*Market expected to open weak
*Indian market is expected to open weak on weak global markets. The US
market ended the session with steep losses on poor housing and employment
data. Asian markets are also trading with losses.
*Technical Analysis
*After a positive opening on Thursday, the Nifty started to shed in line
with our expectation. In the daily charts, both the oscillators are in over
bought zone. The Nifty pierced the upper line of bollinger band as an intra
day move and closed below that line. Normally, it is construed as a negative
sign or the exhaustion of the previous move. In addition, the Nifty futures
and Sensex are facing tough resistance near to the gap formed on 19th June.
The Nifty is facing stiff resistance near the 50-day "SMA" and 89 day " EMA"
during any up move. The Nifty would need more strength to clear these levels
on a closing basis. In the hourly charts, the Nifty lost the support of
"PSAR". The MACD histogram in the hourly charts becomes negative.
All these suggests, the Nifty is expected to consolidate at higher level or
expected to trade weak further. However, the under current is bullish and
some more technical weakness can be expected before moving up further.
The Nifty has support at 4377, 4325, 4264 and 4215. The Nifty has resistance
at 4569-4582 (very strong for the short term), 4646-4666 (very strong for
medium term). Any weekly close above 4427 or a trade above 4646 will
initiate a fresh upward momentum.
*Strategy
*One can use upward move to trim their long positions.
*25 July 08*
*M A R K E T S C A N*
BENCHMARK INDICES
*Clsg*
*Chg%*
Sensex
14777
-1.11
Nifty
4433
-0.97
BSE 200
1790
-0.97
BSE Midcap
5580
-0.62
BSE Smallcap
6796
-0.24
NASDAQ
2280
-1.97
Dow Jones
11349
-2.43
SECTORAL INDICES (BSE)
*Clsg*
*Chg%*
Auto
3771
0.08
Bankex
7163
-1.76
PSU
6728
0.01
Pharma
4183
-0.22
IT
3630
-2.77
ADVANCES / DECLINES BSE CASH
*Adv (%) *
*Dec(%) *
BSE 30
26.67
73.33
BSE 200
36.00
64.00
BSE 500
37.27
62.12
Total BSE
45.20
52.39
MARKET TURNOVER (Rs.Cr)
*24/07*
*23/07*
BSE Cash
7445
7467
NSE Cash
17670
20418
NSE F&O
58129
68010
BSE Delivery %
29.61
33.78
COMMODITIES, FOREX & DEBT
*Clsg*
*Chg%*
Crude Brent $Bbl
125.22
0.34
Gold Rs/ 10 Gms
12606
-1.09
Silver Rs/ Kg
24376
-0.72
Rs - US $.
41.96
0.87
Rs - Euro.
65.82
-1.39
10 yr G-Sec
9.05
0.03
FII/MF (Rs.Cr)
**23/07*
*22/07*
FIIs
1635.60
-390.50
MFs
334.50
373.90
*Date refers to the day of activity and not the day on which it is reported.
*C O R P O R A T E N E W S *
Companies declaring their results today
3i Infotech Ltd.
Krebs Biochemicals & Industries Ltd.
3M India Ltd
Machino Plastics Ltd.
ABB Ltd.
Mack Trading Company Ltd.
Albright & Wilson Chemicals India Ltd.
Mangalore Chemicals & Fertilizers Ltd.
Alpha Geo (India) Ltd.
Mangalore Refinery And Petrochemicals Ltd.
Alstom Projects India Ltd.
Micro Technologies (India) Ltd.
Ambuja Cements Ltd.
Mid-Day Multimedia Ltd.
Amforge Industries Ltd.
Mipco Seamless Rings (Gujarat) Ltd.
Andhra Bank
Miven Machine Tools Ltd.
Anjani Portland Cement Ltd.
MM Forgings Ltd.
Ashiana Agro Industries Ltd.
Modern Dairies Ltd.
Ashnoor Textile Mills Ltd.
Modern Steel Ltd.
Asian Star Company Ltd.
MphasiS Ltd.
Barak Valley Cements Ltd.
Mukta Arts Ltd.
Bhuwalka Steel Industries Ltd.
Nagarjuna Fertilisers & Chemicals Ltd.
Blue Coast Hotels & Resorts Limited
Nettlinx Ltd.
Ceat Ltd.
Noida Toll Bridge Company Ltd.
