Thursday, 13 February 2014

Sensex, Nifty plunge as IIP shrinks for 3rd straight month

Stock market in India plunged sharply on Thursday. The NSE Nifty managed to close above the psychological 6000 mark. During the day, the Nifty breached the critical level for the first time since February 6, led by heavy selling in scrips across the sectors.

Barring the BSE Realty index all the other major sectoral indices on the BSE ended in the red. Today’s decline was led by the banking, capital goods, oil and gas, power and the healthcare index. 

Sentiment was dampened after the industrial production growth rate remained in the negative zone for the third month in a row, contracting 0.6% in December 2013. The manufacturing segment, which contracted 1.6% during the month, has a weight of over 75% in the index of industrial production (IIP), and has contracted for most part of the current fiscal. On the other hand, Inflation, as per the consumer price index, dropped to 8.79 percent in January from 9.87 percent in December.

Meanwhile, the ruckus in Parliament prolonged, as The Lok Sabha erupted in mayhem on Thursday when a lawmaker fired pepper spray in parliament in protest against a bill on a new Telangana state. 

Finally, BSE Sensex closed at 20,193 down 255 points, while NSE Nifty closed at 6,001 down 83 points over the previous close.

Sun Pharmaceutical Industries reports 74% rise in Q3 consolidated net profit

Sun Pharmaceutical Industries has reported results for third quarter ended December 31, 2013.

The company has reported 15.71% rise in its net profit at Rs 85.88 crore for the quarter as compared to Rs 74.22 crore for the same quarter in the previous year. However, total income of the company  decreased by 16.56% to Rs 759.63 crore for quarter under review as compared to Rs 910.36 crore for the quarter ended December 31, 2012.

On the consolidated basis, the group has reported 73.61% rise in its net profit after taxes and minority interest at Rs 1531.09 crore for the quarter ended December 31, 2013, as compared to Rs 881.30 crore for the same quarter in the previous year. Total income of the group has increased by 51.60% at Rs 4446.82 crore for quarter under review as compared to Rs 2933.33 crore for the quarter ended December 31, 2012.

Hindalco Industries reports 23% fall in Q3 net profit

Hindalco Industries has reported results for third quarter ended December 31, 2013.

The company has reported 22.96% fall in its net profit at Rs 333.98 crore for the quarter, as compared to Rs 433.52 crore for the same quarter in the previous year. However, total income of the company increased marginally by 3.99% at Rs 7477.28 crore for the quarter under review as compared to Rs 7189.80 crore for the quarter ended December 31, 2012.

Hindalco Industries, the metals flagship company of the Aditya Birla Group, is an industry leader in aluminium and copper. The company’s aluminium units across the country encompass the entire gamut of operations from bauxite mining, alumina refining, aluminium smelting to downstream rolling, extrusions, foils and alloy wheels, along with captive power plants and coal mines.

India Inc gives thumbs up to Interim Rail Budget 2014

India Inc has given thumbs up to Interim Rail Budget 2014, wherein no populist measures were announced. Appreciating government's focus on modernization and expansion of the country's vast rail network without touching passenger fares and freight rates, India Inc termed ‘Railway Budget 2014’ - a step in the right direction.

It noted that government’s focus was rightly attracting huge investments to upgrade, modernizing and expanding railways as per aspirations of people and attempting to bring in foreign direct investment (FDI). It further stated that increasing private participation, as rightly noticed by the government, seems to be the way of future development.

In the interim budget for four months in the Lok Sabha, Railway Minister Mallikarjun Kharge announced to set up an independent Rail Tariff Authority to rationalize fares. He also highlighted that there was a proposal to expand dynamic pricing of tickets in line with the airline industry.

Further, the minister announced the launch of 17 new premium trains, 39 express trains and ten passenger trains in the coming year and providing rail connectivity to Katra and Vaishnodevi in Jammu and Kashmir, and Meghalaya and Arunachal Pradesh in the Northeast.

