Close above any day’s high may reverse the current mild downtrend
The weakness persisted on the Indian markets, as we had suggested in the Friday's market report, pulling the benchmarks to hit a five-day low (including today) and closing in the negative for the second consecutive session. We expect the market to move sideways to mildly down.
The BSE 30-share Sensex opened at 22,718 and immediately hit the day’s high at 22,721 while the NSE 50-share Nifty opened at 6,779 and hit the high at 6,786. Sensex slipped lower to hit the low of 22,597 and closing at 22,632 (down 56 points or 0.25%) while Nifty hit a low of 6,750 and closed at 6,761 (down 21 points or 0.32%). The NSE recorded a lower volume of 77.67 crore shares.
The top five gainers among the other indices on the NSE are Pharma (1.66%), Nifty Midcap 50 (1.47%), P S U Bank (1.33%), Midcap (0.72%) and Realty (0.66%). The top five losers were C P S E (0.91%), Auto (0.90%), Infra (0.75%), Metal (0.65%) and Consumption (0.57%).
Of the 50 stocks on the Nifty, 18 ended in the green. The top five gainers were Cipla (3.40%), Sun Pharma (2.39%), Wipro (2.17%), Dr Reddy (1.93%) and Kotak Bank (1.84%). The top five losers were Ambuja Cements (4.26%), Asian Paints (2.90%), Bhel (2.46%), Gail (2.12%) and H C L Technologies (2.00%).
Of the 1,544 companies on the NSE 740 closed in the green, 736 closed in the red while 68 closed flat.
Wipro was in the news as the company is planning a wide-ranging restructuring to help employees shore up expertise in state-of-the art skills, a move that underscores the need to adapt to the fast-changing role of information technology in enterprises. The restructuring and training will involve enhancing or acquiring proficiency in emerging technology areas such as data analytics and cloud computing. Wipro was among the top three gainers in Sensex 30 stocks.
UPL, formerly known as United Phosphorus, came out with a positive March quarter result which pulled it top of ‘A’ group on the BSE. The company has posted a net profit of Rs33.93 crore for the quarter ended 31 March 2014 as compared to net loss of Rs48.42 crore for the quarter ended March 2013. Total Income has increased from Rs919.97 crore for the quarter ended 31 March 2013 to Rs1,194.35 crore for the quarter ended March 2014.
In spite of registering growth in its March quarter result, Ambuja Cements came among the top two losers in ‘A’ group on the BSE.
US indices closed Friday in the negative. Except for Taiwan Weighted (0.41%) all the other Asian indices closed in the negative. Taiwan Weighted (1.62%) was the top loser.
Profits earned by China's industrial companies rose 10.7% in March to 513.2 billion yuan ($159.9 million) from a year earlier, faster than the 9.4% pace in the January-February period, the government said on Sunday.
European indices were trading in the green. US Futures too were trading higher.
Mukesh Ambani-led RIL has served legal notice to Moneylife for allegedly lowering the prestige of Reliance Industries among the conglomerate's friends and well-wishers
Mukesh Ambani-led Reliance Industries Ltd (RIL) has served a legal notice on Debashis Basu, editor and publisher of Moneylife, Moneywise Media Pvt Ltd and Sucheta Dalal, managing editor of Moneylife, for publishing articles "Congress gift to Reliance: RIL sole beneficiary of anti-dumping duty on PTA" () and "Ambani ki dukaan?"
The notice, sent by legal services firm Khaitan & Co also accuse Moneylife of "lowering the prestige of RIL among the conglomerate's friends and well-wishers".
The notice, while referring Ms Dalal, the managing editor of Moneylife as 'reporter', accuses her of "validating highly objectionable parts from the book "Gas Wars - Crony Capitalism and the Ambanis" in her article 'Ambani ki dukaan?'. Interestingly, the notice referes to the book as 'Pamphlet' at all places, including notices sent to the writers and publishers of the book.
