Key benchmark indices moved in a narrow range in positive terrain in afternoon trade after Railway Minister Mallikarjun Kharge kept passenger fares and freight rates unchanged in the Interim Railway Budget for the first four months of the 2014/15 presented in the Lok Sabha today, 12 February 2014 and said that investment in railways is being stepped up by partnership with the private sector and that a proposal is under consideration of the government to enable Foreign Direct Investment (FDI) to foster creation of world class rail infrastructure. The barometer index, the S&P BSE Sensex, was up 117.45 points or 0.58%, up about 51 points from the day's low and off close to 36 points from the day's high. The market breadth, indicating the overall health of the market, was positive. Gains in Asian stocks and overnight rally in US stocks underpinned sentiment on the domestic bourses.
J B Chemicals & Pharmaceuticals dropped after weak Q3 outcome. Orchid Chemicals & Pharmaceuticals jumped as net loss narrowed in December 2013 quarter. Shares of companies whose fortunes are linked to orders from Indian Railways were mixed after Rail minister Mallikarjun Kharge said at the time of presenting the Interim Railway Budget for the first four months of the 2014/15 in Lok Sabha that investment in railways is being stepped up by partnership with the private sector and that a proposal is under consideration of the government to enable Foreign Direct Investment (FDI) to foster creation of world class rail infrastructure.
The market edged higher in early trade on firm Asian stocks. The Sensex extended initial gains and hit fresh intraday high in morning trade. The Sensex hit its highest level in more than 1-1/2 weeks. The 50-unit CNX Nifty scaled two-week high. Key benchmark indices moved in a narrow range in positive terrain in afternoon trade after Railway Minister Mallikarjun Kharge kept passenger fares and freight rates unchanged in the Interim Railway Budget for the first four months of the 2014/15 presented in the Lok Sabha today, 12 February 2014 and said that investment in railways is being stepped up by partnership with the private sector and that a proposal is under consideration of the government to enable Foreign Direct Investment (FDI) to foster creation of world class rail infrastructure.
Asian shares edged higher on Wednesday, 12 February 2014, as upbeat trade data from China and an optimistic economic outlook from Federal Reserve Chair Janet Yellen whetted investors' appetite for risk.
At 13:15 IST, the S&P BSE Sensex was up 117.45 points or 0.58% to 20,480.82. The index jumped 153.23 points at the day's high of 20,516.60 in mid-morning trade, its highest level since 31 January 2014. The index rose 66.46 points at the day's low of 20,429.83 in morning trade.
The CNX Nifty was up 32.40 points or 0.53% to 6,095.10. The index hit a high of 6,106.60 in intraday trade, its highest level since 29 January 2014. The index hit a low of 6,080.35 in intraday trade.
The BSE Mid-Cap index was up 18.89 points or 0.30% at 6,376.46. The BSE Small-Cap index was up 21.88 points or 0.34% at 6,368.41. Both these indices underperformed the Sensex.
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The market breadth, indicating the overall health of the market, was positive. On BSE, 1,240 shares rose and 1,126 shares fell. A total of 153 shares were unchanged.
Among the 30-share Sensex pack, 19 stocks rose and rest fell. GAIL (India) (up 2.37%), ONGC (up 2.25%), ICICI Bank (up 2.04%), Reliance Industries (up 1.69%), Bhel (up 1.58%), HDFC (up 1.26%), Sun Pharmaceutical Industries (up 1.13%), State Bank of India (up 1.10%) and Larsen & Toubro (up 1.08%), edged higher from the Sensex pack.
Tata Steel (down 3.11%), Sesa Sterlite (down 1.35%), Dr. Reddy's Laboratories (down 1.24%), Maruti Suzuki India (down 1%), Hindalco Industries (down 0.96%), Coal India (down 0.91%), NTPC (down 0.87%), Cipla (down 0.85%), ITC (down 0.74%) and Tata Power (down 0.13%), edged lower from the Sensex pack.
Orchid Chemicals & Pharmaceuticals (Orchid) was locked at 5% upper circuit at Rs 45.15 after the company reported a reduced net loss in the quarter ended 31 December 2013 over the quarter ended 31 December 2012. The result was announced after market hours on Tuesday, 11 February 2014.
Orchid reported a net loss of Rs 53.90 crore in the quarter ended 31 December 2013, lower than net loss of Rs 72.36 crore in the quarter ended 31 December 2012. Orchid's revenue rose 19% to Rs 371.60 crore in the quarter ended 31 December 2013 over the quarter ended 31 December 2012. EBITDA surged 368.9% to Rs 109.49 crore in the quarter ended 31 December 2013 over the quarter ended 31 December 2012.
