Market on a firm uptrend: Tuesday Closing Report

The Nifty’s next move is to 5,495 and then to 5,610

Sustained buying by institutional investors and a positive global trend led the market higher for the third successive day. This was also the third successive day that the Nifty made a higher high and higher low. We may now see the benchmark reaching the level of 5,495 and further to 5,610. The National Stock Exchange (NSE) saw a much higher volume of 80.09 crore shares, underlining bullishness.  

Extending its gains for the third day, the market opened on a firm note on positive cues from its Asian peers. The US markets closed flat ahead of the Federal Open Market Committee (FOMC) meeting, which is expected to announce its monetary policy decision later today. Back home, the Nifty opened at 5391, up 31 points over its previous close, and the Sensex gained 92 points to resume trade at 17680. The opening figures on both benchmarks were their intraday lows.

Across-the-board buying since the start of the session saw all sectoral gauged in the green in early trade. The market traded sideways in the positive for the entire session with the indices hitting their intraday highs in post-noon trade. At the highs, the Nifty touched 5,439 and the Sensex scaled 17,843.

The RBI’s move to boost liquidity through the CRR cut last week helped rate-sensitive sectors like metals, oil & gas, realty and power log good gains. The market finally closed near the highs of the day. The Nifty settled 70 points higher at 5,430 and the Sensex surged 226 points to end trade at 17,814.

The advance-decline ratio on the NSE was positive at 1203:590.

Among the broader indices, the BSE Mid-cap index gained 1.21% and the BSE Small-cap index rose 1.03%.

All sectoral indices settled higher today led by BSE Metal (up 3.01%). It was followed by BSE Oil & Gas (up 2.60%); BSE Realty (up 2.11%); BSE Power (up 1.52%) and BSE Capital Goods (up 1.51%).

Sterlite Industries (up 5.06%); GAIL India (up 4.50%); Jindal Steel (up 3.80%); ONGC (up 3.42%) and Reliance Industries (up 2.72%) were the top gainers on the Sensex. The major losers were Wipro (down 1.29%); Mahindra & Mahindra (down 1%); Bajaj Auto (down 0.43%); Tata Motors (down 0.21%) and ICICI Bank (down 0.01%).

The top performers on the Nifty were Sterlite Ind (up 5.18%); Sesa Goa (up 5.16%); SAIL (up 5.03%); GAIL India (up 4.53%) and Jaiprakash Associates (up 4.39%). The main laggards were Wipro (down 1.66%); M&M, Reliance Infrastructure (down 0.93% each); Tata Motors (down 0.49%) and HCL Technologies (down 0.07%).

Asian markets settled mostly higher on hopes that European policymakers will finalise a second bailout for Greece. Besides, likelihood of the US Fed keeping interest rates unchanged also supported investor sentiment.

 The Hang Seng climbed 0.97%; the Jakarta Composite rose 0.53%; the Nikkei 225 added 0.09%; the Straits Times gained 0.91%; the Seoul Composite advanced 1.13% and the Taiwan Weighted surged 1.31%. Bucking the trend, the Shanghai Composite lost 0.19% and the KLSE Composite settled 0.05% lower. At the time of writing, the key European markets were up between 0.77% and 1.11% on positive economic news from Germany. At the same time, the US stock futures were in the green, ahead of the Fed announcement.

Back home, institutional investors—both foreign and domestic—were net buyers in the equities segment on Monday. While foreign institutional investors invested Rs1,298.64 crore in stocks, domestic institutional investors pumped in Rs203.32 crore in shares.

IT major Infosys has signed a multi-year, multi-million dollar contract with pharma major GlaxoSmithKline to optimize digital channels across its global consumer healthcare and pharmaceuticals business lines. The partnership will simplify and improve effectiveness of how GSK delivers digital content online, it said on Tuesday. Infosys gained 1.51% to close at Rs2,860.05 on the NSE.

Tata group's retail arm Trent today said its board has approved a proposal to raise up to Rs250 crore through placement of shares with institutional investors. The company's board has decided to open a QIP (Qualified Institutional Placement) issue of Rs225 crore with an option of hiking the size up to Rs 250 crore in aggregate, by way of issue of equity shares, Trent said in a filing to the BSE. The stock closed 1.895 higher at Rs924 on the NSE.

Compucom Software has been awarded an ICT project by Bihar State Educational Infrastructure Development Corporation (BSEIDC), valued at Rs46.71 crore. The project is for providing computer education on BOOT basis in 336 government schools in the state. With this order, the company now has 6,418 government schools under its umbrella across north India. The stock closed at Rs12.30 on the NSE, down 1.20% over its previous close.


