Sensex, Nifty may move sideways: Wednesday closing report
The market will remain directionless until the election results are clear 

After a relentless rally, market finally seem to be pausing for breath and some serious profit booking from the very start of trading today. Stock indices struggled to stay in the green without any success and the downtrend was visible all through the session.
Sensex opened at 23,898 while the Nifty opened at 7,112. The indices lost strength after hitting a high of 23,965 and 7,142 and edged lower to hit a low of 23,753 and 7,081.
Sensex closed at 23,815 (down 56 points or 0.24%) while Nifty closed flat at 7,109. The NSE recorded a volume of 117.36 crore shares. India VIX rose 1.16% to close at 32.4200.
The top five gainers among the other indices on the NSE were Realty (4.22%), P S U Bank (3.32%), Metal (3.27%), Nifty Midcap 50 (2.56%) and Dividend Opportunities (2.18%) while the top five losers were Energy (0.73%), Pharma (0.43%), Finance (0.33%), I T (0.16%) and Auto (0.08%).
Of the 50 stocks on the Nifty, 30 ended in the green. The top five gainers were Bank of Baroda (9.60%), Jindal Steel (6.51%), Tata Steel (5.95%), DLF (5.45%) and NMDC (5.07%). The top five losers were M & M (3.67%), Dr Reddy (3.48%), HDFC (1.91%), Reliance Industries (1.74%) and HDFC Bank (1.71%).
Of the 1,572 companies trading on the NSE, 958 companies closed in the green, 537 companies closed in the red while 77 companies closed flat.
Tata Steel (5.91%), top gainer among Sensex 30 pack, was in news for its plans to raise $1.24 billion overseas through the sale of bonds. This is part of a mega $7 billion debt refinancing initiative for Tata Steel Europe, formerly known as Corus.
After posting weak consolidated net profit Dr Reddy’s Lab was the top loser in the Sensex 30 stock for the second consecutive session. Bank of America-Merrill Lynch downgraded the stock to "underperform" from "buy," and Morgan Stanley too downgraded it to "equalweight" from "overweight". Dr Reddy’s Lab fell 3.51%.
Indian Bank recently came out with a weak quarterly result and annual result. However it was the top gainer in ‘A’ group on the BSE, rising 11.73%.
Bajaj Finance was the top loser in the ‘A’ group on the BSE, falling 4.35%, despite better results.
 Bank stocks will be in focus in the coming days as a committee appointed by the Reserve Bank of India (RBI) under Dr P J Nayak has reportedly proposed that the government should cut its stakes in state banks to below 50% and establish "fully empowered" bank boards. This has already triggered angry protests from bank unions. The All India Bank Employees Association has issued a strong letter of protest and has threatened country-wide protests, rallies and agitations. The news moved the banking stocks higher. The stocks which came among the top 10 gainers in the ‘A’ group on the BSE were Indian Bank (11.73%), Canara Bank (10.68%), Central Bank of India (10.37%), BOB (9.22%), Union Bank (8.92%), Bank of India (8.21%) and IOB (8.17%).
US indices closed flat on Tuesday. US retail sales increased 0.1% in April following a revised 1.5% jump in March that marked the biggest gain in four years, Commerce Department figures showed in Washington.
Except for Shanghai Composite (0.14%) and Nikkei 225 (0.14%) all the other Asian indices closed in the green. Jakarta Composite (1.43%) was the top gainer.
China's central bank called on the nation's biggest lenders to accelerate the granting of mortgages. The People's Bank of China told 15 banks yesterday to “improve efficiency of service, give timely approval and distribution of mortgages to qualified buyers”. It also urged lenders to give priority to families buying their first homes and strengthen their monitoring of credit risks.
European indices were trading marginally lower as were US Futures.


Bouncers at Geodesic's AGM; are promoters afraid of shareholders?
Geodesic recently held its annual general meeting. Shockingly, the shareholders found a dozen bouncers at the AGM

Geodesic Ltd, the internet software and service provider, which has run up more than Rs1,200 crore of liabilities, defaulted in repaying its foreign currency convertible bond (FCCB) holders and loans to financial institutions, recently on 10th May, held its annual general metting (AGM). One of the shareholders told Moneylife about the presence of the “bouncers at the AGM”. Instead of protecting the interest of the shareholders, did Geodesic hire bouncers to protect its promoters from the shareholders? 
Nitin Rao, a shareholder, who attended the Geodesic AGM shared his expreinece on his blog: He wrote, “the meeting was sparsely attended by shareholders but there were around a dozen bouncers at the AGM. Either the management wanted to intimidate shareholders or they feared the proceedings will get rowdy.”

