Cash-Flush Uti Scrounges Market
Flush with funds the Unit Trust of India (UTI) has once again turned an aggressive buyer at the bourses after a brief lull. With most of the players preferring to remain fence sitters, UTI seems to have taken the initiative of reviving sentiments.
Yesterday, aggressive purchases by UTI at the Telco, Tisco and some of the secondline stocks in the specified group sent short-sellers rushing to cover up their positions.
The rally was sparked off by purchases at the Telco counter. A leading domestic fund is reported to have picked up a few lakh shares of the scrip. Buying support from UTI further pushed up the price, forcing short-sellers to cover up their positions.
There were also rumours that the finance minister would be rolling back the excise duty on utility vehicles. The feeling was reinforced by the fact some of the budget proposals had been rolled back earlier.
Even as market players were trying to confirm the rumours, stock prices of M&M and Ashok Leyland firmed up sharply.
The M&M scrip bounced back from the day's low of Rs 136 on the BSE, also a new 52-week low for the scrip, to close at Rs 146.80.
Despite the market players expressing initial disappointment with Reckitt & Coleman's results, UTI seems to think otherwise.
On Tuesday, it is reported to have purchased over a lakh shares of the scrip.
Yesterday too it was reported to have made aggressive purchases at the counter though the numbers could not be confirmed.
Reckittt & Coleman reported a net profit of Rs 15.34 crore for the first half as compared with Rs 17.88 crore for the corresponding period of the previous fiscal. Players feel the dip is negligible considering the fact that the company managed such a good show even without its prized brand, Dettol, which it had sold off.
Also other income has fallen sharply this time, clearly indicating that the quality of earnings has risen, if not the income itself. Similarly in the case of ITC, even though marketmen have given a thumbs down sign to the results, UTI has made use of the opportunity to make some good purchases at the counter. It is reported to have purchased nearly 1.5 lakh shares of the scrip on Tuesday.
UTI is also reported to have been a buyer at the Cummins counter. On the BSE, the scrip clocked a volume of 1.36 lakh shares, significantly high for the counter.
SBI MF too is using the slump in prices to include some more of the stock in its portfolio. On Tuesday, the fund is reported to have purchased around 1.5 lakh shares of ITC.
On the selling side, a pension fund is reported to have sold around 60,000 shares of ITC.
An offshore fund is reported to have pressed sales for around 80,000 shares of the Zee Telefilms on Tuesday.
As against this sale it is reported to have purchased around 30,000 shares of BHEL, 20,000 shares of ITC and around 60,000 shares of Satyam Computers.
The L&T scrip seems to have been the main cause for the negative FII figures on Tuesday. A foreign fund is reported to have sold around five lakh shares of the scrip. MTNL too is reported to have figured on the FII sell list on Tuesday with over 60,000 shares having been sold by a fund.
Foreign funds are reported to be picking up select software stocks at every decline.
A leading US based fund is reported to have purchased close to two lakh shares of the Wipro scrip during the no-delivery period.
Another US-based fund seems to be in a tearing hurry to get out of the Pentafour Software counter. The fund which has a significant holding in the scrip is reported to have sold around 6-8 lakh shares of the scrip over the past ten trading sessions.