A bout of volatility was witnessed as key benchmark indices recovered from lower level after giving away almost entire initial gains in morning trade. The barometer index, the S&P BSE Sensex, was currently trading below the psychological 21,000 mark, after moving past that level in early trade. The Sensex was up 55.65 points or 0.27%, up about 45 points from the day's low and off close to 55 points from the day's high. The market breadth, indicating the overall health of the market, was strong.
Index heavyweight Reliance Industries (RIL) edged lower in volatile trade. Realty stocks extended Tuesday's gains as the Reserve Bank of India (RBI) after a monetary policy review on Tuesday, 29 October 2013, raised its main lending rate viz. the repo rate by 25 basis points as expected. Purchases of both residential and commercial property are largely driven by finance. Tata Communications surged after the company reported turnaround Q2 result. Shares of cellular services major Bharti Airtel edged higher, with the stock shrugging off the company's weak Q2 results.
The market edged higher in early trade as Asian stocks rose on speculation Federal Reserve policy makers won't announce any major changes to monetary stimulus for the US economy when they conclude a meeting today, 30 October 2013. The 50-unit CNX Nifty hit its highest level in more than 35 months. A bout of volatility was witnessed as key benchmark indices recovered from lower level after giving away almost entire initial gains in morning trade.
The market sentiment was boosted by data showing that foreign funds made substantial purchases of Indian stocks on Tuesday, 29 October 2013. Foreign institutional investors (FIIs) bought shares worth a net Rs 1103.04 crore on Tuesday, 29 October 2013, as per provisional data from the stock exchanges.
The market may remain volatile in the immediate future as traders roll over positions in the futures & options (F&O) segment from the near month October 2013 series to November 2013 series. The near month October 2013 derivatives contract expire tomorrow, 31 October 2013.
At 10:20 IST, the S&P BSE Sensex was up 55.65 points or 0.27% to 20,984.65. The index jumped 108.58 points at the day's high of 21,037.59 in early trade, its highest level since 24 October 2013. The index rose 8.11 points at the day's low of 20,937.12 in morning trade.
The CNX Nifty was up 16.45 points or 0.26% to 6,237.35. The index hit a high of 6,253.65 in intraday trade, its highest level since 11 November 2010. The index hit a low of 6,222.60 in intraday trade.
The market breadth, indicating the overall health of the market, was strong. On BSE, 996 shares rose and 656 shares fell. A total of 95 shares were unchanged.
Among the 30-share Sensex pack, 15 stocks rose and rest of them fell. Bhel (up 2.31%), Dr Reddy's Laboratories (up 1.78%) and ICICI Bank (up 1.35%), gained.
Index heavyweight Reliance Industries (RIL) dropped in volatile trade. The stock was off 0.09% at Rs 896. The stock hit high of Rs 902.50 and low of Rs 895.55 so far during the day.
Realty stocks extended Tuesday's gains as the Reserve Bank of India (RBI) after a monetary policy review on Tuesday, 29 October 2013, raised its main lending rate viz. the repo rate by 25 basis points as expected. Purchases of both residential and commercial property are largely driven by finance. D B Realty (up 2.29%) and Sobha Developers (up 0.83%) gained. But, Unitech fell 0.29%.
DLF rose 3.37% ahead of its Q2 result today, 30 October 2013.
Bharti Airtel rose 3.77% after reporting Q2 result. The company's consolidated net profit declined 29% to Rs 512 crore on 9.9% increase in total revenue to Rs 21324 crore in Q2 September 2013 over Q2 September 2012. The company announced the result during market hours.
Bharti Airtel's consolidated EBITDA (earnings before interest, taxation, depreciation and amortization) jumped 15.1% to Rs 6832 crore in Q2 September 2013 over Q2 September 2012. EBITDA margin increased to 32% in Q2 September 2013 from 30.6% in Q2 September 2012.
The company said its mobile internet revenues grew more than 100% to Rs 1503 crore in Q2 September 2013 over Q2 September 2012 (year-on-year), accounting for 39.1% of the overall incremental revenue. Revenues were also enhanced by strong growths of 28.8% in Digital TV, 20.8% in airtel business (B2B), and 54.4% in South Asia.
Mobile voice realisation in India improved by 1.31 paise on a year-on-year (Y-o-Y) basis (36.74 paise in Q2 September 2013 vs 35.43 paise in Q2 September 2012), together with an increase in voice usage per customer by 20 minutes per month (up from 417 minutes in Q2 September 2012 to 437 minutes per subscriber in Q2 September 2013). Data usage per customer has gone up by 98 megabytes (MBs) (from 133 MBs in Q2 September 2012 to 231 MBs per customer in Q2 September 2013). Consequently, ARPU has moved up by Rs 15 to Rs 192 in Q2 September 2013.
