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FMCG, pharma and IT stocks in demand
Tue, 30 Apr 01:30 pm

Indian share markets lost all their morning gains and hovered around their neutral zone during the post noon trading session. While stocks from the FMCG, pharmaceutical and information technology spaces are leading the pack of gainers, those from the capital goods and realty sectors are amongst the most unfavored.

The BSE-Sensex is trading flat while the NSE-Nifty is down by about 15 points. The BSE Mid Cap and BSE Small Cap indices are trading lower by about 0.2% and 0.5% respectively. The rupee is trading at 54.05 to the US dollar.

FMCG stocks are currently trading firm led by Hindustan Unilever, Colgate and Gillette India. FMCG major Godrej Consumer Products Limited announced its results for the quarter ended March 2013 recently. The company's consolidated net profits surged by about 73% YoY during the quarter. Its revenues, on the other hand rose by about 30% YoY during the quarter. The faster rise in profits was aided by an exceptional gain. On excluding the same, the profits are higher by about 8% YoY. At the operating level, the company margins contracted by 2.4% YoY to 15.1%. The decline was largely due to high marketing expenses for new launches. However, the company expects the result of these expenses over the next few quarters.

Power stocks are currently trading weak led by Lanco Infratech, Reliance Power and Adani Power. As per a leading business daily private sector power major Tata Power is seeking coal assets in the US, Canada and Columbia. The rationale behind doing the same is the on the back of the rise in gas supplies and decline in the fuel's prices. As per the company's management, its plans of acquiring assets in South Africa may not go through on the back of infrastructure concerns. It may be noted that Tata Power had acquired assets in Indonesia for meeting its requirements back in India. However, on the back of the Indonesian government pegging its coal to global benchmark prices, the same became very expensive. And as such some of its projects became unviable. However, with US power generators looking at gas extraction, coal reserves have become relatively free and therefore cheap. While it may be too early to say in terms of prices and acquisition costs, this move would definitely help the company in terms of fuel security.

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