MUMBAI: A growing number of companies have been opting for a buyback of shares to support the price in the current phase of market volatility. While the trend is mostly evident among small- and medium-sized companies, the market also expects large-sized companies to join the buyback bandwagon, after FMCG major Hindustan Unilever (HUL) announced a similar move last week.
Apart from HUL, a few other companies such as Geodesic, Manaksia, FDC, Binani Cement, Jindal Poly, ARO Granite and Bright Brothers have either announced or are planning to consider share buyback. Analysts expect more companies to follow this route due to several advantages.
According to Angel Broking CMD Dinesh Thakkar, many companies may want to buyback their shares, but shareholders’ response remains a major concern. “Many companies are quoting much below intrinsic value of their shares and so any buyback offer at the current levels may not receive good response from the shareholders. They will not be able to realise true value from selling shares,” said Mr Thakkar.
Last week HUL said that it would consider buying back the shares from the market, at its board meeting on June 11. Buyback of shares helps raise promoters’ stake using company funds and the reduced equity base improves its earnings-per-share (EPS) in the subsequent years. All these factors keep shareholders confidence high in the company. However, many companies, in the past, could not purchase even a single share, as the market price rose beyond the maximum buyback price soon after they started the buyback.
For instance, Delhi-based Apollo Tyres had planned to buy back equity shares worth Rs 122 crore from the open market at a maximum price of Rs 25 a piece. However, it could not buy back any shares, because of the spurt in the market price immediately after the commencement of the buyback programme.
Other larger companies that have closed their buyback in the past few months include Provogue and Merck, among others. Provogue, which had announced Rs 50-crore buyback, utilised almost 25% of the offer buying close to 20 lakh shares. Merck, which came out with a Rs 45-crore offer, utilised almost 23% of the buyback limit or bought close to 2.6 lakh shares.
When a company buys back shares, it sends out a signal that the company has enough surplus cash to pay back to its shareholders at what it thinks is the true worth of the shares. There were many companies that had announced buyback last year, after share prices crashed more than 80% in most cases.
However, many stocks rose above the buyback price with a sharp recovery in the market, resulting in many companies discontinuing or deferring their plans.
Analysts say that a buyback does not result in much of the benefits for investors despite the offers being at a premium to the prevailing market price. For instance, in the case of Geodesic and Manaksia, the current market price is way below the maximum buyback price. Geodesic is trading at Rs 101, while the company has announced its maximum buyback price of Rs 150. Similarly, Manaksia is currently trading at Rs 110, while maximum buyback price at Rs 200.
The market has so far not taken the buyback offer very seriously, as the stock price continues to trade at a significant discount to the maximum buyback price. The end date for both of them is almost one year from hereon.
Showing posts with label stock market. Show all posts
Showing posts with label stock market. Show all posts
Tuesday, June 8, 2010
Wednesday, April 21, 2010
20 top performing stocks of 2009
Thou the world has seen recession like never before and stock market dipping too low with more than 300 banks losing money in USA alone, there are still stocks that amazed its shareholders by giving them surprising returns. Here's the list of 20 top performing stocks which fortune 500 has listed. Hope they will keep this steady.
20 top-performing stocks
20 top-performing stocks
Tuesday, October 13, 2009
40% of Sensex cos give over 100% returns
Stock prices of close to half of the companies that are part of the Sensex more than doubled in the first half of the financial year (April 1-September 30, 2009). All these companies outperformed the Sensex which gained 78% during the same period.
As per an ETIG study, 40% of the Sensex companies generated returns of 100% or more in the first half of the current fiscal. The top five performers among the Sensex pack include automotive giant Tata Motors (228%), diversified infrastructure firm Jaiprakash Associates (182%), country’s largest private sector bank ICICI Bank (172%), India’s largest real estate firm DLF (162%) and engineering and construction major Larsen & Toubro (150%).
Share price of other companies such as Tata Steel, Hindalco Industries, Wipro, Reliance Infrastructure, Mahindra & Mahindra, Maruti Suzuki and Sterlite Industries (India) also doubled during the same period.
