WEEKLY MARKET OUTLOOK :- 31-07-2009

Still, the short term sentiment is bullish…
With the help of Firm trend in global markets, short covering in F&O segment and
better than expected quarterly earnings, NIFTY extended gains of 1.76 percent in
the preceding week. Q1 earning announcement for most of the heavy weight index
stocks are almost over. The volumes appear to have taken the south path all
through the week largely aided selling by the foreign institutions in the futures and
options segment. On the Futures & Options front, the NIFTY August futures open
interest improved against previous week coupled with positive cost of carry
suggesting bullish signal. NIFTY August futures trading at a narrowing premium of
around 2-5 points against spot market over a couple of days.
The Put-Call ratio of
open interest slithered from 1.46 to 1.10 against preceding week as Call options
ruled the accumulation over the Put options. The implied volatility (IV) trend of Put
options indicates short build up in the beginning of the week and reversal towards
the end. The IV of Call options rose initially; however, the Nifty is restricted to move
around the 4700 mark reflected by the shorting of higher Call options. Considering
the above said factors, nothing is changed since last week, still the short-term
sentiment is bullish and if NIFTY sustains above 4693 levels we may see the rally
upto 4910 levels. The weekly key support is likely to be seen at 4530 and 4474
levels.

Post Market Analysis
Domestic market concluded the week in the positive terrain on account of sustained
buying. Favorable global cues, mainly from Asian markets contributed to the sharp
rally. The rollover of Nifty positions for July 2009 series stood at 69% versus 63%
last month while market wide rollover of positions was at 75% versus 77% last
series. 22

Lower newsprint costs boosted PAT: Deccan Chronicle

Deccan Chronicle Holdings declared its first quarter numbers for the financial year 2010. Its net sales came in at Rs 216.6 crore and its net profit stood at Rs 77 crore.
Speaking on the company’s results, PK Iyer, Managing Director of Deccan Chronicle said though the volumes were down on year-on-year basis, they were cautiously optimistic about the future. “Lower newsprint costs boosted net profit,” he added.

FY10 turnover seen at Rs 1000cr, PAT at Rs 50cr: Rico Auto

Rico Auto has announced its first quarter results. The company Q1 revenues were down 6.7% at Rs 180 crore versus Rs 193 crore. Its PAT was up at Rs 2.6 crore versus Rs 61 lakh. Its OPM was up at 11% versus 10.6%;

Arvind Kapur, Managing Director of Rico Auto Industries, said that he saw the FY10 turnover at Rs 1,000 crore. He added that they aimed to achieve a FY10 profit after tax (PAT) of Rs 40–50 crore and added that they were targeting an EBITDA margin of 15%. Kapur expects Rico Auto's revenues from Maruti to grow by 15–20%.

Nifty to touch 4850 if it crosses 4700: Ashwani Gujral

Ashwani Gujral, Technical Analyst, ashwanigujral.com, said if 4,620 levels could be maintained for half an hour, it could be a trending day which could finally take out 4,600-4,700 kind of zone and the Nifty can move towards 4,850. “If the gap holds for the first half hour, one can go ahead and buy,” advices Gujral.

Nifty can touch 5K in Aug series: Mangal Keshav

Nifty can touch 5K in Aug series: Mangal Keshav

Chinese mkt to see correction ahead: UBS

Polaris Q1 net down; biz volumes shifting offshore

ONGC advances 5%

Oil and Natural Gas Corporation, ONGC touched an intraday high of Rs 1,161.90 and an intraday low of Rs 1,095. At 11:30 am, the share was quoting at Rs 1,156.10, up Rs 56.55, or 5.14%.

It was trading with volumes of 262,237 shares. Yesterday the share closed up 0.12% or Rs 1.35 at Rs 1,099.55.

Block deals in Indiabulls Financial, stock up

Indiabulls Financial Services touched an intraday high of Rs 206.45 and an intraday low of Rs 197.80. At 12:09 pm, the share was quoting at Rs 200.15, up Rs 5.65, or 2.90%.

There were block deals of 20 lakh Indiabulls Financial shares on BSE and NSE at Rs 200.10 per share.

It was trading with volumes of 1,283,127 shares. Yesterday the share closed down 2.33% or Rs 4.65 at Rs 194.5.

Eventual plan to take mgmt control of Great Offshore: ABG

ABG Shipyard picked-up further stake in Great Offshore yesterday which took their stake up considerably, and subsequently, has upped their open offer price too.
Commenting on the issue, D Datar, CFO of ABG Shipyard, said that their stake in Great Offshore has gone up to 8%. He said the open offer price for Great Offshore has been revised to Rs 450 per share. However, he refused to comment if Punj Lloyd was a seller in the block deal.
Datar stated that the company’s eventual plan is to take management control of Great Offshore. He added that ABG Shipyard is ready to buy from parties willing to sell Great Offshore shares at Rs 450 per share.

NHPC IPO: $1.2bn proceeds to fund 11 projects

It will be the first public sector enterprise to tap the capital markets this year. National Hydroelectric Power Corporation (NHPC) has kicked off its road shows, as it looks to raise up to Rs 6,000 crore. Katya Naidu and Vidhi Godiawala report.
For the first time in its 34-year history, NHPC has 11 projects under construction. At the same time, it is looking at a USD 1.2 billion IPO to fund it. The company wants to double its capacity over four years.
SK Garg, CMD, NHPC, said, "By 2012, we will be commissioning almost 2,300 MW. Two projects will come in the first year of the 12th Plan, which will add another 2,000 MW. By 2013, our company will be something like 9,500 MW company."
The IPO is expected to raise Rs 6,000 crore at the higher end of the price band. Of this Rs 6,000 crore, around Rs 4,000 crore will accrue to the company, Rs 2,000 crore will go to the government for its 5% stake it is divesting.
At Rs 30-36 per share, the IPO is aggressively priced. Bankers hope the uptick in market sentiment and the government's credibility will make it a good bargain.
Vallabh Bhansali, Chairman, Enam Securities, said, "It is a unique company. It is in hydro power, it is a large company, financially very good, and not leveraged like other power companies. A lot of factors have gone into valuing this company."
Falguni Nayar, MD - Institutional Equities, Kotak Mahindra Bank, said, "We are hoping for a positive response because market is improving and investor appetite is improving."
S Vishwanathan, MD, SBICAPS, said, "This issue will be a forerunner for many more issues to come."
NHPC hopes its IPO will see the same strong subscription rush seen by Adani Power's IPO earlier this week, when it was subscribed 4 times on the very first day. Experts point out that NHPC's expansion is not the only thing that hangs in the balance. This IPO could well set the pace for future divestments as well.

Bullish on PSU banks, wary of realty: India Infoline

Sandeepa Arora of India Infoline said she was bullish on PSU banks that were still trading at 1-1.5 times price-to-book, but added that she was wary of the realty space

Market Round Up from Moneycontrol: More stock news. More stock advice. Top News Investors should shift to mid-tier FMCG cos: IDFC SSKI

Nikhil Vora, Managing Director, of IDFC SSKI, has advised investors to shift to mid-tier consumer companies. He expects midcap FMCGs to report higher sales growth than ITC and HUL.
With regard to United Spirits’ results, Vora said the company’s numbers were impressive and that it had addressed major concerns. He added the company’s balance sheet was strengthening and USL was no longer an expensive stock.