After three days of losses, the markets regained some strength today. After opening firm and gaining close to a per cent, the indices lost half of their gains by noon. The market rallied smartly in late trades to close at the day's highs. The volumes were very low and are at their lowest in the last five months. Sensex closed at 6466, up 68 points and the Nifty at 2027, up 19 points.

Among index stocks ICICI Bank, Satyam Computer and Tata Power were the biggest percentage gainers while Zee Tele, Wipro and VSNL were the major losers.

Yesterday, US markets drifted marginally down as investors are waiting for the first quarter results to come in. The Dow lost 13 points or around a tenth of a per cent while NASDAQ lost slightly more than a third of a per cent. After opening weak, crude oil futures gained close to a per cent to end at $53.71 to a barrel.

ADR's of Indian companies continued their down trend following the continued weak trend in IT stocks. Infosys lost close to 3 per cent while Wipro and Satyam lost around a per cent each. ICICI Bank lost more than 3 per cent while VSNL and HDFC Bank lost more than a per cent each. Dr. Reddy's and Tata Motors managed to close with gains.

Index of Industrial Production (IIP) grew by 4.9 per cent for the month of February 2005, according to the quick estimates released today. This is considerably lower than the 8.3 per cent growth for the same month last year and 7.5 per cent posted during January 2005. The sharp decline was mainly on account of a more than 2 per cent decline in mining as against a growth of more than 10 per cent posted by the sector last year. Among manufacturing sectors, textile was the star performer with a growth of over 24 per cent followed by paper and allied products.

The country's largest twowheeler manufacturer, Hero Honda, announced its results. While revenues for the full year increased by 30 per cent to Rs7563 crore, profits grew only by 15 per cent. For the last quarter profits actually declined as compared to the same quarter of last year indicating pressure on margins as a result of rising input costs. The company claim its market share has is above 50 per cent and is hopeful of maintaining double digit growth.

ICICI Bank has decided to tender the more than 10 per cent stake it holds in Crisil at the revised open offer price from Standard & Poor's. At Rs775 per share, ICICI would realise an amount of over Rs50 crore. The profits that would accrue to ICICI from the deal are not clear. ICICI Ventures, the bank's venture capital arm, is entering real estate investment with a $250 million fund which could eventually grow to $1 billion. The stock remained strong through out the day.

Telecom company VSNL has postponed the decision to de-merge its real estate assets into a separate company. Ratan Tata has resigned his chairmanship and Subodh Bhargava has been appointed chairman. Ratan Tata is reportedly taking direct control of the various telecom units of the group.

Bharti TeleVentures plans to increase its fixed line service coverage from the current six circles to 23 circles in the next one year. The company is targeting a customer base of 50 million in the next few years. The stock closed marginally lower.

Oriental Bank of Commerce is planning to merge Global Trust Bank into itself in the near future. The bank says, all customers of GTB have agreed to a debt settlement plan. The bank aims to wipe out the bad loans, which are currently at 1.7 per cent net of provisions, in a few years.

Larsen & Tubro received an order from the Bangalore Municipal Corporation for a water supply project. The order is worth around Rs180 crore. The stock closed with gains of close to a percent.

After remaining weak over the last few days on worries of lower future growth, IT stocks staged a comeback today. Infosys, TCS and Satyam made smart gains. Wipro closed lower by a per cent.

Mid-cap action
IT company Mphasis BFL reported better than expected results for the last quarter ended March 2005. Profits increased by 23 per cent while revenues were higher by 29 per cent as compared to the same quarter of last year. The company has declared a bonus issue in the ratio of one share for every share held and a final dividend of 30 per cent. The stock gained close to 20 per cent on the announcement of the results but lost part of its gains later in the day.

Essel Propack, the world's largest laminated packaging tubes manufacturer, announced plans to acquire UKbased Telcon Packaging in an all cash deal. The stock gained more than 3 per cent in morning trades.

Construction company IVRCL announced yet another major order from the Andhra Pradesh government. A joint venture, in which IVRCL holds around 35 per cent, has been awarded an irrigation project worth over Rs1,700 crore. The stock shot up over 5 per cent in early trades but could not hold much of its gains.

IT company Helios & Matheson is acquiring the vMoksha group of companies for $19 million. The deal covers the VMoksha companies in India, US and Singapore which together has over 500 employees. The stock gained over 8 per cent on this announcement.

The board of Bajaj Hindustan approved plans to raise $140 million by way of a GDR or FCCB issue. The stock gained over three per cent.

Champagne Indage, one of the largest manufacturers of wines in the country gained more than 5 per cent in early trades on reports that the investment arm of Reliance Energy has picked up close to 10 per cent in the company.

Jindal Photofilms, BEML and SSI were the biggest percentage gainers among mid-caps. Jindal Photo gained close to 20 per cent.

Prime Securities, Geodesic Info and Allahabad Bank were among the biggest percentage losers among mid-caps.

*Disclaimer: The author does not have any position in the stocks specifically mentioned above at the time of writing this article. This analysis / report is only for the purpose of information and is not an investment advice. Readers are advised to consult a certified financial advisor before taking any investment decisions. While efforts have been made to ensure the accuracy of the information provided in the content the author or publisher shall not be held responsible for any loss caused to any person whatsoever.

Other articles by Rex Mathew

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List of general reports on finance