Thursday, 24 October 2013

Sensex hits 21,000; then retreats

BSE Sensex closed at 20725 down 42 points, while NSE Nifty closed at 6,164 down 14 points over the previous close.

The BSE Sensex surged past the 21,000 mark for the first time in three year on Thursday ahead of the Reserve Bank policy meet scheduled to be held on October 29. However, the gains were short-lived as traders preferred to book some profits after higher levels.

In early trades, the BSE Sensex hit intra-day high of 21,039 and the Nifty too hit a nearly three year high of 6252.

Sensex hit the 21k milestone on the back of strong inflows from foreign investors throughout the month. Foreign funds have bought US$1.7bn in Indian equities so far this month, taking their total purchases for the year to US$15.35bn.

Today’s intra-day decline was led by selling pressure in the IT, Telecom, Power and the Realty stocks. Even the mid-cap and the small-cap stocks were under pressure. However, bucking the negative trend were the capital goods, auto, consumer durables and the banking stocks.

BSE Sensex closed at 20725 down 42 points, while NSE Nifty closed at 6,164 down 14 points over the previous close.

HCL Tech, Wipro, Coal India, TCS, BHEL, Jindal Steel, PowerGrid, NTPC and Reliance Industries were among the top losers in the Nifty.

On the other hand, Ranbaxy, IDFC, NMDC, M&M, GAIL, HDFC Bank, L&T and Tata Motors were among the top gainers.

On the BSE, 1292 stocks declined against 1197 advancing stocks, while 184 remained unchanged.

The INDIA VIX was up 1.4% at 20.64. It hit a day’s high of 21.27 and low of 19.20.

Stock News 

Amar Ambani, Head of Research at IIFL said, “ACC balance sheet continues to be strong with cash and cash equivalent at Rs30bn. Debt/equity continues toremain low as most of the recent expansion has been funded through internal accruals. On business front, we expect cement demand to pick up due to onset of peak construction season and infrastructure spending picking up pace ahead of election. We believe current valuations leave enough room for upside and recommend Buy.”

Kotak Mahindra Bank erased early gains to end lower by 0.6% to close at Rs706. The bank managed to announce quarterly results which were inline with expectations. The 2nd quarter consolidated net profit grew 16% yoy to Rs5.83bn. Net interest margin of the bank increased 10 basis points sequentially (30 basis points on yearly basis) to 4.9% during September quarter.

Shares of Bharti Airtel gained half a percent to close at Rs349 after the company announced that its board approved the merger of wholly owned subsidiary Airtel Broadband Services with itself.

Shares of Jet Airways declined by 2.2% to close at Rs338 after the company reported an eight-fold increase in losses at Rs8.91bn in the September quarter on account of steep fall in the rupee, slowdown in the domestic aviation market and rise in fuel costs. It had logged Rs997mn loss in the year-ago period.

Shares of IPCA Labs gained by 2.12% to close at 678 after the company reported a 3.48% rise in its standalone net profit at Rs1.29bn for the second quarter ended September 30, 2013. The company had posted a net profit of Rs1.25bn in the corresponding period last fiscal.

ICICI Bank gains as its arm enters into strategic tie-up with GCA Savvian

ICICI Bank is currently trading at Rs 1034.60, up by 10.10 points or 0.99% from its previous closing of Rs. 1024.50 on the BSE.

The scrip opened at Rs 1025.70 and has touched a high and low of Rs 1047.70 and Rs. 1022.00 respectively. So far 338630 shares were traded on the counter.

The BSE group 'A' stock of face value Rs 10 has touched a 52 week high of Rs 1236.90 on 28-May-2013 and a 52 week low of Rs 758.80 on 28-Aug-2013.

Last one week high and low of the scrip stood at Rs 1027.25 and Rs 958.60 respectively. The current market cap of the company is Rs 119229.35 crore.

The Institutions and Non-Institutions held 62.61 % and 8.23 % respectively.

ICICI Securities, the investment banking arm of ICICI Bank, has entered into a strategic alliance with GCA Savvian Corporation, a leading Japanese independent investment bank, to jointly pursue M&A opportunities in India and Japan. The alliance will enhance both ICICI Securities and GCA Savvian's respective M&A offerings by leveraging each bank's M&A advisory capabilities, deep understanding of local markets as well as their long-standing corporate relationships within those markets to offer high quality advice to clients.

