Share prices range-bound; Nifty will target 5,900 before stalling: Wednesday Closing Report

The market took support around the level suggested yesterday (5,770 on the Nifty) and rebounded on higher volumes. Expect a couple of days of rally

Pinning its hopes on the government's forecast of a normal monsoon this year and taking a cue from early gains in the Asian markets, the Indian bourses, too, opened higher. The Sensex added 122 points to its previous close, to resume trade at 19,274, and the Nifty gained 45 points to open at 5,786. Banking, IT, capital goods and metals sectors helped the indices notch early gains.

The indices were range-bound in the morning session, but profit-booking led the indices to the day's lows at around 1.10pm. At their intra-day lows, the Sensex was at 19,171 and the Nifty stood at 5,760. But taking support from positive earnings reports announced by corporates during the day, and inflows from institutional investors, the market was on a higher trajectory and closed near the day's high.

At the intra-day high, the Sensex was up 363 points at 19,485 and the Nifty gained 116 points at 5,857. The market closed marginally below these levels, the Sensex settling at 19,471 with a gain of 349 points, and the Nifty closing 111 points up at 5,852, suggesting the gains could continue for a day or two. The advance-decline ratio on the National Stock Exchange was 1027:377.

Though the broader indices also closed positive, they underperformed the Sensex. The BSE Mid-cap index gained 1.18% and the BSE Small-cap index advanced 1.29%.

BSE Auto (up 2.72%), BSE IT (up 2.39%), BSE Metal (up 2.32%), BSE Consumer Durables (up 1.99%) and BSE TECk (up 1.95%) were the top sectoral gainers. There were no losers today.

Mahindra & Mahindra (up 5.05%), TCS (up 4.63%), Hindalco Industries (up 4.16%), Tata Motors (up 3.99%) and Jaiprakash Associates (up 3.92%) were the top performers on the Sensex. On the other hand, Reliance Communications (down 1.99%), Hero Honda (down 1.87%) and Larsen & Toubro (down 0.04%) ended losers.

Stepping up its probe into the dealings of suspected money launderer Hassan Ali Khan, the Enforcement Directorate (ED) has approached the ministry of home affairs to find out if he has any links with terror outfits. In a letter to the home ministry, the ED has conveyed that it was absolutely necessary to look into various aspects of the 53-year-old Pune-based stud farm owner's dealings and whether he had any links with any terrorist outfit, whether within the country or abroad.

Markets in Asia ended in the green on indications that despite the downgrade in US credit outlook, the economic recovery is still on track. The markets also factored in the drop in Japanese exports in March following the devastating earthquake and tsunami. Exports fell 2.2% in March, from a year earlier, more than the 1.5% analysts expected. This is the first decline in 16 months.

The Shanghai Composite gained 0.29%, the Hang Seng surged 1.60%, the Jakarta Composite jumped 1.66%, the KLSE Composite climbed 0.62%, the Nikkei 225 advanced 1.76%, the Straits Times rose 1.29%, the Seoul Composite jumped 2.23% and the Taiwan Weighted was up 2.02%.

Back home, institutional investors-both foreign and domestic-were net buyers in the equities segment on Tuesday. Foreign institutional investors bought stocks worth Rs1,693.19 crore and domestic institutional investors pumped in Rs208.33 crore.

Wind energy major Suzlon (up 5.42%) announced that the company has bagged an order from Gujarat State Fertilizers & Chemicals (GSFC) to set up, operate and maintain wind energy projects totalling to 50.4 MW in Gujarat.

The projects, utilising 24 units of Suzlon's S88-2.1MW wind turbine, will be set up in wind farms operated by Suzlon in Rajkot and Surendranagar districts of the state. This is GSFC's fifth order to Suzlon and is scheduled for completion and commissioning by September 2011.

Areva T&D India (up 1.26%) has bagged two electrical balance of plant (eBOP) contracts from Essar Projects (India) for its upcoming power projects at Tori in Jharkhand and Paradip in Orissa. The combined value of both contracts is about Rs290 crore and the scope will include supply and installation of electrical balance of plant solutions for two 600MW thermal power plants at Tori and four 30MW thermal power units at Paradip.