"...you have entered into a deliberate attempt to slander our client's name and reputation by publicizing a highly-objectionable Pamphlet titled "Gas Wars - Crony Capitalism and the Ambani's dukan" by one Paranjoy Guha Thakurta alongwith Subir Ghosh and Jyotirmoy Chaudhuri written, published and distributed with the explicit purpose of making slanderous and baseless allegations against our client (Pamphlet) by validating its highly-objectionable parts in your piece 'Ambani ki dukaan?' on 14 April 2014 at 4.01pm and repeated the injury to our client in the 1 May 2014 edition of Moneylife on pages 16 and 17. In this article you have mixed the wholly unrelated issue of PTA described in para 1-15 of this legal notice with the machinations and the slander inherent in the said Pamphlet. Our clients reserve the right to include for colluding with the said authors of the Pamphlet for the same as the distributor of their canards," the notice from Khaitan & Co says.
Last week, the same lawyer firm issued notices to the authors and distributors of the book "Gas Wars - Crony Capitalism and the Ambanis". The notices also accuse e-distributors of the book, Authors Upfront and Feel Books Pvt Ltd as well as Flipkart and Amazon of being party to a "common conspiracy" to "ensure the defamation of our clients for personal gains". Also included among those served notice is Deepshikha Shankar, event manager for the Foundation of Media Professionals, who had in her personal capacity forwarded the e-invite for the book release function to several people, says a report from Times of India.
Over the past two years, Reliance has been the target of attacks by Aam Aadmi Party (AAP) leaders Arvind Kejriwal and Prashant Bhushan, but they have never been served any legal notice.
In fact, TV news channels, owned by the RIL group itself broadcast the press conferences of Kejriwal and Bhushan LIVE several times, in which the latter have made serious allegations about Reliance. “I find it quite perplexing. If you felt that you have been defamed by what Prashant Bhushan and I said, then we are the real culprits and, if you had to send a defamation notice, it should have been to us. The TV channels merely broadcast what we said,” Kejriwal was quoted as saying in a English translation of the letter posted on the AAP website. Its not clear whether large media groups like TV18, in which RIL has substantial interest, have also received any such notice, since their TV channels had also carried the press conferences of Kejriwal.
Earlier in February this year, Kejriwal, while speaking at a rally, repeatedly cited two bank account numbers claiming that they belonged to Ambani brothers, Mukesh and Anil. This was done as part of challenging Bharatiya Janata Party (BJP)'s prime ministerial candidate Narendra Modi to get black money back from Swiss banks.
However, all the Mukesh Ambani-led conglomerate did was issue a press release refuting the allegations made by Kejriwal, blaming it on mythical ‘vested interests’. "It is being reiterated that neither Reliance Industries nor Mr Mukesh Ambani have or had any illegitimate accounts anywhere in the world. The continued tirade of baseless allegations being made by AAP against us appears to be instigated by vested interests," the company had said. (Reliance refutes Kejriwal's allegations terming it as 'baseless')
Seperately, EAS Sarma, former secretary of the Government of India (GoI), had demanded an independent investigation into the whole gamut of showering one largesse after another on RIL that would unravel the hidden links in this web of improprieties. (Set up SIT to investigate showering of one largesse after another on RIL, says Sarma )
The former secretary had written several letters to the PM and petroleum ministry on the improprieties committed by the United Progressive Alliance (UPA) government in dealing with RIL’s gas project in Krishna Godavari (KG) Basin in Andhra Pradesh.
Last week, Gopalkrishna Gandhi, former governor of West Bengal, called Reliance Industries as 'parallel state', which exercised power brazenly over natural and financial resources, says a report from Times of India. Quoting Mr Gandhi, the report says, "We used to talk of black money as a parallel economy and so it continues to be. But Reliance is a parallel State. I do not know of any country where one single firm exercises such power so brazenly, over the natural resources, financial resources, professional resources and, ultimately, over human resources as the company of the Ambanis". The former governor was speaking at the 15th DP Kohli Memorial Lecture that had over 3,000 officials from the Central Bureau of Investigation (CBI) in the audience.
