Q3 attrition down by 2%; see further decline: Wipro

Wipro surprised markets with the resignations of the joint-CEOs of its information technology business, after reporting profit growth rates which lagged rivals Infosys Technologies and Tata Consultancy Services.

India's third-largest software services exporter said company veteran TK Kurien was taking over as the new chief executive of the unit.

The company's net profit for the third quarter of fiscal year 2011 grew 3.4% on quarter-on-quarter basis. The number stood at Rs 1,319 crore as against Rs 1,276 crore reported last quarter. Its consolidated revenues too went up to Rs 7,829 crore from Rs 7,731 crore and dollar denominated global IT revenues rose 5.6% to USD 1.34 billion (QoQ).

Commenting on the company's performance, the newly appointed CEO of the IT business TK Kurien along with the company’s executive director and chief financial officer Suresh Senapaty, and HR head Pratik Kumar, said they expected growth to return in 2011.

"With the environment for the IT sector looking positive, we are confident of growth despite tepid volumes in the previous quarter," the management said, adding that the attrition rate for the quarter was down by 2%, and it saw further decline there.

On the move to have one CEO for the IT unit, the management said the structure of a single CEO was more appropriate for coming years.

Nifty consolidates; ADAG stocks top gainers

The 50-share NSE Nifty has consistently been volatile in trade today due to two-way move. On one side, heavyweights like Reliance Industries, SBI and ICICI Bank, ahead of their numbers, were helping the markets. BHEL after its strong numbers, NTPC, M&M and Bajaj Auto along with Anil Dhirubhai Ambani Group companies' shares too followed the same trend.

However, selling continued in ONGC, Wipro, Infosys, Bharti Airtel, HDFC and HDFC Bank along with metal, cement, healthcare, realty and FMCG companies' shares.

At this point in time, Arjun Divecha of GMO said they are heavily underweight both India and China in their emerging markets strategy. This is primarily due to high valuations in both countries relative to other emerging markets, he says. "In addition, central banks in both countries appear to be behind the curve and they will have to act strongly to bring inflation down."

The Sensex was trading at 18,999, down 47 points and the Nifty fell 15 points to 5,696.

Among frontliners, Wipro was trading at Rs 456.35, down 4.53% (after quarterly numbers), ONGC was at Rs 1,108.35, down 2.27% (Oil spill reported from ONGC`s fields off Mumbai coast); Sterlite Industries was at Rs 177.40, down 1.74%; DLF was at Rs 252, down 1.7%; ITC was at Rs 168.95, down 1.63% (after quarterly numbers); HCL Tech was at Rs 499.50, down 2.22% and ACC was at Rs 995.05, down 2.14%.

However, Reliance Infrastructure, Reliance Communications, SBI, Reliance Industries, BHEL, Reliance Power and Sesa Goa gained 1.3-2.9%.

In midcap space, Motilal Oswal rallied 12%. Cholamandalam, HMT, BOC India and Peninsula Land gained 4.5-5% while Financial Tech, Persistent, KGN Industries, Kirloskar Brothers and Polaris slipped 3.8-6%.

In smallcap space, Valecha Engg, Lloyds Metals, Hanung Toys, Hyderabad Inds and Splash Media rallied 8-17% whereas Rossell Tea, SML Isuzu, Spectacle Info, Prabhav Indust and Centrum Finance lost 4.6-5%.

TVS Motor Q3 net profit up 137% at Rs 55.7 cr

TVS Motor has announced its third quarter results. The company’s Q3 net profit was up 137% at Rs 55.7 crore versus Rs 23.5 crore, year-on-year, YoY.

Its net sales were up 50.19% at Rs 1,613 crore versus Rs 1,072.6 crore, YoY.

n a press conference, TVS Motor said:
-2 -Wheeler sales volume up 39%
-3-Wheeler sales crossed 10,000 units for the 1st time
-Topline growth continues to be good
-Should be able to protect margins
-Commodity prices to soften in next fiscal
-Expect CAGR of 14-15% over next 2-3 years
-Will launch two new variants of Apache & Scooty
-Very positive response for 3-wheelers
-3-Wheeler export sales to outpace domestic sales in 1 year
-Supply chain effectiveness improving

The company's trailing 12-month (TTM) EPS was at Rs 2.93 per share. (Sep, 2010). The stock's price-to-earnings (P/E) ratio was 21.71. The latest book value of the company is Rs 18.22 per share.

