Headlines (23 October 2008)

GENERAL

1)India’s Polar Satelite Launch Vehicle (PSLV-C11) on Wednesday morning successfully put Chandrayaan-1 into its initial orbit, marking the spacecraft’s long journey to the Moon. This is the first time India is sending a spacecraft to the Moon, 3.84 lakh km away. India is the sixth country to do so, after Russia, the U.S, the European Space Agency, Japan and China. It will be three weeks before Chandrayaan-1 reaches its final destination of 100-km orbit around the moon.

Hindu

CORPORATE / INDUSTRY

2)PMP Components, the auto-component company of the Ashok Piramal Group, has announced the acquisition of Czech Republic-based PAL International for an undisclosed amount. PAL International, which is the third largest wiping systems manufacturing company in Europe was earlier owned by the Canadian auto group, Magna International.

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MONEY & BANKING

3)THE rupee plummeted to an all-time low of 49.5 against the dollar on Wednesday, as foreign portfolio investors continued their selling spree on the stock exchanges. Heavy intervention by the central bank was of little help, as the rupee ended the day at a record closing of 49.28/29 against the dollar, weakening from Tuesday’s close of 49.04/06.

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4)The government is likely to infuse Rs 3,000 crore into seven public sector banks to shore up their capital adequacy ratio to 12 per cent to improve market confidence in the banking sector. The banks likely to benefit from the capitalisation programme include Central Bank of India, Vijaya Bank, Bank of Maharashtra, UCO Bank and Indian Overseas Bank, Allahabad Bank and United Bank. All these banks have a capital-to-risk-assets ratio(CRAR) of below 12 per cent.

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5)Bank of India reported an 80 per cent growth in second quarter net profit, beating analysts’ predictions. Mr T.S. Narayanasami, Chairman and Managing Director, attributed the better-than-expected results to robust credit growth and healthy recovery of written off assets. The bank’s net profit increased to Rs 763 crore from Rs 425 crore in the year-ago period.

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MARKETS

6)Key equity indices snapped their two-day gains and ended in the negative terrain on Wednesday. Intense selling pressure, coupled with weak global cues and sustained selling by foreign funds, forced the market to remain under pressure throughout the day. The 30-share Sensex of the Bombay Stock Exchange(BSE) plunged by 513.49 points, or 4.81%, and closed the day at 10,169.90 points. Earlier in the day, the Sensex opened with a negative gap and touched an intra-day high of 10,484.45 points and fell to a low of 10,128.22 points. The broader Nifty of the National Stock Exchange (NSE) also lost 169.75 points or 5.25%, ending at 3,065.15 points.

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7)Even as emerging markets are witnessing a massive capital outflow in the wake of the global credit crisis, foreign institutional investors (FIIs) have increased their stake in as many as eight companies in the 30-share Sensex. The major companies, in which the FII share went up from June 30 to September 30 this calendar year, include heavyweights such as HDFC, Hindalco Industries, Maruti Suzuki, BHEL and Larsen & Toubro. Analysts said the strong fundamentals of these companies continue to attract FII interest.

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8)Power Exchange India, promoted by the National Stock Exchange(NSE) and National Commodity and Derivatives Exchange(NCDEX), started operations today. The exchange received bids for 6300 MWH of power today and the matched power was cleared at the market prices between Rs 7.6/KWH and Rs 9.8/KWH.

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9)Nine out of the past 10 Diwalis saw Indian stocks rise after the festival. But with new and international factors at play, would this decade-long trend prevail this year as well? Fidelity Funds Network has analysed the performance of domestic stocks over the last 10 years, comparing them for the 30 days preceding and 30 days following Diwali. The analysis showed that the Indian indices did comparatively better after Diwali than before, said a release from Fidelity.

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10)With the rupee touching a new low on Wednesday, volumes in currency futures trading on the bourses hit new highs. A total of 2.06 lakh contracts were traded on the NSE on Wednesday, which is the highest number traded since the day currency futures commenced, on August 29. The total turnover on NSE amounted to Rs 1,026 crore.

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11)The Securities and Exchange Board of India(Sebi) has modified the earlier circular it had issued asking stockbrokers/clearing members to carry out complete internal audit on half-yearly basis. Now, the audit can be carried out by chartered accountants, company secretaries or cost and management accountants who are practising and do not have any conflict of interest. Earlier, Sebi had specifically stated that the half-yearly audit could be carried out only by independent qualified chartered accountants.

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IPO

12)THE government is likely to launch the proposed initial public offers(IPOs) and follow-on public offers(FPOs) of public sector companies only after the stock market conditions improve. It was expected that Oil India (OIL) and National Hydroelectric Power Company(NHPC) would be listed during the current fiscal, and discussions were on for floating IPOs of several other PSUs.

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MUTUAL FUNDS

13)ABN Amro Mutual Fund has extended the initial offer period for its bond fund until Monday, the fund house said in a notice today. ABN Amro Bond Fund, an open-ended debt scheme launched Sep 29, was slated to close initial subscription today.

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COMMODITIES

14)Tracking weakening global trend, gold prices dropped further by Rs 300 to 12,450 per 10 gram on the bullion market in New Delhi on heavy selling by stockists amid restricted buying. Standard gold and ornaments remained under selling pressure and plunged further by Rs 300 each to 12,450 and Rs 12,300 per 10 grams respectively. The metal fell Rs 210 in previous day’s trading.

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REAL ESTATE

15)Real estate major DLF has emerged as the sole bidder for the commercial development on 45,371 sq.metres of railway land in Mumbai’s Western Express highway at Bandra-east. Rail Land Development Authority(RLDA), which is executing the project, is likely to technically evaluate the project before taking a call on the next course of action, said sources in the know. Wednesday was the last day to accept the bid. Real estate firms including Akriti, DLF, Emaar-MGF, Tata Realty and Infrastructure and a subsidiary of Reliance ADAG had attended the recently held pre-bid meeting.

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16)Given the current global economy slowdown and its impact on the Indian economy, real estate developers have hit upon novel marketing strategies to woo reluctant flat buyers. Real estate players such as Mantri Synergy, Jains Sunderbans, ETA Rosedale and Hirco Palace Gardens have come out with new schemes to attract buyers. In what is seen as a clear move to shore up the ‘sagging morale’ of prospective buyers, property developers have now come forward to pay pre-EMI(equated monthly instalment) interest on part-money disbursed on the housing loan taken by a flat buyer. “Given the current situation, builders are taking a conscious decision to bear the interest burden of the consumer,” Prakash Challa, President, Confederation of Real Estate Developers Association of India (CREDAI).

Hindu

INFORMATION TECHNOLOGY

17)The country’s top IT firm TCS today said its net profit grew to Rs 1,270.99 crore in the quarter ended September 30 from Rs 1,251.60 crore in the year-ago period. Total income rose to Rs 6,784.45 crore in the second quarter of this financial year on a consolidated basis, nearly 18 per cent up from Rs 5,761.82 crore in the July-September quarter of last year, Tata Consultancy Services said.

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18)Wipro, the soaps to software major, riding on operational efficiencies has reported a 19 per cent increase in its net profit to Rs 978 crore for second quarter of the current fiscal as compared to the corresponding period last year. Revenues were up 36 per cent to Rs 6,507 crore. However, the guidance of its flagship IT services business, Wipro Technologies, indicates it will crawl by hardly a per cent during the third quarter, indicating tought times.

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19)Inspite of a slowdown in the US, TCS has said that it is on course to meeting its annual hiring target of 30,000 to 35,000. The Tata group company is ahead of its hiring target for the half year ended September 2008 as it added 18,664 in that period, according to Mr Ajoy Mukherjee, Vice-President, Head, Global Human resources.

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INTERNATIONAL

20)OIL prices fell below $69 a barrel Wednesday as investors shrugged off a looming OPEC production cut after company forecasts suggested the US may be headed for a severe economic slowdown that would crimp demand for crude. Light, sweet crude for December delivery dropped $3.37 to $68.81 a barrel in electronic trading on the New York mercantile exchange by mid-afternoon in Europe.

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21)THE world’s worst financial crisis in 80 years hammered emerging markets on Wednesday, prompting emergency central bank moves and call for international help to curb investor flight. Emerging market stocks, sovereign debt and currencies all came under intense pressure as investors unwound funding positions amid worries about the deteriorating world economy. That overshadowed signs that efforts to bolster the financial system were beginning to bear fruit.