D B Realty gets nod for scheme of amalgamation

D B Realty’s board of directors at its meeting held on February 11, 2014 has approved for the scheme of amalgamation of two of its subsidiaries viz. Gokuldham Real Estate Development Company, a company in which D B Realty holds 74.998% of the paid up capital and Real Gem Buildtech, a wholly owned subsidiary of the Company.

D B Realty is real estate Development Company that focuses on residential, commercial, retail and other projects, such as mass housing and cluster redevelopment, in and around Mumbai.

Eicher Motors climbs on plan to invest Rs 600 crore in Royal Enfield business

Eicher Motors is currently trading at Rs. 4700.95, up by 280.55 points or 6.35% from its previous closing of Rs. 4420.40 on the BSE.

The scrip opened at Rs. 4599.85 and has touched a high and low of Rs. 4884.00 and Rs. 4525.40 respectively. So far 16,000 shares were traded on the counter.

The BSE group 'A' stock of face value Rs. 10 has touched a 52 week high of Rs. 5294.95 on 03-Dec-2013 and a 52 week low of Rs. 2512.00 on 28-Mar-2013.

Last one week high and low of the scrip stood at Rs. 4884.00 and Rs. 4405.00 respectively. The current market cap of the company is Rs. 12,710.00 crore.

The promoters holding in the company stood at 55.12%, while Institutions and Non-Institutions held 25.09% and 19.79% respectively.

Eicher Motors is planning to invest Rs 600 crore in Royal Enfield business. The company would utilize the investment to expand capacity and new products of Royal Enfield. This development is much as per company’s plans of investing Rs 600 crore this year on product development and marketing initiatives.

Additionally, the company, earlier reportedly was eying to increase its market share with the introduction of its Pro series of trucks, which would be rolled out as early as next month.

Eicher Motors is one of the leading manufacturers of commercial vehicle. It has manufacturing facilities located in Madhya Pradesh, Tamil Nadu, Maharashtra, and Haryana.

Ashok Leyland plans to sell prime property in Chennai: Report

Ashok Leyland, the Hinduja group flagship company, is reportedly planning to sell its prime property in Chennai. This is part of a plan involving sale of immovable property to tackle the high debt it is facing, following the slowdown in commercial vehicle sales. The company has put the one-acre property in the Boat Club area in Chennai for sale.

The company is looking to cut debt of Rs 1,000 crore this fiscal and has taken a slew of measures to reduce costs, which include cutting production days to five from six, lay off of 1,300 temporary workers in addition to enforcing a 5% salary cut for the executive cadre and selling stake in non-core subsidiaries.

Ashok Leyland, the Hinduja Group flagship company in India, is engaged in the manufacturing of commercial vehicles and related components. The company’s products include buses, trucks, engines, defense and special vehicles.

ITC plans to set up a production unit: Report

Diversified conglomerate ITC is reportedly planning to set up a production unit in the north-east region for its packaged food items. This new manufacturing unit would be run by the company’s newest 76% subsidiary - North East Nutrients. The manufacturing plant is expected to be ready by the end of 2015.

Recently, the company had acquired 15,200 equity shares of Rs 10 each for cash at par representing 76% of its share capital of North East Nutrients

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.

State Bank of India unveils tax collection service in West Bengal: Report

State Bank of India (SBI), the country’s largest public sector bank has reportedly unveiled commercial tax collection for West Bengal Government at all its 1104 branches. This new tax collection service will work through Government Receipts Portal System (GRIPS), which will be effective at all SBI branches in the State. Moreover, GRIPS will facilitate submitting more than one type of tax at one go, it will ensure faster payment of tax to the Government. 

Currently, commercial taxes, stamp duty, excise duty, state medical exam fees can be deposited through GRIPS. The bank is planning to introduce payment of motor vehicle tax through this route.

State Bank of India has reported 35.07% fall in its net profit at Rs 2375.01 crore for the second quarter ended September 30, 2013 as compared to Rs 3658.14 crore for the same quarter in the previous year. However, total income of the bank has increased by 12.88% at Rs 37199.92 crore for quarter under review as compared to Rs 32953.47 crore for the quarter ended September 30, 2012.