At current value, the price-to-book value of the company was 3.49. The dividend yield of the company was 1.89%.

Food inflation eases, but RBI action seen

Food inflation eased for the second straight week in January, tracking lower fruit and vegetable prices, but accelerating headline inflation in December is likely to put pressure on the Reserve Bank to raise rates at policy review on January 25.

India's food inflation quickened to a one-year high late last month as unseasonal rains spoilt summer harvest of perishable vegetables like onions, potatoes and tomatoes in several key producing states.

ndia's food price index rose 15.52% and the fuel price index climbed 11.53% in the year to January 8, government data on Thursday showed.

In the prior week, annual food and fuel inflation stood at 16.91% and 11.53%. The primary articles price index was up 17.03% in the latest week, compared with an annual rise of 17.58% a week earlier.

Analysts expect food prices to moderate by February, but they would still remain high.

"The build-up of food inflation will take two months to dissipate. So, it will moderate in January and February and we expect food inflation at 10% to 12% by March," said Abheek Barua, chief economist at HDFC Bank.

"I expect the RBI (Reserve Bank of India) to continue to be hawkish and continue with its rate hikes as non-food primary product inflation is sticky and can have pass through effect into wages and general prices," Barua said.

The wholesale price index, the most widely watched gauge of prices in India, rose 8.43% in December from a year earlier, compared with 7.48% in November, reflecting that food inflation has fed into the broader economy.

While monetary measures are largely ineffective in tackling supply-led problems like food inflation, the RBI is widely expected to raise policy rates by 25 basis points in its January 25 policy review to rein in inflationary expectations and dampen overall demand.

India's 5-year swap rate was down 2 basis points to 8% on a knee-jerk reaction after weekly food inflation eased, but rose back to previous levels as rate hike concerns and a hawkish policy stance weighed.

This week, the RBI governor Duvvuri Subbarao said that the central bank is 'desperate' to control inflation, in a sign which is being widely read as indicative of further monetary tightening.

Finance Minister Pranab Mukherjee met state finance ministers on Wednesday and said local factors are widening the gap between wholesale and retail prices.

Mukherjee said the federal government has taken measures to facilitate imports and restrict exports where needed, but urged state governments to review local levies and state level marketing regulations which add to food prices.

Bharti Airtel foresees super success on MNP platform

Mobile number portability (MNP)—a move that is expected to further intensify competition in the already crowded mobile services market. With the implementation of MNP, subscribers would get a wider choice and would be able to switch between service providers easily, thus compelling service providers to offer competitive pricing plans and offer higher service quality to attract and retain subscribers.

Calling today a historic day for the industry, number one telecom company (by market cap) Bharti Airtel's CEO Sanjay Kapoor said that the data indicated that bigger operators would get bigger after number portability. "And, we are a product of competition; customers believe in our strategy."

Nifty ends with moderate gains; financials, IT rise

Equity benchmarks closed with moderate gains after showing a smart recovery in the last couple of hours of trade on Thursday. Technology, financial and select power companies' shares led the recovery and pulled the Nifty up above the 5700 mark as well as the Sensex above the 19000 level. Indices had slipped close to 1% in the first half of trade today due to weak global cues.

Cabinet reshuffle and mobile number portability rollout did not have much impact on markets. Overall, indices were extremely volatile in trade. Naresh Kothari president of Edelweiss Capital expects this trend to continue in the first half of this calendar year.

Deven Choksey of KR Choksey Securities feels that the Nifty is likely to be in a range between 5700-5900 as earnings are largely inline with estimates. "Traders need to be cautious," he said.

However, the sell-off in oil & gas and select metal companies' shares along with ITC, Bharti, Bajaj Auto, Maruti and BHEL capped gains in late trade.

The 30-share BSE Sensex closed at 19,046.54, up 68.22 points or 0.36% and the 50-share NSE Nifty rose 20.55 points or 0.36% to settle at 5,711.60. Broader indices were quiet in trade today.

