Thursday, October 20, 2005

Sensex closes 36 pts down after 297 pts swing

Markets lost further ground on Thursday and the BSE Sensex closed below 7950
level after an intra-day swing of almost 297 points.

The BSE Sensex closed 35.94 points down at 7,935.12, after hitting an
intraday low of 7,838.02.

The NSE Nifty closed 17.00 points down at 2,395.45 after hitting an intraday
low of 2,363.55.

The markets opened today on a firm note on the back of positive global cues,
which provided enough reason for market participants to take advantage of
the near 10% correction over the last couple of weeks and do some bottom
fishing. However, bears slowly and steadily increased their might as the
trading day progressed

The BSE Sensex gained more than 160 points after opening 104.76 points up at
8,075.82. The NSE Nifty also moved up sharply after opening 8.95 points up
at 2,421.40.

There was intense selling pressure witnessed in non-large-cap stocks today,
as is evident from the losses in the BSE Mid-cap and small-cap indices of 2%
and 3% respectively. The market breadth today was totally in favour of the
losers, as they outnumbered the gainers in the ratio of 6:1 on the BSE.

Some small- and mid-cap stocks were boosted due to strong Q2 results. Stocks
like KPIT Cummins Infosystems, Fag Bearings, CRISIL, Thirumalai Chemicals,
Allsec Technologies, and Infotech Enterprises, made headway on the back of
strong Q2 results

Among the Sensex stocks 12 stocks ended on the positive side as compared to
18 stocks which ended in red. Major gainers on the BSE include Satyam (up
5%), Reliance energy (up 3.2%), Gujarat Ambuja (up 1.5%), TCS Ltd (up 1.4%)
and Infosys (up 1.3%). Major losers included Tata Power (down 5.4%), ITC
(down 4%), Ranbaxy (down 3.4%), BHEL (down 3.3%) and Hindalco (down 3.3%).

JK Tyres to expand Mysore facility

Tyre manufacturer JK Industries plans to expand its Mysore facility to
quadraple its production of bus and truck radials there to 15 lakh tyres per
annum in five years by investing Rs 180 crore, a senior company executive
said on Thursday.

The company's General Manager, Sales & Marketing, Vikram Malhotra, told
reporters here that it would invest Rs 60 crore in alternate year to scale
up the capacity from the current 3.7 lakh tyre per annum in Mysore by
September 2010.

The company which manufacturers tyre brands JK Tyre and Vikrant, plans to
set up ten more tyre care centres in the country, taking the total number to
27 by March/April next year, Malhotra added.

He said JK Industries, the flagship company of the JK Group, also proposed
to manufacture tyre for light commercial vehicles at its Mysore facility.

According to Malhotra, prices of bus and truck radials are likely to go up
by 2-3 per cent next month due to rise in input costs. JK Industries claims
an 85 per cent marketshare in the bus/truck radial segment in the country.

Hero Honda rose 1.6% to Rs 699 in volatile late trading on the back of strong Q2 results

1.3 lakh shares changed hands in the counter on BSE.

The stock has witnessed high volatility recently due to alternate bouts of
buying and selling.

Taking cue from robust Q2 results from Bajaj Auto, Hero Honda scrip rose
nearly 4% in two trading sessions between 17 October 2005 and 18 October
2005 to Rs 716.55 from its close of Rs 689.05 on 14 October. On 19 October
2005, the scrip lost 4% in a single trading session in a weak market to Rs

Hero Honda's net profit spiraled up 23% in Q2 September 2005 to Rs 238 crore
(Rs 194 crore). Total turnover (net of excise) rose 22.8% to Rs 2209.36
crore from Rs 1798.23 crore, on the back of strong volume growth. The
results hit the market at the fag end of the trading session.

Hero Honda posted a 21% growth in motorcycle sales in Q2 September 2005 on
the back of strong rural sales and a good response to its newly launched
125cc motorcycles Glamour.

CRISIL surges on robust Q2 results

CRISIL jumped 5% to Rs 1,310 on the back of a surge in Q2 September 2005 net

3,906 shares changed hands in the counter on BSE.

Ahead of the results announcement, the scrip lost 2.4% on Wednesday (19
October 2005) in a weak market to Rs 1,247.65.

CRISIL’s consolidated net profit has jumped 163.7% in Q2 September 2005 to
Rs 14.11 crore from Rs 5.35 crore in Q2 September 2004. Top line growth has
led bottom line growth. Consolidated income from operations has risen 74.3%
to Rs 51.52 crore from Rs 29.55 crore.

CRISIL has become a subsidiary of global rating agency S&P after S&P made an
open offer to acquire control over the company.

