THE END SESSION ( 30 / 05 / 2016 )

Sensex, Nifty attain highest closing level in more than 7 months

Amid a divergent trend among various index constituents, the two key benchmark indices registered small gains. The barometer index, the S&P BSE Sensex, rose 72 points or 0.27% to settle at 26,725.60. The Nifty 50 index rose 21.85 points or 0.27% to settle at 8,178.50. With fifth straight trading session of gains, the Sensex and the Nifty, both, attained their highest closing levels in more than 7 months.

Hindalco Industries surged 12.03% after the company announced strong Q4 March 2016 results. Shares of state-run coal mining giant Coal India moved higher after announcing increase in coal prices. Tata Motors edged higher ahead of the announcement of its Q4 March 2016 results. Maruti Suzuki India (MSIL) edged lower after the company announced temporary suspension of manufacturing of cars from its Manesar and Gurgaon facilities due to fire accident at the Manesar facilities of its supplier Subros.

Bharat Heavy Electricals dropped after reporting dismal Q4 March 2016 results. But, the NTPC stock shrugged off weak financial performance for Q4 March 2016. Tech Mahindra edged higher after the company's announcement that it has entered into an agreement to acquire UK based Target Group for an enterprise value of GBP 112 million.

State Bank of India (SBI) extended gains registered during the previous trading session after the bank's Chairman Arundhati Bhattacharya said in a post-result conference call held on Friday, 27 May 2016, that bank proposes to contain fresh slippages ratio within 2.7% of advances in the year ending 31 March 2017 (FY 2017).

The Sensex rose 72 points or 0.27% to settle at 26,725.60, its highest closing level since 29 October 2015. The index rose 141.36 points or 0.53% at the day's high of 26,794.96. The barometer index fell 30.27 points or 0.11% at the day's low of 26,623.33.

The Nifty 50 index rose 21.85 points or 0.27% to settle at 8,178.50, its highest closing level since 27 October 2015. The index rose 43.35 points or 0.53% at the day's high of 8,200. The index fell 5.85 points or 0.07% at the day's low of 8,150.80.

The BSE Mid-Cap index rose 0.35%. The BSE Small-Cap index rose 0.42%. Both these indices outperformed the Sensex.

The market breadth indicating the overall health of the market was negative. On BSE, 1,239 shares rose and 1,372 shares fell. A total of 190 shares were unchanged.
The total turnover on BSE amounted to Rs 2563 crore, lower than turnover of Rs 3371.35 crore registered during the previous trading session.

Among the sectoral indices on BSE, the S&P BSE Metal index (up 2.28%), the S&P BSE IT index (up 1.33%), the S&P BSE Teck index (up 1.17%), the S&P BSE Auto index (up 1.11%), the S&P BSE Industrials index (up 1.07%), the S&P BSE Utilities index (up 0.94%), the S&P BSE Telecom index (up 0.59%), the S&P BSE Basic Materials index (up 0.46%), the S&P BSE Power index (up 0.38%), the S&P BSE Consumer Durables index (up 0.31%) and the S&P BSE Capital Goods index (up 0.29%), outperformed the Sensex. The S&P BSE Bankex (up 0.13%), the S&P BSE Consumer Discretionary Goods & Services index (up 0.12%), the S&P BSE Energy index (up 0.08%), the S&P BSE Healthcare index (down 0.02%), the S&P BSE FMCG index (down 0.05%), the S&P BSE Finance index (down 0.16%), the S&P BSE Oil & Gas index (down 0.4%) and the S&P BSE Realty index (down 1.02%) underperformed the Sensex.

Tata Steel declined 1.79% at Rs 323.10. Global credit rating agency Moody's Investors Service on Friday, 27 May 2016, said that the proposed sale of Tata Steel UK's long products Europe business to Greybull Capital and Tata Steel Europe's decision to sell its UK business are credit positive on its ratings on Tata Steel and Tata Steel UK. 

Moody's said that the divestment of the loss-making operations will reduce the drag on the European business' profitability, which has been under strain for a while. Tata Steel Europe has initiated the process of selling its entire holding in Tata Steel UK due to the deteriorating financial performance of the UK subsidiary. Moody's said that it will watch out for clarity on divestment of liabilities including pensions and erasing the negative EBITDA impact of the UK facilities on Tata Steel UK's credit metrics would be critical for any change in outlook to its rating on Tata Steel UK.

Hindalco Industries surged 12.03% at Rs 102.90 after net profit jumped 123.36% to Rs 356.33 crore on 7.6% fall in total income to Rs 8871.66 crore in Q4 March 2016 over Q4 March 2015. The result was announced on Saturday, 28 May 2016. The company's revenue from operations dropped 7.51% to Rs 8667.52 crore in Q4 March 2016 over Q4 March 2015. The company attributed the decline in revenue to a sharp decline in both aluminium and copper realizations. In aluminium, the impact was much severe due to a sharp fall in local market premium and a sharp surge in imports of aluminium in the country. The company said its operational performance was strong. A strong increase in aluminium volumes, a thrust on value addition across businesses, lower cost of raw materials and a weaker rupee helped the company partially offset the impact of a sharp fall in realizations. The bottom line was boosted by base effect. The company's bottom line in Q4 March 2015 was adversely impacted by a non-recurring expenditure of Rs 146.48 crore.

With regard to the future business outlook, Hindalco said that the uncertain global macros pose several challenges for the company. The management will continue its un-relented focus on operational excellence, enhanced value addition and cash conservation to tide over these circumstances.

Shares of state-run coal mining giant Coal India rose 3.8% at Rs 292.05 after the company's board of directors at its meeting held on Saturday, 28 May 2016, approved about 6.29% increase in coal prices with effect from 30 May 2016. This will be applicable to all subsidiaries of Coal India and NEC for regulated and non-regulated sectors. Due to this revision, Coal India will earn additional revenue of about Rs 3234 crore for the balance period of current financial year i.e. from 30 May 2016 to 31 March 2017. The board has also approved the differential price for non-regulated sector at a reduced rate of 20% over the price of regulated sector for G6 to G17 grades of coal for all subsidiaries of Coal India.

Coal India's consolidated net profit rose 0.22% to Rs 4247.93 crore on 0.72% decline in total income to Rs 22898.79 crore in Q4 March 2016 over Q4 March 2015. The result was announced on Saturday, 28 May 2016.

Tata Motors rose 4.23% at Rs 420.55 ahead of its Q4 March 2016 results today, 30 May 2016.

Maruti Suzuki India (MSIL) edged lower after the company announced temporary suspension of manufacturing of cars from its Manesar and Gurgaon facilities due to fire accident at the Manesar facilities of its supplier Subros. The stock shed 1.65% at Rs 4,073.15. Maruti will temporarily suspend car production at its Manesar and Gurgaon facilities starting second half of 30 May 2016. Subros and MSIL are jointly assessing the extent of damage to essential equipment, MSIL said. MSIL said that it is examining the options available for the procurement of components from other facilities. Production will resume as soon as components become available, MSIL said. The announcement was made during market hours today, 30 May 2016.

Separately, MSIL after market hours on Friday, 27 May 2016, announced that the car maker is all set to start exports of its much awaited light commercial vehicle (LCV) Super Carry to South Africa and Tanzania. The first lot of nearly 100 Super Carry LCVs has been dispatched for shipment, MSIL said. The shipment to South Africa and Tanzania is of the petrol variant of Super Carry, the company said. The petrol variant for export market is powered by G12B engine. Besides African markets, the company also plans to export the Super Carry to South Asian Association for Regional Cooperation (SAARC) nations, it added. Based on the feedback, the company will explore export opportunities for Super Carry in other international markets, MSIL said. The India launch for Super Carry is planned in Q2 September 2016. To begin with, it will be launched in select parts of the country. For the domestic market, Super Carry will be powered by the E08 diesel engine. The company is setting up a separate retail channel in the Indian market exclusively for the Super Carry, MSIL said.

