Money on the markets

Reliance Comm rises on tower deal report

Shares in Reliance Communication rose over 9 percent in trade today after a news channel reported that ATC has emerged as the highest bidder for the firm’s tower arm.

RComm ended 9.3 percent higher at 99.30 rupees and was the top traded stock on BSE. The firm was also the top Sensex gainer.

Reliance Communication after market hours said that it would see annual interest cost savings of more than 5 billion rupees after signing a final loan agreement with China Development Bank.

In 2011, Reliance Communications has slipped over 40 percent. Do you see further downside?

Idea Cellular gains on Etisalat interest

Idea Cellular rose nearly 4 percent after Emirates Telecommunication Corp, the Arab world’s second-largest telecom operator by market value, said it had not ruled out investing in the company.

However, the Abu Dhabi-based operator said that it does not expect a deal with Reliance Communications in 2010. Reliance Communication is the only major local cellular carrier without a foreign strategic investor in the world’s fastest-growing mobile market.

Shares in Idea Cellular ended 3.2 percent higher at 74.05 rupees while shares in Reliance Communications recovered from early losses and ended marginally up.

This year, Idea Cellular has kept investors happy with the counter rising over 20 percent while Reliance Communication has registered a negative return of 5 percent.

Do you think it is the right time to invest in Idea Cellular?

Reliance Comm gains

Shares in Reliance Communications closed 2.2 percent higher on report that Emirates Telecommunications (Etisalat) is close to buying 26 percent in the firm.

The stock was among the top Sensex gainers with volumes of over 1.8 million shares on the BSE.

Last month, Reliance Comm agreed to merge its telecoms communication towers business with that of GTL Infrastructure Ltd in a deal that a source said would cut its debt by $3.9 billion.

Keeping in mind that the counter has gained over 30 percent since June this year, would you invest in Reliance Comm at this stage or wait for a correction?

Reliance Comm surges on report of Etisalat talks

Shares in Reliance Communications jumped 11 percent on Wednesday following a newspaper report that UAE’s Etisalat was in advanced talks to buy a quarter of the Indian firm for 180 billion rupees. Etisalat confirmed it is looking to buy a stake in an Indian mobile operator.

A stake sale could mean a change in strategy for Reliance Comm owner Anil Ambani, who has made several smaller acquisitions to expand his firm overseas.

Shares in Reliance Comm have fallen more than 10 percent this year, hurt by the price war in the domestic telecom sector.

Do you think it is a good opportunity to invest in this counter?

Shares in Ambani-owned firms rally

Shares in companies controlled by the billionaire Ambani brothers were among the big gainers on Monday after the two moved towards resolving a long-running strife.

The BSE Sensex ended 0.15 pct higher led by Reliance Industries which gained 2.5 percent at 1021 rupees.

Shares in Anil Ambani controlled firms like Reliance Communications and Reliance Infrastructure closed up 10.8 percent and 6 percent respectively.

The Ambanis took a step towards reconciliation in their long-running feud on Sunday, ending non-compete agreements in a move they hoped would lead to cooperation between the two groups.

The BSE Oil & Gas Index ended 1.6 percent higher. Reliance Natural closed with gains of over 22.5 percent at 54.55 rupees with volumes of over 24 million shares.

Do you think the reconciliation move by the Ambani brothers will continue to bode well for their companies’ shares?

Bad year for telecom counters

Telecom stocks had a bad year with top counters such as Bharti Airtel and Reliance Communication slipping 8 and 23 percent respectively in 2009.

The overall market however gained as much as 80 percent during the year.

The Sensex ended 81 percent higher at 17465 and gained more than 7,000 points, its biggest yearly gain since 1991.

A price war among telecom operators discouraged investors as there were concerns about future profitability of such companies.

MTNL was another telecom stock that ended the year in the negative, slipping nearly 7 percent. Stocks such as Idea Cellular gained 6.7 percent and Tata Tele rose 23 percent.

Do you think telecom shares make an attractive buy in 2010?

Telecom shares dives in flat market

Shares of major telecom players plunged on Thursday, pulling the BSE Technology Index down 2.8 percent.