McNally Bharat receives order worth Rs 155 crore

McNally Bharat Engineering Company has received an order for construction works of residential accommodation for an army base for a value of Rs 155.50 crore. Recently, the company had bagged an order worth Rs 118.58 crore for construction works of Super Speciality Hospitals.

McNally Bharat Engineering Company is one of the leading engineering companies. It provides turnkey solutions in areas of power, steel, alumina, material handling, mineral beneficiation, coal washing, ash handling and disposal, port cranes, civic and industrial water supply etc.

Power Grid gets nod for five investment proposals worth Rs 1915 crore

Power Grid Corporation of India (PGCIL) has received an approval for investment proposals worth Rs 1915.01 crore. The board of directors at its meeting held on February 05, 2014 has approved for the same. The first investment approval is for system strengthening in Southern Region - XXII at an estimated cost of Rs 243.53 crore, with commissioning schedule of 30 months from the date of investment approval while the second approval is for sub-station extension works associated with Transmission System required for evacuation of power from Kudgi TPS (3x800 MW In Phase-I) of NTPC at an estimated cost of Rs 167.40 crore, with commissioning schedule of 22 months from the date of investment approval.

The third approval is for Northern Region System Strengthening Scheme - XXX at an estimated cost of Rs 539.82 crore, with commissioning schedule of 28 months from the date of investment approval and the fourth approval is for Northern Region System Strengthening Scheme - XXXII at an estimated cost of Rs 908.08 crore, with commissioning schedule of 28 months from the date of investment approval.

Further, the company has received fifth approval for expansion/up-gradation of SCADA/EMS system of SLDCs of North Eastern Region at an estimated cost of Rs 56.18 crore, with commissioning schedule of 27 months from the date of investment approval.

PGCIL is India’s principal electric power transmission company. It owns and operates most of India’s interstate and inter-regional electric power transmission systems with inter-regional power transfer capacity of about 20,800 MW and wheels nearly 45% of total power generated across India.

Gujarat Mineral Development Corporation reports 27% fall in Q3 net profit

Gujarat Mineral Development Corporation has reported results for third quarter ended December 31, 2013.

The company has reported 26.67% fall in its net profit at Rs 82.29 crore for the quarter, as compared to Rs 112.22 crore for the same quarter in the previous year. Total income of the company decreased by 15.88% at Rs 330.62 crore for quarter under review as compared to Rs 393.05 crore for the quarter ended December 31, 2012.

GMDC is engaged in business of mining and mineral processing. The company manufactures two grades of fluorspar namely acid and metallurgical. It owns two bauxite reserve located at Kutch and Jamnagar.

United Breweries reports 66% rise in Q3 net profit

United Breweries has reported results for third quarter ended December 31, 2013.

The company has reported 65.60% rise in its net profit at Rs 55.51 crore for the quarter, as compared to Rs 33.52 crore for the same quarter in the previous year. Total income of the company increased by 13.69% at Rs 956.80 crore for quarter under review as compared to Rs 841.61 crore for the quarter ended December 31, 2012.

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.

CARE gets nod to raise FII limit up to 74%

Credit Analysis And Research (CARE) has received an approval for increasing the limit of investment by Foreign Institutional Investors (FIIs) including their sub-accounts in the shares or convertible debentures of the company by subscription or acquisition up to 74% of the paid up equity share capital or paid up value of each series of convertible debentures of the company as may be applicable. The board of directors at its meeting held on February 12, 2014 has approved for the same.

CARE is a second largest full service credit rating company in India, offering rating and grading services across a diverse range of instruments and industries including IPO grading, equity grading, and grading of various types of enterprises, including shipyards, maritime training institutes, construction companies and rating of real estate projects, among others.

CCEA approves a subsidy of Rs 3,333 per tonne for exports of raw sugar

Finally giving respite to the ailing sugar industry, the Cabinet Committee on Economic Affairs (CCEA) has approved a subsidy of Rs 3,333 per tonne for exports of raw sugar. The move will boost overseas sales and will help the cash-starved industry to pay arrears to sugarcane farmers.The subsidy fixed at Rs 3,333 per tonne was based on current exchange rate and will be valid for February-March and there will be further revision in April with respect to the then exchange rate. The subsidy will be paid through an escrow account.