Mahindra & Mahindra (M&M) declined in volatile trade after announcing Q4 March 2016 results. The stock fell 0.57% to Rs 1,327.50. The stock hit a high of Rs 1,351.20 and a low of Rs 1,314.10 in intraday trade. The company's net profit rose 6.02% to Rs 583.73 crore on 14.57% growth in total income to Rs 10912.45 crore in Q4 March 2016 over Q4 March 2015. The result was announced during market hours today, 30 May 2016.

The combined net profit of M&M and Mahindra Vehicle Manufacturers (MVML) before exceptional items rose 20.5% to Rs 662 crore on 16% growth in gross revenue plus other income to Rs 11669 crore in Q4 March 2016 over Q4 March 2015. MVML was set up as a 100% subsidiary of M&M with a view to sourcing contemporary products for expanding the market offerings of the company.

The NTPC stock shrugged off weak financial performance for Q4 March 2016. The stock rose 2.29% at Rs 143.10. The company's net profit fell 7.73% to Rs 2716.41 crore on 6.19% decline in net total income from operations to Rs 18112.62 crore in Q4 March 2016 over Q4 March 2015. The result hit the market at the fag end of the trading session.

NTPC said that the group's installed capacity increased to 46,653 megawatts (MW) as on 31 March 2016 from 44,398 MW as on 31 March 2015. Its consolidated commercial capacity increased to 45,103 MW as on 31 March 2016 from 43,143 MW as on 31 March 2015. The plant load factor (PLF) of coal-based generation units was reported at 81.30% in Q4 March 2016, lower than 82.68% in Q4 March 2015. The PLF of gas based generation units was reported at 17.83% in the quarter ended 31 March 2016, which was lower than 26.68% in the quarter ended 31 March 2015.

The company's plant availability factor (PAF) for coal-based units was reported at 95.24% in the quarter ended 31 March 2016, lower than 97.18% in the quarter ended 31 March 2015. PAF for gas-based units was reported at 98.20% in the quarter ended 31 March 2016, higher than 96.46% in the quarter ended 31 March 2015.

Bharat Heavy Electricals (Bhel) lost 5.81% at Rs 120.75 after net profit fell 59.52% to Rs 359.58 crore on 18.36% decline in total income to Rs 10418.64 crore in Q4 March 2016 over Q4 March 2015. The result was announced after trading hours on Friday, 27 May 2016. Bhel's order backlog stood at about Rs 1.10 lakh crore as on 31 March 2016. The company removed orders amounting Rs 3783 crore from the order book in Q4 March 2016. It removed orders amounting Rs 7429 crore from the order book in the year ended 31 March 2016, which are not likely to commence.

Bhel is set to move out as a constituent of the Sensex with effect from 20 June 2016. Power Grid Corporation of India (PGCIL) will replace Bhel as a constituent of the Sensex from that date.

Realty major DLF fell 2.05% at Rs 126.35 after consolidated net profit declined 22.86% to Rs 132.39 crore on 19.55% rise in net sales to Rs 2335.56 crore in Q4 March 2016 over Q4 March 2015. The result was announced after market hours on Friday, 27 May 2016. In a post result statement, DLF said that the company believes that the residential real estate sector in India can see a turnaround in the near future. During the last few quarters, DLF has witnessed large number of inquiries signalling early green shoots of recovery for the sector.

With regard to the commercial real estate development business, DLF has started construction of a new office project called Cyber Park at a prime location just opposite Oberoi and Trident Hotels in Gurgaon, with an approximate size of 2.2 msf (including TOD). With regard to the retail mall development business, DLF officially opened its mall Mall of India in Noida with around 90% pre-leasing.

Tech Mahindra rose 1.54% at Rs 543.95 after the company said it has entered into an agreement to acquire UK based Target Group for an enterprise value of GBP 112 million. The transaction is expected to close by 31 October 2016, subject to the receipt of regulatory approvals. Target Group is a financial technology (Fintech) and BPaaS (Business Process as a Service) provider in the banking, asset management, government and insurance sectors. Tech Mahindra said that the acquisition will broaden its service offerings in the banking, financial services and insurance (BFSI) domain and strengthen its presence in Europe. The acquisition will enhance Tech Mahindra's capabilities and allow Tech Mahindra to capture a larger share of the GBP 45-60 billion annual spend by UK BFSI companies on software and services.

Target Group had revenue of GBP 51 million in the year ended 31 December 2015 (FY 2015). After the completion of the acquisition by Tech Mahindra, Target Group will remain a standalone entity retaining its existing brand, which has a strong reputation in the marketplace. The entire management team at Target will stay with the business and continue to have full operational responsibility. Tech Mahindra made the announcement of the acquisition after trading hours on Friday, 27 May 2016.

Index heavyweight and software major Infosys rose 1.37% at Rs 1,263.45. The stock hit a record high of Rs 1,270 in intraday day. The stock hit a low of Rs 1,244.10 in intraday trade.

Sun Pharmaceutical Industries (Sun Pharma) fell 1.57% at Rs 812.50 after the company announced that one of the company's US subsidiaries Sun Pharmaceutical Industries, Inc (SPII) has received a grand jury subpoena from the United States Department of Justice, Antitrust Division seeking documents from SPII and its affiliates relating to corporate and employee records, generic pharmaceutical products and pricing, communications with competitors and others regarding the sale of generic pharmaceutical products, and certain other related matters. SPII is currently responding to the subpoena, Sun Pharma said. Sun Pharma said it is of the opinion that the outcome of the referred enquiry is unlikely to have any material adverse impact on the consolidated operations or consolidated financial results of the company. The announcement was made after market hours on Friday, 27 May 2016.

Sun Pharma is scheduled to announce its Q4 March 2016 results today, 30 May 2016.
Bank stocks witnessed a mixed trend. Among public sector banks, Indian Bank (up 1.79%), Syndicate Bank (up 1.72%), Bank of Maharashtra (up 1.25%), Punjab National Bank (up 0.72%), Union Bank of India (up 0.7%), Andhra Bank (up 0.62%), Central Bank of India (up 0.43%), Punjab and Sind Bank (up 0.25%) and UCO Bank (up 0.14%), edged higher. Canara Bank (down 0.03%), Bank of Baroda (down 0.18%), Allahabad Bank (down 0.19%), Vijaya Bank (down 0.65%), IDBI Bank (down 0.67%), Bank of India (down 0.98%), Dena Bank (down 1.86%) and United Bank of India (down 1.97%), edged lower.

State Bank of India (SBI) extended gains registered during the previous trading session after the bank's Chairman Arundhati Bhattacharya said in a post-result conference call held on Friday, 27 May 2016, that bank proposes to contain fresh slippages ratio within 2.7% of advances in the year ending 31 March 2017 (FY 2017). The stock rose 1.59% at Rs 198.65. The SBI stock surged 6.42% to settle at Rs 195.55 during the previous trading session on Friday, 27 May 2016, shrugging off weak financial performance for Q4 March 2016. SBI has identified about Rs 31000 crore of loans as under special watchlist for FY 2017, which is just 2.1% of overall loan book. Of these watch list accounts, about 70% of loans have more chances of slipping to NPA category. About Rs 11655 crore of watchlist accounts come from restructured advance book, while the sectors contributing to the watch list accounts are power (Rs 4748 crore), iron & steel (Rs 4299 crore), engineering (Rs 3574 crore), oil & gas (Rs 3396 crore), construction (Rs 2608 crore), chemicals (Rs 2326 crore) etc. SBI aims to achieve credit growth of 12-14% in the current financial year, to be driven by retail credit and good quality corporate book.

