News with Tags "Stock Recommendations"

MUMBAI: Overseas investors have poured in a staggering Rs 8,800 crore (about $1.6 billion) in Indian equities in the first two weeks of this year as stock market participants cheered the US Senate's approving a bill to avoid the so-called 'fiscal cliff'.

From January 1-11, Foreign Institutional Investors (FIIs) were gross buyers of shares worth Rs 25,458 crore, while they sold equities amounting to Rs 16,645 crore -- a net inflow of Rs 8,813 crore ($1.6 billion), according to Sebi data.

In 2012, FIIs had made net investment of Rs 1.28 lakh crore ($24.4 billion) in Indian equities, making it the second best year for the market after record inflow of Rs 1.33 lakh crore ($29 billion) in 2010.

Market analysts said overseas investors have stepped up their buying activities after the US Senate passed a 'fiscal cliff' bill that delays the automatic spending cuts by two months and raises taxes on individuals earning more than $400,000 a year and households making more than $450,000.

"The huge inflows by FIIs could be attributed to approval of fiscal-cliff deal. Moreover, reform hopes in India would further attract foreign investors," a stock broker said.

There were worries that if US law makers are unable to avert the fiscal cliff issue, it could have pushed the US economy back into recession and caused more sluggishness in the growth pace of the global economy, he added.

However, FIIs have pulled out Rs 261 crore ($46 million) in the debt market in 2013. This takes the total investment tally into the stock and bond to Rs 8,552 crore.

The strong inflow by FIIs have pushed up the BSE 30-scrip index, Sensex, by 237 points or 1.21 per cent so far the year to settle at 19,663.64 points on Friday.

As on January 11, the number of registered FIIs in the country stood at 1,760 and total number of sub-accounts were 6,358.

MUMBAI: Buoyed by a smart uptick in the value of Infosys stock, the combined market capitalisation (m-cap) of top four Indian companies rose by Rs 29,268 crore on the BSE last week.

While TCS, ONGC, SBI and Infosys saw rise in their m-cap, RIL, CIL, ITC, HDFC Bank, ICICI Bank and NTPC suffered a cumulative erosion of Rs 24,546 crore.

Infosys m-cap soared Rs 20,920 crore at Rs 1,55,767 crore last week following a sharp rally in its stock price that zoomed nearly 17 per cent on Friday after stronger-than- expected quarterly profit, and upward revision in the 2012-13 sales forecast.

Infosys net profit at Rs 2,369 crore in the October- December quarter of the current fiscal was marginally lower than Rs 2,372 crore logged in the same period a year ago.

The company has raised its sales forecast for FY13 to be "at least USD 7.45 billion" (from USD 7.34 billion stated earlier), including USD 104 million in additional revenue from acquired Swiss firm Lodestone. This is about 6.5 per cent growth over last year.

"Infosys surprised the street with better-than-expected results for Q3, FY'13 and also raised its full year guidance, contrary to expectations of reducing it. Revision of guidance indicates that the management is confident about growth prospects in the short to medium-term versus last few quarters," Angel Broking said in a report.

Besides, ONGC added Rs 6,203 crore to its m-cap which was at Rs 2,49,820 crore, while TCS's value moved up by Rs 1,732 crore to Rs 2,55,681 crore. The m-cap of SBI rose by Rs 413 crore to Rs 1,67,154 crore.

Meanwhile, RIL value dipped Rs 6,957 crore at Rs 2,71,541 crore, while ITC shed Rs 6,808 crore at Rs 2,15,470 crore.

NTPC's m-cap slipped Rs 5,071 crore at Rs 1,25,702 crore, value of HDFC Bank tanked Rs 2,330 crore at Rs 1,58,320 crore, while ICICI Bank lost Rs 1,927 crore at Rs 1,34,397 crore.

CIL's value plunged Rs 1,453 crore at Rs 2,27,736 crore. The list of top-10 m-cap companies on the BSE as of last week was: RIL, followed by TCS, ONGC, CIL, ITC, SBI, HDFC Bank, Infosys, ICICI Bank and NTPC.

