Sensex ends 293 points higher; NTPC, M&M, Tata Power fall
08 September 2014
03:30 pm Market closing
The market made a spectacular comeback with hefty returns on Monday, at record closing high. The Sensex was up 293.15 points or 1 percent at 27319.85 and the Nifty was up 81.05 points or 1 percent at 8167.90. About 2067 shares have advanced, 962 shares declined, and 95 shares are unchanged.
Hindalco, ONGC, SBI, Wipro and HUL were top gainers in the Sensex. Among the top losers are NTPC, M&M, Tata Power and BHEL.
03:00pm Strong growth likely in domestic paint industry
The Associated Chambers of Commerce and Industry of India (ASSOCHAM), on September 4, said Indian paint industry is likely to surge from the current level of about Rs 40,600 crore to about Rs 62,000 crore by 2016 witnessing a breathtaking double-digit compound annual growth rate (CAGR) of about 20 percent.
The factors that have fuelled the paint industry's growth are the rise in disposable income and education, increasing urbanisation, development of the rural market and various launches of many innovative products, it added.
As per the ASSOCHAM recent report on 'Indian paint Industry: 2014' reveals that India is the second-largest consumer of paint in Asia. Top players include Asian Paints, Kansai Nerolac Paints, Berger Paints, AkzoNobel, Nippon Paints and Shalimar Paints, added the report.
Talleen Kumar, CEO & MD, Delhi Mumbai Industrial Corridor Development Corporation expects phase I of India's largest infrastructure project to be completed by 2019. This phase will involve construction of Dholera Special Investment Region in Gujarat and Shendra-Bidkin Industrial Park in Mahashtra. These two are part of the 8 smart industrial cities that have been planned along the length of the corridor.
Speaking to CNBC-TV18, Kumar said environment clearances for Dholera were in place, and that bidding process for both Dholera and Shendra would be rolled out in December this year.
Kumar said DMICDC has decided to go ahead with five cities in all, the other three being in Greater Noida, Madhya Pradesh and Haryana.
"In all these five cities, we have land available with us. The state government has been very proactive in making land available to us and that is the reason why we are able to move ahead in these five cities," he said.
Kumar admitted that land acquisition would turn out to be a major challenge for state governments as the project progressed.
"The land acquisition has been a challenging task for state government especially since the acquisition of the new Land Acquisition Act. We have to solve this problem if industrial cities have to come up," Kumar said.
02:20pm Sunflag Iron in News
Investors bought more shares of Sunflag Iron and Steel Company on the news of funds infusion by Japanese company. The stock rallied as much as 9 percent to hit a 52-week high of Rs 33.70 on the Bombay Stock Exchange, in addition to 10 percent upmove on Friday.
A meeting of the board of directors of the company will be held on September 11, to issue and allotment of 1,80,21,945 equity shares to Daido Steel Company, Japan on preferential basis, amongst others, said the company in its filing.
The Competition Commission of India, on August 27, had cleared the proposal of acquisition of 10 percent stake in company by Daido Steel Company.
"The overlap between products and vertical relationship between parties is insignificant and would not raise any competition concerns in India. Further, based on the total market value of the steel industry in India, the market shares of Daido and Sunflag are also insignificant," CCI explained.
02:00pm Equity benchmarks hit another record high in afternoon trade with the Nifty surpassing 8150 level, up 63.55 points to 8150.40 supported by banks, technology, FMCG and oil & gas stocks. The Sensex rose 212.58 points to 27239.28.
About 1992 shares have advanced, 902 shares declined, and 94 shares are unchanged.
India's largest lenders State Bank of India, ICICI Bank and HDFC Bank gained 0.9-1.6 percent while FMCG majors ITC and HUL advanced 0.8-1.3 percent.
State-run oil major ONGC remained on buyers' radar, up 2 percent after Bank of America Merrill Lynch upgraded the stock to buy from neutral as it expects more gains from oil reforms than earlier. "Main reason for our optimism is recent press reports which suggest equal subsidy sharing by ONGC-Oil India and the government. ONGC is better off under equal subsidy sharing than under the Parikh formula, which we were earlier assuming," the brokerage explains.
Technology majors TCS, Infosys and Wipro gained 0.8-1.3 percent. Deutsche Bank advises buying Wipro with a target price of Rs 650 and TCS with a target price of Rs 3,100. The brokerage recommends holding Infosys with target price of Rs 3,400.
However, HDFC, Mahindra and Mahindra, Tata Power and NTPC fell 0.7-1.6 percent.
