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Sensex sheds 45 points on selling in heavyweights

The Bombay Stock Exchange (BSE) 30-share Sensitive Index (Sensex) shed all of its Tuesday's gains on selling pressure in select Old as well as New Economy stocks on Wednesday.

After moving in an intra-day range of 69.49 points, the Sensex closed with a loss of 45.11 points at 3,284.17.

The National Stock Exchange's S&P CNX Nifty Index shed 8.95 points to settle at 1,063.90.

The undertone remained cautious even after constituents of the ruling National Democratic Alliance (NDA) assured their support to Prime Minister Atal Bihari Vajpayee, clearing doubts about his long-term future after he offered to resign from his post. Vajpayee offered to quit on Tuesday due to indiscipline among NDA constituents. The ruling party's allies have been critical about the government, especially over the Unit Trust of India (UTI) muddle.

Selling pressure was witnessed from local as well as foreign institutional investors in Old and New Economy stocks. Buying was seen in select stocks that had posted impressive quarterly results on Tuesday.

The Sensex opened in the positive zone with a gap of 6 points at 3,335. After touching the day's high of 3,346.21 in early trades, it declined. It sank into the red in afternoon trades and slipped further. Towards the close, the Sensex touched an intra-day low of 3,276.72 before settling at 3,284.17, losing 45.11 points or 1.35% from its previous close.

The Sensex had gained 43.39 points or 1.32% on Tuesday to close at 3,329.28.

Turnover on BSE rose to Rs 1,138.48 crore (Rs 808.34 crore on 31 July 2001) from 5.96 crore shares traded. Of the 1,286 issues traded, declines outnumbered advances with 638 losers and 528 gainers. 120 issues remained unchanged.

Pivotal stocks

Satyam Computer (down 6.87% to Rs 136.90) touched a two-year low of Rs 130.60 in intra-day trades before recovering slightly towards the close. There have been reports that Satyam Infoway, or Sify, in which Satyam Computer has substantial (over 50%) stake, may be delisted from Nasdaq if its price falls below $1.

According to Nasdaq norms, a security that trades below a minimum bid level of $1 for 30 consecutive trading sessions will be de-listed. After 30 days of consecutive trading below the $1-level, Nasdaq sends a letter to the company giving it 90 calendar days to fulfil the minimum bid requirement and if the company fails to do so, the scrip faces de-listing. Satyam topped volumes on BSE with over 1.05 crore shares being traded.

NIIT came off from an intra-day high of Rs 181 to a new 65-month low of Rs 155 on massive selling pressure before settling at Rs 157.35, down 5.69% from its previous close. 13.62 lakh NIIT shares were traded on BSE.

Infosys Technologies (down 3.82% to Rs 3,617.65) ended in the red after remaining in the positive zone for the better part of the session. The stock declined sharply from its intra-day high of Rs 3,849. Over 4.34 lakh Infosys shares were traded on BSE. LIC was said to have turned a seller on the Infosys counter.

Fast moving consumer goods (FMCG) heavyweight Hindustan Lever (HLL) (down 4.52% to Rs 211.20) contributed to the fall in the Sensex, coming off sharply from an intra-day high of Rs 221.90. The HLL scrip had risen 2.78% to Rs 223.40 on 25 July 2001, a day after the company announced its JQ 2001 results. However, the scrip slipped to Rs 218.20 on Monday, recovering again on Tuesday to Rs 221.20.

For Q2 June 2001, the company had recorded a 21% rise in net profit to Rs 346.73 crore on a 2% rise in turnover (net of excise) to Rs 2,931.25 crore. The company's operating profit margin improved to 13.4% against 12% in the corresponding quarter of the previous year.

Gujarat Ambuja Cements (down 3.87% to Rs 173.90) slipped despite impressive results. For the year ended 30 June 2001, the company had posted a net profit of Rs 185.14 crore (Rs 174.57 crore) on sales of Rs 1,268.57 crore (Rs 1,117.08 crore).

Grasim (down 2.73% to Rs 305.85) declined from an intra-day high of Rs 326.50. The company had declared its results on Tuesday. For the quarter ended 30 June 2001, it had posted a 72.03% rise in net profit to Rs 102.24 crore (Rs 59.43 crore) on sales of Rs 1,198.71 crore (Rs 1,208.12 crore).

L & T (down 2.77% to Rs 207.25) also came off from an intra-day high of Rs 217 on selling pressure at higher levels.

