Stock Market Discussion

[ajay_ijn]

Financial firms rush into MF space
Financial firms rush into MF space

With the capital market showing signs of revival, banks and financial companies that had put their mutual fund plans on hold are gearing up to enter the segment.

At present, nine players from the financial services sector are in various stages of entering the space. The list includes Bank of India, IDBI Bank, Axis Bank, Mahindra and Mahindra Financial Services (M&M Finance), SREI Infrastructure Finance, Bajaj Allianz, Indiabulls Fiancial Services, L&T Finance and Motilal Oswal.

While Axis Bank and Indiabulls are ready for product launches, companies like Srei have received the regulatory go-ahead. Bank of India and IDBI Bank are in the process of setting up asset management companies and are scouting for partners.

Though the market is crowded with 36 players, some of whom are looking to exit, the newcomers say there is a lot of potential. Besides, a mutual fund subsidiary will help these companies cross-sell. They would also be able to use their existing networks, said bankers.

“We have to provide all financial services. We have a large customer base and we can cross-sell products,” said Bank of India Executive Director BA Prabhakar. BoI would soon appoint a consultant to finalise a foreign partner.

The AMC set up by Axis Bank, the country’s third-largest private sector lender, is expected to enter the mutual fund space early next month.

“The proportion of mutual fund investment to household savings is 4-5 per cent in India while the share of bank fixed deposits is around 20 per cent. In addition, over the last 10 years, while a number of new players have come in, we have also seen a number of players exit. This will continue,” said Rajiv Anand, who heads Axis Asset Management Company.

A banker said players that did not have a large retail participation would depend on corporate links for debt schemes.

Another lender, IDBI Bank, recently received the Reserve Bank of India’s approval for starting a mutual fund business. It has now approached the market regulator, the Securities and Exchange Board of India (Sebi), for approval. IDBI Chairman and Managing Director Yogesh Agarwal expects to launch the business by the end of the current financial year.

Among non-banking finance companies, SREI Infrastructure has received Sebi’s approval to enter the asset management business. Mahindra & Mahindra Finance has sought regulatory nod for an AMC.

“We have appointed a consultant to look into the worthwhileness of the mutual fund business. The consultant's report is expected in three months. We have also applied to Sebi for its in-principal approval,” said M&M Finance Chief Financial Officer V Ravi.

Systematic Investment Plans are great. one can invest as low as Rs 500 per every month in diversified funds. Investing every month reduces the effect of volality of sensex compared to investing large amounts once at a time.

if one invested large amounts once at a time during early 2008 which sensex hit 21000, he would still have lossess (-25%) conisdering he put his money only on those 30 companies in sensex.

while investing equal amounts from Jan 2008 to Sept 2009 would fare much better, might earn some profits too. Although one has to be careful in choosing the fund or probably diversify a little, by investing in 2 to 3 funds.

 

[NSG_Blackcats]

Nifty hits 5000 mark, first time since May '08​

Mumbai: Performing in line with other major markets, buoyed by the news of an impending economic recovery in the US, the National Stock Exchange index Nifty on Thursday crossed the 5000-mark for the first time since May 2008. It took the Nifty 326 trading sessions to regain the psychologically important level. The Nifty was up 35 points at 4,993, after hitting 5003 at the day’s high - almost 90 percent above from its March lows.

Link

 

[Pintu]

http://www.ptinews.com/news/289133_Sensex-up-by-30-pts--auto-realty-stocks-gain

Sensex up by 30 pts; auto realty stocks gain

STAFF WRITER 16:35 HRS IST

Mumbai, Sep 18 (PTI) A sudden revival of buying in auto and realty counters helped the benchmark Sensex end the day higher by over 30 points to stretch the winning streak to the fourth consecutive day.

After losing over 100 points in afternoon trade, short coverings ahead of a three-day weekend holidays helped the index settle in the positive terrain.

The 30-share Sensex on the Bombay Stock Exchange ended the day at 1,6741.30, up by 30.19 points or 0.18 per cent over from previous close.

The broad-based Nifty of the National Stock Exchange also improved by 10.50 points at 4,976.05. The BSE and the NSE will remain closed on Monday on account of Ramzan Id.

Brokers said if the moderate gain of 30 points in a lacklustre trading today is any hint, then the market is consolidating below 17,000- level.

