Markets slip ahead of Nov CPI

Markets ended lower as investors turned cautious ahead of the November consumer price inflation data due tomorrow

Markets ended lower on Wednesday, amid a volatile trading session, as investors turned cautious ahead of the consumer price inflation data for November due for release tomorrow. Further, markets shrugged off the November trade data.

The 30-share Sensex ended down 84 points at 21,171 and the 50-share Nifty closed 25 points lower at 6,308.

Snapping a double digit growth trend  for the previous four months, merchandise exports rose just 5.86% at $24.61 billion in November year-on-year despite rupee depreciation. Exports were dragged down by slower growth in refinery, pharmaceutical and gems & jewellery products. Trade deficit came  down by 46.45% at $9.21 billion in November against $17.20 billion a year ago.

Wholesale price inflation rose to 7% in October from 6.46%  in the previous month, where as the rate of price rise in food articles (part  of overall inflation) remained in double digits for the fifth month in a row in October. However, food inflation moderated a bit to 18.19% in October from 18.40% in September.

The rupee snapped its five-day rising streak against the US dollar and fell by 28 paise at 61.32 per dollar in early trade today at the Interbank Foreign Exchange market on fresh dollar demand from importers. The rupee had closed at Rs 61.04 to the dollar on Tuesday.

Besides an increased demand for the dollar from importers, a mixed trend in the American currency against other overseas currencies and weakenss in the domestic equity market also put pressure on the rupee, forex dealers said.

Asian shares ended lower as investors booked profits amid uncertainty over US Fed's bond tapering programme. Shares in Japan were down amid a stronger yen, while profit taking in bank shares pushed Shanghai Composite 1.5% down and Hang Seng ended 1.7% down. The Nikkei ended down 0.6% while Straits Times closed 0.7% lower.

European shares staged a recovery after a flat opening. CAC, DAX and FTSE were up 0.1-0.6% each.

The BSE Capital Goods and Auto indices were among the top losers among the sectoral indices on the BSE down over 1% each. Other losers include, Metal, Oil and Gas indices.

Tata Motors, L&T, TCS, SBI, ONGC, Bharti Airtel and Reliance Ind were among the top losers contributing the most to the Sensex losses.

FMCG major ITC ended up 1% at Rs 321. NTPC rebounded today and ended up 2.4% at Rs 139 after the sharp 11% drop yesterday. The Central Electricity Regulatory Commission (CERC) released draft regulations that will decide the multi-year power tariffs for 2014-2019.

Other Sensex gainers include HDFC which ended up 1.6% and HDFC Bank ended with marginal gains.

Among other shares, Sabero Organic Gujarat has rallied nearly 4% to end at Rs 150, extending its past seven days rally, after the Gujarat Pollution Control Board (GPCB) revoked its closure order of the company’s Sarigam unit for a period of 3 months.

United Breweries ended higher by 2% at Rs 791 after the Dutch liquor giant Heineken hiked its stake in the company by over one percentage point through an open market transaction.

Bharti Infratel gained nearly 4% to end at Rs 185 after Bharti Airtel and Reliance Jio Infocomm announced a comprehensive telecom infrastructure sharing arrangement under which they will share infrastructure created by both parties. Reliance Jio Infocomm is a subsidiary of Reliance Industries Limited (RIL).

Elder Pharmaceutical has surged 11.4% to end at Rs 318 on back of heavy volumes on the bourses. The company said it has been exploring various options to reduce its debt.

The broader market ended mixed, the BSE Mid-cap index ended down 0.1% and the Small-cap index closed 0.1% higher.

Market breadth remained weak with 1,356 losers and 1,134 gainers on the BSE.

Uflex targets to double sales to $2 bn in next four years

Company had reported 19% decline in consolidated net profit at Rs 46 crore for the second quarter ended Sept 30, 2013

Country's largest flexible packaging company Uflex is aiming to double its revenues to $2 billion in the next four years and would set up a new plant in the western region.

"In the next three to four years, we are expecting that our revenue would be doubled. It would jump from $1 billion to $2 billion. That is the target in our mind. It could be in next three or four years, but would be definitely within four years," Uflex Group President R K Jain told PTI.

According to Jain, FY2014-15 would be a 'game changer' for Uflex. "Moreover, a year after that may be extra ordinary for us," he said.

"On a whole, our top line (revenue) is growing by 20% every year, we expect our bottom line (net profit) to grow between 30 to 35%," he added.