NEW DELHI: Drug major Cipla today said state-run Life Insurance Corporation has sold 2.12 per cent stake in it through open market transactions for Rs 665.39 crore.

The insurer has reduced its stake to 6.21 per cent through the open market sales, it added.

"LIC has sold 1.7 crore shares representing 2.12 per cent stake of the company between August 21, 2012 and January 7, 2013 via open market," Cipla said in a filing to the BSE.

Following the transactions, LIC's total shareholding in the company has come down to 6.21 per cent from 8.34 per cent.

Meanwhile, Foreign Institutional Investors (FIIs) have raised their holding in Cipla to 20.79 per cent in September 2012 from 18.08 per cent at the end of June 2012.

NEW DELHI: Drug major Cipla today said state-run Life Insurance Corporation has sold 2.12 per cent stake in it through open market transactions for Rs 665.39 crore.

The insurer has reduced its stake to 6.21 per cent through the open market sales, it added.

"LIC has sold 1.7 crore shares representing 2.12 per cent stake of the company between August 21, 2012 and January 7, 2013 via open market," Cipla said in a filing to the BSE.

Following the transactions, LIC's total shareholding in the company has come down to 6.21 per cent from 8.34 per cent.

Meanwhile, Foreign Institutional Investors (FIIs) have raised their holding in Cipla to 20.79 per cent in September 2012 from 18.08 per cent at the end of June 2012.

The week ahead will keep India Inc and Dalal Street on their toes. Bellwethers like RIL, TCS and ITC will declare their results, which will set the next direction for markets. Investors and analysts will closely watch the management commentary that would accompany with the result which could cause revision in future earnings forecast of the company for the current fiscal and the year ahead.

TCS will announce Q3 results on Monday, January 14th. Analysts expect 21 percent rise in net profit and 20 percent jump in sales. The busiest day of the week will be Friday, January 18th when RIL, ITC, HDFC Bank and Wipro all declare their quarterly earnings. For Reliance Industries, analysts expect 17 percent growth in profit and 6 percent rise in sales.

"Profit booking in markets will continue next week, Nifty is likely to trade in the range between 5850 to 5050," said AK Prabhakar, Senior VP, Equity Research at Anand Rathi Financial. "Technology stocks are likely to outperform the markets on the back of Infosys results. The next direction for technology stocks will be determined by TCS numbers."

The other set of significant numbers that will be declared next week are Axis Bank results on Tuesday (January 15th), Bajaj Auto's Q3 results on Wednesday (January 16th), Hero MotoCorp and HCL Technologies (both on Thursday).

Analysts say technology is going to be the theme for next week after Infosys surged 17 percent on Friday, January 11th when it raised its revenue forecast and posted stronger-than-expected results. Traders are building high hopes on technology counters.

"No big negative surprises are expected from earnings of blue chip companies and markets are unlikely to see any significant correction," said Pankaj Pandey, Head of Research at ICICI Securities. "There might be reshuffle of funds from FMCG, pharma stocks to technology counters."

Government will release December inflation data on Monday, which would be a key indicator ahead of the central bank's policy review on January 29. Wholesale prices, the main inflation gauge, is expected to have risen an annual 7.40 percent in December.

Traders are also looking for a potential announcement on a widely expected hike in fuel prices after the oil ministry sent a proposal to the cabinet.

SEBI is due to hold its board meeting on January 18, amid expectations that it may announce tightening of norms for offer-for-sale transactions.

The Congress is also holding its summit on economic policy and political strategy on Friday. Sonia Gandhi, Rahul Gandhi and Prime Minister Manmohan Singh are likely to attend the meet.

On the global front, China releases its GDP numbers and Goldman, Citi, Intel report their earnings next week in US.

The week ahead will keep India Inc and Dalal Street on their toes. Bellwethers like RIL, TCS and ITC will declare their results, which will set the next direction for markets. Investors and analysts will closely watch the management commentary that would accompany with the result which could cause revision in future earnings forecast of the company for the current fiscal and the year ahead.

TCS will announce Q3 results on Monday, January 14th. Analysts expect 21 percent rise in net profit and 20 percent jump in sales. The busiest day of the week will be Friday, January 18th when RIL, ITC, HDFC Bank and Wipro all declare their quarterly earnings. For Reliance Industries, analysts expect 17 percent growth in profit and 6 percent rise in sales.