 

[Pintu]

71 % Stocks are trading below 20008 level, a piece of information in the Business Standard link:


71% stocks trade below May 2008 levels


Regards

 

[Pintu]

FII inflows set to cross $10 bn-mark this month: Analysts- Analysis-Markets-The Economic Times

FII inflows set to cross $10 bn-mark this month: Analysts
20 Sep 2009, 1200 hrs IST, PTI

NEW DELHI: Foreign investment in the Indian stock markets may cross $10 billion-mark by the end of this month as a hefty $9.8 billion (Rs 47,674 crore) have already been poured into the bourses by overseas entities so far this year, analysts feel.

"FII inflows in the Indian equity market would continue in the coming days and it may cross $10 billion level by September-end," Anand Rathi Financial Services Director & Head of Research Tarun Sisodia.

Foreign institutional investors (FIIs) are the net buyer of shares worth Rs 47,674 crore so far in this year, according to the data available with the market regulator or Securities and Exchange Board of India (SEBI).

The infusion of money by overseas investors in shares is a part of their portfolio management in various emerging markets and India is part of that strategy, Sisodia, who is based in Mumbai, said.

So for in this month, foreign investors have infused over Rs 7,400 crore ($1.5 billion), increasing their total net investment, since FIIs were allowed in India, to over Rs 2.78 lakh crore (65 billion dollars), as per SEBI data.

"FII investment in the local markets may cross $10 billion mark by end of this week. As everything is bullish and picture of Indian stock market is very rosy," Delhi-based SMC Global's Vice President Rajesh Jain said.

Significantly, so far in 2009, the Bombay Stock Exchange's benchmark index Sensex gained over 73 per cent. Nifty, the benchmark index of National Stock Exchange has also advanced fairly so far this year.

In long term, the rise in benchmark index would continue, Sisodia added.

"The Indian market has seen a huge inflow of funds from overseas investors and crossing 10 billion dollars level is not tough in the current month," Ashika Stock Brokers Research Head Paras Bothra said.

After pulling out a hefty Rs 52,986 crore (11.9 billion dollars) from the local stock markets last year, FIIs remained net seller of shares for the first two month of current year.

However, with the sign of revival of economies, the trend turned positive during March and marketmen feel that the year will close with huge inflows.

 

[Pintu]

D-Street may witness consolidation this week: Analysts- Market News-Stocks-Markets-The Economic Times

D-Street may witness consolidation this week: Analysts
20 Sep 2009, 1126 hrs IST, PTI

MUMBAI: Dalal Street is likely to witness volatile trade this week as it may go for consolidation before the settlement in the derivatives segment, analysts said.

Marketmen believe the market sentiment is likely to remain bullish even as investors will remain cautious ahead of the settlement in the domestic derivatives segment and the US Federal Reserve meeting scheduled for this week.

"The market is expected to remain sideways ahead of the clearing date for derivatives. It may consolidate at these levels, while the movement will remain on the upside as the picture overall is very rosy," SMC Global Vice-President Rajesh Jain said.

Over the week, the BSE Sensex gained 477 points, or nearly three per cent and closed at 16,741.3 points. During the week, on September 15 the total investors' wealth on the Bombay Stock Exchange grew by over Rs 75,000 crore as the benchmark Sensex scaled to a new 15-month high of 16,454.45 points.

The market would trade only for four days this week, as Monday will be a trading holiday on the occasion of Ramzan Id.

"Due to the settlement in Futures and Options segment markets will be in consolidation phase, but uptrend will continue," Ashika Stock Brokers Research Head Paras Bothra said.

Analysts feel there would be an uptrend in the market as valuations are reasonable at this level. However, profit booking would keep trade choppy during the week.

"The markets have reached in an oversold zone and next week the markets will be choppy and will consolidate at these levels for a while," Bonanza Portfolio Assistant Vice President Research Avinash Gupta said.

During the week, foreign institutional investors have put in over Rs 5,300 crore in Indian equities.

Bothra added that FIIs are bullish on the Indian markets and they will for now keep investing in the domestic bourses.

"US Fed will meet on September 22-23 to discuss the state of the US economy and to discuss the financial policies and the Indian markets will cautiously look at the situation," Jain added.

On Friday, the US markets ended in the green with the Dow Jones Industrial Average gaining 36.28 points to 9,820.

