Share Market News – 12 Dec 2016

Share Market Updates

JP Power to transfer Karchana Thermal Power Project to Govt. of UP; also approved divestment of Sangam Power Generation and restructure FCCBs worth $101.42mn; we believe divestment and restructuring the debt will be beneficial for JP Power to reduce debt.

 Titagarh Wagons gets orders for construction of 2 Fuel Barges for Indian Navy, positive read-thru

 Tata Motors global wholesale sales rise 1% in November 2016; in line with estimates

Tata Motors reported a 1% rise in global wholesales at 91,832 units in November 2016. In the passenger vehicles category, sales stood at 64,862 units as against 61,629 units during the same period a year ago, up 5%. Sales of luxury brand Jaguar Land Rover grew 1.5% to 51,792 units during the month. Sales of commercial vehicles declined by 7% to 26,970 units from 29,066 units in the corresponding month. 

Mahindra launches CNG variant of mini-truck Jeeto; positive read thru

(M&M) has launched the CNG variant of its popular mini-truck Jeeto, priced at Rs. 3.49 lakh (ex-showroom, Delhi). The variant will be available at the top-end model of Jeeto X716.The Jeeto CNG is powered by an advanced engine that delivers 11.9 kW (16 hp) and torque of 38 Nm at 1,200–2,000 rpm. As per the company, the variant ensures superior pick-up, acceleration and gradeability, allowing it to carry heavy loads even up the steepest slopes.

 CESC claims to have improved Kota power supply situation after taking over the distribution in September 2016; positive for CESC

 Bata India – Life Insurance Corporation (LIC) has hiked its stake in footwear major Bata India by 2.03 per cent (26.11 lakh shares), taking its total shareholding to 7.05 per cent in the company – sentimentally positive for the stock

 M&M announces no production days on back of fall in demand due to demonetization; negative read thru but stock has already corrected 16% post demonetization move.

M&M has announced it will observe No Production days at its automotive and tractor plants including the Chakan plant of its subsidiary Mahindra Vehicle Manufacturers Ltd to optimize inventory levels. The company has not quantified the days of no production. M&M has witnessed fall in the demand post demonetization (Nov auto sales and tractor sales dipped by 22% and 21%). The sales are likely to remain weak in near term given M&M derives significant sales from rural areas which have been more impacted by demonetization move. Negative read thru but the stock has corrected by 16% post the demonetization announced.

 UPL Limited’s wholly owned subsidiary, UPL corporation limited has sold its stake of 19.22% in Villa Crop Protection Mauritius for a total consideration of Rs 22 crore to an affiliate company of Land O’ Lakes INC. Positive read thru ….. 

 IT sector: Donald Trump rakes up H1B visa issue again, says ‘won’t allow foreign workers to replace Americans’, potentially negative for Indian IT sector  

Continuing its pre election rhetoric’s, President-elect Donald Trump has said he would not allow Americans to be replaced by foreign workers, in an apparent reference to cases like that of Disney World and other American companies wherein people hired on H-1B visas, including Indians, displaced US workers. Disney World and two outsourcing companies have been slapped with a federal lawsuit by two of its former technology staff, alleging that they conspired to displace American workers with cheaper foreign labour brought to the US on H-1B visas, mostly from India.

TCS makes it to shortlist for GST interface

TCS was among the 34 firms short-listed today to provide interface between the new GST server and taxpayers. Prominent among the short-listed are Karvy Data Management, Mastek, MothersonSumi Infotech, NSDL e-Governance Infrastructure, Ramco System, Reliance Corporate IT Park Ltd and Tera Software, according to GSTN.

Atul Ltd: AKZONOBEL and ATUL to jointly build MCA Plant in India, long term positive for Atul Ltd

AkzoNobel and Atul Ltd have agreed to jointly set up a manufacturing plant for monochloroacetic acid (MCA) at Atul’s facility in Gujarat. Each partner will hold a 50% stake in the venture. The partnership will build on Atul’s status as a leading global supplier of the herbicide 2,4-D (which uses MCA as a key raw material), and AkzoNobel’s leading global position in MCA market, with plants in the Netherlands, China, Japan and the US.

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