Monday, September 26, 2005

Sensex plumps up by 256 points following global recovery, oil price fall


The market spiraled up today, in line with the firmness across global
markets and a drop in global crude oil price. BSE Sensex posted its biggest
points rise in a single trading session since 18 May 2004. Data indicating a
surge in FII inflow on Thursday (22 September 2005) added to the market’s
strong showing. However, the latest data released after trading hours on
Monday showed that FIIs pressed substantial sales worth Rs 325.50 crore on
Friday (23 September 2005).

Turnover declined sharply today. BSE clocked a turnover of Rs 3,147.90
crore – much lower than Friday’s Rs 3,933.57 crore.

Index heavyweight Reliance Industries surged. Satyam Computer rallied after
the company said the World Health Organization (WHO) has chosen to work with
the company to implement its critical Global Management System (GSM). L&T
surged after the company announced another order win. FMCG stocks gained on
renewed buying due to positive outlook for the sector. State Bank of India
(SBI) firmed up on reports that it has floated new schemes to retain part of
$ 5.5 billion that will mature in December 2005, to help fund its growing
overseas operations.

Buying was conspicuous in IT, paper, auto-component, textile, bank, steel
and cement scrips

Small-cap and mid-cap stocks which had received a battering in the past few
days made a comeback. Stocks like BSL, IFB Securities, FAG Bearings,
Megasoft, Gujarat Borosil, Madhav Marbles, Sah Petroleum, Suashish Diamond,
Eveready Industries, Tata Yodogawa, BOC India, Gujarat Apollo Equipment,
Scandent Solutions, Bharati Shipyard, JK Corporation, Mid-Day Multimedia,
Plastiblends, KIC Metaliks, PSL, Sterling Biotech, Balrampur Chini Mills,
Auto Corporation of Goa, Punjab Alkalies, Indiabulls, Flex Industries,
Zodiac Clothing, Andhra Cement, Harita Seating, Ruchi Soya, Atul Auto, Eimco
Elecon, HBL Nife Power, Insilco, and El Forge rose between 10% to 20%.

A host of other side counters rose between 3% to 10% for the day.

The 30-share BSE Sensex jumped 256.32 points or 3.1% to 8,478.91. Sensex
ended close to the day’s high of 8,487.36.

The S&P CNX Nifty jumped 79.60 points or 3.2% to 2,557.35

Data released by Sebi after trading hours on Friday indicated that FIIs
bought shares worth a huge Rs 514.40 crore on Thursday (22 September 2005) –
the day when the Sensex tanked 265 points.

US crude fell about $ 1 a barrel on Sunday (25 September 2005) after
Hurricane Rita proved less threatening than originally feared. Oil was
trading at $ 63.35 in early Asian trade, well below the recent high near $
68 a barrel.

Trading on BSE and NSE was extended by 40 minutes till 16:10 IST starting
today due to sun outage. The extended trading is till 9 October 2005.

Reliance Industries jumped 4.6% to Rs 783.30. 34.55 lakh shares changed
hands in the counter on BSE.

Software scrips put up a strong showing. Wipro gained 4.9% to Rs 375, TCS
gained 4.2% to Rs 1,472 and Infosys rose 3.4% to Rs 2,484.

Satyam Computer Services rose nearly 5% to Rs 545.25. 11.4 lakh shares
changed hands in the counter on BSE. Satyam will spearhead the operational
overhaul for WHO after an elaborate REP and evaluation process that has
involved some of the industries, biggest players, Satyam Computer said in a
release.

NTPC gained 4.2% to Rs 106.70 after the company said the fourth 500 MW unit
of Rihand Super Thermal Power Station has been commissioned and connected to
the Northern Grid on September 24, 2005 and with the commissioning of this
unit, the total installed capacity of Rihand Super Thermal Power Station is
now 2000 MW.

L&T gained 4.2% to Rs 1,430. L&T today said Larsen & Toubro Electromech LLC
(LTEM), Oman, an associate company, has secured a contract from Petroleum
Development Oman LLC (PDO), Oman. The contract is for revamping and
upgradation of the transmission lines and substations in its existing oil
fields in Central Oman as part of a major infrastructure development
undertaken by PDO. L&T has 65% stake in LTEM.