Besides, S&P 500 was up 0.26 per cent to 1,068.30 and tech heavy Nasdaq up 0.29 per cent to 2,132.86 points.

 

[Pintu]

Foreigners may get direct ride to Dalal Street- Market News-Stocks-Markets-The Economic Times

Foreigners may get direct ride to Dalal Street
21 Sep 2009, 0320 hrs IST, Deepshikha Sikarwar & Soma Banerjee, ET Bureau

NEW DELHI: A complete overhaul of the portfolio investment regime is on the cards. Capital market regulator SEBI is giving finishing touches to a detailed concept paper that seeks to simplify and further relax the norms governing investment by foreign institutional investors (FIIs) in Indian equities.

The proposed move could give individual foreign investors direct access to the Indian stock markets, a person privy to the discussions told ET.

The concept paper, which is expected to be taken up by the Sebi board shortly, will unveil a new Qualified Foreign Investor Framework (QFIF) to replace the existing FII one. At present, a foreign individual seeking to invest in Indian stocks has to be registered as a sub-account of an FII, which in turn has to apply to Sebi on the behalf of the sub-account holder. Besides, the validity of the sub-account registration is co-terminus with the registration of the FII through which he has accessed the Indian market. This is onerous and often expensive.

The person with knowledge of the development said the idea behind the concept paper was to remove unnecessary hurdles and make it simpler, and also to bring foreign investors on a par with domestic ones. It is also expected to encourage more investors to come through the front door instead of the participatory note (PN) route. PNs are overseas derivative instruments with Indian shares as the underlying asset that allow foreign investors to invest in Indian equities indirectly without revealing their identity to the Indian authorities.

If these proposals go through, individual foreign investors would be able to buy and sell securities on the Indian stock exchanges directly by opening a demat account with an Indian depository and a dedicated bank account with a mandatory cheque payment facility. This would also address ‘know-your-customer’ of banks and depositories as they would be liable to carry out all checks on the overseas investor before opening an account. Moreover, the mandatory cheque payment requirement would generate a paper trail that will help track transactions related to the account, and possibly detect moneylaundering.

A senior government official said while it may be impossible to stop issuance of participatory notes altogether, simpler and easier investment norms will encourage foreign investors to come in directly. Foreign portfolio investors registered in India issue PNs to their overseas clients, who may not be eligible to invest in the domestic market or do not wish to have a direct presence in the country. PN holders derive all the benefits of the underlying shares, including dividends and capital appreciation.

 

[Pintu]

Will it be festive season for sensex? - India Business - Business - NEWS - The Times of India

Will it be festive season for sensex?
TNN 21 September 2009, 01:13am IST

MUMBAI: As the festive season kicks off in the country, Dalal Street has become the cynosure of all eyes. The sensex has already gained nearly 1,200 points in just 14 trading sessions this month, closing with gains on 10 occasions. According to analysts, FII inflow may cross the $10 billion-mark by the end of this month as a hefty $9.8 billion (Rs 47,674 crore) has been poured into the bourses by overseas entities so far this year.

Will the sensex scale new highs this festival season? Analysts are keeping their fingers crossed for now but they expect some volatile trading sessions this week, mainly because of the coming derivatives expiration on Thursday.

Moreover, Monday is a trading holiday because of Eid and hence traders will have just three sessions before the settlement of September contracts. ‘‘Due to the settlement in futures and options segment markets will be in consolidation phase, but uptrend will continue,’’ Paras Bothra, head of research, Ashika Stock Brokers, said.

However, looking beyond the settlement, market sentiment is likely to remain bullish even as investors will be cautious, analysts feel. There is a meeting of the US Federal Reserve also scheduled for this week. ‘‘The market is expected to remain sideways ahead of the clearing date for derivatives. It may consolidate at these levels, while the movement will remain on the upside as the picture overall is very rosy,’’ Rajesh Jain, VP, SMC Global said. Last week, although the BSE sensex gained 477 points, or nearly 3%, to close at 16,741 points, the last two days it struggled to close higher than previous closes.

Although valuations are reasonable, technically some correction could set in soon. ‘‘The markets have reached an oversold zone and this week it will be choppy and will consolidate at these levels for a while,’’ Avinash Gupta, VP-Research, Bonanza Portfolio, said.

