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Wednesday, July 29, 2009
Tech exports seen rising 4-7 pct in FY10
India's software and services exports are seen rising 4 to 7 percent in the year to March 2010, sharply slowing from past years' robust growth on sluggish demand for outsourcing services, an industry body said on Wednesday.
Export of software and back-office outsourcing services will rise to $48 billion to $50 billion in this fiscal year, up from $46.3 billion last year, the National Association of Software and Service Companies (Nasscom) said.
A Nasscom spokeswoman said the growth in percent terms was calculated before rounding off the target of $48-$50 billion.
The sector's export earnings grew 16 percent in the fiscal year ending March 2009, having grown by more than 20 percent in previous years.
Nasscom said in a statement the demand environment remained weak and global information technology spending was expected to fall further this year and next, with Indian companies facing pricing pressure.
India's export-driven outsourcing companies have thrived for years by winning contracts from overseas clients, helped by a large pool of English-speaking engineering workforce and cheaper wages.
But a downturn in the United States, which accounts for more than half of the sector's export revenue, and turmoil in the global financial sector have halted the scorching pace of growth.
Infosys Technologies, India's No. 2 software services exporter, has forecast its first annual revenue fall for the year to March 2010 as some of its overseas clients cutback on outsourcing and demand fee cuts in a tough business environment.
Sector leader Tata Consultancy Services, Infosys and third-ranked Wipro offer services such as system integration, application development, supply chain design and back-office services.
The firms face stiff competition from bigger global rivals such as IBM and Accenture in winning large outsourcing deals.
Nasscom said total revenue of the export-driven sector, which employs more than 2 million people, grew by 13 percent to $58.8 billion in the year to March 2009.
Export of software and back-office outsourcing services will rise to $48 billion to $50 billion in this fiscal year, up from $46.3 billion last year, the National Association of Software and Service Companies (Nasscom) said.
A Nasscom spokeswoman said the growth in percent terms was calculated before rounding off the target of $48-$50 billion.
The sector's export earnings grew 16 percent in the fiscal year ending March 2009, having grown by more than 20 percent in previous years.
Nasscom said in a statement the demand environment remained weak and global information technology spending was expected to fall further this year and next, with Indian companies facing pricing pressure.
India's export-driven outsourcing companies have thrived for years by winning contracts from overseas clients, helped by a large pool of English-speaking engineering workforce and cheaper wages.
But a downturn in the United States, which accounts for more than half of the sector's export revenue, and turmoil in the global financial sector have halted the scorching pace of growth.
Infosys Technologies, India's No. 2 software services exporter, has forecast its first annual revenue fall for the year to March 2010 as some of its overseas clients cutback on outsourcing and demand fee cuts in a tough business environment.
Sector leader Tata Consultancy Services, Infosys and third-ranked Wipro offer services such as system integration, application development, supply chain design and back-office services.
The firms face stiff competition from bigger global rivals such as IBM and Accenture in winning large outsourcing deals.
Nasscom said total revenue of the export-driven sector, which employs more than 2 million people, grew by 13 percent to $58.8 billion in the year to March 2009.
Tirupati to get Rs 2,223-cr facelift
The temple-town Tirupati will get a facelift with the Centre including it in the Jawaharlal Nehru National Urban Renewal Mission scheme.
The State-level Monitoring Committee of JNNURM today approved Rs 2,223-crore comprehensive City Development Plan for Tirupati, Urban Development Minister Aanam Ramanarayana Reddy said. Under the project, Tirupati would get underground drainage system, n ew parks and enhanced drinking water supply. The town will also get 50 modern buses to cater to the needs of pilgrims, the minister said.
The State-level Monitoring Committee of JNNURM today approved Rs 2,223-crore comprehensive City Development Plan for Tirupati, Urban Development Minister Aanam Ramanarayana Reddy said. Under the project, Tirupati would get underground drainage system, n ew parks and enhanced drinking water supply. The town will also get 50 modern buses to cater to the needs of pilgrims, the minister said.
India May ‘Reverse’ Rate Cuts as Food, Energy Stoke Inflation
India’s central bank may start reversing its interest-rate cuts in early 2010 as food and energy prices fan inflation, after it kept borrowing costs unchanged yesterday to bolster economic growth.
“On the way forward, the Reserve Bank will have to reverse the expansionary measures to subdue inflationary pressures while preserving the growth momentum,” Governor Duvvuri Subbarao said. Inflation may “creep up” to about 5 percent by March next year compared with an April estimate of 4 percent, he said.
India is vulnerable to inflation as it relies on imported oil and demand for food from its 1.2 billion people exceeds supply. The People’s Bank of China said yesterday that inflation may rebound in the second half, while Australia’s central bank said its economy may recover faster than anticipated from the worst global recession since the Great Depression.
“India may be the first one to raise rates,” said Chetan Ahya, a regional economist at Morgan Stanley in Singapore. “The wholesale price inflation that India looks at will be closer to 6 percent by March 2010.”
HSBC Group Plc economist Robert Prior-Wandesforde and Macquarie Group Ltd. economist Rajeev Malik expect interest rates in India to be raised from about April. Nomura Securities Co. economist Sonal Varma brought forward her forecast of a rate increase to January from April.
Besides being buffeted by higher global commodity costs, inflation in India is also fueled by congested roads and ports and power shortages that add to the cost of doing business.
Power Shortages
Almost every manufacturer in India including carmaker Honda Motor Co. has invested in power back-ups because of frequent outages. Peak power shortage for the year ending March 31 will widen to 12.6 percent from 11.9 percent a year earlier, according to the nation’s electricity regulator.
India’s key wholesale price inflation index, announced weekly, has been negative for the six weeks to July 11. The central bank said this was a “statistical effect” as prices included in the gauge rose faster in the same period last year.
Consumer-price inflation is running at between 7 percent and 10 percent, driven by high food costs, according to indexes that measure the cost of living for industrial and farm workers.
Goldman Sachs Group Plc and HSBC say the central bank’s 5 percent inflation forecast is conservative and was likely to be exceeded due to higher costs of oil, food and other commodities.
“We suspect inflation will rise faster, reaching 6 percent to 7 percent by March next year, and that this will prompt a relatively aggressive tightening of interest rates through 2010,” said Mark Williams, international economist at Capital Economics Ltd. in London.
Oil, Sugar
Crude oil, which India imports to meet three-quarters of its needs, has gained 53 percent this year.
India, the world’s biggest consumer of sugar, may need to import at least 4 million metric tons in the year starting Oct. 1 to meet a supply shortfall, said Bajaj Hindusthan Ltd., the nation’s biggest producer by capacity. India is importing the sweetener for the first time in three years and sugar prices are at a three-year high.
Palm oil, of which India is the biggest importer in the world after China, has gained 26 percent this year.
Indian policy makers are not alone in grappling with the prospect of accelerating inflation.
The Chinese central bank said yesterday that inflation may rebound this year, with the consumer-price index bottoming in the third quarter.
Asset Bubbles
China needs to end an excessively loose monetary policy that threatens asset bubbles, overcapacity, bad loans and resurgent inflation, He Fan, a senior researcher at the Chinese Academy for Social Sciences said in Beijing yesterday.
He cautioned that pumping up economic growth in the short term could lead to the nation’s recovery being followed by a second slump. CASS is a government-backed think tank.
China’s consumer prices fell 1.7 percent in June, the fifth straight decline and the biggest drop since 1999.
India’s Subbarao, while flagging inflation concerns, also raised the central bank’s growth forecast to 6 percent “with an upward bias.” That prompted economists to interpret the policy as switching its focus from growth to inflation.
“The RBI is becoming cautiously optimistic on the growth outlook and more concerned about higher inflation,” Varma from Nomura said.
For now, Subbarao said the central bank will continue to provide an “accomodative” policy because growth, constrained by weak global demand for exports and poor farm production on account of scanty rains, may start to revive only after October.
“The RBI statement gives more support to our view that the central bank will start hiking interest rates in early 2010, due to latent inflationary pressures and strengthening aggregate demand,” said Tushar Poddar, an economist at Goldman Sachs in Mumbai.
“On the way forward, the Reserve Bank will have to reverse the expansionary measures to subdue inflationary pressures while preserving the growth momentum,” Governor Duvvuri Subbarao said. Inflation may “creep up” to about 5 percent by March next year compared with an April estimate of 4 percent, he said.
India is vulnerable to inflation as it relies on imported oil and demand for food from its 1.2 billion people exceeds supply. The People’s Bank of China said yesterday that inflation may rebound in the second half, while Australia’s central bank said its economy may recover faster than anticipated from the worst global recession since the Great Depression.
“India may be the first one to raise rates,” said Chetan Ahya, a regional economist at Morgan Stanley in Singapore. “The wholesale price inflation that India looks at will be closer to 6 percent by March 2010.”
HSBC Group Plc economist Robert Prior-Wandesforde and Macquarie Group Ltd. economist Rajeev Malik expect interest rates in India to be raised from about April. Nomura Securities Co. economist Sonal Varma brought forward her forecast of a rate increase to January from April.
Besides being buffeted by higher global commodity costs, inflation in India is also fueled by congested roads and ports and power shortages that add to the cost of doing business.
Power Shortages
Almost every manufacturer in India including carmaker Honda Motor Co. has invested in power back-ups because of frequent outages. Peak power shortage for the year ending March 31 will widen to 12.6 percent from 11.9 percent a year earlier, according to the nation’s electricity regulator.
India’s key wholesale price inflation index, announced weekly, has been negative for the six weeks to July 11. The central bank said this was a “statistical effect” as prices included in the gauge rose faster in the same period last year.
Consumer-price inflation is running at between 7 percent and 10 percent, driven by high food costs, according to indexes that measure the cost of living for industrial and farm workers.
Goldman Sachs Group Plc and HSBC say the central bank’s 5 percent inflation forecast is conservative and was likely to be exceeded due to higher costs of oil, food and other commodities.
“We suspect inflation will rise faster, reaching 6 percent to 7 percent by March next year, and that this will prompt a relatively aggressive tightening of interest rates through 2010,” said Mark Williams, international economist at Capital Economics Ltd. in London.
Oil, Sugar
Crude oil, which India imports to meet three-quarters of its needs, has gained 53 percent this year.
