SumanSpeaks: The Information Super Highway

GDP growth to bounce back to 5.5% soon : Sharma Mumbai, Aug 31:  Commerce and Industry Minister Anand Sharma has brushed aside the slide in India’s economic growth rate to 4.4 per cent in the April-June quarter, the worst in over four years. Arguing that the country’s growth story could not be written off as yet, he told a gathering of exporters in Mumbai that the gross domestic product (GDP) would bounce back to 5.5 per cent soon. “Wait for the next quarter. The country's foreign exchange reserves are at a satisfactory level. The Government's foreign debt is nearly nil,” he told the small group of exporters at the inauguration of the Federation of Indian Export Organisations’ new premises. Though the April-June 2013 quarter has recorded the worst quarterly growth in India’s GDP since the January-March quarter of 2009, the year of the global financial crisis, Sharma was categorical that it was nowhere like last time. He said the combination of large fiscal and current a...

Geometric Ltd : Buy CMP: Rs.75.15  (i) Highlights for the quarter ended June 30, 2013 (Q1 FY14) USD Revenue rises 1.4% Q-o-Q  In Rupee terms, consolidated revenues benefited from the depreciation of the Rupee to rise 5.3% Q-o-Q to INR 2,602.75 Mn from INR 2,471.26 Mn in the previous quarter. Geometric's revenue at the end of the corresponding quarter last year stood at INR 2,608.20 Mn. Reduction in attrition rate to 11% this quarter due to strong employee engagement focus EPS for the quarter is INR 2.44 The Company declared consolidated revenues of USD 46.45 Mn for the quarter as against USD 45.79 Mn in Q4FY13 and USD 47.80 Mn in Q1FY13. The operating profit for the quarter rose 55.7% Q-o-Q to INR 372.88 Mn compared to INR 239.53 Mn in the previous quarter. The company closed the quarter with Net Profit of INR 154.12 Mn as opposed to INR 111.00 Mn in Q4FY13 and INR 206.60 Mn in Q1FY13. Mr. Manu Parpia, Managing Director & CEO, Geometric Limited said...

MARKET MANTRA [Excerpts of my news-letter to the clients, sent today morning] Yesterday, the market was better than expected. Not only Nifty Traded with a positive bias, but it rallied strongly to settle above 5400 mark yesterday on the back of derivative expiry. It was a gap up opening followed by sustained up-move for entire day. Nifty made a high of 5429 before settling at 5409. Market is showing some signs of  revival. At lower levels buying is coming which is giving the much needed support to the Bulls. Nifty has bounced back 310 points from the low of 5118 within a few trading sessions. This has resulted into extreme volatility and unprecedented moves on the either sides. The best sector to focus now is Information Technology. Resistance : 5450 / 54700 Support : 5360 / 5300.  Nifty_Future Trading Strategy : For Friday, August 30, 2013, the trend deciding point emerges at 5358 mark. Since Nifty_future is seen reversing from this point and hence it can move towar...

Feature: A win-win deal for UltraTech and JP Associates Sharekhan Research/Mumbai 29, Aug 13 Photo , Courtesy : The Economic Ti mes Event : JP Associates-UltraTech deal for 4.8mt Gujarat cement plant in final stage According to media reports, JP Associates (JPA) after a long negotiation for more than one year to sell stake in its Gujarat cement plant is close to finalising a deal with UltraTech Cement (UltraTech). JPA had earlier transferred its cement plants located in Gujarat and Andhra Pradesh with a total installed capacity of 9.8mtpa to its wholly owned subsidiary, Jaypee Cement Corporation. Jaypee Cement Corp, as the new company is called, runs two plants in Sewagram, Kutch, and Wanakbori, Gujarat, each with a capacity of 2.4 million tonne, and a 5-million-tonne unit in Andhra Pradesh's Krishna district.  Deal value : EV/tonne of $120 (@Rs65/USD); lower than expected and at discount to recent deal values According to media reports, the deal with UltraTe...

Mid Market Chart Check [Excerpts of my mid-day inputs to the clients] Market experienced buying at lower levels. A gap down opening took the Nifty to a low of  5118.85 during first few hours of trade. However, strong buying at lower levels pulled it to a high of 5317.70. Finally it settled almost flat.  Due to over sold situation in short term and subsequent short cover, the  F&O expiry is expected to be closed in the positive today.  Since the morning, there has been relentless buying in the Indian bourses, after the INR appreciated against the USD. However, what is to be noted is that till now the rallies are proving to be short lived and are getting exhausted quickly. On the other hand lower level is attracting buying interest also. This has resulted into extreme volatility on the either side of the spectrum. However, it seems there are now some hope of Nifty going to 5700 levels by the end of September, which is normally a good month for the ...

