Indices maintain up trend as corporate results excite
20 January 2006
Markets opened on a very positive note, continuing the momentum from yesterday's huge rally. Recovery in US markets helped sustain the sentiment and major corporate results announced today were above expectations.
The Sensex crossed the 9550 mark in early trades, a gain of over 100 points from yesterday's closing levels. Selling pressure saw both the Sensex and Nifty paring most of their gains by noon.
Fresh buying in heavyweights like ONGC, HDFC, Maruti and ITC helped the indices to start a fresh rally in the afternoon. The up trend continued till the close of the day and the indices closed with healthy gains.
ABB was the biggest gainer among Nifty stocks as capital goods stocks attracted heavy buying interest on expectations of strong results. Siemens surged over 9 per cent after the company said its board would meet next week to consider a stock split. BHEL gained nearly 3.5 per cent.
L&T came under selling pressure and closed nearly 2 per cent lower after yesterday's spectacular rise.
Auto stocks had a fantastic day following encouraging results from Maruti. The stock closed nearly 7 per cent higher, making it the second best performer among Nifty stocks. Tata Motors gained over 3 per cent while Bajaj Auto closed nearly 2 per cent higher.
ONGC surged ahead today and was trading higher by almost 5 per cent at one point before closing over 3.5 per cent higher.
HCL technologies, ITC and BPCL were the other major gainers among index stocks.
Jet Airways lost 2 per cent as a section of analysts believe that the price paid by the company for Air Sahara is high.
Glaxo, Ranbaxy and Shipping Corp were the other major losers among frontline stocks.
Sensex closed at 9521, a gain of 71 points, and the Nifty at 2901, higher by 30 points. Nifty January futures closed at a discount of 7 points to the spot index.
US indices recovered yesterday after another set of technology numbers helped revive optimism about corporate profit growth. The quarterly numbers from ebay and AMD were better than expectations and helped erase the disappointment over Intel and Yahoo results announced on Wednesday.
The Dow closed one-quarter of a per cent higher while the S&P 500 index added more than 0.5 per cent. NASDAQ regained all the losses from Wednesday and closed one per cent higher.
Crude prices were on the boil once again yesterday on worries of fresh threats from terrorist network Al Qaeda. Concerns about supply disruptions were strong enough for the markets to ignore a rise in US oil inventory. February crude oil futures on the NYMEX closed at $66.83 per barrel yesterday. The commodity is trading well above the $67 mark in early European trades today.
December quarter results announced by ICICI Bank were better than consensus analyst estimates. Net profits increased 23.64 per cent to Rs640.08 crore as compared to Rs517.68 crore for the same quarter of previous year.
Interest income of ICICI Bank increased 50.67 per cent during the December quarter to Rs3,583.61 crore as compared to Rs2,378.36 crore. Treasury and fee income rose 32.38 per cent to Rs1.179.17 crore from Rs890.73 crore.
Maruti announced better than expected results for the December quarter. Net profits increased 41.45 per cent to Rs339.01 crore as compared to Rs239.66 crore for the prior year quarter. Net sales were higher by 7.8 per cent at Rs3,114.17 crore. Other income declined 16.38 per cent to Rs106.62 crore from Rs127.51 crore.
Total vehicle sales by Maruti during the latest quarter were higher by 7 per cent as compared to the same period of last year. The company said it has so far sold 40,000 units of newly launched premium hatchback model Swift. The company benefited from better cost management and higher price realisation during the quarter.
ITC has reported a net profit of Rs536.83 crore for the December quarter as compared to Rs448.94 crore for the prior year quarter. Total revenues for the quarter were at Rs2,604.92 crore as against Rs1,846.4 crore.
Satyam Computer has reported a sequential revenue growth of 9.43 per cent during the December quarter. Operating revenues for the quarter were at Rs1,223.63 crore as compared to Rs1,117.27 crore for the September quarter. Net profits for the quarter were at Rs493.08 crore, including a one-time income, as compared to Rs250.73 crore for the September quarter.
Satyam sold its entire balance stake in internet services company Sify during the quarter. The company realised a net income of Rs262.83 crore from the transaction which is reflected in the sharp jump in other income.
Satyam added more than 30 new clients and over 900 new employees on a net basis during the quarter. The company said the higher operating margins achieved during the quarter are sustainable. The company management has once again denied that talks were held with IBM for a stake sale.
Wipro is planning a 250-seat customer contact centre in Romania. Such a centre would help the company in targeting more clients in mainland Europe.
Mid-Cap Action
Mid-caps also maintained the uptrend today as stocks of companies which announced good results received buying support. Sugar stocks continued to surge today as well with some of them locked in upper circuits. The CNX Mid-Cap index gained 39 points and closed the day at 4224.
Sugar major Bajaj Hindustan has reported a net profit of Rs24.24 crore for the December quarter as compared to Rs10.19 crore for the prior year quarter. Total revenues for the quarter were higher at Rs293.9 crore as against Rs121.33 crore.
The board of Bajaj Hindustan has approved plans to set up a new sugar mill with a crushing capacity of 5,000 tonnes per day along with a 10 MW co-generation power plant. The company would also increase its power generation capacity by 120 MW to 270 MW.
Adlabs is planning to expand its multiplex network in Punjab. The company is considering movie and food complexes in most major cities of Punjab over the next few years.