India, the world’s biggest consumer of sugar, may need to import at least 4 million metric tons in the year starting Oct. 1 to meet a supply shortfall, said Bajaj Hindusthan Ltd., the nation’s biggest producer by capacity. India is importing the sweetener for the first time in three years and sugar prices are at a three-year high.
Palm oil, of which India is the biggest importer in the world after China, has gained 26 percent this year.
Indian policy makers are not alone in grappling with the prospect of accelerating inflation.
The Chinese central bank said yesterday that inflation may rebound this year, with the consumer-price index bottoming in the third quarter.
Asset Bubbles
China needs to end an excessively loose monetary policy that threatens asset bubbles, overcapacity, bad loans and resurgent inflation, He Fan, a senior researcher at the Chinese Academy for Social Sciences said in Beijing yesterday.
He cautioned that pumping up economic growth in the short term could lead to the nation’s recovery being followed by a second slump. CASS is a government-backed think tank.
China’s consumer prices fell 1.7 percent in June, the fifth straight decline and the biggest drop since 1999.
India’s Subbarao, while flagging inflation concerns, also raised the central bank’s growth forecast to 6 percent “with an upward bias.” That prompted economists to interpret the policy as switching its focus from growth to inflation.
“The RBI is becoming cautiously optimistic on the growth outlook and more concerned about higher inflation,” Varma from Nomura said.
For now, Subbarao said the central bank will continue to provide an “accomodative” policy because growth, constrained by weak global demand for exports and poor farm production on account of scanty rains, may start to revive only after October.
“The RBI statement gives more support to our view that the central bank will start hiking interest rates in early 2010, due to latent inflationary pressures and strengthening aggregate demand,” said Tushar Poddar, an economist at Goldman Sachs in Mumbai.
FDI slips by over 43% to around $2.2 billion in May
India's foreign direct investment(FDI) declined by over 43 per cent to around USD 2.2 billion in May, 2009, compared to USD 3.9 billion in the same period last year on account of global recession.
"FDI was around USD 2.2 billion in May," Department of
Industrial Policy and Promotion Secretary Ajay Shankar told
reporters on the sidelines of a seminar organised by
CII-Institute of Logistics. And "we think that liquidity is improving and confidence in the economy is rising. These numbers (FDI) should pick up," Shankar said.
The government had scaled down the FDI target by USD 5
billion from USD 35 billion last fiscal. Cumulative FDI from
April 2000 to March 2009 stands close to about USD 90 billion.
Thanks to robust trends in the first six months of the
last fiscal, FDI in 2008-09 was USD 27.3 billion against USD
24.5 billion in 2007-08
"FDI was around USD 2.2 billion in May," Department of
Industrial Policy and Promotion Secretary Ajay Shankar told
reporters on the sidelines of a seminar organised by
CII-Institute of Logistics. And "we think that liquidity is improving and confidence in the economy is rising. These numbers (FDI) should pick up," Shankar said.
The government had scaled down the FDI target by USD 5
billion from USD 35 billion last fiscal. Cumulative FDI from
April 2000 to March 2009 stands close to about USD 90 billion.
Thanks to robust trends in the first six months of the
last fiscal, FDI in 2008-09 was USD 27.3 billion against USD
24.5 billion in 2007-08
Sun Pharma Q1 cons net profit down Rs 163.8cr
Sun Pharmaceutical Industries has announced its first quarter results. Its consolidated net sales were at Rs 787.6 crore versus Rs 1,041.8 crore. Its consolidated net profit was at Rs 163.8 crore versus Rs 501.4 crore.
ArcelorMittal Posts $792 Million Loss, Raises Output (Update3)
ArcelorMittal, the world’s biggest steelmaker, posted a third consecutive quarterly loss and said it plans to restart some shuttered output as demand recovers.
The second-quarter net loss was $792 million, or 57 cents a share, compared with net income of $5.84 billion, or $4.19, a year earlier, Luxembourg-based ArcelorMittal said today in a statement. The loss, which included $1.2 billion of inventory writedowns and provisions for job cuts, missed the $336 million median of eight analyst estimates compiled by Bloomberg. The shares slid as much as 7.9 percent, the most in two months.
“The second quarter was another challenging period,” Chief Executive Officer Lakshmi Mittal said in a conference call. “We are beginning to see more positive signals.”
ArcelorMittal, whose share price advanced 47 percent in the quarter, said this month it was restarting blast furnaces in Ghent in Belgium, Florange in France, and Gijon in Spain as customers buy steel to replace depleted inventories. The company shipped 17 million metric tons of steel in the second quarter, 43 percent less than a year earlier.
The shares were 1.025 euros lower at 24.30 euros as of 12:25 p.m. in Amsterdam trading. Earlier, they had their biggest intraday drop since May 21.
Higher Shipments
ArcelorMittal said today the first half will be “the bottom of the cycle.” The demand outlook is still “uncertain,” U.S. Steel Corp., the largest U.S. producer, said yesterday. Sweden’s SSAB Svenskt Staal AB posted its first loss in eight years on July 27 and said third-quarter earnings will be weaker. European demand is unlikely to recover until “well into 2010,” Moody’s Investors Service said last week.
ArcelorMittal forecast earnings before interest, tax, depreciation and amortization of $1.4 billion to $1.8 billion in the third quarter. Average steel selling prices will be stable or slightly lower, it said. Shipments will be least 1 million tons higher than in the second quarter, Chief Financial Officer Aditya Mittal said.
“If all the steelmakers increase production we’ll be back where we started,” Charlie Dove-Edwin, an analyst at MF Global UK Ltd. in London who has a “sell” recommendation on the stock, said by phone today. “There’s not enough real demand out here and making more steel will just send the price down.”
Return to Profit
Analysts predict a return to profit in the quarter as demand recovers and prices increase. The cost of hot-rolled coil, a benchmark steel product used in cars and construction, gained 4.2 percent in the second quarter, the first such increase in a year, according to data compiled by Metal Bulletin.
ArcelorMittal said it achieved annualized fixed-cost cuts of $8.4 billion at the end of the second quarter. Sales declined 60 percent to $15.2 billion.
The steelmaker said July 17 there was a “positive outcome” to its request to lenders to amend terms on $31 billion of loan facilities. The ratio of debt to Ebitda on the company’s principal facilities will rise to 4.5 in December and will fall to 4 in June and 3.5 in December 2010.
ArcelorMittal spent $3.8 billion on acquisitions since the start of 2008, according to data compiled by Bloomberg, to gain greater control over supplies of iron ore and coking coal.
The company, formed by the takeover of Arcelor SA by Mittal Steel Co. in 2006, produced 101.6 million tons of steel in 2008, 7.7 percent of the world total of 1.32 billion tons, the World Steel Association said on its Web site.
The second-quarter net loss was $792 million, or 57 cents a share, compared with net income of $5.84 billion, or $4.19, a year earlier, Luxembourg-based ArcelorMittal said today in a statement. The loss, which included $1.2 billion of inventory writedowns and provisions for job cuts, missed the $336 million median of eight analyst estimates compiled by Bloomberg. The shares slid as much as 7.9 percent, the most in two months.
“The second quarter was another challenging period,” Chief Executive Officer Lakshmi Mittal said in a conference call. “We are beginning to see more positive signals.”
ArcelorMittal, whose share price advanced 47 percent in the quarter, said this month it was restarting blast furnaces in Ghent in Belgium, Florange in France, and Gijon in Spain as customers buy steel to replace depleted inventories. The company shipped 17 million metric tons of steel in the second quarter, 43 percent less than a year earlier.
The shares were 1.025 euros lower at 24.30 euros as of 12:25 p.m. in Amsterdam trading. Earlier, they had their biggest intraday drop since May 21.
Higher Shipments
ArcelorMittal said today the first half will be “the bottom of the cycle.” The demand outlook is still “uncertain,” U.S. Steel Corp., the largest U.S. producer, said yesterday. Sweden’s SSAB Svenskt Staal AB posted its first loss in eight years on July 27 and said third-quarter earnings will be weaker. European demand is unlikely to recover until “well into 2010,” Moody’s Investors Service said last week.
ArcelorMittal forecast earnings before interest, tax, depreciation and amortization of $1.4 billion to $1.8 billion in the third quarter. Average steel selling prices will be stable or slightly lower, it said. Shipments will be least 1 million tons higher than in the second quarter, Chief Financial Officer Aditya Mittal said.
“If all the steelmakers increase production we’ll be back where we started,” Charlie Dove-Edwin, an analyst at MF Global UK Ltd. in London who has a “sell” recommendation on the stock, said by phone today. “There’s not enough real demand out here and making more steel will just send the price down.”
Return to Profit
Analysts predict a return to profit in the quarter as demand recovers and prices increase. The cost of hot-rolled coil, a benchmark steel product used in cars and construction, gained 4.2 percent in the second quarter, the first such increase in a year, according to data compiled by Metal Bulletin.
ArcelorMittal said it achieved annualized fixed-cost cuts of $8.4 billion at the end of the second quarter. Sales declined 60 percent to $15.2 billion.
The steelmaker said July 17 there was a “positive outcome” to its request to lenders to amend terms on $31 billion of loan facilities. The ratio of debt to Ebitda on the company’s principal facilities will rise to 4.5 in December and will fall to 4 in June and 3.5 in December 2010.
ArcelorMittal spent $3.8 billion on acquisitions since the start of 2008, according to data compiled by Bloomberg, to gain greater control over supplies of iron ore and coking coal.
The company, formed by the takeover of Arcelor SA by Mittal Steel Co. in 2006, produced 101.6 million tons of steel in 2008, 7.7 percent of the world total of 1.32 billion tons, the World Steel Association said on its Web site.
NIIT April-June net 2.1 million rupees
NIIT (NIIT.BO: Quote, Profile, Research) said on Wendesday its April-June net profit was 2.1 million rupees, on the net sales of 1.24 billion rupees.
The comparative year-ago figures were not immidiately available.
The comparative year-ago figures were not immidiately available.
Q1 RESULTS- Godrej, sterlite, cipla, hdil, pnb
GODREJ IND NET DOWN 68%
Consolidated net profit for Godrej Industries came in at Rs 16.4 crore (Rs 52.8 crore). Consolidated net sales stood at Rs 763 crore (RS 830 crore).
STERLITE'S NET FALLS 42%, SALES DOWN 21%
Low aluminium production saw Sterlite's net sales down 21% at Rs 4,537.11 crore (Rs 5,770 crore). Similarly net profit fell to Rs 924 crore (Rs 1,595 cr).