Rangarajan sees inflation at 6-6.5% by March

There is room for monetary action on the inflation front according to Prime Minister's Economic Advisory Council Chairman C Rangarajan. He expects WPI inflation to be between 6-6.5% by the end of March. "Inflation above 4% is uncomfortable and if it remains sticky, RBI steps may be needed. We may see action from the Reserve Bank by mid-January if inflation is firm," he says adding that the quantum of any rate hike depends on inflation.

Further he states that the government should guard against food inflation spreading to other sectors. He also alarms the spill over of untamed primary article inflation as well. "Price stability has to become the dominant issue for monetary policy in India," Rangarajan adds.

Food inflation accelerated to above 14% in mid-December on the back of high onion and vegetable prices and annual headline inflation, currently at 7.48% in November, could accelerate further in December.

Talking about fiscal deficit, which has been a matter of grave concern, Rangarajan says he sees the government meeting its fiscal 2011 aim. "There is no need for extra borrowings this fiscal. We also expect the liquidity situation to improve this quarter," he points out.

Commenting on the talks about government deregulating diesel prices, he says it may do so when inflation eases.

Nifty ends below 6100; Bank, Realty, Auto indices dip 2%

Equity benchmarks saw a profit taking on Wednesday on the back of sell-off in financial, auto, metal, realty, telecom and capital goods companies' shares. The benchmark Nifty slipped below 6100-mark in second half of trade, especially after a fall in global markets.

Experts feel that markets are riding low and all eyes are on the third quarter earnings that will kick-start next week. Sandeep J Shah of Sampriti Capital said that the upside maybe 6,200-6,400 but it will not ride away at that level. He is also concerned on the foreign institutional investor (FII) inflows to India.

“Insurance companies inflows are very muted, domestic mutual funds redemptions continue, some of the HNI’s and retail, at least a part of them have perhaps left the market because of the corruption, the scams that have been unearthed,” he explained.

European markets - France's CAC and Germany's DAX were down 1% each; FTSE fell just 0.2%, at the time of closing Indian equities. Even US index futures like Dow Jones and Nasdaq declined 0.5% each. Shanghai fell 0.5% and Taiwan tanked 1.7%.

Jim Walker, MD of Asianomics said that Europe is a bigger problem than China and US. “Europe is going to see political turmoil,” he explained.

According to him, the US economy may see weakness in the next six months. Expressing concern, Walker stressed that there might be monetary tightening across Asia. He believes that the Reserve Bank of India (RBI) is likely to hike interest by 25 bps this month.

Rate sensitives and commodities dragged the markets lower today. The BSE Bank, Realty and Auto indices lost 2% each; Capital Goods Index fell 1.6%. However, TCS, ITC, HUL, HCL Tech, Sesa Goa, Tata Power, Hindalco, Dr Reddy's Labs and Wipro were the only gainers.

The 30-share BSE Sensex closed at 20,301.10, down 197.62 points or 0.96% and the 50-share NSE Nifty fell 66.55 points or 1.08% to settle at 6079.80. The broader indices too slipped one percent each.

In financial space, ICICI Bank, IDFC and HDFC fell 3% each; SBI, HDFC Bank, Axis Bank and Kotak Mahindra Bank were down 1.5-2.75%. PNB lost 1.25%. DLF from realty pack tumbled 3.36%.

Bajaj Auto from auto space plunged 3.87% as one international research firm downgraded the stock to underperform from outperform. Hero Honda tanked 3.8%; M&M, Maruti Suzuki and Tata Motors fell 1% each.

L&T and BHEL from capital goods segment went down 2.4% & 1.1%, respectively. Heavyweights Bharti Airtel and ONGC were down 2% & 1.6%. Even Reliance Industries was just in red.

Anil Dhirubhai Ambani Group companies' shares like Reliance Infrastructure, Reliance Capital and Reliance Communications cracked 2.6-3% while Reliance Power rose 0.57%. ITC and HUL from FMCG space were up 1.3-1.5%.

In metal space, SAIL, Sterlite Industries and Tata Steel were down 1.5-2% whereas Hindalco and Sesa Goa gained 1-1.9%. Infosys from technology pack lost 0.6% while TCS was up 1.24% and HCL Tech up 2.4%. Wipro gained just 0.2%.