The company had reported 19.27% decline in consolidated net profit at Rs 45.7 crore for the second quarter ended September 30, 2013. In the first quarter, which ended on June 30, Uflex's profit dipped to Rs 43 crore.

"This year we call it a recovery year. We are witnessing that every quarter on quarter there is an improvement. That's why we categorise this year as recovery year," Jain said, adding that its expects to do better in second half.

"Once we close this financial year, we should be reaching to a normal stage. For FY 2014-15, we are quite bullish and would operate on a normal basis," he said, adding Uflex would operate on normal margins and product pricing from that year.

"Our top line growth was 15% plus, even in those two years when we have not performed quite well in terms of margins. We expect that this would continue," he said.

The group has invested $160 million to start new plants at Kentucky in USA and Poland to cater the Europe and CIS countries. Apart from that, it has also expanded the production capacity of its plants at Egypt and Mexico. It also has manufacturing base in Dubai.

Uflex has three manufacturing units at Noida, Jammu and Malanpur in Gwalior for producing plastic films and value added products for its packaging business.

"All our plants at Noida and Jammu are running at full capacity. We are moving to a new location because these locations are quite full. We might plan for the western region so that we are much closer to the customer," said Jain.

However, he declined to immediately give details of the location and capacity of the proposed plant.

"We are going to finalise in the next two months about the location, total size, what kind of capacity we are going to create and for what products it would be," Jain added.

Uflex's newly commissioned plant at Kentucky started its operation in March this year. According to Jain, it is one of the biggest plant producing plastic films in the US. It has an installed capacity of 30,000 tonne per annum.

Uflex's market spans over 140 countries. Its client base includes Unilever, Pepsi, Wrigley, Procter & Gamble, Colgate, Palmolive, Nestle, Gillette, Monsanto, HUL, Perfetti and ITC.

Elder Pharma surges on heavy volumes

The stock surged 13% to Rs 322 on BSE on back of over five-fold jump in trading volumes.

Elder Pharmaceutical has surged 13% to Rs 322 in late noon deals on back of heavy volumes on the bourses. The stock of pharmaceutical company has opened at Rs 288 and touched a low of Rs 285 so far on the BSE.

A combined 548,077 shares have changed hands on the counter till 1510 hours against an average less than 100,000 shares that were traded daily in past two weeks on the BSE and NSE.

The company said it has been exploring various options to reduce its debt. The board at its meeting held on July 11, 2013 had already approved the proposal for carrying out restructuring of business involving either raising of capital, hiving off of assets or other strategic options and had decided to appoint advisors for this purpose.

HCL Technologies hits new high

The stock has rallied 86% so far in 2013 as against 9% rise in S&P BSE Sensex and 53% rise BSE IT index.

HCL Technologies has moved higher by over 2% at Rs 1,180, also its new high on the Bombay Stock Exchange (BSE).

The stock of the country's fourth-largest software services provider has outperformed the market by surging 11% in past two weeks compared to 3.3% rise in benchmark S&P BSE Sensex and 4% gain in IT sector index.

HCL Technologies is one of the best performing stocks from the benchmark indices, rallied 86% so far in the current calendar year 2013. The BSE S&P BSE Sensex and IT index has gained 53% and 9% during the same period.

The foreign institutional investors (FIIs) continuously raised their stake in HCL Technologies in past two years. FIIs have hiked their stake in the company to an all-time high of 26.01% in the July-September quarter from 21.8% at the beginning of the 2013. The overseas investors held 18.85% stake at the end of December 2011 quarter.

Meanwhile, The Reserve Bank of India in October allowed HCL Technologies to raise the purchasing limit of shares by FIIs to 49% from 30%.

India Inc strikes deals worth nearly $27 bn in Jan-Nov 2013

Month of Nov witnessed M&A and PE deal activity worth $2 billion

India Inc announced mergers and acquisitions deals worth $1.31 billion in the month of November, taking the 11-month tally this year to $26.76 billion.

According to assurance, tax and advisory firm Grant Thornton, corporates in the country announced 458 deals in the January-November period amounting to $26.76 billion. This was a decline of 21% over the year ago period in value terms.

"The deal activity currently remains moderate, which matches the overall economic sentiment," Grant Thornton India LLP Partner Transaction Advisory Services Raja Lahiri said.

While certain regulatory steps being taken by the government to attract more FDI in sectors such as retail, aviation, broadcasting and telecom are positive signals, the investors, however, are adopting a cautious approach, he said.

"As a result, deal-making is taking longer with more intensive due diligence and evaluation of regulatory risks," he said.

