Infosys vaults after retaining FY 2014 dollar revenue guidance

Key benchmark indices trimmed gains after a firm start. Infosys jumped over 13% after the company retained its guidance of 6% to 10% growth in revenue in dollar terms for the year ending 31 March 2014 (FY 2014) after announcing Q1 June 2013 results before trading hours. Other stocks from the IT pack also gained after Infosys' Q1 results. The S&P BSE Sensex was up 143.46 points or 0.73%, off about 140 points from the day's high and up close to 15 points from the day's low. The 50-unit CNX Nifty fell below the psychological 6,000 level soon after a firm opening took the index above that level at the onset of the trading session. The market breadth, indicating the overall health of the market, was strong. Tata Motors rose after the company's British luxury car unit, Jaguar Land Rover (JLR), reported good sales for June 2013.

Hindustan Petroleurn Corporation (HPCL) rose after the company signed a joint venture agreement with the Rajasthan state governemnt (GOR) for setting up a 9 million metric tonnes per annum (MMTPA) grass root refinery cum petrochemical complex at Pachpadra in Barmer district in Rajasthan. Sun Pharmaceutical Industries hit record high after the company said it has received final approval from the United States Food and Drug Administration (USFDA) to launch the generic version of a diabetes drug.

Foreign institutional investors (FIIs) bought shares worth a net Rs 638.26 crore on Thursday, 11 July 2013, as per provisional data from the stock exchanges.

At 9:30 IST, the S&P BSE Sensex was up 143.46 points or 0.73% to 19,819.52. The index jumped 286.72 points at the day's high of 19,962.78 in early trade. The index gained 128.43 points at the day's low of 19,804.49 in early trade.

The CNX Nifty was up 27.80 points or 0.47% to 5,962.90. The index hit a high of 6,018.40 in intraday trade. The index hit a low of 5,961.65 in intraday trade.

The market breadth, indicating the overall health of the market, was strong. On BSE, 461 shares rose and 287 shares fell. A total of 27 shares were unchanged.

From the 30-share Sensex pack, 20 stocks fell and rest of them rose. Tata Power Company (down 1.7%), Maruti Suzuki India (down 1.38%) and Cipla (down 1.3%), edged lower.

Infosys jumped 13.39% after the company retained its guidance of 6% to 10% growth in revenue in dollar terms for the year ending 31 March 2014 (FY 2014). The company raised the guidance in rupee terms due to a steep depreciation of the rupee against the dollar. The company has forecast 13% to 17% growth in revenue in rupee terms for FY 2014, higher than its earlier guidance of 6% to 10% growth which the company had given at the time of announcement of Q4 March 2013 results.

The company's consolidated net profit declined 0.8% to Rs 2374 crore on 7.8% growth in revenue to Rs 11267 crore in Q1 June 2013 over Q4 March 2013. The results are as per International Financial Reporting Standards (IFRS). The company announced Q1 result before market hours today, 12 July 2013.

Infosys Chief Financial Officer (CFO) Rajiv Bansal said that the company has announced compensation increases for FY 2014 effective July which will affect the company's profit margins in the future quarters. Infosys CEO and Managing Director S. D. Shibulal said that the management is cautiously optimistic about rest of the year. Despite facing an uncertain macro environment, changing regulatory regime and a volatile currency environment, the company has done well in Q1 June 2013, he said.

Infosys and its subsidiaries added 66 clients in Q1 June 2013. There was a gross addition of 10,138 employees and net addition of 575 employees by Infosys and its subsidiaries in Q1.

Infosys' liquid assets including cash and cash equivalents, available-for-sale financial assets, and government bonds were at Rs 24078 crore as on 30 June 2013, higher than Rs 23958 crore as on 31 March 2013.

Other stocks from the IT pack also gained after Infosys' Q1 results. TCS (up 3.52%) and Wipro (up 2.7%), edged higher.

Tata Motors rose 0.49% after the company's British luxury car unit, Jaguar Land Rover (JLR), on Thursday, 11 July 2013, said its sales rose 7% to 33,739 vehicles in June 2013 over June 2012. Sales of the Jaguar brand jumped 34% to 6,574 vehicles in June 2013 over June 2012. Land Rover sales rose 2% to 27,165 units in June 2013 over June 2012 despite the run out of Range Rover Sport, JLR said.

During the first six months of 2013, JLR sold 210,190 vehicles, an increase of 14% versus the same period last year.