Bharti Airtel, which has a 3.6 percent weightage on the Sensex, dropped over 6 percent in a market that ended marginally up at 16,843. Trade in the counter stood at 8.1 million shares.

The other stocks that took a hit included Reliance Communications (down 6 percent), Idea (down 2.2 percent) and MTNL which dropped 1.08 percent.

Fear of survival and reduced profits loom for GSM operators as new entrants could spark a price war which in turn could squeeze the margins of top players.

The telecom regulator (TRAI) on Tuesday asked operators to bill customers on a per-second basis instead of the per-minute billing. TRAI’s move has already resulted in companies altering their plans which could impact their revenue growth.

Rating agency Fitch has highlighted in a statement that EBITDA margins of existing operators is likely to fall on lower ARPUs in the near term.

In an interview with Reuters, DoCoMo’s senior executive vice president, Kiyoyuki Tsujimura, said his company wants to bolster its services with Tata Teleservices.

Reliance Communications gains in choppy market

Shares in Reliance Communications, India’s number 2 mobile operator, ended 5.3 percent higher at 290.70 rupees after the company said it had repaid early more than $1 billion of loans.

Reliance Comm shares had risen nearly 5 percent yesterday with a traded volume of nearly 4.2 million shares. It remained one of the top traded stocks today. This year the stock has surged nearly 28 percent.

Investor sentiment cemented as the No 2 mobile operator said it had repaid early more than $1 billion of loans and could repay more debt ahead of schedule.

The prepayment of loan would definitely have a positive impact on the profitability of the company as it would reduce the interest component of the outflow by as much as 7.5 billion rupees ($153 million) per year.

Reliance Infratel, 95 percent owned by Reliance Communications, said it plans to raise up to 50 billion rupees ($1 billion) by selling at least 10 percent stake to help fund its expansion plans. The company is expected to file the draft prospectus within a week.

The 5th largest mobile operator in the world has interests in telecom towers, VOIP solutions, broadband related services and DTH operations (Big TV).

The company’s revenue surged 15.5 percent to 61,452 million rupees while net profit margin rose 27 percent, but fell 1.8 percent year on year in Q1 FY10. With the new launch of its GSM services in 14 circles, for which the operator shelled out almost $2 billion, it expects significant cash flows from the operations.

TCS leads Sensex over 15,000

The BSE Sensex extended gains on Monday to cross the 15,000 mark as hopes of recovery in corporate earnings boosted confidence worldwide.

The 30-share sensitive index swung from an intra-day low of 14,854 to an intra-day high of 15,209 and closed  446 points higher at 15,191. The fifty-share Nifty ended 2.91 percent higher at 4502.

IT stocks rose on better-than-expected Q1 results by TCS, India’s largest IT exporter by sales, announced after trading hours on Friday. Shares in TCS ended 15.34 percent higher at 500.10 rupees.

On the sectoral front, the BSE IT Index rose 7.2 percent, followed by the Realty Index which ended 4.91 percent higher. However, the BSE FMCG Index closed 0.49 percent lower.

Shares in Reliance Industries, which challenged a lower court ruling to supply gas to Reliance Natural at below-market price, ended 5.03 percent higher, while Reliance Natural shares were down 2.6 percent.

Do you see the market uptrend continuing this week?

Sensex gains 1.8 pct, Satyam surges

The stock market traded firm today and extended gains by 1.8 percent after an extended weekend.

The Sensex closed 186 points higher at 10,534.8, as strong Asian markets helped boost investor sentiments.

HDFC, L&T and Reliance Communications led the benchmark. Mahindra & Mahindra was the top index gainer, closing 14.2 percent higher.

Among sectors, the BSE Consumer Durables Index led with gains of 5.8 percent, followed by the capital goods index which was up 3.75 percent. All indices, barring the FMCG index, closed in positive territory.

It was a good day for Satyam shareholders, as the scrip surged over 13 percent to close at 45.15 rupees. It was also the top traded stock on the BSE with volumes of over 28 million shares.

There seems to be an improvement in market sentiment – it was the fourth straight session of gains for the benchmark. Do you think the rally is sustainable? Is 11,000 achievable this week?