India Insight

Sensex performers in 2013: TCS surges 73 percent, Sun Pharma gains 54 percent

By Aditya Karla and Sankalp Phartiyal

The BSE Sensex ended 2013 with gains of 9 percent after hitting life highs during the year. The benchmark index touched an all-time high of 21,483.74 on Dec. 9 after falling to a 2013 low of 17,448.71 in August.

Foreign inflows boosted sentiment on the street even as concerns about a slowing economy and high inflation weighed. Foreign institutional investors (FIIs) bought a net $20.1 billion worth of Indian shares in the year. FIIs had bought $24.5 billion worth of stocks in 2012.

The sharp fall in the rupee and recovering U.S and European economies boosted export-driven sectors, helping shares in many IT and pharma companies rank among the top Sensex performers.

India’s three IT majors — TCS, Infosys and Wipro — were among the best Sensex performers of 2013 while SBI, BHEL and Coal India were the top losers.

Here is a list of gainers and losers of 2013:

GAINERS

TATA CONSULTANCY SERVICES (TCS): Shares of India’s top software services provider ended 2013 with smart gains. The stock surged almost 73 percent this year, outperforming the BSE IT index which gained 60 percent. Weakness in the rupee – which touched life lows and fell to nearly 70 before recovering — and an improving demand scenario aided sentiment.

Markets this week: Sensex gains 3 percent, Tata Motors surges 10 percent

The BSE Sensex rose 3 percent during the week, ending in the green for four of the five trading sessions. Improved guidance from Infosys, hopes of a U.S. deal to avoid a default on its debt and the RBI’s decision to cut a key overnight interest rate helped sentiment.

Data released on Thursday showed India’s trade deficit narrowed to a two-and-a-half-year low in September, raising hopes for a significant reduction in the country’s current account deficit.

The rupee ended at 61.07/08 per dollar, helped by good dollar sales by corporates and as emerging currencies rose with risk sentiment improving.

Markets this week: Sensex gains 2.7 percent, Maruti surges 11 percent

By Ankush Arora and Sankalp Phartiyal

The BSE Sensex rose 2.7 percent in the week ending September 20, as foreign inflows and the U.S. Federal Reserve’s surprise decision to continue with its bond-buying programme boosted market sentiment.

The benchmark index, which is now up 9 percent in September and has gained for four consecutive weeks, touched its highest level since November 2010 on Thursday after the Fed’s surprising move. Analysts said the U.S. central bank’s decision could lead to a resurgence of portfolio flows into emerging markets such as India.

On Friday, the Reserve Bank of India stunned markets by raising the repo rate by 25 basis points (bps), but some of the recent rupee support measures were trimmed. The Indian currency gained 2 percent in the last five sessions and ended the week at 62.23/24 per dollar.

Markets this week: Sensex gains 2.4 percent; L&T, Tata Power surge

September is turning out to be a good month for Indian shares, as key stock indexes extended gains in the last four sessions. Monday was a market holiday.

The BSE Sensex gained 2.4 percent, while the broader Nifty rose nearly 3 percent as foreign institutional investors (FIIs) extended buying into Indian equities. A recovery in the rupee, which posted its best week in 15 months, also boosted sentiment.

Profit-taking dented markets mid-week as caution also prevailed ahead of a series of macroeconomic events scheduled next week, including August inflation data due on Monday and the likelihood of U.S. Fed’s decision to announce a reduction in its monetary policy stimulus. RBI will review its policy on September 20.

Outlook weak for India economic growth: analysts

India’s economy grew at 4.4 percent in the June quarter, its slowest rate since the first three months of 2009 and weaker than analysts’ consensus of 4.7 percent in a Reuters poll.

With the rupee still trading near record lows and a ballooning current account deficit alarming investors and policymakers, several investment banks are worried about the road ahead.

Here are some comments on India’s economic growth released by investment banks after the recent GDP data:

Pricey dollar puts South Africa, Australia on Indian tourists’ maps

When Aparupa Ganguly visited South Africa in 2007, the country’s topography and wildlife made such an impression on the communications professional that she couldn’t wait to come back. Ganguly got her wish six years later – thanks to a stable rand.

Foreign-bound Indian travellers such as Ganguly are realizing that holidaying in countries such as South Africa and Australia offers value for money as their currencies have been largely stable in recent weeks and haven’t appreciated as much against the rupee, when compared to the dollar or the euro.

Data shows the South African rand and the Australian dollar have gained around 10 percent since May, compared to a near 30 percent surge in the U.S. dollar which hit a record high above 68 per rupee on Wednesday.

Bharti Airtel, NTPC top Sensex losers this week

By Sankalp Phartiyal and Ankush Arora

The BSE Sensex recovered on Thursday and Friday after the index lost around 700 points in the first three trading sessions of the week. However, the index still ended down 0.4 percent as a weak rupee, concerns over foreign flows and uncertainty over the end of the U.S. Fed’s stimulus plan kept investors on the edge.

As a worsening current account deficit and inflation loomed large, the rupee hit fresh record lows below 65 per dollar in the week ending Aug. 23. However, gold prices and bonds rallied.

Fitch Ratings has warned Asia’s third-largest economy of a downgrade if the government fails to soothe tensions in the financial market. JP Morgan and HSBC downgraded Indian shares to ‘neutral’.

India’s TV import duty taxes travellers… and grey markets

India on Monday imposed a 36 percent duty on flat-screen televisions that travellers bring back from other countries, seen as another step to support a falling rupee. The move, however, will do little to help the economy but will cheer television manufacturers in India and hit grey markets, experts said.

India has taken various measures in recent months to deter the import of commodities such as gold as Asia’s third-largest economy tries to tamp down its current account deficit and a weak rupee that touched record lows below 65 per dollar this week.

The duty will not have significant effect on the rupee or on the current account deficit, which is estimated at 3.7 percent of the gross domestic product this year. With only seven months’ worth of foreign exchange reserves, India is taking a number of measures to narrow the gap between its imports and exports, though trying to discourage television purchases in foreign currency might not do much more than set an example.

Markets this week: BHEL is top Sensex loser

By Ankush Arora and Sankalp Phartiyal

The BSE Sensex had been headed for a week of gains until upbeat U.S. jobs data triggered fears of a soon-to-start tapering of the Fed’s monetary stimulus, pulling the benchmark down by a percent for the week ending Aug. 16. The broader Nifty slumped 4 percent on Friday, marking its biggest daily drop in almost two years.

The rupee also fell to a new record low of 62.03 versus the dollar on Friday despite the Reserve Bank of India (RBI) and the government’s continued efforts to prop up the currency.
New measures by the RBI to restrict how much Indian citizens and companies can invest abroad raised fears of outright capital controls that could spook foreign investors, hurting the rupee further.

The outlook remains bleak as Indian shares marked their fourth consecutive weekly fall, totalling a decline of 7.7 percent.

Tracking Sensex: L&T top loser this week

By Aditya Kalra and Sankalp Phartiyal

The Sensex lost 2 percent and the Nifty slipped 2.3 percent in a tough week for stocks as Indian markets remained cautious ahead of the Reserve Bank of India (RBI) policy review on July 30.

The benchmark Sensex, which ended in the red for three of five trading sessions, touched a 2-1/2 year high during the week as consumer goods shares surged.

The rupee continues to be in focus as it hit a five-week high on Friday. The RBI tightened liquidity further on Tuesday to support the rupee and the central bank is likely to hold rates at its policy review next week.

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