Nifty hovers around 8500; Coal India, L&T, Sesa gainers

1:30 pm Result poll: With results for Infosys and TCS out of the way, all eyes will be on the country’s third-largest IT services exporter Wipro when it reports quarterly earnings Friday. A poll of analysts forecasts the firm’s dollar revenues to grow 0.76 percent to USD 1785 million while revenue in rupee terms may rise 1.35 percent to Rs 11,070 crore. Operating profits are seen at Rs 2,431 crore while EBIT margin is seen unchanged at 22 percent. Analysts will also likely watch out for guidance the company gives for the fourth quarter, likely to come in at 1-3 percent or 2-4 percent – crucial because weakness in Wipro’s strongest vertical, energy (17 percent of revenues) may bog down revenue growth.

Don't miss: TCS falls 2%: Why are analysts still bullish post mute Q3?

The market is still flat as the Sensex is up 48.25 points at 28123.80. The Nifty is up 13.90 points at 8508.05. About 1361 shares have advanced, 1341 shares declined, and 313 shares are unchanged.

Coal India, L&T, Sesa Sterlite, M&M and BHEL are top gainers in the Sensex while Bharti Airtel, SBI, Tata Motors, Hero Motocorp and TCS are among the laggards.

Brent futures edged higher holding above USD 48 a barrel on positive technical price momentum, although few analysts expect a strong rebound anytime soon as global output continues to outweigh demand.

Still, crude markets may be bottoming out, analysts said, as prices were receiving support around current levels.

Despite the slight price gains, oil opened up into a wobbly market after Switzerland jolted markets already roiled by plunging commodities prices by abandoning its currency cap on Thursday.   

Datsun Go+: easy on the pocket, but lacks features

NISSAN’S LOW-COST brand Datsun made its global comeback with a lot of hype in India last year. Its first offering — a no-frills small hatchback Go — was supposed to be funky, fuel-efficient and affordable. Something that many budget consumers in India would find appealing. Insufficient sales and service network, uninspiring interiors and a caustic campaign on its safety credentials by global NCAP, however, has resulted in many writing Go’s epitaph within a year of its launch. The brand is now ready with a seven-seater version — Go+. Touted as one of world’s cheapest seven seaters, India could take a liking to it. But will it deliver where Go failed?

EXTERIOR

The Go+ has the same front face, grille and headlamps as the Go. To keep its cost down, the length of the car has been capped at under 4 metres to qualify for concessional excise duties. The major change from the Go is the stretched rear where the extra row of seating comes into play. Beyond the length though there is not much of a change in design with Datsun going along with similar tail lamp cluster. A wraparound design may have spiced things up a bit.

INTERIOR

The Go+ profits from the excellent cabin structure of its small car that squeezed out the most space from a smaller wheelbase. Legroom and headroom at the front two rows is great and the large glass area gives an airy feel to the cabin. Unfortunately, the third row of seat does not work one bit and is cramped all around. Fold that third row and you do get decent 237 litres of boot space. The other drawback is the lack of equipment in the car. While the quality of plastic is decent, fit and finish is below par. There are other glaring omissions like the lid in the glovebox or that the ORVMs cannot be adjusted from the inside. And there is no music system as well even at the top-end trim. And we are not even talking about the safety features.

PERFORMANCE, RIDE AND HANDLING

Go+ does not have a diesel engine and is powered only by a 1.2 litre petrol motor. It develops a measly 68 PS power. The company though has recalibrated the gear ratios given the extra weight and the needs of the vehicle to haul more people and luggage. As a result, the car feels more energetic than what the numbers suggest. It is sluggish and getting to threedigit speeds does take time but it climbs comfortably to city and highway permissible speeds of 80-90 kph. The ride quality is one of the best you can get for a car of this nature and at this price. It tackles bad roads with composure and handles sharp maneuvers reasonably well at high double-digit speeds.

VERDICT

It is clear that Go+ does not wish to compete with the likes of Mobilio or Ertiga. It positions itself as an optional seven seater for the city and more like a station wagon for weekend getaways. Clearly it will not appeal to the rural markets where hauling masses is key. Urban consumers will also be put off by the lack of equipment and safety features. No airbags and ABS even at the top-end trim is again a miss that can prove costly for Datsun. But it is Rs. 2-lakh cheaper than the Ertiga and almost Rs. 3-lakh cheaper than Mobilio. It isn’t a stylish vehicle but does the job of commuting well without pinching your pocket. At over 20 kpl it will be the most fuelefficient petrol wagon/van of its type. This one is for somebody who does not like to spend an extra penny on any frill or extravagance.