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Business Standard www.business-standard.com
The Times of India www.timesofindia.com
The Hindu www.hindu.com
Deccan Chronicle www.deccan.com
The New Indian Express www.newindpress.com

Headlines (21 October 2008)

GENERAL

1)India and Russia on Monday agreed to further cooperation in the nuclear sector during Russian President Dmitry Medvedev’s maiden visit to the country in December. The Foreign Ministers of both countries also signed a protocol outlining consultations between diplomats over the next year.

Hindu

ECONOMY

2)Prime Minister Manmohan Singh emphatically told the nation there was no place for fear because of global financial uncertainty, and assured bank depositors their savings were “entirely safe”. He spelt out the government’s stance on the liquidity crisis, offering a frank assessment that growth would slow down “temporarily”, but that inflation would also come down.

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3)The Finance Minister, Mr P Chidambaram, on Monday said that the Indian economy is expected to grow close to 8 per cent in fiscal 2008-09 despite the global financial turmoil. “Despite, the global slowdown, we hope that the Indian economy would grow close to 8 per cent.

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CORPORATE / INDUSTRY

4)INDIA’S largest drugmaker Ranbaxy is now a subsidiary of Japanese drug major Daiichi Sankyo. The Tokyo-based company on Monday bought 21.9% stake from the promoters and another 11% through allotment of preferential shares at Rs 737 per share. This is in addition to the 20% stake that Daiichi bought from the company’s shareholders through its open offer. These three transactions take the Japanese company’s stake in Ranbaxy to 52.5% making it the undisputed owner of the Indian company.

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MONEY & BANKING

5)SOME good news, finally, It’s just a matter of time before home loan interest rates start coming down. Since the cash crunch has turned bankers risk-averse, they may wait a while to figure out whe- ther the worst is over. But at the end of the day, they will have little choice but to cut loan rates. An unexpected interest rate cut by the Reserve Bank of India on Monday was a strong signal to banks that they should go out and lend instead of sitting on cash or parking the money in government bonds. Having raised money at high rates to battle an unprecedented liquidity crunch, banks will prefer to cut their deposit rates first before lowering interest on loans to consumers and corporates. But they know that the one percentage point(100 basis points) cut in the repo to 8% – the rate at which banks borrow from RBI – marks the beginning of a dovish monetary policy, with inflation becoming less of a concern. The RBI had last cut interest rate in 2004.

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6)THE rupee breached the 49-mark against the dollar on Monday, even as the unexpected repo rate cut by the Reserve Bank of India(RBI) boosted sentiment in the stock and bond markets. Heavy dollar demand by importers as well as nationalised banks for a defence-related purchase caused the rupee to fall to a low of 49.20 during the day. It finally ended the day at 48.97/98 against the dollar, weakening from the Friday’s close of 48.88/89.

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7)CANARA Bank has reported a 32% year-on-year rise in net profit for the second quarter(Q2) ended September 30,2008. Net profit stood at Rs 529 crore against Rs 402 crore driven by a 29% year-on-year rise in net interest income in Q2 of the current fiscal.

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INSURANCE

8)THE Tata Group is learnt to have started negotiations to buy AIG’s 26% stake in the life and non-life joint ventures, Tata AIG Life and Tata AIG General, respectively. The discussions between the parties has gained momentum with AIG in the process of selling its Asian operations, barring India.

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9)ICICI Prudential Life Insurance, the country’s leading private life insurer, has posted a growth of 56% for the half-year ended September 30,2008, garnering total received premium(new business and renewal) of Rs 6,726 crore as against Rs 4,311 crore during the corresponding period in FY2008. Renewal premium, one of the key indicators of long-term sustainability of the business,showed strong growth of 90% and stood at Rs 3,423 crore for first half of FY2009.

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MARKETS

10)Gains in banks after the Reserve Bank of India announced a 100-basis point cut in the reporate and bargain buying in technology shares led Indian shares to close higher Monday, snapping a three-day fall. However, the BSE’s 30-stock index pared part of its early gains on profit-taking, as investors trimmed their positions amid the current uncertainty prevailing in the US. The index ended up 247.74 points, or 2.5 per cent, at 10,223.09. It traded between 10,023.28 and 10,538.05 during the session. It had risen 5.6 per cent in intra- day trade. On the NSE, the 50-stock S&P CNX Nifty gained 48.45 points, or 1.6 per cent, to 3,122.80.

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11)In what can be seen as another closer step towards bringing in strict measures against short selling, or a possible ban, the Securities & Exchange Board of India(Sebi) has sent out a communication to the foreign institutional investors(FIIs), disapproving overseas lending or borrowing exerting selling pressure in the cash market in India.

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MUTUAL FUNDS

12)Mutual funds(MFs) heaved a sign of relief today after the Reserve Bank of India(RBI) announced a repo rate cut of 100 basis points. Repo rate is the rate at which RBI lends to banks. “The sentiment will definitely improve,” said Arvind Chari, fund manager-fixed income at Quantum Mutual Fund.

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13)CLOSE on the heels of providing an emergency credit line to cash starved mutual funds(MFs), financial regulators have announced another move to provide fund houses more relief. The securities and Exchange Board of India(Sebi) has announced that fund houses will now have more leeway in valuing bonds on their books. This will not only bring in more efficiency while calculating net asset values of funds, but also help fund managers get a better price while exiting their investments in times of redemptions.

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COMMODITIES

14)The Forward Markets Commission(FMC) hopes the ban on trading of eight commodities on exchanges will go in November. “We will take a call after studying the situation in mid-November and recommend suspension of the ban on four commodities(rice, wheat, urad and tuar),” Mr B C Khatua, Chairman of FMC, said.

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15)Gold was firmer on Monday as a recovery in oil prices boosted interest in the metal after last week’s sharp price fall, but retreated from earlier highs as the dollar pared losses against the euro. Spot gold was quoted at $788.40/790.40 an ounce at 1326 GMT, up from $781.70 an ounce late in New York on Friday. Earlier it touched a session high of $808.20.

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16)Gold prices bounced back by Rs 150 per ten gm on the bullion market on Monday on fresh buying interest. Standard gold (99.5 purity) rose by Rs 150 per ten gm to Rs 12,735. Pure gold(99.9 purity) also rose to Rs 12,800 from Rs 12,640. Silver ready(.999 fineness)moved up by Rs 90 per kg to Rs 18,065 from Rs 17,975.

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17)Pepper futures market witnessed high volatility on Monday as both sellers and buyers were active and good quantity was said to be traded. Prices of all the contracts moved up on buying support. October contract went up by Rs 9 a quintal to Rs 12,551. November and December deliveries increased by Rs 166 and Rs 160 a quintal to Rs 12,748 and Rs 12,890 respectively.

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REAL ESTATE

18)With the global economic meltdown taking its toll on the Indian real estate sector, the residential sector market has started witnessing a significant dent in demand, while demand for commercial properties nationwide, has started dipping by 70% to 80%. Retail developers too are holding on to their expansion plans and are seeing a dent of over 50% in demand, according to international property con- sultants and developers.

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19)Ansal Housing & Construction has launched a residential project worth Rs 140 crore, called Ansal town, at Alwar in Rajasthan. This project is spread over 42 acres and is initially offering plots for Rs 7-25 lakh. Later, built-up villas and apartments will be introduced in the township, the company has informed the BSE.

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20)Swarnanjali Projects Private Ltd launched its first realty project Swarnanjali Greens’ at Kottur, near the Hyderabad International Airport, Shamshabad. The project, launched by Mr C V S K Sarma, Principal Secretary, Municipal Administration, Hyderabad, would have 200 homes each on 200 square yards plots. According to Mr Syed Ahmed Rauf, Director, Swarnanjali Projects, “The project is coming up near to fully developed commercial and residential surroundings at reasonable price and easy scheme of 40 month instalments.”

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INFORMATION TECHNOLOGY

21)THE father of the Pentium chip, a breakthrough chip for Intel, Vinod Dham, believes that Indian outsourcers will be the beneficiaries of the current crisis in the US. Mr Dham, who is now a venture capitalist like many other successful tech entrepreneurs of his time, says the stories of gloom and doom are not entirely unfamiliar to him. “After the dotcom bust, everybody said Indian IT growth was over. But look where they are now. The same thing is likely to repeat itself,” he said.