Orchid had extended its last financial year (FY) 2012-13 by six months to 30 September 2013. Consequently, the current FY 2013-14 will consist of only six months i.e. from 1 October 2013 to 31 March 2014.
Commenting on the company's financial performance, Mr K Raghavendra Rao, CMD, Orchid said, "Though the company continues to face tight working capital situation, the approval for the Corporate Debt Restructuring Package (CDR), expected before end of February 2014 would facilitate completion of Pencillin and Carbapenem Business Transfer to Hospira and also bring in working capital availability from deal proceeds besides deleveraging debt profile. With this the company would be on a better platform to achieve improved performance in the quarters to come".
JB Chemicals & Pharmaceuticals (JBCPL) lost 2.23% to Rs 127.05 after the company reported net loss of Rs 6.47 crore in Q3 December 2013 as compared to net profit of Rs 21.87 crore in Q3 December 2012. Net sales rose 17.25% to Rs 234.22 crore in Q3 December 2013 over Q3 December 2012. The Q3 result was announced after trading hours on Tuesday, 11 February 2014.
JBCPL's net profit in Q3 December 2013 was hit mainly on account of an exceptional item of one-time loss of Rs 64.50 crore due to revision of sale price of Russia-CIS OTC business undertaking. Profit after tax without exceptional/non-recurring items rose 38.18% to Rs 30.22 crore in Q3 December 2013 over Q3 December 2012.
Ambuja Cements lost 0.9% at Rs 159.45 as the stock turned ex-dividend today, 12 February 2014, for final dividend of Rs 2.20 per share for the year ended 31 December 2013. Before turning ex-dividend, the stock offered a dividend yield of 1.36% based on the closing price of Rs 160.90 on Tuesday, 11 February 2014.
Shares of companies whose fortunes are linked to orders from Indian Railways were mixed after Rail minister Mallikarjun Kharge said at the time of presenting the Interim Railway Budget for the first four months of the 2014/15 in Lok Sabha that investment in railways is being stepped up by partnership with the private sector and that a proposal is under consideration of the government to enable Foreign Direct Investment (FDI) to foster creation of world class rail infrastructure. Transformers & Rectifiers India (down 0.67%), Texmaco (down 1.14%), Titagarh Wagons (down 2.28%), Kalindee Rail Nirman (Engineers) (down 3.84%), Kernex Microsystems (India) (down 4.85%) and Hind Rectifiers (down 6.25%), edged lower.
Zicom Electronic Security Systems (up 2.18%), NELCO (up 1.44%), Bhel (up 1.42%), Simplex Casting (up 1.39%), Stone India (up 0.57%), BEML (up 0.20%) and Container Corporation of India (up 0.08%), edged higher.
No increase in rail fare and freight has been proposed in the interim Rail Budget for the year ending March 2015. Presenting the Budget in Parliament today, the Minister of Railways Mallikarjun Kharge announced 72 new trains, extension of three trains and increase in frequency of three trains. The Budget presented today envisaged investment of Rs 64305 crore as against revised estimates for the year ending March 2014 of Rs 59359 crore. Anticipating a healthier growth of economy, the freight traffic target is proposed at 1,101 million tonnes, an increment of 49.7 million tonnes over the current years' revised target of about 1052 million tonnes. The Gross Traffic Receipts have been projected at Rs 160775 crore. Working Expenses have been proposed at Rs 110649 crore, which is Rs 13589 crore higher than the Revised Estimates for the current year.
Railways Minister said given the promising trend of loading, the target has been scaled up to about 1052 million tonnes from the budget target of 1047 million tonnes and freight earnings targets revised to Rs 94000 crore. He announced that an independent Rail Tariff Authority is being set-up to advise the Government on fixing of fares and freight.
Briefing about Railways efforts for moderation of its network Mr. Kharge said a joint Feasibility Study for Mumbai-Ahmedabad High Speed corridor, started in December 2013, will be completed in 18 months. Besides the High Speed project, Indian Railways also intend to explore low cost options for raising speeds to 160-200 kmph on existing select routes like Delhi-Agra and Delhi-Chandigarh.
The Minister said that Investment in Railways is being stepped up by partnership with the private sector. PPP projects related to rolling stock manufacturing units, modernisation of railway stations, multi-functional complexes, logistics parks, private freight terminal, freight train operations, liberalised wagon investment schemes and Dedicated Freight Corridors are in the pipeline. Apart from attracting private investments from domestic investors in rail sector, a proposal is under consideration of the Government to enable Foreign Direct Investment (FDI) to foster creation of world class rail infrastructure.
