Indian stocks fell for the third day in a row today, 29 April 2014, triggered by the India Meteorological Department (IMD) on Thursday, 24 April 2014, announcing that the country will likely get below-normal levels of monsoon rain this year. Investors also remained wary ahead of the announcement of Federal Reserve's monetary policy review tomorrow, 30 April 2014. The barometer index, the S&P BSE Sensex, fell 165.42 points or 0.73%, up about 23 points from the day's low and off close to 216 points from the day's high. The Sensex and the 50-unit CNX Nifty, both, hit their lowest closing levels in almost two weeks. The market breadth, indicating the overall health of the market, was negative.
The Sensex has fallen 410.35 points, or 1.79% in three trading sessions from a recent high of 22,876.54 on 23 April 2014. The Sensex has risen 79.92 points or 0.36% in this month so far (till 29 April 2014). The Sensex has gained 1,295.51 points or 6.12% in calendar year 2014 so far (till 29 April 2014). From a 52-week low of 17,448.71 on 28 August 2013, the Sensex has risen 5,017.48 points or 28.76%. From a record high of 22,939.31 on 25 April 2014, the Sensex has fallen 473.12 points or 2.06%.
Metal stocks declined. Jindal Steel & Power slumped on weak Q4 results. Sesa Sterlite dropped as profitability declined sequentially in Q4.
The market dropped in early trade. It extended initial losses and hit fresh intraday low in morning trade. It languished in the negative terrain in mid-morning trade. It trimmed intraday losses in early afternoon trade. Key benchmark indices continued hovering in negative territory in afternoon trade. It remained weak in mid-afternoon trade.
Foreign institutional investors (FIIs) bought shares worth a net Rs 77.02 crore on Monday, 28 April 2014, as per provisional data from the stock exchanges.
The S&P BSE Sensex fell 165.42 points or 0.73% to 22,466.19, its lowest closing level since 16 April 2014. The index fell 188.05 points at the day's low of 22,443.56 in late trade. The index rose 50.28 points at the day's high of 22,681.89 in early trade.
The CNX Nifty fell 46 points or 0.68% to 6,715.25, its lowest closing level since 16 April 2014. The index hit a low of 6,708.65 in intraday trade. The index hit a high of 6,779.70 in intraday trade.
The BSE Mid-Cap index fell 32.37 points or 0.44% to 7,406.12. The BSE Small-Cap index was down 1.62 points or 0.02% to 7,615.66. Both these indices outperformed the Sensex.
The market breadth, indicating the overall health of the market, was negative. On BSE, 1,506 shares fell and 1,281 shares rose. A total of 123 shares were unchanged.
The total turnover on BSE amounted to Rs 2853 crore, higher than Rs 2765.66 crore on Monday, 28 April 2014.
The S&P BSE Consumer Durables index rose 0.18%. The S&P BSE Healthcare index (down 0.04%), the S&P BSE IT index (down 0.07%), the S&P BSE Teck index (down 0.23%), the S&P BSE Realty index (down 0.38%) and the S&P BSE Oil & Gas index (down 0.38%), outperformed the Sensex.
The S&P BSE Metal index (down 2.69%), the S&P BSE Bankex (down 1.27%), the S&P BSE Auto index (down 1.19%), the S&P BSE Power index (down 1.11%), the S&P BSE FMCG index (down 0.83%) and the S&P BSE Capital Goods index (down 0.75%), underperformed the Sensex.
Among the 30-share Sensex pack, 25 stocks declined and rest of them rose.
Most auto stocks declined. Ashok Leyland (down 2.37%), Escorts (down 2.2%), Maruti Suzuki India (down 1.85%), Tata Motors (down 1.76%), Eicher Motors (down 0.4%) and M&M (down 0.04%), edged lower.
Bajaj Auto shed 2.20% to Rs 1,941.75. With reference to the earlier announcement dated 18 April 2014 regarding propose to call for a stoppage of work by all the workmen employed in Chakan plant, Bajaj Auto has now informed that the company has received a notice dated 27 April 2014 from the workmen's union of its Chakan plant viz., Vishwa Kalyan Kamgar Sanghatana stating that the stoppage of work in the Chakan plant of the company has been postponed to 15 May 2014.
Hero MotoCorp dropped 0.92% to Rs 2,145.20. However, TVS Motor Company jumped 6.10% to Rs 92.25.
Metal stocks declined. JSW Steel (down 4.86%), Tata Steel (down 4.79%), Sail (down 4.05%), Hindalco Industries (down 2.87%) and Bhushan Steel (down 0.23%), edged lower.
