Wednesday, 9 June 2010

BOR: Market Outlook: Indian markets will have flat to positive opening today

Market Outlook: Indian markets will have flat to positive opening today on the back of mixed action seen on the global peers. Overall the trend is till intact up but there could be some exhaustion in it’s upmove and the market could stall around 5150-5200 levels. Support for Nifty at 4967-4892

Global Events to watch for today:

  • International Trade
  • Jobless Claims

Global indices Update @ 8:

Dow Jones : 9899 (- 10.73)

NASDAQ : 2158 (- 11.72)

Nikkei 225 : 9469 (+30.50)

Hang seng : 19565 (- 55.86)

SGX CNX Nifty : 5017 (+09.50)

INR / 1 USD : 46.98

Stocks in action for the day : R-Power, PowerGrid, Fortis Healthcare, Voltas, EIL, Orbit Corp, Essar Oil, HDFC Bk…

HDFC Bank to fix new base rate around 6%: Sources: Starting July 1, the banking industry will replace the prime lending rate with a new base rate. The introduction of the new base rate however looks set to see some stiff competition between banks. While most PSU banks are likely to follow leader SBI and go with abase rate around 8%, HDFC Bank may go with a base rate of as low as 6%,

Zain success holds key to Bharti's future growth: Bharti Airtel’s stock has seen a sharp movement in the past two trading sessions that followed the announcement of the closure of its mega acquisition of Zain Africa. After losing as much as 4% on bourses soon after the announcement on Tuesday, the stock dramatically recovered the next day. At the end of the trade on Wednesday, it gained nearly 6% even as the broader market remained more or less flat.

R-Power, Indonesia`s Sugico ink pact to acquire coal mines Anil Ambani-owned Reliance Power has signed a share-sale agreement with Indonesia`s Sugico Group to acquire three coal mines in a transaction that will involve a series of production-linked milestone payments. Reliance Power`s wholly-owned subsidiary, Reliance Coal Resources, will make an upfront payment of Rs 5 billion (USD106 million) for acquiring the mines. The balance payment will be paid in a staggered fashion depending on the mines meeting certain production targets. If all production-linked targets are met, the total value of the deal will be USD 1.6 billion.

Andrew Yule to foray into specialty teas Andrew Yule & Co is making a foray into the designer specialty tea segment to spruce up its margins in the current fiscal. These teas, which can fetch Rs 7,000 - Rs 15,000 per kg in the international market will be sold at high-street departmental stores like Harrods. A team from Harrods is now in Kolkata to hold talks with Andrew Yule for sourcing these exclusive designer teas for their store in London. On Wednesday, the company launched three new teas from its Darjeeling tea estate, Mim-Himalayan Delite (Darjeeling organic green tea), Mim Darjeeling organic tea and Mim Darjeeling specialty designer teas.

PowerGrid may sell 20% stake to raise Rs 80 bn Electricity transmission company PowerGrid Corporation may sell 20% to public that could raise Rs 80 billion, which may be equally split between the government andthe company , said two people familiar with the plans. This share sale will be pursued aggressively, since steelmaker SAIL`s fund-raising plans may be delayed due to compliance issues, they said. The government plans to sell 10% and Power Grid will issue new shares comprising 10% of post-issue capital to raise funds for expansion, which is estimated at Rs 550 billion, they added. The fund-raising target is a calculation based on current market price.

Fortis to raise Rs 27.5 bn via issue of securities The Fortis Healthcare board on Wednesday gave the company the go-ahead to raise Rs 27.5 billion through fresh issue of securities, including shares, and also increased the company`s borrowing limit to Rs 60 billion. The company did not specify the reason for raising fresh funds, but said ``all options to deal with potential investment opportunities have been kept open``. Analysts see this as a possible preparation for a counter bid for garnering more shares in the Singapore-headquartered Parkway Holdings. ``This is an indication for the first step to make a counter offer,`` said Vishal Gandhi, VP Life Sciences & Technology, YES Bank.

Pipavav to build world`s biggest dry dock Eyeing business from domestic and international shipping lines that ply through the busy sea route between Dubai and Colombo, Pipavav Shipyard (PSL) is all set to construct a new dry dock in Gujarat, which is expected to be the world`s biggest dock to undertake repair and maintenance of vessels operating in the region. Roughly the size of seven soccer fields, the dock will be bigger than Hyundai`s in South Korea.

RIL drawing up plans to foray into telecom space The board of Reliance Industries (RIL) is believed to have approved plans to enter the Indian telecommunications sector when the opportunity arises, two persons familiar with the development told ET. India`s largest private sector company is expected to go for only the lucrative corporate bandwidth market, or the business of selling telecom and internet services to companies rather than individuals. It is likely thatthe company could unveil its intent to foray into telecom at its annual general meeting on June 18, the people familiar with its plans said.

