Key benchmark indices surged, with market sentiment boosted data showing that foreign funds remained net buyers of Indian stocks on Tuesday, 13 August 2013. The S&P BSE Sensex and the 50-unit CNX Nifty, both, attained their highest closing level in more than two weeks. The Sensex jumped 137.75 points or 0.72%, up close to 160 points from the day's low and off about 25 points from the day's high. The market breadth, indicating the overall health of the market, was positive.
Indian stocks gained for the fourth straight day today, 14 August 2013. From a recent low of 18,664.88 on 7 August 2013, the Sensex has gained 702.71 points or 3.76% in four trading sessions. The Sensex has risen 21.89 points or 0.11% in this month so far (till 14 August 2013). The Sensex has declined 59.12 points or 0.3% in calendar 2013 so far (till 14 August 2013). From a 52-week high of 20,443.62 on 20 May 2013, the Sensex has fallen 1,076.03 points or 5.26%. From a 52-week low of 17,250.80 on 5 September 2012, the Sensex has surged 2,116.79 points or 12.27%.
Coming back to today's trade, index heavyweight Reliance Industries (RIL) extended gains in late trade. Another index heavyweight and cigarette maker edged higher in choppy trade. Shares of state-run upstream oil companies and PSU OMCs surged after oil minister M Veerappa Moily said in an interview to a business news channel that the government will consider a request from PSU OMCs to be allowed to raise diesel prices by more than the approved 50 paise per month.
Tata Motors extended Tuesday's gains triggered by its British luxury car unit Jaguar Land Rover (JLR) reporting strong sales for July 2013. Steel Authority of India fell after declaring poor Q1 result. Essar Oil surged in choppy trade after the company pruned losses in Q1 June 2013.
The market sentiment was boosted by data showing that foreign funds remained net buyers of Indian stocks on Tuesday, 13 August 2013. Foreign institutional investors (FIIs) bought shares worth a net Rs 255.40 crore from the secondary equity markets on Tuesday, 13 August 2013, as per data from Securities & Exchange Board of India.
The S&P BSE Sensex jumped 137.75 points or 0.72% to 19,367.59, its highest closing level since 29 July 2013. The index jumped 162.72 points at the day's high of 19,392.56 in late trade. The index fell 26.21 points at the day's low of 19,203.63 in morning trade.
The CNX Nifty was up 43 points or 0.75% to 5,742.30, its highest closing level since 30 July 2013. The index hit a high of 5,754.55 and a low of 5,690.20 in intraday trade.
The BSE Mid-Cap index rose 0.66% and the BSE Small-Cap index gained 0.3%. Both these indices underperformed the Sensex.
The total turnover on BSE amounted to Rs 1920 crore, lower than Rs 1964 crore on Tuesday, 13 August 2013.
The market breadth, indicating the overall health of the market, was positive. On BSE, 1,298 shares gained and 1,048 shares fell. A total of 154 shares were unchanged.
Among the 30-share Sensex pack, 18 stocks gained and rest of them declined.
Index heavyweight and cigarette maker ITC rose 0.6% to Rs 336.20. The stock hit a high of Rs 336.70 and low of Rs 329.45.
Index heavyweight Reliance Industries rose 1.48% to Rs 865, with the stock extending gains in late trade. The stock hit a high of Rs 867.65 and low of Rs 847.50.
Shares of state-run upstream oil companies and PSU OMCs surged after oil minister M Veerappa Moily said in an interview to a business news channel that the government will consider a request from PSU OMCs to be allowed to raise diesel prices by more than the approved 50 paise per month.
State-run oil exploration giant ONGC surged 5.47%. Oil India advanced 3.59%.
Shares of state-run gas transmission and distribution major GAIL (India) gained 3.89%.
On 17 January 2013, the government partially decontrolled diesel prices, giving authority to the marketing companies to raise diesel prices by a small margin from time to time. The government at that time also allowed PSU OMCs to sell diesel to bulk buyers at market rates.
