Weekly Report Dec 31

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Weekly Report Dec 31 Powered By Docstoc
					  23rd Dec, 2009
January Roy 31, 2011
  Sutapa 2, 2010
Research Analyst
Sutapa Roy
   Sutapa Roy
  WEEKLY CHART OF SENSEX                                                            WEEK IN RETROSPECT
                                                                                   Indian stock market ended nearly 2 percent lower in the last
                                                                                   week of the calendar year 2011. Selling was witnessed in Bank
                                                                                   shares on rising worries over asset quality in a slowing econ-
                                                                                   omy and in Reliance Industries on concerns over lower gas
                                                                                   output from KG-D6 field. Weakening rupee also hurt the sen-

                                                                                   Continuing its downward trend, India’s Food Inflation eased
                                                                                   sharply to 0.42 percent during the week ended December 17,
                                                                                   2011 against 1.81 percent in the previous week on account of
                                                                                   fall in food prices and higher base of last year.

                                                                                   India’s Core Infrastructure growth rebounded in November
                                                                                   2011, posting an increase of 6.8 percent YoY against a revised
                                                                                   0.3 percent YoY in October 2011, on account of a revival in
                                                                                   cement, steel, coal and electricity production and also because
                                                                                   of the lower base of last year.
Indian stock market is likely to remain volatile. Nifty may trade be-
                                                                                   On the global front, the U.S. Initial Jobless Claims rose for the
tween 4,500 and 4,750. Stock specific movements are likely to be                   first time in a month in the week ended December 24, 2011,
witnessed on result anticipation for the Q3FY12 season. Shares of                  climbing by 15,000 to 381,000.
Auto and Cement will be in spotlight as companies from these two
sectors start unveiling monthly sales data for December 2011. India’s              Pending Sales of U.S. Existing Home increased 7.3 percent to
Exports-Imports data for November 2011 and PMI data for Decem-                     the highest level since April 2010 after climbing 10.4 percent
                                                                                   in the prior month.
ber 2011 will announce during the next week will be in focus. The
good thing for the overall market is that the food inflation has come              Japan’s Unemployment Rate remained unchanged in Novem-
down and the Reserve Bank of India (RBI) may start reducing inter-                 ber 2011 from the previous month at 4.5 percent.
est rates sooner rather than later. It would also be interesting to see
the RBI's action on the rupee front.                                               Japan’s Industrial Output dropped to a seasonally adjusted 2.6
                                                                                   percent in November 2011 from the previous month.


