ICICI Securities maintains buy on State Bank of India
1 Nov, 2008.
ICICI Securities has maintained its “buy” rating on SBI, with a price target of Rs1,668, after its second quarter results. “We raise estimated FY09 and FY10 earnings by 8.2% and 4.1% respectively, but lower estimates for other businesses and associate banks,” the brokerage said in a client note.
The state-owned bank’s July-September quarter results exceeded market and ICICI Securities’ estimates. “We believe NIMs (net interest margins) will hold at roughly 3% despite funding cost pressures on account of the recent CRR cut and the pricing power enjoyed by banks,” it added.
Saturday, November 1, 2008
Sunday, October 19, 2008
SBI
Top 10 cos lose Rs 94kcr in a week; SBI defies trend
19 Oct, 2008.
MUMBAI: With stock markets continuing their downslide, the country's elite club of most valued firms lost over Rs 94,000 crore in a week, though S
BI defied the trend and added nearly Rs 4,000 crore to its market capitalisation.
The combined market capitalisation of the country's top 10 firms saw an erosion of Rs 94,448 crore in the past week, dropping to Rs 10,44,245 crore at the end of trading on Friday last week from the previous week's Rs 11,38,734 crore.
Country's largest lender State Bank of India defied trend in the falling market and gained Rs 3,923 crore to Rs 89,768 crore. Last week witnessed banking stocks mostly trading in the negative territory, while SBI outperformed its peers and managed to increase its market capitalisation.
Analysts believe SBI's strong fundamentals support the better performance of its shares amid the bearish market conditions.
However, country's largest private sector lender ICICI Bank, which slipped from the top-20 club last week and lost its position to the HDFC Bank, has regained its position.
While ICICI Bank's market capitalisation rose to Rs 43,606 crore last week from Rs 40,532 crore previously, HDFC Bank's valuation took a marginal dip to Rs 43,533.39 crore.
Country's most valued firm Reliance Industries suffered the highest fall in its market capitalisation of Rs 34,898 crore during the past week. However, the Mukesh Ambani-led firm retained its numero-uno position with a valuation of Rs 2,05,418 crore last week.
19 Oct, 2008.
MUMBAI: With stock markets continuing their downslide, the country's elite club of most valued firms lost over Rs 94,000 crore in a week, though S
BI defied the trend and added nearly Rs 4,000 crore to its market capitalisation.
The combined market capitalisation of the country's top 10 firms saw an erosion of Rs 94,448 crore in the past week, dropping to Rs 10,44,245 crore at the end of trading on Friday last week from the previous week's Rs 11,38,734 crore.
Country's largest lender State Bank of India defied trend in the falling market and gained Rs 3,923 crore to Rs 89,768 crore. Last week witnessed banking stocks mostly trading in the negative territory, while SBI outperformed its peers and managed to increase its market capitalisation.
Analysts believe SBI's strong fundamentals support the better performance of its shares amid the bearish market conditions.
However, country's largest private sector lender ICICI Bank, which slipped from the top-20 club last week and lost its position to the HDFC Bank, has regained its position.
While ICICI Bank's market capitalisation rose to Rs 43,606 crore last week from Rs 40,532 crore previously, HDFC Bank's valuation took a marginal dip to Rs 43,533.39 crore.
Country's most valued firm Reliance Industries suffered the highest fall in its market capitalisation of Rs 34,898 crore during the past week. However, the Mukesh Ambani-led firm retained its numero-uno position with a valuation of Rs 2,05,418 crore last week.
Saturday, October 11, 2008
Boost Liquidity
India's Subbarao Is Ready for `Swift' Steps to Boost Liquidity
By Shobhana Chandra
Oct. 11 (Bloomberg) -- Indian central bank Governor Duvvuri Subbarao said he's prepared to take ``effective'' steps to maintain liquidity in the nation's credit markets and repeated the bank's policy of smoothing swings in the currency.
We ``stand ready to take appropriate, effective and swift action'' to provide liquidity, he told reporters yesterday in Washington, where he was attending a meeting of Group of 20 finance ministers and central bankers. He said India's economy is ``strong'' and its banks are ``sound'' and ``well capitalized.''
