Month: May 2007

It was the top-gainer from the ‘A’ group. Steel companies are expected to post strong results in the March 2007 quarter on the back of higher steel prices. Ispat Industries is yet to announce the date for its March 2007 quarter results.

Mahindra Gesco Developers said the FII holdings in the company has reached 27.47% of the paid-up equity capital, as on 4 May 2007.

Jindal Photo reported a 326.3% growth in net profit in Q4 March 2007 at Rs 9.55 crore (Rs 2.24 crore). Net sales rose 5.7% to Rs 110.32 crore (Rs 104.40 crore). For FY 2007 (year ended 31 March 2007), the net profit rose 41.7% to Rs 27.59 crore (Rs 19.47 crore). Net sales declined 5.4% to Rs 360.67 crore (Rs 381.25 crore). The current price of Rs 110.90 discounts its FY 2007 EPS of Rs 26.89, by a PE multiple of 4.12.

IT stocks have turned volatile in the past few days. After a solid surge to 5,150.28 on 16 April from 4,808.08 on 11 April 2007, owing to Infosys’ strong guidance for FY 2008, the BSE IT Index eased and moved between 4,954 and 5,124 up to 4 May 2007.

The rupee rose to a fresh nine-year high against the dollar on Monday, as the market tested how far the central bank would let it appreciate before intervening. By 9:14 IST, the partially convertible rupee was at 40.5450 per dollar, its highest level since May 1998, and gaining from Friday’s close of 40.8450/8600.

The rupee’s surge is a cause of concern for IT firms, as it directly impacts their revenue and profits, a lion’s share of which is accounted for by exports. At the time of announcing Q4 March 2007 results, Infosys had pointed out that its operating margins will be impacted by about 150 – 160 basis points (bps) due to the rupee’s inflation and by 300 bps on account of wage inflation. The company plans to compensate the impact through improved utilisations, lower losses in subsidiaries and scaled benefit from selling & general as well as administration expenses.

IT companies use the tool of hedging to mitigate risks associated with currency movements. TCS is said to have obtained a $1 billion hedge at a price range of Rs 43.50 – Rs 44. Infosys has a forex cover of $ 470 million. Satyam Computer has hedged a position of $ 460 million with a policy to hedge at least 50% position. Wipro has forward hedge contracts (options & futures) of $195 million at an exchange rate between Rs 44 – Rs 45.77.

GMR Industries said that the High Court of Andhra Pradesh had sanctioned the scheme of arrangement of Bharat Sugar Mills and GMR Ferro Alloys & Industries with the company.
As per the scheme, the company will demerge its ferro alloys undertaking to GMR Ferro Alloys & Industries and amalgamate Bharat Sugar Mills with itself.

Aristocrat Luggage said its board would meet on 14 May 2007, to consider the proposal of amalgamating the company with VIP Industries.

It has been reliably learnt from Insiders that IndiaBulls Financial Services is exiting out of Retail Stock Broking to focus on High Networth Individuals and Portfolio Management Schemes. At the same time, IndiaBulls is venturing into Personal and Auto Loans.

Unitech, along with Videocon and Aditya Birla Nuvo will be included in popular index complier MSCI’s Standard Index series following an annual review. This changes in MSCI’s Standard Index will take effect from the close of 31 May 2007.

MSCI Barra, is a leading provider of benchmark indices and risk management analytics products, and announced changes today for the MSCI Standard Index Series. These changes result from the May 2007 Annual Full Country Index Review.

MSCI Barra’s risk models and analytics products help the world’s largest investors analyze, measure and manage portfolio and firm-wide investment risk.

Arvind Mills, Biocon, Bank of Baroda and Matrix Labs were eliminated from the MSCI Index.