Car major Maruti Udyog (MUL) climbed 4.2% to Rs 573, extending Friday’s
gain. As per reports, MUL is considering a price increase which will come
into effect in a week to 10 days. 4.9 lakh shares changed hands in the
counter on BSE. The stock had received a battering on the bourses recently

Cigarette major ITC made headway by nearly 4% to Rs 143.25. Volumes in the
stock were high, at 38.4 lakh shares, following speculative activity in the
no-delivery period. HLL rose 3.9% to Rs 176.70.

Tisco rose 3.5% to Rs 417.25, Tata Power rose 4.2% to Rs 448.35, Hindalco
gained 3.3% to Rs 151, Bhel rose 3.3% to Rs 1,137 and HDFC gained 3% to Rs
985.

ONGC rose 3% to Rs 1,020 on reports that it has signed an MoU with Neyveli
Lignite Corporation (NLC) for initiating one of the underground coal
gasification (UCG) pilots in shallower lignite.

State Bank of India (SBI) rose 2.8% to Rs 915. 7.4 lakh shares changed hands
in the counter on BSE. SBI hopes that the new schemes which offer higher
yields than that by foreign banks, will help woo the expatriates in the
India Millennium Deposits, which were raised in 2000 to shore up foreign
reserves and cushion rising oil prices.

Cement scrips advanced on expectation of a hike in cement prices from
October 2005 on the reckoning that the cement demand will pick up due to
pick-up in construction activity. Gujarat Ambuja Cements (GACL) jumped 5.3%
to Rs 73.15. 13.5 lakh shares changed hands in the counter on BSE. ACC
gained 2.5% to Rs 475.

BOC India jumped 12.9% to Rs 190.25. The stock rose on high volume of 26.6
lakh shares.

Stocks like Bank of Baroda (BoB), IDBI, IPCL, Rolta India, Mahindra &
Mahindra (M&M), Jaiprakash Associates, Voltas, Jet Airways, Tamil Nadu
Newsprint (TNPL), West Coast Paper and Gujarat NRE Coke surged.

Rolta India jumped 8.7% to Rs 174.90. 10.9 lakh shares changed hands in the
counter on BSE. BoB gained 6.6% to Rs 240. 2.1 lakh shares changed hands in
the counter on BSE. IDBI rose 5.7% to Rs 122.50. 13.1 lakh shares changed
hands in the counter on BSE. M&M jumped 5.2% to Rs 369. 1.4 lakh shares
changed hands in the counter on BSE. West Coast Paper jumped 8.9% to Rs 355
and another paper manufacturer TNPL gained 4.7% to Rs 89.50.

Blue chips recorded modest to strong gains today on renewed buying interest following firmness in global markets, and drop in crude price


Data showing a surge in FII inflow on Thursday boosted market sentiment.

The Sensex jumped 256.32 points or 3.1% to 8,478.91. This is the biggest
rise in point terms in a single trading session in the barometer index since
last more than one year since 18 May 2004. On 18 May 2004, the Sensex had
galloped 371.86 points to 4,877.02.

18 out of 30 Sensex stocks rose between 3% to 5.3% today. The top gainers
were Gujarat Ambuja Cements (up 5.3% to Rs 73.25), Wipro (up 4.9% to Rs
375), Satyam Computer (up 4.7% to Rs 545), Reliance Industries (up 4.6% to
Rs 783.30), TCS (up 4.2% to Rs 1,472), NTPC (up 4.2% to Rs 106.70), Maruti
Udyog (up 4.2% to Rs 573), L&T (up 4.2% to Rs 1,430), Tata Power (up 4.2% to
Rs 448.35), ITC (up 4% to Rs 143.25) and Hindustan Lever (up 3.9% to Rs
176.70).

ICICI Bank was the only loser among the 30 Sensex constituents.

