Stock Market Updates For the Week ( March 10th to March 14th, 2014 )…

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Top Corporate News during the week

As per media reports, power tariff likely to go up in Delhi, as power regulator works out plan to liquidate past dues – Positive inshort term for Tata Power and Reliance Infra

As per media reports, Delhi Electricity Regulatory Commission (DERC) has allowed distribution companies (discoms) to recover dues fromthe years when retail tariff increase was disallowed – referred to as regulatory assets (RAs). The regulator has worked out a plan to allowthe Delhi’s 3 private discoms recovery of dues totalling Rs 80bn over eight years beginning 2014-15. As part of this, the discoms willrecover Rs 16.7 bn of RAs from consumers through tariff in the first year.

The overall scheme is to liquidate the Rs 114.3 bn of RAs – recognized but unrecovered revenues – as on March 2012. The move will help the discoms raise additional financial resources from banksbut also increase consumers’ tariff burden. The annual installments allowed to be liquidated are Rs 4.2 bn for BSES Yamuna Pvt Ltd(BYPL), Rs 7.7 bn for BSES RajdhaniPvt Ltd (BRPL) and Rs 4.8 bn for Tata Power Delhi Distribution Ltd (TPDDL). This development ispositive in short term for Tata Power and Reliance Infra.

India’s Feb trade deficit narrows to $8.1 bn – Fall in export raises red flag and India likely to miss export target for FY14;Narrowing deficit continues to give comfort on CAD numbers

India’s trade deficit narrowed in February on a sharp fall in imports, which would further ease pressure on the country’s current accountbalance. The trade deficit stood at $8.13 billion, more than 40% lower from a year ago. Imports continued to fall, driven by a decline in oilimport bill and curbs on gold, the country’s second-most expensive overseas purchase after oil.

Merchandise exports fell 3.67% from ayear earlier to $25.69 billion, compared with 3.8% growth in January. Imports fell 17.09% year-on-year to $33.82 billion. The fall in exportraises red flag and India is likely to miss export target for FY14. However, narrowing deficit continues to give comfort on CAD numbers.

India’s Feb trade deficit narrows to $8.1 bn – Fall in export raises red flag and India likely to miss export target for FY14;Narrowing deficit continues to give comfort on CAD numbers

India’s trade deficit narrowed in February on a sharp fall in imports, which would further ease pressure on the country’s current accountbalance. The trade deficit stood at $8.13 billion, more than 40% lower from a year ago. Imports continued to fall, driven by a decline in oilimport bill and curbs on gold, the country’s second-most expensive overseas purchase after oil. Merchandise exports fell 3.67% from ayear earlier to $25.69 billion, compared with 3.8% growth in January. Imports fell 17.09% year-on-year to $33.82 billion. The fall in exportraises red flag and India is likely to miss export target for FY14. However, narrowing deficit continues to give comfort on CAD numbers.

Tata Motors-owned Jaguar Land Rover global sales up 14% in February 2014 – Positive in short term for Tata Motors and TataMotors DVR

Tata Motors-owned Jaguar Land Rover (JLR) reported a 14% increase in global sales in February at 30,487 units. The company’s saleswere up 44% in the China region, 12% in North America, 16% in Asia Pacific and 1% in Europe. In February, the company sold 5,300Jaguar vehicles, up 15%, while Land Rover sales rose 13% to 25,187 units. In total, JLR retail sales were 30487 units, up 14% YoY. Thecompany has posted robust growth in JLR sales number and the stock is likely to react positively in short term.

Economy & Other News Domestic

India’s IIP turns positive in Jan as mining, power sectoroutput improves

Factory output grew for the first time in 4 months in January onthe back of higher power generation and better production bythe mining sector. The IIP rose 0.1% in Jan14 after contractingfor three consecutive months. It had recorded 2.5% growth inJanuary 2013. However, manufacturing, which constitutes over75% of the index, continued to be a picture of worry, contracting0.7% in January against a growth of 2.7% in the same monthlast year. Also, for December, the contraction in IIP has beenrevised to 0.2% from 0.6%. For April-January, factory outputremained flat compared with 1% growth in the correspondingyear-ago period.

India’s CPI cools-off to 8.1%, below the concensusestimates of 8.3%

Consumer Price Index-based inflation has reduced to 8.1% inFebruary against the concensus estimate of 8.3%. The inflationnumber was 8.79% for the month of Jan14.

World News

Japan Q4 GDP adds 0.2% On Quarter

Japan’s GDP expanded just 0.2% on quarter in the fourth quarterof 2013, growing for the fourth straight quarter. The headline figurewas in line with forecasts, although it was down from last month’spreliminary reading for 0.3% – which was unchanged from the thirdquarter. On an annualized basis, GDP expanded 0.7% – shy offorecasts for 0.9% and down from 1.0% in the preliminary report.GDP was up 1.1% on year in Q3.

China posted $23 bn trade deficit

China posted a $23 billion trade deficit. Exports fell 18.1% inFebruary, surprising analysts that expected a 6.8% rise in exportsand a trade surplus of $14.5 billion.

Eurozone January Industrial Output Falls Unexpectedly

Eurozone industrial production declined unexpectedly in Januarydue to the ongoing contraction in energy output, reflecting thefragile nature of the economic recovery. Industrial output fell 0.2%MoM in January, which was the second consecutive drop.

Economists had expected production to expand 0.5%, after arevised 0.4% fall in December.

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