ICICI Securities is a leading full service investment bank with operations in equity markets, corporate finance, M&A advisory services. It has consistently been among top 3 Indian mid-market focused M&A advisory firms. On the other hand, GCA Savvian is a global firm headquartered in Tokyo, Japan and San Francisco, USA providing M&A and capital raising advisory services. It is widely recognized as the leader in cross-border M&A with Japan.

ICICI Bank is India's largest private sector bank and the second largest bank in the country, with consolidated total assets of $122 billion at December 31, 2012. The Bank’s presence currently spans 19 countries, including India.

Unilever reports sales slowdown in third quarter

Slowdown in emerging markets is hitting demand for its consumer goods

Unilever on Thursday reported slower sales growth for the third quarter, providing further evidence that a slowdown in emerging markets is hitting demand for its consumer goods.

The Anglo-Dutch maker of Ben & Jerry's ice cream and Dove skincare products had warned in September that a slowdown - in places like Indonesia, Brazil and Vietnam - had accelerated, and that it expected underlying sales growth of only 3% to 3.5%.

The company reported a 3.2% rise in third quarter sales, which compared with a 5% increase for the second quarter.

"This is a soft quarter without a shadow of a doubt," Chief Financial Officer Jean Marc Huet told Reuters in an interview.

Unilever generates about half its annual sales from developing and emerging markets, a fact that has weighed on its share price, partly because emerging market currency weakness has put pressure on demand in several markets such as India.

The company said it expects sales growth to improve in the fourth quarter, helped by new products.

In the third quarter, sales in emerging markets rose 5.9%. Emerging market sales rose 10.3% in the second quarter. Huet said Unilever expects growth in those markets to continue in the 6 to 7% range in the coming quarters.

Third-quarter sales reflected a 1.9% rise in volume and a 1.3% rise in prices, the company said.

Unilever's shares were down 0.7% in London at 0710 GMT.

Markets slip into the red; IT weighs

IT heavyweights, TCS, Infosys and Wipro along with Reliance Industries among the top losers

Markets slipped into the negative territory in noon trades on profit taking at higher levels. The ones weighing down the indices were Reliance Industries and the IT majors, TCS, Infosys and Wipro.

At 1330 hrs, the Sensex was down 27 points at 20,740 and the NIfty gave off 14 points to trade at 6,164

Markets continue to trade on a strong note with index heavyweights like ICICI Bank, HDFC Bank, L&T and ITC leading the noon gains.

At 1310 hrs, the Sensex was up 110 points at 20,878 and the Nifty edged higher by 30 points to trade at 6,209.

In the broader markets, the midcap index gained 0.7% and the smallcap index added 0.4%.

Barring IT and Health Care indices, losing between 0.1-0.8%, all the other were in the positive territory with gains of atleast 0.3%.

The top sectoral gainers were Consumer Durables, Bankex, Capital Goods and Auto indices gaining 1-1.5%.

The major gainers among the Sensex-30 were Mahindra & Mahindra, Bharti Airtel, ONGC, HDFC Bank, ICICI Bank, L&T, Tata Motors and Tata Power with gains between 1-2.5%.

Among the ones in the red were Wipro, TCS, Dr Reddys Lab, Coal India and Hindalco down 1-2%.

Cipla, Baja Auto and Reliance Industries lost 0.4-0.7%.

The market breadth was positive on the BSE. 1,217 stocks advanced while 1,134 stocks declined.

In Asia, Chinese shares slipped in volatile trade on Thursday as a further spike in China's money-market rates tempered the effect of a survey showing a pick-up in manufacturing.

China's CSI300 index dipped 0.2% in choppy trade after sliding 2.1% in the previous two sessions, and Hong Kong's Hang Seng Index dropped 0.7%.

Japan's Nikkei share average eased 0.4% in relatively light trade, also hurt by a firmer yen against the dollar.

But MSCI's broadest index of Asia-Pacific shares outside Japan ticked up 0.1%, having fallen 0.9% on Wednesday to end a four-day winning streak.

