Indian share markets were not enthused by a small 25 basis points cut in repo rate by Reserve Bank of India (RBI) and the indices drifted further below the dotted line in the post-noon trading session. Majority of the sectoral indices are trading in the negative with realty, banking and auto stocks being the major losers. metal, capital goods and IT are among the few stocks trading in the green.
All the mining stocks are trading in the green with Metals and Minerals Trading Corporation of India Ltd. (MMTC) and National Mineral Development Corporation (NMDC) being the major gainers. As per a leading financial daily, Coal India Ltd (CIL) made a positive start in FY14 by achieving its production and distribution targets for the month of April. According to the coal Minister, the company's production was up by 5.7% YoY to 35.8 MT in April. Despite some state power utilities not taking further coal supplies due to availability of sufficient stocks, CIL has been able to achieve its dispatch target for the month. The company's coal offtake grew by 5.4% YOY to 39.8 MT. Supply of coal to power utility companies increased by 10.2% YOY to 29.6 MT in April. CIL's stock is marginally up.
Auto stocks are trading mixed with Escorts and Maharashtra Scooters leading the gainers and Ashok Leyland and Tube Investments leading among losers. As per a leading financial daily, according to the automobile company Mahindra and Mahindra (M&M), the government's decision to impose higher tax on SUV (sport utility vehicle), is changing the competitive scenario. Reportedly, as per the current definition for SUVs the ground clearance attracts tax rate of 30% against 27% earlier. Most of the vehicles of M&M are now falling under higher excise duty. However, some multipurpose vehicles of Maruti Suzuki have escaped higher tax burden. Reportedly, according to M&M president Pawan Goenka, as per initial analysis the industry sales of SUVs on which excise duty has been increased by 3%, have gone down by 14% during April 2013, compared to the previous year. This was as against the growth witnessed in April 2012 at 24%. The stock of M&M was trading up by 0.1%.