Huge volumes in Arvind Mills
Kochi: Arvind Mills has been witnessing sustained interest in the recent past. The stock, which closed weak on Wednesday, witnessed huge volumes on the bourses. The stock ended the day at Rs 36.60, down 2.66 per cent with around 2.08 crore shares traded on the BSE. On the NSE, the stock closed at Rs 37, down 1.07 per cent with around 94.23 lakh shares traded. Of the traded shares, 60 per cent was up for delivery on the BSE while only around 30 per cent on the NSE. According to a company press release, Textilespace Technologies, promoters' group company, offloaded about 6.84 per cent stake (1.2 crore shares) in the paid-up equity capital of the company. Consequent to the sale, the Textilespace stake has come down to 32.47 per cent.
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No brokers on arbitration panels, SEBI tells SEs
Hyderabad: Folowing the recent findings and recommendations of the Joint Parliamentary Committee (JPC) on the securities market scam, the Securities and Exchange Board of India (SEBI) has directed all the stock exchanges to immediately amend the rules or articles of association pertaining to the Arbitration Committees to see that there were no stockbrokers on these committees. The move, primarily aimed at ensuring no preferential treatment to the stockbrokers and also to provide impartiality to the common investors in the disputes resolving mechanism, assumes significance since there would be no stockbrokers now on the arbitration councils of stock exchanges, which were essentially meant for resolution of disputes between the investing public and various stock market intermediaries. Apart from directing the stock exchanges to amend their articles of association within two months, the regulator has also advised the exchanges to reconstitute their arbitration councils within three months.
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Satyam: Outlook negative, buy June 170 puts
Mumbai: The outlook on the Satyam stock is negative. The downside price target is Rs 155. The risk is that the stock may move up to Rs 200 before gravitating to lower levels. Consider buying the June 170 puts. The directional risk is low because the option is out-of-the-money. But the put delta may not capture the risk, because the stock has tended to exhibit sharp price jumps. The position is not subject to high risk due to fall in volatility. The primary risk is the loss in value if the stock does not reach the downside price target at the horizon. This is because of put carries low gamma and high theta. If the stock declines to Rs 155 at the horizon, the June 170 puts will generate 162 per cent returns. If the stock ends at the upside risk level of Rs 200, the June 170 puts will tend towards zero. Note that the payoffs are based on forecast volatility that is higher than the current implied volatility. In the event that the realised volatility is lower than the forecast volatility, losses will be higher, and profits lower than the projected levels. The horizon period is 11 days. The market lot is 1,200.
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Oil, refinery stocks rally on profit, dividend hopes
Mumbai: Oil and refinery stocks have witnessed a rally during the past month on account of a range of factors from good dividend expectations and upside in profitability. Analysts are of the opinion that recent quarter performance of most oil and refinery companies have shown remarkable upside in profitability and this upside is sustainable. Oil and Natural Gas Corporation's (ONGC) net profits went up by 66 per cent to Rs 10,282 crore for financial year 2002-03. The turnover has risen by 50 per cent to Rs 35,821 crore during fiscal 2002-03 over the previous year's figures. For the same period, BPCL registered a net profit of Rs 1250 crore (Rs 849.8 crore) and Kochi Refineries posted net profits of Rs 456 crore (Rs 68.77 crore). Oil and refinery companies have declared higher dividends and this trend is expected to continue with IOC as well. ``One expects 35-40 per cent dividend announcement from IOC,'' said a dealer. ONGC declared an interim dividend of Rs 17 while HPCL declared a 20 per cent interim and BPCL declared a final dividend of Rs 13 for the year 2002-03. The `disinvestment story' has also affected stocks such as HPCL and BPCL during the past month. ``Both the stocks suffered when reports came in that there could be a further delay in the disinvestment process. However, with the disinvestment minister indicating that the process is likely to be taken up soon, the stocks rallied,'' said an analyst from a domestic brokerage firm.Stocks that hit the 52-week high on Wednesday are IOC, which closed at Rs 394 registering a new high of Rs 399.80, and ONGC that closed at Rs 496.20 with a new high of Rs 503.90.