Three state-run upstream oil firms -- Oil India, ONGC and GAIL (India) -- share part of the under-recoveries of PSU OMCs arising from the government-imposed price caps on three key fuels -- diesel, LPG for domestic use and kerosene sold through the public distribution system.
Among PSU OMCs, BPCL (up 6.31%) and Indian Oil Corporation (up 6.76%), surged.
HPCL rose 1.32% in volatile trade. The stock turned ex-dividend today, 14 August 2013, for dividend of Rs 8.50 per share for the year ended 31 March 2013 (FY 2013).
PSU OMCs suffer under recoveries on domestic sale of diesel, LPG and kerosene at controlled prices. The government had already freed pricing of petrol.
Essar Oil surged in choppy trade after the company pruned losses in Q1 June 2013. The stock jumped by the maximum permissible level of 5% to Rs 60.35. The stock witnessed volatility after the result hit the market in mid-afternoon trade. The stock which had remained locked at 5% upper circuit before the result announcement reversed direction and fell as much as 0.52% at the day's low of Rs 57.20. The stock bounced back again later. The company reported net loss of Rs 863 crore in Q1 June 2013, which was sharply lower than net loss of Rs 1518 crore in Q1 June 2012. Gross revenue rose 12% to Rs 24721 crore in Q1 June 2013 over Q1 June 2012.
Essar Oil said that the 12% growth in gross revenue in Q1 June 2013 was led by 15% improvement of throughput, which stood at 5.14 million metric tonnes (MMT) in Q1 June 2013, against 4.48 MMT in Q1 June 2012. Earnings before interest, taxes, depreciation and amortization (EBITDA) was reported at Rs 1106 crore in Q1 June 2013, as agaist negative EBITDA of Rs 178 crore in Q1 June 2012. The current price Gross Refining Margin (GRM) jumped 49% to $7.01 per bbl in Q1 June 2013 over Q1 June 2012, reflecting the higher complexity benefits post completion of expansion and optimization projects
The company reported a net loss of Rs 863 crore Q1 June 2013, mainly due to negative forex fluctuations arising out of 10% rupee depreciation during the quarter. Essar Oil follows a very prudent risk management policy to hedge all its risks against currency fluctuations. As a result, the forex variations are mostly of mark-to-market nature, which is recoverable through sales or GRM in next quarters and hence have cash and earning neutral impact during the full financial year, the company said.
Capital goods pivotals edged lower. L&T (down 0.73%), Siemens (down 2.78%) and Bhel (down 1.86%) declined.
Most IT stocks edged lower. Infosys declined 0.49% to Rs 3,069.80. The stock had hit 52-week high of Rs 3,098.40 in intraday trade on Tuesday, 13 August 2013.
Wipro declined 1.39% to Rs 460.30. The stock reversed direction after hitting a 52-week high of Rs 473.20 in intraday trade today, 14 August 2013.
HCL Technologies dropped 2.07% to Rs 920.80. The stock had hit a record high of Rs 960.75 in intraday trade on 5 August 2013.
IT major TCS rose 0.64% to Rs 1,830.55. The stock had hit a record high of Rs 1,890.30 in intraday trade on 7 August 2013.
The partially convertible rupee was hovering at 61.36, weaker than its close of 61.19/20 on Tuesday, 13 August 2013. The rupee had record low of 61.80 in intraday deals on 6 August 2013. A weak rupee boosts revenue of IT firms in rupee terms as the sector derives a lion's share of revenue from exports.
Financial Technologies (India) dropped 13.51% to Rs 146.60 after sliding as much as 34.81% at the day's low of Rs 110.50 in early trade. Reportedly top stockbrokers threatened to seek legal recourse if its unit National Spot Exchange (NSEL) is unable to repay its dues to the brokers and investors. Shares of group firm Multi Commodity Exchange of India (MCX) fell by maximum permissible 5% lower circuit at Rs 253.30, also its record low.
