Indian stocks fell for the third day in a row today, 29 April 2014, triggered by the India Meteorological Department (IMD) on Thursday, 24 April 2014, announcing that the country will likely get below-normal levels of monsoon rain this year. Investors also remained wary ahead of the announcement of Federal Reserve's monetary policy review tomorrow, 30 April 2014. The barometer index, the S&P BSE Sensex, Sensex was provisionally down 171.93 points or 0.76%, up about 15 points from the day's low and off close to 220 points from the day's high. The Sensex and the 50-unit CNX Nifty, both, hit their lowest level in almost two weeks. The market breadth, indicating the overall health of the market, was negative.
Metal stocks declined. Jindal Steel & Power slumped on weak Q4 results. Sesa Sterlite dropped as profitability declined sequentially in Q4.
The market dropped in early trade. It extended initial losses and hit fresh intraday low in morning trade. It languished in the negative terrain in mid-morning trade. It trimmed intraday losses in early afternoon trade. Key benchmark indices continued hovering in negative territory in afternoon trade. It remained weak in mid-afternoon trade.
Foreign institutional investors (FIIs) bought shares worth a net Rs 77.02 crore on Monday, 28 April 2014, as per provisional data from the stock exchanges.
As per provisional figures, the S&P BSE Sensex was down 171.93 points or 0.76% to 22,459.68. The index fell 188.05 points at the day's low of 22,443.56 in late trade, its lowest level since 17 April 2014. The index rose 50.28 points at the day's high of 22,681.89 in early trade.
The CNX Nifty was down 43.65 points or 0.65% to 6,717.60, as per provisional figures. The index hit a low of 6,708.65 in intraday trade, its lowest level since 17 April 2014. The index hit a high of 6,779.70 in intraday trade.
The BSE Mid-Cap index was down 32.37 points or 0.44% to 7,406.12. The BSE Small-Cap index was down 1.62 points or 0.02% to 7,615.66. Both these indices outperformed the Sensex.
The total turnover on BSE amounted to Rs 2853 crore, higher than Rs 2765.66 crore on Monday, 28 April 2014.
The market breadth, indicating the overall health of the market, was negative. On BSE, 1,510 shares fell and 1,277 shares rose. A total of 123 shares were unchanged.
Among the 30-share Sensex pack, 26 stocks declined and rest of them rose. SBI (down 2.08%), Hindustan Unilever (down 3.13%), and Maruti Suzuki India (down 2.17%), edged lower from the Sensex pack.
Metal stocks declined. JSW Steel (down 4.77%), Hindalco Industries (down 2.55%), Bhushan Steel (down 0.23%), Tata Steel (down 4.79%), Sail (down 4.26%), National Aluminum Company (down 1.76%) and Hindustan Copper (down 2.66%) declined. Hindustan Zinc rose 0.85%.
Jindal Steel & Power slumped 9.07% on weak Q4 results. The company's consolidated net profit fell 47% to Rs 402.50 crore on 10% decline in turnover to Rs 5102.56 crore in Q4 March 2014 over Q4 March 2013. The company announced results during market hours.
Sesa Sterlite dropped 2.1% as profitability declined sequentially in Q4. The company's consolidated net profit as per adjusted proforma basis fell 11.61% to Rs 3074 crore on 7.05% rise in net sales to Rs 20784 crore in Q4 March 2014 over Q3 December 2013. The Sesa Sterlite merger and the Vedanta Group consolidation was completed in August 2013, hence the adjusted proforma numbers are more representative of the performance during the quarter and full year. The company announced results during market hours.
Sesa Sterlite said that the Board of Directors of the company at its meeting held today, 29 April 2014, inter alia, have recommended final dividend of 175% for the year 2013-2014 (Rs 1.75 per share). The payment is subject to the approval of the shareholders in its Annual General Meeting which will be held on 11 July 2014 and the dividend shall be paid/despatched on or before the due date, i.e. 8 August 2014. Sesa Sterlite said that the Register of Members & Share Transfer Books of the company will remain closed from8 July 2014 to 10 July 2014 (both days inclusive) for the purpose of payment of final dividend & Annual General Meeting (AGM) of the company to be held on 11 July 2014.
Tata Sponge Iron surged by 20% upper limit at Rs 574 after consolidated net profit jumped 335.95% to Rs 40.50 crore on 11.91% growth in total income from operations to Rs 236.56 crore in Q4 March 2014 over Q4 March 2013. The Q4 result was announced before market hours today, 29 April 2014. Tata Sponge Iron's consolidated net profit rose 18.54% to Rs 101.19 crore on 1.7% decline in total income from operations to Rs 782.22 crore in the year ended 31 March 2014 (FY 2014) over the year ended 31 March 2013 (FY 2013).
Tata Sponge Iron's board of directors at its meeting held on Monday, 28 April 2014, recommended dividend of Rs 10 per share for FY 2014.