AFTER MARKET OPENING CHART CHECK Photo , Courtesy : Faking News In an extremely bearish move following the passing of the FSB, the Nifty, it fell down to 5274 and closed with a huge loss of 189 points. A gap down opening was followed by sustained selling till end, with no respite, with a total absence of any intra-day upward correction. Market is in confirmed down trend and scary target of 4800-4900 are talked about in sundry analyst circles. Shares are making new lows every day and even BLUE CHIPS are now spared. Rallies are  generally short lived and get exhausted quickly. The pace of fall is much higher than rise the rise.  3-4 days of rally had been corrected by single day of fall. Much of the fall is due to self-inflicted pain created by our "Tughlak-ian" UPA Government and its anti--people policies. The main opposition BJP only gave Lip-opposition to the FSB (Ironically called, "Vote Security Bill"), which clearly indicates, what each political ...

Government approves Rs.1.83 trillion infrastructure projects to boost confidence Buy B F Utilitites Ltd (Rs.127.70), BHEL (Rs.118.20) and L & T (Rs.714) NEW DELHI: The Cabinet has approved infrastructure projects worth Rs 1.83 trillion ($28.38 billion), Finance Minister P Chidambaram said on Tuesday, part of a government drive to fast-track clearances and win back investor confidence. A cabinet panel cleared 18 power projects at a cost of Rs 83000 crore, Chidambaram told a news conference. Chidambaram emphasised that the government's highest priority is to restart the investment cycle. "Investment cycle has started and we are pushing it further," he said. As regards the fuel supply agreements (FSA) for the power projects, the Minister said all the FSAs would be signed by September 6. The earlier deadline of signing the FSA was August 31. Asked about the Food Security Bill, Chidambaram said that the government has provided enough money for it...

WINNING STROKES : THINK DIFFERENT Manappuram Finance Ltd hits another buyer freeze in the opening trade. The scirp got locked at the UC at Rs.16.05. The stock was repeatedly recommended last week, as a must buy. Gold prices would continue to remain buoyant in the Indian markets, due to import restrictions. Meanwhile, Shri V.P.Nandakumar, Managing Director & CEO said, that the changes in lending policies introduced by the RBI will strengthen the NBFC sector in the long run. Also, the company announced the following news yesterday: Manappuram Finance Limited has submitted to the Exchange a copy of the disclosure under Regulation 13(4) of SEBI (Prohibition of Insider Trading) Regulations, 1992 in relation to the purchase of 2, 52,000 equity shares of the Company by Mr. I Unnikrishnan, Executie Director and Dy. Chief Executive Officer of the Company, and 6,000 equity shares purchased by Mrs. Sathialekshmi. M jointly with Mr. I Unnikrishnan. (Source MSE). The Nifty_Futures moved ...

Hexaware Technologies snapped up by Baring for $420 mn In one of the largest deal in the information technology space, Baring Private Equity Asia on Friday agreed to buy a controlling stake in domestic outsourcing services provider Hexaware Technologies for about $420 million. Hexaware develops software and provides business process outsourcing services to overseas clients. In the first stage Baring will pick up a 41.8% stake in the company — 27.7% from promoter entities led by Atul Nishar and 14.1% from private equity firm General Atlantic (GA) — for about $260 million. Baring will then have to make a mandatory open offer to Hexaware’s minority shareholders for up to 26% of the company at Rs 135 a share, which would be worth $160 million. Though the deal will mark the exit of promoter Nishar and GA, the former will continue as non-executive chairman and PR Chandrasekar will continue as chief executive. The deal has been structured in a manner that Baring will pay the p...

Buy Bharat Forge CMP: Rs.228.80 Introduction : Bharat Forge Limited (BFL), the Pune based Indian multinational is a technology-driven global leader in metal forming having trans-continental presence across a dozen manufacturing locations, serving several sectors including automobile, power, oil and gas, rail & marine, aerospace, construction & mining, etc. Part of Kalyani Group - a US $ 2.5 billion conglomerate with 10,000 global work force; BFL today has the largest repository of metallurgical knowledge in the region and offers full service supply capability to its global marquee customers from conceptualization to product design, engineering, manufacturing, testing and validation. Shareholding Pattern : The promoters hold 42.05% of the shares of the company, while, the general public holds 57.95%. Among the general public, it has been seen that DIIs have increased their stake both on Q-o-Q basis and also sequentially; while there has been a marginal increase i...