India yesterday made the steepest cut since 2001 in the amount of cash lenders must set aside as reserves to kick-start the $1.2 trillion economy, as the rupee plunged to an all-time low and overseas investors dumped emerging-market stocks. The drop in the cash-reserve ratio followed a reduction on Oct. 6.
Subbarao, 59, declined to comment on interest-rate policy, saying that ``all variables are up for review'' at the Reserve Bank of India's Oct. 24 policy meeting. While the latest figures on inflation are ``quite comforting,'' it is ``still too early to let the vigil slip'' on prices, he said.
India's inflation has slowed to a 15-week low of 11.8 percent, according to the latest government figures, though it is still more than double the central bank's target.
Steps taken so far to improve liquidity in the Indian financial system amount to as much as $22 billion, Subbarao said.
The governor also said that in the medium term, India's rupee ``should be determined by market fundamentals.'' The RBI's policy, to ``manage exchange-rate volatility'' rather than take a view on its level, ``should continue to serve us well,'' he said.
`Knock-On Effect'
Indian markets are experiencing a ``knock-on effect'' from the global financial crisis, because the country's banks have no direct exposure to U.S. sub-prime mortgages, Subbarao said. The RBI's priorities include ``managing inflation while maintaining the growth momentum,'' and financial stability has become another objective over the last three months, he said.
Subbarao this week rushed to free up cash after money-market rates surged to an 18-month high and financial stocks slumped. ICICI Bank Ltd., the Indian lender with the biggest losses on overseas investments, dropped by a record on Oct. 10, forcing the bank to reiterate it had sufficient funds.
Some economists predict the RBI may follow central banks worldwide and cut interest rates as inflation pressures ease and the worsening global crisis begins to weaken economic growth.
``India has been cautious in its reaction until now,'' Swaminathan Aiyar, a Cato Institute research fellow with a focus on Asia, said in Washington. ``Subbarao clearly believes in balance'' between the policy objectives of growth and inflation. ``A rate cut is coming.''
Rescue Plans
Subbarao, who took over as RBI governor a month ago, said the problems and perspectives of countries directly affected by the global financial crisis are ``quite different'' from those of nations like India that are affected indirectly.
Relief and rescue plans announced by advanced countries so far don't include components in which peripheral countries such as India could participate, he said.
Still, India would ``hope to be included and involved in the design and implementation'' of such an effort, should there be a need, he said.
To contact the reporter on this story: Shobhana Chandra in Washington at schandra1@bloomberg.net
Last Updated: October 11, 2008
By Shobhana Chandra
Oct. 11 (Bloomberg) -- Indian central bank Governor Duvvuri Subbarao said he's prepared to take ``effective'' steps to maintain liquidity in the nation's credit markets and repeated the bank's policy of smoothing swings in the currency.
We ``stand ready to take appropriate, effective and swift action'' to provide liquidity, he told reporters yesterday in Washington, where he was attending a meeting of Group of 20 finance ministers and central bankers. He said India's economy is ``strong'' and its banks are ``sound'' and ``well capitalized.''
India yesterday made the steepest cut since 2001 in the amount of cash lenders must set aside as reserves to kick-start the $1.2 trillion economy, as the rupee plunged to an all-time low and overseas investors dumped emerging-market stocks. The drop in the cash-reserve ratio followed a reduction on Oct. 6.
Subbarao, 59, declined to comment on interest-rate policy, saying that ``all variables are up for review'' at the Reserve Bank of India's Oct. 24 policy meeting. While the latest figures on inflation are ``quite comforting,'' it is ``still too early to let the vigil slip'' on prices, he said.
India's inflation has slowed to a 15-week low of 11.8 percent, according to the latest government figures, though it is still more than double the central bank's target.
Steps taken so far to improve liquidity in the Indian financial system amount to as much as $22 billion, Subbarao said.
The governor also said that in the medium term, India's rupee ``should be determined by market fundamentals.'' The RBI's policy, to ``manage exchange-rate volatility'' rather than take a view on its level, ``should continue to serve us well,'' he said.
`Knock-On Effect'
Indian markets are experiencing a ``knock-on effect'' from the global financial crisis, because the country's banks have no direct exposure to U.S. sub-prime mortgages, Subbarao said. The RBI's priorities include ``managing inflation while maintaining the growth momentum,'' and financial stability has become another objective over the last three months, he said.