CIPLA NET SURGES BY 73%, SALES UP 13%
Cipla's profit went up by 73% to Rs 241.71 crore (Rs 140 crore). Net sales grew by 13% to Rs 1,325 crore (Rs 1,171 crore).
HDIL NET DIPS 66% AS SALES HALVES
HDIL's net profit declined 66% to Rs 107 crore as total income nearly halved to Rs 319 crore (Rs 601 crore).
PUNJAB NATIONAL BK NET ZOOMS 62%
Treasury gains and loan growth saw Punjab National Bank net profit zoom to Rs 832 crore (Rs 512 crore). Total income increased to Rs 6,175 crore (Rs 4,594 crore).
Consolidated net profit for Godrej Industries came in at Rs 16.4 crore (Rs 52.8 crore). Consolidated net sales stood at Rs 763 crore (RS 830 crore).
STERLITE'S NET FALLS 42%, SALES DOWN 21%
Low aluminium production saw Sterlite's net sales down 21% at Rs 4,537.11 crore (Rs 5,770 crore). Similarly net profit fell to Rs 924 crore (Rs 1,595 cr).
CIPLA NET SURGES BY 73%, SALES UP 13%
Cipla's profit went up by 73% to Rs 241.71 crore (Rs 140 crore). Net sales grew by 13% to Rs 1,325 crore (Rs 1,171 crore).
HDIL NET DIPS 66% AS SALES HALVES
HDIL's net profit declined 66% to Rs 107 crore as total income nearly halved to Rs 319 crore (Rs 601 crore).
PUNJAB NATIONAL BK NET ZOOMS 62%
Treasury gains and loan growth saw Punjab National Bank net profit zoom to Rs 832 crore (Rs 512 crore). Total income increased to Rs 6,175 crore (Rs 4,594 crore).
Microsoft, Yahoo in 10-year Web search partnership
NEW YORK (Reuters) - Microsoft Corp and Yahoo Inc inked a 10-year Web search deal to better compete against market leader Google Inc but stopped short of combining their display advertising businesses.
Shares of Yahoo, which had risen in recent weeks in anticipation of this deal, fell more than 7 percent in premarket trading, while shares of Microsoft edged higher.
The deal will boost Yahoo's annual operating income by about $500 million and yield capital expenditure savings of $200 million, the companies said in a joint statement on Wednesday.
Microsoft's Bing search engine will be the exclusive algorithmic search and paid search technology for Yahoo's sites, while Yahoo will be responsible for selling premium search ads for both companies.
Each company will maintain its own separate display advertising business and sales force, they said.
The deal combines the number two and number three players in the U.S. market for Internet search and positions them to better compete with Google, which has an estimated 65 percent share of the U.S. search market.
Shares of Yahoo, which had risen in recent weeks in anticipation of this deal, fell more than 7 percent in premarket trading, while shares of Microsoft edged higher.
The deal will boost Yahoo's annual operating income by about $500 million and yield capital expenditure savings of $200 million, the companies said in a joint statement on Wednesday.
Microsoft's Bing search engine will be the exclusive algorithmic search and paid search technology for Yahoo's sites, while Yahoo will be responsible for selling premium search ads for both companies.
Each company will maintain its own separate display advertising business and sales force, they said.
The deal combines the number two and number three players in the U.S. market for Internet search and positions them to better compete with Google, which has an estimated 65 percent share of the U.S. search market.
150 NH projects facing cost overrun: Kamal Nath
NEW DELHI: The Government on Wednesday said 150 National Highway development projects are facing cost overrun primarily due to delay in land acquisition, the Road Transport and Highways Minister, Mr Kamal Nath, informed the Rajya Sabha today.
The cost overrun were due to rise in prices of construction materials, delay in land acquisition, utility shifting and obtaining clearances from forest/environment, he said during Question Hour.
Poor performance of some contractors and law and order problems in some States were some other reasons. “There are huge cost overrun. These cost overrun are a matter of concern. Government is conscious of this,” he said adding structural efforts are bein g made to reduce cost overrun.
“I cannot say cost overrun will be eliminated but our endeavour is to see our cost estimates stay broadly within limits,” he said.
Admitting that cost estimates made by government agencies for road and highway projects were not accurate, he said “no policy has been made for fixing responsibility for this.” - PTI
The cost overrun were due to rise in prices of construction materials, delay in land acquisition, utility shifting and obtaining clearances from forest/environment, he said during Question Hour.
Poor performance of some contractors and law and order problems in some States were some other reasons. “There are huge cost overrun. These cost overrun are a matter of concern. Government is conscious of this,” he said adding structural efforts are bein g made to reduce cost overrun.
“I cannot say cost overrun will be eliminated but our endeavour is to see our cost estimates stay broadly within limits,” he said.
Admitting that cost estimates made by government agencies for road and highway projects were not accurate, he said “no policy has been made for fixing responsibility for this.” - PTI
SEBI bans over 350 entities in Alka Securities case
MUMBAI: SEBI has banned over 350 entities, including promoters of Alka Securities Ltd (ASL), from trading in securities with immediate effect on charges of manipulation of price and in the volume of shares traded of the stock- broking firm.
The market regulator has directed the National Securities Depository Ltd and the Central Depository Services (India) Ltd to freeze the beneficial owner accounts of the entities in the case of ASL.
The banned entities include ASL promoters Alka Pandey, Ravi Pandey, Mahesh Natvarlal Kothari, Anjuben Kothari, Brijesh Kothari, Dimple Kothari, Mahendra Pandey and Mayuresh Estate Agent.
In its preliminary findings, SEBI said the promoters used the off-market route to transfer the shares of the company to first level entities -- 42 in total -- which had either dealt in these shares on the Bombay Stock Exchange or transferred them to seco nd level entities -- 317 in all -- through the off-market route.
The second level entities had in turn dealt in the said shares at BSE, it said. Besides the ban on the promoters, first level and second level entities, SEBI in its interim order has directed BSE to inspect the stock brokers such as ICICI Securities, An and Rathi Financial and Motilal Oswal involved in the trade of ASL shares to ascertain the level of due diligence exercised by them. - PTI
The market regulator has directed the National Securities Depository Ltd and the Central Depository Services (India) Ltd to freeze the beneficial owner accounts of the entities in the case of ASL.
The banned entities include ASL promoters Alka Pandey, Ravi Pandey, Mahesh Natvarlal Kothari, Anjuben Kothari, Brijesh Kothari, Dimple Kothari, Mahendra Pandey and Mayuresh Estate Agent.
In its preliminary findings, SEBI said the promoters used the off-market route to transfer the shares of the company to first level entities -- 42 in total -- which had either dealt in these shares on the Bombay Stock Exchange or transferred them to seco nd level entities -- 317 in all -- through the off-market route.
The second level entities had in turn dealt in the said shares at BSE, it said. Besides the ban on the promoters, first level and second level entities, SEBI in its interim order has directed BSE to inspect the stock brokers such as ICICI Securities, An and Rathi Financial and Motilal Oswal involved in the trade of ASL shares to ascertain the level of due diligence exercised by them. - PTI
MFs declare div before Aug 1 to woo investors
30 MF schemes declare div before Aug 1 to woo new investors
30 Mutual Fund schemes will declare dividends before August 1 to woo new investors. Investing in Mutual Funds before the date will ensue entry load. The move comes after SEBI scapped entry load effective from August 1.
Most funds have fixed July 24 deadline for dividend eligibility, while 10 funds have fixed July 31 deadline.
30 Mutual Fund schemes will declare dividends before August 1 to woo new investors. Investing in Mutual Funds before the date will ensue entry load. The move comes after SEBI scapped entry load effective from August 1.
Most funds have fixed July 24 deadline for dividend eligibility, while 10 funds have fixed July 31 deadline.
HPCL Q1 net profit at Rs 649 cr
HPCL (Hindustan Petroleum Corporation) has announced its Q1FY10 numbers. The company has reported net profit of Rs 649 crore versus loss of Rs 888.1 crore, YoY.
Net sales declined to Rs 24,198 crore from Rs 34,749.3 crore.
Net sales declined to Rs 24,198 crore from Rs 34,749.3 crore.
LIC grabs 62% market share; private insurers slip in negative
New Delhi: The country’s largest insurer Life Insurance Corp. (LIC) has increased its market share to 62% among life insurers in the first quarter of current fiscal, thereby growing by about 20%, compared to same period last year.
According to Irda figures, LIC mopped up Rs9,028.68 crore in the first quarter of the current fiscal compared to Rs7,524 crore during the same period last year.
The country largest insurer increases it market share to about 62% from about 52% during the first quarter of the last fiscal.
Overall, the life-industry grew by about 1% in the first quarter of the current fiscal, with the life insurance companies’ premium rising mildly to Rs14,456.34 crore against Rs14,320.21 crore during the same period last year.
However, the private life insurers registered a negative growth of about 25% during the first three months of the current fiscal.
The 21 private life insurers managed to mop-up Rs5,427.67 crore in the first quarter of the current fiscal against Rs6795.64 crore during the same period last year.
SBI Life, the country’s largest private insurer saw its premium decline to Rs1,072.73 crore in the first three months against Rs1,148.67 crore raised during first quarter of the last fiscal.
While, ICICI Prudential’s premium dipped to Rs807.07 crore against Rs1,590.27 crore in the first three months of the last fiscal.
According to Irda figures, LIC mopped up Rs9,028.68 crore in the first quarter of the current fiscal compared to Rs7,524 crore during the same period last year.
The country largest insurer increases it market share to about 62% from about 52% during the first quarter of the last fiscal.
Overall, the life-industry grew by about 1% in the first quarter of the current fiscal, with the life insurance companies’ premium rising mildly to Rs14,456.34 crore against Rs14,320.21 crore during the same period last year.
However, the private life insurers registered a negative growth of about 25% during the first three months of the current fiscal.
The 21 private life insurers managed to mop-up Rs5,427.67 crore in the first quarter of the current fiscal against Rs6795.64 crore during the same period last year.
SBI Life, the country’s largest private insurer saw its premium decline to Rs1,072.73 crore in the first three months against Rs1,148.67 crore raised during first quarter of the last fiscal.
While, ICICI Prudential’s premium dipped to Rs807.07 crore against Rs1,590.27 crore in the first three months of the last fiscal.
