NHB Has Entered Into The Retail Market - Jan 16, 2009

National Housing Bank (NHB) has entered into the retail market for deposits with the launch of two schemes - NHB Sunidhi term deposit scheme and NHB Suvriddhi (tax saving) term deposit scheme. In addition, NHB has launched Sumeru zero-coupon bonds, which will be sold at a discount at Rs 4,360 with a face value of Rs 10,000 that the holder will get after a maturity period of 10 years.

Under the NHB Sunidhi term-deposit scheme, the investors will get 9.25 per cent interest for 12 months and 9 per cent interest for up to five years while the interest rate on Suvridhi is 8.75 per cent compounded quarterly. However, under the Suvriddhi scheme, the deposits made by resident individuals and HUFs would get Section 80C benefit. The minimum deposit under the scheme is Rs 10,000 and thereafter in multiples of Rs 10,000 with maximum of Rs 1,00,000. The deposit under this scheme will have lock-in period of 60 months.

Equities Likely To Extend Global Rally; 5000 On Nifty Eyed

MUMBAI: Equities are seen sharply higher on Wednesday, pacing gains in global markets, following US Fed Chairman Ben Bernanke's $200 billion lifeline in a coordinated effort with other central banks to strained credit markets.

Investors cheered the move by central banks driving major US indices over 3 per cent. The Dow Jones Industrial Average soared 416.66 points, or 3.55 per cent, to 12,156.81, the Standard & Poor's 500 Index climbed 47.28 points, or 3.71 per cent, to 1,320.65 in its biggest daily percentage gain since October 2002. The Nasdaq Composite Index gained 86.42 points, or 3.98 per cent, to 2,255.76.

Equities across Asia joined the global party with Japan's Nikkei up 2.7 per cent, Hang Seng rising 2.65 per cent and Singapore's Straits Times climbing 2.73 per cent.

Back home, on Tuesday, the National Stock Exchange's Nifty ended higher by 66 points or 1.36 per cent at 4865.90. From the low of 4732.85, the index rose to a high of 4888.50 ahead of the close.

The Bombay Stock Exchange's Sensex finished 199 points or 1.25 per cent higher at 16,123.15, near its intra day high of 16,168.13. The low was 15,739.04.

However, provisional data on NSE suggests foreign institutional investors were net sellers of equity worth Rs 539.24 crore. On the other hand, mutual funds net bought equity worth Rs 303.36 crore.

"5000 remains an important barrier for the Nifty. Once it crosses that level aggressive fresh buying could be expected," said Hitesh Sheth, head of technical research at Prabhudas Lilladher.

Market Pares Its Early Gains

The market pares its early gains as the investors are taking calculated steps in booking their positions. The market got a boost early session led by the finance minister''s statement on Tuesday that the recent fall in the stock market was not due to the FIIs but the fall could be attributed to subprime crisis in line with expected recession in US and firming up of oil prices.

The market will remain closed from 11:45 IST to 12:25 IST due to sun outage. Trading time has been extended till 16:15 IST. The changes in timings will be applicable from today to 18 March 2008.

At 11.34AM, BSE Sensex is trading lower by 20 points at 16,320 and NSE Nifty is trading marginally up by 0.55 points at 4,864.80

Leading the rally from he gainers pack are Nestle India trading up by (3%) at Rs1475.05 in line with Satyam by (2.64%) at Rs471.30, Dr Reddy''s lab by (2.56%) at Rs571.90, BPCL by (2.39%) at Rs447, Tata Chemicals by (2.35%) at Rs326.50, Infosys by (2.33%) at Rs1453.

The Oil and Gas is trading higher by 71.66 points at 10,237.78. Pushing it are BPCL is trading up by (2.82%) at Rs448.85 in line with ONGC by (2.3%) at Rs979.15, IOCL by (1.21%) at Rs531.50, HPCL by (0.60%) at Rs286.10, Aban Offshore by (0.37%) at Rs3750.10.

The IT index is trading up by 70.82 points at 3,685.23 as Satyam is trading higher by (2.64%) at Rs471.30 in line with Infosys by (2.6%) at Rs1454.90, Aptech by (2.50%) at Rs219, HCL Tech by (2.01%) at Rs273.50, Tech Mahindra by (1.57%) at Rs672.75.

