The Indian market opened flat to positive mirroring similar opening in SGX Nifty. The US markets moved higher over the course of the trading day on Tuesday, on the back of a positive reaction to the latest earnings news, although buying interest was somewhat subdued. The major European markets ended the day in the red on Tuesday for a third consecutive session after the Bank of Japan disappointed investors hoping for a bolder policy by introducing a 2% inflation target and announced additional easing steps; but investors appeared somewhat disappointed that additional asset buying will not start until 2014. However, the stronger than expected German economic sentiment helped to curb market losses. The Indian markets snapped three days of gains on Tuesday, weighed down by weak European cues as investors waited for key US earnings and housing data for directional cues. Going ahead investors would be watchful of the earnings data coupled with reports on weekly jobless claims, leading economic indicators, and new and existing home sales.
RIL shuts 8th well in KG-D6 basin
Reliance Industries has shut its eighth well on the main gas fields in KG-D6 block, leading to output plummeting to all time low of 20.88 mmscmd. RIL, on January 9, shut the well B6 on the main producing fields of Dhiburbhai-1 and 3 (D1&D3) in Krishna Godavari basin KG-D6 block "due to water loading," according to a status report of the Directorate General of Hydrocarbons (DGH). Previously, on November 29 it had shut B4, the seventh well on D1&D3 field. The latest shutting led to the output slipping from D1&D3 to 16.98 million standard cubic meters per day during the week ended January 13, the report said. Together with 4.37 mmsmcd from MA oilfield in the same block, the output totalled 21.35 mmscmd in the week. However, the production has since plummeted further to 20.88 mmscmd this week, the lowest level since D1&D3 started production in April 2009. The output has fallen from 22.04 mmscmd in December end, when D1&D3 produced 17.66 mmscmd and MA 4.38 mmscmd. RIL has so far drilled 22 wells on D1&D3 fields but has put only 18 on production so far. D1&D3, which started gas production in April 2009, had touched a peak of 55 mmscmd in August 2010 before beginning of water and sand ingress in wells. The same problem has led to shutting of one-third of the wells on MA oilfield in the same block. Output from MA is half of the peak rate it had achieved in 2010. Sources said RIL had last year proposed to do work-over or maintenance job to revive sick or closed wells but the Oil Ministry and DGH are yet to give their go ahead. The USD 100-120 million spending in the work-over is part of the capital Budget for current fiscal which along with the same for 2010-11 and 2011-12 is pending approval. Oil Ministry says it has withheld approvals pending RIL agreeing to give the Comptroller and Auditor General (CAG) access of its books to conduct a second round of audit. The audit has since begun but the approvals haven't come yet. Of the 21.35 mmscmd of cumulative production from January 7 to 13, 14.54 mmscmd was sold to fertiliser plants and 4.02 mmscmd to power plants. The remaining 2.79 mmscmd gas was consumed by other sectors such as LPG and the East-West pipeline which transports fuel from east coast to the west. RIL, the report said, has projected an output of 22 mmscmd in January. RIL has so far made 18 gas and one oil discovery in the Krishna Godavari basin block in Bay of Bengal. While the lone oil find, MA went on stream in September 2008, largest among the gas finds, D1&D3 were put on production in April, 2009.Source: Economic Times
JP Associates to sell 2.78cr shares of Jaypee Infratech
Infrastructure major Jaiprakash Associates today said it will sell over 2.78 crore shares of the group firm, Jaypee Infratech, through auction route on Thursday.At today's closing price of Rs 53.15 of Jaypee Infratech on the BSE, Jaiprakash Associates will raise up to Rs 148 crore, if the offer is fully subscribed."...proposes to sell an aggregate of 2,78,64,584 equity shares of face value of Rs 10 each of Jaypee Infratech Ltd on January 24, 2013...through a sale on the separate window provided by the stock exchanges for this purpose...," the company said in a filing to the BSE.JP Associates has also kept the option of selling up to 70,619,430 additional shares of Jaypee Infratech, it added.The shares sale, which will happen via offer for sale route, will open at 9:15 am and close at 3:30 pm through a special window provided by both, the BSE and the National Stock Exchange, it further said.Source: Financial Express
HUL Q3 net profit lags Street estimates
After riding a crest for much of 2011-12, consumer goods company Hindustan Unilever ( HUL) now appears to be struggling, thanks to lower consumer spending, mainly in discretionary categories. Also, the company has signed a new agreement with parent Unilever Plc under which its royalty payment would rise to 3.15 per cent of sales by March 2018 from 1.4 per cent now. HUL’s volume growth was down to five per cent in the quarter ended December 2012, from 9-10 per cent in the year-ago period. The rise of 16 per cent in net profit to Rs 871 crore was also lower than the Street estimates. The company’s stock sank six per cent late afternoon on BSE on Tuesday before recuperating a little to end the day 2.9 per cent lower at Rs 481.55 a share.The FMCG major’s net sales rose 12 per cent during the quarter to Rs 6,655 crore. Analysts were expecting HUL to post an average net profit of Rs 900 crore on sales of around Rs 6,800 crore. “HUL has delivered a disappointing set of numbers, with the five per cent underlying volume growth for domestic consumer business the lowest in last three years,” said Angel Broking research analyst (FMCG) V Srinivasan. “While the low-margin soaps and detergent division posted a 20 per cent sales growth, the personal products division disappointed with a modest 13 per cent sales growth. We maintain a neutral view on the stock,” he said. HUL Chief Financial Officer R Sridhar, addressing the media at the company’s headquarters in Mumbai, said challenges in the near term would likely persist, especially in categories such as face care, hair care, ice-creams and packaged foods. Source: Business Standard
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