Archive for the ‘Stock’ Category

COMMODITY WEEKLY COMMENTARY 4th – 8th October

Once again international gold prices tested their new highs last week as prices breached the psychological level of $1300 and silver marked the 30 year high on COMEX division. However local gold prices were mostly remained sideways during the week amid stronger rupee and profit booking which limited the upside in prices.

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Nevertheless, silver once again overshadowed gold movements and surged high to claim 33000 mark on MCX. In base metal pack copper along with nickel, zinc and lead started the week with positive energy but dull economic data from U.S and Europe economies pressurized the prices in later part. However improved Chinese  manufacturing data once again underpinned the prices and supported copper and nickel to end the week in green zone.


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Earlier, shanghai copper dropped to its lowest in more than a month last week as China’s move to curb property prices dented sentiment, but losses were limited by improving demand prospects and ongoing weakness in the dollar. In energy counter crude oil settled up last week helped by data showing a drop in U.S. crude and product inventories.


Further fall in dollar index also helped the prices to move up. U.S. crude stocks fell 475,000 barrels last week, data from the Energy Information Administration showed. U.S. distillate inventories fell by 1.27 million barrels in the week to Sept. 24, counter to analyst expectations for a 300,000 barrel build.


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In agro commodities spices pack witnessed see saw moves during the week and remained volatile. Pepper futures ended the week with negative impression amid weak exports and low trading activity. As per Spices Board data, pepper exports from India have gone down by 5% in volume term during April-August 2010 as compared to same period last year. Jeera futures also traded on a negative note during the week on extended selling pressure backed by weak domestic and export demand. Expectations of rise in acreage under jeera crop this season have also supported the down side.

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In oil seeds section soya bean and mustard remained under pressure as factors like bumper soya crop expectation and pick up in fresh arrivals to the spot market led the market to show a negative trend. The chana futures traded on a positive note for most part of the week retreating from previous losses on fresh buying from retail sector.

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Weekly Update 4th – 8th October 2010

Global markets closed on a mixed note in the week gone by, with Indian markets closing in positive on weekly basis. To send a message to China to raise value of its currency, the U.S. House of Representatives this week approved a bill that would let domestic companies petition for duties on imports from China to compensate for the effect of weak yuan. U.S. Treasury Secretary Timothy F. Geithner said he is confident that tensions over China’s currency, the yuan, won’t lead to escalating trade sanctions or feed into a broader global currency conflict.

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European confidence in the economic outlook unexpectedly improved this month. An index of executive and consumer sentiment in the 16 euro nations rose to 103.2, the highest since January 2008, from a revised 102.3 in August. The European Commission forecasted a more “moderate” expansion in the second half of the year as governments from Ireland to Portugal step up spending cuts to push down deficits. ECB President Jean-Claude Trichet said that there is “continuing uncertainty” about the outlook.

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China’s manufacturing expanded at the fastest pace in four months in September. According to China’s logistics federation and statistics bureau, the purchasing managers’ index rose to 53.8 from 51.7 in August. The data is viewed very positively by the market as it shows that China’s economic momentum may counter weakness in the global recovery. It is believed that growth may be further aided in coming months as government plans to speed the completion of stimulus projects and boost public housing construction.

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In Japan, the jobless rate fell to 5.1 percent from 5.2 percent. After intervening few days back in the foreign exchange market in order to stem the yen appreciation, Japan’s Finance Minister reiterated that Japan is ready to keep intervening after selling yen for the first time in six years last month.

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Core infrastructure industry that account for 26.7 percent of industrial output in India slowed to 3.7 per cent in August, as compared to 6.4 per cent in the same month last year. Going forward we expect the markets would remain firm as it is supported by strong portfolio investments. The best strategy to ride the tide would be stay invested. Nifty has support between 5940-5870 and Sensex between 19640-
19200 levels.

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Bullions may continue to lead the charge in the commodities counter as both silver and gold recently tested life time highs in MCX. The latest boon to the metal has been increasing expectations that the Federal Reserve will further ease monetary policy with measures including the purchase of Treasuries. Jitters about European sovereign debt problems have also supported gold higher as a safe-haven investment. Better jobless claims data and a revised upward GDP in US supported the crude counter which can make further gains in next coming week. Base metals will take cues from LME as China markets will remain closed for a week. In agro counter pulses along with oilseeds may trade in range while spices can get some support from upcoming festive season. Mentha oil firm export demand and low crop will assist the prices to make fresh high in MCX.

