EQUITY- STOCK ALERTS

NTPC, SAIL and NMDC may witness some action today

Country's largest power producer NTPC is planning a capital expenditure of Rs 20,200 crore in 2013-14 towards enhancing its generation capacity. This amount earmarked is lesser than Rs 20,995 crore for 2012-13. The company's capital expenditure would be funded through internal accruals. As on December 31, 2012 the authorized share capital of the company stood at Rs 10,000 crore and paid up capital at Rs 8,245.50 crore. NTPC has installed capacity of about 40,000 MW and plans to enhance it to about 70,000 MW by March, 2017. Meanwhile, the Finance Ministry has also kept a provision for compensating the company after its proposed hydro plant in Uttarakhand was scrapped in 2010. A Group of Ministers (GoM) in 2010 had scrapped the NTPC's controversial 600-MW Loharinag Pala hydel project on Bhagirathi river in Uttarakhand.

State-run Steel Authority of India (SAIL) plans to spend Rs 13,000 crore next fiscal to part-fund ongoing expansion, which will take its installed capacity to over 24 million tonnes per annum (mtpa). The proposed investment represents an increase of Rs 1,000 crore than SAIL is expected to put in the current fiscal, but Rs 1,500 crore lower than the budgetary estimate for the current fiscal. The entire expenditure proposed for the next fiscal will be funded by SAIL from its internal resources. SAIL has 14 mtpa steel-making capacity and post-expansion, costing a total of Rs 72,000 crore, it will go up to 24 mtpa. Out of the Rs 13,000 crore capex for the next fiscal, Bhilai Steel Plant is proposed to get the highest share at Rs 5,900 crore for installation of a 700 tonnes per day (tpd) oxygen plant, a hot metal de-sulphurisation unit and a railway track.

Aiming to increase its flagging sales, sate-owned miner NMDC has reduced prices of higher grade iron ore (lumps) by about 2.5 percent for the current month. This is the fourth reduction since October in iron ore lump prices by NMDC. Its sales had dipped over 27 percent (at Rs 2,047 crore) and profit by over 30 percent (at Rs 1,293 crore) during the October-December quarter. However, the company has not changed the prices of iron ore fines (lower grade) for March. Domestic steel makers are going to be benefited the most with the price reduction for iron ore lumps (having iron content of 62 percent or above). After the price cut, iron ore lumps would be available in the range of Rs 4,980 per tonne, while the unchanged fines (having iron content of less than 60 percent) are currently at Rs 2,610 per tonne. Since October, the largest domestic producer of iron ore has either reduced the iron ore prices on a monthly basis or kept them unchanged as demand has been subdued.

With the government withdrawing Kingfisher Airlines' international flying rights and domestic slots, the Jet Airways has approached the Aviation Ministry to acquire six of the vacant slots. Out of the six slots from Mumbai, Jet has sought three morning slots and remaining three evening ones. Last week, the government had withdrawn all domestic and international flying slots of Kingfisher Airlines, which remains grounded since October 1 last, with immediate effect and decided to allot them to other domestic airlines. Besides operating on domestic routes, Kingfisher also used to operate to Britain (seven flights a week), the UAE (21 flights per week), Thailand (21 weekly flights), Nepal (seven), Bangladesh (14 a week), Sri Lanka (35 per week), Hong Kong (14 a week) and Singapore (7). The withdrawal of these slots has made available approximately 25,000 seats per week for other carriers to these eight countries.

Jindal Steel and Power (JSPL) has increased prices of its products by up to Rs 1,000 per tonne for the current month. For steel plates and coils, the company has increased the prices by about Rs 1,000 per tonne, while prices of its long products have gone up by about Rs 500 per tonne. The input costs have increased substantially in the last one month due to $20 per tonne increase in coking coal rates internationally, realignment in fuel prices and its resultant impact on freight charges. The Naveen Jindal-led company currently has a total steel production capacity of 3 million tonnes per annum (MTPA) at its Raigarh plant in Chhattisgarh. Of this, it produces 2 MT long products like TMT bars and saria, while its flat production capacity is 1 MT.

Tata Communications plans to sell properties across Delhi, Mumbai and Chennai to raise more than Rs 2,500 crore to raise capital in the wake of continuing losses. Tata Group's telecom arm, which reported a net loss of Rs 201 crore for the third quarter ended December, has identified land parcels valued at over Rs 2,500 crore in these metros for monetization. The firm owns prime plots of over one acre each across these cities. Tata Communications has appointed property consultancy firms Jones Lang LaSalle India and Cushman & Wakefield to help sell some unutilized properties that originally belonged to Videsh Sanchar Nigam. Tata's acquired VSNL in 2002.

With RBI issuing guidelines for new bank licences, diversified group Videocon Industries will enter the banking sector with a foreign partner and has earmarked Rs 1,000 crore for the purpose. Already, the company has entered the financial sector through its joint venture with Liberty Mutual Insurance. The company meets the criteria set by Reserve Bank of India (RBI) for the new banking licence and would use its experience of collaborations with foreign partners. Last month RBI had issued the much-awaited guidelines for new bank licences, allowing corporates and public sector entities with sound credentials and a minimum track record of 10 years to enter the banking business.

As workers and the Hero MotoCorp management struggle to reach a middle ground, the Gurgaon-Manesar cluster is closely watching the outcome of wage discussions between the workers' union and the management at Hero Motocorp. The workers' demands, if met, will catapult their average cost-to-the-company (CTC) to a range of Rs 60,000-65,000 per month from the current level of Rs 47,000-50,000, which automotive players in the region say will take the sheen off what has so far been touted as the global advantage of low-cost manufacturing. The Gurgaon-Manesar belt alone churns out almost half of the total cars and two-wheelers produced in the country and companies fear that any abnormal rise in wages could prove detrimental to India's auto industry.

With infrastructure and construction sectors expected to see a revival over the next two-three years, equipment manufacturer Action Construction Equipment (ACE) is eyeing nearly Rs 2,000 crore revenue by FY16. ACE manufactures mobile cranes, tower cranes, loaders, vibratory rollers, truck-mounted cranes, crawler cranes, forklifts, tractors and other construction equipment and caters to infrastructure, construction, heavy engineering and industrial projects. The BSE-listed company currently has two factories at Faridabad in Haryana and Kashipur in Uttarakhand with a manufacturing capacity of 9,000 construction equipment and 6,000 tractors. The company, which is currently enjoying over 50 percent share in the mobile cranes market is also looking at increasing the contribution of tractors in its revenues. ACE tractors are currently sold in Punjab, Haryana and Uttar Pradesh and plans are afoot to enter Jharkhand, Orissa, Bengal and Maharashtra.

Financial software solutions provider Dion Global expects revenues this fiscal to rise by 35 percent to Rs 235 crore on the back of increased sales from its acquisitions in the UK and Germany. Besides, the company has been performing well in the governance, risk compliance and financial analytics verticals, which will also add up in the sales. The company had reported a consolidated net sales of Rs 174.05 crore in 2011-12 fiscal and a consolidated net loss of Rs 30.90 crore. Dion acquired UK-based Investmaster Group, a provider of wealth management and stock-broking software, in October 2011. In January 2012, the Noida-headquartered company acquired Swissrisk Financial Systems. The Frankfurt-based firm provides solutions in payments, securities and funds industry.