Indian stock markets indices traded in the green over the last two hours of trade led by sustained buying activity witnessed across industry heavyweights. Barring Capital goods, all the indices are trading in the green with software and Technology stocks leading the gainers.
Barring Tata Power and Torrent Power, power stocks are mainly trading in the green led by Jaiprakash Power and Neyveli Lignite. As per a leading financial daily, Power Grid Corporation of India Ltd (PGCIL) has been given board approval for two projects worth Rs 16.8 bn. Of the two, one project is for strengthening Raipur-Wardha Corridor for IPP (Independent Power Producer) Projects in Chhattisgarh. The estimated cost for this project is Rs 14 bn and is expected to be commissioned within three years from the date of approval. The other project is the transmission system for establishment of 400/220kV GIS substation at Magarwada in Daman & Diu. The estimated cost for this one is Rs 2.6 bn and is expected to be commissioned within two years from the date of approval. The stock is trading in the green.
Majority of the textile companies are trading in the green with Welspun India and Century Textiles trading the strongest. As per a leading financial daily, textile units are shifting base to Bangladesh to benefit from lower production costs. The textile industry profitability has been hit by the 10% excise levy on branded garments, rising interest rates and demand slowdown. The government recently removed the import duty on 46 textile items, mainly garments, from Bangladesh (as per Confederation of Indian Textile Industry). The garment imports previously attracted 10% ad valorem or specific duty, whichever is higher. To take advantage of duty concessions and cheap labour, textile companies, particularly from Kolkata, have started setting up units in Bangladesh. According to the Apparel Export Promotion Council, textile units importing from Bangladesh and selling in India will save 20% in their overall costs. Besides Bangladesh also extends a tax concession in textile exports to developed countries.