Wockhardt to sell entire nutrition biz to Abbott
Deal may be worth Rs 625 cr, CDR divestment requirement met.
Wockhardt Ltd, which recently undertook a debt restructuring scheme, has signed an agreement to divest its non-core nutritional business to Abbott, a global healthcare company.
Sources said the deal was worth close to $130 million (Rs 625 crore). A Wockhardt spokesperson declined to confirm the size of the deal.
The company said the transaction was subject to customary closing conditions and various approvals, and would be closed in the second half of 2009.
The company’s nutrition business includes some of the major child care brands, such as Farex, Dexolac and Nusobee infant formulas, and Farex weaning cereal. The adult protein supplement, Protinex, is a segment leader in the vitamin and health supplement category.
Wockhardt had acquired Dumex India, along with its two products, Protinex and Farex, from Royal Numico NV of The Netherlands for an undisclosed amount in 2006. At that time, Protinex and Farex, both well-known nutrition brands in the country for over 50 years, had a combined annual sales of Rs 60 crore.
“At Wockhardt, we invested and nurtured to build a valuable brand equity for these heritage brands and it was time now for a specialised nutrition-focused company, as Abbott, to be able to leverage its full potential in the global markets,” said Wockhardt Chairman Habil Khorakiwala.
Wockhardt’s over Rs 3,400 crore debt was restructured by its lenders in June. As per the corporate debt restructuring (CDR) scheme, it has to divest its non-core assets at an estimated value of Rs 790 crore, within the next six years. It had already mobilised close to Rs 300 crore from the recent sale of its loss-making German subsidiary, Esparma, to Mova GmbH and the animal health division to Vétoquinol, a French veterinary care company.
With these sales, the company is likely to go slow on sale of other assets it had put on the block, including its plans of divesting the proposed stake sale of its hospital chain, as the CDR package approved by its lenders have taken care of the company’s immediate financial commitments.
The company is also looking at divesting a 32-acre dairy and milk processing unit in Punjab which the company inherited from its acquisition of Dumex India and part of 250 acres in Aurngabad. Wockhardt’s promoter, Habil Khorakiwala, was also planning to divest less than 26 per cent stake in Wockhardt Hospitals, which has 12 hospitals, for a valuation of Rs 800-1,200 crore. But the company may wait for more time to get good valuations, said sources.
Wockhardt Ltd, which recently undertook a debt restructuring scheme, has signed an agreement to divest its non-core nutritional business to Abbott, a global healthcare company.
Sources said the deal was worth close to $130 million (Rs 625 crore). A Wockhardt spokesperson declined to confirm the size of the deal.
The company said the transaction was subject to customary closing conditions and various approvals, and would be closed in the second half of 2009.
The company’s nutrition business includes some of the major child care brands, such as Farex, Dexolac and Nusobee infant formulas, and Farex weaning cereal. The adult protein supplement, Protinex, is a segment leader in the vitamin and health supplement category.
Wockhardt had acquired Dumex India, along with its two products, Protinex and Farex, from Royal Numico NV of The Netherlands for an undisclosed amount in 2006. At that time, Protinex and Farex, both well-known nutrition brands in the country for over 50 years, had a combined annual sales of Rs 60 crore.
“At Wockhardt, we invested and nurtured to build a valuable brand equity for these heritage brands and it was time now for a specialised nutrition-focused company, as Abbott, to be able to leverage its full potential in the global markets,” said Wockhardt Chairman Habil Khorakiwala.
Wockhardt’s over Rs 3,400 crore debt was restructured by its lenders in June. As per the corporate debt restructuring (CDR) scheme, it has to divest its non-core assets at an estimated value of Rs 790 crore, within the next six years. It had already mobilised close to Rs 300 crore from the recent sale of its loss-making German subsidiary, Esparma, to Mova GmbH and the animal health division to Vétoquinol, a French veterinary care company.
With these sales, the company is likely to go slow on sale of other assets it had put on the block, including its plans of divesting the proposed stake sale of its hospital chain, as the CDR package approved by its lenders have taken care of the company’s immediate financial commitments.
The company is also looking at divesting a 32-acre dairy and milk processing unit in Punjab which the company inherited from its acquisition of Dumex India and part of 250 acres in Aurngabad. Wockhardt’s promoter, Habil Khorakiwala, was also planning to divest less than 26 per cent stake in Wockhardt Hospitals, which has 12 hospitals, for a valuation of Rs 800-1,200 crore. But the company may wait for more time to get good valuations, said sources.
Hero Honda achieves highest quarterly sales, surpasses a million mark
Riding on record million unit sales, Hero Honda, the world’s largest two-wheeler manufacturer, has reported its best ever quarterly earnings of all time. The company posted a net profit at Rs 500.11 crore, a rise of 83 per cent from Rs 272.87 crore in the corresponding period of the last year.
The company first time crossed its product sales surpassing one million mark at 11,18,987 units of two-wheelers thereby, generating a turnover of Rs 3822.44 crore, a rise of 34 per cent over Rs 2,851.04 crore in the corresponding period last year. The EBITDA margin of 17 per cent in the first quarter is a recorded high from the level of 12.23 per cent in the comparable quarter of the previous fiscal.
With over 59 per cent market share in the domestic motorcycle market and with sales of over a million units in the quarter, the robust topline growth has largely contributed to the strong bottomline performance. Several other key factors such as cost rationalisation across the board, softening of commodity prices, and tax benefits also contributed to the bottomline. The current quarter reflects a substantial tax benefit accrued on account of the company’s full utilisation of the tax benefits available for the Haridwar plant, which resulted in bringing down the overall tax rate.
The consistent robust topline performance has been driven by volume growth across segments and markets, aggressive brand building initiatives and rapid network expansion, reflecting the strong brands and continued expansion of new markets.
Most of the recent launches such as Passion Pro, Splendor NXG self-start, the special edition Hunk, the new Pleasure, in addition to the trusted Splendor plus and Passion Plus, have been share-and-volume drivers for the company. Hunk and CBZ X-treme continue to help build on Hero Honda’s steadily growing share in the premium segment.
The company first time crossed its product sales surpassing one million mark at 11,18,987 units of two-wheelers thereby, generating a turnover of Rs 3822.44 crore, a rise of 34 per cent over Rs 2,851.04 crore in the corresponding period last year. The EBITDA margin of 17 per cent in the first quarter is a recorded high from the level of 12.23 per cent in the comparable quarter of the previous fiscal.
With over 59 per cent market share in the domestic motorcycle market and with sales of over a million units in the quarter, the robust topline growth has largely contributed to the strong bottomline performance. Several other key factors such as cost rationalisation across the board, softening of commodity prices, and tax benefits also contributed to the bottomline. The current quarter reflects a substantial tax benefit accrued on account of the company’s full utilisation of the tax benefits available for the Haridwar plant, which resulted in bringing down the overall tax rate.
The consistent robust topline performance has been driven by volume growth across segments and markets, aggressive brand building initiatives and rapid network expansion, reflecting the strong brands and continued expansion of new markets.
Most of the recent launches such as Passion Pro, Splendor NXG self-start, the special edition Hunk, the new Pleasure, in addition to the trusted Splendor plus and Passion Plus, have been share-and-volume drivers for the company. Hunk and CBZ X-treme continue to help build on Hero Honda’s steadily growing share in the premium segment.
LS adjourned thrice over Ambani brothers’ row
The Ambani brothers’ gas dispute echoed in the Lok Sabha today with some members demanding the resignation of petroleum minister Murli Deora, forcing adjournment of the house.
The Samajwadi Party members, led by president Mulayam Singh Yadav, demanded resignation of Deora over the government's failure to ensure supply of gas for the Dadri Power project in Uttar Pradesh.
Grave injustice is being done to Uttar Pradesh by denying gas to the Dadri Power plant and this in turn could cost the national exchequer Rs30,000 crore, Yadav contended.
Anil Ambani had yesterday hit out at the petroleum ministry for colluding with elder brother Mukesh's RIL in blocking gas supply for its power projects despite a firm commitment, upheld thrice by the Bombay High Court.
With SP members rushing to the Well of the House and creating an uproar, the House witnessed two adjournments till the lunch recess.
While Yadav or other SP members did not name the Ambani brothers nor the fight between them, the reference to Dadri project and resignation of the petroleum minister was indication enough of their plea.
The issue was raised by Yadav soon after the House met for Question Hour. He was highly critical of the petroleum minister and demanded a statement from the government on the issue.
Finance minister Pranab Mukherjee had yesterday called a meeting with Deora and law minister Veerappa Moily after Anil openly charged the oil ministry with siding with RIL to help it renege commitments on gas supply to NTPC and his group's firm RNRL.
The Supreme Court will on September one consider admissibility of a government petition seeking annulment of a gas supply pact between RIL-RNRL.
SP members Reoti Raman Singh and Shailendra Kumar demanded resignation of Deora.
When Yadav sought to raise the issue again after Question Hour, speaker Meira Kumar disallowed him telling the SP leader would not get another chance.
As SP members rushed to the Well, the speaker adjourned the House for 15 minutes. It was similar story when the House reassembled when Sumitra Mahajan was in the Chair. She adjourned the House till 2:00 p.m.
The Samajwadi Party members, led by president Mulayam Singh Yadav, demanded resignation of Deora over the government's failure to ensure supply of gas for the Dadri Power project in Uttar Pradesh.
Grave injustice is being done to Uttar Pradesh by denying gas to the Dadri Power plant and this in turn could cost the national exchequer Rs30,000 crore, Yadav contended.
Anil Ambani had yesterday hit out at the petroleum ministry for colluding with elder brother Mukesh's RIL in blocking gas supply for its power projects despite a firm commitment, upheld thrice by the Bombay High Court.
With SP members rushing to the Well of the House and creating an uproar, the House witnessed two adjournments till the lunch recess.
While Yadav or other SP members did not name the Ambani brothers nor the fight between them, the reference to Dadri project and resignation of the petroleum minister was indication enough of their plea.
The issue was raised by Yadav soon after the House met for Question Hour. He was highly critical of the petroleum minister and demanded a statement from the government on the issue.
Finance minister Pranab Mukherjee had yesterday called a meeting with Deora and law minister Veerappa Moily after Anil openly charged the oil ministry with siding with RIL to help it renege commitments on gas supply to NTPC and his group's firm RNRL.
