Sensex, Nifty remain range-bound: Friday Closing Report

Nifty has to break the range of 5,230 and 5,340 decisively for further direction. The break may come soon

The market, which was flat for the entire morning session, witnessed a sharp plunge in post-noon trade pulled down by institutional pressures. Snapping a four-day gaining streak, the benchmarks settled off the lows today. Yesterday we had mentioned that the Nifty has to close above the level of 5,380 for the uptrend to gain further momentum. Yesterday's low was to be looked at for support. Today the index broke this level but settled at 5,291 itself. We may now see the benchmark moving in a narrow range of 5,230 and 5,315. The National Stock Exchange (NSE) saw a volume of 57.40 crore shares.

The market witnessed a marginal gap down opening on the back of weak global cues. US markets were down for the second day last night on disappointing economic data and concerns of a French downgrade. The development led the Asian markets lower in morning trade. Back home, the Nifty opened 18 points down at 5,314 and the Sensex was down 44 points at 17,460 at the opening bell.

Profit booking after four days of gains kept the market fluctuating in the negative terrain for the entire morning session. A small bout of buying in noon trade managed to push the indices into the green, enabling them to hit their intraday highs. At this point, the Nifty touched 5,336 and the Sensex 17,520.

The benchmarks couldn't sustain the gains and soon slipped lower again. A sharp slide in post-noon trade on apprehensions of the proposed tax on FII investments saw the market tanking over 1% and tumbling to the day's lows. At the lows, the Nifty fell to 5,245 and the Sensex dropped to 17,231.

A marginal recovery helped the indices pare some of the losses in late trade. However, the market snapped its four-day gaining streak and settled lower today. The Nifty closed 42 points down 42 points at 5,291 and the Sensex lost 130 points to 17,374.

The advance-decline ratio on the NSE was negative at 616:1110.

Among the broader markets, the BSE Mid-cap index declined 0.98% and the BSE Small-cap index fell by 0.47%.

Barring the BSE Fast Moving Consumer Goods (up 0.11%) and BSE Auto (up 0.08%) all other sectoral gauges settled lower. They were led by BSE Capital Goods (down 1.84%); BSE Power (down 1.72%); BSE Realty (down 1.68%); BSE Oil & Gas (down 1.30%) and BSE Bankex (down 1.07%).

The top Sensex stocks were Mahindra & Mahindra (up 2.89%); Wipro (up 0.75%); Tata Steel (up 0.73%), Cipla (up 0.64%) and Coal India (up 0.35%). The main losers were Hindalco Industries (down 2.46%); Tata Power (down 2.28%); ONGC (down 2.24%); BHEL (down 2.05%) and Larsen & Toubro (down 2.02%).

M&M (up 2.69%); ITC (up 0.86%); Wipro (up 0.80%); GAIL India (up 0.78%) and Tata Steel (up 0.73%) emerged as the key gainers on the Nifty. The stocks which dragged the index lower were IDFC (down 3.15%); Jaiprakash Associates (down 2.87%); Jindal Steel (down 2.62%); Hindalco Ind (down 2.50%) and ONGC (down 2.48%).

The Asian pack settled mostly lower on concerns about the global growth on the back of dismal economic data from the US and fresh about the European debt crisis.

The KLSE Composite fell by 0.30%; the Nikkei 225 declined 0.28%; the Straits Times dropped 0.46%; the Seoul Composite slipped 1.26% and the Taiwan Weighted tanked 1.52%. On the other hand, the Shanghai Composite surged 1.19%; the Hang Seng added 0.07% and the Jakarta Composite gained 0.42%. At the time of writing, the key European indices had recovered from their initial losses and were trading in the green and the US stocks futures were in the positive.

Back home, foreign institutional investors were net sellers of equities totalling Rs102.46 crore on Thursday while domestic institutional investors were net buyers of shares amounting to Rs101 crore.

Engineers India (EIL) has signed a memorandum of agreement with Oil India (OIL) for providing consultancy services to the latter for its various upcoming and revamp projects involving construction of surface facilities in oil and gas fields including pipeline projects spread throughout the country. EIL closed at Rs252.15 on the NSE, down 2% from its previous close.

Procter & Gamble Hygiene and Health Care, the world's largest consumer goods company, will build its largest manufacturing plant in the Indian sub-continent in Hyderabad with an investment of Rs345 crore. The plant, to be spread across 170 acres in Mahbubnagar district, will make products across categories such as laundry, personal and baby care. The stock finished 1.14% lower at Rs2,155.10 on the NSE.

Essar Shipping has received an order from New Sino Oil Company to drill five wells in Brunei. Essar Oilfield Services India (EOSIL), a wholly-owned subsidiary of Essar Shipping, will execute the drilling of these wells. The stock gained 1.66% to close at Rs30.70 on the NSE.