SBI's net profit fell 66.23% to Rs 1263.81 crore on 10.10% increase in total income to Rs 53526.97 crore in Q4 March 2016 over Q4 March 2015. The result hit the market during trading hours on 27 May 2016.

Among private sector banks, City Union Bank (down 0.47%), Federal Bank (down 0.47%) and IndusInd Bank (down 0.29%), edged lower. Axis Bank (up 0.04%), Kotak Mahindra Bank (up 0.11%) and ICICI Bank (up 0.70%), edged higher.

Index heavyweight HDFC Bank fell 0.61% at Rs 1,180.05. The stock hit a high of Rs 1,194.80 and a low of Rs 1178.05 in intraday trade.

Yes Bank fell 0.12% at Rs 1,025.50. The stock turned ex-dividend today, 30 May 2016, for final dividend of Rs 10 per share for the year ended 31 March 2016.

Index heavyweight and housing finance major HDFC fell 2.16% at Rs 1230.20. The stock hit a high of Rs 1,258.90 and a low of Rs 1,213.30 in intraday trade.

The Sensex and the Nifty edged higher for the fifth day in a row. The Sensex has gained 1,495.24 points or 5.93% in five trading sessions from its close of 25,230.36 on 23 May 2016. The Sensex has gained 1,122.98 points or 4.39% in this month so far (till 30 May 2016). The Sensex has risen 613.06 points or 2.35% in calendar year 2016 so far (till 30 May 2016). From a 52-week low of 22,494.61 hit on 29 February 2016, the barometer index has risen 4,233.99 points or 18.82%. The Sensex is off 1,850.73 points or 6.48% from a 52-week high of 28,578.33 hit on 23 July 2015. The Sensex is off 3,298.14 points or 10.98% from a record high of 30,024.74 hit on 4 March 2015.
In overseas stock markets, European stocks were mixed, with the prospect of a US interest rate hike coming sooner rather than later prompting investors to avoid aggressive bets. In Asia, Japanese stocks edged higher as the yen weakened against the dollar. The Nikkei 225 Average closed 1.39% higher. A weaker local currency benefits exporters, as they can sell their goods at more competitive prices overseas. Japanese Prime Minister Shinzo Abe said he would delay a sales tax hike scheduled for April next year by 2-1/2 years, Masahiko Komura, vice president of the ruling Liberal Democratic Party, told reporters today, 30 May 2016.

Chinese stocks edged higher in volatile trade after the Shanghai and Shenzhen stock exchanges on Friday, 27 May 2016, announced rules on share trading suspensions, removing one potential roadblock to inclusion Chinese A shares or yuan-denominated shares in MSCI Inc.'s global benchmark indexes, a move which could direct large amount of capital into China's stock markets. In mainland China, the Shanghai Composite ended 0.05% higher. In Hong Kong, the Hang Seng index closed 0.26% higher. MSCI said in March a decision to include 5 percent of yuan-denominated shares in its index will depend on regulators implementing changes so that widespread halts can't happen again.

US stocks edged higher during the previous trading session on Friday, 27 May 2016, after the latest data showed that the economy's slowdown in the first quarter wasn't as bad as initially thought. US GDP expanded at a 0.8% seasonally adjusted annual rate in the first three months of 2016, up from an initial estimate for 0.5% growth, the Commerce Department said on Friday, 27 May 2016. The faster-than-expected pace of growth, however, still represents a deterioration from the fourth quarter's 1.4% growth.

Federal Reserve Chairwoman Janet Yellen said in a speech on 27 May 2016 that a rate increase would be appropriate in coming months if the economy continues to strengthen. The Fed has kept the benchmark fed funds rate unchanged after raising it for the first time in nearly a decade in December 2015. The Federal Open Market Committee next undertakes monetary policy review on 14-15 June 2016.

THE WEEK AHEAD

Monthly manufacturing and services sector data in focus

The final batch of Q4 March 2016 corporate results, the outcome of the monthly surveys on India's manufacturing and services sectors, the onset of the monsoon rains and trend in global financial markets will dictate the near term trend on the domestic bourses. Stocks of auto companies will be in focus as companies start unveiling monthly sales volume data for May 2016 from Wednesday, 1 June 2016.
Stocks of public sector oil marketing companies (PSU OMCs) will be in focus as a fuel price review is due at the end of the month. PSU OMCs undertake fuel price review twice during the month based on the trend in international oil market. The first price review takes place during the middle of the month and the second on the last day of the month. Aviation stocks will be in focus as a monthly review of jet fuel prices is due at the end of the month. PSU OMCs review jet fuel prices on the last day every month based on the average imported crude oil price for the month. Jet fuel prices are directly linked to crude oil price.

Stock prices of Coal India and Hindalco Industries will on Monday, 30 May 2016, react to their Q4 March 2016 results to be announced on Saturday, 28 May 2016. Tata Motors, Mahindra & Mahindra, Sun Pharmaceutical Industries, Aurobindo Pharma and NTPC are scheduled to announce Q4 March 2016 results on Monday, 30 May 2016.

Markit Economics will unveil the outcome of a monthly survey on India's manufacturing sector for May 2016 on Wednesday 1 June 2016. The seasonally adjusted Nikkei India Manufacturing Purchasing Managers' Index (PMI) fell to 50.5 in April 2016 from 52.4 in March 2016. Markit Economics will unveil the outcome of a monthly survey on India's services sector for May 2016 on Friday, 3 June 2016. The Nikkei India Services PMI fell to 53.7 in April 2016 from 54.3 in March 2016.

The movement of global crude oil prices will remain in focus as an official meeting of the Organization of the Petroleum Exporting Countries (OPEC) is scheduled on Thursday, 2 June 2016, in Austria's capital Vienna.

On the global front, Asian markets will on Monday, 30 May 2016, react to comments from US Federal Reserve Chairwoman Janet Yellen at a scheduled speech at Harvard University on Friday, 27 May 2016. Her comments could provide more indications about whether the US central bank would raise rates in near term. The Fed has kept the benchmark fed funds rate unchanged after raising it for the first time in nearly a decade in December 2015. The Federal Open Market Committee next undertakes monetary policy review on 14-15 June 2016. Investors in emerging markets, including India are worried that higher interest rates in the US will drain liquidity from emerging markets and redirect it to developed economies.

The US stock market is closed on Monday, 30 May 2016, for the Memorial Day holiday.

THE WEEK THAT WAS

Benchmark indices regain key psychological levels

Positive global cues, an upward revision in monsoon forecast by Skymet, Prime Minister Narendra Modi's comments indicating that further economic reforms are on the cards triggered a rally on the domestic bourses in the week ended Friday, 27 May 2016. The barometer index, the S&P BSE Sensex, moved above the psychological 26,000 mark and the Nifty regained the psychological 8,000 mark during the week. Key indices edged higher in four out of five trading sessions during the week.

In the week ended Friday, 27 May 2016, the 30-share S&P BSE Sensex gained 1,351.70 points or 5.34% to settle at 26,653.60. The Nifty 50 index gained 406.95 points or 5.25% to settle at 8,156.65.

The BSE Mid-Cap index rose 323.85 points or 2.94% to settle at 11,347.03. The BSE Small-Cap index rose 146.70 points or 1.34% to settle at 11,110.96. Both these indices underperformed the Sensex.

Trading for the week started on a weak note. Stocks of public sector banks and index heavyweights HDFC and Infosys led losses for the two key benchmark indices on Monday, 23 May 2016. The Sensex fell 71.54 points or 0.28% to settle at 25,230.36, its lowest closing level since 6 May 2016.