Hindalco (down 1.98% to Rs 741.05) lost ground after the company announced lower-than-expected results. For the quarter ended 30 June 2001, the aluminium major posted a 8.36% drop in net profit to Rs 161.11 crore (Rs 175.80 crore) on sales of Rs 549 crore (Rs 565.20 crore).

Reliance Industries (down 1.58% to Rs 314.70) also ended in the red on selling pressure, after Tuesday's spurt. The company had declared its results on Tuesday. For the quarter ended 30 June 2001, it registered a 13.81% rise in net profit to Rs 618 crore (Rs 543 crore) on sales of Rs 5,756 crore (Rs 6,013 crore).

Selling was seen in Old Economy pivotals like Telco (down 3.59% to Rs 68.50), Tata Steel (down 2.39% to Rs 91.80), HPCL (down 2.24% to Rs 139.60), Castrol (down 1.96% to Rs 208) and Bhel (down 0.29% to Rs 153.50).

Meanwhile, Zee Telefilms (up 14.47% to Rs 99.30) bounced back into the positive zone, recovering from an intra-day low of Rs 80.10 on renewed buying at lower levels. For the quarter ended 30 June 2001, the company had posted a 11.91% rise in net profit to Rs 29.88 crore (Rs 26.70 crore) on sales of Rs 98.86 crore (Rs 70.67 crore). For the quarter ended 30 June 2001, the company had recorded a consolidated net profit of Rs 36.37 crore on an income of Rs 254 crore (Rs 224 crore).

The rise in Zee followed a huge 22% surge on the counter on Tuesday to Rs 86.75. The market buzz is that a huge deal took place between Mumbai-based brokerage Kotak Securities and a Hong Kong-based firm on Tuesday.

In four trading sessions, the Zee stock had lost 22.82% to close at Rs 71 on 30 July 2001 from Rs 92 on 24 July 2001. The scrip declined on reports that the Securities and Exchange Board of India (Sebi) was probing some of Zee's past equity placement deals. Dealers said there have been rumours about a foreign media company taking up a strategic equity stake in the company. Zee had earlier said that it was on the lookout for a strategic business partner who would also pick up equity stake.

There were also reports that Zee's promoter Subhash Chandra, who currently holds 59% stake, may bring down his stake to below 50% to make way for a strategic partner.

Dr Reddy's Laboratories (up 8.97% to Rs 1,839.80) posted gains after the company announced impressive results on Tuesday, after market hours. For the quarter ended 30 June 2001, the company had posted a 173% rise in net profit to Rs 53.50 crore (Rs 19.59 crore) on sales of Rs 263.59 crore (Rs 124.90 crore). The company's board had also approved an increase in investment limit to foreign institutional investors (FIIs) to 49% and the sub-division of shares of Rs 10 each into two equity shares of Rs 5 each. The stock touched its all-time high of Rs 1,849 in intra-day trades.

Reliance Petroleum (up 1.12% to Rs 45.15) ended in the positive zone on selective buying support. The company had declared impressive results on Monday. For the quarter ended 30 June 2001, the private sector refining giant had posted a 52% rise in net profit to Rs 456 crore (Rs 300 crore) on sales of Rs 8,865 crore (Rs 5,983 crore).

MTNL (up 0.80% to Rs 120.35) ended flat after the company announced flat results on Tuesday. For the quarter ended 30 June 2001, the company posted a 2.33% rise in net profit to Rs 377.30 crore (Rs 369.05 crore) on an income of Rs 1,547.42 crore (Rs 1,446.86 crore).

Others like BSES (up 2.10% to Rs 204.60), ACC (up 1.80% to Rs 141.50), State Bank of India (up 1.36% to Rs 205.30), M&M (up 1.02% to Rs 69.10) and Bajaj Auto (up 0.59% to Rs 254.95) ended in the positive zone.

Tech stocks

Among non-Sensex tech stocks, DSQ Software (down 15.99% to Rs 34.15) declined after BSE informed its members that the ad-interim injunction dated 26 July 2001 granted by the Chennai City Civil Court against suspension of trading in the company, was vacated on 31 July 2001. The stock, however, recovered from its 20% lower limit of Rs 32.55.

SSI (down 16.31% to Rs 138) slipped once again on selling pressure. The stock touched a new three-year low of Rs 133.10 in intra-day trades. Over 22 lakh SSI shares were traded on BSE.

The higher-end software training major has been under pressure following a slowdown in the US economy, which has affected the demand for software professionals. The stock has shed over 83% from its recent high of Rs 827.90 on 23 April 2001.