Jindal Steel & Power slumped 7.41% to Rs 253.20 on weak Q4 results. The company's consolidated net profit fell 47% to Rs 402.50 crore on 10% decline in turnover to Rs 5102.56 crore in Q4 March 2014 over Q4 March 2013. The company announced results during market hours.
Sesa Sterlite dropped 1.37% to Rs 190.40 after consolidated net profit as per adjusted proforma basis fell 31.34% to Rs 1222 crore on 7.05% rise in net sales to Rs 20784 crore in Q4 March 2014 over Q3 December 2013. The result was announced during market hours today, 29 April 2014.
Sesa Sterlite's consolidated net profit as per adjusted proforma basis fell 31.34% to Rs 1222 crore on 7.05% rise in net sales to Rs 20784 crore in Q4 March 2014 over Q3 December 2013. Sesa Sterlite attributed rise in Q4 sales to higher volumes across businesses. The Sesa Sterlite merger and the Vedanta Group consolidation was completed in August 2013 and hence the actual Q3, Q4 and FY 2014 numbers are not comparable with those of the corresponding prior periods, the company said.
Sesa Sterlite's consolidated net profit as per adjusted proforma basis fell 30.98% to Rs 5005 crore on 1.12% rise in net sales to Rs 72591 crore in the year 31 March 2014 over the year ended 31 March 2013.
Sesa Sterlite said that full year actual financial numbers include results of all consolidating entities of Sesa Sterlite for the full year, except Cairn India, which is consolidated from 26 August 2013. Hence, the company has drawn an adjusted proforma account for FY 2014 to indicate the performance during the period, had the merger been effected from beginning of the period. The adjusted proforma numbers also excludes the impact of a one-time tax benefit during Q2, at the time of the merger. Similarly, the adjusted proforma numbers for FY 2013 have been prepared on the same lines, as if the restructuring and full consolidation had taken place as of 1 April 2012.
In line with the Q3 adjusted proforma numbers, Q4 adjusted proforma have been provided to reflect the goodwill amortisation on the basis of production at Lisheen mine as compared to the accelerated amortisation carried out in Q2 actuals. However, an additional amount of Rs 298 crore for goodwill of Lisheen mine has been provided in Q4 adjusted proforma to align the full year amortisation charge between actual and adjusted proforma numbers, Sesa Sterlite said.
Tata Sponge Iron surged by 20% upper limit at Rs 574 after consolidated net profit jumped 335.95% to Rs 40.50 crore on 11.91% growth in total income from operations to Rs 236.56 crore in Q4 March 2014 over Q4 March 2013. The Q4 result was announced before market hours today, 29 April 2014. Tata Sponge Iron's consolidated net profit rose 18.54% to Rs 101.19 crore on 1.7% decline in total income from operations to Rs 782.22 crore in the year ended 31 March 2014 (FY 2014) over the year ended 31 March 2013 (FY 2013).
Tata Sponge Iron's board of directors at its meeting held on Monday, 28 April 2014, recommended dividend of Rs 10 per share for FY 2014.
Telecom shares edged lower. Tata Teleservices (Maharashtra) (down 2.14%), MTNL (down 1.33%), Reliance Communications (down 0.87%), and Idea Cellular (down 0.07%), edged lower.
Bharti Airtel fell 0.81% to Rs 335.15. On a consolidated basis, the company's net profit jumped 89.07% to Rs 961.60 crore on 13.62% increase in total income to Rs 22,260.50 crore in Q4 March 2014 over Q4 March 2013. The company announced the results after market hours today.
The Telecom Disputes Settlement and Appellate Tribunal (TDSAT) Tuesday reportedly cleared the 3G intra-circle roaming agreements signed between Bharti Airtel, Idea Cellular and Vodafone India, saying the pacts did not violate any license conditions.
According to reports, TDSAT, in its ruling, also quashed the penalties levied on the three operators by the telecom department (DoT). The DoT had hauled up Bharti Airtel, Vodafone India and Idea Cellular for forging 3G service sharing pacts that allowed them to sign up 3G customers even in service areas, or circles, where they did not have permits. DoT had said that three violated 3G license conditions.
The DoT had earlier slapped penalties of Rs 350 crore on Bharti Airtel, Rs 550 crore on Vodafone and Rs 300 crore on Idea Cellular for providing the 3G facilities outside their licensed telecom zones through the ICR agreements, reports added.
