any operator as it already has a 39.7% market share. The 40% market share cap suggested by the Telecom Regulatory Authority of India (Trai) is likely to make mergers between existing telecom operators extremely tough.
Larsen & Toubro (L&T), India's largest private sector engineering company in terms of sales lost 1.82% to Rs 2575.55. It's ECC division in consortium with Paul Wurth, Italy bagged a Rs 1205 crore order from Bhushan Steel. L&T's share in this project is pegged at Rs 760.5 crore.
Among side counters, Escorts (up 8.94% to Rs 103), Omnitech Solutions (up 20% to Rs 155.30), and Allied Digital (up 9.58% to Rs 350.10) surged.
SEL Manufacturing (down 17.58% to Rs 147.40), JCT (down 6.90% to Rs 9.99) and Indiabulls Financial Services (down 5.81% to Rs 532.50) slipped
Sugar shares surged on renewed buying. Dwarikesh Sugar (up 2.50% to Rs 55.40), Sakthi Sugar (up 2.99% to Rs 75.75), Triveni Engineering (up 5.09% to Rs 81.55), Balrampur Chini Mills (up 2.18% to Rs 60.95), Shree Renuka Sugars (up 1.10% to Rs 528.90), and Bajaj Hindustan (up 0.75% to Rs 135.05) advanced.
Everonn Systems (Rs 86.77 crore), Reliance Industries (Rs 129.19 crore), Lakshmi Machine Works (Rs 125.48 crore), Take Solutions (Rs 124.66 crore), and Reliance Energy (Rs 117.57 crore) were among the turnover toppers on BSE.
Akruti Nirman moved up 4.34% to Rs 568 on reports that the company has tied-up with a Dubai-based firm Limitless, a subsidiary of Dubai World, to bid for the project for redevelopment of Asia's largest slum, Dharavi in Mumbai.
Kernex Microsystem (India) jumped 5% to Rs 342.30 on rumors that it may bag a 6-year long railways contract worth Rs 2,000 crore in joint venture with Konkan Railways.
Ashok Leyland had gained 0.91% to Rs 38.70 on reports that the company is open to acquisitions and alliances in medium and heavy truck sectors.
Shreyas Shipping & Logistics had jumped 14.62% to Rs 103.50 after it bought 51% in Sri Lankan transportation and freight forwarding firm Haytrans (India) for an undisclosed amount.
Saregama India jumped 10% to Rs 275.10 after Sonata Investments acquired 10.58 lakh shares of the company, at Rs 260 per share in a block deal on Tuesday, 4 September 2007 on BSE.
Kirloskar Brothers slipped from a high of Rs 477.70 to settle 1.12% lower at Rs 464.95. Its joint venture firm KBL-PLR bagged a Rs 118.27 crore project from Andhra government's irrigation department. Of the total value of the contract, Kirloskar's portion is worth Rs 94.27 crore.
Autoline Industries rose 1.92% to Rs 199. As per reports, it is in advanced talks with a US-based maker of sheet metal-based assembled products with $25 million (Rs102.5 crore) in sales. The firm is also in initial talks with a European sheet metal component supplier which it is interested in acquiring.
Gayatri Projects gained 0.10% to Rs 287.35 on bagging a 3-year long road contract worth Rs 311.89 crore in Orissa.
Cambridge Technology Enterprises rose 1.21% to Rs 50.15 after it said before trading hours on Wednesday, 5 September 2007, its board has approved raising Rs 23.37 crore through the issue of 4.25 million convertible equity warrants at a price of Rs 55 each.
Bombay Burmah Trading Corporation surged 5% at Rs 488.50 on BSE on reports that the company may use its cash reserves to buy Danone's 25.5% stake in Britannia Industries. As per its latest annual report, it has Rs 608.27 crore in consolidated reserves and surplus.
Hindoostan Spinning & Weaving Mills jumped 5% at Rs 56.10. It had gained 5% yesterday, 4 September 2007 on reports that the firm has sold 8 acres of its defunct mill located near the Siddhivinayak temple at Prabhadevi, Mumbai, for Rs 350 crore to Mumbai-based builder Akruti Nirman.
Gujarat Industries Power Company spurted 8.62% to Rs 69.95. Recently, its board approved expansion of its lignite-fired power generating capacity at an investment of Rs 1300 crore by installing two units of 250 mega watts each.
Exide Industries advanced 4.88% to Rs 64.45. Earlier on 28 August 2007, the company's board had approved to raise Rs 150 via rights issue in the ratio of 1:15 i.e one rights share for every 15 shares held at Rs 30 per share.
Puravankara Projects was down 1.04% to Rs 371.50. As per reports, it is close to signing a memorandum of understanding (MoU) with France-based hospitality group Accor for the former's first hotel project in Bangalore.
Pyramid Saimira Theatre (PSTL) was down 4% to Rs 336.90. It hit a high of Rs 361.90 on repots that it is bidding for Hoyts, the largest Australian chain of multiplexes owned by the Kerry Packer group, for around $360 million (Rs 1500 crore).
Jet Airways rose 0.55% to Rs 830, on reports it is delaying a planned $400-million rights issue because of the recent turmoil in the global credit markets.
The government late on Tuesday, 4 September 2007, announced setting up of a 15-member UPA-Left committee which will look into the concerns raised by Left parties on the Indo-US civil nuclear deal. External Affairs Minister Pranab Mukherjee will be the convenor of the committee. The committee will have six members each from Congress and Left parties and one each from UPA constituents RJD, DMK and the NCP.
European markets which opened after the Indian markets, were trading lower. Key benchmark indices in Germany (down 0.80% to 7,660.35), France (down 1.12% to 5,609.40) and United Kingdom (down 0.97% to 6,314.70) slipped.
Asian markets that began trading before the Indian markets, settled on a mixed note. Hong Kong's Hang Seng (up 0.77% at 24,069.17), Shanghai Composite (up 0.31% to 5,310.76) and Singapore's Straits Times (up 2.04% at 3,445.08) advanced.
However, Japan's Nikkei (down 1.60% at 16,158.45), Taiwan Weighted (down 0.10% at 8,913.85), and South Korea's Seoul Composite (down 0.49% at 1,865.59) slipped.
US stocks advanced yesterday, 4 September 2007. The Dow Jones industrial average rose 91.12 points, or 0.68%, to 13,448.86. Broader stock indicators also advanced. The Standard & Poor's 500 index added 15.43 points, or 1.05%, to 1,489.42, and the technology-dominated Nasdaq Composite index surged 33.88 points, or 1.30%, to 2,630.24.
Crude oil rose towards $75 today, 5 September 2007, after predictions of more hurricanes in the Atlantic Ocean raised concern over potential oil and gas outages. US crude was up 70 cents at $74.74 while London Brent crude was up 45 cents at $73.86
