India shares flat; Infosys Q3 results awaited

Thu Jan 10, 2013 6:46am EST

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* BSE ends 0.02 pct down; NSE closes 0.05 pct lower
    * Citi cuts India to 'underweight'
    * Infosys' Dec earnings may miss expectations

    By Manoj Dharra
    MUMBAI, Jan 10 (Reuters) - Indian shares ended flat on
Thursday as Infosys and other software services exporters fell
ahead of quarterly results, while cement makers slipped on
near-term outlook concerns.
    However, oil stocks such as Oil & Natural Gas Corp 
gained after government officials told reporters a long-awaited
proposal to raise fuel prices would be submitted to the federal
cabinet. 
    Citigroup also issued a cautionary note, saying a rebound in
economic growth, corporate risk appetite and the investment
cycle may not be as strong as current expectations, and
downgraded India to "underweight" from "neutral" as part of its
emerging markets review. 
    However, analysts say caution has prevailed this week ahead
of industrial output and Infosys' earnings on Friday.
 
    "Infosys' earnings and guidance would set the mood for the
Q3 earnings season, which would be key for markets till the RBI
policy," said Deven Choksey, managing director at KR Choksey
Securities. 
    Consulting strategy and possible acquisition targets would
be key for Infosys, Choksey added. 
    The BSE index fell 0.02 percent, or 3.04 points, to
end at 19,663.55. 
    The broader NSE index ended 0.05 percent, or 2.85
points, lower at 5,968.65.
    Infosys fell 0.4 percent. The country's
second-largest software exporter's October-December earnings
could fall 1.8 percent short of consensus expectations, while
revenues may disappoint by 3.2 percent, according to Thomson
Reuters StarMine estimates. 
    Ambuja Cements fell 2.7 percent and Ultratech
 ended 3.2 percent lower, while India Cements 
slipped 2.5 percent. 
     J.P. Morgan cautioned the near-term outlook for Indian
cement companies remained "hazy", in contrast with market
consensus for a strong V-shaped recovery in infrastructure
spending over the next 12 months. 
    Tata Consultancy Services ended down 1.43 percent.
    The December quarter is a seasonally weak one for technology
companies, and analysts are awaiting management comments on
customers and any changes in hiring targets, Deutsche Bank said
in a note.
     Shares of Colgate Palmolive India Ltd ended 1.1
percent lower at 1,524.75 rupees after UBS downgraded the
company to "neutral" from "buy", saying the stock has well
outperformed the consumer sector since Oct. 1, 2012.
 
    Bharat Heavy Electricals Ltd fell 2.11 percent and
Indiabulls Power Ltd was down 4.1 percent after
Barclays Capital and Citigroup raised concerns over two thermal
power projects the companies were involved in. 
    However, ONGC posted its biggest single-day gain since Nov.
30, 2012, after the oil ministry moved a proposal to the federal
cabinet to raise diesel prices. 
    ONGC shares rose 3.44 percent to their highest level since
Feb. 22, 2012, and Oil India ended 4.13 percent up.
    Tata Motors ended 1.9 percent higher, extending
gains from the previous day, following upgrades by CLSA and
Credit Suisse. Earlier in the session, its market capitalisation
crossed the 1-trillion-rupee ($18.23 billion) mark, putting in
what is now a 14-member club that also includes Reliance
Industries Ltd.

 (Additional reporting by Abhishek Vishnoi; Editing by
Subhranshu Sahu)
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