Commenting on the half year performance Phil Popham, Jaguar Land Rover Group Sales Operations Director said "It is very encouraging to see both our Jaguar and Land Rover brands delivering strong sales performances across our 178 markets. New model introductions have been incredibly well received with the all-new Range Rover retailing more than 22,000 units since launch. The F-TYPE which received a rapturous reception from media during its global launch last month is off to an excellent start with new customers and will go on sale in China this month".

Sun Pharmaceutical Industries rose 0.45% to Rs 1100 after the company announced before market hours today, 12 July 2013, that USFDA has granted its subsidiary final approval for its Abbreviated New Drug Applications (ANDA) for generic version of Prandin, Repaglinide tablets. The stock hit record high of Rs 1111 in intraday trade today, 12 July 2013. Repaglinide tablets, 1 mg and 2 mg are therapeutic equivalents of Novo Nordisk's Prandin tablets. These tablets have annual sales of approximately $200 million in the US. Repaglinide tablets are indicated as an adjunct to diet and exercise to improve glycemic control in adults with type-2 diabetes mellitus. Sun Pharma's subsidiary, being the first-to-file an ANDA for generic Prandin with a para IV certification, is eligible for a 180-day marketing exclusivity in the US.

Dr Reddy's Laboratories declined 1.17% as the stock turned ex-dividend today, 12 July 2013, for final dividend of Rs 15 per share for the year ended 31 March 2013 (FY 2013).

Hindustan Petroleurn Corporation (HPCL) rose 0.54% after the company signed a joint venture agreement with the Rajasthan state governemnt (GOR) for setting up a 9 million metric tonnes per annum (MMTPA) grass root refinery cum petrochemical complex at Pachpadra in Barmer district in Rajasthan. The estimted cost of the project is Rs 37230 crore. HPCL will hold 74% stake and the Rajasthan state government will hold 26% in the refinery. A Memorandum of understanding has already been signed between HPCL and Government of Rajasthan on 14 March 2013 stipulating broad parameters for the implementation of the project. Detailed Feasibility Study, Financial appraisal, Economic Impact assessment study, etc have been completed.

The proposed 9 MMTPA grass root refinery cum petrochemical complex will source crude from Rajasthan oil fields and other imported crudes. This refinery js expected to be completed in 4 years and will have substantial positive impact on the economy of Rajasthan state, HPCL said. This refinery will produce various petroleum and petro-chemical products. The project is expected to bring accelerated growth to the region and provide huge opportunity for downstream petrochemical industries which in turn will further boost the economy of the state.

JSW Energy declined 3.16% as the stock turned ex-dividend today, 12 July 2013, for dividend of Rs 2 per share for the year ended 31 March 2013 (FY 2013).

Dewan Housing Finance Corporation dropped 1.12% as the stock turned ex-dividend today, 12 July 2013, for final dividend of Rs 3 per share for the year ended 31 March 2013 (FY 2013).

MindTree rose 2.26%. The stock turned ex-dividend today, 12 July 2013, for final dividend of Rs 5 per share for the year ended 31 March 2013 (FY 2013).

Tata Elxsi dropped 2.02% as the stock turned ex-dividend today, 12 July 2013, for dividend of Rs 5 per share for the year ended 31 March 2013 (FY 2013).

On macro front, industrial production is seen rising a tepid 1.5% in May 2013, as per the median estimate of a poll of economists carried out by Capital Market. Industrial production had risen 2.3% in April 2013. The government unveils industrial production data for May 2013 today, 12 July 2013.

Inflation based on the combined consumer price index (CPI) of urban and rural India is projected at 9.3% in June 2013, same as it May 2013, as per the median estimate of a poll of economists carried out by Capital Market. CPI inflation had eased to 9.31% in May 2013 from 9.39% in April 2013. The government unveils CPI data for June 2013 today, 12 July 2013.

Most Asian stocks fell on Friday, 12 July 2013. Key benchmark indices in China, Hong Kong, Singapore and South Korea fell by 0.38% to 0.6%. Key benchmark indices in Indonesia and Japan rose by 0.1% to 0.13%. Taiwan's Taiwan Weighted was flat.

China's finance minister on Friday, 12 July 2013, said economic growth will likely average 7% this year. The projection is lower than the government's target of 7.5%.

US stocks surged to an all-time high on Thursday after the Federal Reserve chairman Ben Bernanke said on Wednesday, 10 July 2013, the central bank will keep supporting the economy. In a speech late Wednesday after US markets had closed, Fed chairman Ben Bernanke said the economy needs the central bank's easy-money policy for the foreseeable future. The US economy needs help because unemployment is high, he said.

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