Index Trends & Stocks In Action For 21st May 2013

The markets ended lower on Monday, ending their four day winning streak due to profit booking witnessed in Pharma shares on worries that the new price control regime will sharply reduce drug prices thereby impacting growth and profitability. The Nifty ended at 6157, down by 30 points. The Index has formed bearish engulfing pattern, which is a trend reversal pattern. Going forward 6120 will act as a strong support level and if the Nifty breaks this level it can see levels of 6090 on the lower side. On the other hand resistance for the Index will come in around 6200 levels.

Mahindra Lifespaces is nearing the threshold for FII holdings in the company. According to a company release, as of May 17, 2013, the holdings of FIIs in the company reached 28.25% of the paid-up equity capital. The RBI has allowed FIIs to purchase up to 30% of the paid up capital of Mahindra Lifespaces, under the portfolio investment scheme through primary markets and stock exchanges. Stock prices of Mahindra Lifespaces are likely to see some upward movement today.

Arvind announced its Q4FY13 numbers post market hours yesterday. In Q4FY13, the company reported a growth in revenues of 10.02% to Rs 1406.11 crore, as compared to Q4FY12. Its operating profit grew by 53.24% to Rs 138.24 crore and its net profit by 13.66% to Rs 75.79 crore. Stock prices of Arvind are likely to see upward movement today.

Vedanta group company, Cairn India has said that it holds 2.19 billion barrels of oil reserves as at the end of FY13 in the prolific Rajasthan oil blocks. Mangala, Bhagyam and Aishwariya, the three oil fields in the Rajasthan block held 2.090 billion barrels of oil and gas reserves by the end of FY12 and after one year, Cairn has increased the estimated reserves indicating that the oil block has more potential than estimated. The company has also found oil in the first well that it drilled during the last quarter. Overall these developments are expected to have a positive impact on the scrip.

Hotel Leelaventure reported a net loss of Rs 142.17 crore for the fourth quarter ended March 31, 2013 mainly on account of finance costs. It had posted a net profit of Rs 209.66 crore for the corresponding quarter last fiscal. Net sales, however, rose to Rs 200.63 crore for the quarter under consideration from Rs 139.31 crore for the same period year ago. The company has a total debt of Rs 4602 crore as on March 2013 mainly on account of capital expenditure incurred to set up the Udaipur, Delhi and Chennai hotels, apart from acquiring plots at Agra, Pune and Bangalore, next to the Leela Palace. These developments will not go unnoticed and the stock is likely to react.

Srei Infrastructure Finance posted a 430 per cent rise in net profit to Rs 69 crore for the quarter ended March 31, 2013. Profits stood at Rs 13 crore during the same period last year. Income from operations grew by 19 per cent to Rs 780 crore. The numbers look impressive at least on the face of it and will help the stock in trades today.

The Oil Ministry has moved a Cabinet note to raise the price of natural gas produced by state-owned ONGC and OIL as well as private firms like Reliance Industries to USD 6.7, less than USD 8-8.5 hike previously expected. Oil & Gas counters are likely to remain in action today following this development.

State-owned Indian Oil Corp yesterday announced that it has developed and commercialized a technology which will use non-edible oil extracted from plants like Jatropha in auto fuels. This is first time such a technology is developed by an Indian company. The announcement is likely to be seen as a big positive by the market.