An upward revision in monsoon forecast for the June-September 2016 south west monsoon season from private weather forecaster Skymet and gains in European stocks aided the upmove on the domestic bourses on Tuesday, 24 May 2016, with the barometer index, the S&P BSE Sensex, and the Nifty 50 index snapping a four-day losing streak. The Sensex gained 75.11 points or 0.3% to settle at 25,305.47, its highest closing level since 19 May 2016.

Banking, auto, IT sector stocks and index heavyweights HDFC and ITC led the rally on the domestic bourses on Wednesday, 25 May 2016 triggered by gains in global stocks. The barometer index, the S&P BSE Sensex, jumped 575.70 points or 2.28% to settle at 25,881.17.

Prime Minister Narendra Modi's comments in an interview to a foreign newspaper indicating that further economic reforms are on the cards triggered rally on the domestic bourses on Thursday, 26 May 2016. The Sensex surged 485.51 points or 1.88% to settle at 26,366.68, its highest closing level since 4 November 2015.

Stocks of public sector banks, pharma companies, crude oil refiners and index heavyweights Infosys and HDFC led the upmove on the bourses on Friday, 27 May 2016. The Sensex rose 286.92 points or 1.09% to settle at 26,653.60, its highest closing level since 30 October 2015.

Among the 30-share Sensex pack, 28 stocks gained and only two of them declined in the week ended Friday, 27 May 2016.

ITC (up 8.94%), Adani Ports and Special Economic Zone (up 7.7%), HDFC (up 6.54%), Hindustan Unilever (up 6.02%) and Tata Mootors (up 4.93%) edged higher from the Sensex pack.

Index heavyweight Reliance Industries (RIL) gained 4.13%. As per reports the company is preparing to restart work in four offshore oil and gas blocks, including one of India's biggest natural gas discoveries, as it seeks to revive development activity stalled for seven years by disputes with the government. The company plans to drill 21 wells in four offshore areas, including the deepwater KG-D6 block in the Bay of Bengal, according to reports. RIL aims to initially focus on parts of the KG-D6 block known as the R-cluster, satellite and MJ discoveries. It plans to finalize the investment and work plan by the end of this year.

L&T spurted 17.25% and was the top weekly gainer among the 30-share Sensex pack. The company's management said in a conference call held after the announcement of the company's Q4 March 2016 results on Wednesday, 25 May 2016, that it expects L&T's order inflow to rise 15% in the year ending 31 March 2017 (FY 2017). L&T expects 12-15% growth in revenue in the year ending 31 March 2017 (FY 2017). L&T reported 18.55% rise in consolidated net profit to Rs 2453.64 crore on 17.88% rise in total income to Rs 33375.26 crore in Q4 March 2016 over Q4 March 2015. The result was announced after market hours on Wednesday, 25 May 2016. L&T's order book stood at Rs 249949 crore as on 31 March 2016, higher by 7% on year-on-year basis. 

International order book constituted 28% of the total order book. L&T said in a statement that the company continues its emphasis on operational efficiencies, faster execution of projects on hand and reduced working capital levels. Given its track record, diversified portfolio and healthy order book, the company is focusing on profitable execution of the existing order book and is confident of its growth in the near to medium term by leveraging its presence in both the domestic and international segments.

Bharat Heavy Electricals (Bhel) rose 7.51%. The company's net profit fell 59.52% to Rs 359.58 crore on 18.36% decline in total income to Rs 10418.64 crore in Q4 March 2016 over Q4 March 2015. The result was announced after trading hours on Friday, 27 May 2016. Bhel's order backlog stood at about Rs 1.10 lakh crore as on 31 March 2016. The company removed orders amounting Rs 3783 crore from the order book in Q4 March 2016. It removed orders amounting Rs 7429 crore from the order book in the year ended 31 March 2016, which are not likely to commence.

Sun Pharmaceutical Industries rose 4.22%. The company's US subsidiary Taro Pharmaceutical Industries posted strong financial performance for the year ended 31 March 2016. Taro Pharmaceutical Industries' consolidated net profit rose 11.69% to $540.9 million on 10.2% growth in net sales to $950.80 million in the year ended 31 March 2016 over the year ended 31 March 2015. The result was announced on Thursday, 26 May 2016. Taro reportedly contributes around 32% of the US turnover of Sun Pharmaceutical Industries.

Lupin fell 1.62%. The company announced during trading hours on Friday, 27 May 2016, that it has received Establishment Inspection Reports (EIR) for its Mandideep and Aurangabad facilities wherein the U S Food and Drug Administration (USFDA) has concluded that the inspections stand closed. The USFDA had conducted audits at Lupin's Mandideep facility from 8 to 19 February 2016 and its Aurangabad facility from 11 to 15 January 2016. Lupin said that the company had taken appropriate steps to address the observations it had received from these audits. Having received the EIRs from the USFDA about the closure of these inspections, all observations stand addressed and both these facilities are cGMP compliant.

Bank stocks gained. Stocks of private sector banks edged higher. Axis Bank (up 4.53%), ICICI Bank (up 10.43%) and HDFC Bank (up 4.13%) edged higher.

State Bank of India (SBI) jumped 14.06%. The bank's net profit fell 66.23% to Rs 1263.81 crore on 10.10% increase in total income to Rs 53526.97 crore in Q4 March 2016 over Q4 March 2015. The result was announced during trading hours on Friday, 27 May 2016. The bank's gross non-performing assets (NPAs) stood at Rs 98172.80 crore as on 31 March 2016 as against Rs 72791.73 crore as on 31 December 2015 and Rs 56725.34 crore as on 31 March 2015. The ratio of gross NPA to gross advances stood at 6.5% as on 31 March 2016 as against 5.1% as on 31 December 2015 and 4.25% as on 31 March 2015. The ratio of net NPA to net advances stood at 3.81% as on 31 March 2016 as against 2.89% as on 31 December 2015 and 2.12% as on 31 March 2015. The bank's provisions and contingencies rose 89.74% to Rs 13174.05 crore in Q4 March 2016 over Q4 March 2015. The provisions and contingencies include provisions for NPA. SBI's provisions for NPA jumped 143.47% to Rs 12139.17 crore in Q4 March 2016 over Q4 March 2015. The provision coverage ratio of the bank stood at 60.69% as on 31 March 2016.

The S&P BSE Bankex rose 6.46% during the week. Global credit rating agency Moody's Investors Service said in a report that the new bankruptcy code will address several key inefficiencies in the current legal framework for asset resolution in India and is credit positive for Indian banks. Moody's said that the proposed bankruptcy law will reduce the duration of insolvency resolution process (IRP) of a delinquent borrower to maximum of 270 days which in turn will strengthen the banks' bargaining power over delinquent borrowers. The bankruptcy law will give creditors overriding authority to approve terms of any restructuring package of a delinquent borrower. Moody's also said that new law may only a have a limited benefit in addressing the current asset quality issues facing Indian banks. According to Moody's, Indian banks will still have limited avenues available to dispose off distressed assets and that the banks will in general remain reluctant to make appropriate haircuts to reflect their current weak operating conditions.

Tata Steel rose 1.89%. The company trimmed losses in Q4 March 2016. The company reported consolidated net loss of Rs 3213.76 crore in Q4 March 2016, lower than net loss of Rs 5674.29 crore in Q4 March 2015. Tata Steel's total income fell 12.33% to Rs 29636.69 crore in Q4 March 2016 over Q4 March 2015. The result was announced after market hours on Wednesday, 25 May 2016.