Subbarao this week rushed to free up cash after money-market rates surged to an 18-month high and financial stocks slumped. ICICI Bank Ltd., the Indian lender with the biggest losses on overseas investments, dropped by a record on Oct. 10, forcing the bank to reiterate it had sufficient funds.
Some economists predict the RBI may follow central banks worldwide and cut interest rates as inflation pressures ease and the worsening global crisis begins to weaken economic growth.
``India has been cautious in its reaction until now,'' Swaminathan Aiyar, a Cato Institute research fellow with a focus on Asia, said in Washington. ``Subbarao clearly believes in balance'' between the policy objectives of growth and inflation. ``A rate cut is coming.''
Rescue Plans
Subbarao, who took over as RBI governor a month ago, said the problems and perspectives of countries directly affected by the global financial crisis are ``quite different'' from those of nations like India that are affected indirectly.
Relief and rescue plans announced by advanced countries so far don't include components in which peripheral countries such as India could participate, he said.
Still, India would ``hope to be included and involved in the design and implementation'' of such an effort, should there be a need, he said.
To contact the reporter on this story: Shobhana Chandra in Washington at schandra1@bloomberg.net
Last Updated: October 11, 2008
Sunday, September 28, 2008
Ranbaxy Labs
Ranbaxy Labs: Canadian jolt
September 28, 2008
The stock closed at almost a six-year low on Friday on a report that the Canadian drug regulator, Health Canada, had issued a notice to the company to review its medicines. Earlier, the stock was under pressure on the USFDA’s decision to ban import of 30 of its drugs manufactured at its facilities in Paonta Sahib and Dewas.
The scrip fell from Rs 356.85 to Rs 272.39 during the week, reporting an almost four-fold rise in the combined turnover on the bourses. A total 30.6 million equity shares were traded on BSE and NSE last week against 8.24 million shares changing hands in the previous week.
Ranbaxy Laboratories, the country’s largest drug-maker by sales, dropped as much as 40 per cent from Rs 453.95, after the US drug regulator blocked the sale of more than 30 generic medicines and seven APIs made at its two facilities.
September 28, 2008
The stock closed at almost a six-year low on Friday on a report that the Canadian drug regulator, Health Canada, had issued a notice to the company to review its medicines. Earlier, the stock was under pressure on the USFDA’s decision to ban import of 30 of its drugs manufactured at its facilities in Paonta Sahib and Dewas.
The scrip fell from Rs 356.85 to Rs 272.39 during the week, reporting an almost four-fold rise in the combined turnover on the bourses. A total 30.6 million equity shares were traded on BSE and NSE last week against 8.24 million shares changing hands in the previous week.
Ranbaxy Laboratories, the country’s largest drug-maker by sales, dropped as much as 40 per cent from Rs 453.95, after the US drug regulator blocked the sale of more than 30 generic medicines and seven APIs made at its two facilities.
Thursday, September 18, 2008
ICICI Bank denies talk of share sale by top management
17 Sep, 2008.
MUMBAI: ICICI Bank has dubbed rumours about top management selling the company’s shares over the last few days as baseless and irresponsible.
No shares have been sold by members of the top management of the bank during the current year, the bank said in a release.
ICICI Bank is taking up this matter with regulatory authorities for necessary action against those responsible for the rumours.
Towards end of Wednesday’s trade, ICICI Bank shares were down 4.92 per cent at Rs 362.25 on BSE. The stock had fallen to a low of Rs 530 earlier.
17 Sep, 2008.
MUMBAI: ICICI Bank has dubbed rumours about top management selling the company’s shares over the last few days as baseless and irresponsible.
No shares have been sold by members of the top management of the bank during the current year, the bank said in a release.
ICICI Bank is taking up this matter with regulatory authorities for necessary action against those responsible for the rumours.
Towards end of Wednesday’s trade, ICICI Bank shares were down 4.92 per cent at Rs 362.25 on BSE. The stock had fallen to a low of Rs 530 earlier.
Wednesday, September 10, 2008
Indiabulls Real Estate
Deutsche Securities puts 'hold' on Indiabulls Real Estate
10 Sep, 2008,
Indiabulls Real Estate
cmp: Rs 286.80
target price: Rs 300
Deutsche Securities has initiated coverage on Indiabulls Real Estate with a ‘hold’ rating as it feels the company has limited track record in execution. Weakness in the Mumbai office market for high-end office properties, and a large free float — which allows much larger head-room for “borrowing” and selling short — are downsides for the stock.