Private sector lender Yes Bank (up 2.18%) plans to raise up to $500 million (about Rs2,000 crore) during the current fiscal to fund business growth. The board has approved to raise funds by way of issuance of equity capital of up to $500 million in one or more tranches, Yes Bank said today.


IDBI Bank plans aggressive retail business growth this year, says chairman

Net profit in fourth quarter grows 62% to Rs516 crore on lower bad loans provisioning and higher interest income; RM Malla, chairman and managing director, sets 40% growth target for retail deposits

IDBI Bank will continue to increase the corporate loan business, but focus more on the retail segment in 2011-12. Currently, the bank's corporate-to-retail loan ratio stands at 70:30.

"We have engaged with almost top 500 companies in India. We will continue to expand our corporate loan business, but this year (FY2011-12) we will aggressively focus on retail," RM Malla, chairman and managing director, IDBI, said on Tuesday.

Savings and current accounts contribute more than 25% to the bank's funds. "We are targeting around 40% growth in retail deposits," Mr Malla told a news conference called to announce the results.

The bank announced a 62% growth in net profit to Rs516 crore in the quarter ended March 2011 from Rs318 crore in the previous corresponding quarter, mainly due to lower provisioning for bad debts and a rise in interest income. Net profit for the full year 2010-11 grew by 60% to Rs1,650 crore, as against Rs1,031 crore in 2009-10.
IDBI's net interest income in the fourth quarter increased by 45% to Rs1109 crore as against Rs 762 crore in the corresponding quarter of the previous year.  Total income of the bank for the quarter rose to Rs 5,701 crore from Rs 4,628 crore in the same period last year.

IDBI's deposits increased to Rs1,80,486 crore  in the fourth quarter to March 2011 from Rs1,67,667 crore in the corresponding period a year ago. Advances stood at Rs1,57,098 crore, compared to Rs1,38,202 crore. The bank expects a loan growth of 15% to 18% in the current financial year.

IDBI plans to raise $1 billion in this fiscal through its umbrella medium term note (MTN) programme. The bank had mopped up $350 million through this programme last year.

The state-owned bank also plans to raise $250 million via a bond issue in which global banks and financial institutions will invest. "We will raise $250 million in a bond issue and Asian Development Bank will be a guarantor," Mr Malla said.
The bank's step to waive charges on current and savings account (CASAs) transactions led to an increase in the proportion of CASA in total deposits. "With this step, the share of CASA in the total deposit increased to 20% from 15 %," the chairman said.
The bank opened 284 branches in FY11 and it intends to increase the number of branches this year too. "We have got licences to open 500 branches. We opened 284 branches in FY11. We plan to open more branches," said Pothukuchi Sitaram, chief financial officer, IDBI.


Bajaj launches Discover 125cc in Tamil Nadu

Bajaj Auto has launched its new Discover 125cc motorcycle in the Tamil Nadu  market and expects the sales volume of its Discover brand to grow to 1.5 lakh per month this fiscal

Bajaj Auto Ltd has launched its new Discover 125cc motorcycle in the Tamil Nadu market and expects the sales volume of its Discover brand to grow to 1.5 lakh per month this fiscal.

"With the launch of Discover 125cc, we expect the sales volume of our Discover brand to rise to 1.5 lakh per month for 2011-12 fiscal from the present 1.2 lakh," Bajaj auto zonal manager-motorcycle business Guruprasad said.

He added that out of the 30,000 monthly addition of vehicles next fiscal, at least 20,000 would be Discover 125cc, which is powered with tough engine and optimum combination of mileage and power at a price of Rs45,392 (ex-showroom).

The discover 125cc is the third motorcycle to be launched by the company after the successful Discover 100cc and Discover 150 models.

Claiming that the company is the second largest two-wheeler brand in the world, Guruprasad said over 40 lakh motorcycles of the Discover brand, launched in 2008-09, were on the road across the country.

The company has a market share of 27% in the country and is witnessing a 2.6% growth year-or-year nationally, while in Tamil Nadu it is registering 37% growth, he said.

Launched in Kerala and Karnataka a couple of days ago, the vehicle would soon be launched in Maharashtra and Gujarat, and the rest of the country in a phased manner.

On Wednesday, Bajaj Auto ended 1.77% up at Rs1,474.05 on the Bombay Stock Exchange, while the benchmark Sensex gained 1.83% to 19,470.98.


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