BSE Weekly review 22nd Oct 2010

The splendid response to the Coal India IPO boosted the morale of the bulls; as did a few strong corporate earnings. However, momentum failed to last as key indices saw accelerated selling on Friday. Sentiment was also nervous after two consecutive weeks of losses, which dragged down the indices from 33-month highs. Finally the Sensex and Nifty closed the week flat at 20166 and 6066 respectively.

Sensex intra-week high of 20352 and low of 19870

Nifty intra-week high of 6127 and low of 5966

Sensex top gainers: The top gainers in the Sensex were TCS (up 9.5%), Reliance Ind (up 4%), Ranbaxy Labs (up 3.9%), Cipla (up 3.8%) and Hero Honda (up 3.6%).

Sensex top Losers: The top losers in the Sensex were Wipro (down 5.2%), HDFC (down 4.8%), Tata Steel (down 2.9%), DLF (down 2.8%) and HDFC Bank (down 2.5%).

The BSE IT Index (up 1%): The top gainers in the IT sector were TCS (up 9.5%), Sasken Comm (up 2.2%), Mphasis (up 0.4%), Patni Computer (up 0.4%) and Infosys (up 0.2%).

The top losers were Wipro (down 5.2%), HCL Tech (down 3.4%), Mahindra Satyam (down 3%), OFSS (down 1.6%) and Financial Tech (down 1.2%).

The BSE Consumer Index: The top gainers in the Consumer Durables sector were Samtel Color (up 26.4%), Whirlpool (up 3.1%), Mirc Electronics (up 2.5%).

The top losers were Su-Raj Diamonds (down 2.8%), Blue Star (down 0.9%), Videocon Industries (down 0.6%).

The BSE Healthcare Index (up 2.8%): The top gainers in the Pharma space were Glenmark Pharma (up 5.1%), Aurobindo Pharma (up 5%), Sun Pharma (up 4.9%), Orchid Chem (up 4.6%) and Panacea Biotec (up 4.4%).

The top losers were Wockhardt (down 2.5%), Morepen Labs (down 1.5%), Emami Limited (down 1.4%) and Divi Labs (down 0.2%).

The BSE Banking Index (up 0.5%):The top gainers in the banking space were Canara Bank (up 13.4%), Federal Bank (up 10.6%), Yes Bank (up 6.4%), Andhra Bank (up 6.2%) and Allahabad Bank (up 5.9%).

The top losers were Kotak Mahindra Bank (down 2.8%), Axis Bank (down 2.5%), HDFC Bank (down 2.5%) and Karnataka Bank (down 0.2%).

The BSE Auto Index (down 0.2%): The top gainers were Hindustan Motors (up 4.7%), Hero Honda (up 3.6%), Ashok Leyland (up 1.7%) and Swaraj Mazda (up 0.4%).

The top losers were Eicher Motors (down 3.3%), M&M (down 1.3%), Bajaj Auto (down 1.2%), Maruti Suzuki (down 1%) and Tata Motors (down 0.6%).

The BSE Oil & Gas Index (up 2.7%):The top gainers in the oil & gas space were Essar Oil (up 7.4%), GSPL (up 7.2%), IOC (up 6.5%), Reliance Ind (up 4%) and BPCL (up 3.5%).

The top losers were Gujarat NRE Coke (down 3.6%), Jindal Drilling (down 3.6%), Shiv-Vani Oil (down 3.1%), Cairn India (down 0.9%) and Chennai Petroleum (down 0.5%).

The BSE Capital Goods Index (up 1.1%):The top gainers in the Capital Goods space were Elgi Equipments (up 3.3%), Carborundum Univ (up 3.2%), Crompton Greaves (up 2.6%), Siemens India (up 2.3%) and Greaves Cotton (up 2.2%).

The top losers were Kirloskar Bro (down 5.1%), Alstom Projects (down 4.3%), Esab India (down 3.3%), Jyoti Structures (down 3.1%) and Gammon India (down 2.6%).

The Cement Sector: The top losers in the cement sector were Binani Indus (down 18%), Dalmia Cement (down 3.5%), Birla Corp (down 3.3%), Ultratech Cement (down 2.2%) and Grasim Inds (down 1.9%).

JK Cements gained 2.9% during the week.

The Telecom Sector: The top gainers in the telecom space were Gemini Comm (up 19.1%), Reliance Com (up 1.8%), Idea Cellular (up 1.4%) and MTNL (up 0.2%).

The top losers were Tata Communication (down 3.6%), Shyam Telecom (down 2.6%), TTML (down 2.6%), Himachal Futuristic (down 2.3%) and WWIL (down 1.8%).

The Realty Sector (down 2.2%):The top losers in the were Ansal Props (down 8.2%), Unitech (down 6%), Akruti City (down 4.8%), Parsvnath (down 4.1%) and Anant Raj Indus (down 3.2%).

The Metals sector (down 2.7%):The top losers in the metals sector were JSW Steel (down 4.6%), Jindal Stainless (down 3.9%), Adhunik Metaliks (down 3.9%), Ispat Industries (down 3.2%) and Tata Metaliks (down 2.9%).

The top gainers were Bhushan Steel (up 5.2%), Monnet Ispat (up 4.7%) and Bhuwalka Steel (up 1.9%).

Souroce IIFL

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Weekly Analysis 20 Sept 2010

The bulls continued their rampage on Indian bourses on back of July IIP data, which beat all expectations. The flush of funds so far has led to Indian indices performing relatively better to their global peers. However, lack of participation by the broader market in the recent rally raises some doubts about the strength and sustainability of the advance. Finally, Nifty advanced by 4.3% during the week and Sensex added 4.2%.

Sensex intra-week high of 19,639 and low of 18,845

Nifty intra-week high of 5,901 and low of 5,639

Also Read:

Sensex on a roll…Nifty up nearly 1%

Asian markets...Japan rises, China falls

Sensex top gainers: The top gainers in the Sensex were DLF (up 9.5%), HDFC (up 8.5%), Reliance Inds (up 7.2%), HDFC Bank (up 6.9%) and ICICI Bank (up 6.1%).

Sensex top Losers: BHEL was the only loser among the 30-components of the Sensex; the scrip lost 1.4% during the week.

The BSE IT Index (up 3.2%): The top gainers in the IT sector were OFSS (up 6.4%), TCS (up 4.5%), Financial Tech (up 4%), Wipro (up 3%) and Infosys (up 2.6%).

The top losers were Sasken Communication (down 2.8%), Mphasis (down 0.9%) and Patni Computer (down 0.3%).

The BSE Consumer Index: The top losers in the Consumer Durables were Mirc Electronics (down 6.2%), Whirlpool (down 2.8%), Su-Raj Diamonds (down 1.9%) and Videocon Industries (down 1.4%).

The top gainers were Titan (up 8.5%) and Blue Star (up 0.6%).

The BSE Healthcare Index (up 3%): The top gainers in the Pharma space were Torrent Pharma (up 8.8%), Orchid Chem (up 8.8%), Sun Pharma (up 7.4%), Panacea Biotec (up 5.7%) and Ranbaxy Labs (up 5.5%).

The top losers were Divi Labs (down 4.8%), Zandu Pharma (down 3.9%), Suven Life Science (down 3.4%), Piramal Healthcare (down 3.3%) and IPCA Labs (down 1.9%).

The BSE Banking Index (up 6%):The top gainers in the banking space were Kotak Mahindra Bank (up 9.5%), Axis Bank (up 9.2%), HDFC Bank (up 6.9%), ICICI Bank (up 6.1%) and Union Bank of India (up 5.9%).

