DOW NASDAQ down by 3%
Asian Down by more than 2%
Crude hitting New High
INFLATION is all set to come in Double Digit
SGX NIFTY trading at 4136 (-114)
But hope in afternoon trade market will recover on the back of Short Covering and may be by FRESH BUYING
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Friday, June 27, 2008
Thursday, June 26, 2008
Fears rejected for time being
Subscribe now ...............
Nifty (4253) Sup 4150 Res 4315
Rumours going around in the market that Radico Khaitan the maker of 8PM whisky might be an acquistion target. The stock rose more than a 13 percent on 3 times its usual volumes.GHCL, Gujarat Sidhee and Sasken are some of the stocks that look technically strong and would be worth keeping an eye on.
The market seemed to have rejected the exaggerated fears of the RBI move as benchmark indices advanced after a four-day drubbing. But don't accept the gains as a reversal in sentiment as yet. Most of the gains could be attributed to the short-squeeze ahead of the F&O expiry today. Things are not looking too bad for the bulls this morning either. US ended higher (though off the day's highs) after the Federal Reserve left its key rates steady and expressed concern on rising inflation
We expect our markets to follow the global trend and inch further up, driven by further short covering. Having said that, considerable risks still remain in the system due to multi-year high inflation and rising interest rates. The political situation still remains uncertain. So, don't go overboard. May sound too basic but remember to buy at dips and not at bouncy intra-day tops.
FIIs were net sellers of Rs3.64bn (provisional) in the cash segment on Wednesday while the local institutions poured in Rs5.3bn. In the F&O segment, foreign funds were net buyers of Rs1.11bn
Results Today: Allcargo Global, Apar Industries, Cranes Software, Gateway Distriparks, JK Paper, Nitin Fire, Panacea Biotec, Radha Madhav, Religare, Surana Tele, Tata Steel, Tulip Telecom and West Coast Paper
Spice Communications rallied by over 33% to Rs72 after the Board of Directors of the company announces that they have entered into of a share purchase agreement between MCorpGlobal Communications Pvt Ltd and Idea Cellular for the sale of 281,489,350 equity shares of Rs10/- each of the company by MCorpGlobal Communications Pvt to Idea Cellular representing 40.8% of the total paid up equity capital of the company at a price of Rs77.30 per equity share.
The company approved the merger of company with Idea Cellular based on an exchange ratio of 49 equity shares of Idea Cellular for every 100 equity shares of the company held by the shareholders.
The scrip touched an intra-day high of Rs73 and a low of Rs52 and recorded volumes of over 4,00,00,000 shares on NSE.
Shares of Idea Cellular also gained by 3% to Rs102 after the company announced that it would sell 464.7mn shares at Rs156.96 to Telekom Malaysia. The scrip touched an intra-day high of Rs105 and a low of Rs97 and recorded volumes of over 48,00,000 shares on NSE
Cairn India gained by 3% to Rs268 after the company’s unit plans to spend US$2bn to develop oil fields and build a pipeline over 18 months. A project to develop fields in the western state of Rajasthan will cost $850 million. The scrip touched an intra-day high of Rs269 and a low of Rs255 and recorded volumes of over 14,00,000 shares on NSE.
Ranbaxy Labs gained by 4% to Rs545 after the company announced that it received tentative approval from the U.S. Food and Drug Administration to manufacture and market Valganciclovir Hydrochloride Tablets, 450 mg. Total annual market sales for Valganciclovir HCl Tablets were US$239mn (IMS MAT: March 2008). Ranbaxy believes that it has First-to-File status on Valganciclovir tablets, thereby providing a potential of 180-days of marketing exclusivity, offering a significant opportunity in the future.
The scrip touched an intra-day high of Rs548 and a low of Rs518 and recorded volumes of over 8,00,000 shares on NSE.
GMR Infrastructure gained by 3% to Rs99 after the company announced that it would develop 3,200MW of power in India. The company also said that it would spend US$1bn in India over 4-5 years. The scrip touched an intra-day high of Rs102 and a low of Rs94 and recorded volumes of over 29,00,000 shares on NSE.
Reliance Infrastructure surged by 4 percent to Rs948 after reports stated that it secured Rs120bn engineering, procurement and construction (EPC) contract for the 3,960 mw Sasan ultra mega power project (UMPP) of group company Reliance Power.
Reliance Infrastructure will complete the first plant of the 6X660 mw project within 42 months and the remaining five will be commissioned with an interval of three months, stated reports. The scrip touched an intra-day high of Rs959 and a low of Rs876 and recorded volumes of over 8,00,000 shares on NSE.
Nagarjuna Construction fell by 4 percent to Rs146. The company announced that it secured three new orders aggregating Rs3.33bn. The scrip touched an intra-day high of Rs156 and a low of Rs143 and recorded volumes of over 4,00,000 shares on NSE.
News
The Government asks Reliance to supply KG gas first to urea plants, LPG plants and existing power projects. (BL)
Ranbaxy gets tentative USFDA nod for AIDS drug. (BL)
SAIL has affected an increase of 5-8% in all categories of steel from the first week of June for long-term contracts and is contemplating another hike in July last week or beginning August. (FE)
GMR Infrastructure Ltd has acquired 50% stake in Intergen, a power company based at Burlington in the US, for US$1.1bn. (BL)
Reliance Exploration and Production, a subsidiary of RIL has signed a cooperation agreement with the UAE-based petroleum company Crescent Petroleum. (ET)
Nagarjuna Construction has secured three new orders aggregating Rs3.3bn from Maharastra and Karnataka governments. (BL)
Tech Mahindra has inked an US$8mn deal with Telecom Fiji, subsidiary of Amalgamated Telecom Holdings. (ET)
NTPC to set up 4,000MW power plant in UP. (ET)
SBI to raise its lending rates by 50 basis points post RBI’s move to hike both CRR and repo rate by 50 basis points. (FE)
Reliance Infra has inked a partnership with US consultant Black & Veatch. (ET)
PSL Ltd announced that its order book stands at about Rs40bn. (ET)
Bangalore International Airport Ltd is seeking a valuation of up to US$2.5bn to raise about US$200mn in equity to fund the second phase of the airport’s development. (ET)
Birla Cotsyn (India) plans to raise about Rs1.4bn through an IPO. (ET)
IndusInd Bank raises Rs2.2bn through GDR issue. (BL)
Apollo Hospitals Enterprise Ltd intends to spin off its pharma retailing business into a separate company. (BL)
Mt Everest mineral water is fighting a legal battle with Bisleri International over the use of the word Himalaya in its mineral water branding. (ET)
Amtek Auto through its subsidiary Amtek Transportation Systems Ltd has signed a JV agreement with American Railcar Industries Inc based in St Charles, Missouri. (BL)
Wipro received marketing-related intangible assets valued at Rs4.9bn from the brands of Singapore-based FMCG Company Unza which it acquired last year. (ET)
ITC Infotech to pull out of its BPO equal joint venture with US-based Sitel Corporation. (BS)
Mauritius-based Frontline Strategy’s private equity fund bought a stake of 26% in Shriram SEPL Composites, a JV between Shriram EPC and Strategic Engineering. (BS)
GoAir plans to offload 26% stake. (ET)
Reva Electric Car Company is looking at licensing its vehicle technology to other carmakers. (ET)
Hindustan Copper Ltd has applied to the government of Madhya Pradesh for reconnaissance permit for an area of 1,600 sq km in the district of Balaghat. (FE)
HTMT Global to buy BPO co in Europe. (BL)
Economic News
The Centre plans to increase the credit exposure limit of 15% on bank lending to NBFCs for infrastructure projects, especially in the power sector. (FE)
The government’s direct tax collection increased by 43.5% to Rs494bn until June 21, on the back of higher advance tax payments by Companies. (FE)
The Indian Railways is hiking freight charges for ores and minerals, petro-products, coke and coal, fertilizers, foodgrains and a host of other commodities by 5-7%. (BL)
The Federation of All India Petroleum Traders has warned that petrol pumps across the country may go dry in the next 15 days if the government does not resolve the issues concerning sale of branded fuel. (ET)
The government is yet to decide the floor price at which it will purchase key kharif crops. (ET)
Airport operators are unlikely to cut landing and parking fees for airlines. (ET)
Auto parts suppliers to cut supplies to OEMs in the next quarter.
Nifty (4253) Sup 4150 Res 4315
Rumours going around in the market that Radico Khaitan the maker of 8PM whisky might be an acquistion target. The stock rose more than a 13 percent on 3 times its usual volumes.GHCL, Gujarat Sidhee and Sasken are some of the stocks that look technically strong and would be worth keeping an eye on.
The market seemed to have rejected the exaggerated fears of the RBI move as benchmark indices advanced after a four-day drubbing. But don't accept the gains as a reversal in sentiment as yet. Most of the gains could be attributed to the short-squeeze ahead of the F&O expiry today. Things are not looking too bad for the bulls this morning either. US ended higher (though off the day's highs) after the Federal Reserve left its key rates steady and expressed concern on rising inflation
We expect our markets to follow the global trend and inch further up, driven by further short covering. Having said that, considerable risks still remain in the system due to multi-year high inflation and rising interest rates. The political situation still remains uncertain. So, don't go overboard. May sound too basic but remember to buy at dips and not at bouncy intra-day tops.
