RBI also needs to look at growth, FM says ahead of policy

A day ahead of RBI's monetary policy review, finance minister P Chidambaram on Monday said the mandate of a central bank is not only to ensure price stability but also to promote growth and generate employment.
Stating he did not expect any hike in interest rates by the commercial banks, the minister said they had enough funds to meet credit demands and that the onus of coming up with large investment projects rests with the industry.
"All over the world thinking in changing. The mandate of a central bank must not only be price stability. The mandate of central bank must be seen as part of larger mandate which includes price stability, growth and maximising employment," he said.

Sensex falls for 4th day, banks hit ahead of RBI meet

The BSE Sensex fell for a fourth consecutive session on Monday to its lowest in more than two weeks as Hindustan Unilever dropped after brokerage downgrades, while interest rate-sensitive stocks fell ahead of the RBI's policy review.

Hindustan Unilever fell for a second consecutive session on Monday after J.P. Morgan and Macquarie downgrade their ratings, citing the prospect of slowing revenue.

Lenders including HDFC Bank and State Bank of India extended falls on uncertainty ahead of Reserve Bank of India's policy review on Tuesday.

The BSE Sensex provisionally fell 0.86 per cent to 19,578, the lowest close since July 11. The index has fallen 3.6 per cent over the last four sessions until Monday.

The Nifty closed down 0.93 per cent at 5,831.65 points.

Wipro shares jump on smart Q1 results, revenue guidance

Wipro shares jumped over 9 per cent in early trade on Monday after the IT major reported an 11 per cent rise in net profit for the first quarter ended June 30 and said it was upbeat about demand for its outsourcing services.

The country's third-largest software exporter had on Friday reported a net profit of Rs 1,623.3 crore for the April-June period, up 10.7 per cent from Rs 1,466 crore in the same period a year ago, on the back of an increase in large contracts.

The Azim Premji-led company also said it was upbeat about demand for its outsourcing services.

Wipro, which does not give annual forecasts, said it expects revenue from the IT services business to increase 2 to 3.9 per cent to $1.62-1.65 billion in the July-September quarter.

Cheering the smart quarterly numbers which were declared post market hours on Friday, shares of Wipro opened the day on a positive note, jumped over 9 per cent to Rs 417.50 on the Bombay Stock Exchange. At 1.46 pm, the scrip was trading 5.09 per cent higher at Rs 402.30.

At the same time, shares of the company were trading 5.38 per cent higher at Rs 402.50 on the National Stock Exchange.

"Wipro's Q1 result was broadly in-line with estimates," said Vivek Mahajan, Head of Research, Aditya Birla Money.

Tracking gains in the stock, Wipro's market capitalisation rose Rs 5,051 crore to Rs 99,377 crore.

Sensex down 129 points; FMCG, PSU stocks major laggards

The Sensex and the Nifty were trading down by about 0.6 per cent in the mid-session on Monday on fresh selling by funds and retail investors ahead of RBI monetary policy review tomorrow amid bearish global cues.

At 1.37 p.m., the 30-share BSE index Sensex was down 129.17 points (0.65 per cent) at 19,619.02 and the 50-share NSE index Nifty was down 45.05 points (0.77 per cent) at 5,841.15.

Among BSE sectoral indices, FMCG, PSU, metal and banking fell the most and were down 2.66 per cent, 1.46 per cent, 1.29 per cent and 1.1 per cent, respectively.

On the other hand, IT, TECk and auto sector stocks remained investors' favourite and were up 0.89 per cent, 0.43 per cent and 0.27 per cent, respectively.

Among 30-share Sensex, Wipro, Jindal Steel, Sun Pharma, Tata Motors and Hero MotoCorp were the top five gainers, while the top five losers were HUL, Hindalco, Sterlite, Coal India and ITC.

European stocks advanced for the first time in three days as companies from Danone to Reckitt Benckiser Group Plc reported results.

Stoxx 50 was up 12.64 points or 0.46 per cent at 2,754.60, FTSE 100 rose 39.73 points or 0.61 per cent to 6,594.52 and DAX climbed 63.94 points or 0.78 per cent to 8,308.85.

Asian stocks fell, with the regional benchmark declining for a fourth day, ahead of a speech by Bank of Japan Governor Haruhiko Kuroda and monetary policy reviews from the US to Europe this week.

