Index Trends And Stocks In Action 8th February 2013

The Indian markets on Thursday closed lower as the government disappointed the street by sharply reducing the GDP forecast to 5% VS 6.2% (YoY) lowest in a decade. The reasons attributed to this low estimate were the poor performance of manufacturing, agriculture and service sectors. This had the Nifty closing lower by 0.34% at 5939 and hitting a one-month low.  However the Nifty sustained above its 50-day EMA (5934). On Friday the Nifty is likely to seek support around 5900-5880 and face resistance around levels of 5990-6020.

MRF announced its Q3FY13 results post market hours yesterday. The company posted an increase in revenues of 5.23% to Rs 3025.75 crore. At the same time, it saw a larger boost in profits. This was aided by a near 15% easing in rubber prices over last year and due to increased efficiency. The net profit for MRF grew by 59.7% to Rs 180.3 crore in the quarter under review. This is likely to result in a jump in the stock price of MRF today.

Bharti Airtel, in an attempt to build a more connected organisation, took on major operation restructuring and split its business into 8 segments. Operations would be divided into 8 hubs from the current 3 hubs and changes will be effective from March 1, 2013. Bharti Airtel is looking at improving profitability while increasing both 3G and 4G subscriber base. This is likely to result in volatility in the stock prices of Bharti Airtel today.

Power Grid Corporation said that it would be raising close to Rs 3000 crore to fund its expansion plans in this fiscal. Although this money would be raised through a bond issue, the company is reported to have been contemplating between a rupee or a dollar bond issue. Meanwhile, to avoid the pressure on Power Grid Corporation, as it is the sole central transmission unit, the Power Ministry is formulating new regulation. The Central Electricity Regulatory Commission (CERC) is said to be firming up the proposal. This is likely to cause volatility in the stock prices of Power Grid Corporation today.

Among the companies that are expected announce their  Q3FY13 results today are Bharat forge, Birla Corp, BPL, Canara Bank, Cox & kings, Emami, GMR Infra, Hindalco Industries, Mahindra & Mahindra, Max India, Ruby Mills, SunPharma, Tata Chemicals and Titan Trading, among others. Stocks of these companies are expected to remain volatile ahead of the announcement and direction firming up post announcement.