Insurance agents, brokers now under same ambit

In the recently promulgated insurance ordinance, the government has brought corporate agents within the definition of ‘’insurance intermediary’’ in line with brokers thereby opening up the debate on whether banks can now act as brokers and seek partnership with multiple insurers.

In the ordinance, approved by the government on December 24 and signed by the President on December 26, the Centre expanded the definition of “intermediary” by bringing corporate agents within its ambit. “Insurance intermediary includes insurance brokers, re-insurance brokers, insurance consultants, corporate agents, third party administrators, surveyors and loss assessors and such other entities as may be notified from time to time by the authority,” said the Insurance Ordinance in its definition of intermediary.

In the earlier definition, corporate agents were not defined as intermediary and the Insurance Act had mandated exclusive distribution arrangement only for agents including corporate agents.

The email and messages sent to the Irda chairman on Monday, asking the impact of the same, went unanswered until late Tuesday.

Former Irda chairman, J Hari Narayan, however, said that an agent is an agent and a broker is a broker, their roles are defined. “Going forward, Irda will have to come out with a regulation with regard to corporate agents and will have to specify their reporting mechanism,” said Hari Narayan.

Within the industry, while some feel that by bringing them under the common head of ‘intermediary’, the government intends banks to also act as brokers and sell products of various insurers in a bid to increase penetration, there are others who feel that they continue to be defined individually as brokers and agents and Irda will have to clarify the same.

A senior official with a private sector insurer said, “By bringing both under the definition of intermediary, the government set the ground for opening up Bancassurance that will allow banks to sell products of multiple insurers. The Irda will now have to come out with a guideline relating to the same. However there are some who do not entirely agree with this and say that they would wait for Irda’s guidelines.”

“We will have to wait for IRDA to define who will act as what. However, the change in ordinance as of now means that while earlier the insurer was answerable for the errors and omissions of corporate agents, now they themselves will be answerable for the same,”said the head of an insurance company who did not wish to be identified.

The CEO of another private sector general insurance company said, “The power now rests with the regulator and Irda will have to come out with a guideline clarifying the scope of brokers, corporate agents and agents.”

In August 2013, Irda had come out with a notification allowing banks to get licensed as insurance brokers making it possible for banks to migrate from a corporate agency structure to broking but despite the enabling regulations, no bank has till date migrated.

Delhi poll battle: Dear BJP, what about Kiran Bedi's own history as a bhagora?

Kiran Bedi’s past is so full of many U-turns, controversies, spats with seniors, courts, lawyers and outbursts against Narendra Modi that an entire issue of Charlie Hebdo could be dedicated to satirizing her career.

Her opinion on Modi, before she inexplicably (or was it part of a political strategy?) changed her mind is well known, courtesy her tweets. Till a few months before Modi became the PM -- a fact that must have inspired Bedi to rearrange her thoughts and realign her political philosophy -- she was continuously attacking him for the Gujarat riots.

In March, Bedi tweeted: "One day NaMo will need to respond with clarity about riots massacre. Despite Courts clearing him so far."

And in April 2012, she has argued that Modi may have passed the SIT exam but was yet to clear the test of ‘prevailing perception of serious incidents’ under his watch.

But, hey, now that the BJP desperately needs somebody to take on Arvind Kejriwal, all such past sins are forgiven.

The public spotlight that comes with an election may be less merciful. Now that she has taken the plunge into politics, Bedi will have to undergo a serious scrutiny of her career, persona and politics. There may not be Charlie Hebdo cartoons, but there will be uncomfortable questions.

Why was Bedi, for instance, bypassed for the post of Delhi’s police commissioner? And why was she not found suitable for a filed posting after being reprimanded by an enquiry committee for ordering a lathi charge on lawyers?

In July 2007, Bedi proceeded on a three-month ‘protest leave’ when she was overlooked for the Delhi commissioner’s post. Bedi claimed she was a victim of gender bias, and declared that she was weighing all ‘options including legal’. She instead suddenly changed her mind, cancelled her leave, resumed office and finally applied for voluntary retirement. The government accepted her application and relieved her immediately.

At the time, many critics challenged her claim that her ‘merit has been compromised’ and she has an ‘outstanding record.’

Writing for the Hindustan Times, Karan Thapar said he had invited Bedi to discuss her grievances on his TV show, but she failed to turn up. So he instead shot a volley of questions at Bedi, some of which were serious, including the grave suspicion that Bedi could not be ‘trusted with classified information and security.’

“To begin with, you've received neither the Indian Police Medal for Meritorious Service nor the President's Police Medal for Distinguished Service. Given that these are routinely awarded after completing a certain number of years of service, isn't your not getting them proof that your record is neither meritorious nor distinguished?