Karnataka Bank slipped 2.1% during the week.

The BSE Auto Index (up 2%):The top gainers in the auto space were Maruti Suzuki (up 5.6%), Ashok Leyland (up 5.1%), M&M (up 3.7%), Tata Motors (up 2%) and Hero Honda (up 0.7%).

The top losers were Swaraj Mazda (down 5%), Eicher Motors (down 3.1%), Hindustan Motors (down 2.7%) and Bajaj Auto (down 0.9%).

The BSE Oil & Gas Index (up 5.5%): The top gainers in the oil & gas space were Reliance Inds (up 7.2%), Cairn India (up 4.8%), IOC (up 4.5%), Essar Oil (up 4.1%) and Chennai Petroleum (up 3.3%).

The top losers in the oil & gas space were GSPL (down 5.6%), Jindal Drilling (down 5.3%) and Great Offshore (down 2.6%).

The BSE Capital Goods Index (up 3%): The top gainers in the Capital Goods space were Elgi Equipments (up 7.9%), ABB (up 7.7%), Ingersoll Rand (up 7.7%), BEL (up 7.6%) and Alstom Projects (up 6.8%).

The top losers in the Capital Goods were BEML (down 3.4%), Heg (down 3%), LMW (down 1.8%), Dredging Corp (down 1.8%) and Jyoti Structures (down 1.7%).

The Cement Sector: The top gainers in the cement sector were Birla Corp (up 5.5%), Grasim (up 3.7%), Dalmia Cement (up 3.5%), JK Cements (up 3%) and Prism Cement (up 2.5%).

The top losers were Kakatiya Cement (down 4.1%), Binani Indus (down 2.6%), Mangalam Cement (down 0.7%) and Gujarat Sidhee (down 0.3%).

The Telecom Sector: The top gainers were Gemini Comm (up 6%), Bharti Airtel (up 2.5%), RCom (up 1.9%), Idea Cellular (up 0.5%) and WWIL (up 0.3%).

The top losers in the telecom space were Shyam Telecom (down 4.5%), Himachal Futuristic (down 1.8%), Tata Communication (down 1.2%), MTNL (down 1%) and TTML (down 0.2%).

The Realty Sector (up 4.5%):The top gainers in the real estate space were DLF (up 9.5%), Unitech (up 7.2%), Peninsula Land (up 1.8%), Omaxe (up 1.6%) and Sobha Developers (up 1.3%).

The top losers were Anant Raj Indus (down 3.6%), Akruti City (down 1.7%), Mahindra Lifespace (down 1.5%), HDIL (down 0.5%) and Ansal Props (down 0.3%).

The Metals sector (up 2.2%): The top gainers in the metals sector were Bhushan Steel (up 13%), Ispat Industries (up 10.5%), JSW Steel (up 3.3%), Tata Steel (up 1.9%) and SAIL (up 0.9%).

The top losers were Lloyds Metals (down 5.5%), Monnet Ispat (down 4.2%), Tata Metaliks (down 2.8%), Jindal Stainless (down 2.5%) and Adhunik Metaliks (down 1.4%).

Source : DC.com

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BSE / NSE weekly analysis 30 April 2010

The market edged lower in volatile trade as unease over euro zone sovereign debt levels weighed on world equities. However, expectations of a normal monsoon this year and optimism about fourth quarter corporate earnings capped the decline on the domestic bourses. The European debt crisis spread after S&P slashed its credit ratings on Greece and Portugal. The rating firm also lowered its credit rating on Spain amid concerns about the country's growth prospects following the collapse of a construction bubble. The downgrades escalated fears of a contagion that could raise borrowing costs for European countries and derail an economic recovery.

The BSE Sensex fell 135.49 points or 0.77% to 17558.71 in the week ended 30 April 2010. The S&P CNX Nifty declined 26.10 points or 0.49% to 5,278 in the week. The market gained in three out of five trading sessions in the week.

The BSE Mid-Cap index rose 0.74% and the BSE Small-Cap index gained 0.08%. Both the indices outperformed the Sensex.

The key benchmark indices edged higher for the fifth straight day on Monday, 26 April 2010 on firm global stocks and forecast of a normal monsoon this year. The BSE 30-share Sensex rose 51.08 points or 0.29% to 17,745.28.

The market edged lower on Tuesday, 27 April 2010, snapping gains in the preceding five trading sessions, on weak global stocks. The BSE 30-share Sensex lost 54.66 points or 0.31% to settle at 17,690.62.

The key benchmark indices extended losses for the second straight day on Wednesday, 28 April 2010 as world stocks reeled from rating downgrades on Greece and Portugal. The BSE 30-share Sensex fell 310.54 points or 1.76% to 17380.08.

The market rebounded after a two-day slide on Thursday, 29 April 2010, tracking gains in European stocks and higher US index. The BSE 30-share Sensex rose 123.39 points or 0.71% to 17,503.47.

Profit booking in the second half of the day's trading session capped gains in the key benchmark indices on Friday, 30 April 2010. The BSE 30-share Sensex rose 55.24 points or 0.32% to 17,558.71.

The Lok Sabha on Thursday, 29 April 2010, passed the Finance Minister Pranab Mukherjee's Budget for 2010-11 by a voice vote with some minor concessions. The concessions will reduce the incidence of service tax on housing and air travel, incentivise construction of big hospitals, keep cancer and anti-AIDs drugs cheap and provide relief to debt-ridden coffee growers. However, the government held firm not to roll back hike in prices of petrol and diesel. With the passage of the Bill by the Lok Sabha, the three-stage budgetary process stands completed.

On the macro front, the latest data showed infrastructure sector output jumped 7.2% in March 2010 from a year earlier, higher than an upwardly revised rise of 4.7% in February 2010.

The food price index rose 16.61% in the year to 17 April 2010, data released by the government on Thursday, 29 April 2010, showed. The rise in food prices inflation was slower than an annual rise of 17.65% in the previous week. But, fuel price inflation quickened. The fuel price index rose 12.69% in the year to 17 April 2010 a year ago, faster than the previous week's 12.45% rise. The primary articles index was up 13.55% in the year to 17 April 2010.

The Indian Meteorological department (IMD) expects normal rainfall in the June-September monsoon season this year. Rainfall is likely to be 98% of the long-term average, the IMD said on 23 April 2010. Good monsoon rains would help raise farm output, boost rural incomes and lower food inflation. The south west monsoon is important for India as about 60% of the country's farmlands are rain-fed and more than half of the workforce is employed in the agriculture sector. The quantum of rainfall in the crucial sowing month of July and distribution of rainfall during the monsoon season holds key.

The Reserve Bank of India expects India's economy to expand 8% in the year ending March 2011 (FY 2011) with an upward bias, assuming a normal monsoon this year and sustenance of good performance of the industrial and services sectors on the back of rising domestic and external demand.

The RBI at its annual policy review, on 20 April 2010, said it will continue to monitor macroeconomic conditions, particularly the price situation closely and take further action as warranted. A 25 basis points hike in the cash reserve ratio (CRR) with effective from 24 April 2010 will suck out excess liquidity of Rs 12500 crore from the banking system.

In its half-yearly World Economic Outlook, the International Monetary Fund (IMF) has pegged India's GDP growth at 8.75% in calendar 2010 and 8.5% in calendar 2011. According to the IMF, domestic demand in India will strengthen as the labour market improves, and investment is expected to be boosted by strong corporate profitability, rising business confidence and favourable financing conditions.

