Sensex ends up 128 points; Ranbaxy & Sun Pharma rise 5-6%
28 Oct 2014
03:30 Market closing
The market ended with some smart gains as trading picked up pace in the last few hours. The Sensex closed up 127.92 points at 26880.82 and the Nifty was up 35.90 points at 8027.60. About 1509 shares advanced, 1371 shares declined and 111 shares were unchanged.
Sun Pharma was up 5 percent. Cipla, SBI, Tata Power and GAIL were top gainers in the Sensex. Among the losers are Hero MotoCorp, Bharti Airtel, HUL, Dr Reddy's Labs and Reliance.
03:20 pm Results
Power and automation technologies major ABB India missed street expectations on every parameter in third quarter of current calendar year 2014. Net profit rose by 25 percent to Rs 45 crore during the quarter from Rs 36 crore in the year-ago period.
"The company maintained a healthy double digit growth in profit on the back of improved execution, better productivity and continued savings from operational excellence initiatives while tight market liquidity conditions and high cost of capital continue to weigh on earnings," said ABB in its filing.
The company follows calendar year (2014) as its financial year.
3:00 pm Oil import
Hit by uncertainty over oil supplies from West Asia, India is keen to diversify its imports and wants to buy crude from the US, Oil Minister Dharmendra Pradhan has said.
The new strategy is being planned to guard against disruption in supplies from its biggest sources in the Middle East -- Iraq and Syria -- as they are caught in problems relating to Islamic State movement.
Asia's second-biggest energy user, which spent USD 143 billion on import of crude oil in 2013-14, wants the US to extend its policy of allowing gas exports to crude oil as well.
"I met officials from the US recently and asked them to allow oil exports to India. We are keen to import oil from the US, which currently does not allow oil exports," Pradhan told PTI. India wants to reduce its reliance on the Middle East nations for meeting its oil needs and instead wants to tap Latin American countries including Mexico and Russia.
02:30pm Interview
Sharad Sharma, Managing Director, State Bank of Mysore expects the public sector lender's NII growth to improve to 12-14 percent in the second half of FY15.
Speaking to CNBC-TV18 about the financial performance of the bank in the quarter gone by , he said that the bank is now focussed on retail growth and its net interest margin is stable at 3-3.1 percent.
The bank is looking at gross NPA of around 4 percent by FY15-end, he said. Further, there has been a steady reduction in slippages over last three quarters.
Meanwhile, the bank is not planning to move on rates in the next three months. Also, it has no merger plans in the foreseeable future, he added.
2:00 pm Market check: The market seems to have woken from slumber as the Sensex is up 118.66 points at 26871.56. The Nifty up 35.25 points at 8026.95. About 1364 shares have advanced, 1307 shares declined, and 123 shares are unchanged.
Ranbaxy is up 6 percent after reporting stellar Q2 results. Sun Pharma is up 5 percent, Cipla, GAIL, ICICI Bank and SBI are other gainers in the Sensex.
1:40 pm Earnings: Net profit of Lupin grew to Rs 630 crore in the second quarter ended September 2014. Its revenue jumped to Rs 3173 crore from Rs 2668 year-on-year. Formulations business was up 19 percent at Rs 2,799 crore, US gained 23 percent at Rs 1,272 crore, Europe was up 11 percent at Rs 87.6 crore and India grew 20 percent at Rs 799 crore on yearly basis.
1: 30 pm Results: Ranbaxy's Q2 net profit stands at Rs 478 crore versus loss of Rs 454 crore in a corresponding quarter last year. During the quarter, its revenue jumped to Rs 3260 crore from Rs 2,802 crore year-on-year. Its EBITDA was at Rs 807 crore while operating margin was at 24. 8 percent.
It is another day of sluggishness on Dalal Street as the benchmark indices do not make any remarkable gain. The Sensex is up 42.91 points at 26795.81 and the Nifty is up 14.95 points at 8006.65. About 1262 shares have advanced, 1295 shares declined, and 120 shares are unchanged.