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22)Having burnt fingers due to high exposure in the US and UK markets, Indian IT sector sees huge opportunity emerging in Japan. Currently, Japan contributes a mere 2% to the total revenues of the Indian IT sector at $1.1 billion. The total offshoring IT market size of the country is around $10.8 billion. That leaves a lot of room for growth for the Indian IT players considering that India is the second largest outsourcer for Japan after China, which has a 50% share of the market.

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INTERNATIONAL

23)European banks lined up on Monday to tap state rescue packages designed to ease the financial crisis and there were signs that institutions were beginning to lend to each other again. European shares rose by more than two percent on optimism the financial sector crisis might ease and US shares were also expected to open higher. The rate banks charge each other for dollar and euro loans fell, suggesting that confidence in dealing with other lenders was returning to the market.

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24)Crude oil rose for a second day on signs that the Organisation of Petroleum Exporting Countries may cut output to halt a 50 per cent drop in prices since July. OPEC may pare production by 1 million to 2 million barrels a day in stages at an October 24 meeting to stabilise prices, said Mr Chakib Khelil, the group’s President. Crude oil for November delivery rose 69 cents, or 1 per cent, to $72.54 a barrel at 11:03 a.m. on the New York Mercantile Exchange.

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25)FEDERAL reserve chairman Ben Bernanke told the US Congress Monday a fresh round of government stimulus is a good idea because there’s a risk the country’s economic weakness could last for some time. Bernanke’s remarks before the House budget committee marked his first endorsement of another round of energising stimulus, some- thing that Democrats on Capitol Hill have been pushing.

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26)SHARES in ING Group rebounded more than 20% at the start of trading Monday, after the Dutch government threw the bank and insurer a e10 billion($13.4 billion) life line to shore up its capital position. The move, which will temporarily make the state, ING’s largest share- holder, was announced late Sunday and intended to prevent the comp- any from becoming the latest victim of the global financial crisis.

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KARVY Realty (India) Limited www.karvyrealty.com
Economic Times www.economictimes.com
The Financial Express www.financialexpress.com
Business Line www.businessline.in
Business Standard www.business-standard.com
The Times of India www.timesofindia.com
The Hindu www.hindu.com
Deccan Chronicle www.deccan.com
The New Indian Express www.newindpress.com

Headlines (20 October 2008)

GENERAL

1)On his nightly stroll, G Madhavan Nair, chairman, Indian Space Research Organisation(ISRO), used to gaze at the moon for its luminous beauty. Now, whenever he hears the word ‘moon’, which he does hundreds of times a day, he thinks of the 1,304-kg space craft carrying the 29-kg moon impact probe that will crash land on the lunar surface, just days after PSLV-C11 takes off at 6.20 am on October 22.

TOI

ECONOMY

2)Inflation figures of the government agencies are in for a big dose of downward correction as commodity prices come off their highs. First off the block will be the Planning Commission. The commission has projected a 6% rate of wholesale price index-based inflation by March 2009, incidentally just about the time the elections to the Lok Sabha are scheduled.

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3)Economists feel a repo rate cut by the Reserve Bank of India(RBI) next week would complement its recent liquidity-boosting measures and go a long way in spurring economic growth, which of late, has been sluggish. A bold decision to cut the repo rate by 0.50% would send positive signals to the economy and perk-up the tempo of growth, both in this fiscal and in the next (FY 2010), they said.

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CORPORATE / INDUSTRY

4)AT A time when companies are reeling under the burden of ongoing financial turmoil, National Mineral Development Corporation(NMDC), India’s nodal agency for iron ore, has increased domestic iron ore long-term contract prices by up to 46%. Globally, prices of Iron ore and steel are plunging on the back of softening demand. The move is likely hit steelmarkets such as Ispat, Essar, JSW and RINL which have long term contracts with NMDC.

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MONEY & BANKING

5)Bankers have said they would wait till the reviewed monetary policy is declared to take a call on lending rate cuts despite the RBI announcing a hefty 2.5% reduction in cash reserve ratio(CRR), injecting Rs 1,00,000 crore into the banking system. Though leading public sector lender, Punjab National Bank(PNB), announced a 0.5% cut in its home, auto and education loan after the CRR cut, several other banks said they wait till the October 24 monetary policy review before taking any decision.

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6)Chennai-based, state-run Indian Bank has reported a 14.27 per cent increase in net profit during the second quarter ended September 2008 at Rs 282.93 crore compared with Rs 247.59 crore for the same period last year.

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7)State Bank of Travancore(SBT) has recorded 70.37 per cent rise in net profit during the second quarter ended September 2008, over the same period last year. The bank posted a net profit of Rs 113.83 crore as against as 66.81 crore during the corresponding quarter of the previous year.

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INSURANCE

8)RELIANCE Anil Dhirubhai Ambani Group (R-ADAG) is looking to buy out the Asian insurance business of US-based financial services giant AIG. The proposed deal, which would exclude AIG’s Indian insurance joint ventures, would make R-ADAG the largest life insurance firm in South East Asia.

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MARKETS

9)LIKE a dying man clutching at straws, investors have not given up hope altogether. After the benchmark Sensex fell below the 10000 mark on Friday, hopes are pinned on the Nifty’s much-talked about technical support of 3000, which is expected to trigger a rebound driven by short-covering. Investors will also keenly watch the midterm credit policy review on October 24, as the liquidity in the system continues to be tight despite the central bank’s monetary measures. In the past couple of weeks, RBI has cut the cash reserve ratio(CRR) – the amount of money that banks have to maintain with the central bank – by 250 points and relaxed the statutory liquidity ratio(SLR) requirements. Market watchers expect RBI to announce a cut in the repo rate – the rate at which it lends to banks – on the policy day. This is one move that will signal easing interest rates. Even reputed corporates have been borrowing short-term money at ex- orbitant rates. The high interest rates are forcing many of them to scale down their expansion plans. On Friday, the Nifty ended at 3074.35, down 195.95 points, or 6%, over the previous close. In the US too, markets ended weak on Friday, but the losses were limited compared with the previous sessions, sparking hopes of a bounceback early next week.

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IPO

10)Initial public offerings(IPOs) of the public sector units(PSUs) could revive investor confidence, which has taken a beating in wake of the global financial crisis, chief financial officers of Indian companies said in a survey. Majority of the 300 chief financial officers (CFOs), who participated in an Assocham survey said they had confidence in the Indian PSU equities.

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MUTUAL FUNDS

11)DESPITE mounting pessimism among investors, there is fresh money flowing into equity mutual fund schemes. Barring August, there have been fresh inflows into equity funds this year, an indicator that retail investors have chosen to stay on so far. However, fund managers are apprehensive that October could be a month of high outflows. According to AMFI data, open-ended equity schemes recorded fresh inflow worth Rs 658 crore in September. This genre of fund schemes also witnessed positive inflows between January and July. There was an outflow worth Rs 95 crore in August. Investors are not very keen on closed-ended equity funds, as most schemes of this type have logged outflows in all months after March. Though there have been a few equity New Fund Offerings(NFOs) hitting the market between March and August, very little money flowed in through these offerings. Counting out ICICI Prudential Focused Equity and AIG World Gold(both funds closed in May), almost all schemes launched during the considered period had to prune their mobilisation targests. “Over 40% of fresh money flowing into equity funds is through SIPs. Though there has been some redemption, there is an overwhelming majority who has started investing into SIPs. We are selling equity mutual fund products in these markets as well,” said Tata Mutual Fund managing director Ved Prakash Chaturvedi.

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COMMODITIES

12)The host of problems in the global economy, like the subprime meltdown, the financial crisis downturn in the equity markets, along with commodity prices still remaining at high levels, are all forcing investors to rediscover the lustre in gold. According to a recent report by team of analysts headed by Kevin Norrish from Barclays Capital, investing in gold will be seen as a way out of the global economic turmoil. A study made by Merrill Lynch & Co Inc under the team leader Francisco Blanch shows gold prices can shoot up to $1,500 an ounce in the near future.

