Thursday, January 20, 2011

Market Outlook: Indian markets are expected to open on a negative note

Market Outlook: Indian markets are expected to open on a negative note on the back of depressing momentum on the global counters. Market is still not out of the woods and trying to consolidated before taking fresh moves. Overall market mood is still down but the set-up is such that an up move is a possible with any good newsflow. The support for the Nifty is at 5620 and resistance at 5750.

Results today: Biocon, Indoco Remedies, Info Edge, JSW Energy, KPIT Cummins, Kotak Mahindra Bank, SRF, South Indian Bank, TVS Motor, United Bank of India, YES Bank, Zee News

Global events to watch

Þ Jobless Claims

Þ Existing Home Sales

Global indices Update @ 8:

Dow Jones : 11825 (- 12.64)

NASDAQ : 2725 (- 40.49)

Nikkei 225 : 10438 (-118.9)

Hang seng : 24137 (-281.8)

SGX CNX Nifty : 5658 (-39.00)

INR / 1 USD : 45.38

Stocks in action for the day: LIC Hsg, SAIL, NTPC, Nirma, Indian Bk, ICICI Bank, Tata Steel, Essar...

PM Manmohan Singh reshuffles cabinet -No change in finance, home, defence portfolios -No change in external affairs, environment portfolios Cabinet reshuffle -Jaipal Reddy - Petroleum & Natural Gas -Praful Patel - Heavy industries & public enterprises -Vayalar Ravi - Overseas Indian affairs + Civil Aviation -Shriprakash Jaiswal - Coal -Murli Deora - Corporate affairs -CP Joshi - Road transport & highways -Kamal Nath - Urban Development -RPN Singh - MoS, petroleum, corporate affairs.

Malegam Committee on Microfinance: -More than 2 microfinance cos cannot lend to 1 borrower Recommends setting up of microfinance credit info bureau -Recommends priority status on loans to microlenders -Recommends 24% interest rate cap on loans by microfinance companies -Recommends set up of ombudsman for MFI sector -NBFCs with microfinance operations must be classified as NBFC-MFI -Bank loans to NBFC-MFI to be included in priority sector -Microfinance companies must not be allowed to provide thrift services -RBI must draft customer protection code for MFIs

ICICI gets nod to refinance AI loan for buying A 320s: National Carrier Air India has given a mandate to ICICI Bank to refinance loans to purchase 21 A-320 aircraft. Though a meeting of independent directors with former civil aviation minsiter Praful Patel was scheduled prior to the board meeting to tharsh out contentious issues, it had to be cancelled as prime minister reshuffled the cabinet and Vyalar Ravi was given additional charge of the Civil Aviation ministry. Most of these issues, including the appointment of Air India Express CEO Pawan Arora, were kept in abeyance due to the change of guard. The airline`s board, which met in Mumbai on Wednesday, has also given the go-ahead for delivery financing for B-777-300-ER and one GE-90 spare engine with funding amounting to USD 475 million from the US Exim Bank, said a release.

PowerGrid Corporation bags 16 bn Jharkhand project The country`s largest transmission utility, PowerGrid Corporation of India, has won a Rs 16 billion project to develop the transmission system of Jharkhand. ``The company is expected to sign an agreement with Jharkhand State Electricity Board in the next few weeks,`` a Power-Grid official said. ``The project is expected to come up in the next 18 months.`` PowerGrid would set up 1,000 kms of transmission lines and 10 sub-stations in the state. The project aims to reduce the state`s transmission losses while facilitating power transmission. State-owned PowerGrid has earmarked a capital expenditure of Rs120 billion for the current fiscal and it expects to raise this to Rs180 billion by the next fiscal.