The month of November witnessed M&A and PE deal activity worth $2 billion, which is similar to the levels seen in September and October 2013.

Sector-wise, real estate attracted deals worth $513.23 million -- the largest percentage of the total deal tally in November (39%), followed by IT & ITeS ($225.18 million, 17%), pharma ($193.14 million, 15%), banking and financial ($175.16 million, 13%) and telecom ($80 million, 6%).

The top five M&A deals accounted for 63% of the total deal values.

Lodha Group's acquision of McDonald House for $503 million, was termed as the deal of the month.

IntercontinentalExchange Group Inc's 100% stake acquisition in Singapore Mercantile Exchange for $150 million was the second largest deal, followed by Sanofi Aventis-Shantha Biotechnics deal ($122 million).

The other major transaction for the month of November include SQS Software Quality Systems AG's 100% stake acquisition in Thinksoft Global Services for $24 billion.

ITC trades higher on the bourses

ITC is currently trading at Rs. 320.80, up by 3.05 points or 0.96% from its previous closing of Rs. 317.75 on the BSE.

The scrip opened at Rs. 317.85 and has touched a high and low of Rs. 321.20 and Rs. 317.55 respectively. So far 1,98,000 shares were traded on the counter.

The BSE group 'A' stock of face value Rs. 1 has touched a 52 week high of Rs. 380.00 on 24-Jul-2013 and a 52 week low of Rs. 272.20 on 11-Jan-2013.

Last one week high and low of the scrip stood at Rs. 321.20 and Rs. 307.80 respectively. The current market cap of the company is Rs. 2,54,242 crore.

The institutions and non-institutions held 53.62% and 46.08% stake in the company, respectively.

Diversified conglomerate ITC has launched new range in gold flake cigarette. The new pack of cigarette will be available at Rs 180 per pack of 20.

Recently, the company increased price of Flake Excel Cigarette by Rs 4 per pack of 10, Capstan Cigarette by Rs 5 per pack of 10 and increased Flake Filter Cigarette price by Rs 5 per pack of 10.

ITC, a diversified conglomerate has business interests in cigarettes, hotels, paperboards and specialty papers, packaging, agri-business, packaged foods and confectionery, information technology, branded apparel, personal care, stationery, safety matches and other FMCG products.

Market: Weakness persists amid profit taking

Market participants overlooked better trade deficit figures for the month of November as key indices continued to remain weak in afternoon deals

Markets extended its earlier losses as investors continued to take profits after the recent rally that saw bechmarks kiss new highs.

At 12:54pm, the 30-share BSE Sensex was down 138 points at 21,118 levels and the Nifty was off almost 42 points at 6,292 as weakness in heavyweights persists.

Benchmark Sensex was dragged down primarily by heavyweights such as Tata Motors, ICICI Bank, TCS, L&T and RIL.

The rupee, meanwhile, snapped its five-day rising streak against the American currency fell 30paise to 61.34-a-dollar today at the Interbank Foreign Exchange market on fresh dollar demand from importers.

India's sovereign rating may come under pressure if general elections due by May next year end up with a hung parliament or with a government unable to push through reforms, Standard & Poor's said on Wednesday.

Positive trade deficit figures failed to enthuse even as trade deficit was seen narrowing in the month of December on back of decreased oil, gems & jewellery imports.

Snapping a double digit growth trend  for the previous four months, merchandise exports rose just 5.86 per cent at $24.61 billion in November year-on-year despite rupee depreciation. Exports were dragged down by slower growth in refinery, pharmaceutical and gems & jewellery products.

Not  only exports rose in single digit compared to $23.25 billion in November, 2012, imports also  came down compared to each of  the previous four months of 2012-13, which speaks volumes about  external scenario.

However, the government expressed the hope that exports will see a turnaround  in December again as shut down of some  refineries due to regular maintenance work in November cast a shadow on their outbound shipments.

Besides, international crude oil prices  fell by $5-7 a barrel in November,  which took toll on exports as well, commerce secretary S R Rao said while  releasing trade numbers today.

Rao  further said," cost of  diamonds significantly went  up. So traders did not buy the commodity." However, he said now  the rates have fallen and "we will come back on growth numbers."

The commerce secretary said exports of  pharma products also got affected by domestic regulations on prices  of essential products.

Trade deficit for November stood at $9.23bn against $10.56bn (M-o-M), down 16.3%, on back of lower imports. Trade deficit figures for November were lowest since March 2011.

The focus of the Reserve Bank of India remains on inflation, Governor Raghuram Rajan said on Wednesday, adding growth seems to be stabilising, although it was too early to call a bottom.