GAIL, SBI, Sun Pharma, Tata Power and ICICI Bank are top gainers in the Sensex. Among the losers are Hero, Bharti Airtel, HUL, Bajaj Auto and Reliance.
Asian equities trade mixed. Investors tread cautiously ahead of the Federal Reserve meeting due to begin later today.
Brent crude extended its decline to a third day, dropping towards USD 85 a barrel, still under pressure from a Goldman Sachs report that slashed the investment bank's oil price forecasts amid a global supply glut.
Citing rising production and insufficient demand, Goldman Sachs on Sunday cut its forecast for Brent to USD 85 a barrel from USD 100 for the first quarter of 2015 and reduced its projection for US crude to USD 75 from USD 90.
Analysts from other major banks have also cut forecasts for 2014 and 2015 crude oil prices, citing global growth concerns, a strengthening dollar and ample supplies.
12:55pm Interview
Indiabulls Housing Finance reported a 21 percent growth at Rs 448.3 crore in net profit for the September quarter versus Rs 370.38 crore in the same period last year. Its core net interest income (NII) increased 14.3 percent to Rs 737.4 crore, while total income rose to Rs 1,518 crore from Rs 1,400 crore.
Gagan Banga, Vice Chairman & Managing Director of the company expects the company's gross NPLs to remain between 70 and 90 basis points and net NPLs to hover in 30-50 bps range. "We continue to remain liquid. We have over Rs 7,000 crore of cash which comes in extremely handy whenever the liquidity in the market dries up and this came to our advantage extremely useful last year between July and September. Going forward this will continue to remain an area of emphasis," he added.
Speaking about the company's operating performance, he said that one of the key developments in the quarter was that the company's credit rating got upgraded to AAA. Also, it has invested in strengthening the overall board of directors, he said.
12:30pm JSW Steel
Shares of JSW Steel fell over 2 percent in the backdrop of the CBI registering a Preliminary Enquiry (PE) against unknown officials of the company over alleged diversion of forest land for a mining project in Jharkhand.
The CBI had yesterday registered a PE against unknown officials of JSW Steel Private Limited and the Ministry of Environment and Forests over alleged diversion of forest land
for a mining project in Jharkhand.
Sources in the CBI said the clearance for the project for mining in Ankua reserve forest was given in 2013.
The allegation made by the CBI in the PE was that unknown officials of JSW and the Ministry of Environment and Forests entered into a criminal conspiracy for getting approval for this mining activity, reports PTI.
A JSW spokesperson, when asked to comment on the CBI move, had said yesterday, "We are not aware of any such move nor have we received any official communication to this effect."
12:00pm Market Check
The market gave up some early gains to trade marginally in the green. Banks continued to gain today while energy and metal stocks lost ground.
The Sensex advanced 44.15 points to 26797.05 and the Nifty rose 14.50 points to 8006.20. About 1215 shares have advanced, 1216 shares declined, and 128 shares are unchanged.
Lupin traded more than 1.5 percent lower ahead of it's second quarter earnings today. A CNBC-TV18 poll expects a 23 percent revenue growth and a 36 percent rise in profitability. However, Ranbaxy gained 1.5 percent as analysts expect a 3 percent revenue growth led by the launch of Diovan generic during the quarter.
Tech Mahindra, Force Motors, SBI, RS Software, DLF, Reliance Industries, TCS and Infosys were the most active shares on exchanges.
Software solutions provider Tech Mahindra climbed over a percent ahead of earnings (on Wednesday). Analysts expect the company to report a 15.5 percent growth in profit while dollar revenue may report a 3.83 percent sequential growth at USD 888 million during the quarter.
11:50 am Buzzing: Shares of State Bank of Mysore rallied as much as 19.3 percent intraday after it reported a 3.4 times jump (year-on-year) in net profit in July-September quarter. Profit increased to Rs 102 crore (from Rs 30.1 crore) on the back of low base in Q2FY14, higher other income and lower provisions. Profit was down 79.3 percent Y-o-Y to Rs 30.1 crore in Q2FY14 on big spike in provision (up 181 percent). Provisions declined 32.3 percent on yearly basis to Rs 216.6 crore in the quarter gone by while other income (non-interest income) jumped 39.3 percent to Rs 181.73 crore and operating profit grew by 27.6 percent to Rs 347.4 crore during the same period.
