Stocks In Action, 17 October 2012

Tata Motors faced a hit recently due to disappointing sales numbers domestically and internationally. The company’s YoY sales volume growth witnessed a decline in September 2012 sending stock prices lower. As the festive season approaches though, auto stocks have been on a positive note due to an expected reversal in trend. The head of the company’s domestic business said yesterday that Tata Motors will look to rationalise its product range and overhaul its range. The company is set to reviving the sputtering local business in a fiercely competitive market, reported Business Standard. This hearing up would result in volatility in the stock prices of Tata Motors today, with a likely upward move.

Zensar Technologies yesterday announced their Q2FY13 results which reported a 1 per cent growth in revenues on a sequential basis. The company’s net profit decline by 41 per cent as compared to the quarter ended June 2012. This would send the stock price of Zensar lower today. It has already seen a 3 per cent decline yesterday but since the announcement was made post closing of markets, it would result in some more downward pressure today.

Tata Metaliks yesterday said that their revenues came down from Rs.344.58 crore in Q2FY12 to Rs.213.77 crore in Q2FY13. Its net loss was seen at Rs.16.29 crore in Q2FY13 as compared to Rs.51.61 crore in the corresponding period in the previous year. This would result in increased volatility in the stock price of Tata Metaliks with a downward bias.

Maruti’s disaster stricken Manesar plant is expected to reach full capacity in 2-3 days. The next couple of days are to mark the second shift of operations after operations on the second shift commenced yesterday. The company is currently rolling out 1350 cars per day and this is expected to reach 1600-1700 units per day in the next couple of days. Moreover, the company said it is to complete regularisation of contract workers at the facility by December. Also, the company’s new Alto 800 has received a tremendous response with more than 10000 pre launch bookings. This would result in an upward trend in Maruti Suzuki India Limited’s stock prices today.

Among major companies to announce results today are BPL, Crisil, HCL Tech, Infotech and Karnataka Bank. These stocks are likely to see increased volatility in today’s trading session. The direction of movement though would be defined by the results they announce.