Secondly, is it true that on 4 separate occasions you failed to complete your tenure and at least twice left your post without permission which is tantamount to desertion of duty? (She didn't complete her tenure as Superintendent of Police in Goa, DIG (Range) in Mizoram, Inspector General (Prisons) Tihar Jail and Inspector General of Police in Chandigarh. The posts that she left without permission were Goa, in 1983, and Mizoram, in 1992. Speaking to the Sunday Observer on the 27th September, 1992, she said of Mizoram: "I left without asking". Her letter of 25th January, 1984 to the Inspector General of Police in Goa, Mr Rajendra Mohan, establishes that she left on leave that had not been sanctioned.)

In 1990, Bedi was indicted by an enquiry committee headed by Justice DP Wadhwa for gross irregularities in dealing with a strike by Tis Hazari lawyers in Delhi. In a damning indictment of her role, the committee said the lathi-charge on agitating lawyers ordered by Kiran Bedi, the then deputy commissioner of police (north), a week after the incident was "indiscriminate and unjustified".

Worse, it declared that Bedi had connived with a municipal councilor in organising and transporting a mob to Tiz Hazari who then assaulted the lawyers. Bedi maintained that she was discriminated against during the enquiry. But it was accepted by the home ministry and tabled in the Parliament with an assurance to lawyers that Bedi will never be posted in Delhi in any important position.

Bedi was later sent to Mizoram where her actions stirred up another controversy. People of the state poured into the streets when it was revealed that Bedi had secured her daughter’s admission to an MBBS course in Delhi’s Lady Hardinge College under the Mizoram quota.

Bedi argued that she was within her rights to avail the quota since she was at that time posted in Mizoram. But protesters claimed the purpose of the reservation was to ensure local students get its benefit and Bedi had taken advantage of a loophole in the law. When Mizoram became too hot to handle, Bedi once again left. Incidentally, her daughter also dropped out of the course later.

Incomplete tenures, unauthorised leaves and lots of flip-flops. And let’s not forget the words Thapar used to describe her actions while in the police of force: “desertion of duty”.

The Delhi elections is now a battle of the bhagoras. Voters will have to decide whose dereliction of duty matter more: Arivnd Kejriwal’s 49-day tenure or Kiran Bedi’s many hasty exits.

Sensex holds 28000 amid pressure; Sun TV, SpiceJet in focus

10:30am Piramal Enterprises in News

Piramal Enterprises (PEL) gained 2 percent today as the Piramal Group company has been considering the acquisition of UK-based company.

"Piramal Enterprises is in final stages of discussion with the University of Kentucky for the potential acquisition of Coldstream Laboratories for a total consideration of USD 30.65 million," said the company in its filing to the exchange.

Of the total amount, USD 5.65 million would be towards the Coldstream facility on the Research Park Campus of the University, while the rest would be towards purchase of the company’s shares, it added.

This potential transaction is subject to corporate approvals and is expected to be completed by the end of this week. However, the transaction is not subject to any regulatory approvals. No related party of PEL has any interest in Coldstream, said the Piramal Group company.

10:00am Market Check

Equity benchmarks entered into consolidation mode after the yesterday's rally priced in all events like surprise rate cut by RBI, fall in trade deficit etc. The frontline indices were marginally in red on profit booking.

The Sensex fell 42.23 points to 28033.32 and the Nifty declined 12.15 points to 8482. However, the broader markets outperformed benchmarks marginally with the BSE Midcap and Smallcap indices rising 0.2-0.5 percent.

About 1073 shares have advanced, 786 shares declined, and 276 shares are unchanged on the Bombay Stock Exchange.

“With sharply lower commodity prices, favourable macro indicators like inflation, CAD & fiscal deficit and now rate cuts, we believe conditions are ripe for economic recovery to take shape,” says Rakesh Arora, Macquarie.

According to him, the government sustaining its policy momentum and delivering on reforms would be key. “Markets will closely watch the upcoming Budget session in late February.  In our view, any market weakness should be seen as an opportunity to buy,” says Arora.

TCS fell nearly 2 percent on reporting lackluster results. Dollar revenue growth was flat and constant currency growth at 2.5 percent was lower than that of Infosys. CLSA lowered FY16/17 earnings per share by 2/3 percent due to deeper cross-currencies and lower than expected revenue acceleration and cut target price to Rs 3100/share.

Bharti Airtel dropped nearly 3 percent. Media report suggested that Bharti Airtel, Idea Cellular, Reliance Communications and Vodafone may collectively bid Rs 74,000 crore as per HSBC report.