According to, bouncers (informal term for a type of security guard, employed at bars, nighclubs or concerts) are required where crowd size, clientele or alcohol consumption may make arguments or fights a possibility, or where the threat or presence of criminal gang activity is high.
“The meeting started with the chairman welcoming the shareholder who mentioned that he wanted to be upfront with the shareholders and accounts had to be restated owing to write off of receivables etc. The chairman said, FCCBs couldn’t be repaid as funds are locked into investment accounts and liquidating them now will result in not meeting their liabilites. He gave the status update of all the court cases on Geodesic. He invited the shareholders to join the Board to help the company in its time of crisis,” Rao wrote in his blogpost. 
During the meeting, one of the investors from Nashik, said that, “Chairman had lied to shareholders, accounts had to be restated as all the sales were fake. FCCBs couldn’t be repaid as the money has been siphoned off by promoters and alleged that the promoters are thieves and he had lodged a police complaint against them.”
In reply, Prashant Mulekar of Geodesic, told the investor that all these were lies and the company is being harassed. Mulekar also accused the investor of filing a complaint against the promoters at Nashik. The shareholder had apparently told the police that the promoters had met him at his hotel in Nashik and encouraged him to buy shares in the company, painting a rosy picture., the blogpost mentioned. 
According to Rao, at this point, shareholders sympathetic to the management, got up and alleged that the AGM could not be monopolised. They urged that the resolutions were passed quickly. There was one “investor” in particular who was a clear plant of the management, he said. 
“After this,” Rao said in his blog, “all the resolutions were moved and passed with a show of hands within next 10 minutes. The proceedings took a farcical turn when some 'shareholders' went on to the stage to express her thanks for printing the company annual report on 'glossy paper'! Another wanted to go to the company’s site (property) in Uttarakhand. At the end, the company secretary announced that snacks are ready to be served which invited a headlong rush among the shareholders.”
In a regulatory filing, Geodesic said, it has adopted audited accounts for the FY2011-2013 and FY2012-2013, reports of directors and auditors along with relevant enclosures. It also re-appointed Prashnt Mulekar as director and Borkar & Mazumdar as its statutoruy auditors for next five years. Geodesic also said that it had to recast its accounts for FY 2011-12 which resulted in delayed audit for FY 2012-13.

Moneylife earlier wrote, Crazy about “corporate governance norms”, SEBI is blind about Geodesic. The shareholders of Geodesic have already lost their value as its share prices are around Rs3 and BSE transfered it to 'T' (Trading Settlement) group. While many Shareholders who complained Securities Exchange Board of India (SEBI) about the company, the market regulator, so far, has failed to take any action against Geodesic and its promoters.
Moneylife's email to Geodesic asking, why the company needs to hire services of bouncers at its AGM, remains unanswered till writing this story. We will incorporate their views as soon as we get a reply.
You may like to read more stories on AGM





2 years ago

What should the ordinary minority share holders of Geodesic Ltd. do? What is the position of the appointment of the liquidators ordered by Bombay High court?

Ram Robert Rahim

2 years ago

This is not only company of this kind. There are others also like Shree Ganesh Jewellery (I) Ltd., Gitanjali Gems

Bapoo Malcolm

2 years ago

Be prepared for more of this.

Bapoo M Malcolm

Krishnaraj Venkataraman

2 years ago

This company has been alleged to have not paid salaries for many many months. It has been alleged that part of FCCB funds were routed to an offshore account controlled by the promoters.

The company does not have an independent director and is not in compliance with listing norms and yet BSE does not de-list the firm! The company says it cannot find independent directors; I mean who will want to be one?!

The comments of the Hon'ble Judge in one of the many cases the company is fighting is worth noting.

Sad to say Mr Mulekar (the CFO / Promoter) comes from reputed institutes like IIM Lucknow and VJTI.

Brokerage chief fined in China for criticising largest bank

China’s 'Big Four' banks, which include ICBC, have long been criticised for high charges, poor service and their reluctance to lend to private companies

A Chinese brokerage has fined its chairman two months pay — nearly one million yuan ($161,000) — after he publicly blasted the country’s largest lender Industrial and Commercial Bank of China Ltd (ICBC) over its profits.


The penalty will be levied on Citic Securities’ Wang Dongming, the 21st Century Business Herald newspaper said, basing its estimate on Wang’s 2013 salary of 5.83 million yuan.


China’s 'Big Four' banks, which include ICBC, have long been criticised for high charges, poor service and their reluctance to lend to private companies.


Speaking at a forum in Beijing Saturday, Wang referred to a conversation he had with Yang Kaisheng, former president of the ICBC. “I told ICBC’s governor Yang the other day that if ICBC reports between 200 billion yuan and 300 billion yuan of annual post-tax profits, you’ll be condemned by people across the country. How can a services institution make so much money and to whom did the money go?” he said, according to a transcript posted online.


ICBC in March reported a net profit of 262.97 billion yuan for 2013.


The penalty was revealed in an internal memo by Citic Securities, China’s largest brokerage by market value, which said state media had misinterpreted Wang’s remarks, souring the firm’s relationship with ICBC and hurting the giant bank’s image.


“The disclosure of this incident is a warning that everyone should exercise caution when making comments publicly and do no harm to the interests and feelings of our clients,” Citic Securities said in the memo, which was quoted by state media.


Wang’s remarks allegedly prompted ICBC to drop the brokerage as its underwriter for a planned sale of preferred shares, according to reports.


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