Markets continue to slide

Wed, 27 Apr 01:30 pm

   Previous Close   

   Pre-Open   

   09:30 am   

   11:30 am   

   Closing   

The benchmark indices in the Indian stock market continued to slide in the last two hours of trade. Stocks from banking and realty are trading weak, while those from consumer durables are trading firm.

The BSE-Sensex is down by 106 points while NSE-Nifty is trading 41 points below yesterday's closing. However, BSE Midcap index is trading flat while BSE Small cap index is up by 0.1%. The rupee is trading at 44.46 to the US dollar.

Software stocks are trading mixed with Mphasis and HCL Infosys leading the pack of gainers. The stocks of Wipro and Oracle Financial Services are trading in the red. Wipro has announced the fourth quarter results of financial year 2010-2011 (4QFY11). The company has reported a 6.2% QoQ and 4.3% QoQ growth in consolidated sales and net profits respectively. Growth in sales was driven by all the business segments. The IT services business (76% of total sales) and The IT products business (11% of total sales) registered a growth of 5.7% QoQ and 3.6% QoQ. Its IT services business saw a growth across its segments. One of the key segments, Application development and maintenance, which constitutes 40% of IT services' total sales, grew by 4.4% QoQ during the quarter.

For the year ended March 2011, consolidated sales and net profits grew by 14.5% YoY and 15.3% YoY. According to Wipro Chairman Azim Premji, the Company has made good progress in creating a leaner, simpler and more customer-centric organization structure. He expects that the compan's business strategy along with the new structure will deliver industry leading growth. The company has declared a final dividend of Rs 4 per share (yield of 0.9%), taking total dividend declared for the whole year to Rs 6 per share (yield of 1.3%). The stock of Wipro is trading in the red.

Power stocks are trading mixed as well with NHPC and Coal India leading the pack of gainers. However, GVK Power and Reliance Infra are trading weak. As per a leading financial daily, Tata Power's ultra-mega power project (UMPP) at Mundra should be commissioned by September of this year. This will mark the beginning of 1,600 megawatts of power generation. The existing capacity of the plant is 3,127 MW. It further plans to fully commission the remaining 2,400 MW Mundra UMPP next fiscal. The company plans to add 5,300 MW in the next two years to take it to over 8,500 mega watts (MW). Separately, Tata Motors will commission its 1,050 MW Maithon project in June this year and the entire project is expected to be on stream by the year end. It also plans to add 148 MW in wind energy and 25 MW in solar energy by the end of FY12.

The company currently raised US$ 450 m via hybrid securities, and will use the funds to repay us$ 240 of debt on existing coal assets. The rest will be used to finance coal asset acquisitions in Indonesia and Mozambique.

Tata Power needs US$ 2.2 bn to complete existing projects -- of this it will raise US$ 1.72 bn in debt. The rest will be taken care of by internal accruals. The company is in the process of arranging debt to the tune of US$ 500 m, mainly to expand the distribution business in Mumbai. The stock of Tata Power is trading in the red.