Samvat 2067 nudges mkts past 21,000!

Fri, 5 Nov Closing

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The start of Samvat 2067 managed to give that final nudge that the BSE Sensex needed to get past the intimidating 21,000 mark. The trading was also marked by a lot of stability as no major volatility was seen throughout the trading session. All sectoral indices across the board witnessed gains today. The highest gains were seen in stocks from the pharma and auto spaces.

While the BSE-Sensex closed with gains of 111 points, the NSE-Nifty higher by 26 points. Stocks from the mid and small-cap spaces also saw gains with the BSE-Midcap and BSE-Smallcap indices closing higher by 0.9% and 1.5% respectively.

As per reports, engineering major L&T is planning to launch a Rs 5 bn to Rs 20 bn private equity (PE) fund. This is reportedly part of the company's strategy to become a financial super house by synergizing on the skills that the company already possesses. The funds will be domestically raised. The company will be able to provide expertise in evaluation of opportunities in its principal business of engineering and construction. The financial evaluation on the other hand will be done by an independent professional team. The stock of L&T closed on a negative note. However, its peers from the capital goods space like KSB Pumps and Emco did well on the bourses today.

Jagran Prakashan announced its 2QFY11 results recently. Its topline increased by 12.2% YoY during 2QFY11 led by a 12.7% YoY growth in advertising revenues. EBITDA margins fell from 33.7% in 2QFY10 to 32.8% during the quarter. Other income, which includes revenues from outdoor advertising, event management activity and short code services grew by 27.3% YoY during 2QFY11. The company's bottom line grew by 10.4% YoY during the period on account of the topline growth, increase in other income and fall in interest costs, despite lower operating income. For 1HFY11, net profit grew by 11.3% YoY while net profit margin fell by 0.5% to stand at 20.3%. This performance comes on the back of a fall in other income and higher effective tax rate. Media stocks saw a mixed performance today with the stock of Jagran Prakashan closing on a negative note.

Corporate India seems to be an optimistic lot right now. At least if a survey conducted by the National Council for Applied Economic Research (NCAER) and MasterCard Worldwide is to be believed. As per its findings the business confidence level in India Inc in the April-August 2010 period has increased 4% over the previous quarter. This takes its index up to a total of 162.1, reportedly the highest ever since 1993. The decline from double digit inflation rates, the 28% YoY growth in exports during this period and brisk business in many sectors of the economy are some of the factors that seem to be the cause of the optimism. Especially consumption driven sectors seem to be doing very well. Consumer goods, both durable and non-durable are reporting full capacity utilisation. A reflection of the optimism comes from the fact that a whopping 83.4% of the respondents in the survey expected an increase in sales over the next six months. This is great news for both business and investors. Confidence is the lifeblood of a healthy economy. It is the most important factor that leads to higher levels of both demand and supply in the economy. These are, after all, the two sides of the coin when it comes to GDP growth. An auspicious start to Samvat 2067, we must say.