Stock Market Updates For April 21st, 2014 …


Corporate / Results Corner.

Reliance Industries(RIL) posts good Q4 numbers; Positive for RIL in short to medium term.

RIL Q4 PAT grew by 2.3% QoQ to Rs.56.3bn above street estimates while its sales were down 7.6% QoQ to Rs.951.9bn slightly lower than street estimates.The Gross Refining Margins (GRMs) came in at $9.3/bbl versus $7.6/bblQoQ. The Q4 refining margins stood at 4.5% versus 3.3% QoQ. The Oil & Gas margins were reported at 26.7% versus 31.2% QoQ. RIL’s retail business has turned around and reported a cash profit of Rs 3.6bn. RIL’s shale gas business in the US continued to grow in 2013-14, with revenue jumping 45% to $893.3 million and EBITDA rose by 37 % to $659.4 million. Overall the company has posted good set of results and the management commentary f or FY15 was very positive. The stock is likely to be positive in the short to medium term.

Economic and Other News

India cuts exposure to US treasury securities by $1.1bn

India reduced its exposure to US treasury securities in February along with other BRICS economies due to a slowdown in portfolio investment resulting in lower surpluses in these economies. India cut its exposure in US treasury bonds by 1.6%, or $1.1bn in February to $67bn. While China, Brazil, Russia and South Africa too trimmed their exposure in the US government bonds, the overall foreign investments in these bonds rose 0.77% to $5.9tn during the month.

Govt to continue Rs 3,300 per tn sugar export subsidy to stay

Government has decided to continue with the export subsidy of Rs 3,300 per ton on raw sugar shipments for the April-May period. During February-end, the Cabinet Committee on Economic Affairs (CCEA) had approved an incentive for export of four million tons of raw sugar for two years in order to help the cash-starved industry to pay arrears to sugarcane farmers. CCEA had also decided to review the subsidy amount every two months depending on the rupee-dollar exchange rate.

World News

Japan logs record $134bn trade deficit in FY 2013

Japan’s trade deficit surged nearly 70% to a record 13.75tn yen ($134bn) in the last fiscal year as exports failed to keep pace with surging costs for imported oil and gas. The exports in the year that ended March 31 rose 10.8% over the year before to 70.8tn yen ($690.5bn) while imports climbed 17.3% to 84.6tn yen ($825bn). Japan’s costs for imports of energy have soared since the March 2011 disaster at the Fukushima Dai-Ichi Nuclear Plant led to the closures of all of its nuclear reactors for safety checks.

China firm plans $1bn distressed asset fund for foreigners

A unit of one of China’s biggest bad-debt banks plans to woo foreign investors with a $1bn fund for soured property loans and distressed real-estate assets, reopening the sector to outsiders after a failed attempt last decade. That the fund is being launched just as growth in the world’s second-largest economy has slowed to an 18-month low and the housing market is losing strength is no coincidence.

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