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Tuesday April 19, 2:30 PM
Paring gains...
By Equitymaster.com
After the rally witnessed in the early trades, sentiment has again turned cautious, as markets have lost a bulk of their gains. While banking, telecom, power and energy sectors continue to hold ground, commodity, auto, pharma and software sectors seem to be out of favour.
The BSE Sensex is trading at 6,183 (up 27 points) and the Nifty is trading at 1,934 (up 6 points). The rupee is trading at Rs 43.76 per US Dollar
RBI has allowed IDBI (IDBI.BO, news) a five year window within which it will have to meet the priority sector lending norms. IDBI, which had total advances to the tune of Rs 400 bn will now have to scale up its lending to the priority sectors to 50% to be able to ensure that its priority sector portfolio is 40% of its total outstanding loans at the end of five years. IDBI also has to maintain a cash reserve ratio (CRR) of 5% of net demand and time liabilities and also invest 25% in government securities to meet statutory liquidity ratio (SLR) norms. This indicates that the bank will face a liquidity crunch for its non-food credit offtake and might witness a lower topline growth in the coming quarters. IDBI is marginally in the positive while the other heavyweights in the sector such as ICICI Bank (ICBK.BO, news) (up 1%), HDFC Bank (HDBK.BO, news) (2%) and UTI Bank (UTBK.BO, news) (3%) seem to have regained investor confidence.
Lubricant major, Castrol India has posted a 19% YoY growth in its 4QFY05 bottomline. The company's topline also grew by 9.6% YoY during the same period. Castrol has a market share of nearly 20% with a strong marketing network in the bazaar segment and has a stronghold in the OEM (original equipment manufacturing) and tractors segment. The company has witnessed a spurt in its raw material costs due to the rise in the prices of crude oil and other petroleum products including base oil. The increased cost has been partially recovered through price increases and efficiency initiatives. The stock is up 4%, while others in the sector such as ONGC (2%), Gujarat Gas (3%) and Indraprastha Gas (3%) are also in the positive.
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