The Reserve Bank of India (RBI) on Saturday unexpectedly cut its main short-term lending rate for the second time in as many weeks to ease a growing cash squeeze, spur faltering economic growth and fend off damage from the global financial crisis.
Analysts said the surprise RBI move, coming just a week after it left rates unchanged at a policy review, showed its concern that strains on Asia's third-largest economy were quickly becoming more severe.
"These actions were necessary (and had) to be taken on the liquidity front. And with call rates above 20 percent the situation was getting worse," said Vikas Agarwal, strategist at JP Morgan.
"The only question at this point of time which arises is why this was not taken at the time of the policy review last week and the only explanation is they did not anticipate the extent of the liquidity crunch," Agarwal added.
Policymakers around the world have slashed interest rates in recent weeks and injected huge amounts into their banking systems to try to combat the spillover effects of the global financial crisis, which is causing credit markets to freeze up and threatens to plunge the world economy into recession.
Analysts said the surprise move meant concerns over growth and cash tightness overrode inflationary issues but bankers said they would adopt a wait-and-see stance before deciding on lowering their lending and deposit rates.
V. Vaidyanathan, executive director at ICICI Bank the country's second biggest lender told CNBC-TV 18 the move was a welcome step to tide over the cash crunch but it won't rush into interest rate cuts immediately.
The RBI cut the repo rate or its main short-term lending rate by 50 basis points to 7.5 percent and banks' cash reserve requirements by 100 basis points to 5.5 percent.
SLOWING GROWTH
It also cut banks' bond reserve requirements by 1 percentage point to 24 percent of their deposits with effect from November 8, 2008, the central bank said in a notification posted on its website. www.rbi.org.in.
"The global financial turmoil has had knock-on effects on our financial markets; this has reinforced the importance of focusing on preserving financial stability," the central bank said.
The cut in its repo rate will take effect from Nov. 3.
The cut in banks' cash reserve requirements will take effect in two steps -- one from the fortnight beginning Oct 25 and the second from Nov 8 and will release 400 billion rupees ($81 billion) into the banking system.
Piyush Wadhwa, senior vice president, ICICI Securities said the 10-year bond yield could spike up by 5-10 basis points on Monday as result of the central bank move asking lenders to keep less of their deposits in federal debt but yields may ease in the medium term.
On Friday, the 10-year bond yield ended down 1 basis point at 7.50 percent.
India's economy has grown at or above 9 percent for the past three fiscal years, but is expected to grow by less than 8 percent this year as the global slowdown reduces exports. Industrial output grew at an annual rate of just 1.3 percent in August.
Rajeev Malik, economist at Macquarie Securities said the firm was cutting the country's growth estimates for the current year ending in March to 7.2 percent from the previous 7.5 percent due to the global market turmoil.
Overnight cash rates soared to a three-week high of 21 percent on Friday after outflows towards treasury bills drained cash from the system and banks scrambled to arrange funds for a the bond auction which took place earlier in the day.
The RBI move to cut rates on Saturday follows a 100 basis point cut in its main short-term lending rate early last week ahead of its scheduled review on Oct 24.
Saturday, November 1, 2008
BHARAT HEAVY ELECTRICALS LIMITED (FINANCIAL RESULTS – Q2, 2008-09)
HIGHLIGHTS
Performance of Bharat Heavy Electricals, the PSU power equipment major has beenmixed for the quarter ended Sep 2008. While the revenue for the quarter grew at 35% onan empirically weak quarter, the performance at operating level has been subdued withjust a growth of 2% on account of sharp 420 basis points contraction in operating marginto 13.3%. But the net profit eventually de-grew by 10% to Rs 615.8 crore.Order book of the company as end of Sep 2008 was Rs 104000 crore fortified by anorder intake of Rs 14350 crore in the Q2FY09. Order backlog as end of sequentialprevious quarter ended Jun ’08 was Rs 95000 crore and Rs 85000 crore as end of Mar’08
RESULT ANALYSIS
Revenue
On a empirically a weak quarter of Sep 2008, the company’s value of production (net of excise) stoodhigher by 33% to Rs 5763 crore on account of burnout of strong order book. The net sales for the quarterwere higher by 35% to Rs 5342.60 crore. Upside at revenue level mostly came from power segment asthe segment revenue growth of both Power and Industry have registered strong double digit growth forthe quarter.
Operating profit
Operating margin contracted by 420 basis points (bps) to 13.3%. While the other expenses were lower asa proportion to sales net of stocks, the staff cost and material cost were higher more than negating thegain at other expenses. Material cost was higher by 410 basis points to 62.6% and that of staff cost washigher by 90 basis points to 15.4%. However the other expenses were lower by 130 basis points to 9.7%.This led to a marginal growth in operating profit of 2% to Rs.710.7 crore against Rs.695.2 crore in thecorresponding previous quarter.
Net Profit
Other income (excluding the interest on income tax refund for earlier years amounting Rs 250 crore in Q2FY08 & was taken to EO) grew by 22% to Rs 307.20 crore. Interest cost was lower by 89% to Rs 2.20crore and depreciation was up by 7% to Rs 74.3 crore. Spurred by higher other income, the growth atPBT level improved to 10% (to Rs 941.40 crore).EO item for the quarter was nil compared to Rs 250 crore in the corresponding previous period onaccount of interest on income tax refund pertaining to earlier years. On an escalated base the PBT afterEO was lower by 15% to Rs 941.4 crore. Taxation was lower by 16% to Rs 325.60 crore and Prior periodadjustments for the quarter was nil as against Rs 31 crore in the corresponding previous period. Thus thenet profit eventually closed at Rs 615.80 crore, a fall of 10%
Performance of Bharat Heavy Electricals, the PSU power equipment major has beenmixed for the quarter ended Sep 2008. While the revenue for the quarter grew at 35% onan empirically weak quarter, the performance at operating level has been subdued withjust a growth of 2% on account of sharp 420 basis points contraction in operating marginto 13.3%. But the net profit eventually de-grew by 10% to Rs 615.8 crore.Order book of the company as end of Sep 2008 was Rs 104000 crore fortified by anorder intake of Rs 14350 crore in the Q2FY09. Order backlog as end of sequentialprevious quarter ended Jun ’08 was Rs 95000 crore and Rs 85000 crore as end of Mar’08
RESULT ANALYSIS
Revenue
On a empirically a weak quarter of Sep 2008, the company’s value of production (net of excise) stoodhigher by 33% to Rs 5763 crore on account of burnout of strong order book. The net sales for the quarterwere higher by 35% to Rs 5342.60 crore. Upside at revenue level mostly came from power segment asthe segment revenue growth of both Power and Industry have registered strong double digit growth forthe quarter.
Operating profit
Operating margin contracted by 420 basis points (bps) to 13.3%. While the other expenses were lower asa proportion to sales net of stocks, the staff cost and material cost were higher more than negating thegain at other expenses. Material cost was higher by 410 basis points to 62.6% and that of staff cost washigher by 90 basis points to 15.4%. However the other expenses were lower by 130 basis points to 9.7%.This led to a marginal growth in operating profit of 2% to Rs.710.7 crore against Rs.695.2 crore in thecorresponding previous quarter.
Net Profit
Other income (excluding the interest on income tax refund for earlier years amounting Rs 250 crore in Q2FY08 & was taken to EO) grew by 22% to Rs 307.20 crore. Interest cost was lower by 89% to Rs 2.20crore and depreciation was up by 7% to Rs 74.3 crore. Spurred by higher other income, the growth atPBT level improved to 10% (to Rs 941.40 crore).EO item for the quarter was nil compared to Rs 250 crore in the corresponding previous period onaccount of interest on income tax refund pertaining to earlier years. On an escalated base the PBT afterEO was lower by 15% to Rs 941.4 crore. Taxation was lower by 16% to Rs 325.60 crore and Prior periodadjustments for the quarter was nil as against Rs 31 crore in the corresponding previous period. Thus thenet profit eventually closed at Rs 615.80 crore, a fall of 10%
Friday, October 31, 2008
Nestle India declares second interim dividend
The board of Nestle India has declared second interim dividend at the rate of Rs 14.50 per share for 2008 and special dividend at the rate of Rs 7.50 per share.
This was declared at the board meeting held on 31 October 2008.
This was declared at the board meeting held on 31 October 2008.
Post Market Report:31/10/2008
A steep rate cut by the US Federal Reserve, decline in inflation
for the fifth successive week and market buzz the government is
considering more measures to pump in liquidity in the financial
system, triggered a solid surge on the bourses. The BSE Sensex
jumped 743.55 points or 8.22%.
After a strong rally in mid-morning trade, the market came off the
higher level on weak opening of the European markets only to bounce
back again in late trade. Bank stocks spurted on fall in inflation.
IT stocks jumped on rise in American depository receipts (ADR)
overnight. The market breadth was strong indicating a broad-based
buying.
The wholesale price index (WPI)-based year-on-year inflation
dropped to 10.68% in the week ended 18 October from 11.07% in the
previous week. Following the steady decline in headline inflation,
economists expect inflation to enter single digit domain by
end-November 2008.
Global markets had rallied on Thursday, 30 October 2008, after the
US Federal Reserve cut its main policy rate to 1% on Wednesday, 29
October 2008, to stave off the credit crunch. The Indian market was
closed on Thursday on for a public holiday and therefore it reacted
to the global rally today.
The BSE 30-share Sensex was up 743.55 points or 8.22% to 9,788.06.
The index jumped 825.91 points at the day's high of 9.870.42 in
late trade. The Sensex rose 317.15 points at day's low of 9,361.66
in early trade.
The S&P CNX Nifty was up 188.55 points or 6.99% to 2,885.60.
There has been a massive erosion in investors' wealth this year.
The barometer index BSE Sensex is down 10.498.93 points or 51.75%
in the calendar year 2008 so far from its close of 20,286.99 on 31
December 2007. It is 11,418.71 points or 53.84% below its all-time
high of 21,206.77 struck on 10 January 2008.
BSE clocked a turnover of Rs 3,699 crore today, 31 October 2008 as
compared to a turnover of Rs 3,104.10 on 29 October 2008.
Nifty November 2008 futures were at 2915, at a premium of 29.40
points as compared to spot closing of 2885.60. NSE's futures &
options (F&O) segment turnover was Rs 36,959.23 crore, which was
lower than Rs 54,223.24 crore on Wednesday, 29 October 2008.
The BSE Mid-Cap index was up 3.41% at 3,200.02 and the BSE
Small-Cap index was up 2.46% at 3,765.11. Both the indices
underperformed the Sensex.
The BSE Metal index (up 10.2% to 5,367.60), the BSE Oil & Gas index
(up 9.11% to 6,195.62) outperformed the Sensex.
The BSE Bankex (up 7.21% to 5,011.24), the BSE Teck index (up 6.6%
to 2,161.45),the BSE Auto index (up 6.39% to 2,685.62), the BSE IT
index (up 5.77% to 2,861.94), the BSE Power index (up 5.54% to
1,583.37), the BSE Capital Goods index (up 5% to 7,017.61), the BSE
FMCG index (up 3.32% to 1,799.83), the BSE HealthCare index (up
3.23% to 2,778.64), the BSE PSU index (up 2.74% to 4,564.92), the
BSE Realty index (up 2.3% to 1,978.24) and the BSE Consumer
Durables index (up 2.25% to 2,072.98) underperformed the Sensex.
The market breadth was strong. On BSE, 1577 shares advanced as
compared to 916 that declined. 82 shares remained unchanged.
India's largest private sector company by market capitalization and
oil refiner Reliance Industries (RIL) surged 13.81% to Rs 1,37.75,
after the petroleum ministry said the $4.20 per metric million
British thermal units (mmBtu) price fixed by an empowered group of
ministers for gas from Reliance Industries' KG-D6 was only for the
purpose of valuation of government share and the selling price
could be higher.
Jaiprakash Associates (up 16.55% to Rs 71.85) and Tata Power
Company (up 11.86% to Rs 689.65) were from the major gainers from
the Sensex pack.
India's largest drug maker by sales Ranbaxy Laboratories fell 1.97%
to Rs 169.45, off day's high of Rs 200. The company reported a net
loss of Rs 352.93 crore in Q3 September 2008 compared to a net
profit of Rs 168.15 crore in Q3 September 2007. It announced the
result after the market hours today.
Telecom stocks rose after mixed Q2 results. India's largest telecom
service provider by sales Reliance Communications jumped 13.76% as
net profit on consolidated basis, rose 17.33% to Rs 1530.78 crore
on 23.29% rise in total income to Rs 5645 crore in Q2 September
2008 over Q2 September 2007.
India's largest telecom service provider by market share Bharti
Airtel rose 5.52% despite a 0.9% fall in net profit to Rs 1604.78
crore on 35.6% rise in total income to Rs 8302.8 crore in Q2
September 2008 over Q2 September 2007.
India's largest real estate major by market capitalization DLF
gained 8.79% ahead of Q2 September 2008 result today.
Metal stocks shrugged off fall in metal prices on the London Metal
Exchange yesterday, 30 October 2008 triggered by fears of fall in
demand as the US economy shrank at a 0.3% annual rate in the third
quarter, its sharpest contraction in seven years. Tata Steel,
Hindustan Zinc, Sterlite Indusries rose by between 0.13% to 14.48%.
India's second largest steel maker by sales Steel Authority of
India fell 0.18%.
India's largest aluminum maker by sales Hindalco Industries jumped
13.26% as net profit rose 13.26% to Rs 719.95 crore on 15.42% rise
in total income to Rs 5,859.95 crore in Q2 September 2008 over Q2
September 2007. State-run aluminium major National Aluminium
Company (Nalco) jumped 7.43% after net profit rose 1.07% to Rs
444.46 crore on 12.3% growth in total income to Rs 1654.50 crore in
Q2 September 2008 over Q2 September 2007.
Banking stocks jumped as the fifth successive week of decline in
inflation has given more room for the central bank to cut rates.
The BSE's banking sector index Bankex rose 7.21% and was the third
biggest gainer form the sectoral indices on BSE. India's largest
private sector bank by net profit ICICI Bank jumped 15.5% as ADR
spurted 13.64% overnight. India's largest commercial bank State
Bank of India rose 0.79%.
India's second largest private sector bank by net profit HDFC Bank
gained 8.29% to Rs 981 off day's high of Rs 1,059, as ADR soared
11.38% overnight.
ICICI Bank, State Bank of India and HDFC Bank have a weightage of
24.21%, 22.44% and 20.55%, respectively in the BSE Bankex.
Punjab National Bank rose 4.56% on 31.3% rise in net profit to Rs
707.09 crore on 35.1% rise in total income to Rs 5313.18 crore in
Q2 September 2008 over Q2 September 2007.
Kotak Mahindra Bank rose 3.1% even as net profit fell 36.50% to Rs
47.86 crore in Q2 September 2008 over Q2 September 2007.
India's largest home loan lender by sales HDFC rose 17.48%.
There is speculation and anticipation in the market that the
Reserve Bank of India may cut cash reserve ratio (CRR) -- the cash
deposits that banks are required to keep with the central bank -- by
one percentage point from the existing 6.5% to 5.5%.
IT stocks gained as rally in ADRs offset a stronger rupee. India's
third largest IT exporter by sales Satyam Computer Services rose
7.61%, as ADR rose 7.61%. India's fourth largest IT exporter by
sales Wipro rose 6.16%, as ADR jumped 7.78%. India's second largest
IT exporter by sales Infosys gained 6.06%, as ADR jumped 4.98%.
India's largest IT exporter by sales Tata Consultancy Services fell
0.93%.
The Indian rupee crept higher in opening deals on Friday on
expectations the local stock market will rise and help revive
investor appetite. The partially convertible rupee was at 49.50 per
dollar, 0.4% stronger than Wednesday's close of 49.69/70 per
dollar. A stronger rupee affects IT firms negatively as they earn
most of their revenues in dollar terms.
PSU OMCs fell as weak results by BPCL and Indian Oil Corporation
offset fall of crude oil prices. Bharat Petroleum Corporation
declined 7.12% after the company reported a net loss of Rs 2625.27
crore in Q2 September 2008 as compared to net profit of Rs 1038.16
crore in Q2 September 2007.
Indian Oil Corporation declined 3.05% after the company reported a
net loss of Rs 7047.13 crore in Q2 September 2008 as compared to
net profit of Rs 3817.75 crore in Q2 September 2007.
US crude oil futures by more than $2 a barrel to below $64 a barrel
on Friday after bearish U.S. economic data rekindled worries about
falling demand. Lower oil prices will reduce underrecoveries at the
state-run oil firms on domestic sale of petrol, diesel, LPG and
kerosene at a controlled price., diesel, LPG and kerosene at a
controlled price.
India's largest oil exploration firm by revenue ONGC rose 3.04%
despite a 5.7% fall in net profit to Rs 4808 crore in Q2 September
2008 over Q2 September 2007 caused by a steep rise in the subsidy
burden.
Cairn India galloped 10.85% after the company reported a net profit
of Rs 81.44 crore in Q3 September 2008 as compared to net loss of
Rs 8.39 crore in Q3 September 2007.
Aban Offshore jumped 13.2% as net profit surged 72.3% to Rs 81.34
crore in Q2 September 2008 over Q2 September 2007.
Essar Oil surged 11.1% on posting a net profit of Rs 26 crore in Q2
September 2008 compared to a net loss of Rs 14 crore in Q2
September 2007.
Cement stocks rose despite south based India Cements posting weak
results. India Cements surged 15.83% even as net profit fell 39.69%
to Rs 134.27 crore on 23% rise in total income to Rs 1096.59 crore
in Q2 September 2008 over Q2 September 2007. ACC, Ultratech
Cements, Grasim Industries and Birla Corporation rose by between
0.21% to 5.49%.
Rate sensitive auto stocks jumped on hopes lower interest rates.
Maruti Suzuki India, Mahindra & Mahindra gained by between 4% to
23.09%. However, India's largest motorbike maker by sales Hero
Honda Motors fell 1.42%. Lower interest rates may spur auto sales
which are largely driven through finance.
India's largest commercial vehicle maker by sales Tata motors rose
9.11% on a lower-than-expected 34.13% fall in net profit to Rs
346.99 crore in Q2 September 2008 over Q2 September 2007.
Realty stocks were mixed amid a capital crunch being faced by
realty firms. Indiabulls Real Estate and Unitech fell by between
3.27% to 3.71%. India's largest real estate major by market
capitalization DLF gained 8.79% ahead of Q2 September2008 result
today.
IVRCL Infrastructure & Projects surged 6.68% as net profit rose
61.98% to Rs 57.10 crore in Q2 September 2008 over Q2 September
2007.
Suzlon Energy fell 3.79% on reports of initiating talks with
private equity firms for sale of shares to raise funds
EID Parry India gained 4.43% after the company reported net profit
of Rs 611.89 crore in Q2 September 2008 as compared to a net loss
of Rs 5.74 crore in Q2 September 2007.
Rashtriya Chemicals & Fertilizers moved up 3.26% as net profit
surged 116.6% to Rs 84.37 crore in Q2 September 2008 over Q2
September 2007.
Tata Chemicals surged 18.1% as net profit jumped 51.39% to Rs
215.80 crore in Q2 September 2008 over Q2 September 2007.
MMTC rose 1.45% as net profit rose 24.98% to Rs 46.78 crore on
110.92% rise in total income to Rs 12497.23 crore in Q2 September
2008 over Q2 September 2007.
Kirloskar Electric Company rose 4.16% after the company decided to
set up a manufacturing unit for AC motors and AC generators.
Suzlon Energy clocked the highest volume of 1.68 crore shares on
BSE. Hindalco Industries (1.34 crore shares), Reliance Petroleum (1
crore shares), Unitech (84.98 lakh shares) and Core Projects &
Infrastructure (81.36 lakh shares) were the other volume toppers in
that order.
Reliance Industries clocked the highest turnover of Rs 435.8o crore
on BSE. Reliance Capital (Rs 186.92 crore), ICICI Bank (Rs 170.56
crore), State Bank of India (Rs 148.38 crore) and Reliance
Communications (Rs 135.56 crore) were the other turnover toppers in
that order.
European stocks fell as on concerns about the global economy
weighed on investors. Key benchmark indices in France, Germany and
UK were down by between 0.16% to 2.18%.
Japan's Nikkei average dropped 5% after a lower-than-expected 20
basis points cut in interest rate announced by Bank of Japan today,
31 October 2008. While Japanese stocks tumbled, other Asian stocks
were trading mixed. Key benchmark indices in China, Singapore and
Hong Kong, fell by between 0.66% to 3.09%. However, South Korea and
Taiwan rose by between 2.61% to 3.99%.
