A ROLLER - COASTER RIDE

It turned out to be a roller-coaster ride for the frontline indices which zoomed over three percent in today's session but finished the day with moderate gains of around half a percent. The Union Budget 2011-12 had a surfeit of positives including retention of excise duty and service tax at 10%, a lower than forecasted fiscal deficit target of 4.6% for FY12, more spending power to consumers through an increase in income tax exemption limit, and permission for foreign investors to invest in Indian mutual funds. The positives led to around a 600 point short covering rally but the jubilation met with strong resistance at crucial 18,300 levels which eventually resulted U-turn for the 30 share benchmark. Weak start for the European counterparts along with towering crude oil prices over fears of supply disruption in the wake of the political turmoil in West Asia, limited the upside for the indices. The NSE's 50-share broadly followed index, Nifty climbed around half a percent and settled below the crucial 5,350 level while the Bombay Stock Exchange's Sensitive Index, Sensex managed to hold on to the psychological 17,800 mark. The broader markets continued their run of underperformance against their larger peers for yet another day as the BSE's midcap and smallcap indices went home with moderate gains of 0.31% and 0.36% respectively. The FMCG counter on the BSE sectoral space settled as the top gainer as it rallied 4.47% underpinned by ITC, the FMCG major, which skyrocketed 8.23% in the absence of any excise duty hike on cigarettes and other tobacco products. The Public sector Undertaking (PSU) pocket too witnessed huge buying interests as it surged 2% on the back of 12.42% spurt in Coal India after the company  opined that it would get $1.4 billion in additional revenue and realizations will go up 12.5% to 13% in the next fiscal year as the firm hiked prices by 30%. The healthcare pack on the other hand remained the only laggard in the space as it settled with loss of 0.04% after stocks of companies like Glenmark Pharmaceuticals and Ranbaxy plummeted 10.20% and 3.59% respectively. Index heavyweight Reliance Industries failed to make its presence felt as it settled with marginally losses on the BSE after erasing all early gains due to profit-booking amid a volatile broader market.

On the global front, majority of Asian benchmarks snapped the day in the positive terrain as investors resorted to hefty buying in undervalued stocks despite the escalating civil upheaval in OPEC-member Libya. Hong Kong's benchmarks, Hang Seng remained the top gainer in the space as it went home after surging by around one and half a percent. But the European markets failed to gain any kind of momentum today as they traded on a somber note with moderate losses with the FTSE 100 sinking around half a percent point. On the other hand, the screen trading for US index futures indicated that the Dow could open on a flat to negative note.

Earlier on the Dalal Street, the benchmark began the day on a firm note as leads from the US markets which snapped Friday's session with good gains lifted regional sentiments to some extent. The frontline indices gradually capitalized on the initial momentum as Finance Minister tabled the progressive and balanced Union Budget 2011-12 in the Lok Sabha. Soon after FM's speech the markets rallied around 600 points in a euphoric atmosphere as participants resorted to hefty buying. However, the indices went into tailspin as the finer print became clearer and the force of profit-booking at higher levels took its toll. Eventually the bourses snapped the session with moderate gains of around half a percent on the last day of the month. The markets registered volumes of over Rs 2.03 lakh crore while the turnover for NSE F&O segment remained at over Rs 1.83 lakh crore on the initial day of a new week. The market breadth on the BSE was positive as there were 1598 shares on the gaining side against 1204 shares on the losing side while 131 shares remained unchanged.

Finally, the BSE Sensex rose 122.49 points or 0.69% to settle at 17,823.40 while the S&P CNX Nifty added 29.70 points or 0.56% to end at 5333.25.

The BSE Sensex touched a high and a low of 18,296.53 and 17,718.88, respectively.

The top gainers on the Sensex were ITC up 8.23%, M&M up 3.19%, Maruti Suzuki up 3.07%, ONGC up 2.93% and Sterlite Inds up 2.38%.

On the flip side, Rel Infra down 4.46%, Jaiprakash Associates down 2.88%, Hero Honda down 2.36%, Tata Motors down 2.11% and Tata Power down 1.79% were the major losers on the index.

The BSE Mid-cap and Small-cap indices soared 0.31% and 0.36%, respectively.

Budget Highlights:

