Sensex ends above 26k; Bharti up 5%, Maruti & Axis fall
22 Jul 2014
03:35 pm Market closing
After a blockbuster ride, the market ended on a strong note, marking second highest closing level ever. The Sensex ended above 26,000 for second time, up 310.63 points or 1.21 percent at 26025.80 and the Nifty was up 83.65 points or 1.09 perent at 7767.85. About 1466 shares advanced, 1497 shares declined, and 114 shares were unchanged.
Bharti Airtel soared 5 percent, while Reliance, HDFC, TCS and Hindalco were top gainers in the Sensex. L&T, Maruti, BHEL and Axis Bank were major losers.
03:20 pm Rail Infra push
The government is planning to offload its stake in certain profit-making infrastructure companies of Indian Railways, a move that will help such companies to get listed on stock exchanges as well as raise funds for exchequer.
"We are in talks with the Railway Board for sale of government equity in certain PSUs managed by Indian Railways, a source told PTI.
There are about half a dozen companies which are managed by Indian Railways. These include RITES, IRCON, IRFC, IRCTC, and RailTel Corporation. Since these companies are not listed it is likely that the initial public offer (IPO) will be accompanied by government offloading its stake.
Indian Railways, which is facing cash crunch, is looking at various ways to mobilise resources for undertaking its expansion programme.
03:10 pm European Markets
European markets rode a global rebound in risk appetite helped by the first signs of cooperation from Ukraine's pro-Russian separatists over the downed Malaysian Airlines plane.
After days of uncertainty, a train carrying the remains of some of the almost 300 victims was heading for Ukrainian government territory and flight recorders had been passed to Malaysian authorities by separatist leaders.
It helped settle the recent market nerves, lifting shares both in Europe and Asia and pushing back many safe-haven assets like the yen, gold and government bonds that have been in demand over the last week.
03:00pm Market Check
The Sensex shot up 277.57 points or 1.08 percent to 25992.74 and the Nifty rose 71.90 points or 0.94 percent to 7756.10. About 1371 shares have advanced, 1518 shares declined, and 122 shares are unchanged.
02:50pm Kansai Nerolac Paints surges 7%
Kansai Nerolac Paints reported 19.77 percent increase year-on-year in standalone net profit at Rs 72.98 crore for the first quarter ended June 30.
Net sales during Q1, 2014-15 were at Rs 921.07 crore, an increase of 16.61 percent as compared to Rs 789.81 crore in the year-ago period. Overall expenses during Q1 stood at Rs 823.17 crore, up 16.63 percent as against Rs 705.75 crore in the same quarter last year.
02:40pm Asian Paints Q1 earnings
Asian Paints, one of the largest paint companies in India, reported slightly better-than-expected earnings in first quarter (April-June) of current financial year 2014-15. Consolidated net profit grew 23.2 percent on yearly basis to Rs 338.7 crore and total income jumped 19.3 percent to Rs 3,362 crore from Rs 2,818 crore year-on-year.
According to CNBC-TV18 poll estimates, analysts had expected the company to report net profit of Rs 333 crore on revenue of Rs 3,330 crore for the quarter.
02:30pm Brokerage on Thermax
Barclays said first quarter results of Thermax were a miss and order inflows were weak. The company continued to report losses at its subsidiaries while its standalone margin impacted by higher material costs.
The brokerage house retains underweight rating on the stock with a target price of Rs 512 a share.
02:20pm Tata Coffee falls 2.5%
Tata Coffee's first quarter (April-June) consolidated net profit dropped by Rs 10 crore at Rs 30.3 crore compared to same quarter last year while total income slipped to Rs 374.5 crore from Rs 418.5 crore during the same period.
Operating profit dropped significantly to Rs 80 crore from Rs 103 crore and margin declined 300 basis points to 21.5 percent in the quarter gone by.
02:10pm Telecom stocks active
The telecom space continued to buzz after the Telecom Regulatory Authorities of India (TRAI) permitted spectrum sharing among telecom service providers across all six frequency bands.
