Financial Daily from THE HINDU group of publications
Sunday, Oct 20, 2002
Financial Daily from THE HINDU group of publications Sunday, Oct 20, 2002 |
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Investment World
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Stock Markets Markets - Commentary Software stocks in focus Krishnan Thiagarajan
BUOYED by some encouraging earnings performances, the BSE Sensex ended the week on a positive note. The BSE Sensex closed for the week at 3009.76 points, 13.99 per cent higher than the previous week. Clearly, software was the flavour of the week. The large outsourcing deals struck by software majors, swelling first time client visits and robust recruitment have been doing the rounds for some time now and this had kept the offshore outsourcing story in the limelight. And the trigger was provided by the earnings performance of Infosys Technologies. Following a change in the management guidance for 2002-03 and robust volume growth in the Infosys second quarter performance, the software stocks occupied centrestage during the week's trading. This was further fuelled on the expectations of the earnings performance of Wipro on Friday. Wipro's performance (specially of its Global IT Services arm) turned out to be mixed one, with growth on the volume front but continued pressure on its PBIT margins. After marching up through the week, the stock declined marginally on the day following its earnings performance. The other software stocks which announced earnings performance for the week were VisualSoft Technologies, Hexaware and Sonata Software. Among other sectors, the announcement on earnings performance were made by Ranbaxy Labs and Hero Honda and both the stocks shed value during the week. After several weeks, as the stalemate over disinvestment continued without any decisive shifts, the PSU stocks paid the price. Almost all the PSU stocks such as the petroleum majors - HPCL and BPCL, ONGC, MTNL and Nalco. But the event of the week was clearly, the Grasim's open offer for a 20 per cent equity stake in Larsen and Tourbo at an offer price of Rs. 190 per share as it crossed the 15 per cent threshold. Some of the major earnings performance to be made in the following week are VSNL, TVS Motor Company, Tata Power, Hindalco, Indal, Tata Chem, Mico, Bajaj Auto, Satyam, ITC, Dr. Reddy's, Grasim, Ashok Leyland , HLL, MTNL and BSES.
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