In midcap space, Jindal Saw, KGN Industries, Jain Irrigation, Gujarat Flourochem and Shriram City gained 3-7% while Rashtriya Chemical, Sadbhav Engg, Anant Raj Industries, GSFC and Apollo Tyres lost 4.75-5.5%.

In smallcap space, Fame India shot up 19.69% as Reliance Mediaworks increased stake to 44% in company. Indo Tech Transformers jumped 17%. Transformers & Rectifiers, Camlin and INOX Leisure rose 6.8-11.7%.

However, Mandhana Industries, Splash Media, Sagar Cement, SE Investments and Hinduja Foundries declined 5.7-8%.

Breadth was in favour of declines; about 1028 shares advanced as against 1953 shares declined on Bombay Stock Exchange.

Total traded turnover on exchanges stood at Rs 1,13,705.1 crore. This included Rs 13,072.32 crore from NSE cash segment, Rs 96,562.35 crore from NSE F&O and the rest of Rs 4,070.43 crore from BSE cash segment.

Global cues drag Nifty below 6100; banks, cap goods dip

The benchmark Sensex shed around 200 points in afternoon trade while the Nifty was trading well below the 6100 level, led by further sell-off in financial, capital goods, realty, metal and auto companies' shares along with heavyweights ONGC (tanked 2%) and Infosys (down 0.8%). Reliance Industries too slipped into red.

Weak European cues weighed on markets; France's CAC, Germany's DAX and Britain's FTSE were down 0.5-1%. Even Dow Jones and Nasdaq futures declined 0.5% each.

Jim Walker, MD of  Asianomics said that Europe is a bigger problem than China and US. “Europe is going to see political turmoil,” he explained.

According to him, the US economy may see weakness in the next six months. Expressing concern, Walker stressed that there might be monetary tightening across Asia. He believes that the Reserve Bank of India (RBI) is likely to hike interest by 25 bps this month.

However, buying continued in ITC, TCS, Sun Pharma, Hindalco, HCL Tech, Tata Power, Wipro, GAIL, Reliance Power and Dr Reddy's Labs.

The 30-share BSE Sensex was trading at 20,253, with loss of 245 points and the 50-share NSE Nifty lost 80 points to 6,066. The broader indices too fell 1% each. However, the Nifty January futures were trading at 25 points premium.

In financial space, ICICI Bank and HDFC tanked 3.5% each. Axis Bank, HDFC Bank, SBI, PNB and Kotak Mahindra Bank were down 1.7-3%. DLF from realty pack fell 3%.

Bharti Airtel and Reliance Communications from telecom space slipped 2.2-2.7%. L&T and BHEL from capital goods segment were down 2.6% & 1.5%, respectively.

Bajaj Auto from auto pack lost 3%; Hero Honda, Tata Motors, M&M and Maruti Suzuki declined 0.7-2.7%. Sterlite Industries, Tata Steel and SAIL from metal space slipped 1.9% each.

In midcap space, Jindal Saw, KGN Industries, Shriram City, Eicher Motors and Bayer Cropscience were up 1.9-5.4% while Anant Raj Industries, GSFC, Syndicate Bank, Stride Arcolab and Amtek Auto fell 4-5.4%.

In smallcap space, Fame India shot up 18% as Reliance Mediaworks increased stake to 44% in company. Indo Tech Transformers rallied 17%. Transformers & Rectifiers, Navin Fluorine and DQ Entertain gained 6-9%.

However, Mandhana Industries, Sahara One, Splash Media, Shasun Chemical and SE Investments slipped 5-6%.

About 895 shares advanced as against 1993 shares declined on Bombay Stock Exchange.

Reliance MediaWorks hikes stake to 44% in Fame India

Anil Ambani-promoted Reliance MediaWorks has acquired 32% of Emerging Equity in Fame India via open offer, reports CNBC-TV18's Tanvi Shukla quoting sources. Earlier Reliance Media held 12% of Emerging Equity in Fame India.

It has been a tough fight between Inox and Reliance MediaWorks to acquire Fame India. Post, market regulator SEBI’s clearance to both the open offers i.e. Inox and Reliance MediaWorks for Fame India, the latter is learnt to have pocketed the stake.