China cut rates on Wednesday, 29 October 2008 with Taiwan and Hong
Kong following up with rate cuts on Thursday.
for the fifth successive week and market buzz the government is
considering more measures to pump in liquidity in the financial
system, triggered a solid surge on the bourses. The BSE Sensex
jumped 743.55 points or 8.22%.
After a strong rally in mid-morning trade, the market came off the
higher level on weak opening of the European markets only to bounce
back again in late trade. Bank stocks spurted on fall in inflation.
IT stocks jumped on rise in American depository receipts (ADR)
overnight. The market breadth was strong indicating a broad-based
buying.
The wholesale price index (WPI)-based year-on-year inflation
dropped to 10.68% in the week ended 18 October from 11.07% in the
previous week. Following the steady decline in headline inflation,
economists expect inflation to enter single digit domain by
end-November 2008.
Global markets had rallied on Thursday, 30 October 2008, after the
US Federal Reserve cut its main policy rate to 1% on Wednesday, 29
October 2008, to stave off the credit crunch. The Indian market was
closed on Thursday on for a public holiday and therefore it reacted
to the global rally today.
The BSE 30-share Sensex was up 743.55 points or 8.22% to 9,788.06.
The index jumped 825.91 points at the day's high of 9.870.42 in
late trade. The Sensex rose 317.15 points at day's low of 9,361.66
in early trade.
The S&P CNX Nifty was up 188.55 points or 6.99% to 2,885.60.
There has been a massive erosion in investors' wealth this year.
The barometer index BSE Sensex is down 10.498.93 points or 51.75%
in the calendar year 2008 so far from its close of 20,286.99 on 31
December 2007. It is 11,418.71 points or 53.84% below its all-time
high of 21,206.77 struck on 10 January 2008.
BSE clocked a turnover of Rs 3,699 crore today, 31 October 2008 as
compared to a turnover of Rs 3,104.10 on 29 October 2008.
Nifty November 2008 futures were at 2915, at a premium of 29.40
points as compared to spot closing of 2885.60. NSE's futures &
options (F&O) segment turnover was Rs 36,959.23 crore, which was
lower than Rs 54,223.24 crore on Wednesday, 29 October 2008.
The BSE Mid-Cap index was up 3.41% at 3,200.02 and the BSE
Small-Cap index was up 2.46% at 3,765.11. Both the indices
underperformed the Sensex.
The BSE Metal index (up 10.2% to 5,367.60), the BSE Oil & Gas index
(up 9.11% to 6,195.62) outperformed the Sensex.
The BSE Bankex (up 7.21% to 5,011.24), the BSE Teck index (up 6.6%
to 2,161.45),the BSE Auto index (up 6.39% to 2,685.62), the BSE IT
index (up 5.77% to 2,861.94), the BSE Power index (up 5.54% to
1,583.37), the BSE Capital Goods index (up 5% to 7,017.61), the BSE
FMCG index (up 3.32% to 1,799.83), the BSE HealthCare index (up
3.23% to 2,778.64), the BSE PSU index (up 2.74% to 4,564.92), the
BSE Realty index (up 2.3% to 1,978.24) and the BSE Consumer
Durables index (up 2.25% to 2,072.98) underperformed the Sensex.
The market breadth was strong. On BSE, 1577 shares advanced as
compared to 916 that declined. 82 shares remained unchanged.
India's largest private sector company by market capitalization and
oil refiner Reliance Industries (RIL) surged 13.81% to Rs 1,37.75,
after the petroleum ministry said the $4.20 per metric million
British thermal units (mmBtu) price fixed by an empowered group of
ministers for gas from Reliance Industries' KG-D6 was only for the
purpose of valuation of government share and the selling price
could be higher.
Jaiprakash Associates (up 16.55% to Rs 71.85) and Tata Power
Company (up 11.86% to Rs 689.65) were from the major gainers from
the Sensex pack.
India's largest drug maker by sales Ranbaxy Laboratories fell 1.97%
to Rs 169.45, off day's high of Rs 200. The company reported a net
loss of Rs 352.93 crore in Q3 September 2008 compared to a net
profit of Rs 168.15 crore in Q3 September 2007. It announced the
result after the market hours today.
Telecom stocks rose after mixed Q2 results. India's largest telecom
service provider by sales Reliance Communications jumped 13.76% as
net profit on consolidated basis, rose 17.33% to Rs 1530.78 crore
on 23.29% rise in total income to Rs 5645 crore in Q2 September
2008 over Q2 September 2007.
India's largest telecom service provider by market share Bharti
Airtel rose 5.52% despite a 0.9% fall in net profit to Rs 1604.78
crore on 35.6% rise in total income to Rs 8302.8 crore in Q2
September 2008 over Q2 September 2007.
India's largest real estate major by market capitalization DLF
gained 8.79% ahead of Q2 September 2008 result today.
Metal stocks shrugged off fall in metal prices on the London Metal
Exchange yesterday, 30 October 2008 triggered by fears of fall in
demand as the US economy shrank at a 0.3% annual rate in the third
quarter, its sharpest contraction in seven years. Tata Steel,
Hindustan Zinc, Sterlite Indusries rose by between 0.13% to 14.48%.
India's second largest steel maker by sales Steel Authority of
India fell 0.18%.
India's largest aluminum maker by sales Hindalco Industries jumped
13.26% as net profit rose 13.26% to Rs 719.95 crore on 15.42% rise
in total income to Rs 5,859.95 crore in Q2 September 2008 over Q2
September 2007. State-run aluminium major National Aluminium
Company (Nalco) jumped 7.43% after net profit rose 1.07% to Rs
444.46 crore on 12.3% growth in total income to Rs 1654.50 crore in
Q2 September 2008 over Q2 September 2007.
Banking stocks jumped as the fifth successive week of decline in
inflation has given more room for the central bank to cut rates.
The BSE's banking sector index Bankex rose 7.21% and was the third
biggest gainer form the sectoral indices on BSE. India's largest
private sector bank by net profit ICICI Bank jumped 15.5% as ADR
spurted 13.64% overnight. India's largest commercial bank State
Bank of India rose 0.79%.
India's second largest private sector bank by net profit HDFC Bank
gained 8.29% to Rs 981 off day's high of Rs 1,059, as ADR soared
11.38% overnight.
ICICI Bank, State Bank of India and HDFC Bank have a weightage of
24.21%, 22.44% and 20.55%, respectively in the BSE Bankex.
Punjab National Bank rose 4.56% on 31.3% rise in net profit to Rs
707.09 crore on 35.1% rise in total income to Rs 5313.18 crore in
Q2 September 2008 over Q2 September 2007.
Kotak Mahindra Bank rose 3.1% even as net profit fell 36.50% to Rs
47.86 crore in Q2 September 2008 over Q2 September 2007.
India's largest home loan lender by sales HDFC rose 17.48%.
There is speculation and anticipation in the market that the
Reserve Bank of India may cut cash reserve ratio (CRR) -- the cash
deposits that banks are required to keep with the central bank -- by
one percentage point from the existing 6.5% to 5.5%.
IT stocks gained as rally in ADRs offset a stronger rupee. India's
third largest IT exporter by sales Satyam Computer Services rose
7.61%, as ADR rose 7.61%. India's fourth largest IT exporter by
sales Wipro rose 6.16%, as ADR jumped 7.78%. India's second largest
IT exporter by sales Infosys gained 6.06%, as ADR jumped 4.98%.
India's largest IT exporter by sales Tata Consultancy Services fell
0.93%.
The Indian rupee crept higher in opening deals on Friday on
expectations the local stock market will rise and help revive
investor appetite. The partially convertible rupee was at 49.50 per
dollar, 0.4% stronger than Wednesday's close of 49.69/70 per
dollar. A stronger rupee affects IT firms negatively as they earn
most of their revenues in dollar terms.
PSU OMCs fell as weak results by BPCL and Indian Oil Corporation
offset fall of crude oil prices. Bharat Petroleum Corporation
declined 7.12% after the company reported a net loss of Rs 2625.27
crore in Q2 September 2008 as compared to net profit of Rs 1038.16
crore in Q2 September 2007.
Indian Oil Corporation declined 3.05% after the company reported a
net loss of Rs 7047.13 crore in Q2 September 2008 as compared to
net profit of Rs 3817.75 crore in Q2 September 2007.
US crude oil futures by more than $2 a barrel to below $64 a barrel
on Friday after bearish U.S. economic data rekindled worries about
falling demand. Lower oil prices will reduce underrecoveries at the
state-run oil firms on domestic sale of petrol, diesel, LPG and
kerosene at a controlled price., diesel, LPG and kerosene at a
controlled price.
India's largest oil exploration firm by revenue ONGC rose 3.04%
despite a 5.7% fall in net profit to Rs 4808 crore in Q2 September
2008 over Q2 September 2007 caused by a steep rise in the subsidy
burden.
Cairn India galloped 10.85% after the company reported a net profit
of Rs 81.44 crore in Q3 September 2008 as compared to net loss of
Rs 8.39 crore in Q3 September 2007.
Aban Offshore jumped 13.2% as net profit surged 72.3% to Rs 81.34
crore in Q2 September 2008 over Q2 September 2007.
Essar Oil surged 11.1% on posting a net profit of Rs 26 crore in Q2
September 2008 compared to a net loss of Rs 14 crore in Q2
September 2007.
Cement stocks rose despite south based India Cements posting weak
results. India Cements surged 15.83% even as net profit fell 39.69%
to Rs 134.27 crore on 23% rise in total income to Rs 1096.59 crore
in Q2 September 2008 over Q2 September 2007. ACC, Ultratech
Cements, Grasim Industries and Birla Corporation rose by between
0.21% to 5.49%.
Rate sensitive auto stocks jumped on hopes lower interest rates.
Maruti Suzuki India, Mahindra & Mahindra gained by between 4% to
23.09%. However, India's largest motorbike maker by sales Hero
Honda Motors fell 1.42%. Lower interest rates may spur auto sales
which are largely driven through finance.
India's largest commercial vehicle maker by sales Tata motors rose
9.11% on a lower-than-expected 34.13% fall in net profit to Rs
346.99 crore in Q2 September 2008 over Q2 September 2007.
Realty stocks were mixed amid a capital crunch being faced by
realty firms. Indiabulls Real Estate and Unitech fell by between
3.27% to 3.71%. India's largest real estate major by market
capitalization DLF gained 8.79% ahead of Q2 September2008 result
today.
IVRCL Infrastructure & Projects surged 6.68% as net profit rose
61.98% to Rs 57.10 crore in Q2 September 2008 over Q2 September
2007.
Suzlon Energy fell 3.79% on reports of initiating talks with
private equity firms for sale of shares to raise funds
EID Parry India gained 4.43% after the company reported net profit
of Rs 611.89 crore in Q2 September 2008 as compared to a net loss
of Rs 5.74 crore in Q2 September 2007.
Rashtriya Chemicals & Fertilizers moved up 3.26% as net profit
surged 116.6% to Rs 84.37 crore in Q2 September 2008 over Q2
September 2007.
Tata Chemicals surged 18.1% as net profit jumped 51.39% to Rs
215.80 crore in Q2 September 2008 over Q2 September 2007.
MMTC rose 1.45% as net profit rose 24.98% to Rs 46.78 crore on
110.92% rise in total income to Rs 12497.23 crore in Q2 September
2008 over Q2 September 2007.
Kirloskar Electric Company rose 4.16% after the company decided to
set up a manufacturing unit for AC motors and AC generators.
Suzlon Energy clocked the highest volume of 1.68 crore shares on
BSE. Hindalco Industries (1.34 crore shares), Reliance Petroleum (1
crore shares), Unitech (84.98 lakh shares) and Core Projects &
Infrastructure (81.36 lakh shares) were the other volume toppers in
that order.
Reliance Industries clocked the highest turnover of Rs 435.8o crore
on BSE. Reliance Capital (Rs 186.92 crore), ICICI Bank (Rs 170.56
crore), State Bank of India (Rs 148.38 crore) and Reliance
Communications (Rs 135.56 crore) were the other turnover toppers in
that order.
European stocks fell as on concerns about the global economy
weighed on investors. Key benchmark indices in France, Germany and
UK were down by between 0.16% to 2.18%.
Japan's Nikkei average dropped 5% after a lower-than-expected 20
basis points cut in interest rate announced by Bank of Japan today,
31 October 2008. While Japanese stocks tumbled, other Asian stocks
were trading mixed. Key benchmark indices in China, Singapore and
Hong Kong, fell by between 0.66% to 3.09%. However, South Korea and
Taiwan rose by between 2.61% to 3.99%.
China cut rates on Wednesday, 29 October 2008 with Taiwan and Hong
Kong following up with rate cuts on Thursday.
Ugly October ends with an upbeat day on Wall St
U.S. stocks ended one of their worst months on record, but signs of further thawing in credit markets lifted battered shares on Friday.
Hammered by worries over the extent of the damage the credit crunch has inflicted on the global economy, the Dow Jones industrial average logged its biggest monthly decline in a decade, while the S&P 500 had its worst month since the October 1987 market crash.
Financial shares, led by a gain of almost 10 percent in JPMorgan Chase, lifted Wall Street as the interest rate that banks charge each other for short-term loans continued to ease.
The decrease in overnight interbank borrowing costs prompted hopes that global efforts to bolster confidence in credit markets are taking hold following the Federal Reserve's interest-rate cut earlier this week and spurred investors to search for bargains.
"It seems like you have some continued mild improvement in the credit markets and that seems to be buoying hopes but people should know, conditions may have improved, but they're improving slowly," said Chip Hanlon, president of Delta Global Advisors Inc, in Huntington Beach, California.
The Dow Jones industrial average gained 144.32 points, or 1.57 percent, to 9,325.01. The Standard & Poor's 500 Index rose 14.66 points, or 1.54 percent, to 968.75. The Nasdaq Composite Index climbed 22.43 points, or 1.32 percent, to 1,720.95.
Friday's rally resulted in stocks clocking in a higher finish for two sessions in a row -- the first consecutive gains in over a month.
For the week, the Dow gained 11.3 percent, its best one-week percentage gain since October 1974. The S&P 500 rose 10.5 percent, its best weekly percentage gain since at least January 1980. The Nasdaq advanced 10.9 percent, its best weekly percentage gain since April 2001.
October, though, was a different story. The Dow lost 14.06 percent, its worst one-month percentage drop since August 1998, while the S&P 500 lost 16.83 percent, its worst one-month percentage slide since October 1987.
Pension funds bought stocks to rebalance their portfolios, also lending support to the market, traders noted.
JPMorgan said it is making changes to about $110 billion in mortgages and is temporarily halting foreclosures while it alters the loans. The bank's stock, a Dow component, shot up 9.7 percent, or $3.63, to $41.25 on the New York Stock Exchange.
Among other financial shares, Morgan Stanley rose 8.6 percent to $17.47., while the S&P Financial Index gained 5.5 percent.
But economic data on Friday that showed U.S. consumers are tightening their belts offered more evidence of a deep slowdown, though the market appeared to shrug it off.
U.S. consumers cut their monthly spending for the first time in two years during September, according to a U.S. Commerce Department report.
On Nasdaq, video game publisher Electronic Arts Inc shed 17.9 percent to $22.78 after it chopped its full-year profit forecast due to slowing demand.
After trading on both the up and down side of Friday's ledger, Chevron Corp ended up 0.6 percent at $74.60 on the NYSE after it reported quarterly profit that beat expectations. The price of oil, which had slipped earlier and pressured the stock, also rebounded. U.S. crude gained $1.85 to settle at $67.81 a barrel on the New York Mercantile Exchange, but recorded its biggest monthly drop ever. In October, the price of NYMEX crude fell a record 32.62 percent.
Shares of Express Scripts Inc jumped 5.3 percent to $60.61 on Nasdaq after the pharmacy benefit manager reported quarterly profit that beat expectations after Thursday's closing bell.
In other economic news, an index of consumer sentiment suffered its steepest monthly drop on record, according to the Reuters/University of Michigan Surveys of Consumers' final reading for October.
And the Chicago Purchasing Management Index showed that business activity in the Midwest came to a halt in October as production and new orders plummeted.
Trading was moderate on the New York Stock Exchange, with about 1.57 billion shares changing hands, below last year's estimated daily average of roughly 1.90 billion, while on Nasdaq, about 2.50 billion shares traded, above last year's daily average of 2.17 billion.
Advancing stocks outnumbered declining ones on both the NYSE and the Nasdaq by a ratio of nearly 3 to 1.
Hammered by worries over the extent of the damage the credit crunch has inflicted on the global economy, the Dow Jones industrial average logged its biggest monthly decline in a decade, while the S&P 500 had its worst month since the October 1987 market crash.
Financial shares, led by a gain of almost 10 percent in JPMorgan Chase, lifted Wall Street as the interest rate that banks charge each other for short-term loans continued to ease.
The decrease in overnight interbank borrowing costs prompted hopes that global efforts to bolster confidence in credit markets are taking hold following the Federal Reserve's interest-rate cut earlier this week and spurred investors to search for bargains.
"It seems like you have some continued mild improvement in the credit markets and that seems to be buoying hopes but people should know, conditions may have improved, but they're improving slowly," said Chip Hanlon, president of Delta Global Advisors Inc, in Huntington Beach, California.
The Dow Jones industrial average gained 144.32 points, or 1.57 percent, to 9,325.01. The Standard & Poor's 500 Index rose 14.66 points, or 1.54 percent, to 968.75. The Nasdaq Composite Index climbed 22.43 points, or 1.32 percent, to 1,720.95.
Friday's rally resulted in stocks clocking in a higher finish for two sessions in a row -- the first consecutive gains in over a month.
For the week, the Dow gained 11.3 percent, its best one-week percentage gain since October 1974. The S&P 500 rose 10.5 percent, its best weekly percentage gain since at least January 1980. The Nasdaq advanced 10.9 percent, its best weekly percentage gain since April 2001.
October, though, was a different story. The Dow lost 14.06 percent, its worst one-month percentage drop since August 1998, while the S&P 500 lost 16.83 percent, its worst one-month percentage slide since October 1987.
Pension funds bought stocks to rebalance their portfolios, also lending support to the market, traders noted.
JPMorgan said it is making changes to about $110 billion in mortgages and is temporarily halting foreclosures while it alters the loans. The bank's stock, a Dow component, shot up 9.7 percent, or $3.63, to $41.25 on the New York Stock Exchange.
Among other financial shares, Morgan Stanley rose 8.6 percent to $17.47., while the S&P Financial Index gained 5.5 percent.
But economic data on Friday that showed U.S. consumers are tightening their belts offered more evidence of a deep slowdown, though the market appeared to shrug it off.
U.S. consumers cut their monthly spending for the first time in two years during September, according to a U.S. Commerce Department report.
On Nasdaq, video game publisher Electronic Arts Inc shed 17.9 percent to $22.78 after it chopped its full-year profit forecast due to slowing demand.
After trading on both the up and down side of Friday's ledger, Chevron Corp ended up 0.6 percent at $74.60 on the NYSE after it reported quarterly profit that beat expectations. The price of oil, which had slipped earlier and pressured the stock, also rebounded. U.S. crude gained $1.85 to settle at $67.81 a barrel on the New York Mercantile Exchange, but recorded its biggest monthly drop ever. In October, the price of NYMEX crude fell a record 32.62 percent.
Shares of Express Scripts Inc jumped 5.3 percent to $60.61 on Nasdaq after the pharmacy benefit manager reported quarterly profit that beat expectations after Thursday's closing bell.
In other economic news, an index of consumer sentiment suffered its steepest monthly drop on record, according to the Reuters/University of Michigan Surveys of Consumers' final reading for October.
And the Chicago Purchasing Management Index showed that business activity in the Midwest came to a halt in October as production and new orders plummeted.
Trading was moderate on the New York Stock Exchange, with about 1.57 billion shares changing hands, below last year's estimated daily average of roughly 1.90 billion, while on Nasdaq, about 2.50 billion shares traded, above last year's daily average of 2.17 billion.
Advancing stocks outnumbered declining ones on both the NYSE and the Nasdaq by a ratio of nearly 3 to 1.
Thursday, October 30, 2008
fed cut 50 more basis point
The Federal Open Market Committee decided today to lower its target for the federal funds rate 50 basis points to 1 percent.