The Q4 March 2010 corporate earnings announced so far have been good. The combined net profit of a total of 660 companies rose 25.8% to Rs 33470 crore on 32.5% rise in sales to Rs 302678 crore in the quarter ended March 2010 over the quarter ended March 2009.

The government on Thursday, 29 April 2010, kicked off its disinvestment programme for the fiscal year March 2011 with the initial public offering (IPO) of the state-run SJVN. The government plans to raise Rs 1000 crore through the IPO, and is offloading 10% of its stake in the company. The IPO was subscribed 43% on day one.

The Congress-led United Progressive Alliance government sailed through a trial of strength in parliament on Tuesday, 27 April 2010, by defeating the cut motion demanded by opposition parties against an unpopular hike in fuel and fertiliser prices with smaller parties giving it a leg up to achieve a surprisingly strong victory for the government. However, major reforms may take a backseat for the some time to come as there is a stiff resistance by the opposition on fears it may hurt the poor.

Index heavyweight Reliance Industries (RIL) fell 5.04%. RIL reportedly plans to sell gas to retail consumers in the US and will use its newly built partnership with Atlas Energy to build a brand name in the US market.

RIL said on Wednesday 28 April 2010 it had discovered oil in one of its exploration blocks in the Cambay basin on India's western coast, the block in which it holds 100% controlling interest. This is its fourth oil discovery in the region.

Interest rate sensitive banking shares were mixed. India's second largest private sector bank by net profit HDFC Bank gained 2.43%. But, India's largest private sector bank by net profit ICICI Bank fell 2.59%.

India's biggest commercial bank in terms of branch network State Bank of India rose 1.18% on recent brokerage upgrades on the counter. A prominent foreign brokerage reportedly raised its rating on the stock to 'neutral' from 'sell'. Another foreign brokerage has reportedly predicted a re-rating of the counter on the back of an expected lending growth.

Most auto stocks advanced ahead of the release of April 2010 monthly sales data next week. India's largest commercial vehicle maker by sales Tata Motors surged 3.3% to Rs 872.85. The stock hit a 52 week high of Rs 877.90 on Friday, 30 April 2010. India's largest tractor maker by sales Mahindra & Mahindra (M&M) rose 1.07%. India's largest motorbike maker by sales Hero Honda Motors rose 1.13%. But, India's largest car maker by sales Maruti Suzuki India slumped 6.03%.

Sun Pharmaceutical Industries declined 6.99%. A US District Court for New Jersey on Friday, 23 April 2010, rejected claims by Teva Pharmaceutical Industries and Sun Pharmaceuticals Industries that the patent on Pfizer's Protonix acid reflux drug should be declared invalid. The original patent on Protonix, known chemically as pantoprazole, is held by Swiss drugmaker Nycomed and was licensed to Wyeth, which is now owned by Pfizer. Nycomed and Wyeth filed their patent infringement lawsuit against Teva Pharmaceutical Industries and Sun Pharma in May 2004.

Larsen & Toubro (down 0.59%), Tata Consultancy Services (down 1.77%), Wipro (down 2.81%), Tata Steel (down 4.57%) were the other losers from the Sensex pack.

Source : Capital Market

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BSE / NSE Weekly review 30 April 2010

The Indian markets ended with marginal losses in a highly eventful and results heavy week. Second rung stocks continued to outperform their larger index peers with the BSE Mid-Cap index adding nearly 1% during the week. However, the BSE Small-cap index ended almost flat. The market did witness some volatility owing to the global factors and F&O expiry. Overall, the mood remained slightly cautious due to mixed earnings from India Inc.

Finally, the BSE Sensex slipped 0.8% and the NSE Nifty lost 0.5% to shut shop at 17,558 and 5,278 respectively. The BSE Realty index was the top loser the index lost 3.1% followed by the Oil & Gas index which lost 1.6%. Big gainers were the BSE Banking index rose 0.7% followed by the BSE Auto and the BSE Power index.

The FII continued to be net buyers in the Indian markets; they bought stocks to the tune of Rs33.22bn last five and the DIIs were net sellers to the tune of Rs2.15bn.

The BSE Sensex hit an intra-week high of 17,826 and low of 17,344 while, the NSE
Nifty hit an intra-week high of 5,342 and low of 5,202.

The top gainers: The top gainers in the Sensex were ONGC (up 3.6%), Cipla (up 3.5%), Tata Motors (up 3.3%), HDFC (up 3.2%) and HDFC Bank (up 2.5%).

The Top Losers: The top losers in the Sensex were DLF (down 6.5%), Maruti Suzuki (down 6%), Reliance Industries (down 5%), Tata Steel (down 4.6%) and Grasim Industries (down 3.9%).

The BSE IT Index (down 0.4%): The top losers in the IT sector were Patni Computer (down 4.8%), Wipro (down 2.9%), Oracle Financial (down 2%), TCS (down 1.9%) and Financial Tech (down 1%).

The top gainers were Sasken Communication (up 8%), Mphasis (up 3.2%), Mahindra Satyam (up 2.1%), HCL Tech (up 1.7%) and Infosys Tech (up 0.4%).

The BSE Consumer Index: The top losers in the Consumer Durables were Mirc Electronics (down 6.6%), Samtel Color (down 2.8%) and Videocon Industries (down 1.6%).

The top gainers were Whirlpool (up 7.2%), Titan (up 3.1%) and Blue Star (up 0.1%).

The BSE Healthcare Index (up 0.2%): The top gainers in the Pharma space were Fresenius Kabi (up 7.2%), Torrent Pharma (up 5.7%), Piramal Healthcare (up 4.4%), Dr Reddy's Labs (up 3.9%) and Cipla (up 3.5%).

The top losers were Sun Pharma (down 6.7%), Natco Pharma (down 4.9%), Emami (down 4.8%), Morepen Labs (down 4.1%) and Strides Arcolab (down 4%).

The BSE Banking Index (up 0.7%): The top gainers in the banking space were Andhra Bank (up 9.8%), Bank of Baroda (up 6.6%), Yes Bank (up 5.4%), Canara Bank (up 5.2%) and Oriental Bank of Commerce (up 4.3%).

The top losers were Indian overseas Bank (down 3.6%), ICICI Bank (down 2.6%), Kotak Mahindra Bank (down 1%), Allahabad Bank (down 0.7%) and Karnataka Bank (down 0.6%).

The BSE Auto Index (up 0.5%):The top gainers in the auto space were Eicher Motors (up 16.2%), Ashok Leyland (up 5.8%), Tata Motors (up 3.3%), Hindustan Motors (up 2.8%) and Swaraj Mazda (up 1.9%).

The top losers were Maruti Suzuki (down 6%) and Bajaj Auto (down 0.7%).

The BSE Oil & Gas Index (down 1.6%): The top losers in the oil & gas space were Reliance Industries (down 5%), Shiv-Vani Oil (down 4.9%), Chennai Petroleum (down 1.9%), Hindustan Oil (down 1.7%) and Essar Oil (down 1.6%).

The top gainers were Great Offshore (up 10.9%), Gujarat NRE Coke (up 8%), Cairn India (up 6%), Jindal Drilling (up 5.1%) and IOC (up 4.9%).

The BSE Capital Goods Index (down 0.6%): The top losers in the Capital Goods were Alfa Laval (down 3.9%), ABB (down 3.8%), Bharat Electronics (down 3.8%), Areva T&D (down 3.6%) and Ingersoll Rand (down 3.2%).