Expectations of better corporate performance led to sharp uptick in stock market valuations since March. This triggered huge money inflow from foreign institutional investors (FII), besides domestic investors returning to the stock market.
Says Amitabh Chakraborty, president (equity) at Religare Capital, “The market is likely to remain volatile in the coming months due to events like announcement of credit policy and corporate results. Further, for the next year, consumption pattern in the US, which is going to become clear in December , is likely to define market trend for the next year.”
Amongst sectors, infrastructure, steel and automobiles have outperformed the Sensex. Although ICICI Bank was among the major gainers, overall banking and FMCG scrips underperformed in the market rally over the last six months.
Says Sarabjit Kour Nangra, VP-research, Angel Commodities, “The outperformance of the automobiles sector is due to better numbers posted by these companies in terms of sales. Moreover, increasing thrust on infrastructure, led to reasonable rally in the infrastructure space as well.” She added the stock market is unlikely to witness correction in the near term, but can see consolidation.
As per an ETIG study, 40% of the Sensex companies generated returns of 100% or more in the first half of the current fiscal. The top five performers among the Sensex pack include automotive giant Tata Motors (228%), diversified infrastructure firm Jaiprakash Associates (182%), country’s largest private sector bank ICICI Bank (172%), India’s largest real estate firm DLF (162%) and engineering and construction major Larsen & Toubro (150%).
Share price of other companies such as Tata Steel, Hindalco Industries, Wipro, Reliance Infrastructure, Mahindra & Mahindra, Maruti Suzuki and Sterlite Industries (India) also doubled during the same period.
Expectations of better corporate performance led to sharp uptick in stock market valuations since March. This triggered huge money inflow from foreign institutional investors (FII), besides domestic investors returning to the stock market.
Says Amitabh Chakraborty, president (equity) at Religare Capital, “The market is likely to remain volatile in the coming months due to events like announcement of credit policy and corporate results. Further, for the next year, consumption pattern in the US, which is going to become clear in December , is likely to define market trend for the next year.”
Amongst sectors, infrastructure, steel and automobiles have outperformed the Sensex. Although ICICI Bank was among the major gainers, overall banking and FMCG scrips underperformed in the market rally over the last six months.
Says Sarabjit Kour Nangra, VP-research, Angel Commodities, “The outperformance of the automobiles sector is due to better numbers posted by these companies in terms of sales. Moreover, increasing thrust on infrastructure, led to reasonable rally in the infrastructure space as well.” She added the stock market is unlikely to witness correction in the near term, but can see consolidation.
Saturday, May 23, 2009
Sensex jumps 14.1% on week; best in 17 years
MUMBAI: The BSE Sensex rose 1.1 per cent on Friday and took gains for the week to 14.1 per cent, its most in 17 years, buoyed by hopes for pro-market reforms after the ruling coalition won general election last weekend.
Manmohan Singh was sworn in as the prime minister for a second term, along with his new cabinet and the outlook for the market would depend on how quickly they are able to push asset sales in state firms, ease rules for foreign investment and boost sagging growth.
Some analysts believe the market is overbought after it leapt more than 17 per cent at the start of the week following the unexpectedly easy election win. The BSE index has risen 73 per cent from a 2009 low in early March and has climbed for 11 weeks in a row in the longest winning streak in four years.
"Valuations have become high, but people are buying because they may be left out otherwise," D.D. Sharma, vice president at Anand Rathi Securities, said.
The BSE index ended up 150.61 points at 13,887.15, with gainers and losers evenly matched. Trading was choppy with the index falling 0.9 per cent at one stage.
Brokerages and investment houses polled by Reuters expected the benchmark to reach 15,750 by the end of December, gaining another 13 per cent.
"There are so many desperate buyers because nobody is betting on the market going down. You will see people buying at every dip from now," Sharma said.
Energy giant Reliance Industries, private-sector lender ICICI Bank and infrastructure firm Larsen & Toubro led the market higher after a lower start.
