Buying activity led the Indian market to rise further in the green during the previous two hours of trade. Currently, stocks from across the sectors are trading firm led by those from the oil & gas, and banking spaces. However, realty stocks are the sole loser as the BSE-Realty index is trading lower by 0.4%.
The BSE-Sensex is trading higher by 180 points (up 1.1%), while NSE-Nifty is trading higher by 50 points (up 1.1%). The BSE-Midcap index is trading higher by 0.4%, while the BSE-Smallcap index is up by 0.3%. The rupee is trading at 46.64 to the US dollar.
Stocks of telecom companies are trading firm today. The key gainers include Idea Cellular, Reliance Communications, MTNL, Tata Teleservices (Maharashtra) and Bharti Airtel. Gains in these stocks are on the back of the completion of the 3G auction process. With the price of 3G spectrum touching levels of Rs 168 bn for a pan-India license, there was a good amount of concern amidst the investing community. This is especially when compared to the reserve price of Rs 35 bn (for a pan-India license). However, none of the telecom operators have bid for spectrum in all circles, thereby reducing the overall concerns to a certain extent. However, the fact that the telecom operators need to take on good amount of debt on their books does remain a concern. The stocks of companies such as Idea Cellular and Reliance Communications are possibly trading higher than that of Bharti's as they will be shelling out less than 50% and 30% respectively as to what Bharti will be spending. At this point, it would be too soon to say whether this is a positive or a negative for companies considering that their approaches and strategies to this auction would have been different. However, it will be interesting to see who will be the most successful in terms of the service launch going forward.
India's largest adhesive manufacturer Pidilite announced its 4QFY10 and FY10 results yesterday. The company's top line for the year grew by 9.3% YoY. This growth was aided by strong performance by the company's consumer & bazaar products and industrial products segments. Pidilite's operating margins expanded by 6.5% as a result of fall in raw material and lower other expenditure as a percentage of sales. Bottom line of the company doubled during the year. This was on the back of strong growth in operating income and higher other income recorded during the year. However, when adjusted for foreign exchange losses, net profit grew by 86% YoY during FY10. For 4QFY10 the company's sales grew by 17% while the net profit fell by 19% YoY. This is due to foreign exchange gain recorded in 4QFY09. When adjusted for foreign exchange income, net profit for the quarter grew by 62% YoY.