The pace of economic activity appears to have slowed markedly, owing importantly to a decline in consumer expenditures. Business equipment spending and industrial production have weakened in recent months, and slowing economic activity in many foreign economies is damping the prospects for U.S. exports. Moreover, the intensification of financial market turmoil is likely to exert additional restraint on spending, partly by further reducing the ability of households and businesses to obtain credit.
In light of the declines in the prices of energy and other commodities and the weaker prospects for economic activity, the Committee expects inflation to moderate in coming quarters to levels consistent with price stability.
Recent policy actions, including today's rate reduction, coordinated interest rate cuts by central banks, extraordinary liquidity measures, and official steps to strengthen financial systems, should help over time to improve credit conditions and promote a return to moderate economic growth. Nevertheless, downside risks to growth remain. The Committee will monitor economic and financial developments carefully and will act as needed to promote sustainable economic growth and price stability.
Voting for the FOMC monetary policy action were: Ben S. Bernanke, Chairman; Timothy F. Geithner, Vice Chairman; Elizabeth A. Duke; Richard W. Fisher; Donald L. Kohn; Randall S. Kroszner; Sandra Pianalto; Charles I. Plosser; Gary H. Stern; and Kevin M. Warsh.
In a related action, the Board of Governors unanimously approved a 50-basis-point decrease in the discount rate to 1-1/4 percent. In taking this action, the Board approved the requests submitted by the Boards of Directors of the Federal Reserve Banks of Boston, New York, Cleveland, and San Francisco.
The pace of economic activity appears to have slowed markedly, owing importantly to a decline in consumer expenditures. Business equipment spending and industrial production have weakened in recent months, and slowing economic activity in many foreign economies is damping the prospects for U.S. exports. Moreover, the intensification of financial market turmoil is likely to exert additional restraint on spending, partly by further reducing the ability of households and businesses to obtain credit.
In light of the declines in the prices of energy and other commodities and the weaker prospects for economic activity, the Committee expects inflation to moderate in coming quarters to levels consistent with price stability.
Recent policy actions, including today's rate reduction, coordinated interest rate cuts by central banks, extraordinary liquidity measures, and official steps to strengthen financial systems, should help over time to improve credit conditions and promote a return to moderate economic growth. Nevertheless, downside risks to growth remain. The Committee will monitor economic and financial developments carefully and will act as needed to promote sustainable economic growth and price stability.
Voting for the FOMC monetary policy action were: Ben S. Bernanke, Chairman; Timothy F. Geithner, Vice Chairman; Elizabeth A. Duke; Richard W. Fisher; Donald L. Kohn; Randall S. Kroszner; Sandra Pianalto; Charles I. Plosser; Gary H. Stern; and Kevin M. Warsh.
In a related action, the Board of Governors unanimously approved a 50-basis-point decrease in the discount rate to 1-1/4 percent. In taking this action, the Board approved the requests submitted by the Boards of Directors of the Federal Reserve Banks of Boston, New York, Cleveland, and San Francisco.
Sugar futures ease on higher supply hopes
Indian sugar futures eased on Wednesday in anticipation of higher supplies as crushing in main producing regions begin next week.
At 3:28 p.m., the November contract on the National Commodity and Derivatives Exchange was down 0.06 percent at 1,735 rupees. The December contract fell 0.34 percent to 1,767 rupees.
Veeresh Hiremath, an analyst with Karvy Comtrade Ltd, said mills in the western state of Maharashtra and northern Uttar Pradesh, the country's top two sugar producers, were expected to reach large-scale crushing by mid-November.
Crushing of cane for the crop year that began on Oct. 1 have already begun in the southern states of Karnataka and Andhra Pradesh, he said.
However, spot prices in Maharashtra rose 0.26 percent to 1,727 rupees.
At 3:28 p.m., the November contract on the National Commodity and Derivatives Exchange was down 0.06 percent at 1,735 rupees. The December contract fell 0.34 percent to 1,767 rupees.
Veeresh Hiremath, an analyst with Karvy Comtrade Ltd, said mills in the western state of Maharashtra and northern Uttar Pradesh, the country's top two sugar producers, were expected to reach large-scale crushing by mid-November.
Crushing of cane for the crop year that began on Oct. 1 have already begun in the southern states of Karnataka and Andhra Pradesh, he said.
However, spot prices in Maharashtra rose 0.26 percent to 1,727 rupees.
Sebi to probe stock market crash
The Securities and Exchange Board of India (Sebi) is conducting an inquiry into the stock market crash on October 24 and October 27. The equity benchmarks BSE Sensex and NSE Nifty fell nearly 20 per cent during these two trading sessions.
According to sources in the regulatory agency, trading pattern last Friday aroused suspicion. "Short sellers on Friday took extra care of not letting the markets fall by 10 per cent before 1 pm, which would have triggered the circuit filter and resulted in closure for an hour. Today also there were similar trends. It could be a coincidence but it needs to be looked into," said a source.
After 1 pm, the circuit filter is triggered only if the markets fall by 15 per cent. Sources said apart from a few participatory note (PN) issuing FIIs, activities of some stock brokers is also being looked into.
Sebi Chairman C B Bhave could not be reached for comments.
On Friday, Sensex fell 1,100 points or 11 per cent and the fall in share prices was intense in the last couple of hours of the trading sessions on extremely thin volumes. Even today, the markets witnessed a roller coaster ride as Sensex staged a sharp recovery of over 800 points from its days low of 7,697 to close at 8,509.
Market players said short sellers are exploiting the cash settled derivative segment of the markets and bear operators are taking advantage of the situation by forming a cartel.
Stock brokers have mainly blamed the overseas lending of stocks by FIIs as the real reason behind the fall. Even while the finance ministry has informed that FIIs have been asked to cover their short positions through borrowed stocks, FIIs have not entirely covered positions.
Market players are seeking that Sebi probe the developments during October. The Sensex and Nifty have declined by over 35 percent since October 1 and the Indian stock markets have been the worst performer globally during the period.
While Sebi is seeking detailed data from stocks exchanges, its Integrated Market Surveillance System (IIMSS) system is capable of detecting fraudulent trading practices, including violations such as synchronisation / wash sales; market domination, marking the open, marking the close, and stock-option manipulation.
The sophisticated alert engines also helps Sebi to detect insider trading ahead of the public release of price sensitive information regardless of its source and also identify potential fraud by misrepresentation, including violations such as making public announcements with the intent of moving the price of an instrument either up or down.
According to sources in the regulatory agency, trading pattern last Friday aroused suspicion. "Short sellers on Friday took extra care of not letting the markets fall by 10 per cent before 1 pm, which would have triggered the circuit filter and resulted in closure for an hour. Today also there were similar trends. It could be a coincidence but it needs to be looked into," said a source.
After 1 pm, the circuit filter is triggered only if the markets fall by 15 per cent. Sources said apart from a few participatory note (PN) issuing FIIs, activities of some stock brokers is also being looked into.
Sebi Chairman C B Bhave could not be reached for comments.
On Friday, Sensex fell 1,100 points or 11 per cent and the fall in share prices was intense in the last couple of hours of the trading sessions on extremely thin volumes. Even today, the markets witnessed a roller coaster ride as Sensex staged a sharp recovery of over 800 points from its days low of 7,697 to close at 8,509.
Market players said short sellers are exploiting the cash settled derivative segment of the markets and bear operators are taking advantage of the situation by forming a cartel.
Stock brokers have mainly blamed the overseas lending of stocks by FIIs as the real reason behind the fall. Even while the finance ministry has informed that FIIs have been asked to cover their short positions through borrowed stocks, FIIs have not entirely covered positions.
Market players are seeking that Sebi probe the developments during October. The Sensex and Nifty have declined by over 35 percent since October 1 and the Indian stock markets have been the worst performer globally during the period.
While Sebi is seeking detailed data from stocks exchanges, its Integrated Market Surveillance System (IIMSS) system is capable of detecting fraudulent trading practices, including violations such as synchronisation / wash sales; market domination, marking the open, marking the close, and stock-option manipulation.
The sophisticated alert engines also helps Sebi to detect insider trading ahead of the public release of price sensitive information regardless of its source and also identify potential fraud by misrepresentation, including violations such as making public announcements with the intent of moving the price of an instrument either up or down.
IOC, BPCL, HPCL to get oil bonds worth Rs 65,942 cr
Indian Oil, Bharat Petroleum and Hindustan Petroleum are likely to get oil bonds worth Rs 65,942 crore this week to make up for half of their revenue loss on fuel sale during the first nine months of 2008.
"Parliament has already approved (issue of oil bonds)....We expect Finance Ministry to intimate of the bonds anytime now," said Petroleum Ministry Additional Secretary S Sundareshan said in New Delhi.
BPCL is to announce on Thursday its earnings in July-September quarter, while HPCL and IOC are to do so on Friday. Without the oil bonds, the three would post huge losses.
"Even with oil bonds, things are not going to be any better," he said.
The three firms would get Rs 14,956.17 crore worth of oil bonds for selling petrol, diesel, domestic LPG and kerosene below cost in January-March quarter. They will get an additional Rs 24,408 crore compensation for April-June quarter and the remaining will be for July-September quarter.
Government compensates half of the losses resulting from its dictate to oil companies to not to raise fuel prices in line with cost, through issue of oil bonds.
For 2007-08, the oil companies reported a total revenue loss of Rs 70,579 crore of which Rs 35,289.50 crore is to be compensated through oil bonds. The government has already issued, oil bonds worth Rs 20,333.33 crore for April-December 2007 period.
IOC, BPCL and HPCL in April-September lost Rs 92,853 crore on fuel sales (audited figures) and are projected to lose Rs 1,47,486 crore in the full fiscal. Half of the projected revenue loss is to be compensated through oil bonds.
"Parliament has already approved (issue of oil bonds)....We expect Finance Ministry to intimate of the bonds anytime now," said Petroleum Ministry Additional Secretary S Sundareshan said in New Delhi.
BPCL is to announce on Thursday its earnings in July-September quarter, while HPCL and IOC are to do so on Friday. Without the oil bonds, the three would post huge losses.
"Even with oil bonds, things are not going to be any better," he said.
The three firms would get Rs 14,956.17 crore worth of oil bonds for selling petrol, diesel, domestic LPG and kerosene below cost in January-March quarter. They will get an additional Rs 24,408 crore compensation for April-June quarter and the remaining will be for July-September quarter.
Government compensates half of the losses resulting from its dictate to oil companies to not to raise fuel prices in line with cost, through issue of oil bonds.
For 2007-08, the oil companies reported a total revenue loss of Rs 70,579 crore of which Rs 35,289.50 crore is to be compensated through oil bonds. The government has already issued, oil bonds worth Rs 20,333.33 crore for April-December 2007 period.
IOC, BPCL and HPCL in April-September lost Rs 92,853 crore on fuel sales (audited figures) and are projected to lose Rs 1,47,486 crore in the full fiscal. Half of the projected revenue loss is to be compensated through oil bonds.
R-Infra project hits green hurdles
Reliance [Get Quote] Infrastructure's 4,000-MW power project at Shahpur in Raigad district is facing legal hurdles on environmental ground after the Appellate Tribunal For Environment sought additional information from Ministry of environment and Forest, sources said.
The R-Infra project was initially delayed due to allotment of overlapping land by the state government's two different agencies to the company and also to Tata Power Company [Get Quote].
R-Infra plans to set up two plants at Shahpur. One of the plants will have a 2800 MW capacity and with gas as fuel and a second plant of 1200 MW capacity will coal.
Recently, on the hearing of a petition filed by the project affected villages, the tribunal asked the ministry of forest to submit its reply to the arguments against the project.
The action committee of the villagers is seeking cancellation of the permission because the land was within the purview of Green Zone II, where no industrial activity is allowed. The Maharashtra Pollution Control Board, which recommended granting of environmental clearance to R-Infra project, did not forward the objections of the villagers.
Refuting claims made by villagers a senior official from R-Infra said, "the state government has already initiated the process to change the status of Green Zone II. Hence, the charge of falsifying the status of land use isn't correct."
Besides legal challenge to the project on environmental grounds, RInfra is also facing legal hurdle in the Bombay high court where action committee has challenged notification for land acquisition.
The R-Infra project was initially delayed due to allotment of overlapping land by the state government's two different agencies to the company and also to Tata Power Company [Get Quote].
R-Infra plans to set up two plants at Shahpur. One of the plants will have a 2800 MW capacity and with gas as fuel and a second plant of 1200 MW capacity will coal.
Recently, on the hearing of a petition filed by the project affected villages, the tribunal asked the ministry of forest to submit its reply to the arguments against the project.
The action committee of the villagers is seeking cancellation of the permission because the land was within the purview of Green Zone II, where no industrial activity is allowed. The Maharashtra Pollution Control Board, which recommended granting of environmental clearance to R-Infra project, did not forward the objections of the villagers.
Refuting claims made by villagers a senior official from R-Infra said, "the state government has already initiated the process to change the status of Green Zone II. Hence, the charge of falsifying the status of land use isn't correct."
Besides legal challenge to the project on environmental grounds, RInfra is also facing legal hurdle in the Bombay high court where action committee has challenged notification for land acquisition.
Wednesday, October 29, 2008
RELIANCE INDUSTRIES LIMITED(FINANCIAL RESULTS – Q2, 2008-09)
Reliance Industries (RIL) came out with a stronger than expected results for thequarter ended September 2008 with topline rising by 40% and bottomline increasingby 7%. The refining margins of the company was lower at USD13.4/barrel forSeptember 2008 quarter compared to USD 13.6/barrel in September 2007 quarterand USD 15.7/barrel in June 2008 quarter. The operating margins fell by 350 bps.Commenting on the results, Mukesh D. Ambani, CMD, Reliance Industries said: "Ithas been an exciting quarter at Reliance Industries. We have started production ofoil from the KG basin and soon will emerge as key hydrocarbons major. AtReliance, we are at the final leg of capital expenditure in our key businesses andwill see cash flows from these investments in the following quarters. Leadingeconomies across the globe are passing through some unprecedented times. Ourbusinesses are gearing to meet these emerging challenges."During the quarter ended September 30, 2008, Reliance chemicals , ReliancePolyolefins, Reliance Energy and Project Development, Reliance Polymers (India),Reliance Universal Enterprises, Reliance Global Energy Services (Singapore),Reliance One Enterprises and Reliance Aromatics and Petrochemicals havebecome subsidiaries of the Company.
STANDALONE QUARTERLY RESULTS
For the quarter ended September 2008, the sales of the company grew 40%to Rs 44787 crore. Operating margins fell by 350 basis points to 14.5%leading to a 12% growth in the operating profits at Rs 6474 crore.The average crude prices of Brent, WTI, and Dubai for three months periodended September 2008 were US$ 117.98/bbl, US$ 116.87/bbl and US$113.47/bbl as against US$ 74.68/bbl, US$ 75.37/bbl and US$ 69.97/bbl for thecorresponding previous quarter.Other income for the quarter declined 10% to Rs 151 crore leading the growthin PBDIT at 11% to Rs 6625 crore. Interest costs jumped 70% to Rs 437 croreand depreciation increased 12% to Rs 1264 crore. The PBT of the companyraised 8% to Rs 4924 crore. Considering a marginal increase in effective taxrate the resultant PAT was 7% higher at Rs 4122 crore
STANDALONE QUARTERLY RESULTS
For the quarter ended September 2008, the sales of the company grew 40%to Rs 44787 crore. Operating margins fell by 350 basis points to 14.5%leading to a 12% growth in the operating profits at Rs 6474 crore.The average crude prices of Brent, WTI, and Dubai for three months periodended September 2008 were US$ 117.98/bbl, US$ 116.87/bbl and US$113.47/bbl as against US$ 74.68/bbl, US$ 75.37/bbl and US$ 69.97/bbl for thecorresponding previous quarter.Other income for the quarter declined 10% to Rs 151 crore leading the growthin PBDIT at 11% to Rs 6625 crore. Interest costs jumped 70% to Rs 437 croreand depreciation increased 12% to Rs 1264 crore. The PBT of the companyraised 8% to Rs 4924 crore. Considering a marginal increase in effective taxrate the resultant PAT was 7% higher at Rs 4122 crore
BAJAJ AUTO LIMITED (FINANCIAL RESULTS – Q2, 2008-09)
BAL is the second largest 2-wheeler player in India. The new BAL represents themanufacturing business of the erstwhile BAL post the demerger under a Scheme ofArrangement. The strategic business undertaking consisting of wind farm andfinancial services business has been vested with Bajaj Finserv Limited (BFS) whileall the businesses and all properties, assets, investments and liabilities of erstwhileBAL, other than the manufacturing undertaking, the strategic business undertakingand part of the investments transferred to BAL and BFS, remain vested with TheBajaj Holdings & Investment Limited [(BHIL) – erstwhile Bajaj Auto Limited (BAL).The said scheme became effective with effect from 20 February 2008 (the effectivedate), but operative with retrospective effect from 1 April 2007 (the appointed date).Pursuant to the Scheme, shares were allotted to the shareholders of erstwhile BALon 3 April 2008 and the new shares got listed in BSE and NSE on 26 May 2008
PERFORMANCE
In the quarter ended Sept ’08, the company’s total operating income grew by8% to Rs 2548.43 crore owing to its net sales. Its net sales grew by 9% to Rs2450.73 crore driven by low sales volume growth. Out of this, its exportssurged by robust 44% to Rs 744 crore. Its other operating income declined by17% to Rs 97.70 crore.Its total sales volume grew by meager 4% to 640042 units on back of flat 3wheeler sales volume and marginal improvement in 2 wheeler sales volume.Its 2 wheeler sales volume, that contributes close to 88% to total salesvolume, grew by 5% to 565098 units. Out of this, its motorcycle sales volumethat represents 99% of 2 wheeler sales volume, increased by 6% to 561477units. Its 3 wheeler sales volume were flat at 74944 units, up by only 63 units.Its total exports grew by 31% to 206930 units. Its contribution to the total salesvolume has drastically increased by 600 bps to 32%.Its operating profit margin (OPM) declined notably by 270 bps to 13.5% owingto increase in raw material cost and purchase of traded goods. Thus itsoperating profit reduced by 10% to Rs 343.86 crore. Its raw material cost, as% to sales net stock adjusted, rose by 240 bps to 72%. Also its purchase oftraded goods rose by 60 bps to 4%. Its other expenditure rose by 20 bps to9%. Its staff cost declined by 20 bps to 3%
On the non operating front, its other income slipped by 15% to Rs 22.10 crore.Further its interest cost increased by whopping 332% to Rs 5.87 crore.However decline in its depreciation cost by 33% to Rs 33.08 crore partiallyarrested the degrowth in the profit levels. Its PBT before EO reduced by 9% toRs 327.01 crore. It registered EO expense of Rs 61.10 crore representingVRS compensation for the workers at Akrudi plant in quarter ended Sept ’08against nil in quarter ended Sept ’07. In the current fiscal, the company hasdecided to recognize expenditure such as VRS over an appropriate period incompliance with provisions of AS – 15 Employee benefits in line with specialtransition provision option (which allows such expenses to be deferred forrecognition over payback period but not exceeding 1st Apr 10). Thus it pulleddown the PBT after EO notably by 26% to Rs 265.91 crore. Its tax provisionslipped by 32% to Rs 81 crore owing to both low profit base and decline ineffective tax rate by 300 bps to 30%. Its net profit declined by 23% to Rs184.91 crore.
