01 February 2011

Buy Marico: High copra prices hit margins, volume growth strong: ICICI Securities

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High copra prices hit margins, volume growth remains strong… 

Marico’s Q3FY11 results were in line with our estimates with sales
growing by 22.1% to | 817.8 crore led by ~15% volume growth and ~7%
price led growth. EBITDA margin dipped by 260 bps to 12.2%, led by
higher raw material cost. Raw material cost increased from 39.2% of the
sales in Q3FY10 to 43.1% in Q3FY11 due to higher copra and rice bran
prices. Interest cost increased by 19.5% to | 7.6 crore and other income
increased by 21.2% to | 6.9 crore during the quarter. Net profit rose by
10% to | 69.5 crore on the back of higher EBITDA and other income.

Buy Grasim VSF on strong footing, upgrade estimates; Anand Rathi

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Grasim
VSF on strong footing, upgrade estimates; maintain Buy
Grasim’s 3QFY11 results beat our estimates due to its strong VSF
realization, expected to be firm in the near term. We raise our
FY11e/ FY12e net profit 14%/12%, factoring in strong VSF
performance; we introduce FY13 estimates. Robust VSF outlook
and narrowing of the holdco discount (45% now) are short term
triggers. We raise our target price to `2,750 from `2,680 earlier.

Disappointing results… Jaiprakash Associates :: ICICI Sec

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Disappointing results… 
Jaiprakash Associates (JAL)’s Q3FY11 results were well below our
expectation due to disappointing performance from the construction
segment led by slower execution at Yamuna Expressway due to
agitation. We highlight that JAL’s  construction business continues to
remain volatile and now its net current order book also stands at | 5000
crore. We have now valued JAL at  | 90/share based on the SOTP
valuation methodology and recommend an ADD rating.

Anand Rathi: Tata Teleservices (Maharashtra) Aggressive cost-control offsets revenue miss in 3QFY11

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Tata Teleservices (Maharashtra)
Aggressive cost-control offsets revenue miss in 3QFY11
TTML’s 3Q revenue belied our estimate by 4%. EBITDA, however,
was ~9% higher, following the aggressive reduction in sales and
marketing expenses. Contrary to our expectations, TTML has not
yet started charging amortization of 3G spectrum fee and interest
on 3G loans to the P&L. As a result, net loss fell qoq to `796m as
against our estimate of qoq increase to `1.3bn.

SUN TV NETWORK Blockbuster movie; core biz does well in spite of high base: Edelweiss

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􀂃 Revenue up 51% Y-o-Y; robust growth across businesses
Sun TV Network (Sun TV) reported Q3FY11 revenue of INR 5,980 mn against our
estimate of INR 5,673 mn. Ad revenue grew 16% Y-o-Y over a lower base, as
last year festive season overlapped Q2. Broadcast fees jumped 20% Y-o-Y.
Subscription revenue growth was driven by 59%, 36%, and 43% Y-o-Y growth in
the DTH, cable, and international subscription revenue streams, respectively.
Sun TV has earned revenues of INR 1,790 mn from the release of ‘Enthiran’ in
Tamil and ‘Robot’ in Telugu and Hindi (INR 130 mn was booked in Q2FY11, INR
1,510 mn in Q3FY11, additionally, INR 150 mn is expected from satellite rights,
which hasn’t been included in Q3FY11 revenues). INR 1,320 mn was spent on
the production of the movie.

Kotak Securities: INDIA DAILY News Update: February 1, 2011

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Economy News
4 Even as Vedanta was facing acute bauxite shortage for its 1 million tonne
per annum (MTPA) refinery after the Centre rejected mining plan at
Niyamgiri, a joint venture firm today urged Orissa government to
expedite its Rs 200 Bn proposals in aluminium and power sectors. (BS)
4 The government approved a Rs 80 Bn subsidy to the three public sector
oil marketing companies to compensate half the revenues they lost on
selling diesel, domestic LPG and kerosene below cost for the quarter
ending December 31. (BS)

UBS: Market Strategy- Indian stocks may correct further

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UBS Investment Research
India Market Strategy
Indian stocks may correct further
􀂄 Several concerns worry investors
Nifty and Sensex have fallen by 10% 2011 ytd on concerns such as high inflation,
high crude oil prices, lack of progress in govt reforms, fear of populist moves by
Indian govt in the wake of 5 state elections scheduled in May. We believe that
while higher inflation may be partly priced, we are yet to see significant selling by
foreign institutional investors yet. FII selling can take markets down by 10%-15%
more, in our view. We will see any decline in stock prices as a buying opportunity
to invest in attractively priced growth stocks.

Lakshmi Machine Works- Margin pressures on increased competition: Emkay

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Lakshmi Machine Works
Margin pressures on increased competition


ACCUMULATE

CMP: Rs 2,138                                       Target Price: Rs 2,660

n     Q3FY11 PAT of Rs458mn in line with our estimates led by better than expected rev. growth and higher other income
n     EBITDA margin down 346bps yoy to 15.4% due to significant increase in raw material price
n     Strong demand for yarn continues to attract capex resulting in LMW’s order book rising to Rs41bn from Rs36bn in Q2FY11
n     Post recent price correction -upgrade rating to ACCUMULATE from HOLD. Valuations at 15.4x /13.7x EPS of Rs139.2 /156.2 for FY11/12E

Auto Sales Update - strong beginning to the year:: Edelweiss

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n  Hero Honda: Steady volumes
Hero Honda’s (HH) volumes, at 466,524, rose 14% Y-o-Y but dipped 7% M-o-M. We note, however, that the sequential decline was on a higher base (December volumes had been unusually strong on account of restocking). As per the agreement between HH and Honda Motor Company, three new products will be introduced till 2014.