FIIs were net sellers of Rs3.64bn (provisional) in the cash segment on Wednesday while the local institutions poured in Rs5.3bn. In the F&O segment, foreign funds were net buyers of Rs1.11bn
Results Today: Allcargo Global, Apar Industries, Cranes Software, Gateway Distriparks, JK Paper, Nitin Fire, Panacea Biotec, Radha Madhav, Religare, Surana Tele, Tata Steel, Tulip Telecom and West Coast Paper
Spice Communications rallied by over 33% to Rs72 after the Board of Directors of the company announces that they have entered into of a share purchase agreement between MCorpGlobal Communications Pvt Ltd and Idea Cellular for the sale of 281,489,350 equity shares of Rs10/- each of the company by MCorpGlobal Communications Pvt to Idea Cellular representing 40.8% of the total paid up equity capital of the company at a price of Rs77.30 per equity share.
The company approved the merger of company with Idea Cellular based on an exchange ratio of 49 equity shares of Idea Cellular for every 100 equity shares of the company held by the shareholders.
The scrip touched an intra-day high of Rs73 and a low of Rs52 and recorded volumes of over 4,00,00,000 shares on NSE.
Shares of Idea Cellular also gained by 3% to Rs102 after the company announced that it would sell 464.7mn shares at Rs156.96 to Telekom Malaysia. The scrip touched an intra-day high of Rs105 and a low of Rs97 and recorded volumes of over 48,00,000 shares on NSE
Cairn India gained by 3% to Rs268 after the company’s unit plans to spend US$2bn to develop oil fields and build a pipeline over 18 months. A project to develop fields in the western state of Rajasthan will cost $850 million. The scrip touched an intra-day high of Rs269 and a low of Rs255 and recorded volumes of over 14,00,000 shares on NSE.
Ranbaxy Labs gained by 4% to Rs545 after the company announced that it received tentative approval from the U.S. Food and Drug Administration to manufacture and market Valganciclovir Hydrochloride Tablets, 450 mg. Total annual market sales for Valganciclovir HCl Tablets were US$239mn (IMS MAT: March 2008). Ranbaxy believes that it has First-to-File status on Valganciclovir tablets, thereby providing a potential of 180-days of marketing exclusivity, offering a significant opportunity in the future.
The scrip touched an intra-day high of Rs548 and a low of Rs518 and recorded volumes of over 8,00,000 shares on NSE.
GMR Infrastructure gained by 3% to Rs99 after the company announced that it would develop 3,200MW of power in India. The company also said that it would spend US$1bn in India over 4-5 years. The scrip touched an intra-day high of Rs102 and a low of Rs94 and recorded volumes of over 29,00,000 shares on NSE.
Reliance Infrastructure surged by 4 percent to Rs948 after reports stated that it secured Rs120bn engineering, procurement and construction (EPC) contract for the 3,960 mw Sasan ultra mega power project (UMPP) of group company Reliance Power.
Reliance Infrastructure will complete the first plant of the 6X660 mw project within 42 months and the remaining five will be commissioned with an interval of three months, stated reports. The scrip touched an intra-day high of Rs959 and a low of Rs876 and recorded volumes of over 8,00,000 shares on NSE.
Nagarjuna Construction fell by 4 percent to Rs146. The company announced that it secured three new orders aggregating Rs3.33bn. The scrip touched an intra-day high of Rs156 and a low of Rs143 and recorded volumes of over 4,00,000 shares on NSE.
News
The Government asks Reliance to supply KG gas first to urea plants, LPG plants and existing power projects. (BL)
Ranbaxy gets tentative USFDA nod for AIDS drug. (BL)
SAIL has affected an increase of 5-8% in all categories of steel from the first week of June for long-term contracts and is contemplating another hike in July last week or beginning August. (FE)
GMR Infrastructure Ltd has acquired 50% stake in Intergen, a power company based at Burlington in the US, for US$1.1bn. (BL)
Reliance Exploration and Production, a subsidiary of RIL has signed a cooperation agreement with the UAE-based petroleum company Crescent Petroleum. (ET)
Nagarjuna Construction has secured three new orders aggregating Rs3.3bn from Maharastra and Karnataka governments. (BL)
Tech Mahindra has inked an US$8mn deal with Telecom Fiji, subsidiary of Amalgamated Telecom Holdings. (ET)
NTPC to set up 4,000MW power plant in UP. (ET)
SBI to raise its lending rates by 50 basis points post RBI’s move to hike both CRR and repo rate by 50 basis points. (FE)
Reliance Infra has inked a partnership with US consultant Black & Veatch. (ET)
PSL Ltd announced that its order book stands at about Rs40bn. (ET)
Bangalore International Airport Ltd is seeking a valuation of up to US$2.5bn to raise about US$200mn in equity to fund the second phase of the airport’s development. (ET)
Birla Cotsyn (India) plans to raise about Rs1.4bn through an IPO. (ET)
IndusInd Bank raises Rs2.2bn through GDR issue. (BL)
Apollo Hospitals Enterprise Ltd intends to spin off its pharma retailing business into a separate company. (BL)
Mt Everest mineral water is fighting a legal battle with Bisleri International over the use of the word Himalaya in its mineral water branding. (ET)
Amtek Auto through its subsidiary Amtek Transportation Systems Ltd has signed a JV agreement with American Railcar Industries Inc based in St Charles, Missouri. (BL)
Wipro received marketing-related intangible assets valued at Rs4.9bn from the brands of Singapore-based FMCG Company Unza which it acquired last year. (ET)
ITC Infotech to pull out of its BPO equal joint venture with US-based Sitel Corporation. (BS)
Mauritius-based Frontline Strategy’s private equity fund bought a stake of 26% in Shriram SEPL Composites, a JV between Shriram EPC and Strategic Engineering. (BS)
GoAir plans to offload 26% stake. (ET)
Reva Electric Car Company is looking at licensing its vehicle technology to other carmakers. (ET)
Hindustan Copper Ltd has applied to the government of Madhya Pradesh for reconnaissance permit for an area of 1,600 sq km in the district of Balaghat. (FE)
HTMT Global to buy BPO co in Europe. (BL)
Economic News
The Centre plans to increase the credit exposure limit of 15% on bank lending to NBFCs for infrastructure projects, especially in the power sector. (FE)
The government’s direct tax collection increased by 43.5% to Rs494bn until June 21, on the back of higher advance tax payments by Companies. (FE)
The Indian Railways is hiking freight charges for ores and minerals, petro-products, coke and coal, fertilizers, foodgrains and a host of other commodities by 5-7%. (BL)
The Federation of All India Petroleum Traders has warned that petrol pumps across the country may go dry in the next 15 days if the government does not resolve the issues concerning sale of branded fuel. (ET)
The government is yet to decide the floor price at which it will purchase key kharif crops. (ET)
Airport operators are unlikely to cut landing and parking fees for airlines. (ET)
Auto parts suppliers to cut supplies to OEMs in the next quarter.
Wednesday, June 25, 2008
Eye ranbaxy at lower levels for buying
Today, Nifty has support at 4,069 and 4005 and resistance at 4,262 and BSE Sensex has support at 13,635 and resistance at 14,352.
Sell Jet Airways (518) SL 523 Target 508, 504
Sell RCom (474) SL 481
Target 464, 460
Sell Yes Bank (136) SL 140
Target 126, 123
Sell DLF (440) SL 447
Target 427, 424
Sell Titan (1019) SL 1034
Target 989, 980
The Indian Market is expected to have negative opening on the back of weak global cues, political uncertainty and rates hike by RBI. Tuesday, the Indian market closed in red for the fifth straight trading day backed by selling across the ground. The BSE Sensex fall below the 14,000 mark for the first time since late August 2007
Investors will have eye on the crucial meeting of the members of UPA with left scheduled today to decide on the fate of proposed deal between the Congress party and the U.S. President. Left parties had threatened to withdraw support if the government went ahead with the deal.
RBI on Tuesday raised its key lending rate and the CRR by 50 basis points each to tame inflation that hit a 13-year high early in June. As a second increase this month in its repo rate, the RBI raised the key lending rate to 8.5% from 8.0% with immediate effect. RBI will raise the cash reserve ratio to 8.75% from 8.25% in two stages, to 8.5% from July 5 and to 8.75% from July 19. These hikes will have adverse implications for the manufacturing sector, which have impact of high interest rates.
Today's Pick - Chambal Fertilisers
We recommend a sell in Chambal Fertilisers & Chemicals from a short-term perspective. From the charts to the stock we note that it had been on a medium-term uptrend from its March 2008 low of Rs 41, till it encountered resistance at Rs 94 in mid June.
The reversal from Rs 94 level has been supported by negative divergence in the daily moving-average convergence and divergence (MACD).
Recently, the stock penetrated the 21-day moving average and the medium-term up trendline, signalling bearishness. The daily MACD has displayed negative divergence and is indicating a sell.
The other daily momentum indicators are declining in the neutral region towards the bearish zone. Our short-term forecast for the stock is negative. We anticipate the stock’s down move to continue until it hits our price target of Rs 66 in the upcoming trading sessions. Traders with short-term perspective can sell the stock while maintaining stop-loss at Rs 79
For the time being there is no fear of the unknown. The RBI has done what he can and we haven’t seen the last of hikes as yet. Just the other day the RBI governor Dr. Reddy had hinted at a "calibrated" approach to control inflation.In what seems to be a desperate political move to reign in inflation, the RBI has hiked both the repo rate and the CRR by half a percentage points each. We hear that a section of the market was perhaps aware of something like this in the offing. That explains the sharp fall yesterday in the last half an hour. The bloodbath may continue, at least at the start today.
