Sensex

Friday, June 27, 2008

DG - The Front Page: Grasim (Challenging times), Tata Steel (Corus numbers), Accenture (Bullish commentary), Events Calendar

Grasim (Challenging times, MP): We expect VSF prices to soften as supply tightness eases with global production capacity expanding by a third over 2009 and 2010. In the cement business (~80% of FY09ii revenue), the industry’s aggressive capacity expansions in the northern region would make it difficult for Grasim to increase volumes much faster than industry growth. We cut our earnings estimate for FY09 by 8% and for FY10 by 11%. Grasim’s current price translates to US$102/tonne of its FY10ii cement capacity, which is at a discount to current replacement cost of US$140/tonne. However, there are no near-term triggers; maintain MP, target price of Rs1,982 (down from Rs2,200).

 

Tata Steel (Corus numbers slightly below expectation, BUY): Tata Steel’s recurring consolidated profit rose 21% QoQ to Rs15.6bn in 4QFY08. EBIDTA for the quarter stood at Rs44.2bn, up 12.2% QoQ, but marginally lower than our estimate, as income from subsidiaries fell short of our expectation. In FY09, we expect Tata Steel’s domestic operations to benefit from strong volume growth (20% YoY) combined with higher prices and relatively small cost increases (thanks to backward integration). The impact of higher raw-material cost at Corus will be mitigated by price increases, lower interest cost and potential efficiency gains of US$600m. Benefits from recent investments in coking coal and iron ore mines will be realised in the medium term, and would significantly improve Corus’s cost structure. Buy.

 

Accenture (Bullish commentary; Inline results): Accenture’s 3QFY08 result was mixed: it beat its revenue guidance by 1%, on the back of currency uplift. Margin improvement was substantial (EBIT improved by 276bps QoQ). On the flip side, it maintained target guidance for new bookings despite the guidance-beating results.

 

Thanks & Regards,

 

IIFL – Institutional Equities

 

Mumbai

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DG - FW: Sharekhan Post-Market Report dated June 27, 2008

 

 

From: The Sharekhan Research Team [mailto:marketwatch@research.sharekhan.com]
Sent: 27 June 2008 16:34
To: The Sharekhan Research Team
Subject: Sharekhan Post-Market Report dated June 27, 2008

 

 Sharekhan's daily newsletter

Visit us at www.sharekhan.com

 

June 27, 2008

 

Index Performance

Index

Sensex

Nifty

Open

14,127.76

4,315.30

High

14,127.76

4,315.30

Low

13,760.24

4,119.20

Today's Cls

13,802.22

4,136.65

Prev Cls

14,421.82

4,315.85

Change

-619.60

-179.20

% Change

-4.30

-4.15

 

Market Indicators

Top Movers (Group A)

Company

Price 
(Rs)

%
chg

Gainers

Container Corporation

794.00

2.43

Asian Paints

1,197.30

1.47

GSK Pharma

1,126.20

1.47

Cairn India

275.20

1.47

Hindustan Zinc

532.00

1.30

Losers

Hindustan Construction

84.05

-13.35

Phoenix Mills

163.70

-13.11

NALCO

332.80

-9.98

Sintex Industries

325.35

-9.09

Triveni Engineering

70.05

-9.03

Market Statistics

-

BSE

NSE

Advances

601

201

Declines

2,051

1,001

Unchanged

54

19

Volume(Nos)

33.26cr

52.74cr

 Market Commentary 

Another brutal day on Dalal Street

The Sensex ended the day with losses of 620 points after crashing to a low of 13,760 during intra-day trades.

The market crashed by 4.30%, in tune with other major global indices, as concerns of hike in crude oil and inflation played on investor sentiment.   

 

After gaining over 200 points in yesterday's trades, the Sensex resumed 294 points lower at 14,1428 and tanked another 368 points to touch the day's low of 13,760 on relentless selling in Bankex, Auto, Power, and overall stocks. The Sensex managed to recover 42 points in late trades, but still ended with losses of 620 points at 13,802. The Nifty shed 4.15% or 179 points to close at 4,137.

The market breadth was extremely negative. Of the 2,706 stocks traded on the BSE, 2,051 stocks declined, 601 stocks advanced and 54 stocks ended unchanged. All the sectoral indices were battered. Among the major losers, the BSE Bankex index lost 5.34%, the BSE Auto index dropped 5.26%, the BSE Power shed 4.87%, the BSE Metal index declined by 4.53% and the BSE Realty index fell 4.45%.

All the Sensex stocks ended in the red. Among the major losers Tata Motors plummeted 8.24% at Rs445.05, HDFC tanked 8.15% at Rs2,028.15, Wipro dropped 7.78% at Rs436.60, Reliance Infrastructure slumped 7.72% at Rs876, Mahindra& Mahindra crumbled by 7.61% at Rs503, Ambuja Cement dropped 7.14% at Rs80 and Jaiprakash Associates shed 7.01% at Rs141.55. ICICI Bank, DLF, SBI, Maruti Suzuki India, ONGC, Grasim Industries, Reliance Communications, Satyam Computer Services, Infosys, Hindalco and Tata Steel shed over 6-4% each.

Over 2.28 crore Bafna Pharma shares changed hands on the BSE followed by Reliance Petroleum (1.63 crore shares), Chambal Fertilisers (1.16 crore shares), Niraj Cement (1.09 crore shares) and Reliance Natural Resources (1.07 crore shares).

European Indices at 16:15 IST on 27-06-2008

Index

Level

Change (pts)

Change (%)

FTSE 100 Index

5526.70

8.50

0.15

CAC 40 Index

4393.99

-32.20

-0.73

DAX Index

-6414.62

-44.98

-0.70

Asian Indices at close on 27-06-2008

Index

Level

Change (pts)

Change (%)

Nikkei 225

13544.36

-277.96

-2.01

Hang Seng Index

22042.35

-413.32

-1.84

Kospi Index

1684.45

-33.21

-1.93

Straits Times Index

2955.91

-25.04

-0.84

Jakarta Composite Index

2332.12

-18.77

-0.80

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