Indian Sugar Mills Association (ISMA) reacting to the development has said that though, not much time is left for producing raw sugar in the balance crushing period during this season, but the market sentiments may improve with halt in fall of domestic sugar prices and the most awaithed move will give some of the much required liquidity to the sugar mills.

The sugar industry has been long facing cash crunch due to higher cost of production and lower selling prices in the wake of surplus sugar. The PM had appointed an informal group of ministers in November last year, to look in to the issues of sugarcane farmers. But there were differences between the agriculture and food ministries that forced the CCEA to defer the decision on this matter thrice this month.

Retail inflation in January slows down to two year low of 8.79%

The annual rate of inflation, based on the consumer prices index (CPI) for month of January, 2014 eased more than expected to a 24-month low of 8.79% as against 9.87% in December, aided by moderation in food prices. Meanwhile the corresponding inflation rates (provisional) for Rural and Urban areas stood at 9.43% and 8.09% respectively. The street was widely expecting January month's Retail Inflation to come in at 9.40%.

According the data, all India General (all groups) CPI numbers of January 2014 for Rural, Urban and Combined stood 139.3, 135.0 and 137.4 respectively, While, inflation rates (final) for rural and urban areas for November 2013 stood at 11.66% and 10.53% respectively.

Food prices for consumers rose 9.90 percent last month from a year earlier, much slower than December's 12.16 percent rise. The Provisional annual inflation rates of January 2014 for Rural, Urban and Combined in respect of ‘food and beverages’ stood 10.67%, 8.20% and 9.90% respectively. Additionally, Provisional annual inflation rates (Combined) for Fuel and light; Clothing, bedding and footwear stood at 6.54% and 9.18% respectively. 

However, in a sign of worry, core CPI reportedly came in at 8.11% against the expectation of 8.8%, raising bit of concerns that RBI could yet again hike the interest rates at its April 1 review after surprising investors with a 25 basis points hike last month. The Reserve Bank of India, so far, has raised its benchmark interest rate three times since September in a bid to tame stubbornly high inflation.

Union Bank of India enters into an agreement with Lintas Media Group

Union Bank of India has entered into an agreement with Lintas Media Group for a period of two years from November 01, 2013 to October 31, 2015 for the purpose of developing, planning and implementing media strategy for the bank.

The bank has reported 15.39% rise in its net profit at Rs 348.94 crore for third quarter ended December 31, 2013 as compared to Rs 302.40 crore for the same quarter in the previous year. Total income of the bank has increased by 18.26% at Rs 8230.17 crore for quarter under review as compared to Rs 6959.37 crore for the quarter ended December 31, 2012.

The bank’s gross NPA for the December 31, 2013 quarter of the current fiscal stood at 3.85%, as compared to 3.36% in the same quarter of the previous year. Besides, bank’s Net NPA stood at 2.26% as compared to 1.70% in the same quarter of the previous year.

Unity Infraprojects bags projects worth Rs 364.42 crore

Unity Infraprojects has bagged projects worth Rs 364.42 crore. The company has bagged first order worth Rs 248.58 crore for township package for Kudgi Super Thermal Power Project, Stage -I (3X800MW) by NTPC and the said project is to be completed within a period of 24 months.

The company has bagged second work order worth Rs 115.84 crore for Design, Planning and Construction including supply, delivery, erection, commissioning of mechanical, electrical, instrumentation and automation works and comprehensive operation and maintenance of Storm Water Pumping Station (SWPS) at Britania Outfall, Reti Bunder Bay, Reay Road, Mumbai by Dy. Chief Engineer (Storm Water Drains), PL Cell, Municipal Corporation of Greater Mumbai, Engineering Hub Bldg., Dr. E Moses Road, Mumbai.

Unity Infraprojects is one of the largest civil contractors in India. It is the flagship unit of the Mumbai-based KK Group of Companies, which has its interests spread across a wide spectrum of businesses such as concrete block manufacturing, quarrying, hotel and organized retailing industries.