Small-cap and mid-cap stocks made a comeback. A host of other side counters
rose between 3% to 20% for the day.

Market across the Asia-Pacific and Europe were firm on Monday boosted by a
drop in global crude oil price. US crude fell about $ 1 a barrel on Sunday
(25 September 2005) after Hurricane Rita proved less threatening than
originally feared. Oil was trading at $ 63.35 in early Asian trade, well
below the recent high near $ 68 a barrel.

Data released by Sebi after trading hours on Friday indicated that FIIs
bought shares worth a huge Rs 514.40 crore on Thursday (22 September 2005) –
the day when the Sensex tanked 265 points.

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Small- and mid-cap stocks rebound


The recovery on the bourses was across the board today. A host of small-cap
and mid-cap stocks, besides blue chips, which had received a battering in
the past few days, managed to make their mark again today.

Buying was conspicuous in auto-component, IT, paper, textile, bank, steel
and cement scrips

Stocks like BSL, IFB Securities, FAG Bearings, Megasoft, Gujarat Borosil,
Madhav Marbles, Sah Petroleum, Suashish Diamond, Eveready Industries, Tata
Yodogawa, BOC India, Gujarat Apollo Equipment, Scandent Solutions, Bharati
Shipyard, JK Corporation, Mid-Day Multimedia, Plastiblends, KIC Metaliks,
PSL, Sterling Biotech, Balrampur Chini Mills, Auto Corporation of Goa,
Punjab Alkalies, Indiabulls, Flex Industries, Zodiac Clothing, Andhra
Cement, Harita Seating, Ruchi Soya, Atul Auto, Eimco Elecon, HBL Nife Power,
Insilco, and El Forge rose between 10% to 20%.

A host of other side counters rose between 3% to 10% for the day.

The market breadth was quite strong as gainers outpaced losers by a ratio of
2.7:1. 1,891 scrips advanced on BSE as compared to 697 stocks that declined.
19 scrips were unchanged.

BSE Small-Cap Index jumped 265.23 points or 4.7% to 5,870.69. BSE Mid-Cap
index rose 139.25 points or 3.4% to 4,167.80 points.

Small-cap and mid-cap stocks shrugged off stringent margining norms that
came into force effective from today. 100% upfront margin is payable on over
500 stocks in B1, B2 and S group segments of BSE starting today.

Small-cap and mid-cap stocks were the subject of much upheaval on the
bourses over recent trading sessions.

Over the past few months, this segment of the market witnessed a solid
surge.

Hotel Leelaventure leaped up 5.9% to Rs 268.40 on volumes of 26,385 shares


The stock has appreciated sharply from the close of Rs 225.05 on 25 August
2005 to close at a high of Rs 285.30 on 19 September 2005.

Hotel Leelaventure spurted after it informed BSE that a meeting of the board
of directors of the company will be held on 04 October 2005 to consider
setting up a new hotel at Pune.

Hotel Leelaventure, earlier this month, issued 60,000, 1% Foreign Currency
Convertible Bonds (FCCBs) of Euro 1,000 each aggregating Euro 60 million to
overseas investors.

The FCCBs have a tenor of five years and one day, and are convertible into
equity shares of Rs 10 each at an initial conversion price of Rs 311 per
share at the option of investors. The FCCBs will be listed on the Singapore
Stock Exchange on or about 16 September 2005.

Hotel Leelaventure in July acquired a majority stake in Kovalam Hotels and
has now become a subsidiary of the company and the Beach Hotel owned by
Kovalam Hotels will now be known as ' Leela Kovalam Beach, Kerala'. It did
not specify the consideration for the acquisition but reports in a section
of the media put it at Rs 60 crore.

Hotel Leela Venture reported a net profit of Rs 16.33 crore for Q1 ended 30
June 2005 as compared to a net profit of Rs 0.36 crore in Q1 June 2004.
Income from operations rose 28.5% to Rs 67.53 crore from Rs 52.55 crore

Upbeat turnover projection irons out gains for ION Exchange


ION Exchange is currently up 5.1% to Rs 123.85 on volumes of 33,356 shares.
The scrip traded in the Rs 118.90 and Rs 125.95 range so far today BSE.