The Supreme Court will on September one consider admissibility of a government petition seeking annulment of a gas supply pact between RIL-RNRL.
SP members Reoti Raman Singh and Shailendra Kumar demanded resignation of Deora.
When Yadav sought to raise the issue again after Question Hour, speaker Meira Kumar disallowed him telling the SP leader would not get another chance.
As SP members rushed to the Well, the speaker adjourned the House for 15 minutes. It was similar story when the House reassembled when Sumitra Mahajan was in the Chair. She adjourned the House till 2:00 p.m.
Sensex ends lower; realty, metals, FMCG, infra, banks dip
The Sensex ended lower on the back of fall in shares of metal, realty, power, capital goods, telecom and banking companies, after seeing a recovery of around 285 points from the day's low of 14,888.41. Volumes remained above the Rs 1 lakh crore for second consecutive day. The markets were extemely volatile ahead of July settlement on Thursday.
Equity benchmarks were flat for the first two hours of trade. But they saw sharp fall after 12 hours IST following more than 7.5% fall in Shanghai, which managed to show some recovery and ended with 5% loss on the back of sell-off in property and steel shares. Investors booked profits as they worried that banks may restrict lending to control risks that threaten on asset bubble. Chinese government also reduced gasoline prices.
Among the other Asian markets, Hang Seng fell 2.4%. Jakarta, Straits Times and Taiwan Weighted were down 0.5-0.8%. Nikkei and Kospi were flat.
However, the markets managed to show smart recovery post the European markets' positive opening, which rose 0.7-1.5%. The 50-share NSE Nifty saw recovery of 92.7 points from day's low of 4420.80, before closing at 4513.50, down 1.11% or 50.60 points. The 30-share BSE Sensex fell 158.48 points or 1.03%, to settle at 15,173.46. The Nifty July futures closed with 17.3 points discount and August futures with 5.5 points discount.
Sudarshan Sukhani of Technical Trends said, "Traders should be very careful and cautious, investors can as well wait for either 4,700 to be broken or for a deeper correction. These are volatile areas and not much is going to come out between 4,400 and 4,700."
The markets recorded highest turnover ever; total turnover increased 39% to Rs 1,47,352.24 crore as against Rs 1,05,933.55 crore. This included Rs 23,333.69 crore from the NSE cash segment, Rs 1,16,508.34 crore from the NSE F&O and the balance Rs 7,510.21 crore from the BSE cash segment.
The market breadth was negative; about 1,144 shares advanced while 1,639 shares declined on the BSE. Nearly 387 shares remained unchanged. The broader indices fell 1-1.5%.
All the sectoral indices ended in red barring Oil & Gas and IT. The BSE Realty Index underperformed other indices, fell 4.4%. The Metal and FMCG indices declined 2% each. Fall in property and metal shares in Chinese markets had some ripple effects on our markets as well.
In the realty space, HDIL, Omaxe, DLF, Ansal Properties, Parsvnath and Unitech were down 5-7%.
Metal stocks like Tata Steel, Sterlite Industries (revenues were below estimates while profit was better-than-expectations) and SAIL lost 4.57-5.8%. NMDC, Sesa Goa and Hindustan Zinc lost 2.4-2.9%. However, Jindal Steel was up 3.41%. Hindalco and JSW Steel were up 0.5-1.3%.
In the FMCG space, Nestle, United Spirits, United Breweries, HUL, ITC and Marico declined 1-5.5%.
Capital goods stocks like ABB, L&T and BHEL were down 1-4%. In the power pack, Suzlon Energy, Reliance Infrastructure, Lanco Infratech, Neyveli Lignite, GMR Infra, Reliance Power, NTPC and GVK Power lost 1-5%.
In the pharma space, Wockhardt, Sun Pharma (disappointing numbers for Q1FY10) and Glenmark were down 4-5.5%. Cipla, Biocon and Apollo Hospital slipped 1.4-2.9%. However, Ranbaxy Labs, Matrix Lab and Dr Reddys Labs were up 0.4-0.7%.
Banking stocks like Kotak Mahindra, Axis Bank, SBI and ICICI Bank went down 1-5.8%. HDFC Bank was down 0.51% while PNB surged 3.45% on good set of numbers for Q1FY10 (numbers were above estimates).
In the auto space, Tata Motors plunged 4.96%. Hero Honda, Bharat Forge, Bajaj Auto and Ashok Leyland lost 1-2% while M&M was up 2.31% and Maruti Suzuki gained 0.55%.
In the telecom pack, MTNL, Tata Teleservices, Reliance Communication, Idea Cellular and Bharti Airtel declined 1-3.5%.
In the oil & gas space, IOC, BPCL, Reliance Petroleum, HPCL and Reliance Industries were up 0.8-1.5%. However, GAIL and
Cairn India fell over 2.5%.
Among the technology stocks, TCS shot up 4.18% and Wipro up 0.58%. However, HCL Tech lost 2.42% and Infosys down 0.55%.
In the midcap space, Gujarat Gas, Deccan Chronicle, Kansai Nerolac, Balrampur Chini and Jubilant were up 6.5-14% while Amtek Auto, IVRCL Infrastructure and Reliance Industrial Infra fell 6.5-7.5%.
In the smallcap space, VIP Industries, TVS Motor, Goodricke Group, EIH Associated Hotel and Rico Auto gained 10-20% while Vishal Info, NIIT Tech, Marathon Nextgen, Oil Country and ABG Infralogistics slipped 8-19.5%.
At 14:06 hours IST - the Sensex continued to trade lower despite showing recovery over 250 points. The Nifty has recovered over 70 points from day's low. Realty, banking, metal, power, telecom, capital goods and FMCG stocks were still seeing selling pressure. There was a huge volatility.
However, Jindal Steel, which surged over 6%. TCS and PNB gained over 2%. Wipro, M&M, Maruti, BPCL and Ranbaxy Labs went up 0.5-1.5%. About 0.8-1.5% upside in European markets also helped in the recovery.
The Nifty was down 62 points, to 4,503 and the Sensex fell 193 points, to 15,138. The broader indices slipped over 1%.
In the largecaps, DLF, Sun Pharma, SAIL, Unitech and Tata Steel were down over 6%. Suzlon Energy, Axis Bank, Tata Motors, Sterlite Industries and Reliance Infrastructure fell 4-5.5%.
Cipla, ABB, Reliance Capital, Idea Cellular, Cairn India, L&T, GAIL, HUL, Reliance Communication, Hindalco, SBI, HCL Tech and ACC were down 2-3.7%.
The market breadth was negative; about 1000 shares advanced while 1754 shares declined on the BSE. Nearly 416 shares were unchanged.
Nifty trades sharply lower; Realty, Metal indices tank 4-5%
At 13:15 hours IST - the sell-off in metal, realty, infrastructure, banking, cement, telecom and FMCG stocks was putting pressure on the Nifty, which was trading below the 4500 level. The Sensex was hovering around the 15,000 mark.
About 5% fall in China's Shanghai and 3% slide in Hong Kong's Hang Seng weighed on our markets. Property and steel shares tumbled in Chinese markets. Chinese government cut gasoline prices. Investors worried that banks may restrict lending to control risks. Crude also slipped 2% below USD 66 a barrel.
The Sensex was down 289 points, to 15,046 and the Nifty fell 98 points, to 4,465. The market breadth was negative; about 264 shares advanced while 968 shares declined on the NSE. The broader indices lost over 2%.
All sectoral indices were in the red. The BSE Metal and Realty indices lost over 5%. Power, FMCG, Capital Goods and Bank indices fell 2-3%.
In the realty space, Omaxe, Parsvnath, HDIL, DLF, Unitech and Ansal Properties were down 6.7-9%.
Metal stocks like SAIL, Ispat Industries, Sterlite, Tata Steel, Hindalco, Gujarat NRE Coke and JSW Steel lost 5-7%. Sesa Goa, Jindal Steel, Welspun Gujarat, Hindustan Zinc, NMDC and Jindal Saw declined 2-4%.
In the power space, Suzlon Energy, Reliance Infrastructure, GVK Power, ABB, GMR Infra, Neyveli Lignite, Lanco Infratech, Reliance Power, NTPC, BHEL and Tata Power slipped 2-5%.
In the midcap space, Gujarat Gas, Carborundum, Kansai Nerolac, Birla Corp and Great Offshore were up 4.5-14% while Essar Shipping and Godfrey Phillip fell over 7%.
In the smallcap space, VIP Industries jumped 20%. EIH Associated Hotel, Revathi CP, Rico Auto and Hinduja Global were up 6-9.5% while Vishal Info, Oil Country, NIIT Tech, Action Construction and Kewal Kiran tanked 8-17%.
Sensex down 300 pts; HK, China down on asset bubble worries
At 12.36 hours IST - the Sensex was witnessing huge selling pressure following big slide in Asian markets. Shanghai Composite tanked 5% led by fall in property and steel shares. Chinese government cut gasoline prices. Hang Seng and Straits Times slipped 1.6-2%.
Shares of China Petroleum & Chemical and PetroChina fell in Hong Kong after China unexpectedly cut fuel prices. Sinopec slipped 3% while PetroChina lost 2%.
Realty, metal, telecom, FMCG, power and capital goods stocks were the major losers.
At 12.36 hrs IST, the Sensex was down 330.84 points or 2.16% at 15001.10, and the Nifty was down 102.95 points or 2.26% at 4461.15.
About 843 shares advanced, 1895 shares declined, and 432 shares were unchanged. Only three stocks - TCS, Ranbaxy and PNB were in the green on the Nifty.
In the largecaps, DLF was at Rs 395, down 7.3%; Tata Motors was at Rs 385, down 7.05%; Sterlite Industries was at Rs 611.25, down 7.03%; Reliance Infrastructure was at Rs 1,142, down 5.62%; Tata Steel was at Rs 443, down 5.53% and Unitech was at Rs 89.25, down 6.74%.
All sectoral indices were in the red. The BSE Realty Index tanked 7% and Metal Index fell 6%. Power, FMCG, Capital Goods, Bank, Healthcare and Auto indices were down 2-4%.
Nifty flat; banks, realty, metals dip, oil & gas, cement up
At 10:52 hours IST, the Nifty was extremely volatile in trade. Buying in oil & gas, telecom, cement and select auto stocks along with HDFC, TCS and Tata Power was supporting the markets.
