Values in Rs. Crore; * provisional data
MARKET VIEW – Weekly News Letter (07-11-2011 to 13-11-2011)
The Key benchmark Indices edged lower on Friday
(11-11-2011) after disappointing IIP data which pull down the Nifty
below 5200 level mark. The
Banking sector was the top loser with a 3% loss as Moody’s
downgraded the Indian Banks to negative from stable on concern over
profitability, asset quality and Capital concern.
Weakening of Rupee, Rising Crude prices and Euro Zone problem
further dampened the sentiment.
The BSE Sensex lost 169.28 points or 0.97% to close at
17192.82 and the Nifty lost 52.2 points or 1% to settle at 5168.85.
The Sensex / Nifty hit an intraday high/low of
17279.23/17096.84 and 5198.6/5142.25.
The BSE midcap fell 1.13% and the small cap lost 1.57%. Both
these underperformed the Sensex. The BSE recorded a turnover of
Rs.2610 crores compared to Rs.2576.35 crores he previous day. And
the total turnover was Rs.1.3 lakh crores.
The Industrial output grew at 1.9% in September as against
4.1% in August, the lowest rate of growth in two years.
The market breadth was weak as 937 shares advanced 1912
declined and 112 unchanged. The
FII’s were sellers for Rs.83.26 Crores.
The Depreciation of Rupee was another concern as Rupee fell
to a two year low of 50.42 for dollar in the early trade.
The major losers include United Spirits 8.64%, Axis Bank
4.96%, HDIL 4.56%, ICICI Bank 4.55%, Hindalco 4.31%, Tata Steel
4.19%, SBI 3.48%, L & T 3.3%, IDBI Bank 3.34%, HDFC Bank 2.83%
& ONGC 2.01%.
BSE Bankex was down 3.03% or 333.99 points at 10686.97
Bank 4.94%, SBI 3.48%, Yes Bank 2.69%, ICICI Bank 4.55%
& HDFC Bank 2.83
BSE Metal Index was down 2.33% or 268.41 points at 11270.38
Steel 3.08%, Tata Steel 4.19%, Sterlite 2.13% & Hindalco
BSE Capital Gooda Index was down 2.32% or 251.53 points at
& T 3.3%, Crompton 1.78%, Thermax 2.41% & Suzlon
BSE Realty Index was down 2.24% or 41.52 points at 1809.53
3.87%, HDIL 4.56%, DB Realty 5.24% & Sobha 1.02%
BSE Consumer Durable Index was down 1.57% or 102.03 points
3.15%, VIP 4.64%, Rajesh Exports 3.01% &Titan 1.54%
On weekly basis the market fell over 2% in truncated trading week.
The Moody’s downgrade of Indian Banking sector,
Disappointing IIP data and weak global cues dragged the Sensex by
369.79 points or 2.11% to 17192.82 and the Nifty by 115.35 points or
2.18% to 5168.85. The
BSE midcap fell 2.16% and the small cap lost 2.78%.
Both these underperformed the sensex.
However the FII’s bought share worth Rs.932.06 Crores
during the week.The market was shut on Monday on account of Bakrid
and Thursday on account of Gurunanak Jayanthi. Trading for the week
began on a flat note on Tuesday. Weak global markets pulled down the
Indian stocks on Wednesday nearly by 1.2%. The Benchmark indices
fell for the second day on Friday to a two and a half week low. The
Sensex has lot 512.19 points or 2.89% this month so far. The food
price index rose to 11.81% and the fuel price index rose 14.5% in
the year upto 29th October 2011. Auto sales number fell
24% in October, the worst in a decade. The Bank stocks suffered a
set back this week after the international rating agency Moody’s
downgraded the section from stable to negative. However the global
markets recovered on Friday due to political changes in Euro Zone.
The major weekly losers include SBI 8.5%, DLF 8.1%, Tata Steel 8%,
Hindalco 7.6%, ICICI Bank 7.2%, Ranbaxy 7.1%, Axis Bank 6.3%, Tata
Motors 3.5%, L&T 4.5% & HDIL 10.1%.
Jones 1.4% Nasdaq -0.3% Hang Seng -3.6% Nikkei -3.3% FTSE 0.3%
& Dax 1.5%
the week ahead the markets are likely to be volatile due to global
events and the direction will be driven by Euro zone development.
Increasing crude oil prices, high inflation and rupee dollar factor
are a cause for concern.
U.S. market closed positively on Friday after the Italian Senate’s
approval of economic reform. The Dow Jones was up 259.89 points or
2.19% and the NASDAQ ended higher by 53.60 points. The market will
keenly watch the WPI numbers for the month of October on Monday.
