Cluster: Apple Green
Price target: Rs63.4
Current market price: Rs55
Margins disappoint, but stay on course!!
Cluster: Apple Green
Price target: Rs406
Current market price: Rs379
Cluster: Apple Green
Price target: Rs900
Current market price: Rs825
Price target revised to Rs900
Cluster: Emerging Star
Price target: Rs425
Current market price: Rs318
Cluster: Apple Green
Price target: Rs558
Current market price: Rs370
Q1CY2007 results—first cut analysis
Price target: Under review
Current market price: Rs217
Q4FY2007 results—first cut analysis
No Ta Ra Rum Pum, Bulls settle down
Bulls would have hoped to have yet another winning week and chill out for the weekend. However, it turned out to be a fatal Friday as the indices wiped off most of the gains for the week. Friday's fall was on account of profit booking and weak Asian markets. Next week we have a shortened trading week (Tuesday and Wednesday are holidays).
Strong global markets, short-covering of positions in the F&O segment due to settlement and encouraging Monetary Policy kept the bulls in good spirits through the week, barring Friday. Strong inflows from FIIs and good quarterly results aided the rally. The main indices managed to squeeze out some gains on a week on week basis keeping their winning streak alive for a third consecutive week.
Index heavyweights helped the indices climb higher in an action-packed week with a slew of corporate earnings, and much hyped RBI meet on credit policy. Dr. YV Reddy decided to take a pause in his long sequence of monetary tightening measures leading to a frantic buying in Bank, Real Estate and Auto stocks, which had been battered a lot over last two months.
Tata Power, ACC, Tata Motors and SBI were major gainers in the 30 Sensex stocks. On the other hand, Cipla, BHEL, Infosys and Dr Reddy's were among the notable losers. Finally, the Sensex added 11 points or 0.08% to close at 13908.58 and the NSE Nifty closed flat at 4083.5.
Real Estate, Construction & property stocks had been on the receiving end in recent times following increase in interest rates by RBI over last two months, got some relief after RBI decided to keep key lending rates unchanged to support slowing economic growth. Also, RBI declared that they would reduce risk-weighting on individual loans to 50% from current 75%, which droved the stock prices higher over the week. Nagarjuna Construction, IVRCL Infra, Parsvnath Developers, Bombay Dyeing and Sobha Developers were among the notable gainers.
Finally, Banking stocks find some taste with the investors following heavy battering over two months across the sector. However, RBI's decision to leave the key Interest rates unchanged propelled the banking stocks higher with Index heavy weight SBI leading from front adding over 2.5% to close at Rs1101. ICICI Bank advanced by 2% to Rs935 and HDFC Bank added 2% to Rs1015. PNB, Union Bank, Indian Bank and Bank of India gained in the range of 4-18%.
Series of rate hikes by RBI had taken its toll on the Auto stocks over last two months. However, Tuesday proved to be an adventurous day for the Auto stocks, as they gained smartly after the RBI left its key overnight lending rate unchanged to spur economic growth. Maruti and Tata Motors led the fight back in Auto stocks as a pause in interest rate increase indicates vehicles would be available at lower interest rates. Tata Motors rose by over 3.5% to Rs749, Maruti added 2.2% to close at 796 and M7M raced ahead by adding 2.4% to Rs762.
Pharma stocks were a mixed bag as Cipla proved to be a major laggard for the Pharma index. The scrip plunged sharply after its Q4 profit fell by 34% to Rs1.26bn on lower earnings from the export of drug-ingredients and operations other than health-care. While Ranbaxy was among the star performers over the week after the company received U.S. approval to sell a generic version of Bristol-Myers Squibb Co.'s Pravachol cholesterol lowering drug with exclusive marketing rights. The scrip added over 7% to close at Rs370.7 and Divis Labs added 2% to end at Rs3565. While STAR, Glenmark and Aurobindo Pharma were among the major losers bring the Pharma index down.
Tech stocks continued to slide lower after Rupee advanced for a fifth day on Thursday, extending a rally to the highest in almost nine years. Concerns regarding control of inflation have led to speculation that the RBI bank will allow the Indian currency to strengthen against the Dollar. Wipro fell by 1% to Rs566, TCS lost over 1.7% to Rs1234, Satyam Computer was down by 1.9% to Rs467 and Infosys lost by 2% to close the week at Rs2007.
May-hem...That sinking feeling again!
Bulls are again getting weary regarding the month of May as it reminds them of the sinking feeling again, which caught the market in a tailspin last year. Historically, markets have peaked in the month of May, thereby giving opportunity for investors to create short positions. In 2006, the month of May saw the Sensex hit record highs and quickly came crashing. With many major results out of the way, not much is in store for the bulls. Any negative news even from the global market could have a cascading effect.