Major European indices FTSE, DAX and CAC opened up as much as 0.3-0.6%, rebounding from yesterday's decline.

Jet Airways stock crashes on 8-fold rise in net loss

Shares of Jet Airways fell more than six per cent in the morning trade on the bourses today after the Naresh Goyal-run company reported an eight-fold increase in net loss at Rs 891 crore for the September quarter.

The company has blamed a steep fall in rupee, slowdown in the domestic aviation market and rise in fuel costs for a sharp widening in standalone net loss to Rs 891 crore in the July-September quarter. It had logged Rs 99.7-crore loss in the year-ago period.

Reacting to the numbers, shares of Jet Airways opened on a weak note and then slumped 6.06 per cent to Rs 325.05 on the BSE. Similarly on the National Stock Exchange, the scrip opened at Rs 330 and then fell 6.42 per cent to an intra-day low of Rs 324.15.

The decline in the counter assumes significance as the broader market was trading in the positive territory with significant gains. At 11.26 a.m., the 30-share benchmark index Sensex was trading at 20,943.49, higher by 175.61 points.

Market experts said that the decline in the counter was largely because investors dumped the stock after the company reported its worst quarterly loss on record.

Jet Airways Group operates more than 550 flights a day with its two brands, the full-service Jet Airways and the low-cost JetLite.

The consolidated loss was much higher at Rs 998.5 crore. The airline did not offer a comparative figure either this quarter or in the corresponding quarter last fiscal, when it offered only standalone numbers.

Jyothy Laboratories strengthens on plan to raise funds up to Rs 400 crore

Jyothy Laboratories has received an approval for raising of funds up to Rs 400 crore through issue of Non-Convertible Debentures (NCDs) to replace the existing borrowings. The board of directors at its meeting held on October 22, 2013 has approved for the same.

The board has also approved to acquire 33,00,000 Compulsorily Convertible Cumulative Participatory Preference Shares of Rs 10 each (100% of preference capital) and 50,000 Equity shares of Rs 10 each (0.38% of equity capital) in Jyothy Fabricare Services, subsidiary of the company, presently held by IL&FS Trust Company for TARA India Fund IV Trust. The company presently holds 74.71% in Jyothy Fabricare Services.

Jyothy Laboratories is one of the leading players in the mid and economy segments of the FMCG industry having its presence in Fabricare (Detergents/soaps for clothes), Household Insecticide (Repellent coils/liquid or spray) Dishwashing products/Toilet cleaners, Personal care (Toilet soap) and Others (Incense sticks).

Indiabulls Housing Q2 PAT up 22%

Consolidated Total Revenue in Q2 FY14 stood at Rs. 1,474.2 crore

The Board of Directors of Indiabulls Housing Finance Ltd (IBHFL), India’s third largest housing finance company, announced its unaudited results for the quarter ended September 30, 2013, following its meeting on Wednesday, October 23.
Consolidated Total Revenue in Q2 FY14 stood at Rs. 1,474.2 crore, up 25.09 % from Rs. 1,178.5 crore in the quarter ended September 30, 2012, while Net Profit increased 22 % to Rs. 370.4 crore from Rs. 303.6 crore in the same period last year, aided by strong demand for retail home loans in Tier I, Tier II and Tier III cities. Net Interest Income grew 28.47 % to Rs. 644.9 crore from Rs. 502 crore a year ago. The board recommended an interim dividend of 350 % at Rs. 7 per share of face value of Rs. 2.
Despite the tough economic conditions, IBHFL has grown its loan assets by an average of Rs. 1,700 Crore – Rs. 2,000 Crore per quarter for the last 16 quarters. IBHFL’s loan assets have grown over the last 5 years at a CAGR of 26%.