Infosys is trading up by (2.60)% at Rs1454.90 as the company is looking for opportunities for acquisitions in the markets of Europe and Japan within a price band of $200-$300mn to energise its non-linear business strategy. It is targeting companies engaged in consulting, BPO.ONGC is trading higher by (2.3%) at Rs979.15 as the government has approved the compnay''s subsidiary ONGC Videsh''s investment of $102.21 mn in a Qatar based project and also its formation of a joint venture with CVP/ petroleos De Venezuela SA.

Market Pares Its Early Gains

The market pares its early gains as the investors are taking calculated steps in booking their positions. The market got a boost early session led by the finance minister''s statement on Tuesday that the recent fall in the stock market was not due to the FIIs but the fall could be attributed to subprime crisis in line with expected recession in US and firming up of oil prices.

The market will remain closed from 11:45 IST to 12:25 IST due to sun outage. Trading time has been extended till 16:15 IST. The changes in timings will be applicable from today to 18 March 2008.

At 11.34AM, BSE Sensex is trading lower by 20 points at 16,320 and NSE Nifty is trading marginally up by 0.55 points at 4,864.80

Leading the rally from he gainers pack are Nestle India trading up by (3%) at Rs1475.05 in line with Satyam by (2.64%) at Rs471.30, Dr Reddy''s lab by (2.56%) at Rs571.90, BPCL by (2.39%) at Rs447, Tata Chemicals by (2.35%) at Rs326.50, Infosys by (2.33%) at Rs1453.

The Oil and Gas is trading higher by 71.66 points at 10,237.78. Pushing it are BPCL is trading up by (2.82%) at Rs448.85 in line with ONGC by (2.3%) at Rs979.15, IOCL by (1.21%) at Rs531.50, HPCL by (0.60%) at Rs286.10, Aban Offshore by (0.37%) at Rs3750.10.

The IT index is trading up by 70.82 points at 3,685.23 as Satyam is trading higher by (2.64%) at Rs471.30 in line with Infosys by (2.6%) at Rs1454.90, Aptech by (2.50%) at Rs219, HCL Tech by (2.01%) at Rs273.50, Tech Mahindra by (1.57%) at Rs672.75.

Infosys is trading up by (2.60)% at Rs1454.90 as the company is looking for opportunities for acquisitions in the markets of Europe and Japan within a price band of $200-$300mn to energise its non-linear business strategy. It is targeting companies engaged in consulting, BPO.ONGC is trading higher by (2.3%) at Rs979.15 as the government has approved the compnay''s subsidiary ONGC Videsh''s investment of $102.21 mn in a Qatar based project and also its formation of a joint venture with CVP/ petroleos De Venezuela SA.

Realty Rally Seen Losing Steam, Stocks Slide 28%

MUMBAI: The bearish stock market has dealt a major blow to investors in shares of realty companies, causing a major capital loss to them in the past few weeks. The market sentiment towards the sector is likely to worsen with the withdrawal of high-profile Emaar MGF IPO on Friday, fear brokers.

From its high of 13,647 on January 14 ‘08, the BSE Realty index has crashed 28% to close at 9,784 on Friday. The fall has been sharper than that in the Sensex which was down 16% during the period. Some realty stocks have taken so much beating that they are now quoting at a substantial discount to their respective public offer prices.

Analysts say the hype surrounding realty stocks has been on the wane as investors fear that weak stock market will depress sentiments in the realty market and put pressure on the property prices.

“Investors had taken fancy for realty stocks in anticipation that property prices will continue to move upward. The ground realty, however, is that property prices have been softening, which market kept ignoring during the bull run. The realty stocks are expected to lose 18-20% more and so investors are advised to exit investments at every bounce back in the share prices,” said Karvy Stock Broking vice-president Ambareesh Baliga.

While almost all the listed realty stocks have lost ground, some of them have, in fact, crashed below their respective offer prices, raising concerns about their valuations. For instance, shares of Omaxe closed at Rs 269 on Friday, lower than the offer price of Rs 310.

The stock has crashed 48% since January 14, ‘08. Parsvnath Developers and Puravankara Projects are two other new listings which are quoting at a substantial discount to the offer prices. The stocks have fallen 42% and 25% in the past three weeks.

