SBI vaults in volatile trade after Q2 result

Key benchmark indices extended gains to hit fresh intraday high in afternoon trade. The S&P BSE Sensex was up 71.83 points or 0.35%, up 129.55 points from the day's low and off 8.03 points from the day's high. The market breadth, indicating the overall health of the market, was negative.

Banking giant State Bank of India (SBI) gained in volatile trade after declaring Q2 result. Index heavyweight and cigarette major ITC slipped. Another index heavyweight Reliance Industries (RIL) gained. Reliance Communications (RCom) extended intraday gain on strong Q2 result. Other telecom stocks were mixed.

The market regained positive terrain after opening lower. The S&P BSE Sensex and the 50-unit CNX Nifty, both, recovered after hitting their lowest level in nearly five weeks. It alternately hovered between gains and losses in morning trade. It slipped into the red after hitting fresh intraday high in mid-morning trade. It once again regained positive terrain in early afternoon trade. Key benchmark indices extended gains to hit fresh intraday high in afternoon trade.

At 13:16 IST, the S&P BSE Sensex was up 71.83 points or 0.35% to 20,353.74. The index fell 57.72 points at the day's low of 20,224.19 in early trade, its lowest level since 10 October 2013. The index rose 79.86 points at the day's high of 20,361.77 in afternoon trade.

The CNX Nifty was up 18.65 points or 0.31% to 6,036.70. The index hit a low of 5,994.25 in intraday trade, its lowest level since 10 October 2013. The index hit a high of 6,041.55 in intraday trade.

The market breadth, indicating the overall health of the market, was negative. On BSE, 1,164 shares fell and 1,117 shares rose. A total of 151 shares were unchanged.

The total turnover on BSE amounted to Rs 1131 crore by 13:25 IST.

Among the 30-share Sensex pack, 20 stocks rose and rest of them fell. Sun Pharmaceutical Industries (up 2.74%), Hindustan Unilever (up 2.25%) and Tata Motors (up 2.19%), gained.

GAIL (India) (down 1.69%), Cipla (down 1.6%) and Sesa Sterlite (down 1.17%) declined.

State Bank of India (SBI) rose 2.96% to Rs 1725. The stock was volatile. It high a high of Rs 1735 and low of Rs 1653.40 so far during the day. The bank's net profit fell 35.08% to Rs 2375.01 crore on 12.89% increase in total income to Rs 37,199.92 crore in Q2 September 2013 over Q2 September 2012. The result was announced during trading hours today, 13 November 2013.

State Bank of India's ratio of net non-performing assets (NPA) to net advances stood at 2.91% as on 30 September 2013, compared with 2.83% as on 30 June 2013 and 2.44% as on 30 September 2012.

The bank's ratio of gross NPA to gross advances stood at 5.64% as on 30 September 2013, compared with 5.56% as on 30 June 2013 and 5.15% as on 30 September 2012.

Provisions and contingencies rose 65.90% to Rs 3028.74 crore in Q2 September 2013 over Q2 September 2012. The provisioning coverage ratio as on 30 September 2013 stood at 60.16%.

The bank's Capital Adequacy Ratio (CAR) as per Basel III norms stood at 11.69% as on 30 September 2013, compared with 11.85% as on 30 June 2013.

Index heavyweight and cigarette major ITC fell 0.63% to Rs 317.75.

Index heavyweight Reliance Industries (RIL) gained 0.59% to Rs 857.5.

Reliance Communications (RCom) jumped 7.08% on strong Q2 result, with the stock extending intraday gain. The company's consolidated net profit spurted 562% to Rs 675 crore on 3.7% growth in operating revenue to Rs 5394 crore in Q2 September 2013 over Q2 September 2012. The result was announced after market hours on Tuesday, 12 November 2013.

RCom's consolidated profit after tax (PAT) excluding provision write-back surged 129.4% to Rs 234 crore in Q2 September 2013 over Q2 September 2012. There was a provision write-back of Rs 441 crore in Q2 September 2013.

RCom's operating EBITDA (earnings before interest, taxation, depreciation and amortization) rose 15.2% to Rs 1887 crore in Q2 September 2013 over Q2 September 2012. Total EBITDA rose 42.1% to Rs 2328 crore.

RCom's revenue from India operations grew 5.4% to Rs 4624 crore in Q2 September 2013 over Q2 September 2012. EBITDA rose 15.1% to Rs 1640 crore.

The company's revenue from global operations declined 0.3% to Rs 1139 crore in Q2 September 2013 over Q2 September 2012. EBITDA grew 15.5% to Rs 246 crore.

RCom said it has generated operational cash flow (EBITDA) of Rs 2328 crore in Q2 September 2013, paid net finance charges of Rs 676 crore and invested Rs 364 crore on capex during the quarter. It remains free cash flow (FCF) positive and this is expected to continue, the company said in a statement.

Other telecom stocks were mixed. Bharti Airtel fell 0.64%. Idea Cellular gained 3.49%.

Bata India (up 3.8%), Bank of Baroda (up 3.63%), Thermax (up 3.85%), Ashok Leyland (up 2.95%) and Jain Irrigation Systems (up 2.78%) were the key gainers from the BSE's 'A' group.

The domestic bourses will remain shut tomorrow, 14 November 2013, on account of Moharram.

In the foreign exchange market, the rupee recovered against the dollar in choppy trade. The partially convertible rupee was hovering at 63.53, stronger compared with its close of 63.71 on Tuesday, 12 November 2013. The rupee was weak in early deals.

On macro front, index of industrial production (IIP) rose 2% in September 2013, showing increase in growth from 0.4% growth recorded in August 2013. The entire growth in IIP was mainly driven by 12.9% surge in electricity generation in September 2013. The mining output also witness rise in output, while the manufacturing sector output showed a marginal rise in September 2013. The industrial production growth for the month of August 2013 has been revised downwards to 0.4% from 0.6% reported earlier, while the growth for the month of June 2013 has undergone final revision, registering growth of (-1.8%). The data was announced after market hours on Tuesday.

The annual consumer price inflation quickened more than expected to 10.09% in October from 9.84% in September, driven by food prices, government data showed on Tuesday. Food prices for consumers last month rose 12.56% from a year earlier, faster than September's 11.44% rise. The data was announced after market hours on Tuesday.

Asian stocks fell on Wednesday after China's leaders failed to outline steps to curb state dominance of the economy and amid bets the Federal Reserve may start reducing U.S. stimulus next month. Key benchmark indices in China, Taiwan, Japan, South Korea, Singapore, Hong Kong and Indonesia shed 0.45% to 1.96%.

China elevated the role of markets while maintaining the state's dominance in the nation's economic strategy, seeking to balance finding new sources of growth with sustaining the Communist Party's grip on power. The nation will make markets "decisive" in allocating resources, according to yesterday's communique from the third full meeting, or plenum, of the party's 18th Central Committee in Beijing, which stopped short of unveiling detailed policy shifts. The state will remain "dominant" in the economy, indicating limits on reducing government involvement. China will set up a party panel to coordinate and supervise policies under the updated principles and more specific measures may follow in the coming weeks or months. The communique also announced the party's determination to draw a red line to protect the environment, after years of economic expansion have polluted China's soil, water and air. China will also reform its judicial system to protect people's rights, it said.

Trading in US index futures indicated that the Dow could fall 28 points at the opening bell on Wednesday, 13 November 2013. US stocks fell on Tuesday, with the Dow Jones Industrial Average retreating from a record, as corporate earnings and an improving economy fueled speculation the Federal Reserve will reduce stimulus next month.

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