PERFORMANCE
In the quarter ended Sept ’08, the company’s total operating income grew by8% to Rs 2548.43 crore owing to its net sales. Its net sales grew by 9% to Rs2450.73 crore driven by low sales volume growth. Out of this, its exportssurged by robust 44% to Rs 744 crore. Its other operating income declined by17% to Rs 97.70 crore.Its total sales volume grew by meager 4% to 640042 units on back of flat 3wheeler sales volume and marginal improvement in 2 wheeler sales volume.Its 2 wheeler sales volume, that contributes close to 88% to total salesvolume, grew by 5% to 565098 units. Out of this, its motorcycle sales volumethat represents 99% of 2 wheeler sales volume, increased by 6% to 561477units. Its 3 wheeler sales volume were flat at 74944 units, up by only 63 units.Its total exports grew by 31% to 206930 units. Its contribution to the total salesvolume has drastically increased by 600 bps to 32%.Its operating profit margin (OPM) declined notably by 270 bps to 13.5% owingto increase in raw material cost and purchase of traded goods. Thus itsoperating profit reduced by 10% to Rs 343.86 crore. Its raw material cost, as% to sales net stock adjusted, rose by 240 bps to 72%. Also its purchase oftraded goods rose by 60 bps to 4%. Its other expenditure rose by 20 bps to9%. Its staff cost declined by 20 bps to 3%
On the non operating front, its other income slipped by 15% to Rs 22.10 crore.Further its interest cost increased by whopping 332% to Rs 5.87 crore.However decline in its depreciation cost by 33% to Rs 33.08 crore partiallyarrested the degrowth in the profit levels. Its PBT before EO reduced by 9% toRs 327.01 crore. It registered EO expense of Rs 61.10 crore representingVRS compensation for the workers at Akrudi plant in quarter ended Sept ’08against nil in quarter ended Sept ’07. In the current fiscal, the company hasdecided to recognize expenditure such as VRS over an appropriate period incompliance with provisions of AS – 15 Employee benefits in line with specialtransition provision option (which allows such expenses to be deferred forrecognition over payback period but not exceeding 1st Apr 10). Thus it pulleddown the PBT after EO notably by 26% to Rs 265.91 crore. Its tax provisionslipped by 32% to Rs 81 crore owing to both low profit base and decline ineffective tax rate by 300 bps to 30%. Its net profit declined by 23% to Rs184.91 crore.
Unitech Wireless To Sell 60% Stake For Rs 6,210 Cr To Telenor
The valuation of Unitech Wireless is Rs 11,620 Cr, higher than Swan Telecom's $2 billion valuation.
Unitech Ltd, one of India's largest real estate companies, has sold a 60% stake for Rs 6,210 crore in its telecom arm to Norway's Telenor. Unitech Wireless has licences to operate in all 22 telecom circles and has also received spectrum for six circles. The valuation of Unitech Wireless is higher than Swan Telecom, which last month sold a 45% stake at a valuation of $2 billion (Rs 9,000 crore). But Swan, which is promoted by Mumbai-based real estate and hospitality business group Dynamix Balwas (DB) Group, has licences only in 13 circles. Valuation of Unitech Wireless is Rs 11,620 crore.
Unitech has sold out a majority stake in its telecom arm, making Unitech Wireless one of the few telecom companies controlled by foriegn telcos. While Vodafone acquired Hutch in 2006, Aircel is controlled by Malaysian telco Maxis. The FDI limit in telcos is 74%.
There were several other in the race for a stake in Unitech Wireless, including Europe's Telecom Italia. Unitech has hired about 250 people for its telecom venture and plans to roll out services by April next year. The company plans to invest $3 billion in its telecom venture for next three years. It recently raised Rs 1,200 crore for its telecom venture from a syndicate of public sector banks led by Punjab National Bank and Canara Bank.
Telenor is majority owned by the government of Norway, which holds a 54% stake. Interestingly, earlier this month Government Pension Fund of Norway has decided to pump in close to $2 billion over the next two months in Indian equity and bond market. Telenor also operates in Pakistan and Bangladesh.
Unitech was advised by UBS (financial advisor) and Amarchand & Mangaldas & Suresh A. Shroff & Co (legal advisor) on the deal.
Unitech Ltd, one of India's largest real estate companies, has sold a 60% stake for Rs 6,210 crore in its telecom arm to Norway's Telenor. Unitech Wireless has licences to operate in all 22 telecom circles and has also received spectrum for six circles. The valuation of Unitech Wireless is higher than Swan Telecom, which last month sold a 45% stake at a valuation of $2 billion (Rs 9,000 crore). But Swan, which is promoted by Mumbai-based real estate and hospitality business group Dynamix Balwas (DB) Group, has licences only in 13 circles. Valuation of Unitech Wireless is Rs 11,620 crore.
Unitech has sold out a majority stake in its telecom arm, making Unitech Wireless one of the few telecom companies controlled by foriegn telcos. While Vodafone acquired Hutch in 2006, Aircel is controlled by Malaysian telco Maxis. The FDI limit in telcos is 74%.
There were several other in the race for a stake in Unitech Wireless, including Europe's Telecom Italia. Unitech has hired about 250 people for its telecom venture and plans to roll out services by April next year. The company plans to invest $3 billion in its telecom venture for next three years. It recently raised Rs 1,200 crore for its telecom venture from a syndicate of public sector banks led by Punjab National Bank and Canara Bank.
Telenor is majority owned by the government of Norway, which holds a 54% stake. Interestingly, earlier this month Government Pension Fund of Norway has decided to pump in close to $2 billion over the next two months in Indian equity and bond market. Telenor also operates in Pakistan and Bangladesh.
Unitech was advised by UBS (financial advisor) and Amarchand & Mangaldas & Suresh A. Shroff & Co (legal advisor) on the deal.
STERLITE INDUSTRIES (INDIA) LTD.(Result Update: Q2, 2008-09)
Highlights of Q2 performance
On consolidated basis for the quarter ended September 2008, the revenue of SterliteIndustries increased by 3% to Rs 6810.99 crore (including other operative income ofRs 217.22 crore). The OPM of the company declined by 320 bps to 27.2% on the backof sharp decline in LME prices of all the metals on one side and significant increase inpower and fuel cost on other. The overall operating profit declined by 8% to Rs1852.24 crore.The other income for the quarter surged by 42% on Y-o-Y to 402.46 crore leading to aPBIDT of Rs 2247 crore, down 2% on Y-o-Y.The interest charges for the quarter were at Rs 58.05 crore (down 10% Y-o-Y) and thedepreciation charges for the quarter declined by 19% Y-o-Y to Rs 166.65 crore. Foruniform accounting policy depreciation on new plant and machinery in aluminiumbusiness has been provided at SLM rates as against the WDV Method rates.Consequent to this, depreciation charge for the quarter ended September 2008 islower by Rs 44.33 crore. The decline in interest and depreciation charges boost thePBT before EO to Rs 2022.37 crore, flat on Y-o-Y basis.After considering the EO expenses of Rs 10 crore in Q2 FY09 relating to any possibleliability on account of guarantees given to Banks and Financial Institutions for theloans taken by other company, (against NIL in Q2 FY08), the PBT after EO stood atRs 2012.37 crore, almost flat on Y-o-Y. The provision for taxation was Rs 291.56 crore
On consolidated basis for the quarter ended September 2008, the revenue of SterliteIndustries increased by 3% to Rs 6810.99 crore (including other operative income ofRs 217.22 crore). The OPM of the company declined by 320 bps to 27.2% on the backof sharp decline in LME prices of all the metals on one side and significant increase inpower and fuel cost on other. The overall operating profit declined by 8% to Rs1852.24 crore.The other income for the quarter surged by 42% on Y-o-Y to 402.46 crore leading to aPBIDT of Rs 2247 crore, down 2% on Y-o-Y.The interest charges for the quarter were at Rs 58.05 crore (down 10% Y-o-Y) and thedepreciation charges for the quarter declined by 19% Y-o-Y to Rs 166.65 crore. Foruniform accounting policy depreciation on new plant and machinery in aluminiumbusiness has been provided at SLM rates as against the WDV Method rates.Consequent to this, depreciation charge for the quarter ended September 2008 islower by Rs 44.33 crore. The decline in interest and depreciation charges boost thePBT before EO to Rs 2022.37 crore, flat on Y-o-Y basis.After considering the EO expenses of Rs 10 crore in Q2 FY09 relating to any possibleliability on account of guarantees given to Banks and Financial Institutions for theloans taken by other company, (against NIL in Q2 FY08), the PBT after EO stood atRs 2012.37 crore, almost flat on Y-o-Y. The provision for taxation was Rs 291.56 crore
US STOCKS-Market opens lower
U.S. stocks fell at the open on Wednesday as investors locked in profits after Tuesday's steep gains and retailers' shares fell as oil prices rose, eclipsing optimism about a possible interest-rate cut.
The Dow Jones industrial average .DJI fell 53.29 points, or 0.59 percent, to 9,011.83, while the Standard & Poor's 500 Index .SPX slid 6.21 points, or 0.66 percent, to 934.30. The Nasdaq Composite Index .IXIC was down 11.56 points, or 0.70 percent, at 1,637.91
The Dow Jones industrial average .DJI fell 53.29 points, or 0.59 percent, to 9,011.83, while the Standard & Poor's 500 Index .SPX slid 6.21 points, or 0.66 percent, to 934.30. The Nasdaq Composite Index .IXIC was down 11.56 points, or 0.70 percent, at 1,637.91
MARUTI SUZUKI INDIA LIMITED (FINANCIAL RESULTS – Q2, 2008-09)
In the quarter ended Sept ’08, Maruti Suzuki India (MSI), recorded moderate growthin its total operating income by 7% to Rs 4993.62 crore. However crash in its OPMby 480 bps lowered the operating profit by 27% to Rs 515.71 crore. The fall in itsOPM is attributed to couple of factors such as Yen appreciation, increase in royalty,increase in diesel cost, rise in employee cost due to K series plant, expandedcapacity at Manesar and R&D etc. Further, its depreciation cost surged by 88%owing to new depreciation policy which in turn worsened the profit levels. Its netprofit declined by 37% to Rs 296.12 crore.
Quarter Performance
The company’s net sales grew marginally by 6% to Rs 4806.26 crore inquarter ended Sept ’08 owing to degrowth in its sales volume. Its total salesvolume reduced by 1% to 189451 units driven by its domestic sales. Itsdomestic sales declined by 3% to 171706 units. However improvement in itsexports by 17% to 17745 units partially arrested the degrowth in its total salesvolume. Its total operating income grew by 7% to Rs 4993.62 crore.Its operating profit margin (OPM) crashed by 480 bps to 10.3% lowering itsoperating profit by 27% to Rs 515.71 crore.Its other income grew by 22% to Rs 96.04 crore. Its interest cost rose by 48%to Rs 20.77 crore. Its depreciation recorded steep hike of 88% to Rs 165.84crore owing to new depreciation policy adopted this fiscal that lowered theuseful life of assets. It’s PBT after EO declined by 38% to Rs 425.14 crore. Onaccounting its tax provision, its net profit declined by 37% to Rs 296.12 crore
Quarter Performance
The company’s net sales grew marginally by 6% to Rs 4806.26 crore inquarter ended Sept ’08 owing to degrowth in its sales volume. Its total salesvolume reduced by 1% to 189451 units driven by its domestic sales. Itsdomestic sales declined by 3% to 171706 units. However improvement in itsexports by 17% to 17745 units partially arrested the degrowth in its total salesvolume. Its total operating income grew by 7% to Rs 4993.62 crore.Its operating profit margin (OPM) crashed by 480 bps to 10.3% lowering itsoperating profit by 27% to Rs 515.71 crore.Its other income grew by 22% to Rs 96.04 crore. Its interest cost rose by 48%to Rs 20.77 crore. Its depreciation recorded steep hike of 88% to Rs 165.84crore owing to new depreciation policy adopted this fiscal that lowered theuseful life of assets. It’s PBT after EO declined by 38% to Rs 425.14 crore. Onaccounting its tax provision, its net profit declined by 37% to Rs 296.12 crore
CIPLA LTD.(Result Update: Q2, 2008-09)
Highlights of Q2 performance
For the quarter ended September’08, the net sales registered a moderate growth of23% to Rs 1354.69 crore on the back of 48% rise in the exports formulationbusiness to Rs 602.35 crore.. Operating profit margins narrowed by 660 bps to15.6% on the back of forex exchange losses of Rs 104.50 crore (as against forexgain of Rs 19.96 crore) and led operating profit fall of Rs 14% to Rs 211.01 crore.Resultantly, operating profit fell by 14% to Rs 211.01 crore.Other income for the quarter reported a dip of 23% to Rs 16.87 crore. The interestrose by 136% to Rs 5.59 crore and depreciation went up by 24% to Rs 40.61 crore,respectively, the PBT reported a fall of 21% to Rs 181.68 crore. As the effective taxrate fell by 70 bps to 16.7% resulting net profit to decline by 21% to Rs 151.43crore
For the quarter ended September’08, the net sales registered a moderate growth of23% to Rs 1354.69 crore on the back of 48% rise in the exports formulationbusiness to Rs 602.35 crore.. Operating profit margins narrowed by 660 bps to15.6% on the back of forex exchange losses of Rs 104.50 crore (as against forexgain of Rs 19.96 crore) and led operating profit fall of Rs 14% to Rs 211.01 crore.Resultantly, operating profit fell by 14% to Rs 211.01 crore.Other income for the quarter reported a dip of 23% to Rs 16.87 crore. The interestrose by 136% to Rs 5.59 crore and depreciation went up by 24% to Rs 40.61 crore,respectively, the PBT reported a fall of 21% to Rs 181.68 crore. As the effective taxrate fell by 70 bps to 16.7% resulting net profit to decline by 21% to Rs 151.43crore
SUN PHARMACEUTICALS INDUSTRIES LTD (Result Update: Q2, 2008-09)
Highlights of Q2 performance
The Consolidated net sales of the Sun Pharmaceuticals showed strong growth of 76%at Rs 1177.84 crore for the quarter ended September’08. Revenues from the productslaunched at risk, ie, Protonix and Ethyol, powered top line growth.Operating profit margin increased by whopping 1290 bps to 45.7% on back of fall in allexpenditure over heads as percentage to sales, net of stock adjustment. Operatingprofit spurted by 145% to Rs 537.96 crore.Other income increased by whopping 377% to Rs 23.47 crore, which boosted thePBIDT to 150% at Rs 561.43 crore.The interest income rose marginally by 12% to Rs 31.04 crore. The depreciationincreased moderately by 25% over corresponding previous period to Rs 28.65 crore,improved PBT to report growth of 146% at Rs 563.82 crore. The rise of 510 bps ineffective tax rate to 5.10% resulted PAT to increase by 134% to Rs 535.07 crore.After accounting for minority interest of Rs 22.30 crore compared to Rs 10.39 crore inthe corresponding previous period, the net profit grew by whopping 135% to Rs 512.77crore
Other Developments
Domestic sales grew in line with industry domestic sales (22%); and contributed 40% of totalsales.International sales zoomed by 141% over Q2 FY08; contributed 60% of total sales.In the quarter ended September’08, formulation business reported massive growth of 79%to Rs 1071.76 crore on back of 174% increase in the exports to Rs 624.46 crore. Domesticformulation revenues grew by 20% to Rs 447.30 crore.Bulk drugs revenue improved by 44% to Rs 134.92 crore for the quarter under review.Domestic bulk drugs revenues went up by 62% to Rs 34.11 crore and International bulkdrugs revenues improved by 39% to Rs 100.81 crore.Sun Pharma has filed 7 ANDAs and Caraco filed 3 ANDA in the quarter, taking the totalnumber pending approval to 96 filings.Consolidated R & D expenses for the quarter stood at 88.39 crore, or 7.5% of net sales.In the quarter, 3 products have been approved by the USFDA
Outlook
Company had strong performance across all its business segments. The generic business in theUS, the branded prescription businesses in India and international markets continue to poststeady growth. This performance validates belief in the potential for these markets and theinvestments co. have made in setting up, nurturing and expanding these businesses
The Consolidated net sales of the Sun Pharmaceuticals showed strong growth of 76%at Rs 1177.84 crore for the quarter ended September’08. Revenues from the productslaunched at risk, ie, Protonix and Ethyol, powered top line growth.Operating profit margin increased by whopping 1290 bps to 45.7% on back of fall in allexpenditure over heads as percentage to sales, net of stock adjustment. Operatingprofit spurted by 145% to Rs 537.96 crore.Other income increased by whopping 377% to Rs 23.47 crore, which boosted thePBIDT to 150% at Rs 561.43 crore.The interest income rose marginally by 12% to Rs 31.04 crore. The depreciationincreased moderately by 25% over corresponding previous period to Rs 28.65 crore,improved PBT to report growth of 146% at Rs 563.82 crore. The rise of 510 bps ineffective tax rate to 5.10% resulted PAT to increase by 134% to Rs 535.07 crore.After accounting for minority interest of Rs 22.30 crore compared to Rs 10.39 crore inthe corresponding previous period, the net profit grew by whopping 135% to Rs 512.77crore
Other Developments
Domestic sales grew in line with industry domestic sales (22%); and contributed 40% of totalsales.International sales zoomed by 141% over Q2 FY08; contributed 60% of total sales.In the quarter ended September’08, formulation business reported massive growth of 79%to Rs 1071.76 crore on back of 174% increase in the exports to Rs 624.46 crore. Domesticformulation revenues grew by 20% to Rs 447.30 crore.Bulk drugs revenue improved by 44% to Rs 134.92 crore for the quarter under review.Domestic bulk drugs revenues went up by 62% to Rs 34.11 crore and International bulkdrugs revenues improved by 39% to Rs 100.81 crore.Sun Pharma has filed 7 ANDAs and Caraco filed 3 ANDA in the quarter, taking the totalnumber pending approval to 96 filings.Consolidated R & D expenses for the quarter stood at 88.39 crore, or 7.5% of net sales.In the quarter, 3 products have been approved by the USFDA
Outlook
Company had strong performance across all its business segments. The generic business in theUS, the branded prescription businesses in India and international markets continue to poststeady growth. This performance validates belief in the potential for these markets and theinvestments co. have made in setting up, nurturing and expanding these businesses
US STOCKS-Profit-taking likely to lead to flat open
* Investors pause after Tuesday's surge, before Fed
* Federal Reserve expected to cut interest rates
* Signs of thawing credit markets offer positive spur
* Energy stocks up on higher oil price; airlines drop (Recasts first paragraph, adds details, update prices)
By Ellis Mnyandu
NEW YORK, Oct 29 (Reuters) - U.S. stocks headed for flat open on Wednesday as profit-taking and concerns about rising oil prices offset optimism about a possible interest-rate cut and signs of a thaw in credit markets.
A day after after Wall Street roared to its second-best advance ever, investors paused to gauge if the market would continue to bounce back from its lowest levels in more than five years.
Tuesday's surge on Wall Street helped fuel an advance in other stock markets, with Asia up sharply overnight, and European benchmark indexes up about 5 percent on Wednesday.
There remain worries about the severity of a global recession, said Andre Bakhos, president of Princeton Financial Group in Princeton, New Jersey. In addition, higher oil prices looked set also to give investors pause, with U.S. crude up 6 percent at $66.53 a barrel
"We are going to see some profit taking and people will wait for the Fed news. Yesterday's move was driven by expectations that the Fed will do something," he said.
"At the same time, yesterday's rally may make some people to pause and ask if this isn't the time to actually get out. That mind-set is still out there."
S&P 500 futures SPc1 edged up 0.3 point and were about even with fair value, a formula that evaluates pricing by taking into account interest rates, dividends and time to expiration on the contract.
Dow Jones industrial average futures DJc1 fell 29 points, and Nasdaq 100 NDc1 futures shed 6.75 points.
The Federal Reserve is widely expected to cut its benchmark fed funds rate by at least 50 basis points from the current 1.5 percent. Its decision is expected around 2:15 p.m. (1815 GMT).
"What the Fed says on the economic outlook, I think is what's going to dictate the market's next move," added Bakhos.
Energy shares, including Exxon Mobil Corp (XOM.N: Quote, Profile, Research) , were expected to rise with oil prices. But higher energy costs also were likely to create headwinds for retailers and airlines, with Delta shares (DAL.N: Quote, Profile, Research) off 3.3 percent at $7.89 before the bell.
U.S. stock futures had briefly added to gains before the open on a government report that showed a surprise increase in new orders for long-lasting manufactured goods in September.
* Federal Reserve expected to cut interest rates
* Signs of thawing credit markets offer positive spur
* Energy stocks up on higher oil price; airlines drop (Recasts first paragraph, adds details, update prices)
By Ellis Mnyandu
NEW YORK, Oct 29 (Reuters) - U.S. stocks headed for flat open on Wednesday as profit-taking and concerns about rising oil prices offset optimism about a possible interest-rate cut and signs of a thaw in credit markets.
A day after after Wall Street roared to its second-best advance ever, investors paused to gauge if the market would continue to bounce back from its lowest levels in more than five years.
Tuesday's surge on Wall Street helped fuel an advance in other stock markets, with Asia up sharply overnight, and European benchmark indexes up about 5 percent on Wednesday.
There remain worries about the severity of a global recession, said Andre Bakhos, president of Princeton Financial Group in Princeton, New Jersey. In addition, higher oil prices looked set also to give investors pause, with U.S. crude up 6 percent at $66.53 a barrel
"We are going to see some profit taking and people will wait for the Fed news. Yesterday's move was driven by expectations that the Fed will do something," he said.