According to a Deutsche Bank note, Indiabulls’ revenue growth would be driven by volumes and stake sale of associate and/or subsidiaries. “We expect a revenue CAGR (compound annual growth rate) of 41% over FY08 to FY11 (estimated). \
We expect EBITDA margins to drop from 72% in FY08 to 55% in FY11 (estimated), mainly driven by higher costs (land, construction, employees, SG&A).
Further, we expect the tax rate to increase from around 28% in FY08 to nearly 30% in FY11 (estimated). Thus, while we expect volume growth (around 40%), we expect PAT (profit after tax) to grow by only a 19% CAGR over FY08-11 (estimated),” the note to clients said.
However, the Deutsche Bank note added that the demerging and listing of its forays in power and retailing would drive growth and shareholder value in the near term. Meanwhile, SEZs, townships and annuities from completed projects will drive long-term growth, it added.
10 Sep, 2008,
Indiabulls Real Estate
cmp: Rs 286.80
target price: Rs 300
Deutsche Securities has initiated coverage on Indiabulls Real Estate with a ‘hold’ rating as it feels the company has limited track record in execution. Weakness in the Mumbai office market for high-end office properties, and a large free float — which allows much larger head-room for “borrowing” and selling short — are downsides for the stock.
According to a Deutsche Bank note, Indiabulls’ revenue growth would be driven by volumes and stake sale of associate and/or subsidiaries. “We expect a revenue CAGR (compound annual growth rate) of 41% over FY08 to FY11 (estimated). \
We expect EBITDA margins to drop from 72% in FY08 to 55% in FY11 (estimated), mainly driven by higher costs (land, construction, employees, SG&A).
Further, we expect the tax rate to increase from around 28% in FY08 to nearly 30% in FY11 (estimated). Thus, while we expect volume growth (around 40%), we expect PAT (profit after tax) to grow by only a 19% CAGR over FY08-11 (estimated),” the note to clients said.
However, the Deutsche Bank note added that the demerging and listing of its forays in power and retailing would drive growth and shareholder value in the near term. Meanwhile, SEZs, townships and annuities from completed projects will drive long-term growth, it added.
Saturday, August 30, 2008
Infosys Tech
Analysts'Picks: Infosys Tech
27 Aug, 2008
Infosys Tech
cmp: Rs 1,697.60
target price: Rs 1,703
Broking firm Edelweiss Securities has maintained its ‘accumulate’ rating on the stock as it believes that the company’s recent acquisition of the Axon group would bolster the company’s presence in the consulting space.
“The deal is earnings per share (EPS) neutral on standalone basis in FY09 (estimated), but EPS accretion in FY10 (estimated) depends on Axon’s growth and margin trajectory. Incorporating the financial impact of this acquisition, the stock trades at 16.5 times and 13.9 times FY09 and FY10 earnings respectively,” the note said. However, according to the brokerage firm, slowdown in US, significant increase in the salary hikes and attrition rate, reduction in the number of H1B visas granted by US, and incremental appreciation of rupee against US dollar, euro and GBP remain key concerns for the company.
27 Aug, 2008
Infosys Tech
cmp: Rs 1,697.60
target price: Rs 1,703
Broking firm Edelweiss Securities has maintained its ‘accumulate’ rating on the stock as it believes that the company’s recent acquisition of the Axon group would bolster the company’s presence in the consulting space.
“The deal is earnings per share (EPS) neutral on standalone basis in FY09 (estimated), but EPS accretion in FY10 (estimated) depends on Axon’s growth and margin trajectory. Incorporating the financial impact of this acquisition, the stock trades at 16.5 times and 13.9 times FY09 and FY10 earnings respectively,” the note said. However, according to the brokerage firm, slowdown in US, significant increase in the salary hikes and attrition rate, reduction in the number of H1B visas granted by US, and incremental appreciation of rupee against US dollar, euro and GBP remain key concerns for the company.