Oracle Financial Services Software fell 1.38%. The company's consolidated net profit fell 1% to Rs 366.20 crore on 5% decline in total revenue to Rs 899.40 crore in Q1 June 2013 over Q1 June 2012. Net profit surged 30% to Rs 366.20 crore on 2% increase in total revenue to Rs 899.40 crore in Q1 June 2013 over Q4 March 2013. The result was announced after market hours on Tuesday, 13 August 2013.
The company signed new licenses of $18 million in Q1 June 2013 and 10 new customers for the product portfolio.
Commenting on the first quarter results, Chet Kamat, Managing Director and CEO, Oracle Financial Services Software, said: "We continued to maintain the winning momentum in various regions across the world signing $18 million in new license fees in the quarter. All our lines of business posted strong operating performance. This performance is a testimonial to the breadth of our product capability sustained through focussed investments to grow our addressable market."
Makarand Padalkar, CFO, Oracle Financial Services Software, said: "In a challenging environment, we delivered robust performance with net margins at 41% registering a nine percentage point increase since the last quarter."
Motherson Sumi Systems gained 3.62% to Rs 236.30 after striking a record high of Rs 241.10 in intraday trade today, 14 August 2013.
DLF gained 5.85%, with the stock extending Tuesday's rally triggered by the company reporting turnaround financial performance on sequential basis in Q1 June 2013. The company reported consolidated net profit of Rs 181 crore in Q1 June 2013, as against net loss of Rs 4 crore in Q4 March 2013. Earnings before interest, taxation, depreciation, and amortization (EBITDA) jumped 29% to Rs 1055 crore in Q1 June 2013 over Q4 March 2013. Revenue rose 6% to Rs 2453 crore in Q1 June 2013 over Q4 March 2013. The company announced Q1 result after market hours on Monday, 12 August 2013.
DLF said that the benefit of the revised strategy, which was articulated in February 2013, has now started to flow. The company remains focused on creating a business model of highly stable and predictable earnings, cash flows and long term value creation. The company continues to concentrate its efforts on reduction of net debt by increasing its operating cash flows and non-core divestments thereby increasing ROE, DLF said.
Many other realty stocks were in green. Unitech (up 1.96%), D B Realty (up 4.98%), and Godrej Properties (up 1.41%), edged higher.
Tata Motors extended Tuesday's gains triggered by its British luxury car unit Jaguar Land Rover (JLR) reporting strong sales for July 2013. The stock jumped 9.67% to Rs 319.30. JLR's sales jumped 21% to 31,611 units in July 2013 over July 2012. Sales of the Jaguar brand of vehicles jumped 65% to 6,157 units in July 2013 over July 2012. Land Rover sales rose 14% to 25,454 vehicles in July 2013 over July 2012.
Tata Motors' global wholesales in July 2013, including Jaguar Land Rover, totaled 87,566 units. Global wholesales of all commercial vehicles - Tata, Tata Daewoo and the Tata Hispano Carrocera range -- were 40,882 units. Global wholesales of all passenger vehicles in July 2013 were 46,684 vehicles. Global wholesales of Tata passenger vehicles in July 2013 were 11,522 units. Global wholesales for Jaguar Land Rover were 35,162 vehicles. Jaguar wholesales for the month were 7,174 vehicles and Land Rover wholesales for the month were 27,988 vehicles.
Mahindra & Mahindra (M&M) edged higher in choppy trade. The stock was up 0.29% at Rs 873.40. The scrip hit high of Rs 884.75 and low of Rs 864. The stock had edged higher in choppy trade on Tuesday, 13 August 2013, boosted by the company's strong Q1 results. The combined net profit of M&M and its 100% subsidiary Mahindra Vehicle Manufacturers (MVML) rose 16.9% to Rs 909.70 crore on 8% increase in gross revenue to Rs 10801.50 crore in Q1 June 2013 over Q1 June 2012. MVML, located at Chakan near Pune in Maharashtra, has been set up as a 100% subsidiary of M&M with a view to source contemporary products for expanding the market offering of M&M
With regard to future business outlook, M&M said that a fair degree of macroeconomic turbulence in the near term seems inevitable and hence the company, at this point, maintains a cautious and watchful outlook on the economy.