IDFC leads the gainers of group ‘A’ on BSE

Infrastructure Development Finance Company (IDFC) is currently trading at Rs 204.80, up by 9.15 points or 4.68% from its previous closing of Rs 195.65 on the BSE.

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The scrip opened at Rs 197.00 and has touched a high and low of Rs 205.30 and Rs. 196.00 respectively. So far 1985833 shares were traded on the counter.

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The BSE group ‘A’ stock of face value Rs 10 has touched a 52 week high of Rs 201.05 on 16-Sep-2010 and a 52 week low of Rs 139.80 on 04-Nov-2009.

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Last one week high and low of the scrip stood at Rs 205.30 and Rs 191.10 respectively. The current market cap of the company is Rs 29243.72 crore.

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The Institutions holding in the company stood at 86.68% and Non institution were holding 13.32% of stake respectively.

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The other top gainers of BSE group ‘A’ were DLF up by 4.86%, Centeral Bank up by 4.58%, Aban Offshore up by 4.57%, Federal Bank up by 4.48% and Everest Kanto up by 4.38%

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The Institutions and Non-Institutions holding in the company stood at 86.68% and 13.32% respectively.

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Infrastructure Development Finance Company (IDFC) is planning to mop up about Rs 3,400 crore via issue of long-term bonds which is expected to open in the first week of October. In this regard, the company has already filed the draft papers with the market regulator Securities and Exchange Board of India (SEBI).

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According to the Draft Shelf Prospectus, the said bonds will have the face value of Rs 5,000 and some part will be utilized for infrastructure lending. This will be the first public issue under the new rule that allows tax benefits for investment in long-term infrastructure bonds.

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The company has reported a net profit of Rs 319.71 crore for the quarter ending on June 30, 2010 against Rs 243.49 crore for the quarter ending on June 30, 2009, up 31.30%.

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The company provides financial assistance to various segments such as power, roads, ports, telecommunications, information technology, urban infrastructure, healthcare, education infrastructure, food and agri-business infrastructure, healthcare and tourism.

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Tata Steel, TCS and Madhucon Projects may witness some action today

Tata Steel, a part of the salt-to-steel conglomerate Tata Group, has decided to acquire 80% stake in the Direct Shipping Ore (DSO) project of Canada-based New Millennium Capital Corp for a consideration of around Rs 1,350 crore.

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IT major Tata Consultancy Services (TCS) has inked a significant multi-year agreement with SUPERVALU Inc. for a full services engagement.

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S Kumars Nationwide has mobilized $50 million worth of fresh funds through issue of equity shares to institutional investors.

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Jyothy Laboratories is expecting a turnover of Rs 500-crore from its largest selling fabric-care brand ‘Ujala’ by entering the competitive Rs 11,000-crore detergent market, competing with strong market leaders such as HUL and P&G. The company is planning to extend its business from Kerala to the rest of the South.

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Madhucon Projects’ promoted Simhapuri Energy (SEPL) has tied up funds for its 300 mega watt (MW) Phase II Thermal Power Plant at Krishnapatnam, SPSR Nellore District, Andhra Pradesh.

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Bank of Baroda has decided to takeover specific assets and liabilities of Mumbai-based Memon Cooperative Bank. In this regard, the company has received approval from Government of India and Reserve Bank of India.

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Dabangg Magic Powers In Stock Market

Salman Khan-starrer Dabangg created the euphoria at the box-office which has lifted the shares of Shree Ashtavinayak Cine Vision, the co-producer of the movie, which soared over 8 per cent on the Bombay Stock Exchange on Tuesday.

Shree Ashtavinayak Cine Vision company had made a strong opening on the BSE today and settled at Rs 25.50, reflecting a gain of 8.28 per cent.

During the session, the stock had climbed nearly 10 per cent to touch a month high of Rs 25.90.

“The Salman factor has helped the stock, witness a handsome gain. The movie is breaking records at the box-office, which is mirroring in the stock movement,” SMC Capitals Equity Head Jagannadham Thunuguntla said.

‘Dabangg’, which stars actor Shatrughan Sinha’s daughter Sonakshi Sinha also features Sonu Sood, Vinod Khanna and Dimple Kapadia, was made with a budget of Rs 18-crore and was reportedly sold to distributors for Rs 40 crore.

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Reliance Broadcast Network touches roof as its arm acquires Line V of DMRC

Reliance Broadcast Network is currently trading at Rs. 109.80, up by 5.20 points or 4.97 % from its previous closing of Rs. 104.60 on the BSE.

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The scrip opened at Rs. 109.75 and has touched a high and low of Rs. 109.80 and Rs. 109.75 respectively. So far 52,300 shares were traded on the counter.