Friday, August 15, 2008
Reliance
Vornado, RIL team up for shopping centres
August 15, 2008,
The US-based real estate investment trust Vornado Realty Trust has announced an equal joint venture with the Mukesh Ambani-led Reliance Industries to acquire, develop and operate shopping malls in India. Both partners will invest $250 million (nearly Rs 1,000 crore) each in the JV.
“The shopping centers, spread over 5,00,000 to 10 lakh square feet or more, will be anchored by a hypermarket owned and operated by Reliance,” Vornado said.
The JV is expected to boost the expansion plans of RIL’s retail venture Reliance Retail, which operates 700 multiple-format stores across 60 cities, encompassing 3.5 million sqft.
Reliance Retail has announced ambitious plans to the tune of Rs 25,000 crore. The retailer runs neighbourhood store Reliance Fresh, consumer durable chain Reliance Digital, hypermarket chain Reliance Mart, apparel chain Reliance Trends and footwear chain Reliance Footprint.
The New York Stock Exchange-listed Vornado already has an exposure to the Indian realty market. The company has an aggregate investment nearing $91 million and capital commitments of $92 million in joint ventures across the country. Vornado Realty Fund, an integrated real estate investment trust, owns over 100 million sq ft of office, retail and other properties in the US.
Retail rentals have doubled in most premium locations across Mumbai, Delhi and Bangalore in the last three years. Retailers have been hit hard due to the soaring realty prices, delays in getting properties and reduction in footfalls.
In a bid to counter this, most retailers have floated their own funds that invest in shopping malls or formed JVs to invest in real estate.
Future Group, which houses India’s largest retailer Pantaloons, has floated Kshitij realty fund that invests in the group’s shopping malls. Tata’s retail arm Trent has tied up with private equity firm The Xander Group to float a retail real estate fund, while Aditya Birla Retail, formed by AV Birla group, has plans to float a retail real estate fund.
The domestic retail market that is currently valued at $511 billion, is projected to grow to $833 billion in the next five years. Organised retail is expected to grow by 40 per cent every year to $107 billion by 2013, according to retail consultancy AT Kearney.
Property consultancy CB Richard Ellis sees a likelihood of nearly 100 million sq ft retail property being developed. Some of the biggest shopping centre developers and investors have started their operations in the country. South Africa’s Old Mutual Property Investments, the UK’s Liberty International, Israel’s Plaza Centres and Metro Junction have announced plans in the country.
Analysts are however concerned about an impending oversupply of space in the retail sector. “Over-supply and saturation may result in correction of rentals in certain pockets and micro-markets in the short to medium-term,’’ said a report from property consultancy CB Richard Ellis.
August 15, 2008,
The US-based real estate investment trust Vornado Realty Trust has announced an equal joint venture with the Mukesh Ambani-led Reliance Industries to acquire, develop and operate shopping malls in India. Both partners will invest $250 million (nearly Rs 1,000 crore) each in the JV.
“The shopping centers, spread over 5,00,000 to 10 lakh square feet or more, will be anchored by a hypermarket owned and operated by Reliance,” Vornado said.
The JV is expected to boost the expansion plans of RIL’s retail venture Reliance Retail, which operates 700 multiple-format stores across 60 cities, encompassing 3.5 million sqft.
Reliance Retail has announced ambitious plans to the tune of Rs 25,000 crore. The retailer runs neighbourhood store Reliance Fresh, consumer durable chain Reliance Digital, hypermarket chain Reliance Mart, apparel chain Reliance Trends and footwear chain Reliance Footprint.
The New York Stock Exchange-listed Vornado already has an exposure to the Indian realty market. The company has an aggregate investment nearing $91 million and capital commitments of $92 million in joint ventures across the country. Vornado Realty Fund, an integrated real estate investment trust, owns over 100 million sq ft of office, retail and other properties in the US.
Retail rentals have doubled in most premium locations across Mumbai, Delhi and Bangalore in the last three years. Retailers have been hit hard due to the soaring realty prices, delays in getting properties and reduction in footfalls.
In a bid to counter this, most retailers have floated their own funds that invest in shopping malls or formed JVs to invest in real estate.
Future Group, which houses India’s largest retailer Pantaloons, has floated Kshitij realty fund that invests in the group’s shopping malls. Tata’s retail arm Trent has tied up with private equity firm The Xander Group to float a retail real estate fund, while Aditya Birla Retail, formed by AV Birla group, has plans to float a retail real estate fund.