Shares of two-wheeler maker Bajaj Auto jumped 4.33%. The company's net profit rose 29% to Rs 803 crore on 13% growth in turnover to Rs 5536 crore in Q4 March 2016 over Q4 March 2015. Operating EBITDA (earnings before interest, taxes, depreciation and amortization) before mark-to-market gains/losses on foreign currency transactions jumped 34% to Rs 1259 crore in Q4 March 2016 over Q4 March 2015. The operating EBITDA margin surged to 23.1% in Q4 March 2016 from 19.4% in Q4 March 2015. The result was announced during market hours on Wednesday, 25 May 2016.

Maruti Suzuki India rose 4.92%. The company announced during trading hours on Friday, 27 May 2016, that it will recall 75,419 Baleno cars and 1,961 DZire cars (only AGS variant). The company will proactively and voluntarily recall 75,419 Baleno cars (petrol and diesel) manufactured between 3 August 2015 and 17 May 2016 to upgrade the airbag controller software. Of these, 15,995 Baleno cars (only diesel), manufactured between 3 August 2015 and 22 March 2016 will also be attended to for inspection and replacement of a faulty fuel filter. The Baleno cars covered in the recall include 17,231 units of exports. In addition, 1,961 DZire diesel cars (only AGS variant) will be attended to for inspection and replacement of a faulty fuel filter. Starting 31 May 2016, the owners of the vehicles covered will be contacted by Maruti Suzuki dealers. The software upgrade and the replacement of faulty fuel filter, will be done free of cost, the company said.

Cipla lost 6.62%. The company's consolidated net profit fell 68.9% to Rs 81 crore on 5.6% growth in income from operations to Rs 3267 crore in Q4 March 2016 over Q4 March 2015. The company's earnings before interest, taxation, depreciation and amortization (EBITDA) declined 56.9% to Rs 219 crore in Q4 March 2016 over Q4 March 2015. The result was announced after market hours on Tuesday, 24 May 2016.

Prime Minister Narendra Modi said he had opened up more of the economy to foreign investment and made changes to curb corruption, fill gaps in rural infrastructure and make it easier to do business. He also said that he has an enormous task ahead. The Prime Minister said that he expects the goods and services tax (GST) bill to pass this year. The BJP led National Democratic Alliance (NDA) government completed two years in office on Thursday, 26 May 2016.

A foreign brokerage upgraded the Indian equity market to 'overweight' from 'equalweight'. According to media reports, the brokerage has cited attractive valuations of Indian stocks compared with other emerging markets, the country's strong macroeconomic fundamentals, a recovery in earnings growth, prospects for the passage of the goods and services tax (GST) bill in the Rajya Sabha, expectation of good monsoon this year and likely further easing of interest rates by the Reserve Bank of India (RBI) as reasons for upgrading India's rating. The Sensex jumped 575.70 points or 2.28% to settle at 25,881.17, its highest closing level since 27 April 2016.

Private weather forecaster Skymet on Tuesday, 24 May 2016 revised higher forecast for the 2016 southwest monsoon to 109% of the long period average (LPA) from 105% of the LPA predicted earlier. Skymet said that conditions are favorable for the timely onset of the southwest monsoon in Kerala. This is in contrast with state-run weather office the India Meteorological Department (IMD) predicting a delay of 6 days for the onset of the monsoon rains in Kerala this year from the normal onset date which is 1 June. The IMD also, last month, forecast good rains during the 2016 southwest monsoon season. Skymet has cut its forecast of the quantum of rains in June 2016 to 87% of LPA from its earlier prediction of 90% of LPA. It has raised its forecast of the quantum of rains in July 2016 to 108% of LPA from earlier 105%. For August 2016, Skymet has raised its forecast to 113% of LPA from earlier 108%. For September 2016, Skymet has raised its forecast to 123% of LPA from earlier 115%.

On the global front, Eurozone finance ministers and the International Monetary Fund (IMF) reached a deal to unlock more bailout funds for debt-burdened Greece. The new payouts will save Greece from defaulting on big debt redemptions to the IMF and European Central Bank in July. Eurozone finance ministers also agreed on a road map on debt relief for Greece.

Data released on Monday, 23 May 2016 showed a slowdown in economic activity in the eurozone in May 2016. Data provider Markit said a headline measure of activity based on surveys of 5,000 companies around the eurozone, known as the composite purchasing managers index, fell to 52.9 in May from 53 in April. A reading above 50 indicates an increase in activity, while a reading below that level indicates a decline.

THE END SESSION ( 27 / 05 )

Sensex, Nifty attain highest closing level in nearly 7 months

Stocks of public sector banks, pharma companies, crude oil refiners and index heavyweights Infosys and HDFC led the latest upmove on the bourses. The barometer index, the S&P BSE Sensex, rose 286.92 points or 1.09% to settle at 26,653.60. The Nifty 50 index rose 87 points or 1.08% to settle at 8,156.65. Gains in Asian and European stocks aided the upmove on the domestic bourses. Asian and European stocks edged higher after better-than-expected US economic reports overnight. The US economy is the world's biggest economy. With fourth straight trading session of gains, the Sensex and the Nifty, both, attained their highest closing level in nearly seven months.

Sun Pharmaceutical Industries surged after the company's US subsidiary Taro Pharmaceutical Industries posted strong financial performance for the year ended 31 March 2016. The State Bank of India stock surged, shrugging off weak financial performance for Q4 March 2016. BPCL jumped 9.12% after the company's board of directors recommended issue of 1:1 bonus shares at the time of announcement of its Q4 March 2016 results after trading hours yesterday, 26 May 2016.

Index heavyweight Reliance Industries (RIL) edged higher on reports that the company is preparing to restart work in four offshore oil and gas blocks, including one of India's biggest natural gas discoveries, as it seeks to revive development activity stalled for seven years by disputes with the government.

In overseas stock markets, Asian and European stocks edged higher after better-than-expected US economic reports overnight. The US economy is the world's biggest economy. US equities took a breather yesterday, 26 May 2016, following their steepest two-day advance since March as investors parsed a slew of economic reports. The latest data showed US durable goods orders, housing and initial jobless claims data coming in strong, while capital goods orders and the Kansas City Fed manufacturing survey were weak.

The Sensex rose 286.92 points or 1.09% to settle at 26,653.60, its highest closing level since 30 October 2015. The index jumped 310.75 points, or 1.18% at the day's high of 26,677.43. The index rose 38.60 points, or 0.15% at the day's low of 26,405.28.

The Nifty 50 index rose 87 points or 1.08% to settle at 8,156.65, its highest closing level since 28 October 2015. The index rose 94.55 points, or 1.17% at the day's high of 8,164.20. The index rose 7.40 points, or 0.09% at the day's low of 8,077.05.

The BSE Mid-Cap index rose 1.39%, outperforming the Sensex. The BSE Small-Cap index rose 0.57%, underperforming the Sensex.

The market breadth indicating the overall health of the market was positive. On BSE, 1,417 shares rose and 1,157 shares fell. A total of 197 shares were unchanged.

Among the sectoral indices on BSE, the S&P BSE Bankex (up 1.15%), the S&P BSE Metal index (up 1.18%), the S&P BSE Finance index (up 1.37%), the S&P BSE Realty index (up 1.51%), the S&P BSE Healthcare index (up 2.42%), the S&P BSE Energy index (up 2.44%) and the S&P BSE Oil & Gas index (up 2.66%), outperformed the Sensex. The S&P BSE Telecom index (down 0.04%), the S&P BSE FMCG index (down 0.01%), the S&P BSE Utilities index (up 0.18%), the S&P BSE Capital Goods index (up 0.49%), the S&P BSE Power index (up 0.50%), the S&P BSE Industrials index (up 0.67%), the S&P BSE Consumer Discretionary Goods & Services index (up 0.76%), the S&P BSE Teck index (up 0.84%), the S&P BSE IT index (up 0.91%), the S&P BSE Auto index (up 0.94%) and the S&P BSE Basic Materials index (up 1.04%), underperformed the Sensex

The total turnover on BSE amounted to Rs 3359 crore, higher than turnover of Rs 2928.58 crore registered during the previous trading session.