Rohit Chordia, Senior Telecom Analyst at Kotak Institutional Equities told CNBC-TV18 that the move will bolster faith in quality operators like Bharti Airtel and Idea Cellular. Both Idea as well as Bharti Airtel is slated to explore the payment bank option route and Chordia believes it is justified considering the reach these two companies have among unbanked population.
Idea, meanwhile, has Idea has posted stellar Q1 numbers and brokerages have raised 12-month target of the stock.
02:00pm The market is on strong footing in afternoon trade supported by telecom, technology, FMCG, healthcare, HDFC twins and oil & gas stocks. However, banks and capital goods stocks are under pressure.
The Sensex rose 186.21 points to 25901.38 and the Nifty rallied 42.60 points to 7726.80 but the broader markets erased gains. About 1349 shares have advanced, 1473 shares declined, and 117 shares are unchanged.
Bharti Airtel, Reliance Industries, Hindalco, HDFC and Tata Motors are prominent gainers, up 2-5 percent whereas Maruti Suzuki, Power Grid Corporation, PNB, L&T, Bank of Baroda, ICICI Bank, Tata Steel and BHEL lost 0.5-1.5 percent.
Among midcaps, Thermax plunged over 8 percent post a 18 percent fall in Q1 bottomline. Suzlon Energy, IRB Infra, Syndicate Bank and Jaypee Infra lost 3-5 percent while Kansai Nerolac, Novartis India, HMT, Tilak Finance and DB Realty gained 5-6 percent.
1:50 pm Market opinion: GEM funds are overweight on India and have been raising their rating in India constantly, says Jyotivardhan Jaipuria of Bank of America Merill Lynch (BofAML) in a reseach note.
Investors are gung-ho on the Indian growth story and believe that this market stands out amongst the EM universe. However, future FII flows may be driven by global funds that are not as heavily positioned in India, it adds.
Over the past two weeks, the brokerahe house met with nearly sixty investors with practically every investor has a bullish stance on Indian equities.
"There was practically no debate on our view that re-rating would drive markets to our year-end target of 27,000. Near term, some investors agreed that we could see a slight pullback on global concerns and a possible monsoon failure; but most wanted to buy the dip," it says.
1:40 pm Houseview: Bank of America Merrill Lynch has raised target price of Exide Industries to Rs 183, implying 9 percent upside, driven by a 4 percent upgrade in EPS for FY15e and FY16e and assumption of a higher price to equity ratio. Shares of Exide surged 8 percent, touching 3-year high at Rs 170.
The battery manufacturer surpassed street expectations on every parameter with the first quarter (April-June) net profit rising by 16 percent on yearly basis to Rs 185 crore. Revenue surged 17.5 percent to Rs 1,912.4 crore in June quarter compared to Rs 1,627.5 crore in corresponding quarter of last fiscal.
BoA ML is expecting sales to grow by 13.8 percent in FY15e, 18 percent in FY16e and 17 percent in FY17e.
1:30 pm Buzzing: Shares of Thermax, an energy and environment solutions provider, fell as much as 6.7 percent intraday after the company's first quarter earnings disappointed street on every parameter.
Net profit in April-June quarter slipped 17.7 percent to Rs 41.4 crore year-on-year on account of lower revenue and weak operational performance despite strong other income while revenue declined 2.7 percent to Rs 839.4 crore in June quarter compared to Rs 863 crore in same quarter last year due to lower order book.
Analysts had expected the company to report net profit of Rs 58.8 crore on revenue of Rs 931 crore for the quarter.
It's a strong day for the market with the Nifty hovering around 7750 levels. The Sensex is up 248.90 points at 25964.07 and the Nifty is up 65.55 points at 7749.75. About 1536 shares have advanced, 1190 shares declined, and 118 shares are unchanged.
Index heavy weights like Bharti Airtel and Reliance Industries lead the market higher. L&T, ICICI Bank, Tata Steel, Bajaj Auto and Maruti are top losers in the Sensex.
