Wednesday March 21, 03:30 PM
From strength to strength... |
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By Equitymaster.com
Markets made further inroads into the positive territory during the last hour of trade. Buying interest sustained across the board. However, select cement, energy and pharma stocks continued to witness selling pressure. Advances outnumbered declines on the Nifty with only 14 stocks ending in the red.
The BSE Sensex closed at 12,946 (up 240 points) while the NSE Nifty closed at 3,765 (up 67 points). The rupee was trading at 43.55 to the dollar.
Proceedings for the day started on a cautious note with markets opening marginally above the break-even. They continued to remain range-bound during the morning session. However, gains registered in the afternoon session, particularly in the final two hours of trade ensured a firm close for the benchmark indices. Volatility in the markets was noticeably lower today. Amongst global markets, while the Asian indices have closed in the positive, the European indices are trading lower currently.
Nestle announced its results for the December quarter yesterday registering a growth of 18% YoY in its topline as compared to the same period last year. The company's bottomline, however, declined by 2.8% YoY excluding the extraordinary items. The fall in bottomline is a result of increased provisioning for contingencies that has been made for two years during the December quarter. For CY06, the company reported a growth in its topline of 24% YoY and a bottomline growth of 2% YoY. The topline has grown mainly on the back of increased volumes and price hikes during the year. The stock ended flat in today's trading session, while its peers Britannia (down 2%) and Tata Tea (TTTE.BO, news) (down 1%) ended in the negative territory.
As it aggressively plans to ramp up its list of subscribers, Dish TV India Ltd, the demerged entity of Zee Telefilms Ltd, is planning to pump in Rs 10 bn over the next two and a half years through a mix of debt and equity. Dish TV has already invested Rs 7 bn in the DTH business. The company expects cash break-even by FY09 while operating margins, currently negative, are expected to be 26%. The company has already reached 1.9 m subscribers and further expects to add 1.1 m subscribers in FY08. Dish TV's Average Revenue Per Unit (ARPU) has increased from Rs 190 to Rs 230 in FY07. The cost of content, currently at 65% of the ARPU, is expected to fall down to 45% over the next two years. Dish TV plans to get listed either on Monday or Wednesday next week. It will be the first DTH company in India to be traded on the stock exchange. The stock of Zee group were mixed during the today's trade with Zee Entertainment (up 2%) closed on the positive note, while Wire and Wireless (down 3%)was out of favor.
As per a leading business daily, Idea Cellular and IBM India Pvt Ltd have inked a 10-year business transformation pact to integrate, innovate and transform Idea's business processes and IT infrastructure. The agreement is designed on an innovative risk - reward revenue sharing model. It covers all of the company's existing operations and potential new additions. The 10 year pact, depending upon Idea's business revenues and circle expansion, is pegged at around US$ 600 m to US$ 800 m. The partnership between Idea and IBM will enable Idea to leverage opportunities from the convergence of voice, data, video and wireless technologies, improve end-to-end customer management to drive efficiency and provide advanced revenue assurance capabilities for top and bottom line growth. Apart from this, it will also help accelerate time-to-market of new services customers, enhance loyalty and add new revenue streams to provide a competitive edge. The stock closed weak (down 1%), while its peers Bharti Airtel (up 3%) and Reliance (RELI.BO, news) Communication (up 2%) closed in the positive territory.
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