Rajan added the rupee had stabilised "somewhat", but said there was no room for complacency. He also called on the government to continue its efforts to contain the fiscal deficit and said raising subsidised diesel prices to market levels would help.

"Our effort is firmly on controlling inflation," Rajan said during a speech to the Delhi Economic Conclave organised by India's Finance Ministry

FMCG remained the only gainer as investors tried to play it safe in a weak market. Oil & gas and banks were the biggest losers among the BSE sectoral indices, falling over 1.4% each.  Banks, realty and auto were the other major losers.

Capital goods stocks such as Pipavav Defence and BHEL were down between 2-5% while L&T is down 1.8 pct .

Broader markets too edged down with small-cap and small-cap indices edging lower by 0.1 - 0.3% on the BSE.

Other shares

Coal India is trading lower by over 2% at Rs 279 in early morning deals on the NSE after the Competition Commission of India (CCI) has imposed a penalty of 1,773 crore over alleged abuse of its monopolistic position.

United Breweries is trading higher by 2% at Rs 793 after the Dutch liquor giant Heineken hiked its stake in the company by over one percentage point through an open market transaction.

Bharti Infratel has surged 7% to Rs 190 on the BSE after Bharti Airtel and Reliance Jio Infocomm announced a comprehensive telecom infrastructure sharing arrangement under which they will share infrastructure created by both parties. Reliance Jio Infocomm is a subsidiary of Reliance Industries Limited (RIL).

Sabero Organic Gujarat has rallied over 8% to Rs 157, extending its past seven days rally, after the Gujarat Pollution Control Board (GPCB) revoked its closure order of the company’s Sarigam unit for a period of 3 months.

Mary Barra appointed General Motors CEO

General Motors named Mary Barra as its new chief executive on Tuesday, making her the first woman to lead a major car manufacturing company in the United States.

The 51-year-old — who previously served as Senior Vice-President for global product development — will replace current CEO Dan Akerson, Detroit-based General Motors (GM) confirmed in a statement.

Akerson is set to step down on January 15 — earlier than originally planned — in order to care for his ill wife. Akerson also serves as Chairman of the board and will be replaced in the role by Theodore (Tim) Solso.

“With an amazing portfolio of cars and trucks and the strongest financial performance in our recent history, this is an exciting time at today’s GM,” Barra said in a statement. “I’m honored to lead the best team in the business and to keep our momentum at full speed.”

Barra has spent 33 years at GM in a variety of manufacturing, engineering, and management positions, beginning as a student intern in 1980. She has served as Senior Vice-President of global product development since 2011 and took on responsibility for GM’s global purchasing and supply chain in 2013.

The announcement comes just one day after the US Government ended its near-five-year run as stockholder in the country’s largest car manufacturer, selling all of its remaining 31.1 million shares in GM.

The Government made a $10 billion ($7.3 billion euro) loss, managing to recoup only $39.9 billion of the original $50 billion stock purchase that bailed out GM in 2009.

Akerson, who took the helm of GM in September 2010, oversaw the gradual reduction of Government-owned shares, and GM’s return to being a publicly traded company.

“My goals as CEO were to put the customer at the center of every decision we make, to position GM for long term success and to make GM a company that America can be proud of again,” Akerson said in a statement. “We are well down that path, and I’m certain that our new team will keep us moving in that direction.”

Lupin trades with traction on the bourses

Lupin is currently trading at Rs. 875.50, up by 3.05 points or 0.35% from its previous closing of Rs. 872.45 on the BSE.

The scrip opened at Rs. 876.00 and has touched a high and low of Rs. 882.90 and Rs. 873.00 respectively. So far 36,000 shares were traded on the counter.

The BSE group 'A' stock of face value Rs. 2 has touched a 52 week high of Rs. 946.35 on 11-Oct-2013 and a 52 week low of Rs. 569.00 on 01-Mar-2013.

Last one week high and low of the scrip stood at Rs. 882.90 and Rs. 851.25 respectively. The current market cap of the company is Rs. 39,222 crore.

The promoters holding in the company stood at 46.78% while Institutions and Non-Institutions held 43.52% and 9.69% respectively.

Pharma Major Lupin (Lupin) has received final approval for its Abacavir Sulfate, Lamivudine, and Zidovudine Tablets, 300 mg (base) / 150 mg / 300 mg from the United States Food and Drugs Administration (FDA) to market a generic version of ViiV Healthcare's (ViiV)Trizivir Tablets, 300 mg (base) / 150 mg / 300mg.

