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25 January 2010

Results: SBI, LIC hsg, Hero Honda etc

SBI Q3 cons net profit down 8.4% at Rs 3,304.59 cr

India's largest bank, State Bank of India (SBI) has announced its third quarter results of FY10. The bank has reported 8.4% decline in its consolidated net profit of Rs 3,304.59 crore as against Rs 3,607.61 crore in the same quarter of previous year.

Consolidated net interest income increased 9.08% to Rs 8,781.7 crore from Rs 8,050.8 on year-on-year basis (YoY).

Its standalone net profit was flat at Rs 2,479.05 crore as against Rs 2,478.42 crore and net interest income went up 9.69% to Rs 6,316.3 crore from Rs 5,758.25 crore. CNBC-TV18 poll saw the net interest income at Rs 6,075.33 crore and net profit at Rs 2,556.15 crore.

Other income of the SBI increased to Rs 3,365.71 crore from Rs 3225.6 crore and provisions went up to Rs 856.61 crore versus Rs 196.83 crore.

Net non performing assets (NPAs) were up 64.2% to Rs 11,270 crore and provision cover was at 40.24% versus 42.86% in Q2.

SBI said, in a press conference, treasury income was down by Rs 234 crore since last year. Loan growth came in at 19% (YoY) and net interest margin was at 2.83%.

Net NPAs stood at 1.88% and provision coverage ratio at 56%. The bank has provided Rs 440 crore as additional provision. Deposit growth was at 11% (YoY).

Hero Honda Q3 net profit up 78.4% at Rs 535.8 cr

India's largest two-wheeler maker, Hero Honda has announced its third quarter results of FY10. It has reported net profit of Rs 535.8 crore, an increase of 78.4% over Rs 300.4 crore in the same quarter of previous year.

Net sales jumped 32.72% to Rs 3,814.4 crore from Rs 2,874 crore (YoY). EBITDA (earning before interest, tax, depreciation and amortisation) margin stood at 17.27%.

The numbers were better-than-expectations, as CNBC-TV18 poll saw the net profit at Rs 509 crore and net sales at Rs 3,783 crore.

In a press conference, Hero Honda said its bike market share in India was over 59%. On the outlook, it said the market demand would remain bullish but rising input costs remained a concern, as commodity prices are on 'Upward Trajectory'.

The company will look at hiking capacity at existing units and may look at setting up new plant in near future.

The share closed at Rs 1,618.00, down Rs 24.25, or 1.48%. Its market cap stood at Rs 32,309.44 crore at current market price.

India to grow at 9.2% in FY-11: CMIE

India to grow at 9.2% in FY-11: CMIE

MUMBAI: India's economic growth is likely to return to pre-crisis levels in the next fiscal year, driven by strong industrial and agriculture

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growth, a recent review by a think tank showed.

The Centre for Monitoring Indian Economy (CMIE) expects the Asia's third largest economy's GDP growth to accelerate to 9.2 percent in 2010/11 from 6.9 percent in 2009/10.

"In fiscal 2010/11, real GDP growth will be propelled by a strong performance by the industrial sector and a robust recovery in agricultural and elite sector. Services sector too is expected to do well," CMIE said in the report.

"A revival in consumer confidence and investment activities will supplement growth in the commodities segment," it added. India's GDP growth slowed to 6.7 percent in 2008/09 from 9 percent or more in the previous three years as the effect of global financial turmoil hurt demand, prompting the authorities to unveil a spate of measures designed to boost the economy.

The measures helped as the country's industrial output grew at its fastest pace in two years in November at 11.7 percent, the economy expanded 7.9 percent in the September-quarter and inflation jumped to a one-year high of 7.3 percent in December CMIE expects the wholesale price index, the main price barometer, to steadily fall to 7.7 percent in the June quarter and further to 3.8 percent March quarter of 2011.

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The drop in inflation which is seen across primary articles, fuel and manufactured products, is likely to be because of the high base value in 2009/10 and a good kharif (summer) crop production in 2010, it said. Headline inflation is estimated at 8.6 percent in March quarter, CMIE said.

****************************************
NMDC board approves divesting 8.38% stake

	Nifty: Resistance at 5123-5163-5200 Fair Wealth
	Sensex likely to move lower in the coming weeks Nirav Vakharia
	Thangamayil Jewellery IPO: Subscribe Hem Securities
	Market expected to remain volatile ahead of F&O expiry Jainam Research

Src: ET, Valuenotes

Downside breakout could test 4,800

Outlook: The short term trend is bearish and the Nifty is likely to test 4,950 again at the very least. If it falls below 4,950, it could hit 4,800. Expect high daily volatility and high volumes as well since this is settlement week. The daily range could be 150 points.

Rationale: The market made a decisive downside breakout when it closed below 5,150 on Thursday – the breakout was confirmed by volume expansion. That drop set up a likely target of 4,950, which was fulfilled intra-day on Friday. If support at 4,950 is broken, the next reliable support is 4,800. If the market falls below 4800, an intermediate trend reversal would be confirmed.