Chowgule Steamships Ltd.
Onward Technologies Ltd.
CMS Infotech Ltd.
Oriental Bank of Commerce
Conart Engineers Ltd.
Ortin Laboratories Ltd.
Cravatex Ltd.
Panyam Cements & Mineral Industries Ltd.
Educomp Solutions Ltd.
Paper Products Ltd.
Emami Ltd.
Pondy Oxides & Chemicals Ltd.
Engineers India Ltd.
Rajapalayam Mills Ltd.
English Indian Clays Ltd.
Rajkumar Forge Ltd.
Enkei Castalloy Ltd
Ras Resorts & Apart Hotels Ltd.
Everest Industries Limited
Redington (India) Ltd.
Flag Finin Ltd.
Reliance Natural Resources Ltd.
Fulford (India) Ltd.
Reliance Power Ltd.
Gateway Distriparks Ltd.
Rolcon Engineering Company Ltd.
Grasim Industries Ltd.
RPG Cables Ltd.
GRUH Finance Ltd.
Salora International Ltd.
Gujarat State Fertilizer & Chemicals Ltd.
Sanguine Media Ltd.
Gujarat State Petronet Ltd.
Schrader Duncan Ltd.
Hawkins Cookers Ltd.
Shalimar Paints Ltd.
Hercules Hoists Ltd.
Shivam Autotech Ltd.
Himadri Chemicals & Industries Ltd.
Shree Pacetronix Ltd.
Hind Rectifiers Ltd.
Shri Ganesh Spinners Ltd.
Hindustan Composites Ltd.
SKumars Online Ltd.
Hindustan Construction Company Ltd.
Sonata Software Ltd.
Hindustan Foods Ltd.
SRF Ltd.
Hindustan Motors Ltd.
Stovec Industries Ltd.
Hindustan Unilever Ltd.
Sudal Industries Ltd.
Hindusthan National Glass & Industries Ltd.
Suven Life Sciences Ltd.
I-Flex Solutions Ltd.
Take Solutions Ltd.
Indiabulls Financial Services Ltd.
Tata Power Company Ltd.
Indiabulls Securities Ltd.
Titan Trading & Agencies Ltd.
Indian Hotels Company Ltd.
TTK Healthcare Ltd.
Indraprastha Medical Corporation Ltd.
TTK Prestige Ltd.
Inox Leisure Ltd.
Union Bank of India
Integral Knit Co.Ltd.
United Breweries Ltd.
Ion Exchange (India) Ltd.
Universal Office Automation Ltd.
Ipca Laboratories Ltd.
Vajra Granites Ltd.
JB Chemicals & Pharmaceuticals Ltd.
Varun Industries Ltd.
Jindal Steel & Power Ltd.
Vedant Hotels Ltd.
JL Morison (India) Ltd.
Vinati Organics Ltd.
JM Financial Ltd.
Vipul Ltd.
Kajaria Ceramics Ltd.
VTM Ltd.
Kar Mobiles Ltd.
Welcast Steels Ltd.
Karnataka Bank Ltd.
Whirlpool of India Ltd.
Karuna Cables Ltd.
Zen Technologies Ltd.
Karur Vysya Bank Ltd.
Zenith Birla (India) Ltd.
Particulars
IMPACT
The government has cleared the merger of State Bank of Saurashtra with *State
Bank of India*, moving ahead on a deal that had been stalled because of
opposition from trade unions supported by Left parties.
*Reliance Industries Ltd* (RIL) has reported a 13 % increase in net profit
for the first quarter ended June 2008, as it was able to sell its products
at higher prices and also because of doubling of export sales. The firm has
reported a net profit of Rs 41.1 bn (earnings per share (EPS) of Rs 28.3)
for the quarter ended June 2008, against Rs 36.3 bn (EPS of Rs 25) in the
year-ago period. Turnover in the first quarter of fiscal 2009 increased 41 %
to touch Rs 418 bn against Rs 297 bn in April-June 2007. Nearly 95 per cent
of the increase in turnover was due to increase in prices, with volume
increases accounting for the rest. One of the primary reasons it was able to
export more was due to the company's decision to shut down 1,432 petrol
pumps it owned in India.
