Though the markets were flat in the first half of the week, and started gaining from Wednesday, driven by favourable international markets and the US Federal Reserve's decision to not raise interest rates. | |
| The domestic cue such as a drop in inflation rate at 4.03 per cent as compared with 4.28 per cent in previous week and positive monsoon outlook fuelled the rally further. The Sensex gained 1.01 per cent during the week. |
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| Banking and cement stocks were the key driver of the rally. Cement stocks and sugar stocks too joined in. |
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| What to expect this week |
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| As this is the last week before technology companies Q1 FY08 results will start flowing, market participants expect markets to remain flat to positive. |
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| Depending on the international cues, the overall sentiment remains positive especially on cement, banking and sugar stocks. |
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| The market is also positive on mid-cap stocks as most of the capacity addition announced last year will start reflecting in this year's bottom line. |
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| FIIs have been net sellers to the tune of Rs 1,211 crore over the last three trading sessions. Going forward investors need to carefully watch FII data as well. |
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| Stock to watch | JBF Industries | | Last week's close (Rs) | 29.30 | | Prev. week's close (Rs) | 27.30 | | Week's high (Rs) | 36.05 | | Week's low (Rs) | 27.00 | | Last week's ave. daily turnover (Rs cr) | 3.20 | | Prev. week's ave. daily turnover (Rs cr) | 0.38 | | Number of up/down move | 2/3 |
Investors are lapping up the Kajaria Ceramics stocks taking advantage of its underperformance over the past six to twelve months. The stock trades at a trailing twelve-month P/E of 10 times ending December 2006. The concerns of cheap imports have kept tile manufacturers' stocks low. Though the company has reported consistent growth of over 20 per cent in net sales, profitability has lagged behind. Kajaria is the largest manufacturer of ceramic floor and wall tiles in the country. It offers indigenously manufactured tiles in the price range of Rs 20-40 per sq ft and the imported ones from China, Italy and Spain between Rs 70 and Rs 250 per sq ft. The company is setting up a manufacturing unit in Gujarat next year with an initial investment of about Rs 100 crore. The Kajaria Group is also set to open 10 showrooms, known as Kajaria World, for its imported tiles business by 2009. |
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