Wednesday, May 20, 2015
Appearing better! Indices to open in green
The world is governed more by appearances than realities, so that it is fully as necessary to seem to know something as to know it. - Daniel Webster
The market saw all its gains vanishing on Tuesday as profit booking set in, especially in the banking counters. The government has proposed exempting interest earned on gold deposits from income tax, wealth tax or capital gains tax. It is also examining the option of allowing banks to use gold deposited under the monetisation scheme announced in the Budget as a part of their cash reserve and statutory liquidity. The draft gold monetisation scheme seeks to bring in small investors by lowering the minimum gold that can be deposited to 30g from 500g.
Back to the market, the situation appears better this morning. Indices could start off on a cheerful note buoyed by global cues. Reliance Communications could take over Sistema Shyam Teleservices (SSTL) in an all-stock deal. Expect action in these counters. Tata Steel has already addressed some concerns so disappointment may be less on the counter as it announces its numbers. DLF, Aarti Drugs, Bajaj Finance, Archies, Bharat Forge and Brigade are among the other counters which will see action based on their results.
The Dow was up 0.07% while S&P closed a tad lower. Nasdaq shed 0.17%. Japan's Nikkei 225 index was trading higher, Hong Kong's Hang Seng index was lower and China's Shanghai index is in the green.
The Cabinet Committee on Economic Affairs (CCEA), led by Prime Minister Narendra Modi, has already granted approval for stake sale worth about Rs 50,000 crore (at current prices) in about 20 companies, says a report.
The NSE had about 5.2 million active clients for all stock brokers of the exchange.
The valuation of holdings by domestic institutional investors (DIIs) in National Stock Exchange (NSE)-listed firms hit a six-year high of Rs 10.21 lakh crore at the end of March, on account of buoyant markets, says Prime Database. In percentage terms, DII holding in NSE-listed companies went up to 5.01 per cent at the end of March 31, compared with 4.58 per cent on an aggregate basis.
Reliance Industries Limited announced that it has priced its Regulation S offering of US$ 200 million 5% Senior Unsecured Callable Notes due 2035 (the "Notes").These Notes, denominated in US dollars, have been issued primarily to Taiwanese life insurance companies and are proposed to be listed on Taipei Exchange (formerly known as GreTai Securities Market). Such notes are commonly known as Formosa Bonds.
Deutsche Bank AG, Taipei Branch and HSBC Bank (Taiwan) Limited acted as Joint Bookrunners and Lead Managers on the transaction. Morgan Stanley & Co. International plc acted as the Structuring Agent on the transaction.
GoAir Promoters are exploring options for IPO and looking at $150-200 mn size, according to reports.Report said that the airline appointed 2 bankers to explore IPO Options. The promoters are looking at total valuation of $650-700 mn, says report. The airline is likely to consider IPO by Q4 Of Current Calendar Year.
Indo Rama Synthetics India Ltd has hit 20% upper circuit at Rs. 21.50 after the company has posted Q4 results.
Mahindra Holidays & Resorts India tumbled 2% at Rs. 246.The company has reported 58% drop in standalone Q4 net profit to Rs. 10.42 crore as compared to Rs. 24.38 crore on year-on-year basis.
Bharti Airtel rallied to a high at Rs. 405 on media reports that the firm is in advanced talk to buy out Augere Wireless Broadband India for about Rs. 150 crore to consolidate its 4G high-speed broadband footprint ahead of Reliance Jio Infocomm's launch. The stock however, ended with a loss of 0.6 percent at Rs. 395.
Among other stocks - Bharti Infratel scaled to hit 52-week high at Rs. 440 after the company informed the BSE that it has been included in the list of stocks in MSCI Global Standard Index. The stock ended with a surge of 5.1 percent at Rs. 439.
NIIT Technologies added 1.6 percent at Rs. 387 after the company has signed a strategic agreement to acquire majority stake in Incessant Technologies.
Kellton Tech Solutions zoomed 15.4% at Rs. 76.50 after the company informed the BSE that it is in the final stage of acquiring a US-based IT Solutions Company with revenue of about $ 40 million.
