Indian equity benchmarks have made a gap-up opening on the back of strong set of numbers from IT bellwether Infosys. India’s second largest IT services exporter, reported a flat consolidated net profit for the third quarter ending December, 2012. The company posted a net profit of Rs 2,369 crore as compared to Rs 2,372 crore in the previous quarter ending September 2012. However, the local bourses, after surpassing their crucial 6,000 (Nifty) and 19,800 (Sensex) levels, pared their gains to trade slightly in the positive as traders remained cautious ahead of IIP numbers to be released later in the day. Some analysts are of the view that the industrial production for the month of November may contract by 1-1.5 per cent largely owing to post-Diwali base effect, after jumping 8.2 per cent in last month.
On the global front, the US markets added strength overnight mainly on the back of upbeat data from the overseas, there was mixed economic reports as the number of people filing for initial jobless claims rose while, the wholesale inventories rose 0.6% in November, which was higher than expected. Most of the Asian equity indices, after a positive start, entered into negative trajectory on the back of profit booking. However, the losses remain capped amid an improving outlook for global economies and reduced anxiety over the euro zone’s debt problems. Japanese benchmark Nikkei stock average was trading firm, gaining by over a percent as the yen accelerated its declines against the dollar and the euro.
Back home, software witnessed the maximum gain in trade followed by technology and consumer durables while, fast moving consumer goods, oil and gas down and realty remained the top losers on the BSE sectoral space. The broader indices were trading mixed while, the overall market breadth on the BSE was positive; there were 928 shares on the gaining side against 853 shares on the losing side while 73 shares remain unchanged.
The BSE Sensex opened at 19,813.64; about 150 points higher compared to its previous closing of 19,663.55, and has touched a high and a low of 19,839.80 and 19,754.86 respectively.
The index is currently trading at 19,760.13, up by 96.58 points or 0.49%. There were 10 stocks advancing against 20 declines on the index.
The overall market breadth has made a strong start with 50.05% stocks advancing against 46.01% declines. The broader indices were trading in-line with benchmarks; the BSE Mid cap was down by 0.19% and Small cap indices up by 0.02% respectively.
The top gaining sectoral indices on the BSE were, IT up by 7.19%, TECk up by 5.25%, Consumer Durables up by 1.03% and Metal up by 0.61% while, FMCG down by 1.16%, Oil & Gas down by 0.94% , Realty down by 0.58%, Bankex down by 0.54% and PSU down by 0.46% were the only losers on the index.
The top gainers on the Sensex were Infosys up by 12.87%, TCS up by 3.13%, Wipro up by 2.93%, Sterlite Industries up by 1.73% and Tata Steel up by 1.68%.
On the flip side, ONGC was down by 2.25%, ITC was down by 1.74%, Hindustan Unilever was down by 1.13%, Tata Power was down by 0.92% and ICICI Bank was down by 0.86% were the top losers on the Sensex.
Meanwhile, India's leading cellular players are expected to challenge a government demand for surcharges aggregating more than Rs 23,000 crore on their airwave holdings. The government traditionally sold airwaves bundle with permits at a low state-set price, but following a scandal over the grant process a recent auction of second-generation airwaves has resulted in newer carriers paying nearly seven times more.
After the cabinet approved the plan in November, telecom ministry has started issuing notices to telecom players including Bharti Airtel and Vodafone Group demanding to pay the surcharge. The government added that the surcharges for long-established telecom players are aimed at creating a balanced level between old and new operators. Whereas, as per the older operators, the move violates the conditions of their licence agreements with the government.
To be more precise, the government is expected to get Rs 4,251.83 crore from retrospective charges, Rs 18,925.82 crore from prospective charges. In all Rs 23,977.65 crore is expected from levy of one-time spectrum fee. Accordingly, state-owned BSNL will have to pay around Rs 6,912 crore, followed by Bharti Airtel - Rs 5,201 crore, Vodafone - Rs 3,599 crore, MTNL - Rs 3,205 crore, Idea Cellular - Rs 2,113 crore (includes Rs 231.5 crore of Spice), Aircel - Rs 1,365 crore (includes Rs 14 crore of Dishnet), Loop Mobile - Rs 606 crore and Reliance Communications - Rs 173 crore.
Further, for paying the surcharge, companies have the option to pay the money upfront or in annual installments with a 9.75 percent interest. Additionally, Reliance Communications, which is operating GSM and rival CDMA technology for mobile services, will have to separately pay surcharges for CDMA airwaves. Further, CDMA surcharges are yet to be finalized as the government is waiting for an auction in March.
Meanwhile, the Cellular Operators Association of India, which has most of the country's major carriers among its members, said ‘our lawyers will review those and then most probably we'll go to Telecom Disputes Settlement and Appellate Tribunal (TDSAT). Further, the surcharges are for companies operating on the GSM technology platform and are benchmarked to winning bid prices in the recent auction.
The S&P CNX Nifty opened at 6,012.40; about 43 points higher as compared to its previous closing of 5,968.65, and has touched a high and a low of 6,018.85 and 5,981.20 respectively. The index is currently trading at 5,982.15, up by 13.50 points or 0.23%. There were 13 stocks advancing against 37 declines on the index.
The top gainers of the Nifty were Infosys up by 12.87%, TCS up by 3.08%, Wipro up by 3.00%, Sesa Goa up by 1.40% and HCL Tech up by 1.26%.
On the flip side, ONGC down by 2.33%, ITC down by 1.85%, BPCL down by 1.71%, Grasim down by 1.66% and Ultra Tech Cement down by 1.24%, were the major losers on the index.
Most of the Asian equity indices were trading in the red; Shanghai Composite declined 10.87 points or 0.48% to 2,272.78, Hang Seng slipped 12.66 points or 0.05% to 23,341.65, KLSE Composite decreased 2.85 points or 0.17% to 1,687.08, Straits Times dipped 15.10 points or 0.47% to 3,211.15, KOSPI Composite tumbled 14.82 points or 0.74% to 1,991.98 and Taiwan Weighted was down 4.82 points or 0.06% to 7,806.82.
On the flip side, Jakarta Composite increased 3.10 points or 0.07% to 4,320.47 and Nikkei 225 was up by 120.56 points or 1.13% to 10,773.20.