Sources suggest that there could be some amendment in the finance bill. The government is likely to offer some relief to the debt mutual funds with tax relief being under active consideration.
According to a CNBC-TV18 poll, Axis Bank may report a 14 percent net interest income growth led by 15-20 percent loan growth. Net interest margins may contract sequentially, could see higher slippages this quarter.
12:55pm Sensex eyes 26000
The market is on strong footing with the Sensex rising 249.21 points or 0.97 percent to 25964.38 and the Nifty gaining 64.10 points to 7748.30.
About 1536 shares have advanced, 1164 shares declined, and 118 shares are unchanged.
12:50pm Thermax Q1 disappoints
Thermax disappointed street with the first quarter (April-June) net profit falling 17.7 percent on yearly basis to Rs 41.4 crore from Rs 50.3 crore and revenue declining 2.7 percent to Rs 839.4 crore.
According to CNBC-TV18 poll estimates, analysts had expected the company to report net profit of Rs 58.8 crore on revenue of Rs 931 crore for the quarter.
12:40pm Readymade Steel India on buyers' radar
Kridhan Infra (formerly known as Readymade Steel India), specialised in pile foundations, has bagged four contracts totally valued at Rs 116 crore (Singapore 24.15 million) from Singapore's Housing development Board.
With this, Kridhan, which bagged these contracts through its subsidiary KH Foges Pte Singapore, has now set its strong foothold across all sections of infra projects from high end infrastructure to residential projects and commercial projects.
12:30pm Telecom stocks in focus
Shares in telecom operators gain after Idea Cellular's April-June profit beat estimates and after the sector regulator issued guidelines for mobile phone spectrum sharing between carriers that is seen benefiting the bigger incumbents, reports Reuters.
Idea Cellular's shares jumped after first-quarter profit rose 57 percent year-on-year to Rs 728 crore (USD 120.8 million), beating consensus estimates due to a rebound in voice as well as data realisations without any pressure on volumes, traders say.
Spectrum sharing can be useful for big operators that are either facing or could face network capacity issues, analysts say.
Idea Cellular is up 5 percent, Bharti Airtel is up 5 percent while Reliance Communications in up 1.8 percent.
12:20pm Interview
Strides Arcolab has bought a partial stake in Bafna Pharma for Rs 48.1 crore and this money will be used to pare the debt and grow the export market, says Bafna Mahaveer Chand, chairman and managing director, Bafna Pharma.
Speaking to CNBC-TV18, Chand says the joint venture (JV) will aid Raricap- the company's flagship brand's- annual sales.
Bafna and Strides have a deal under which the India branded generics business of Bafna will be transferred to a special purpose vehicle (SPV) in which Strides will hold 74 percent stake while 26 percent will be held by Bafna.
12:10pm FII View
Arindam Ghosh, MD & CEO, Blackridge Capital Advisors believes market should correct another 5-10 percent in the near-term to become more attractive and the valuations a lot more supportive. According to him, if the market consolidates around 8-10 percent, it is a good entry point.
In an interview to CNBC-TV18, Ghosh says there is lot of excitement and buzz in the Indian market currently due to support from global markets, improved macros and an outstanding Budget, will give the necessary push for infrastructure and manufacturing,
"Monsoon was a big threat and the fears have, to a certain extent, started to receipt with a pickup in monsoon, but we will have to wait and see how it actually plays out over the course of the next two months,'' he adds.
12:00pm Equity benchmarks remained strong in noon trade with the Sensex rising 201.85 points to 25917.02 and the Nifty jumping 55.25 points to 7739.45 supported by HDFC twins, telecom, oil & gas and healthcare stocks.
About 1499 shares have advanced, 1086 shares declined, and 116 shares are unchanged.
Reliance Industries, Bharti Airtel and Hindalco Industries topped the buying list, up 2-4 percent followed by HDFC, HDFC Bank, Tata Motors, Dr Reddy's Labs, Coal India and Sun Pharma with 1-1.7 percent. Cigarette major ITC and top software services exporter TCS climbed 0.5 percent each.