Essar to buy Shell`s UK refinery for USD 350 mn Amidst media reports that Essar group is close to acquiring Royal Dutch Shell`s 9 mn tonne Stanlow refinery in the UK, Essar has successfully closed its USD 500 million convertible bond issue Wednesday. The company confirmed that it is in talks with Shell to acquire its Stanlow refinery. A person familiar with the deal said that process of negotiation is on, but there`s a lot of detail yet to be discussed, and there is room for further negotation. ``The company has been in talks with Shell for over a year now, and the deadline for concluding the deal is set for the end of February.`` They pointed out that the company has raised bonds primarily for financial flexibility, and not specifically for the Shell acquisiton.

Tata Chemicals arm completes acquisition of British Salt Tata Chemicals said its wholly-owned UK arm Brunner Mond has completed the acquisition of Cheshire Salt Holdings (CSHL), parent company of British Salt. Brunner Mond has received the requisite regulatory approvals to complete the acquisition of Cheshire Salt Holdings, Tata Chemicals said in a statement here. ``The acquisition provides an opportunity to secure long-term brine supplies for Brunner Mond operations,`` Tata Chemicals Managing Director R Mukundan said. This acquisition was for 93 million pounds (around Rs 6.5 billion).

Hindustan Zinc aims for higher silver production Vedanta group firm Hindustan Zinc on Wednesday said it is set to become one of the top producers of silver in the world, with an estimated output of 500 tones by March 2011, more than double its production at present. Most of the production would come from its new 1.5 million tonne per annum (MTPA) capacity mill at its Sindesar Khurd mine in Rajasthan which commenced trial production at the end of the quarter ending December, 2010. ``Our Silver segment is undergoing phenomenal growth...We will become one of the world`s top silver producers at 16 million oz (500 tones),`` Chief Operating Officer Hindustan Zinc Akhilesh Joshi told PTI. The new 1.50 MTPA mill at silver-rich mine at Sindesar Khurd has commenced production towards the end of Q3 FY 2011, he said adding, “With our accelerated capacity ramp up, we are poised to exit FY 2012 with Silver production capacity of 500 tones.``

Tata Steel raises about Rs 5.08 bn from anchor investors Tata Steel on Wednesday said it has raised Rs 5,078.2 million through allotment of about 83 lakh shares to a clutch of anchor investors at the upper end of price band of its public offer, which is open for subscription. In a filing to the BSE the company said that ``Committee of the board of directors of the company by a resolution dated January 18, 2011, in consultation with the book running lead managers, has finalised allocation of 8,325,000 equity shares, in aggregate, to anchor investors at a price of Rs 610 per equity share” . According to the filing, the share allotment will be done to 33 anchor investors at Rs 610 per share, the top end of the price band. The follow on offer of 4.8 crore shares, priced at Rs 594-610 per share, opened for subscription on Wednesday and closes on Friday. Tata Steel would raise about Rs 33,858 million to Rs 34.77 billion at the lower and upper band of the price of FPO.

Indian Bank says: -Board has approved FPO; DRHP to be filed mid-May -Post FPO govt holding will come down to 70% from current 80% -Plans to raise Rs 1500 crore from the FPO -Will increase loan book to Rs 20,000 - 25000 crore in 1.5 years -Looking to appoint consultants for insurance foray -Will take a decision by June 2011

Essar Group hits back at Vodafone saying the proposed merger of ETHPL with ISL is for finding a fair market value for its stake (FE)

SAIL, HPL signs MOU to explore the techno-economic viability of a JV in the promising prefabricated steel structure segment (FE)

NTPC will defer the opening of commercial bids in the tender for the supply of supercritical boilers after Ansaldo went to court against NTPC (BL)

Nirma delisting offer closes today, floor price Rs 218/sh

LIC Housing Finance Q3 -Net profit at Rs 213 crore versus Rs 154 crore (YoY) -Income from operations at Rs 1,161 crore

Bajaj Holdings & Investment Q3 -Consolidated net sales at Rs 264.9 crore versus Rs 132.8 crore (YoY) -Consolidated net profit at Rs 501 crore versus Rs 262.2 crore (YoY)

Air India -ICICI Bank to refinance loan for buying 21 Airbus A320s -Maharashtra Govt okays Rs 5,570 crore budget for MMRDA for 2011-12.


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