However, selling continued in realty, metal and banking stocks along with BHEL, Infosys and Sun Pharma.
The Sensex was up just 7 points, to 15,339 while the Nifty fell 5 points, to 4,558. However, the broader indices were up 0.8% each. About 1604 shares advanced while 1087 shares declined on the BSE. Nearly 479 shares were unchanged.
Top gainers - M&M, ONGC, Hero Honda, TCS, Tata Power and Ranbaxy Labs were up 1.4-3%.
Top losers - Tata Motors, DLF, Sun Pharma, SBI, Tata Steel and Axis Bank slipped 1-3%.
Aban Offshore, Great Offshore, RNRL, Unitech, Tata Steel and Reliance Industries were most active shares on the bourses.
In the midcap space, Gujarat Gas surged 15.79%. Kansai Nerolac, Jubilant, Torrent Pharma and Patni Computer gained 5-7.5%. However, Godfrey Phillip, Everest Kanto, Monsanto India, HDIL and Gammon Infra declined 3-6%.
In the smallcap space, VIP Industries shot up 19.94%. TVS Motor, EIH Associated Hotel, Marathon Nextgen and Bliss GVS were up 10-12%. However, Gammon India, GSFC, Clariant, GMR Industries and Sundaram-Clayton lost 4.5-5.5%.
Sensex weak on negative Asian cues; metals dip
The Sensex opened weak on the back of negative Asian cues. Metal, realty, infrastructure and select banking stocks were under pressure. There was some volatility ahead of F&O expiry on Thursday.
At 9:56 am, the Nifty fell 32 points, to 4,531 and the Sensex slipped 102 points, to 15,229. The CNX Midcap declined 14 points, to 5,886 and the BSE Smallcap Index fell 10 points, to 6,235.
Among the frontliners, Cairn (ahead of numbers), Tata Steel (ahead of numbers), Suzlon Energy, DLF, SAIL, Tata Motors, ICICI Bank, HDFC, Jindal Steel & Power, SBI, Axis Bank, Sun Pharma (ahead of numbers), Wipro, Reliance Capital, Reliance Infrastructure, NTPC and Bharti Airtel were down 1-2.5%.
Cipla was up 2.4% and Hero Honda up over 1% ahead of Q1FY10 numbers. BPCL was up 1.7% on good set of numbers.
Maruti Suzuki, Ambuja Cements, GAIL and HUL were the other gainers.
Midcap space:
Kingfisher Airlines was up 4% on fund raising plans. Great Offshore rose 3%.
Gujarat Gas was up 1% as the company announced bonus and EBITDA numbers were good as well.
Balrampur Chini and Bajaj Hindusthan were also up.
Gammon India was down 7.5%.
GVK Power and Punj Lloyd were other losers.
Alembic shot up 6% on good numbers. Firstsource was up 3% as its numbers were ahead of estimates.
Maytas Infra and Mcleod Russel were up 3% each.
Global cues:
Asian markets were trading lower. Shanghai and Hang Seng fell 1.7% each. Straits Times and Taiwan Weighted declined 0.5% each. Nikkei and Kospi were flat in trade.
The US markets recovered from the day's low amid mix economic data. Commodities declined as USD rebounded.
The Dow Jones Industrial Average ended down 12 points at 9,097, after seeing recovery of 90 points from day's low of 9,007.
The Nasdaq Composite was up 7.6 points at 1,976, after seeing recovery of 28 points from day's low of 1,948 and the S&P 500 Index was down 2.5 points at 980, after seeing recovery of 10 points from day's low of 970.
Commodities:
The CRB Index was down 1%.
Crude declined 1.7% at $67.23/bbl.
LME metals index was down 1.2%.
Copper was down 1%, Nickel down 2%, Tin down 3% and Zinc down 2%.
Gold was down 1.7% at $938/ounce, at 1-week lows.
Baltic Dry index was up 2%.
Market cues:
-FIIs net buy USD 92.5 million in equity on July 27
-MFs net sell Rs 176.8 crore in equity on July 27
-NSE F&O Open Int up by Rs 1960 crore at Rs 96,180 crore
-FII turnover as a % of Total F&O turnover at 27.7% versus 17.6%
-FIIs net buy Rs 59 crore in cash markets on July 28 (Prov)
-DIIs net buy Rs 448 crore in cash markets on July 28 (Prov)
-FIIs net sell Rs 670 crore in F&O on July 28
F&O cues:
-Stock Futures add 51 lakh shares in Open Int
-Futures Open Int up by Rs 1171 crore and Options Open Int up by Rs 789 crore
-Nifty July Futures shed 26.7 lakh shares in Open Int
-Nifty Aug Futures add 41.4 lakh shares in Open Int
-Nifty Aug Futures at 10-pt premium versus 11-pt premium
-Nifty IVs at 34-37%
-Nifty Open Int Put Call Ratio remains at 1.31
-Nifty Puts add 7.7 lakh shares in Open Int
-Nifty Calls add 6.2 lakh shares in Open Int
-Nifty August 4500 Put adds 3.75 lakh shares in Open Int
-Nifty August 4600 Put adds 3.4 lakh shares in Open Int
-Nifty July 4600 Call adds 3.4 lakh shares in Open Int
-Nifty August 4600 Call adds 2.6 lakh shares in Open Int
Equity benchmarks were flat for the first two hours of trade. But they saw sharp fall after 12 hours IST following more than 7.5% fall in Shanghai, which managed to show some recovery and ended with 5% loss on the back of sell-off in property and steel shares. Investors booked profits as they worried that banks may restrict lending to control risks that threaten on asset bubble. Chinese government also reduced gasoline prices.
Among the other Asian markets, Hang Seng fell 2.4%. Jakarta, Straits Times and Taiwan Weighted were down 0.5-0.8%. Nikkei and Kospi were flat.
However, the markets managed to show smart recovery post the European markets' positive opening, which rose 0.7-1.5%. The 50-share NSE Nifty saw recovery of 92.7 points from day's low of 4420.80, before closing at 4513.50, down 1.11% or 50.60 points. The 30-share BSE Sensex fell 158.48 points or 1.03%, to settle at 15,173.46. The Nifty July futures closed with 17.3 points discount and August futures with 5.5 points discount.
Sudarshan Sukhani of Technical Trends said, "Traders should be very careful and cautious, investors can as well wait for either 4,700 to be broken or for a deeper correction. These are volatile areas and not much is going to come out between 4,400 and 4,700."
The markets recorded highest turnover ever; total turnover increased 39% to Rs 1,47,352.24 crore as against Rs 1,05,933.55 crore. This included Rs 23,333.69 crore from the NSE cash segment, Rs 1,16,508.34 crore from the NSE F&O and the balance Rs 7,510.21 crore from the BSE cash segment.
The market breadth was negative; about 1,144 shares advanced while 1,639 shares declined on the BSE. Nearly 387 shares remained unchanged. The broader indices fell 1-1.5%.
All the sectoral indices ended in red barring Oil & Gas and IT. The BSE Realty Index underperformed other indices, fell 4.4%. The Metal and FMCG indices declined 2% each. Fall in property and metal shares in Chinese markets had some ripple effects on our markets as well.
In the realty space, HDIL, Omaxe, DLF, Ansal Properties, Parsvnath and Unitech were down 5-7%.
Metal stocks like Tata Steel, Sterlite Industries (revenues were below estimates while profit was better-than-expectations) and SAIL lost 4.57-5.8%. NMDC, Sesa Goa and Hindustan Zinc lost 2.4-2.9%. However, Jindal Steel was up 3.41%. Hindalco and JSW Steel were up 0.5-1.3%.
In the FMCG space, Nestle, United Spirits, United Breweries, HUL, ITC and Marico declined 1-5.5%.
Capital goods stocks like ABB, L&T and BHEL were down 1-4%. In the power pack, Suzlon Energy, Reliance Infrastructure, Lanco Infratech, Neyveli Lignite, GMR Infra, Reliance Power, NTPC and GVK Power lost 1-5%.
In the pharma space, Wockhardt, Sun Pharma (disappointing numbers for Q1FY10) and Glenmark were down 4-5.5%. Cipla, Biocon and Apollo Hospital slipped 1.4-2.9%. However, Ranbaxy Labs, Matrix Lab and Dr Reddys Labs were up 0.4-0.7%.
Banking stocks like Kotak Mahindra, Axis Bank, SBI and ICICI Bank went down 1-5.8%. HDFC Bank was down 0.51% while PNB surged 3.45% on good set of numbers for Q1FY10 (numbers were above estimates).
In the auto space, Tata Motors plunged 4.96%. Hero Honda, Bharat Forge, Bajaj Auto and Ashok Leyland lost 1-2% while M&M was up 2.31% and Maruti Suzuki gained 0.55%.
In the telecom pack, MTNL, Tata Teleservices, Reliance Communication, Idea Cellular and Bharti Airtel declined 1-3.5%.
In the oil & gas space, IOC, BPCL, Reliance Petroleum, HPCL and Reliance Industries were up 0.8-1.5%. However, GAIL and
Cairn India fell over 2.5%.
Among the technology stocks, TCS shot up 4.18% and Wipro up 0.58%. However, HCL Tech lost 2.42% and Infosys down 0.55%.
In the midcap space, Gujarat Gas, Deccan Chronicle, Kansai Nerolac, Balrampur Chini and Jubilant were up 6.5-14% while Amtek Auto, IVRCL Infrastructure and Reliance Industrial Infra fell 6.5-7.5%.
In the smallcap space, VIP Industries, TVS Motor, Goodricke Group, EIH Associated Hotel and Rico Auto gained 10-20% while Vishal Info, NIIT Tech, Marathon Nextgen, Oil Country and ABG Infralogistics slipped 8-19.5%.
At 14:06 hours IST - the Sensex continued to trade lower despite showing recovery over 250 points. The Nifty has recovered over 70 points from day's low. Realty, banking, metal, power, telecom, capital goods and FMCG stocks were still seeing selling pressure. There was a huge volatility.
However, Jindal Steel, which surged over 6%. TCS and PNB gained over 2%. Wipro, M&M, Maruti, BPCL and Ranbaxy Labs went up 0.5-1.5%. About 0.8-1.5% upside in European markets also helped in the recovery.
The Nifty was down 62 points, to 4,503 and the Sensex fell 193 points, to 15,138. The broader indices slipped over 1%.