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13)The National Commodity and Derivatives Exchange(NCDEX) has reduced the number of jeera contracts to seven from current nine per year, an exchange release said. NCDEX has dropped the contracts for April and October in 2009, taking the total available contracts to seven in the current calendar. Globally, farm commodities do not have futures contract for the period when spot trade remains subdued due to reasons like harvest, monsoon etc., the official said.

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REAL ESTATE

14)Makaan.com, a property portal, is hosting a two-day property show in Hyderabad bringing together more than 20 leading developers and showcasing models of over 100 plus projects. The Business Head of Makaam.com, Mr Aditya Verma, said this is the second such show in Hyderabad and 10th nationwide in a series of such events which help potential buyers get to know what is available in the market place. Property seekers get to choose from options of plots, villas and apartments with price ranging from Rs 5 lakh to Rs 5 crore.

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COMMUNICATIONS

15)A leading European telecom giant is set to acquire a little over 43 per cent stake in Unitech’s telecom venture for $1.4 billion. According to highly-placed sources close to the deal, the legal documentation is likely to be completed shortly and announcement to this effect is expected by the weekened or early next week.

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INFORMATION TECHNOLOGY
 
16)ASIA Pacific’s IT spending is expected to grow about 10-16% till 2010, beating developed markets, according to a study by consulting firm Zinnov. India and China, in particular, represent large untapped markets in the region. While India’s IT spending is likely to grow between 17.6-24% by 2010, China would grow 10-13%, according to the study. This is in comparison to the 3.3-6.5% increase expected in global IT spending. Expenditure on hardware, software and IT-BPO services comes under IT spending.

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17)INFOSYS Technologies has bagged an order from the Union Bank of California, US for its core banking solution(CBS) – Finacle – beating its bigger rival Tata Consultancy Services (TCS). Sources said Infosys and TCS were the two short-listed vendors which comes as a surprise given the presence of banking products companies in the US like Temenos, Fiserve and Metavante, among others.

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INTERNATIONAL

18)PRESIDENT Bush, looking for answers to an global economic emergency with just three months left in office, will host an international summit to discuss ways to fix the world financial system but warned on Saturday against reforms that threaten capitalism. “We will work to strengthen and modernise our nations’ fianancial systems so we can help ensure that this crisis doesn’t happen again,” Bush said at the Camp David president retreat. Bush, meeting with French president Nicolas Sarkozy and European commission president Jose Manuel Barroso, did not announce a date or site for the summit. But Sarkozy suggested it be held in the shadow of Wall Street before the end of November.

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19)DUTCH financial group ING is in talks with the Dutch government about a state-backed cash injection estimated to be worth up to 9 billion euros($12.12 billion), the Sunday Times reported. The Netherlands’ biggest listed bank, which said on Friday that it was about to announce its first-ever quarterly loss, is expected to announce a deal in the next 24 hours, the paper reported.
 
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KARVY Realty (India) Limited www.karvyrealty.com
Economic Times www.economictimes.com
The Financial Express www.financialexpress.com
Business Line www.businessline.in
Business Standard www.business-standard.com
The Times of India www.timesofindia.com
The Hindu www.hindu.com
Deccan Chronicle www.deccan.com
The New Indian Express www.newindpress.com

Headlines (17 October 2008)

GENERAL

1)With India searching worldwide for partners in its ambitious future combat soldier programme, New Delhi and Washington on Thursday agreed to cooperate in the project to enhance the capabilities of the modern system.The agreement was reached here during the meeting of Army Chief General Deepak Kapoor and his US counterpart General George W Casey, who arrived in New Delhi on Thursday for a three day visit. The two agreed to cooperate in exchange of military and related – technologies for development of enhanced capabilities for India’s future infantry soldier as a system (F-INSAS) programme.

Indian Express
 
ECONOMY

2)Driven by the steepest week-on-week decline (0.5%) in the wholesale price index (WPI) since April 2000, inflation for the week ended October 4 dropped to 11.44% from 11.8% for the week before. Year-on-year inflation was at 3.22% for the corresponding week last year. While overall inflation continues to trend down, prices of primary articles has inched up in recent weeks. According to economists; the southward journey of inflation numbers is emerging as a convincing trend. They pointed out that the fall in commodity prices along with the tight liquidity scenario will bring down inflaion further in months to come. Saumitra Chaudhary, member Prime Minister’s Economic Advisory Council, even expects inflation to move in to single digits by December.

ET

3)The government has sought data from the Reserve Bank of India to consider a proposal to enhance the investment limit for bank exposure to equity markets as part of several measures to boost domestic institutional participation at a time when foreign institutional investors (FIIs) are exiting. At present, a bank can invest up to 20 per cent of net worth in a single company and up to 40 per cent of net worth in a group. Most banks are well below the present stipulation. The limit may be enhanced only for those banks that have sound risk management practices.

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CORPORATE / INDUSTRY

4)Ashok Leyland, the 53-year old brand synonymous with commercial and public transport in the country, will soon see a name change, reflecting its ownership by the Hinduja Group. The Hindujas, who took over Ashok Leyland in 1987, is planning to rename the company Hindja Leyland, in sync with the Group’s strategy to give a common brand identity to various companies within the group, spanning auto- motive to media.

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5)Kolkata-based Emami, today, acquired management control of Zandu Pharmaceutical Works after it bought an 18.5 per cent stake from the Parikh family, through an out-of-court settlement, ending months of uncertainty over a hostile takeover bid.

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MONEY & BANKING

6)The rupee ended down against the dollar as banks bought the greenback noting persistent outflows from foreign funds on a sharp fall in local share indices. However, dollar sales from the Reserve Bank of India through government-owned banks helped the rupee trim some intraday losses, dealers said. The Indian unit closed at 48.82 to a dollar, weaker by around 30 paise from 48.52 on Wednesday. It moved in 48.63-49.08 range intraday.

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7)Rising advances and increasing margins helped HDFC Bank report a 43.3% rise in net profit in the second quarter(Q2) ended September 30. The net profit was at Rs 528 crore against Rs 368 crore in the previous fiscal. Results for the quarter include that of the erstwhile Centurion Bank of Punjab(CBoP) which was amalgamated with the bank with effect from April 1.

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8)INDUSIND Bank posted a 51% rise in net profit for the quarter ended September 30,2008, thanks to higher income from fee and interest. During the quarter, the bank registered a net profit of Rs 33.6 cr compared with Rs 22.3 in the corresponding quarter last financial year.

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MARKETS

9)The Bombay Stock Exchange(BSE) bellwether, Sensex, plunged 790 points during trade today on fears of an imminent recession in the US, but softening inflation numbers at home and signs of recovery in overseas markets helped it trim losses to 228 points at close. The Sensex started the day with a sharp fall, showing that investors discounted the Reserve Bank of India’s (RBI’s) move to inject more liquidity into the system through a further cut in the Cash Reserve Ratio(CRR). However, the benchmark index came off lows, taking cues from European bourses and indications that US index futures would open higher on Wall Street. The 30-share Sensex ended at 10,581.49 as against yesterday’s close of 10,809.12, a loss of 227.63 points, or 2.11 per cent. The 50-share Nifty of the National Stock Exchange (NSE) also fell by 69.10 points, or 2.07 per cent, to close at 3,269.30.

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10)TRADERS in equity futures and options segment are getting to know the taste of a liquidity squeeze. A day after Sebi hiked exposure margins for positions, many brokers are not taking any chances. They have enforced the rule with immediate effect, though the Sebi circular says the revised margins will become effective only from October 21.

ET

11)With FIIs pulling out of stock market, Sebi on Thursday removed the conditions limiting FII’s allocation of funds between debt and equity, a decision that will provide greater flexibility and investment options to overseas investors. “It has been decided to do away with the conditions provided in…FII regulations pertain-ing to restrictions of 70:30 ratio of investment in equity and debt, respectively, with immediate effect,” the market regulator said in a circular.

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RIGHTS ISSUE

12)Chettinad Cement Corporation Ltd has approved and revived an earlier proposal for a rights issue to its shareholders to raise Rs 250 crore, according to information provided by the company to the stock exchange. The company plans to issue one new equity share on rights basis for every six held by a shareholder for a total value not exceeding Rs 250 crore.