Lupin's Abacavir Sulfate, Lamivudine, and Zidovudine Tablets, 300 mg (base) / 150 mg/ 300 mg is indicated in combination with other antiretrovirals or alone for the treatment of HIV-1 infection. Lupin was the first applicant to file an ANDA for Trizivir Tablets and as such will be entitled to 180 days of marketing exclusivity.

Trizivir Tablets, 300 mg (base) / 150 mg / 300mg had annual U.S sales of approximately $ 111.6 million (IMS MAT Sep, 2013).  

Jindal Steel trades in green on the BSE

Jindal Steel and Power is currently trading at Rs. 272.00, up by 4.50 points or 1.68% from its previous closing of Rs. 267.35 on the BSE.

The scrip opened at Rs. 268.10 and has touched a high and low of Rs. 272.80 and Rs. 265.25 respectively. So far 1, 64,000 shares were traded on the counter.

The BSE group 'A' stock of face value Rs. 1 has touched a 52 week high of Rs. 473.90 on 20-Dec-2012 and a 52 week low of Rs. 181.55 on 02-Aug-2013.

Last one week high and low of the scrip stood at Rs. 289.90 and Rs. 260.00 respectively. The current market cap of the company is Rs. 25,390 crore.

The promoters holding in the company stood at 59.12% while Institutions and Non-Institutions held 27.57% and 13.31% respectively.

Jindal Steel and Power (JSPL) is reportedly planning to add 1800 MW power by end of FY14. With this, the total capacity of the company is expected to be around 2,800 MW by end of financial year 2014. Further, the company is planning to bring down its Debt-Equity ratio in FY15.

Recently, the company raised the prices of steel plates by Rs 500-1000 per tonne. The company also increased prices of rebars by about Rs 1,000 per tonne.

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.

November Trade deficit at $9.2bn

The imports in November are lowest Since March 2011.

November Trade deficit stood at $9.2bn, while April-November trade gap stood at $99.9bn.

November imports was at $33.83bn, while exports were at $24.61bn.

April-November imports stood at $303.9bn

The imports in November are lowest Since March 2011.

NTPC shines on generating 672 million units power in single day

NTPC the largest power generator in the country generated 672.44 Million Units (MUs) with 100.19% Capacity Availability from its coal stations on December 07, 2013, which is the highest daily generation achieved by NTPC coal stations in the current financial year. Total generation (coal + gas) on the day stood at 710.54 MUs, which is also the highest daily generation achieved by the company in the current financial year. Seven out of 16 coal stations achieved 95% PLF on December 7, 2013 out of which three stations achieved 100% PLF.

In 2012-13 NTPC stations achieved gross generation of 232.028 Billion Units (BUs) as against 222.068 BUs in the previous year, registering a growth of 4.49%. With an installed capacity of 42454 MW through 16 coal based, 7 gas based, 2 solar renewable and 7 Joint Venture power stations, NTPC contributes around 28 percent of electricity in the country, with about 19 percent of India's installed capacity.

NTPC is the largest power generating company in the country. It has also diversified into hydro power, coal mining, power equipment manufacturing, oil & gas exploration, power trading & distribution.

Coal India declines as CCI imposes penalty of Rs 1,773 crore

Competition Commission of India (CCI) has imposed a penalty of Rs 1,773 crore on Coal India, the first major penalty on a state-owned company by the fair trade watchdog, for abusing its dominant position in fuel supplies.

The CCI, in its order on December 9, said that Coal India is operating independently of market forces and enjoys an undisputed dominance in the country for production and supply of non-coking coal. The fair trade regulator has also directed the company to cease and desist from anti-competitive practices.

The order came on complaints filed by Maharashtra State Power Generation Company and Gujarat State Electricity Corp against Coal India and three subsidiaries -- Mahanadi Coalfields, Western Coalfields and South Eastern Coalfields.

Coal India, one of India's biggest companies by revenue, has monopoly rights over exploitation of coal reserves. Accounting for more than 80% of domestic production, the company has been facing heavy criticism for not being able to meet demand, forcing those who need the fuel to seek recourse to costly imports.

Fertiliser industry urges govt to allocate Rs 40,000 crore to clear subsidy dues

Concerned over acute liquidity crunch faced by the Indian fertiliser sector, the fertiliser industry has urged the Government to immediately allocate an additional Rs 40,000 crore to clear the subsidy dues for the current fiscal to help resolving the payment crisis faced by the industry. The ministry has pegged the subsidy requirement at Rs 1.07 lakh crore for the current fiscal including the arrears of Rs 32,000 crore out of which the Government had allocated only Rs 65,971 crore subsidy for the current fiscal, marginally lower than the previous year.