Regaliaa Realty lines up Rs 650 mn Chennai-based Regaliaa Realty is planning to invest around Rs 650 million in various hospitality and residential projects. The company, which is currently promoting mid and high-end residential projects, said it would also look at foraying into low-end housing projects.The company has set up 11 services apartments under the brand Homcourt at Nugambakkam here and is planning to add five more in the same location. ``In the next 24 monthsthe company is planning to take total number of service apartments to 100 with an investment of around Rs 150 million,`` said D Sudhakara Reddy, chairman and managing director, Regaliaa Realty.

RINL, NMDC in talks to set up pellet plant Rashtriya Ispat Nigam (RINL), the flagship company of Visakhapatnam Steel Plant (VSP), and NMDC on Wednesday held discussions for setting up a pellet plant through joint venture. The two chairmen and managing directors - PK Bishnoi and Rana Som of VSP and NMDC respectively -took part in the discussions. Transportation of fines in the form of slurry for pellet would reduce dependence on rail apart from reducing the burden on the existing logistics of the Kothavalasa-Kirandol line, VSP said in a press release.

Strides hits big with pfizer deal Strides Arcolab, an Rs 15 billion publicly-held pharma firm based in Bangalore, is reaping the benefits of its outsourcing deal with Pfizer. While the financial terms have not been disclosed, the quantum of the deal is visible from Strides paying in cash for its recent acquisitions. Strides have managed to payout nearly a third of the Rs 8.8 billion which it has to pay for its recent acquisitions. ``This indicates pretty good cash flow from the licensing deal with Pfizer,`` noted an analyst. In March 2010, Strides bought a 50% stake owned by South African generics drug maker Aspen Pharmaceuticals for USD 117 million (around Rs 5.31 billion) and also acquired Aspen`s unit in Brazil for USD 75 million, taking the cost of its acquisition to USD 192 million.

BHEL, Alstom tie-up to jointly bid for Chennai metro State-run BHEL has tied up with French firm Alstom to jointly bid for the Chennai metro project. ``We have signed in-principle agreement with Alstom for the Chennai metro project, but the equity portion is yet to be decided,`` the BHEL Chairman and Managing Director, B.P. Rao, told reporters here on Wednesday.

Parabolic Drugs to raise Rs 2 bn through IPO Parabolic Drugs (PDL), on Wednesday said that it plans to raise up to Rs 2 billion through an Initial Public Offerin g (IPO) that opens for subscription on June 14. The Chandigarh based contract manufacturer of active pharmaceutical ingredients (APIs) and API intermediates, will use the proceeds towards setting up new facilities, capacity expansion of existing ones and repaying debt, a top company official said. ``We plan to raise up to Rs 2 billion from the capital market. A part of the proceeds will go towards financing our capex plans and a part of it will be used to reduce our debt,`` PDL`s Executive Director, Vineet Gupta, told reporters here.

ONGC sees rise in insurance premium for offshore assets Oil and Natural Gas Corporation on Wednesday said it expects insurance premium for offshore assets to rise sharply following an oil leak in the Gulf of Mexico that has been described as the worst in the US history. ``Insurance costs are going to go up exponentially around the world. We anticipate that our insurance premium next year will rise exponentially,`` said R S Sharma, CMD., ONGC.

Sabero's growth prospects appear attractive: The crop protection major, Sabero Organics Gujarat (SOGL), has done exceedingly well on the bourses following its improved financial performance. Its stock has more than doubled in a span of one year, way ahead of the benchmark Sensex performance.

Fortis get shareholders' nod for selling 6.5% stake to GIC: Hospital chain Fortis Healthcare today said its shareholders have approved selling 6.58 per cent stake in the company to Singapore-based private equity firm GIC for Rs 380 crore. The stake sale has been carried through preferential allotment of 2.23 crore equity shares. extra-ordinary general meeting held today approved the allotment of 2.23 crore equity shares of Rs 10 each at a premium of Rs 160 to Lathe Investment Pte Ltd, an affiliated investment vehicle of GIC Special Investment.

Ex-dates: today HDFC Bank : Ex dividend Rs 12/share-ICICI Bank : Ex dividend Rs 12/share-Infotech Enterprise : Ex-Bonus 1:1

Engineers India FPO expected to hit market by July-end, ((Expected to raise Rs 1,100-1,200 crore or 10% dilution)

Lanco group & Edelweiss Capital made a bid in the range of Rs 30-45 crore to acquire Axis Bank's PE firm

Fatpipe IPO extends closing date to June 14 from June 9 and revises price band to Rs 80-85 (versus Rs 82-85)

ACC cement despatches for May at 1.75 million tons versus 1.82 million tons (YoY)

Essar Oil’s holding company Essar Energy included in FTSE 100

Orbit Corp board meet on June 18 to raise Rs 1,000 crore via QIP

Tata Sons increase their stake by 2% in Voltas

ONGC Petro Additions talking to 3-4 foreign players for tie-up ((Lyondell,Ineos,Itochu)): DNA

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