Markets to make a cautious start reacting to IIP and CPI data

The Indian markets posted gains in last session taking cues from the global markets and ahead of important macro data. Today, the start is likely to be cautious and traders will first react to the mixed set of economic data announced after the market hours. Showing no signs of recovery, Indian industrial production growth rate remained negative for the third straight month, contracting 0.6 per cent in December 2013. However, there was something which could cheer the rate sensitives, as the retail inflation slowed to a two-year low in January to 8.79 percent, its lowest level since January 2012.  Though, core retail inflation remained at around 8 percent, which has been deemed uncomfortably high by the Reserve Bank of India (RBI) governor Raghuram Rajan. Today, the railways related stocks may see some recovery after analyzing the interim budget, India Inc has said that the government’s focus on modernisation and expansion of the country’s vast rail network without touching passenger fares and freight rates was a step in the right direction. Today sugar stocks will be in cheerful mood, as the Cabinet Committee on Economic Affairs (CCEA) a subsidy of Rs 3,333 per tonne for exports of raw sugar to boost overseas sales and help the cash-starved industry to pay arrears to sugarcane farmers.

There will be lots of result announcements to keep the markets buzzing, Ajmera Realty, Alok Inds, Arss Infra Proj, Austral Coke, Bombay Dyeing, Dhampur Sug Mills, Essar Shipping, Future Retail, Hindalco Inds, Hotel Leela and Indian Oil Corp are among the many to announce their numbers today.

The US markets made a mixed closing after a day of good surge; trade remained choppy as traders seemed reluctant to make any significant moves amid a lack of major US economic data. The Asian markets after long gaining streak are showing some sign of weakness and most of the indices in the region are trading in red in early deals, led by the Japanese market which is down by around a percent.

Back home, Indian markets after a gap-up opening just managed to hold their gains for the session on Wednesday. The gains were mainly induced by the cheerful global cues and it missed the further push from the domestic interim rail budget. Though, facing a revenue shortfall, Railway Minister Mallikarjun Kharge in his maiden budget was not expected to make any big-bang announcement, but was expected to make changes in the fuel adjustment component for minimum impact on ticket prices. The extremely short budget presentation, marred by interruptions caused by MPs protesting creation of Telangana remained a non event and most of the railways related stocks turned lower after the budget. Earlier the markets made a good start taking cues from the overnight surge in the US markets, the Asian markets followed the trend and all the major indices posted good gains, European markets too continued their bull run and made a positive start. Back home, the markets more or less remained in upbeat mood throughout the day, some selling was seen soon after the Railway budget, but the markets stabilized after minor hiccups. Railway Minister Mallikarjun Kharge kept passenger fares and freight rates unchanged, introduced 72 new trains and said that train services will also start for Vaishno Devi shrine at Katra in Jammu and Kashmir. He also promised a new tariff-setting body and said work on eastern and western freight corridors was progressing well. However, there was some cautiousness too in the market ahead of the Industrial Production and Consumer price index inflation data. Though, the IIP likely contracted for the second consecutive month in December, on weak manufacturing demand after falling by 2.1 percent in November, traders were mainly eyeing the CPI data, as the RBI’s next policy will majorly depend on it. Sensing some positive news, most of the rate sensitives’ remained in upbeat mood since beginning, though realty ended in red. IT sector, one of the top gainers of last session, added to the gains on industry body Nasscom’s forecast that Indian IT-BPM exports will grow 13-15% in 2014-15 to touch $97- $99 billion. Defensive sectors like FMCG and healthcare took a back seat, while the metal stocks too remained in somber mood since beginning. The non sectoral gauge of sugar came under pressure after Cabinet Committee on Economic Affairs (CCEA), for the third time in row, yet again deferred a decision on subsidy for export of raw sugar on account of unresolved difference between the Agriculture and Food Ministry on quantum of subsidy. Finally, the BSE Sensex surged by 85.12 points or 0.42%, to settle at 20448.49, while the CNX Nifty added 21.30 points or 0.35% to settle at 6,084.00.