FINANCIAL HIGHLIGHTS FOR H1 & Q2 FY14
Spreads for Q2 FY14 were stable at 350 bps on book basis and 320 bps on incremental basis.
Balance Sheet size at Rs. 42,975 crore as of September 30, up 21.6 % from Rs. 35,353 crore a year ago
H1 FY14 PAT at Rs. 721.9 crore, up 26.38 % from Rs. 571.2 crore a year ago
H1 FY14 NII at Rs. 1,243.6 crore, up 29.31 % from Rs. 961.7 crore a year ago
Q2 FY14 NII at Rs. 644.9 crore, up 28.47 % from 502 crore a year ago
Q2 FY14 PAT at Rs. 370.4 crore, up 22 % from 303.6 crore a year ago
Gross NPA in Q2 FY14 at 0.85 % of total advances vs 0.76 % a year-ago.
 Net NPA in Q2 FY14 at 0.44 %, vs 0.31 % a year-ago.
Total provision pool is Rs 462.1 crore against gross NPAs of Rs. 324.6 crore, which is a provision cover of 142 %.
Borrowing costs for IBHFL has remained relatively stable during the quarter despite the spike in short-term borrowing costs and liquidity tightness in the banking system in August. The MSF rate cut by the Reserve Bank of India in September helped to ease cost of funds. The company has recently received approval from the Reserve Bank of India to raise $200 million via external commercial borrowings, opening up a new source of raising funds.

Despite slower economic growth, IBHFL continues to see strong demand from retail housing loans in Tier I and Tier II and Tier III cities, which contributed to the strong business traction seen in this quarter. The company has 205 branches across India as of September 30, 147 of which are in Tier II and Tier III cities, further reinforcing IBHFL’s presence in semi-urban locations. IBHFL continues to focus on home loans of less than Rs. 25 lakhs, which is the largest business segment for the company. IBHFL is also offering a festive home loan scheme of 10.25% till November 30.

Commenting on the results and financial performance, Mr. Gagan Banga, MD & CEO, Indiabulls Housing Finance Ltd said, “The current macro-economic environment is challenging but we have seen strong demand for housing loans in Tier I and Tier II and Tier III cities, which has contributed to our robust performance. We expect the momentum in individual home loans to strengthen in the second half of the fiscal year.”
IBHFL’s capital adequacy ratio stood at 20.32 % of the risk weighted assets as of September 30, as against the minimum requirement of 12 %. Tier 1 capital was 15.98 % against a minimum requirement of 6 %.
Gross non-performing asset in the quarter ending September was at 0.85 % of total advances, compared with 0.76 % in the corresponding quarter last year. Net non-performing assets stood at 0.44 %, compared with 0.31 % in the year-ago period. Total provision pool is Rs. 462.1 crore against gross NPAs of Rs. 324.6 crore, which is a provision cover of 142%.

Fortis Healthcare shines as arm concludes divestment of Quality Healthcare

Fortis Healthcare’s subsidiary - Fortis Healthcare International has completed the transaction to sell its 100% stake in Altai Investments on October 24, 2013. The company had earlier on October 14, 2013 decided to sell its 100% stake in Altai Investments, the holding company for Quality Healthcare (QH), Hong Kong, to Bupa, for $355 million.

The company has taken this step in line with its strategic decision to intensify its focus on core hospital and diagnostic business in India and to reduce its debt.

Fortis Healthcare is an integrated healthcare-delivery service provider in Asia. The healthcare verticals of the company span primary care, diagnostics, day care speciality and hospitals, with a healthcare network spanning 9 countries.

Sensex touches 21,000 level for first time since 2010

The BSE benchmark Sensex regained the psychological 21,000 level after a gap of nearly three years by surging 262 points in the morning trade today on heavy capital inflows in fundamentally strong sectors such as realty, banking and auto.

At 11.03 a.m., the 30-share BSE index Sensex was up 213.83 points (1.03 per cent) at 20,981.71 and the 50-share NSE index Nifty was up 59.15 points (0.96 per cent) at 6,237.50.

Barring IT, all other BSE sectoral indices were trading in the green. Among them, Consumer Durables index was up 2.2 per cent, followed by Bankex 1.65 per cent, Realty 1.63 per cent and Auto 1.35 per cent.

Top five Sensex gainers were Bharti Airtel, HDFC Bank, M&M, Tata Motors and ICICI Bank, while Coal India, Wipro, TCS, Cipla and Dr Reddy's were the top five losers.

The Nifty and the Sensex opened flat on Thursday. The Nifty opened at 6,163, down 15 points, while the Sensex opened at 20,766, down two points.