The top gainers were Praj Industries (up 9.9%), Greaves Cotton (up 8.4%), SKF India (up 5.7%), Carborundum Universal (up 3.3%) and HEG (up 2.2%).

The Cement Sector: The top losers in the cement sector were Ultratech Cement (down 11.1%), Mangalam Cement (down 10.9%), India Cements (down 7%), Madras Cements (down 5.2%) and Shree Cement (down 4.8%).

The top gainers were Binani Indus (up 11.8%), Dalmia Cement (up 5.6%), Kakatiya Cement (up 0.6%) and ACC (up 0.1%).

The Telecom Sector: The top losers in the telecom were Idea Cellular (down 6.7%), Shyam Telecom (down 5.3%), Tata Communication (down 2.6%), Himachal Futuristic (down 2.4%) and Tata Teleservice (down 2.3%).

The Realty Sector (down 3.1%):The top losers in the Realty space were DLF (down 6.5%), Mahindra Lifespace (down 6.3%), Anant Raj Indus (down 4.4%), HDIL (down 3.4%) and Parsvnath (down 3%).

The top gainers were Akruti City (up 1.8%), Omaxe (up 1.4%) and Peninsula Land (up 0.4%).

The Metals sector (up 0.1%):The top losers in the metals sector were Lloyds Metals (down 4.7%), Tata Steel (down 4.6%), Tata Metaliks (down 3.4%), SAIL (down 3.2%) and Tata Sponge Iron (down 3%).

The top gainers were Jindal Stainless (up 4.4%), Jindal Steel & Power (up 3.4%), Bhuwalka Steel (up 2.8%) and JSW Steel (up 2.4%).

Source IIFL

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Indian Stock Markets Weekly Review 06-Nov-09

While the Monday blues were saved due to a local holiday, the indices came crashing down on Tuesday following extremely weak global cues. Bulls, however, managed to labor enough to stage a comeback on Thursday. The Finance Minister's remarks on disinvestment of PSUs, clarity on implementation of the direct tax codes and a rebound in global markets resulted in the Nifty closing at 4,796 up 1.8% and Sensex ending the week 1.6% higher at 16,158.

The BSE Sensex hit an intra-week high of 16,283 and low of 15,330 while, NSE Nifty hit an intra-week high of 4,836 and low of 4,563.

The Foreign Institutional Investors (FIIs) sold worth Rs11.46bn during the week. On the other hand, the Domestic Institutions were net buyers to the tune of Rs9.28bn during the week.

The top gainers: The top gainers in Sensex were ICICI Bank (up 10%), Reliance Capital (up 7.8%), Tata Steel (up 6.9%), Maruti Suzuki (up 6.7%) and Ranbaxy Labs (up 5.9%).

The Top Losers: The top losers in Sensex were Tata Power (down 9.4%), Ambuja Cements (down 5%), Wipro (down 5.2%), ITC (down 4%) and Hindustan Unilever (down 3.7%).

The BSE IT Index (up 0.5%): The top gainers in the IT sector were Financial Tech (up 16%), Mphasis (up 8.3%), Oracle Financial (up 5.3%) and Mahindra Satyam (up 3.2%).

The top losers were Sasken Communication (down 5.2%), Wipro (down 4.2%), TCS (down 1.9%) and HCL Tech (down 1.7%).

Patni Computer surged over 10.8% during the week after reports stated that L&T Infotech is planning to acquire the company.

Wipro was down by 5% during the week. The company acquired the business of Yardley in Asia, West Asia, Australia and certain African markets from UK-based Lornamead Group for Rs2.1bn.

According to a report released during the week, “Robust earnings upgrades (5-13% for FY10/11 for top 4 vendors) and stronger signs of a recovery (Wipro guided for 4.5% QoQ revenue growth for 3QFY10 at top end) sum up the review for the quarter. EBITDA margins continued to improve (50-150bps QoQ) on tight hiring and volume growth. That said, we believe most players’ margins have peaked in 2QFY10. Going forward, wage hikes and rupee appreciation remain the key risks, in our view. The demand environment has not recovered fully (Lloyds and RBS are set for a further US$51bn bailout and CIT has filed for bankruptcy), but we believe business conditions are conducive to strong growth in FY11, as: 1) IT spending has been low for over a year now; 2) deal pipelines are increasing; and 3) project rampdowns from badly affected industries like technology and telecom have also largely stabilised. Wipro and TCS remain our top picks among large caps. Among mid-cap firms, we prefer Patni, Infotech and Hexaware”.

The BSE Consumer Index: The top gainers in the consumer durables space were Mirc Electronics (up 3.2%), Su-Raj Diamonds (up 2.4%) and Blue Star (up 1.4%).

The top losers were Videocon Industries (down 7.6%) and Samtel Color (down 2.6%).

The BSE Healthcare Index (up 3.3%): The top gainers in the Pharma sector were Torrent Pharma (up 21.4%), Zandu Pharma (up 10.5%), Wockhardt (up 10.2%) and Lupin (up 7.3%).

The top losers were Dishman Pharma (down 10.3%), Natco Pharma (down 6.5%), Glaxosmithkline (down 2.5%), Orchid Chem (down 1.7%) and Morepen Labs (down 0.7%).

The BSE Banking Index (up 4%): The top gainers in the banking space were Yes Bank (up 8.8%), OBC (up 7%), Allahabad Bank (up 6.7%) and Kotak Mahindra Bank (up 6.6%).

The top losers were Federal Bank (down 6.8%) and Union Bank of India (down 1.7%).

ICICI Bank was the top gainer during the week. The stock surged 10%. IIFL in a report released during the week stated, “ICICI Bank’s 2QFY10 results show some positive sequential developments as CASA improved, operating expenses fell and NPLs too declined. However, these improvements are unlikely to result in a sustained re-rating of the stock. While CASA improved sequentially, NIM expansion of 10bps QoQ was below that witnessed at other banks. With loans down 14%YoY, we expect interest income to remain weak in the 2H. Provision charges will remain high in the foreseeable future so as to raise NPL coverage to the minimum required 70%. While ICICI is on the right path by shedding unprofitable assets and refocusing on building the deposit franchise, the medium term profit outlook remains impaired. We expect ROE to remain in single digits over the next 2 years. ICICI remains expensive on PE and PEG terms, while appearing cheap on P/Bx term. We maintain REDUCE”.

SBI ended flat during the week. A report released by IIFL during the week stated, “SBI’s 2QFY10 standalone net profit growth was relatively weak at 10%YoY while consolidated profits grew by 18%YoY. Associate banks’ profits grew by 46%YoY. NII was up 12%QoQ driven largely by 25bps QoQ NIM expansion. ROE of 15.7% and ROA of 0.95% for 1HFY10 are respectable, but relatively weak compared to the peer group. Tier-I CAR remains comfortable at 9.8% and capital raising is unlikely to be required in the near future. Long standing concerns on low NPL coverage and low ROE remain. The stock has out performed both the Sensex and Bankex over the past three months and now trades at 1.5x FY11ii consolidated P/B. We expect the stock to perform in line with the market in the near-term”.

The BSE Auto Index (up 3.3%): The top gainer in the auto space was Ashok Leyland. The stock rose over 16.5% during the week after the company reported a jump of 57% in its commercial vehicle sales at 5,333 units in October as compared to the same month in 2008.