Jaiprakash Associates fell 1.29% to Rs 57.35. With reference to the earlier letter dated December 07, 2013 informing about the approval of the Scheme of Arrangement between Jaypee Cement Corporation Limited (JCCL) and UltraTech Cement Limited (UCL) and their respective Shareholders & Creditors, Jaiprakash Associates announced that High Court of Judicature at Allahabad has sanctioned the Scheme filed by JCCL on 17 April 2014, which was uploaded on the site on 28 April 2014.
The Scheme filed by the Transferee Company, namely UCL, before High Court of Judicature at Bombay had already been sanctioned on 4 April 2014. Jaiprakash Associates made the announcement after market hours today.
Hexaware Technologies tumbled 10.75% to Rs 153.15 after consolidated net profit fell 31.89% to Rs 70.30 crore on 5.02% decline in income from operations to Rs 588.87 crore in Q1 March 2014 over Q4 December 2013. The Q1 result was announced during trading hours today, 29 April 2014.
Hexaware Technologies (Hexaware)'s consolidated EBITDA margin declined 330 basis points QoQ to 19.2% in Q1 March 2014.
The company's cash & cash equivalents stood at Rs 443 crore as of 31 March 2014.
Hexaware added 11 new clients in Q1 March 2014. The company currently has 235 active clients.
P R Chandrasekar, CEO and Vice Chairman, Hexaware Technologies stated, "Though this quarter has been soft, we expect a healthy growth in revenue in Q2 2014 on the back of the visibility from our existing customers and our deal pipeline. To enable the company's future growth prospects, Hexaware has invested by adding 167 freshers offshore during the quarter. In addition, the company has further strengthened its field sales force by a gross addition of 14 personnel for sales and marketing activities".
Keeping with the growth focus, P R Chandrasekar added "We have engaged a leading onsulting firm to provide advisory on sharpening the 'Go to Market' strategy, conducting portfolio assessment of our micro-verticals and to institutionalize sales excellence processes. This initiative will drive the company on its long term growth path".
During the quarter, Hexaware said it experienced decline in revenue from some of its Top 10 customers. This was primarily due to some project closures as well as budget re-allocation to other initiatives on the client side, the company said. However, the relationships with all these customers continue to be strong and the company expects a healthy growth from the same set of clients in the coming quarters, Hexaware said in a statement. The company expects to register healthy revenue growth QoQ and an improvement in operating margin in Q2 June 2014, Hexaware said in a statement.
Hexaware Technologies' board of directors at its meeting held today, 29 April 2014, declared payment of interim dividend of Rs 3 per share for the year ending 31 December 2014.
HCL Infosystems lost 6.33% to Rs 46.65. The company's net profit rose 11.3% to Rs 2.56 crore on 8.42% decline in income from operations to Rs 1316.49 crore in Q3 March 2014 over Q2 December 2013. The Q3 result was announced after market hours on Monday, 28 April 2014.
The net profit in Q3 March 2014 was boosted by an exceptional gain of Rs 21.57 crore in Q3 March 2014. There was a profit of Rs 26.19 crore on sale of properties while there was an inventory writeoff of Rs 4.62 crore due to phasing out of a product line.
Commenting on the results, Mr. Harsh Chitale, Managing Director and Chief Executive Officer, HCL Infosystems said, "Our transformation story is progressing well and is now taking roots. Distribution and Services, our focused growth areas have registered healthy traction. Our portfolio diversification strategy in Distribution continues to yield results as our non-telecom distribution business achieved a 12% QoQ and 25% YoY growth. Though our Telecom Distribution business did register a decline in topline, the gross margin expanded on account of increase in scope of engagement. As part of a new initiative, the Telecom Distribution business enrolled 88 new rural distributors in JFM Quarter that will further strengthen its footprint in the country. Our Enterprise Services also grew by 8% QoQ and 9% YoY on account of growth in our order book across India, MEA and South-East Asia. While our Break fix Services gained positive traction as a provider of multi-vendor technology support services, our Managed Services expanded its overseas foothold with a large contract in South East Asia. Our hardware-solutions businesses which we had decided to reduce focus on, are transitioning as per plan. However, business model transitions for these businesses led to repositioning charges in the current quarter and may impact next quarter as well".
Gujarat Gas Company rose 1.36% to Rs 390.60 after the company was granted an extension of exclusivity for a block by PNGRB. Gujarat Gas Company after market hours on Monday, 28 April 2014 said that as per the relevant provisions of the PNGRB Act, 2006 and PNGRB (Exclusivity for City or Local Natural Gas Distribution Network) Regulations, 2008, the PNGRB has granted to the company, an extension of exclusivity for a block of ten years to lay, build and expand the CGD network in the authorised geographical area of Surat-Bharuch-Ankleshwar CGD network up to 31 March 2024.