Things could worsen if Nifty/Sensex breaches below 5060/16825 level.
(The above information and
opinion is compiled from sources believed to be reliable and
provided in good faith. These are subject to change without notice.
This note is not and should not be construed to as, an offer to
sell or a solicitation of an offer to buy any securities. The author
and/or the company or its associates may or may not have positions
in the above-mentioned scrips and this may change from time to time.
Trading and investing in stock markets involve risk of financial
loss and it is recommended that you consult an investment
professional for your decisions. It is strongly recommended that
stop loss be followed to protect from undue risk. This report is
exclusively for the clients of Venkataraman & Co. only.)
Sensex dips below 17K on weak
The Bombay Stock Exchange benchmark Sensex dipped
below the 17,000 mark after three weeks, losing 236 points on
sustained selling amid concerns over weak corporate earnings and
subdued global markets.
The Sensex, which had lost over 450 points in the
previous three sessions, fell further by 236.07 points or 1.38 per
cent to 16,882.67. The gauge fell below the 17,000 level after
Similarly, the broad-based NSE index Nifty slipped
below the 5,100 mark, losing 79.85 points or 1.55 per cent to
A weak trend in the Asian region and lower opening
in Europe due to lingering doubts over the euro zone debt crisis
dampened the trading sentiment.
Brokers said below-expectation quarterly earnings by
some leading companies and fears of high inflation keeping interest
rates high remained major investor issues.
The decline was led by financial and interest rate
sensitive stocks such as realty, auto and capital goods.
Two most heaviest counters, with 20 per cent
weightage on the Sensex — Reliance Industries and Infosys — fell
sharply on brisk selling. RIL tumbled 1.42 per cent and Infosys by
0.57 per cent.
Other losers included Bajaj Auto, DLF, HeroMotorCo,
ICICI Bank, L&T, M&M, Maruti, SBI, Tata Steel and BHEL.
The realty sector index suffered the most by losing
5.22 per cent to 1,671.28, followed by capital goods index by 2.77
per cent to 10,208.85. Banking index lost 2.02 per cent to 10,436.22
and auto index by 1.65 per cent to 8,808.55.
Tata Power scrip plunges on weak
Shares of Tata Power plunged by as much as 8 per
cent in the morning trade on the bourses today after the leading
power utility posted a consolidated net loss of Rs 1,218.86 crore
for the three months ended September.
The company’s September quarter results took a
beating on account of provisioning of Rs 1,461.96 crore toward
impairment charges and forex losses related to its upcoming Mundra
The company had reported a consolidated net profit
of Rs 672.54 crore for the second quarter last fiscal.
Reacting to the numbers, the scrip opened on a weak
note and then lost 7.46 per cent to an early low of Rs 93 on the
BSE. Similarly, on the NSE, the scrip tanked 7.94 per cent to Rs
However, the stock made up some of the lost ground
in later trade and was quoting 3.98 per cent lower at Rs 96.50 on
the BSE and was down 4.69 per cent at Rs 96.60 on the NSE.
Apart from provisioning related to Mundra UMPP, Tata
Power said its profitability was hit by a differential cost of Rs
50.39 crore in connection to its 1,050-MW Maithon project.
“The 4,000-MW Mundra UMPP and the 1,050-MW Maithon
Power Project are in advanced stages of completion. We are also on
track on all our other projects, which are under implementation,”
Tata Power Managing Director, Mr Anil Sardana, said.
stock recovers after opening weak
Shares of Kingfisher Airlines tanked by as much as 4
per cent in the morning trade on the bourses today, but made a smart
recovery after the air carrier announced that its net loss more than
doubled to Rs 468.66 crore in the second quarter.
Kingfisher Airlines’ net loss widened to Rs 468.66
crore in the quarter ended September 30, 2011 from Rs 230.81 crore
in the same period last year.
Reacting to the numbers, the stock opened on a
sluggish note on the BSE and then dropped by 2.81 per cent to an
early low of Rs 20.75.
A similar movement was witnessed on the National
Stock Exchange, where the stock fell 4.20 per cent to touch an early
low of Rs 20.50 after opening at Rs 21.10.
However, the stock later made a smart recovery on
the BSE, where it was later quoted 0.23 per cent higher at Rs 21.40,
though it was still down by 0.93 cent at Rs 21.20 on the NSE.
Commenting on the share movement, Ashika Stock
Brokers Research Head, Mr Paras Bothra, said: “The results are
bad, losses are mounting and the financial position of the company
is in the doldrums. The initial jerk in the counter was a reaction
to the poor Q2 results.”