Bharat Heavy Electricals (Bhel) fell 0.19% to Rs 128.20. The company's net profit fell 59.52% to Rs 359.58 crore on 18.36% decline in total income to Rs 10418.64 crore in Q4 March 2016 over Q4 March 2015. The result was announced after trading hours today, 27 May 2016. Bhel's order backlog stood at about Rs 1.10 lakh crore as on 31 March 2016. The company removed orders amounting Rs 3783 crore from the order book in Q4 March 2016. It removed orders amounting Rs 7429 crore from the order book in the year ended 31 March 2016, which are not likely to commence.

Pharmaceutical stocks edged higher. Divi's Laboratories (up 3.88%), Piramal Enterprises (up 3.42%), Wockhardt (up 3.09%), Aurobindo Pharma (up 2.65%), Cadila Healthcare (up 2.19%), GlaxoSmithKline Pharmaceuticals (up 1.36%), Cipla (up 1.29%), Glenmark Pharmaceuticals (up 1.11%), Strides Shasun (up 0.93%) and Dr Reddy's Laboratories (up 0.72%) edged higher. Alkem Laboratories (down 0.83%) and IPCA Laboratories (down 1.2%), edged lower.

Sun Pharmaceutical Industries rose 5.83% at Rs 825.50 after the company's US subsidiary Taro Pharmaceutical Industries posted strong financial performance for the year ended 31 March 2016. Taro Pharmaceutical Industries' consolidated net profit rose 11.69% to $540.9 million on 10.2% growth in net sales to $950.80 million in the year ended 31 March 2016 over the year ended 31 March 2015. The result was announced yesterday, 26 May 2016. Taro reportedly contributes around 32% of the US turnover of Sun Pharma.

Lupin rose 0.72% at Rs 1,480.70 after the company announced during trading hours today, 27 May 2016, that it has received Establishment Inspection Reports (EIR) for its Mandideep and Aurangabad facilities wherein the U S Food and Drug Administration (USFDA) has concluded that the inspections stand closed. The USFDA had conducted audits at Lupin's Mandideep facility from 8 to 19 February 2016 and its Aurangabad facility from 11 to 15 January 2016. Lupin said that the company had taken appropriate steps to address the observations it had received from these audits. Having received the EIRs from the USFDA about the closure of these inspections, all observations stand addressed and both these facilities are cGMP compliant.

Bank stocks edged higher on renewed buying. Among state-run banks, Allahabad Bank (up 4.36%), Syndicate Bank (up 3.89%), Union Bank of India (up 3.61%), IDBI Bank (up 2.90%), Dena Bank (up 2.79%), Bank of Baroda (up 2.78%), Indian Bank (up 2.78%), Andhra Bank (up 2.72%), Punjab National Bank (up 2.68%), Bank of India (up 2.53%), United Bank of India (up 2.27%), UCO Bank (up 2.07%), Central Bank of India (up 1.30%), Corporation Bank (up 0.99%), Vijaya Bank (up 0.66%) and Bank of Maharashtra (up 0.18%), edged higher. Punjab and Sind Bank (down 0.99%) and Canara Bank (down 2.94%), edged lower.

State Bank of India (SBI) rose 6.42% at Rs 195.55. The bank's net profit fell 66.23% to Rs 1263.81 crore on 10.10% increase in total income to Rs 53526.97 crore in Q4 March 2016 over Q4 March 2015. The result was announced during trading hours today, 27 May 2016.

The bank's gross non-performing assets (NPAs) stood at Rs 98172.80 crore as on 31 March 2016 as against Rs 72791.73 crore as on 31 December 2015 and Rs 56725.34 crore as on 31 March 2015. The ratio of gross NPA to gross advances stood at 6.5% as on 31 March 2016 as against 5.1% as on 31 December 2015 and 4.25% as on 31 March 2015. The ratio of net NPA to net advances stood at 3.81% as on 31 March 2016 as against 2.89% as on 31 December 2015 and 2.12% as on 31 March 2015.

The bank's provisions and contingencies rose 89.74% to Rs 13174.05 crore in Q4 March 2016 over Q4 March 2015. The provisions and contingencies include provisions for NPA. SBI's provisions for NPA jumped 143.47% to Rs 12139.17 crore in Q4 March 2016 over Q4 March 2015. The provision coverage ratio of the bank stood at 60.69% as on 31 March 2016.

Among private sector banks, City Union Bank (up 2.45%), Kotak Mahindra Bank (up 1.98%), ICICI Bank (up 0.96%), Yes Bank (up 0.81%), HDFC Bank (up 0.50%) and IndusInd Bank (up 0.02%), edged higher. Axis Bank fell 1.17%.

Index heavyweight and housing finance major HDFC rose 2.43% to Rs 1,257.30. The stock hit a high of Rs 1,266.50 and a low of Rs 1,219.05 in intraday trade.

IT stocks edged higher on renewed buying. MphasiS (up 4.20%), HCL Technologies (up 1.89%), Hexaware Technologies (up 1.22%), Infosys (up 1.20%), TCS (up 0.75%), Persistent Systems (up 0.42%), MindTree (up 0.41%), Oracle Financial Services Software (up 0.19%) and Wipro (up 0.15%) edged higher. Tech Mahindra fell 1.10%.
Most auto stocks edged higher. Ashok Leyland (up 2.50%), Bajaj Auto (up 2.49%), Eicher Motors (up 1.79%), Tata Motors (up 1.05%) and Hero MotoCorp (up 1.01%), edged higher. Mahindra & Mahindra (down 0.15%), Escorts (down 0.2%) and TVS Motor Company (down 2.21%),

Maruti Suzuki India rose 0.59% at Rs 4141.35 . The company announced during trading hours today, 27 May 2016, that it will recall 75,419 Baleno cars and 1,961 DZire cars (only AGS variant). The company will proactively and voluntarily recall 75,419 Baleno cars (petrol and diesel) manufactured between 3 August 2015 and 17 May 2016 to upgrade the airbag controller software. Of these, 15,995 Baleno cars (only diesel), manufactured between 3 August 2015 and 22 March 2016 will also be attended to for inspection and replacement of a faulty fuel filter. The Baleno cars covered in the recall include 17,231 units of exports.

In addition, 1,961 DZire diesel cars (only AGS variant) will be attended to for inspection and replacement of a faulty fuel filter. Starting 31 May 2016, the owners of the vehicles covered will be contacted by Maruti Suzuki dealers. The software upgrade and the replacement of faulty fuel filter, will be done free of cost, the company said.

Stocks of oil exploration and production (E&P) firms were mixed. Cairn India fell 2.02%. Oil India rose 0.43%.

Brent for July settlement was currently down 78 cents at $48.81 a barrel. The contract had declined 15 cents or 0.3% to settle at $49.59 a barrel during the previous trading session.

Index heavyweight Reliance Industries (RIL) gained 2.75% to Rs 972.65 on reports that the company is preparing to restart work in four offshore oil and gas blocks, including one of India's biggest natural gas discoveries, as it seeks to revive development activity stalled for seven years by disputes with the government. The company plans to drill 21 wells in four offshore areas, including the deepwater KG-D6 block in the Bay of Bengal, according to reports. RIL aims to initially focus on parts of the KG-D6 block known as the R-cluster, satellite and MJ discoveries. It plans to finalize the investment and work plan by the end of this year.