In the largecaps, DLF, Sun Pharma, SAIL, Unitech and Tata Steel were down over 6%. Suzlon Energy, Axis Bank, Tata Motors, Sterlite Industries and Reliance Infrastructure fell 4-5.5%.
Cipla, ABB, Reliance Capital, Idea Cellular, Cairn India, L&T, GAIL, HUL, Reliance Communication, Hindalco, SBI, HCL Tech and ACC were down 2-3.7%.
The market breadth was negative; about 1000 shares advanced while 1754 shares declined on the BSE. Nearly 416 shares were unchanged.
Nifty trades sharply lower; Realty, Metal indices tank 4-5%
At 13:15 hours IST - the sell-off in metal, realty, infrastructure, banking, cement, telecom and FMCG stocks was putting pressure on the Nifty, which was trading below the 4500 level. The Sensex was hovering around the 15,000 mark.
About 5% fall in China's Shanghai and 3% slide in Hong Kong's Hang Seng weighed on our markets. Property and steel shares tumbled in Chinese markets. Chinese government cut gasoline prices. Investors worried that banks may restrict lending to control risks. Crude also slipped 2% below USD 66 a barrel.
The Sensex was down 289 points, to 15,046 and the Nifty fell 98 points, to 4,465. The market breadth was negative; about 264 shares advanced while 968 shares declined on the NSE. The broader indices lost over 2%.
All sectoral indices were in the red. The BSE Metal and Realty indices lost over 5%. Power, FMCG, Capital Goods and Bank indices fell 2-3%.
In the realty space, Omaxe, Parsvnath, HDIL, DLF, Unitech and Ansal Properties were down 6.7-9%.
Metal stocks like SAIL, Ispat Industries, Sterlite, Tata Steel, Hindalco, Gujarat NRE Coke and JSW Steel lost 5-7%. Sesa Goa, Jindal Steel, Welspun Gujarat, Hindustan Zinc, NMDC and Jindal Saw declined 2-4%.
In the power space, Suzlon Energy, Reliance Infrastructure, GVK Power, ABB, GMR Infra, Neyveli Lignite, Lanco Infratech, Reliance Power, NTPC, BHEL and Tata Power slipped 2-5%.
In the midcap space, Gujarat Gas, Carborundum, Kansai Nerolac, Birla Corp and Great Offshore were up 4.5-14% while Essar Shipping and Godfrey Phillip fell over 7%.
In the smallcap space, VIP Industries jumped 20%. EIH Associated Hotel, Revathi CP, Rico Auto and Hinduja Global were up 6-9.5% while Vishal Info, Oil Country, NIIT Tech, Action Construction and Kewal Kiran tanked 8-17%.
Sensex down 300 pts; HK, China down on asset bubble worries
At 12.36 hours IST - the Sensex was witnessing huge selling pressure following big slide in Asian markets. Shanghai Composite tanked 5% led by fall in property and steel shares. Chinese government cut gasoline prices. Hang Seng and Straits Times slipped 1.6-2%.
Shares of China Petroleum & Chemical and PetroChina fell in Hong Kong after China unexpectedly cut fuel prices. Sinopec slipped 3% while PetroChina lost 2%.
Realty, metal, telecom, FMCG, power and capital goods stocks were the major losers.
At 12.36 hrs IST, the Sensex was down 330.84 points or 2.16% at 15001.10, and the Nifty was down 102.95 points or 2.26% at 4461.15.
About 843 shares advanced, 1895 shares declined, and 432 shares were unchanged. Only three stocks - TCS, Ranbaxy and PNB were in the green on the Nifty.
In the largecaps, DLF was at Rs 395, down 7.3%; Tata Motors was at Rs 385, down 7.05%; Sterlite Industries was at Rs 611.25, down 7.03%; Reliance Infrastructure was at Rs 1,142, down 5.62%; Tata Steel was at Rs 443, down 5.53% and Unitech was at Rs 89.25, down 6.74%.
All sectoral indices were in the red. The BSE Realty Index tanked 7% and Metal Index fell 6%. Power, FMCG, Capital Goods, Bank, Healthcare and Auto indices were down 2-4%.
Nifty flat; banks, realty, metals dip, oil & gas, cement up
At 10:52 hours IST, the Nifty was extremely volatile in trade. Buying in oil & gas, telecom, cement and select auto stocks along with HDFC, TCS and Tata Power was supporting the markets.
However, selling continued in realty, metal and banking stocks along with BHEL, Infosys and Sun Pharma.
The Sensex was up just 7 points, to 15,339 while the Nifty fell 5 points, to 4,558. However, the broader indices were up 0.8% each. About 1604 shares advanced while 1087 shares declined on the BSE. Nearly 479 shares were unchanged.
Top gainers - M&M, ONGC, Hero Honda, TCS, Tata Power and Ranbaxy Labs were up 1.4-3%.
Top losers - Tata Motors, DLF, Sun Pharma, SBI, Tata Steel and Axis Bank slipped 1-3%.
Aban Offshore, Great Offshore, RNRL, Unitech, Tata Steel and Reliance Industries were most active shares on the bourses.
In the midcap space, Gujarat Gas surged 15.79%. Kansai Nerolac, Jubilant, Torrent Pharma and Patni Computer gained 5-7.5%. However, Godfrey Phillip, Everest Kanto, Monsanto India, HDIL and Gammon Infra declined 3-6%.
In the smallcap space, VIP Industries shot up 19.94%. TVS Motor, EIH Associated Hotel, Marathon Nextgen and Bliss GVS were up 10-12%. However, Gammon India, GSFC, Clariant, GMR Industries and Sundaram-Clayton lost 4.5-5.5%.
Sensex weak on negative Asian cues; metals dip
The Sensex opened weak on the back of negative Asian cues. Metal, realty, infrastructure and select banking stocks were under pressure. There was some volatility ahead of F&O expiry on Thursday.
At 9:56 am, the Nifty fell 32 points, to 4,531 and the Sensex slipped 102 points, to 15,229. The CNX Midcap declined 14 points, to 5,886 and the BSE Smallcap Index fell 10 points, to 6,235.
Among the frontliners, Cairn (ahead of numbers), Tata Steel (ahead of numbers), Suzlon Energy, DLF, SAIL, Tata Motors, ICICI Bank, HDFC, Jindal Steel & Power, SBI, Axis Bank, Sun Pharma (ahead of numbers), Wipro, Reliance Capital, Reliance Infrastructure, NTPC and Bharti Airtel were down 1-2.5%.
Cipla was up 2.4% and Hero Honda up over 1% ahead of Q1FY10 numbers. BPCL was up 1.7% on good set of numbers.
Maruti Suzuki, Ambuja Cements, GAIL and HUL were the other gainers.
Midcap space:
Kingfisher Airlines was up 4% on fund raising plans. Great Offshore rose 3%.
Gujarat Gas was up 1% as the company announced bonus and EBITDA numbers were good as well.
Balrampur Chini and Bajaj Hindusthan were also up.
Gammon India was down 7.5%.
GVK Power and Punj Lloyd were other losers.
Alembic shot up 6% on good numbers. Firstsource was up 3% as its numbers were ahead of estimates.
Maytas Infra and Mcleod Russel were up 3% each.
Global cues:
Asian markets were trading lower. Shanghai and Hang Seng fell 1.7% each. Straits Times and Taiwan Weighted declined 0.5% each. Nikkei and Kospi were flat in trade.
The US markets recovered from the day's low amid mix economic data. Commodities declined as USD rebounded.
The Dow Jones Industrial Average ended down 12 points at 9,097, after seeing recovery of 90 points from day's low of 9,007.
The Nasdaq Composite was up 7.6 points at 1,976, after seeing recovery of 28 points from day's low of 1,948 and the S&P 500 Index was down 2.5 points at 980, after seeing recovery of 10 points from day's low of 970.
Commodities:
The CRB Index was down 1%.
Crude declined 1.7% at $67.23/bbl.
LME metals index was down 1.2%.
Copper was down 1%, Nickel down 2%, Tin down 3% and Zinc down 2%.
Gold was down 1.7% at $938/ounce, at 1-week lows.
Baltic Dry index was up 2%.
Market cues:
-FIIs net buy USD 92.5 million in equity on July 27
-MFs net sell Rs 176.8 crore in equity on July 27
-NSE F&O Open Int up by Rs 1960 crore at Rs 96,180 crore
-FII turnover as a % of Total F&O turnover at 27.7% versus 17.6%
-FIIs net buy Rs 59 crore in cash markets on July 28 (Prov)
-DIIs net buy Rs 448 crore in cash markets on July 28 (Prov)
-FIIs net sell Rs 670 crore in F&O on July 28
F&O cues:
-Stock Futures add 51 lakh shares in Open Int
-Futures Open Int up by Rs 1171 crore and Options Open Int up by Rs 789 crore
-Nifty July Futures shed 26.7 lakh shares in Open Int
-Nifty Aug Futures add 41.4 lakh shares in Open Int
-Nifty Aug Futures at 10-pt premium versus 11-pt premium
-Nifty IVs at 34-37%
-Nifty Open Int Put Call Ratio remains at 1.31
-Nifty Puts add 7.7 lakh shares in Open Int
-Nifty Calls add 6.2 lakh shares in Open Int
-Nifty August 4500 Put adds 3.75 lakh shares in Open Int
-Nifty August 4600 Put adds 3.4 lakh shares in Open Int
-Nifty July 4600 Call adds 3.4 lakh shares in Open Int
-Nifty August 4600 Call adds 2.6 lakh shares in Open Int
RIL-RNRL gas row: Is govt at disadvantage by fixing price?
Anil Ambani made some dramatic comments at the Reliance Natural Resources Ltd (RNRL) annual general meeting (AGM) of shareholders on Tuesday calling the Petroleum Ministry’s stance partisan towards Reliance Industries (RIL) and RIL dishonourable.
“RIL’s dishonourable conduct in persistently refusing to honour the gas supply contract," Ambani said. "Secondly, the exorbitant profits RIL is seeking to make at the cost of the power and fertiliser sector in the country. Thirdly, the apparently-biased and partisan role of the Petroleum Ministry. RIL has tried every trick in the book and apparently several outside the book to back out of its solemn, legal and contractual obligations.”
