Ratan Tata has handed over the baton to his successor, Cyrus Mistry, after 21 years. How have the five top stocks at that time -- Tata Steel, Tata Motors, Indian Hotels, Tata Tea and Indian Hotels -- done over two decades under Mr Tata? Well, despite his bold moves across the group just one stock, Indian Hotels, has created more value than Sensex in all these years!
The table below highlights the total compounded shareholder returns between 1991 and 2012 of various Tata companies and the BSE Sensex.
Tata Steel: Among the worst performers of these five companies was Tata Steel. The company has returned just 9.57% compounded annual total in 21 years. While the company used to be well-run company and was often termed ‘boring’, it made a fatal mistake of acquiring Corus, a UK-based steel company for over $7 billion at the height of the business cycle. This is a commodity business with low margins. To break even would take years, assuming the steel industry does exceedingly well and consistently for a long time.
The indices continue to trade in an extremely narrow range. It is about to break out soon may be in the first few trading days of the New Year
The market settled lower amid range-bound and volatile trade on weak global cues as the world waits for a solution for US’ fiscal woes. The indices continue to trade in an extremely narrow range. It is about to break out soon may be in the first few trading days of the New Year. The National Stock Exchange (NSE) reported a volume of 54.54 crore shares and advance-decline ratio of 808:621.
The Indian market opened flat with a negative bias reflecting a mixed trend in the Asian which were open today. Investors were cautious as US policymakers failed to arrive at a consensus for a budget deal, adjourning the talks for Monday. Failure to sew a deal would lead to additional taxes and spending cuts that come into effect from Tuesday.
The Nifty opened seven points lower at 5,901 and the Sensex started the day at 19,423, down 22 points from its previous close. Select buying in opening trades pushed the market to the day’s high. At the highs, the Nifty touched 5,919 and the Sensex went up to 19,492.
However, the market could not sustain the early lead with the benchmarks paring their gains and hovering on both sides of their previous closing levels. Selling pressures in blue chips like HDFC, ICICI Bank, Larsen & Toubro and TCS pushed the indices into the negative in late morning trades.
The market touched the lows in noon trade as selling intensified. The Nifty fell to 5,897 and the Sensex slipped to 19,409 at their respective intraday lows. The benchmarks continued to remain in the red on a mixed opening of the key European markets.
The market ventured into the positive for a brief moment at around 2.30pm but the gains were short-lived as sellers pushed the market lower again.
The volatile market settled marginally lower on weak global cues as a US budget deal looks impossible. The Nifty slipped three points (0.06%) and the Sensex fell 18 points (0.09) to close the last trading day of 2012 at 19,427.
The Nifty ended the calendar year 2012 with a gain of 28% while the Sensex closed the year up 26%.
While the Sensex settled marginally lower, the broader indices settled in the positive. The BSE Mid-cap index gained 0.28% and the BSE Small-cap index climbed 0.51%.
The top sectoral gainers were BSE Realty (up 1%); BSE Consumer Durables (up 0.80%); BSE PSU (up 0.59%); BSE Power (up 0.47%) and BSE Auto (up 0.42%). The main losers were BSE Capital Goods (down 0.33%); BSE Fast Moving Consumer Goods (down 0.27%); BSE IT and BSE TECk (down 0.05% each).
Seventeen of the 30 stocks on the Sensex closed in the positive. The chief gainers were Tata Power (up 1.19%); GAIL India (up 0.98%); Hindalco Industries, Tata Motors (up 0.89% each) and Hindustan Unilever (up 0.83%). The key losers were ITC (down 0.88%); Larsen & Toubro (down 0.76%); Maruti Suzuki (down 0.75%); Cipla (down 0.55%) and HDFC (down 0.53%).
The top two A Group gainers on the BSE were—TTK Prestige (up 4.21%) and Gitanjali Gems (up 4.02%).
The top two A Group losers on the BSE were—Suzlon Energy (down 3.89%) and Mahindra & Mahndra Finance (down 3.07%).
The top two B Group gainers on the BSE were—Indian Hume Pipe Company (up 19.97%) and Veer Energy Infrastructure (up 19.95%).
The top two B Group losers on the BSE were—Tuni Textile Mills (down 19.99%) and Karuturi Gobal (down 14.37%).
Out of the 50 stocks listed on the Nifty, 27 stocks settled in the positive. The chief gainers were Punjab National Bank (up 3.35%); DLF (up 2.18%); ACC (up 1.60%); GAIL (up 1.20%) and Tata Motors (up 1.19%). The top losers were HCL Technologies (down 1.37%); ITC (down 1.11%); TCS (down 1.08%); IDFC (down 0.98%) and L&T (down 0.93%).
Markets in Asia settled mixed on uncertainties over the US budget deal. The region witnessed thin trading as some markets were closed today while others closed early.
The Shanghai Composite surged 1.61% and the KLSE Composite climbed 0.45%. On the other hand, the Hang Seng lost 0.04% and the Straits Times settled 0.77% lower. Markets in Indonesia, Japan South Korea and Taiwan were closed for trade today.
At the time of writing, CAC 40 of France was up 0.29%; DAX of Germany declined 0.57% and UK’s FTSE 100 was 0.47% lower. At the same time the US stock futures were trading marginally higher.
Back home, foreign institutional investors were net buyers of stocks totalling Rs833.40 crore on Friday while domestic institutional investors were net sellers of equities aggregating Rs530.35 crore.
Pharma major Suven Life Sciences today said it has received three product patents for CNS molecules, two from Eurasia and one from Canada, which could be used for treating various central nervous system disorders. The company has received approval for molecules that could be used in the treatment of neurodegenerative disorders like Parkinson's, Alzheimer's and Schizophrenia. The stock closed 1.65% higher at Rs30.85 on the NSE.
Ramky Infrastructure has secured finances worth Rs1,225 crore for its Agra-Etawah road project in Uttar Pradesh, the company said today. An agreement to this effect was signed between Agra Etawah Tollways, a special purpose vehicle (SPV) formed to undertake the project and consortium of bankers led by Oriental Bank of Commerce and other participating lenders on December 29, 2012, the company said in a statement. Ramky climbed 2.68% to close at Rs99.70 on the NSE.
Tecpro Systems has bagged a Rs95-crore order from South Korea’s SK Engineering and Construction (SKEC) for supply of the entire coal and fly ash handling systems for a power plant that it is building in the US. Tecpro declined 1.95% to close at Rs145.80 on the NSE.