Market weakens; breadth worsens
The market weakened in mid-afternoon trade. Cement, banking, IT and auto shares edged lower. Index heavyweight Reliance Industries (RIL) had pared gains.
The market-breadth weakened further. Against 1,884 shares that declined on BSE, 691 rose. Just 56 shares were unchanged. Losers outpaced gainers by a ratio of 2.7:1.At 14:29 IST the Sensex was down 90 points, at 14,313. It had hit a low of 14,279.49 at 14:09 IST. At this low, the barometer index had lost 123.41 points for the day. The Sensex had moved in a narrow range till early-afternoon trade.The BSE clocked a turnover of Rs 2906 crore.
Cement shares had edged lower. Grasim lost 2.6% to Rs 2580, and Gujarat Ambuja Cements shed 1.6% to Rs 130. However, ACC came off the lower level. The ACC stock was flat at Rs 1016.45, off the session’s low of Rs 1002.
Hindustan Lever advances after results
Hindustan Lever rose 1% to Rs 207.25, despite the marginal 1.85% fall in net profit for the December 2006 quarter.The Hindustan Lever (HLL) counter clocked volumes of 20.31 lakh shares on BSE. The stock had gained before the results, from Rs 200.25 on 14 February to Rs 205.10 by 19 February 2007.
The results, a fall in net profit nothwithstanding, are better than expectations.
HLL posted 1.85% fall in net profit to Rs 511.18 crore for the quarter ended December 2006, whereas the same was at Rs 520.86 crore for the quarter ended December 2005. Total income for the December 2006 quarter increased to Rs 3263.05 crore (Rs 3038.53 crore).
For the year ended December 2006, HLL posted a net profit of Rs 1855.37 crore, whereas the same was at Rs 1408.10 crore for the year ended December 2005. Total income increased to Rs 12457.91 crore (Rs 11365.33 crore).
On a consolidated basis, the group posted a net profit (after minority interest) of Rs 1890.53 crore for the year ended December 2006, whereas the same was at Rs 1355.92 crore for the year ended December 2005. Total income rose to Rs 12803.90 crore (Rs 11879.21 crore).
The results for the quarter are not comparable to the extent of amalgamation of Vashisti Detergents with the company, and the demerger and subsequent disposal of Doom Dooma and TEI plantation.
HLL has recommended a payment of Rs 3 per share on face value of Re 1 each by way of final dividend, making a total of Rs 6 per share, for the year ended December 2006.
During the year, continuing sales grew 10% and FMCG sales grew 12.8%. Home and personal care (HPC) sales grew 13.7%, led by double digit growth in laundry, toothpaste and food sales grew by 9%. Exceptional items (net of tax) for the December 2006 quarter comprise profit arising from disposal of 51% share in a subsidiary (Rs 36.74 crore); reduction in liability for retirement benefits arising from impact of revised interest rates and lower annuity costs (Rs 21.89 crore); and restructuring costs in the foods business (Rs 30.88 crore).
The highly competitive laundry category continued to perform well with strong volume-led growth across the portfolio. The Close Up brand led growth in toothpaste. Personal wash growth was led by Lifebuoy, Pears and Lux. Shampoo growth was modest due to a high comparator in the previous year and skin category growth was affected due to a late and short winter. Strong innovations continued during the quarter and included the relaunch of Breeze, Vaseline Body Lotion, Lux Body Wash, Scalp Oil control variant of Clinic All-Clear and Ponds Age Miracle at the top end of the skin-care market.
Foods business grew by 10.9%. In beverages, Taaza was relaunched during the quarter, aiding the growth witnessed in tea. Coffee had another quarter of good growth, led by instant coffee. Strong performances by the Kissan portfolio and Knorr range drove the processed foods growth in this quarter. The ice-cream business continued to show double digit growth led by the impulse category and wider availability.
Earlier this month, Hindustan Lever launched its flagship beauty brand Dove's, a hair-care range in India. Currently, Dove's hair-care products are available in India only through third party imports. Unilever plans to discontinue this route, and market the new Dove shampoos and conditioners through the home and personal care (HPC) division of HLL.
HLL plans to roll out three variants of the shampoo and conditioner combo: essential care, daily care and moisture therapy. Based on the performance of these three variants, HLL will unveil other products from Unilever's international Dove portfolio - which includes hair gel, cream and advanced care.
In the Indian hair-care space, HLL is the leader with 48% market share. Dove's new launch is likely to face competition from P&G's Pantene range, L'Oreal's portfolio and other entrants as well as from domestic players like CavinKare, Marico and others.
