A bout of volatility was witnessed as key benchmark indices trimmed gains in mid-morning trade after extending intraday gains in morning trade. At 11:15 IST, the barometer index, the S&P BSE Sensex was up 182.54 points or 0.75% at 24,520.97. The 50-unit Nifty 50 index was currently up 57.15 points or 0.77% at 7,461.15. The Sensex rose 267.57 points or 1.09% at the day's high of 24,606 in morning trade, its highest level since 2 February 2016. The barometer index rose 7.36 points or 0.03% at the day's low of 24,345.79 at the onset of the trading session. The Nifty rose 81 points or 1.09% at the day's high of 7,485 in morning trade, its highest level since 2 February 2016. The index rose 2.65 points or 0.03% at the day's low of 7,406.65 at the onset of the trading session.
The market breadth indicating the overall health of the market was strong. On BSE, 1,294 shares rose and 786 shares decline. A total of 100 shares were unchanged. The BSE Mid-Cap index was currently up 1.11%, outperforming the Sensex. The BSE Small-Cap index was currently up 0.63%, underperforming the Sensex.
In overseas stock markets, Asian stocks were trading mostly higher amid reduced expectations for further interest rate increases from the US Federal Reserve in this calendar year. But, Japanese stocks fell as the Japanese yen strengthened against the dollar. The Nikkei Stock Average was currently down 2.1%. US stocks registered modest gains yesterday, 4 February 2016, led by advances in the materials and industrials sectors.
Metal and mining edged higher on renewed buying. Jindal Steel & Power (up 7.4%), Vedanta (up 3.47%), Steel Authority of India (up 2.86%), Hindalco Industries (up 2.26%), NMDC (up 2.9%), National Aluminium Company (up 3.46%), Hindustan Zinc (up 2.08%), Hindustan Copper (up 1.76%) and JSW Steel (up 1.98%) gained.
Tata Steel edged lower in volatile trade after the company reported a reverse turnaround with a massive net loss in Q3 December 2015. The stock was currently off 0.73% at Rs 224.50. The stock hit a high of Rs 230.45 and a low of Rs 215 so far during the day. The company reported consolidated net loss of Rs 2127 crore in Q3 December 2015 compared with net profit of Rs 157 crore in Q3 December 2014. Turnover fell 16.63% to Rs 28039 crore in Q3 December 2015 over Q3 December 2014. Earnings before interest, taxation, depreciation and amortization (EBITDA) excluding one-offs and profit on sale of investments declined 69.96% to Rs 838 crore in Q3 December 2015 over Q3 December 2014. The result was announced after market hours yesterday, 4 February 2016.
T V Narendran, Managing Director of Tata Steel India and South East Asia said that steel markets in India have been affected by depressed international steel prices and predatory imports. The quarter saw a sharp decline in steel prices which has impacted the margins, Narendran said. Koushik Chatterjee, Group Executive Director (Finance and Corporate), Tata Steel said that the current business conditions for the global steel industry are extremely challenging with confluence of elevated imports across regions, currency headwinds and depressed market sentiments affecting Tata Steel Group's profitability. The Tata Steel Group has embarked on significant cost rationalisation program including fixed cost reduction, right sizing of manpower, productivity management and enriching the product mix across all geographies, Chatterjee said. These programs are expected to enhance the sustainable profitability profile of the company, he added. The company has also undertaken significant portfolio restructuring and will continue to pursue the same in the future, Chatterjee said.
Auto stocks edged higher. Ashok Leyland (up 2.63%), Tata Motors (up 2.19%), Hero MotoCorp (up 2.01%), Eicher Motors (up 1.9%), TVS Motor Company (up 1.42%) and Bajaj Auto (up 1.3%) edged higher. Maruti Suzuki India (down 1.03%) edged lower.
Mahindra & Mahindra (M&M) was unchanged at Rs 1,201.15. The stock hit a high of Rs 1,210 and a low of Rs 1,195.25 so far during the day. The company yesterday, 4 February 2016, announced the launch of its new heavy commercial truck series under the BLAZO brand at the Auto Expo at Greater NOIDA. The BLAZO series of heavy commercial vehicles include multi-axle trucks, tippers and tractor trailers in the range of 25 to 49 ton GVW for the domestic market.
Reliance Infrastructure (RInfra) rose 2.99% at Rs 422.10 after the company said it has sold its cement manufacturing subsidiary to Birla Corporation. Shares of Birla Corporation were off 1.15% at Rs 390.05. RInfra after market hours yesterday, 4 February 2016, announced the signing of share purchase agreement with Birla Corporation in relation to 100% sale of its subsidiary Reliance Cement Company (RCCPL). RCCPL has total cement capacity of 5.08 million tonnes per annum (mtpa) at its manufacturing units located at Maihar, Madhya Pradesh and Kundanganj, Uttar Pradesh and a grinding unit of 0.5 mtpa at Butibori, Maharashtra. Under this transaction, Birla Corporation will acquire the 100% shareholding of RInfra in RCCPL.
RInfra said the deal valued its cement business at Rs 4800 crore ($140 per tonne). The proceeds from the sale will be utilised for the group's debt reduction. The deal is EPS accretive for the company's shareholders, RInfra said.
RPP Infra Projects rose 2.32% at Rs 132.40 after the company said it has bagged an order worth Rs 112.20 crore in joint venture with Ramalingain Construction Company, from Karnataka Neeravari Nigam, a Government of Karnataka Enterprise, for modernisation of Gondi Main Canal and distributaries in Shimoga District of Karnataka. The current order book of the company stands at Rs 754.41 crore which is to be executed till financial year ending March 2018. The announcement was made during trading hours today, 5 February 2016.
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