"At the same time, yesterday's rally may make some people to pause and ask if this isn't the time to actually get out. That mind-set is still out there."
S&P 500 futures SPc1 edged up 0.3 point and were about even with fair value, a formula that evaluates pricing by taking into account interest rates, dividends and time to expiration on the contract.
Dow Jones industrial average futures DJc1 fell 29 points, and Nasdaq 100 NDc1 futures shed 6.75 points.
The Federal Reserve is widely expected to cut its benchmark fed funds rate by at least 50 basis points from the current 1.5 percent. Its decision is expected around 2:15 p.m. (1815 GMT).
"What the Fed says on the economic outlook, I think is what's going to dictate the market's next move," added Bakhos.
Energy shares, including Exxon Mobil Corp (XOM.N: Quote, Profile, Research) , were expected to rise with oil prices. But higher energy costs also were likely to create headwinds for retailers and airlines, with Delta shares (DAL.N: Quote, Profile, Research) off 3.3 percent at $7.89 before the bell.
U.S. stock futures had briefly added to gains before the open on a government report that showed a surprise increase in new orders for long-lasting manufactured goods in September.
Tata Power Ltd (Q2 FY09)
* Revenue growth of 45% yoy backed by sharp rise in realizations
* OPM down 580 bps yoy due to steep rise in fuel costs
* Net profit growth of 1.7% yoy not comparable due to change in accounting
policy
* Growth plans intact with funding and fuel tie-ups in place for most projects
under implementation
Revenue growth of 45% yoy backed by sharp rise in realizations
Revenues grew 45% yoy on the back of 64% yoy rise in average realizations per
unit sold (from Rs3.5 to Rs5.8); despite 11% yoy de-growth in units sold (from 3.8
BUs to 3.4 BUs). The sharp rise in realizations was due to escalation in fuel prices,
which are a pass through for Tata Power (TPWR). Sales volumes declined due to
6% yoy decline in units generated (mainly in hydro power plants). Also, up to
Q1FY09, TPWR used to purchase extra power from outside and supply to
distribution entities in the Mumbai License Area (LA) (pure pass through). This is
now being done by another licensee. To that extent, the sales volumes for the
quarter have declined as compared to Q2FY08. Revenues from Mumbai LA
comprised 85% of total revenues in Q2FY09 as against 87% in Q2FY08.
OPM down 580 bps yoy due to steep rise in fuel costs
Contraction in OPM by 580 bps was due to 1,230 bps yoy sharp rise in cost of fuel with prices of coal, gas and oil
reaching their all-time highs in July 2008. However, further erosion in margins was restricted by an aggregate 650 bps
yoy decline in cost of power purchased, staff cost and other costs.
Net profit growth of 1.7% yoy not comparable due to change in accounting policy
Profit before tax was higher by 6.6% yoy on account of 34% yoy rise in other income, despite higher depreciation and
interest expenses. Other income comprised forex gains, dividends received and profit on sale of long term investments.
The effective tax rate for the quarter was higher at 15.2% as against 11.1% in Q2FY08. As a result, net profit was
higher by only 1.7% yoy. However, the PAT is not comparable due to change in accounting policy. Regulatory
adjustments, which used to be made on an annual basis in the last quarter of the year, are made on a provisional basis
every quarter from Q1FY09 onwards.
Business update
* Progress in implementation of generation projects: Management is confident that the company’s growth plans
will not be majorly impacted by the ongoing global financial turmoil. This confidence stems from the fact that funding
and fuel tie-ups are in place for most projects under implementation and construction work is progressing as per
schedule.
o During the quarter, the first unit of the 120 MW Haldia power project was commissioned, synchronization of the
second unit with the grid was completed and the third unit is expected to be commissioned by end FY09.
o The 4,000 MW Mundra ultra mega power project (UMPP) is progressing as per schedule and the first unit will be
commissioned by September 2011.
o For the 1,050 MW Maithon power project (JV with Damodar Valley Corporation), most equipment orders are in
place and overall progress is 20%, in line with the schedule.
o The synchronization of the 250 MW Trombay Unit 8 is scheduled for November 2008.
o The 50 MW wind project at Khandke will be commissioned in Q3FY09. TPWR is developing two more wind projects
of 50.4 MW each in Gujarat and Karnataka.
o The 120 MW each Jamshedpur and Jojobera captive projects for Tata Steel are progressing as per schedule.
* Hydro power initiative in Bhutan: During the quarter, TPWR entered a partnership with the Royal government of
Bhutan to develop 114 MW hydro power and acquired 26% stake in the project. Tata Power Trading will off-take all
the power from the project for a period of 25 years.
* Foray into geothermal energy: The company has widened its presence in the renewable energy space by
investing Rs1.65bn in Geodynamics Ltd, Australia. Post acquisition, TPWR holds 10% stake in the company.
* OPM down 580 bps yoy due to steep rise in fuel costs
* Net profit growth of 1.7% yoy not comparable due to change in accounting
policy
* Growth plans intact with funding and fuel tie-ups in place for most projects
under implementation
Revenue growth of 45% yoy backed by sharp rise in realizations
Revenues grew 45% yoy on the back of 64% yoy rise in average realizations per
unit sold (from Rs3.5 to Rs5.8); despite 11% yoy de-growth in units sold (from 3.8
BUs to 3.4 BUs). The sharp rise in realizations was due to escalation in fuel prices,
which are a pass through for Tata Power (TPWR). Sales volumes declined due to
6% yoy decline in units generated (mainly in hydro power plants). Also, up to
Q1FY09, TPWR used to purchase extra power from outside and supply to
distribution entities in the Mumbai License Area (LA) (pure pass through). This is
now being done by another licensee. To that extent, the sales volumes for the
quarter have declined as compared to Q2FY08. Revenues from Mumbai LA
comprised 85% of total revenues in Q2FY09 as against 87% in Q2FY08.
OPM down 580 bps yoy due to steep rise in fuel costs
Contraction in OPM by 580 bps was due to 1,230 bps yoy sharp rise in cost of fuel with prices of coal, gas and oil
reaching their all-time highs in July 2008. However, further erosion in margins was restricted by an aggregate 650 bps
yoy decline in cost of power purchased, staff cost and other costs.
Net profit growth of 1.7% yoy not comparable due to change in accounting policy
Profit before tax was higher by 6.6% yoy on account of 34% yoy rise in other income, despite higher depreciation and
interest expenses. Other income comprised forex gains, dividends received and profit on sale of long term investments.
The effective tax rate for the quarter was higher at 15.2% as against 11.1% in Q2FY08. As a result, net profit was
higher by only 1.7% yoy. However, the PAT is not comparable due to change in accounting policy. Regulatory
adjustments, which used to be made on an annual basis in the last quarter of the year, are made on a provisional basis
every quarter from Q1FY09 onwards.
Business update
* Progress in implementation of generation projects: Management is confident that the company’s growth plans
will not be majorly impacted by the ongoing global financial turmoil. This confidence stems from the fact that funding
and fuel tie-ups are in place for most projects under implementation and construction work is progressing as per
schedule.
o During the quarter, the first unit of the 120 MW Haldia power project was commissioned, synchronization of the
second unit with the grid was completed and the third unit is expected to be commissioned by end FY09.
o The 4,000 MW Mundra ultra mega power project (UMPP) is progressing as per schedule and the first unit will be
commissioned by September 2011.
o For the 1,050 MW Maithon power project (JV with Damodar Valley Corporation), most equipment orders are in
place and overall progress is 20%, in line with the schedule.
o The synchronization of the 250 MW Trombay Unit 8 is scheduled for November 2008.
o The 50 MW wind project at Khandke will be commissioned in Q3FY09. TPWR is developing two more wind projects
of 50.4 MW each in Gujarat and Karnataka.
o The 120 MW each Jamshedpur and Jojobera captive projects for Tata Steel are progressing as per schedule.
* Hydro power initiative in Bhutan: During the quarter, TPWR entered a partnership with the Royal government of
Bhutan to develop 114 MW hydro power and acquired 26% stake in the project. Tata Power Trading will off-take all
the power from the project for a period of 25 years.
* Foray into geothermal energy: The company has widened its presence in the renewable energy space by
investing Rs1.65bn in Geodynamics Ltd, Australia. Post acquisition, TPWR holds 10% stake in the company.
Godawari Power and Ispat Ltd (Q2 FY09)
Strong realisations continue to bolster topline by 86.1% yoy
Rising raw material costs lead to a 520bps yoy drop in OPM
GPIL plans to sell higher amount of sponge iron than billets in the next two
quarters
Iron ore mining expected to start in Q3 FY09, earlier than expected
The company announces a buyback at a price not exceeding Rs135 per share
Strong realisations bolster revenue
Godawari Power and Ispat Ltd. (GPIL) reported an 86.1% yoy growth in Q1FY09 at
Rs3.3bn on the back of strong realisations. Steel prices remained strong during the
quarter, up by 60-100% yoy on various products. However, on a qoq basis, the
topline remained flat at 3.5% due to lower billet and wire rod sales. The company
increased its sales of captive power following higher returns. Sales of billets and
wire rods were 7-8% lower on a qoq basis. The company, in Q2 FY09, sold ~10MU
of power with an average realisation of Rs6.5 per unit.
Rising raw material costs lead to a 520bps yoy drop in OPM
Operating profit during the quarter rose 39.9% yoy to Rs525mn. OPM during the quarter remained under pressure due
to rising raw material costs. The raw material market remained tight leading to a jump in prices. GPIL has no captive
resources, leading to a jump in raw material prices. Iron ore and coal prices have doubled in the last one year causing a
fall of 520bps in OPM to 15.8% in Q2 FY09. On a qoq basis, OPM fell 180bps as landed costs of iron ore jumped to
Rs5,400 per ton from Rs4,500 per ton in Q1 FY09. Landed cost of coal were Rs3,000 per ton, same as that of last
quarter. Raw material costs as a % of sales rose to 77.3% in Q2 FY09 from 76% in Q1 FY09 and 69.1% in Q2 FY08.
New projects online, to be completed by Q2FY10
The company in Q1 FY09 received the approval from Ministry of Environment & Forest for Mining of Iron Ore in Ari
Dongri Mines in Chhattisgarh. Mining is expected to start from Q3 FY09, earlier than expected. The company also plans
to build an iron ore crushing plant with a capacity of 1.2mtpa, a beneficiation plant with a capacity of 0.1mtpa and a
pelletization plant with a capacity of 0.6mtpa with railway siding and other infrastructure development, at a cost of
Rs2.35bn. Execution of the plan is on schedule and is expected to start production in Q2 FY10. The company has also
decided to set up another iron ore palletisation plant with a capacity of 0.6mtpa in Orissa through a Joint Venture in the
name of Ardent Steel Ltd., in which the company will have a 75% stake.
Company announces a buyback at a price not exceeding Rs135 per share
The company has announced to buy back equity shares at a price not exceeding Rs135 per share. The aggregate
amount to be spent on buy back of the equity shares shall not exceed Rs360mn, which is 9.37 % of the paid-up capital
as on March 31st, 2008. The company will buy back minimum 3,00,000 equity shares
Outlook
GPIL has been proactively taking steps to maximize its return on capital. Due to a slowdown in the demand for the
billets, the company reduced its production and started to sell power. Owing to the global financial crisis, demand for
steel products has reduced drastically. We expect the demand to be higher from the current levels in the next two
months. Steel and steel product prices have fallen more than 30% in the Asian markets. We expect steel realisations to
fall 30% from the current levels in Q3 FY09 and remain constant for the rest of the year. The company’s captive iron ore
mine will aid in decreasing the raw material cost pressure. Despite a fall in steel realisations, the company’s OPM is
expected to expand in FY10.
At CMP of Rs75, the stock trades at P/E multiple of 1.9x and 2.0x on estimated earnings of Rs39.5 in FY09E and Rs37.5
in FY10E, respectively. We recommend a BUY with a target price Rs110 based on an EV/EBIDTA multiple of 2.5x FY10E
EBIDTA of Rs1.86bn.
Rising raw material costs lead to a 520bps yoy drop in OPM
GPIL plans to sell higher amount of sponge iron than billets in the next two
quarters
Iron ore mining expected to start in Q3 FY09, earlier than expected
The company announces a buyback at a price not exceeding Rs135 per share
Strong realisations bolster revenue
Godawari Power and Ispat Ltd. (GPIL) reported an 86.1% yoy growth in Q1FY09 at
Rs3.3bn on the back of strong realisations. Steel prices remained strong during the
quarter, up by 60-100% yoy on various products. However, on a qoq basis, the
topline remained flat at 3.5% due to lower billet and wire rod sales. The company
increased its sales of captive power following higher returns. Sales of billets and
wire rods were 7-8% lower on a qoq basis. The company, in Q2 FY09, sold ~10MU
of power with an average realisation of Rs6.5 per unit.
Rising raw material costs lead to a 520bps yoy drop in OPM
Operating profit during the quarter rose 39.9% yoy to Rs525mn. OPM during the quarter remained under pressure due
to rising raw material costs. The raw material market remained tight leading to a jump in prices. GPIL has no captive
resources, leading to a jump in raw material prices. Iron ore and coal prices have doubled in the last one year causing a
fall of 520bps in OPM to 15.8% in Q2 FY09. On a qoq basis, OPM fell 180bps as landed costs of iron ore jumped to
Rs5,400 per ton from Rs4,500 per ton in Q1 FY09. Landed cost of coal were Rs3,000 per ton, same as that of last
quarter. Raw material costs as a % of sales rose to 77.3% in Q2 FY09 from 76% in Q1 FY09 and 69.1% in Q2 FY08.
New projects online, to be completed by Q2FY10
The company in Q1 FY09 received the approval from Ministry of Environment & Forest for Mining of Iron Ore in Ari
Dongri Mines in Chhattisgarh. Mining is expected to start from Q3 FY09, earlier than expected. The company also plans
to build an iron ore crushing plant with a capacity of 1.2mtpa, a beneficiation plant with a capacity of 0.1mtpa and a
pelletization plant with a capacity of 0.6mtpa with railway siding and other infrastructure development, at a cost of
Rs2.35bn. Execution of the plan is on schedule and is expected to start production in Q2 FY10. The company has also
decided to set up another iron ore palletisation plant with a capacity of 0.6mtpa in Orissa through a Joint Venture in the
name of Ardent Steel Ltd., in which the company will have a 75% stake.
Company announces a buyback at a price not exceeding Rs135 per share
The company has announced to buy back equity shares at a price not exceeding Rs135 per share. The aggregate
amount to be spent on buy back of the equity shares shall not exceed Rs360mn, which is 9.37 % of the paid-up capital
as on March 31st, 2008. The company will buy back minimum 3,00,000 equity shares
Outlook
GPIL has been proactively taking steps to maximize its return on capital. Due to a slowdown in the demand for the
billets, the company reduced its production and started to sell power. Owing to the global financial crisis, demand for
steel products has reduced drastically. We expect the demand to be higher from the current levels in the next two
months. Steel and steel product prices have fallen more than 30% in the Asian markets. We expect steel realisations to
fall 30% from the current levels in Q3 FY09 and remain constant for the rest of the year. The company’s captive iron ore
mine will aid in decreasing the raw material cost pressure. Despite a fall in steel realisations, the company’s OPM is
expected to expand in FY10.
At CMP of Rs75, the stock trades at P/E multiple of 1.9x and 2.0x on estimated earnings of Rs39.5 in FY09E and Rs37.5
in FY10E, respectively. We recommend a BUY with a target price Rs110 based on an EV/EBIDTA multiple of 2.5x FY10E
EBIDTA of Rs1.86bn.
BSE Holidays 2008 / NSE Holidays 2008
Day Date Holiday
Thursday 6th March 2008 Mahashivratri
Thursday 20th March 2008 Id-E-Milad
Friday 21st March 2008 Good Friday / Holi
Monday 14th April 2008 Ambedkar Jayanti
Friday 18th April 2008 Mahavir Jayanti
Thursday 1st May 2008 Maharashtra Day
Monday 19th May 2008 Buddha Purnima
Friday 15th August 2008 Independence Day
Wednesday 3rd September 2008 Ganesh Chathurthi
Thursday 2nd October 2008 Ramzan Id / Gandhi Jayanti
Thursday 9th October 2008 Dasera
Tuesday 28th October 2008 Diwali (Laxmi Pujan)
Thursday 30th October 2008 Diwali (Bhaubeez)
Thursday 13th November 2008 Gurunanak Jayanti
Tuesday 9th December 2008 Bakri-Id
Thursday 25th December 2008 Christmas
Thursday 6th March 2008 Mahashivratri
Thursday 20th March 2008 Id-E-Milad
Friday 21st March 2008 Good Friday / Holi
Monday 14th April 2008 Ambedkar Jayanti
Friday 18th April 2008 Mahavir Jayanti
Thursday 1st May 2008 Maharashtra Day
Monday 19th May 2008 Buddha Purnima
Friday 15th August 2008 Independence Day
Wednesday 3rd September 2008 Ganesh Chathurthi
Thursday 2nd October 2008 Ramzan Id / Gandhi Jayanti
Thursday 9th October 2008 Dasera
Tuesday 28th October 2008 Diwali (Laxmi Pujan)
Thursday 30th October 2008 Diwali (Bhaubeez)
Thursday 13th November 2008 Gurunanak Jayanti
Tuesday 9th December 2008 Bakri-Id
Thursday 25th December 2008 Christmas
Alkali Metals IPO Allotment Status
IPO Allotment Status is now available online for Alkali Metals Limited IPO.
Alkali Metals Limited IPO was open on October 07, 2008 and closed on October 15, 2008. IPO was oversubscribed by 1.04 times (0.6255 times in retail).
Visit here to check your application status
Alkali Metals Limited IPO was open on October 07, 2008 and closed on October 15, 2008. IPO was oversubscribed by 1.04 times (0.6255 times in retail).
Visit here to check your application status
Post Market Report:29/10/2008
Volatility was the order of the day ahead of the expiry of the near
month October 2008 derivatives contracts. The market swung between
positive and negative negative zone throughout the day with Sensex
provisionally gaining 55.85 points or 0.62%. Gains in some Asian
and European marekts supported domestic bourses.
Reliance Communications slumped 10.59% wheeras Hindalco Industries
surged 18.24% ahead of their Q2 results due on Friday, 31 October
2008. The market breadth was weak, reflecting caution among
investors after a recent setback in share prices.
Major Asian markets rose on hopes the Bank of Japan and the Federal
Reserve will cut interest rates this week to spur growth, and as
credit markets continued to show signs of recovery. Key benchmark
indices in Japan and Taiwan were up by between 0.15% to 7.74%.
However, Key benchmark indices in China, Hong Kong, Singapore and
South Korea were down between 0.97% to 3.02%.
Key European markets also rose on Fed rate cut expectations. Key
benchmark indices in France and UK were up by between 3.93% to
6.24%. However, Germany's DAX fell 2.74%. The Fed is seen cutting
interest rates at a two-day policy meet that concludes today, 29
October 2008.
As per the provisional figures, the BSE 30-share Sensex was up
55.85 points or 0.62% to 9.063.93. The Sensex jumped 289.68 points
at the day's high of 9.297.76 in early trade. After a firm opening,
the market dipped in red for a while only to regain the positive
terrain. The Sensex fell 113.74 points at day's low of 8,894.34 in
mid-morning trade.
The S&P CNX Nifty was up 24.25 points or 0.9% to 2,708.85 as per
the provisional figures.
Most of the derivatives positions are normally rolled over at the
time of expiry of near month contracts. This is done by closing the
derivative position for the near month and taking a similar
position in the subsequent's month's series.
The BSE clocked a turnover of Rs 3,091 crore today, 29 October 2008
compared to a turnover of Rs 3388.65 on Monday, 27 October 2008.
The BSE Mid-Cap index was down 1.73% at 3,102.73. The BSE Small-Cap
index was down 0.72% at 3,684.80. Both the indices underperformed
the Sensex.
The market breadth was weak. On BSE, 1121 shares advanced as
compared to 1302 that declined. 74 shares remained unchanged.
India's largest private sector company by market capitalization and
oil refiner Reliance Industries (RIL) jumped 5.65% to Rs 1,218 on
shutting down polypropylene plant at the Jamnagar refinery complex
with the objective of improving product swing capability and
increasing propylene yield. The shutdown is expected to last for
approximately four weeks.
