Stocks In Action: July 13, 2012

IT giant TCS yesterday came out with its Q1 results, reflecting handsome growth of 14.6 per cent at Rs 3,318 crore in its net profit. The revenues for the quarter were at Rs 14,869 crore as against Rs 13,295 crore in the previous quarter. The operating margins were at 27.5 per cent as against 27.62 per cent in the previous quarter. TCS has also declared interim dividend of Rs 3 per share. It has also added 29 new clients. The results are in line with the street expectations. The management seemed optimistic about the demand for its products and services across the globe. We expect the shares of the company to show gains today.

The shares of Infosys which tanked by almost 10 per cent after the announcement of its results may further slip down as it is clear from the results of TCS that Infosys is in hot waters as compared to its competitor. Its sequential growth in the constant currency terms was lower and hence investors pushed the price down by selling their holdings. We may see further selling today and the stock may remain negative.

Business Standard has reported that the numbers of customers leaving Reliance Infrastructure (R-Infra) have been steadily growing and that each day Tata Power receives about 300 changeover applications from R-Infra customers. This is a financial and physical loss to R-Infra and on the back of this news the shares of the company may show flat to negative trades. Tata Power, on the other hand, may show some positive bias.

According to Business Line, Welspun Corporation has proposed to raise NCDs worth Rs 1,000 crore. The proceeds will be used to repay its external commercial borrowings and maybe the early redemption of its foreign currency convertible bonds. The news may make the stock show high volumes with volatility.

The shares of Geometric may show a positive bias after it announced that it has launched an automated design for manufacturing solutions called DFMPro® for NX™ software – Siemens’ PLM software’s solution for integrated computer-aided design manufacturing and engineering.

Capital goods giant L&T may show positive trades over the news that it has expanded its electrical and automation capacity by inaugurating a new facility at Vadodara.

The shares of automobile companies may tumble because of the news that there would be another diesel price hike after July 19.