Further, the industry has said that the Government should make adequate budgetary allocation for 2014-15 keeping in view the realistic estimate for the current fiscal year and also make provision for providing interest on delayed payment of subsidy and freight bills beyond the prescribed time-limit of 45 days.

Meanwhile, in order to boost the fertilizer sector, the government has taken measures such as banking arrangement of Rs 5,500 crore of which fertiliser companies will get short-term credit from banks at a lower interest rate to partially address the payment crisis. Furthermore, it is also considering an additional Rs 10,000 crore more under the special banking arrangement against the subsidy due for the current year. Regarding the gas availability to fertilizer sector, the government has recently stated that the gas allocation policy will be revised to remove the cap imposed on the supply of domestic gas to fertiliser sector and accorded priority for gas utilisation policy 2008 in order to make new investments in the sector.

LPG price up Rs 3.46 per cylinder due to increase in dealers' commission

The retail price of domestic cooking gas (LPG) has gone up by Rs 3.46 for 14.2-kg cylinder to Rs 40.71 after government raised the commission paid to dealers by over 9% to offset their rising costs such as salary, power and rentals. The development comes two days after Petroleum and Natural Gas minister M Veerappa Moily denied any rise in cooking gas prices.

The increase in commission, which as per practice is passed on to consumers, will increase the cost of LPG in Delhi to Rs 413.96 per 14.2-kg cylinder from Rs 410.50. In addition, dealers’ commission on 5-kg LPG cylinder has been increased by Rs 1.73 to Rs 20.36. A 5-kg LPG cylinder costs Rs. 353 in Delhi currently. The last revision in cooking gas prices happened in October last year when because of an increase in dealers’ commission the rates were raised from Rs 399 per cylinder to Rs 410.50. Dealers' commission on LPG has increased by more than 240% over the past six years - from Rs 16.71 per 14.2-kg LPG cylinder in February 2007 to Rs 40.71 currently.

However, there has been no revision in the additional distributor commission of 75 paisa, paid over and above the normal commission of Rs 40.71, on sale of non-subsidized cylinders. Non-subsidized LPG is sold at market price of Rs 1017.50 per cylinder in Delhi.

Goldman Sachs sells 4.20 lakh shares of Strides Arcolab: Report

Goldman Sachs Investments Mauritius has reportedly offloaded 4.20 lakh shares constituting 0.71% stake of Strides Arcolab through the open market route. The shares were sold on an average price of Rs 876.56 valuing the transaction to Rs 36.82 crore.

Strides Arcolab is a global pharmaceutical company headquartered in Bangalore, India that develops and manufactures wide range of IP-lead niche pharmaceutical products with an emphasis on sterile injectables.

ADB sees India growing 4.7% in 2013

It sees the country growing at 5.7% in 2014

The Asian Development Bank (ADB) on Wednesday kept its growth forecast for India at 4.7% for this year, and sees the country growing at 5.7% in 2014.

The Manila-based bank slightly raised its forecast for China this year and the next, aided by the impact of government reforms and better prospects for key trading partners.

The bank lifted its 2013 forecast for China to 7.7%, from 7.6% in October. It now sees 2014 growth at 7.5% rather than 7.4%.

However, the ADB lowered estimates for Southeast Asia this year and in 2014, in the wake of a strong typhoon in the Philippines and political uncertainties in Thailand.

The bank kept its growth forecast for developing Asia at 6% this year and 6.2% next year.

Rupee weakens to 61.33 in early trade

The rupee snapped its five-day rising streak against the American currency and fell 29 paise at 61.33 per dollar in early trade at the Interbank Foreign Exchange market today on fresh dollar demand from importers.

Besides an increased demand for the dollar from importers, a mixed trend in the American currency against other overseas currencies and a lower opening in the domestic equity market also put pressure on the rupee, forex dealers said.

The rupee had gained 9 paise to close at a four-month high of 61.04 against the dollar in yesterday’s trade on selling of the US currency by exporters and banks amid heavy capital inflows.

Meanwhile, the BSE benchmark Sensex fell 90.4 points or 0.43 per cent at 21,164.86 in early trade today.

FIIs were net sellers of Rs 1277.60 crore in index futures and options segments on December 10

According to the data released by the NSE, the Foreign Institutional Investors (FIIs) were net sellers of Rs 1277.60 crore in index futures and options segments as per Tuesday’s data, December 10, 2013.