Silverline Technologies (down 6.34% to Rs 40.65) was subdued on selling pressure after its poor results. For the quarter ended 30 June 2001, the company posted a 30.37% drop in net profit to Rs 17.54 crore (Rs 25.19 crore) on an income of Rs 58.18 crore (Rs 66.30 crore).

The company attributed the poor performance to the US slowdown as well as delays in orders from clients. It is now focusing on business integration and building on core strengths to achieve growth.

Ramco Systems (down 7.94% to Rs 248.55) lost ground after it declared its results. For the quarter ended 30 June 2001, the software products major posted a loss of Rs 4 crore (Rs 1.7 crore) on sales of Rs 26.60 crore (Rs 25 crore).

Selling was seen in other tech stocks like Blue Star Infotech, R. S. Software, Aftek Infosys, Subex Systems, Geometric Software, VisualSoft, CMC, Mphasis BFL, Mascot Systems, Sonata Software, Pentasoft Technologies, Mastek, PSI Data Systems and Polaris Software.

On the other hand, frontline software stocks like Digital Equipment (up 4.33% to Rs 455.20), HCL Technologies (up 6.35% to Rs 262.75), Hughes Software (up 1.67% to Rs 605.15) and Wipro (up 3.42% to Rs 1,494.25) posted gains on selective buying support.

Buying was seen in other tech stocks like e-Serve International, Aptech, Kale Consultants, Rolta India and Tata Infotech.

Telecom stocks

Sterlite Optical (up 8.29% to Rs 182.85) ruled firm following a surge in its Q1 net profit and buy-back plans. After trading hours on Tuesday, the company had posted a 205.13% rise in Q1 net profit to Rs 67.68 crore (Rs 22.18 crore). Total income rose by 249.5% to Rs 173.90 crore as compared to Rs 49.75 crore. The company had also said that its board would meet on 3 August 2001 to consider a proposal to buy back its shares.

Aksh Optifibre (up 1.98% to Rs 90.05) ended with gains on selective buying support.

VSNL (up 1.57% to Rs 278) rose on fresh buying support at lower levels. The stock had shed 16% last week after a consortium of Bharti Enterprises and Singapore Telecom announced that it had opted out of the race to acquire a strategic stake in the state-run overseas telecom carrier. Videocon group, another contender, has also followed suit.

Buying was seen in Birla Ericsson, Vindhya Telelink, ITI and Punjab Communications.

On the other hand, HFCL (down 3.22% to Rs 54.05) declined on lower-than- expected results. For the quarter ended 30 June 2001, the company posted a 66.75% drop in net profit to Rs 20.51 crore (Rs 61.78 crore) on sales of Rs 160.29 crore (Rs 253.68 crore).

Finolex Cables (down 1.83% to Rs 174.50) slipped after the company announced its results on Tuesday. For the quarter ended 30 June 2001, it posted a 12.20% rise in net profit to Rs 10.42 crore (Rs 9.29 crore) on sales of Rs 125.54 crore (Rs 66.96 crore).

Selling was seen in other telecom-related stocks like Shyam Telecom, Goldstone Technologies, Mobile Telecom, Nelco, Framatome Connectors, Tata Telecom, Krone Communications and Usha Beltron.

Media stocks

Among media stocks, Balaji Telefilms (up 5.53% to Rs 188.90) was firm after it announced impressive results. For the quarter ended 30 June 2001, the media major posted a net profit of Rs 4.94 crore on sales of Rs 23.66 crore.

Tips Industries (up 7.38% to Rs 57.50) gained ground on renewed buying support at lower levels. The stock had slipped earlier this week following its poor results. For the quarter ended 30 June 2001, the company had posted a loss of Rs 10.98 crore (net profit Rs 3.04 crore) on sales of Rs 30.97 crore (Rs 20.90 crore).

Mukta Arts (up 2.42% to Rs 107.95) posted gains on renewed buying at lower levels. The stock had shed nearly 16% in the previous two sessions following a lower-than-expected response to the release of the company's latest film, 'Yaadein'.

On the other hand, Sri Adhikari Brothers (down 6.13% to Rs 59) declined after the company announced its results on Tuesday. For the quarter ended 30 June 2001, the media major had posted a 17.60% drop in net profit to Rs 3.79 crore (Rs 4.60 crore) on sales of Rs 21.68 crore (Rs 20.81 crore).