Rupee crisis : Chidambaram meets FIIs, top bankers to discuss capital flows Mumbai: Finance minister P. Chidambaram on Saturday met foreign institutional investors (FIIs) and top bankers to discuss how to improve capital flows into the country. Bankers present in the meeting included the heads of State Bank of India, ICICI Bank Ltd, HDFC Bank Ltd, Bank of India, Bank of Baroda, Citibank and Axis Bank Ltd. Coming out of the meeting, ICICI Bank managing director Chanda Kochhar told said the meeting was “mainly to seek ideas and suggestions on what can be done about capital flows”. State Bank of India chairman Pratip Chaudhuri said bankers and FIIs discussed the present market conditions and the steps taken by the government to contain the fiscal and current account deficits. The government earlier this month had announced a series of measures, including giving more play to foreign investors in the domestic bond market to attract dollars inflows. The rupee touched its l...

RBI buys Rs.6,231 crore worth of bonds The move is aimed at putting money back into the banking system and cooling off bond yields Mumbai: The Reserve Bank of India (RBI) on Friday bought Rs.6,231 crore worth of bonds from the secondary market in its first bond buy-back programme since it tightened liquidity in mid-July, to put money back into the banking system and cool off bond yields. The offer was to buy up to Rs.8,000 crore of bonds. Details of the bond auction, published on the RBI website, showed the central bank bought the bonds almost in line with the prevalent market price. RBI offered to buy four securities maturing between 2022 and 2030, including the benchmark 10-year bond maturing in 2023, which was trading at 8.24% before the cut-off results were published. The cut-off yield at which RBI bought this bond was at 8.2571%, auction results showed. The yields on this 10-year bond closed at 8.2635% at 5pm. RBI had offered to buy bonds from the se...

Yellow metal price rise revives fortunes for gold loan NBFCs ~By Sangeetha G.    Aug 21 2013 , Chennai Less aggressive push from banks, duty hikes assisting growth After a year of uncertainties post the Reserve Bank of India (RBI) restrictions, gold loan companies have started showing signs of revival in one way or other. Lesser aggression from banks and rebounding gold prices are bringing back customers to gold loan companies. The recent import duty hikes also have been beneficial for gold loan business. Since the beginning of last financial year, the key indices, including net profit, assets under management, operating income and quarterly disbursement of Manappuram Finance have been on a downward trail. The RBI cap on loan-to-value (LTV) had hit the company, which has been lending at higher LTV. Muthoot Finance still managed to grow, though slower, after the RBI restrictions, as it has been lending at a relatively lower LTV. However, the gold holdings of the comp...

Gold Jumps to 11-Week High as Housing Spurs Stimulus Bets Gold jumped to a 11-week high after sales of new U.S. homes fell more than forecast, boosting speculation that the Federal Reserve will maintain fiscal stimulus to aid the economy. Platinum rose to a four-month high. Sales of newly built homes in July plunged more than 13 percent, the most in more than three years, government data showed today. The 394,000 annualized pace compared with a drop to 487,000 forecast by analysts in a Bloomberg survey. Fed policy makers said they are “broadly comfortable” in scaling back debt purchase if the economy strengthens. “The new home-sales data tells us that all is not well with the economy, and the Fed needs to continue to support growth,” Tom Power, a senior commodity broker at R.J. O’Brien & Associates in Chicago, said in a telephone interview. “The housing recovery is an important thing that the Fed will be looking at when it makes its decision on the timing of the tapering.” Go...

Manappuram moves to new corporate office Kochi, Aug. 23:  Manappuram Finance, one of the leading gold-loan companies in the country, has a new corporate office. On Friday, Maharashtra Governor K. Sankaranaryanan, formally opened the new corporate office at Valapad in Thrissur district. He noted that just because the value of the rupee has gone down recently the Indian economy would not collapse as some doomsday predictions had made out to be. He recalled that while hundreds of banks in the US and Europe had folded up in the wake of the global economic slowdown, none of the banks in India had closed, signalling the strength of the country’s banking system as well as of the economy. V.P. Nandakumar, managing director and chief executive officer of the company, recalled that Manappuram Finance had its humble beginnings at the village of Valapad. Courtesy : The Hindu Business Line

Emerging market stocks rebound with currencies as metals advance The MSCI Emerging Markets Index climbed 0.7% to 928.85 at 9.52am in London, trimming this week’s decline to 3.1% ~Stephen Kirkland  and   Pratish Narayanan London/Singapore, Fri, Aug 23 2013: Emerging-market stocks rose for the first time in seven days and currencies from India’s rupee to the Turkish lira rebounded. Metals gained while European stocks and US equity-index futures were little changed. The MSCI Emerging Markets Index climbed 0.7% to 928.85 at 9.52am in London, trimming this week’s decline to 3.1%. The Stoxx Europe 600 Index gained less than 0.1% and the Standard and Poor’s 500 Index futures fell 0.1%. The rupee and the lira rallied from record lows. The yen weakened on speculation Bank of Japan governor Haruhiko Kuroda will reiterate the case for unprecedented monetary easing at the Federal Reserve’s annual conference in Jackson Hole, Wyoming. Copper advanced 0.5%. Fed Bank of Dallas pre...