Reliance, which has the biggest weight in the main index, rose 3.1 per cent to 2,183.10 rupees, while private-sector lender ICICI gained 4.5 per cent to 702.80 rupees.
Larsen & Toubro climbed 4.7 per cent to 1,301.40 rupeesThe market has largely been powered by foreign funds, which have pumped about $5 billion into the market in the past two months, including more than $1 billion in this week.
Outsourcers Tata Consultancy and Wipro, which get most of their revenue from overseas, fell about 2 per cent as the rupee climbed past 47 to a dollar to its highest since December.
Asian shares eased after a drop on Wall Street overnight on fears the United States, with its increasing budget deficit and weakened economy could lose its AAA rating.
Japan's Nikkei dropped 0.4 per cent, while MSCI's measure of other Asian markets edged down 0.02 per cent.
European shares were higher after falling more than 2 per cent in the previous session. The FTSEurofirst 300 index of top European shares was up 0.4 per cent at 1117 GMT.
Tuesday, May 19, 2009
Investors reap Rs 10,000 cr every second in today's trade
MUMBAI: Turning stock market into a money- making machine, the investors added well in excess of Rs 10,000 crore in every second of trade today--a frenzy they must have wished continued beyond just a minute.
However, the hopes are still not dashed completely as Dalal Street is pinning on another spectacular performance tomorrow with an eye on 15,000-points milestone for Sensex, even if it does not match today's historic gain of 2,111 points.
During 60 seconds of trade today -- first for 30 seconds at the opening and then another 30 seconds after trade resumed at 1155 hours -- investors' wealth measured in terms of total market capitalisation of all the listed companies grew by about Rs 6,50,000 crore. This is the biggest ever gain in the history of stock market, not only in India, but possibly in the entire world.
This sharp surge, the best ever post-polls performance of stock market in India, comes in sharp contrast to a huge loss suffered after the last general elections in 2004.
Election results had been announced during trading hours on May 13, 2004 and Sensex had ended up 0.8 per cent after highly volatile trade, but lost over 300 points the next day. In following trading session on May 17, 2004 Sensex plunged 11.1 per cent, its biggest drop in 12 years.
The Sensex had lost over 894 points in the two days after the election results were out in May 2004.
Meanwhile, today the total investors' wealth, measured in terms of combined market-cap of all the listed companies, has increased by over Rs 6,56,477 crore in a minute -- in the first 30 seconds and then after resumption trading in the afternoon -- to Rs 44,63,420.97 crore.
The 30-share Bombay Stock Exchange Sensex zoomed 1,305.97 points at 13,479.39, hitting the upper circuit with seconds of opening of trade, following which trading was halted for two hours. After trading was resumed the Sensex soared 806 points at 14,284.21 following which trading was halted for the day.
Further, the 30 Sensex companies, which account for over 47 per cent of the total market-cap of all the companies, saw their combined market valuation rise by over Rs 3.16 lakh crore today.
However, the hopes are still not dashed completely as Dalal Street is pinning on another spectacular performance tomorrow with an eye on 15,000-points milestone for Sensex, even if it does not match today's historic gain of 2,111 points.
During 60 seconds of trade today -- first for 30 seconds at the opening and then another 30 seconds after trade resumed at 1155 hours -- investors' wealth measured in terms of total market capitalisation of all the listed companies grew by about Rs 6,50,000 crore. This is the biggest ever gain in the history of stock market, not only in India, but possibly in the entire world.
This sharp surge, the best ever post-polls performance of stock market in India, comes in sharp contrast to a huge loss suffered after the last general elections in 2004.
Election results had been announced during trading hours on May 13, 2004 and Sensex had ended up 0.8 per cent after highly volatile trade, but lost over 300 points the next day. In following trading session on May 17, 2004 Sensex plunged 11.1 per cent, its biggest drop in 12 years.
The Sensex had lost over 894 points in the two days after the election results were out in May 2004.