                                                                                                    Current      FY12       Current     FY12 EST
              NAME             LAST PRICE 5D % CH 1M % CH 3M % CH 1Y % CH                            P/E        EST P/E      P/B          P/B
 DOW JONES                        12217.56        0.39        1.65        11.95          5.53         12.62       12.53       2.59         2.51
 NASDAQ                           2605.15         0.22       (0.83)       7.86           (1.80)       22.32       15.75       2.63         2.50
 S&P 500                          1257.60         0.29        1.07        11.15          (0.00)       13.24       12.73       2.05         1.99
 FTSE 100                         5572.28         3.39        0.36        8.65           (5.55)       9.96        10.05       1.60         1.56
 CAC 40                           3159.81         2.87       (0.16)       5.96          (16.95)       9.25        9.22        1.08         1.02
 DAX                              5898.35         0.79       (3.00)       7.20          (14.69)       9.91        9.85        1.22         1.17
 NIKKEI 225                       8455.35         0.72       (2.18)       (2.82)        (17.34)       16.59       16.47       1.10         1.06
 HANG SENG                        18434.39        0.10       (3.18)       4.79          (19.97)       8.34        10.03       1.32         1.29
 STRAITS TIMES                    2646.35        (0.69)      (4.58)       (1.08)        (17.04)       6.46        12.56       1.27         1.25
 TAIWAN TAIEX                     7072.08        (0.54)      (0.96)       (2.12)        (21.18)       15.36       14.69       1.56         1.59
 KOSPI                            1825.74        (1.18)      (1.18)       3.17          (10.98)       18.30       9.81        1.07         1.17
 BRAZIL BOVESPA                   56754.08       (1.04)      (0.21)       8.47          (18.11)       9.20        10.01       1.27         1.16
 RUSSIAN RTS                      1380.49        (2.34)      (10.68)      2.94          (22.02)       5.01        4.92        0.89         0.81
 SHANGHAI SE COMPOSIT             2199.42        (0.24)      (6.83)       (6.77)        (21.68)       11.53       10.60       1.78         1.63
 BSE SENSEX                       15454.92       (1.80)      (8.26)       (6.07)        (24.64)       14.12       13.45       2.48         2.14
 NSE S&P CNX NIFTY                4624.30        (1.90)      (8.43)       (6.45)        (24.62)       13.59       13.19       2.30         2.03
MSCI INDICES                                                                           INDUSTRIAL METALS & ENERGY MARKETS
                                   LAST      5D%       1M%       3M%        1Y%                                  LAST         5D%       1M%        3M%          1Y%
             NAME                                                                                NAME
                                   PRICE      CH        CH        CH         CH                                  PRICE         CH        CH         CH           CH
MSCI WORLD                         1182.59   0.03      (0.43)     7.11      (7.62)     COPPER (USD/T)            7600.00       1.95     (3.61)      8.29       (19.96)
MSCI AC WORLD                      299.51    (0.13)    (0.97)     6.72      (9.42)     ALUMINUM (USD/T)          2020.00       1.30     (4.27)     (6.35)      (17.69)
MSCI AC ASIA PACIFIC               113.86    0.16      (3.23)     0.66      (17.31)    ZINC (USD/T)              1845.00       (0.32)   (10.91)    (0.81)      (23.41)
MSCI EM                            916.39    (1.22)    (4.63)     4.08      (20.41)    LEAD (USD/T)              2035.00       3.51     (3.55)      2.52       (19.15)
                                                                                       OIL (USD/BBL)              98.83        (0.70)   (1.52)     24.79        10.01
VOLATILITY INDICES                                                                     NATURAL GAS (USD/MMBTU)    2.99         (6.77)   (16.46)    (27.84)     (41.89)
                                   LAST      5D%       1M%       3M %       1Y%
                                   PRICE      CH        CH        CH         CH        PRECIOUS METALS
CBOE SPX VOLATILITY                 23.40    10.59     (14.97)   (45.53)    31.83
                                                                                                                 LAST         5D%       1M%        3M%          1Y%
INDIA NSE VOLATILITY                27.11    (1.02)    13.01     (15.12)    63.71                                PRICE         CH        CH         CH           CH
                                                                                       GOLD (USD/OZ)             1563.70       (2.66)   (10.46)    (3.71)       11.32
10 YERS BOND MARKETS                                                                   SILVER (USD/OZ)            27.84        (4.39)   (15.09)    (6.97)       (8.54)
                                          5D%          1M %      3M%        1Y%
              NAME                  YIELD
                                           CH           CH        CH         CH        INDUSTRY INDICES
US Generic Govt 10 Year Yield         1.88   (7.32)    (9.27)    (2.05)     (44.24)
                                                                                                                 LAST         5D%       1M%        3M%          1Y%
UK Govt Bonds 10 Year Note Gen        1.98   (2.99)    (14.49)   (18.64)    (43.09)                              PRICE         CH        CH         CH           CH
                                                                                       BALTIC DRY INDEX                        (2.74)   (5.85)     (8.48)
Brazil Government Generic Bond        3.97   (0.58)    (0.43)    (12.70)    (6.72)
                                                                                       BBG WORLD IRON INDEX      197.13        (0.38)   (6.57)     (1.42)      (36.81)
Japan Govt Bond Year to maturity      0.99    1.02     (7.84)    (4.26)     (12.41)

Australia Govt Bonds Generic M        3.67   (1.85)    (6.71)    (13.08)    (34.71)    AGRO MARKET
India Govt Bond Generic Bid Yi        8.57    2.50     (1.99)     1.65       7.95                                LAST         5D%       1M%        3M%          1Y%
                                                                                                                 PRICE         CH        CH         CH           CH
                                                                                       COFFEE (USD/IB)           226.85        2.46     (4.24)     (2.24)        2.14
                                                                                       COTTON (USD/IB)            91.80        5.23      0.98      (5.77)       (1.40)
                                   LAST      5D%        1M%       3M%        1Y%
                                   PRICE      CH         CH        CH         CH       SUGAR (USD/IB)             23.30        (0.60)   (1.65)     (7.87)        4.11
DOLLAR INDEX SPOT                   80.18     0.27       2.29      2.07       0.83     WHEAT (USD/BU)            652.75        4.99      6.31       0.97       (23.99)
EUR-USD X-RATE                      1.30      (0.64)    (3.61)    (3.18)     (2.48)    SOYBEAN (USD/BU)          1207.75       3.07      5.85       0.79        (6.14)
USD-GBP X-RATE                      0.64      0.31       1.05      0.28      (0.74)

