Markets end truncated week up 0.5%

Wed, 4 Apr Closing

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The Indian stock markets had a lackluster outing on the bourses today, ahead of the long weekend. After opening below the dotted line, markets remained in negative territory for the whole of today's trading session. While the BSE-Sensex closed lower by around 111 points (down 0.6%), the NSE-Nifty closed lower by around 36 points (down 0.7%). The BSE Mid Cap and BSE Small Cap, fared slightly better. While the midcap index closed flat, the smallcap indices closed higher by 0.4%. Power stocks and consumer durables led the gains. Realty and metal stocks indices were however trading weaker.

As regards global markets, major Asian indices had a mixed outing today. European indices opened the day on a negative note. The rupee was trading at Rs 51.16 to the dollar at the time of writing.

IVRCL has been one of the top movers in the BSE-Smallcap index over the past 3 months, rising more than 150% since December 2011. Subhash Chandra promoted, Essel Group has hiked its stake in IVRCL to 12.27% by purchasing an additional 2.08% stake from open market. Two Essel Group entities - Asian Satellite Broadcast Private and Jay Properties Private have acquired 5.6 m shares of the construction company. Just last week, the Essel Group announced that it had acquired 10.2% stake in IVRCL through open market purchases. Now, with the latest round of acquisition the Essel Group now owns more stake than IVRCL's promoters. As per the December 2011 shareholding data, IVRCL promoters, led by founder E Sudhir Reddy, have 11.18% stake in the company. Thus, the control of the company could be soon wrestled away from the promoters. The stock was trading over 2.7% higher in today's trade.

Bharat Heavy Electricals Ltd (BHEL) recorded a turnover of Rs 493 bn during the FY12 fiscal, seeing a 13.8% increase over the previous year, according to a provisional statement. The earnings per share (EPS) during FY12 stood at Rs 28.1, indicating a 14.2% increase over the previous year. However, the company's order book fell to Rs 221 bn from Rs 600 billion in 2010-11, on account of sluggishness in the power sector. However, the company expects flat growth in sales in FY13 on account of various uncertainties the power producers are facing. Shortages of fuel supplies, delays in environmental clearances for power and mining projects and drying up liquidity has severely damaged the power sector. BHEL expects gross sales of Rs 500 bn in FY13, which is pretty much flat compared the previous year.

The company has however decided to put its divestment plan on hold. It has withdrawn the draft red herring prospectus (DHRP) for a follow-on public offering (FPO). This was for the disinvestment of the government's 5% stake in the company. BHEL was the top mover among the Sensex stocks, rising over 3.5% in trade today, despite a weak overall market. Power stocks were however the top gainers in an overall weak market.