It is learnt that Reliance made an open offer to acquire 53.8% stake in Fame India with an open offer price of Rs 83.40 per share.  Rival Inox holds 50.2% stake in the multiplex company.

The takeover battle for Fame began in February when Reliance MediaWorks launched a hostile bid. It accused Fame of rejecting its higher offer price in favour of Inox and petitioned SEBI that the deal was against the “protection of the interest of minority retail shareholders.”

Nifty volatile; ICICI Bk, Bajaj Auto, Axis Bk, HDFC down

The Nifty was hovering around 6100 mark with negative bias. It was a weak session for the markets on back of heavy selling in banks. Selling was also seen in capital goods, realty and auto stocks. Buying was seen in FMCG and IT stocks. The broader markets too were trading weak. BSE Midcap and Smallcap indices were down 0.5% each.

The Sensex was down 94.33 points or 0.46% at 20404.39, and the Nifty was down 36.75 points or 0.60% at 6109.60. About 1152 shares advanced, 1634 shares declined, and 392 shares remain unchanged.

In the largecap space, HCL Tech, Sun Pharma, Hindalco, TCS and Tata Power were up 1.4-2.7%. On the losing side, ICICI Bank, Bajaj Auto, Axis Bank, HDFC and Kotak Mahindra Bank were down 2-3%.

Index heavyweight Reliance was trading at Rs 1,083.05 up 0.6% from its previous close of Rs 1,076.55. Refinery major HPCL was trading at Rs 391.80 down 0.11% from its previous close of Rs 392.25.

Hindustan Lever was trading at Rs 321.90 up 0.26% from its previous close of Rs 321.05. Cigarette major ITC was trading at Rs 179.95 up 1.41% from its previous close of Rs 177.45.

Top gainers on the BSE Midcap: Jindal Saw, KGN Industries, EID Parry, Glodyne Techno and Hindustan Constructions were up 3-7%.

Top losers on the BSE Midcap: Anant Raj Industries, IBN18 Broadcast, Amtek Auto, Allahabad Bank and Syndicate Bank were down 3.5-5%.

Top gainers on the BSE Smallcap: Fame India, Transformers, Indo Tech Transformers, Jamna Auto and Welspun India were up 6-14%.

Top losers on the BSE Smallcap: Rollatainers, Spectacle Info, Sujana Towers, Urja Global and SVC Resources were down 4.8-5%.

Lokmat Media plans IPO to fund expansion

One of India's leading print media businesses Lokmat Media has proposed to tap the capital market for funding its expansion plan. It has filed draft red herring prospectus (DRHP) with the SEBI for public issue of 13,829,064 equity shares.

It publishes three newspapers: Lokmat in Marathi, Lokmat Samachar in Hindi and Lokmat Times in English which collectively have 17 editions and 58 sub-editions.


Lokmat Media's flagship newspaper Lokmat has been the leading Marathi newspaper in terms of average daily circulation and average daily readership in Maharashtra in 2008, 2009 and for the six month period ended June 30, 2010 (Source: ABC January-June and July-December, 2008 and 2009 and January-June, 2010 and IRS 2008 R2, IRS 2009 R2 and IRS 2010 Q3) and in terms of average daily circulation in Goa in 2009 and for the six month period ended June 30, 2010 (Source: ABC, July-December 2009 and January-June 2010).

It has also into broadcasting business, which is conducted through a 50-50 joint venture with ibn18 Broadcast Limited. The joint venture company, IBN-Lokmat News Private Limited (IBNL), operates IBN-Lokmat, a 24-hour Marathi news and current affairs television channel which went on air on April 6, 2008. It also recently entered the film production and distribution business and in August 2010, released debut film in Marathi, entitled Jetaa, in association with Ramesh Deo Production Private Limited.

Promoters Mr Vijay Darda and Mr Rajendra Darda hold 54.75% stake in company and other family members hold 45.25% stake, which will be reduced to 41.07% & 33.93% post issue.