USD-BRL X-RATE                      1.87      (0.58)    (1.15)    (1.42)     (10.07)   INSTITUTIONAL FLOW IN C R (26/12-30/12)
USD-JPY X-RATE                      76.91     1.53       0.92      0.20       6.01           INSTRUMENT            PURCHASE              SALE                NET
USD- X-RATE                         53.07     (0.20)    (1.61)    (7.71)     (15.26)   FII (P)                           5291.70        5399.65             (107.95)

USD-CNY X-RATE                      6.29      0.68       1.34      1.37       4.96     DII                               3315.84        3036.93              278.91

USD-KRW X-RATE                     1152.45    (0.20)    (0.86)     2.23      (1.53)    MF (26/12-29/12)                   979.20         803.10              176.10

MONEY MARKETS                                                                          FII DERIVATIVE SEGMENT IN C R (26/12-30/12)
                                   LAST      5D%        1M%       3M%        1Y%             INSTRUMENT            PURCHASE             SALE                 NET
                                   PRICE      CH         CH        CH         CH       INDEX FUTURE                  12915.17           12358.76             556.41
BBA LIBOR USD 3M                    0.58      0.91       9.85     55.21       91.87    INDEX OPTION                  78977.12           77705.56            1271.56
MIBOR Offer Market 3M               1.36     (2.86)     (7.48)    (12.26)     34.65    STOCK FUTURE                  18616.35           18833.28            (216.93)

India Indicative Call Rate          8.90      4.71       4.09      7.23       61.82    STOCK OPTION                      1252.21        1225.91              26.30

