Tuesday, September 18, 2012
Tech Mahindra announced the acquisition of 51% stake in mobile value-added services provider Comviva Technologies, a Bharti Group company, for ~Rs2.6bn. (ET) Tata Motors Ltd’s global vehicle sales, including that of subsidiary Jaguar Land Rover, rose 13% in August from a year earlier. The company sold 97,225 units during the month. (BS) Reliance Industries Ltd has sought tripling of its KG-D6 gas price from April 1, 2014 after the current below market rate of $4.205 per mmBtu expires. (BL) Reliance Power said its 4,000-MW Sasan ultra mega power project in Madhya Pradesh has been connected to the national grid. (BL) An official panel has recommended that the government should penalise Tata Power and Hindalco Industries for delay in developing a coal block in Jharkhand. (ET)
The wave of reforms sweeping over the weekend saw the indices take off to a glorious start. The Sensex and Nifty reached 14-month highs and extended its winning streak for over a week now. The gains were pared soon with FMCG and tech stocks being the victims. The RBI announced a reduction in CRR by 25bps. RBI also kept the policy repo rate under the liquidity adjustment facility (LAF) unchanged at 8.0%. Consequently, the reverse repo rate under the LAF will remain unchanged at 7.0%, and the marginal standing facility (MSF) rate and the Bank Rate at 9.0%. "After an unexpected 100bps SLR reduction during the June quarter review, the RBI once again surprised the market by cutting the CRR rate by 25bps to 4.5%. Although commercial bank’s borrowing from the central bank under the LAF window has been benign in recent months, the RBI may be anticipating some pressure on liquidity in the coming months due to the advance tax outflows and a seasonal uptick in credit growth.
"Now and then it's good to pause in our pursuit of happiness and just be happy." - Guillaume Apollinaire It’s been raining gains and good news all around. The Sensex has gained ~ 20% this year and has perched itself to a 14-month high. Brokerages are rushing to raise Sensex targets anything between 19K and 23K. It’s a holiday truncated week and we could see some profits being booked today. Future sustenance of any rally will depend on broader participation from mid caps and small caps with 5450 emerging as new line of defense.
The opening on the Dalal Street is expected to be on a flat note tracking mixed global cues. SGX Nifty is trading 12.50 points higher. Events for the day: Ex date for final dividend of Bhushan Steel, Hindustan Copper. Headlines for the day: Unitech to reply to Telenor's plea of Rs6,400 cr indemnity. Foreign telcos will get 3 months to form Indian venture. Tata Motors launches six commercial vehicles. Welspun Corp raises Rs252 cr through debentures. Indian Indices: Today, the opening on the Dalal Street will be on a flat note led by mixed global peers. SGX Nifty is also trading 12.50 points higher. Yesterday (September 17, 2012), the Reserve Bank of India (RBI) slashed the cash reserve ratio (CRR) by 25 basis points to 4.50% from 4.75%. The policy repo rate and the reverse repo rate were kept unchanged at 8% and 7% respectively. Thejo Engineering is the first company that will list its equity shares on the National Stock Exchange (NSE) EMERGE SME platform today. The issue price is fixed at lower end of price band of Rs402-430 a share. On Monday (September 17, 2012), the Sensex settled at 18542, up by 78 points while the Nifty closed at 5610, rising by 32 points.
Trading of S&P CNX Nifty futures on the Singapore stock exchange indicates that the Nifty could gain 8.50 points at the opening bell. Soon after the government's announcement of foreign direct investment (FDI) in multi-brand retail Trinamool Congress (TC) chief Mamata Banerjee had set a 72-hour deadline for the government to rollback its decisions on diesel price hike and cutting supply of subsidised LPG cylinders and FDI in multi-brand retail. A meeting of the parliamentary partly of Trinamool Congress is scheduled today, 18 September 2012, to discuss the issue. Bhushan Steel turns ex-dividend today, 18 September 2012, for dividend of 50 paise per share for the year ended 31 March 2012 (FY 2012). Hindustan Copper turns ex-dividend today, 18 September 2012, for dividend of Rs 1 per share for FY 2012. Jaiprakash Associates turns ex-dividend today, 18 September 2012, for final dividend of 50 paise per share for FY 2012. Jaypee Infratech turns ex-dividend today, 18 September 2012, for final dividend of 50 paise per share for FY 2012.