Earlier BOFA-Merrill in its expectations for 2010 has said it will be the year of consolidation. In continuing its coverage on equity strategy for 2010, Merrill advises investors to pick cherries. Since company and sector performances are growing more differentiated, suggesting the market is responding less to macro economic news and more to business specifics. Thus, adopt a stock-specific approach for portfolio construction in 2010. (more…)
Author: CP
Airlines – Take Off Strong in November
Indian airline passenger traffic recorded a strong 29.8% YoY growth during the month of November. This concurs with our view of strong traffic growth for the industry for FY10 and FY11. Despite slightly lower market share MoM, Jet Airways (including subsidiary JetLite) has retained its leadership in terms of market share.
Expect industry-wide yields to improve due to a restricted increase in supply and improving traffic. Yields have already seen an industry wide increase of +20% on the back of fare hikes done by the carriers. Better seat factors should also enable sector to improve margins and return to profitability.
The current softening of crude prices would enable the industry including Jet Airways and SpiceJet to post strong numbers for the month of December.
Implications of Moody’s Revised Ratings on Outlook for India
International rating Agency, Moody’s has revised the rating for India’s Economic Outlook.
- The local currency sovereign bond rating at Ba2, Moody’s has revised the outlook from stable to positive.
- Foreign Currency Bank deposits ratings have been raised from Ba2 to Ba1
Implications of the Revision – The ratings still remain below those of S&P/Fitch. The
changes are a reflection of (a) India’s strong growth prospects (b) its robust external position and (c) its demonstrated ability to withstand the global financial crisis.
Here is the complete Guide to Moody’s and S&P / Fitch Rating
Investment Grade:
Moody’s: Aaa, Aa1, Aa2, Aa3, A1, A2, A3, Baa1, Baa2, Baa3
S&P/Fitch: AAA, AA+, AA, A+, A, BBB+, BBB, BBB
Non-Investment Grade:
Moody’s: Ba1, Ba2, Ba3, B1, B2, B3
S&P/Fitch: BB+, BB, BB-, B+, B, B
As Indian citizens, it hardly matters to us about these ratings since we have stronger faith in the Discplined and Ethical Central Bank, the RBI which has saved India from crisis.
One can always argue that these ratings decide the FII flow, but the Indian Insurance / Pension scheme have become a driving force in the market, can you believe it ?
Advance Tax 3rd Q 2009-2010
Here is Breaking News about Advance tax by various Indian Corporates for Q3 FY 2009-10. Those paying lesser advance tax have been highlighted in Red.
Tata Motors pays Rs 100 crore versus Nil (YoY)
M&M pays Rs 195 crore versus Rs 4.5 crore (YoY)
Tata Steel pays Rs 650 crore versus Rs 260 crore (YoY)
Hindalco pays Rs 100 crore versus Rs 40 crore (YoY)
HUL pays Rs 200 crore versus Rs 155 crore: Sources
L&T pays Rs 270 crore versus Rs 312 crore (YoY)
Grasim Q3 advance tax at Rs 150 crore versus Rs 75 crore: Sources
UltraTech pays Rs 90 crore versus Rs 65 crore (YoY)
HDFC Q3 advance tax at Rs 320 crore versus Rs 280 crore: Sources
Dena Bank pays Rs 65 crore versus Rs 60 crore (YoY)
IndusInd Bank pays Rs 65 crore versus Rs 22 crore (YoY)
Bank Of Baroda pays Rs 330 crore versus Rs 220 crore (YoY)
Bank Of India pays Rs 102 crore versus Rs 370 crore (YoY)
Tata Power pays Rs 81 crore versus Rs 29 crore (YoY)
Tata Chem pays Rs 40 crore versus Rs 83 crore (YoY)
Indian Oil Q3 advance tax nil versus Rs 1,100 crore (QoQ)
BPCL Q3 advance tax at nil
Central Bank pays Rs 138 crore versus Rs 163 crore (YoY)
Bajaj Auto pays Rs 320 crore versus Rs 105 crore
Adani Enterprises – Logistics + Energy Holdings
Adani Enterprises Limited (AEL) is the primary vehicle for the Adani Group’s businesses, with execution being its key strength. It is India’s largest coal trader and owns the country’s highest-selling edible oil brand. The group also built India’s largest private sector multi-product port [MSEZ – Mundra Port].
AEL expects to undertake contract mining for 1.7bn tonnes of coal over a 30-year period. Out of 70mtpa, it has signed contracts for 10mtpa, letters of intent (LOI) for 35mtpa and in-principle approvals for 25mtpa. (more…)
WPI nears 5% – Rising Faster than Markets
India’s WPI inflation rose more than expected by 4.78% y-o-y in November from 1.34% in October. On a seasonally adjusted MoM basis, inflation was up 2.2% v/s 0.4% last month. Given the current uptrend, inflation could likely cross 6% in December and 8% by March 10.
Growth was led primarily by Primary Articles (+11.8% YoY), with food being the major driver (+16.7%). Within this category, key commodities driving prices were pulses (more…)