Meanwhile, today the total investors' wealth, measured in terms of combined market-cap of all the listed companies, has increased by over Rs 6,56,477 crore in a minute -- in the first 30 seconds and then after resumption trading in the afternoon -- to Rs 44,63,420.97 crore.
The 30-share Bombay Stock Exchange Sensex zoomed 1,305.97 points at 13,479.39, hitting the upper circuit with seconds of opening of trade, following which trading was halted for two hours. After trading was resumed the Sensex soared 806 points at 14,284.21 following which trading was halted for the day.
Further, the 30 Sensex companies, which account for over 47 per cent of the total market-cap of all the companies, saw their combined market valuation rise by over Rs 3.16 lakh crore today.
Sensex creates History; two upper circuits in one day
MUMBAI: Markets have stopped trading for the day as the benchmarks hit another upper circuit Monday as soon as the trade resumed after 2 hour
break. Investors are euphoric after the United Progressive Alliance emerged victorious in the 2009 general elections. ( Watch )
Bombay Stock Exchange’s Sensex was locked at 14272.62 up 2099.21 points or 17.24 per cent. National Stock Exchange’s Nifty was locked at 4308.05, up 636.40 points or 17.33 per cent. According to media reports turnover including cash and F&O was less than Rs 1000 crore.
Marketmen are upbeat given the fact that there will be no interference by the Left Parties and other regional parties in day-to-day functioning of the government and less number of allies will lead to a stable government which will run its course of five years.
BHEL (32.72%), Larsen & Toubro (29.53%), DLF (25.82%), ICICI Bank (25.30%) and HDFC (23.46%) were the top Sensex gainers.
Amongst the sectoral indices, BSE Realty Index was up 25.37 per cent, BSE Capital Goods Index gained 23.47 per cent, BSE Bankex moved 20.27 per cent higher and BSE Oil&gas Index advanced 19.57 per cent.
Market breadth was positinve on the BSE with 833 advances and 11 declines.
The new government which is likely to be sworn in by Friday is expected to come-out with full budget within 45 days of resuming office, according to media reports.
Reforms in the banking sector, divestment of public sector undertakings, infrastructure, retail sector and insurance sector is likely to top the priority list.
Sensex had opened 10.73 per cent or 1305.97 points higher at 13479.39 points to 12011.10. National Stock Exchange’s Nifty was locked at 4203.30, higher by 14.48 per cent or 531.65 points.
break. Investors are euphoric after the United Progressive Alliance emerged victorious in the 2009 general elections. ( Watch )
Bombay Stock Exchange’s Sensex was locked at 14272.62 up 2099.21 points or 17.24 per cent. National Stock Exchange’s Nifty was locked at 4308.05, up 636.40 points or 17.33 per cent. According to media reports turnover including cash and F&O was less than Rs 1000 crore.
Marketmen are upbeat given the fact that there will be no interference by the Left Parties and other regional parties in day-to-day functioning of the government and less number of allies will lead to a stable government which will run its course of five years.
BHEL (32.72%), Larsen & Toubro (29.53%), DLF (25.82%), ICICI Bank (25.30%) and HDFC (23.46%) were the top Sensex gainers.
Amongst the sectoral indices, BSE Realty Index was up 25.37 per cent, BSE Capital Goods Index gained 23.47 per cent, BSE Bankex moved 20.27 per cent higher and BSE Oil&gas Index advanced 19.57 per cent.
Market breadth was positinve on the BSE with 833 advances and 11 declines.
The new government which is likely to be sworn in by Friday is expected to come-out with full budget within 45 days of resuming office, according to media reports.
Reforms in the banking sector, divestment of public sector undertakings, infrastructure, retail sector and insurance sector is likely to top the priority list.
Sensex had opened 10.73 per cent or 1305.97 points higher at 13479.39 points to 12011.10. National Stock Exchange’s Nifty was locked at 4203.30, higher by 14.48 per cent or 531.65 points.
Tuesday, May 12, 2009
Suzlon raises $47 mn from stake sale: Report
MUMBAI: The founders of Suzlon Energy Ltd raised $47 million by selling 30 million shares, or 2 percent stake, at Rs 77 each on Tuesday, two sources with knowledge of the deal said.
