Post result gains for index heavyweight Reliance Industries (RIL) ensured that key benchmark indices remained in positive zone. At 11:20 IST, the barometer index, the S&P BSE Sensex, was up 48.95 points or 0.18% at 27,263.55. The 50-unit CNX Nifty was up 5.45 points or 0.07% at 8,243.60. The market breadth indicating the overall health of the market was strong. On BSE, 1,379 shares rose and 904 shares fell. A total of 124 shares were unchanged. The BSE Mid-Cap index was up 0.17%, underperforming the Sensex. The BSE Small-Cap index was up 0.43%, outperforming the Sensex.
RIL surged after stronger-than-expected Q2 September 2015 results. The stock was currently up 4.4% at Rs 953.05. RIL's consolidated net profit rose 12.52% to Rs 6720 crore on 33.8% decline in turnover to Rs 75117 crore in Q2 September 2015 over Q2 September 2014. The result was announced after market hours on Friday, 16 October 2015. A strong showing of the refinery business and increase in profit margins of the petrochemicals business led to a stronger-than-expected growth in RIL's bottom line in Q2 September 2015. RIL's gross refining margins (GRM) hit a seven year high of $10.6 per barrel in Q2 September 2015. The GRM was $8.3 per barrel in Q2 September 2014. The profitability of the petrochemicals business improved due to a combination of strong volume growth, product mix improvement and lower energy costs.
RIL's bottom line was also boosted by exceptional one-time gain of Rs 252 crore in Q2 September 2015. This was a net impact of gains of Rs 2911 crore (net of taxes) on sale of investment in EFS Midstream LLC and provision for impairment in US shale gas assets amounting to Rs 2659 crore (net of tax). It may be recalled that Reliance Holding USA, Inc, a subsidiary of RIL concluded the sale of its interest in EFS Midstream LLC to an affiliate of Enterprise Products Partners L.P. in July 2015. EFS Midstream provides natural gas gathering, treating, compression and condensate processing services in the Eagle Ford Shale.
According to RIL, the near term outlook for the US shale gas business remains challenging due to weak macro environment. The long term outlook for the business remains promising.
With regard to the progress of the roll out of the broadband business, RIL said that the network roll-out across the country is substantially complete. RIL's subsidiary Reliance Jio Infocomm (RJIL) is implementing the ambitious broadband project. FY 2017 (year ending 31 March 2017) will be the first full year of commercial operations of RJIL.
Meanwhile, RIL also announced in its Q2 September 2015 investor presentation that RJIL and Reliance Communication (RCom) have decided to share spectrum in 800 MHz band in 7 telecom circles.
Shares of RCom were currently off 0.5% at Rs 82. The stock hit high of Rs 82.40 and low of Rs 81.20 so far during the trading session.
Power generations stocks were mixed. Adani Power (down 1.19%), Reliance Power (down 0.72%), Tata Power (down 0.72%), JSW Energy (down 0.63%), NHPC (down 0.29%) and NTPC (down 0.24%), edged lower. CESC (up 0.07%), GMR Infrastructure (up 0.07%), Reliance Infrastructure (up 0.10%), Jaiprakash Power Ventures (up 0.27%) and Torrent Power (up 0.94%), edged higher.
Capital goods shares were mixed. Alstom T&D India (up 1.34%), Praj Industries (up 0.94%), Suzlon Energy (up 0.83%), SKF India (up 0.68%), ALSTOM India (up 0.65%), Thermax (up 0.42%), Havells India (up 0.35%), BEML (up 0.19%), ABB India (up 0.12%) and Bharat Electronics (up 0.08%), edged higher. Lakshmi Machine Works (down 0.19%), Siemens (down 0.45%), Pipavav Defence and Offshore Engineering Company (down 0.59%), Bharat Heavy Electricals (down 0.8%), Larsen & Toubro (down 0.97%), Crompton Greaves (down 1.4%), Jindal Saw (down 2.08%) and Punj Lloyd (down 2.12%), edged lower.
Tata Sponge Iron lost 3.53% to Rs 493.20 after consolidated net profit fell 74.7% to Rs 5.69 crore on 27.9% drop in total income to Rs 161.46 crore in Q2 September 2015 over Q2 September 2014. The result was announced after market hours on Friday, 16 October 2015.
RPP Infra Projects rose 1.32% to Rs 123 after the company said that it has received a maiden order worth Rs 11.90 crore from Southern Railways. The company made announcement during market hours today, 19 October 2015.
Meanwhile, Reserve Bank of India Governor Raghuram Rajan reportedly said at an event in Mumbai today, 19 October 2015, that the government needs to put in place conditions for sustainable growth of the economy without resorting to populist policies.
In overseas stock markets, Asian shares were mixed after the latest data showed that China's economy grew 6.9% in Q3 September 2015 from a year ago, lower than 7% growth registered in Q2 June 2015. China's industrial production rose lower-than-expected 5.7% in September 2015 over September 2014. Fixed-asset investment (FAI), a key driver of the economy, also registered a lower-than-expected 10.3% growth in the first nine months of the year. Retail spending alone bucked the trend, growing at an annual rate of 10.9%. Chinese economic data is closely watched amid fears that a China-led slowdown in global growth could prompt the Fed to delay hiking rates for longer. US stocks edged higher during the previous trading session on Friday, 16 October 2015, as investors appeared to shrug off lackluster corporate earnings and mixed economic data.
Powered by Capital Market - Live News