Nikkei slumped 468.85 points or 3.32 per cent to 13,661.10, Hang Seng shed 110.01 points or 0.5 per cent to 21,858.90 and S&P/ASX 200 was up 4.3 points or 0.09 per cent at 5,046.33.

The Federal Open Market Committee is meeting on July 30-31, with reports this week expected to show economic growth weakened in the second quarter few jobs were added this month.

The European Central Bank and Bank of England are also meeting this week, after both signalled earlier this month that they will keep the interest rates low.

Vijaya Bank Q1 net up 18.9% to Rs 132 crore

Lower provisioning and rise in net interest income behind rise in net profit
Vijaya Bank, the Bangalore-based public sector lender, on Monday reported 18.9% rise in net profit to Rs 132 crore for the first quarter ended June 30, 2013 compared to Rs 111 crore reported in the corresponding period last year.

The total income for the period went up by 16.3% to Rs 2,699 crore as against Rs 2,320 crore in the year ago period. The operating profit also recorded a rise of 27.4% to Rs 330 crore as compared to Rs 259 crore in the first quarter of last fiscal.

The rise in net profit was on account of a lower provisioning and rise in net interest income. The net interest income registered a marginal rise of 5.6% to Rs 481 crore compared to Rs 455 crore in the year ago quarter. The Bank has made a provisioning of Rs 89 crore as against Rs 130 crore in the year ago period, showing a decline of 31.5%.

The Bank's capital adequacy ratio under Basel-III stood at 10.58%. Its return on assets (annualised) remained flat at 0.48% compared to 0.46% in the year ago period.

The percentage of net non-performing assets (NPA) dipped to 1.45% in June quarter this year compared to 1.67% in June quarter last fiscal.

Reliance Power's 45 MW Wind Power Capacity at Vashpet, Maharashtra Commences Operations

Reliance Power's 45 MW Wind power capacity, in Vashpet, which is located in one of the fastest developing wind zone in Maharashtra had commenced operations. The wind project consists of 18 nos of Wind Turbine Generators having 2.5 MW of rated capacity each. The Wind Turbine Generator is based on superior German technology and is the largest turbine to be certified and installed in India on all parameters.

The power from Vashpet project would be sold to Reliance Infrastructure for distribution to Mumbai in line with regulated tariff structure of Maharashtra. The project has been set up with an investment of over Rs 300 cr. The project is already registered as a Clean Development Mechanism (CDM) project with UNFCCC and is expected to earn -1.6 million carbon credits during its operations phase.

Reliance power is already operating a 40 MW Solar PV project in Rajasthan and with the commissioning of the 45 MW Wind Power capacity, its operating renewable capacity has doubled to 85 MW. In addition, the Reliance group already has another -100 MW of wind power capacity. Reliance Power is also executing country's largest 100 MW Solar CSP power project at Rajasthan which is set to be completed in the current year.

L&T Construction Wins Rs. 8250 Cr Riyadh Metro Project

Larsen & Toubro's (L&T) subsidiary L&T Construction’s Heavy Civil Infrastructure Business has secured an order worth $1403 million from the ArRiyadh Development Authority, Kingdom of Saudi Arabia for the design, construction and commissioning of a metro project in Riyadh, Saudi Arabia.

The company has secured the order as a joint venture partner of ArRiyadh New Mobility Consortium. The total value of order is $5941.93 million. The consortium comprises Larsen Et Toubro, Ansaldo STS, Italy, Bombardier Transportation, UK, Impregito S.p.A, Italy and Nesma Et Partners- Saudi Arabia.

The project is to be implemented during a period of four years, which will be preceded by eight months to prepare the detailed designs and to carry out the enabling works, the coordination for utilities diversion and the site preparation works, and followed by months for system demonstration, trial runs and project handing over. The scope involves design, construction and commissioning of Line 3 (41 km of Driverless Train Operation) to carry approximately 5000 passengers per hour per direction.

The contract includes construction of bridges, tunnels, elevated a underground stations, depots, roads, systems for CCTV and public announcements, SCADA with allied systems, etc. This project would be the first of its kind in the Kingdom.

The rail systems will be undertaken by AnsaLdo STS and rolling stock by Bombardier Transportation. The entire infrastructure facilities together with electromechanical and plumbing systems will be executed by the integrated joint venture comprising AT, Innpregilo and Nesma.

