Indian share markets continued to slip further in the post-noon trading session. Majority of the sectoral indices are trading in the red with metal and FMCG indices being the biggest losers. IT & power are the among the few stocks trading positive today.
Majority of the food & tobacco stocks are trading in the red led by ITC and Godfrey Phillips. As per a leading financial daily, the government wants to amend the anti-smoking law. As per the amendment, the government has proposed a ban on the sale of loose cigarettes and raising the age-limit for buying tobacco products from 18 to 21 years. Since a large proportion of cigarettes sold is in the form of loose cigarettes, 70% as per Euromonitor International, the proposed amendment is likely to impact the sale of cigarette companies. In addition, the Health Ministry has suggested that the fine amount on smoking in public places be raised from Rs 200 to Rs 1000 and the designated smoking zones in hotels and restaurants should be removed. The new bill also seeks to increase the fine from Rs 10,000 to Rs 1 lakh in case of violation of the proposed law.
Most of the foreign pharma stocks are trading in the red with Pfizer and Novartis being the biggest losers. As per a leading financial daily, the board of directors of Novartis has given approval for the transfer of its Over the Counter (OTC) business to GlaxosmithKline Consumer Pvt Ltd (GSK) for a consideration of Rs 1.09 bn. The deal is likely to be completed by October subject to various regulatory approvals. Novartis' OTC products include Voltarin, Excedrin and Otrivin. This development comes in the light of the global deal wherein Novartis and GSK were to create a joint venture company in consumer healthcare with GSK having majority control. Novartis' parent company has divested its global OTC business that includes patents, trademarks and R&D assets. Novartis stock is currently trading down 0.7%.