Sensex Gains; TCS Net Rises 24%

Chandrasekhar Atreya
16 Jul, 2010
New York City

Stocks in Mumbai traded higher on earnings outlook. TCS reports first quarter profit surged 24%. Technofab Engineering gained 18% on debut. IOL Chemicals soared on preferential issue plan. UTV Software increased 5% on strong first quarter results.

[R]5:00 PM Mumbai, 8:30 AM New York – Stocks in Mumbai traded higher on earnings outlook. TCS reports first quarter profit surged 24%. Technofab Engineering gained 18% on debut. IOL Chemicals soared on preferential issue plan. UTV Software increased 5% on strong first quarter results.[/R]

Stocks in India fluctuated but closed higher leading the benchmark index to a gain for the second week. Software exporters climbed after TCS reported better-than-expected earnings in the first quarter.

The Sensex index in India increased 46.36 or 0.26% to 17,955.82 and CNX Nifty index rose 17.70 or 0.33% to 5,396.45. Among the Sensex 30 stocks, 16 rose and 14 fell.

On BSE trading, 1,671 stocks advanced, 1,195 declined and 102 were unchanged. IT stocks also rose. Realty and banking stocks gained. Reliance Industries edged lower.

Technofab Engineering traded 18% higher to Rs 283.30, from the initial public offer price of Rs 240 per share.

Four tea producers rose 1.7% to 3.92% after the tea board of India said a decline in production due to pest attacks will boost prices.

Rupee edged lower by 10 paisa to Rs 46.70 against one dollar.

Tata Consultancy Services reported a 24.3% increase net profit at Rs 1,906 crore in the first quarter against Rs 1,534 crore a year ago. Revenues were 14% higher at Rs 8,217 crore as against Rs 7,207 crore a year earlier. The company’s operating profit was up 24.6% at Rs 2,245 crore.

Core inflation rate that excludes food and energy costs rose 8.6% in June, Kaushik Basu, Chief Economic Advisor in the Finance Ministry, said in New Delhi today.

The Indian government sold Rs 13,000 crore of bonds today at an auction as planned, said the Reserve Bank of India. The auction was for Rs 5,000 crore of 7.46% notes maturing in 2017, Rs 5,000 crore at 8.2% maturing in 2022, and Rs 3,000 crore of notes at 8.26% maturing in 2027, the Reserve Bank said in its statement.

Indian companies may double their sales of commercial paper this year as new banking rules push the cost of short-term loans upwards, according to Trust Investments Advisors Ltd.

“Offers to arrange for commercial paper sales has risen to almost 10 a day whereas a year ago we wouldn’t have more than one such offer a day,” said Nipa Sheth, a director at the company in an interview from her office in Mumbai yesterday.

The Securities and Exchange Board of India has decided to introduce call auction in the pre-open session in 50 index shares on the National and the Bombay Stock Exchanges.

“To begin with, the session shall be introduced on a pilot basis for the scrips forming part of the Sensex and the Nifty. In case of any change in the composition of Sensex and Nifty, pre-open session shall be introduced for such incoming scrips. Pre-open session shall also continue for the scrips moving out of Sensex and Nifty, though they will not be reckoned for the computation of the index,” the SEBI said in a circular to the stock exchanges on Thursday.

Maruti Suzuki has indicated that its current focus will be more on how to meet the growing domestic market in a capacity-constraint situation and less on the exports market.

“This year we have decided that we will not grow our exports beyond last year’s level due to lack of capacity. We intend to do the same level as last year,” said Chairman, R.C. Bhargava, in Chennai yesterday while he was attending the AGM of Polaris Software Lab.

Gainers & Losers

Ashok Leyland Limited fell 1.2% to Rs 70.65 after turning ex-dividend for a dividend of Rs 1.50 per share for the year ended March 2010.

BASF India Limited fell 0.4% to Rs 456.30 after the company’s first quarter net profit rose 19.0% to Rs 48.86 crore.

Castrol India Limited rose 0.9% to Rs 457.50 after the company’s second quarter net profit rose 17.1% to Rs 150.30 crore.

Cera Sanitaryware gained 1.0% to Rs 272.40 after the company''s board recommended a 1-to-1 bonus issue.

DCM Shriram Industries Limited fell 1.1% to Rs 87.50 after the stock turned ex-dividend today, July 16 for a final dividend of Rs 3 per share for the year ended March 2010.

Honeywell Automation India Limited fell 3.9% to Rs 2,897.40 after the company reported second quarter net profit fell 28.5% to Rs 22.78 crore.

IDBI Bank Limited fell 1.6% to Rs 122.35 after turning ex-dividend for a dividend of Rs 3 per share for the year ended March 2010.

IL&FS Transportation Networks gained 1.5% to Rs 305.80 after the consortium of the company secured a road construction project worth Rs 536 crore.

J.K. Cement Limited fell 2.3% to Rs 178.45 after the stock turned ex-dividend today, July 16 for final dividend of Rs 3.50 per share for the year ended March 2010.

Punjab Alkalies & Chemicals Limited rose 5.5% to Rs 41.20 after the Punjab government said it plans to sell its entire 44.2% stake in the company.

IOL Chemicals and Pharmaceuticals Limited rose 6.7% to Rs 52.25 after the company said its board will meet tomorrow, July 17 to consider issuing preferential shares/warrants to non-promoters.

Tata Consultancy Services Limited added 5.8% to Rs 830 after the top Indian outsourcer beat quarterly forecast and brokerages raised their target price.

Tata Motors Limited climbed 3.3% to Rs 825.75 after the company said sales of all commercial vehicles were 39,975 units. in June 2010, a growth of 38%. Cumulative sales for the fiscal were 111,298 units, a growth of 41%.

Uflex Limited rose 1.8% to Rs 123.80 after the company announced that the board of directors of the company at its meeting held on July 15, has recommended a dividend of Rs 5.00 per share subject to the approval of the shareholders, for the year ended March 31.

UTV Software Communications Limited increased 6.0% to Rs 455.85 after the company reported first quarter net profit of Rs 41.19 crore.