AXISCADES Engineering Technologies tumbled to hit 5% lower circuit on the BSE on reporting 27.3 percent decline in Q4 net profit on year-on-year basis. However, the stock recovered most of its losses and ended with a loss of 1.5 percent at Rs. 245.
Suzlon Energy rallied to a high at Rs. 26.90 on receiving new order from Mytrah Energy to supply 98MW project in Telangana. The stock however ended unchanged at Rs. 26.15.
Just Dial soared 5.7% at Rs. 1,139 on reports that the company has expanded the scope of B2C transaction based services by adding product e-commerce marketplace.
National Buildings Construction Corporation (NBCC) spurted almost 3% at Rs. 811 on entering into a Memorandum of Understanding (MoU) with NAWADCO for developing four Properties involving overall construction cost of Rs. 398 crore.
JBM Auto slumped 12.6 percent at Rs. 207 after the company reported 15.2 percent fall in Q4 net profit on year-on-year basis.
Results watch: Tata Steel, DLF, Aarti drugs, Bajaj Finance, Archies, Bharat Forge, Brigade, Era Infra, Globusspr, HGS, JB Chem Pharm, Shreyan Ind, TD Power Sys, TTIL, Sujanatwr, Voltamp, Wabco India.
Global Data: Westpac Consumer Confidence Index (May) AUD, Westpac Consumer Confidence (May) AUD, Coincident Index (Mar) JPY, Leading Economic Index (Mar) JPY, Producer Price Index (MoM) (Apr) EUR, Producer Price Index (YoY) (Apr) EUR, Fed's Evans Speech USD, Non-monetary policy's ECB meeting EUR, Bank of England Minutes GBP, BOE MPC Vote Hike GBP, BOE MPC Vote Unchanged GBP,BOE MPC Vote Cut GBP,Current Account (YoY) (Mar) EUR, Construction Output w.d.a (YoY) (Mar) EUR, Construction Output s.a (MoM) (Mar) EUR, ZEW Survey - Expectations (May) CHF, MBA Mortgage Applications (May 15) USD, Wholesale Sales (MoM) (Mar) CAD, EIA Crude Oil Stocks change (May 15) USD, FOMC Minutes USD, Visitor Arrivals (YoY) (Apr) NZD, Foreign investment in Japan stocks (May 15) JPY, Foreign bond investment (May 15) JPY
Trends in FII flows: The FIIs were net buyers of Rs. 480.6mn in the cash segment on Tuesday. The domestic institutional investors (DIIs) were net buyers of Rs. 4.51bn, as per the provisional figures released by the NSE.
In other news in the media:
Lloyd Electric & Engineering is looking to scale up advertising and marketing spends in order to increase market share in the room AC segment. The companys expenditure on brand building will go up by over 50% to Rs550m this fiscal. (BL)
NMDC Ltd has drawn up a growth plan to attain production of 100mn tonnes per annum by 2022 from the present production level of 30mn tonnes per annum, more than tripling its output. (BL)
Competition Commission of India has approved the acquisition of Alstoms India assets by General Electric as part of global deal. (BL)
Reliance Industries has raised US$200mn through a fresh issuance in Taiwan. The company raised 20-year debt paper on May 18. (ET)
Puravankara Projects announced a major restructuring in the company to achieve higher growth in sales and delivery of projects over the next five years. (ET)
Tata Steel said it has no immediate plans to sell-off its Long Products Europe business to the Switzerland-based Klesch Group. (BS)
Glenmark Pharmaceuticals has raised Rs9.45bn by issuing over 10mn shares to Aranda Investments, an indirect subsidiary of Temasek Holdings. (BL)
Hyundai Motor Group expressed its desire to expand its business into sectors like construction and railways in India, where it is currently the largest exporter of cars. (ET)
Bharti Airtel is all set to buy out Augere Wireless, 4G spectrum holder company in Madhya Pradesh circle, for about Rs1.5bn. (ET)
Syndicate Bank said it will raise up to Rs55.5bn from a mix of equity and bond to meet its capital requirements. (BL)
Tata Steel is in talks to buy Visa Steel's ferro chrome unit for ~Rs10bn to safeguard its chrome mining reserves by buying value adding facility. (ET)
Seeking to mobilize gold held by households and institutions, the government released a draft scheme under which a person or entity can earn interest by depositing the metal with banks. (BS)
Raising concern over central banks globally being pushed into "competitive monetary easing", RBI Governor said lower interest rates and tax incentives can boost investments, but it is consumer demand that holds the key for pushing economic growth. (ET)
India's economic growth is projected to surpass that of China's, with the GDP expected to zoom by 7.7% in 2016, according to a UN report which said India will help accelerate economic growth in South Asia. (ET)
In a bid to attract more foreign investment, the government is looking at doing away with the mandatory approval of the Reserve Bank of India which currently is needed after an investment proposal has been approved by the FIPB. (BS)
Retail inflation based on consumer price index for rural labourers eased to 5.49% in March from 6.19% in previous month. (ET)
Gains set in...Nifty gallops to end above 200-DMA
The Indian equity market started the week on a high as it closed with healthy gains. After opening higher, market was on a constant upswing. Buoyant buying in last 30-minutes of trade helped the key benchmark indices finish with solid gains.