“RIL’s dishonourable conduct in persistently refusing to honour the gas supply contract," Ambani said. "Secondly, the exorbitant profits RIL is seeking to make at the cost of the power and fertiliser sector in the country. Thirdly, the apparently-biased and partisan role of the Petroleum Ministry. RIL has tried every trick in the book and apparently several outside the book to back out of its solemn, legal and contractual obligations.”
Looking at full-year topline of Rs 1000cr: McLeod Russell
McLeod Russel has announced its first quarter results. The company's Q1 net profit was at Rs 31.2 crore.
Managing Director Aditya Khaitan, in an exclusive interview , said the company’s profit rose to Rs 31 crore from Rs 7 crore year-on-year and that the company was looking at a full-year topline of Rs 1,000 crore. Commenting on tea prices, he said, “We have had a good start at the beginning of the year and the prices went up due to the drought. We believe that these prices are here to stay, during the season the prices will come down depending on the supply of tea, but overall I still feel that if you compare period to period we would still be higher than the previous year.”
Managing Director Aditya Khaitan, in an exclusive interview , said the company’s profit rose to Rs 31 crore from Rs 7 crore year-on-year and that the company was looking at a full-year topline of Rs 1,000 crore. Commenting on tea prices, he said, “We have had a good start at the beginning of the year and the prices went up due to the drought. We believe that these prices are here to stay, during the season the prices will come down depending on the supply of tea, but overall I still feel that if you compare period to period we would still be higher than the previous year.”
Gammon India faces 2-yr ban from DMRC; stock plunges
Gammon India touched an intraday high of Rs 145 and an intraday low of Rs 130.10. At 10:11 am, the share was quoting at Rs 140.85, down Rs 7.75, or 5.22%.
In the aftermath of Delhi Metro mishap that took place recently, Delhi metro chief E Sreedharan has said that Gammon India has taken off all contracts awarded to it. And the company may get blacklisted for 2 years,
It was trading with volumes of 498,689 shares. Yesterday the share closed up 4.46% or Rs 6.35 at Rs 148.60.
In the aftermath of Delhi Metro mishap that took place recently, Delhi metro chief E Sreedharan has said that Gammon India has taken off all contracts awarded to it. And the company may get blacklisted for 2 years,
It was trading with volumes of 498,689 shares. Yesterday the share closed up 4.46% or Rs 6.35 at Rs 148.60.
Hope to sell over 60000 vehicles in FY10: Ashok Leyland
Ashok Leyland announced its first quarter numbers for the financial year 2010. The company’s Q1 standalone net sales were down 51.6% at Rs 912 crore versus Rs 1,887 crore. Its standalone net profit was down 84.7% at Rs 7.7 crore versus Rs 50.6 crore, on year-on-year (YoY) basis.
Its operating profit margin declined to 1.5% from 6.4%. Loss before tax stood at Rs 31.33 crore versus an earnings before interest, taxes, depreciation, and amortization (EBITDA) of Rs 77 crore.
K Sridharan Chief Financial Officer, Ashok Leyland, said the market can expect new launches in the second half of 2009. “New launches and dealer tie-ups will drive growth going forward. Also, the bus segment will boost growth." He expects 10% volumes growth in FY10, while targeting over 60,000 vehicle sales.
Sridharan expects the company’s operating profit margin (OPM) to go back to 10-11% levels as he sees signs of sales pick up in the south on account of revival in the textile industry. "
The company, he said, is looking at generating Rs 400-500 crore from internal accruals. “We have not yet decided on whether to raise money via equity or debt.”
Its operating profit margin declined to 1.5% from 6.4%. Loss before tax stood at Rs 31.33 crore versus an earnings before interest, taxes, depreciation, and amortization (EBITDA) of Rs 77 crore.
K Sridharan Chief Financial Officer, Ashok Leyland, said the market can expect new launches in the second half of 2009. “New launches and dealer tie-ups will drive growth going forward. Also, the bus segment will boost growth." He expects 10% volumes growth in FY10, while targeting over 60,000 vehicle sales.
Sridharan expects the company’s operating profit margin (OPM) to go back to 10-11% levels as he sees signs of sales pick up in the south on account of revival in the textile industry. "
The company, he said, is looking at generating Rs 400-500 crore from internal accruals. “We have not yet decided on whether to raise money via equity or debt.”
Shangai tanks 5%: Will global mkts see new lows?
The much feared Chinese asset bubble burst has finally happened. China's Shanghai Composite plunged 5% led by fall in property and steel shares. Indian and other Asian markets...
China's Shanghai Composite on Wednesday plunged 5% led by fall in property and steel shares. The Indian and other Asian markets mirrored this fall.
Moreover, the Chinese government also cut gasoline prices from today by CNY 220/ ton. Shares of China Petroleum & Chemical and PetroChina fell in Hong Kong after this unexpected cut. Sinopec slipped 3% while PetroChina lost 2%.
So, is this just an aberration or a precursor to a major correction across global markets? Experts delve deeper.
Kirby Daley, Senior Strategist at Newedge Group said that the effects of the Chinese market fall would not be a short-term affair. He fears that the global market would see lower lows again. “Emerging markets had gotten ahead of themselves with more inflows from foreign money which could prove to be hot in another risk aversion run and also in general there has been a pricing in of a sustainable commodity rally based on recovery of consumption by the end consumer which I don’t believe is there. I think emerging markets will be hurt when that reality is factored back in.”
Dariusz Kowalczyk, Chief Investment Strategist, SJS Market, said that the plunge in the Shanghai market today was driven by the fact that valuations had gotten ahead of fundamentals. “Some large investors decided that it is time to take profits.” The fall would definitely impact other markets. “Most global indices around the world will finish above current levels by the end of this year. Some emerging markets may actually still decline towards December and I would count both China and India. India I think will finish at 15,000.”
Andy Xie, Independent Economist said that China needed to understand the risks associated with its current policy. It is releasing liquidity to stimulate the economy, but unlike, the US which had a financial crisis, there was no similar situation in China and so, the liquidity doesn’t come out of the financial system. “What is going on in China is over-stimulating the financial markets. The impact on the real economy is limited. So, China might be doing what the US did during the subprime crisis. So, I think China needs to be careful. It should not go overboard in trying to do what the US has done.”
China's Shanghai Composite on Wednesday plunged 5% led by fall in property and steel shares. The Indian and other Asian markets mirrored this fall.
Moreover, the Chinese government also cut gasoline prices from today by CNY 220/ ton. Shares of China Petroleum & Chemical and PetroChina fell in Hong Kong after this unexpected cut. Sinopec slipped 3% while PetroChina lost 2%.
So, is this just an aberration or a precursor to a major correction across global markets? Experts delve deeper.
Kirby Daley, Senior Strategist at Newedge Group said that the effects of the Chinese market fall would not be a short-term affair. He fears that the global market would see lower lows again. “Emerging markets had gotten ahead of themselves with more inflows from foreign money which could prove to be hot in another risk aversion run and also in general there has been a pricing in of a sustainable commodity rally based on recovery of consumption by the end consumer which I don’t believe is there. I think emerging markets will be hurt when that reality is factored back in.”
Dariusz Kowalczyk, Chief Investment Strategist, SJS Market, said that the plunge in the Shanghai market today was driven by the fact that valuations had gotten ahead of fundamentals. “Some large investors decided that it is time to take profits.” The fall would definitely impact other markets. “Most global indices around the world will finish above current levels by the end of this year. Some emerging markets may actually still decline towards December and I would count both China and India. India I think will finish at 15,000.”
Andy Xie, Independent Economist said that China needed to understand the risks associated with its current policy. It is releasing liquidity to stimulate the economy, but unlike, the US which had a financial crisis, there was no similar situation in China and so, the liquidity doesn’t come out of the financial system. “What is going on in China is over-stimulating the financial markets. The impact on the real economy is limited. So, China might be doing what the US did during the subprime crisis. So, I think China needs to be careful. It should not go overboard in trying to do what the US has done.”
Don't expect rate hikes before Feb-Mar 2010: Morgan Stanley
Chetan Ahya, Managing Director, Morgan Stanley, does not expect rate hikes before February-March 2010. “We do not see rate hikes in the near term. However, the RBI could hike interest rates by February-March 2010.”
However, he did not rule out the possibility of the RBI changing its cash reserve ratio (CRR) or the market stabilisation scheme (MSS) before changing policy rates. “A potential hike in CRR is possible by the last quarter this year.” He believes, lending rates can fall by 25-50 basis points.
He expects industrial production to reach 7-8% by March 2010. “Industrial growth can offset a slowdown in agriculture.”
Morgan Stanley, he said, maintains a GDP forecast of 6.2% for FY10. ”However, he sees an upside risk to the forecast.”
According to him, the traction from monetary and fiscal policy was better than expected.
However, he did not rule out the possibility of the RBI changing its cash reserve ratio (CRR) or the market stabilisation scheme (MSS) before changing policy rates. “A potential hike in CRR is possible by the last quarter this year.” He believes, lending rates can fall by 25-50 basis points.
He expects industrial production to reach 7-8% by March 2010. “Industrial growth can offset a slowdown in agriculture.”
Morgan Stanley, he said, maintains a GDP forecast of 6.2% for FY10. ”However, he sees an upside risk to the forecast.”
According to him, the traction from monetary and fiscal policy was better than expected.
RNRL serves notice to Oil Min, RIL in gas dispute
A day after Anil Ambani called Reliance Industries (RIL)
dishonourable, and the Petroleum Ministry partisan at Reliance Natural Resource’s AGM, he said his company had served notice to the Oil Ministry and RIL with regard to the gas dispute. He requested the Supreme Court to set September 1 as final hearing in the tussle.
Ambani said the RIL-RNRL gas dispute affects public interest as it has bearing on projects of 12,000 MW capacity. He went on to say that they seek an early resolution of the ongoing gas dispute.
He hopes the Oil Ministry will agree to expedite settling of the gas row and believes the ministry is being misguided by RIL.
dishonourable, and the Petroleum Ministry partisan at Reliance Natural Resource’s AGM, he said his company had served notice to the Oil Ministry and RIL with regard to the gas dispute. He requested the Supreme Court to set September 1 as final hearing in the tussle.
Ambani said the RIL-RNRL gas dispute affects public interest as it has bearing on projects of 12,000 MW capacity. He went on to say that they seek an early resolution of the ongoing gas dispute.
He hopes the Oil Ministry will agree to expedite settling of the gas row and believes the ministry is being misguided by RIL.
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