The trend of the Rupee and metal prices would be watched closely. The Rupee is headed towards its biggest monthly gain since the last three decades. While the appreciation may not be bad for the economy as a whole, it certainly spells bad news for the export-centric sectors like IT, Textiles and Gems & Jewellery.Stay light especially on Monday and when markets open again on Thursday be strictly stock-specific
The market may remain sideways with negative bias, as traders may refrain from building fresh positions ahead of slew of holidays next week and due to subdued to weak trend in Asian markets. Next week is a curtailed trading week as the market remains closed for two days in a row on Tuesday (1 May) and Wednesday (2 May) on account of a public holiday.
Corporate results announced so far, have been strong. After trading hours on Thursday, Reliance Industries (RIL) reported Q4 results that beat market expectations. RIL reported 14% growth in net profit in Q4 March 2007 at Rs 2853 crore compared to Rs 2520 crore in Q4 March 2006, on the back of strong refining margins. The company said refining margins for the March 2007 quarter were $13 a barrel, higher than the benchmark Asian Dubai crack margin, which averaged less than $7 in the quarter.
The market wide rollover of April derivatives contracts to May contracts was around 70-72%, which is almost the same as was witnessed during the previous expiry but lower than the 12-month average. Many investors let their long positions expire as they do not expect the market to sustain its recent gains. Corporate results, FII inflow, RBI's pause on rate hike and firm global markets helped the Sensex gain 1773.51 points (14.2%) from a low of 12,455.37 on 2 April 2007. The Sensex had tanked 617 points in a single trading session on 2 April 2007, following the Reserve Bank of India (RBI)'s surprise hike in interest rates announced after trading hours on 30 March 2007.
The major March 2007 quarter results today are that of Bharti Airtel and Ranbaxy Laboratories.
The key economic data due today is the weekly inflation data. India's wholesale price inflation rate is forecast at 6.09% for the 12 months to 14 April 2007, unchanged from a week earlier. The data will be released around noon on Friday (27 April). The annual rate hit 6.69% on 27 January 2007, its highest in more than two years, but has moderated after the central bank tightened policy and the government cut duties on a range of items to rein in prices.
FIIs have pumped money heavily into Indian stocks, this month. Their inflow picked up after IT major Infosys on 13 April 2007, issued a strong guidance for FY 2008, putting to rest concerns of a US economic slowdown on the IT sector. FII inflow for April 2007 (till 25 April) reached Rs 6514.20 crore. FIIs had pulled out a net Rs 1082 crore in March 2007.
As per provisional data FIIs were net sellers to the tune of Rs 89 crore on Thursday (26 April). Domestic institutional investors were net sellers to the tune of Rs 178 crore on Thursday.
Asian stocks nudged lower on Friday (27 April) as caution prevailed ahead of first-quarter US economic growth numbers later this session. Key benchmark indices in Hong Kong, Japan, China, South Korea, Singapore and Taiwan were down by between 0.1% to 1.1%. US data later on Friday is expected to show that the world's biggest economy expanded at an annualised rate of 1.8 percent in the first quarter, slowing from a 2.5 percent pace in the fourth quarter of 2006.
US stocks gained on Thursday, as better-than-expected profits from such companies as 3M Co. and Exxon Mobil Corp. propelled the blue-chip Dow Jones Industrial Average to its second straight close above 13,000. The Dow finished up 15.61 points, or 0.12 percent, at 13,105.50. The Standard & Poor's 500 Index ended down 1.17 points, or 0.08 percent, at 1,494.25. The Nasdaq Composite Index closed up 6.57 points, or 0.26 percent, at 2,554.46.
London Brent crude, currently seen as most representative of global oil prices, was up 17 cents at $67.82, supported by a slew of refinery outages in the United States that have thinned gasoline stocks.
NIFTY (4177) SUP 4140 RES 4215
BUY WIPRO (563.65)
SL 658 T 573, 576
BUY SHIV-VANI (321.10)
SL 316 T 331, 334
SELL STAR (325.90)
@ 328 SL 332 T 317, 315
SELL GMRINFRA (408)
@ 410 SL 415 T 398, 394
SELL RELCAPITAL (731)
@ 734 SL 738 T 723, 720
Stay light, enjoy the weekend
Turbulence is life force. It is opportunity. Let's love turbulence and use it for change.
The turbulence in the latter half of the day was more or less expected. The bulls and bears may well adopt a wait and watch approach. Next week is a shortened week (Tuesday and Wednesday will be holidays) and investors would not like to carry any heavy positions over the weekend, given that Monday mornings quite often bring in the blues. Stay light and book profits in counters that have run up too fast.