Company intends to use net issue proceeds of Rs 368.6 crore for upgrading existing printing facilities (Rs 150.36); building capability for expansion to new markets (Rs 90 crore); brand building, promotion and marketing (Rs 30 crore); pre-payment and repayment of loans (Rs 48.23 crore; acquiring and co-producing Indian films, including primarily Marathi language films as well as certain Hindi language films (Rs 25 crore); and investment in IBNL (Rs 25 crore).

For the year ended May 31, 2010, Lokmat Media reported a net profit of Rs 49.5 crore on total income of Rs 391.21 crore.

Book running leading managers to the issue are Kotak Mahindra Capital Company Limited and Enam Securities Private Limited.

Nifty in narrow range; RIL, ITC, NTPC, HUL, Infy, Cairn up

Equity benchmarks were consolidating at around yesterday's closing values after seeing rally in previous four sessions. The Nifty was trading in a narrow range of 6125-6160, with a negative bias. Financial, telecom, capital goods, realty and auto companies' shares were on sellers' radar along with Hindalco, ONGC, TCS and Tata Steel.

The 30-share BSE Sensex was trading at 20,499, with loss of 61 points and the 50-share NSE Nifty declined 15 points to 6,142.

Experts are bullish on Indian markets, even though the year kick-started with tepid volumes and just about a modest price appreciation. Kalpana Morparia, CEO, JP Morgan is expecting the Sensex to be at 24,000 by the year-end.

She said, “We certainly believe that we are in for a 20% increase. If you then factor in a slight appreciation in the rupee, we would probably see returns for foreign investors in excess of 20%.”

Financial space was witnessing selling pressure today, especially after HDFC Bank raised its interest rates on retail term deposits by up to 1.25% depending on the maturities. The rate hike will be effective January 1. However, this will squeeze margins of banks. Even Bank of India also revised deposit rates in some maturities, effective from January 03, 2011.

HDFC Bank fell 1.5%; India's largest banks - SBI and ICICI Bank lost 2.5-3.2%. Axis Bank was down 1.2% and IDFC down 1.6%.

Telecom players like Bharti Airtel was down 1.3% and Reliance Communications down 1.9%. L&T and BHEL from capital good space declined 0.5-0.7%.

In auto space, Bajaj Auto tanked 3%. Tata Motors, Maruti, M&M and Hero Honda were down 0.25-1%. DLF from realty space fell 0.9%.

However, buying continued in power and FMCG companies' shares along with Reliance Industries, Infosys, JSPL, Wipro, Sterlite, Dr Reddy's Labs, Ranbaxy Labs and HDFC, which capped losses.

In midcap space, Kirloskar Brothers shot up 12.3%. Kwality Dairy, Peninsula Land, Zydus Wellness and Bombay Rayon gained 4.5-7.6% while Dewan Housing, KGN Industries, IndusInd Bank, Central Bank and Allahabad Bank fell 3-4%.

In smallcap space, Mandhana Industries and Varun Industries surged 17% each. Shasun Chemical, Infinite Comp and Advanta gained 8% each. However, Timken, Ganesh Housing, Midfield Industries, Sujana Towers and Spectacle Info slipped 5-5.7%.

About 1362 shares advanced as against 1374 shares declined on Bombay Stock Exchange.

Spain's Gamesa may buy majority stake in Suzlon: Sources

Spain's top wind turbine manufacturer Gamesa is likely to pick up majority stake in Suzlon, reports CNBC-TV18 quoting sources.

It is learnt that the deal is likely to value Suzlon at market cap of around USD 3 billion while its current market cap is at around USD 2 billion.

Sources add that the deal will involve payment of non-compete fee to promoters. However, Suzlon has refused to comment stating that it is a market speculation.

Following the report, Suzlon rose more than 5% on the bourses.

Conceived in 1995 with just 20 people, Suzlon is a leading wind power company with over 16,000 people in 25 countries across Americas, Asia, Australia and Europe.

Sensex likely to be at 24K by year-end: JP Morgan

Experts are bullish on Indian markets, even though the year kick-started with tepid volumes and just about a modest price appreciation. Kalpana Morparia, CEO, JP Morgan is expecting the Sensex to be at 24,000 by the year-end.

In an interview to CNBC-TV18, she said, “We certainly believe that we are in for a 20% increase. If you then factor in a slight appreciation in the rupee, we would probably see returns for foreign investors in excess of 20%.”