Fare hike in Rail Budget looks remote

While railway minister Dinesh Trivedi is not likely to tinker with second class fares in his maiden budget, there is speculation that the budget could bring in a safety cess following the recommendation of the Kakodkar Committee on issues relating to safety

New Delhi: The Rail Budget to be presented on Wednesday may continue with the practice of not raising the fares and freight rates but the possibility of imposition of a safety cess may not be ruled out, at least on the higher class fares, reports PTI.
As Trinamool Congress leader and railway minister Dinesh Trivedi rises to present his maiden budget, he is expected to carry on with the practice of not tinkering with the second class fares like his predecessors, including TMC member and West Bengal chief minister Mamata Banerjee, over most part of the last decade.

There is speculation that the budget could bring in a safety cess following a recommendation by the Kakodkar Committee report which went into issues relating to safety over the huge railway network.

The committee had suggested a cess to realise money to the tune of Rs5,000 crore, to fund projects especially for safety upgradation of signalling and telecommunication systems.

As he does the tight ropewalk, Mr Trivedi may also introduce a mechanism to provide cushion for meeting costs on account of any spike in fuel prices. There is a suggestion for introducing a fuel adjustment component (FAC) in the basic fare to insulate railways from fuel price hike.

While the thrust of the budget would be on upgradation of infrastructure on 19,000 km of trunk route, Mr Trivedi could announce introduction of ‘train sets’ for the busy Delhi-Mumbai corridor to reduce travel time.

A train set comprises single rake with locomotive and coaches attached together. The venture may take more than four years to fructify but the budget announcement will set the ball rolling.

The budget is expected to have a proposal for introducing a bullet train for Rajasthan on the Delhi-Jaipur-Jodhpur corridor. This corridor could be linked to the proposed Pune-Ahmedabad high-speed corridor.

Unlike previous years, less number of new passenger trains could be announced.

Mr Trivedi could announce some measures to improve passenger amenities including the catering service in trains and stations and proposals for manufacture of ‘green’ toilets to improve on the current system.

The railway minister is likely to unveil an action plan for upgradation of signalling and telecommunication system to prevent accidents. Installation of train protection warning system (TPWS) and in-cab signalling system are likely to be announced in the Rail Budget 2012-13.

The budget will focus on manufacturing of modern LHB coaches as the Railways intends to replace all conventional coaches in all types of trains.

There will also be proposals for manufacturing of high horse power (5500 HP) locomotives in the next fiscal.

The Railways freight loading target of 993 million tonnes in the current financial year is unlikely to be met, according to available indications. Till February, the national transporter has carried 875.60 MT.


Public Interest Exclusive
Mumbai Metro project attracts modifications by Centre

Following a Moneylife article published on the Mumbai Metro project, and its wide distribution among all stakeholders, the Centre has sought modifications

 “Mumbai Metro Line 3 – Some Questions need to be asked” published about a fortnight back in these columns seems to have had its effect. Certain modifications have been sought by the ministry of urban development, Government of India. However the key question of implementing the Mumbai Metro has not been addressed. There seems to be no integrated plan of the Metro project as it seems to be encountering one hurdle after the other which could have been envisaged in advance but has not been done. Even the Dadar railway station makeover seems to be only a makeover plan and does not envisage getting the Western Railway and Central Railway tracks and trains integrated.

The last week of February was quite an interesting week from the Mumbai’s transportation infrastructure and urban development perspectives. Firstly, the week began with the team from Government of Maharashtra (GoMah) and Mumbai Metropolitan Region Transport Authority (MMRDA) visiting Delhi to get the green signal from the finance ministry, Government of India (GoI)–after all the latter were to provide 15% of the project cost of Rs21,000 crore for the 37.5 km Colaba-BKC-Airport-SEEPZ fully underground Metro rail line (Line No 3 of the Mumbai Metro Master Plan) which would be the first underground Metro rail service in Mumbai. Several questions are needed to be asked before proceeding with the project. Even the very need of such high end expensive poorly serving infrastructure is needed to be investigated. This column had thrown up several questions in the recent past article. That article had highlighted the inadequacy of capacity, very high costs and very long duration for implementation. Apparently the team came back with a tentative nod—what that means is anybody’s guess. However, what seems to be certain is that the team from Mumbai was asked to consider running nine coach trains and get back to them. This seems to be a stalling game or face-saving option to the team. By running nine coach trains with capacity of 300 per coach running every three minutes would mean a throughput of 60/3 x (9 x 300) = 54,000 pphpd and two of these routes would make it 108,000 pph as against the need of 1,80,000 pph. 300 persons per coach actually means a crush density of six standing persons per square meter. The coach is to be designed for a peak period crush load of eight standing persons per square meter. This comes to 360 persons per coach along with the seated commuters. This brings the capacity to 9 x 360 x (60/3) x 2,  i.e. about 1,30,000 pph for two routes, much closer to the required capacity of 1,80,000 pph yet 50,000 pph in short supply. Alas, it will be available only about 30 years hence.