*Oil and Natural Gas Corporation* (ONGC), plans to enter uranium mining in
alliance with public-sector Uranium Corporation of India, aiming to tap the
business opportunity from nuclear fuel shortage. ONGC is aligning with
Uranium Corporation, as the latter is the only entity allowed to undertake
uranium mining in India, and has the power to allot mining leases to others
like ONGC.
*Pantaloon Retail* has approved a proposal to give shareholders one bonus
share with different voting and dividend rights for every 10 held. The new
shares called Class B shares will get 5 % more dividend than ordinary shares
and would be entitled to one vote for every 10 held. The record date will be
fixed after the necessary approvals are obtained by the company.
*Reliance Infrastructure* (R-Infra), which plans to set up a $3-billion
joint venture with Shanghai Electric Power Co to make power equipment in
India, is setting up four more joint ventures with the Chinese partner to
offer a range of third-party services to power utilities in India. The
ventures would involve a combined investment of $400-600 million. Details of
the stake to be taken by Reliance-ADAG in the joint ventures are still not
known.
Pharma majors like *Cipla, Ranbaxy* and US Vitamin (India) may have to cough
up over Rs 15.6 bn for overcharging customers on price-controlled medicines.
Through a nation-wide survey done over a year, National Pharmaceutical
Pricing Authority (NPPA) has found that pharma companies were overcharging
or selling without price approval more than 530 items used for various
ailments including cancer and asthma. Out of Rs 15.6 bn estimated by the
NPPA as 'overcharged' amount, Cipla accounts for nearly Rs 7.5 bn.
*Gujarat Alkalies* and Chemicals (GACL) has formed a joint venture for
setting up an Rs 6 bn plant at Dahej with Dow Chemicals. The new joint
venture company is registered as" DOW-GACL Solvdenture", which has a 50:50
equity partnership. The plant will be commissioned by 2011.
*Bharti Airtel *has posted a growth of 34 % in net profit at Rs 20.3 bn in
the first quarter ended June 2008 compared with the previous corresponding
period. With over 7.5 million new customers added this quarter, the highest
ever in a quarter, its consolidated revenues jumped 44 % to Rs 84.8 bn. The
average revenue per user (ARPU) fell to Rs 350 (Rs 357 in the January-March
quarter). The average monthly minutes of usage per subscriber showing
registered a healthy increase of 5 % to 534 minutes per month over the last
quarter. The company also increased its market share to 24.2 % (23.5 per
cent in June 2007).
*Idea Cellular* posted a net profit of Rs 2.69 bn in the first quarter ended
June 30, 2008, down by 12.66 %, compared to Rs 3.08 bn in the same quarter
of the previous financial year. The net profit declined due to forex losses
incurred during the quarter. The total income rose by 47.2% to Rs 21.8 bn
during the quarter under review, as against Rs 14.8 bn crore in the
comparable quarter a year ago. EBITDA of Rs 7.2 bn grew 40.2 % on a
year-on-year basis. The company added 3.19 million subscribers during the
quarter, taking its total subscriber base to 27.19 million. In its 11
circles, the company consolidated the subscriber market share from 9.4 % at
the end of the March quarter to 9.6 % at the end of the June quarter.
*ACC *reported a 27 % decline in net profits in the June quarter due to the
rising input costs. The company posted a net profit of Rs 2.6 bn in the
quarter ended June 30 compared to Rs 3.5 bn in the corresponding quarter
last year. The net sales grew by 1.52 % to Rs 19.2 bn against Rs 18.9 bn
last year. The sales volumes in the quarter dipped 1.3 % to 5.29 million
tonnes from 5.36 million tonnes in the corresponding quarter last year.
*Crisil* announced a consolidated net profit of Rs 355 mn for the second
quarter (Q2) ended June 30, 2008, a more than two-fold growth over the
corresponding period a year ago on higher demand for bank loan ratings
besides others. The consolidated total income rose to Rs 1323 mn in the
second quarter from Rs 969 mn in the year-ago period, a rise of 36.5%.
Despite showing strong growth in terms of revenue, *Aztecsoft* posted a net
loss of Rs 92.9 mn for the first quarter ended June 2008 in the wake of
foreign exchange losses due to the rupee depreciation. In the first quarter
of FY08, the company had posted a net profit of Rs 570 mn. The revenue of
the company grew by 30 % year-on-year to Rs 767 mn on the back of a strong
demand from existing clients.