Asian Paints gained more than 2 percent ahead of Q1 earnings. According to CNBC-TV18 poll estimates, analysts expect consolidated profit after tax to rise 20.9 percent on yearly basis to Rs 333 crore and total income to grow 18.2 percent to Rs 3,330 crore during the quarter. They also expect volume growth to remain robust in Q1 (forecast of 11-12 percent growth) and 6-7 percent benefits from the pricing mix will boost revenue of the company.
However, ICICI Bank, L&T and Bajaj Auto were only losers in the Sensex.
11:50 pm Poll: Private sector lender Axis Bank will announce its first quarter (April-June) earnings today. According to CNBC-TV18 poll estimates, analysts expect profit after tax of the bank to rise 21 percent to Rs 1,703 crore during the quarter compared to Rs 1,409 crore in same quarter last year, which may be supported by mark-to-market gains.
Net interest income, the difference between interest earned and interest expended, may increase 14.3 percent to Rs 3,276 crore in June quarter as against Rs 2,865 crore in the year-ago period due to 15-20 percent loan growth. In last quarter of previous financial year 2013-14, loan business grew 17 percent Y-o-Y with retail up 33 percent and corporate increasing 4 percent. Within retail auto loans jumped 20 percent on sequential basis.
11:40 pm Interview: Ramesh Abhishek, chairman, Forward Market Commission, said the regulator is glad that finally the FTIL divestment in MCX has happened as per its 'fit and proper' order. Going ahead he feels the market has an important role to play in the price discovery and hedging issues. Abhishek said FMC is working towards making the warehousing and forward market strong. The regulator wants to make functioning of warehouses transparent and want to adopt third-party audit. ''We are working closely with NSEL to repay money to borrowers,'' he added.
11:30 pm Boardroom: One of the Indian telecom giant, Idea reported a strong set of numbers in Q1FY15 with a big beat on revenues and margins. The company exceeded street's expectations on every front with the consolidated net profit rising 23.4 percent sequentially to Rs 728 crore in April-June quarter aided by strong operational performance and topline despite higher tax rate. Managing director Himanshu Kapania is very bullish on the Indian telecom industry.
In an interview to CNBC-TV18, he said revenue and non-voice revenue along with its focus on cost efficiency is aiding the company's margin performance. ''Around 45 percent of absolute revenue growth goes into margins,'' he added.
11:20 pm Market outlook: The Nifty is likely to hit 8000 by December amid intermittent correction andconsolidation, feels Tirthankar Patnaik, India Strategist and Chief Economist at Religare Capital Markets. Near term, he sees a higher probability of consolidation than an uptrend.
In an interview with CNBC-TV18, he said he expected corporate earnings to grow around 15 percent each for this fiscal and the next. For the June quarter, he expects cement, energy and capital goods to report good numbers. He is positive on the metals sector going forward, citing an improvement in macro-economic data from China.
The market continues its uptrend supported by oil & gas and metals. The Sensex is up 189.14 points at 25904.31 and the Nifty is up 51.65 points at 7735.85. About 1514 shares have advanced, 922 shares declined, and 96 shares are unchanged.
Bharti Airtel, Reliance, Coal India, Hindalco and Sterlite are top gainers in the Sensex. Among the losers are Bajaj Auto, HUL, ICICI Bank, GAIL and Axis Bank.
Foreign investors bought shares worth USD 26.73 million on Monday, a fourth straight day of purchases.
Crude oil futures rose to Rs 6,237 per barrel today as speculators created positions on a firming trend in the Asian region. At the Multi Commodity Exchange, crude oil prices for delivery in August traded higher by Rs 47,to Rs 6,237 per barrel, with a business turnover of 1,846
lots.
Crude oil prices for April were also up by a similar margin to Rs 6,212 per barrel with a business volume of 57 lots. Marketmen said the rise in crude oil futures was largely in tandem with a firming trend in Asian trade on geopolitical tensions.
