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Realty Stocks Lead the Gains
Mon, 8 Feb 01:30 pm

After opening the day on a flattish note, the Indian indices turned choppy and continued to trade near the dotted line. Sectoral indices are trading mixed with stocks from the telecom, realty and capital goods sectors leading the losses. IT stocks are trading in the red.

The BSE Sensex is trading up by 26 points (0.1%) and the NSE Nifty is trading up by 4 points (0.1%). Both, the BSE Mid Cap and the BSE Small Cap indices are trading up by 0.9%. Gold prices, per 10 grams, are trading at Rs 27,680 levels. Silver price, per kilogram, is trading at Rs 36,107 levels. Crude oil is trading at Rs 2,123 per barrel. The rupee is trading at 67.83 to the US$.

Stocks in the pharma space are trading on a mixed note with Elder Pharma and Divis Laboratories leading the losses. As per a leading financial daily, Promius Pharma LLC, a subsidiary of Dr Reddy's Laboratories Ltd, has received an approval from the US Food and Drug Administration (US FDA) for Sernivo Spray. Sernivo, generally called as betamethasone dipropionate, is used to treat mild to moderate plaque psoriasis in patients who are 18 years and older. An equivalent topical steroid product Clobex spray of Galderma Laboratories, used in treatment of psoriasis had US$100 million sales in 2014.

Dr Reddy's announced that the commercial launch of the product is planned for the coming quarter. The company's management stated that the FDA approval of Sernivo Spray is a significant milestone for Promius, as it will validate the company's committed efforts and resources to developing differentiated dermatology products from concept to commercial launch.

Dr Reddy's is planning to expand its portfolio of medical dermatology products available in the US market. Presently the company has four dermatology products in the US with sales of around US$ 36 million in FY15.

Through its three business verticals- Pharmaceutical Services and Active Ingredients, Global Generics and Proprietary Products, Dr Reddy's offers a portfolio of products and services including APIs (active pharmaceutical ingredient), custom pharmaceutical services, generics, biosimilars and differentiated formulations. The company has established quite a strong portfolio in the US and various other markets. The company continues to work towards varied niche products, which will be important growth drivers going forward. We continue to believe that Dr Reddy's is among the best companies in the pharma space. With quite a robust business portfolio, the company has been able to grow at a healthy pace globally despite challenges. Presently the stock of the company is trading down by 1.2%.

Majority of the stocks in the mining space are trading on a positive note with Gujarat NRE Coke and Ashapura Minechem leading the gains. As per a leading economic daily, state owned Coal India Ltd is going to conduct a special auction this month to offer coal to distressed power producers. The company has announced that it will put up 3 MT (million tonnes) on offer in the third round of auction for those distressed power plants which have neither linkages nor power purchase agreements. The company had so far put on offer 7 MT of coal under the two phases of special auction held in this fiscal.

All of these efforts are undertaken as the government has geared up to provide round-the-clock electricity. The government has set a target to provide 24x7 affordable power to all by 2019 (subscription required). Coal India, a major supplier of coal to the power sector, is also eyeing one billion tonnes of production target by 2020. It aims to achieve 550 MT of output target in the current fiscal.

On a separate note, Coal India is going to acquire 50% of the entire explosives business of Indian Oil Corporation (IOC). The acquisition is aimed at warranting steady supply of quality explosives used to extract coal from open-cast mines. The two government-owned companies have signed a memorandum of understanding (MoU), whereby 12 explosive making units of IOC will have joint ownership with CIL. For this, a joint venture company will be floated and is likely to start production from March 2017. The development will allow Coal India uninterrupted supply of explosives.

Scrip of Coal India is trading down by 0.2%.

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Mar 22, 2018 (Close)