Stocks In Action For August 27, 2012
DSIJ Intelligence / 27 Aug 2012
According to economic times, IT companies are being forced to subcontract more work than ever before in the US. This has made it harder and costlier for Indian software professionals to travel on work to their main market. For the Indian companies this will have an impact on its margins as subcontracting means to use US staffing rather than using its own employees. This will also erode their competitive advantage in these tough times. We expect some negative impact of this on the shares of IT companies particularly Infosys.
According to Mint, Suzuki Motor’s chairman Osamu Suzuki has said that it will stay invested in the state of Haryana. After a high profile meeting with the government and company officials, the company also said that it has invested at least Rs.1,700 crore for a research and development (R&D) centre at Rohtak in Haryana. The troubled Manesar will have the third (assembly) line. Suzuki’s motorcycle plant will also come up and be expanded in Rohtak. A total investment is about Rs 7000 crore. Maruti is also investing in Gujarat for a new assembly line, which will be operational by 2015-16. This gives too much of the positives for the stock to show some positivity today in the trades.
Pharma sector may show bullish sentiment over the news that the Indian companies are now focusing more on the high margin Formulations business than the low margin API business. The news article says that the API products are now taking shift to China as it offers 15-20 per cent discount. Indian companies like Sun Pharma, Lupin, and Aurobindo Pharma etc have now lower contribution of API in their business. This will boost the Pharma stocks today.
Shares of Claris India may jump today on the back of the clarification that it has filed. The company has said that it wishes to sell all its products by itself. Earlier Pfizer has called off a distribution agreement with Claris. The filing came in on Friday we see a potential upturn in the stock price.
Cadila Healthcare may further also show jump on the news that it has entered in an agreement with Microbix for re-launching of Urokinase, a critical care therapy in North America.
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