Hexaware Technologies tumbled 11.1% after consolidated net profit fell 31.89% to Rs 70.30 crore on 5.02% decline in income from operations to Rs 588.87 crore in Q1 March 2014 over Q4 December 2013. The Q1 result was announced during trading hours today, 29 April 2014.
Hexaware Technologies (Hexaware)'s consolidated EBITDA margin declined 330 basis points QoQ to Rs 19.2% in Q1 March 2014.
The company's cash & cash equivalents stood at Rs 443 crore as of 31 March 2014.
Hexaware added 11 new clients in Q1 March 2014. The company currently has 235 active clients.
P R Chandrasekar, CEO and Vice Chairman, Hexaware Technologies stated, "Though this quarter has been soft, we expect a healthy growth in revenue in Q2 2014 on the back of the visibility from our existing customers and our deal pipeline. To enable the company's future growth prospects, Hexaware has invested by adding 167 freshers offshore during the quarter. In addition, the company has further strengthened its field sales force by a gross addition of 14 personnel for sales and marketing activities".
Keeping with the growth focus, P R Chandrasekar added "We have engaged a leading onsulting firm to provide advisory on sharpening the 'Go to Market' strategy, conducting portfolio assessment of our micro-verticals and to institutionalize sales excellence processes. This initiative will drive the company on its long term growth path".
During the quarter, Hexaware said it experienced decline in revenue from some of its Top 10 customers. This was primarily due to some project closures as well as budget re-allocation to other initiatives on the client side, the company said. However, the relationships with all these customers continue to be strong and the company expects a healthy growth from the same set of clients in the coming quarters, Hexaware said in a statement. The company expects to register healthy revenue growth QoQ and an improvement in operating margin in Q2 June 2014, Hexaware said in a statement.
Hexaware Technologies' board of directors at its meeting held today, 29 April 2014, declared payment of interim dividend of Rs 3 per share for the year ending 31 December 2014.
Gujarat Gas Company rose 1.53% after the company was granted an extension of exclusivity for a block by PNGRB. Gujarat Gas Company after market hours on Monday, 28 April 2014 said that as per the relevant provisions of the PNGRB Act, 2006 and PNGRB (Exclusivity for City or Local Natural Gas Distribution Network) Regulations, 2008, the PNGRB has granted to the company, an extension of exclusivity for a block of ten years to lay, build and expand the CGD network in the authorised geographical area of Surat-Bharuch-Ankleshwar CGD network up to 31 March 2024.
Gujarat Gas Company had on 21 April 2014 announced that its board approved the amalgamation and arrangement between the company, Gujarat Gas Financial Services (GFSL), Gujarat Gas Trading Company (GTCL), GSPC Gas Company (GSPC Gas) and GSPC Distribution Networks (GDNI).
As per the scheme, the company, GFSL, GTCL, and GSPC Gas would be amalgamated with GDNL. All assets and liabilities of the company, GFSL, GTCL and GSPC Gas would be transferred to GDNL. The appointed date of the scheme would be 1 April 2013.
In consideration of the amalgamation, GDNL will allot 1 equity share for every 1 equity share of GGCL. Similarly, it will allot 1 equity share for every 1 equity share of GFSL.
GDNL will allot 81 equity shares for every 76 equity shares of GSPC Gas. GSPC Gas holds 44.45% of the total issued, subscribed and paid-up share capital of GDNL, which shall get extinguished.
The company holds 69.88% and 100% of the total issued, subscribed and paid-up share capital of GFSL and GTCL respectively. Since the company, GFSL and GTCL are the transferor companies, the shares held by the company in GFSL and GTCL shall get extinguished. Accordingly, no new shares of GDNL shall be issued in lieu of such shares getting extinguished, the company said.
Currently, GSPC Gas, GSPL and GSFC holds 44.45%, 38.89% and 16.66% paid up capital of GDNL respectively. Further, the existing Issued, Subscribed and Paid up Capital of GDNL will be reduced.
Dabur India lost 1.61% after consolidated net profit rose 17.3% to Rs 235.29 crore on 15.5% growth in net sales to Rs 1769.02 crore in Q4 March 2014 over Q4 March 2013. The Q4 result was announced during trading hours today, 29 April 2014.
Dabur India said that the topline in Q4 March 2014 was boosted by strong volume-led growth across key categories like Health Supplements, Digestives, Shampoos, Toothpastes, Foods & Home Care which helped the company to mitigate the impact of a challenging business environment and macro headwinds.
Commenting on the company's financial performance, Dabur India Chief Executive Officer Mr. Sunil Duggal said, "The business has performed well on all operating parameters. Our strong performance reflects the robustness of our business model and our ability to efficiently manage the emerging challenges. Dabur has been reporting strong and consistent performance despite intensifying competitive pressures and the challenging market environment being witnessed for some quarters now. Going forward too, our focus will be on pursuing an aggressive and profitable growth strategy".