The global cues are mixed. The Dow Jones Industrial Average made a new high, rising by 0.1% while the Nasdaq gained 0.2%. Most Asian markets are in the red this morning. Japan has led the decline in regional stocks as a higher than forecast fall in consumer prices coupled with a surprising drop in industrial production fueled concerns about the world's second-largest economy. Sliding metals prices dragged mining shares lower in the region. Crude oil remains above $65 per barrel. The rollover in the F&O segment has been good, though reports suggest squaring up of some long positions for the April contracts and creation of some short positions in the May contracts. What's more, May Nifty futures yesterday ended at a discount of 15 points to the Spot Nifty.
Reliance Industries announced its results after the market closed for trading. As has been the trend in the past couple of quarters, this time too better than expected show by its refining business has managed to offset a subdued performance from the petrochemicals business. Going forward, the trend will continue to be similar for RIL, with major upsides likely from FY09 once the company kicks off the sale of gas from the KG Basin. The full effect of the new refinery being set up by RPL will kick in from FY10. What will be the contribution from the retail business is still unclear at the moment as the business is still at a nascent stage. The stock has already run up quite a bit in recent times along with the market. So, one may not see a big movement on the upside from RIL today.
FIIs were net sellers to the tune of Rs890.4mn (provisional) in the cash segment yesterday while the domestic institutions offloaded shares worth Rs1.78bn. In the F&O segment, FIIs were net buyers of Rs5.6bn yesterday. On Wednesday, FIIs were net buyers of Rs9.62bn, taking their net buying in April to $1288.6mn. Year-to-date, the net inflows from the foreign funds is now close to $3bn. Mutual Funds pumped in Rs2.59bn in the cash segment on Wednesday.
With the rupee rising past 41 against the dollar, the Indian economy has crossed the $1 trillion mark. But, Moody's says that India needs to boost productivity to meet demand and check inflation.
SEBI has barred five traders and two brokerages for alleged price manipulation in the shares of recent new listings such as Mindtree, Shree Asthavinayak Cinevision, Pyramid Saimira, Pochiraju Industries, Cambridge Technologies and Al Champdany.
US stocks gained on Thursday with the Dow Jones Industrial Average closing at a record high for the second day in a row on the back of upbeat earnings from 3M, Apple and others.
The S&P 500 Index closed flat at 1494.25. The Dow, which closed above 13,000 for the first time on Wednesday, added 15.61 points to 13,105.50. The Nasdaq Composite Index rose 6.57 points to 2554.46, supported by a rally in Apple to a record.
After the close, software giant Microsoft reported higher quarterly sales and earnings that topped estimates. The company's shares gained 5% in extended-hours trading. Microsoft should give the broader market a lift Friday morning. However, any advance could be challenged by the first-quarter GDP report, due out before the start of trading.
US light crude oil for June delivery dropped 78 cents to $65.06 a barrel on the New York Mercantile Exchange. The front-month contract was quoting 23 cents higher at $65.29 per barrel in after-hours trading in Asia.
Treasury prices slumped, raising the yield on the 10-year note to 4.69% from 4.64% late on Wednesday. In currency trading, the dollar gained against the euro and yen, rebounding after several down sessions. The greenback's strength dragged on dollar-denominated assets like gold and silver. COMEX gold for June delivery fell $9.40 to settle at $678 an ounce.
European stocks hit new six-and-half-year highs. The pan-European Dow Jones Stoxx 600 index rose 0.15% to trade at 388.40. The German DAX Xetra 30 rose 0.6% to 7,387.02 while the French CAC 40 closed just in the red at 5,944.44. The UK's FTSE 100 advanced 0.1% to 6,469.40.
Stocks in Brazil and Mexico fell on profit-taking and slipping commodity prices. In Brazil, the benchmark Ibovespa stocks index closed 608 points, or 1.2%, lower at 49,067.69, down from Wednesday's record-high close at 49,676. Mexico's stocks closed lower for a fourth consecutive session. The IPC index of 35 most-traded issues fell 101 points, or 0.3%, to 29,342.70.
Asian stocks fell this morning. The Nikkei in Tokyo was down 69 points to 17,360 while the Hang Seng in Hong Kong slumped 164 points to 20,502. The Kospi in Seoul slid 14 points to 1538 and the Straits Times in Singapore dropped 25 points to 3381.HOW MARKET FARED
Global cues to dictate trend
With over 8% gains in last two weeks, the bulls slowed down today after a spectacular opening buoyed by strong global markets. However, bulls succumbed to profit taking at peaks, dragging the indices in negative territory in afternoon trades. Finally, after alternate bouts of buying & selling, NSE Nifty closed at 4177.85, adding 11 points to its previous close. While BSE 30-share Sensex added 11 points to end at 14229 after touching an intra-day peak of 14383.72 and a low of 14127.18.
HPCL, Bajaj Auto, BPCL, HLL and Tata Motors were the major gainers among the Nifty 50 stocks. While, HCL and Tisco were among the notable losers.
