The benchmark indices in the Indian stock market extended their gains in the last two hours of trade and are currently trading firm. All sectoral indices are trading in the green with FMCG, Banking and Metal leading the pack of gainers.
Pharma stocks are trading mixed with Lupin Ltd, Dr Reddy's Laboratories and Strides Arcolab leading the pack of gainers. However, Indoco Remedies and Dishman Pharma are trading weak. Lupin Ltd. has announced its results for 4QFY11. The company has reported 17.0% YoY sales growth during the quarter. The growth was mainly driven by the emerging markets including India. However, the operating margins contracted by 2% (as a percentage of sales) to 20.0% due to the increase in raw material prices and employee costs. The growth in net profits came at a mere 3% YoY led by decrease in the operating margins and fall in other income. The Board has recommended a 150% dividend of Rs 3 per share for the year.
Banking stocks are trading firm with Axis bank, IDBI Bank and UCO Bank leading the pack of gainers. However, Canara Bank is trading weak. As per a leading financial daily, Axis Bank has bought 4% stake in Max New York Life Insurance for Rs 0.7 bn. This implies a valuation of the life insurance company at Rs 18 bn. Axis bank and Max New York Life have a 10 year bancassurance agreement. Under the agreement, the bank will help to sell the insurer's products through domestic distribution channels. The deal will consolidate the distribution network for insurance company and increase fee income for the bank. Last year also, the bank had acquired investment banking and securities unit of Enam Securities Pvt Ltd in an all stock deal for Rs.20.7 bn in order to expand its broking and investment banking business.