Sensex flops from earlier highs

The market moved down from the higher level in early afternoon trade. Stocks
like HDFC, Cipla, and Grasim Industries moved downward. Tata Motors lost
major ground from the higher levels. State Bank of India, Bhel, ITC, Tata
Power, Hindalco Industries, and Bajaj Auto slipped into the red.

Stocks like Ranbaxy, Reliance Industries, Bharti Tele-Ventures, Tisco, ACC,
and ONGC shrugged off the higher level.

Market breadth turned negative. 1,390 stocks declined on BSE as compared to
926 stocks that rose. 42 scrips remained unchanged. Losers outpaced gainers
by a ratio of 1.5:1. In morning trade, the breadth was strong with more than
one gainer for every loser.

Stocks like Wockhardt, Galaxy Entertainment, Hind Rectifiers, Champagne
Indage, Astra Microwave Products, Hindustan Organic Chemicals, Shree Rama
Multi-Tech, NDTV, Sutlej Industries, WPIL, Lakshmi Precision Screws, Jet
Airways, Godavari Fertilizers, SRF, Raasi Refractories, Igarshi Motors, SKS
Ship, Andhra Cement, Vibra Automotive, Panjon, Liberty Shoes, Asian
Electronics, Reliance Industrial Infrastructure, and Patel Roadways were in
the negative.

At 12:12 IST, the Sensex was up 39 points at 8,010. The Sensex came sharply
off the day’s high of 8,134.84.

The Sensex had marched up over 150 points within minutes of commencement of
trading, taking cue from the recovery across global markets. It came off the
higher level later.

Housing finance major HDFC lost 3% to Rs 945.10, Grasim shed 2.3% to Rs
1,121, and Cipla shed 1.9% to Rs 375.

SBI lost 0.2% to Rs 887 and ITC shed 0.7% to Rs 119.70.

Reliance Industries was up 0.3% to Rs 750.60 – off the day’s high of Rs
761.80. 9.2 lakh shares changed hands in the counter on BSE.

Ranbaxy was flat at Rs 411. The stock came off the day’s high of Rs 423. 2.6
lakh shares changed hands in the counter on BSE. Ranbaxy said on Wednesday
that trials showed that a malaria treatment drug it was developing jointly
with the Geneva-based Medicines for Malaria Venture reduced the malarial
parasite count.

Satyam Computer surged 5.4% to Rs 587.70 after the company reported strong
Q2 results and revised upwards its FY 2006 EPS and revenue guidance. 23.8
lakh shares changed hands in the counter on BSE.

Satyam’s consolidated net profit as per Indian GAAP climbed 34% to Rs 237.33
crore from Rs 176.86 crore in Q2 September 2004. Net sales rose 33.9% to Rs
1,154.96 crore from Rs 862.08 crore. The rise in net profit was partly due
to a surge in other income by 31.6% to Rs 31.55 crore from Rs 23.97 crore.
Both net profit and sales have beaten market expectations.

Satyam Computer expects EPS for FY 2006 at between Rs 29.12 and Rs 29.23,
implying a growth rate of 30.0% to 30.5%. The company expects revenue as per
consolidated Indian GAAP financials to be between Rs 4,700 crore and Rs
4,718 crore, implying a growth rate of 33.5% to 34.0%.

Hero Honda rose on expectation of strong Q2 results. The scrip gained 1.3%
to Rs 697. The stock has witnessed high volatility in the past few days due
to alternate bouts of buying and selling. Hero Honda unveils Q2 results


Shanthi Gears plummeted 4% to Rs 53 following a muted bottom line growth for Q2

73,727 shares changed hands in the counter on BSE.

The company reported a 9% growth in Q2 September 2005 net profit to Rs 4.80
crore from Rs 4.40 crore in Q2 September 2004. Net sales rose 29.9% to Rs
35.67 crore from Rs 27.44 crore. Operating profit margin declined to 34.51%
from 36.6% in Q2 September 2004.

On a sequential basis, net profit declined 13.9% from Rs 5.58 crore in Q1
June 2005. The tax provision was lower at Rs 1.81 crore in Q1 June 2005
which was why there was a drop in net profit on a sequential basis in Q2
September 2005. The tax provision in Q2 September 2005 was at Rs 3.63 crore.
Sales rose 5.9% on a sequential basis from Rs 33.68 crore in Q1 June 2005

Shanthi Gears manufactures a wide range of power transmission products,
including gears, gear boxes, geared motors and gear assemblies, both
standard and custom-made. Nearly 50% of the company's business involves
special orders. The company also exports to the US, the UK, the UAE, and

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