The Consortium’s design engineering will be by Hyder an Idom and the Project Management will be done by Worley Parsons. This order was won against stiff global competition. It aligns well with L&T’s expansion plans in the international arena.

Near term pressure on Dish TV

Could see downgrades on poor June quarter performance
Dish TV stock continues to be under pressure falling a further 3% on the back of a disappointing performance in the June quarter. The stock shed over 8% on Friday. Analysts are likely to rework their estimates given June quarter numbers which were below expectations both on the operating profits level as well as on the bottom line where then company posted higher losses.

While higher content/programming costs as well as advertising expenses saw its EBITDA fall 22%, margins tanked nearly 900 bps at 21%. Given a large chunk of its costs on the satellite, transponder and maintenance as well as debt is dollar denominated, the sharp depreciation of the rupee only added to its woes. All this translated to higher losses for the company. While the bottomline was down 6% over the year ago period, it was down sharply by 30% to Rs 30 crore sequentially.

The company on its part says that the focus now is squarely on improving its profitability and with that in mind it has increased its tariffs both on the set top box as well as subscription fee. While subscription fee was hiked earlier in the quarter, set top box costs were increased this month. The company is looking at adding better quality subscribers and keep churn rates low. Given that new users are subsidised, higher entry costs and lower churn rates help cut the losses.

Some of these initiatives are paying off with free cash flows jumping 120% on a sequential basis to Rs 48 crore. With higher internal cash flows as well as cash at hand, the company is planning to reducing its debt by Rs 750 crore in the current fiscal through internal accruals.

Petronet LNG all set to commission 5 mtpa LNG terminal at Kochi

Petronet LNG is all set to commission 5 million tonnes per annum (mtpa) liquefied natural gas (LNG) terminal at Kochi in Mid August. The company is also planning to set up a third LNG terminal at Gangavaram in Andhra Pradesh, with five MTPA capacity.

At present, the company imports 7.5 million tonnes of LNG annually from RasGas and is in discussions to import more after it expands its Dahej LNG terminal in Gujarat. Further, the company is currently increasing Dahej’s capacity from 10 MTPA to 15 MTPA, and expects the expansion to be completed by December 2015.

Petronet LNG is one of the leading players in oil and natural gas industry space. It has India’s first and largest LNG supply terminal located at Dahej.

IDBI Bank launches eSBTR for on-line payment of Stamp Duties, Registration fees

IDBI Bank in partnership with the Government of Maharashtra has launched the Electronic Secured Bank Treasury Receipt (eSBTR) Project for on-line payment of Stamp Duties & Registration fees. The eSBTR system was inaugurated by Chief Minister of Maharashtra at IDBI Bank, Mumbai, on July 26, 2013.

eSBTR system would provide various benefits such as Single window payment of Stamp Duty and Registration Fee; On-line payment (no more queues and waiting in Bank Branches and adhering to Stamp Hours, Payment facility available on 24 x 7 x 365 basis) Payment without any ceiling, Ease of operation and convenience, etc.

The customer can log onto the website of the authorized bank, click the link for payment of stamp duty/Registration Fees, entering the necessary details and paying the duty through the internet banking account.

Rupee down 18 paise

The rupee on Monday lost 18 paise to 59.22 against the dollar in early trade at the Interbank Foreign Exchange market due to month-end demand of the US currency from banks and importers, ahead of RBI’s policy review on Tuesday.

Forex dealers said increased demand for the American currency ahead of the RBI’s policy review tomorrow and a weak opening in the domestic equity put pressure on the rupee but dollar’s weakness against other currencies in the global market capped the fall.

The domestic currency had gained seven paise to close at one—month high of 59.04 against the dollar on Friday as the RBI’s liquidity—tightening measures continued to lend support.

ITC aims to achieve turnover of Rs 1 lakh crore in FMCG segment

ITC, diversified business conglomerate aims to achieve turnover of Rs 1 lakh crore in its new fast moving consumer goods other than cigarettes business by 2030. During 2012-13, it has reported turnover of Rs 7,000 crore in the FMCG segment, which comprises of packaged food, personal care, education and stationary products, agarbatti, safety matches and lifestyle retail ventures - Wills Lifestyle and John Players.