• Foreign dividend tax rate cut at 15% for Indian companies
• Investment linked Deductions for Fertilizers cos 
•  FY12 Net market borrowing target at Rs 3.43 lakh crore  
• No excise duty on Equipment for UMPPs  
• Ship owners allowed duty-free spare parts import  
• Cut customs duty on Petcoke, Gypsum to 2.5%  
• 20% ad-volorem Export Duty on Iron Ore  
• To replace excise duty with ad-valorem duties for Cement  
• Custom Duty on Raw Steel cut  
• Cut customs duty on yarn to 5% from 7.5%  
•  Peak rate for Custom Duty unchanged  
• 1% excise duty on 130 new items  
• Basic Food, Fuel exempted from Central Excise Duty  
• To keep the standard rate for Excise Duty at 10%  
• Direct tax sops to result in Rs 11,500 crore net revenue loss  
• Low withholding of tax of 5% for Notified Infra Funds  
• Service tax retained at 10%  
•  Surcharge reduced from 7.5% to 5% for domestic companies  
• Income tax exemption limit raised to Rs 1.8 lakh from Rs 1.6 lakh 
•  MAT raised to 18.5% from18%  
• FY 13 fiscal deficit target at 4.1%  
• Rs 300 crore provided to promote pulses cultivation in rain-fed areas  
• FY 12 Fiscal Deficit seen at 4.6%  
• FY12 non tax revenue seen at Rs 1.25 lakh crore
• Multi nutrient based subsidy policy for Urea  
• Rs 21,000 crore allocation towards literacy mission  
• To move insurance, pension and banking bills in parliament  
• To introduce self assessment system in Customs  
• To raise rural infra fund from Rs 16,000 crore to Rs 18,000 crore  
• Banks to cover 2,000 villages for opening accounts in FY12  
• Easier service tax refund for goods exporters  
• To give Rs 8000 crore to J&K for development needs  
• SEZs to benefit from easier service tax refund  
• Rs 6000 crore to enable banks to maintain 8% TIER 1 capital  
• Healthcare sector to get allocation of Rs 26,760 crore  
• To infuse Rs 500 crore in Regional Rural Banks (RRBs)  
• To treat capital investment in fertilizer sector as Infra  
• To give Rs 5000 crore to SIDBI to refinance small firms  
• Mortgage risk guarantee fund for home loans to poor  
• Allocated Rs 58,000 crore for social schemes (Bharat Nirman)  
• Education sector allocated Rs 52,057 crore in FY12  
• To set up institution for tracking black money  
• Allocation for farm development hiked to Rs 7860 crore  
• QFIs allowed in to invest in MF scheme  
• FY12 IFCL disbursement target upped to Rs 25,000 crore  
• Direct cash subsidy on kerosene, fertilizers for BPL  
• PPP model has been positive in Infra projects  
• To raise corpus of rural infrastructure development fund to Rs 180 billion in 2011-12  
• To give 3% interest subsidy farmers in FY12  
• Propose to give Rs 3000 crore to NABARD  
• To set up national mission for hybrid, electric vehicles  
• Propose to introduce tax free bonds of Rs 30,000 crore for infra  
• Current A/C gap a concern due to composition of FX flows  
• To give infra status to cold storage chains  
• Rollout of DTC effective April 1, 2012  
• Increased the credit inflow from Rs 3,75,000 crore to Rs 4,75,000 crore  
• FII allowed to invest in Corporate Infra bonds 
• New companies bill to be introduced in current session  
• Upped priority home loan limit to Rs 25 lakh from Rs 20 lakh  
• Infra sector FII cap for bonds with 5 year residual maturity  
• To bring bill to enable RBI to give more private banking licenses  
• Capital infusion of Rs 20,157 crore in PSU banks in FY12  
• Investment in corporate bonds hiked to $40 billion  
• FIIs allowed to invest in MF schemes  
• Discussion on to further liberalize FDI policy  
• Divestment target at Rs 40,000 crore 

All the BSE sectoral indices barring Healthcare (HC), which was down by 0.04%, were trading in the green. Fast Moving Consumer Goods (FMCG) up 4.47%, Public Sector Undertakings (PSU) up 2%, Realty up 1.30%, Capital Goods (CG) up 0.60% and Oil & Gas up 0.58% were the major gainers.

Coal India (CIL) decided to revise the coal prices effective from February 25, 2011, due to the revision of coal prices, the company would generate an approximate additional revenue of Rs. 650 crore in 2010-11 and Rs. 6200 crore in 2011-12.

The board gave the approval for the same at its meeting held on February 25, 2011.

Coal India is the largest coal producing company in the world, based on the company's raw coal production of 431.26 million tons in fiscal 2010. As of March 31, 2010, the company operated 471 mines in 21 major coalfields across eight states in India, including 163 open cast mines, 273 underground mines and 35 mixed mines, which include both open cast and underground mines. The company also produces non-coking coal and coking coal of various grades for diverse applications.

The S&P CNX Nifty touched a high and a low of 5477 and 5308.60, respectively.

The top gainers on the Nifty were ITC up 8.41%, IDFC up 5.32%, Rel Capital up 4.46%, ONGC up 3.78% and BPCL up 3.32%.

On the other hand, Sesa Goa down 6.80%, Rel Infra down 5.07%, Ambuja Cement down 4.30%, Jaiprakash Associates down 3.76% and Ranbaxy down 2.93% were the major losers on the index.

European markets were trading mixed on Monday. France's CAC 40 gained 0.08%, Germany's DAX jumped 0.03%, while Britain's FTSE 100 shed 0.55%.

Most of the Asian equity indices finished in the positive terrain on Monday led by Japanese stocks which increased about one and a half percent as investors shrugged off worries over political turmoil in OPEC-member Libya the country's industrial production increased. However, Seoul Composite dropped more than one percent following threats by North Korea to retaliate against South Korea for participating in annual military drills with the US While, Stock markets in Taiwan remained closed today on account of a public holiday.