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Monday 3 November 2014

Profit booking drags Sensex, Nifty; SBI, Reliance gainers

1:50 pm Results: Public sector lender Bank of India met street expectations with the profit rising 26.4 percent year-on-year to Rs 786 crore in September quarter led by fall in provisions and higher net interest income. Profit in the year-ago period was Rs 621.77 crore. Net interest income, the difference between interest earned and interest expended, shot up 20 percent (better than expectations) to Rs 3,031 crore in the second quarter of current financial year 2014 compared to Rs 2,527 crore in same quarter last year but other income (non-interest income) declined by 8.5 percent to Rs 1,006.4 crore during the same period.

Net profit was expected at Rs 786 crore and net interest income at Rs 2,745 crore for the quarter, according to the average of estimates of analysts polled by CNBC-TV18.

1:30 pm Brokerages downgrade: Shares of Gail fell 6 percent intraday on Monday after a slew of downgrades by brokerage. This is despite September quarter net profit more than doubled (Q-o-Q) to Rs 1,303 crore led by other income and strong operational performance.

CLSA has its rating to sell from outperform with a target of Rs 475 per share as it feels that the state-run natural gas transmission company is trading at 40 percent premium to its 10 year average price to equity. Hence CLSA finds these valuations unsustainable since turnaround in core business is unlikely in next two years and return-on-equities (ROEs) will remain under pressure.

"Gail did not build any subsidy burden pending quarterly demand from oil ministry and this boosted its Q2 FY15 net profit The recent stock price rally completely ignores earnings risk from falling crude given its big sensitivity,” CLSA said in a note. More information please visit this site www.bigprofitbuzz.com


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