ACC (up 8.8% to Rs 482), Tata Power Company (up 5.25% to Rs 622),
Jaiprakash Associates (up 3.27% to Rs 61.60), were the major
gainers from the Sensex pack.
India's largest oil exploration firm by revenue ONGC rose 1.49%
ahead of Q2 September 2008 result to be announced today.
DLF (down 8.16% to Rs 19.90), Ranbaxy Laboratories (down 5.59% to
Rs 180.55), Hindustan Unilever (down 4.83% to Rs 208) were the
major losers from the Sensex pack.
Reliance Communications slumped 10.59% ahead of its Q2 results due
on Friday, 31 October 2008.
Auto stocks rose after Mahindra & Mahindra (M&M), India's largest
tractor maker by sales, said the demand for its products remains
healthy despite fears of a global recession. M&M rose 7.35%,
despite 20.6% fall in net profit to Rs 226.77 crore on 13.25% rise
in total income to Rs 3252.26 crore in Q2 September 2008 over Q2
September 2007. Maruti Suzuki India, Hero Honda Motors, Tata Motors
rose by between 0.15% to 5.28%.
Metal stocks rose on rebound in metal prices triggered by strong
rally in global stocks. The BSE Metal index gained 7.73% and was
the biggest gainer from the sectoral indices on BSE. Tata Steel,
Sterlite Industries, Hindustan Zinc rose between 2.49% to 15.13%.
India's largest aluminum maker by sales Hindalco Industries surged
18.24% ahead of Q2 September 2008 result due on riday 31 October
2008.
India's second largest aluminum producer by sales National Aluminum
Company dipped 1.85%, ahead of Q2 September 2008 result to be
announced today.
Banking stocks were mixed despite overnight spurt in American
depository receipts (ADRs). India's second largest private sector
bank by net profit HDFC Bank fell 1.98%. HDFC Bank ADR ended up
16.17%. India's largest private sector bank by net profit ICICI
Bank gained 3.19%, as ADR rose 18.96%. India's largest commercial
bank State Bank of India slipped 2.01%.
IT stocks were mixed as a strong rupee offset rally in ADRs.
India's third largest IT exporter by sales Satyam Computer Services
fell 5.44%, even as ADR rose 16.83%, India's fourth largest IT
exporter by sales Wipro rose 7.33%, as ADR jumped 22.84%. India's
second largest IT exporter by sales Infosys gained 1.82%, as ADR
jumped 15.55%. India's largest IT exporter by sales Tata
Consultancy Services jumped 0.37%.
Oracle Financial Services Software galloped 11.76% on winning an
overseas order.
India's rupee rose for a second day as local stocks extended their
best gains in two weeks made yesterday on optimism measures by
governments worldwide will ease the global credit crunch. The rupee
rose 0.1 % to 49.8325 per dollar from 49.8575 on 27 October.
Tata Tea lost 2.61% on reports it may cut tea prices.
month October 2008 derivatives contracts. The market swung between
positive and negative negative zone throughout the day with Sensex
provisionally gaining 55.85 points or 0.62%. Gains in some Asian
and European marekts supported domestic bourses.
Reliance Communications slumped 10.59% wheeras Hindalco Industries
surged 18.24% ahead of their Q2 results due on Friday, 31 October
2008. The market breadth was weak, reflecting caution among
investors after a recent setback in share prices.
Major Asian markets rose on hopes the Bank of Japan and the Federal
Reserve will cut interest rates this week to spur growth, and as
credit markets continued to show signs of recovery. Key benchmark
indices in Japan and Taiwan were up by between 0.15% to 7.74%.
However, Key benchmark indices in China, Hong Kong, Singapore and
South Korea were down between 0.97% to 3.02%.
Key European markets also rose on Fed rate cut expectations. Key
benchmark indices in France and UK were up by between 3.93% to
6.24%. However, Germany's DAX fell 2.74%. The Fed is seen cutting
interest rates at a two-day policy meet that concludes today, 29
October 2008.
As per the provisional figures, the BSE 30-share Sensex was up
55.85 points or 0.62% to 9.063.93. The Sensex jumped 289.68 points
at the day's high of 9.297.76 in early trade. After a firm opening,
the market dipped in red for a while only to regain the positive
terrain. The Sensex fell 113.74 points at day's low of 8,894.34 in
mid-morning trade.
The S&P CNX Nifty was up 24.25 points or 0.9% to 2,708.85 as per
the provisional figures.
Most of the derivatives positions are normally rolled over at the
time of expiry of near month contracts. This is done by closing the
derivative position for the near month and taking a similar
position in the subsequent's month's series.
The BSE clocked a turnover of Rs 3,091 crore today, 29 October 2008
compared to a turnover of Rs 3388.65 on Monday, 27 October 2008.
The BSE Mid-Cap index was down 1.73% at 3,102.73. The BSE Small-Cap
index was down 0.72% at 3,684.80. Both the indices underperformed
the Sensex.
The market breadth was weak. On BSE, 1121 shares advanced as
compared to 1302 that declined. 74 shares remained unchanged.
India's largest private sector company by market capitalization and
oil refiner Reliance Industries (RIL) jumped 5.65% to Rs 1,218 on
shutting down polypropylene plant at the Jamnagar refinery complex
with the objective of improving product swing capability and
increasing propylene yield. The shutdown is expected to last for
approximately four weeks.
ACC (up 8.8% to Rs 482), Tata Power Company (up 5.25% to Rs 622),
Jaiprakash Associates (up 3.27% to Rs 61.60), were the major
gainers from the Sensex pack.
India's largest oil exploration firm by revenue ONGC rose 1.49%
ahead of Q2 September 2008 result to be announced today.
DLF (down 8.16% to Rs 19.90), Ranbaxy Laboratories (down 5.59% to
Rs 180.55), Hindustan Unilever (down 4.83% to Rs 208) were the
major losers from the Sensex pack.
Reliance Communications slumped 10.59% ahead of its Q2 results due
on Friday, 31 October 2008.
Auto stocks rose after Mahindra & Mahindra (M&M), India's largest
tractor maker by sales, said the demand for its products remains
healthy despite fears of a global recession. M&M rose 7.35%,
despite 20.6% fall in net profit to Rs 226.77 crore on 13.25% rise
in total income to Rs 3252.26 crore in Q2 September 2008 over Q2
September 2007. Maruti Suzuki India, Hero Honda Motors, Tata Motors
rose by between 0.15% to 5.28%.
Metal stocks rose on rebound in metal prices triggered by strong
rally in global stocks. The BSE Metal index gained 7.73% and was
the biggest gainer from the sectoral indices on BSE. Tata Steel,
Sterlite Industries, Hindustan Zinc rose between 2.49% to 15.13%.
India's largest aluminum maker by sales Hindalco Industries surged
18.24% ahead of Q2 September 2008 result due on riday 31 October
2008.
India's second largest aluminum producer by sales National Aluminum
Company dipped 1.85%, ahead of Q2 September 2008 result to be
announced today.
Banking stocks were mixed despite overnight spurt in American
depository receipts (ADRs). India's second largest private sector
bank by net profit HDFC Bank fell 1.98%. HDFC Bank ADR ended up
16.17%. India's largest private sector bank by net profit ICICI
Bank gained 3.19%, as ADR rose 18.96%. India's largest commercial
bank State Bank of India slipped 2.01%.
IT stocks were mixed as a strong rupee offset rally in ADRs.
India's third largest IT exporter by sales Satyam Computer Services
fell 5.44%, even as ADR rose 16.83%, India's fourth largest IT
exporter by sales Wipro rose 7.33%, as ADR jumped 22.84%. India's
second largest IT exporter by sales Infosys gained 1.82%, as ADR
jumped 15.55%. India's largest IT exporter by sales Tata
Consultancy Services jumped 0.37%.
Oracle Financial Services Software galloped 11.76% on winning an
overseas order.
India's rupee rose for a second day as local stocks extended their
best gains in two weeks made yesterday on optimism measures by
governments worldwide will ease the global credit crunch. The rupee
rose 0.1 % to 49.8325 per dollar from 49.8575 on 27 October.
Tata Tea lost 2.61% on reports it may cut tea prices.
Pre Market Report 29/10/2008
Key benchmark indices are likely to open firm today, 29 October 2008, mirroring strong global equities buoyed by hopes of interest rate cut by the US Federal Reserve in its meeting scheduled later during the day. However volatility is likely to be at fore as derivative contracts for October 2008 series expire today, 29 October 2008.
As per reports, marketwide rollover of positions was 51% while that of Nifty stood at 52% from October 2008 series to November 2007, by Tuesday, 28 October 2008.
India Inc.'s report card for the September 2008 quarter so far shows a muted bottomline growth, due to ballooning interest cost. Aggregate results of 1072 companies showed a 6.8% rise in net profit on 29.10% increase in net sales in Q2 September 2008 over Q2 September 2007. Interest cost jumped 30% in Q2 September 2008 over Q2 September 2007.
Cairn India, Mahindra & Mahindra, ONGC, National Aluminium Company and Suzlon Energy will declare their September 2008 quarterly results today, 29 October 2008.
US markets rallied on Tuesday, 28 October 2008 on bargain-hunting with expectations of a interest rate cut by the US Federal Reserve in its meeting scheduled later during the day propelled the rally. The Dow Jones surged 889.35 points, or 10.88%, to 9,065.12. It was the second-biggest point gain on record and the seventh-largest percentage gain. The S&P 500 index advanced 91.59 points, or 10.79%, to 940.51, and the Nasdaq Composite index added 143.57 points, or 9.53%, to 1,649.47.
Most Asian markets were trading higher today, 29 October 2008, following an overnight rally on Wall Street as hopes mounted for further interest rate cuts to shore up the global economy. Hong Kong's Hang Seng gained 2.76% or 348.12 points at 12,944.41. Japan's Nikkei rose 6.39% or 487.42 points at 8,109.34, Singapore's Straits Times surged 2.28% or 38.01 points at 1,704.50, South Korea's Seoul Composite advanced 3.30% or 32.98 points at 1,032.14, Taiwan's Taiwan Weighted was up 2.43% or 106.99 points at 4,506.96. However, China's Shanghai Composite was down 1.13% or 20.06 points at 1,751.7.
Firm global markets and relaxation of creeping acquisition norms for promoters boosted the battered bourses on the special one-hour Muhurat trading session for Samvat 2065 on 28 October 2008. The BSE 30-share Sensex jumped 498.52 points, or 5.85%, to 9,008.08 and the S&P CNX Nifty was up 167.70 points, or 6.64%, to 2,691.90, recording its biggest Muhurat day gain in 18 years.
Foreign institutional investors (FIIs) were net sellers worth Rs 69.18 crore while mutual funds bought shares worth Rs 24.78 crore on Tuesday, 28 October 2008, according to provisional data on NSE.
US light crude for December 2008 delivery was up $2.32 at $65.05 a barrel today, 29 October 2008 after US stock indices rallied, helping draw some investors back into beaten-down risk assets.
As per reports, marketwide rollover of positions was 51% while that of Nifty stood at 52% from October 2008 series to November 2007, by Tuesday, 28 October 2008.
India Inc.'s report card for the September 2008 quarter so far shows a muted bottomline growth, due to ballooning interest cost. Aggregate results of 1072 companies showed a 6.8% rise in net profit on 29.10% increase in net sales in Q2 September 2008 over Q2 September 2007. Interest cost jumped 30% in Q2 September 2008 over Q2 September 2007.
Cairn India, Mahindra & Mahindra, ONGC, National Aluminium Company and Suzlon Energy will declare their September 2008 quarterly results today, 29 October 2008.
US markets rallied on Tuesday, 28 October 2008 on bargain-hunting with expectations of a interest rate cut by the US Federal Reserve in its meeting scheduled later during the day propelled the rally. The Dow Jones surged 889.35 points, or 10.88%, to 9,065.12. It was the second-biggest point gain on record and the seventh-largest percentage gain. The S&P 500 index advanced 91.59 points, or 10.79%, to 940.51, and the Nasdaq Composite index added 143.57 points, or 9.53%, to 1,649.47.
Most Asian markets were trading higher today, 29 October 2008, following an overnight rally on Wall Street as hopes mounted for further interest rate cuts to shore up the global economy. Hong Kong's Hang Seng gained 2.76% or 348.12 points at 12,944.41. Japan's Nikkei rose 6.39% or 487.42 points at 8,109.34, Singapore's Straits Times surged 2.28% or 38.01 points at 1,704.50, South Korea's Seoul Composite advanced 3.30% or 32.98 points at 1,032.14, Taiwan's Taiwan Weighted was up 2.43% or 106.99 points at 4,506.96. However, China's Shanghai Composite was down 1.13% or 20.06 points at 1,751.7.
Firm global markets and relaxation of creeping acquisition norms for promoters boosted the battered bourses on the special one-hour Muhurat trading session for Samvat 2065 on 28 October 2008. The BSE 30-share Sensex jumped 498.52 points, or 5.85%, to 9,008.08 and the S&P CNX Nifty was up 167.70 points, or 6.64%, to 2,691.90, recording its biggest Muhurat day gain in 18 years.
Foreign institutional investors (FIIs) were net sellers worth Rs 69.18 crore while mutual funds bought shares worth Rs 24.78 crore on Tuesday, 28 October 2008, according to provisional data on NSE.
US light crude for December 2008 delivery was up $2.32 at $65.05 a barrel today, 29 October 2008 after US stock indices rallied, helping draw some investors back into beaten-down risk assets.
ikkei surges over 7 pct on BOJ rate cut hopes, yen
TOKYO (Reuters) - Japan's Nikkei average rose 7.5 percent on Wednesday after the yen fell on hopes that the Bank of Japan will cut interest rates at a policy-setting meeting later this week, with exporters such as Sony Corp gaining.
The BOJ will consider cutting rates on this week, but the bank will watch market conditions before making a final decision, a source informed on the matter said.
The Nikkei business daily also reported earlier on Wednesday without citing sources that the central bank is leaning towards cutting its 0.5 percent target for the unsecured overnight call money rate to 0.25 percent.
"Hopes of a BOJ rate cut are everything," said Masayoshi Okamoto, head of trading at Jujiya Securities.
"But as long as the dollar is below 100 yen there will be worries about Japanese company earnings in the second half of this business year, and this will limit the Nikkei's rebound."
The yen posted its biggest daily fall against the U.S. currency since 1974 on the Nikkei report of a BOJ rate cut but later trimmed losses and was fetching around 97.70 yen .
Speculation over rate cuts by the BOJ and the Fed sparked a wave of bargain hunting in U.S. shares that helped Wall Street log its second-biggest one-day gain ever.
The benchmark Nikkei gained nearly 570 points to 8,190.56 although volume still appeared relatively thin after two days of heavy trade. On Tuesday it briefly touched a 26-year low before ending up more than 6 percent. The broader Topix was up 6.8 percent to 837.22. Sony climbed 4 percent to 2,075 yen and Canon Inc rose 7.8 percent to 2,750 yen.
Beaten-down Japanese banks also surged, with Mitsubishi UFJ Financial Group up 13 percent at 622 yen and Mizuho Financial Group up 9.3 percent at 234,900 yen
Wall St scores 2nd-best day ever on rate-cut hopes
NEW YORK (Reuters) - Wall Street marked its second-best day ever on Tuesday as investors, convinced that central banks worldwide will cut rates even more, scooped up stocks that had been driven down to their lowest prices in more than five years.
A big catalyst for the late-day surge was a huge drop in the Japanese yen after a news report that the Bank of Japan may cut interest rates later this week. A sudden strengthening of the yen during the past week had been destabilizing stock markets around the world, and Tuesday's reversal of that trend was greeted with relief by investors.
The Federal Reserve is expected to cut its benchmark fed funds rate by at least 50 basis points on Wednesday when it concludes a two-day meeting that began this afternoon.
Shares of capital-hungry companies such as telecoms posted the day's sharpest gains, including Verizon Communications, up over 14 percent, and AT&T, up over 13 percent.
Big oil companies gave the Dow its biggest boost after British major BP Plc reported a record quarterly profit, beating expectations. Exxon Mobil and Chevron both rose more than 13 percent.
Shares of Boeing jumped 15.5 percent to $48.91 after the aircraft manufacturer reached a tentative agreement with its largest union to end a strike and stop revenue losses estimated at $100 million a day.
Typically when the market gets to oversold extremes, stocks see a bounce back, said Michael Sheldon, chief market strategist at RDM Financial in Westport, Connecticut.
"If you believe that governments around the world are going to be successful in reengerizing financial markets and gradually bringing back confidence and stability in the weeks and months ahead, then you probably want to be more of a buyer than a seller," Sheldon said.
The Dow Jones industrial average jumped 889.35 points, or 10.88 percent, to 9,065.12. The Standard & Poor's 500 Index surged 91.59 points, or 10.79 percent, to 940.51. The Nasdaq Composite Index ran up 143.57 points, or 9.53 percent, to 1,649.47.
It was the second-biggest point gain ever for the Dow and the S&P. These advances were surpassed only by the rally on Oct. 13, when the Dow jumped 936.42 points and the S&P 500 climbed 104.13 points after governments pledged to pour cash into struggling banks and a Japanese banking group completed its investment in Morgan Stanley.
The yen's recent rally forced an unwinding of the so-called "carry trade" -- a phenomenon of Japan's low interest rates, in which investors borrowed yen to finance investments in high er-yielding assets, such as U.S. stocks.
On Tuesday, the dollar achieved its biggest gain against the yen since 1974, according to Reuters data.
Wall Street also got a lift as investors moved to readjust their stock portfolios as a rough month for stocks draws to a close.
Wal-Mart's stock rose after the world's largest retailer stuck to its 2009 sales growth forecast, saying it will weather the economic turmoil now and could come out even stronger than its rivals when the economy rebounds. Wal-Mart shot up 11.1 percent to $55.17 on the New York Stock Exchange.
The rally came despite an economic picture that remained gloomy after data showed U.S. consumer confidence tumbled to a record low in October as the financial crisis made Americans anxious about their jobs and pessimistic about the future.
The gains were widespread, including shares of home builders that rose even in the face of data that showed prices of U.S. single-family homes plunged a record 16 .6 percent in August from a year earlier. D.R. Horton Inc climbed 9.8 percent to $5.16.
Even the Dow Jones index of home builders' shares finished up 6.01 percent.
Verizon ended at $31.65, up 14.6 percent, and AT&T finished at $27.61, up 13.2 percent, in NYSE trading.
In the oil sector, Exxon climbed 13.3 percent to $74.86, while Chevron soared 13.5 percent to $70.02. The big energy producers' shares gained even as front-month U.S. oil futures slipped 49 cents to settle at $62.73 a barrel.
Whirlpool Corp tumbled 8.3 percent to $45.87 after the world's biggest appliance maker said it would cut 7 percent of its workforce and slashed its 2008 earnings outlook amid weakening demand.
Trading was moderate on the New York Stock Exchange, with about 1.73 billion shares changing hands, below last year's estimated daily average of roughly 1.90 billion. Most of the volume came in the last hour of trading.
On Nasdaq, about 2.77 billion shares traded, above last year's daily average of 2.17 billion.
Advancing stocks outnumbered declining ones on the NYSE by about 4 to 1 while on the Nasdaq, slightly more than two stocks rose for every one that fell.
A big catalyst for the late-day surge was a huge drop in the Japanese yen after a news report that the Bank of Japan may cut interest rates later this week. A sudden strengthening of the yen during the past week had been destabilizing stock markets around the world, and Tuesday's reversal of that trend was greeted with relief by investors.
The Federal Reserve is expected to cut its benchmark fed funds rate by at least 50 basis points on Wednesday when it concludes a two-day meeting that began this afternoon.
Shares of capital-hungry companies such as telecoms posted the day's sharpest gains, including Verizon Communications, up over 14 percent, and AT&T, up over 13 percent.
Big oil companies gave the Dow its biggest boost after British major BP Plc reported a record quarterly profit, beating expectations. Exxon Mobil and Chevron both rose more than 13 percent.
Shares of Boeing jumped 15.5 percent to $48.91 after the aircraft manufacturer reached a tentative agreement with its largest union to end a strike and stop revenue losses estimated at $100 million a day.
Typically when the market gets to oversold extremes, stocks see a bounce back, said Michael Sheldon, chief market strategist at RDM Financial in Westport, Connecticut.
"If you believe that governments around the world are going to be successful in reengerizing financial markets and gradually bringing back confidence and stability in the weeks and months ahead, then you probably want to be more of a buyer than a seller," Sheldon said.
