Monday, July 5, 2010

Market Outlook: Indian markets likely to see flat to negative opening

Market Outlook: Indian markets likely to see flat to negative opening as Asia markets are trading mixed; Shanghai Composite down, Nikkei up. Overall outlook still remains negatively biased with economic concerns hovers across. Banks, real estate and automobile shares could lead the stock market lower on Monday, after the Reserve Bank of India (RBI) raised interest rates sooner than expected to combat inflation. The crucial support on the downside for the Nifty is 5220-5145 and resistance at 5300.

Global events to watch:

Þ US Holiday: Independence Day Observed (All Markets Closed)

Global indices Update @ 8:

Dow Jones : 9686 (- 46.05)

NASDAQ : 2091 (- 09.57)

Nikkei 225 : 9238 (+34.30)

Hang seng : 19849 (- 56.26)

SGX CNX Nifty : 5227 (- 16.00)

INR / 1 USD : 46.68

Stocks in action for the day : R Power, RNRL, RCF, Network 18, Power Grid

State-owned oil marketing companies may revise auto fuel prices every fortnight. State-owned oil marketing companies may revise auto fuel prices every fortnight so that domestic retail prices also reflect the frequent drop in international prices. State-owned oil firms such as IndianOil, Bharat Petroleum Corp and Hindustan Petroleum Corp are expected to face a fierce competition for market share from their private counterparts post price deregulation. State-owned oil firms manage over 95% of the 40,000 odd fuel pumps in India. Private oil companies such as Reliance, Essar and Shell are anyway free to change pump prices of auto fuels on a daily basis like in the US

RNRL-Reliance Power ((RNRL CMP: Rs 64, Rel Power: Rs 175 – implies big fall for RNRL stock)) RNRL-Reliance Power boards approved merger -RNRL shareholders to get 1 Reliance Power share for every 4 held -Exchange ratio based on valuation by KPMG -Valuation done on weighted average of DCF, CMP and book value

RIL Exclusive: -RIL may pick up small stake in Reliance Power post merger -Stake likely to be taken as a 'fuel supplier' -Fuel supplier stake is a global practice' -Valuation of merged entity prior to stake sale

RBI -Hikes repo rate by 25 bps to 5.5% from 5.25% -Ups reverse repo rate by 25 bps to 4% from 3.75

Ratan Tata on TCS ((AGM)) -Expects growth from BFSI, retail, govt -Focusing on moving up the value change in FY11 -Margins likely to come under pressure in FY11 -Margin pressure owing to new players in China, Japan, UK

Axis, IDBI Bank led consortium to fund Fortis` Parkway buy A consortium of banks, comprising the country`s third largest private sector lender Axis Bank and state-run IDBI Bank have committed to part finance the USD 2.3 billion counter-offer of Fortis Health care to acquire Singapore``s Parkway Holdings. The consortium, in which Axis Bank andIDBI Bank are among the lead arrangers, could expand its size to 10-12 banks participating lenders from both India and abroad. Other banks in the consortium include country`s largest lender, State Bank and ICICI Bank, a source close to the development told PTI here.

Bharti to invest USD100 mn in Niger by 2012 Bharti Airtel will invest about USD 100 million in Niger to improve the reach and quality of its network in the West African nation by the end of 2012, the mobile phone company said on Friday. Bharti took over mobile operations in 15 African nations when it completed the acquisition of the African assets of Kuwait`s Zain last month. The deal made it the world`s No.5 mobile phone operator by subscribers.

SREI Infra in talks to raise PE fund up to Rs 46 bn SREI Infrastructure has planned to launch a private equity (PE) fund for the infrastructure sector. The company is targeting USD 500 million to USD 1 billion (Rs 23-46 billion) for this fund. According to highly placed sources, it is in discussions with investors, both domestic and foreign PE funds, to raise money to make equity investments in infrastructure projects and companies.

Vardhman to invest Rs 2.3 bn on expanding capacity Leading textile company Vardhman Textiles plans to invest a sum of Rs 2.3 billion on expanding the spinning capacity of its unit in Madhya Pradesh to cater to domestic and export markets. ``We will pump in Rs 2.3 billion on ramping up the production capacity of our unit at Mandideep, in MP, and it is expected to be commissioned within this fiscal,`` a senior official of Vardhman Textiles said. The company has proposed to set up an additional 56,000 spindles at the unit to raise its cotton yarn manufacturing capacity. Currently, the plant in Mandideep has a capacity of 75,000 spindles.

Hindustan Media ropes in 13 anchor investors for IPO Hindustan Media Ventures (HMVL), the Hindi publication arm of the Hindustan Times Group, has roped in a group of 13 anchor investors, including Reliance Capital Trustee Co and State Bank of India, for its Rs 2.7 billion initial public offer opening tomorrow. The company has informed the Bombay Stock Exchange and the National Stock Exchange that about 27.78 lakh equity shares would be allocated to anchor investors at a price of Rs 166 per equity share aggregating Rs 461 million. Reliance Capital Trustee Company will get 30.38% of the said portion (about 8.43 lakh equity shares), while five entities of Birla Sun Life Trustee Company would get 30.37% of the allotted equity shares.

Power Grid

-Board okays follow-on public offer -To dilute 20% via FPO offer

Network 18 & Television Eighteen boards meet on July 7 for restructuring proposal

Federal Bank seeks RBI nod for appointment of Shyam Srinivasan as CEO & MD

AV Birla Group June cement sales up 2.59% at 3.15 mt

Hindustan Media Ventures IPO opens today, issue of Rs 270 crore at a price band of Rs 162-175/sh

SE Investments board meet today on Stock Split

Shipping Corporation : Given physical delivery of its one Crude Oil Carrier m.t. to buyer

Ankit Metal & Power: Board meet on 6 July for Bonus

Gammon Infra: Parvez Keki Umrigar steps down as MD of the company ((no reason provided))

NHPC: designated as executing agency for two hydel plants of total 1842MW

Kinetic likely to re-start 2 wheeler operations in 2013 – FE

M&M, Adani in race to acquire DLF’s 74% stake in insurance JV – Mint

Disclaimer: The information contained in this report is obtained from reliable sources and is directed at institutional investors. In no circumstances should it be considered as an offer to sell/buy or, a solicitation of any offer to, buy or sell the securities or commodities mentioned in this report. No representation is made that the transactions undertaken based on the information contained in this report will be profitable, or that they will not result in losses. Mehta Equities Ltd and/or its representatives will not be liable for the recipients’ investment decision based on this report.

RCF opens 300 acers residential colony for redevelopment – ToI


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