The buying momentum was so fierce, that barring the Realty index all the other BSE sectoral indices ended in the green. The Consumer Durables and Oil & Gas index led from the front, followed by BSE Healthcare, FMCG and Capital Goods index.
"With Nifty closing above the 200 DMA, we expect the current recovery to continue; but Nifty needs to sustain above 8,350 for at least two weeks to confirm exhaustion of the selling pressure. Trend in investment activity of FIIs and movement in global markets will determine the near term trend on the domestic bourses. Corporate results on the other hand will continue to pour in with heavyweights like Tata Steel, Colgate and Bajaj Auto set to announce their earnings this week," said Amar Ambani, Head of Research, IIFL.
The market participants are expecting Reserve Bank of India to cut interest rates in June after forecast of a timely monsoon. Hopes have also been raised after Finance Minister Arun Jaitley said that his "expectation" from Governor Raghuram Rajan was the same as general expectation on interest rate cut.
The BSE Sensex opened almost 100 points higher at 27,417. Sustained buying support in energy, pharma and banking shares helped the benchmark index to trade higher for the rest of the trading day. However, a fresh round of buying in last 30-minutes of trade saw the BSE headline index to jump to a high of 27,726 - up 402 points from its previous close.
Finally, the Sensex ended with a gain of 363 points at 27,687.
Similarly, the late surge saw the NSE index soar to a high of 8,384 - up 123 points from its previous close. The Nifty eventually ended 111 points higher at 8,374.
The India VIX (Volatility) index declined by 9.7% to 17.90.
The broader market also finished with prominent gains. The CNX Midcap index spurted 0.8 percent to 13,080, and the Smallcap index jumped 1.2 percent to 5,488.
The breadth too was positive - out of 1,723 stocks traded on the NSE, 957 advanced and 505 declined today.
All the sectoral indices are ended on a positive note. The CNX Pharma and the CNX Energy indices rallied 1.6 percent each at 12,494 and 8,466, respectively. The Bank Nifty and the CNX FMCG index jumped 1.3 percent each at 18,415 and 20,264, respectively. The CNX IT index spurted nearly a percent at 11,279.
Only six stocks ended on a negative note, out of 50-Nifty stocks.
Zee Entertainment was top Nifty gainer - up 3.8 percent at Rs. 312 on the back of heavy volume. Around 1.4 lakh shares were traded in a multiple block at Rs. 300 - 300.15 on the NSE and BSE.
Dr.Reddy's Laboratories soared 3.7 percent at Rs. 3,265 on launching a new drug Somazina, a drug used to treat patients who suffer stroke.
Gail India, BPCL, UltraTech Cements, Ambuja Cements, Lupin and Tata Power jumped over 3 percent each.
Bharti Airtel ended with a gain of 1.8 percent at Rs. 399 after receiving financing commitments of up to $ 2.5 bn from China Development Bank and Industrial and Commercial Bank of China.
Wipro added over 1 percent at Rs. 544 on media reports that company is planning to setup an offshore delivery centre in China.
Asian Paints was the top Nifty loser - down 3.3 percent on reporting a lower-than expected earnings. The company reported 18.8 percent increase in Q4 net profit, which stood at Rs. 341 crore in Q4FY158, as against Rs. 287 crore in Q4FY14.