Paul Krugman | This age of bubbles ~Paul Krugman [ Editor : Dr.Paul Krugman says, "In fact, count me among those who believe that the biggest threat right now is that policymakers in emerging markets will overreact—that their central banks will raise interest rates sharply in an attempt to prop up their currencies, which isn’t what they or the rest of the world need right now". He is absolutely right and this what I have also been saying, since the last couple of months] So, another BRIC hits the wall. Actually, I’ve never much liked the whole “BRIC”—Brazil, Russia, India, and China—concept: Russia, which is basically a petro-economy, doesn’t belong there at all, and there are large differences among the other three. Still, it’s hard to deny that India, Brazil, and a number of other countries are now experiencing similar problems. And those shared problems define the economic crisis du jour. What’s going on? It’s a variant on the same old story: investors loved these...

WINNING STROKES : THINK DIFFERENT Please Click on the Chart to Expand MCX Ltd hits the buyer freeze in the opening trade. Those who have taken risk yesterday, must be happy. But, safe investors, should be very careful playing these kinds of counters. Today, the stock got locked in the UC, at Rs.293.05 in the  NSE. Manappuram Finance Ltd recommended yesterday at Rs.14.80-15, today broke out its long term chart pattern and is moving towards the next intermediate target of Rs.17.50-17.70, before touching Rs.21, in the next few trading sessions. With import restrictions on, the price of Gold is not expected to come down very quickly. In such a scenario, the companies like Manappurram Finance Ltd is expected do well. The scrip today closed at Rs.15.30. CLICK HERE & CLICK HERE . B F Utilities Ltd confirmed the break-out today, in the daily charts. It seems on Monday it will open a gap up and try to move towards the next target of Rs.145-147, and then subsequently cross R...

Cabinet clears ‘generation-based incentive’ for wind power projects The Indian Stock Market is yet to factor in this SUPERB news, for the Wind Power Sector Chennai, Aug. 13:  The Centre has formally approved the ‘generation-based incentive’ scheme for wind power projects — a promise that was made by Finance Minister P. Chidambaram in his Budget speech of 2013-14. The scheme was approved by the Union Cabinet of Ministers which met on August 1, sources in the know told Business Line. It is learnt that the Government of India will provide an incentive of 50 paise per kWhr of electricity generated by wind projects registered under the scheme. The incentive will, however, stop once the payout reaches Rs 1 crore per MW of capacity. The incentive of Rs 1 crore can be drawn in not fewer than four years and not more than 10. In his Budget speech, the Finance Minister had said that he would provide Rs 800 crore towards the scheme. It is understood that the scheme will take ef...

  Consumption of Wind Energy Composites forecast to grow 12.8% pa between 2013 and 2018 An enormous opportunity for raw materials used in the fabrication of fiber-reinforced plastics (FRP) products exists in the Indian Wind Energy Industry, as per Composite Insights. The demand for composite materials in Indian Wind Energy Industry continued its growth momentum till 2011. However, in 2012, the industry was affected by the withdrawal of two key incentives by the government: accelerated depreciation and generation-based incentive. In 2012, India was the fourth largest wind market in the world, with around 1700 MW new capacity addition. With a generation-based incentive of 50 paise per unit being introduced in the Union Budget, India’s wind power capacity is poised to grow between 2013 and 2018. It is estimated by Composite Insights that more than 22 gigawatt of wind power capacity will be installed during this six year period. The primary drivers continue to global wa...

India To Launch National Offshore Wind Energy Authority Soon August 22nd, 2013: India is set to take a definite step towards opening the offshore wind energy sector to the developers. After deliberations for several months, the Ministry of New & Renewable Energy (MNRE) is set to launch the National Offshore Wind Energy Authority (NOWA) to proliferate deployment of offshore wind energy projects in the county. The National Offshore Wind Energy Authority will be responsible for carrying out resource assessment along the country’s coastline and survey potential project sites in the Exclusive Economic Zones in the territorial waters. India is the fifth largest wind energy market in the world, in terms of installed capacity, with over 19,500 MW capacity installed as of 30 June 2013, accounting for about 65% of the total installed renewable energy capacity in the country. Scottish Development International had conducted offshore wind energy assessment in the southern state of ...