Maruti Suzuki was up over 6.7% during the week after the company reported a 32.45% jump in total sales at 85,415 units in October compared to the same period last year.

Eicher Motors advanced 6% during the week after the company’s commercial vehicles sales rose 71% in October. It sold 2,024 trucks and buses in the month, compared with 1,183 units in the year-ago period.

M&M gained 4.8% after the company’s utility vehicle sales grow 32% in October.

Bajaj Auto gained 4.1% during the week after the company's motorcycle sales rose 52% in October 2009.

The top losers were Swaraj Mazda (down 2.3%) and Hindustan Motors (down 0.5%).

Hero Honda was down 1% during the week after the company reported a marginal increase in October sales at 354,156 units as against 352,449 units in the same month last year.

The BSE Oil & Gas Index (up 2.1%): The top gainers were GSPL (up 8.3%), MRPL (up 4.9%), Shiv-Vani Oil (up 2%) and HPCL (up 1.6%).

Cairn India advanced 2.5% during the week, a report released by IIFL during the weekstated, “Cairn India’s flagship Rajasthan block is well set to reach production of 175kbpd by CY2011. Pricing for Rajasthan crude—benchmarked to Bonny Light, with appropriate discounts—would benefit from narrow light-heavy spreads on OPEC production discipline. Cairn’s balance sheet is adequately funded to execute the Rajasthan project, with operating cash flows supporting exploration activities. While uncertainties remain on Rajasthan cess and offtake of peak crude volumes from Rajasthan, Cairn’s pipeline provides access to 75% of India’s crude refining capacity.
Cairn’s strong leverage to crude, along with strong operating cash, makes it attractive, in our view. Cairn’s current stock price is 6.8x its stable cash flow per share. We initiate with ADD rating and target price of Rs278/share”.

The top losers in the oil & gas space were Hindustan Oil (down 7.6%), Chennai Petroleum (down 5.5%), Jindal Drilling (down 2.9%), Reliance Industries (down 2.1%) and Essar Oil (down 1.4%).

The BSE Capital Goods Index (up 1%): The top gainers in the capital goods space were BEL (up 15.2%), Usha Martin (up 14%), BEML (up 9.6%), Dredging Corp (up 9.2%) and Jyoti Structures (up 8%).

The top losers were Alstom Projects (down 5.6%), Aban Offshore (down 3.9%), ABB (down 2.1%), Gammon India (down 1.9%) and Siemens (down 1.6%).

The Cement Sector: The top losers in the cement space were India Cements (down 8.4%), Mangalam Cement (down 5.1%), Madras Cements (down 4.9%), Prism Cement (down 4.4%) and Dalmia Cement (down 4.1%),

The top gainers were JK Cements (up 9.9%), Binani Indus (up 5.2%), Shree Cement (up 4.6%), Grasim (up 1.8%) and Birla Corp (up 0.1%).

A report released by IIFL during the week stated, “Cement prices in south and west regions have been falling steeply over the past two weeks, as the increase in supply is outstripping that in demand. At present, cement is cheapest in Hyderabad, at Rs123–145 per 50kg bag—down 18% in the past two weeks and 45% from the peak price reached in April 2009—the sharpest price fall in the past 15 years. According to dealers, price cuts have become a daily occurrence in the southern markets. In Gujarat, price declines have accelerated as supplies originally intended for exports have been diverted to the domestic market, given dwindling demand from the Middle East. Prices in the north have dropped by 2-3% in the past two weeks as supplies to the central region have reduced”.

The Telecom Sector: The top gainers in the telecom space were Gemini Comm (up 25.3%), MTNL (up 2.7%) and Shyam Telecom (up 1.7%).

The top losers were Idea (down 9.2%), Tata Communication (down 6.9%), RCom (down 6.1%), WWIL (down 4.4%) and TTML (down 2%).

Bharti Airtel advanced 2.6% during the week. According to a reports released by IIFL during the week stated, “A revenue decline of 1% QoQ, strong cost management (30bp increase in EBITDA%), FX loss of Rs0.7bn; a reduction in tower capex guidance ($1bn to $0.7bn), Rs2.2bn tax write back and PAT drop of 7.8% QoQ to Rs23.2bn characterised 2QFY10. Management commented that they would not match prices, but Bharti has just released a 1p/s (on-net) and 1.2p/s (off net), following a recent Rs0.5/min on-net and Rs0.6/min off-net plan. These plans make no distinction between local and STD calls (per minute plan is for pre-paid with voucher of Rs77 for 1yr validity). We model Rs0.55/min RPM for FY10, 580bn mobile min in FY10 (little elasticity assumed) and trim EPS by 12%-18%. We re-iterate REDUCE rating with a TP of Rs312”.

The Realty Sector (up 4.4%): The top gainers in the real estate space were HDIL (up 9.2%), Unitech (up 7.6%), Parsvnath (up 7.4%), Mahindra Lifespace (up 6.7%) and Peninsula Land (up 4.3%).

The top losers were Sobha Developers (down 8.2%), Omaxe Ltd (down 4.2%), Anant Raj Indus (down 1.4%) and Ansal Properties (down 0.2%).

The Metals sector (up 4.1%): The top gainers in the metals were Tata Steel (up 6.9%), Bhushan Steel (up 6.8%), JSW Steel (up 6.3%), Sunflag Iron (up 4.3%) and Lloyds Metals (up 3.2%).

The top losers in Metal were Ispat Industries (down 18.9%), Adhunik Metaliks (down 15.9%), Tata Sponge Iron (down 14.5%), Bhushan Steel (down 13.8%), Sunflag Iron (down 11.9%),

SAIL fell 1% during the week. IIFL in its report released during the week stated, “SAIL’s 2QFY10 PAT at Rs16.6bn (down 17% YoY and up 25% QoQ) was ahead of our estimate (Rs15.7bn) but in line with consensus.

• The positive surprise came from write-back of employee cost provisions.

• SAIL’s employee cost is unsustainably low and we expect it to increase by ~50% from this quarter’s level.

• SAIL has the highest conversion cost among Indian companies, on account of its bloated employee base and inferior product mix.

• Support from cash balance cannot be taken for granted, as we expect SAIL to turn net-debt in FY11 once full payment of the increased wages as per Sixth Pay Commission has been made and capex has increased.

• At its current price, the stock is trading at PE of ~14x on FY11ii—at a significant premium to its historical trading band. We retain SELL”.

Source : Indiainfoline.com

Aggregated by

Equity Research team

Ravina Consulting

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Weekly Analysis - Sectoral Review19-23 Oct 09

The run ahead of fundamentals came to a halt with keyindices closing lower this week. Besides the expected profit taking after aseven-month rally, the RIL-RNRL court battle added to the weakness. Quarterlynumbers from India Inc. also failed to cheer sentiment on Dalal Street. Finally, the BSE benchmark Sensex closed the week down by 3% and NSENifty closed lower by 2.8%.

The BSE Sensex hit an intra-weekhigh of 17,457 and low of 16,721 while, the NSE Nifty hit an intra-week high of5,182 and low of 4,968.

The Foreign Institutional Investors (FIIs) purchased Rs51.2bnduring the week. On the other hand, the Domestic Institutions were net sellers tothe tune of Rs15.7bn during the week.

The top gainers: The topgainers in the Sensex were TCS (up 10%), Tata Power (up 6.7%), DLF (up 4.9%),Hindalco (up 4.8%) and Wipro (up 2.4%).