*Zensar Technologies* reported a net profit (consolidated) growth of 85 %
following a high utilisation rate, forex gain and increasing focus on its
solutions offering and emerging markets. Net profit for the quarter was Rs
247.3 mn from Rs 133.5 mn in the last year.
Focus on the Indian and Europe markets and on sectors such as defence and
engineering services has resulted in *Rolta India* post a 4 % jump in net
profit for the fourth quarter ended June 2008. The company reported a net
profit of Rs 508.3 mn (Rs 488.5 mn) in the quarter. Revenues at Rs 3.07 bn
(Rs 2.07 bn) were up 48.3 %. Sequentially, the net profit dipped by 23 %
from Rs 657.2 mn because of a provisioning of Rs 301.8 mn due to forex
losses on foreign currency convertible bonds.
*Bajaj Electricals* registered a net profit increase of 28.77 % at Rs 100.1
mn for the quarter ended June 2008 compared with Rs 77.8 mn in the same
period last year. Total income rose by about 26 % to Rs 3.18 bn.
*Piramal Healthcare* has posted a 57 % increase in net profit for the
quarter ended June 2008. The profits rose on the back of a better
performance in the domestic market with focus on speciality products and
increase in revenues from its contract manufacturing business. The company
posted a net profit of Rs 680.9 mn for the period, in comparison to Rs 434.1
mn in the year-ago. Total income grew by 16.1 % to Rs 7.08 bn compared with
Rs 6.10 bn in the previous year period.
*Marico* has recorded a net profit growth of 15.2 % for the first quarter
ended June 2008 led by volume growth in key categories like hair oil and
edible oil. Its consolidated net profit for the quarter was Rs 463 mn
compared with Rs 402 mn in the same quarter last year. Net sales grew by
28.1 % to Rs 6 bn as against Rs 4.69 bn in the same period last year.
*United Phosphorus* posted a two-fold increase in its profit after tax at Rs
1,476.70 million for the quarter ended Jun. 30, 2008 as compared to Rs
737.80 million for the quarter ended Jun. 30, 2007. The total Income has
increased 55.50% from Rs 8.5 bn for the quarter ended Jun. 30, 2007 to Rs
13.1 bn for the quarter ended Jun. 30, 2008.
*Patni Computer Systems* has posted nearly 49% sequential growth in net
profit for the second quarter ended June 2008 to Rs 1.2 bn. Revenues for the
same period grew 10.7% to Rs 7.67 bn. The other income increased 173.4%
quarter-on-quarter to Rs 49.3 crore. Patni's dollar revenues increased 3.5%
sequentially. However, revenues from its top-client, General Electric (GE)
fell from 11.1% in the previous quarter to 10.4% in Q2 FY09.
*Hindustan Zinc* announced a net profit of Rs 8.5 bn for the first quarter
ended June 30, a decline of 30% over the corresponding period last year. The
company had posted a net profit of Rs 12.1 bn for the quarter ended June 30,
2007. Total income decreased to Rs 18.5 bn from Rs 22.7 bn for the year-ago
quarter.
The board of directors of *TV Today Network Ltd* will consider buy-back of
company's shares at meeting of the Company will be held on July 31, 2008.
Impact of the news flow expected to be positive on the highlighted
company. Impact of the news flow expected to be negative on the highlighted
company. Impact of the news flow expected to be neutral on the highlighted
company. The impact (up / down / neutral arrow) does not signify the
expected stock price movement of the company.
*E C O N O M I C N E W S *
The annual wholesale price index-based *inflation* rose 11.89 % during the
week ended July 12, marginally lower than the previous week's annual rise of
11.91 .The year-on-year inflation rate was 4.76 % during the corresponding
week of the previous year. On a disaggregated basis, the Primary Articles
group index rose 0.6 % as the index for 'Food Articles' group rose by 0.6 %.
The index for 'Non-Food Articles' group rose by 0.8 per cent for the
previous week.
The *Telecom* Commission today said it has decided to waive licence fees on
rural landline telephone operations to improve penetration of telephony in
the country. The waiver will amount to 2 bn rupees a year. The government
has also decided to bring down the universal service obligation charge to 3%
from 5% of the adjusted gross revenue for those
service providers who already cover more than 95% of rural areas.
