Monday April 9, 12:30 PM
Climbing higher... |
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By Equitymaster.com
The indices continued with their ascent as buying interest in index heavyweights failed to diminish. All the stocks except a couple are currently trading higher on the Nifty reflecting the positive sentiment that currently underlies the index. The market breadth is positive in the broader market also with the advance to decline ratio poised at 5.4 to 1 on the NSE.
The BSE Sensex is trading at 13,139 (up 282 points) while the NSE Nifty is trading at 3,835 (up 83 points). The rupee is trading at 42.88 to the dollar.
Energy sector stocks are currently trading firm with Petronet LNG (up 7%), ONGC, BPCL and HPCL (up 2% each) being the major gainers. According to a leading business daily, ONGC has entered into service contracts for development of 14 onshore marginal fields. The contracts have been signed with Hydrocarbon Resources Development, Deep Industries Ltd, BG Shirke Construction Technology, KEI-RSOS Maritime Ltd and Shiv Vani Oil and Gas Exploration. The commercial feasibility of the production from the marginal fields has increased over the past few years with the surge in crude oil prices. Thus, in order to augment the stagnant production levels, the development of marginal fields is one of the focus areas for the company. To accelerate faster development of these fields and optimally utlise its manpower, ONGC has entered into service contracts with various players specializing in this field. ONGC expects to increase its production by 4 to 5 MMTPA (million tonnes per annum) from these fields over the medium term.
The stocks of Bharti Airtel (up 2%) and Reliance (RELI.BO, news) Communications (up 4%) are witnessing buying strong buying interest. If one goes back a year, while the Nifty is up 10% YoY, these companies have been up 82% and 31% respectively. This splendid run up is mainly on account of the strong growth being witnessed in the telecommunication sector. While subscriber acquisition has been the key driver of the current growth, both companies are integrated telecom players and have the ability to offer triple play (voice video and data services) on their networks. Given the positive outlook of the telecom sector and their numero uno positioning in the GSM and CDMA technology respectively, we believe these companies are well poised to realize maximum gains from India's telecommunication revolution.
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