The Top Losers: The toplosers in the Sensex were Grasim (down 10.3%), Tata Steel (down 7.8%), TataMotors (down 7.7%), L&T (down 7.2%) and Reliance Capital (down 6.9%).

The BSE IT Index up 3.6%:

The top gainer in the IT sector was TCS. The stock shot up over 10%during the week. According to report released by IIFL during the week, “TCSbeat our expectation with ~4% QoQ US$ revenue growth in 2QFY10—a number webelieve will be the best in this quarter among the top-3 vendors. Volumes grew~5% QoQ and EBITDA margin expanded by ~150bps, despite a hike in variablesalary payout (payout of 150%). The company’s products business is recoveringstrongly after a bad year—revenues are up 60% since 4QFY09. Stronger signs ofgrowth are also evident in its key vertical, BFSI (45% of revenues), astechnology integration deals ramp up. The appreciating rupee is a risk andpressures in the telecom, manufacturing and high-tech domains make a strongerrecovery unlikely. However, given stronger volume growth and margin expansion,we upgrade our FY10 and FY11 EPS estimates by 8% and reiterate ourrecommendation to switch from Infosys to TCS and Wipro.”

HCL Tech rose over 8% duringthe week. The company tied up with Microsoft to provide retail banking solutionto help banks in the Asia-Pacific.

Wipro was up 2.4% during theweek. The company entered into a 10-year IT outsourcing agreement with DelhiInternational Airport Ltd for providing IT infrastructure and services for IGIAirport here.

Mphasis (up 6%) and PatniComputer (up 4.6%) were among the other notable gainers.

The top losers were FinancialTech (down 5.7%), Mahindra Satyam (down 5.3%), Oracle Financial (down 4.1%) andSasken Communication (down 0.7%)

The BSE ConsumerIndex:

The top losers in the consumer durables space were Blue Star (down7.2%), Titan (down 3.9%), Videocon Industries (down 3.2%) and Su-Raj Diamonds(down 3.1%).

Whirlpool surged by over 10.2%during the week.

The BSE Healthcare Index down 1.4%:

The top losers were Panacea Biotec (down 7.3%),Divis Labs (down 5.4%), Ranbaxy (down 5.2%), Zandu Pharma (down 3.4%) and SuvenLife (down 3.3%).

The top gainers in the Pharma sectorwere Astrazeneca Pharma (up 18.2%), Strides Arcolab (up 9.2%), Dishman Pharma(up 6.3%) and Glaxosmithkline (up 3.7%).

The BSE Banking Index down 3.4%:

Thetop losers in were Bank of India (down 5.7%), Bank of Baroda (down 3.8%), ICICIBank (down 3.4%), Kotak Mahindra Bank (down 3.3%) and HDFC Bank (down 1.8%).

The top gainers in the banking spacewere Karnataka Bank (up 14.6%), Yes Bank (up 8.9%), Federal Bank (up 7.4%),Andhra Bank (up 7.1%) and Allahabad Bank (up 6.2%).

The BSE Auto Index down2.3%:

The top loser in the Auto space was Tata Motors. The stock fell 7.7%during the week. According to reports, the service tax department has issued ashow-cause notice to the company relating to a potential service tax liabilityof Rs3.25bn for five years between 2004-05 and 2008-09.

Despite spectacular quarterlynumbers, Bajaj Auto and Hero Honda were at the receiving end. Bajaj Auto slipped5.4% during the week. The company’s net profit in the second quarter of thisfiscal stood at Rs4.03bn against Rs1.85bn in the July-September 2008 period.Sales revenue for the company grew 15% in the period to Rs27.93bn againstRs24.2bn in the corresponding period.

Hero Honda fell 4.4% during theweek. According to a report released by IIFL during the week, “The company reportedPAT rose 95% YoY to Rs5.97bn—7% higher than our expectation. EBITDA margin expanded130bps QoQ to 18.3% (in 1QFY10, the company had spent Rs360m on advertisingduring Indian Premier League).

• But margin has likelypeaked—going forward, margins would be affected by rising commodity prices andincreasing competitive intensity in the two-wheeler space.

• The company produced 340,000vehicles during 2QFY10 at its Uttaranchal plant (tax incentives) and istargeting a production of 1.3m vehicles for FY10. Given the increasedproduction at Uttaranchal, the company’s tax rate fell 130bps QoQ to 22.3%.

• Management has revised itsguidance on FY10 tax rate from 24% to 22%. We raise our FY10 and FY11 EPSestimates by 8% and 6% as we revise our tax rate assumptions to 22% and 21%respectively. We maintain ADD with a revised target price of Rs1,850 (16xFY11ii).”

Among the other major loserswere M&M (down 3.4%) and Hindustan Motors (down 3.3%).

The top gainers were EicherMotors (up 2.5%), Swaraj Mazda (up 1.5%) and Ashok Leyland (up 0.2%).

Rico Auto Industries, facinglabour unrest since October 18, has reported a daily production loss of about25% at its Gurgaon plant, due to the unrest caused by a group of 16 employees.

The BSE Oil & Gas Index down 6.1%:

The top loser in oil & gas space was ONGC. Thestock was down by over 6.5% during the week. The Petroleum and Natural GasMinistry has suggested that the company explore the possibility of hiving offits Assam assetinto a wholly-owned subsidiary, stated reports.

Reliance Industries fell 5.7% during the week. TheSupreme Court said on the dispute between Reliance Industries and RNRL the twocould work out a “suitable arrangement” for the supply of gas if there is noprovision for arbitration as per the scheme of demerger between the two groups.

Shiv-Vani Oil (down 5.8%), MRPL(down 5.6%) and Jindal Drilling (down 4.7%) were among the other major losers.

The top gainers were GSPL (up5.3%), IOC (up 2.3%), Cairn India (up1.7%) and Gujarat NRE Coke (up 0.4%).

The BSE Capital Goods Index down 6%:

The top gainers in the capital goods sector wereKirloskar Brother (up 15.4%), Elgi Equipments (up 10%), Esab India (up5.7%), SKF India (up 3.7%) and Alfa Laval India (up2.8%).

The top losers were AstraMicrowave (down 8.3%) and Usha Martin (down 7.1%), LMW (down 5.9%).

L&T fell 7% during theweek. The company posted 26% rise in profit at Rs5.8bn in the second quarter,aided by a one-time gain from sale of its ready mix concrete (RMC) business andstake sale in a paper manufacturing joint venture.

BHEL was down 4.3% during the week. BHEL announced its Q2 net profitat Rs8.58bn registering a growth of 39% YoY as against Rs6.16bn in the sameperiod last year. While, net sales stood at Rs66.25bn as against Rs53.4bnposting a growth of 24% YoY.

The Cement Sector:

The toplosers in the cement space were Prism Cement (down 13.3%), Grasim (down 10.3%),JK Cements (down 7.2%) and Gujarat Sidhee (down 6.7%).

Ultratech Cement fell 8.5%during the week. A reports released by IIFL during the week stated that“UltraTech Cement’s (UCL) 2QFY10 result was largely in line with ourestimates—net sales up 10% YoY at Rs15.4bn; (against our expectation ofRs15.9bn); EBIDTA up 58% YoY at Rs4.7bn; and PAT up 53% YoY at Rs2.5bn (both inline with our estimates).

• Sales volume up only 5% YoY,despite sharp increase in capacities, as demand was sluggish in UCL’s keymarkets.