“The bad news already factored in the price and
the market is now anticipating that some sort of restructuring work
will be done and a workable solution will be carried out by the
lenders and promoters,” Mr Bothra added.
Bankers have made it clear that Kingfisher’s
promoters will have to infuse Rs 800 crore worth of fresh equity
into the company if they are to consider a second restructuring of
the existing debt, even as opposition mounted to any bailout of the
Bankers have asked the troubled airline to come out
with a “credible” plan.
The lenders — a 13-bank consortium led by SBI
which was yet to decide on ways to ease the troubled airline’s Rs
7,057.08-crore debt burden — are due to meet the Kingfisher
rises over 3% on good Q2 earnings
Drug-maker Sun Pharmaceutical Industries gained over
3 per cent on the bourses today after the company reported 19 per
cent growth in net profit to Rs 598 crore for the quarter ended
Shares of the company jumped by 3.4 per cent to Rs
521 on BSE, while on NSE, the scrip gained 3.5 per cent to Rs 522.
The scrip was also the top gainer among the Sensex
30 blue-chips in morning trade.
Sun Pharmaceutical Industries has reported 19 per
cent growth in net profit to Rs 598 crore for the quarter ended
September 30 on account of robust performance across its businesses.
In the corresponding year-ago period, the company
had posted a net profit of Rs 503.65 crore.
On a standalone basis, Sun Pharma’s net profit
increased to Rs 437.55 crore in the second quarter ended September
30 from Rs 345.72 crore in the year-ago period.
net down 15%
Concor has registered a net profit of Rs 175.42
crore for the second quarter ended September 30, 2011, down 15 per
cent against Rs 206.73 crore recorded in the same period last
This is due to provisioning of a deferred tax
liability of about Rs 48 crore during the quarter under review.
The container train operations company has
registered a 5.3 per cent growth in income from operations at Rs
994.55 crore for the second quarter of this fiscal against Rs 944.18
crore in the same period of 2010-11.
“We have provided about Rs 48 crore in the current
fiscal’s second quarter as deferred tax liability of last fiscal.
This was the differential between the minimum alternate tax (MAT)
rate with surcharges against our average tax rate,” Mr Anil Gupta,
Managing Director, Concor.
jumps over 3% on robust results
Tata Coffee shares surged over 3 per cent in the
morning trade today after the company posted 75 per cent increase in
its group consolidated net profit.
For the quarter ended September 30, 2011 the
group’s consolidated net profit reached Rs 17.59 crore against Rs
10.05 crore a year ago, up 75 per cent.
The stock that was on a downfall for three
consequent trading sessions, advanced 3.06 per cent to touch a high
of Rs 901.50 on the BSE.
On the National Stock Exchange, the stock witnessed
a similar movement and jumped 3.02 per cent to a high of Rs 901.
Tata Coffee later pared with its initial gains and
was trading at Rs 888.70, up 1.6 per cent on the BSE and at Rs
887.85, up 1.52 per cent, on the NSE.
Total sales of the integrated coffee plantation
company rose 37 per cent to Rs 410.27 crore in the second quarter of
the current fiscal against Rs 298.73 crore in the same quarter last
Mahindra Q2 net up 18.8% at Rs 432.58 cr
Private sector lender Kotak Mahindra Bank has
reported an 18.8 per cent jump in net profit to Rs 432.58 crore for
the second quarter ended September 30, 2011.
The bank had posted a net profit of Rs 364.11 crore
in the July-September quarter of 2010.
Total income of the bank during the quarter fell to
Rs 2,740.84 crore from Rs 2,947.21 crore, Kotak Mahindra said in a
filing to the BSE.
During the first six months of the current fiscal,
the bank’s net profit rose by 22.68 per cent to Rs 848.68 crore
from Rs 691.80 crore in the same period last fiscal, it said.
The total income of the bank during the
April-September period rose to Rs 5,450.48 crore from Rs 5,275.88
crore in the same period of 2010, it added.
Shares of Kotak Mahindra Bank closed 5.25 per cent
higher at Rs 494.85 on the BSE.
Q2 profit up 11% at Rs 1,906 cr
IT bellwether Infosys Technologies came up with no
major surprises in its second quarter results for the fiscal with
its net profit posting a 10.7 per cent increase on a sequential
basis to Rs 1,906 crore on revenues of Rs 8,099 crore which grew 8.2
per cent for the same period.
Stating that the global macroeconomic environment
was still a concern for the IT sector, Infosys Chief Executive
Officer and Managing Director, Mr S.D. Shibu Lal, said clients are
looking for new opportunities for growth and increased returns on
The Infosys stock reacted positively with the price
rising by Rs 150 (6 per cent) to Rs 2,655 in the early morning
“Our strategic initiatives and organisation
structure will enable us to build long-term partnerships with our
clients and help them drive their business objectives.’’