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Broad-based buying lifts equity markets
Mumbai: After a retreat on Tuesday, said to be on profit-booking, the ebullience of the past week returned to the stock markets today, a trend that may be sustained if the rains are not too late. Reports, meanwhile, said that rain clouds were spotted off the coast of Kerala, the southern State that receives the first monsoon showers. Broad-based buying on Wednesday sent the 30-share Sensex, the benchmark index of the Bombay Stock Exchange up 1.08 per cent or 34.52 points to close at 3216.49. The 50-share S&P CNX Nifty closed the day at 1021.05, up 1.03 per cent from yesterday's close of 1010.65. Hectic buying was seen in index heavyweight Reliance Industries and technology sector leader Infosys. RIL was up 3.17 per cent at Rs 301.15 and Infosys gained 1.2 per cent to close at Rs 2,760 on the BSE. Buying was seen across the board. Return of interest in index stocks indicates a prolonged rally, a dealer said. Seventeen of the 30 shares comprising the Sensex advanced today while one remained still.
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Diamond cos do not shine on the bourses
New Delhi: Though diamond is the single largest foreign earning commodity in the country accounting for around 17 per cent of the country's merchandise exports and accounts for 80 per cent of the global market by volumes, listed diamond companies are increasingly losing their shine on the Indian bourses. Out of the 18 listed diamond companies on the BSE, currently only seven are being traded. Even out of these seven, four are being traded at heavy discount and volumes are also abysmally low.
Except three companies, namely, Su-Raj Diamonds, Classic Diamonds and Flawless Diamonds, the daily volumes of the other five companies are less than a thousand. In case of Su-Raj Diamonds, the combined volume on BSE and NSE on Wednesday stood at 92,270. Classic Diamonds notched up a volume of 6,172 on Wednesday on BSE and there were no trades on the NSE.
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Indo Rama Textiles plans to list shares
New Delhi: Indo Rama Textiles Ltd (IRTL), the company into which the spun yarn business of Indo Rama Synthetics (I) Ltd (IRSL) has been de-merged from April 1, 2002, plans to list its equity shares in all stock exchanges in which IRSL's equity shares are listed. For the year ended Match 31, 2003, IRTL recorded a net profit of Rs 7.86 crore on a sales of Rs 330.04 crore. IRSL on Wednesday said its paid-up share capital had been reduced to Rs 133.02 crore from Rs 166.27 crore consequent to the split in the share capital in the ratio of 80:20. The board of directors of IRTL has allotted 3,32,34,621 shares of Rs 10 each credited as fully paid-up to IRSL's shareholders, whose names appeared on IRSL's registrar of members as on May 30, 2003. IRSL is already listed on the Stock Exchange, Mumbai, National Stock Exchange, the Madhya Pradesh Stock Exchange, the Delhi Stock Exchange, the Ahmedabad Stock Exchange and the Calcutta Stock Exchange.
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SEBI advises bourses to pen pact with NSE, BSE
Hyderabad: While responding to the inability expressed by some of the stock exchanges in computing the mean impact cost calculations at their exchanges, the Securities and Exchange Board of India (SEBI) has declined to permit these stock exchanges from using the impact cost calculations of the NSE and the BSE and has suggested them to enter into formal legal arrangements with the two for such purpose. The market regulator had earlier, vide circular issued on March 11, 2003 stipulated that the scrips would have to be margined based on the categories in which they were included. The classification of scrips into Group-I and Group-II and Group-III was specified in the said circular. The regulator also provided the methodology for the calculation of the mean impact cost in the circular. According to the SEBI general manager, P.K. Bindlish, the regulator had received representations in this regard from some stock exchanges expressing their inability to compute the mean impact cost calculations at their exchanges and sought the permission to use the impact cost calculations of the NSE or the BSE.
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