Data Source: Bloomberg, BSE, NSE
BANKING & FINANCIAL                                                       INFRASTRUCTURE
As part of the strategy to infuse liquidity in the system, the Reserve    Singapore's Changi Airports is likely to buy a 26 percent stake in
Bank on Thursday bought bonds worth INR8,109.48 crore under               GVK's airports business, forming a crucial partnership just before
open market operations (OMO), much lower than the INR12,000-              bids are to be called for building a spanking new airport to cater
crore target. While the government security (G-Sec) maturing in           to Mumbai's booming traffic. Changi Airports International, a
2018, with a coupon rate of 7.83 per cent, garnered over                  wholly owned subsidiary of Changi Airport Group, is likely to pay
INR5,234.89 crore, the 7.80 percent G-Sec maturing in 2021 gar-           GVK Airport Holdings Private Limited INR2,000-2,200 crore for
nered INR2,874.58 crore.                                                  the 26 percent stake, valuing the Hyderabad-based company's
                                                                          airport assets at 8,000 crore.
The Reserve Bank of India (RBI), deregulated interest rate on sav-
ings accounts in all state and central co-operative banks on Decem-       NTPC commissioned yet another Super Critical Unit 2 of 660 MW
ber 26, 2011. The apex bank had freed these rates for the scheduled       of NTPC-Sipat Super Thermal Power Project situated in Chhattis-
commercial banks in October. Like commercial banks now Co-                garh, taking its total installed capacity to 36,014 MW. This is the
operative banks are free to determine their savings bank deposit          second unit of NTPC as well as Sipat to be commissioned with
interest rate subject to two conditions. Under the first condition,       super critical thermal power technology. Super critical power sta-
Each bank will have to offer a uniform interest rate on savings           tions are eco-friendly, run on high efficiency and consume less
bank deposits up to INR1 lakh, irrespective of the amount in the          coal compared to traditional coal-fired units. currently has 15 coal
account within this limit. The other condition states that for sav-       -based, seven gas-based and six joint venture power stations and
ings bank deposits over INR1 lakh, a bank may provide differential        plans to be 1,28,000 MW power company by 2032.
rates of interest, if it so chooses. Till now, co-operative banks were
mandated to give 4 percent interest rates on such deposits. The rate      Engineering, procurement and construction (EPC) conglomerate
was increased from 3.5 percent. This move of RBI could have the           Punj Lloyd has bagged a project worth INR1,050 crore from GMR
positive impact on the cooperative banks for the mobilization of          Projects Private Ltd. Punj Lloyd will undertake the design, engi-
fund, as the banks are suffering from liquidity crunch, but the Net       neering, procurement and construction of 124 km of the six-lane
Interest Margin (NIM) is also the matter of concern.                      Chittorgarh bypass to Udaipur (Rajasthan). it had got the letter of
                                                                          intent from GMR for the project that is scheduled for commis-
Banks and financial institutions may get tax benefits on profits          sioning in 36 months and has got it on a turnkey fixed EPC price
made through activities leading to financial inclusion. Further, any      basis. With this contract, the order backlog for the Punj Lloyd
losses these institutions incur, as a result, may also be allowed to be   Group on a consolidated basis has gone up to INR28,725 crore,
carried over for a longer period. At present under Section 72 of the      reflecting the total value of unexecuted orders on September 30.
Income Tax Act, 1961, losses from any non-speculative business
activity are allowed to be carried over for up to eight subsequent        Promoters of Lanco Infratech have informed the exchanges that
assessment years.                                                         they have pledged additional shares by creation of encumbrance
                                                                          in favour of ICICI Bank and Infrastructure Development Finance
Union Bank of India has reduced its base rate by 10 basis points to       Company Ltd (IDFC). Lanco Group Ltd, who hold about 56 per
10.65 percent from 10.75 percent, with immediate effect. This will        cent equity in Lanco Infratech, have announced that they have
lead to reduction in rates of all loans linked to the base rate.          pledged about 15.8 percent stake in ICICI Bank and another 15.12
                                                                          percent in IDFC by creation of encumbrance.
ICICI Bank increased its one-year NRE term deposit rate from 3.82
percent to 6.50 percent. Customers investing over INR15 lakh and          Bonds floated by the NHAI, sold like hot cakes on the first day
up to INR50 lakh get another 0.50 percent. Those investing over           with demand outstripping the offer within hours of opening, be-
INR50 lakh and up to INR1 crore get 8.25 percent. Other top banks         lying perception that people are averse to investing in infrastruc-
such as SBI and HDFC Bank have increased their NRE term deposit           ture, which is getting a short shrift from the government. The
rates of the same tenor to between 9 percent and 9.25 percent.            success of the first retail bond sale by the nation's roads builder is
                                                                          due to the attractive post-tax returns from its bonds for as long as
The life insurance industry recorded a premium income of                  15 years, when interest rates are poised to fall. Sovereign backing
INR2,91,605 crore during 2010-11 against INR2,65,447 crore in the         to the entity is another comforting factor for investors since their
previous financial year, registering a growth of 9.85 percent. Out of     capital would be returned even if some of the projects funded turn
the 23 life insurers in operations during 2010-11, twelve companies       unviable, or even if NHAI incurs losses.
reported profits. The companies include Life Insurance Corporation
(LIC), ICICI Prudential, Birla Sunlife, Max New York, Bajaj Al-           Fitch Ratings has affirmed India-based IRB Infrastructure Devel-
lianz, SBI, Kotak Mahindra, TATA AIG, MetLife, Aviva, Sahara              opers Ltd's (IRB) National Long-Term rating at 'Fitch A-(ind)'
India and Shriram.                                                        with a Stable Outlook.
 The Government will shortly write to Sterlite, a Vedanta Group company, asking it to submit a formal plan to buy the remaining Gov-
   ernment stake in Balco. The Government went for a strategic sale of Balco`s equity to Sterlite in 2001. An Empowered Group of Minis-
   ters, in its meeting on November 30, discussed various options in response to the Vedanta Group`s Chairman, Anil Agarwal`s, letter to
   the Prime Minister on July 4. It was decided to respond by asking for a formal proposal, according to news report. Sterlite holds 51 per-
   cent in Balco while the remaining 49 percent is with the Government.

 The Chairman of Gas Authority of India, B.C. Tripathi, has said that GAIL shall take active steps to establish RLNG (re-gasified lique-
   fied natural gas) terminal in the Krishna-Godavari Basin. Tripathi, who called on the Andhra Pradesh Chief Minister, N. Kiran Kumar
   Reddy, at Secretariat on Friday outlined GAIL plans. According to a statement from the Chief Minister`s Office, initially a floating ter-
   minal is planned to be set up. After its success, a land- based terminal will be set up in the State through the Andhra Pradesh Gas Dis-
   tribution Corporation.

