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Markets will remain closed on 19th & 20th October 2017.
We wish all our readers a very Happy Diwali!

Realty and Metal Stocks Bear the Brunt
Tue, 8 Dec Closing

After trading in the negative territory for most of the trading session, the Indian stock markets closed the day deep in the red for a fifth consecutive daily loss amid weak international cues. While the BSE-Sensex today closed lower by 220 points, the NSE-Nifty closed lower by 64 points. Midcaps and Small caps too closed the day in the red. While the S&P BSE Midcap index closed lower by 1.2%, the S&P BSE Smallcap index closed lower by 1.3%. Realty and metal stocks were the biggest losers today.

Asian stock markets finished sharply lower today with shares in China leading the region. The Shanghai Composite is down 1.89%, while Hong Kong's Hang Seng is down 1.34% and Japan's Nikkei 225 is lower by 1.04%. European markets are lower today with shares in London down the most. The FTSE 100 is down 0.55%, while Germany's DAX is down 0.49% and France's CAC 40 is lower by 0.36%. The rupee was trading weak at 66.80 against the US$ in the afternoon session.

L&T Construction, a subsidiary of L&T, has reportedly bagged orders worth Rs 19.6 billion across its various businesses. Under water & effluent treatment business, the company has secured orders worth Rs 10.53 billion from the Water Resource Department, Government of Odisha, for the engineering, procurement and construction of 34 lift irrigation schemes in various districts of Odisha. Under heavy civil infrastructure business, the company has secured orders worth Rs 8.89 billion. The company has received an order from Chennai Metro Rail Corporation for the construction of Chennai Metro line Package 03 Underground Balance works.

Also, L&T Geostructure-Bauer Joint Venture has secured an order worth Rs 4.22 billion for the construction of a cutoff wall in the Indira Sagar dam project at Polavaram, Andhra Pradesh, a first of its kind project in India. L&T Geostructure's share in the JV is 50%.

The stock price of L&T fell 20% in the last 3 months. The management has indicated that it may still take some time for a significant pick-up in business to materialise. The investment momentum in the domestic market is yet to gather pace. Excess capacity continues to restrain industrial capital expenditure and private sector investment. Middle East capex too is witnessing a slowdown due to the fall in oil prices. In our recent edition of 'The 5 Minute WrapUp Premium', we have discussed the performance of various sectors of L&T (Subscription Required) and what the future holds for the company and the engineering sector.

According to a leading financial daily, Coal India is planning to invest Rs 570 billion by 2020 in a bid to more than double its annual production to 1 billion tonnes. The company produced 494 million tonnes of coal in 2014-15.

According to reports, Coal India will invest about Rs 60 billion in 2015-16 and Rs 82.82 billion in 2016-17. During 2017-18 and 2018-19, investments are slated to jump to Rs 145.39 billion and Rs 146.35 billion, respectively. In 2019-20, the company will invest Rs 135.29 billion.

Reportedly, Coal India's cash reserves currently stand at Rs 500 billion and the company is expected to generate around Rs 100 billion to Rs 150 billion for the next 5 years. The cash reserve is an encouraging sign for the company because large global institutions have either stopped financing coal projects or are in the process of reducing their exposure in the sector.

India's energy demand has doubled since 2000. But the country still has about 240 million people, one fifth of the population, without access to electricity. By 2040, the country's per capita energy demand will still be 40% lower than the world average. But it will have to provide for nearly 600 million new electricity consumers. Investment in domestic mining and production of coal is expected to make India the largest source of global coal. Coal India is the most cash-rich listed company in India with negligible debt on its books. The cash on its books is two and four times that of IT heavyweights Infosys and TCS respectively. Its dividend yield continues to be appealing (Subscription Required).

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Oct 19, 2017 (Close)

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