The HSBC Markit flash Purchasing Managers Index (PMI) for China showed a reading of 50.9 for October above the market expectation of 50.4 with the September number at 50.2.

The survey said that new orders were at a seven-month high. A PMI number above 50 indicates expansion in economic activity in a sector while a score below 50 signals otherwise.

An SMC Global report said: “Asian stocks pared losses, while commodity currencies rallied with oil and metals as China’s manufacturing beat estimates, signalling the recovery may be accelerating in the world’s second-largest economy. US stocks declined on Wednesday, as weakness in global stocks and mixed earnings from a pair of industrial companies prompted a pause in their recent rally.”

Japan's Nikkei fell 92.1 points or 0.64 per cent to 14,334, Hong Kong's Hang Seng plunged 204.27 points or 0.89 per cent to 22,795.70 and Australia's S&P/ASX 200 was up 22.30 points or 0.42 per cent at 5,378.40,

Petroleum Ministry allows upstream cos to produce oil, gas before clearance of field investment plans

In a major development, Petroleum Ministry has allowed private upstream companies like Reliance Industries and Cairn India to start producing oil and gas from discoveries even before securing approval for field investment plans. To enable monetization of the finds contained with an already producing area, Oil Minister M Veerappa Moily approved 5-page guidelines for production and development of oil and gas discoveries.

As per the guidelines approved, each company will be allowed the option to submit an integrated development plan (IDP) encompassing multiple new discoveries. Presently, every discovery is treated as a separate factory and operators are required to first get approval for commercial viability and then seek approval for an investment plan, called a field development plan (FDP).

However, now the Ministry has permitted submission of declaration of commerciality (DOC) and FDP/IDP together by subsuming DOC within the FDP/IDP. Further while, the cases with single discovery will be termed as FDP and cases of multiple discoveries will be termed as IDP.

Thus, with these new guidelines, the contractor, for early monetisation of new discoveries in a mining lease (or producing) areas, may be allowed by the Management Committee (MC) to produce hydrocarbons from the notified new discoveries, pending approval of FDP/IDP. However, this will be subjected to condition that the contract has taken approval of the MC for the annual work programme, budget and program quantity for such new discoveries. Additionally, recovery of all costs associated with new recoveries pending approval of FDP/IDP, despite their inclusion in the annual work program and budget, will not be permitted.

Tata Communications’ arm to introduce 15,000 white-label ATMs in 3 years

Tata Communications’ wholly owned subsidiary - Tata Communications Payment Solutions (TCPSL) is planning to introduce 15,000 Indicash white-label ATMs across the country over the next 3 years. 67% of these will be deployed in semi-urban and rural areas and 33% will be installed in metro and urban markets. Phase two of the roll out will be to offer value added and utility services to customers using Indicash ATMs and to introduce offers and third party promotions. TCPSL is also planning to open 100 new white-label ATMs in Kerala by the end of this year.

TCPSL has launched its first white-label ATM in Thane in June, has 350 units now in place. TCPSL is aiming to make ATM services available across urban, semi-urban and rural locations that have negligible or minimal banking infrastructure. TCPSL has tied up with Kerala based Federal Bank for cash supply and is talking to other banks also in this regard.

Tata Communications is a leading global provider of a new world of communications. With a leadership position in emerging markets, Tata Communications leverages its advanced solutions capabilities and domain expertise across its global and pan-India network to deliver managed solutions to multi-national enterprises, service providers and Indian consumers.

Jindal Steel rises on expectation of doubling steel production capacity

Jindal Steel and Power is expecting to double its steel production capacity to 10 million tonnes. In this regard, the company will invest Rs 20,000 crore in three years. At present, the company’s facilities are spread across Raigarh in Chhattisgarh (1 million tonne), Angal in Odisha (2.5 million tonne) and Oman in West Asia (2 million tonne).

The company will add 3.5 million tonnes per annum to its existing facility at Angal, while another one million tonne will be added to the Chhattisgarh unit through operational efficiencies.

JSPL is a part of Jindal Group and is a leading player in Steel, Power, Mining, Oil & Gas and Infrastructure. The company produces economical and efficient steel and power through backward integration from its own captive coal and iron-ore mines and passes on the benefits to its customers.