On the political front, expect lots of voices from New Delhi as the UPA-Left panel on the Indo-US nuke deal meets today. Both sides may try and hammer out some compromise formula, as nobody wants an early election. The market may benefit if the outcome of the meet is definite. Any further uncertainty on this front will hit market sentiment. One will have to see which way the dice rolls. As far as global markets are concerned, there hasn't been any major fall, though the undertone remains precarious amid fresh worries over the financial sector and near-record crude oil prices.
Coming back to our market, banking, realty and auto stocks will bear the brunt of the selling pressure. Others like capital goods, construction and consumer-centric sectors may also decline. This doesn't mean stocks in the rest of the sectors will be any better off. Overall, we expect a gap-down opening. However, things may stabilise a wee bit as FIIs weren't big sellers yesterday and globally things are not that bad.
Much of the action today will be seen in the F&O segment, where most indicators are pointing to further weakness. For the Nifty, 4200 was seen as a big support. But, that has been broken. Most traders are net short. With F&O expiry tomorrow, Fed announcement (nothing much is expected) later today, and the UPA-Left meet, the bulls have their task cut out. Expect high volatility as has been the case in the last two days. In these turbulent and uncertain times, like we mentioned yesterday pick up the better counters available at rates you once asked for!.
FIIs were net buyers of Rs900.6mn (provisional) in the cash segment on Tuesday while the local institutions poured in Rs4.76bn. In the F&O segment, foreign funds were net sellers of Rs10.86bn
Volatility to prevail
A highly volatile session ended in negative terrain for fifth straight day on back of weak global cues coupled with al round selling in scrips across the sectors. Markets closed at days low and Nifty closed below the 4,000 mark for first time since Aug 24 2007.
The fall could be attributed to heavy selling in index heavyweights like Infosys, L&T and Tata Steel. However, bucking the negative trend were, Reliance Industries, HDFC and BHEL.
All the key Sectoral indices also ended in red, the BSE Metal index was the biggest loser, (down 3.5%), other like BSE PSU index (down 2.8%), BSE FMCG index (down 2.5%) and BSE IT index (down 2.1%).
Among the 50-Nifty, 41 stocks ended in negative terrain and only 9 stocks ended in green. Finally, the BSE benchmark Sensex lost 186 points to close at 14,106 and the Nifty index lost 75 points to close at 4,191.
TCS ended lower by 1.6% at Rs843. The company won a transformational engagement from the Uganda Revenue Authority (URA) to design and implement integrated tax administration system. The new system will manage all domestic domestic taxes and duties for the URA including income tax, value-added tax, witholding tax and other excise duties.
It will help the URA increase the level of tax compliance in the country, broaden the tax base and provide effecient service to Uganda's tax payers. The scrip touched an intra-day high of Rs864 and a low of Rs823 and recorded volumes of over 3,00,000 shares on BSE.
S.Kumars Nationwide gained by 0.5% to Rs106 after the company said that GIC SI would invest Rs9bn in Reid & Taylor through a fresh issue of shares and warrants. Post-conversion, GIC SI would own 25.4% of Reid & Taylor, valuing it at Rs35.40bn. The company will own 74.6% of Reid & Taylor (India) Ltd post the investment from GIC SI.
The scrip touched an intra-day high of Rs108 and a low of Rs105 and recorded volumes of over 1,00,000 shares on BSE.
Torrent Pharma rallied by over 12% to Rs174 after the company announced that it denied reports that the company’s founders would sell stake to Sun Pharma. The scrip touched an intra-day high of Rs182 and a low of Rs158 and recorded volumes of over 7,00,000 shares on BSE.
Orchid Chemicals declined by 4.7% to Rs225. The company announced that it received approval from the Canadian TPD for ANDS (Abbreviated New Drug Submission) for Piperacillin and Tazobactam for Injection.
The scrip touched an intra-day high of Rs243 and a low of Rs224 and recorded volumes of over 9,00,000 shares on BSE.
NIIT Ltd gained by 2.5% to Rs104 after the company announced that the company has entered into a strategic alliance with Infospectrum to offer proven Educational Resource Planning Solutions". The scrip touched an intra-day high of Rs105 and a low of Rs101 and recorded volumes of over 90,000 shares on BSE.
Binani Industries was down 1.2% to Rs106. The Board of Directors of the Company at its meeting held on June 23, 2008, approved the enhancement of guarantee limits from Rs16bn to Rs40bn. The scrip touched an intra-day high of Rs110 and a low of Rs106 and recorded volumes of over 3,000 shares on BSE.
Sagar Cements gained by a over 3 percent to Rs388 after the company announced that the Board of Directors at its meeting held on June 23, 2008, has decided to implement a green field cement plant of 5.5mn ton capacity in Gulbarga District in Karnataka through a special purpose vehicle to be jointly promoted with M/s. Vicat S.A., France.
To mobilize a sum of Rs700mn through issue of 10,00,000 equity shares of Rs10/- each at a premium of Rs690/- per share on a preferential basis to M/s. Vicat S.A., France, its affiliates and subsidiaries. The scrip touched an intra-day high of Rs394 and a low of Rs375 and recordede volumes of over 1,00,000 shares on BSE.
Jain Irrigation ended 2% lower to close at Rs469. The company announced that it secured contract worth Rs227.7mn. The scrip touched an intra-day high of Rs480 and a low of Rs461 and recorded volumes of over 16,00,000 shares on BSE.
Corporate News
Suzlon Energy is partnering Bahrain-based PE firm Arcapita to bid for Chinese alternative energy Company, Honiton Energy Holdings estimated at US$400mn (ET)
GMR Group is likely to buy 50% stake in US-based power generation firm InterGen in a deal valued at US$1.2bn (ET)
GIC Special Investments to acquire 25.4% stake in S Kumars’ Reid & Taylor brand for Rs9bn (ET)
HDIL buys 51% stake in Broadcast Initiatives, a Sri Adhikari Bros Group controlled media firm for an undisclosed amount (ET)
Reliance Infra bags Rs120bn EPC order from R Power to develop Shashun UMPP (BS)
Tata Group has increased stake in its South African Telecom Venture Neotel by 30% to 56% (ET)
TCS has won a contract worth US$11.5mn from Uganda Revenue Authority (ET)
Information & Broadcasting Ministry has asked DoT to initiate action against Bharti Airtel for launching IPTV services without requisite approvals (ET)
Jindal Saw is planning to set up a ship building & repair hub in Gujarat with an investment of over US$2bn (ET)
RIL and Essar Oil have agreed to buy entire crude oil from Cairn India’s Rajasthan block and are negotiating prices (ET)
ADAG Group is set to launch 24-hour FM radio station in Singapore in collaboration with local station MediaCorp Radio (ET)
Tech Mahindra has bagged a US$7.6mn deal with telecom Fiji Ltd (BL)
RIL signs an agreement with UAE-based, Crescent Petroleum Company to jointly develop oil & gas projects in Middle East (DNA)
Jet Airways and Kingfisher Airlines are moving towards zero commission structure for travel agents (ET)
IndusInd Bank has raised Rs2.2bn from the overseas market through fresh issue of shares (ET)
Vicat buys 6.67% stake in Sagar Cements for Rs700mn at Rs700/share (BS)
ICICI Ventures may list US$1.5bn realty fund on the London Stock Exchange (BS)
Essar Shipping is planning to set up ports in Brazil, China and Vietnam (ET)
IndusInd Bank hikes PLR by 50bps (BS)
NIIT has signed an agreement with Infospectrum to market latter’s customizable Educational Resource Planning solutions in schools (BL)
Nilkamal to invest Rs1.5bn to develop retail stores in India (FE)
Essar Shipping arm lines up Rs100bn expansion plans for third party logistics (DNA)
Tata Chemical to spend Rs5bn to de-bottleneck and modernized its plant in current fiscal (DNA)
Economic News
RBI hikes repo rate by 50bps with immediate effect and raises CRR by 50bps in two stages (ET)
Exports grew by 2.9% in FY08 to US$155.4bn (ET)
Car makers to increase prices by Rs,6000-Rs30,000 across models (BS)
CBDT has raised Direct Tax collection target for FY09 to Rs3.95trn (BL)
Cement prices may to increase by Rs3-5 per bag from 1st July in Bombay (FE)
RBI pumps in Rs387bn through repo window (FE)
Planning Commission says 9% growth is possible
Sell Jet Airways (518) SL 523 Target 508, 504
Sell RCom (474) SL 481
Target 464, 460
Sell Yes Bank (136) SL 140
Target 126, 123
Sell DLF (440) SL 447
Target 427, 424
Sell Titan (1019) SL 1034
Target 989, 980
The Indian Market is expected to have negative opening on the back of weak global cues, political uncertainty and rates hike by RBI. Tuesday, the Indian market closed in red for the fifth straight trading day backed by selling across the ground. The BSE Sensex fall below the 14,000 mark for the first time since late August 2007
Investors will have eye on the crucial meeting of the members of UPA with left scheduled today to decide on the fate of proposed deal between the Congress party and the U.S. President. Left parties had threatened to withdraw support if the government went ahead with the deal.