M&M after market hours today, 14 August 2013, said it plans to invest Rs 200 crore to strengthen its current product line-up of trucks and buses. The company plans to invest Rs 300 crore to explore new product lines in the LCV, ICV and MCV range, it said.
Maruti Suzuki India declined 0.68%.
Shares of two wheeler companies were mixed. Bajaj Auto rose 2.64%. Bajaj Auto after market hours on Tuesday, 13 August 2013, said that the company has received a notice from the workmen's union viz. Vishwa Kalyan Kamgar Sanghatana stating that the stoppage of work at Chakan plant has been withdrawn and all the workmen at Chakan plant will resume their duty in their respective shifts from 14 August 2013. The company had earlier informed on 25 June 2013, that it had received a notice from the workmen's union of its Chakan plant viz., Vishwa Kalyan Kamgar Sanghatana stating that they propose to call for a stoppage of work by all the workmen employed in Chakan plant from the morning shift of 28 June 2013. The workmen at Chakan Plant had however, stopped coming from 25 June 2013 itself, without assigning any reason.
Hero MotoCorp fell 0.34%.
Escorts spurted by maximum permissible 20% upper limit at Rs 88.65 after net profit galloped 215.6% to Rs 58.30 crore on 16.2% growth in net sales to Rs 1172.89 crore in Q3 June 2013 over Q3 June 2012. The Q3 result was announced after market hours on Tuesday, 13 August 2013.
Escorts' earnings before interest, taxation, depreciation and amortization (EBITDA) jumped 71.6% to Rs 92.70 crore in Q3 June 2013 over Q3 June 2012. The company attributed the surge in EBITDA to increase in volumes, better product mix and better price realization along with cost saving across all verticals.
Commenting on the company's Q3 results, Mr. Rajan Nanda, CMD, Escorts said, "Management initiatives have focused on entrepreneurial strategies that are opening up new markets, new opportunities and a better profitable presence in the market. At the crux of these consistently strong results over the past few quarters is the strategy of improving volumes and strengthening margins by introducing high power and specialized tractors. The performance is even more noteworthy when seen in the context of the overall economic environment."
Mr. Nikhil Nanda, Joint MD, Escorts said that the Management will continue to remain focused on execution to further improve the operating performance in the months ahead. While the pain point has been the construction sector, there is no denying the ultimate potential of the business, he added. Mr. Nikhil further said that the company sees improvement in the Railways and Auto Products business which is adding to the bottom line.
Tata Steel rose 3.59% to Rs 249.80 on strong Q1 results. The stock was volatile. The scrip hit high of Rs 263 and low of Rs 246.30. The company's consolidated net profit jumped 90.46% to Rs 1139 crore on 3% fall in turnover to Rs 32805 crore in Q1 June 2013 over Q1 June 2012. The result was announced after market hours on Tuesday, 13 August 2013. This improvement was on the back of robust performance by the Indian operations and improved performance at the European operations, Tata Steel said.
Earnings before interest, taxation, deprecation and amortization (EBITDA) rose 4.85% to Rs 3755 crore in Q1 June 2013 over Q1 June 2012. The EBITDA margin edged up to 11.4% in Q1 June 2013, from 10.6% in Q1 June 2012.