Earlier, indices opened higher with a huge gap taking cues from strong US market overnight with Dow Jones hitting an all-time high of 13,107, before closing at a record 13,090, up 136 points. Nasdaq added 23 points to close at 2548. Among the Indian ADRs HDFC Bank rose nearly 3% to $74.92 while ICICI Bank added 2.6% to close at $46.52. VSNL, Infosys, Satyam, Wipro and Dr.Reddy's gained between 1-2% each to $21.47, $53.59, $25.38, $16.49 and $17.40, respectively.
ABB added over 1.9% to Rs4096 after the company announced strong sets of Q1 numbers with net profit at Rs866mn (up 68.8%) and net sales at Rs13.12bn (up 63%).
Cement stocks advanced further for second trading session. India Cement was up by 2% to Rs184 and Grasim was up by over 2% to Rs2509 after the company announced impressive Q4 results with profit up 80% to Rs4.74bn, sales up 36% to Rs24.94bn.
Tech stocks closed lower after Rupee climbed for a fifth day on speculation that RBI will allow the currency to strengthen to curb inflation. Income from US constitutes around 60% for the tech companies. Rupee touched a high of 40.87 against the Dollar. Frontline stock Infosys closed flat at Rs2019, HCL Tech fell by over 2% to Rs326 and Satyam Computer was down by over 1% to Rs461.
Profit booking was seen in Real Estate and Property stocks after rallying in last two trading sessions. Parsvnath lost by over 3% to Rs326, Sobha Developers declined by over 3% to Rs889 and Nagarjuna Construction was down by 2% to Rs180.
BEML: Rakesh Jhunjhunwala on 23rd April 2007, sold 122833 & 177167 equity shares in market of BEML. Total Holding of Rakesh Jhunjhunwala and persons acting in concert after sale is 2,11,750 shares which is 0.576%.
The turnover on NSE was up by 7% to Rs118bn. BSE Capital Good index was the major gainer and gained 0.91%. BSE Auto index (up 0.75%), BSE Bank index (up 0.27%) and BSE PSU index (up 0.52%) were among the other major gainers. However, BSE Consumer Durable index lost 0.90%.
IFCI, TTML, Nagarjuna Fertilizers, Tele Data Info, IDFC, RNRL, RPL, IBREAL, SAIL, ITC, Idea, RIL, Vijaya Bank, Ashok Leyland, NTPC, IVRCL Infra, Hindalco, Arvind Mills and PFC.
Tanla, Swan Mills, Mirza Intern, Sujana Metal and Saregama.
Aptech, Bharti Airtel, Cairn India, CRISIL, Educomp, Era Constructions, Esab India, HCL Info, HCC, Jubilant Organosys and Ranbaxy.
Bajaj Auto, Bank of India, Bharat Forge, BHEL, BPCL, Grasim Industries, HLL, HPCL, I-Flex, PNB, Ranbaxy and Siemens.
Wipro, Sterling Biotech, National Aluminium Company Ltd, Godrej Consumer Products Ltd, VSNL, APIL, Crompton Greaves, Moser Baer, SRF, HCL Technologies and GlaxoSmithkline.
Stock Futures with Largest Increases in OI:
BILT, Guj Alkalies, Dr Reddy's Labs, Ultratech cement, Mangalore Refinery, OBC, Indian Hotels, i-Flex and Amtek Auto.
Stock Futures with Largest Decreases in OI:
Patni, Guj Narmada Valley, Aurobindo Pharma, BEL, Corp Bank, HPCL, IOC, Bombay Dyeing, Polaris and STAR.
RIL Q4 net income (up 14%) to Rs28.5bn and sales (up 5.5%) to Rs258.95bn
Balrampur Chini Q2 profit at Rs199.7mn (down 74.8%), sales at Rs3.96bn (up 19%)
Nicholas Piramal Q4 group profit at Rs560.3mn ( 257%), net sales at Rs6.45bn (up 51.7%)
ABB Q1 net profit at Rs866mn (up 68.8%), net sales at Rs13.12bn (up 63%)
Marico Q4 profit (up 17%) to Rs281.2mn and sales (up 33%) to Rs3.97bn
Wockhardt Q1 profit rises to Rs663mn from a loss of Rs37mn, revenues (up 48%) to Rs5.25bn
IDEA – Buy from CLSA with target of Rs126
Long Term investment:
Major News Headlines
Moody's says classic signs of overheating in India; must boost production to curb overheating
Liberty Shoes plans to raise funds by selling securities
Ranbaxy gets final USFDA approval to manufacture & market Zolpidem Tablets
Dr Reddy's signs pact with Alchemia for Herapin - Reports
Opto Circuits to buy Devon Innovations and Ormed Chemical
Tata Tea buys Vitax & Flosana Trademarks in Poland
Hindalco bids for majority stake in Bosnian Smelter - Reports.