Indian stock market morning report by Keynote Capitals (October 22, 2008, Wednesday, 7.00 a.m. GMT)
Economic and Corporate Developments
- The rupee weakened past 49.30 per USD to a record low of 49.34/50 this morning on expectations of further outflows from local stock market. It had closed at 49.04/06 yesterday.
- Crude oil prices are at $70.07 per barrel, down about 2%.
- The Government and the RBI are looking at further easing of ECB guidelines and FDI norms to enhance overseas fund inflows. On ECBs, the option of putting loans up to $500mn for rupee expenditure by Indian infrastructure companies under the automatic approval route is being considered.
- The steel ministry may provide protection to domestic steel companies by levying a 10% import duty on all grades of steel. It is also likely to suggest re-imposition of 14% countervailing duty (CVD) on bars and structurals (primarily Tor steel) and reduction in excise duty on Tor steel and galvanised products from the present 14% to 8%.
- According to media reports, Norway’s sovereign wealth fund, the world’s second largest, is likely to invest $2bn in Indian stocks upto January 2009. This comes in the wake of net sales by FIIs of about $11bn worth of equity in 2008 YTD.
- As per our sources in the banking industry, some banks have decided to stop fresh disbursements to the cement, steel and real estate sectors, anticipating a major slowdown, and fears of NPAs from these sectors by March 2009.
- In spite of the economic slowdown, India’s cellular telephony sector continues to grow. India added 10mn mobile phone subscribers in September, taking the total subscriber base to 310mn.
- Wipro’s net profit for Q2 grew just 1.2%, missing forecasts. While Wipro has not seen any project cancellations so far, decision making by clients is getting delayed. However, the deal pipeline still looks good, as per the management.
- Hindalco Industries may sell stakes in group companies to raise funds to repay a part of the $3bn bridge loan it obtained to buy Novelis.
- BHEL has bagged an order worth Rs6.4bn for setting up a 412Mw hydro-electric project in Himachal Pradesh.
- According to press reports, ITC is understood to have accumulated losses of Rs700Cr over the past seven years in its food business. The segment which crossed Rs1,000Cr revenue mark in the last financial year, is reportedly losing on an average, Rs60Cr per year.
Results to be announced today
Bajaj Auto, TCS, Wipro, Reliance Infrastructure, Educomp Solutions, Jindal Saw, Cipla, Bank of India, Yes Bank, Sesa Goa, IDFC, 3i Infotech, Neyveli Lignite, Hotel Leela Venture, McDowell Holdings
US markets yesterday
The US markets declined 2.5% with several companies posting quarterly earnings misses and cautious outlook overshadowing signs of improvement in the credit markets. The new plan of the government to boost money market funds and gloomy corporate outlooks kept investors on the edge. Financials closed down 1.8%. Earnings were mixed; of the 77 companies that reported earnings, 52% topped estimates, 35% missed and 13% were inline. Outlooks were cautious of the 49 companies that issued guidance, 45% were negative, 30% were in-line, 21% were mixed and only 3% were positive. In stock specific earnings action, Apple beat market forecasts but gave a weak outlook. Yahoo’s Q3 profit declined 64% and it announced layoffs of 1500 workers and lowered its revenue forecast. Citibank being downgraded and word from billionaire Kurt Kerkorian that he is dumping Ford shares added to downside in the markets.
Views on markets today
A strengthened Yen brought the Japanese markets down this morning. Overnight fall of the US markets also led to negative sentiments in Asian markets. Fears of global recession are mounting. We expect Indian markets to perform in line with their global counterparts and remain negative today. Apart from the weak global cues we may see a profit booking in heavyweight stocks. Domestic institutions have been in the buying mode over the last two days. We expect markets to remain in a cautious state till the announcement of RBI's monetary policy on October 24. We may see a weakness in the Wipro stock. The company issued cautious near term outlook because of deteriorating economic conditions. Tech Mahindra may see some action after its 56% growth in the bottom line. A few major companies are announcing results today which will also drive the market movement. We note that speculative activity in top traded stocks seems to have shifted to the BSE from the NSE. Aggregate deliverable volumes for top 10 stocks (in terms of value of turnover) stood at just 12.6% on the BSE, vis-a-vis 25.4% on the NSE.
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Indian stock market daily morning report (February 09, 2010, Tuesday)
The Sensex bounced back from the early slide yesterday, closing with marginal gains. The Government’s forecast that the economy would grow by 7.2% this fiscal year, reinforcing expectations of strong industrial growth, along with positive European markets helped markets recover. Most of the buying was seen in capital goods, banking and real estate stocks, whereas metal and auto stocks witnessed selling pressure. Market breadth was marginally weak at around 0.92x. FIIs sold equities worth Rs9.35bn, while domestic institutions bought equities of Rs3.8bn.