TRF - Regains lost ground, Retain Accumulate:: Emkay

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TRF
Regains lost ground, Retain Accumulate


ACCUMULATE

CMP: Rs 504                                        Target Price: Rs 586

n     TRF regains lost ground – posted standalone net profit of Rs174 mn (Vs estimate of Rs80 mn. But, auto business posted net loss of Rs7 mn (Vs net profit of Rs19 mn)
n     Order book at Rs18 bn (-8% qoq) – with NO order wins in Q2FY11 and Q3FY11. Strong order bid pipeline – finalization can spillover in Q1FY12E
n     TRF expects momentum to begin from Q4FY11E and continue in FY12E  – led by execution in large NTPC project orders and commencement of new capacities in Auto business
n     NOT upgrading rating, despite price correction – looking at cues for earnings upgrades. Until then retain ACCUMULATE rating with revised price target of Rs586/Share (10X FY12E)

External Trade - trade deficit continues to shrink:; Edelweiss

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n  Trade deficit shrinks for third consecutive month
In December, India’s trade deficit shrank substaintially to USD 2.6 bn compared to USD 8.9 bn in October and USD 11.8 bn in same month last year. This is the lowest deficit in almost five years. Average monthly trade deficit so far in the current fiscal stands at ~USD 9.5 bn. Once again, improvement in exports and dip in oil imports compared to previous month led to the decline. Meanwhile, non-oil trade balance moved into surplus zone for the first time since March 2009.

FII & DII trading activity on NSE and BSE as on 01-Feb-2011

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FII trading activity on NSE and BSE on Capital Market Segment
The following is combined FII trading data across NSE and BSE collated on the basis of trades executed by FIIs on 01-Feb-2011.
FII trading activity on NSE and BSE in Capital Market Segment(In Rs. Crores)
CategoryDateBuy ValueSell ValueNet Value
FII01-Feb-20112853.093889.89-1036.8
 
 
Domestic Institutional Investors trading activity on NSE and BSE on Capital Market Segment
The following is combined Domestic Institutional Investors trading data across NSE and BSE collated on the basis of trades executed by Banks, DFIs, Insurance, MFs and New Pension System on 01-Feb-2011.
DII trading activity on NSE and BSE in Capital Market Segment(In Rs. Crores)
CategoryDateBuy ValueSell ValueNet Value
DII01-Feb-20111779.341148.94630.4
 

FII DERIVATIVES STATISTICS FOR 01-Feb-2011

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FII DERIVATIVES STATISTICS FOR 01-Feb-2011 
 BUYSELLOPEN INTEREST AT THE END OF THE DAY 
 No. of contractsAmt in CroresNo. of contractsAmt in CroresNo. of contractsAmt in Crores 
INDEX FUTURES1052242874.26786762144.5342322611447.32729.73
INDEX OPTIONS3220608740.712825227718.31172827646804.681022.40
STOCK FUTURES693501794.51691691791.39114985927927.093.12
STOCK OPTIONS18367492.6719203512.7618279473.39-20.08
      TOTAL1735.16

 

BSE, Bulk deals, 1/2/2011


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Scrip Code
Company
Client Name
Deal Type *
Quantity
Price **
531678
Anand Credit
PARMAR BHARATKUMAR B
B
44697
9.71
531448
Arrow Sec
PARMAR BHARATKUMAR B
B
58603
11.72
531448
Arrow Sec
PCJ FINVEST PVT LTD
S
40000
12.00
532435
Asia HR Tech
TELESYS SOFTWARE LTD
S
60000
5.92
511664
BGIL Films
BALWANT SINGH BISHT
S
32575
5.61

NSE, Bulk deals, 01-Feb-2011

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Symbol
Security Name
Client Name
Buy / Sell
Quantity Traded
Wght. Avg. 
Price
CANFINHOME
Can Fin Homes Ltd
RAJEN CHANDRAKANT SHARE A/C
BUY
1,30,639
117.43
CANFINHOME
Can Fin Homes Ltd
RAJEN CHANDRAKANT SHARE A/C
SELL
1,17,448
116.30
CMAHENDRA
C.Mahendra Exports Ltd
CROSSEAS CAPITAL SERVICES PVT. LTD.
BUY
18,47,556
161.35
CMAHENDRA
C.Mahendra Exports Ltd
CROSSEAS CAPITAL SERVICES PVT. LTD.
SELL
18,47,556
161.81

FII & DII Turnover (BSE + NSE) 1/2/11

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FII & DII Turnover (BSE + NSE)
(Rs. crore)
FIIDII
Trade DateBuySalesNetBuySalesNet
1/2/112,853.093,889.89-1,036.801,779.341,148.94630.40
31/1/112,599.843,520.22-920.382,064.481,056.341,008.14
28/1/113,481.284,188.12-706.841,769.191,687.9581.24
Feb , 112,853.093,889.89-1,036.801,779.341,148.94630.40
Since 1/1/11   *