The Indian markets shed their early morning gains and moved into the negative territory during the previous hour of trade. While most of the stocks across sectors are trading low, stocks forming part of the BSE-Auto and BSE-Capital Goods indices have managed to find some interest. Stocks from the BSE-Metal and BSE-Oil & Gas indices are amongst the key losers.
The BSE-Sensex is trading lower by around 20 points, while the NSE-Nifty is down by about 10 points. Stocks from mid and small cap spaces are however trading marginally higher with the BSE-Midcap and BSE-Smallcap indices up by around 0.2% and 0.7% respectively. The rupee is trading at 45.14 to the US dollar.
Tata Motors has announced that the company has extinguished Rs 15 bn worth of debt as bond holders chose to convert their bonds into shares before maturity. This debt was in the form of Japanese Yen bonds and US Dollar series bonds. While 93% of Japanese Yen bonds were converted, 76% of the US Dollar series bonds were converted. Those bondholders who did not go for conversion would continue to hold their bonds till maturity. As a result of the conversion, Tata Motors issued 26.6 m equity shares. This conversion represents an equity dilution of 5% while reducing the companyís total debt by 7.5%. It may be noted that these bonds will mature in FY11. With this conversion, Tata Motors has reduced its indebtedness bringing some relief to the companyís highly leveraged balance sheet.
As per a leading financial daily, ITC has tied up with Dominican Republicís La Aurora to sell cigars in India. The cigars which will be manufactured in the Caribbean will be imported to India and sold by ITC. The cigars will be rolled out under the Armenteros brand and will be made to ITCís specifications, available exclusively at tobacco selling outlets, select hotels, fine-dining restaurants and exclusive clubs. While the market is nascent and worth only Rs 300 m, the category is seeing an upsurge in demand with a new section of upwardly mobile Indian consumers exploring cigars as a category. With this tie up, ITC will become the first Indian company to enter this category which up till now has been dominated by foreign imports.