Category: Breaking Corporate India Earnings News

Here is a segment-wise breakup of India’s leading equity brokerage houses.

The revenue streams of equity broking firms are undergoing changes, against the background of growing business opportunities and diversified financial services. The major sources of revenue from major players are tabulated below.

Equity Trading:
Brics Securities 85%
Ashika Stock Broking 85%
Motilal Oswal 80%
Arihant Capital Markets 79%
Dalal & Broacha 70%
A F N Langrana Shares 70%
K R Choksey 70%
Zen Securities 65%
Indiabulls 60%

Derivatives Trading:
India Advantage Securities 87%
Crimson Financial 80%
Dolat Capital 60%
Kantilal Chhaganlal 59%
Kunvarji Finstock 59%
R Wadiwala 43%
Angel Broking 43%

Margin Financing
Anand Rathi 8%
Indiabulls 7%
Reliance Money 6%
K R Choksey 4%
Motilal Oswal 3%

E-Broking – Online Trading Marketshare in India
Indiabulls Securities Limited 451,611 clients.
Reliance Money Limited 215678
Motilal Oswal Securities Limited 19065
Unicon Financial Intermediaries Private Limited 13787
Angel Broking Limited 11828
Asit C Mehta Investment Intermediates Limited 9748
SMC Global Securities Limited 7704
Anand Rathi Securities Limited 6793
Doha Brokerage & Financial services Limited 6400
Networth Stock Broking Limited 6120
Bonanza Portfolio Limited 2977
Arihant Capital Markets Limited 2726
Mansukh Securities & Finance Limited 2500
Emkay Share & Stock Brokers Limited 2147
SKI Capital Services Limited 2000
Alankit Assignments Limited 2000

IMPACT ON STEEL INDUSTRY – A DEMAND BOOSTER
We expect the steel industry to be positively impacted because of the significant capex initiatives laid down by the budget. The target for construction of broad gauge lines in 2008-09 is 3500 km (against 2300 km this year). Target for new lines is 350 km at an outlay of Rs.17 bn, gauge conversion – 2,150 km at a capex of Rs.25 bn, doubling of tracks – 1000 km at a capex of Rs.36 bn. The investments are to be directed towards developing the New Delhi, Chhatrapati Shivaji Terminus, Mumbai, Patna and Secunderabad railway stations (Rs.150 bn capex outlay on these stations), setting up diesel loco, electric loco and rail coach factory at an estimated cost of Rs.40 bn, and towards container trains, container depot and multi-modal logistics parks (Rs.20 bn).

Stainless Steel and Ferro Alloys to be the major beneficiaries.22.9 tons axle load stainless steel wagons will be manufactured from 2008-09 instead of manufacture of 20.3 tons axle load BCN and BOXN wagons.

IMPACT ON FIRE PROTECTION EQUIPMENT INDUSTRY
The Railway Budget has proposed to set up on pilot project basis installation of fire detection, prevention and protection devices. Once this project is successful it would be implemented on all the coaches. This could translate into potential business of Rs.7 bn.

Nitin Fire protection is the leading player in this area and if the project is successful it would stand to benefit significantly.

IMPACT ON LOGISTICS INDUSTRY
Construction of the dedicated rail freight corridor to commence in FY09. Setting up terminals on railway land. Focus on port connectivity. Wagon leasing and investment policy. With a lot of thrust on increased freight traffic, availability of container depots near railways stations and commencement of work on dedicated freight corridor the Railway Budget is positive for companies like Concor and Gateway Distriparks.

IMPACT ON CEMENT INDUSTRY
Increased loading target of 200 MT from cement industry by 2011-12. No across the board increase in freight rates. Reduction in freight rate for fly ash by 14%.

IMPACT ON CAPITAL GOODS INDUSTRY
Procurement of rolling stock. Indian Rail Bijli Company Ltd, a JV with NTPC to set up 1000 MW thermal power plant at Nabinagar, Bihar. MUTP Phase II to be started at a cost of Rs.50 bn, financed jointly by Railways and State Government of Maharashtra, with multi-lateral funding. Among likely beneficiaries would be Siemens India, which has received several orders for propulsion systems, traction motors and other electrical equipment under the “Mumbai Rail Vikas Corp”.

State owned Power Grid Corporation of India [PGCIL] will replace Bajaj Auto in the National Stock Exchange of India’s benchmark NIFTY-50. This is a very prestigious entry for PGCIL.

The PGCIL stock has shot up 9% to trade at Rs 112.00

Q4CY2007 results of SEAMEC have been disappointing. The revenues declined by 64% year on year (yoy) to Rs22.3 crore from Rs61.6 crore due to lesser deployment of vessels. The company suffered a net loss of Rs15.9 crore during the quarter as against the net profit of Rs25.9 crore during Q4CY2006 on account of lower revenue generation and higher dry docking expenses.

During the quarter, SEAMEC III was the only vessel that was fully deployed, while SEAMEC II and SEAMEC IV were not operational due to up-gradation or repair work for longer duration than expected. SEAMEC I was also under-utilised due to premature termination of contract.

SEAMEC II to be out of operations for a minimum of six-month duration and delay in up-gradation of SEAMEC IV, we expect the company’s performance to suffer during H1CY2008.

Delhi based Amtek Auto has informed us that the company has entered in to an MOU with the aim to set up a 50/50 joint venture with American Railcar industries, a North American leader in railcar manufacturing.

The signing of MOU is part of the Amtek Auto strategy to diversify by the setting up of the company’s Amtek Transportations systems division and this joint venture will be part of that new division which signals a major investment by the Amtek into this new and exciting market. The transportation division, which includes railways, aerospace and surface transportation system, will have within the next 4-5 years growth to around Rs 1,500 crore in sales and will give a good balance for the Amtek with it already highly successful automotive division. Amtek is currently investigating other potential opportunities and acquisition for the transportation division both in USA and European markets.

The Bombay High court has approved the scheme of demerger – which splits BJAT into three entities: Bajaj Auto Limited, Bajaj Holdings and Investment Ltd and Bajaj Finserve Ltd. BJA stated in a filing with the exchange that the ‘effective date’ and ‘record date’ are yet to be fixed.

Bajaj Auto will demerge its businesses into three entities
a) Bajaj Auto Ltd. (auto businesses + Rs15bn in cash);
b) Bajaj Finserve Ltd. (windpower projects, investments in the insurance ventures, investment in Bajaj Auto Finance and Rs8bn in cash);
c) Bajaj Holdings and Investment Ltd (residual cash, investment in ICICI and 30% stake in both Bajaj Auto and Bajaj Finserve).

All current shareholders of Bajaj Auto will get 1 share each of the new businesses (for every 1 share held in Bajaj Auto).