The key Indian stock indices ended lower, extending losses for the second straight day. The BSE Sensex lost 0.4% and the Nifty fell 0.3% while the mid-cap and small-cap indices rose by 0.3% and 0.5% respectively. Bharti Airtel extended its partnership with Ericsson with a $1.3 billion network expansion contract. IRB Infrastructure achieved financial closure for the remaining two of its road projects worth Rs. 775 crores.
1. Market Outlook
India Research
April 01, 2010
Dealer’s Diary Domestic Indices Chg (%) (Pts) (Close)
The key benchmark indices edged lower extending losses for the second straight BSE Sensex -0.4% (62.4) 17,528
day as Asian stocks and US index futures fell. The market was volatile on the Nifty -0.3% (13.4) 5,249
last day of the fourth quarter and the financial year. Stocks surged in early MID CAP 0.3% 16.9 6,806
trade, shrugging off weak Asian stocks. However, the stocks slipped into the red SMALL CAP 0.5% 41.7 8,497
in mid-morning trade. The market re-gained positive zone in afternoon trade as BSE HC 0.7% 39.2 5,328
European stocks edged higher. The Sensex and Nifty lost 0.4% and 0.3% BSE PSU 0.2% 19.3 9,038
respectively, while BSE Mid-cap and Small-cap indices outperformed the BANKEX -0.1% (12.0) 10,652
benchmark indices to end the trading session higher by 0.3% and 0.5% AUTO 0.2% 11.6 7,671
respectively. Among the front-liners, HDFC, Reliance Communications, NTPC, METAL -0.0% (5.5) 17,974
Sun Pharma and HDFC Bank were up by 1-3%, while TCS, ITC, Hero Honda,
OIL & GAS -0.5% (50.5) 10,159
RIL and Hindalco Industries were down by 1-2%. In the Mid-cap segment,
BSE IT -1.2% (62.6) 5,238
Kansai Nerolac, Essar Ship Ports, Asian Star, Honeywell Auto and State Bank of
Bikaner and Jaipur were up by 5-14%, while MVL, Gujarat NRE Coke, REI Six
Global Indices Chg (%) (Pts) (Close)
Ten, Blue Star and Balrampur Chini were down by 4-6%.
Dow Jones -0.5% (50.8) 10,857
Markets Today NASDAQ -0.5% (12.7) 2,398
FTSE 0.1% 7.3 5,680
The trend deciding level for the day is 17572/ 5259 levels. NIFTY trades above
Nikkei -0.1% (7.2) 11,090
this level during the first half-an-hour of trade then we may witness a further
rally up to 17655 – 17783/ 5284 – 5318 levels. However, if NIFTY trades Hang Seng -0.6% (135.4) 21,239
below 17572 / 5259 levels for the first half-an-hour of trade then it may correct Straits Times -1.6% (45.9) 2,887
up to 17444 – 17361/ 5225 – 5201levels. Shanghai Com -0.6% (19.4) 3,109
Indices S2 S1 R1 R2 Indian ADRs Chg (%) (Pts) (Close)
SENSEX 17,361 17,444 17,655 17,783 Infosys -1.5% (0.9) $58.8
NIFTY 5,201 5,225 5,284 5,318 Wipro -0.4% (0.1) $23.3
Satyam -0.4% (0.0) $5.2
News Analysis ICICI Bank -1.7% (0.7) $42.7
Bharti Airtel extends partnership with Ericsson HDFC Bank 2.2% 3.0 $139.4
IRB Infrastructure achieves financial closure for remaining two of its road
BOT projects Advances / Declines BSE NSE
Refer detailed news analysis on the following page. Advances 1,592 716
Declines 1,240 587
Net Inflows (Mar 30, 2010) Unchanged 95 45
Rs cr Purch Sales Net MTD YTD
FII 2,179 1,879 301 18,294 19,270 Volumes (Rs cr)
MFs 466 566 (100) (3,809) (5,818)
BSE 3,874
FII Derivatives (Mar 31, 2010) NSE 13,275
Open
Rs cr Purch Sales Net
Interest
Index Futures 857 1,540 (683) 12,428
Stock Futures 873 995 (122) 27,587
Gainers / Losers
Gainers Losers
Company Price (Rs) Chg (%) Company Price (Rs) Chg (%)
Essar Ship Ports 74 6.7 Guj NRE Coke 88 -4.8
KSK Energy 184 3.6 Balrampur Chini 92 -3.5
Exide Industries 124 3.5 Tech Mahindra 854 -3.4
Ashok Leyland 56 3.2 Lanco Infra. 52 -3.2
Pantaloon Retll 398 3.2 BF Utilities 858 -3.0
1
Please refer to important disclosures at the end of this report Sebi Registration No: INB 010996539
2. Market Outlook | India Research
Bharti Airtel extends partnership with Ericsson
Bharti Airtel and Ericsson further strengthened their strategic partnership with a US$1.3bn
network expansion contract. Airtel users will enjoy an enhanced voice quality and faster
data access with the strengthening of this partnership. The expansion covers introduction of
some of the latest technologies within the wireless world. The agreement will enable Airtel
to put in place a converged network and expanded coverage in rural India. Ericsson will
expand and upgrade Airtels network in 15 of India’s 22 telecom circles. As part of this
contract, Ericsson will supply its industry leading portfolio of energy efficient 2G /2.5G
radio base stations, circuit and packet core, microwave transmission and Intelligent
Network to Bharti Airtel. In addition, it will also ensure that Bharti Airtel’s core and
transport network is ready for 3G rollout thereby reducing time to market and enable the
fast rollout of 3G services at a later date. We maintain Buy on the stock with a Target Price
of Rs406.
IRB Infrastructure achieves financial closure for remaining two of its road
BOT projects
IRB Infrastructure (IRB) is a leader in the Road BOT segment with a portfolio of 16 projects
and a total project capitalization amounting close to Rs10,000cr. Of the 16 projects, 10
are fully operational two are under construction and four have been secured in the recent
past. In one of the latest development, IRB has achieved financial closure for remaining
two of its four recently bagged projects – IRB Talegaon-Amravati Toll way and IRB Goa Toll
Road, by tying up the debt component of Rs475cr and Rs300cr respectively. With this
development, there are no Road BOT projects in IRB’s portfolio which are pending
financial closure. This development needs to be seen in the backdrop of the NHAI’s latest
amendment to Road project bidding norms, wherein a developer will not be allowed to bid
for road BOT projects if it has three or more projects which have not achieved financial
closure. This makes IRB eligible to bid for newer projects going ahead. We have valued IRB
on an SOTP basis. The portfolio of road BOT projects has been valued on an FCFE basis
(Rs149/share), whereas the Construction arm has been valued on an 8x EV/EBITDA basis
(Rs117/share). The Land parcel adjoining the Mumbai-Pune expressway and its
investments in Sindhdurg Airport project have been valued at 1x P/BV (Rs8/share).
We recommend an Accumulate on IRB with a Target Price of Rs274
April 01, 2010 2
3. Market Outlook | India Research
Economic and Political News
February exports surge 34.8% to US$16bn
RBI may raise key rates to check inflation: Citi
Govt. to mobilize 49% equity from mkt. for Kannur airport
Apparel exports dip 14% in January
Corporate News
L&T bags order worth Rs1,017cr in Buildings and Factories segment
Tata Motors converts US$345mn bonds to shares
Compact Disc India promoter hikes stake to 24.7%
KSK Energy commences Power Generation project in Rajasthan
Source: Economic Times, Business Standard, Business Line, Financial Express, Mint
April 01, 2010 3
4. Market Outlook | India Research
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