Index Trends And Stocks In Action 7th February 2013

Indian markets on Wednesday witnessed a volatile session. The Nifty slipped from intraday highs of 5991 to end flat with a positive bias. It ended with a marginal gain of 0.04% at 5959. Trading in a narrow range-bound manner has been witnessed on the Nifty in the last two-three trading sessions. Whereas the higher range for nifty is 5990, the lower range stands at 5945. This trading range will act as a breakout or a break down point in coming trading session.  Once Nifty breaks levels of 5940-5945, markets may drift down to levels of 5880. On the higher side, if the Nifty breaks above 5990, it may touch levels of 6020-6050.

Uttam Galva, which has acquired a 58.35% stake in Lloyds Steel, has planned to raise Rs 1500-2000 crore of working capital for the acquired entity. It is in discussion with public sector banks for raising the same and it hopes to close this deal by the end of the current quarter. Based on this announcement made by Uttam Galva, we expect its stock to remain volatile for the day.

Rajesh Exports has secured an order worth Rs 432 crore from Al Malek Jewellery, UAE for the export of gold and diamond jewellery. It reported that the order is to be executed by March 31 and that it would significantly impact its bottomline. The order would be met though the company’s manufacturing facility in Bangalore. This announcement is likely to causes added volatility in the stock prices of Rajesh Exports today.

According to media reports, Tata Power and Rockwell Collins Inc are jointly to bid for a contract which is expected to be worth USD150 million to USD200 million. The contract is for the supply of radio equipment to the Indian Air Force. Rockwell Collins is a supplier of electronic systems for commercial and military airplanes and would thus provide technology for this contract. On this front we expect the stock price of Tata Power to see some upward movement today.

Tech Mahindra announced its Q3FY13 results post market hours yesterday. Its net profit fell by 7% QoQ to Rs 275.8 crore. Income from operations increased nearly 10% to Rs 1791 crore. Overall, these numbers were better than expectations on every parameter for the company. Stock prices of Tech Mahindra are expected to see volatility through the day.

Among the major companies to announce their results today are Uflex, Talwalkar, ACC, Ambuja Cement, Apollo Hospital, Balaji Telefilms, Aurobindo Pharma, Bombay Dyeing, Ceat, GE Shipping, Hathway Cables, Hotel Leela Venture, JK Tyre, Jyothy Labs, MRF, MSP Steel, PC Jeweller, Prozone Capital, Tata Investment Capital and Orissa Minerals Development among others. We expect this cause movement in the stock prices of the above companies, with the direction dependent on the results they announce.