11:30 am Result analysis: Though HUL shares suffered a knee-jerk reaction (fell 5 percent on Monday) just after it announced its July-September quarter, analysts are not negative on it yet. The stock lost 2 percent intraday on Tuesday. Maintaining neutral rating Credit Suisse says HUL's EBITDA margin expanded 50 basis points (bps) year-on-year despite a sharp 160 bps fall in gross margins, as advertising spend came down due to competitive intensity being benign.
"The fall in gross margins was unexpected and was driven by a low base for raw material costs and higher excise duty. With softening commodity prices now only starting to kick in, we expect gross margins to start improving from Q3," it said in a note.
The Nifty holds 8000 amid consolidation. The 50-share index is up 8.75 points at 8000.45. The Sensex is up 35.30 points at 26788.20. About 1203 shares have advanced, 1065 shares declined, and 107 shares are unchanged.
GAIL, Sun Pharma, ICICI Bank, SBI and Cipla are top gainers in the Sensex. BHEL, HUL, Hero Moto and Reliance are among the losers.
Brent crude extended its decline to a third day, dropping towards USD 85 a barrel, still under pressure from a Goldman Sachs report that slashed the investment bank's oil price forecasts amid a global supply glut.
Citing rising production and insufficient demand, Goldman Sachs on Sunday cut its forecast for Brent to USD 85 a barrel from USD 100 for the first quarter of 2015 and reduced its projection for US crude to USD 75 from USD 90.
Analysts from other major banks have also cut forecasts for 2014 and 2015 crude oil prices, citing global growth concerns, a strengthening dollar and ample supplies.
Gold recovered after falling to its lowest in nearly two weeks on Tuesday as investors nervously awaited a US Federal Reserve meeting that begins later in the day for clues about the timing of any interest rate hike.
Globally, Asian equities are mixed as volatile oil prices and caution ahead of the start of the second day of FOMC meet weigh.
10:55am Earnings impact
Indiabulls Housing Finance gained 0.5 percent on the back of a steady quarter with a NII growth of 14.3 percent at Rs 737.4 crore and a profit growth of 21 percent to Rs 448.3 crore in Q2. UBS increased its estimates for FY15e / FY16e by 2 percent and 1 percent and upped the target price to Rs 450.
Lakshmi Machine Works fell 4 percent as the company reported a slightly disappointing quarter with a 5 percent revenue growth and a profit drop of 10 percent due to exceptional cost incurred on account of compensation for VRS opted by employees. The textile machinery division reported an EBIT drop of 15.6 percent year-on-year.
10:30am Market Expert
Gautam Shah, associate director & technical analyst, JM Financial seems extremely bullish on Indian equities. Speaking to CNBC-TV18, he said that Indian equities have been resilient as there has not been even a 10 percent correction in the last 14 months. ''This market has seen only time correction and no real price correction. The market set-up continues to be very constructive and the bull trend is definitely intact. So, these dips are healthy for the Nifty to continue its upmove,'' he added.
Continuing his positive tone, he said that 8,050 level is short-term resistance for the Nifty and it is likely to hit new record high once this level is breached. Further, he sees the benchmark at 8,700-8,800 by this year-end.
Interestingly, October is a poor month for the Nifty historically, but this time the market has defied history and performed well, he said. However, sentiment and trends for the Nifty are usually upbeat in November and December.
Shah is also upbeat on the Bank Nifty. He has a near-term target of 17,000 for the banking index and eventual target of 19,000.
10:00am Market Check
Equity benchmarks maintained early gains with the Sensex rising 82.79 points to 26835.69 and the Nifty climbing 23.75 points to 8015.45. The broader markets gained marginally too with the BSE Midcap and Smallcap indices advancing 0.4-0.5 percent.
About 1118 shares have advanced, 675 shares declined, and 69 shares are unchanged on the Bombay Stock Exchange.