The Reserve Bank of India (RBI) has issued a set of detailed norms on *credit
card transactions* by banks. Cautioning banks against charging excessive
rates, RBI said the interest rate and other charges on credit card dues fall
within the purview of the RBI circular, which prohibits banks from charging
excessive interest rates on personal loans and prescribes a rate ceiling on
small advances. The central bank said banks will also be penalised severely
for issuing unsolicited credit cards to customers. If such unsolicited cards
are issued and activated without the consent of the recipient, with the
latter being billed for the same, the card issuing bank shall reverse the
charges and pay a penalty without demur to the recipient twice the value of
the charges reversed.
India has relaxed tight hiring rules announced in April for ships registered
outside the country that are used for *exploring and drilling for oil and
gas* off its coast, on the back of lobbying by oil firms and foreign
shipowners. Companies can now hire offshore vessels that are more than 25
years old, subject to certain conditions.
Ten Indian government owned *power firms* that have resisted a directive to
sign an "integrity pact" with Transparency International India (TII), the
local chapter of a global non-profit that tries to combat corruption, have
now been given three months to do so. Signing the pact means that the
companies have to guarantee transparency in their public procurement deals.
The power companies that did not sign the pact were NTPC Ltd, Bhel, Damodar
Valley Corp., Rural Electrification Corp. Ltd, Power Finance Corp. Ltd
(PFC), Power Grid Corp. of India Ltd, North Eastern Electric Power Corp.
Ltd, Tehri Hydro Development Corp. Ltd, Satluj Jal Vidyut Nigam Ltd, NHPC
Ltd and Bhakra Beas Management Board.
*G L O B A L M A R K E T*
DJIA and NASDAQ Composite
U.S. stocks declined, after home sales slid more than forecast and investor
Bill Gross predicted the housing slump will cost banks and brokerages $1
trillion. The S&P 500 dropped 29.65 points, or 2.3 percent, to 1,252.54. The
Dow Jones Industrial Average slid 283.1, or 2.4 percent, to 11,349.28. The
Nasdaq Composite Index tumbled 45.77, or 2 percent, to 2,280.11.
FTSE 100
U.K. stocks fell, led by mining shares as metal prices retreated. The FTSE
100 dropped 87.6, or 1.6 percent, to 5,362.3.
Nikkei 225 (Closed at 13603 on Thursday)
Japan's stocks dropped, on concern that the nation's export market will
shrink after U.S. home sales fell to the lowest in a decade and Canon Inc.
reported a decline in profit on slowing overseas sales. The Nikkei 225 Stock
Average declined 209.50, or 1.54 percent, to 13,393.81 as of 10:00 a.m. in
Tokyo.
*GLOBAL INDICES *
*Clsg*
*Chg%*
Dow Jones
11349
-2.43
NASDAQ
2280
-1.97
FTSE 100
5362
-1.61
Bovespa
57434
-3.34
Latest
Chg%
Nikkei
13393
-1.54
Hang Seng
22653
-1.88
*C O M M O D I T I E S*
**
*Gold**
($ per Troy oz)*
*Aluminium
($ per tonne)***
*Copper
($ per tonne)***
*Nickel
($ per tonne)***
*Zinc
($ per tonne)***
*Crude Oil
( $ per barrel)***
**
LBM/ COMEX**
LME**
LME**
LME**
LME**
Brent Blend**
NYMEX Future**
Cash**
921.30
2937
8260
19010
1892
125.22
N.A.
%Change**
-0.71
-1.01
-0.60
-6.05
0.32
0.34
N.A.
Future**
922.30
2988
8032
19255
1901
N.A.
125.56
%Change**
-0.05
-0.96
-0.96
-5.64
0.26
N.A
1.03
Precious Metals
Gold fell, as the dollar rose to a two-week high against the euro, eroding
the appeal of the precious metal as an alternative investment.
Base Metals
Copper fell, as a stronger dollar reduced demand from investors seeking a
hedge against inflation.
Crude Oil
Crude oil gained in New York, as some traders purchased contracts on
speculation prices fell too far during the past two weeks.
**
Disclaimer:
*This document has been prepared by the Research Desk of Asit C Mehta
Investment Interrmediates Ltd. and is meant for use of the recipient only
and is not for circulation. This document is not to be reported or copied or
made available to others. It should not be considered as an offer to sell or
a solicitation to buy any security. The information contained herein is from
sources believed reliable. We do not represent that it is accurate or
complete and it should not be relied upon as such. We may from time to time
have positions in and buy and sell securities referred to herein.*