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COMMODITIES

13)Most spices today were back in positive territory to trade a shade higher on the National Commodity and Derivatives Exchange on speculators buying, triggered by lower arrivals in the physical markets. Jeera, the most-active October contract traded Rs 70, or 0.5 percent higher at Rs 10,640 a quintal at the NCDEX on expectations of pick-up in export demand, following lower output in other major producing countries – Syria and Turkey.

BS

14)The pepper futures market, which was on a downward trend in the morning, recovered in the afternoon and closed above Wednesday’s price. Good quantity of pepper is said to have been traded at discount price. Investors were buying back their sales. Domestic buyers as well as exporters were actively buying to meet their commitments at prices below the spot prices.

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REAL ESTATE

15)Mid-sized real estate companies have started feeling the heat of the global meltdown. Delhi-based Omaxe Construction and Infrastructure is planning to offload 26% stake to investors and private equity (PE) players and is said to be in talks with sovereign wealth funds from Bahrain, Singapore, Kuwait, and Dubai, apart from Temasak of Singapore.

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COMMUNICATION

16)Bharti Airtel, the country’s leading private telecom service provider, is keen to acquire a telecom player similar in size to South African gaint MTN in the emerging markets to become a global brand, said Akhil Gupta, deputy group CEO and managing director of Bharti Enterprises.

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INFORMATION TECHNOLOGY

17)The gloomy global economic outlook and reduced demand for technology services in the US and Europe are likely to result in an increased pace o consolidation among small and mid-tier IT services companies in India, analysts say. Export-oriented small and midtier IT companies were able to weather the storm of rapid appreciation in the rupee against the US dollar in 2007 and early 2008, but now they are faced with the stark reality of dwindling orders. Sudin Apte of Forrester Research says that consolidation in the Indian IT industry was on the way anyway but the pace may pick up in the next 18 months.

ET

18)HCL Technologies – the sole bidder left in fray after Infosys pulled out of the race for Axon – has purchased 10.43 per cent stake in the UK-based SAP consulting firm, at 631 pence a share. “We have purchased an additional over 10 per cent of Axon shares for a net value of 631 pence per share through market purchases. It is a smart move and we will reveal our strategy in the coming days,” the HCL Technologies CEO, Mr Vineet Nayar, said.

BL

19)Cisco Systems, the global networking giant has announced the launch of its global talent acceleration programme (GTAP) in India, which will see them, for the first time, providing training directly to fresh gradu-ates as well as experienced professionals. India is the third country where the GTAP has been launched after Jordan and South Africa. The first batch in India will comprise 150 students.

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20)Moser Baer on Thursday said it plans to invest over $800 million in capex for its various businesses including optical media and photovoltaics, over the next 18 months. “For FY09, our capex plans stands at $550 million in capex across the Group.”

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INTERNATIONAL

21)THE global financial crisis shifted gears on Thursday with fears of recession battering financial markets even as governments sought yet more action to pull the world economy from the brink of collapse. European Union leaders, meeting in Brussels, were to call for action to combat economic decline, including support for industry. Switzerland’s two largest banks – UBS and Credit Suisse – became the latest to say they were receiving emergency funding as the country’s government and other investorss moved to shore them up.

ET

22)JP Morgan Chase has become the largest US bank by assets, surpassing long-time leader Citigroup. Citigroup on Thursday said it ended September with $2.05 trillion of assest, while a day earlier JP Morgan said it ended the month with $2.25 trillion.

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23)OIL prices slumped further on Thursday, with Brent crude briefly sliding close to $67 a barrel and the lowest level for more than 15 months, as slowing energy demand took its toll, traders said. Crude oil futures were down more than 50% from record highs of above 147 dollars reached in July, when prices had rocketed on fears of supply disruptions.

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KARVY Realty (India) Limited www.karvyrealty.com
Economic Times www.economictimes.com
The Financial Express www.financialexpress.com
Business Line www.businessline.in
Business Standard www.business-standard.com
The Times of India www.timesofindia.com
The Hindu www.hindu.com
Deccan Chronicle www.deccan.com
The New Indian Express www.newindpress.com

Headlines (16 October 2008)

GENERAL

1)The 10-day final phase of the Indo-US Malabar naval wargames kicked off on Wednesday, with an American nuclear-powered aircraft carrier, a nuclear submarine and five other warships undertaking combat manoeuvres with seven Indian warships and a diesel-electric submarine in the Arabian Sea.

TOI

ECONOMY

2)The Centre for Monitoring Indian Economy (CMIE), an independent think tank, has scaled down India’s growth rate forecast to 8.7 per cent in 2008-09, as against an earlier projection of 9.4 percent. Interestingly, the CMIE said the revised estimate was ‘not entirely’ due to turmoil in the financial markets, but because of a slowdown in the real estate sector and delays in implementation of investment projects.

BS

CORPORATE / INDUSTRY

3)POWER equipment major Bharat Heavy Electricals(BHEL) has joined the race for Czech power utility company Skoda Power. Skoda Power, a subsidiary of Skoda Holdings, is a leading European manufacturer and supplier of technological equipment and customer services in the field of power generation. The bidding will be held online and BHEL will be competing against 15 other global firms.

ET

4)Indu Projects along with Srinivasa Construction, Kirloskar Brothers and WEG Electric has bagged the Rs 1,447 crore project related to the Pranahita-Chevella lift irrigation scheme. The share of Indu Projects in this contract is expected to be Rs 588 crore.

ET

MONEY & BANKING

5)The rupee fell against the dollar on Wednesday as it tracked the equities market and on month-end dollar demand. “There are no positive signs for the rupee and it will continue to remain under pressure for some time. There was overall dollar buying with a private bank. The rupee opened on a weak note at 48.34/36 and closed at 48.52/54, against the previous close of 48.10.

BL

6)The Reserve Bank of India(RBI) today cut by a further percentage point the cash reserve ratio(CRR) or the amount of mandatory cash that banks need to park with it. The move is with retrospective effect from October 11 and is expected to unlock Rs 40,000 crore into the financial system and pave the way for lower lending rates. This is the third time the central bank has cut the CRR in two weeks, bringing the combined cut to 2.5 percentage points, releasing a total of Rs 100,000 crore into the cash-starved banking sector to allow it to resume normal lending operations.

BS

7)DENA Bank, Andhra Bank, Vijaya Bank and UCO will benefit the most, with the government decision to infuse capital into commercial banks to improve their capital adequacy ratio(CAR). On Wednesday, the government announced that it would provide banks access to finance to raise their capital adequacy ratio(CAR) up to 12%. CAR is the amount of capital that banks need to set aside as a prudential practice based on the risk associated with various assets. Among government-owned banks, Dena Bank, Andhra Bank and UCO Bank have a CAR of less than 12% and its shareholding in these banks has nearly touched 51% – a level below which the government can not reduce its stake if it wants to raise fresh equity.

ET

8)Punjab National Bank(PNB) on Tuesday decided to reduce the interest rates by 50 basis points on housing and car loans, becoming the first lender to announce a rate cut amid series of liquidity injection measures by the Reserve Bank of India (RBI) and the government. The interest rate has been reduced on housing, educational and car loans with effect from Thursday, PNB chairman and MD KC Chakrabarty said.

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INSURANCE

9)Private life insurer Max New York Life today launched a new policy aimed at low income group in the rural and urban areas. Max Vijay is a noval insurance and savings product primarily targetted at people in the income bracket of Rs 30,000-3 lakh per annum. The product would be made available to the customers by a wide spread distribution network, including the neighbourhood retail outlets and even NGOs. There is minimum formality in buying the policy and the premiums can be paid easily just like topping up or recharging a mobile phone.

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MARKETS

10)The BSE Sensex under performed major global indices today as the Indian benchmark fell 5.87 per cent, or 674 points, to close at 10,809. The broader index, S&P CNX Nifty of the National Stock Exchange (NSE), fell 5.12 per cent, or 180 points, to end the day at 3,338. Heavy selling by foreign institutional investors (FIIs) snapped the two-day rally in domestic stocks.

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11)SEBI on Wednesday increased the margin requirement for exchange traded equity derivatives, a step to protect the interest of investors, amid huge volatility being witnessed on bourses in the past few days. “With a view to ensure market safety and safeguard the interest of investors, it has now been decided that the expo- sure margin shall be higher of 10 per cent or 1.5 times the stand- ard deviation,” Sebi said in a circular.