During the week, FIIs have put in over Rs 5,300 crore in Indian equities, a large chunk of it because of the Rs 3,200 crore placement of RIL treasury shares. Bothra added that FIIs are bullish on the Indian markets and they will for now keep investing in the domestic bourses. ‘‘US Fed will meet on September 22-23 to discuss the state of the US economy and to discuss the financial policies and the Indian markets will cautiously look at the situation,’’ Jain added.

‘‘FII inflows in the Indian equity market would continue in the coming days and it may cross $10 billion level by September-end,” Tarun Sisodia, director & head of research, Anand Rathi Financial Services, said.

So far this year, FIIs have net bought shares worth nearly Rs 48,000 crore, according to Sebi data. The infusion of money by overseas investors in shares is a part of their portfolio management in various emerging markets and India is part of that strategy, Sisodia, who is based in Mumbai, said. And so far this month, foreign investors have infused over Rs 7,400 crore ($1.5 billion).

 

[A M J]

IS there a probability of a new bubble in Indian Stock Market, as seen from recent Bull trend?

 

[Pintu]

http://www.ptinews.com/news/305264_Sensex-gains-on-firm-global-trend

Sensex gains on firm global trend

STAFF WRITER 16:35 HRS IST

Mumbai, Sep 29 (PTI) The Bombay Stock Exchange benchmark Sensex today gained nearly 160 points on fresh buying by funds in line with firming global trends.

The 30-share index closed higher by 159.91 points at 16,852.91 points as investors purchased heavyweight stocks such as Reliance Industries and Infosys Technologies, carrying nearly 23 per cent weightage on the Sensex.

The wide-based National Stock Exchange index Nifty regained crucial 5,000 points level after almost a week by gaining 47.90 points at 5,006.85 points.

Brokers attributed fresh buying by funds to a firm trend in Asian stock markets. Buying for new monthly contract in derivatives segment on expectations of an early recovery in the global economic recession also supported the firm trend.

The barometer had lost nearly 88 points in its previous session on Friday last week. The stock market was closed yesterday on account of 'Vijay Dashmi'.

 

[Pintu]

Bharti Airtel rises 1 pc on BSE- Stocks in News-Stocks-Markets-The Economic Times

Bharti Airtel rises 1 pc on BSE
29 Sep 2009, 1842 hrs IST, PTI

MUMBAI: Bharti Airtel today pared its early gains and closed one per cent higher on the Bombay Stock Exchange amid the ongoing discussions with South Africa's MTN for creating a telecom entity, for which exclusive talks period expires tomorrow.

The scrip ended the day at Rs 418.85, up 1.09 per cent from its previous close on the BSE. During the trade-hours, it had touched an intra-day high of 3.46 per cent to Rs 428.70.

A similar trend was seen on the National Stock Exchange, where the stock closed at Rs 417.55, up 0.72 per cent from its last close. Earlier, during the day, shares of the telecom major had touched a high of Rs 428, up 3.24 per cent.

On the volume front, over 94.59 lakh shares changed their hands on the two bourses.

Even though the exclusive talks period between the two companies ends tomorrow, a clear picture is yet to emerge on the proposed deal that would create a 24-billion-dollar entity, having over 200 million subscribers.

 

[Pintu]

FIIs infuse Rs 714.50 crore in Indian shares- Market News-Stocks-Markets-The Economic Times

FIIs infuse Rs 714.50 crore in Indian shares
29 Sep 2009, 2142 hrs IST, PTI

MUMBAI: Overseas investors today infused a net Rs 714.50 crore in Indian equity markets.

Foreign institutional investors (FIIs) were gross buyers of shares worth Rs 3,360.48, while they sold equities valued at Rs 2,645.98 crore that resulted in a net investment of Rs 714.50 crore, the provisional data available with the Bombay Stock Exchange (BSE) shows.

Domestic institutional investors also made a net investment of Rs 91.77 crore in share markets.

On Friday last week, FIIs were net purchaser of stocks worth Rs 3,311.90 crore, the latest data with market regulator Securities and Exchange Board of India (SEBI) shows.

However, brokers, on the behalf of their clients, booked profits and were net sellers of shares worth Rs 122.75 crore, as per the BSE data.

Further, proprietors and non-resident Indians were also in selling mood and in total offloaded shares worth Rs 33.03 crore.