11:00am Market Update
The market extended rally with the Sensex rising 201.10 points to 25916.27 and the Nifty soaring 55.40 points to 7739.60. About 1497 shares have advanced, 752 shares declined, and 89 shares are unchanged.
Petrochemical major Reliance Industries jumped further, up 2.5 percent on top of a 2 percent gains in pervious session post Q1 earnings. HDFC and HDFC Bank climbed 1 percent each while ITC and ONGC rose 0.8 percent each.
10:50am Earnings expectations
Asian Paints, one of the largest paint companies in India, will announce its first quarter (April-June) earnings today. According to CNBC-TV18 poll estimates, analysts expect consolidated profit after tax to rise 20.9 percent on yearly basis to Rs 333 crore and total income to grow 18.2 percent to Rs 3,330 crore during the quarter.
Operating profit may rise 20 percent to Rs 530 crore in June quarter compared to Rs 442 crore in same quarter last year and margin may expand 20 basis points to 15.9 percent in the quarter gone by.
10:40am Hitachi Home on buyers' radar
Hitachi Home shot up nearly 6 percent after its first quarter net profit treble to Rs 43 crore from Rs 14.2 crore in same quarter last year.
Net sales increased to Rs 596 crore in June quarter compared to Rs 468.7 crore in the year-ago period.
10:30am Commex Technology in News
Commex Technology, which has significant stake in Universal Commodity Exchange (UCX), says due to prevailing market conditions, trading activities of the UCX suspended temporarily till such time a renewed plan is put in place.
10:20am FII View
Neelkanth Mishra, Credit Suisse said, ''The Indian market has re-rated sharply and in recent meetings we have found many investors uncomfortable with the MSCI India one-year forward P/E of 16.3x, particularly as India's premium to other emerging markets (EMs) is near a five-year high. ''We find the comparison with other EMs as a basket inappropriate,'' he added.
He further said Credit Suisse thus believes that even if the pace of change driven by the new government disappoints consensus as it expects, the market should still do well.
''Sectors with robust earnings growth like NBFCs, discretionary, autos, IT and pharma should drive the upside while PSU banks and late-cycle industrials, driven by hope, may lag,'' he added.
10:10am Interview
Idea Cellluar, managing director Himanshu Kapania is very bullish on the Indian telecom industry. In an interview to CNBC-TV18, he said revenue and non-voice revenue along with its focus on cost efficiency is aiding the company's margin performance. ''Around 45 percent of absolute revenue growth goes into margins,'' he added.
As per VLR data, Idea's total subscriber base in India is 791 million.
Meanwhile, sharing views on TRAI's recent spectrum recommendations, he said, spectrum sharing is not entire solution for telcos' needs.
10:00am Equity benchmarks maintained early gains with the Sensex rising 132.15 points to 25847.32 and the Nifty gaining 37.05 points to 7721.25. The broader markets gained too with the BSE Midcap and Smallcap indices climbing 0.7 percent each.
About 1342 shares have advanced, 617 shares declined, and 68 shares are unchanged.
Top telecom operator Bharti Airtel shot up over 5 percent after its rival Idea Cellular reported stronger-than-expected quarterly earnings in June quarter. Consolidated net profit of Idea jumped 23.4 percent sequentially to Rs 728 crore in April-June quarter aided by strong operational performance and topline despite higher tax rate. Bharti will announce its Q1 earnings on July 29.
Index heavyweights Reliance Industries, ITC and HDFC Bank rose 0.5-1.5 percent. Aluminium major Hindalco Industries and top coal mining company Coal India rallied over 1.5 percent.
However, ICICI Bank, Infosys, HDFC, Wipro and Gail were only losers in the Sensex.
10:00 am Houseview: Shares of Idea Cellular jumped 5 percent intraday buoyed up by its April-June quarter earnings. Brokerages including CLSA have upgraded the stock as the telecom operator's consolidated net profit rose 23.4 percent sequentially to Rs 728 crore in April-June quarter aided by strong operational performance and topline despite higher tax rate.
