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Indian stock market and companies daily report (February 09, 2010, Tuesday)

Contributed by Angel Broking

By Angel Broking

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%.

Markets Today

The trend deciding level for the day is 15883 / 4745 levels. NIFTY trades above this level during the first half-an-hour of trade then we may witness a further rally up to 16114 – 16292 / 4815 – 4869 levels. However, if NIFTY trades below 15883 / 4745 levels for the first half-an-hour of trade then it may correct up to 15705 – 15474 / 4691 – 4621 levels.

BHEL bags Rs1,016cr contract for Hydroelectric project

Bharat Heavy Electricals Limited (BHEL) has secured a contract for the electro-mechanical equipment package for a 1,200 MW (6x200 MW) Hydroelectric project in Bhutan. Valued at Rs1,016cr, the order envisages the manufacture, supply, erection and commissioning of the electro-mechanical equipment for the 1,200 MW Punatsangchhu-I Hydroelectric project. We maintain our Neutral view on the stock.

Areva T&D bags orders worth Rs280cr

Areva T&D India has been awarded two contracts for extra high voltage turnkey projects at the Moga (Punjab) and Bhiwani (Haryana) plants by PGCIL. The two orders, with a combined value of Rs280cr, are for the supply and installation of 765/400 kV air-insulated substations for the Northern Grid-II and the Northern Grid-III. The company will also provide 765kV circuit breakers and substation automation systems as part of the project. Both plants are scheduled for commissioning by the end of 1Q2012. We maintain our Neutral view on the stock.

Nagarjuna Constructions bags Orders worth Rs583cr

Nagarjuna Construction (NCC) has secured five orders aggregating to Rs583cr. The work orders are spread across the verticals of construction of Water supply scheme, Excavation related works, Urban infrastructure and Construction of residential buildings. The Work orders are to be executed over a timeframe of 15-36 months. The Order Book of NCC stands at Rs15,400cr or 3.2x its FY2010E revenues. We maintain a Buy on the Stock, with a Target Price of Rs186.

Madhucon Projects secures three hydro power projects

Madhucon Projects (MPL) has secured three hydro power projects of 25MW each (totaling to 75MW) and expandable to 100MW, on a Build, Operate, Transfer (BOT) basis. The projects have been secured from the Uttarakhand Jal Vidyut Nigam Limited, Govt. of Uttarakhand. The developer shall be operating the projects for a period of 35 years and the DPRs are in the process of preparation. We have valued MPL on an SOTP basis, by valuing its core construction business at 10x, which is at a discount to its listed peers, owing to its scale of operations, on FY2012E Earnings (contributes Rs110.6/share to our Target Price). Its stake in Madhucon Infra has been valued on P/BV basis and contributes Rs99.1/share. We continue to value its land parcel at a 50% discount to the acquisition costs, and it contributes Rs4/share. We maintain a Buy on the Stock, with a Target Price of Rs214.

Economic and Political News
- Finance Ministry allows IRFC to issue Rs5,000cr tax free bonds
- Bulk drug exports hit by government’s 15% value-addition directive
- April’09-Jan’10 Steel consumption up 7.9% yoy

Corporate News
- Sadbhav Engineering Bags Order worth Rs137cr
- Bajaj Electricals to take controlling stake in Starlite Lighting
- GMR plans to raise Rs1,500cr from PE companies