The size of the hair-care market in India is Rs 3,800 crore, and is growing at 6% per annum. 'Dove is considered to be one of the most premium brands in the market, but has been a fast growing brand for the company. After introducing the soap at a lower price point, it has seen higher value growth,' said an industry analyst.
HPCL on the move
Hindustan Petroleum Corporation advanced 2.25% to Rs 288.15, after the petroleum minister said the Lakshmi Mittal group had picked up 49% stake in a refinery being built by the company.
The investment comes a year after Bharat Petroleum (BP) pulled out saying the project was not attractive. BP, in March 2006, quit plans to help build the new refinery -- then valued at $3 billion -- as it did not find India's refining and retailing sector attractive enough.
Mittal Investments, which has bought the stake in the refinery being constructed by HPCL in Punjab, is part of a group that includes Arcelor Mittal, the world's leading steel firm. Mittal Investments will be spending $727.7 million on the project. An agreement is expected to be signed next week.
The new refinery at Bhatinda will have a capacity of 180,000 barrels a day, and is scheduled to be commissioned in 2010/11."Mittals have taken a 49% stake, while 2% will be held by financial institutions," Murli Deora said. The petroleum minister added, "HPCL and Mittals are seriously discussing joint exploration of opportunities overseas."
Mittal Investments already has a joint venture with Oil and Natural Gas Corporation (ONGC), India's leading state-run exploration company, to acquire overseas assets.
Indian state-run oil marketing firms are losing millions of rupees every month due to government-imposed price controls on sales of petrol and diesel. Global oil majors have been eyeing India's refining sector as Asia's third-largest oil consumer hopes to become an export hub.
The counter clocked volumes of 1.05 lakh shares on BSE.The stock declined steadily in the past few sessions, following price cuts announced recently, which will affect its profitability. From Rs 323.15 on 22 January 2007, the stock slipped to Rs 273.35 by 15 February 2007 as selling continued. At this level, it found support and started moving higher to reach Rs 281.80 by 19 February 2007.
HPCL recorded a net profit of Rs 407.31 crore for the quarter ended December 2006 compared to a net loss of Rs 1077.75 crore during the quarter ended December 2005. Net sales for the quarter rose 21.50%, to Rs 22,150.20 crore (Rs 18,231.19 crore). The improved performance was due to oil bond receipts.
The market-breadth weakened further. Against 1,884 shares that declined on BSE, 691 rose. Just 56 shares were unchanged. Losers outpaced gainers by a ratio of 2.7:1.At 14:29 IST the Sensex was down 90 points, at 14,313. It had hit a low of 14,279.49 at 14:09 IST. At this low, the barometer index had lost 123.41 points for the day. The Sensex had moved in a narrow range till early-afternoon trade.The BSE clocked a turnover of Rs 2906 crore.
Cement shares had edged lower. Grasim lost 2.6% to Rs 2580, and Gujarat Ambuja Cements shed 1.6% to Rs 130. However, ACC came off the lower level. The ACC stock was flat at Rs 1016.45, off the session’s low of Rs 1002.
Hindustan Lever advances after results
Hindustan Lever rose 1% to Rs 207.25, despite the marginal 1.85% fall in net profit for the December 2006 quarter.The Hindustan Lever (HLL) counter clocked volumes of 20.31 lakh shares on BSE. The stock had gained before the results, from Rs 200.25 on 14 February to Rs 205.10 by 19 February 2007.
The results, a fall in net profit nothwithstanding, are better than expectations.
HLL posted 1.85% fall in net profit to Rs 511.18 crore for the quarter ended December 2006, whereas the same was at Rs 520.86 crore for the quarter ended December 2005. Total income for the December 2006 quarter increased to Rs 3263.05 crore (Rs 3038.53 crore).
For the year ended December 2006, HLL posted a net profit of Rs 1855.37 crore, whereas the same was at Rs 1408.10 crore for the year ended December 2005. Total income increased to Rs 12457.91 crore (Rs 11365.33 crore).
On a consolidated basis, the group posted a net profit (after minority interest) of Rs 1890.53 crore for the year ended December 2006, whereas the same was at Rs 1355.92 crore for the year ended December 2005. Total income rose to Rs 12803.90 crore (Rs 11879.21 crore).
The results for the quarter are not comparable to the extent of amalgamation of Vashisti Detergents with the company, and the demerger and subsequent disposal of Doom Dooma and TEI plantation.
HLL has recommended a payment of Rs 3 per share on face value of Re 1 each by way of final dividend, making a total of Rs 6 per share, for the year ended December 2006.
