Market Analysis: Review on Friday, Nov 26

Mumbai, Nov 26: Benchmark index Sensex fell 0.7 percent on Thursday, Nov 25 to its lowest close in more than two months as a new corruption scandal rocked the country, hitting shares of banks and other companies allegedly involved in exchanging bribes for large corporate loans.

Benchmark index Sensex lost 141 points and closed at 19,318, while Nifty lost 66 points and closed at 5,799. BSE IT and Teck indices gained 1.2 percent and 0.9 percent respectively. BSE Realty and Capital Goods indices were down by 5.4 percent and 2.9 percent respectively.

Tata Steel eyes more acquisitions

Tata Steel is looking at further acquisitions as it boosts capacity to meet booming demand at home and overseas. Tata Steel has a global capacity of around 30 million tonne, two-third of which are from its European unit, Corus.
The Company is in the process of securing clearances for a nearly five- million tonne integrated steel plant in Vietnam and is also working to boost its capacity in India.

The steel project in the central Vietnamese province of HaTinh will make use of iron ore from a nearby mine, with the first phase expected to be completed in 2-1/2 to three years. Tata Steel is taking 30 percent equity in the mine and 65 percent interest in the steel plant.

In India, capacity is expected to rise to 10 million tonne in the near future from around 7.5 million tonne currently. Tata Steel will also build a 12 million tonne a year steel plant in Jharkhand.

Adani Wilmar eyes acquisitions in UP

Adhani Wilmar, an edible oil maker, is eyeing acquisitions in Uttar Pradesh to expand production capacity. In the past two years, Adani has done 11 acquisitions of crushing and refining units in various oil producing states such as Madhya Pradesh, Maharastra, Rajasthan and Andra Pradesh. This, with expansion of its six existing units, saw it spend Rs.1100 crore on capacity building.

With crushing capacity of close to 7,000 tonne per day, Adani lags arch rival Ruchi Soya, the maker of brands such as Ruchi Gold, Sunrich and Mahakosh.
In refining, however, the two are neck and neck, with a capacity of 10,000 tonne per day. Cargilll, maker of Gemini and Nature Fresh edible oils, is a distant third, with no crushing capacity and a refining capacity below 5,000 tonne per day.

Capgemini acquires Indian IT firm Thesys

Paris Based Information technology (IT) company Capgemini had acquired Indian IT firm Thesys Technologies. Thesys is a Temenos-certified services partner that provides banking implementation solutions to the global financial service industry. The Company has an employee base of 300. This will add to the over 30,000 employee base that Capgemini has in India.

The acquisition expands Capgemini"s global delivery capabilities for Temenos-enabled core banking front-to back-office solutions and product offerings- such as retail, corporate, universal, private wealth management, Islamic banking and micro-finance-to financial institutions, and bolsters its position as a core banking and wealth management service provider.

Purvankara plans 4 projects by 2012

Purvankara Projects is planning to invest around Rs.3,000 crore by 2012 to set up four affordable housing projects in Karnataka and Tamil Nadu. Of these four projects, one will come up on Mysore road in Bangalore by the end of this fiscal and another three projects will be launched in the next financial year.

The Company, presently, is executing an affordable housing project provident Welworth City on the Doddaballapur Road in North Bangalore in the price range of Rs.15-20 lakh per apartment.

The Company plans to launch another project on Mysore road area with an approximate investment of Rs.1,000 crore. The company would not raise any money to fund these projects as fund flow from new bookings would be sufficient to take care of the operating cost.

(An article by DAS CAPITAL MANAGEMENT AND ADVISORS Pvt Ltd)