Money on the markets

Mutual fund investors rewarded for patience

Equity fund investors had a lot to cheer about in the last seven months.

Stock market enthusiasts had almost given up hope after losing an average 52 percent in 2008, when the benchmark Sensex recorded its first annual fall after six years of gains. But a rally since the start of March has bought the smiles back.

By September 30, as many as 10 equity funds more than doubled their net asset values as fund managers bought into the global panic, data from global fund tracker Lipper, a Thomson Reuters company, showed. During the same period 145 Indian equity funds outperformed the 30-share Sensex, which returned 73 percent.

Domestic tax saving funds, which manage nearly 200 billion rupees ($4.3 billion dollars), also rose with the tide. The nation’s largest such fund, SBI Magnum Tax Gain, surged 83 percent.

Tax funds provide investors with an avenue to save up to 33,000 rupees in Income Tax, although the invested amount remains locked in for a period of three years.

SBI’s smaller rival, Birla Sun Life Tax Relief 96, was a step ahead. The fund, which manages 10.3 billion rupees, leapt 90 percent in the nine months to September.

M&M stock rises in weak market

Shares in Mahindra & Mahindra rose nearly 4 percent to 928 rupees and ended as the top Sensex gainer, even as the benchmark index dropped over 200 points.

The company reported its quarterly numbers on Wednesday and said net profit nearly trebled, helped by cost cuts and strong sales.

Its shares, which ended as the top gainer in the BSE Auto index, touched an intra-day high of 942 rupees before closing at 928 rupees.

The stock has returned a tad over 5 percent this month, better than the 6.2 percent drop in the auto index.

Would you invest in this stock after evaluating its results?

Banking index drops after RBI move

The BSE banking index slid more than 1.8 percent on concerns bank profits would be hit after the RBI raised the provision ratio for bad debts on Tuesday.

The RBI on Tuesday asked banks to increase the minimum provision ratio for bad debts to 70 percent from 10 percent by September 2010.

Top private lender ICICI Bank, which has over 7 percent weightage in the 30-share sensitive index, slipped 3.1 percent to 810 rupees.

Shares in State Bank of India (SBI), which had their biggest fall in 10 weeks on Tuesday, gained 0.69 percent in today’s trade to 2218 rupees.

The BSE Realty Index ended 1.5 pct down, with the main losers being HDFC Bank (down 3.1 percent), Canara Bank (down 2.2 percent), Karnataka Bank (down 2.26 percent) and Axis Bank (down 2.4 percent).

Do you think banking stocks will fall further on RBI’s move?

Realty index dives

The BSE Realty Index slid nearly 8 percent to a two-month low on Tuesday after the Reserve Bank of India (RBI) withdraws some liquidity measures.

The BSE Realty Index ended 6.2 pct down, with the main losers being Puravankara (down 9.9 percent), Omaxe (down 9.6 percent), HDIL (down 8.6 percent) and Unitech (down 7.6 percent).

“The sector is just recovering and this will definitely affect developers,” Sarang Wadhawan, managing director, Housing Development & Infra, said.

The RBI, in its quarterly policy review on Tuesday, increased provisioning for commercial real estate loans to 1 percent from 0.4 percent for standard assets, and also raised the statutory liquidity ratio by 1 percent.

The realty index has gained over 70 percent so far this year.

Do you think realty stocks will fall further on the RBI’s move?

RBI Policy Review

Reuters India brings to you breaking news on the Reserve Bank of India’s quarterly policy review.

Punj Lloyd dives

Shares in Punj Lloyd shed over 16 percent on Monday after the engineering and construction firm reported September quarter net profit fell 63 percent to 0.53 billion rupees from 1.44 billion in the same period a year ago. The stock ended 16.47 percent down at 217 rupees in a broader market which closed 0.4 percent lower.

It was among the top traded stocks on the BSE with volumes of over 6 million, its highest since May 21, 2009.

The counter has gained over 50 percent so far this year.

Do you think the counter is an attractive buy?

FMCG stocks outperform market

The BSE FMCG index gained over 3 percent on Friday and ended as the top sectoral performer, even as the markets closed just 21 points up.

All stocks in the index, except Marico, closed in the green, led by Dabur India which rose 5.8 percent and ITC which gained nearly 5 percent.

ITC today reported September net profit rose 26.3 pct, beating forecasts. ITC shares also ended as the top Sensex gainer.

The BSE FMCG index has risen around 25 percent since July, beating that of the Sensex which has clocked 16 percent in the same period.

Would you invest in any of the FMCG stocks now?

Infosys shines in weak market

Shares in Infosys gained over 2.1 percent on Thursday in a broader market that slipped over 200 points.

Gains in Infosys helped the BSE IT index close 0.8 percent higher. Eleven of 16 stocks in the IT index however closed in the red.

The counter has gained nearly 100 percent so far this year, but this is lower than the 162 percent rise in competitor TCS.

Do you think it is wise to invest in Infosys at this stage? Or would you wait for a correction?

Banking index drops

The BSE banking index dropped 1.2 percent on Wednesday in a broader market which ended flat.

The benchmark 30-share Sensex has more than doubled from the lows in early March, registering a rise of more than 78 percent with foreign funds infusing nearly $14 billion in Indian equities.

The BSE banking index on the other hand has risen nearly 90 percent in 2009.

Private lender ICICI Bank, which has a weightage of over 8 percent in the Sensex, dropped 1.6 percent to 928 rupees. The scrip has more than doubled since the start of this year.

The other Bankex stocks that declined were Bank of Baroda (down 4.4 percent), SBI (down 3.2 percent), HDFC Bank (down 1.6 percent) and Union Bank (down 1.2 percent).

Yes Bank today said July-Sep net profit had jumped 75.6 percent from the previous year. The stock ended 3.8 percent down at 244 rupees. The bank plans to raise $150-250 million via equity by March 2010 to meet expansion targets, a senior official said.

Do you think it is a good time to invest in this sector?

Weak day for oil & gas stocks

The BSE Oil & Gas index dropped 1.7 percent on Tuesday, ending as the top sectoral loser of the day as shares of Reliance Industries and ONGC slipped.

Essar Oil was the top loser in the index, closing down 4 percent. ONGC too came under pressure and slipped 2.4 percent.

Reliance Industries ended 1.84 percent lower at 2183 rupees, while Reliance Natural gained 1.2 percent. The Supreme Court today started hearing arguments on the gas dispute between the two companies. Hearings are to continue tomorrow.

Reliance Industries, whose shares have jumped 53 percent this year, recently announced a 1-1 bonus issue and a 13-rupee interim dividend for shareholders. Reliance Natural shares have gained around 40 percent over the same period.

Since August, the oil & gas index has dropped 3 percent. Do you think the sector will be volatile till the Supreme Court decides on the gas dispute between the Ambani brothers?