The company has posted a rise of 18.05% in its net profit of Rs  1891.33 crore for the quarter ended June 30, 2013 as compared to Rs 1602.14 crore for the same quarter in the previous year. Total income has increased by 10.72% at Rs 7613.88 crore for quarter under review as compared to Rs 6876.43 crore for the quarter ended June 30, 2012.

Ajanta Pharma dips after bonus announcement

The board has recommended a bonus shares in the ratio of 1:2.

Ajanta Pharma is trading lower by 4% at Rs 986, falling over 11% from intra-day’s high, after recommending a bonus shares in the ratio of one new fully paid-up equity share for every two fully paid-up equity share.

Meanwhile, the pharmaceutical company has reported a robust 66% year-on-year (yoy) jumped in its net profit at Rs 33 crore on back of 26% yoy growth in operational revenues at Rs 219 crore for the quarter ended June 30, 2013 (Q1).

The stock opened at Rs 1,021 and hit a high of Rs 1,110 on BSE, before the announcements of bonus shares and Q1 earnings. A combined 331,362 shares have changed hands on the counter till 1118 hours on BSE and NSE.

Natco Pharma up 20% post US ruling on Copaxone patent case

Natco Pharma  shares are locked at 20 percent upper circuit Monday after the healthcare firm received favourable US ruling on Copaxone patent case.

"We are pleased to announce the US Court of Appeals for the Federal Circuit ruling, reversing a district court's finding related to Teva's US patent for Copaxone," Natco said in its filing.

Copaxone (Glatiramer Acetate) is used in treatment of relapsing-remitting multiple sclerosis.

According to a release, the product is estimated to have clocked revenues in USA, of about USD 3.45 billion during 2012.

After this favourable ruling, the company may now launch generic Copaxone through its marketing partner Mylan in May 2014.

Coal India inks 82 FSAs for about 34,793 MW capacity Power Plants

Coal India (CIL) has signed 82 Fuel Supply Agreements (FSAs) as on July 25, 2013, with power stations with a capacity of 34,793 MW. This includes 16 power stations belonging to NTPC and its joint venture companies (JVs). Besides, 11 more FSAs are ready to be signed shortly with NTPC or its JVs, while another 23 FSAs with state and private sector entities are in the pipeline. These FSAs were part of the 131 FSAs for a capacity of 60,678 MW which CIL was directed to sign in February, 2012. This will substantially increase the power generation during the current and subsequent years.

Besides, the Ministry of Coal has issued another Presidential Directive to CIL on July 17, 2013 for signing of FSAs for a capacity of 78,000 MW instead of the earlier 60,678 MW. This will not only increase the power generation further but will also fast track several power projects which are under development.

Coal India is the world’s largest coal mining company. It also produces non-coking coal and coking coal of various grades for diverse applications.

Dena Bank seeks Rs 2,000 crore capital infusion from central government

Dena Bank, public sector lender is looking for Rs 2,000 crore capital infusion from the Central government, in order to support its future loan growth as the tier-I capital of the Bank fell below 8% by the end of June quarter. The bank’s capital adequacy ratio stood at 11.12% even as tier-I capital, which is critical to support loan growth, fell below 8% to 7.28%. In the last fiscal, the public sector lender had requested for Rs 1,200 crore of capital infusion from the government.

The bank’s net profit for the Q4FY13 declined by 50.68% at Rs 125.67 crore as compared to Rs 254.79 crore for the Q4FY12. However, its total income has increased by 17.23% to Rs 2539.74 crore for the quarter from Rs 2166.36 crore for the corresponding quarter of the previous year.

Sensex down 39 points in early trade

The BSE benchmark Sensex on Monday fell over 39 points in early trade, extending losses for the fourth straight session, due to increased selling by funds ahead of RBI’s policy review tomorrow amid a weak trend in other Asian markets.

The 30-share barometer fell by 39.37 points, or 0.19 per cent, to 19,708.82. The index had lost nearly 555 points in the previous three sessions.

Stocks of banking, FMCG, realty, metal and capital goods sectors were major losers, pulling down the benchmark Sensex.

The wide-based National Stock Exchange index, Nifty moved down by 16.19 points, or 0.28 per cent, to 5,869.30.

