Indian stock market morning report by Keynote Capitals (November 17, 2008, Monday, 7.00 a.m. GMT)
Economic and Corporate Developments
- The rupee has begun the week on a weak note this morning, opening at 49.15 per USD, slightly lower than
Friday's close of 49.01/03.
- KV Kamath, CEO, ICICI Bank, has said that lenders are expected to make available more credit in the coming
days on the back of the likely reduction in interest rates.
- IT sector update:
- Nandan Nilekani of Infosys Technologies has said that the growth of the tech sector would see a
slowdown. However, the IT industry will deal with challenges and will continue to grow and recruit.
- Three of India’s top five IT service providers, viz., Infosys Technologies, Wipro and HCL Technologies,
have posted a y-o-y as well as sequential rise in the proportion of fixed price contracts for the September
quarter. Fixed price contracts allow for higher efficiencies and can lead to margin management.
- Mastek is in the process of closing down its BPO practice.
- Our research team has released a note “Steel - still not a steal?”. The note attempts to assess the extent of
correction in steel prices. Steel, an essential commodity, has been severely impacted by the global economic
slowdown. Demand erosion has resulted in steel prices falling by about 46% off the peak in June 2008. In
order to maintain prices, steel manufacturers have announced production cuts and have deferred expansion
plans. China, which produces over 1/3rd of world crude steel, will continue to determine global steel prices.
Steel prices are likely to be decline further.
- Inflationary pressures and lower import duties have boosted import of tyres from China, whose share in total
imports is expected to rise to 82% this year from just 29% 7 years ago. Due to the onslaught, Indian tyre
makers including MRF, JK Tyres, Apollo and Ceat have lost shares in domestic market to cheap Chinese tyres.
- Apollo Tyres plans Rs. 3,000 crore investments in the next five years to set up Greenfield plans in India and
abroad as well as to expand its existing facilities, with target turnover of $4 billion.
- Tata Chemicals is planning massive expansion near its Chemical Complex in Gujarat for an investment of Rs
700-1000 crore.
US markets last Friday
Decrease in retail sales, weaker demand for mobile phones and continued concerns about the depth of the
recession led US markets to end down 3.8%. Weak economic conditions have retailers worrying over the holiday
shopping season. The gloomy outlook mirrors a 2.8% decline in October retail sales. Excluding autos, retail sales
declined 2.2%. Both were worse than expected. Sears Holdings, Home Depot and Office Depot declined more than
7.6%. The downbeat retail sales data set a weak foundation for the Personal Consumption Expenditures (PCE)
component of 4Q GDP. Moreover, the data validates the belief that 4Q GDP will be well below the original estimate
of a 0.3% decline reported for 3Q. Leading handset company Nokia stated it expects 4Q industry volume to decline.
The firm sees softer consumer spending amid weak economic conditions, while trade partners are challenged by
credit conditions. Qualcomm, the biggest maker of mobile phone chips dipped 5.4% and Motorola dipped 11% after
Nokia predicted global shipments will shrink next year.
Views on markets today
- Japan is in a recession. Q3CY08 GDP shrank by 0.4%, first time since 2001. The Nikkei has recovered after a
weak opening. Other Asian indices are positive today.
- Indian markets were volatile for last two trading sessions. On Friday, the Sensex closed down 1.6%. However,
both the NSE and BSE saw good delivery based volumes. However, overall volumes remain low.
- The Finance Minister has said that the global crisis would impact India for 6-9 months. He expects a slowdown
in all the sectors. About G-20 meet, he said that there was a broad agreement on common accounting
standards among countries.
- Stocks in news today:
- Kingfisher Airlines plans to sell 25% stake, in talks with British Airways, Singapore Airline and Virgin.
- Tata Chemicals buying 600 acres land in Gujarat for Rs700-1000crore for soda ash expansion.
- Great Offshore promoters at risk of losing control as lenders putting pressure to meet the shortfall
(Promoters had pledged shares at Rs 850 and is currently trading at Rs300/share).
- GVK, GMR seek to raise airport fees by 10% as traffic falls.
- Star TV acquires minority stake in Jupiter Entertainment (major competitor of Sun TV in South India).
- We may see volatility today with negative biased trading.
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| Latest Indian Stock Market Reports |
Indian stock market daily morning report (March 12, 2010, Friday)
Recovery in IT and bank stocks helped the Sensex close positive yesterday. Profit taking was witnessed in auto stocks which capped the gains. Market breadth was weak near about 0.6x. Asian markets are mixed today. While the Nikkei is up, the Hang Seng is trading with a moderate decline.
Indian stock market daily morning report (March 11, 2010, Thursday)
Indian markets corrected midway through the trading session yesterday on profit taking in technology stocks. However, a recovery in oil and gas and real estate stocks helped the Sensex to close marginally up. Market breadth was weak at around 0.7x. While FIIs bought equities worth Rs3.6bn and domestic institutions sold equities of Rs3.7bn. Asian markets are trading mixed today, with the Nikkei up and the Hang Seng down. SGX Nifty is trading with a moderate decline.
Indian stock market and companies daily report (March 11, 2010, Thursday)
The benchmark indices posted small gains as European markets reversed early losses and US index futures rose. The market breadth was weak after a strong start. Auto stocks edged higher on fresh buying. Banking shares were mixed. Telecom pivotals saw a divergent trend, but IT stocks declined on profit taking following recent gains triggered by upbeat US jobs data. The Sensex and the Nifty closed in the green, with gains of 0.3% each. The BSE Mid-cap and Smallcap indices underperformed the benchmark indices and closed with losses of 0.1% and 0.2%, respectively. Among the front-liners, Hero Honda, ACC, RIL, JP Associates and HDFC were up by 1-3%, while NTPC, Maruti Suzuki, Bharti Airtel, Infosys and Sun Pharma were down by 1%. In the Mid-Cap segment, M&M Financial Services, Asian Star, Amtek Auto, BF Utilities and Indusind Bank were up by 5-8%, while Balrampur Chini, Triveni Engineering, Bajaj Hindusthan, Shree Renuka Sugars and Nagarjuna Fertilizers were down by 4-8%.
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| Indian Stocks Recommendations |
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.
| | Indian News |
Indian Union Budget review 2010-2011, 6 March 2010
Indian Auto Sector Update, 6 March 2010
Indian Economic Survey 2010, 25 February 2010
Indian railway budget 2010 analysis, 24 February 2010
Indian auto sector monthly update (January 2010), 5 February 2010
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