In a path breaking decision, an independent Rail Tariff Authority is being set-up to advise the government on fixing of fares and freight of railways, Mr. Kharge said. The Rail Tariff Authority will not only consider the requirements of the railways but also engage with all stake-holders to usher in a new pricing regime through a transparent process. This would lead to an era of rationalisation of fares and freight structures for improving the fare-freight ratio and gradually bringing down cross subsidization between different segments. It is expected that this would go a long way towards improving the financial health of the Railways, lead to growth to match expectations of the nation and provide stability by minimizing volatility of revenue streams, Mr. Kharge said.
The full-fledged Railway Budget for 2014/15 will be presented by the new government which comes to power after the Lok Sabha polls in April-May 2014.
In the foreign exchange market, the rupee edged higher against the dollar on global risk-on sentiment. The partially convertible rupee was hovering at 62.15, higher than its close of 62.22/23 on Tuesday, 11 February 2014.
Finance Minister P Chidambaram will present the Vote-on-Account or interim budget on 17 February 2014. The objective of a Vote-on-Account is to get Parliament's nod for expenditure to be incurred in the months prior to elections. The next full-fledged budget will be presented by the new government which comes to power after the Lok Sabha polls in April-May 2014.
Consumer price inflation is seen easing a bit in January 2014. Inflation based on the combined consumer price index (CPI) for urban and rural India is seen easing to 9.4% in January 2014 from 9.87% in December 2013, as per the median estimate of a poll of economists carried out by Capital Market. The government will unveil data on inflation based on the combined consumer price index (CPI) for urban and rural India for January 2014 at 17:30 IST today, 12 February 2014.
Inflation based on the wholesale price index (WPI) is also expected to ease in January 2014. WPI inflation is seen easing to 5.9% in January 2014 from 6.16% in December 2013, as per the median estimate of a poll of economists carried out by Capital Market. The government will unveil data on inflation based on the wholesale price index (WPI) for January 2014 at 12 noon on Friday, 14 February 2014.
Industrial production is expected to remain in contraction mode in December 2013. Industrial output is expected to decline 1% in December 2013, as per the median estimate of a poll of economists carried out by Capital Market. India's industrial production declined 2.1% in November 2013, recording decline for second consecutive month after 1.6% dip in October 2013. The data will be announced at 17:30 IST today, 12 February 2014.
The Reserve Bank of India next undertakes monetary policy review on 1 April 2014. Sighting elevated consumer price inflation, the Reserve Bank of India raised its key lending rates by 25 basis points after Third Quarter Review of Monetary Policy for 2013-14 on 28 January 2014.
Asian shares edged higher on Wednesday, 12 February 2014, as upbeat trade data from China and an optimistic economic outlook from Federal Reserve Chair Janet Yellen whetted investors' appetite for risk. Key benchmark indices in China, Japan, South Korea, Singapore, Indonesia, Hong Kong and Taiwan were up 0.20% to 1.50%.
Chinese exports jumped 10.6% in January from a year earlier, eclipsing an estimate for a 0.1% gain, while imports rose 10% and the country's trade surplus widened to $31.86 billion.
Trading in US index futures indicated that the Dow could advance 24 points at the opening bell on Wednesday, 12 February 2014. US stocks surged on Tuesday as Federal Reserve Chairwoman Janet Yellen pledged to keep interest rates low and to continue to taper the pace of bond purchases if the economy keeps improving. US economic growth has picked up and the Federal Reserve will continue to scale back stimulus in "measured steps", Yellen said. Yellen said the Fed will continue to follow its low-interest-rate policy course during a hearing before the House Financial Services Committee. "Let me emphasize that I expect a great deal of continuity in the Federal Open Market Committee's approach to monetary policy," she said. "I am committed to achieving both parts of our dual mandate: helping the economy return to full employment and returning inflation to 2% while ensuring that it does not run persistently above or below that level," she said.
Yellen will testify before the Senate Banking Committee tomorrow, 13 February 2014.
The Federal Open Market Committee (FOMC) next undertakes monetary policy review on 18-19 March 2014. After a monetary policy review, the FOMC on 29 January 2014 announced it will reduce monthly bond purchases by another $10 billion to $65 billion. The Fed also signaled that it is likely to keep reducing bond purchases in the coming months, citing a pickup in US economic activity and improvement in the US labor market.
The House of Representatives voted on Tuesday, 12 February 2014, to suspend the US debt limit until March 2015, giving a win to President Barack Obama and Democrats in Congress who insisted that the ceiling be lifted without conditions.
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