Sensex surges on FM's comments

The market firmed up further after the finance minister P Chidambaram said there was ample liquidity in the banking system and that steps will be taken - fiscal and monetary, to keep inflation below four percent. He however saw some pressure on food prices. The wholesale price index rose 4.56 percent in the 12 months to Sept. 16, lower than 4.61 percent a week earlier, data showed on Friday.

FM also said that the movement of the country's stock market was orderly.

The market breadth was strong. 1607 shares rose on BSE as compared to 704 shares that declined. 72 shares were unchanged. Gainers outpaced losers by a ratio of 2.2:1.

Select side counters surged. Side counters Facor Alloys (Rs 1.80), Rama Newsprint (Rs 39.79), Prime Securities (Rs 72.35), MIRC Electronics (Rs 23.75), Rico Auto (Rs 84.40), Deep Industries (Rs 35.15), Venky's India (Rs 139.50), ABL Bio-Tech (Rs 61.20), Amforge Industries (Rs 21.30), Maral Overseas (Rs 21.05), Rain Calcining (Rs 37.30), Cubex Tubings (Rs 63), WS Industries (Rs 61.10), Shanthi Gears (Rs 69.25), and Bata India (Rs 219.65) were up by between 6% to 20%.

At 13:26 IST, Sensex was up 93.90 points at 12,474.64

Auto shares firmed up further on expectations of decent to strong sales for September 2006. Car major Maruti Udyog gained 2.4% to Rs 965, Ashok Leyland rose 2.4% to Rs 45.20, Force Motors gained 2.4% to Rs 495, Tata Motors gained 1.7% to Rs 857, M&M rose 1.4% to Rs 677 and TVS Motor rose 1.7% to Rs 125.

Bajaj Auto rose 2.2% to Rs 2,990. After a long haul, the stock hit Rs 3000 level. It hit a high of Rs 3002 in early afternoon trade.

Ranbaxy gained 2% to Rs 439 and international telephony major rose 1.9% to Rs 400.

NTPC rose 1.8% to Rs 130. NTPC has announced that a 210 Mw unit of Feroze Gandhi Unchahar Thermal Power Project — Stage III of the company located in Uttar Pradesh has been successfully test synchronized on 28 September 2006. With the commissioning of this unit, the installed capacity of Feroze Gandhi Unchahar Thermal Power Project has become 1,050 Mw, and the total installed capacity of the company, including those owned through joint venture, has become 26,404 Mw.

Cement shares rose on reports that cement firms have raised prices in the main Mumbai market on an expected pick up in post-monsoon demand. Grasim rose 1.8%, to Rs 2,516, ACC rose 1.2% to Rs 991, Gujarat Ambuja Cements rose 1.6% to Rs 117 and UltraTech Cement gained 1.5% to Rs 900.

Bharti Airtel recovered from lower level after a large block deal was executed in the stock on BSE in the institutional segment at Rs 500 per share in afternoon trade. The stock was up 0.7% to Rs 474.75, off early low of Rs 468.

Pantaloon Retail India was up 2.24% to Rs 1,862.55 a day ahead of its board meet to consider a stock-split.

Prime Securities surged 20% to Rs 72.35 and the stock rose on huge volume of 35 lakh shares.

India's GDP grew 8.9% in the April-June 2006 quarter from a year earlier boosted by manufacturing and services output, data showed on Friday. Agriculture -- which accounts for about 23 percent of GDP -- grew at an annual pace of 3.4 percent in the quarter, compared with 5.5 percent annual growth in January-March 2006. Manufacturing output, which accounts for nearly 15 percent of GDP, expanded by an annual 11.3 percent, faster than the growth rate of 8.9 percent in January-March.

Source: capitalmarket

ICI India jumps on readying tidy sum for inorganic growth

ICI India jumps on readying tidy sum for inorganic growth. ICI India spurted 3.19%, to Rs 349.80, after reports stated that the company's paint business had earmarked Rs 1,500 crore for acquisitions in India. A very thin volume of 845 shares was traded on the BSE.