The BSE's benchmark index Sensex today gained marginally by 159.91 points or 0.96 per cent to close at 16,852.91 level.

 

[Pintu]

Regulator to keep tabs on listed entities to ensure greater transparency- Market News-Stocks-Markets-The Economic Times

Regulator to keep tabs on listed entities to ensure greater transparency
30 Sep 2009, 0215 hrs IST, ET Bureau

MUMBAI: Reclusive listed companies may soon have to provide sufficient information about themselves to the market about the way of functioning to ensure greater transparency.

Sebi will keep tabs on listed entities and issuers unwilling to co-operate in sharing sufficient information about the company, Sebi chairman CB Bhave said on Tuesday at the launch of rating agency Crisil's equity research division Independent Equity Research (IER).

Through IER, Crisil will provide independent assessments on the fundamentals and valuations
of listed Indian companies. It will analyse the business prospects of both the industry and company, management and corporate governance, financial performance and outlook for earnings growth among others.

"I'm sure there would be reports commissioned by investors for which Crisil may not find sufficient co-operation from the concerned company. And I hope Crisil will be able to come out and say in its report that the information provided by the concerned issuer was not be sufficient to evaluate. It will help us regulators to know which companies are not ready to give out information and focus on such companies in greater detail. It'll also help investors to know the set of corporates who are not prepared to share sufficient information about themselves," Mr Bhave said.

These grades will be available on a five-point scale and will be updated on a quarterly basis. "It is a relatively new concept...through this initiative, we aim to expand the coverage available for small and mid-cap companies," said Roopa Kudva, managing director and CEO of Crisil.

However, investors must look at the research report and should know who has commissioned the report, Mr Bhave said. "This is an important effort in creating liquidity in some of the stocks, in which people don't want to carry out any research," he added.
A survey by Crisil indicates that while the top 100 of around 3,500 actively-listed companies receive reasonable levels of equity research coverage, the remainder by and large do not.

Globally, in some of the countries, including London (AIM), Singapore and Malaysia, exchanges sponsor these research reports while in countries such as Hong kong, companies sponsor these reports. Back home, there will be three modes of provision of Crisil IER — company, investor and exchange-sponsored — and the reports will be available in institutional and retail formats.

 

[Pintu]

http://www.ptinews.com/news/307250_Sensex-closes-above-17k-level--gains-274-poitns

Sensex closes above 17k level; gains 274 poitns

STAFF WRITER 17:31 HRS IST

Mumbai, Sep 30 (PTI) The benchmark Sensex today surged by over 270 points to close above the psychologically crucial 17,000-level for the first time in more than 16 months.

Marketmen said anticipation of strong earnings by India Inc for the second quarter of the fiscal sparked hectic buying across banking, auto, consumer goods and realty counters.

Netting a gain of 273.93 points or 1.63 per cent over its previous close, the 30-share index on the the Bombay Stock Exchange ended the day at a fresh 16-month high of 17,126.84, a level last achieved on May 21, 2008.

Meanwhile, after plunging to its lows since Lehman collapse, Dow Jones Industry Average is hovering around 10,000-level, boosting confidence in investors worldwide.

Brokers said market was also driven by strong optimism among foreign funds, largely prompted by higher advance tax payments by companies which grew by over 13 per cent.

 

[Pintu]

http://www.ptinews.com/news/314839_Sensex-down-268-points--Bharti-tanks-over-8-pc

Sensex down 268 points, Bharti tanks over 8 pc

STAFF WRITER 17:1 HRS IST

Mumbai, Oct 5 (PTI) Markets shed over 268 points today on hectic selling in some blue-chip stocks on investors casting doubts over valuations after the benchmark Sensex scaled 17- month high on consistent buying in the previous 3 sessions.

Marketmen said huge fund raising by companies by way of public issues and qualified institutional placements had given way to concerns over liquidity in secondary market.

After a particularly weak opening, the barometer index settled the day at 16,866.41, down by a significant 268.14 points or 1.56 per cent from its last close.

The decline followed 2.65 per cent gain in the previous three days which saw the Sensex closing above 17,000 level for the first time in 17 months.

Markets defied stability in Europe as investors booked profits in a belated reaction to sharp losses in world stocks on Friday on lower than expected US job data.

