Markets extend gains

Tue, 29 Mar 11:30 am

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Indian stock market indices continued their northward journey led by buying in heavy weights during the last two hours of trade. All the sectors are trading in the green except realty.

The BSE-Sensex is up by 170 points while NSE-Nifty is trading 46 points above yesterday's closing. BSE Midcap and BSE Small cap indices are up by 0.3% and 0.2% respectively. The rupee is trading at 44.72 to the US dollar.

Telecom stocks are trading firm led by Himachal Futuristic and Reliance Communications. As per a leading financial daily, Idea Cellular has stated that it would invest Rs 42 bn in 3G network infrastructure. This will include setting up of 16,000 towers by March 2012. The company intends to spend Rs 100 bn for its 3G operations. Of this, the company has already paid Rs 58 bn as license fees for spectrums in 11 circles. The telecom company plans to expand to 200 towns by April 15 this year and is targeting to reach 3,700 towns by March 2012.

Idea launched its 3G operations in its circles in Madhya Pradesh, Chattisgarh, Himachal Pradesh and Gujarat yesterday. Its 3G operations are now present in 10 cities across these circles. By April 15, it is expected to launch 3G services in the other circles where it holds licenses. Also, the company is in talks with the other industry players for offering 3G roaming services to consumers in regions in which it does not hold a license.

Energy stocks are trading firm led by Gujarat State Petronet and HPCL. As per a leading financial daily, the provisional list of winners for the ninth round of New Exploration Licensing Policy (NELP) is out. Of the 33 blocks which were up for allocation, ONGC is the provisional winner in 10 blocks while Reliance Industries Limited (RIL) is the provisional winner in 2 blocks. The recent tie-up between RIL and BP was expected to increase interest of global players in India's oil and gas sector.

However, no major overseas company participated in this round of bidding. Nevertheless, this round has been announced as a success and is expected to draw investment of Rs 45 bn. This is compared to investment of 49.5 bn drawn in the previous round in which 36 blocks were allocated. As per the Petroleum Minister, bids for this round of NELP would be evaluated over the next 3 months and contracts with the winners would be signed a month after that. It may be noted that since 1999, 235 blocks have been awarded under eight NELP rounds. This has increased the exploration coverage of the Indian sedimentary basin area from 11% to 58%.