Shares of ICICI Bank, SBI, ITC, Bharti Airtel, Tata Motors, Tata Steel, Maruti Suzuki, Hero Motocorp and GAIL fell 0.6-1.3 percent while HDFC Bank, HUL, Cipla, Coal India and Sesa Sterlite bucked the trend, up 1.5-2 percent.

Shares of SpiceJet jumped 10 percent as investors queued up for buying shares of the low-cost carrier after Ajay Singh decided to take complete control of the company which has been struggling with financial problems. Sun TV Network gained 9 percent as brokerages believe the SpiceJet deal removed a major overhang on the stock.

Sensex ends down, Nifty below 8300; HUL soars 5%, ITC falls

03:30 pm Market close

After a wild swing, the market ended lower. The Sensex ended down 78.91 points at 27346.82 and the Nifty slipped 21.85 points at 8277.55. About 1262 shares have advanced, 1602 shares declined, and 342 shares were unchanged.

HUL was up 5 percent while, BHEL, Infosys, Bajaj Auto and Maruti were top gainers in the Sensex. Among the losers were Sesa Sterlite, Hindalco, Tata Steel and ITC.

03:10 pm Infosys Sikka's fund for India

Infosys CEO Vishal Sikka today met Prime Minister Narendra Modi and disclosed that his company will spend USD 250 million (over Rs 1,500 crore) to fund innovations in software and services in India. The chief of India's second largest IT services firm also discussed with Modi ways in which the company can participate in the Prime Minister's vision of smart and digitally empowered India. Infosys will develop software for managing the kumbh mela scheduled in Ujjain (Madhya Pradesh) in 2016, he told PTI in an interview.

Sikka, the first non-founder CEO of Infosys, said Modi has agreed to dedicate the company's Mysore campus as the first model smart city in the country in April this year. "Today, I had a meeting with the Prime Minister. We had a talk on smart cities, smart infrastructure, which is close to his heart. And the other big area is innovation. PM has a vision for innovation. As announced last week, we have a USD 500 million Innovation Fund," he said.

02:50pm Market Update

The market slipped again in late trade. The Sensex lost 158.86 points to 27266.87 and the Nifty fell 45.75 points to 8253.65. Metals extended losses; Sesa Sterlite tanked 7.5 percent and Hindalco Industries plunged 7 percent. Tata Steel shed nearly 4 percent and ITC lost 3.5 percent.

About 1143 shares have advanced, 1649 shares declined, and 325 shares are unchanged on the BSE.

02:30pm Tata Teleservices in focus

The Reserve Bank of India has allowed conglomerate Tata Sons Ltd to buy Japanese telecom firm NTT DoCoMo Inc's stake in their struggling Indian venture, paving the way for the completion of the long-delayed USD 1.1 billion deal.

In a memo to the finance ministry dated December 22 seen by Reuters, the Reserve Bank of India (RBI) said it was "inclined to accept" the proposal from Tata to buy DoCoMo's stake of around 26 percent in Tata Teleservices Ltd at half the price DoCoMo originally paid for the investment. The RBI has requested for the finance ministry's view.

The RBI approval, also confirmed by a source directly involved in the process, is part of the government's bid to simplify and scrap some of the more obscure rules that have curbed foreign investment.

A rule change brought in last year prevented foreign investors from selling stakes in Indian firms at a pre-determined price.

"The larger issue here is of a fair commitment in the contracts in relation to an investment and a downside protection of an investment, rather than assured return," the central bank said in the memo.

"Besides, our strategic relationship with Japan in recent times in relation to FDI (foreign direct investment) flows is also a matter to be kept in view," it said.

DoCoMo said in July last year that it would sell its stake in Tata Teleservices. The seventh-biggest mobile phone carrier in India has been losing money in a hugely crowded market for years.

02:00pm Market Check

Equity benchmarks recouped losses. The Sensex fell 34.83 points to 27390.90 and the Nifty declined 18.95 points to 8280.45. About 1165 shares have advanced, 1542 shares declined, and 348 shares are unchanged on the BSE.

Shares of Infosys, HUL, ONGC and BHEL topped the buying list on Sensex, up 1-3 percent. Bajaj Auto gained 1.5 percent ahead of third quarter earnings, which is scheduled to be announced on Thursday. The two-wheeler maker's third quarter profit is expected to fall 6 percent Y-o-Y to Rs 850 crore for the quarter ended December 2014, according poll. Profit in the year-ago quarter was Rs 904 crore.

However, Hindalco Industries and Sesa Sterlite tanked 6 percent each followed by Tata Steel and ITC with 3 percent loss. Reliance Industries, ICICI Bank, Sun Pharma and Wipro fell over 1 percent.