 Glenmark Pharmaceuticals has obtained the DCGI (India) approval to conduct the pivotal study of ``Crofelemer`` in Acute Watery
   Diarrhoea patients. Post approval from the DCGI, dosing in patients has also commenced. This is a randomized, double blinded, pla-
   cebo controlled, parallel Group, three arm, multicenter and multinational pivotal study that is being carried out to assess the Efficacy
   and Safety of two dosage regimens of Crofelemer Tablets in the Treatment of Moderate to Severe Acute Watery Diarrhoea in Adult
   Patients including cholera. This Phase III study will be done at leading centres in India and Bangladesh.

 Havells India is entering into a Joint Venture (JV) with Shanghai Yaming Lighting, a company based at the people`s republic of China.
   The 50:50 JV would leverage upon the technology and manufacturing strengths of its partners, providing energy and cost efficient
   products for Global Sylvania and local Chinese markets.

 Varun Group, which holds exploration rights for onshore oil at Madagascar covering an area of about 6884 sq. km., has entered into
   joint venture co-operation agreement with Sure King Varun Hong Kong (SKVHL) as SPV formed at Hong Kong between Varun Group
   and Da Qing Oil Field Company, one of the leading oil companies in China. Under the agreement Varun group has agreed to cede 51
   percent of its stake in the oil field to Da Qing Group of china through the above SPV.

 The Board Members of Bharati Shipyard met to consider the reference made to the Corporate Debt Restructuring (CDR) cell in its case.
   The Board has noted and discussed the proposal for restructuring of Term/Working Capital Debt of INR28.54 billion out of a total debt
   of INR32.5 billion. Currently, the company has robust order book visibility worth Rs 68 billion to be executed by 2014 and is in ad-
   vance stages of completion of its two greenfield shipyards at Dabhol and Mangalore. The floating dock facilities and the equipments
   that were bought from the famous British Shipyard, Swan Hunter are in advanced stages of commissioning. This will enhance the pro-
   duction capacity, which will be used to execute large orders going forward.

 Godrej Properties enters into private equity agreement with SUN-Apollo India Real Estate Fund, LLC acting through its affiliates/
   companies (SUN-Apollo). The real estate developer sells 49 percent equity stake in a subsidiary developing its project at Sector 104 in
   Gurgaon. Godrej Properties (GPL) the real estate development arm of the Godrej. Group, has announced an agreement with SUN-
   Apollo. Through this agreement, GPL has sold 49 percent equity stake in its subsidiary, Godrej Premium Builders Private Limited
   (GPBPL). SUN-Apollo has invested INR450 million out of which INR18.3 has been paid to GPL for sale of stake and
   INR267 million has been invested in GPBPL.

 Zuari Industries will be setting up a joint venture company in Singapore with Mitsubishi Corporation, Japan for the purpose of invest-
   ments in rock phosphate assets. The company will have a 30 percent stake in the joint venture. An investments by way of equity of
   upto USD20 million by the company in the joint venture has been approved.

 Balaji Telefilms entered into binding business transfer agreements to sell its media education business and its mobile content produc-
   tion business for a consolidated consideration of INR83.7 million. The transaction would be effective on receipt of the full considera-
   tion within a period not exceeding 90 days.

 Stone India signed an agreement with Turbo Power System, UK, a leading Permanent Magnet based rotating machine designer and
   manufacturer. The agreement will permit joint development of sophisticated self-propelled permanent magnet based coach power gen-
   eration system for high speed coaches of Indian Railways.

   January 02, 2012                                                  January 05, 2012
  India’s Exports – Imports data for November 2011.           India’s Weekly Food and Fuel Inflation data for the week
                                                                  ended December 24, 2011.
  India and Germany PMI Manufacturing data for December
    2011.                                                          The U.S. Initial Jobless Claims data for the week ended De-
                                                                    cember 31, 2011.

                                                                The U.S. Bloomberg Consumer Comfort data for the week
     January 03, 2012                                             ended January 01, 2012.
  The U.S. ISM Manufacturing data for December 2011.
                                                                Germany Retail Sales data for November 2011.
  The U.S. Construction Spending data for November 2011.

  Germany Unemployment Rate data for December 2011.
                                                                     January 06, 2012
  The U.K. PMI Manufacturing data for December 2011.
                                                                The U.S. Unemployment Rate data for December 2011.

                                                                Germany Factory Orders data for November 2011.
     January 04, 2012
 India and Germany PMI Services data for December 2011.

 Minutes of the U.S. FOMC Meeting.

 The U.S. MBA Mortgage Application data for the week ended
   December 30, 2011.

 The U.S. Factory Orders data for November 2011.
The investments discussed or recommended in this report may not be suitable for all investors. Investors should use this research as one input into formulating 
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