Gujarat Gas Company had on 21 April 2014 announced that its board approved the amalgamation and arrangement between the company, Gujarat Gas Financial Services (GFSL), Gujarat Gas Trading Company (GTCL), GSPC Gas Company (GSPC Gas) and GSPC Distribution Networks (GDNI).
As per the scheme, the company, GFSL, GTCL, and GSPC Gas would be amalgamated with GDNL. All assets and liabilities of the company, GFSL, GTCL and GSPC Gas would be transferred to GDNL. The appointed date of the scheme would be 1 April 2013.
In consideration of the amalgamation, GDNL will allot 1 equity share for every 1 equity share of GGCL. Similarly, it will allot 1 equity share for every 1 equity share of GFSL.
GDNL will allot 81 equity shares for every 76 equity shares of GSPC Gas. GSPC Gas holds 44.45% of the total issued, subscribed and paid-up share capital of GDNL, which shall get extinguished.
The company holds 69.88% and 100% of the total issued, subscribed and paid-up share capital of GFSL and GTCL respectively. Since the company, GFSL and GTCL are the transferor companies, the shares held by the company in GFSL and GTCL shall get extinguished. Accordingly, no new shares of GDNL shall be issued in lieu of such shares getting extinguished, the company said.
Currently, GSPC Gas, GSPL and GSFC holds 44.45%, 38.89% and 16.66% paid up capital of GDNL respectively. Further, the existing Issued, Subscribed and Paid up Capital of GDNL will be reduced.
Dabur India lost 1.36% to Rs 177.70 after consolidated net profit rose 17.3% to Rs 235.29 crore on 15.5% growth in net sales to Rs 1769.02 crore in Q4 March 2014 over Q4 March 2013. The Q4 result was announced during trading hours today, 29 April 2014.
Dabur India said that the topline in Q4 March 2014 was boosted by strong volume-led growth across key categories like Health Supplements, Digestives, Shampoos, Toothpastes, Foods & Home Care which helped the company to mitigate the impact of a challenging business environment and macro headwinds.
Commenting on the company's financial performance, Dabur India Chief Executive Officer Mr. Sunil Duggal said, "The business has performed well on all operating parameters. Our strong performance reflects the robustness of our business model and our ability to efficiently manage the emerging challenges. Dabur has been reporting strong and consistent performance despite intensifying competitive pressures and the challenging market environment being witnessed for some quarters now. Going forward too, our focus will be on pursuing an aggressive and profitable growth strategy".
Dabur India's consolidated net profit rose 19.7% to Rs 913.92 crore on 15.1% growth in net sales to Rs 7073.21 crore in the year ended 31 March 2014 (FY 2014) over the year ended 31 March 2013 (FY 2013).
Dabur's International Business continues to be a key growth driver, recording a robust 20% growth during Q4 March 2014, led by strong performance in GCC, Egypt and Levant (comprising Yemen, Jordan, Lebanon & Syria) markets. During the full year 2013-14, the Levant business reported a strong 32% growth, while sales in Egypt grew by 20% and GCC markets by 17%, Dabur India Group Director Mr. P D Narang said.
IRB Infrastructure Developers rose 2.65% to Rs 119.95 after the company said it has emerged as a preferred bidder and received letter of award from NHAI for the project of four laning of Yedeshi - Aurangabad section. The announcement was made after trading hours on Monday, 28 April 2014.
IRB Infrastructure Developers said that the company has emerged as a preferred bidder and received letter of award from National Highways Authority of India (NHAI) for the project of four laning of Yedeshi -Aurangabad section of NH-211 from km 100.000 to km 290.200 (Design Length 190 km) in the State of Maharashtra to be executed as BOT (Toll) on DBFOT Pattern under NHDP Phase -IV.
The estimated project cost of the company is approximately Rs 3200 crore, concession period is 26 years and construction period is 910 days, IRB Infrastructure Developers said in a statement. IRB Infrastructure Developers has sought Rs 558 crore as viability gap funding from NHAI, the company said.
IRB Infrastructure Developers' consolidated net profit fell 24% to Rs 108.52 crore on 4.3% decline in total income to Rs 905.91 crore in Q3 December 2013 over Q3 December 2012.
Wockhardt clocked a highest turnover of Rs 262.26 crore on BSE. State Bank of India (Rs 62.52 crore), Sterling Holiday Resorts (India) (Rs 61.43 crore), Adani Enterprises (Rs 55.84 crore) and UPL (Rs 44.53 crore), were the other turnover toppers on BSE in that order.