FIIs were buyers of index futures to the tune of Rs 183.26 crore and they sold index options worth Rs 1460.86 crore. In the stock segment, FII’s were net sellers of stock futures worth Rs 691.43 crore, while they also sold stock options worth Rs 18.43 crore.           

Heineken increases stake in United Breweries

Heineken International BV has increased its stake in United Breweries. The world’s third largest brewer has acquired an additional 1.3% holding in the Vijay Mallya-led company for $45.8 million or Rs 280 crore.

As on September 30, 2013, Heineken International has a 0.16% stake in United Breweries, while Heineken UK owns a 3.21% stake in the company. Heineken UK obtained the holding due to the terms of an earlier transaction in May this year, wherein United Breweries merged with Scottish & Newcastle India.

United Breweries and Heineken entered into an agreement in 2008 for the latter to be able to sell its beers in India through the former a year ago. Heineken is known for its over 170 international premium, regional, local and specialty beers.

United Breweries is maker of Kingfisher beer and Heineken beer in India. Kingfisher is largest selling beer in India that commands 29% of market share. The company has presence in 52 countries.

Bharti Airtel gains on entering into telecom infrastructure sharing arrangement

Bharti Airtel and Reliance Jio Infocomm have entered into a comprehensive telecom infrastructure sharing arrangement under which they will share infrastructure created by both parties. This will include optic fibre network - inter and intra city, submarine cable networks, towers and internet broadband services and other such opportunities identified in the future. The cooperation is aimed at avoiding duplication of infrastructure, wherever possible, and to preserve capital and the environment. This will also provide redundancy in order to ensure seamless services to customers of the respective parties.

The arrangement could, in future, be extended to Roaming on 2G, 3G and 4G, and any other mutually benefiting areas relating to telecommunication, including but not limited to jointly laying optic fibre or other forms of infrastructure services. The pricing would be at arm’s length, based on the prevailing market rates. As part of this arrangement, Bharti Airtel and Reliance Jio have already announced an agreement under which Bharti Airtel has provided capacity on its i2i submarine cable to Reliance Jio.

Bharti Airtel is a leading integrated telecommunications company with operations in 20 countries across Asia and Africa. The company ranks amongst the top 5 mobile service providers globally in terms of subscribers.

Nifty at 6,300; L&T, Tata Motors down 2%

Following the negative global cues, markets opened in the red with the BSE benchmark index down 65 points at 21,190 and the Nifty gave off 25 points to open close to the 6,300 mark at 6,307.

The ones weighing on the indices in the opening trades were heavyweights like ICICI Bank, Tata Motors, L&T, RIL and ONGC.

The broader markets were relatively flat with the midcap index down 0.2% and the smallcap index flat with a negative bias.

Meanwhile, Asian markets look are traded sideways on Wednesday as investors booked profits on a range of once-crowded positions, sending the dollar and Wall Street lower, while lifting the euro, bonds and gold.

News that U.S. budget negotiators had reached a two-year deal to avoid another government shutdown should be a relief to markets globally, but perhaps not enough to brighten the year-end blues.

Stocks in US were off Tuesday, after a record close on the S&P 500, a day earlier. Traders are now eyeing next week's Federal Reserve meeting for potential cues.

The Dow Jones industrial average ended 0.33% lower, while the S&P 500 Index was down 0.32%. The pan-European FTSEurofirst 300 index fell 0.74%.
Following the negative global cues, markets opened in the red with the BSE benchmark index down 65 points at 21,190 and the Nifty gave off 25 points to open close to the 6,300 mark at 6,307.

The ones weighing on the indices in the opening trades were heavyweights like ICICI Bank, Tata Motors, L&T, RIL and ONGC.

The broader markets were relatively flat with the midcap index down 0.2% and the smallcap index flat with a negative bias.

Meanwhile, Asian markets look are traded sideways on Wednesday as investors booked profits on a range of once-crowded positions, sending the dollar and Wall Street lower, while lifting the euro, bonds and gold.

News that U.S. budget negotiators had reached a two-year deal to avoid another government shutdown should be a relief to markets globally, but perhaps not enough to brighten the year-end blues.

Stocks in US were off Tuesday, after a record close on the S&P 500, a day earlier. Traders are now eyeing next week's Federal Reserve meeting for potential cues.

The Dow Jones industrial average ended 0.33% lower, while the S&P 500 Index was down 0.32%. The pan-European FTSEurofirst 300 index fell 0.74%.