Pharmaceutical stocks

Among non-Sensex pharmaceutical stocks, Aurobindo Pharma (down 6.52% to Rs 172) slipped after the company announced disappointing results. For the quarter ended 30 June 2001, the company posted a 47.05% drop in net profit to Rs 11.27 crore (Rs 21.30 crore) on sales of Rs 189.96 crore (Rs 216.10 crore).

Glenmark Pharma (down 6.32% to Rs 100) declined after its poor results. For the quarter ended 30 June 2001, the company posted a 17% fall in net profit to Rs 2.30 crore (Rs 2.80 crore) on sales of Rs 40.60 crore (Rs 29.20 crore).

Selling was seen in other pharmaceutical stocks like Suven Pharma, Torrent Pharma, Astra-IDL, Panacea Biotech, Sun Pharma, Parke-Davis, Rhone Poulenc, Kopran, Pfizer, SmithKline Beecham Pharma, Burroughs Wellcome, Wockhardt and German Remedies.

On the other hand, Krebs Biochem, Duphar Pharma, Morepen Laboratories, Nicholas Piramal, Aventis Pharma, Knoll Pharma, Ipca Laboratories, J. B. Chemicals and Fulford recorded gains.

FMCG stocks

Among FMCG stocks, Archies Greetings (down 11.36% to Rs 39.80) slipped further on selling pressure. For the quarter ended 30 June 2001, the company had posted a net profit of Rs 1.59 crore (Rs 2.57 crore) on sale of Rs 12.51 crore (Rs 11.45 crore).

Gillette India (down 0.87% to Rs 318.75) declined after the company announced its results on Tuesday. For the quarter ended 30 June 2001, it had posted a loss of Rs 0.97 crore (loss Rs 3.83 crore) on sales of Rs 105.14 crore (Rs 104.29 crore).

Selling was seen in stocks like SmithKline Beecham Consumer Healthcare, Bata India, Procter & Gamble, Tata Tea and Dabur India.

On the other hand, buying was seen in United Breweries, Nirma, Godrej Consumer Healthcare, Rayban Sun Optics, Cadbury India, Britannia Industries, Reckitt Benckiser and Kodak India.

Banking stocks

Among banking stocks, J & K Bank (up 3.34% to Rs 54.10) touched a new high of Rs 54.10 even after BSE imposed a 25% special margin on the stock. The bank had declared impressive results on Saturday. For the quarter ended 30 June 2001, the bank recorded a net profit of Rs 55.61 crore (Rs 37.07 crore) on an income of Rs 375.11 crore (Rs 280.32 crore).

HDFC Bank (up 1.47% to Rs 237.50) gained ground after the company declared its results on Tuesday. For the quarter ended 30 June 2001, the bank had posted a 33.78% rise in net profit to Rs 62.01 crore (Rs 46.35 crore) on an income of Rs 455.47 crore (Rs 322.74 crore).

Buying was seen in other banking and finance stocks like Global Trust Bank, Bank of Punjab, HDFC, Corporation Bank, Bank of Rajasthan and Bank of India.

On the other hand, IndusInd Bank, IDBI Bank, South Indian Bank, ICICI Bank, Federal Bank, IDBI and Oriental Bank of Commerce declined.

Side counters

Among side counters, IndoGulf Corp (up 2.91% to Rs 33.60) rose after the company declared impressive results. For the quarter ended 30 June 2001, it posted a net profit of Rs 50.47 crore (Rs 43.34 crore) on sales of Rs 581.19 crore (Rs 446.69 crore).

Essel Packaging (up 0.86% to Rs 159) ended flat after the company declared its results on Tuesday. For the quarter ended 30 June 2001, it had posted a 8.24% fall in net profit to Rs 8.57 crore (Rs 9.34 crore) on sales of Rs 53.69 crore (Rs 52.09 crore)

Buying was seen on other side counters like Shree Rama Multitech, Bombay Dyeing, Aventis CropScience, Sterlite Industries, Thermax, Cummins India, ICI India, Syngenta India, Adani Exports, Trent, BPL, Tata Power, Escorts, Alfa Laval and Amara Raja Batteries.

On the other hand, BPCL, Hinduja TMT, Saw Pipes, Siemens, MRF, Balrampur Chini, United Phosphorus, Apollo Hospitals, Indian Rayon, Carrier Aircon, Max India, ONGC, IBP, Bharat Forge, Voltas, Esab India, Tata Chemicals, TVS Suzuki and Atlas Copco ended in the red.

Source: www.capitalmarket.com

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