“The market reaction is sentimental. What we are facing now is a global phenomenon. I feel this is a temporary phase. The realty stocks would come back after some time and this will help the real estate market to get mature as well,” DTZ director (investments) Amber Maheshwari, an international property consultant. The ongoing bearish trend in the secondary market has taken its toll on the primary market. A few major IPOs like Wockhardt Hospitals and Emaar MGF Land are withdrawn on account of poor investor response.

Indices Subdued As Investors Turn Cautious

MUMBAI: Trade turned choppy as wary investors chose to stay away from the market. Realty and metal shares remained weak but information technology counters provided the much needed support.

The positive close on Wall Street, and with most Asian markets closed for the Chinese New Year, there is no additional pressure on the equities, at least from global shores.

“Volatility can be the order of the day; an intra-day upside could come in below the 5,113 level while significant support at lower levels (5005) – would limit the downside. The outlook has turned neutral again while resistance comes in at the 5550+ level and support comes in at 4,820,” said Asit C. Mehta in a note.

At 11:29 am, Bombay Stock Exchange’s Sensex was at 17,507.55, down 0.11 per cent or 19.38 points, slipping from a high of 17,688.73 in trade so far. The low was 17,373.69.

National Stock Exchange’s Nifty was down 0.43 per cent or 21.85 points at 5111.40. The index swung between a range of 5173.85 and 5078.25 so far.

Secondline shares took a sharp knock. BSE Midcap and Smallcap Index were down 1.79 per cent and 2.27 per cent, respectively.

Declines in DLF (down 4.24 %), L&T (3.04%), Bajaj Auto (2.47%), Tata Steel (1.86%), HDFC (1.54%), ICICI Bank (1.47%) kept the indices subdued.

Biggest large cap gainers were Infosys (up 4.47%), TCS (3.31%), Satyam Computers (3.26%), Wipro (1.79%), Ranbaxy (1.43%) and Hindustan Unilever (1.08%).

Market breadth on BSE showed 2,005 declines against 433 advances.

SEBI For 25% Price Band On IPOs Up To Rs 250 cr

MUMBAI: Stock market regulator SEBI has proposed a 25% first-day price band for IPOs up to Rs 250 crore, to enable “steady and sustained price discovery over a period of time”.

Once enforced, a price-band will put off several punters and leveraged investors who borrow money to pocket the listing premium by selling the shares soon after trading begins, a practice that’s known as ‘first day first show’ in Dalal Street.

Some forthcoming IPOs raising less than Rs 250 cr
The move has evoked a mixed response. “Why single out the smaller players... abnormal price movements have been witnessed in larger issues as well in the past,” said Prime Database MD Prithvi Haldea. “What needs to be addressed first, is the price discovery mechanism in IPOs.

Second it is imperative that the free float is increased,” he adds. “If 75-85% of the market cap is effectively in large companies, why penalise small companies. What of the significant rise in DLF post its listing?” said an investment banker. SEBI has invited public comments on the imposition of circuit filters on the first day of listing of shares.

At present, stock exchanges do not impose price bands on the day of listing of IPOs. The price fixed by the company , in consultation with its lead managers, is left open to price discovery. And, after the day of listing, there is a regular price band of 20%. This, however, would not apply to stocks which get relisted.

For IPO issue sizes that are greater than Rs 500 crore, price bands are not imposed even after the day of listing, if such scrips are available for trading on the derivative segment. It may be recalled that the SEBI chairman had suggested a price band in April 2007 on the grounds that it would check any irregular movements in stocks.

In the same month SEBI had banned seven brokerages from debut trading in newly-listed shares for their alleged role in huge price movements recorded in stocks like Cambridge Technology, Mindtree and Pyramid Saimira Theatre on their first day of trading. Some of these stocks witnessed unprecedented jump in their share prices immediately after the listing.

In a note on Thursday, SEBI said it has been noticed that there are significant price and volume spikes/volatility on the day of listing of IPOs. This was particularly true of IPOs which were below Rs 250 crore.

For several such IPOs where the stock is available for trading in the hands of public, after excluding shares of promoters and others that face a lock in period, is 25-30% of the equity capital of the company, the price may not sustain on subsequent days. This may disappoint long-term investors, said SEBI.