Realty, auto stocks gain
DATE: 12/09/2012
A bout of volatility was witnessed as key benchmark indices regained strength after paring gains to hit fresh intraday low in afternoon trade. Optimism the Indian government will unveil a series of fiscal policy decisions later this week and hopes of further stimulus measures from the world's top central banks boosted sentiment. Market sentiment also boosted by provisional data showing that foreign funds remained net buyers of Indian stocks on Tuesday, 11 September 2012. The BSE Sensex was up 71.13 points or 0.4%, up close to 30 points from the day's low and off about 35 points from the day's high. Index heavyweight Reliance Industries (RIL) was marginally lower. Another index heavyweight and cigarette maker ITC strengthened. The market breadth was positive.
Interest rate realty and auto stocks rose as almost flat growth of industrial output in July 2012 strengthened the case for the central bank to mull cutting policy rates in RBI's policy review on 17 September 2012 in order to help revive growth. L&T rose after company said today that L&T Construction has won new orders valued over Rs 1065 crore across various business segments in September 2012.
Foreign institutional investors (FIIs) bought shares worth a net Rs 423.59 crore on Tuesday, 11 September 2012, as per the provisional figures from the stock exchanges.
At 13:20 IST, the BSE Sensex was up 71.13 points or 0.4% to 17,924.08. The index gained 106.13 points at the day's high of 17,959.08 in early afternoon trade, its highest level since 23 August 2012. The index rose 39.07 points at the day's low of 17,891.02 in afternoon trade.
The S&P CNX Nifty was up 15.75 points or 0.2% to 5,405.75. The index hit a high of 5,418.50, its highest level since 23 August 2012. The Nifty hit a low of 5,395.05 in intraday trade.
The market breadth, indicating the overall health of the market, was positive. On BSE, 1,408 shares rose and 1,217 shares fell. A total of 124 shares were unchanged.
Among the 30-share Sensex pack, 17 gained while the rest declined.
Index heavyweight Reliance Industries (RIL) gained 0.46% to Rs 794, off the day's low of Rs 789.20. RIL has bought back 3.9 crore shares for about of Rs 2793.51 crore till 4 September 2012 under its ongoing share buyback program. RIL has set maximum buyback price of Rs 870 per share. The company has set aside Rs 10440 crore for share buyback. The buyback program opened on 1 February 2012 and closes on 19 January 2013. RIL chairman Mukesh Ambani said at the company's Annual General Meeting in June 2012 that the company's buyback program represents a highly accretive use of cash by the company and it will supplement earnings growth from operations, for higher EPS (earnings per share), in the near future.
RIL on 27 August 2012 said it has scheduled a planned maintenance turnaround of one of the diesel hydrotreater units of the DTA refinery at its Jamnagar, Gujarat complex for a period of approximately two and half weeks starting 28 August 2012. This opportunity will also be utilised to carry out other maintenance and inspection jobs during the shutdown period, RIL said in a statement. During the period the other diesel hydrotreating unit of the DTA refinery along with other units including crude processing levels are planned at normal levels, RIL said.
Index heavyweight and cigarette maker ITC rose 0.62% to Rs 268.55. The stock had scaled a record high of Rs 271.50 on 30 August 2012. ITC had reported strong Q1 June 2012 results. ITC's net profit jumped 20.21% to Rs 1602.14 crore on 15.34% growth in net sales to Rs 6652.21 crore in Q1 June 2012 over Q1 June 2011. Despite series of tax hikes, ITC's performance in cigarettes business remains robust and displays pricing power for the company.
L&T rose 1.57% after company said today that L&T Construction has won new orders valued over Rs 1065 crore across various business segments in September 2012.
Interest rate realty stocks rose as almost flat growth of industrial output in July 2012 strengthened the case for the central bank to mull cutting policy rates in RBI's policy review on 17 September 2012 in order to help revive growth. DLF, HDIL and Unitech rose by between 0.05% to 1.26%. Lower interest rates may help revive demand for properties. Purchases of both residential and commercial property are largely driven by finance.
Interest rate auto stocks mostly gained as almost flat growth of industrial output in July 2012 strengthened the case for the central bank to mull cutting policy rates in RBI's policy review on 17 September 2012 in order to help revive growth. Lower interest rates may help revive demand for vehicles. Purchases of automobiles, including that of cars, utility vehicles and commercial vehicles are substantially driven by financing.
Bajaj Auto rose 0.18%. The company announced last week that its total sales fell 10% to 3.44 lakh units in August 2012 over August 2011. Bajaj Auto said that the company exported 22,300 three-wheelers in August 2012, indicating near normalcy in Sri Lankan and Egyptian markets.
Tata Motors gained 3.45% after the company announced its entry into Indonesia through a wholly-owned subsidiary based in Jakarta, PT Tata Motors Indonesia. A statement from Tata Motors said Indonesia was the largest automobile market in the Association of Southeast Asian Nations (ASEAN) region and the company would enter passenger cars and commercial vehicles segments.
Indonesia is a key market for Tata Motors in commercial vehicles and the company will begin to launch its products in Indonesia in 2013. The statement said that by the time of the launch, PT Tata Motors Indonesia expects to have 10-15 dealers nationwide, offering sales, service and spare parts. Over three years, the company would set up a country-wide network of around 60 full-service dealers about 100 other workshops and about 300 more spare parts retailers, the release said.
“Our portfolio is globally benchmarked. Based on customer feedback, we will progressively introduce relevant passenger and commercial vehicles backed by appropriate distribution and service infrastructure such that we are closest to our customers,'' Ravi Pisharody, Executive Director-Commercial Vehicles, Tata Motors, said in a statement.
Tata Motors is also evaluating options for setting up a manufacturing base in Indonesia to serve Indonesia and the ASEAN region and has planned significant investments for component localisation.
Maruti Suzuki India rose 0.75%. The company said Tuesday, 11 September 2012 that, by an order made on the August 22, 2012, the High Court of Delhi has directed that a separate meeting of the Unsecured Creditors of the company will be held on September 29, 2012, for the purpose of considering, and if thought fit, approving with or without modification(s), the scheme of amalgamation between Suzuki Powertrain India and Maruti Suzuki India and their respective shareholders and creditors.
+POWERED BY: CAPITAL MARKET NEWS
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