The deal was done within hours of opening on Tuesday evening, they said. Citigroup was the sole bookrunner for the deal. Shares in Suzlon, which the market values at around $2.5 billion, have risen 29.8 percent in 2009 compared to a 26 percent rise in the benchmark index. The stock had tumbled 83.9 percent in 2008, hit by quality woes, tight liquidity and a plunge in the broader market.
The deal was done within hours of opening on Tuesday evening, they said. Citigroup was the sole bookrunner for the deal. Shares in Suzlon, which the market values at around $2.5 billion, have risen 29.8 percent in 2009 compared to a 26 percent rise in the benchmark index. The stock had tumbled 83.9 percent in 2008, hit by quality woes, tight liquidity and a plunge in the broader market.
Tuesday, January 6, 2009
2008 slump wipes out $17 tn in stock value: S&P
The nightmarish stock market performance in 2008 erased some 17 trillion dollars in share value worldwide, a Standard & Poor's report said on Tuesday.
S&P's estimate is based the value of its Global Broad Market Indices, comprised of 46 major stock indexes around the world. Emerging market indexes fell 54.72 percent and developed markets dropped 42.72 percent for the year, according to S&P.
The losses, coming in a year that was the worst in many countries since the Great Depression, were moderated somewhat by a modest rebound in December, with 19 of the 21 emerging markets and 22 of the 25 developed markets posting gains during the month.
A glimmer of hope, that is how we can define December," says Howard Silverblatt, analyst at Standard & Poor's and author of the report. "As central banks race to reduce rates, add liquidity and shore up their local economy, markets remain cautiously optimistic as we move into 2009. However, as evident by the huge stockpiles of cash still on the sidelines, many world markets are taking a wait-and-see approach. The result is a continuance of extreme market volatility."
Among the worst performers in 2008 were the "BRIC" countries: Brazil (down 57.35 percent), Russia (73.67 percent), India (64.51 percent), and China (53.21 percent), according to S&P.
Morocco was the best performer among emerging market countries, limiting its loss to 15.85 percent. The second-best performer was Israel, with a loss of 34.68 percent.
In developed markets, Ireland was the worst with a loss of 69.94 percent, followed by Greece (66.50 percent) and Norway (66.07 percent).
S&P said its Japan index was the best among developed nations with a loss of 29.22 percent, followed by Switzerland (30.60 percent) and the United States (38.68 percent). The US market was the third "best" performer among developed markets and fifth best among all global equity markets.
Among various sectors, financials lost 53.77 percent and materials lost 52.9, representing the two worst industries
. The energy sector plunged 44.5 percent.
S&P's estimate is based the value of its Global Broad Market Indices, comprised of 46 major stock indexes around the world. Emerging market indexes fell 54.72 percent and developed markets dropped 42.72 percent for the year, according to S&P.
The losses, coming in a year that was the worst in many countries since the Great Depression, were moderated somewhat by a modest rebound in December, with 19 of the 21 emerging markets and 22 of the 25 developed markets posting gains during the month.
A glimmer of hope, that is how we can define December," says Howard Silverblatt, analyst at Standard & Poor's and author of the report. "As central banks race to reduce rates, add liquidity and shore up their local economy, markets remain cautiously optimistic as we move into 2009. However, as evident by the huge stockpiles of cash still on the sidelines, many world markets are taking a wait-and-see approach. The result is a continuance of extreme market volatility."
Among the worst performers in 2008 were the "BRIC" countries: Brazil (down 57.35 percent), Russia (73.67 percent), India (64.51 percent), and China (53.21 percent), according to S&P.
Morocco was the best performer among emerging market countries, limiting its loss to 15.85 percent. The second-best performer was Israel, with a loss of 34.68 percent.
In developed markets, Ireland was the worst with a loss of 69.94 percent, followed by Greece (66.50 percent) and Norway (66.07 percent).