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12)IN another move to boost investor sentiment, the government has decided to double foreign investment limits in corporate debt to $6 billion. This is the second time that the investment limits for FIIs in debt has been increased this year. Market participants have welcomed the move in the anticipation that foreign money will flow in to the cash-strapped markets. With the current investment limit of $3 billion fully utilised, bankers are bullish about further foreign investment coming in through this route.

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MUTUAL FUNDS

13)AT A time when investing in realty and real estate-related instruments is considered a taboo, a few fund houses – having debt port- folios – are seen holding on to their investments in debt securities issued by real estate companies. Fund houses like LIC Mutual Fund, Canara Robeco Mutual, Reliance Mutual and DSP ML reveal substantial holdings in the real estate sector at the end of September. As per mutual fund tracker MFI Explorer, the liquid and liquid-plus funds of LIC Mutual Fund hold 19% and 65%, respectively, on each portfolios in real estate debt papers. LIC’s floater fund holds nearly 71% investments in papers issued by real estate companies. The Canara Robeco floater has nearly 46% in real estate debt securities.

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14)Franklin Templeton Mutual Fund will Thursday launch ‘Plan D’ under Templeton Fixed Horizon Fund Series-XI, a fund house notice said today. Subscription to the 367-day income plan will close Oct 22. The close-ended scheme will invest its entire corpus in fixed-income securities with a maturity profile similar to that of the plan.

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15)HDFC Mutual Fund will launch a 90-day fixed term plan on Friday that will close for subscription on Tuesday. HDFC FMP 90D will be under HDFC Fixed Maturity Plans-Series IX.

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CORPORATE SCORE

16)Despite a pressure on profitability in some segments like its electricals business, Larsen & Toubro Ltd(L&T) has posted a net profit of Rs 460 crore for the quarter ended September 30,2008, registering an increase of 32% over the corresponding quarter of the previous year.

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COMMODITIES

17)Gold prices jumped by Rs 130 to close at Rs 13,330 per 10 gram in the bullion market in New Delhi on buying by stockists and investors as melting stock market boosted the demand for the precious metal as a safe haven.

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REAL ESTATE

18)DLF Home Developers Ltd plans to invest Rs 4000 crore in Kerala for the next years for the construction of hotels, shopping malls and office complexes along with the residential apartments. DLF lauched the mega residential project in Kochi on Wednesday which would have 1500 apartments setting new benchmarks for the industry in Kerala.

Indian Express

19)RELIANCE Infrastructure, a unit of Anil Ambani’s ADAG group, would go slow in its real estate projects, where the company has to spend about Rs 5,000 crore over the next five years. The move is because of the general tightening in liquidity conditions.

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20)Undeterred by the ongoing global financial meltdown, private equity(PE) firm Red Fort Capital plans to invest Rs 3,200 crore by the next year to cash in on the liquidity crunch in the real estate sector. “Since the financial crisis started last month, the number of proposals to us has increased by over 50 per cent; some of them are well-established, big developers,” Red Fort Capital Director Kuldip Chawlla said.

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INFORMATION TECHNOLOGY

21)If you deliver top class products or services, you can weather the current global down turn – because in the information technology business, quality sells, in good times and bad: that was the message industry leaders heard at the National Association of Software and Service Companies'(Nasscom) annual quality summit which opened in Bangalore on Wednesday.

Hindu

22)The current liquidity crunch in India seems to be creating a problem for IT companies when it comes to collection of dues. Several mid-tier IT firms have said that some of their domestic clients have delayed payments by six months to a year.

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23)HCL Technologies on Wednesday reported a 15.5% year-on-year and 152.5% quarter-on-quarter increase in consolidated net profit for the first quarter ended September 2008 at Rs 356.2 crore. Consolidated revenue grew 38.6% y-o-y and 9.2% sequentially to Rs 2,369.2 crore, driven by growth in verticals such as life sciences, hi-tech and telecom. HCL declared a 150% interim dividend for the first quarter of its financial year.

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INTERNATIONAL

24)European leaders pressed on Wednesday for an overhaul of global financial structures, as signs of global recession mounted. The United States reported its biggest monthly decline in retail sales in more than three years in September, sending stock index futures lower before Wall Street markets opened.

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25)Oil prices fell on Wednesday to their lowest in 13 months, dragged down by expectations that economic weakness will cut further into demand for crude. US crude was down $2.70 a barrel at $75.93 by 1335 GMT. It touched a session low of $74.97, its lowest since September last year.

BS

FOR MORE INFORMATION, PLEASE BROWSE THROUGH THE FOLLOWING SITES.

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 www.khojhyderabad.com
 www.indiacorporateadvisor.com
 www.karvycomtrade.com (Commodities)
KARVY Global Services Ltd www.KARVYGlobal.com
KARVY Realty (India) Limited www.karvyrealty.com
Economic Times www.economictimes.com
The Financial Express www.financialexpress.com
Business Line www.businessline.in
Business Standard www.business-standard.com
The Times of India www.timesofindia.com
The Hindu www.hindu.com
Deccan Chronicle www.deccan.com
The New Indian Express www.newindpress.com

Headlines (15 October 2008)

GENERAL

1)The Assembly elections in Chhattisgarh, Madhya Pradesh, Mizoram, Rajasthan and Delhi will be held between November 14 and December 4, the Election Commission announced on Tuesday. No decision has been taken on holding the polls in Jammu and Kashmir.

Hindu

ECONOMY

2)Even as airlines struggle with dwindling passenger numbers, the aviation industry awaits the four-day spectacular show in Hyderabad, beginning Wednesday. The India Aviation-2008, an aviation conference and expo, promises to the stakeholders a peep into the shape of things to come.

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CORPORATE / INDUSTRY

3)RELIANCE Industries (RIL) has chalked out an elaborate plan to venture into the power business. The plan includes an integrated project comprising coal mining, a coal-to liquid (CTL) plant, a 1,000-mw power plant based on coal rejects and a fly-ash utilisation unit. The firm has entered into an agreement with the US-based energy majors Exxon-Mobil, Headwaters and the German engineering firm Uhde GmbH. The 1,000-mw plant in Angul (Orissa) is proposed to be put in partnership with Torrent Power.

ET

4)TATA Motors has acquired a 50.3% holding in Norway-based electric vehicle major Miljo Grenland/Innovasjon for Rs 9.4 crore(Kroner 12 million) through its UK subsidiary, Tata Motors European Technical Centre. The existing shareholders will retain the remaining stake in the company.

ET

MONEY & BANKING
 
5)The rupee erased most gains against dollar as banks bought the green back to meet demand from oil companies and other importers, dealers said. The Indian unit closed at 48.07 to a dollar compared with 48.25 on Monday. It had risen to an intraday high of 47.57 today.

BS

6)As the festive season nears, banks are not only offering higher deposit rates but also reducing rates for their retail loans. This is despite a tight monetary policy. Two major state-owned banks Bank of Baroda and Union Bank of India – have decided to slash rates by 25 basis points on their home loan rates. They are keen to continue with the lower rates even after the festive season if the Reserve Bank of India(RBI) announces cuts in repo rate and the statutory liquidity rate(SLR) in its forth coming credit policy on October 24.

FE

7)The South Indian Bank (SIB) recorded a rise of 44.80 per cent in net profit to Rs 51.68 crore for the second quarter of the current financial year as against Rs 35.69 crore in the corresponding quarter last year.

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MARKETS

8)Profit-booking in blue-chip companies in the second-half of the session on Tuesday trimmed gains in shares, which ended near the day’s low. The benchmark Bombay Stock Exchange’s 30-stock index ended up 174.31 points, or 1.5 per cent, at 11,483.40, helped by gains in technology counters. It had gained as much as 5 per cent to 11,870.22 in initial trade due to a sharp overnight rally in the US. On the rival National Stock Exchange, the 50-stock S&P CNX Nifty rose 27.95 points, or 0.8 per cent, to 3,518.65. It had risen to 3,648.25 in early trade.