The Dow Jones industrial average jumped 889.35 points, or 10.88 percent, to 9,065.12. The Standard & Poor's 500 Index surged 91.59 points, or 10.79 percent, to 940.51. The Nasdaq Composite Index ran up 143.57 points, or 9.53 percent, to 1,649.47.
It was the second-biggest point gain ever for the Dow and the S&P. These advances were surpassed only by the rally on Oct. 13, when the Dow jumped 936.42 points and the S&P 500 climbed 104.13 points after governments pledged to pour cash into struggling banks and a Japanese banking group completed its investment in Morgan Stanley.
The yen's recent rally forced an unwinding of the so-called "carry trade" -- a phenomenon of Japan's low interest rates, in which investors borrowed yen to finance investments in high er-yielding assets, such as U.S. stocks.
On Tuesday, the dollar achieved its biggest gain against the yen since 1974, according to Reuters data.
Wall Street also got a lift as investors moved to readjust their stock portfolios as a rough month for stocks draws to a close.
Wal-Mart's stock rose after the world's largest retailer stuck to its 2009 sales growth forecast, saying it will weather the economic turmoil now and could come out even stronger than its rivals when the economy rebounds. Wal-Mart shot up 11.1 percent to $55.17 on the New York Stock Exchange.
The rally came despite an economic picture that remained gloomy after data showed U.S. consumer confidence tumbled to a record low in October as the financial crisis made Americans anxious about their jobs and pessimistic about the future.
The gains were widespread, including shares of home builders that rose even in the face of data that showed prices of U.S. single-family homes plunged a record 16 .6 percent in August from a year earlier. D.R. Horton Inc climbed 9.8 percent to $5.16.
Even the Dow Jones index of home builders' shares finished up 6.01 percent.
Verizon ended at $31.65, up 14.6 percent, and AT&T finished at $27.61, up 13.2 percent, in NYSE trading.
In the oil sector, Exxon climbed 13.3 percent to $74.86, while Chevron soared 13.5 percent to $70.02. The big energy producers' shares gained even as front-month U.S. oil futures slipped 49 cents to settle at $62.73 a barrel.
Whirlpool Corp tumbled 8.3 percent to $45.87 after the world's biggest appliance maker said it would cut 7 percent of its workforce and slashed its 2008 earnings outlook amid weakening demand.
Trading was moderate on the New York Stock Exchange, with about 1.73 billion shares changing hands, below last year's estimated daily average of roughly 1.90 billion. Most of the volume came in the last hour of trading.
On Nasdaq, about 2.77 billion shares traded, above last year's daily average of 2.17 billion.
Advancing stocks outnumbered declining ones on the NYSE by about 4 to 1 while on the Nasdaq, slightly more than two stocks rose for every one that fell.
Monday, October 27, 2008
Sensex cuts sharp early losses in choppy trade; ends provisionally above 8,500 level
Key benchmark indices witnessed sharp intra-day pullback in second
half of the day's trading session helped by short covering of
derivative positions ahead of the expiry on Wednesday, 29 October
2008, after plunging to over 3-year low in the first half spooked
by weak global equities. Volatility was the hallmark of the day's
trading session. The market breadth was weak.
The opening volatility on the bourses followed the slump in Asian
markets to five-year lows, following the poor showing by the US
markets overnight on concerns of looming US recession worries and
global economic slowdown decelerating corporate earnings growth.
Key benchmark indices in China, Hong Kong, South Korea, Taiwan, and
Japan slipped between 0.80% and 6.36% today, 27 October 2008.
European markets were not spared from the global bloodbath either
as indices in France, Germany and UK fell between 3.16% to 6.31%.
The Dow Jones industrial average futures were down about 200 points
today, 24 October 2008. S&P 500 and Nasdaq 100 futures also fell
sharply as turmoil gripped markets around the world. Futures
measure current index values against perceived future performance
and give an indication of how markets may open when trading begins
in New York.
The BSE 30-share Sensex declined 180.49 points, or 2.07%, to
provisionally close at 8,520.58, after slumping 1,003.68 points to
7,697.39 in afternoon trade, its lowest since 28 October 2005. At
the day's high of 8,739.48 hit in early trade, the Sensex rose
38.41 points. The Sensex had opened 112.21 points lower at
8,588.86.
The S&P CNX Nifty lost 51.60 points, or 2%, to 2,532.40 as per the
provisional figures, after tanking to a low of 2252.75, its lowest
since 22 July 2005.
The market breadth, indicating the overall health of the market,
was weak with 1,996 shares declining compared with just 538 that
rose. 41 shares remained unchanged.
The volatility is attributed to the expiry of the derivative
contracts for October 2008 series on Wednesday, 29 October 2008. As
per reports, marketwide rollover of positions was 37%, while that
of Nifty stood at 45% from the October 2008 series to November
2007, by Friday, 24 October 2008. The rollovers are fairly high,
indicating market players are uncertain about the direction of the
market.
Among the 30-member Sensex pack, 21 declined while the rest gainer.
Mahindra & Mahindra (down 15.67% to Rs 241.80), Tata Motors (down
13.73% to Rs 1404.40), Grasim Industries (down 10.2% to Rs 946)
were the key losers from the Sensex pack.
India's largest state-run bank by net profit State Bank of India
(SBI) fell 9.2% to Rs 1050 on muted growth in consolidated net
profit in Q2 September 2008. In its results declared before market
hours today, 27 October 2008, SBI reported a 10.60% rise in
consolidated net profit to Rs 2378.19 crore on a 26.4% increase in
total income to Rs 27083.47 crore in Q2 September 2008 over Q2
September 2007. The consolidated earnings include numbers from
recently acquired State Bank of Saurashtra.
India's largest private sector company by market capitalization and
oil refiner Reliance Industries (RIL) jumped 6.25% to Rs 1,079,
making a strong recovery from day's low of Rs 930 . RIL's net
profit rose 7.4% to Rs 4122 crore on 39.8% growth in sales to Rs
44787 crore in Q2 September 2008 over Q2 September 2007, the
company said after market hours on Thursday, 23 October 2008.
Select Sensex stocks reversed early losses. India's second largest
IT exporter by sales Infosys was rose 0.3% to Rs 1252.50 after
hitting an intra-day low of Rs 1,161. Sterlite Industries rose
1.49% to Rs 211.45 off from day's low of Rs 164.50. India's largest
private sector bank by net profit ICICI Bank rose 1.61% to Rs 315
after declining to low of Rs 282.15. India's largest telecom
services provider by market share Reliance Communications surged
6.33% to Rs 205.65 off day's low of Rs 148.60. Bharti Airtel,
India's largest telecom services provider by market share jumped
10.17% to Rs 588.80, off day's low of Rs 484. Reliance
Infrastructure rose 5.13% to Rs 401, recovering from low of Rs 354.
India's third largest IT exporter by sales Satyam Computer Services
rose 2.28% to Rs 293.40 off day's low of Rs 240.25. Its ADR slid
6.9% in US on Friday.
India's fourth largest IT exporter by sales Wipro tumbled 6.4% to
Rs 220.10 off day's low of Rs 181.70. Its ADR shed 9.6% on Friday
in US.
India's second largest power generation company in terms of net
profit Tata Power Company slumped 8.75% to Rs 570.25 ahead of its
Q2 results today, 27 October 2008.
BSE Realty index rose 4.25% and was the major gainer from the
sectoral indices on BSE. Realty majors, Indiabulls Real Estate,
Unitech rose between 15.07% to 41.86%. However, India's largest
real estate player by market capitalization DLF fell 2.84% to Rs
198.10 off day's low of Rs 158.
Central banks across the globe are likely to launch new coordinated
emergency action this week to calm panic in financial markets.
Reports indicate the US Federal Reserve is widely expected to
announce a 50 basis-point cut in overnight rates on Wednesday, 29
October 2008 that would take them to 1%, the lowest level since
June 2004, with some expecting an even deeper reduction to 0.75%.
The US markets had declined in volatile trade on Friday, 24 October
2008, as fears of a full-blown global recession intensified and
investors dumped risky assets. The Dow Jones Industrial Average
plunged 312.30 points, or 3.59%, to 8,378.95. The S&P 500 index
slipped 31.34 points, or 3.45%, to 876.77, and the Nasdaq Composite
index lost 51.88 points, or 3.23%, to 1,552.03.
Back home, markets suffered a severe setback on Friday 24 October
2008, plunging to three-year lows mirroring weak global equities on
worries about a sharp global economic slowdown and disappointment
from the second quarter monetary policy review of the Reserve Bank
of India. The BSE 30-share Sensex plunged 1070.63 points, or
10.96%, to 8,701.07, recording its biggest fall in percentage terms
since May 2004 and the S&P CNX Nifty was down 359.50 points or
12.2% to 2,584.
Crude oil was little changed in New York near a 16-month low amid
expectations that OPEC's decision to cut production will start to
bring supply back in line with demand that is being curbed by the
global financial crisis. Crude oil for December delivery was at
$US63.93 a barrel down 22 cents, in after-hours electronic trading
on the New York Mercantile Exchange today.
The Indian currency continued its downward march and plunged to
50.05 against the greenback in early trade on Monday.
half of the day's trading session helped by short covering of
derivative positions ahead of the expiry on Wednesday, 29 October
2008, after plunging to over 3-year low in the first half spooked
by weak global equities. Volatility was the hallmark of the day's
trading session. The market breadth was weak.
The opening volatility on the bourses followed the slump in Asian
markets to five-year lows, following the poor showing by the US
markets overnight on concerns of looming US recession worries and
global economic slowdown decelerating corporate earnings growth.
Key benchmark indices in China, Hong Kong, South Korea, Taiwan, and
Japan slipped between 0.80% and 6.36% today, 27 October 2008.
European markets were not spared from the global bloodbath either
as indices in France, Germany and UK fell between 3.16% to 6.31%.
The Dow Jones industrial average futures were down about 200 points
today, 24 October 2008. S&P 500 and Nasdaq 100 futures also fell
sharply as turmoil gripped markets around the world. Futures
measure current index values against perceived future performance
and give an indication of how markets may open when trading begins
in New York.
The BSE 30-share Sensex declined 180.49 points, or 2.07%, to
provisionally close at 8,520.58, after slumping 1,003.68 points to
7,697.39 in afternoon trade, its lowest since 28 October 2005. At
the day's high of 8,739.48 hit in early trade, the Sensex rose
38.41 points. The Sensex had opened 112.21 points lower at
8,588.86.
The S&P CNX Nifty lost 51.60 points, or 2%, to 2,532.40 as per the
provisional figures, after tanking to a low of 2252.75, its lowest
since 22 July 2005.
The market breadth, indicating the overall health of the market,
was weak with 1,996 shares declining compared with just 538 that
rose. 41 shares remained unchanged.
The volatility is attributed to the expiry of the derivative
contracts for October 2008 series on Wednesday, 29 October 2008. As
per reports, marketwide rollover of positions was 37%, while that
of Nifty stood at 45% from the October 2008 series to November
2007, by Friday, 24 October 2008. The rollovers are fairly high,
indicating market players are uncertain about the direction of the
market.
Among the 30-member Sensex pack, 21 declined while the rest gainer.
Mahindra & Mahindra (down 15.67% to Rs 241.80), Tata Motors (down
13.73% to Rs 1404.40), Grasim Industries (down 10.2% to Rs 946)
were the key losers from the Sensex pack.
India's largest state-run bank by net profit State Bank of India
(SBI) fell 9.2% to Rs 1050 on muted growth in consolidated net
profit in Q2 September 2008. In its results declared before market
hours today, 27 October 2008, SBI reported a 10.60% rise in
consolidated net profit to Rs 2378.19 crore on a 26.4% increase in
total income to Rs 27083.47 crore in Q2 September 2008 over Q2
September 2007. The consolidated earnings include numbers from
recently acquired State Bank of Saurashtra.
India's largest private sector company by market capitalization and
oil refiner Reliance Industries (RIL) jumped 6.25% to Rs 1,079,
making a strong recovery from day's low of Rs 930 . RIL's net
profit rose 7.4% to Rs 4122 crore on 39.8% growth in sales to Rs
44787 crore in Q2 September 2008 over Q2 September 2007, the
company said after market hours on Thursday, 23 October 2008.
Select Sensex stocks reversed early losses. India's second largest
IT exporter by sales Infosys was rose 0.3% to Rs 1252.50 after
hitting an intra-day low of Rs 1,161. Sterlite Industries rose
1.49% to Rs 211.45 off from day's low of Rs 164.50. India's largest
private sector bank by net profit ICICI Bank rose 1.61% to Rs 315
after declining to low of Rs 282.15. India's largest telecom
services provider by market share Reliance Communications surged
6.33% to Rs 205.65 off day's low of Rs 148.60. Bharti Airtel,
India's largest telecom services provider by market share jumped
10.17% to Rs 588.80, off day's low of Rs 484. Reliance
Infrastructure rose 5.13% to Rs 401, recovering from low of Rs 354.
India's third largest IT exporter by sales Satyam Computer Services
rose 2.28% to Rs 293.40 off day's low of Rs 240.25. Its ADR slid
6.9% in US on Friday.
India's fourth largest IT exporter by sales Wipro tumbled 6.4% to
Rs 220.10 off day's low of Rs 181.70. Its ADR shed 9.6% on Friday
in US.
India's second largest power generation company in terms of net
profit Tata Power Company slumped 8.75% to Rs 570.25 ahead of its
Q2 results today, 27 October 2008.
BSE Realty index rose 4.25% and was the major gainer from the
sectoral indices on BSE. Realty majors, Indiabulls Real Estate,
Unitech rose between 15.07% to 41.86%. However, India's largest
real estate player by market capitalization DLF fell 2.84% to Rs
198.10 off day's low of Rs 158.
Central banks across the globe are likely to launch new coordinated
emergency action this week to calm panic in financial markets.
Reports indicate the US Federal Reserve is widely expected to
announce a 50 basis-point cut in overnight rates on Wednesday, 29
October 2008 that would take them to 1%, the lowest level since
June 2004, with some expecting an even deeper reduction to 0.75%.
The US markets had declined in volatile trade on Friday, 24 October
2008, as fears of a full-blown global recession intensified and
investors dumped risky assets. The Dow Jones Industrial Average
plunged 312.30 points, or 3.59%, to 8,378.95. The S&P 500 index
slipped 31.34 points, or 3.45%, to 876.77, and the Nasdaq Composite
index lost 51.88 points, or 3.23%, to 1,552.03.
Back home, markets suffered a severe setback on Friday 24 October
2008, plunging to three-year lows mirroring weak global equities on
worries about a sharp global economic slowdown and disappointment
from the second quarter monetary policy review of the Reserve Bank
of India. The BSE 30-share Sensex plunged 1070.63 points, or
10.96%, to 8,701.07, recording its biggest fall in percentage terms
since May 2004 and the S&P CNX Nifty was down 359.50 points or
12.2% to 2,584.
Crude oil was little changed in New York near a 16-month low amid
expectations that OPEC's decision to cut production will start to
bring supply back in line with demand that is being curbed by the
global financial crisis. Crude oil for December delivery was at
$US63.93 a barrel down 22 cents, in after-hours electronic trading
on the New York Mercantile Exchange today.
The Indian currency continued its downward march and plunged to
50.05 against the greenback in early trade on Monday.
Sensex nosedives over 650 points to near 8,000 level
A brief recovery in mid-morning trade proved futile with the key
indices hitting day's low on frenzied selling in index pivotals,
with global cues playing the spoilsoprts. Metal, banking and IT
stocks were hammered brutally. The market breadth was dismal.
The opening volatility on the bourses followed the slump in Asian
markets to five-year lows, following the poor showing by the US
markets overnight on concerns of the looming US recession and
global economic slowdown decelerating corporate earnings growth.
Key benchmark indices in China, Hong Kong, South Korea, Taiwan, and
Japan slipped between 0.80% and 6.36% today, 27 October 2008.
At 12:29 IST, the BSE 30-share Sensex tumbled 664.78 points, or
7.53%, to 8,046.21. The Sensex opened 112.21 points lower at
8,588.86. The Sensex had lost 686.30 points to a three-year low of
8,014.77 in early afternoon trade. At the day's high of 8,739.48,
the Sensex had risen 38.41 points.
The S&P CNX Nifty lost 224.85 points, or 8.70%, to 2359.15, after
tanking to a three-year low of 2356.95.
The market breadth, indicating the overall health of the market,
was weak with 2,043 shares declining compared with just 294 that
rose. But 40 shares remained unchanged.
The total turnover on the BSE amounted to Rs 1420 crore by 12:30
IST compared with Rs 929 crore by 11:30 IST
The volatility is attributed to the expiry of the derivative
contracts for October 2008 series on Wednesday, 29 October 2008. As
per reports, marketwide rollover of positions was 37%, while that
of Nifty stood at 45% from the October 2008 series to November
2007, by Friday, 24 October 2008. The rollovers are fairly high,
indicating market players are uncertain about the direction of the
market.
Bhart Airtel was the lone gainer among the 30-member Sensex pack.
India's biggest listed cellular services provider gained 0.57% to
Rs 537.50. The stock moved in a range of Rs 552 and Rs 502.20 in
choppy trade.
Jaiprakash Associates (down 12.04% to Rs 52.40), Hindustan Unilever
(down 12.41% to Rs 197), and Reliance Communications (down 10.63%
to Rs 172.50) were the other key losers from the Sensex pack.
India's largest private sector company by market capitalization and
oil refiner Reliance Industries (RIL) fell 1.92% to Rs 996 in
volatile trade. It hit a 52-week low of Rs 980 in early trade.
RIL's net profit rose 7.4% to Rs 4122 crore on 39.8% growth in
sales to Rs 44787 crore in Q2 September 2008 over Q2 September
2007, the company said after market hours on Thursday, 23 October
2008.
Real estate shares, barring Unitech, continued their slide, with
the BSE Realty index declining 4.36% to 1,667.34. The BSE Realty
index has wiped off 87.59% from its record high of 13848.09 hit on
8 January 2008 on concern the global credit crunch would choke real
estate companies as borrowing costs rise and property prices
tumble.
DLF, holding the biggest weightage in BSE Realty index collapsed
12.90% to Rs 178. Indiabulls Real Estate (down 2.32% to Rs 94.60),
HDIL (down 12.57% to Rs 119.60), and Akruti City (down 6.64% to Rs
572) were not spared either.
Unitech, with third largest weightage in the BSE Realty index,
jumped 29.24% to Rs 38.90 after the company filed a complaint with
the market regulator against some brokers for hammering its shares
51% on 24 October 2008.
Metal shares slumped on fears a recession in the US will lead to
slowdown in demand. Tata Steel (down 9.09% to Rs 162), Nalco (down
21.75% to Rs 125.35), and Sterlite Industries (down 8.32% to Rs
191.30), and Hindalco Industries (down 9% to Rs 39.45) lead a 8.03%
decline to 4,041.04 in the BSE Metal index.
IT stocks fell despite the Indian rupee extending its losses to the
ninth day in a row today, easing 11 paise to 50.06 against the US
currency. IT firms derive a lion's share of their revenues from
exports to the US, and a declining rupee augurs well for them. But
many IT companies have taken forward cover for their foreign
exchange receipts in the belief the rupee would keep on
appreciating. Thus, the gains due to the rupee's depreciation would
be neutralised by hedging losses.
India's fourth largest IT exporter by sales Wipro tumbled 14.52% to
Rs 201 and was the top loser from the Sensex pack.
India's largest IT exporter by sales TCS fell 6.98% to Rs 456. TCS'
net profit fell 2.57% to Rs 1173.04 on a 9.36% rise in sales to Rs
5699.96 in Q2 September 2008 over Q1 June 2008. The company
announced the results on 23 October 2008.
India's third largest IT exporter by sales Satyam Computer Services
slipped 5.11% to Rs 272.20. The company raised its earnings
guidance in rupee terms at the time of announcing Q2 September 2008
results on Friday, 17 October 2008.
India's second largest IT exporter by sales Infosys was down 4.70%
to Rs 1190.
India's second largest power generation company in terms of net
profit Tata Power Company slumped 12.77% to Rs 545.10 ahead of its
Q2 results today, 27 October 2008.
Banking shares extended the losses of Friday, 24 October 2008 as
disappointed investors dumped banking shares after the central
bank's mid-term monetary policy review did not announce any
measures to boost liquidity.
