IT stocks brave the storm
IT stocks managed to buck the broader weakness, and recovered from Wednesday(28 February 2007)’s meltdown, under the reckoning that their earnings will be impacted only to a small extent following an increase in their tax burden. The BSE IT index was up 2.69%, and was the top gainer, among the BSE sectoral indices.
Hindalco Ind trips on plan for preferential allotment
Hindalco Industries slipped 3.04% to Rs 135.40, scheduling a board meeting on 2 March 2007 to consider a preferential issue of securities.As many as 8.91 lakh shares were traded in the counter on BSE.The Hindalco Industries (Hindalco) stock has slipped drastically since the beginning of February 2007. From Rs 183 on 2 February, it dropped to Rs 139.65 by 28 February 2007.
At the current market price of Rs 135.40, Hindalco Industries trades at 5.48 times its Q3 December 2006 annualized EPS of Rs 24.70
In February 2007, Hindalco Industries announced the acquisition of Novelis in an all-cash transaction, which values the beleagured US firm at approximately $6 billion, including approximately $2.4 billion in debt.
Novelis is the largest flat rolled products player in the world with a 19% share of the global market. Following the transaction, Hindalco, with Novelis, will be the world's largest aluminum rolling company, one of the biggest producers of primary aluminum in Asia, in addition to being India's leading copper producer.
The Novelis deal will be financed through a recourse debt of $2.8 billion. Hindalco’s treasury will contribute $450 million, while SL Iron Ore Mining, another group company, will contribute $300 million as debt.
Novelis posted a net loss of $102 million during the third quarter of 2006. The company has been plagued by higher metal prices.
Hindalco Industries had also entered into a joint venture with Almex, US, for manufacturing high strength aluminium alloys for aerospace, sporting goods and surface transport applications. Almex, headquartered in Los Angeles, is a technology supplier and equipment manufacturing company. The joint venture, to be named Hindalco - Almex Aerospace, will see 70% equity participation in the joint venture from the company.
In September 2006, Hindalco Industries had proposed a sector specific special economic zone (SEZ) in Madhya Pradesh, which is expected to attract an investment of Rs 20,000 crore. Hindalco will itself contribute Rs 18,000 crore, while the rest will be collected by way of downstream projects. The project is also expected to generate more than 10,000 jobs.
Hindalco had also proposed an aluminium smelter plant and a captive power plant in Sidhi, in a phased manner. The SEZ will cover an area of 2,025 hectares, and will have a processing area of 1,200 hectares.
Hindalco posted a net profit growth of 92% to Rs 643.90 crore (Rs 336.20 crore) in Q3 December 2006. Net sales during the December 2006 quarter rose 62% to Rs 4656.20 crore from Rs 2872.70 crore in the year ago quarter.
Imposition of export duty wrecks Sesa Goa
Sesa Goa plunged 8% to Rs 1636, hit by reports that the Rs 300 export duty on iron ore will become effective immediately.A strong 1.7 lakh shares changed hands in the counter on BSE.
The Sesa Goa stock had lost 8.4% on Wednesday (28 February) after the government imposed a duty of Rs 300 per tonne on export of iron ore in the Budget. This will raise the tax burden for Sesa Goa, which exports ore heavily. Sesa Goa's annual exports amount to around 5 million tonnes out of Marmagao, Chennai and Paradip port. It supplies iron ore to China, Japan and Europe, and is also the sole supplier of iron ore to Pakistan Steel Mill, the only steel manufacturing unit in that country.
The Indian steel and sponge iron industries have been strongly lobbying for restricting iron ore exports, not only to conserve the ore for India’s domestic needs, but also to reduce high prices of domestic ore (particularly the small sponge iron producers). The government’s decision to levy export duty is, however, may not impact local iron ore prices.
The Sesa Goa scrip had spurted over the past few months on hopes of aggressive bidding for Japanese Mitsui's 51% stake in the company, which it has put on the block. From Rs 1186.35 on 20 December 2006, Sesa Goa spurted to Rs 1947.85 by 27 February 2007.
As per reports in a section of the media, Brazilian miner CVRD, steel maker Arcelor Mittal, Vedanta Resources and Aditya Birla group have been shortlisted for the final round of bidding for Mitsui's stake. The four companies were shortlisted from six, who submitted their bids on 19 February 2007. They will be allowed to visit plants of the Sesa Goa in the second week of March before submitting final bids by the end of March, a newspaper report said on Wednesday.
The successful bidder will also have to make an open offer to Sesa Goa shareholders to buy a further 20% stake.
Sesa Goa reported a net profit growth of 23% to Rs 194.94 crore for Q3 December 2006 versus Rs 157.85 crore in Q3 December 2005. Net sales for the December quarter rose 15% to Rs 587.89 crore (Rs 510.37 crore).