 

[Pintu]

http://www.ptinews.com/news/316760_Sensex-recovers-from-day-s-low--closes-92-pts-up

Sensex recovers from day's low, closes 92 pts up

STAFF WRITER 16:29 HRS IST

Mumbai, Oct 6 (PTI) Reversing the decline in early trade due to tumbling of telecom stocks, the Bombay Stock Exchange benchmark Sensex today ended over 92 points higher as funds started buying blue-chip stocks across FMCG, metal and banking counters.

The 30-share Sensex, which was down 244 points during intra-day, bounced back to end with a gain of 92.13 points at 16,958.54 as stocks in FMCG, metal and banking segments recorded handsome gains.

Yesterday, the benchmark index had ended down by over 268 points or 1.56 per cent.

Similarly, the wide-based National Stock Exchange index Nifty closed 24.20 points higher at 5,027.30, after touching the day's low of 4,921.05.

The market recovered as foreign and domestic funds returned to pick up fundamentally strong stocks at existing low levels, triggered by a firming global trend and a better opening in European stock markets this afternoon.

 

[Pintu]

Sensex ends flat on profit booking- Market News-Stocks-Markets-The Economic Times

Sensex ends flat on profit booking
8 Oct 2009, 1730 hrs IST, Mohammed Sabir, ET Bureau

MUMBAI: Indian equities ended a volatile session almost flat Thursday as traders chose to wait ahead of second quarter results.

Indices opened on a firm note led by Reliance Industries after the company announced 1:1 bonus share issue. But market faced resistance at higher levels and pared gains. It received support from the positive European markets but jittery investors booked profits toward the close.

National Stock Exchange’s Nifty eked out marginal gains; up 0.33 per cent or 16.5 points at 5002.25. It fell from a high of 5043.05 to a low of 4971.75.

Bombay Stock Exchange’s Sensex closed at 16,843.54, higher by 36.88 points or 0.22 per cent. The index touched a high of 16,998.52 and low of 16,775.36.

“Market is taking a breather before the onset of earnings season. Nifty is moving in range of 4950-5050 and will take cues from results to breakout in either direction,” said a senior analyst from a local brokerage.

The BSE Midcap Index gained 0.79 per cent and BSE Smallcap Index rose 0.22 per cent.

Sectorwise, BSE IT Index dropped 1.86 per cent, BSE Capital Goods edged down 0.01 per cent while BSE Realty Index advanced 2.09 per cent and BSE FMCG added 2.01 per cent.

Sensex gainers included Cipla (6.26%), Siemens (5.33%), Tata Motors (5.32%), Reliance Infrastructure (4.82%) and GAIL (4.13%).

Bharti Airtel (-6.48%), Reliance Communications (-5.89%), Sun Pharmaceuticals (-4.9%), HCL Technologies (-3.95%), TCS (-3.49%) and Infosys Technologies (-1.87%) were amongst the index losers.

Shares of telecom majors witnessed a sell-off after brokerages downgraded the sector on concerns that tariff war would hurt profit margins.

IT stocks were under pressure ahead of the second quarter results from Infosys Technologies and as the rupee continued to rise for 5th straight day against the US dollar.

Market breadth was negative on the BSE with 1,512 declines and 1,246 advances.

European markets were in the green and US stock futures indicated a positive start. At 5:15 pm, Dow Jones futures was up 0.80 per cent, S&P 500 gained 0.87 per cent and Nasdaq 100 moved 0.75 per cent higher.

 

[Pintu]

RIL shareholders take home Diwali bonus, book profit- Stocks in News-Stocks-Markets-The Economic Times

RIL shareholders take home Diwali bonus, book profit
9 Oct 2009, 0304 hrs IST, ET Bureau

MUMBAI: Shares of Reliance Industries (RIL) erased early gains to close 1% higher on Thursday, as near-term concerns over earnings growth outweighed the feel-good sentiment arising out of the 1:1 bonus share issue.

The stock witnessed higher than usual volumes on both stock exchanges, but most investors used the opportunity to book profits for the time being.

On BSE, the stock closed at Rs 2,119.20, up Rs 20 over the previous close, after having touched Rs 2,209 early on in the session. Brokers expect the stock to trade in line with the broad market trend, at least till the run-up to its second quarter numbers.

“Lower refining and petrochem margins and higher capital charges will offset higher volumes from KG-D6 and RPET refinery in 2QFY10,” says a earnings preview note by brokerage house CLSA to clients last month.