The domestic retail market that is currently valued at $511 billion, is projected to grow to $833 billion in the next five years. Organised retail is expected to grow by 40 per cent every year to $107 billion by 2013, according to retail consultancy AT Kearney.
Property consultancy CB Richard Ellis sees a likelihood of nearly 100 million sq ft retail property being developed. Some of the biggest shopping centre developers and investors have started their operations in the country. South Africa’s Old Mutual Property Investments, the UK’s Liberty International, Israel’s Plaza Centres and Metro Junction have announced plans in the country.
Analysts are however concerned about an impending oversupply of space in the retail sector. “Over-supply and saturation may result in correction of rentals in certain pockets and micro-markets in the short to medium-term,’’ said a report from property consultancy CB Richard Ellis.
Saturday, August 9, 2008
JP Associates
AnandRathi puts 'buy' on JP Associates; target Rs 232
6 Aug, 2008,
AnandRathi has advised buying Jaiprakash Associates at around the current price for a target of Rs 232 and a stop loss of Rs 168.
JP Associates, after a descent consolidation exhibits a trend reversal, rise in RSI from over sold zone indicates a medium term buy.
Based on the chart pattern developed to date, the stock is likely to get support around Rs.170.
The brokerage suggests accumulating more if the stock comes close to the support level. If it moves above Rs 232 level then it can even touch Rs 254 levels.
6 Aug, 2008,
AnandRathi has advised buying Jaiprakash Associates at around the current price for a target of Rs 232 and a stop loss of Rs 168.
JP Associates, after a descent consolidation exhibits a trend reversal, rise in RSI from over sold zone indicates a medium term buy.
Based on the chart pattern developed to date, the stock is likely to get support around Rs.170.
The brokerage suggests accumulating more if the stock comes close to the support level. If it moves above Rs 232 level then it can even touch Rs 254 levels.
Wednesday, August 6, 2008
HPCL
ICICI Securities maintains a 'buy' on HPCL
6 Aug, 2008
CMP: Rs 234.20
Target price: NA
ICICI Securities has maintained a ‘buy’ rating on HPCL even after the company reported a recurring loss of Rs 880 crore in the first quarter of the current financial year due to lower than expected subsidy support from the government and upstream companies.
The brokerage expects subsidy support to increase over the year as the government has not yet accounted for the Rs 40,000 crore unallocated burden. “Though we continue to believe that the stock may remain subdued in the short term till the government decides the final subsidy burden-sharing formula, the company is trading at a significant discount to the replacement value of its asset,” says the report.
The brokerage also highlights the fact that risks of further increase in interest costs along with expectations of a fall in refining margins could potentially impact earnings. Positive surprise, however, on higher subsidy sharing by upstream companies and oil bonds could be a boost to stock prices, it adds.
Positive news on the E&P front and implementation of subsidy reforms recommended by the Rangarajan Committee could trigger re-rating in the stock, says the report.
6 Aug, 2008
CMP: Rs 234.20
Target price: NA
ICICI Securities has maintained a ‘buy’ rating on HPCL even after the company reported a recurring loss of Rs 880 crore in the first quarter of the current financial year due to lower than expected subsidy support from the government and upstream companies.
The brokerage expects subsidy support to increase over the year as the government has not yet accounted for the Rs 40,000 crore unallocated burden. “Though we continue to believe that the stock may remain subdued in the short term till the government decides the final subsidy burden-sharing formula, the company is trading at a significant discount to the replacement value of its asset,” says the report.
The brokerage also highlights the fact that risks of further increase in interest costs along with expectations of a fall in refining margins could potentially impact earnings. Positive surprise, however, on higher subsidy sharing by upstream companies and oil bonds could be a boost to stock prices, it adds.
Positive news on the E&P front and implementation of subsidy reforms recommended by the Rangarajan Committee could trigger re-rating in the stock, says the report.
Tuesday, July 29, 2008
RBI hiked CRR
Interest rates set to harden: BankersPosted online: Tuesday , July 29, 2008
Bankers on Tuesday said both lending and deposit rates are likely to go up by a minimum of 0.5 per cent, as a fall out of Reserve Bank announcing a hike in short-term lending rate and cash reserve requirement of banks.