Tech Mahindra, Hero MotoCorp, Coal India, Tata Steel and Grasim Industries were the other losers.
Among other stocks - Shares of oil state-run oil market companies (OMCs) were in focus today on the back of fresh hike in fuel prices. According to media reports, the OMCs have increased the retail price of petrol by Rs 3.13 per litre and diesel by Rs 2.71 per litre, citing sharp increase in international prices. HPCL jumped 4 percent at Rs. 627, BPCL surged 3.3 percent at Rs. 791 and Indian Oil gained 2.7 percent at Rs. 345.
Apollo Tyres soared 8.8 percent at Rs. 186 on media reports that the company is planning to set up a subsidiary in Malaysia over the next two years in order to increase its global footprint and garner around 15 percent of the total revenues from exports.
Torrent Pharma slipped 2.4 percent at Rs. 1,227 on reporting 46.7 percent decline in Q4 net profit on year-on-year basis. The company booked a net profit of Rs. 130 crore in Q4FY15, as against Rs. 244 crore in Q4FY14.
Nestle India rallied to a high at Rs. 7,327 on the back of steady Q4 results. According to a release issued by the company over the weekend, Nestle India Q4 net profit rose by 23.5 percent to Rs. 320.28 crore when compared with Rs. 259.16 crore in the corresponding quarter a year ago. The stock today ended with a notable gain of 0.8 percent at Rs. 7,072.
Tata Coffee rallied 6.5 percent at Rs. 96 on reporting more than three-fold jump in Q4 net profit on year-on-year basis. The company booked a net profit of Rs. 43.66 crore for Q4FY15, as against Rs. 13.47 crore in a year ago period.
Gammon Infrastructure Projects ended on a strong note on reporting a net profit of Rs. 73.7 crore versus loss of Rs. 40.6 crore on year-on-year basis. The stock zoomed 13.1 percent to close at Rs. 12.58.
Sterlite Technologies added 4.3 percent at Rs. 66 on reporting almost four-fold jump in Q4 net profit, which stood at Rs. 39.13 crore, as against Rs. 10.15 crore in Q4FY14.
Jain Irrigation Systems zoomed 16.5 percent at Rs. 66.15 on reporting a net profit of Rs. 98.53 crore in Q4FY15, which jumped by 30.8 percent, when compared with Rs. 75.34 crore in a year ago period.
MIC Electronics zoomed to hit the 10 percent upper limit at Rs. 13.87 on the back of Q4 turnaround. The company reported a net profit of Rs. 13.81 crore for Q4FY15 when compared a net loss of RS. 18.87 crore in Q4FY14. The stock today ended with a surge of 4.8 percent at Rs. 13.22.
Astec Lifesciences ended at 20 percent upper circuit of Rs. 166 after the company recorded consolidated net profit of Rs. 3.25 crore in Q4FY15, as against Rs. 1.61 crore in Q4FY14.
Indraprastha Gas (IGL) gained 3 percent at Rs. 414 on the BSE on media reports that the company has hiked the selling price of CNG and PNG (piped natural gas) for auto and domestic consumers in Delhi from May 18, 2015.
Oracle Financial slipped to a low at Rs 3,418 on reporting 26 percent decline in consolidated net profit of Rs. 230 crore as against Rs. 310 crore in Q4FY14. The stock recovered most of its losses and ended with a marginal loss of 0.6 percent at Rs. 3,470.
A total of 26 stocks registered fresh 52-week high, while 39 stocks dropped to a new 52-week low on the NSE.
Adani Enterprises, Amtek India, Alembic Pharmaceuticals, Eicher Motors, Indo Count Industries, KNR Constructions, Mangalam Drugs & Organics, MIC Electronics, MIRC Electronics and Nilkamal were some of the prominent stocks at 52-week high.
3i Infotech, Bharti Shipyard, Bandhouse Retails, GSS Infotech, Gujarat NRE Coke, JCT Electronics, Jaypee Infratech, Jaiprakash Power Ventures, JSW Steel, KSK Energy Ventures, Manaksia Aluminium Company, Manaksia Industries, Manaksia Steels and NEPC India were some of the notable stocks at 52-week low.
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