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Strong buying fuels Indian indices
Mon, 20 Jan Closing

Indian equity markets traded in the positive throughout the trading session today on the back of sustained buying activity across index heavyweights. Although some momentum was lost in the afternoon session, buying activity once again resumed in the later hours ensuring that the indices closed well above the dotted line. While the BSE-Sensex today closed higher by 141 points, the NSE-Nifty closed higher by 42 points. The BSE Mid Cap and the BSE Small Cap also did well and notched gains of 1% each. Gains were largely seen in IT and FMCG stocks.

As regards global markets, Asian indices closed mixed today while most European indices have opened in the red. The rupee was trading at Rs 61.60 to the dollar at the time of writing.

Cement stocks closed mixed today. While Ambuja Cement and UltraTech Cement found favour, Shree Cement and The Ramco Cements closed in the red. UltraTech Cement announced results for the third quarter and nine months ended December 2013. On a standalone basis, sales declined by 1.5% YoY during the quarter on account of flat volume sales and lower cement prices. Operating profits declined by 25.4% YoY as operating margins fell from 21.1% in 3QFY13 to 16% in 3QFY14. Other income decreased by 17.8% YoY during the quarter. Depreciation charges and interest expenses rose by 10.7% YoY and 73.6% YoY, respectively. On account of the poor performance at both the topline and operating profit level, net profits declined by 38.5% YoY during the quarter. Thus, net margins shrunk from 12.4% in 3QFY13 to 7.7% in 3QFY14.

Asian Paints also announced results for the third quarter and nine months ended December 2013. As reported by the company, on a consolidated basis, income from operations rose by 14.3% YoY. While profit before tax (PBT) increased by 9.6% YoY, net profit growth stood at 8% YoY. As far as the business segments are concerned, the decorative paints business in India did well despite the challenging and uncertain macro environment. But the industrial segment faced some pressure on account of the prolonged sluggishness in the manufacturing sector in the country and lack of significant capex activity. With respect to its international operations, Middle East and Asia did well although some countries bore the brunt of political events and macro economic uncertainty. The stock closed marginally lower today.

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