Capital Goods Sector Report for the week (16-20.07.2012)
Stocks of capital goods and engineering companies are seen moving in a narrow band next week, with stock-specific action in the absence of any major triggers. We continue to maintain a cautious view on the sector given the multiple issues plaguing the capital goods and engineering space. Limited orders, high interest rates, land acquisition and environmental clearance hurdles, policy inaction, and an overall industrial slowdown are keeping investors at bay from the capital goods and engineering space. Industrial growth data released by the Central Statistics Office Thursday showed capital goods output fell 7.7% in May versus a growth of 6.2% a year ago. We expect the capital goods sector to continue with its subdued performance in the June 2012 quarter. New order inflows, key growth driver for the industry, have remained lukewarm. Since the demand for capital goods is derived from other sectors such as power, infrastructure, and mining, among others, the growth of the sector would depend on the conditions of these sectors. By RUPEE DESK [email protected] -- You received this message because you are subscribed to the Google Groups "Kences1- Rupeedesk" group. To post to this group, send email to [email protected]. To unsubscribe from this group, send email to [email protected]. For more options, visit this group at http://groups.google.com/group/kences1?hl=en.