Blended realisation rose 6% YoYand 1% QoQ, but dropped 3% QoQ after factoring in freight expenses. We expectimpact of falling prices in UCL’s markets to reflect from 3QFY10.

• We largely retain ourearnings estimates (pre-merger) for FY10 and FY11. We will review our estimatespost announcement of merger ratio with Samruddhi Cement (SCL). We expect UCL tobenefit from the SCL merger, as it will make UCL the largest cement company in India with abalanced exposure to all regions (it currently has very high exposure to westand south markets). We maintain ADD on the stock.”

The top gainers were KakatiyaCement (up 1%) and Birla Corp (up 0.2%).

The Telecom Sector:

The toplosers in the telecom space were Himachal Futuristic (down 7.7%), Idea Cellular(down 5.6%), WWIL (down 4.1%), Shyam Telecom (down 2.6%) and TTML (down 2.1%).

The top gainers in the Telecom spacewere Gemini Comm (up 31.1%), Bharti Airtel (up 1.8%) and RCom (up 0.3%).

The Realty Sector down3.5%:

The top losers in the real estate sector were Parsvnath (down 8%),Ansal Props (down 4.5%), Unitech (down 3.9%), Sobha Developers (down 3.2%) and Peninsula Land (down2.9%).

The top gainers in Real Estatewere Anant Raj Indus (up 6.7%), DLF (up 4.9%), Mahindra Lifespace (up 4.5%) andAkruti City (up0.5%).

The Metals sector down1.7%:

The top losers in the Metals sector were Tata Steel down 7.8%, JSW Steel down 6.6%, Lloyds Metals down 6.3%, Jindal Stainless down 1.4% and Ispat Industries down 1.3%.

The top gainers were Monnet Ispat (up 6.3%), AdhunikMetaliks (up 5.4%), Sunflag Iron (up 4.6%), Bhuwalka Steel (up 2.2%) and TataSponge (up 1.6%).

Source : Indiainfoline

Weekly Review and outlook

Concerns over scanty rains and worries that the the initial public offer of NHPC may suck out liquidity from the secondary market triggered a correction on the bourses in the first week of August 2009. Weakness in Chinese stocks on talks that the Chinese central bank may rein in lending also weighed on investor sentiment.

Monsoon rains were 64% below the average in the week ended 5 August 2009. The cumulative deficit between 1 June 2009 and 5 August 2009 period widened to 25% from 19% a week earlier.

The June-September rains are the main source of irrigation for farms and are crucial for Asia's third-largest economy as more than two-thirds of the people live in villages and 60% of the farm land depends on the annual rains.

The BSE Sensex fell 510.07 points or 3.26% to 15,160.24 in the week ended 7 August 2009. The S&P CNX Nifty declined 155.05 points or 3.34% to 4481.40 in the week.

The BSE Mid-Cap index fell 137.77 points or 2.47% to 5,433.25 and the BSE Small-Cap index fell 12.07 points or 0.19% to 6,193.76.

Trading for the week began on an upbeat note as key benchmarks surged to a 14-month closing high on Monday, 3 August 2009. Sign of recovery in the Indian economy, better-than-expected Q1 June 2009 results from India Inc which just got over and buying by foreign funds underpinned sentiment. The BSE 30-share Sensex jumped 253.92 points or 1.62% to 15,924.23, its highest closing since 3 June 2008. The S&P CNX Nifty was up 74.95 points or 1.62% to 4,711.40, its highest closing since 3 June 2008.

Key benchmark indices edged lower on Tuesday, 4 August 2009, reversing gains in the preceding three trading sessions, as lower European stocks and US index futures triggered profit taking. The BSE 30-share Sensex fell 93.25 points or 0.59% to 15,830.98. The S&P CNX Nifty fell 30.90 points or 0.66% to 4,680.50.

A recovery in European stocks helped Indian equities score gains in what was a choppy trading session on Wednesday, 5 August 2009. Sustained buying by foreign funds and an expected economic recovery in India underpinned sentiment. The BSE 30-share Sensex rose 72.85 points or 0.46% to 15,903.83. The S&P CNX Nifty gained 13.65 points or 0.29% to 4,694.15.

The Key benchmark indices nosedived in the fag end of the trading session on Thursday, 6 August 2009, led by fall in auto, metal, realty and FMCG stocks. The sharp slide materialised after television reports said that the monsoon rains were 66% below normal the week to 5 August 2009. The BSE 30-share Sensex fell 389.80 points or 2.45% to 15,514.03. The S&P CNX Nifty fell 108.65 points or 2.31% to 4,585.50.

The key benchmark indices tumbled on Friday, 7 August 2009, posting second straight day of losses, as weak global stocks and below normal rains weighed on investorsentiment. Strong response to the initial public offer (IPO) of NHPC raised concerns it will suck out liquidity from the secondary market. The BSE 30-share Sensex fell 353.79 points or 2.28% to 15,160.24. The S&P CNX Nifty fell 104.10 points or 2.27% to 4481.40.

India's largest private sector firm by market capitalisation and oil refiner RelianceIndustries (RIL) rose 1.98% in the week. Petroleum minister Murli Deora in Parliament on Thursday, 6 August 2009 said that the price approved by the empowered group of ministers (eGoM) for RIL gas from the KG D6 field was lower than the price it had approved for some of the other operators in the country.

Deora said the price of $4.2 was lower than the price of $5.5 charged for gas from the Panna-Mukta-Tapti (PMT) field by a group consisting RIL, ONGC and British Gas. The Anil Ambani group (ADAG) had called the price of $4.2 exorbitant, pointing out that most of the natural gas in the country is being sold at $1.8 to $2.4 per unit.

The Ambani brothers have been at loggerheads since the death of their father in 2002, and a 2005 settlement saw the Reliance group split into two. The Supreme Court on 30 July 2009 said, it will give a date on 1 September 2009 to expedite the decision.

Shares of three public sector oil marketing companies advanced as a hike in retail fuel prices in early July 2009 may boost Q2 September 2009 results. Hindustan Petroleum Corporation (HPCL) (up 5.74%), Bharat Petroleum Corporation (BPCL) (up 10.52%) and Indian Oil Corporation (IOC) (up 1.76%), rose. On 1 July 2009, the government had hiked petrol price by Rs 4 per litre and diesel by Rs 2 per litre.

The three public sector oil marketing firms reported strong Q1 June 2009 results as they incurred negligible underrecoveries on domestic sale of fuel at controlled prices. The strong performance was despite lack of any oil bonds from the government.

Power stocks fell even as the NHPC IPO received a robust response from investors. Reliance Infrastructure (down 4.85%), Tata Power Company (down 5.89%), CESC (down 2.73%), Torrent Power (down 2.88%) and Reliance Power (down 4.74%), declined.

The IPO of NHPC, which opened for subscription on 7 August 2009, was subscribed 3.22 times by 15:00 IST that day. The IPO received bids for 540.25 crore shares compared to the issue size of 167.7 crore shares. NHPC is planning to raise Rs 6,040 crore at the upper end of the issue price band of Rs 36. The government kickstarts the divestment process by selling shares in NHPC.

NHPC is selling 167.7 crore shares comprising of 5% divestment of stake by the government and infusion of 10% fresh equity. The strong response for the first state-run IPO in 18 months could embolden the government to sell stake in more firms.

Bank stocks fell as state-run banks remained shut for two days in a row on Thursday and Friday following a nationwide strike by their employees demanding higher wages and pensions. India's biggest bank in terms of branch network State Bank of India (SBI) fell 3.98%

Other PSU stocks, Bank of India (down 1.03%), Indian Overseas Bank (down 5.94%), Bank of Baroda (down 2.55%), Union Bank of India (down 2.61%), declined.