On Friday, 24 October 2008, the Reseve Bank of India (RBI) kept all
the key rates unchanged even as it lowered its 2008-09 growth
forecast to 7.5% to 8% from a previous forecast of around 8%. The
RBI also left the cash reserve ratio, the amount of funds that
banks have to keep on deposit with it, unchanged at 6.5%.
India's second largest bank by market capitalisation HDFC Bank lost
7.98% to Rs 895. India's second largest private sector bank by
market capitalisation ICICI Bank slipped 4.65% to Rs 295.60 ahead
of its Q2 September 2008 results today, 27 October 2008. In the
midst of a credit turmoil gripping economies across the world,
marketmen will focus on ICICI Bank's result for its exposure to
some of the crisis-ridden institutions in the US including Lehman
Brothers Holdings Inc.
India's largest state-run bank by net profit State Bank of India
(SBI) fell 12.48% to Rs 1012.05 on muted growth in consolidated net
profit in Q2 September 2008. In its results declared before market
hours today, 27 October 2008, SBI reported a 10.60% rise in
consolidated net profit to Rs 2378.19 crore on a 26.4% increase in
total income to Rs 27083.47 crore in Q2 September 2008 over Q2
September 2007. The consolidated earnings include numbers from
recently acquired State Bank of Saurashtra.
Jet Airways (India) tumbled 13.16% to Rs 148.80 after reporting its
biggest quarterly loss in more than three years on soaring fuel
expenses. The company declared the results on 25 October 2008,
reporting a net loss of Rs 384.53 crore in Q2 September 2008 as
against a net profit of Rs 28.36 crore in Q2 September 2007. Sales
rose 71.6% to Rs 3121.34 crore in Q2 September 2008 over Q2
September 2007.
Brigade Enterprises tumbled 16.07% to Rs 38.40 despite seeing an
intra-day spike to Rs 45 with 20.26 lakh shares changing hands at
that level in a bulk deal on BSE at 11:31 IST.
PSU oil marketing companies HPCL (down 8.57% to Rs 173.35), BPCL
(down 11.51% to Rs 249.05), and IOC (down 7.26% to Rs 317) in a
weak overall market, despite the US light crude for December 2008
delivery sliding 22 cents to $63.93 a barrel today, 27 October
2008. It also touched a 17-month low of $63.67 as an emergency
production cut by OPEC was shrugged off by traders anxious about
the onset of a deep global recession.
India Inc.'s report card for the September 2008 quarter so far
shows a muted bottomline growth, partly due to a surge in interest
cost. Aggregate results of 875 companies showed a 6.2% rise in net
profit on 28.5% increase in net sales in Q2 September 2008 over Q2
September 2007. Interest cost jumped 35.6% in Q2 September 2008
over Q2 September 2007.
While governments and central banks across the globe are expected
to take further dramatic action to prop up the global financial
system this week, there is concern this would not be enough to
prevent companies from slashing production and jobs as sales get
hit and financing remains difficult.
Central banks are likely to launch new coordinated emergency action
this week to calm panic in financial markets. Reports indicate the
US Federal Reserve is widely expected to announce a 50 basis-point
cut in overnight rates on Wednesday, 29 October 2008 that would
take them to 1%, the lowest level since June 2004, with some
expecting an even deeper reduction to 0.75%.
The US markets had declined in volatile trade on Friday, 24 October
2008, as fears of a full-blown global recession intensified and
investors dumped risky assets. The Dow Jones Industrial Average
plunged 312.30 points, or 3.59%, to 8,378.95. The S&P 500 index
slipped 31.34 points, or 3.45%, to 876.77, and the Nasdaq Composite
index lost 51.88 points, or 3.23%, to 1,552.03.
Back home, markets suffered a severe setback on Friday 24 October
2008, plunging to three-year lows mirroring weak global equities on
worries about a sharp global economic slowdown and disappointment
from the second quarter monetary policy review of the Reserve Bank
of India. The BSE 30-share Sensex plunged 1070.63 points, or
10.96%, to 8,701.07, recording its biggest fall in percentage terms
since May 2004 and the S&P CNX Nifty was down 359.50 points or
12.2% to 2,584.
Foreign institutional investors (FIIs) were net sellers of equities
worth Rs 1431.56 crore, while the mutual funds bought more shares
than they sold at a net Rs 514.26 crore on Friday, 24 October 2008,
according to provisional data on the NSE.
indices hitting day's low on frenzied selling in index pivotals,
with global cues playing the spoilsoprts. Metal, banking and IT
stocks were hammered brutally. The market breadth was dismal.
The opening volatility on the bourses followed the slump in Asian
markets to five-year lows, following the poor showing by the US
markets overnight on concerns of the looming US recession and
global economic slowdown decelerating corporate earnings growth.
Key benchmark indices in China, Hong Kong, South Korea, Taiwan, and
Japan slipped between 0.80% and 6.36% today, 27 October 2008.
At 12:29 IST, the BSE 30-share Sensex tumbled 664.78 points, or
7.53%, to 8,046.21. The Sensex opened 112.21 points lower at
8,588.86. The Sensex had lost 686.30 points to a three-year low of
8,014.77 in early afternoon trade. At the day's high of 8,739.48,
the Sensex had risen 38.41 points.
The S&P CNX Nifty lost 224.85 points, or 8.70%, to 2359.15, after
tanking to a three-year low of 2356.95.
The market breadth, indicating the overall health of the market,
was weak with 2,043 shares declining compared with just 294 that
rose. But 40 shares remained unchanged.
The total turnover on the BSE amounted to Rs 1420 crore by 12:30
IST compared with Rs 929 crore by 11:30 IST
The volatility is attributed to the expiry of the derivative
contracts for October 2008 series on Wednesday, 29 October 2008. As
per reports, marketwide rollover of positions was 37%, while that
of Nifty stood at 45% from the October 2008 series to November
2007, by Friday, 24 October 2008. The rollovers are fairly high,
indicating market players are uncertain about the direction of the
market.
Bhart Airtel was the lone gainer among the 30-member Sensex pack.
India's biggest listed cellular services provider gained 0.57% to
Rs 537.50. The stock moved in a range of Rs 552 and Rs 502.20 in
choppy trade.
Jaiprakash Associates (down 12.04% to Rs 52.40), Hindustan Unilever
(down 12.41% to Rs 197), and Reliance Communications (down 10.63%
to Rs 172.50) were the other key losers from the Sensex pack.
India's largest private sector company by market capitalization and
oil refiner Reliance Industries (RIL) fell 1.92% to Rs 996 in
volatile trade. It hit a 52-week low of Rs 980 in early trade.
RIL's net profit rose 7.4% to Rs 4122 crore on 39.8% growth in
sales to Rs 44787 crore in Q2 September 2008 over Q2 September
2007, the company said after market hours on Thursday, 23 October
2008.
Real estate shares, barring Unitech, continued their slide, with
the BSE Realty index declining 4.36% to 1,667.34. The BSE Realty
index has wiped off 87.59% from its record high of 13848.09 hit on
8 January 2008 on concern the global credit crunch would choke real
estate companies as borrowing costs rise and property prices
tumble.
DLF, holding the biggest weightage in BSE Realty index collapsed
12.90% to Rs 178. Indiabulls Real Estate (down 2.32% to Rs 94.60),
HDIL (down 12.57% to Rs 119.60), and Akruti City (down 6.64% to Rs
572) were not spared either.
Unitech, with third largest weightage in the BSE Realty index,
jumped 29.24% to Rs 38.90 after the company filed a complaint with
the market regulator against some brokers for hammering its shares
51% on 24 October 2008.
Metal shares slumped on fears a recession in the US will lead to
slowdown in demand. Tata Steel (down 9.09% to Rs 162), Nalco (down
21.75% to Rs 125.35), and Sterlite Industries (down 8.32% to Rs
191.30), and Hindalco Industries (down 9% to Rs 39.45) lead a 8.03%
decline to 4,041.04 in the BSE Metal index.
IT stocks fell despite the Indian rupee extending its losses to the
ninth day in a row today, easing 11 paise to 50.06 against the US
currency. IT firms derive a lion's share of their revenues from
exports to the US, and a declining rupee augurs well for them. But
many IT companies have taken forward cover for their foreign
exchange receipts in the belief the rupee would keep on
appreciating. Thus, the gains due to the rupee's depreciation would
be neutralised by hedging losses.
India's fourth largest IT exporter by sales Wipro tumbled 14.52% to
Rs 201 and was the top loser from the Sensex pack.
India's largest IT exporter by sales TCS fell 6.98% to Rs 456. TCS'
net profit fell 2.57% to Rs 1173.04 on a 9.36% rise in sales to Rs
5699.96 in Q2 September 2008 over Q1 June 2008. The company
announced the results on 23 October 2008.
India's third largest IT exporter by sales Satyam Computer Services
slipped 5.11% to Rs 272.20. The company raised its earnings
guidance in rupee terms at the time of announcing Q2 September 2008
results on Friday, 17 October 2008.
India's second largest IT exporter by sales Infosys was down 4.70%
to Rs 1190.
India's second largest power generation company in terms of net
profit Tata Power Company slumped 12.77% to Rs 545.10 ahead of its
Q2 results today, 27 October 2008.
Banking shares extended the losses of Friday, 24 October 2008 as
disappointed investors dumped banking shares after the central
bank's mid-term monetary policy review did not announce any
measures to boost liquidity.
On Friday, 24 October 2008, the Reseve Bank of India (RBI) kept all
the key rates unchanged even as it lowered its 2008-09 growth
forecast to 7.5% to 8% from a previous forecast of around 8%. The
RBI also left the cash reserve ratio, the amount of funds that
banks have to keep on deposit with it, unchanged at 6.5%.
India's second largest bank by market capitalisation HDFC Bank lost
7.98% to Rs 895. India's second largest private sector bank by
market capitalisation ICICI Bank slipped 4.65% to Rs 295.60 ahead
of its Q2 September 2008 results today, 27 October 2008. In the
midst of a credit turmoil gripping economies across the world,
marketmen will focus on ICICI Bank's result for its exposure to
some of the crisis-ridden institutions in the US including Lehman
Brothers Holdings Inc.
India's largest state-run bank by net profit State Bank of India
(SBI) fell 12.48% to Rs 1012.05 on muted growth in consolidated net
profit in Q2 September 2008. In its results declared before market
hours today, 27 October 2008, SBI reported a 10.60% rise in
consolidated net profit to Rs 2378.19 crore on a 26.4% increase in
total income to Rs 27083.47 crore in Q2 September 2008 over Q2
September 2007. The consolidated earnings include numbers from
recently acquired State Bank of Saurashtra.
Jet Airways (India) tumbled 13.16% to Rs 148.80 after reporting its
biggest quarterly loss in more than three years on soaring fuel
expenses. The company declared the results on 25 October 2008,
reporting a net loss of Rs 384.53 crore in Q2 September 2008 as
against a net profit of Rs 28.36 crore in Q2 September 2007. Sales
rose 71.6% to Rs 3121.34 crore in Q2 September 2008 over Q2
September 2007.
Brigade Enterprises tumbled 16.07% to Rs 38.40 despite seeing an
intra-day spike to Rs 45 with 20.26 lakh shares changing hands at
that level in a bulk deal on BSE at 11:31 IST.
PSU oil marketing companies HPCL (down 8.57% to Rs 173.35), BPCL
(down 11.51% to Rs 249.05), and IOC (down 7.26% to Rs 317) in a
weak overall market, despite the US light crude for December 2008
delivery sliding 22 cents to $63.93 a barrel today, 27 October
2008. It also touched a 17-month low of $63.67 as an emergency
production cut by OPEC was shrugged off by traders anxious about
the onset of a deep global recession.
India Inc.'s report card for the September 2008 quarter so far
shows a muted bottomline growth, partly due to a surge in interest
cost. Aggregate results of 875 companies showed a 6.2% rise in net
profit on 28.5% increase in net sales in Q2 September 2008 over Q2
September 2007. Interest cost jumped 35.6% in Q2 September 2008
over Q2 September 2007.
While governments and central banks across the globe are expected
to take further dramatic action to prop up the global financial
system this week, there is concern this would not be enough to
prevent companies from slashing production and jobs as sales get
hit and financing remains difficult.
Central banks are likely to launch new coordinated emergency action
this week to calm panic in financial markets. Reports indicate the
US Federal Reserve is widely expected to announce a 50 basis-point
cut in overnight rates on Wednesday, 29 October 2008 that would
take them to 1%, the lowest level since June 2004, with some
expecting an even deeper reduction to 0.75%.
The US markets had declined in volatile trade on Friday, 24 October
2008, as fears of a full-blown global recession intensified and
investors dumped risky assets. The Dow Jones Industrial Average
plunged 312.30 points, or 3.59%, to 8,378.95. The S&P 500 index
slipped 31.34 points, or 3.45%, to 876.77, and the Nasdaq Composite
index lost 51.88 points, or 3.23%, to 1,552.03.
Back home, markets suffered a severe setback on Friday 24 October
2008, plunging to three-year lows mirroring weak global equities on
worries about a sharp global economic slowdown and disappointment
from the second quarter monetary policy review of the Reserve Bank
of India. The BSE 30-share Sensex plunged 1070.63 points, or
10.96%, to 8,701.07, recording its biggest fall in percentage terms
since May 2004 and the S&P CNX Nifty was down 359.50 points or
12.2% to 2,584.
Foreign institutional investors (FIIs) were net sellers of equities
worth Rs 1431.56 crore, while the mutual funds bought more shares
than they sold at a net Rs 514.26 crore on Friday, 24 October 2008,
according to provisional data on the NSE.
Pre Market Report 27/10/2008
Key benchmark indices are likely to open lower mirroring weak global cues. Global stocks tumbled to a new five-year low as investors withdrew from equity markets on worries that global economic slowdown may hurt corporate profitability.
Volatility is likely to remain high as derivative contracts for October 2008 series expire on Wednesday, 29 October 2008. As per reports, marketwide rollover of positions was 37% while that of Nifty stood at 45% from October 2008 series to November 2007, by Friday, 24 October 2008.
India Inc.'s report card for the September 2008 quarter so far shows a muted bottomline growth, partly due to a surge in interest cost. Aggregate results of 875 companies showed a 6.2% rise in net profit on 28.5% increase in net sales in Q2 September 2008 over Q2 September 2007. Interest cost jumped 35.6% in Q2 September 2008 over Q2 September 2007.
In the midst of a credit turmoil gripping economies across the world, the markets will keenly watch the second quarter earnings of the country's two largest lenders State Bank of India (SBI) and ICICI Bank due today, 27 October 2008. The focus is on ICICI Bank for its exposure to some of the crisis-ridden institutions in the US including Lehman Brothers Holdings Inc. SBI's results will also be watched, as being the largest lender of the country it would serve a benchmark indicator for the entire sector. If the repeated assurances from the management of the two banks that they were on a sound footing and the impact of global crisis was negligible come true, it could turn out to be a major trigger for the beaten-down domestic bourses, which are keenly waiting for any positive cues.
While governments and central banks across the globe are expected to take further dramatic action to prop up the global financial system this week, there is concern it will not be enough to prevent companies from slashing production and jobs as sales get hit and financing remains difficult.
Central banks are likely to launch new coordinated emergency action this week to calm panic in financial markets. Reports indicate the US Federal Reserve is widely expected to announce a 50 basis-point cut in overnight rates on Wednesday, 29 October 2008 that would take them to 1%, the lowest level since June 2004, with some expecting an even deeper reduction to 0.75%.
Most Asian markets were trading lower today, 27 October 2008. China's Shanghai Composite was down 2.84% or 52.22 points at 1,787.39, Hong Kong's Hang Seng plunged 1.83% or 231.46 points at 12,386.92, South Korea's Seoul Composite slipped 1.49% or 13.95 points at 924.8, and Taiwan's Taiwan Weighted tumbled 5.24% or 239.78 points at 4,339.84. However, Japan's Nikkei was up 0.40% or 30.42 points at 7,679.50.
US markets declined in volatile trade on Friday, 24 October 2008 as fears of a full-blown global recession intensified and investors dumped risky assets. Dow plunged 312.30 points, or 3.59%, to 8,378.95. The S&P 500 index slipped 31.34 points, or 3.45%, to 876.77, and the Nasdaq Composite index lost 51.88 points, or 3.23%, to 1,552.03.
Back home, markets suffered severe setback on Friday 24 October 2008 plunging to three year lows mirroring weak global equities on worries about a sharp global economic slowdown and disappointment from the second quarter monetary policy review of the Reserve Bank of India. The BSE 30-share Sensex plunged 1070.63 points or 10.96% to 8,701.07, recording its biggest fall in percentage terms since May 2004 and the S&P CNX Nifty was down 359.50 points or 12.2% to 2,584.
Foreign institutional investors (FIIs) were net sellers worth Rs 1431.56 crore while mutual funds bought shares worth Rs 514.26 crore on Friday, 24 October 2008, according to provisional data on NSE.
US light crude for December 2008 delivery fell 22 cents to $63.93 a barrel today, 27 October 2008 after touching a 17-month low of $63.67 as an emergency production cut by OPEC was shrugged off by traders anxious about the onset of a deep global recession
Volatility is likely to remain high as derivative contracts for October 2008 series expire on Wednesday, 29 October 2008. As per reports, marketwide rollover of positions was 37% while that of Nifty stood at 45% from October 2008 series to November 2007, by Friday, 24 October 2008.
India Inc.'s report card for the September 2008 quarter so far shows a muted bottomline growth, partly due to a surge in interest cost. Aggregate results of 875 companies showed a 6.2% rise in net profit on 28.5% increase in net sales in Q2 September 2008 over Q2 September 2007. Interest cost jumped 35.6% in Q2 September 2008 over Q2 September 2007.
In the midst of a credit turmoil gripping economies across the world, the markets will keenly watch the second quarter earnings of the country's two largest lenders State Bank of India (SBI) and ICICI Bank due today, 27 October 2008. The focus is on ICICI Bank for its exposure to some of the crisis-ridden institutions in the US including Lehman Brothers Holdings Inc. SBI's results will also be watched, as being the largest lender of the country it would serve a benchmark indicator for the entire sector. If the repeated assurances from the management of the two banks that they were on a sound footing and the impact of global crisis was negligible come true, it could turn out to be a major trigger for the beaten-down domestic bourses, which are keenly waiting for any positive cues.
While governments and central banks across the globe are expected to take further dramatic action to prop up the global financial system this week, there is concern it will not be enough to prevent companies from slashing production and jobs as sales get hit and financing remains difficult.
Central banks are likely to launch new coordinated emergency action this week to calm panic in financial markets. Reports indicate the US Federal Reserve is widely expected to announce a 50 basis-point cut in overnight rates on Wednesday, 29 October 2008 that would take them to 1%, the lowest level since June 2004, with some expecting an even deeper reduction to 0.75%.
Most Asian markets were trading lower today, 27 October 2008. China's Shanghai Composite was down 2.84% or 52.22 points at 1,787.39, Hong Kong's Hang Seng plunged 1.83% or 231.46 points at 12,386.92, South Korea's Seoul Composite slipped 1.49% or 13.95 points at 924.8, and Taiwan's Taiwan Weighted tumbled 5.24% or 239.78 points at 4,339.84. However, Japan's Nikkei was up 0.40% or 30.42 points at 7,679.50.
US markets declined in volatile trade on Friday, 24 October 2008 as fears of a full-blown global recession intensified and investors dumped risky assets. Dow plunged 312.30 points, or 3.59%, to 8,378.95. The S&P 500 index slipped 31.34 points, or 3.45%, to 876.77, and the Nasdaq Composite index lost 51.88 points, or 3.23%, to 1,552.03.
Back home, markets suffered severe setback on Friday 24 October 2008 plunging to three year lows mirroring weak global equities on worries about a sharp global economic slowdown and disappointment from the second quarter monetary policy review of the Reserve Bank of India. The BSE 30-share Sensex plunged 1070.63 points or 10.96% to 8,701.07, recording its biggest fall in percentage terms since May 2004 and the S&P CNX Nifty was down 359.50 points or 12.2% to 2,584.
Foreign institutional investors (FIIs) were net sellers worth Rs 1431.56 crore while mutual funds bought shares worth Rs 514.26 crore on Friday, 24 October 2008, according to provisional data on NSE.
US light crude for December 2008 delivery fell 22 cents to $63.93 a barrel today, 27 October 2008 after touching a 17-month low of $63.67 as an emergency production cut by OPEC was shrugged off by traders anxious about the onset of a deep global recession
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