RBI on Tuesday raised its key lending rate and the CRR by 50 basis points each to tame inflation that hit a 13-year high early in June. As a second increase this month in its repo rate, the RBI raised the key lending rate to 8.5% from 8.0% with immediate effect. RBI will raise the cash reserve ratio to 8.75% from 8.25% in two stages, to 8.5% from July 5 and to 8.75% from July 19. These hikes will have adverse implications for the manufacturing sector, which have impact of high interest rates.
Today's Pick - Chambal Fertilisers
We recommend a sell in Chambal Fertilisers & Chemicals from a short-term perspective. From the charts to the stock we note that it had been on a medium-term uptrend from its March 2008 low of Rs 41, till it encountered resistance at Rs 94 in mid June.
The reversal from Rs 94 level has been supported by negative divergence in the daily moving-average convergence and divergence (MACD).
Recently, the stock penetrated the 21-day moving average and the medium-term up trendline, signalling bearishness. The daily MACD has displayed negative divergence and is indicating a sell.
The other daily momentum indicators are declining in the neutral region towards the bearish zone. Our short-term forecast for the stock is negative. We anticipate the stock’s down move to continue until it hits our price target of Rs 66 in the upcoming trading sessions. Traders with short-term perspective can sell the stock while maintaining stop-loss at Rs 79
For the time being there is no fear of the unknown. The RBI has done what he can and we haven’t seen the last of hikes as yet. Just the other day the RBI governor Dr. Reddy had hinted at a "calibrated" approach to control inflation.In what seems to be a desperate political move to reign in inflation, the RBI has hiked both the repo rate and the CRR by half a percentage points each. We hear that a section of the market was perhaps aware of something like this in the offing. That explains the sharp fall yesterday in the last half an hour. The bloodbath may continue, at least at the start today.
On the political front, expect lots of voices from New Delhi as the UPA-Left panel on the Indo-US nuke deal meets today. Both sides may try and hammer out some compromise formula, as nobody wants an early election. The market may benefit if the outcome of the meet is definite. Any further uncertainty on this front will hit market sentiment. One will have to see which way the dice rolls. As far as global markets are concerned, there hasn't been any major fall, though the undertone remains precarious amid fresh worries over the financial sector and near-record crude oil prices.
Coming back to our market, banking, realty and auto stocks will bear the brunt of the selling pressure. Others like capital goods, construction and consumer-centric sectors may also decline. This doesn't mean stocks in the rest of the sectors will be any better off. Overall, we expect a gap-down opening. However, things may stabilise a wee bit as FIIs weren't big sellers yesterday and globally things are not that bad.
Much of the action today will be seen in the F&O segment, where most indicators are pointing to further weakness. For the Nifty, 4200 was seen as a big support. But, that has been broken. Most traders are net short. With F&O expiry tomorrow, Fed announcement (nothing much is expected) later today, and the UPA-Left meet, the bulls have their task cut out. Expect high volatility as has been the case in the last two days. In these turbulent and uncertain times, like we mentioned yesterday pick up the better counters available at rates you once asked for!.
FIIs were net buyers of Rs900.6mn (provisional) in the cash segment on Tuesday while the local institutions poured in Rs4.76bn. In the F&O segment, foreign funds were net sellers of Rs10.86bn
Volatility to prevail
A highly volatile session ended in negative terrain for fifth straight day on back of weak global cues coupled with al round selling in scrips across the sectors. Markets closed at days low and Nifty closed below the 4,000 mark for first time since Aug 24 2007.
The fall could be attributed to heavy selling in index heavyweights like Infosys, L&T and Tata Steel. However, bucking the negative trend were, Reliance Industries, HDFC and BHEL.
All the key Sectoral indices also ended in red, the BSE Metal index was the biggest loser, (down 3.5%), other like BSE PSU index (down 2.8%), BSE FMCG index (down 2.5%) and BSE IT index (down 2.1%).
Among the 50-Nifty, 41 stocks ended in negative terrain and only 9 stocks ended in green. Finally, the BSE benchmark Sensex lost 186 points to close at 14,106 and the Nifty index lost 75 points to close at 4,191.
TCS ended lower by 1.6% at Rs843. The company won a transformational engagement from the Uganda Revenue Authority (URA) to design and implement integrated tax administration system. The new system will manage all domestic domestic taxes and duties for the URA including income tax, value-added tax, witholding tax and other excise duties.
It will help the URA increase the level of tax compliance in the country, broaden the tax base and provide effecient service to Uganda's tax payers. The scrip touched an intra-day high of Rs864 and a low of Rs823 and recorded volumes of over 3,00,000 shares on BSE.
S.Kumars Nationwide gained by 0.5% to Rs106 after the company said that GIC SI would invest Rs9bn in Reid & Taylor through a fresh issue of shares and warrants. Post-conversion, GIC SI would own 25.4% of Reid & Taylor, valuing it at Rs35.40bn. The company will own 74.6% of Reid & Taylor (India) Ltd post the investment from GIC SI.
The scrip touched an intra-day high of Rs108 and a low of Rs105 and recorded volumes of over 1,00,000 shares on BSE.
Torrent Pharma rallied by over 12% to Rs174 after the company announced that it denied reports that the company’s founders would sell stake to Sun Pharma. The scrip touched an intra-day high of Rs182 and a low of Rs158 and recorded volumes of over 7,00,000 shares on BSE.
Orchid Chemicals declined by 4.7% to Rs225. The company announced that it received approval from the Canadian TPD for ANDS (Abbreviated New Drug Submission) for Piperacillin and Tazobactam for Injection.
The scrip touched an intra-day high of Rs243 and a low of Rs224 and recorded volumes of over 9,00,000 shares on BSE.
NIIT Ltd gained by 2.5% to Rs104 after the company announced that the company has entered into a strategic alliance with Infospectrum to offer proven Educational Resource Planning Solutions". The scrip touched an intra-day high of Rs105 and a low of Rs101 and recorded volumes of over 90,000 shares on BSE.
Binani Industries was down 1.2% to Rs106. The Board of Directors of the Company at its meeting held on June 23, 2008, approved the enhancement of guarantee limits from Rs16bn to Rs40bn. The scrip touched an intra-day high of Rs110 and a low of Rs106 and recorded volumes of over 3,000 shares on BSE.
Sagar Cements gained by a over 3 percent to Rs388 after the company announced that the Board of Directors at its meeting held on June 23, 2008, has decided to implement a green field cement plant of 5.5mn ton capacity in Gulbarga District in Karnataka through a special purpose vehicle to be jointly promoted with M/s. Vicat S.A., France.
To mobilize a sum of Rs700mn through issue of 10,00,000 equity shares of Rs10/- each at a premium of Rs690/- per share on a preferential basis to M/s. Vicat S.A., France, its affiliates and subsidiaries. The scrip touched an intra-day high of Rs394 and a low of Rs375 and recordede volumes of over 1,00,000 shares on BSE.
Jain Irrigation ended 2% lower to close at Rs469. The company announced that it secured contract worth Rs227.7mn. The scrip touched an intra-day high of Rs480 and a low of Rs461 and recorded volumes of over 16,00,000 shares on BSE.
Corporate News
Suzlon Energy is partnering Bahrain-based PE firm Arcapita to bid for Chinese alternative energy Company, Honiton Energy Holdings estimated at US$400mn (ET)
GMR Group is likely to buy 50% stake in US-based power generation firm InterGen in a deal valued at US$1.2bn (ET)
GIC Special Investments to acquire 25.4% stake in S Kumars’ Reid & Taylor brand for Rs9bn (ET)
HDIL buys 51% stake in Broadcast Initiatives, a Sri Adhikari Bros Group controlled media firm for an undisclosed amount (ET)
Reliance Infra bags Rs120bn EPC order from R Power to develop Shashun UMPP (BS)
Tata Group has increased stake in its South African Telecom Venture Neotel by 30% to 56% (ET)
TCS has won a contract worth US$11.5mn from Uganda Revenue Authority (ET)
Information & Broadcasting Ministry has asked DoT to initiate action against Bharti Airtel for launching IPTV services without requisite approvals (ET)
Jindal Saw is planning to set up a ship building & repair hub in Gujarat with an investment of over US$2bn (ET)
RIL and Essar Oil have agreed to buy entire crude oil from Cairn India’s Rajasthan block and are negotiating prices (ET)
ADAG Group is set to launch 24-hour FM radio station in Singapore in collaboration with local station MediaCorp Radio (ET)
Tech Mahindra has bagged a US$7.6mn deal with telecom Fiji Ltd (BL)
RIL signs an agreement with UAE-based, Crescent Petroleum Company to jointly develop oil & gas projects in Middle East (DNA)
Jet Airways and Kingfisher Airlines are moving towards zero commission structure for travel agents (ET)
IndusInd Bank has raised Rs2.2bn from the overseas market through fresh issue of shares (ET)
Vicat buys 6.67% stake in Sagar Cements for Rs700mn at Rs700/share (BS)
ICICI Ventures may list US$1.5bn realty fund on the London Stock Exchange (BS)
Essar Shipping is planning to set up ports in Brazil, China and Vietnam (ET)
IndusInd Bank hikes PLR by 50bps (BS)
NIIT has signed an agreement with Infospectrum to market latter’s customizable Educational Resource Planning solutions in schools (BL)
Nilkamal to invest Rs1.5bn to develop retail stores in India (FE)
Essar Shipping arm lines up Rs100bn expansion plans for third party logistics (DNA)
Tata Chemical to spend Rs5bn to de-bottleneck and modernized its plant in current fiscal (DNA)
Economic News
RBI hikes repo rate by 50bps with immediate effect and raises CRR by 50bps in two stages (ET)
Exports grew by 2.9% in FY08 to US$155.4bn (ET)
Car makers to increase prices by Rs,6000-Rs30,000 across models (BS)
CBDT has raised Direct Tax collection target for FY09 to Rs3.95trn (BL)
Cement prices may to increase by Rs3-5 per bag from 1st July in Bombay (FE)
RBI pumps in Rs387bn through repo window (FE)
Planning Commission says 9% growth is possible
Tuesday, June 24, 2008
Will July Month See more Blood??? Subscribe to know
Use lower levels to add the large caps only even though the mid-cap and smaller stocks may have fallen more
SELL ONGC IN TRUCK LOADS N HOLD
Nifty at a support of 4212 and 4156 with resistance at 4325 and 4390 levels.