Hindalco Ind trips on plan for preferential allotment
Hindalco Industries slipped 3.04% to Rs 135.40, scheduling a board meeting on 2 March 2007 to consider a preferential issue of securities.As many as 8.91 lakh shares were traded in the counter on BSE.The Hindalco Industries (Hindalco) stock has slipped drastically since the beginning of February 2007. From Rs 183 on 2 February, it dropped to Rs 139.65 by 28 February 2007.
At the current market price of Rs 135.40, Hindalco Industries trades at 5.48 times its Q3 December 2006 annualized EPS of Rs 24.70
In February 2007, Hindalco Industries announced the acquisition of Novelis in an all-cash transaction, which values the beleagured US firm at approximately $6 billion, including approximately $2.4 billion in debt.
Novelis is the largest flat rolled products player in the world with a 19% share of the global market. Following the transaction, Hindalco, with Novelis, will be the world's largest aluminum rolling company, one of the biggest producers of primary aluminum in Asia, in addition to being India's leading copper producer.
The Novelis deal will be financed through a recourse debt of $2.8 billion. Hindalco’s treasury will contribute $450 million, while SL Iron Ore Mining, another group company, will contribute $300 million as debt.
Novelis posted a net loss of $102 million during the third quarter of 2006. The company has been plagued by higher metal prices.
Hindalco Industries had also entered into a joint venture with Almex, US, for manufacturing high strength aluminium alloys for aerospace, sporting goods and surface transport applications. Almex, headquartered in Los Angeles, is a technology supplier and equipment manufacturing company. The joint venture, to be named Hindalco - Almex Aerospace, will see 70% equity participation in the joint venture from the company.
In September 2006, Hindalco Industries had proposed a sector specific special economic zone (SEZ) in Madhya Pradesh, which is expected to attract an investment of Rs 20,000 crore. Hindalco will itself contribute Rs 18,000 crore, while the rest will be collected by way of downstream projects. The project is also expected to generate more than 10,000 jobs.
Hindalco had also proposed an aluminium smelter plant and a captive power plant in Sidhi, in a phased manner. The SEZ will cover an area of 2,025 hectares, and will have a processing area of 1,200 hectares.
Hindalco posted a net profit growth of 92% to Rs 643.90 crore (Rs 336.20 crore) in Q3 December 2006. Net sales during the December 2006 quarter rose 62% to Rs 4656.20 crore from Rs 2872.70 crore in the year ago quarter.
Imposition of export duty wrecks Sesa Goa
Sesa Goa plunged 8% to Rs 1636, hit by reports that the Rs 300 export duty on iron ore will become effective immediately.A strong 1.7 lakh shares changed hands in the counter on BSE.
The Sesa Goa stock had lost 8.4% on Wednesday (28 February) after the government imposed a duty of Rs 300 per tonne on export of iron ore in the Budget. This will raise the tax burden for Sesa Goa, which exports ore heavily. Sesa Goa's annual exports amount to around 5 million tonnes out of Marmagao, Chennai and Paradip port. It supplies iron ore to China, Japan and Europe, and is also the sole supplier of iron ore to Pakistan Steel Mill, the only steel manufacturing unit in that country.
The Indian steel and sponge iron industries have been strongly lobbying for restricting iron ore exports, not only to conserve the ore for India’s domestic needs, but also to reduce high prices of domestic ore (particularly the small sponge iron producers). The government’s decision to levy export duty is, however, may not impact local iron ore prices.
The Sesa Goa scrip had spurted over the past few months on hopes of aggressive bidding for Japanese Mitsui's 51% stake in the company, which it has put on the block. From Rs 1186.35 on 20 December 2006, Sesa Goa spurted to Rs 1947.85 by 27 February 2007.
As per reports in a section of the media, Brazilian miner CVRD, steel maker Arcelor Mittal, Vedanta Resources and Aditya Birla group have been shortlisted for the final round of bidding for Mitsui's stake. The four companies were shortlisted from six, who submitted their bids on 19 February 2007. They will be allowed to visit plants of the Sesa Goa in the second week of March before submitting final bids by the end of March, a newspaper report said on Wednesday.
The successful bidder will also have to make an open offer to Sesa Goa shareholders to buy a further 20% stake.
Sesa Goa reported a net profit growth of 23% to Rs 194.94 crore for Q3 December 2006 versus Rs 157.85 crore in Q3 December 2005. Net sales for the December quarter rose 15% to Rs 587.89 crore (Rs 510.37 crore).
Labels: Hindalco preferential issue, Sesa Goa
posted by SY at 2:15 PM
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