Unitech reported highest volumes of 1.10 crore shares on BSE. Sterling Holiday Resorts (India) (62.67 lakh shares), HCL Infosystems (40.90 lakh shares), Jain Irrigation Systems (39.36 lakh shares) and Wockhardt (32.76 lakh shares), were the other volume toppers on BSE in that order.
In the foreign exchange market, the rupee edged higher against the dollar. The partially convertible rupee was hovering at 60.4650, compared with its close of 60.6450/65 on Monday, 28 April 2014.
The country will likely get below-normal levels of monsoon rain this year, the India Meteorological Department (IMD) said on Thursday, 24 April 2014. The IMD said that the rainfall during the June-September summer rainy season will likely be 95% of the long-term average for the country. India's weather department defines a normal monsoon as one with rainfall between 96% and 104% of the 50-year average, which is 89 centimeters this year. This year could be a below normal monsoon, the weather department said, as there is a 60% possibility of the emergence of the El Ni weather phenomenona warm weather system that starts in the southern Pacific can affect weather around the world. El Ni last affected India's monsoon in 2009 when the monsoon rainfall was 23% below normal.
Annual rains are important for India as most of its farmlands are dependent or rain for irrigation and more than half of its workforce is employed in agriculture. The monsoon rains usually arrive over the southern state of Kerala by the end of May or the first week of June, and gradually cover the entire country by July. The IMD will issue the update forecasts in June 2014 as a part of the second stage forecast. Along with the update forecast, separate forecasts for the monthly (July and August) rainfall over the country as a whole and seasonal (June-September) rainfall over the four geographical regions of India will also be issued.
The Reserve Bank of India (RBI) next undertakes monetary policy review on 3 June 2014. The RBI left its main lending rate viz. the repo rate unchanged at 8% after a monetary policy review on 1 April 2014, as consumer-price inflation eased to a two-year low and as the rupee firmed up against the dollar.
A major near term trigger for the stock market is the outcome of the upcoming Lok Sabha elections. The 36 days long voting process began on 7 April 2014 and will conclude on 12 May 2014. The results will be declared on 16 May 2014 after which India will get a new government. The term of the current Lok Sabha expires on 1 June and the new House has to be constituted by 31 May.
European shares were higher on Tuesday as a slew of corporate earnings helped to buoy sentiment ahead of a policy meeting by the US Federal Reserve. Key benchmark indices in UK, France and Germany were up by 0.40% to 1.13%.
UK economic growth accelerated in the first quarter amid signs that the recovery is broadening beyond consumer spending. Gross domestic product expanded 0.8% from the final three months of 2013, when it grew 0.7%, the Office for National Statistics said today in London.
Euro-area economic confidence unexpectedly fell in April, increasing pressure on the European Central Bank as it considers unprecedented steps to avert the risk of deflation. An index of executive and consumer sentiment decreased to 102 from a revised 102.5 in March, the European Commission in Brussels said today.
Most Asian stocks edged higher on Tuesday as investors weighed corporate earnings. Key benchmark indices in China, Indonesia, Taiwan and Hong Kong rose 0.02% to 1.45%. Key benchmark indices in South Korea and Singapore were off 0.15% to 0.23%. Japanese markets were closed for a holiday.
Trading in US index futures indicated that the Dow could gain 44 points at the opening bell on Tuesday, 29 April 2014. US stocks rose, with the Standard & Poor's 500 Index erasing an earlier slide on Monday, 28 April 2014,, as Internet and smaller companies pulled back from a selloff amid optimism over merger activity.
A report by the National Association of Realtors showed contracts to purchase previously owned US homes climbed in March by the most in almost three years, showing residential real estate was starting to stabilize entering the spring selling season. The pending home sales index rose 3.4%, the first gain in nine months, after a 0.5% drop in February that was smaller than initially reported.
A two-day meet of the Federal Open Market Committee (FOMC) on monetary policy review resumes today, 29 April 2014. The Federal Reserve on 19 March 2014 decided after the conclusion of a monetary policy review to trim its monthly bond purchases by $10 billion to $55 billion.
Investors are also watching developments in Ukraine. The Obama administration imposed sanctions on seven Russian officials and 17 companies linked to Russian President Vladimir Putin's inner circle involved in banking, energy and infrastructure. The sanctions, announced by the White House, are being imposed in conjunction with the European Union, which said it is adding 15 names to its list of previously sanctioned individuals.
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