The stock has marched from a low of Rs 280 on 11 July to Rs 351.05 by 18 September 2006, as buying outpaced selling. Here, the stock slipped to Rs 339 by 28 September, on profit-booking.

At the current market price of Rs 349.80, ICI India trades at 19.54 times its Q1 June 2006 annualized EPS of Rs 17.90.

As per reports, ICI Paints, the paint business of ICI India, will create a corpus of Rs 1,500 crore exclusively for acquisitions in India to rapidly increase market share. The company is looking at acquisitions in two categories – the small local players and one big company – and is already in talk with three or four companies.

The company had recently launched Inspira, a four wall super premium emulsion paint, for the Andhra Pradesh market. The product is targetted at high-end customer segment like hotels, the IT sector and big kothis.

ICI India began buy-back of shares from the open market for up to Rs 131.23 crore, from Friday (29 September 2006). The buy-back will close on 13 September 2007, or on the exhaustion of Rs 131.23 crore, whichever is earlier. The company will pay a maximum price of Rs 350 per share for the buy-back. ICI (India) will utilize up to 25% of its paid up capital and free reserves (as on March 31, 2006) for buy-back.

The buy-back will raise parent ICI Plc's holding from the current 50.83%.

In late June 2006, the company approved sale of its Uniqema business to the Croda group, UK, for Rs 260 crore. The decision was in line with its parent's move to divest the business globally. Operating out of Thane, ICI India's surfactants (Uniqema) business had a turnover of about Rs 130 crore. It has been a highly profitable business for ICI (India).

Over the past decade, ICI (India) has undertaken restructuring, which has seen it get rid of businesses as diverse as fertilisers, agrochemicals, explosives, polyurethanes, industrial paints, trading and nitro cellulose and rubber chemicals.

ICI (India) markets its paints under the brand name Dulux, and is a market leader in refinish segment of the automotive paint industry.

ICI India had registered a net profit growth of 15%, to Rs 18.16 crore (Rs 15.83 crore) for Q1 June 2006. Net sales rose 7%, to Rs 230.17 crore (Rs 215.35 crore).

IndusInd Bank springs on block deal

IndusInd Bank springs on block deal. IndusInd Bank surged 3.46% to Rs 49.40, as 42 lakh shares were bought at an average price of Rs 46 per share in a block deal on the BSE. This amounts to 1.5% of the company's equity. A huge volume of 45.86 lakh shares was traded on the BSE.

The stock, after rising from mid-July to mid-August, turned range-bound. It moved between Rs 42 and Rs 46, and closed at Rs 44.45, on 26 September. Here, the stock advanced 7.42% in two trading sessions, to Rs 47.75 by 28 September 2006. Earlier, the stock had advanced sharply from Rs 30.35 on 19 July, to Rs 47.85 on 18 August 2006.

FII-holding in the company, as on 31 March 2006, stood at Rs 13.39%, while that of other institutional investors was 1.70%. The public holds 24.78% and the promoters' holding is 31.34%.

At the current market price of Rs 49.40, IndusInd Bank trades at 44.90 times its Q1 June annualized EPS of Rs 1.10.

As per recent reports, Indusind Bank was looking out for strategic and a tie-up is likely to happen before the end of the current fiscal. The bank is keen on a long-term player and believes that such an association will benefit the bank. This partnership, though, would be restricted to 5%. This is because RBI does not allow banks to own more than 5% in domestic banks.

On the global front, IndusInd Bank has tied up with two Gulf region banks for expanding its retail banking to garner a larger proportion of NRI customers. The bank had tied up with Union National Bank, UAE, and Doha Bank, Qatar. The bank hopes to leverage its partners' reach influence and to use their branch networks for the distribution of its retail products and services to NRIs.

The bank is also planning to raise Rs 350 crore in upper tier II bonds. The bank, which in 2005 raised Rs 100 crore, may also require to mobilise new Tier 1 capital.

IndusInd Bank is a Hinduja group firm.

IndusInd Bank had registered a decline of 80% in net profit, to Rs 8.01 crore (Rs 40.36 crore) for Q1 June 2006. Net income rose 22%, to Rs 333.82 crore (Rs 273.56 crore).

Source: Capitalmarket