Counter-view: In terms of time, an intermediate uptrend has been in force since end-November. A trend reversal would be quite likely and in that case, the market could dip till it hits support in the range of 4,750-4,700. The other possibility is that short-covering close to settlement could trigger a sharp recovery that pulls the market back above 5,180. That would be a positive signal but it would need to be backed by breadth (positive advance-decline lines) and strong volume action to make it valid.

Bulls & bears: This is results season so action will always be somewhat stock-specific. Reliance and Airtel did well on good results while L&T saw selling after it posted poor results. In fact, most major sectors saw heavy selling. The CNXIT lost a lot of ground despite the weaker rupee – Tech Mahindra was the only remotely bullish stock by Friday’s close. TCS, Wipro and Infosys were all looking weak.

Financials were also down with the Bank Nifty losing somewhat less than the market but most bank stocks closed bearish. Pressure on bank stocks could intensify next week. Metals, real estate and engineering-construction counters were sold heavily. If a quick recovery occurs in these sectors, it will be due to a combination of short covering and carryover buying. FMCG companies such as ITC and HUL saw some defensive buying. Some PSUs like REC and Concor could also see speculative buying in the hope of an IPO or FPO. A couple of auto and auto ancillary stocks could also move against the overall trend.

MICRO TECHNICALS

Hindustan Unilever
Current Price: Rs 257.95
Target Price: Rs 270

The stock is resting on good support between Rs 250-257. It has the potential to climb till Rs 266-270 at least since it’s perceived as a good defensive holding during bearish phases. Keep a stop at Rs 252 and go long. Start booking profits above Rs 266.

Reliance Industries
Current Price: Rs 1,053
Target Price: Rs 950

The stock is very delicately poised at support between Rs 1,030-1,050. If it closes below Rs 1,030, it could drop till around the Rs 950 level. Keep a stop at Rs 1,070 and go short. Increase the position between Rs 1,030. Book profits below Rs 970.

Unitech
Current Price: Rs 79.35
Target Price: Rs 72

The stock has been testing support between Rs 77-80. If it closes below Rs 77, it is likely to drop till around Rs 72. Keep a stop at Rs 82 and go short. Increase the position below Rs 77. Start booking profits at around Rs 73-74.

Shree Renuka
Current Price: Rs 220.95
Target Price: NA

The stock is consolidating close to a recent low. If the support between Rs 215-220 holds, it has the potential to recover till around the Rs 240 levels. Keep a stop at Rs 215 and go long. Book partial profits at Rs 230 and clear the position at Rs 240.

Punj Lloyd
Current Price: Rs 186.10
Target Price: Rs 170

The stock has made a downside breakout on high volumes. It’s likely to fall till the Rs 179 level at least and it may slide till around Rs 170. Keep a stop at Rs 190 and go long. Book partial profits at Rs 179 and revise the stop to Rs 180.

(The target price and projected movements given above are in terms of the next five trading sessions unless otherwise stated.

Sustainable recovery	25-JAN-10
The superlative December quarter results from the Big Three IT companies renewed hopes that the worst is over for the IT sector.

Many delivery hurdles to cross	25-JAN-10
While the scope for third-party logistics is robust, maintaining its margins will be a tough act for Aqua Logistics.

Regional focus	25-JAN-10
While Vascon Engineers’ EPC capabilities provide comfort, success in the real estate business will depend on the company’s ability to scale it up.

Expanding MF reach	25-JAN-10
The industry has been abuzz with news of mutual funds being available through stock exchanges for transacting.

Disappointing show	25-JAN-10
While L&T’s December quarter results and cut in its 2009-10 guidance are disappointing, most analysts believe it to be a blip.

'2010 may not favour top down investing'	25-JAN-10
In the second series of interviews, Phani Sekhar talks about the markets in 2010, the sectors to bet on and his portfolio.

Markets at a glance	25-JAN-10
A sell-off in global stocks and disappointing earnings numbers from a few big corporates pulled down the key indices during four out of five trading sessions in the week.

Analysts' corner	25-JAN-10
ONGC’s Q3 FY10 revenues were up 23.1 per cent y-o-y to Rs 15,310 crore on account of higher crude prices and realisations on value added products, and lower subsidy.

Down move on high volumes, volatility	25-JAN-10
A downside breakout with only three sessions left for the settlement has left the market in turmoil.

Downside breakout could test 4,800	25-JAN-10
The market crashed in the last two sessions with the Nifty bouncing from 4,955 level to close at 5,036 points for a week-on-week loss of 4.12 per cent.

Not shining through	25-JAN-10
Small size and limited presence reduce the appeal of Thangamayil Jewellery’s IPO.

Still in the trial phase	25-JAN-10
While Syncom Healthcare has big plans to expand, it is a high risk bet considering its short track record and inexperience in overseas markets.

Analysts Picks: TCS, JSW Steel, IVRCL Infra, Maruti Suzuki

Market volatility may spike ahead of top results, RBI policy

Heard on the Street

Src: ET, Business-Standard

Discover Stock Market India Nifty Bank Nifty Technicals Analysis & India Business Stories

25 January 2010

Results: SBI, LIC hsg, Hero Honda etc

India to grow at 9.2% in FY-11: CMIE

Downside breakout could test 4,800

Zoho One

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