Indian stock market morning report by Keynote Capitals (October 24, 2008, Friday, 7.00 a.m. GMT)
Economic and Corporate Developments
- The rupee opened trade this morning at a record low of 50.15 per USD, following sharp decline in Asian stock markets.
- Crude oil prices are close to the $67 per barrel mark.
- The petroleum minister has said that India is watching the price of crude oil and will make an announcement in a week on revising fuel prices. He said last week that the fuel prices may be cut if the average price of crude oil processed by Indian refineries falls to $61 a barrel. The price of the Indian basket of crude oil fell to $61.47 a barrel on Wednesday.
- The inflation figure for the week ended October 11, 2008 was 11.07%, vis-a-vis 11.44% for the previous week.
- According to the Finance Minister, there is adequate liquidity in the banking system. He has advised banks to lend aggressively.
- The Reserve Bank of India is considering options to make cheaper finance available to NBFCs, including a separate line of credit for bank finance backed by government securities or AAA-rated commercial paper.
- Retail loans growth in India further slow downed at the end of August 2008 as home loans, the major contributor, saw a substantial decline. The growth slowed to 17.4% in August 2008 from 21.4% a year earlier.
- Reliance Industries has denied that Chevron has offered it the latter’s 5% stake in Reliance Petroleum. Chevron acquired the stake in 2006 for $300mn and has an option to increase it to 29%
- Apollo Tyres is considering a price increase of 3-4% in the December quarter, to protect its margins.
- Dell, the world's No.2 computer maker, expects softness in demand for PCs due to the global economic downturn, but hopes to increase market share in emerging markets such as India.
Results to be announced today
ABB, Aditya Birla Nuvo, Alstom Projects, Ambuja Cements, Asian Paints, Bharat Electronics, BHEL, Binani Industries, BPL, Colgate, CRISIL, Dish TV, Dishman Pharma, Electrotherm, Emkay, Great Offshore, Glaxo, Godrej Consumer Products, Lupin, Hexaware, HCC, HUL, ITC, Moser Baer, NTPC, Tata Steel, TV 18.
US markets overnight
The US markets managed to end up 2% in late trade. Former Federal Reserve Chairman Greenspan has called for tighter regulation of financial sector to prevent a repeat of credit crisis. Credit Suisse posted 3Q net loss of 1.26bn Swiss francs ($1.08bn) compared to profit of 1.3bn francs a year ago, after writing down value of leveraged loans and mortgage-backed securities. However, Credit Suisse declined to join UBS in seeking government assistance last week, and instead raised 10bn francs from investors in Qatar, Israel and Saudi Arabia to show the bank can weather the financial crisis alone. Sony cut its full-year net income forecast by 38% because of yen's strength against euro. Slower growth expectations also have led many companies to cut jobs. Last week's jobless claims were higher than expected. Goldman Sachs plans to cut 3,200 jobs (10% of its workforce) adding to 125,000 job cuts across the securities industry this year. Xerox and General Motors will also be cutting their workforces. Goldman Sachs, Coller Capital and Lexington Partners are weighing bids for Lehman Brothers investments in US and European private-equity funds. Crude is down at $67.64/barrel, which is over 50% down from its July high as slower economic growth threatens to undercut demand for the commodity. With oil prices down so dramatically, OPEC is expected to announce production cuts at its emergency meeting tomorrow.
Views on markets today
With the Asian markets sliding further down this morning, today is all set to be another day for the bears. The Nikkei is down 600 points, dropping below the 8,000 level for the first time since May 2003. The Kospi fell below the 1000 level a level witnessed for the first time since June 2005.
Back home, there is no stopping the bad news. While the Finance Minister confirmed the slowdown in the economy, he also expressed concerns about the increasing deficits. As per the Minister, India may not achieve its revenue and fiscal deficit targets. Corporate earnings growth is seen subdued. While Reliance Industries reported flattish earnings growth, some major corporates saw a huge dip in earnings. Reliance Industries’ profits went up by 7.4%. Though the earnings growth is above estimates, it took a major hit on margins. Grasim, Bajaj Auto, and Dr. Reddy's Laboratories saw a major fall in quarterly earnings. Apart from global factors, a few major companies will announce their results which include ABB, Tata Steel, Maruti Udyog, ITC, Ambuja Cements and Lupin. We may see volatility with weakness in the Indian markets today.
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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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