Category: Economy, Markets and Macro Views

Since the beginning of the Year, BSE Sensex companies earnings [hence forth will be referred to as earnings] estimates has undergone a dramatic change with the SENSEX rising as well.

At the beginning, the consensus was earnings would take a dip in FY 2010. However, the tone of Analysts at various Brokerages and Research house started changing and we shall have a look at it and where it stands currently.

All Numbers below are INR Earnings for BSE 30 SENSEX Companies: (more…)

The Indian Industrial production (IP) growth accelerated to 7.8%YoY in June: This compares with a growth of 2.2%YoY (revised downwards from 2.7% earlier) in May and 1.2%YoY in April 2009. While we were expecting industrial production to remain on the recovery path, the growth in June was much above market expectations and our expectations. Infact, the IP growth in June 2009 is highest since February 2008. While we expect sustained recovery in IP growth, the monthly growth numbers do tend to be volatile at times and there could be some retracement in IP growth over the next 1-2 months. (more…)

Despite the wholesale prices based inflation being in the negative zone for more than two months, India’s food prices continue to remain high. As per the latest figures, annual inflation was -1 .58 for the week ended July 25 [Old Data needs to be revamped, total disconnect with current World]. However, it has had little impact on prices of essential food items that continues to soar.

According to an analysis of 14 essential commodities collated by the ministry of consumer affairs, retail food prices have surged 32% in the country in the months of June-July compared to 18% in the corresponding period in 2008. However, WPI based inflation has been negative through most of this period. (more…)

According to press reports, the rain deficit has worsened from 19% of the Long-Period Average till date last week, to 25% now. Data from the IMD suggests that overall shortfall over the June-September period could rise to 15%-18% from the foretasted 8%.

The monsoon is important for India’s agricultural growth given that about 60% of crop land is not irrigated and thus dependent on rainfall. We think that the overall shortfall over the June-September period could rise to 15%-18% from the current 8% shortfall forecast by the IMD. (more…)

JSPL reported consolidated net income for 1QFY2010 at Rs9.9bn, up 123% yoy, in-line with expectations. The steel business delivered an EBITDA of Rs5.6bn. A third consecutive quarter of strong merchant power tariffs (> Rs 6/kwh), gives yet more evidence of the structurally under-supplied nature of Indian power markets. Steel business is on track to deliver volume growth of 30% in FY10E.

JSPL’s new 1,350MW capacity power plant is on track for phased commissioning from Dec 09 onwards and will start contributing to earnings from FY11E onwards. (more…)

We are into the third week of the current reporting season, things still look positive and ahead of expectations, with 1QFY10 profits at 18/29 Sensex companies (excluding -oil) up 12.6% yoy (4% expected). At a still broader level, 178/500 companies have reported 17% yoy growth. There are more positive than negative surprises. (more…)