Mindtree trades with traction on the bourses

Mindtree is currently trading at Rs. 1389.40, up by 12.60 points or 0.92% from its previous closing of Rs. 1376.80 on the BSE.

The scrip opened at Rs. 1375.00 and has touched a high and low of Rs. 1404.00 and Rs. 1375.00 respectively. So far 3956 shares were traded on the counter.

The BSE group 'B' stock of face value Rs. 10 has touched a 52 week high of Rs. 1430.85 on 23-Oct-2013 and a 52 week low of Rs. 645.10 on 01-Nov-2012.

Last one week high and low of the scrip stood at Rs. 1430.85 and Rs. 1290.00 respectively. The current market cap of the company is Rs. 5795.72 crore.

The promoters holding in the company stood at 16.60% while Institutions and Non-Institutions held 45.18% and 38.22% respectively.

Mindtree, a global information technology solutions company, has successfully completed its first year of US Delivery Center in Gainesville Florida. The company has grown its presence in Gainesville significantly in just one year, establishing it as the go-to onshore source for agile and digital business expertise.

The company is hosting its first anniversary celebration to mark its success in adding over 100 jobs to the community, the addition of several Fortune 500 companies to its roster of clients and the upcoming expansion of the center in early 2014. The celebrations begin on October 24th with an open house at the Gainesville center in Ayers Technology Plaza, 720 SW 2nd Avenue, South Tower from 4pm to 6pm followed by a southern-style soiree.

Mindtree is a global information technology solutions company with revenues of over $435 million. Our experts are driven to engineer meaningful technology solutions to help businesses and societies flourish.

Welspun shareholders approved “Scheme of Arrangement”

The demerger will also better enable the management team to protect, grow and nurture each line of business in a more distinct manner.

Welspun Corp Ltd. (WCL), the flagship Company of the $ 3.5 billion Welspun Group today announced that its shareholders and creditors have unanimously approved the “Scheme of Arrangement” under which the “Other Businesses” undertaking is being demerged into Welspun Enterprises Limited. The meeting was conducted as per the directions of the Hon’ble High Court of Gujarat. The scheme is also subject to the sanction by the Hon’ble High Court of Gujarat.

Post demerger, Welspun Enterprises Limited shall comprise of Steel, Infrastructure, Oil & Gas exploration and Energy businesses while Welspun Corp Ltd., will now solely focus on Pipe and Plates business in India and globally.

Through this demerger, Welspun Group aims to create two focused, independently run companies, Welspun Corp Ltd and Welspun Enterprises Limited with enhanced value creation across each business.

The demerger will also better enable the management team to protect, grow and nurture each line of business in a more distinct manner, bring more clarity on each business to pursue its strategic objectives and enhance shareholder value

RBI issues paper on Corporate Pricing Power, Inflation, IIP

This paper examines the relationship among pricing power, inflation and manufacturing output under a structural vector auto regression framework

The Reserve Bank of India on Wednesday proposed a Working Paper titled “Corporate Pricing Power, Inflation and IIP Growth: An Empirical Investigation”. The working paper has been authored by Angshuman Hait, Joice John, Dr. Abhiman Das and Anujit Mitra.

Pricing power is generally characterised as the degree to which firms pass through changes in input costs to prices of finished goods. Previous studies have indicated that the degree to which firms pass through both, price increases at competing firms and cost increases, depends upon the level of inflation. Further, the relationship among corporate pricing power, inflation and output might well be affected by other variables, namely, market structure and the level of economic activity.

This paper examines the relationship among pricing power, inflation and manufacturing output under a structural vector auto regression (SVAR) framework, after controlling the effects of market power and level of economic activity using quarterly data for Q1 of 2000-01 to Q3 of 2011-12. The analysis was carried out for Non-Food Manufacturing Products (NFMP), various use-based categories and select industries.

Major findings of this study are:

The pricing power has statistically significant, positive and lagged impact on output growth for the NFMP group of companies at the aggregate level.
The impact of declining pricing power on inflation is found to be positive but relatively subdued.
The fall in pricing power is reflected sooner in the moderation of output growth than on inflation.
Among the use-based groups, the impact of pricing power on inflation and output growth is significant and positive only in the case of intermediate goods.