Reliance Q4 net profit down 21% to Rs4,236 crore

For the full year, RIL's net profit increased just by 1.2% while total revenues, supported by higher prices, increased 31.4%

India's largest petrochemical company Reliance Industries Ltd (RIL) said its fourth quarter net profit fell 21% to Rs4,236 crore even as its total revenues increased 16.7%. For the quarter to end-March, RIL said its total revenues increased to Rs87,833 crore from Rs75,283 crore, same period a year ago.

In a release, RIL said for the year to end-March its net profit increased 1.2% to Rs20,040 crore from Rs20,286 crore while its total revenues rose 31.4% to Rs3.4 lakh crore from last year.

In a statement, Mukesh Ambani, chairman and managing director, RIL, said, "We have created a strong foundation for future growth and are investing in our core upstream and petrochemical businesses in India. Response to our organised retail business has been very encouraging and we continue to expand our footprint by building more stores across verticals, formats and geographies."

RIL said during the full year that ended on 31 March, its refinery accounted for 36.8%, petrochemicals recorded a 27.7% increase while oil and gas revenues fell 25.2%. Higher prices accounted for 29.2% growth in revenues while higher volumes accounted for the balance 2.2% growth in total revenues. Its raw materials consumption also increased 42.2% to Rs2.74 lakh crore due to higher crude oil prices, the company said.

One more interesting aspect of the company's financials is the "other income" segment. The relevance of "other income" has been substantially increasing with each passing quarter. RIL has huge cash pile of about Rs70,252 crore. This is resulting into huge "other income" on the ample cash balances on the balance sheet of about Rs2,295 crore. Profit before tax of the company is about Rs5,431 crore and "other income" is about Rs2,295 crore. That means, about 42% of profit before tax is coming from the "other income".

"I can't think of any other company of the size of Reliance who gets such a massive proportion of Profit from "other income". One more interesting aspect of the financials is the "other income" segment. The relevance of "other income" has been substantially increasing with each passing quarter. To summarize, Reliance is making more and more money out of money, less and less money out of oil. Probably, it is high time that the company has to clearly pronounce the cash deployment plan regarding how are they going to use Rs70,252 crores. Else, this factor may remain to be huge overhang on the performance of the stock," said Jagannadham Thunuguntla, strategist & head of research at SMC Global Securities Ltd, in a note.

For FY12, RIL declared a dividend of Rs8.5 per share.

Before the results announcement, RIL shares closed Friday 1.4% down at Rs731.4 on the Bombay Stock Exchange, while the benchmark Sensex ended marginally down at 17,373.


Centre refuses to take stand on Ram Setu, asks SC to decide

The case relating to Ram Setu came under judicial scrutiny due to a bunch of petitions filed in the apex court against the ambitious Sethusamudram project, whose execution allegedly was to damage the mythological bridge

New Delhi: The Union government on Friday refused to take any stand on the issue of declaring mythological Ram Setu a national monument and asked the Supreme Court instead to decide it, reports PTI.

Additional Solicitor General (ASG) Haren Raval, appearing before a bench headed by justices HL Dattu and Anil R Dave, submitted that the government after consultations on the issue has decided that it would not take any stand on it.  
He said the government would stand by its earlier affidavit, filed in 2008, in which it had said that the government respects all religions but it was of view that it should not be called upon to respond to the issues of faith, except in recognising their existence.

The bench was hearing a petition filed by Janata Party President Subramanian Swamy seeking the court’s direction to declare Ram Setu a national monument.

The apex court earlier on 29th March had granted two weeks to the Centre to take a stand on the issue.  “If you say you don’t want to file counter affidavit, we can go ahead with the arguments in the case,” the bench had said.

The case relating to Ram Setu came under judicial scrutiny due to a bunch of petitions filed in the apex court against the ambitious Sethusamudram project, whose execution allegedly was to damage the mythological bridge.

Sethusamudram project is aimed at constructing a shorter navigational route around India’s southern tip by breaching the mythological Ram Setu, said to have been built by Lord Rama’s army of monkeys and bears to the demon king Ravana’s kingdom Lanka.

As per the Sethusamudram project, the shipping channel is proposed to be 30 metres wide, 12 metres deep and 167 kms long.

The Centre in its earlier affidavit, cleared by the Cabinet Committee of Political Affairs (CCPA) chaired by Prime Minister Manmohan Singh, had said the government respects all religions but was of view that it “should not be called upon to respond to the issues of faith, except in recognising their existence.”

The amended affidavit was filed after the Centre had withdrawn its two affidavits in which it had questioned the existence of Lord Ram and “Ram Setu”.

Following an outcry led by the Sangh Parivar over the controversial affidavit, the apex court on 14 September 2007 had allowed the Centre re-examine entire materials afresh to review the Rs2,087 crore project.


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