India Morning Report: A dozen successful OFS to close the year

The old logo of Maruti Suzuki India Limited. L...
The old logo of Maruti Suzuki India Limited. Later the logo of Suzuki Motor Corp. was also added to it (Photo credit: Wikipedia)

Last week’s beginnings after NMDC with Reliance Power’s 15 mln shares on offer, were followed by successful closings by Adani Ent(28 mln shares for INR 6 Bln), Eros, Bluedart, Honeywell and even institutional equity sales by Godrej and a PSE sale by Hindustan Copper. 2012 FII purchases have likely exceeded $25 Bln , near the high watermark of $30 Bln in 2010 and wiping out bad news 2011 though India’s Economic recovery is far from incomplete and some indicators even say unlikely to reach 8% again, as for China in the new post crisis developed world economics of a large base and limitations of progress (market expansion) show up. India’s model of the Hindu rate however has shown the fallacy of these being limiting factors and excuses since we took up reforms in 1991 but that was then.

Fixed income yields have not crawled back as fast as they could have after the upbeat

English: Honeywell logo.
English: Honeywell logo. (Photo credit: Wikipedia)

Credit Policy Tuesday but persistently high retail inflation is no longer the limiting cause of India’s problems and neither is a run on Oil prices likely

The Rupee meanwhile is right back up its repair drive crossing back into 55.1 on another start of flat equities to close the year while Maruti and Bajaj Auto climb relentlessly and let ITC and Bharti Airtel scrips slide on lack of interest without hurting the index prospects. Pharma continues to outperform while banks are likely to push for early clearing of margin debt and infraco debt resulting in portfolio sales proposals closing after those holding out for price start staring at

English: Logo of Bharti
English: Logo of Bharti (Photo credit: Wikipedia)

a bleak winter holdout, including those at GMR Infra and LANCO Infra. Why exactly is Lanco scrip moving up today at 10 am?

 

 

India Morning Report: Rebuilding the India Inc dream

The first quarter of profits after 5 quarters growing bottomline by 15% on the index companies a good base price for Gold and a palatable range of Oil prices sounds promising and data enticing enough for one to reconsider the possibility of India growing at its normal clip instead of a sub 6% growth in a not so distant future.

The 110 odd infrastructure projects including low and hgh value road projects and prestigious and commercially groundbreaking ports, gridco and other Infrastructure projects are likely in final stages of a policy intervention currently with the Cabinet. Though they come at the end of a barrage of policy action still awaiting execution and KFA failure is more the current corporate branding influence for India Inc, the execution of these projects could enable by itself a INR 1.1 T in GDP accruals from construction and a likely 10% jump on the nominal and not the real effective GDP at 2004 prices or whichever base year is current.

Banking credit is steady and growing at 15% and if indeed investors still bet on a rate cut at the end of October, then in all probability the only possibility is of an unanticipated market failure and so the markets will have to rise to the occasion without moping much more at 5650. A fall from 5650 to loer level is again only faintly probable after dull days stretch out at least one day after the current series expiry thus the market pre expiry unwittingly again offers great buying opportunities in the otherwise scarce and right valued large cap universe back with good earnings from ITC,IDFC and ICICI BANK to YES BANK, ORCHID and even STRIDE ARCOLAB which has solved the FCCB issues and FX issues in the quarter with realised Net profit hit but not detrimentally to the company’s prospects. Sun Pharma’s issues in the US market also add to the current opportunity for buying and current levels of scerips like HDFCBANK and again ICICIBANK will likely in fact become a bottom for the coming rally which may bide its time till policy announcements including Bank Policy Tuesday are over this month and some of next.(ICICI Bank is up 3% since writing)

 

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