After a partial rebound from lower levels yesterday, we expect some bounce today. Barring European markets, which tumbled on bad set of economic data, most global markets ended flat to slightly negative. We see a cautious to perhaps a slightly higher opening in our market. Though a short-squeeze we predicted yesterday didn't fully materialise, the F&O segment did see some short covering. The Nifty June futures closed with a slight premium as against a discount of a few points. The open interest too declined substantially.
These factors point to short covering by the bears. More can be expected over the next couple days ahead of Thursday's settlement day. We will also have the outcome of the Fed meeting, where the US central bank is likely to keep rates steady while stressing on containing inflation.
On the political front, there hasn't been any significant new development, though some reports suggest that the UPA and Left may agree to some comprise formula to avoid early polls. A truce between the Congress and the red brigade could come as a welcome breather.
On the whole, the bulls may well have a good day in office after a four-day drubbing during which the Sensex has lost some 1,400 points. Much will hinge on global markets and F&O trends.
FIIs were net sellers of Rs6.66bn (provisional) in the cash segment on Monday while the local institutions poured in Rs917.5mn. In the F&O segment, foreign funds were net sellers of Rs1.66bn.
On Friday, FIIs were net sellers of Rs9.53bn in the cash segment. With this, they have pulled out almost $5.9bn from the Indian market this year.
Results Today: Amara Raja, Apollo Hospitals, Classic Diamond, Cyber Media, IndusInd Bank, Jet Airways, Patel Engineering, PSL, Ramsarup Industries, Sadbhav Engineering, Tata Chemicals and TV Today.
Shares of Rane Engine Valve Ltd. will get re-listed today.
Today's Pick -Tata Chemicals
We recommend a sell in a Tata Chemicals from a short-term perspective. It is evident from the charts that it was on a medium-term uptrend between March 2008 and May 2008 (from a low of Rs 255 to a high of Rs 440). However, the stock reversed direction and started experiencing selling pressure, after touching an all-time high of Rs 440. We notice a head and shoulders pattern (a top reversal pattern), spanning the last two months with neckline at Rs 333. On June 23, the stock breached this neckline and tumbled 6 per cent. The daily relative strength index has entered the bearish zone. The daily moving average convergence and divergence has entered the negative region too. We are bearish on the stock in the short-term. We expect the stock’s decline to prolong until it hits our price target of Rs 290 in the approaching trading sessions. Traders with short-term perspective can sell the stock while maintaining stop-loss at Rs 341
Corporate News
GMR will replace ONGC in Rs310bn Kakinada refinery and petrochemical project in Andhra Pradesh. (BS)
Tata Power plans to invest Rs250bn to boost its capacity by six-fold to 12,800mw by 2013. (BS)
GIC and Temasek may be allowed to pick up 10% stake each in ICICI Bank. (FE)
GAIL will issue one bonus share for every two equity shares held by its shareholders. (BS)
Wipro has raised Rs14bn through external borrowings. (BS)
Tech Mahindra has bagged a US$24mn engagement to assist Telecom New Zealand overhaul its retail business. (BL)
SBI is likely to raise its PLR and is awaiting fresh monetary action from the RBI to finalise the extent of increase. (BS)
Reliance Industries USA has acquired a polyester manufacturing facility in North Carolina for about US$12.2mn from Unifi Kinston and plans to invest US$215mn in that company. (ET)
Tata Motors has decided to absorb a significant portion of the cost increase of its Nano vendors. (ET)
Reliance Globalcom, the global arm of RCOM is entering into an alliance with a VOIP exchange in the US. (DNA)
M&M’s used-car business, First Choice is likely to sell 10% stake to Phi Advisors for ~Rs800mn. (ET)
Nalco will resume full production from June 25 after a strike cut the supply of coal to its Orissa power station. (BS)
Binani Cement has lined up capex plans of Rs16bn to take its global capacity to 13mmtpa by 2011-12. (BS)
Binani Cement is close to acquiring an African cement company for ~US$100mn. (ET)
Kingfisher Airlines and Deccan have slashed over 10% of their total daily flights. (BL)
Saint-Gobain Glass India plans to invest Rs10bn on a 0.3mn ton a year greenfield float glass making plant in Bhiwadi in Rajasthan. (BL)
ONGC Tripura Power Co, a unit of ONGC has awarded a Rs22.07bn order to a consortium of BHEL and GE for its 720 MW plant in Tripura. (ET)
Unichem has received a certification from the European Directorate for the Quality of Medicines and Healthcare for its active pharmaceutical ingredients plant in Roha, Maharashtra. (BL)
Unichem Laboratories has got approval from the US Food and Drug Administration for its formulations plant in the northern state of Uttar Pradesh. (ET)
JK Tyre has acquired 100% shares of Tornel, the Mexican Tyre company, along with its subsidiaries, for Rs2.7bn. (ET)
JK Tyre & Industries will raise prices of tyres by August. (ET)
Lupin has entered into a promotion agreement with Ascend Therapeutics Inc to promote its Suprax 400mg tablets in the US. (DNA)
The Parikhs, co-promoters of Zandu Pharmaceuticals have sent a letter to SEBI to thwart Emami Group’s attempt to take over the company. (ET)
Reliance Brands have entered into a 50:50 JV with Italy’s luxury sportswear brand Paul & Shark. (ET)
Alok Industries will invest Rs400mn in expanding its retail venture in FY09. (BL)
Religare Enterprises plans invest over Rs1bn for setting up 200 retail stores in the personal finance space under the Finmart brand over the next one year. (ET)
Pyramid Saimira Group, Chairman and MD P. S. Saminathan is considering an open offer to consolidate his stake in the company. (Mint)
Vodafone Essar has secured Rs70bn loan from lenders led by State Bank of India. (DNA)
SpiceJet plans to cut 20 flights from July 1. (BL)
Economic News
Around Rs80bn worth of real estate projects covering over 40mn square feet are facing delays. (BS)
DoT has asked TRAI to review termination charges. (BS)
Advance tax collection for the June 15 installment is expected to have gone up 30% on a yoy basis. (BL)
The June 30 bid submission date for the seventh round of NELP will not be deferred. (BL)
Indian corporate houses have raised a record more than Rs1trn by issuing corporate bonds during FY08. (Mint)
The DoT committee, formed to recommend ways to allocate and price 2G spectrum for mobile services, is likely to hold its first meeting in the first week of July. (ET)
The Competition Commission of India has asked SEBI to make compliance with competition law mandatory for listing on stock exchanges. (ET)
Government has held discussions with Nigeria to acquire more oil and gas fields. (FE)
RBI has decided that, for the limited purpose of valuation, all special securities issue by GoI, directly to the beneficiary entities, which do not carry SLR status may be valued at a spread of 25bps above the corresponding yield on GoI securities.
SELL ONGC IN TRUCK LOADS N HOLD
Nifty at a support of 4212 and 4156 with resistance at 4325 and 4390 levels.
After a partial rebound from lower levels yesterday, we expect some bounce today. Barring European markets, which tumbled on bad set of economic data, most global markets ended flat to slightly negative. We see a cautious to perhaps a slightly higher opening in our market. Though a short-squeeze we predicted yesterday didn't fully materialise, the F&O segment did see some short covering. The Nifty June futures closed with a slight premium as against a discount of a few points. The open interest too declined substantially.
These factors point to short covering by the bears. More can be expected over the next couple days ahead of Thursday's settlement day. We will also have the outcome of the Fed meeting, where the US central bank is likely to keep rates steady while stressing on containing inflation.
On the political front, there hasn't been any significant new development, though some reports suggest that the UPA and Left may agree to some comprise formula to avoid early polls. A truce between the Congress and the red brigade could come as a welcome breather.
On the whole, the bulls may well have a good day in office after a four-day drubbing during which the Sensex has lost some 1,400 points. Much will hinge on global markets and F&O trends.
FIIs were net sellers of Rs6.66bn (provisional) in the cash segment on Monday while the local institutions poured in Rs917.5mn. In the F&O segment, foreign funds were net sellers of Rs1.66bn.
On Friday, FIIs were net sellers of Rs9.53bn in the cash segment. With this, they have pulled out almost $5.9bn from the Indian market this year.