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The BSE group ‘T’ stock of face value Rs. 5 has touched a 52 week high of Rs. 145 on 04-Dec-2009 and a 52 week low of Rs. 45.60 on 27-May-2010.

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Last one week high and low of the scrip stood at Rs. 109.80 and Rs. 96 respectively. The current market cap of the company is Rs. 506.47 crore.

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The promoters holding in the company stood at 61.47% while Institutions and Non-Institutions held 1.14% and 37.38% respectively.

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Reliance Broadcast Network (RBNL)‘s Out of Home (OOH) arm — Big Street — has acquired Line V of the Delhi Metro Rail Corporation (DMRC) for its outdoor advertising activities for a period of five year’s. The company has already acquired Line II and III of the DMRC. With the latest win, it now holds 40% of premium inventory in the DMRC network.

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The OOH market in India is estimated to be around Rs 1,700 crore. The company is looking to capitalize its OOH inventory with the Line V acquisition as DMRC attracts around 1.5 million commuters daily.

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The Anil Dhirubhai Ambani group company operates the Big 92.7 frequency modulation (FM) radio station . It runs 45 radio stations. The company was demerged from Reliance MediaWorks in August 2009.

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SILVER……GROWING AVENUE OF INVESTMENT

Recently silver, known as poor’s gold, is gaining not only against the dollar and other old world currencies but also outperforming gold. Due to high prices gold is loosing its own attraction from common man and importance of silver as precious metals is gaining momentum. The declining trend of gold/silver ratio indicate that silver become better destination for investment. Like gold, silver has retained rally momentum due to recent poor economic data that has caused investors to purchase Silver as a “safe haven” alternative investment. The pickup of silver industrial demand due to the emergence and growth of a number of new end uses, and continued strong investment demand is pushing silver prices sharply higher.

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Like all metals, London Bullion Market is the global hub for silver trading, while the New York’s Comex Futures dominate the solver fund activity. The world’s largest silver backed exchange-traded fund, the i Shares Silver Trust, said its holdings rose to 9,280.40 tonnes by Sept. 1 from 9,151.03 tonnes on August 5.

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Global demand- supply of silver According to World Silver Survey 2010 , global silver mine production rose last year, by almost 4%, its seventh straight annual increase to reach a record high of 22,072 ton.Peru is the world’s largest silver producing country followed by Mexico, China, Australia and Bolivia. GFMS is forecasting a further mine production rise of 3 per cent this year.

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According to GFMS, In the last ten years, the world jewellery demand was down 8 per cent and silverware as much as 38 per cent. And because of technology changes silver use in photography sector had suffered a major fall of 62 per cent. But as strengthening of belief in silver as a precious metal is the 145 per cent demand gain since 2000. The industrial application of silver is almost 48 per cent of total silver use.

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Indian demand- supply of silver Though India is generally believed to have a great appetite for gold, Indians also love to possess silver in their homes for jewellery. India is voluminous importer of silver. Of the 4,000 tonnes that India used to import annually, around 2,600 tonnes was used to make jewellery and ornaments. MMTC is the largest importer of gold in the country. The firm’s silver imports fell by more than 44% in the fiscal year to end March 2010, as high prices dented demand. More than 60% of India’s silver demand comes from farmers.

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Last year silver demand dipped because the country experienced one of the worst monsoon seasons in over four decades. However, with much better monsoon this year, the situation is set to reverse and India’s appetite for silver has also been boosted because gold has become too expensive at current prices. According to official data, India’s silver imports in the first six months of 2010 are up 579%.

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From April this year, India has also started hallmarking of the white precious metal to ensure purity. With increasing amounts of impurities in jewellery being sold across the country, public sector trading major, Minerals and Metals Trading Corporation (MMTC) is banking on its branded jewellery, silverware gift items and coins to push up its market share.

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Like gold, silver has not enjoyed equal recognition from hedge funds, pension and retirement funds, insurance companies, and sovereign wealth funds– but this is likely to change as fund managers recognize silver’s relative value and simply wish to diversify their precious metals exposure.

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Outlook

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Good monsoon, high gold prices and global trends may help silver outperform the yellow metal in India. Better harvesting will underpin demand from the farming community this year. Since gold prices are trading over `19,000 per 10 gm, many rural families are now switching to silver.The weakening of rupee also supporting the prices.

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More and more people here are using silver as a speculative commodity play as many others are looking at it as a safe haven asset. The overall market sentiment is bullish for silver. So it could be a more decisive silver price breakout before the year ends to touch the level of `33500.

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