From what we know, none of these parties have been served legal notice by Reliance Industries.
Hindustan Unilever’s net profit during the March quarter grew to Rs872.13 crore on low input costs and growth in domestic business
Hindustan Unilever Ltd (HUL), the fast moving consumer goods (FMCG), company reported a 11% higher fourth quarter net profit on lower input costs and growth in its domestic consumer business.
For the quarter to end-March, the FMCG company, a unit of Unilever, said its standalone net profit rose 11% to Rs872.13 crore from Rs787.20 crore, while total revenues, including sales, increased 10% to Rs7,094.10 crore from Rs6,465.81 crore, same period last year.
“Against the backdrop of a challenging environment, we have delivered another year of competitive and profitable growth. We stepped up investment behind our brands and innovations, whilst driving cost savings and operational efficiencies with even greater rigor. Looking ahead, we are confident that our strategy is on track to deliver sustainable long term growth and margin improvement,” Harish Manwani, chairman of HUL said in a statement.
The company said during the quarter, its domestic consumer business grew at 9% with 3% underlying volume growth. “The operating context during the quarter remained challenging with slowing market growth and high competitive intensity. Firm input costs were managed through a mix of judicious pricing and cost savings. Brand investments were sustained at competitive levels with higher advertising spend being offset by lower promotional activities,” HUL added.
Soaps and detergents segment
Skin Cleansing delivered double digit growth, aided by a step up in price growth as judicious pricing actions were taken to manage input cost inflation. Growth was broad based across brands with the liquids portfolio seeing accelerated growth.
In Laundry, growth was led by the premium segment with Surf maintaining its double digit growth momentum and Rin delivering good growth on the bars portfolio. Wheel growth stepped up on the back of its re-launch in the last quarter. Comfort Fabric Conditioners continue to lead market development with sustained high growth. Vim led the performance in Household Care.
Skin Care grew well in a soft market. The re-launch of Fair & Lovely, with the new ‘Best Ever Formula’ and supported by a focused activation plan, is yielding positive results. Ponds had a good quarter at the premium end while Lakme and Dove sustained their robust performance. The Facial Cleansing portfolio registered broad based growth driven by innovations launched in previous quarters.
Hair Care sustained volume led double digit growth with Dove delivering another strong performance and Clinic Plus doing well. TRESemmé, which saw the addition of a new Split Remedy variant, continued to make very good progress.
In Oral Care, significant investments were made to sustain our competitiveness in the category. While Close Up grew in the quarter, Pepsodent was impacted by the high promotional intensity in the market. Actions are underway to step up performance.
Colour Cosmetics maintained its strong innovation led growth momentum across both Lakme and Elle 18. Lakme continues to strengthen its position in premium make up driven by a range of exciting and contemporary offerings.
Tea sustained double digit growth on the back of stepped up volumes. Taj Mahal, Red Label and 3 Roses grew in double digits, driven by a strengthened mix and focused in-market activities. The thrust on leading market development for tea bags saw flavoured and green tea bags more than double sales in the quarter. In Coffee, Bru Gold continued to perform well.
Packaged foods segment
Kissan registered another robust quarter with growth accelerating on both Ketchups and Jams, driven by impactful activation while Knorr growth continued to be led by Instant Soups which more than doubled volumes. Ice Creams saw strong growth arising from the selling in of Magnum which was extended to 4 other cities, and sharper in-market execution on Kwality Walls, ahead of the season.
For the 12 month to end-March, HUL said its net profit increased 1.87% to Rs3,867.49 crore from Rs3,796.67 crore, its total revenues grew 8.56% to Rs28,019.13 crore from Rs25,810.21 crore a year ago period.
HUL has declared a full year final dividend of Rs7.50 per share.
HUL closed Monday flat at Rs580.60 on the BSE, while the 30-share benchmark too ended the day flat at 22,631.
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