Brokers said selling by funds and other participants ahead of Reserve Bank of India’s monetary policy review to be announced tomorrow and a weak trend in the Asian region, mainly dampened the trading sentiment here.

In the Asian region, Hong Kong’s Hang Seng index traded lower by 0.51 per cent, Japan’s Nikkei Index fell 2.33 per cent, in early trade.

The US Dow Jones Industrial Average ended 0.02 per cent higher on Friday.

ONGC inks MoU with RIL on Eastern Offshore facility sharing arrangement

Oil and Natural Gas Corporation (ONGC) has inked a memorandum of understanding (MoU) with Reliance Industries (RIL) to explore the possibility of sharing the latter’s infrastructural facility in the East Coast. The MoU aims at working out the modalities for sharing of infrastructure, identifying additional requirements as well as firming up the commercial terms.

This shall not only minimize ONGC’s initial Capex but also expedite its field development resulting in early monetization of its deep water fields adjacent to the fields of RIL. The companies intend to enter into a formal agreement after conducting a joint study which will be spread over the next nine months.

ONGC, the country’s largest oil & gas producer, has drawn a roadmap to make substantial investment over a period of next five years both in exploration & developmental activities, and deepwater exploration and development constitutes a major component of the same. Under this plan, ONGC has a conservative estimate to produce about 6 to 9 MMSCMD of gas by mid-2017 from G-4, KG-DWN - D & E fields in the first phase.

Dr Reddy'S launches Donepezil Hydrochloride tablets

Dr. Reddy’s Donepezil Hydrochloride Tablets, 23 mg is available in bottle count sizes of 30 and 90.

Dr. Reddy’s Laboratories announced that it has launched Donepezil Hydrochloride Tablets, 23 mg,  a therapeutic equivalent generic version of ARICEPT®, 23 mg in the US market on July 26, 2013, following the approval by the United States Food & Drug Administration (USFDA) of Dr. Reddy’s ANDA for Donepezil Hydrochloride Tablets, 23 mg.

The ARICEPT, 23 mg brand had U.S. sales of approximately $92.6 Million MAT for the most recent twelve months ending in May 2013 according to IMS Health*.

Dr. Reddy’s Donepezil Hydrochloride Tablets, 23 mg is available in bottle count sizes of 30 and 90.

FIIs pull out Rs 18,500 cr from Indian capital market in July

Overseas investors have pulled out nearly Rs 18,500 crore (about $ 3 billion) from the Indian capital markets so far this month, amid concerns over the US Fed policy and the depreciating rupee.
   
The outflows as of July 26 were about Rs 12,081 crore ($ 2 billion) from the debt market and Rs 6,394 ($ 1 billion) from equities, according to data on net FII investments with market regulator Sebi.
   
Foreign institutional investors (FIIs) had withdrawn a record Rs 44,162 crore ($ 7.5 billion) from the debt and equities markets in June.
   
The weakness in the Indian currency was instrumental in overseas investors exiting the debt markets as the rising cost of hedging a volatile rupee hurts the yield differential the FIIs work with, according to market experts.
   
The rupee slumped to a lifetime low of 61.21 (intra-day) against the US dollar on July 8. Since April 30, the rupee has depreciated by about 13%. The currency closed at 59.04 against the dollar on Friday.
   
That apart, there was turmoil in the global markets after the US Federal Reserve said it may taper the $ 85-billion-a -month bond purchase programme later this year and end it next year if the US economic recovery is up to its expectations.
 
The Fed's loose monetary policy has driven asset prices higher, including those in emerging markets, and fears are that inflows may be hit if the US monetary stimulus comes to an end.
   
FIIs had been aggressive buyers of bonds in the first five months of 2013 on account of higher yields offered by the government and corporate debt. The debt market witnessed a net inflow of almost Rs 25,000 crore in January-May this year.
   
So far this year, foreign investors have pulled out a net Rs 21,169 crore ($ 3.2 billion) from the debt market, while foreign investment in the country's equity market is a net Rs 65,785 crore ($ 12.4 billion).
   
As of July 26, the number of registered FIIs in the country stood at 1,756 and the total number of sub-accounts at 6,426. 

Government gets Rs. 1,770-crore investment proposal for telecom products

: The government has received a Rs. 1,770-crore investment proposal from a domestic company for the manufacturing of telecom products.