Results Today: Amara Raja, Apollo Hospitals, Classic Diamond, Cyber Media, IndusInd Bank, Jet Airways, Patel Engineering, PSL, Ramsarup Industries, Sadbhav Engineering, Tata Chemicals and TV Today.
Shares of Rane Engine Valve Ltd. will get re-listed today.
Today's Pick -Tata Chemicals
We recommend a sell in a Tata Chemicals from a short-term perspective. It is evident from the charts that it was on a medium-term uptrend between March 2008 and May 2008 (from a low of Rs 255 to a high of Rs 440). However, the stock reversed direction and started experiencing selling pressure, after touching an all-time high of Rs 440. We notice a head and shoulders pattern (a top reversal pattern), spanning the last two months with neckline at Rs 333. On June 23, the stock breached this neckline and tumbled 6 per cent. The daily relative strength index has entered the bearish zone. The daily moving average convergence and divergence has entered the negative region too. We are bearish on the stock in the short-term. We expect the stock’s decline to prolong until it hits our price target of Rs 290 in the approaching trading sessions. Traders with short-term perspective can sell the stock while maintaining stop-loss at Rs 341
Corporate News
GMR will replace ONGC in Rs310bn Kakinada refinery and petrochemical project in Andhra Pradesh. (BS)
Tata Power plans to invest Rs250bn to boost its capacity by six-fold to 12,800mw by 2013. (BS)
GIC and Temasek may be allowed to pick up 10% stake each in ICICI Bank. (FE)
GAIL will issue one bonus share for every two equity shares held by its shareholders. (BS)
Wipro has raised Rs14bn through external borrowings. (BS)
Tech Mahindra has bagged a US$24mn engagement to assist Telecom New Zealand overhaul its retail business. (BL)
SBI is likely to raise its PLR and is awaiting fresh monetary action from the RBI to finalise the extent of increase. (BS)
Reliance Industries USA has acquired a polyester manufacturing facility in North Carolina for about US$12.2mn from Unifi Kinston and plans to invest US$215mn in that company. (ET)
Tata Motors has decided to absorb a significant portion of the cost increase of its Nano vendors. (ET)
Reliance Globalcom, the global arm of RCOM is entering into an alliance with a VOIP exchange in the US. (DNA)
M&M’s used-car business, First Choice is likely to sell 10% stake to Phi Advisors for ~Rs800mn. (ET)
Nalco will resume full production from June 25 after a strike cut the supply of coal to its Orissa power station. (BS)
Binani Cement has lined up capex plans of Rs16bn to take its global capacity to 13mmtpa by 2011-12. (BS)
Binani Cement is close to acquiring an African cement company for ~US$100mn. (ET)
Kingfisher Airlines and Deccan have slashed over 10% of their total daily flights. (BL)
Saint-Gobain Glass India plans to invest Rs10bn on a 0.3mn ton a year greenfield float glass making plant in Bhiwadi in Rajasthan. (BL)
ONGC Tripura Power Co, a unit of ONGC has awarded a Rs22.07bn order to a consortium of BHEL and GE for its 720 MW plant in Tripura. (ET)
Unichem has received a certification from the European Directorate for the Quality of Medicines and Healthcare for its active pharmaceutical ingredients plant in Roha, Maharashtra. (BL)
Unichem Laboratories has got approval from the US Food and Drug Administration for its formulations plant in the northern state of Uttar Pradesh. (ET)
JK Tyre has acquired 100% shares of Tornel, the Mexican Tyre company, along with its subsidiaries, for Rs2.7bn. (ET)
JK Tyre & Industries will raise prices of tyres by August. (ET)
Lupin has entered into a promotion agreement with Ascend Therapeutics Inc to promote its Suprax 400mg tablets in the US. (DNA)
The Parikhs, co-promoters of Zandu Pharmaceuticals have sent a letter to SEBI to thwart Emami Group’s attempt to take over the company. (ET)
Reliance Brands have entered into a 50:50 JV with Italy’s luxury sportswear brand Paul & Shark. (ET)
Alok Industries will invest Rs400mn in expanding its retail venture in FY09. (BL)
Religare Enterprises plans invest over Rs1bn for setting up 200 retail stores in the personal finance space under the Finmart brand over the next one year. (ET)
Pyramid Saimira Group, Chairman and MD P. S. Saminathan is considering an open offer to consolidate his stake in the company. (Mint)
Vodafone Essar has secured Rs70bn loan from lenders led by State Bank of India. (DNA)
SpiceJet plans to cut 20 flights from July 1. (BL)
Economic News
Around Rs80bn worth of real estate projects covering over 40mn square feet are facing delays. (BS)
DoT has asked TRAI to review termination charges. (BS)
Advance tax collection for the June 15 installment is expected to have gone up 30% on a yoy basis. (BL)
The June 30 bid submission date for the seventh round of NELP will not be deferred. (BL)
Indian corporate houses have raised a record more than Rs1trn by issuing corporate bonds during FY08. (Mint)
The DoT committee, formed to recommend ways to allocate and price 2G spectrum for mobile services, is likely to hold its first meeting in the first week of July. (ET)
The Competition Commission of India has asked SEBI to make compliance with competition law mandatory for listing on stock exchanges. (ET)
Government has held discussions with Nigeria to acquire more oil and gas fields. (FE)
RBI has decided that, for the limited purpose of valuation, all special securities issue by GoI, directly to the beneficiary entities, which do not carry SLR status may be valued at a spread of 25bps above the corresponding yield on GoI securities.
Monday, June 23, 2008
Gap down for sure BUT Squeeze…handle with care!
Today, Nifty has support at 4,234 and resistance at 4,419 and BSE Sensex has support at 14,218 and resistance at 14,801
The outcome of this week's Federal Reserve meet and that of the UPA-Left panel on the nuke deal will have some bearing on the sentiment.
Today, we expect another gap-down opening. The current situation warrants extreme caution. Any advance (dare we say) is likely to be driven by short-covering as fresh buying is negligible. FIIs continue to be heavy sellers even as local funds are continuing their shopping spree. The market will remain under pressure unless crude oil (and local inflation) cools off sharply and FIIs turn net buyers.
The Indian Market is expected to have negative opening on the back of weak global cues as the US market closed in red and Asian markets are trading weak. On Friday, the Indian market closed with heavy losses pressurized by selling across the ground. It was a hard day for the domestic market as it hanged around extremely negative zone after positive start. It had shown negative attitude through out the trading session. Nuke Deal and inflation worries also caused distress for the market as political uncertainty occurred after CPM threatened the UPA to withdraw its support if government moves forward with the deal. Inflation figure released on Friday reached to 13 years high to 11.05% for the week ended 7 June 2008. From the sectoral front, metal and oil & gas stocks were most unfavorable as most of selling was seen in these baskets
Corporate News
Hindalco Industries plans 1:3 rights issue to raise Rs50bn.(TOI)
GMR group to buy stake in ONGC’s Rs310bn Kakinada refinery in Andhra Pradesh.(BS)
Taro Pharmaceuticals sues its proposed buyer Sun Pharmaceutical Industries for allegedly thwarting formers’ attempt to sell off its unit in Ireland.(BS)
L&T says its heavy engineering division crosses Rs10bn of order booking for hi-tech equipment & systems in two months of current quarter.(BL)
Essar Shipping Ports and Logistics to invest Rs 100bn for the development of shipping, ports and oil field services over the next three years.(BS)
DLF to get around 5,000 acres near greater Noida at less than market rate under the Taj Expressway Industrial Development Authority’s scheme.(ET)
Great Off-shore secures an order for its heavy lift vessel in a Mediterranean company for US$15mn per annum.(FE)
Ranbaxy to continue to pursue acquisitions despite the change in its ownership.(BL)
Glenmark has received an approval from USFDA for marketing and distribution of Trandolapril tablets.(TOI)
NTPC would add 3,000MW of power for commercial use in the current fiscal.(BL)
HDFC Bank raises its benchmark prime lending rate by 0.25% to 15.25%.(FE)
Petronet LNG considering taking participating interests in gas assets in Australia.(BL)
Reliance Industries USA to invest US$215mn and create 200 new jobs at a newly acquired polyester plant in the US.(FE)
A consortium of developers led by Maytas Infra starts work at the greenfield airport in Shimoga, Karnataka.(BL)
Jindal Steel & Power plans to invest Rs320bn in coal-to-liquid projects.(TOI)
MTNL floats a Rs2.5bn tender for building network based on Internet Protocol infrastructure.(ET)
Spencer’s Retail, part of the RPG group, plans to invest Rs25bn over the next two years to expand its retail network.(DNA)
HDFC AMC invests Rs2.4bn in Ansal Properties & Infrastructures’ Noida project.(BS)
Parsvnath Developers plans to open retail stores by end of this fiscal.(DNA)
Tata Steel and Essar Steel along with ArcelorMittal ruled out of the race to acquire a stake in Indonesia's state-owned Krakatau Steel.(ET)
Coal India and Tata Power to form a 40:60 JV to produce power from washery rejects.(BL)
Government approves mining plan for the coal block that Reliance Power plans to use for setting up 4,000MW UMPP at Sasan in Madhya Pradesh.(BS)
Royal Orchid Hotels to develop six new hotels with an investment of Rs5.2bn.(DNA)
Indo Asian Fusegear shelves its plan to buy a majority stake in a European firm.(ET)
SAIL keen on reviving a long pending proposal to fund Rs1.7bn project for redevelopment of Bharat Coking Coal operated Moonidih mine in Jharkhand.(BL)
Punjab National Bank to raise deposit rates by 50bps.(TOI)
Three UK based companies show interest in picking up a controlling stake in GHCL.(BL)
US based Holiday Group to enter into infrastructure, housing and hospitality sectors in Kerala with an investment of Rs10n.(ET)
SVP Group has signed a deal with Bharti Retail to lease out 32,000sq ft of space in Ghaziabad.(ET)
S Kumars subsidiary Reid and Taylor may sell stake to a European fund for Rs150 per share.(ET)
Amtek Transportation Division, part of Amtek Auto, enters into a JV with American Railcar Industries to foray into railcars.(ET)
Economic News
Leading Indian carriers say more air fare increases are possible.(BS)
Finance Ministry says it expects RBI to take monetary measures to help check inflation.(FE)
3G spectrum is not available in certain circles for allocation to CDMA players, according to an internal TRAI study.(BS)
TRAI to submit its recommendations on internet telephony in two months.(ET)
Coal ministry gives its approval for setting up a regulatory body for coal.(DNA)
Provident Fund trustees to press for increasing the interest rate on PF to at least 12%.(ET)
CMIE forecasts 5.5% inflation for FY09.(FE)
As per SEBI, currency futures may start by end of August 2008.(ET)
India exports to the European Union may face higher barriers, if the latter goes ahead with a proposal to place carbon tax on goods imported from advanced developing countries.