State-run banks account for more than half of banking sector assets and have a dominant presence in the fixed income and foreign exchange markets.

Among the private sector lenders, India's largest private sector bank by net profit ICICI Bank fell 2.77%. India's second largest private sector bank by net profit HDFC Bank fell 7.14%.

Auto stocks fell on profit taking after recent surge triggered by healthy monthly sales figures for July 2009 and good Q1 June 2009 results. Weak monsoon also triggered profit taking as auto firms derive substantial revenue from rural India. Mahindra & Mahindra (down 2.64%), Bajaj Auto (down 4.02%), Hero Honda Motors (down 7.74%), and Maruti Suzuki India (down 8.63%), TVS Motor Company (down 9.92%), fell.

India's largest truck market by sales Tata Motors fell 1.67%. Global ratings agency Standard & Poor's downgraded long term corporate credit rating of the auto major to 'B' from 'B+'. The outlook is negative. At the same time, Standard & Poor's lowered the issue rating on the company's senior unsecured notes to 'B' from 'B+'.

Rate sensitive realty shares declined on profit booking after recent strong gains triggered by of the government's thrust on housing sector in the Union Budget 2009-2010. Unitech (down 4.55%), Omaxe (down 4.92%), DLF (down 6.99%), Anant Raj Industries

Weekly review as of 3 July 2009

Stock and sector-specific buying was the order of the day based on expectations of sops in the Union Budget 2009-2010. Oil stocks rose after the government unexpectedly hiked petrol and diesel prices. Shares of state-run firms rose on hopes the government will revive stake sale in the current year. Construction shares were in demand on a likely thrust of the budget on the infrastructure sector which may boost orders for construction firms.

The 30-share BSE Sensex rose 148.41 points or 1.01% to 14,913.05 in the week ended Friday, 3 July 2009. The BSE Small-Cap index rose 24.20 points or 0.42% to 5,824.95 in the week. The BSE Mid-Cap index 16.32 points or 0.32% to 5,187.22 in the week.

Stocks have risen sharply in the past four months or so, on heavy buying by foreign funds. The Sensex is up 5,265.74 points or 54.58% in calendar year 2009 as on 3 July 2009. From a 3-year closing low of 8,160.40 on 9 March 2009, the Sensex has risen 6,752.65 points or 82.74% as on 3 July 2009.

A strong global liquidity and increase in risk appetite boosted inflows after a comfortable victory for the Congress-led UPA government in parliamentary elections raised expectations of economic reforms. Foreign institutional investors (FIIs) bought shares worth a net Rs 25,109.90 crore in calendar 2009 (till 2 July 2009).

Trading for the week began on a positive note as the Sensex inched up 21.10 points or 0.14% on Monday, 29 June 2009. But the market dropped the next day as a rush to raise funds through share sales by corporate India raised concerns that a glut in share sales will suck liquidity from the secondary market. The BSE Sensex lost 291.90 points or 1.97%, on Tuesday, 30 2009.

Brokers expect companies to raise over $10 billion in the current financial year by way of share placements and initial public offers. The raising of funds will help corporates finance expansion and reduce debt. But it will result in equity dilution which the stock market normally does not like due to earnings dilution.

Data showing strong auto sales in the month just gone by, firm global markets and speculative build up of positions in the run up to the budget, triggered a recovery the next day. The BSE 30-share Sensex gained 151.63 points or 1.05%, on Wednesday, 1 July 2009

The latest macro data confirmed that the economy is recovering. The Markit Purchasing Managers' Index (PMI) based on a survey of 500 companies, held above the threshold of 50 in June 2009 that separates expansion from contraction.

The key benchmark indices ended a choppy trading session flat on Thursday, 2 July 2009. The BSE 30-share Sensex rose 13.02 points or 0.09%. The annual economic survey by the finance ministry in parliament during trading hours suggested a strong push for policy reforms. The survey also called for sweeping tax reforms.

Stocks surged on Friday, 3 July 2009, after the Railway Minister Ms Mamta Banerjee announced a number of new initiatives in the 2009-2010 Rail Budget including a plan to improve infrastructure facilities across a large number of railway stations. The progress of India's annual monsoon also aided sentiment. The Indian meteorological department said that monsoon has covered the entire country. The quantum and distribution of rain in this crucial sowing month holds key.

India's biggest commercial vehicles maker by market share Tata Motors came under selling pressure after reporting a net loss of Rs 2505.25 crore in the year ended March 2009 on consolidated basis as compared with net profit of Rs 2167.70 crore in the year ended March 2008. Net sales jumped 98.73% to Rs 70370.40 crore in the year ended March 2009 over the year ended March 2008. However the figures are not comparable as the year-ago numbers did not include that of Jaguar and Land Rover, as well as some other assets the company bought and sold during the year.

PSU OMCs rose after the government announced a hike petrol and diesel prices after trading hours Wednesday, 1 July 2009. BPCL rose 9.22% to Rs 459.80, HPCL rose 9.4% to Rs 330.95 and Indian Oil Corporation rose 4.59% to Rs 562.60 in the week.

Higher fuel prices will reduce underrecoveries at the state-run oil firms on domestic sale of petrol and diesel at a controlled price. Petrol price was hiked by Rs 4 per litre and diesel by Rs 2 per litre.

India's biggest state-run oil exploration firm ONGC surged after chairman and Managing Director R. S. Sharma said the company's fuel subsidy burden for the current year will be significantly lower than the previous year, if the crude prices stay around the current level. India's largest private sector firm by market capitalisation Reliance Industries (RIL) was almost unchanged in the week. The company said on Wednesday, 1 July 2009, it would appeal to the Supreme Court against a ruling that it should enter into a gas supply agreement with former group firm Reliance Natural Resources (RNRL).

RIL had said on Tuesday, 30 June 2009, it could not sign a gas supply agreement with Reliance Natural Resources (RNRL) as there was no clarity on government approval for the terms. RIL said it wanted the terms such as price, quantity and tenure to be subject to government approval. The Bombay High Court, in its order dated 15 June 2009, had directed that Anil Ambani's RNRL will get assured gas supply of 28 million metric standard cubic metre per day (mmscmd) of gas from RIL's Krishna-Godavari basin for 17 years at $2.34 million per metric British thermal unit (mmbtu). This is 44.28% less than the price fixed by the government for gas sale from the RIL block in the KG basin at $4.2 million per metric British thermal unit.

Shares of India's biggest dedicating housing finance firm by operating income rose 6.19% to Rs 2586.25 in the week on market talks the government may increase tax sops on housing loan.

India's largest private sector aluminium maker by sales Hindalco lost 3.35% to Rs 83.75 in the week after consolidated net profit declined 77.88% to Rs 485 crore in year ended March 2009 over year ended March 2008. Net sales rose 9.35% to Rs 65625 crore in year ended March 2009 over year ended March 2008. The results were announced during market hours on Tuesday, 30 June 2009.

The company's board of directors approved raising funds upto $500 million by selling shares to institutional investors.

Power stocks rose on expectations of a thrust to the power sector in the Union Budget 2009-2010. India's biggest thermal based power generation firm by revenue NTPC rose 4.82% to Rs 204.35. One of the expectations is that the government may extend income tax benefit under section 80-IA. The tax benefit available to project developers ends this year.

Source : capitalmarket