“We estimate a 3% Q-o-Q (quarter-on-quarter) rise in RIL and RPET profits to Rs 3,850 crore and see downside risks to consensus FY10 EPS estimates even after the 5% downgrade since June. FY11 earnings are more relevant, but we find Reliance 19-55% more expensive than peers even on these estimates. Clarity on growth projects, inorganic or organic, will be crucial, therefore, to sustain stock performance by keeping the SOTP (sum of the parts) framework relevant,” the note adds.

RIL shares have been performed in line with the market over the past one month. The company’s ongoing legal battle with ADAG over gas supplies, and sluggishness in refining margins are among the key reasons why the stock has performed to the extent that most investors were expecting it to.

According to brokerage house Ambit, RIL’s blended gross refining margin for June-September is expected to be $6.5/bbl compared with $7.5/bbl during the preceding quarter.

“RIL’s profit is expected to grow marginally Q-o-Q, as increase in earnings from higher gas production and merger of the RPL refinery offset the fall in refining margins and petrochemicals’ EBIT,” brokerage house Edelweiss has said in its results preview note. Edelweiss has rated ONGC and GAIL as top picks in the oil & gas sector. Some feel the pull-back in RIL stock could be attributed to the overall weakness in the market on Thursday.

“The (bonus) announcement is particularly significant, after the recent sale of treasury shares by the company. This is because a section of the investors perceived the treasury share sales as a negative event, capping the stock price upside in the short term,” Angel Broking said in a note to its clients. The brokerage has a ‘buy’ rating on the stock.

Credit Suisse recently upgraded its rating on the stock to ‘outperform’ saying relative valuations of the stock were attractive. “While absolute valuations are clearly more demanding now, RIL’s forward P/E is currently at a 10% discount to MSCI India compared with a 55% premium in October 2008. EPS momentum means this discount will expand even if RIL moves with the market,” the brokerage said in a note to its clients last month.

 

[Pintu]

http://www.ptinews.com/news/327698_RIL--ADAG-surge-on-hopes-of-end-to-Ambani-dispute

RIL, ADAG surge on hopes of end to Ambani dispute

STAFF WRITER 18:54 HRS IST

Mumbai, Oct 12 (PTI) On hopes of truce between warring Ambani brothers, companies promoted by Anil and Mukesh notched up handsome gains on the Bombay Stock Exchange helping the benchmark index, Sensex, regain the 17,000-level.

However, Anil Ambani Group company RCOM closed down by 0.62 per cent at Rs 247.80.

Market heavyweight RIL, promoted by Mukesh Ambani, rose 3.19 per cent at Rs 2,167.10, while Anil's Reliance Infra gained a hefty 5 per cent at Rs 1,357, the second biggest gain among Sensex scrips today.

Marketmen said the latest development comes as a pleasant surprise for stocks of the group companies of both brothers as it comes days ahead of the Supreme Court hearing to be held on October 20.

"The entire Reliance pack got boost after one side called for a possible truce," SMC Global Vice President Rajesh Jain said.

Reliance Natural Resources went up 5.30 per cent to close at Rs 87.

 

[Pintu]

http://www.ptinews.com/news/327354_Markets-in-festive-mood--Sensex-up-384-points

Investors look at the screen, displaying the stock prices
at Bombay Stock Exchange. PTI Photo

Markets in festive mood, Sensex up 384 points

STAFF WRITER 17:10 HRS IST

Mumbai, Oct 12 (PTI) Markets today soared by over 380 points to regain the 17,000-level after the investor sentiment was bolstered by robust industrial production in August and hopes of a truce between warring Ambani brothers.

Markets witnessed frantic rally soon after the news of 10.4 per cent growth in industrial output, the highest in 22 months, came out. Brokers said atmosphere was euphoric with a slew of goods news adding to the festive cheer.

The Bombay Stock Exchange benchmark index, Sensex, opened on a strong note after Anil Ambani yesterday extended an olive branch for peace with elder Mukesh Ambani, fuelling investor hopes of an end to one of the most intense corporate battles.

The market also got support from Prime Minister Manmohan Singh's statement that the economic growth will accelerate.

Brokers said investors, fortunes of many of them are tied up with frims run by Ambani brothers, cheered the development.