Sun Pharma, SBI, ICICI Bank, Gail India, Wipro, Zee Entertainment and Tech Mahindra toppped the buying list with 1.5-2 percent gains followed by L&T, HDFC, Tata Motors, Cipla and Wipro with one percent upside.
However, Bharti Airtel, BHEL, Hero Motocorp, HUL, Reliance Industries, Lupin and Jindal Steel declined 1-3 percent.
State Bank of India's subsidiaries rallied sharply post strong profit numbers in Q2 by State Bank of Mysore (SBM). SBM rallied 15.5 percent as profits surged 3.4 times to Rs 102 crore from Rs 30.1 crore Y-o-Y on the back of lower provisions. The bank reported a 5 percent jump in net interest income at Rs 513.6 crore and asset quality trends were stable.
State Bank of Travancore gained 9.31 percent and State Bank of Bikaner and Jaipur rose 8.09 percent.
HMT gained for the second consecutive session, up 11.70 percent in addition to 20 percent rally in previous session. Indian Hotels spiked 7.06 percent while Astral Poly Technik, Lakshmi Machine, Hindustan National Glass, Kajaria Ceramic and Jubilant Foodworks lost 2.5-5 percent.
9:50 am FII view: Gautam Chhaochharia, UBS says consumer staples/discretionary and autos have done well in anticipation of pent-up demand led consumption recovery, especially in the context of the October festive season. However, we expect disappointment in the near term, he adds.
''Our top-down view is that the consumer and auto sectors' risk-reward profiles are relatively unattractive. We are underweight on consumers and 2-wheelers and our least preferred stocks include United Spirits, HUL and Hero Motocorp. Some stocks may still meet expectations or even surprise positively. We prefer Maruti Suzuki, Titan and Asian Paints,'' says Chhaochharia.
9:30 am Poll: Nestle India, which is engaged in the food business, is expected to report a 10.9 percent growth in third quarter profit at Rs 316 crore compared to Rs 285 crore in the year-ago period, according to the average of estimates of analysts polled by CNBC-TV18. Numbers will be announced today and the company follows calendar year 2014 as its financial year.
Total income from operations may increase 10.3 percent to Rs 2,603 crore in the quarter ended September 2014 compared to Rs 2,360 crore in corresponding quarter of last fiscal.
Operating profit during the quarter is likely to jump 7.8 percent on yearly basis to Rs 532 crore but margin may decline 50 basis points to 20.4 percent.
After some profit taking yesterday, the market has opened higher on Tuesday. The Sensex is up 66.07 points at 26818.97 and the Nifty is up 10.70 points at 8002.40. About 354 shares have advanced, 121 shares declined, and 29 shares are unchanged.
L&T, ICICI Bank, ONGC, Bharti Airtel and TCS are top gainers in the Sensex. Coal India, Infosys, HUL, Hindalco and Hero are among the laggards.
The Indian rupee opened flat at 61.33 per dollar versus 61.31 Monday.The US dollar nurses modest losses, on expectations of more dovish comments from the Federal Reserve.
Agam Gupta of Standard Chartered said, "We do not expect rupee to dip below Rs 61.20/dollar due to demand from nationalised banks at that level. The range for the day could be Rs 61.20-61.45/dollar. We expect exporters to sell above Rs 61.40/dollar.''
In the US, stocks closed little changed, after the market's best week of the year, as investors tracked the cost of crude as a proxy for the health of the global economy and sorted through quarterly earnings.
It is an important week for the US markets, as the Federal Reserve will begin its 2-day policy meeting today. The fed is expected to end its 3rd round of bond buying and the investors will look for clues on timing of rate hike.
European stock markets closed lower after a closely-watched German economic report came in weaker than expected, putting the brakes on a relief rally over the results of a key health check on the region's banks. German business sentiment hit its lowest level in almost two years.
In commodities, Brent crude slipped to USD 85 per barrel as Goldman Sachs cut its 2015 outlook for oil prices, saying it expects Brent crude to drop to USD 85 a barrel in the first quarter of 2015. From precious metals space, gold prices slipped to USD 1220 an ounce ahead of FOMC meeting.