1:30 pm FII view: In a very optimistic call, Jim Walker, MD, Asianomics expects the current bull run in Indian indices to continue till 2018. In an interview to CNBC-TV18, he says this is not the time to think about end of the bull run instead it is great time to buy into the market. On specific sectors, Walker finds value in industrial and cyclical stocks. He says the industrial midcap space holds the best value right now.
"I think you might be talking about 2017-2018 before this bull run is finished. We do have a global economy that is looking for growth and turns in the business cycle and India is providing that. I do not think we could be thinking about the end of the bull run anytime soon," he adds.
It's a strong day of trade on Dalal Street with the Nifty & Sensex scaling fresh highs. The Nifty is still trying hard to hit 8150. The 50-share index is up 47.85 points at 8134.70 while the Sensex is up 160.90 points at 27187.60. About 1905 shares have advanced, 888 shares declined, and 92 shares are unchanged.
ONGC, Bajaj Auto, Hindalco, HUL and HDFC Bank are top gainers in the Sensex while Maruti, M&M, Tata Motors and HDFC.
Tyre stocks like CEAT, Apollo Tyres and JK Tyres are on rampage today as rubber prices see sharpest fall in last 5 years. Rubber prices are down 25 percent since January average of Rs 169 per kg.
Gold prices were up by 0.27 percent to Rs 27,614 per 10 gram in futures trade as speculators enlarged positions amid a firming global trend. Analysts said the rise in gold prices at futures trade was mostly attributed to a firming trend overseas as speculators enlarged positions.
Poly Medicure, manufacturers of medical devices, won a 5-year long patent battle versus German firm B Braun. The European Patent Office (EPO) revoked two of B Braun's patents and Himanshu Baid, managing director of Poly Medicure, expects it to be a huge positive for the company.
He says the patent win will help the company gain a firm foothold in Europe. The patents are for intravenous safety catheters. The European safety catheter market is seen at USD 250 million. Baid believes with these patent wins, and given a 2-3 year horizon, the company can gain 6-7 percent market share.
12:45pm Venus Remedies on buyers' radar
Investors lapped up shares of Venus Remedies on tying up with Mylan for marketing antibiotic drug in three European countries. The stock gained 6 percent.
"This deal with Mylan, the world's third largest generic drug manufacturer, will enable Venus to market meropenem in Denmark, Sweden and Finland for a period of five years," said the company in its filing.
Venus will manufacture the drug at its Baddi facility, which recently got a renewed European Union Good Manufacturing Practices certification, while the batch release and logistics will be handled by its Germany facility Venus Pharma GmbH.
12:30pm Airtel in focus
Bharti Airtel has divested its African telecoms tower assets to Eaton Towers. The Indian telecom major has signed a 10-year contract to sell and lease back over 3500 towers to Eaton in six countries.
Under the sell and lease back, Bharti will rent back these towers from Eaton for its own operations. The company will get a lumpsum amount for the outright sell of towers, but every quarter it will have to pay some rental amount, which could eat into its EBITDA.
Overall the news is positive for Bharti Airtel as it will help in reducing its debt. The stock gained around 1.5 percent on the back of the news.
While the management has not made comments indicating the valuations of the deal, as per media speculation, it could be in the range of USD 800 million to USD 1 billion. Eaton Towers was advised by Moelis & Co.
12:15pm Tata Steel in News
Tata Steel has shut down its Noamundi mine in Jharkhand on the orders from the state government, sources told CNBC-TV18. The decision may come as a major blow to the company as the mine contributed over 30 percent of its iron ore requirements.
The Jharkhand government order follows the Centre's July 18 directive asking states to clamp down on mines operating under second or third deemed renewals.
The decision is likely to hit 12 out of the state's 17 operational iron ore mines, including those of SAIL, said media reports.
12:00pm The market remained on strong footing in noon trade with the Sensex jumping 177.40 points to 27204.10 and the Nifty rising 52.75 points to 8139.60. More than two shares advanced for every share declining on the BSE.
The stellar run of Indian indices is likely to continue, believes Gautam Shah, associate director and technical analyst, JM Financial. In an interview to CNBC-TV18, he says this bull market is here to stay and we are still in the first leg. For September, 7850 seems to be the new base for the Nifty, but it could hit 10,700 by December 2015, he adds. He expects Nifty to find minor resistance at 8,250.
