L&T wins Rs716 crore infrastructure order from UAE

Infrastructure major Larsen & Toubro (L&T) Ltd said its construction division has won an order worth Rs716 crore from the Department of Transport, Abu Dhabi, for construction of Sheikh Khalifa Interchange.

The scope of work includes construction of four bridges to be completed in two years, L&T said in a filing to the Bombay Stock Exchange (BSE).
On Friday, L&T gained 0.45% to Rs2,020.10 on the BSE, while the benchmark Sensex declined 0.13% to 19,966.93 points.

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Cement players see sharp fall in sales in November

Cement sales in November were 19% lower month-on-month for seven cement players that make up half of the industry capacity. According to CLSA, some of the key reasons were inventory build-up, a prolonged monsoon and no major pick-up in infra projects. It expects cement prices to slip lower

The most important implication of weak month-on-month cement despatches will be on prices, says CLSA. In a report to its clients today, CLSA said, "Our interactions with industry participants indicate that cement prices, across regions, have corrected by 2-5% in the last 2-4 weeks. The drops have been higher in north/central compared to south/west. Dealer feedback indicates that in case demand growth continues to remain sluggish, there is a possibility of further pressure on prices in the next few weeks."

CLSA remains concerned about sector fundamentals and maintains an underweight rating on the sector. For individual stocks, it has a 'sell' on Ambuja Cement and 'underperformer' on ACC and UltraTech. It is relatively positive on Shree Cement, as it believes valuations are reasonable and that the company has increasing earnings from power, and Grasim for its strong viscose staple fibre (VSF) business and high holding company discount.

According to CLSA's calculations, Grasim trades at a price-to-earnings multiple (FY12) of 11 times, Ambuja and UltraTech at 17 times, and ACC at 18 times. Among mid-caps, India Cement trades at 24 times and Shree Cement trades at 11 times.

In terms of EV/tonne, CLSA estimates Grasim to be at $70, Ambuja at $165, ACC at $129, UltraTech at $135, India Cement at $80 and Shree Cement at $82.

In November, ACC reported a 5% y-o-y rise in despatches due to a low base and also because it commissioned new capacity. Ambuja reported a fall, partly because of the transporters' strike in north India that impacted its Himachal unit. Jaiprakash's volumes were up 13% y-o-y, but CLSA points out that the low base effect will no longer be there from December.

Grasim's shares fell to a low of Rs2,144 recently, but the price has moved up subsequently to Rs2,345. The Ambuja stock price fell to a low of Rs133 recently and has not recovered much since then. ACC too has not recovered much from a recent low of Rs968. UltraTech is languishing at around Rs1,100 levels. India Cements has recovered from its recent low of Rs95 and is at Rs 108. Shree Cement, too, has recovered a bit from its recent low.

(This article is based on secondary research. The report is for information only. None of the stock information, data and company information presented herein constitutes a recommendation or solicitation of any offer to buy or sell any securities. Investors must do their own research and due diligence before acting on any security. Some of the opinions expressed in this article are the author's own and may not necessarily represent those of Moneylife).

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Personal finance Friday

Birla Sun Life MF unveils 366 days Fixed Term Plan; DSP BlackRock MF floats FMP–12M–Series 10; Fidelity MF introduces 93 days plan

Birla Sun Life MF unveils 366 days Fixed Term Plan

Birla Sun Life Mutual Fund has launched Birla Sun Life Fixed Term Plan–Series CJ, a close-ended income scheme.

The plan seeks to generate income by investing in fixed income securities maturing on or before the duration of the scheme. The plan will have duration of 366 days. The plan will have dividend (payout) and growth option.

The new issue opens on 3rd December and closes on 10th December. The exit load on the plan is nil. The minimum investment amount is Rs5,000.

CRISIL Short Term Bond Fund Index is the benchmark index. Kaustubh Gupta will be the fund manager.

DSP BlackRock MF floats FMP–12M–Series 10

DSP BlackRock Mutual Fund has launched DSP BlackRock FMP–12M–Series 10, a close-ended income scheme.

The investment objective of the plan is to generate capital appreciation by investing in debt and money market securities which will mature on or before the date of maturity of the plan. The duration of the plan is 12 months. The exit load for the scheme is nil. The plan will have dividend (payout) and growth option.

The new issue closes on 10th December. The minimum investment amount is Rs10,000.

CRISIL Short Term Bond Fund Index is the benchmark index. Dhawal Dalal is the fund manager.

Fidelity MF introduces 93 days plan

Fidelity Mutual Fund has launched Fidelity Fixed Maturity Plan Series IV–Plan C, a close-ended income scheme.

The investment objective of the plan is to generate reasonable returns and reduce interest rate volatility primarily through investment in money market and short to mid term debt instruments having maturity, on or before the date of maturity of a plan.

The tenure of the plan is 93 days. The exit load on the plan is nil. The plan offers growth and dividend option. The new issue opens on 3rd December and closes on 6th December. The minimum investment amount is Rs5,000.
The plan will be benchmarked against CRISIL Liquid Fund Index. The plan will be managed by Shriram Ramanathan and Mahesh Chhabria.

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