Infosys, which gives quarterly guidance for its
topline, said for the third quarter, revenues are expected to be in
the range of Rs 8,826 crore and Rs 9,012 crore, which is a
year-on-year growth of 24.2 per cent to 26.8 per cent. Earnings per
share is expected to be in the range of Rs 38.51 and Rs 39.20 with a
year-on-year growth of 23.6 per cent and 25.8 per cent.
For the entire fiscal, revenues are expected to be
in the range of Rs 33,501 crore and Rs 34,088 crore with YoY growth
of 21.8 per cent to 24 per cent and earnings per share is expected
to be in the range of Rs 143.02 and Rs 145.26 registering a
year-on-year growth of 19.7 per cent and 21.6 per cent.
The company said for the second quarter it added
15,352 (gross) and 8,262 (net) employees with a total employee
strength of 1,41,822. It added 45 clients during the quarter.
Infosys said that it will add 8,000 more employees
in the next quarter.
Gold futures jumps
to Rs 27,087 on global cues
Gold prices gained Rs 88 to Rs 27,087 per ten grams
at the futures trade today as speculators indulged in creating fresh
positions on the back of a firm global trend.
At the Multi Commodity Exchange, gold for February
delivery gained Rs 88 or 0.33 per cent to Rs 27,087 per ten grams
after touching a high of Rs 27,128 in a business turnover of 52
Similarly, the metal for delivery in December edged
up by Rs 85 or 0.32 per cent to Rs 26,811 per ten grams in a
business volume of 2,989 lots.
Analysts said fresh positions built up by
speculators in tandem with a firm global trend as concerns about
Europe’s debt woes and festival season demand at home spurred the
demand for the precious metal, influencing gold prices at the
futures trade here.
Meanwhile, the yellow metal gained $2.10 or 0.13 per
cent to $1,655.40 an ounce in the Asian region.
futures climbs to Rs 4,597
Crude oil futures prices were up by Rs 49 to Rs
4,597 per barrel today on increased buying by speculators triggered
by a firming global trend.
Trading sentiment remained better after crude oil
rose to the highest in almost 12 weeks in New York as investors bet
that signs of economic growth indicate fuel demand will increase.
At the Multi Commodity Exchange, crude oil for
delivery in November month rose Rs 49 or 1.12 per cent to Rs 4,597
per barrel with a business turnover of 46,985 lots.
Similarly, the oil for delivery in December moved up
by Rs 45 or 0.99 per cent to Rs 4,605 per barrel with a trade volume
of 4,466 lots.
Traders said that the rise in crude oil futures was
due to a rising global trend and increased buying by speculators.
Meanwhile, crude oil gained 80 cents to $92.07 a
barrel on the New York Mercantile Exchange.
trend in soya oil futures market
Soyabean arrivals in State mandis declined in the
past few days to 1 lakh bags from 5 lakh on expectation of higher
prices. Many mandis remained closed on Monday for Dhanteras.
Soyabean sold at Rs 2,080-2,150 a quintal on average
in the mandis. In Indore mandis, soyabean was quoted at Rs
2,070-2,140, with about 8,000 bags being offloaded in local mandis.
Mandis in Ujjain, Dewas and Barnagar remained closed ahead of
Diwali. With a marginal improvement in foreign markets, soyabean
futures on the National Commodity and Derivatives Exchange (NCDEX)
rose, with the November contract closing Rs 4.50 higher at Rs
2,204.50 a quintal. The December contract, on the other hand, lost
Rs 4 at Rs 2,231 a quintal on the exchange because of weak buying
Plant deliveries of soyabean sold at Rs 2,180-2,220
a quintal. According to trade sources, soyabean prices are unlikely
to witness a bearish sentiment in near future as there is enough
ready demand. Soya de-oiled cake gained marginally on improved
demand, quoting at Rs 17,300 a quintal in the Kandla port against Rs
15,800 in the local market.
Soya oil rose a little on improved demand in the
local market ahead of Diwali. In the ready market soya refined sodl
at Rs 610-611 for 10 kg, while it fetched Rs 605-607 for 10 kg in
the forward market. Soya refined for November delivery on the
National Board of Trade closed Rs 1.40 up at Rs 617 for 10 kg (Rs
612-614.10). On the NCEDX, soya oil for November delivery was up Rs
1.20 at Rs 616.30, while for December declined by Rs 3.05 at Rs
614.95 on weak buying support.
Courtesy: Business Line
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