Shares of ONGC, TCS, Reliance Industries, HDFC Bank, Sun Pharma, HUL, Bajaj Auto and Hindalco Industries topped the buying list, up 1-2 percent.
Shares of Tata Power, Tata Motors, Mahindra and Mahindra and Maruti Suzuki declined 0.3-0.8 percent.
11:45 am Buzzing: Investors continued to buy shares of Deepak Fertilisers and Petrochemicals Corporation (DFPCL) after its subsidiary formed joint venture for mining services in Australia. The stock gained as much as 4 percent intraday.
"Smartchem Technologies (STL), a subsidiary of DFPCL, as a part of its forward integration initiative, announced the launch of its overseas venture for Mining Services in Brisbane, Australia," said India's leading manufacturer of mining chemicals.
STL has set up Platinum Blasting Services Pty Ltd (Platinum), a joint venture with local Australian partners, who have vast experience in providing value added blasting services and operation expertise to the mining and explosives industries in Australia.
According to the press statement, STL will hold 65 percent while the local partners will hold 35 percent in the joint venture.
11:30 am Market outlook: The stellar run of Indian indices is likely to continue, believes Gautam Shah, associate director and technical analyst, JM Financial. In an interview to CNBC-TV18 he says this bull market is here to stay and we are still in the first leg. For September, 7850 seems to be the new base for the Nifty, but it could hit 10,700 by December 2015, he adds. He expects Nifty to find minor resistance at 8,250.
Going ahead, Nifty's upmove will be led by Bank Nifty, which may hit 18,700-19,000 levels in the near-term. He sees 15,300-15,500 as support levels for the banking index. Shah recommends retail investors to bet on midcap stocks via mutual funds because the space is moving with good momentum. On specific stocks, he is positive on oil and gas major ONGC.
Uptrend in the market continues with strong support from infra, oil & gas, metals and IT stocks. The Sensex is up 206.64 points or 0.76 percent at 27233.34 and the Nifty is up 55.95 points or 0.69 percent at 8142.80. About 1758 shares have advanced, 696 shares declined, and 79 shares are unchanged.
ONGC, Hindalco, HUL, Bajaj Auto and Sun Pharma are top gainers in the Sensex. Among the losers are Maruti, Tata Power, M&M and Tata Motors.
Goldman Sachs has raised Nifty's target to 9,000 points for September 2015. Its previous target was 8,600 points for June 2015. Goldman says earnings sentiment remains positive for the overall market.
The Reserve Bank of India was seen buying dollars via state-run banks to prevent further appreciation in the rupee. State-run banks started buying dollars aggressively likely on behalf of the central bank when the rupee hit around 60.20 levels, the strongest since July 30, traders said. The rupee strengthened after U.S. monthly jobs data on Friday was weaker than expected.
11:00am Market Expert
The stellar run of Indian indices is likely to continue, believes Gautam Shah, associate director and technical analyst, JM Financial. In an interview to CNBC-TV18 he says this bull market is here to stay and we are still in the first leg. For September, 7850 seems to be the new base for the Nifty, but it could hit 10,700 by December 2015, he adds. He expects Nifty to find minor resistance at 8,250.
Going ahead, Nifty's upmove will be led by Bank Nifty, which may hit 18,700-19,000 levels in the near-term. He sees 15,300-15,500 as support levels for the banking index.
10:45am IRB Infra bags order
IRB Infrastructure Developers said it has received the letter of award for the MSRDC's project of operation and maintenance of Yashwantrao Chavan Expressway and Mumbai Pune section of NH-4 along with execution of additional works on Mumbai Pune section of NH-4, on DBFOT basis with toll rights in the state of Maharashtra.
The final offer of the company for a concession period of 8 years 8 months and 2 days being the lowest amongst all the bidders has been accepted by MSRDC and thereby declared the company as selected bidder and issued the letter of award, it added.
10:30am Bharat Forge in News
Bharat Forge has divested its 50 percent stake in Impact Automotive Solutions, which was formed, earlier in 2010 as a JV with KPIT Technologies.
"The JV was formed for the manufacture of hybrid solutions for automotive. The stake was sold by the Company to the other JV partner, KPIT Technologies, for Rs 10.80 crore against an initial investment of Rs 14.91 crore, said the company in its filing.
10:20am Punj Lloyd at upper circuit
Shares of Punj Lloyd are locked at 10 percent upper circuit on bagging big RAPID Tank Farm order in Malaysia.