International revenues grew by 17.9% Y-o-Y and 18.3% quarter-on-quarter (Q-o-Q) in rupee terms with Africa growing by 16.1% Y-o-Y & 18.5% Q-o-Q while South Asia grew by 54.4% Y-o-Y and 16% Q-o-Q. Africa revenue in constant dollar terms grew by 5.4% on sequential quarter basis led by a strong 28.2% increase in data revenues.
Mobile voice pricing in Africa remained stable at 3.30 cents per minute. Net revenue in Africa (after interconnect costs and cost of goods sold) has grown by 20.7% Y-o-Y in rupee terms.
Consolidated EBITDA (earnings before interest, taxation, depreciation and amortization) grew by 15.1% Y-o-Y at Rs 6832 crore with margin expanding to 32% from 30.6% in the corresponding quarter last year, driven by India EBITDA margin improvement from 32.6% to 34.8%.
The much improved operational performance is reflected in earnings before interest and taxes (EBIT) of Rs 2893 crore, representing a 28.7% Y-o-Y growth and 2% EBIT margin improvement.
The continued depreciation of the Indian Rupee has resulted in forex restatement and derivative losses of Rs 342 crore (vs. Rs 25 crore loss for Q2 September 2012). Consequently, the consolidated net income came in at Rs 512 crore, as against Rs 721 crore in the corresponding quarter last year. Consolidated Operating Free Cash Flows for the quarter were at Rs 4693 crore, reflecting a robust growth of 117.1% Y-o-Y.
The company's consolidated net debt has reduced to $9697 million resulting in the net debt to EBITDA ratio (USD terms) improving to 2.18 times as compared to 2.59 times at the end of the same quarter last year.
In a statement, Mr. Sunil Bharti Mittal, Chairman, Bharti Airtel, said: "Mobile internet is now a major engine of growth for Airtel across all geographies. Our sustained investment in this segment will further enhance customer experience and seamless coverage. The revenue growth in Africa reflects the inherent potential in the world's most promising continent. I am also pleased to see the evolution of Airtel Money into a significant service in geographies which are relatively under-banked."
Tata Communications surged 9.17% after the company reported turnaround Q2 September 2013 result. The company reported consolidated net profit of Rs 80.36 crore in Q2 September 2013 compared with net loss of Rs 274.24 crore in Q2 September 2012. The result was announced after market hours on Tuesday, 29 October 2013.
Tata Communications' consolidated net sales rose 16% to Rs 4952.61 crore in Q2 September 2013 over Q2 September 2012.
The company said growth in Q2 September 2013 was mainly attributed to the global increase in demand across all segments. Tata Communications' wholesale voice business continues to outpace the global market growth rate. Revenues from enterprises increased by 29% year-on-year (YoY). Operating income and margin were positively impacted by Tata Communications' continued focus on cost-management.
Gross revenues for the core business improved by 17% at Rs 4418.70 crore in Q2 September 2013 over Q2 September 2012.
Global Voice Services (GVS) continued on its growth path with a total of 15.4 billion minutes carried on the network in Q2 September 2013, up from 15.2 billion minutes in Q2 September 2012. GVS net revenues showed a 30% improvement in Q2 September 2013 over Q2 September 2012. Gross revenues for Global Data Services (GDS) also saw an upswing with a revenue growth of 19% at Rs 1989.70 crore in Q2 September 2013 over Q2 September 2012.
The start-up business, comprising primarily of Neotel, witnessed a 10% rise in revenues at Rs 533.90 crore in Q2 September 2013 over Q2 September 2012. The start-up business' EBITDA margins stood at 24.9% in Q2 September 2013 against 10.6% in Q2 September 2012. In local currency (ZAR) terms, Neotel's Q2 FY14 revenues improved by 18% YoY.
In the foreign exchange market, the rupee edged as dollar rose against a basket of major currencies as investors further trimmed bearish dollar positions ahead of the outcome of the Federal Reserve policy meeting later in the global day. The partially convertible rupee was hovering at 61.50, compared with its close of 61.31/32 on Tuesday, 29 October 2013.
Asian stocks rose on Wednesday, 30 October 2013, amid rising company earnings and with the Federal Reserve projected to maintain the pace of its monetary stimulus today. Key benchmark indices in China, Japan, Hong Kong, Taiwan, Singapore, and South Korea rose 0.01% to 1.26%. Indonesia's Jakarta Composite fell 0.21%.
Factory output in South Korea contracted 3.6% last month from a year earlier, after rising 3.3% in August, the government statistician said today.
Trading in US index futures indicated a flat opening of US stocks on Wednesday, 30 October 2013. US stocks surged on Tuesday, 29 October 2013, as soft economic data supported expectations the US Federal Reserve will keep its stimulus measures intact for several months. Economic data showed consumer confidence in the US fell and an October 22 report revealed growth in American jobs slowed in September.
The Federal Open Market Committee's (FOMC) two-day policy meeting concludes today, 30 October 2013. On 18 September 2013, the Fed surprised economists and investors with its decision to delay scaling back its stimulus amid concerns about the strength of the economic recovery.
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