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Reports India

Indian stock market and companies daily report (June 03, 2014, Tuesday)

June 3, 2014, Tuesday, 06:15 GMT | 01:15 EST | 09:45 IST | 12:15 SGT
Contributed by Angel Broking


Indian markets are expected to open on a positive note today tracking positive start to SGX Nifty. Most of the Asian indices too are trading in the green after a gauge for China's services and manufacturing industry increased raising optimism that the world's second-largest economy is rebounding.

US markets ended the choppy Monday session little unchanged as stocks showed a lack of direction. The early weakness on Wall Street was partly due to the release of a report from the ISM showing an unexpected slowdown in the manufacturing sector in May. However, stocks climbed well off their lows after ISM revealed that the data was incorrect due to a series of technical glitches. According to the ISM reading, the PMI inched up to 55.4 in May from 54.9 in April. A separate report from the Commerce Department showed that construction spending rose by less than expected in the month of April, although spending still reached its highest annual rate in five years due in part to revisions to the data for the two previous months.

Meanwhile, India's key benchmark indexes rallied sharply on Monday after the government abolished all EGoM and GoM in a bid to expedite the process of decision making and usher in greater accountability in the system. Investor sentiments remained buoyant ahead of the RBI's monetary policy review scheduled today. The RBI is widely expected to keep rates unchanged to rein in high inflation.


Markets Today

The trend deciding level for the day is 24,555 / 7,324 levels. If NIFTY trades above this level during the first half-an-hour of trade then we may witness a further rally up to 24,839 - 24,994 / 7,408 - 7,453 levels. However, if NIFTY trades below 24,555 / 7,324 levels for the first half-an-hour of trade then it may correct 24,400 - 24,116 / 7,278 - 7,194 levels.


Auto Monthly - May 2014

Ashok Leyland posted in-line volumes at 6,632 units. Although the volumes have declined by 8.7% yoy, the volume performance of the company continues to see an improvement led by gradual pick-up in MHCV sales. MHCV sales witnessed a 8% sequential growth. The LCV sales though continue to remain sluggish and registered a decline of 25.1 % yoy during the month.

Bajaj Auto reported an in-line volume growth of 3.6% yoy to 351,436 units driven by a strong performance in the export markets. Export volumes posted a significant growth of 39.7% yoy aided partly due to the base effect and also on account of the strong performance by the motorcycle segment especially in the African markets. Management indicated that the motorcycle exports registered a sharp growth of ~47% yoy during the month. The domestic volumes though continued to remain lack luster as the sales declined 14.2% yoy due to the weakness in Discover sales. Three-wheeler sales too grew strongly by 11.1% yoy driven primarily by the domestic demand as on the exports front the volumes were impacted due to the export ban in Egypt. The three-wheeler exports ban is due to be lifted from June which is set to boost three-wheeler volumes going ahead.

Hero MotoCorp continued its strong momentum, registering a better-than-expected volume growth of 8% yoy to 602,481 units. The performance was driven by strong momentum in rural markets, marriage season in North India and new launches/ refreshes. Management indicated that several brand building initiatives undertaken over the past few months enabled the company to undertake record numbers.

Mahindra & Mahindra reported in-line volumes as sluggish off-take in the passenger vehicle segment continues to impact the overall sales. Tractor volumes too remained subdued as unseasonal rains and hailstorms in some parts of the country impacted the demand. Total automotive sales posted a decline of 12.9% yoy with the passenger vehicle and the pick-up segment posting a decline of 18.7% and 13.6% yoy. Three-wheeler sales too decline by 7.3% yoy. Tractor sales recorded a modest growth of 1.3% yoy as domestic sales remained subdued (up 2.9% yoy) and exports declined by 30% yoy.

Maruti Suzuki surprised the markets by posting a better-than-expected volume growth of 19.2% yoy to 100,925 units driven by strong performance in domestic sales which surged 16.4% yoy. Export volumes too grew substantially by 51.2% yoy; although it came on a low base of last year. In the domestic markets, the performance was strong across all the segments except for the Mini segment which registered a decline of 7.5% yoy. The Compact segment grew strongly by 53.9% yoy aided by the launch of the Celerio; while, the Super Compact segment (Dzire) posted a growth of 9.8% yoy despite successful new launches from the competitors like Amaze and Xcent. The utility vehicle and the vans segment too posted a robust growth of 22% and 50.2% yoy respectively.

Tata Motors posted a steep 23.9% yoy decline in total sales as continued slowdown in domestic CV and PV sales impacted performance. CV sales (down 25.4% yoy) registered a decline for the 13th straight month; while PV sales too reported a significant decline of 19.3% yoy. On a sequential basis though, total sales surged 1 0.7% as CV and PV sales recorded growth of 7.1% and 22.9% yoy.

TVS Motor Company continued its strong performance, registering a growth of 27.3% yoy to 201,234 units, beating our expectations, driven by robust performance across all the segments. Two-wheeler sales grew strongly by 26.3% yoy led by a 59.8% and 28.3% yoy growth in scooter and motorcycle sales respectively. Scooter sales continue to ride the success of Jupiter Three-wheeler sales grew at a robust rate of 56.1% yoy driven by strong growth in domestic as well as export markets. Total exports continued the strong traction posting a robust growth of 41.9% yoy led by growth across the two-wheeler and three-wheeler segments.


Economic and Political News

- Manufacturing PMI edges up to 51.4 in May

- Marine exports crossed record $5 bn last fiscal

- Industry, service sectors to drive Telangana's economy

- Delhi, Mumbai to gain $1 8 bn/yr by upgrading transport network


Corporate News

- Output of eight core industries rises 4.2% in April

- Coal India misses production target in April-May 14

- State Bank Group to spend 2% of profit on CSR: Bhattacharya

- RBI allows up to 100% FII investment in Zee Entertainment