Amid rally, equity mutual fund sales hit a 10-month high

After heavy redemptions in October, retail investors accessing stock markets through this route turned buyers of equities in the run-up to the current rally

Gross sales of mutua
l funds’ equity schemes hit a 10-month high in November. After heavy redemptions in October, retail investors accessing stock markets through MFs turned buyers of equities in the run up to the current rally in the stock markets.

Last month, Rs 5,414 crore of equity sales took place, almost double the average monthly sales thus far this financial year. A big relief for officials in the sector, disappointed for long at the continuously low sales in the segment.

Of the sales mentioned, recent launches of closed-end equity schemes mopped Rs 847 crore; open-ended equity garnered Rs 24 crore. Axis MF, ICICI Prudential AMC and Union KBC were three entities which came with close-ended products in the month.

Gross sales of equity products in September had dipped below Rs 2,000 crore, the first time this had happened in a little over four years. This had sent tremors, particularly among marketing officers in the sector.

However, there are visible signs of improvement. Apart from gross sales, net inflows in equity schemes also moved into positive territory, to a high of Rs 699 crore since June.

In October, when the BSE exchange's benchmark Sensex hit and surpassed 21,000, the sector faced one of its highest levels of redemption, with a net outflow of Rs 3,500 crore. However, despite the indices losing a little over one per cent in November, the sector had positive inflows, amid higher sales.

Equity fund managers sold shares worth Rs 482 crore, a tenth of what they sold in October. "Redemptions tend to force fund managers to sell," says Navneet Munot, chief investment officer at SBI MF. According to him, there are positive signals.

However, the executive vice-president of one of the top 10 fund houses continues to remain cautious. "There is a mix of money flowing into the equity. There is some institutional as well as HNI (high net worth individuals’) money involved, too. I hope this trend sustains."

For, many times in the past, such major inflows have turned out to be aberrations. Though the number of closures of equity folios dipped to 382,000 against 547,000 in October, concern remains that several investors are still trying to exit their investments. Sectoral officials suggest investors continue with their investments and reap the benefits of an expected strong run in the stock markets.

Competition watchdog slaps Rs 1,800-cr fine on CIL

Order based on Mahagenco's petition over abuse of market position by coal miner

The Competition Commission of India (CCI) has slapped Coal India Ltd (CIL) with a penalty of Rs 1,773 crore — the biggest by the watchdog on a company — over alleged abuse of its monopolistic position. The fine comes to roughly three per cent of the Kolkata-headquartered Maharatna company’s average turnover in the past three years

The order was issued on a complaint filed by Maharashtra State Power Generation Company (Mahagenco), which had said the mining entity’s alleged misconduct could be “established” at two levels. One, at the time of executing a contract for coal supply; and two, while implementing the terms of any contract and effecting supply to a beneficiary. The state-owned power generating company, India’s second-largest, had made CIL and its subsidiary, Western Coalfields Ltd (WCL), respondents in the petition.

A spokesperson for CIL said the company had yet to get a copy of the order, while a senior executive said the miner would challenge the order. “It is the order of a trial bench. We will go to the appellate tribunal and, if needed, the Supreme Court. We are confident we have a strong case,” he said. The CIL board is likely to discuss the matter at its next meeting, possibly in the next few days.

“In our petition, we have submitted that CIL’s abuse of dominant position takes place when coal companies become reckless and consistently supply inferior-quality coal to the detriment of purchasers,” Mahagenco Managing Director Subrat Ratho had said, when the petition was filed. The fuel supply agreement (FSA) does not protect a purchaser on the issue of poor quality of coal.

As much as 102,863.38 Mw of electricity generated in the country is based on coal, according to Ratho.

“This is 84 per cent of the country’s total generation capacity,” he added. Mahagenco produces 63.4 per cent of the total amount of electricity generated in Maharashtra. The power producer argues it is not any commercial activity that has helped the country’s top coal companies vest a dominant position in the market. “Rather,” Ratho claimed, “they have acquired it by the virtue of a statutory scheme and the policy of the (Union) government”.

Mahagenco wanted CCI to examine whether the country’s dominant coal companies were abusing their position, and whether the power generators had a resultant prejudice in favour of entities like CIL and WCL.

“The contracts under which coal is supplied has to be examined to protect the interest of power generators and consumers,” Ratho had said. According to the Mahagenco petition, CIL and WCL, both founded in 1975, have “abused their dominant position” to make huge profits at the cost of electricity consumers.