Commenting on the first quarter results, Tata Steel Managing Director, Mr HM Nerurkar said: "The Indian operations delivered a steady performance in a subdued market environment with deliveries growing at an enhanced pace over the comparable period of last year. Our retail focus, customer relationship and brand building efforts are supporting growth despite increased competition in the market place and we are intensifying our focus on efficiency improvements and delivering enhanced value to our customers. Work on the greenfield project in Odisha continues in full swing. The South East Asian operations are robust and we continue to invest in improving the underlying performance."
Tata Steel Europe MD & CEO Dr Karl-Ulrich Kler said: "Our European facilities recorded higher production volumes after we completed some major plant refurbishment last year, which gave us a more stable production platform and greater operational flexibility. As a result we are better placed to supply our customers with the high-quality steel they demand. We see signs that our strategy is enhancing bottom-line performance, despite continued subdued European demand. There have recently been encouraging signs of improving economic conditions in some European economies, the UK in particular, and we are poised to capitalise should these translate more strongly into increased demand from steel-intensive sectors."
Other metal and mining stocks were also in demand. Sterlite Industries (India) rose 2.39%, with the stock extending recent gains. The company on 8 August 2013 said that the National Green Tribunal (NGT) has in its judgment upheld its interim order of 31 May 2013, and has allowed the company's Tuticorin Copper Smelter to continue to operate.
Sesa Goa rose 2.28%. The company on 12 August 2013 said that the Division Bench of the High Court of Bombay at Goa vide its order dated 12 August 2013 has dismissed the appeal filed by the shareholder of Sesa Goa and sanctioned the Scheme of amalgamation and arrangement amongst Sterlite Industries (India), Madras Aluminium Company, Sterlite Energy, Vedanta Aluminium and Sesa Goa and their respective shareholders and creditors and the scheme of amalgamation of Ekaterina with the company and their respective shareholders and creditors.
Hindalco Industries jumped 7.16%. The company's net profit rose 11.52% to Rs 474 crore on 3.15% decline in revenue from operations to Rs 5838 crore in Q1 June 2013 over Q1 June 2012. Earnings before interest, taxation, depreciation and amortization (EBITDA) rose 3.45% to Rs 479 crore in Q1 June 2013 over Q1 June 2012. Hindalco said that the performance in Q1 June 2013 was achieved despite adverse macro-economic headwinds. Hindalco announced the standalone results during trading hours on Tuesday, 13 August 2013.
Hindalco said that there has been a significant progress on all projects being implemented by the company and its subsidiary Utkal Alumina International (UAIL). The company also said that in view of the delays in getting various regulatory approvals and the current uncertain economic environment, the company is re-evaluating its investment strategy with respect to its proposed Aditya Refinery and Jharkhand Aluminium Projects.
On future business outlook, the company said that its focus is now on ramping up the new projects already on stream. Depressed LME prices in an otherwise inflationary scenario pose a significant challenge, Hindalco said. However, the company is confident of riding through these challenges with its trust on stabilizing the projects, operational efficiencies and cost control, Hindalco Industries said.
JSW Steel (up 2.98%), NMDC (up 5.11%), and Hindustan Zinc (up 2.55%) edged higher.
Steel Authority of India fell 2.37% after net profit declined 35.25% to Rs 450.91 crore on 5.08% fall in total income to Rs 10494.08 crore in Q1 June 2013 over Q1 June 2012. The result was announced during trading hours today, 14 August 2013.
LIC Housing Finance rose 1.83%. The company reported 36.33% rise in net profit to Rs 310.50 crore on 23.23% rise in total income to Rs 2177.93 crore in Q1 June 2013 over Q1 June 2012. The result was announced during market hours today, 14 August 2013.
Strides Arcolab lost 7.83%. The company after market hours on Tuesday, 13 August 2013, said that the Reserve Bank of India on 13 August 2013 directed all the custodian banks not to facilitate any purchase transactions on behalf of foreign institutional investors in the company's shares till further intimation. Earlier, the company had announced that shareholders had approved increase in FII limit to 74%.