Rupee recovers to 61.48 Vs dollar

 
The rupee was trading up by 11 paise at 61.48 against the dollar at 10.24 a.m. local time on mild dollar selling by banks and exporters.

The rupee opened flat at 61.58 against the American unit, but quickly fell to 61.70 in the first few trades of the day. It had closed at 61.59 against the dollar on Wednesday.

The weakening of US jobs data has led to the belief, among market participants, that the US Fed will further delay the winding down of its $85-billion-a-month fiscal stimulus. Some of this money finds its way to the Indian shores.

The rupee has depreciated over 10 per cent against the American currency from the beginning of the year.

Since economic fundamentals remain wobbly in Asia’s third largest economy, the Indian unit is unlikely to gain substantially till the twin deficits — fiscal and current account deficits — are set right.

Piramal Enterprises reports net loss of Rs 32.26 crore in consolidated Q2

Piramal Enterprises has reported results for the second quarter ended September 30, 2013.

The company has reported net profit of Rs 17.28 crore for the quarter as compared to a net loss of Rs 60.22 crore for the same quarter in the previous year. Total income has increased by 50.25% at Rs 610.49 crore for quarter under review as compared to Rs 406.31 crore for the quarter ended September 30, 2012.

On consolidated basis, the company has reported net loss after taxes, minority interest and share of loss of Associates of Rs 32.26 crore for the quarter as compared to a net loss of Rs 92.02 crore for the same quarter in the previous year. However, total income has increased by 37.60% at Rs 1227.10 crore for quarter under review as compared to Rs 891.80 crore for the quarter ended September 30, 2012.

Punj Lloyd’s arm sells entire 27.78% stake in Olive Group Capital for $20 million

Punj Lloyd’s - Singapore based wholly owned subsidiary of the company has sold its entire shareholding in Olive Group Capital, comprising 27.78% of its capital, for a total consideration of $20 million for a mix of initial and deferred consideration. The deferred consideration of approximately $11 million shall be received with interest thereon. Punj Lloyd Group had invested approximately $14 million in Olive Group.

The company has also been awarded a contract worth Rs 275 crore on cost plus basis, for setting up of various infrastructure facilities including civil, structural, mechanical, electrical & instrumentation, piping, cross country pipelines, horizontal direction drilling, equipment assembly, fabrication and erection, marine work, tankages work and electrical and other associated and miscellaneous works and rectification of defective works at a leading refinery in India.

Punj Lloyd provides engineering, procurement, construction (EPC) and project management services. It provides services to oil and gas, energy, infrastructure petrochemical, telecom broadband and utilities sectors, among others.

BSE Sensex rises over 140 points

Some buying activity is seen in realty, consumer durables, oil & gas, metal, PSU and banking sector, while IT sector is losing sheen on BSE

At 9:36 AM, S&P BSE Sensex is 20,910 up 142 points, while CNX Nifty is at 6,213 up 34 points.

On Wednesday, Sensex closed at 20,767 down 97 points, while Nifty closed at 6,178 down 24 points over the previous close.

BSE Mid-cap is 38 points up at 6,024, while BSE Small-cap is 31 points higher at 5,887.

Some buying activity is seen in realty, consumer durables, oil & gas, metal, PSU and banking sector, while IT sector is losing sheen on BSE.

Bharti Airtel, Hindalco, SSLT, ONGC, RIL, Jindal Steel, Tata Motors and SBI are up on BSE, whereas TCS, Hero MotoCorp, Sun Pharma and Wipro are showing some weakness.

The largely held view on the street is that Indian market is poised to make a new high shortly. That may well turn out to be true. However, the rally could end badly as corporate earnings continue to disappoint, according to Credit Suisse.

In its 'India Market Strategy' report released on Tuesday, Credit Suisse suggests that investors should be booking profits instead of adding to their existing positions.

ACC Ltd is 0.44% down on BSE. The company reported net profit after taxes, minority interest and share of profit of associates of Rs. 1.19 billion for the quarter ended September 30, 2013 as compared to Rs. 2.42 billion for the quarter ended September 30, 2012.