ONGC edged lower in volatile trade in the aftermath of the announcement of its Q4 March 2016 results. The stock was off 1.64% at Rs 213.15 . The stock had risen 3.09% to settle at Rs 216.70 yesterday, 26 May 2016, after the result hit the market at the fag end of the trading session. The company's net profit rose 12.22% to Rs 4416.11 crore on 15.42% decline in total income to Rs 19776.70 crore in Q4 March 2016 over Q4 March 2015. ONGC's net profit fell 9.75% to Rs 16003.65 crore on 4.14% decline in total income to Rs 84584.99 crore in the year ended 31 March 2016 over the year ended 31 March 2015.

In terms of the decision of the Government of India, the company shared under-recoveries of oil marketing companies (OMCs) amounting to Rs 1096 crore for the year ended March 2016 (FY 2016) by allowing discount in the prices of crude oil based on the rates of discount communicated by Petroleum Planning and Analysis Cell (PPAC). The discount was sharply lower than Rs 36300 crore in the year ended 31 March 2015 (FY 2015). The impact on net profit was Rs 607 crore in FY 2016 as compared to Rs 20437 crore in FY 2015.

ONGC's consolidated net profit fell 22.96% to Rs 14123.80 crore on 16.63% decline in total income to Rs 139364.35 crore in the year ended 31 March 2016 over the year ended 31 March 2015.

BPCL rose 9.12 % after the company's board of directors recommended issue of 1:1 bonus shares at the time of announcement of its Q4 March 2016 results after trading hours yesterday, 26 May 2016. BPCL revised its record date for issuing bonus shares to 14 July 2016, from 11 July 2016 earlier. BPCL's net profit fell 10.64% to Rs 2549.08 crore on 13.55% decline in total income to Rs 44891.65 crore in Q4 March 2016 over Q4 March 2015. The average gross refining margin (GRM) for Q4 March 2016 fell to $6.30 per barrel from $ 7.85 per barrel in Q4 March 2015.

HPCL rose 9.81%. HPCL's net profit fell 28.18% to Rs 1552.94 crore on 6.63% decline in total income to Rs 42603.09 crore in Q4 March 2016 over Q4 March 2015. The result was announced during market hours today, 27 May 2016. HPCL's bottom line during the quarter was adversely impacted by lower other income or non-operational income. Other income declined 59.83% to Rs 407.85 crore in Q4 March 2016 over Q4 March 2015.

The Sensex and the Nifty edged higher for the fourth day in a row. The Sensex has gained 1,423.24 points or 5.64% in four trading sessions from its close of 25,230.36 on 23 May 2016. The Sensex has gained 1,050.98 points or 4.1% in this month so far (till 27 May 2016). The Sensex has risen 541.06 points or 2.07% in calendar year 2016 so far (till 27 May 2016). From a 52-week low of 22,494.61 hit on 29 February 2016, the barometer index has risen 4,161.99 points or 18.50%. The Sensex is off 1,922.73 points or 6.73% from a 52-week high of 28,578.33 hit on 23 July 2015. The Sensex is off 3,370.14 points or 11.22% from a record high of 30,024.74 hit on 4 March 2015.

THE END SESSION ( 26 / 05 )

Benchmark indices settle above key levels

Prime Minister Narendra Modi's comments in an interview to a foreign newspaper indicating that further economic reforms are on the cards triggered the latest rally on the domestic bourses. The barometer index, the S&P BSE Sensex, surged 485.51 points or 1.88% to settle at 26,366.68. The gains for the Sensex were higher in percentage terms than those for the Nifty 50 index. The Nifty surged 134.75 points or 1.7% to settle at 8,069.65. The Nifty moved past the the psychologically important 8,000 level and the Sensex surpassed the psychologically important 26,000 mark. The Nifty hit a 30-week closing high. The Sensex attained its highest closing level in more than 29 weeks.

Modi said he had opened up more of the economy to foreign investment and made changes to curb corruption, fill gaps in rural infrastructure and make it easier to do business. He also said that he has an enormous task ahead. The Prime Minister said that he expects the goods and services tax (GST) bill to pass this year. The BJP led National Democratic Alliance (NDA) government completed two years in office today, 26 May 2016. The prime minister said that he would look to state governments to further liberalize the country's rigid labour laws.

Strong Q4 March 2016 results from engineering and construction major L&T and the company's guidance of a 15% growth in order inflow during the current financial year also aided the latest rally on the bourses. L&T shares surged 13.85% after the company announced the results and the order inflow guidance after trading hours yesterday, 25 May 2016.

The Sensex and the Nifty extended gains during the second half of the trading session after hovering in positive zone throughout the trading session after opening with upward gap.

Capital goods stocks edged higher after the Union Cabinet approved the National Capital Goods policy to support and boost development of this crucial sector. Bank stocks edged higher after global credit rating agency Moody's Investors Service said in a report that the new bankruptcy code will address several key inefficiencies in the current legal framework for asset resolution in India and is credit positive for Indian banks. Yes Bank edged higher after the Cabinet Committee on Economic Affairs cleared the bank's proposal for increase in foreign investment limit in the bank's equity capital to 74% from 41.87% without any sub-limits.

In overseas stock markets, Asian and European stocks edged higher as gains in crude oil prices boosted investors' risk appetite. Energy and materials shares sector stocks led gains in US stocks yesterday, 25 May 2016, following a jump in crude oil prices triggered by a weekly report showing a decline in US crude inventories.

The Sensex surged 485.51 points or 1.88% to settle at 26,366.68, its highest closing level since 4 November 2015. The Sensex jumped 517.77 points, or 2% at the day's high of 26,398.94. The index rose 60.34 points, or 0.23% at the day's low of 25,941.51.
The Nifty surged 134.75 points or 1.7% to settle at 8,069.65, its highest closing level since 29 October 2015. The Nifty jumped 148.10 points, or 1.87% at the day's high of 8,083. The index rose 13.60 points, or 0.17% at the day's low of 7,948.50.

The market breadth indicating the overall health of the market was positive. On BSE, 1,408 shares rose and 1,142 shares fell. A total of 197 shares were unchanged. The BSE Mid-Cap index rose 1%. The BSE Small-Cap index rose 0.86%. Both these indices underperformed the Sensex.

The total turnover on BSE amounted to Rs 2920 crore, higher than turnover of Rs 2323.39 crore registered during the previous trading session.

Among the sectoral indices on BSE, the S&P BSE Capital Goods index (up 8.78%), the S&P BSE Industrials index (up 3.97%), the S&P BSE Bankex (up 2.22%) and the S&P BSE Finance index (up 1.89%) outperformed the Sensex. The S&P BSE Realty index (up 1.82%), the S&P BSE Power index (up 1.51%), the S&P BSE FMCG index (up 1.23%), the S&P BSE IT index (up 1.23%), the S&P BSE Teck index (up 1.14%), the S&P BSE Auto index (up 1.09%), the S&P BSE Oil & Gas index (up 0.96%), the S&P BSE Metal index (up 0.89%), the S&P BSE Basic Materials index (up 0.85%), the S&P BSE Consumer Discretionary Goods & Services index (up 0.84%), the S&P BSE Utilities index (up 0.77%), the S&P BSE Energy index (up 0.49%), the S&P BSE Telecom index (up 0.4%) and the S&P BSE Consumer Durables index (up 0.07%) underperformed the Sensex. The S&P BSE Healthcare index ended almost unchanged at 15,098.72, underperforming the Sensex.

Capital goods stocks edged higher after the Union Cabinet approved the National Capital Goods policy to support and boost development of this crucial sector. ABB India (up 1.83%), Bharat Heavy Electricals (Bhel) (up 4.77%), BEML (up 1.02%), Bharat Electronics (up 1.02%), Punj Lloyd (up 2.15%), Siemens (up 4.13%) and Thermax (up 3.19%) gained. Crompton Greaves fell 1.23%.