During the year, continuing sales grew 10% and FMCG sales grew 12.8%. Home and personal care (HPC) sales grew 13.7%, led by double digit growth in laundry, toothpaste and food sales grew by 9%. Exceptional items (net of tax) for the December 2006 quarter comprise profit arising from disposal of 51% share in a subsidiary (Rs 36.74 crore); reduction in liability for retirement benefits arising from impact of revised interest rates and lower annuity costs (Rs 21.89 crore); and restructuring costs in the foods business (Rs 30.88 crore).
The highly competitive laundry category continued to perform well with strong volume-led growth across the portfolio. The Close Up brand led growth in toothpaste. Personal wash growth was led by Lifebuoy, Pears and Lux. Shampoo growth was modest due to a high comparator in the previous year and skin category growth was affected due to a late and short winter. Strong innovations continued during the quarter and included the relaunch of Breeze, Vaseline Body Lotion, Lux Body Wash, Scalp Oil control variant of Clinic All-Clear and Ponds Age Miracle at the top end of the skin-care market.
Foods business grew by 10.9%. In beverages, Taaza was relaunched during the quarter, aiding the growth witnessed in tea. Coffee had another quarter of good growth, led by instant coffee. Strong performances by the Kissan portfolio and Knorr range drove the processed foods growth in this quarter. The ice-cream business continued to show double digit growth led by the impulse category and wider availability.
Earlier this month, Hindustan Lever launched its flagship beauty brand Dove's, a hair-care range in India. Currently, Dove's hair-care products are available in India only through third party imports. Unilever plans to discontinue this route, and market the new Dove shampoos and conditioners through the home and personal care (HPC) division of HLL.
HLL plans to roll out three variants of the shampoo and conditioner combo: essential care, daily care and moisture therapy. Based on the performance of these three variants, HLL will unveil other products from Unilever's international Dove portfolio - which includes hair gel, cream and advanced care.
In the Indian hair-care space, HLL is the leader with 48% market share. Dove's new launch is likely to face competition from P&G's Pantene range, L'Oreal's portfolio and other entrants as well as from domestic players like CavinKare, Marico and others.
The size of the hair-care market in India is Rs 3,800 crore, and is growing at 6% per annum. 'Dove is considered to be one of the most premium brands in the market, but has been a fast growing brand for the company. After introducing the soap at a lower price point, it has seen higher value growth,' said an industry analyst.
HPCL on the move
Hindustan Petroleum Corporation advanced 2.25% to Rs 288.15, after the petroleum minister said the Lakshmi Mittal group had picked up 49% stake in a refinery being built by the company.
The investment comes a year after Bharat Petroleum (BP) pulled out saying the project was not attractive. BP, in March 2006, quit plans to help build the new refinery -- then valued at $3 billion -- as it did not find India's refining and retailing sector attractive enough.
Mittal Investments, which has bought the stake in the refinery being constructed by HPCL in Punjab, is part of a group that includes Arcelor Mittal, the world's leading steel firm. Mittal Investments will be spending $727.7 million on the project. An agreement is expected to be signed next week.
The new refinery at Bhatinda will have a capacity of 180,000 barrels a day, and is scheduled to be commissioned in 2010/11."Mittals have taken a 49% stake, while 2% will be held by financial institutions," Murli Deora said. The petroleum minister added, "HPCL and Mittals are seriously discussing joint exploration of opportunities overseas."
Mittal Investments already has a joint venture with Oil and Natural Gas Corporation (ONGC), India's leading state-run exploration company, to acquire overseas assets.
Indian state-run oil marketing firms are losing millions of rupees every month due to government-imposed price controls on sales of petrol and diesel. Global oil majors have been eyeing India's refining sector as Asia's third-largest oil consumer hopes to become an export hub.
The counter clocked volumes of 1.05 lakh shares on BSE.The stock declined steadily in the past few sessions, following price cuts announced recently, which will affect its profitability. From Rs 323.15 on 22 January 2007, the stock slipped to Rs 273.35 by 15 February 2007 as selling continued. At this level, it found support and started moving higher to reach Rs 281.80 by 19 February 2007.
HPCL recorded a net profit of Rs 407.31 crore for the quarter ended December 2006 compared to a net loss of Rs 1077.75 crore during the quarter ended December 2005. Net sales for the quarter rose 21.50%, to Rs 22,150.20 crore (Rs 18,231.19 crore). The improved performance was due to oil bond receipts.
Labels: Hindustan Lever, HPCL
posted by SY at 3:29 PM
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