BL

9)THE market may not be out of the woods yet, but going by anecdotal evidence, this may be a good time to start bottom fishing in frontline stocks. Reason: attractive valuations apart, there is too much pessimism among market participants. Brokers feel that when the recovery starts, it would be the frontline stocks leading the rally. Though most foreign equity analysts view the recent rebound in equities as unstable recovery, a section of market watchers back home, feel Indian market is very near to bottoming out. “It is possible that the market may have bottomed out,” said Karvy Stock Broking vice-president Ambareesh Baliga. According to Mr Baliga, the ‘pain’ (referring to the bearish phase) will last for a long time. Though valuations are compelling, most investors are not convinced that now is the time to start lapping up shares, he added. “We’re advising investors to start buying once the market attains some stability, even if it means key stocks appreciating 10% from current levels. For sure, this is the time to buy large-cap stocks; the rally will begin with large-cap stocks,” Mr Baliga said.

ET

10)THE government and the stock market regulator Sebi are keeping a close watch on short-selling in the Indian stock market. The finance ministry is understood to have sought data on short-selling from Sebi. While there is no immediate move to ban short-selling, both the regulator and the government are examining if there was a need to further improve disclosure norms.

ET

IPO

11)Public sector Oil India Ltd (OIL) is unfazed by the financial market turbulence and intends to proceed with its planned initial public offering (IPO) after receiving Government Clearance.

BL
 
BUYBACK

12)India’s largest real estate developer DLF has rescheduled the proposed buyback of its equity shares to October 17 in order to comply with some regulatory requirements. The buyback offer was earlier scheduled to open on October 15.

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MUTUAL FUNDS

13)In a bid to help the domestic mutual fund industry, which is reeling under a severe liquidity crisis, the Reserve Bank of India(RBI) has decided to allow them to raise funds against certificates of deposits (CDs). The central bank will also conduct a special 14-day repo auction, at which it would infuse Rs 20,000 crore to meet the liquidity requirements of MFs.

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14)Lotus India Mutual Fund has filed offer document for an equity scheme that will invest in shares of companies featuring in the S&P CNX Nifty Index, as per information on the Securities and Exchange Board of India website.

BS

15)Birla Sun Life Mutual Fund today launched Birla Sun Life Fixed Term Plan – Series BH, a 370-day income plan that will close subscription on October 20, an official with the fund house said. The plan will invest in debt and money market instruments with a similar maturity profile.

BS

16)IDFC Mutual Fund will Wednesday launch IDFC Fixed Maturity Plan Yearly Series-27, which will close its initial subscription Oct 23, an official from the fund house said today. The close-ended income scheme will invest in debt and money market instruments with a similar maturity profile.

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17)Lotus India Mutual Fund today launched Lotus India Quarterly Interval Fund – Plan J, which will remain open for subscription till Wednesday. The open-ended quarterly plan will invest its assets in debt and money market instruments maturing in line with the duration of the plan.

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COMMODITIES

18)Losing nearly Rs 800 in three straight sessions gold prices on Tuesday closed at Rs 13,200 per 10 gm falling sharply by Rs 210 on the bullion market in New Delhi in line with weak global cues and shifting investor focus from funds to the surging bourses.

BS

19)GOLD is expected to lose some of its shine this Diwali. Yellow metal prices have surged almost 30% in the last one month, spoiling the festive spirit of buyers. This in turn is likely to affect sales for the jewellery makers who had witnessed upsurge of up to 200% in sales during August this year when prices had softened.

ET

20)Chilli futures continued to gain strength hitting the upper circuit for the second consecutive day. Strong demand in the Guntur spot market on Tuesday pushed up chilli futures by three per cent to Rs 5,673 a quintal. Maize hit the upper circuit of 2.98 per cent at Rs 846 a quintal on good buying interest at lower levels besides rise in spot prices amidst thin arrivals. Tumeric rose 1.98 per cent to Rs 3,562 a quintal on the back of short covering after recent down side movement. Soybean rose 1.06 per cent to Rs 1,667 a quintal on short covering.

BL

REAL ESTATE

21)While launching its Rs 700 crore real estate project named Rajgagh Estates in Ludhiana, Bhasin Infrastructures & Developers Private Ltd revealed its expansion plan and announced that the company would invest Rs 3,000 crore in the real estate projects in the state during next five years.

FE

22)OAKWOOD Asia Pacific, a unit of Los Angeles-based Oakwood Worldwide, plans to expand its portfolio of serviced residences in India and operate 10 properties by 2010 in Mumbai, Pune, Bangalore, Chennai, Hyderabad and New Delhi. “India and China are our focus markets due to their economic growth,” said Praveen Nair, country manager – India, Oakwood Asia Pacific.

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KNOWLEDGE PROCESS OUTSOURCING

23)SPECIALISATION can sometimes be a double-edged sword. India’s Knowledge processing outsourcing (KPO) sector, pegged at a size of $1.5 billion and predominantly servicing the financial services market, may see some serious rationalisation, re-definition of core business, diversification, slowdown in client additions and M&A play in the next six to 12 months, analysts reckon. Most KPOs have nearly 70% exposure to the US geography, which is reeling under history’s worst-ever economic crisis.

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INFORMATION TECHNOLOGY

24)Research firm Gartner Inc said global economic problems could impact next year’s IT budgets while lowering growth forecast by more than half from its earlier estimates. However, it said the budget cuts would not be as dramatic as one saw during the dotcom bust.

BL

INTERNATIONAL

25)US President George W Bush on Tuesday outlined steps to purchase equity stakes in US banks and temporarily expand government guarantees on new debt to review credit markets and restore confidence in the financial system. “This is an essential short-term measure to ensure the viability of the US banking system,” Bush said at the White House after meeting with his Working Group on Financial Markets, which includes treasury secretary Henry Paulson and Federal Reserve chairman Ben S Bernanke. The US will invest about $125 billion in nine of the nation’s biggest financial institutions, including Citigroup Inc and Goldman Sachs Group Inc, as part of a $250-billion effort to shore up the banking system. The othercompanies are Wells Fargo & Co, JP Morgan Chase & Co, Bank of America Corp, Merrill Lynch & Co, Morgan Stanley, State Street Corp and Bank of New York Mellon Corp, said people briefed on the plan.

FE

26)Crude futures traded lower on doubts that the US government’s plan to buy shares in large banks will prevent further declines in global oil demand. Light, sweet crude for November delivery traded 61 cents or 0.78 per cent, lower at $80.58 a barrel on the New York Mercantile Exchange.

BL
 

FOR MORE INFORMATION, PLEASE BROWSE THROUGH THE FOLLOWING SITES.
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 www.khojhyderabad.com
 www.indiacorporateadvisor.com
 www.karvycomtrade.com (Commodities)
KARVY Global Services Ltd www.KARVYGlobal.com
KARVY Realty (India) Limited www.karvyrealty.com
Economic Times www.economictimes.com
The Financial Express www.financialexpress.com
Business Line www.businessline.in
Business Standard www.business-standard.com
The Times of India www.timesofindia.com
The Hindu www.hindu.com
Deccan Chronicle www.deccan.com
The New Indian Express www.newindpress.com

Headlines (14 October 2008)

GENERAL

1)On November 10 or 11, the national flag will be hoisted on the moon. When the moon impact probe, bearing the Tricolour, ejects from the Chandrayaan-1 spacecraft and crashlands on the lunar surface, it will mark India’s leap into the club of countries aiming for the moon.

TOI

CORPORATE / INDUSTRY

2)IT IS a clear sign of desperate times. Two of the fiercest rivals for control of Indian skies, Jet Airways and Kingfisher Airlines, embarked on an extraordinary move to work out an operational alliance in a bid to rein in runaway losses.

ET

3)THREE of India’s leading generic drug makers, Dr Reddy’s Laboratories, Ranbaxy Laboratories and Wockhardt, are in the race for Germany’s largest health insurer Allgemeine Ortskrankenkasse(AOK)’s $3.5-billion drug supply contract as the world’s second largest drug market looks for ways to curb rising healthcare costs.

ET

MONEY & BANKING

4)After crossing the 49-mark last week, the rupee recovered against the dollar on Monday, though the intra-day movement was range-bound. The Sensex surged by over 780 points following comments by the Finance Minister that the Government would take further steps, if necessary, to improve the tight liquidity situation. The positive sentiment in the equities and the 150 basis points cut in CRR, which came into effect on Saturday, helped the rupee gain, said dealers. The rupee opened at 48.35 and closed at 48.25, against Friday’s close of 48.46.