"Profit booking in markets will continue next week, Nifty is likely to trade in the range between 5850 to 5050," said AK Prabhakar, Senior VP, Equity Research at Anand Rathi Financial. "Technology stocks are likely to outperform the markets on the back of Infosys results. The next direction for technology stocks will be determined by TCS numbers."

The other set of significant numbers that will be declared next week are Axis Bank results on Tuesday (January 15th), Bajaj Auto's Q3 results on Wednesday (January 16th), Hero MotoCorp and HCL Technologies (both on Thursday).

Analysts say technology is going to be the theme for next week after Infosys surged 17 percent on Friday, January 11th when it raised its revenue forecast and posted stronger-than-expected results. Traders are building high hopes on technology counters.

"No big negative surprises are expected from earnings of blue chip companies and markets are unlikely to see any significant correction," said Pankaj Pandey, Head of Research at ICICI Securities. "There might be reshuffle of funds from FMCG, pharma stocks to technology counters."

Government will release December inflation data on Monday, which would be a key indicator ahead of the central bank's policy review on January 29. Wholesale prices, the main inflation gauge, is expected to have risen an annual 7.40 percent in December.

Traders are also looking for a potential announcement on a widely expected hike in fuel prices after the oil ministry sent a proposal to the cabinet.

SEBI is due to hold its board meeting on January 18, amid expectations that it may announce tightening of norms for offer-for-sale transactions.

The Congress is also holding its summit on economic policy and political strategy on Friday. Sonia Gandhi, Rahul Gandhi and Prime Minister Manmohan Singh are likely to attend the meet.

On the global front, China releases its GDP numbers and Goldman, Citi, Intel report their earnings next week in US.

MUMBAI: R Raheja Properties Pvt Ltd, a part of promoter group of textile company Futura Polysters, has sold 1.12 crore shares totaling 20.49% stake in the company. The promoter has sold the stake in an off-market transaction on January 7, Futura Polysters said in a regulatory filing on Bombay Stock Exchange.

The notice on BSE did not detail whether the sale is in the form of inter-se transfer between promoters of the company. Following the stake sale, R Raheja Properties now hold 24.50 lakh shares or 4.46% stake in Futura Polysters.

On Friday, shares of Futura Polysters closed at Rs 4.26 on Bombay Stock Exchange, up 4.9% from Thursday's close. The stock is part of BSE's T group shares and has face value of Rs 10 each. .

MUMBAI: A slew of factors-—strong quarterly results which beat expectations of analysts, revenue guidance that was ahead of what the market players were looking for and short covering by speculators—pushed Infosys's stock up 17% at Friday's close.

Riding the strong sentiment on Dalal Street, the stock closed at Rs 2,713, and now broking house analysts too are set to join the party. Over the next few days, several of them are expected to raise their ratings on the stock and also up the target price.

This, however, could come after they are through with a detailed conference call with the Infosys management, a postresults ritual, hinted broking house reports on the IT major.

In Friday's volatile session, the Infosys stock opened about 8% higher after the company said its dollar revenues during the October-December quarter was up 4.2% on a quarterly basis while during the current quarter the same could grow by 2.8%. Through the session the stock picked up gains, touched an intra-day high at Rs 2,720 and closed with a combined volume of nearly 1.4 crore shares, compared to an average daily volumes of about 20 lakh shares.

After the initial spurt, Infosys gained further on the back of short covering by speculators who had sold the stock ahead of its results, expecting muted or even lowerthan-guidance growth in revenues for the quarter.

The day's unexpected spurt in scrip made Infosys shareholders richer by about Rs 22,500 crore, or $4.1 billion, with the Bangalore-based software major's market capitalization now at nearly Rs 1.6 lakh crore. The day's gains in market cap also took Infosys to become the eighth most valuable company in India, up one notch from Thursday and ahead of ICICI Bank.