The finance ministry on 6 August 2013 said that the government has kept in abeyance decision on Strides Arcolab's proposal to sell its specialties subsidiary -- Agila Specialties -- to US based Mylan Inc. until DIPP finalizes policy on FDI in brown field pharma projects involving transfer of control. Strides Arcolab had in February 2013 announced the sell of Agila Specialties to Mylan Inc. for a net consideration of about $1.725 billion.
AstraZeneca Pharma India rose 19.28% to Rs 880.50 after the company reported a net profit of Rs 1.76 crore in Q1 June 2013, as against net loss of Rs 8.14 crore in Q1 June 2012. Net sales rose 37.11% to Rs 125.13 crore in Q1 June 2013 over Q1 June 2012. The result was announced at the fag end of the trading sessions on Tuesday, 13 August 2013.
Voltas lost 4.38% after consolidated net profit fell 48.5% to Rs 40.75 crore on 0.6% decline in net sales to Rs 1601.78 crore in Q1 June 2013 over Q1 June 2012. The Q1 result was announced after market hours on Tuesday, 13 August 2013.
The stock market remains closed tomorrow, 15 August 2013, on account of Independence Day.
Inflation based on the wholesale price index (WPI) accelerated to 5.79% in July 2013, from 4.86% in June 2013, data released by government today, 14 August 2013 showed. Fuel and power group mainly contributed to increase in inflation in July 2013.
The WPI inflation has moved past the central bank's comfort zone. The Reserve Bank of India has said it can tolerate inflation up to 5%, but that a faster pace of price increase hurts the economy's long-term growth prospects.
Meanwhile, the government revised downwards inflation for May 2013 to 4.58% from the 4.7% reported earlier.
European stocks rose on Wednesday, 14 August 2013, after the latest data showed that euro-zone has emerged from a six-quarter recession. Key benchmark indices in France, UK and Germany were up 0.06% to 0.37%.
The euro-zone economy emerged more strongly than expected from its longest postwar contraction in the three months to June, but a resolution to its twin banking and fiscal crises remains a distant prospect. The European Union's official statistics agency Wednesday said the combined gross domestic product of the currency area's 17 members was 0.3% higher than in the first three months of the year, but 0.7% lower than in the second quarter of 2012. It was the fastest expansion since the first three months of 2011.
Germany's gross domestic product swelled 0.7% in the second quarter from the preceding period. Germany's statistics office said growth in the second quarter was driven by domestic demand, as both private consumption and public spending increased from the first quarter.
The French economy jumped out of recession in the second quarter, aided by stronger domestic demand and a rebuilding of stocks, official statistics showed Wednesday. The euro zone's second-largest economy expanded 0.5% in the second quarter from the first quarter of this year, statistics bureau Insee said. The expansion in the second quarter follows two consecutive quarters of contraction--the common definition of a recession.
The minutes of the Bank of England's (BoE) most recent Monetary Policy Committee (MPC) meeting showed that eight of the nine MPC members voted in favor of providing forward guidance on policy last month, and the vote to keep the quantitative-easing policy unchanged was unanimous. The central bank said it would keep interest rates at historical lows until unemployment falls.
Asian stocks edged higher on Wednesday, 14 August 2013, following positive cues from Wall Street overnight. Key benchmark indices in China, Japan, Indonesia, Singapore and South Korea were up by 0.14% to 1.32%. Key benchmark indices in China and Taiwan were down by 0.29% to 0.44%.
Trading in Hong Kong was canceled because of a storm.
Trading in US index futures indicated that the Dow could fall 18 points at the opening bell on Wednesday, 14 August 2013. US stocks rose on Tuesday, 13 August 2013, with technology pacing the gains, after investor Carl Icahn touted his large position in Apple Inc.
A report released by the Commerce Department showed retail sales rose 0.2% in July after a 0.6% gain in June that was larger than initially estimated. Retail sales excluding cars, gasoline and building materials climbed at their fastest pace in seven months.
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