Dabur India's consolidated net profit rose 19.7% to Rs 913.92 crore on 15.1% growth in net sales to Rs 7073.21 crore in the year ended 31 March 2014 (FY 2014) over the year ended 31 March 2013 (FY 2013).
Dabur's International Business continues to be a key growth driver, recording a robust 20% growth during Q4 March 2014, led by strong performance in GCC, Egypt and Levant (comprising Yemen, Jordan, Lebanon & Syria) markets. During the full year 2013-14, the Levant business reported a strong 32% growth, while sales in Egypt grew by 20% and GCC markets by 17%, Dabur India Group Director Mr. P D Narang said.
In the foreign exchange market, the rupee edged higher against the dollar. The partially convertible rupee was hovering at 60.375, compared with its close of 60.6450/65 on Monday, 28 April 2014.
The country will likely get below-normal levels of monsoon rain this year, the India Meteorological Department (IMD) said on Thursday, 24 April 2014. The IMD said that the rainfall during the June-September summer rainy season will likely be 95% of the long-term average for the country. India's weather department defines a normal monsoon as one with rainfall between 96% and 104% of the 50-year average, which is 89 centimeters this year. This year could be a below normal monsoon, the weather department said, as there is a 60% possibility of the emergence of the El Ni weather phenomenona warm weather system that starts in the southern Pacific can affect weather around the world. El Ni last affected India's monsoon in 2009 when the monsoon rainfall was 23% below normal.
Annual rains are important for India as most of its farmlands are dependent or rain for irrigation and more than half of its workforce is employed in agriculture. The monsoon rains usually arrive over the southern state of Kerala by the end of May or the first week of June, and gradually cover the entire country by July. The IMD will issue the update forecasts in June 2014 as a part of the second stage forecast. Along with the update forecast, separate forecasts for the monthly (July and August) rainfall over the country as a whole and seasonal (June-September) rainfall over the four geographical regions of India will also be issued.
The Reserve Bank of India (RBI) next undertakes monetary policy review on 3 June 2014. The RBI left its main lending rate viz. the repo rate unchanged at 8% after a monetary policy review on 1 April 2014, as consumer-price inflation eased to a two-year low and as the rupee firmed up against the dollar.
A major near term trigger for the stock market is the outcome of the upcoming Lok Sabha elections. The 36 days long voting process began on 7 April 2014 and will conclude on 12 May 2014. The results will be declared on 16 May 2014 after which India will get a new government. The term of the current Lok Sabha expires on 1 June and the new House has to be constituted by 31 May.
European shares were higher on Tuesday as a slew of corporate earnings helped to buoy sentiment ahead of a policy meeting by the US Federal Reserve. Key benchmark indices in UK, France and Germany were up by 0.05% to 0.64%.
UK economic growth accelerated in the first quarter amid signs that the recovery is broadening beyond consumer spending. Gross domestic product expanded 0.8% from the final three months of 2013, when it grew 0.7%, the Office for National Statistics said today in London.
Euro-area economic confidence unexpectedly fell in April, increasing pressure on the European Central Bank as it considers unprecedented steps to avert the risk of deflation. An index of executive and consumer sentiment decreased to 102 from a revised 102.5 in March, the European Commission in Brussels said today.
Most Asian stocks edged higher on Tuesday as investors weighed corporate earnings. Key benchmark indices in China, Indonesia, Taiwan and Hong Kong rose 0.02% to 1.45%. Key benchmark indices in South Korea and Singapore were off 0.15% to 0.23%. Japanese markets were closed for a holiday.
Trading in US index futures indicated that the Dow could gain 35 points at the opening bell on Tuesday, 29 April 2014. US stocks rose, with the Standard & Poor's 500 Index erasing an earlier slide on Monday, 28 April 2014,, as Internet and smaller companies pulled back from a selloff amid optimism over merger activity.
A report by the National Association of Realtors showed contracts to purchase previously owned US homes climbed in March by the most in almost three years, showing residential real estate was starting to stabilize entering the spring selling season. The pending home sales index rose 3.4%, the first gain in nine months, after a 0.5% drop in February that was smaller than initially reported.
A two-day meet of the Federal Open Market Committee (FOMC) on monetary policy review resumes today, 29 April 2014. The Federal Reserve on 19 March 2014 decided after the conclusion of a monetary policy review to trim its monthly bond purchases by $10 billion to $55 billion.
Investors are also watching developments in Ukraine. The Obama administration imposed sanctions on seven Russian officials and 17 companies linked to Russian President Vladimir Putin's inner circle involved in banking, energy and infrastructure. The sanctions, announced by the White House, are being imposed in conjunction with the European Union, which said it is adding 15 names to its list of previously sanctioned individuals.
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