BL

5)AXIS Bank reported a 76.8% rise in net profit for the second quarter ended September 30, 2008 due to strong growth in advances and fees, accompanied by a rise in low-cost deposits. The bank registered a net profit of Rs 403 crore in the quarter against Rs 227.8 crore during the corresponding period last year. For the half year ended September 30, the net profit rose 82% from Rs 403 crore to Rs 733.1 crore.

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MARKETS
 
6)Domestic stocks bounced back on Monday aided by heavy short covering as governments worldwide stepped up measures to increase liquidity in the world economy. Reassurance from the Finance Minister on the country’s financial stability, and his statement that the Government would take measures to improve liquidity initiated the ‘bounce back rally’ today, according to marketmen. However, the rally was on the back of thin volumes; and despite the world markets trading in the green, FIIs continued to be net sellers in Indian equity. On Monday net equity sales by them amounted to Rs 1,060 crore. Domestic institutions were net buyers for Rs 582 crore. The Sensex surged 7.42 percent from its previous close, gaining 781 points to end the day at 11,309. The Nifty gained 6.42 per cent, closing at 3,490.70.

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7)Indian equity indices staged on impressive comeback on Monday, snapping a five-day losing streak. The domestic markets rebounded on the back of short-covering and strong cues from the Asian and European markets. Indian markets started the day on a positive gap. Banking stocks, which were till last week hammered, out-performed the benchmark index on Monday. Bankex, the banking index of BSE, gained 654.34 points, or 12.30%, and closed the day at 5,973.84 points. All the BSE sectoral indices that had seen their 52-week lows last week, ended on the positive terrain on Monday.

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MUTUAL FUNDS

8)Mutual fund investors in equity schemes are not yet rushing to redeem their units but inflows have dried up substantially, said mutual fund distributors. Analysts said the fall in market has been so steep and sudden that there’s inertia; nobody wants to exit at a loss. But there could be some redemptions when the market starts picking up. K Sridhar, vice president at Karvy said there’s not much redemption but inflows into equity schemes have dried up by 71 per cent this year, according to the data released by the Association of Mutual Funds in India(AMFI). However, last month saw net inflows of Rs 604 crore in equity schemes against redemptions of Rs 232 crore in August 2008.

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9)JM Financial Mutual Fund will launch JM Fixed Maturity Fund-Series XIII-Quarterly Plan 2 on Tuesday. Subscription to the scheme will re- main open until Wednesday, a notice from the fund house said today. The quarterly income plan will deploy its entire corpus in short-term debt and money market instruments with a similar maturity profile.

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10)HDFC MF will Tuesday launch a 90-day fixed term plan, while it will float 181 and 370-day debt plans on Thursday, the second largest Indian mutual fund said in a notice today. HDFC FMP 90D October 2008(1) will close for subscription on Wednesday, while initial offers of HDFC FMP 370D October 2008(1) and HDFC FMP 181D October 2008(1) will end Oct 20 and Oct 23 respectively.

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COMMODITIES

11)Notwithstanding the government’s ban on futures trading on eight commodities and the turmoil in stock markets, Indian commodity exchanges continued their dazzling run. The turnover of 22 commodities exchanges across the country recorded a robust growth of more than 47% during the first half of 2008-09 and is on track to reach the targeted 57 lakh crore by the end of 2008-09.

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12)India’s mentha oil futures may rise this week on expectations of higher demand for the medicinal commodity as winter approaches, analysts said on Monday. Bargain buying, after a slump that dragged the far-month contract to a record low on concerns of slowing ex- port demand amid a global slowdown, will also support prices, analysts added.

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13)Gold prices in the domestic market fell by Rs 75 to Rs 13,345 for 10 gm on Monday even as it gained $4.30 an ounce on the London Metal Exchange. Pure gold was down by Rs 80 to Rs 13,405. Gold prices, which scaled to a life-time high last week, may tumble further with the rupee expected to strengthen making the dollar-priced gold cheaper, said an analyst.

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REAL ESTATE

14)While banks do not anticipate an immediate decrease in lending rates after the 150 basis-point cut in Cash Reserve Ratio by the Reserve Bank of India, real estate developers expect the measures to soften home loan rates for its consumers. Demand for real estate property has decreased by nearly 25-30 per cent in the country over the last 18 months, when home loan rates soared from an average of 7 per cent to as high as 12-13 per cent.

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COMMUNICATIONS
 
15)IF you bought a low-cost Chinese mobile phone recently, the investment might just turn out to be expensive. Because most of the Chinese mobile phones and locally-assembled handsets do not carry the International Mobile Equipment Identity or IMEI number, a 14-digit number used to identify valid devices. There are about 1.6 crore China-made and other locally-assembled handsets at present that don’t have an IMEI number. Calls from such phones may be barred and users will have to buy new handsets with genuine IMEI numbers, according to a recent note by the department of telecom(DoT). All mobile phones that have all zeroes or no zeroes in their IMEI codes will also be barred.

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BUSINESS PROCESS OUTSOURCING

16)The next 12 to 18 months could see large Indian IT service providers making bids for captive business process outsourcing centres, the prelude to which was the recent acquisition of Citigroup Global Services Ltd by Tata Consultancy Services Ltd. Industry experts believe one of the principal motivations for such buys is the large business contracts that come with it. Also, it would help the IT services providers, who were late entrants into the BPO space, to scale up their BPO operations.

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17)Even as IT majors are hiring in fewer numbers this financial year on the back of a slowing global economy and trauma in the banking, finance and insurance services(BFSI) sector, Indian business process outsourcing(BPO) firms – captive and pure play – appear bullish. They are increasing headcount in the country, attributing their optimism to business ramp-ups over the last couple of months and an increased acceptability of offshore work.

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INFORMATION TECHNOLOGY

18)Getting a passport would soon become easier with lower processing time and online filing. Tata Consultancy Services(TCS) on Monday signed a Rs 1,000-crore, six-year deal with the ministry of external affairs to implement the ‘passport seva project’ that envisages issuance of new passports within three working days and a ‘tatkal’ scheme to issue passports on the same day, after police verification.

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INTERNATIONAL

19)STOCK markets rejoiced after governments worldwide launched multi-billion dollar bailouts on Monday to shore up banks, and Britain called for a new Bretton Woods agreement to reshape the world financial system. Major Wall Street indexes were up more than 5% in early trade, clawing back some of the major losses last week, when the Dow fell 18%. The MSCI world equity index was up 5% after tumbling 20% last week to a five-year low. Britain, Germany, France, Italy and other European governments announced rescue packages totalling hundreds of billions of dollars that were designed to combat the global financial crisis, in which the credit markets have seized up at a time when major economies appear headed toward recession.

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20)Royal Bank of Scotland Group Plc, HBOS Plc, and Lloyds TSB Group Plc will get an unprecedented 37 billion pounds($64 billion) bail-out from the UK as governments across Europe act to avert a banking collapse.

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21)MITSUBISHI UFJ Financial Group(MUFG) completed its purchase of a stake in Morgan Stanley on Monday with US government support, helping close a deal that investors feared would fall apart. Morgan Stanley shares soared as much as 65% after Japan’s largest bank bought the stake – a day earlier than expected – after a week in which the New York bank’s stock plunging by more than half on fears Morgan Stanley might not survive.

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22)Crude rose, rebounding from last week’s 17 per cent plunge, as Governments in the US and Europe acted to stem the worst financial crisis since the 1930s. Crude followed stock market higher after the UK provided $64 billion of capital to its banks and the Federal Reserve said it will lend unlimited dollar funds to financial institutions. Crude oil for November delivery rose as much as $4.10, or 5.3 per cent, to $81.80 a barrel in electronic trading on the New York Mercantile Exchange.

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FOR MORE INFORMATION, PLEASE BROWSE THROUGH THE FOLLOWING SITES.
Karvy Consultants Ltd www.karvy.com
 www.khojhyderabad.com
 www.indiacorporateadvisor.com
 www.karvycomtrade.com (Commodities)
KARVY Global Services Ltd www.KARVYGlobal.com
KARVY Realty (India) Limited www.karvyrealty.com
Economic Times www.economictimes.com
The Financial Express www.financialexpress.com
Business Line www.businessline.in
Business Standard www.business-standard.com
The Times of India www.timesofindia.com
The Hindu www.hindu.com
Deccan Chronicle www.deccan.com
The New Indian Express www.newindpress.com