Hero MotoCorp is 0.26% down on BSE. The company posted net profit of Rs. 4.81 billion for the quarter ended September 30, 2013 as compared to Rs. 4.41 billion for the quarter ended September 30, 2012.

Coal India’s follow-on public offer for a 5% stake sale will have to wait till the government appoints seven independent directors on its board, who have retired this year and their positions are yet to be filled up, according to a media report. Coal India is 0.16% up on BSE.

Punj Lloyd plans to divest stake in its non-core assets, list a subsidiary overseas and chase receivables as part of a plan to halve debt to about Rs30bn in a year.

Nikkei is trading 60 points down at 14,365, while Hang Seng is trading 177 points down at 22,822.

Gail rises on inking gas cooperation agreement with Government of Bihar

Gail (India) has signed a Gas Cooperation Agreement (GCA) for Natural Gas Infrastructure and City Gas Distribution with the Department of Industries, Government of Bihar. Under the provisions of the GCA, GAIL and the Bihar Government will evaluate the feasibility for cooperation for the development of the use of eco-friendly fuel, especially natural gas, in the state as well as development of natural gas distribution and city gas infrastructure in identified urban areas and cities after obtaining due authorization from the Petroleum and Natural Gas Regulatory Board (PNGRB).

The company is constructing the 2,050 km Haldia - Jagdishpur pipeline from transmission and distribution of natural gas, of which about 621 km will pass through 14 districts of Bihar. The mainline of the Haldia Jagdishpur will cover 04 districts of Bihar such as Kaimur, Rohtas, Aurangabad, Gaya and 10 districts for the spur lines. GAIL will explore the possibility of City Gas Distribution in major towns of Bihar along this pipeline route.

GAIL and Industries Department, Bihar will also work towards promotion of joint venture for City Gas Distribution projects for domestic, commercial, industrial and transport sectors with the participation of GAIL or its wholly owned subsidiary GAIL Gas and concerned departments of the Bihar Government, other state agencies or private players.

Hero MotoCorp sees first rise in profit in 5 quarters

Company seeing momentum ahead of festive season: CEO & MD Munjal

Hero MotoCorp, the country’s largest two-wheeler maker, on Wednesday reported its first increase in quarterly profits in five quarters.

For the quarter ended September, its net profit stood at Rs 481.41 crore, a rise of 9.3 per cent compared to Rs 440.5 crore in the corresponding period last year. Net sales stood at Rs 5,726.2 crore, against Rs 5,187.4 crore in the year-ago period, a rise of 10.4 per cent.

In the September quarter, Hero MotoCorp’s sales, in terms of volume, increased 6.3 per cent to 14,16,276 units, compared with 13,32,805 units in the corresponding period last year. “These numbers bode well for the festive season. The sentiment is positive and there is momentum for us in the market. We are definitely looking at demonstrating our leadership through record despatches and retail sales during the festive period,” said Pawan Munjal, chief executive officer and managing director, Hero MotoCorp.

Earnings before interest, tax, depreciation and amortisation margin for the September quarter stood at 14.5 per cent. “With our performance in the second quarter of FY14, we have clearly demonstrated we can have good margins, even as we strengthen our market leadership,” Munjal said.

He, however, added the industry continued to face challenges, as the country was passing through difficult times. The rupee depreciation, which adversely impacted several sectors, raised the costs of essential commodities such as steel, nickel, copper and rubber. For Hero MotoCorp, expenses rose 8.9 per cent in the September quarter to Rs 5,180.4 crore, against Rs 4,757.78 crore a year earlier.

“These higher input prices, combined with increasing labour costs, are likely to put a lot of pressure on margins in the industry. We will, therefore, be innovative in tackling these cost pressures to protect our margins,” Munjal said.

HERO MAKES A COMEBACK

* Hero's net profit stood at Rs 481.41 crore, against Rs 440.58 crore last year

* The company’s sales grew 6.3% to 14,16,276 units, compared with 13,32,805 two-wheeler sold last year

* The company says rupee depreciation has raised input costs, putting pressure on margins in the industry

* Hero is looking at demonstrating its leadership by record despatches and sales during festive period