In comparison to Infosys's 17% gain on the day, in recent past, among the top sensex stocks SBI had rallied 6.1% on October 12, 2011. And among the other large cap stocks, United Spirits had jumped 35% on November 12 last year after the Vijay Mallya-promoted company stuck a deal with global liquor major Diageo for to sell a majority stake to the London-based company.

Analysts sounded upbeat on the company's future performance based on the media conference of Infosys top management. "We believe Infosys's results signal a turn in trajectory of the revenue growth...Although quarter results were driven by a return to a mean in pricing post significant disappointment earlier on in the year, we believe this could reflect some initial success in the company's new, more aggressive strategy," wrote Bhuvnesh Singh and Vaibhav Dhasmana, IT analysts at Barclays Capital.

"Growth in December (and the March guidance) now implies a narrowing of the growth gap versus TCS, which we believe could help the stock," the analysts said.

MUMBAI: Shares of Arshiya International, a logistics and warehousing services provider, have plunged more than 42 per cent over the past three trading sessions after the company sacked around a fifth of its workforce amid brewing financial troubles. The company said it had fired 290 out of its 1,700-people workforce mainly on grounds of performance. Most of these employees work as supervisors, with some senior managers from its 3PL business and sales team.

The Arshiya stock closed at the 10 per cent lower circuit of 70.20 on Friday. The business is running as usual with some interruptions due to protests at Mumbai Free Trade Warehousing Zone concept (FTWZ) due to employee retrenchment, the company management said in a concall on Thursday. But, there has been no delay in the goods movement or lag in delivery timeline despite of some workers on strike at Mumbai FTWZ, it added.

"A delay in commencement of operations at Khurja Distripark and Khurja rail sidings have been a big disappointment as capital infusion of Rs 850 crore is not seeing any revenue generation," Emkay said in a report on Friday.

MUMBAI: Infy's unexpected 17 per cent jump on results day — the highest single-day rise in two decades and the second rise on results day over the last 11 quarters — resulted in windfall gains for derivatives traders who bet the stock could move sharply either ways (up or down).

These traders made a 77 per cent gain in just five days through Friday by buying a call and put option of the same strike price. However, those who sold the options were faced with huge losses as they bet that prices would not move up or down sharply.

The option seller collected premiums from the buyers. The buyers are traders who use complex options strategies to bet on price change intensity prior to an important event, like results.

In Infy's case, they bought both call and put options of the same strike price - the price at which an option can be exercised - expiring in January by paying a premium. This strategy is called long straddle.

They bet the premiums would rise. A call option gives a holder the right but not the obligation to buy an underlier at a strike price by paying a premium at a fraction of the contract value, while a put gives a holder the right to sell it.

However, rather than giving or taking delivery, options on Indian stock markets are cash settled. A buyer of a call makes money when the underlier (stock) rises and a put buyer profits when the underlier falls.

On the Infy derivatives counter, traders, particularly institutions, on Monday bought a call and put option of the 2,400-strike price. In addition, these institutions hedged the delta or ratio of price change in underlier to that of the options price.

Simply put, this means if the underlying Infy stock rises, the institutions add more calls to the straddle and if it falls they add more puts. Everything seemed to be going for the option seller and put buyer's way from Monday till Thursday during which Infy fell 2.2 per cent.

However, on Friday, after its results were declared, the Infy stock opened up 8 per cent before ending the day higher at 17 per cent. While the premium on the 2,400 put ended down by Rs 114 or close to zero, the 2,400 call premium ended up a whopping Rs 320 overnight. Traders who bought the 2,400 call-put paying a combined premium of Rs 180, gained Rs 140 or 77 per cent in 5 days as the call premium rose to Rs 320.

However, these traders could not optimise profits as the 8 per cent gap-up opening did not give them the opportunity of buying more call options.

"Traders, particularly institutions, benefited by initiating a long straddle in at-the-money 2,400 options when the underlier quoted at Rs 2,374 on Monday. The stock fell steadily to Rs 2,322 or a little more than 2 per cent between Monday and Thursday. This gave rise to expectations that Infy would keep its faith with those expecting a fall. However, fortune favoured traders who initiated long straddles as Infy ended up 17 per cent on Friday," said Yogesh Radke, head of quantitative research at Edelweiss Financial Services