S&P said its Japan index was the best among developed nations with a loss of 29.22 percent, followed by Switzerland (30.60 percent) and the United States (38.68 percent). The US market was the third "best" performer among developed markets and fifth best among all global equity markets.
Among various sectors, financials lost 53.77 percent and materials lost 52.9, representing the two worst industries
. The energy sector plunged 44.5 percent.
Tuesday, December 30, 2008
10 stocks to buy now
2008 saw the bearist market in decades. There are prediction of price going down in coming year too. Although it is down, fortune magazine has predicted these 10 stocks to be of value for the year 2009. What does these stocks which were sometime ago 4 times the value of current market price hold for investors? Lets have a look.
10 stocks to buy now
10 stocks to buy now
Friday, December 19, 2008
Best & Worst in Money 2008: Biggest fall from grace
In 2008, many big names took big face plants. Since this is a blog about money, I ranked them based on how much they lost and how far they fell. As you can see, the method is not exactly scientific. Here are the five biggest falls from grace:
Richard Fuld, Lehman Brothers. The $639 billion bankruptcy is history's largest so far by a factor of at least six. And Fuld personally lost about $1 billion in his personal holdings of Lehman stock. And the repercussions of letting Lehman fail stretched from money market funds to Iceland. Ouch!
Jimmy Cayne, Bear Stearns CEO. Cayne lost plenty of his personal wealth when Bear Stearns stock stumbled. But at least shareholders were able to get out with something when JPMorgan Chase (NYSE: JPM) bought it.
Eliot Spitzer, New York governor. Spitzer destroyed his once promising political career by spending time with at least one woman other than his wife. He was trying to use his prosecution of Wall Street to boost his political career as Rudy Giuliani did. But his self-destructive urges got the better of him.
Sheldon Adelson, CEO, Las Vegas Sands (NYSE: LVS). Adelson, a colorful character who was a consulting client of mine, has lost $30 billion on paper thanks to his excessive debt load and a decline in gambling.
Jerry Yang, CEO, Yahoo! (NASDAQ: YHOO). Poor Jerry Yang suffered from delusions about his ability to revive his creation. He lost a chance to boost shareholder returns by selling to Microsoft Corp. (NASDAQ: MSFT) for $31 a share. With the stock at $11.51, he left big bucks on the table, and the board kicked him out of the big chair.
Let us know which one you would chose as the biggest fall of 2008.
Peter Cohan is president of Peter S. Cohan & Associates. He also teaches management at Babson College and edits The Cohan Letter. He has no financial interest in the securities mentioned.
Richard Fuld, Lehman Brothers. The $639 billion bankruptcy is history's largest so far by a factor of at least six. And Fuld personally lost about $1 billion in his personal holdings of Lehman stock. And the repercussions of letting Lehman fail stretched from money market funds to Iceland. Ouch!
Jimmy Cayne, Bear Stearns CEO. Cayne lost plenty of his personal wealth when Bear Stearns stock stumbled. But at least shareholders were able to get out with something when JPMorgan Chase (NYSE: JPM) bought it.
Eliot Spitzer, New York governor. Spitzer destroyed his once promising political career by spending time with at least one woman other than his wife. He was trying to use his prosecution of Wall Street to boost his political career as Rudy Giuliani did. But his self-destructive urges got the better of him.
Sheldon Adelson, CEO, Las Vegas Sands (NYSE: LVS). Adelson, a colorful character who was a consulting client of mine, has lost $30 billion on paper thanks to his excessive debt load and a decline in gambling.
Jerry Yang, CEO, Yahoo! (NASDAQ: YHOO). Poor Jerry Yang suffered from delusions about his ability to revive his creation. He lost a chance to boost shareholder returns by selling to Microsoft Corp. (NASDAQ: MSFT) for $31 a share. With the stock at $11.51, he left big bucks on the table, and the board kicked him out of the big chair.
Let us know which one you would chose as the biggest fall of 2008.
Peter Cohan is president of Peter S. Cohan & Associates. He also teaches management at Babson College and edits The Cohan Letter. He has no financial interest in the securities mentioned.
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