Banking, telecom lead the gains

The Indian markets gained ground during the previous two hours of trade as buying was witnessed at lower levels. While banking, telecom and engineering stocks are leading the pack of gainers, select pharma and power stocks are trading weak on the bourses currently. The overall advance to decline ratio is poised at 1.9 to 1 on the BSE.
The BSE-Sensex and NSE-Nifty indices are trading firm, up by around 125 points and 30 points respectively. The BSE-Midcap and BSE-Smallcap indices are also trading firm, up by 1.3% each. The rupee is trading at 49.98 to the dollar.
FMCG stocks are trading mixed. GSK consumer is trading firm, while Dabur India is trading weak currently. As per a leading business daily, Dabur India is planning to enter the apple soft drink market during the current month. The present rivals in the category include Coca-Cola’s Fanta Apple and Parle Agro’s Appy. The new launch is a part of Dabur’s plans to enter the non-cola soft drink market, which is reporting a 30% YoY. Dabur hold 52% market share in the packaged fruit juice market, but is not present in the plain beverage segment. With this new launch, the company is hoping to address this big gap in its portfolio and also enter the low-priced beverage market. On account of rising health awareness among the consumers, the juice and juice-drinks market is witnessing strong demand. Currently pegged yearly at Rs 15 bn, the segment earns higher profitability than the carbonated drinks.
Textile stocks are also trading mixed currently. While Bombay Dyeing and Welspun India are trading firm, Raymond is trading in the red. Raymond had announced its 4QFY09 and FY09 results last weekend. The company’s sales grew marginally by 4% YoY during FY09, while the topline declined by 18% YoY during 4QFY09. The company’s full year operating margins have improved by 1.7% YoY to 8.6% due to higher realisations in the worsted fabric business. However, due to higher interest costs and a loss on foreign currency borrowing drained Raymaond’s full year bottomline, which recorded a loss of Rs 2.7 bn compared to profit of Rs 662 m a year earlier. On account of loss during FY09, the company has not declared any dividends, barring record of continuous dividend payments during the earlier years.