The scrip saw a recent rally, up from Rs 94.15 on 25 August 2005 to Rs
145.50 on 16 September 2005. Profit taking emerged at this level and caused
the scrip to retreat to Rs 111.45 on 22 September 2005.

ION Exchange moved strong today following reports that it has set a turnover
target of Rs 150 crore by the end of 2007-2008 for its consumer product
division. This comes along with optimism for the potential in Punjab and
Chandigarh for water purifiers. ION Exchange expects these markets to
contribute at least 22% of total share of consumer product sales over the
next two years.

ION Exchange earlier this month entered into a Joint Venture (JV) with
Belgian major Fifth Element N.V. The JV will concentrate on the areas of
water, and other businesses related to environmental issues.

ION Exchange is a frontrunner in the Indian water treatment sector. It
provides solutions for total water management for industries, homes and
communities. The company forms a select group that has expertise in a range
of technologies, products and services that cover the entire spectrum of
water and waste-water treatment. The company's domestic household segment is
reputed for its Zero-B brand of drinking water purifiers and water
conditioners. The company also also entered the public health sector, urban
and rural, for infrastructural and community level drinking water treatment.

The company's portfolio of products include water, process liquid and waste
water treatment as well as recycling plants, using various physico-chemical
processes for setting, clarification, filteration, disinfection, membrane
and ion exchange technology, ion exchange resins, polymers and
polyelectrolytes for water and non-water processes; boiler, cooling water
and fireside treatment chemicals; Zero-B (bacteria) water purifiers which
provides bacteria-free drinking water instantly, and electrochlorinators for
disinfecting water.

For the quarter ended 30 June 2005, the company turned out a 15% fall in net
profit to Rs 0.46 crore on net sales of Rs 53.23 crore. Net sales increased
by 8%.

Hike in FII limit raises the gears for Shanthi Gears


Shanthi Gears is currently up 2.5% to Rs 55.45 on volumes of 35,455 shares.
The day's trading range was Rs 54 and Rs 55.90 on BSE so far.

The stock witnessed a steady uptrend from the close of Rs 50.25 on 8 August
2005 to close at a high of Rs 60.45 on 17 August 2005. From this level, the
stock drifted lower to close at Rs 53.20 on 22 September 2005.

Shanthi Gears edged higher after its shareholders approved the proposal for
issue of FCCBs up to Rs 70 crore for funding expansion plans. The company’s
shareholders also approved an increase in FII investment ceiling to 40% from
24% of its equity capital.

The company’s total paid-up equity share capital (on a last-reported basis)
is Rs 7.80 crore. The promoters hold a 47% stake in the equity pie of this
engineering company.

Shanthi Gears makes a wide range of power transmission products, including
gears, gear boxes, geared motors and gear assemblies, both standard and
custom-made. Of the company's total business, nearly 50% comprises special
orders.

The company also exports to the US, the UK, the UAE, and Germany.

For Q1 June 2005, Shanthi Gears has reported a net profit of Rs 5.58 crore –
a growth of 41.2% compared to a net profit of Rs 3.95 crore in Q1 June 2004.
Net sales climbed 31.8% to Rs 33.68 crore from Rs 25.54 crore.

Retailing plans have Welspun up a span


Welspun India is currently up 4.1% to Rs 131 on volumes of 10,273 shares.
The scrip traded in a range of Rs 127.95 and Rs 132 on the BSE so far.

The stock has moved up strongly, from Rs 108.45 on 4 August 2005 to Rs
136.35 on 5 September 2005. The scrip was subject to profit taking from here
on, and settled at Rs 125.85 on 23 September 2005.

Welspun India, the flagship company of the Welspun group, which is Asia's
largest and the world's fourth largest producer of terry towels, is
reportedly foraying into home furnishing hyper markets, to be called Home
Clubs. The company has a 60% share of the terry towel market in the US, and
an approximately 22-25% slice of the European market.