What does that mean? It simply means longer underground station lengths and longer rakes and larger stabling yards and car sheds; higher capacity of disaster mitigation and management (DMM) facilities and maintenance manpower, etc. It means nearly 50% higher costs. Since fare-box collection will not be able to meet even the operating expenses and recovery of investment is possible through realty development, naturally it will be possible only by further densification of the already dense city. Thus the requirement is being increased, but not commensurate with the increase in capacity which has a shortfall in any case. Did the ministry of urban development and ministry of finance raise any of the points raised in the said column?

The referred article was in fact sent to all stakeholders; Government of India and Maharashtra, MMRDA and also Maharashtra chief minister Prithviraj Chavan. Apparently the points raised therein were taken up for discussion and there is hope that some positive steps would be taken to make the transportation sustainable in Mumbai, that importance will be given to walking, cycling and the BRTS.

Following the news on Line 3 came the news that Line No 2 of the MMMP from Charkop to Mankhurd via Bandra may altogether get cancelled because it has to go underground or on the surface in the vicinity of the Juhu Aerodrome. The 32 km elevated metro will be too expensive to go underground despite the knowledge that if one includes socio-economic costs, underground Metro is a better option.

By this date in 2012, Line 1, Line 2 and Line 3 should have been in operational stage; the reality is that even Line 1 may not get ready by 2013.

Going by the crowd considered in the Metro to show how it will reduce the load on railways, it is going to be nowhere near as comfortable to travel as being projected. In fact in Delhi Metro peak time travel, the crowd must have been barely four persons per sq meter when the air-conditioning failed to function well. It will be dreadful to imagine how uncomfortable travel will be in Mumbai when the load is even six persons per sq meter crush load, leave aside 8 p/m2 peak crush load.

There is good news in the transportation sector in connection with accessibility of railway system to Persons with Disability (PwD). The public interest litigation (PIL) on this matter in the Bombay High Court came for hearing. While The Persons with Disabilities (Equal Opportunities, Protection of Rights and Full Participation) Act came into existence in 1996, the details of physical built environment was prepared by Central Public Works Department (CPWD) of the ministry of urban development (MoUD) only in 1998 and around the same time even the Research, Designs, Standards Organisation (RDSO) of the ministry of railways brought out their standards. Railways have not been following this Standard uniformly. To assist railways, especially the Western Railway and the Central Railway on their suburban services in Mumbai, in planning and implementing as well as monitoring, a high court committee has been formed comprising of the two petitioners, one of whom is blind and the other is wheelchair-based, four persons with technical and architectural expertise, four officers from WR and CR each and one from the RDSO. Optimism prevails in that the committee will work towards the set objective sincerely, systematically, diligently and over a finite time, make the railway system accessible to PwD. If the system is adequately friendly towards PwD, travel to other commuters will also be easier, provided of course the overall commuter demand does not exceed so exorbitantly as at present. Plans are afoot to increase transportation capacities significantly by way of Metro rail, BRTS, etc, to reduce excessive load on the railways.

While CR suburban trains running on the WR tracks is limited only to the Harbour Line from Mahim to Andheri, the twain do not criss cross at Dadar although they do come sufficiently close to each other to do this switchover. For some similar reason the Suburban Main and Harbour Lines do not cross over to facilitate Fast Local from CST to Kurla and Navi Mumbai. Whatever these reasons are, they are not widely known—perhaps not known at all! However, the good news is that the Dadar stations of WR & CR will undergo a sea change when they build roof plazas and 25 entry points. It is hoped that it will be friendly to PwD. Also, while it is expected to provide parking space for 800 cars, it will provide enough space for bicycle parking. It is also hoped that the planners will consider a roadway at the plaza-level parallel to the tracks, starting from the Tilak Bridge and connecting the Elphinstone Bridge on which there will be an up and down dedicated bus lane and a lane with no halt for cars. Only the cars which are parked in the parking lot will be allowed to use this lane.

Actually space for car parking should not be there at all. Parking facility for bicycles and at most motorized two-wheelers should be provided with parking facility. Of course, a bicycle lane must also be provided. It is naturally expected that a plaza will have adequate walking infrastructure. At the same time they should connect the WR and CR tracks have crossings so as to enable western suburbs’ commuters come up to CST and eastern suburbs’ commuters go up to Churchgate. At the same time have a ‘reversing’ platform whereby, like that at Wadala, so that eastern suburbs get access to western suburbs and vice versa without having to alight and cross over the FOB, etc.

(Sudhir Badami is a civil engineer and transportation analyst. He is on Government of Maharashtra’s Steering Committee on BRTS for Mumbai and Mumbai Metropolitan Region Development Authority’s Technical Advisory Committee on BRTS for Mumbai. He is also member of Research & MIS Committee of Unified Mumbai Metropolitan Transport Authority. He was member of Bombay High Court appointed erstwhile Road Monitoring Committee (2006-07). While he has been an active campaigner against noise for more than a decade, he is a strong believer in functioning democracy. He can be contacted on email at [email protected])


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