Indian stock market and companies daily report (February 09, 2010, Tuesday)
The benchmark indices logged marginal gains after swinging sharply in highly volatile trade. IT stocks played the lead role in the recovery; however, metal pivotals remained subdued, as metal prices fell on the LMEX. Telecom stocks advanced on bargain hunting. Rate-sensitive banking shares recovered from the day's low, while auto stocks were mixed. The BSE Sensex and the NSE Nifty rose by a marginal 0.1% each. The BSE Mid-cap and Small-cap indices were down by 0.1% each. Among the front-liners, Bharti Airtel, RCOM, ONGC, HLL and M&M were up by 2-3%, while Tata Steel, Hindalco, Wipro, Jaiprakash Associates and NTPC were down by 1-4%. In the mid-cap segment Chambal Fertilisers, Nagarjuna Fertilisers, Core Projects, Kansai Nerolac, Procter & Gamble were up by 5-7%, while Indraprashtha Gas, Gujarat NRE Coke, Torrent Pharma, Spice Communications and REI Agro, were down by 4-9%
Indian stock market daily morning report (February 08, 2010, Monday)
The Sensex continued its downward trend last Friday, closing below the 16,000 mark on concern over Europe's sovereign debt, indications of weak US jobs data and a fall in commodity and energy prices. Persistent selling pressure was seen across the board and all sectoral indices closed negative with real estate, metals and capital goods stocks were the worst affected. Auto stock also declined after a government-appointed panel recommended additional duty on diesel-powered vehicles. Indian markets were open for a couple of hours last Saturday, for the purpose of software testing. Market breadth was extreme weak at around 0.21x as investors sold large cap stocks. FIIs sold equities worth Rs17.2bn, while domestic institutions bought equities of Rs11.68bn.
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Godrej Properties IPO review and analysis by Angel Broking, 9 December 2009
Godrej Properties Limited (GPL) intends to develop its projects through joint development agreements with land owners. Under this asset-light model, GPL will enter into revenue, profit or area-sharing agreements with land owners, instead of an outright purchase of the land. This model avoids direct land dealings for GPL and the locking-up of extensive capital in land. Around 80% of GPL's existing land bank will be executed through joint developments with partners. The Godrej brand name has been associated with quality and strong corporate governance. Both of its existing listed entities, Godrej Consumer Products and Godrej Industries have given CAGR Returns of 48% and 77%, respectively, to investors since 2001. We believe that GPL could leverage its parentage brand (with respect to access to the land at Vikhroli and a strong customer preference towards it), assuring a timely delivery of execution. More than 50% of GPL's existing land bank is exposed towards township projects and in one location (Ahmedabad), which will be executed over the next ten years. Any delay in this execution or a fall in property prices in Ahmedabad will impact our NAV estimates, as 50% of our NAV is derived from this project.
JSW Energy Ltd IPO review and analysis by Nirmal Bang, 8 December 2009
JSW Energy Ltd. (JSWEL) is a power project development company, which is developing, and will operate and maintain, power projects in India. The company has two thermal power projects under operation, with a combined installed capacity of 860 MW. JSWEL is a part of the JSW Group, a leading business group in India. JSW Group has a presence in high growth sector like Steel, Energy, Aluminium, Cement, Infrastructure and Logistics. Post IPO holding of Promoter and Promoter Group would be 78.12%
JSW Energy IPO review and analysis by Angel Broking, 7 December 2009
JSW Energy (JSWEL) currently has operational capacity of 995MW and is in the process of executing projects with capacity of 2,655MW. In addition, the company has 7,740MW power generation projects at an early stage of development. A major portion (2,145MW) of JSWEL’s upcoming capacities is expected to be operational by FY2011E thereby providing near-term visibility. Out of the plants under construction, the company expects to commission 570MW by end FY2010E, while another 1,575MW is expected to get operational in FY2011E. Thus, a robust portfolio and near-term Revenue visibility is a major positive for the company.
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Indian auto sector monthly update (January 2010), 5 February 2010
Indian Banking Report January-February 2010, 4 February 2010
Indian telecom monthly update (December 2009), 3 February 2010
Third quarter review of Indian monetary policy 2009-10, 1 February 2010
Indian Banking fortnightly report (January 2010), 18 January 2010
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