Welspun India plans to set up around 15 large stores in different locations
by the end of the year. This is part of the company's Rs 650-crore expansion
plan. Under this plan, it also set up some manufacturing units.

The company hopes to tap the value retail segment with this expansion. Home
Clubs are aimed at being a one-stop shops for all home furnishing
requirements, and every thing sold in these shops be placed before customers
at discounts.

Home Clubs are a part of Welspun group's expansion plan, through which it
aims at more than doubling its turnover in FY07 as against Rs 475 crore in
FY05. Apart from the hyper markets, the group plans to set up about 50
smaller shops.

The first shop in Mumbai is expected to open by the first week of October.
This will be followed by a series of such shops at Delhi, Ahmedabad, Thane
and Lucknow over the next two months.

Presently, the Welspun group has its presence in home textiles ( terry
towels, bed sheets) and speciality yarns. Recently, it entered a joint
venture with Italian company Zucchi for manufacturing bathrobes.

For the quarter ended June 2005, the company turned out a 156% leap in net
profit to Rs 10.80 crore (Rs 4.21 crore). Net sales jumped up 41.6% to Rs
135.37 crore (Rs 95.60 crore).

FCCB/GDR issue approval carries Bilcare upward


Bilcare is currently up 3.7% to Rs 449 on volumes of 5,122 shares. The day's trading range on the counter was between Rs 452.80 and Rs 430 so far. The stock has been contiunuedly moving lower of late, from Rs 535.80 on 18 July 2005 to Rs 428.70 on 22 September 2005 following selling pressure.

Today, however, things were different, as Bilcare announced at its board meet (on 24 September 2005), that the company has approved a US$ 50 million issue of Foreign Currency Convertible Bonds (FCCB)/ Global Depository Receipts (GDR) or equity shares.

The company has decided to set up wholly owned subsidiaries in the US and Europe in the next two years. The company's first foreign subsidiary, Bilcare Pte Ltd, was incorporated in Singapore last year.

Bilcare has a presence in various global markets through its array of customers including Johnson & Johnson, Merck, AstraZeneca and Genome Inc. In the Indian market, clients include names like Dr Reddy's Labs, Ranbaxy, and Nicholas Piramal. The company excels in providing highly innovative and scientific pharma packaging solutions. The company manufactures paper tubes used for winding of polyester and nylon yarn.

Bilcare has future plans to provide value added services in the area of formulation and analytical research and development as well as clinical supplies management to the pharmaceutical sector on a global basis.

At present, the total pharma packaging market in Europe and the US is estimated at $40 billion.

For the quarter ended 30 June 2005, the company turned out a 69% leap in net profit to Rs 8.02 crore (Rs 4.75 crore). Net sales climbed 55.56% to Rs 52.30 crore (Rs 33.62 crore).

Liberal bonus issue has Gangotri Textile flowing up with gains


Gangotri Textile is currently up 5% to Rs 197.80 on volumes of 1,088 shares.

The stock witnessed a solid surge from the close of Rs 109.65 on 21 July
2005 to close at a peak of Rs 238 on 29 August 2005. Here the scrip
witnessed profit taking to close at Rs 188.40 on 23 September 2005.

Gangotri Textile flared up today after its board approved a liberal 1:1
bonus issue. This is the first time the company has declared a bonus issue.
The company’s board also approved a 1:2 stock split.

Gangotri Textile board has drawn up a Rs 350-crore investment plan, and will
also set up an integrated weaving, processing and garment facility.

The Rs 180-crore turnover company, Gangotri Textile, earlier chalked up
plans to strengthen its `Tibre’ apparel brand and is working on an expansion
cum forward integration project covering spinning, weaving, processing and
garmenting facilities with an outlay of Rs 351 crore.

For Q1 June 2005, Gangotri Textile reported 20.4% fall in net profit to Rs
2.14 crore (Rs 2.69 crore). Net sales declined 21.5% to Rs 35.36 crore (Rs
45.08 crore). The company had attributed the fall in turnover to drop in
yarn realisation.

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