CLSA has upgraded the stock to underperform from sell and increased FY15-17 Ebitda estimates by 9-11 percent mainly led by higher data traffic. Its consolidated revenue grew 7.34 percent to Rs 7,561 crore in the first quarter compared to Rs 7,043.8 crore in same quarter last year. However, it is still concerned about Idea's refarming risks and bunched-up renewals.
9:50 am Maruti's marekt share: Country's largest carmaker Maruti Suzuki India continues its dominance on the Indian roads with its four models, led by entry level small car Alto heading the top ten best sellers list in April-June quarter this fiscal.
According to Society of Indian Automobile Manufacturers (SIAM) data, the company's Dzire, Swift and WagonR were the second, third and fourth biggest selling models in the quarter. Rival Hyundai's Grand i10 is the fifth largest selling model in India during the period under review followed by Honda Cars India's sedan City at the sixth position. Maruti Suzuki India's (MSI) Alto sold 64,573 units in the April-June quarter this fiscal as compared to 56,335 units sold in the same period of previous fiscal.
9:40 am Big buzzing: Shares of Indoco Remedies soared 20 percent, hitting record high at Rs 197 intraday. Investors are aggressively buying the stock as the pharma player has received a nod from United States' drug regulator for two of its facilities in Goa.
The US Food and Drug Administration (US FDA) has approved the sterile facility (plant-II) and solid dosage facility (plant -III) located at Verna in the adjoining coastal state, a company release said.
"The nod will facilitate the generic approvals in the US market and subsequent product launches there," Indoco Chairman Suresh G Kare said.
9:30 am FII view: Neelkanth Mishra, Credit Suisse said, ''The Indian market has re-rated sharply and in recent meetings we have found many investors uncomfortable with the MSCI India one-year forward P/E of 16.3x, particularly as India's premium to other emerging markets (EMs) is near a five-year high. ''We find the comparison with other EMs as a basket inappropriate,'' he added.
He further said Credit Suisse thus believes that even if the pace of change driven by the new government disappoints consensus as it expects, the market should still do well.
''Sectors with robust earnings growth like NBFCs, discretionary, autos, IT and pharma should drive the upside while PSU banks and late-cycle industrials, driven by hope, may lag,'' he added.
The market has opened flat on Tuesday but the Nifty has scaled 7700. The Nifty is up 24.00 points at 7708.20. The Sensex is up 97.90 points at 25813.07. About 480 shares have advanced, 107 shares declined, and 20 shares are unchanged.
Bharti Airtel, Sun Pharma, ITC, BHEL and Tata Power are top gainers in the Sensex. Among the losers are Wipro and Tata Motors. Idea is up 3 percent while Indoco Remedies gains 17 percent.
The Indian rupee opened marginally higher at 60.25 per dollar versus 60.30 Monday.
Dollar holds steady against major currencies as investors reduced holdings of stocks and other risky assets on anxiety about escalating violence in Gaza and Ukraine.
Ashutosh Raina of HDFC Bank said, ''The chances of further escalation in tension between Russia and Ukraine cannot be ruled out. The 10-Year US bond yields have settled below 2.5 percent, with gold prices also spiking up. Bond Markets will continue to react and take cues from news flow. Expect rupee to trade in the range of 60-60.5/dollar.''
Mild risk aversion seeps into global markets again as geopolitical uncertainty and the possibility of tougher sanctions against Russia impact sentiment. Equities slip with the Dow closing about 50 points lower.
Following yesterday's public holiday Japanese shares are playing catch up this morning. Panasonic is up 1.5 percent on news that it has reached a basic agreement to sell its cellphone base station business to Finland's Nokia. Kospi is trading at 2014 highs and holding in the green after the finance minister promised to use more aggressive monetary policies to aid growth.
Crude prices rise as US President Barack Obama spoke about addressing violence in Ukraine which has heightened the geopolitical risk premium. Gold steadies above the USD 1,300 an ounce support level, aided by anticipation of increased geopolitical risks.