"Our policies have attracted investors. The aim of the government is to reduce dependence on imports. In total investment that we have received so far there is Rs. 1,770 crore proposal from an Indian firm for manufacturing telecom products," DEITY Joint Secretary Ajay Kumar told PTI.

Without disclosing the name of the firm, Mr. Kumar said that the application is in process and is expected to be approved by inter-miniterial panel within a month.

The Department of Electronics and Information Technology under National Policy on Electronics 2012 and further strengthened by National Telecom Policy 2012 has so received investment proposal of Rs. 4,595 crore for electronics manufacturing which includes telecom and IT products.

The proposal by the domestic company is the biggest among proposals that government has received so far for indigenous manufacturing, an industry source said.

"Government has come up with good policies but recent rethinking by it on Preferential Market Access Policy is enough to shake investor's confidence. Telecom sector has already seen dip in investments due to regulatory uncertainity," the source said.

The Cabinet in February last year approved the PMA policy seeking to give preference to domestically manufactured electronic products which have security implications and for government procurement also.

The PMO has put on hold the policy, and said that it will 'revisit and review' the entire policy on providing preference to domestically manufactured electronic goods.

According to regulator Trai, only 12-13 per cent of all local products made with the aid of foreign vendors were used in the sector during 2009-10. However, purely India-made products formed just 3 per cent of the market.

Out of the total investment proposal received for domestic manufacturing, government has cleared proposals worth Rs. 961 crore which inlcudes invetsment from Bosch Electronics, Samsung and an Indian firm Sahasra Electronics.

Some of the other investments proposal inlcude Rs. 450 crore for manufacturing of consumer electronics, Rs. 310 crore LEDs and LED Products, Rs. 45 crore for electronics components, Rs. 610 crore automotive electronics, Rs. 40 crore power electronics, Rs. 210 crore strategic electronics and Rs. 750 crore for semiconductor test and packaging.

Markets may open with marginal gains

Markets are expected to open tad higher today but further gains could be capped as investors may remain cautious ahead of the Reserve Bank of India’s monetary policy tomorrow.

At 8:15AM, the SGX Nifty was up trading flat at 5,917.

According to the technical charts, "Key momentum oscillators are in favour of the bears, hence the markets may face downward pressure in the near term. On Monday, the Nifty may seek support around 5,855-5,840, while face resistance around 5,915-5,935."

Meanwhile Asian shares dropped in early trades on expectations of dovish comments from the US Federal Reserve after a policy review this week.

Among the key Asian indices, Japan’s Nikkei was down  2% to 13,880.

On Friday, US stocks ended higher on expectations of stimulus.

The Dow Jones Industrial Average rose 3.22 points, or 0.02 percent, to end at 15,558.83. The Standard & Poor's 500 Index gained 1.40 points, or 0.08 percent, to finish at 1,691.65. The Composite Index advanced 7.98 points, or 0.22 percent, to close at 3,613.16.

Domestically, in the earnings calendar we have Colgate Palmolive, IDFC set to unveil their first quarter results later today.

Following stocks are expected to move on the exchanges today:

Coal India Ltd (CIL) has signed fuel supply pacts with NTPC's 16 power plants and joint ventures, while 11 more agreements with the power major and its JVs are being processed.

As part of its cost cutting exercise, RP Sanjiv Goenka group flagship company CESC is set to get delisted from London Stock Exchange (LSE).   The market of the company's shares in UK has practically frozen and the dealings in the shares in recent years has been very low.

Wipro on Friday posted a net profit of Rs 1,081.2 crore,up 20.8% from the same period last year. The company's revenue was reported at Rs 8,741 crore compared to Rs 8,314 crore, up 5.1%.

Private power utility JSW Energy today posted a higher net profit of Rs 214.26 crore in the three months ended June 2013, primarily driven by higher income.   The Sajjan Jindal-led company had a net profit of Rs 3.41 crore in the year-ago period.  

RPG Life Sciences today reported over 19-fold increase in net profit at Rs 54.69 crore for the first quarter ended June 30, 2013. The company had posted a net profit of Rs 2.79 crore during the same period of previous fiscal.

Mahindra Lifespace Developers, the realty arm of Mahindra Group, today said it has entered into a joint venture with a investment arm of UK's Standard Chartered Bank to develop residential properties in the country.