Indian mkts surge in last half hour

Thu, 27 Nov Closing

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After trading below the dotted line for most part of the day, the Indian markets surged above the dotted line towards the end as buying activity picked up in the final half hour of trade. The BSE-Sensex closed the day higher by about 53 points or 0.2%, while the NSE-Nifty ended with gains of about 18 points or 0.2%. While weakness was seen in certain sectors such as consumer durables and realty, those from the information technology and power space led the pack of gainers. Midcaps and smallcaps ended the day on a firm note as well with the BSE Mid Cap and BSE Small Cap indices closing higher by about 0.5% and 0.6% respectively.

Stock markets in other parts of Asia ended the day on a mixed note while European markets were trading firm at the time of writing. The rupee was trading at Rs 61.87 to the dollar at the time of writing.

Stocks of consumer durables companies ended the day on a weak note with Bajaj Electricals, Symphony and Videocon Industries leading the pack of losers. As reported by the Hindu Business Line, the home appliances sector is expected to go through a phase of consolidation with market leaders looking to buy out smaller firms. For instance, the largest seller of mixer grinders and irons in the country, Bajaj Electricals is believed to be on the lookout for smaller companies in the non-electrical kitchen appliances segment. As per the company, it is looking to strengthen its position in product categories such as pressure cookers, gas stoves, and non-stick cookware. However, one thing that investors should consider here is the company's struggling E&P business. While the management had indicated that legacy orders are about to come to a closure, going by the stock performance off late, it seems the improvement is yet to be seen.

Fertilizer stocks ended the day on a firm note led by Chambal Fertilizers, Tata Chemicals and Godavari Fertilizers. The stock of Tata Chemicals touched its all time high figure today. The stock has gained by 59% over the last year. The improvement in the company's financial performance seems to be a key reason behind the stock rise over the past year. The company's profit after tax during the latest quarter stood at Rs 2.6 bn as compared to Rs 1.98 bn in the same quarter last year. Apart from the strong improvement in operating performance, lower interest costs have helped the company improve its bottomline as well. As reported by the business daily Mint, the company has been working towards improving its balance sheet and also has been restructuring its operations. For instance, the performance of its European and African businesses improved substantially in the quarter gone by, from a year ago. A key change made by the business was that of shutting down its premium ash plant in Africa after which the operations have stabilized. On an overall basis, the company has been working on improving its balance sheet as well, which is the area of focus for the business at the moment. This also includes sale of non-core businesses. As reported, the aim is to halve its stand-alone debt in five years.