Auto and Realty Stocks in Favor

Wed, 4 Nov 11:30 am

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   09:30 am   

   01:30 pm   

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After opening on a firm note, the Indian Markets continued to trade positively. Sectoral indices are trading on a firm note with stocks from the auto, consumer durables and realty sectors leading the gainers.

The BSE-Sensex is trading up 114 points (up 0.4%) and the NSE- Nifty is trading up 26 points (up 0.3%). The BSE Mid Cap index is trading up by 0.5% while the BSE Small Cap index is trading up 0.4%. The rupee is trading at 65.58 to the US$.

Most of the engineering stocks are trading on a positive note with Jain Irrigation and BGR Energy leading the gainers. Engineering major ABB India Ltd has reported its results for the third quarter ended September 30, 2015.

During the quarter, the company has posted 30% rise in its profit to Rs 587 million on a YoY (year-on-year) basis. The growth was on the back of higher volumes, favorable exchange rates and improved efficiency. Total income from operations rose 6.7% YoY to Rs 19.7 billion.

Most of company growth was aided by higher order inflow. New orders rose 61.3% YoY during the quarter. It was reported that that the company has won orders worth Rs 22 billion during the concerned period. This took the company's total order book to Rs 82.8 billion in September. The company accredited this trend to value addition in its portfolio of advanced and integrated solutions. Lastly, the company for its future prospects stated that it will carefully optimise cost and cash in a market which continues to remain uncertain in its outlook.

Presently, the stock of ABB India Ltd is trading down by 0.4% on the BSE.

As per an article in Firstpost, the Reserve Bank of India (RBI) has fixed the public issue price for the sovereign gold bonds at Rs 2,684 per gram. The applications for the same will be accepted from 5th November to 20th November 2015.

The scheme is aimed at providing an alternative to buying physical gold. It will offer investors an interest rate of 2.75% and a choice to by bonds worth 2 grams of gold. Investors can invest up to a maximum of 500 grams.

The bonds will be sold through banks and designated post offices and would be issued on 26th November 2015. The tenure of the bond will be for a period of eight years with an exit option from fifth year to be exercised on the interest payment dates.

Interest earned on gold bonds will be taxable and capital gains tax will be levied as in case of physical gold. The bonds can be bought by resident Indian entities including individuals, HUF's, trusts, universities and charitable institutions.

The government has come up with two new gold related schemes: the gold bond scheme and the gold monetization scheme. Both, without doubt, will help to funnel idle assets into more productive sectors of the economy. However, the success of both is dependent on many factors. To know more about the relative attractiveness of these schemes please click here.