The outcome of this week's Federal Reserve meet and that of the UPA-Left panel on the nuke deal will have some bearing on the sentiment.
Today, we expect another gap-down opening. The current situation warrants extreme caution. Any advance (dare we say) is likely to be driven by short-covering as fresh buying is negligible. FIIs continue to be heavy sellers even as local funds are continuing their shopping spree. The market will remain under pressure unless crude oil (and local inflation) cools off sharply and FIIs turn net buyers.
The Indian Market is expected to have negative opening on the back of weak global cues as the US market closed in red and Asian markets are trading weak. On Friday, the Indian market closed with heavy losses pressurized by selling across the ground. It was a hard day for the domestic market as it hanged around extremely negative zone after positive start. It had shown negative attitude through out the trading session. Nuke Deal and inflation worries also caused distress for the market as political uncertainty occurred after CPM threatened the UPA to withdraw its support if government moves forward with the deal. Inflation figure released on Friday reached to 13 years high to 11.05% for the week ended 7 June 2008. From the sectoral front, metal and oil & gas stocks were most unfavorable as most of selling was seen in these baskets
Corporate News
Hindalco Industries plans 1:3 rights issue to raise Rs50bn.(TOI)
GMR group to buy stake in ONGC’s Rs310bn Kakinada refinery in Andhra Pradesh.(BS)
Taro Pharmaceuticals sues its proposed buyer Sun Pharmaceutical Industries for allegedly thwarting formers’ attempt to sell off its unit in Ireland.(BS)
L&T says its heavy engineering division crosses Rs10bn of order booking for hi-tech equipment & systems in two months of current quarter.(BL)
Essar Shipping Ports and Logistics to invest Rs 100bn for the development of shipping, ports and oil field services over the next three years.(BS)
DLF to get around 5,000 acres near greater Noida at less than market rate under the Taj Expressway Industrial Development Authority’s scheme.(ET)
Great Off-shore secures an order for its heavy lift vessel in a Mediterranean company for US$15mn per annum.(FE)
Ranbaxy to continue to pursue acquisitions despite the change in its ownership.(BL)
Glenmark has received an approval from USFDA for marketing and distribution of Trandolapril tablets.(TOI)
NTPC would add 3,000MW of power for commercial use in the current fiscal.(BL)
HDFC Bank raises its benchmark prime lending rate by 0.25% to 15.25%.(FE)
Petronet LNG considering taking participating interests in gas assets in Australia.(BL)
Reliance Industries USA to invest US$215mn and create 200 new jobs at a newly acquired polyester plant in the US.(FE)
A consortium of developers led by Maytas Infra starts work at the greenfield airport in Shimoga, Karnataka.(BL)
Jindal Steel & Power plans to invest Rs320bn in coal-to-liquid projects.(TOI)
MTNL floats a Rs2.5bn tender for building network based on Internet Protocol infrastructure.(ET)
Spencer’s Retail, part of the RPG group, plans to invest Rs25bn over the next two years to expand its retail network.(DNA)
HDFC AMC invests Rs2.4bn in Ansal Properties & Infrastructures’ Noida project.(BS)
Parsvnath Developers plans to open retail stores by end of this fiscal.(DNA)
Tata Steel and Essar Steel along with ArcelorMittal ruled out of the race to acquire a stake in Indonesia's state-owned Krakatau Steel.(ET)
Coal India and Tata Power to form a 40:60 JV to produce power from washery rejects.(BL)
Government approves mining plan for the coal block that Reliance Power plans to use for setting up 4,000MW UMPP at Sasan in Madhya Pradesh.(BS)
Royal Orchid Hotels to develop six new hotels with an investment of Rs5.2bn.(DNA)
Indo Asian Fusegear shelves its plan to buy a majority stake in a European firm.(ET)
SAIL keen on reviving a long pending proposal to fund Rs1.7bn project for redevelopment of Bharat Coking Coal operated Moonidih mine in Jharkhand.(BL)
Punjab National Bank to raise deposit rates by 50bps.(TOI)
Three UK based companies show interest in picking up a controlling stake in GHCL.(BL)
US based Holiday Group to enter into infrastructure, housing and hospitality sectors in Kerala with an investment of Rs10n.(ET)
SVP Group has signed a deal with Bharti Retail to lease out 32,000sq ft of space in Ghaziabad.(ET)
S Kumars subsidiary Reid and Taylor may sell stake to a European fund for Rs150 per share.(ET)
Amtek Transportation Division, part of Amtek Auto, enters into a JV with American Railcar Industries to foray into railcars.(ET)
Economic News
Leading Indian carriers say more air fare increases are possible.(BS)
Finance Ministry says it expects RBI to take monetary measures to help check inflation.(FE)
3G spectrum is not available in certain circles for allocation to CDMA players, according to an internal TRAI study.(BS)
TRAI to submit its recommendations on internet telephony in two months.(ET)
Coal ministry gives its approval for setting up a regulatory body for coal.(DNA)
Provident Fund trustees to press for increasing the interest rate on PF to at least 12%.(ET)
CMIE forecasts 5.5% inflation for FY09.(FE)
As per SEBI, currency futures may start by end of August 2008.(ET)
India exports to the European Union may face higher barriers, if the latter goes ahead with a proposal to place carbon tax on goods imported from advanced developing countries.
Friday, June 20, 2008
Inflation to fuel proceedings
We might see a bounce in Realty and banking sector today,
A dark horse in this scenario might be Aviation,
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A dark horse in this scenario might be Aviation,
To know more visit
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Thursday, June 19, 2008
BUY RANBAXY IN TRAIN LOADS AND TIMELY BOOK PROFIT
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We expect the market to open on a weak note and the trend may not change for most part of the day, unless there is some fresh short covering. The market will have to keep one eye on New Delhi and the other eye on global markets. Quite a strain for the eyes and the market!
FIIs were net sellers of Rs4.35bn (provisional) in the cash segment on Wednesday while the local institutions poured in Rs1.94bn. In the F&O segment, foreign funds were net sellers of Rs1.93bn.
The institutions remain sluggish to buy at lower levels and that more or less explains the continued tension on the bourses. After a two-day rally (any small gain is a rally these days), the key indices gave up some of the gains. Renewed weakness in global markets and fresh tension between the Government and the Left parties over the Indo-US nuclear deal played spoilsport. The sudden rise in political temperature in New Delhi could do some more harm today amid worries over the fate of the Congress-led UPA regime. Given the uncertain political environment, the bulls may like to tread cautiously. Also, global markets fell sharply overnight while Asian markets too are in the red this morning. Crude oil continues to be highly volatile, keeping global markets on the edge.
Today's Pick - Bank of Baroda
Picks - SUJANA TOWER,GSS AMERICA, BURNPUR CEM
We recommend a sell on Bank of Baroda from a short-term perspective. From the charts of Bank of Baroda, we note that the stock has been on an intermediate-term downtrend, since its January 2008 high of Rs 501, forming lower peaks and lower troughs.
However, after touching 2008 low of Rs 211 on June 9, the stock witnessed a corrective up-move.
This up-move of the stock did not sustain, as the stock encountered twin resistances (a key resistance level and down trendline) at about Rs 260.
On June 18, the stock declined and formed a dark cloud candlestick pattern that indicates bearishness. The weekly momentum indicator is featuring in the bearish zone and the daily momentum indicator is likely to re-enter this zone.
With the intermediate-term down trendline still intact, we are bearish on the stock in the short-term. We expect the stock to decline until it hits our price target of Rs 218 in the upcoming trading sessions. Traders with short-term perspective can sell the stock, while maintaining stop-loss at Rs 258.
Shares of Niraj Cement Structurals Ltd. will get listed today.