The National Capital Goods policy aims at increasing production of capital goods from Rs 2.30 lakh crore in 2014-15 to Rs 7.50 lakh crore in 2025 and raising direct and indirect employment from the current 8.4 million to 30 million. The policy envisages increasing exports from the current 27% to 40% percent of production. It will increase the share of domestic production in India's demand from 60% to 80%, thus making India a net exporter of capital goods.

L&T spurted after the company's management said in a conference call held after the announcement of the company's Q4 March 2016 results yesterday, 25 May 2016, that it expects L&T's order inflow to rise 15% in the year ending 31 March 2017 (FY 2017). 

The stock jumped 13.85% to Rs 1,470.10. The stock hit a high of Rs 1,484 and a low of Rs 1,389.75 in intraday trade. L&T expects 12-15% growth in revenue in the year ending 31 March 2017 (FY 2017). L&T reported 18.55% rise in consolidated net profit to Rs 2453.64 crore on 17.88% rise in total income to Rs 33375.26 crore in Q4 March 2016 over Q4 March 2015. The result was announced after market hours yesterday, 25 May 2016.

L&T said that the order inflow during Q4 March 2016 was Rs 43334 crore of which one third constituted international orders. The order intake of L&T's infrastructure division rose just 3% at Rs 29103 crore in Q4 March 2016 over Q4 March 2015. The order intake of its hydrocarbon divsion rose sharply to Rs 4963 crore in Q4 March 2016 from Rs 699 crore in Q4 March 2015.

L&T's order book stood at Rs 249949 crore as on 31 March 2016, higher by 7% on year-on-year basis. International order book constituted 28% of the total order book.
L&T said in a statement that the company continues its emphasis on operational efficiencies, faster execution of projects on hand and reduced working capital levels. Given its track record, diversified portfolio and healthy order book, the company is focusing on profitable execution of the existing order book and is confident of its growth in the near to medium term by leveraging its presence in both the domestic and international segments.

State-run ONGC rose 2.05% to Rs 214.50 after net profit rose 12.22% to Rs 4416.11 crore on 15.42% decline in total income to Rs 19776.70 crore in Q4 March 2016 over Q4 March 2015. The result was announced at the fag end of the trading session today, 26 May 2016.

ONGC's net profit fell 9.75% to Rs 16003.65 crore on 4.14% decline in total income to Rs 84584.99 crore in the year ended 31 March 2016 over the year ended 31 March 2015.

In terms of the decision of the Government of India, the company shared under-recoveries of oil marketing companies (OMCs) amounting to Rs 1096 crore for the year ended March 2016 (FY 2016) by allowing discount in the prices of crude oil based on the rates of discount communicated by Petroleum Planning and Analysis Cell (PPAC). The discount was sharply lower than Rs 36300 crore in the year ended 31 March 2015 (FY 2015). The impact on net profit was Rs 607 crore in FY 2016 as compared to Rs 20437 crore in FY 2015.

ONGC's consolidated net profit fell 22.96% to Rs 14123.80 crore on 16.63% decline in total income to Rs 139364.35 crore in the year ended 31 March 2016 over the year ended 31 March 2015.

Bank stocks edged higher after global credit rating agency Moody's Investors Service said in a report that the new bankruptcy code will address several key inefficiencies in the current legal framework for asset resolution in India and is credit positive for Indian banks. Among public sector banks, State Bank of India (up 5.22%), Canara Bank (up 2.51%), Bank of Baroda (up 1.28%), Vijaya Bank (up 1.67%), Union Bank of India (up 1.51%), Bank of India (up 2.41%), Punjab National Bank (up 0.74%), Andhra Bank (up 2.67%), IDBI Bank (up 0.46%) edged higher.

Among private sector banks, Federal Bank (up 4.15%), ICICI Bank (up 1.83%), Axis Bank (up 3.78%), Kotak Mahindra Bank (up 3.05%), IndusInd Bank (up 0.66%) and HDFC Bank (up 0.84%) edged higher.

Moody's said that the proposed bankruptcy law will reduce the duration of insolvency resolution process (IRP) of a delinquent borrower to maximum of 270 days which in turn will strengthen the banks' bargaining power over delinquent borrowers. The bankruptcy law will give creditors overriding authority to approve terms of any restructuring package of a delinquent borrower. Moody's also said that new law may only a have a limited benefit in addressing the current asset quality issues facing Indian banks. According to Moody's, Indian banks will still have limited avenues available to dispose off distressed assets and that the banks will in general remain reluctant to make appropriate haircuts to reflect their current weak operating conditions.

Yes Bank rose 2.93% after the Cabinet Committee on Economic Affairs cleared the bank's proposal for increase in foreign investment limit in the bank's equity capital to 74% from 41.87% without any sub-limits. In late April 2016, the Reserve Bank of India (RBI) had raised the ceiling on investment in the bank's equity capital by foreign institutional investors to 60% from 49% after the bank's board of directors and shareholders approved the proposal. The RBI had at time capped total foreign holding in the bank from all sources at 60%

Tata Steel rose 0.83% at Rs 327.05 after the company trimmed losses in Q4 March 2016. The company reported consolidated net loss of Rs 3213.76 crore in Q4 March 2016, lower than net loss of Rs 5674.29 crore in Q4 March 2015. Tata Steel's total income fell 12.33% to Rs 29636.69 crore in Q4 March 2016 over Q4 March 2015. The result was announced after market hours yesterday, 25 May 2016.

There was a drop in realisations from steel sales across the group as steel prices slid to 10-year lows. However, despite these challenges, the consolidated earnings before interest, taxes, depreciation and amortization (EBITDA) increased in Q4 March 2016 on the back of higher deliveries and better operating margins in India, cost benefits from European restructuring and improved performance of the South East Asia operations. The company continued to divest its non-core assets and raised Rs 4478 crore through monetisation of same.

Given the challenging situation faced in Europe, the company has taken several steps to restructure the European operations. Tata Steel UK signed an agreement with Greybull Capital to sell its Long Products Europe business. The deal will be completed once a number of outstanding conditions have been resolved, including transfer of contracts, certain Government approvals and the satisfactory completion of financing arrangements. The Tata Steel Europe board under the advise of the Tata Steel board is actively reviewing all options for the Tata Steel UK Business including a potential sale of the business.

Tata Steel announced the start of commercial production at the 3 million tonnes per annum (mtpa) Kalinganagar steel plant. The stabilisation process is currently underway. The facility will produce flat steel for high end applications enabling the company to expand its product portfolio in the ship building, defence equipment, energy & power, infrastructure, and aviation sectors. It will also consolidate Tata Steel's leadership position in the domestic automotive segment.

KNR Constructions rose 2.52% after the company secured order worth Rs 414.90 crore from Ministry of Road Transport and Highways for rehabilitation and up-gradation of Dindigul-Bangalore road to four lane with paved shoulder in Tamil Nadu on engineering, procurement and construction basis to be completed within a period of 24 months from the appointed date.

The Sensex and the Nifty edged higher for the third day in a row. The Sensex has gained 1136.32 points or 4.5% in three trading sessions from its close of 25,230.36 on 23 May 2016. The Sensex has gained 760.06 points or 2.96% in this month so far (till 26 May 2016). The Sensex has risen 249.14 points or 0.95% in calendar year 2016 so far (till 26 May 2016). From a 52-week low of 22,494.61 hit on 29 February 2016, the barometer index has risen 3,872.07 points or 17.21%. The Sensex is off 2,211.65 points or 7.73% from a 52-week high of 28,578.33 hit on 23 July 2015. The Sensex is off 3,658.06 points or 12.18% from a record high of 30,024.74 hit on 4 March 2015.