Continued buying activity led the Indian markets to rise higher during the previous two hours of trade. Barring IT, stocks across the sectors have managed to record gains today. Those leading the pack include stocks from the auto, metals and banking spaces. Healthcare and power stocks are amongst the lowest gainers at present.
The BSE-Sensex is trading higher by 120 points while the NSE-Nifty is trading higher by 40 points. The BSE-Midcap and BSE-Smallcap indices are trading higher by 1% and 1.5% respectively. The rupee is trading at 44.72 to the US dollar.
As per a leading business daily, Wockhardt's plan to sell its nutrition business to US-based Abbott Laboratories for about Rs 6.5 bn has been terminated. This is because Wockhardt was unable to resolve debt restructuring issues with some of its lenders. The deal hit a roadblock after differences regarding rights on the sale proceeds cropped up between the Wockhardt's secured and unsecured creditors.
Wockhardt's nutrition category comprises brands like Farex, Dexolac, Nusobee infant formulas and Protinex. Last year this division had reported revenues of around Rs 1.5 bn. The move to sell the nutrition business was actually a part of the company’s plans to divest its non-core businesses to retire debt as the debt equity ratio was as high as 4.2 in CY08. Last year, the company had sold off two non-core businesses - animal health to French company Vetoquinol and its German subsidiary Esparma to another German company Lindopharm. Wockhardt has been divesting its non-core businesses as it plans to raise Rs 7.9 bn as part of its corporate debt restructuring (CDR) programme. The company has a total debt burden of Rs 37 bn. The stock, along with its peers Cadila Healthcare, Biocon and Dr. Reddy's, is trading higher currently.
Passenger car manufacturer, Maruti Suzuki had planned to raise the prices of its vehicles across different models. On April 2, the company made the announcement with respect to the hike as a move to pass on part of the increase in costs to customers. The company’s manufacturing cost has increased on account of higher input costs and expenses from the introduction of the new Bharat Stage IV emission norm. The price hike is less likely to impact the company’s volumes considering the strong demand for the company’s different models. The company had last week announced its sales volumes for the month of March and the full year FY10. For the full year sales volume growth stood at 29% YoY. Domestic sales grew by about 21% YoY, while exports grew by about 111% YoY. The stock of Maruti Suzuki is trading marginally lower on the bourses currently.