"We have to assess what is the actual impact and a decision would be taken accordingly. A minimum 0.5 per cent hike in our BPLR and deposit rates cannot be ruled out," state-owned Punjab National Bank's Chairman and Managing Director K C Chakarabarty said in Mumbai.
Announcing the quarterly review of credit policy, RBI hiked CRR by 0.25 per cent to 9 per cent and Repo by 0.5 per cent to 9 per cent.
Union Bank of India's Chirman and Managing Director M V Nair said the bank's Asset Liability Committee (ALCO) would look at the liquidity condition of the bank after the hike.
The lender is likely to up its BPLR, Nair said, but did not say what would be the range of revision. "Our ALCO will meet soon to assess the impact. There is a clear pressure on the profitability of banks after the present hikes in RBI key-rates. We may revise our BPLR upwards," Nair said.
Bankers on Tuesday said both lending and deposit rates are likely to go up by a minimum of 0.5 per cent, as a fall out of Reserve Bank announcing a hike in short-term lending rate and cash reserve requirement of banks.
"We have to assess what is the actual impact and a decision would be taken accordingly. A minimum 0.5 per cent hike in our BPLR and deposit rates cannot be ruled out," state-owned Punjab National Bank's Chairman and Managing Director K C Chakarabarty said in Mumbai.
Announcing the quarterly review of credit policy, RBI hiked CRR by 0.25 per cent to 9 per cent and Repo by 0.5 per cent to 9 per cent.
Union Bank of India's Chirman and Managing Director M V Nair said the bank's Asset Liability Committee (ALCO) would look at the liquidity condition of the bank after the hike.
The lender is likely to up its BPLR, Nair said, but did not say what would be the range of revision. "Our ALCO will meet soon to assess the impact. There is a clear pressure on the profitability of banks after the present hikes in RBI key-rates. We may revise our BPLR upwards," Nair said.
Friday, July 18, 2008
Bharti Airtel
Buy Bharti Airtel for target Rs 1,150: Religare
29 Jul, 2008
MUMBAI: Religare Research has maintained ‘buy’ on Bharti Airtel for a target price of Rs 1,150. The company has released a good set of numbers in April-June 2008-09, ahead of the brokerage estimates. Strong subscriber additions in conjunction with higher mobile traffic from existing and new clients supported a revenue growth of 8.5 per cent quarter on quarter.
A decrease in STD rates and roaming charges boosted mobile traffic volumes but caused margins in the segment to decline. In a further dampener to mobile margins, the licence fee concession period in six circles expired during the quarter, elevating licence costs. However, average revenue per user in the mobile segment bettered Religare’s estimate of Rs 350, a marginal decline of 2 per cent quarter on quarter against their expectation of a 5.2 per cent decline.
Religare has revised their ARPU assumption since the gestation period for rural customers is proving to be lower than anticipated, with traffic picking up at a rapid pace. The brokerage has increased their revenue and earnings estimates for 2008-09 and 2009-10 based on strong subscriber additions and their revised ARPU assumptions.
The stock is trading at 16.8x and 13.8x expected FY09 and FY10 earnings of Rs 47.4 and Rs 57.7 respectively.
29 Jul, 2008
MUMBAI: Religare Research has maintained ‘buy’ on Bharti Airtel for a target price of Rs 1,150. The company has released a good set of numbers in April-June 2008-09, ahead of the brokerage estimates. Strong subscriber additions in conjunction with higher mobile traffic from existing and new clients supported a revenue growth of 8.5 per cent quarter on quarter.
A decrease in STD rates and roaming charges boosted mobile traffic volumes but caused margins in the segment to decline. In a further dampener to mobile margins, the licence fee concession period in six circles expired during the quarter, elevating licence costs. However, average revenue per user in the mobile segment bettered Religare’s estimate of Rs 350, a marginal decline of 2 per cent quarter on quarter against their expectation of a 5.2 per cent decline.
Religare has revised their ARPU assumption since the gestation period for rural customers is proving to be lower than anticipated, with traffic picking up at a rapid pace. The brokerage has increased their revenue and earnings estimates for 2008-09 and 2009-10 based on strong subscriber additions and their revised ARPU assumptions.
The stock is trading at 16.8x and 13.8x expected FY09 and FY10 earnings of Rs 47.4 and Rs 57.7 respectively.
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