The diversified EPC giant announced winning the mega Rs 3,515 crore (USD 581 million) RAPID Tank Farm order from PRPC Refinery and Cracker Sdn. Bhd, a subsidiary under the Petroliam Nasional Berhad (Petronas) group, Malaysia's national energy company, said the company in its filing.
The Tank Farm is part of Petronas's Refinery and Petrochemical Integrated Development (RAPID) project (developed within a 6242-acre site) in Pengerang, Johor, Malaysia.
10:10am FII View
Rakesh Arora, Macquarie said GDP print of 5.7 percent, high auto and cement volume growth, and some hope of operating captive coal blocks to survive cancellation has uplifted the mood.
"Market will await final decision on coal blocks on September 9, to take further direction. A mass cancellation of coal blocks will have far reaching impact and all eyes on government on how fast they act," he added.
10:00am Equity benchmarks climbed to a new record high with the Sensex rising 200.64 points to 27227.34 and the Nifty gaining 54.60 points to 8141.45 supported by banks, oil & gas, technology and FMCG stocks.
The BSE Midcap and Smallcap indices advanced 0.5 percent and 1 percent, respectively. About three shares advanced for every share declining on the Bombay Stock Exchange.
ONGC topped the buying list, rising over 2 percent after Bank of America Merrill Lynch upgraded the stock to buy from neutral as it now expects more gains from oil reforms than earlier. "Main reason for our optimism is recent press reports which suggest equal subsidy sharing by ONGC-Oil India and the government. ONGC is better off under equal subsidy sharing than under the Parikh formula, which we were earlier assuming," the brokerage explains.
Shares of ITC, ICICI Bank, HDFC Bank, L&T, Reliance Industries, TCS, Infosys, HUL, Tata Motors, Sun Pharma and SBI gained 0.7-1.4 percent whereas Maruti, BHEL and Tata Power down 0.3-0.5 percent.
9:50 am FII view Jonathan Garner, Morgan Stanley says in the near-term, MSCI India appears fully valued and over-owned by dedicated EM funds. "On the macro side, the recent fiscal deficit figures appear encouraging. However, we need to see whether the government continues to work towards containing expenditure in the coming months as well. If the current trend continues, this will increase the probability that the government can achieve its lower fiscal deficit target of 4.1%, which otherwise seemed ambitious." he adds.
9:40 am Market check: The market has started the new week with fresh vigour after correcting for last two sessions. Both the benchmark indices are at life high. The Sensex is up 203.78 points or 0.75 percent at 27230.48, and the Nifty is up 54.00 points or 0.07 percent at 8140.85. About 1318 shares have advanced, 446 shares declined, and 58 shares are unchanged.
ONGC, GAIL, ITC, HUL and Hindalco are top gainers in the Sensex. Maruti is down arpund 0.6 percent.
9:30 am No buyback? Infosys management is not in favour of a buyback. CNBC-TV18 learns from sources that the IT major may treat its massive cash reserves as an asset and may look for M&A opportunities in new areas. Former Infosys executives V Balakrishnan, TV Mohandas Pai and DN Prahlad had sought Rs 11,200 crore (USD 1.83 billion) in the form of a buyback for all shareholders, concerned over the pace of change at India's second-biggest software services company.
However, sources say the Infosys management thinks that a buyback will send out very wrong signal. The management believes that it is better to actually use this cash on books as an asset for M&A. It may announce a dividend at a later date but at this point in time it is actively looking at M&A opportunities in newer areas.
The market has opened on a strong note. The Sensex is up 121 points at 27147.70, and the Nifty is up 46.10 points at 8132.95. About 567 shares have advanced, 112 shares declined, and 29 shares are unchanged.
GAIL, ONGC, Bharti Airtel, Sesa Sterlite and L&T are top gainers in the Sensex. Among the losers are Coal India, Wipro and Hero.
The Indian rupee opened at highest level since July 31. It has gained 10 paise at 60.29 per dollar against 60.39 on Friday.
Sterling slumped to its lowest in nearly 10 months on Monday amid worries about political uncertainty after an opinion poll showed supporters of Scottish Independence from Britain taking the lead for the first time since the referendum campaign began. It skidded nearly 1 percent.
Agam Gupta of Standard Chartered said, "Expect to see very strong nationalised bank demand between levels of 60.20-60.25/dollar. Expect Rupee to trade in a range of 60.20-60.40/dollar for the day. Exporters and FIIs likely to sell on upticks.''
In commodities, Brent crude slipped towards 100 dollars per barrel following weakness in US jobs data.