Results Today: EIH Associates, Future Capital, JHS Svendgaard, Kirloskar Ferrous, Ratnamani Metals, Simplex Realty and Uniflex Cable
Corporate News
Ranbaxy settles worldwide patent litigations with Pfizer over Lipitor. Under the agreement, Ranbaxy will be allowed to sell generic versions of the drug in the US from November 30, 2011. (BL)
ONGC, IOC and Gail have expressed interest in buying ADB's stake in Petronet LNG. (ET)
RCom may initiate criminal proceedings against RIL officials involved in the signing of January 12, 2006 agreement. (BL)
The MSRDC may ask Mukesh Ambani-controlled SeaKing Infrastructure Ltd (SKIL)-led consortium to bring down the concession period for the Rs60bn, 22-km sea link between Sewari and Nava Sheva. (BS)
MTNL has received the international long distance license from DoT. (ET)
Zee Entertainment may list its two divisions Zee Motion Pictures and Zee Limelight on the London Stock Exchange’s AIM. (FE)
Tata Steel and Essar Steel are vying for a majority stake in the proposed joint venture of Indonesia's PT Krakatau Steel to build a 2.5mtpa plant. (BS)
The Government may infuse more capital into Central Bank of India on improved performance. (FE)
RIL has denied it has signed formal gas sale contracts with prospective customers in defiance of a Bombay High Court order. (ET)
M&M plans to roll out "Mahindra" tractors from the Punjab Tractors unit in Mohali. (BS)
The NCD-cum-convertible warrants offer of Indian Hotels faced lukewarm response, forcing the promoters to pick up the unsubscribed portion of just over 80% for about Rs4.8bn. (ET)
Reliance Big Entertainment is in talks with PEs for selling a 10% stake for a valuation of US$5bn. (ET)
Andhra Bank to raise US$300mn foreign currency loan in 2008-09. (BL)
The Leela Palaces, Hotels and Resorts signs a sales and marketing agreement with US-based Preferred Hotel Group. (ET)
MindTree to invest US$45mn in its new software development centre at Mahindra World City SEZ in Maraimalai Nagar. (BL)
Union Bank of India to raise US$2bn through medium term debt from international market for its overseas expansion. (ET)
With the Karnataka High Court approving the Kingfisher Airlines – Deccan Aviation merger, Kingfisher Airlines’ plans to fly overseas soon. (BL)
Moschip Semiconductor has acquired US-based Indigita, the audio and video division of Intellasys. (BL)
Sintex Industries has acquired Digvijay Communications and Networks in the form of a slump sale. (BL)
Citrix to invest US$200mn in its second R&D facility in Bangalore over the next five years. (ET)
Sujana Towers has acquired of 51% stake in an African telecom infrastructure company, Telesuprecon. (BL)
Exide Industries acquires 51% in Bangalore-based lead smelter Leadage Alloys India Ltd. (BL)
Shyam Group and Spanco have sign an agreement with Punj Lloyd to acquire its Internet services company Spectranet. (BL)
Economic News
Infrastructure sector growth dips to 3.6% in April compared to the same month last year. (BL)
Aided by higher TDS collections, the Centre’s net direct tax collections recorded a 71.3% increase during the first two months of the current fiscal to Rs228.4bn against Rs133.4bn in the same period last year. (BL)
India to receive an estimated loan amount of US$9.2bn from the Asian Development Bank between 2008 and 2010 for various development projects. (FE)
The Government to allow only Gujarat companies to export cement. (ET)
The RBI has made it mandatory for RRBs to report all suspicious transactions above Rs1mn to the directorate of financial intelligence as part of exercise to strengthen the anti-money laundering drive. (ET)
The Government reduced prices of complex fertilizers by up to Rs2,296 per ton.
We expect the market to open on a weak note and the trend may not change for most part of the day, unless there is some fresh short covering. The market will have to keep one eye on New Delhi and the other eye on global markets. Quite a strain for the eyes and the market!
FIIs were net sellers of Rs4.35bn (provisional) in the cash segment on Wednesday while the local institutions poured in Rs1.94bn. In the F&O segment, foreign funds were net sellers of Rs1.93bn.
The institutions remain sluggish to buy at lower levels and that more or less explains the continued tension on the bourses. After a two-day rally (any small gain is a rally these days), the key indices gave up some of the gains. Renewed weakness in global markets and fresh tension between the Government and the Left parties over the Indo-US nuclear deal played spoilsport. The sudden rise in political temperature in New Delhi could do some more harm today amid worries over the fate of the Congress-led UPA regime. Given the uncertain political environment, the bulls may like to tread cautiously. Also, global markets fell sharply overnight while Asian markets too are in the red this morning. Crude oil continues to be highly volatile, keeping global markets on the edge.
Today's Pick - Bank of Baroda
Picks - SUJANA TOWER,GSS AMERICA, BURNPUR CEM
We recommend a sell on Bank of Baroda from a short-term perspective. From the charts of Bank of Baroda, we note that the stock has been on an intermediate-term downtrend, since its January 2008 high of Rs 501, forming lower peaks and lower troughs.
However, after touching 2008 low of Rs 211 on June 9, the stock witnessed a corrective up-move.
This up-move of the stock did not sustain, as the stock encountered twin resistances (a key resistance level and down trendline) at about Rs 260.
On June 18, the stock declined and formed a dark cloud candlestick pattern that indicates bearishness. The weekly momentum indicator is featuring in the bearish zone and the daily momentum indicator is likely to re-enter this zone.
With the intermediate-term down trendline still intact, we are bearish on the stock in the short-term. We expect the stock to decline until it hits our price target of Rs 218 in the upcoming trading sessions. Traders with short-term perspective can sell the stock, while maintaining stop-loss at Rs 258.
Shares of Niraj Cement Structurals Ltd. will get listed today.
Results Today: EIH Associates, Future Capital, JHS Svendgaard, Kirloskar Ferrous, Ratnamani Metals, Simplex Realty and Uniflex Cable
Corporate News
Ranbaxy settles worldwide patent litigations with Pfizer over Lipitor. Under the agreement, Ranbaxy will be allowed to sell generic versions of the drug in the US from November 30, 2011. (BL)
ONGC, IOC and Gail have expressed interest in buying ADB's stake in Petronet LNG. (ET)
RCom may initiate criminal proceedings against RIL officials involved in the signing of January 12, 2006 agreement. (BL)
The MSRDC may ask Mukesh Ambani-controlled SeaKing Infrastructure Ltd (SKIL)-led consortium to bring down the concession period for the Rs60bn, 22-km sea link between Sewari and Nava Sheva. (BS)
MTNL has received the international long distance license from DoT. (ET)
Zee Entertainment may list its two divisions Zee Motion Pictures and Zee Limelight on the London Stock Exchange’s AIM. (FE)
Tata Steel and Essar Steel are vying for a majority stake in the proposed joint venture of Indonesia's PT Krakatau Steel to build a 2.5mtpa plant. (BS)
The Government may infuse more capital into Central Bank of India on improved performance. (FE)
RIL has denied it has signed formal gas sale contracts with prospective customers in defiance of a Bombay High Court order. (ET)
M&M plans to roll out "Mahindra" tractors from the Punjab Tractors unit in Mohali. (BS)
The NCD-cum-convertible warrants offer of Indian Hotels faced lukewarm response, forcing the promoters to pick up the unsubscribed portion of just over 80% for about Rs4.8bn. (ET)
Reliance Big Entertainment is in talks with PEs for selling a 10% stake for a valuation of US$5bn. (ET)
Andhra Bank to raise US$300mn foreign currency loan in 2008-09. (BL)
The Leela Palaces, Hotels and Resorts signs a sales and marketing agreement with US-based Preferred Hotel Group. (ET)
MindTree to invest US$45mn in its new software development centre at Mahindra World City SEZ in Maraimalai Nagar. (BL)
Union Bank of India to raise US$2bn through medium term debt from international market for its overseas expansion. (ET)
With the Karnataka High Court approving the Kingfisher Airlines – Deccan Aviation merger, Kingfisher Airlines’ plans to fly overseas soon. (BL)
Moschip Semiconductor has acquired US-based Indigita, the audio and video division of Intellasys. (BL)
Sintex Industries has acquired Digvijay Communications and Networks in the form of a slump sale. (BL)
Citrix to invest US$200mn in its second R&D facility in Bangalore over the next five years. (ET)
Sujana Towers has acquired of 51% stake in an African telecom infrastructure company, Telesuprecon. (BL)
Exide Industries acquires 51% in Bangalore-based lead smelter Leadage Alloys India Ltd. (BL)
Shyam Group and Spanco have sign an agreement with Punj Lloyd to acquire its Internet services company Spectranet. (BL)
Economic News
Infrastructure sector growth dips to 3.6% in April compared to the same month last year. (BL)
Aided by higher TDS collections, the Centre’s net direct tax collections recorded a 71.3% increase during the first two months of the current fiscal to Rs228.4bn against Rs133.4bn in the same period last year. (BL)
India to receive an estimated loan amount of US$9.2bn from the Asian Development Bank between 2008 and 2010 for various development projects. (FE)
The Government to allow only Gujarat companies to export cement. (ET)
The RBI has made it mandatory for RRBs to report all suspicious transactions above Rs1mn to the directorate of financial intelligence as part of exercise to strengthen the anti-money laundering drive. (ET)
The Government reduced prices of complex fertilizers by up to Rs2,296 per ton.
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