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India Equity Research Reports, IPO and Stock News
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Indraprastha Gas: CNG price hike underscores conviction on margin stability [Amit Murarka]
Indraprastha Gas Ltd (IGL) has raised prices of compressed natural gas by 50 paise per kg in Delhi and by 55 paise in Noida, Greater Noida and Ghaziabad. The new consumer price is Rs 29.8/kg in Delhi and Rs 33.4/kg in Noida, Greater Noida & Ghaziabad. The increase in CNG price is to pass on the increase in the gas cost as higher cost LNG is used to meet growth in CNG and PNG sales, given that allocations of cheaper domestic gas to IGL has now been exhausted.
BHEL: Is BHEL entering steel business as developer or supplier? [Manish Saxena]
Yes, if one were to look at the latest press statement by the Chairman of Rashtriya Ispat Nigam Ltd (RINL). He has suggested that BHEL would be their JV partner for putting seamless steel tube mill and silicon steel mill. This is clearly a surprise to us. To recap, RINL is looking for funds to raise its capacity to 11.5mnt steel plant from current 3mnt - which requires INR 350bn of funds (INR 225bn in debt and rest in equity). According to Mr. Bishnoi's press statement, "RINL hopes to gather INR 105bn needed for the expansion from its internal accruals, IPO and the possible JVs with BHEL and SAIL.”
Maruti Suzuki Limited: Impact of Manesar plant strike limited at this stage [Srinivas Rao]
News reports (Economic Times) indicate that the strike at Maruti's plant in Manesar is still continuing. The strike started on Saturday (4th June) by workers who were demanding recognition of a separate union at the Manesar facility. We note that the Manesar plant has an annual production capacity of 350K vehicles (c1200/day) and constitutes 25% of Maruti's existing capacity of 1.4mn. We believe that the short term impact of this strike will be limited because: Management commentary has indicated that dispatches have not been impacted as yet as they have sufficient stocks at the moment. Maruti's volume run-rate in the first 2 months has been at 100K compared to a capacity of 120K/month.
The Investigator - A short-term buying opportunity [Ajay kapur]
The rare combination of a strong Tape (breadth) in the US equity market and panic in US equity sentiment has now occurred. In the past, this combination has delivered higher returns for both US and Asian equities on a one-, two- and threemonth window, with a higher probability than normal. Parenthetically, the Asian Tape remains quite poor, and sentiment is neutral/bullish – but no matter, the US opportunity should have positive spillover for equities in general in our view.
US Daily Economic Notes : Quantifying the impact of autos on Q2 real GDP [Joseph LaVorgna]
Motor vehicle production will weigh significantly on output this quarter, and the risk is the impact could be even greater than what we have been assuming. As we went through the May employment report in more detail, we observed that motor vehicle hours worked, which have an 85% monthly positive correlation with motor vehicle production in the Fed’s data, were down 3.1%—this follows a -3.8% decline in April.
India Equity Research Reports, IPO and Stock News
Visit http://indiaer.blogspot.com/ for complete details �� ��
Indraprastha Gas: CNG price hike underscores conviction on margin stability [Amit Murarka]
Indraprastha Gas Ltd (IGL) has raised prices of compressed natural gas by 50 paise per kg in Delhi and by 55 paise in Noida, Greater Noida and Ghaziabad. The new consumer price is Rs 29.8/kg in Delhi and Rs 33.4/kg in Noida, Greater Noida & Ghaziabad. The increase in CNG price is to pass on the increase in the gas cost as higher cost LNG is used to meet growth in CNG and PNG sales, given that allocations of cheaper domestic gas to IGL has now been exhausted.
BHEL: Is BHEL entering steel business as developer or supplier? [Manish Saxena]
Yes, if one were to look at the latest press statement by the Chairman of Rashtriya Ispat Nigam Ltd (RINL). He has suggested that BHEL would be their JV partner for putting seamless steel tube mill and silicon steel mill. This is clearly a surprise to us. To recap, RINL is looking for funds to raise its capacity to 11.5mnt steel plant from current 3mnt - which requires INR 350bn of funds (INR 225bn in debt and rest in equity). According to Mr. Bishnoi's press statement, "RINL hopes to gather INR 105bn needed for the expansion from its internal accruals, IPO and the possible JVs with BHEL and SAIL.”
Maruti Suzuki Limited: Impact of Manesar plant strike limited at this stage [Srinivas Rao]
News reports (Economic Times) indicate that the strike at Maruti's plant in Manesar is still continuing. The strike started on Saturday (4th June) by workers who were demanding recognition of a separate union at the Manesar facility. We note that the Manesar plant has an annual production capacity of 350K vehicles (c1200/day) and constitutes 25% of Maruti's existing capacity of 1.4mn. We believe that the short term impact of this strike will be limited because: Management commentary has indicated that dispatches have not been impacted as yet as they have sufficient stocks at the moment. Maruti's volume run-rate in the first 2 months has been at 100K compared to a capacity of 120K/month.
The Investigator - A short-term buying opportunity [Ajay kapur]
The rare combination of a strong Tape (breadth) in the US equity market and panic in US equity sentiment has now occurred. In the past, this combination has delivered higher returns for both US and Asian equities on a one-, two- and threemonth window, with a higher probability than normal. Parenthetically, the Asian Tape remains quite poor, and sentiment is neutral/bullish – but no matter, the US opportunity should have positive spillover for equities in general in our view.
US Daily Economic Notes : Quantifying the impact of autos on Q2 real GDP [Joseph LaVorgna]
Motor vehicle production will weigh significantly on output this quarter, and the risk is the impact could be even greater than what we have been assuming. As we went through the May employment report in more detail, we observed that motor vehicle hours worked, which have an 85% monthly positive correlation with motor vehicle production in the Fed’s data, were down 3.1%—this follows a -3.8% decline in April.
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