Indian share markets remained volatile but managed to bounce back into the positive territory in the post-noon trading session. Barring IT and capital goods, all the sectoral indices are trading in the green with power and consumer durable stocks being the biggest gainers.
Most of the auto stocks are trading in the green with TVS Motors and Mahindra & Mahindra (M&M) being the major gainers, whereas Eicher Motors and Escorts are trading in the red. As per a leading financial daily, the joint venture company of Eicher Motors and Volvo, VE Commercial Vehicle, is contemplating entry in the small commercial vehicle segment by launching a range of mini trucks. Currently, Eicher has a presence in trucks having gross vehicle weight of 5-49 tonnes. The company is evaluating the viability of foraying into trucks weighing 1-3 tonnes where it will compete with the likes of Ashok Leyland's Dost, Tata Motor's ACE and Mahindra's Maxximo Plus. The company is likely to arrive at a decision over the next 3-6 months and the trucks may be launched in FY17. Eicher is also studying the possibility of setting up a new plant at Mandideep in Madhya Pradesh to service the new segment. This is the third time that the company is trying to enter the small commercial vehicle segment. The evolution of the hub and spoke model is driving overall demand for small commercial vehicles in cities. Eicher Motors stock is trading down 2.2%.
Indian Pharma stocks are trading mixed today. While Cadila Healthcare and Torrent Pharma are trading weak, Sun Pharma is leading the pack of gainers. As per a leading business daily, Sun Pharma has entered a settlement pact with Novartis in the US over a cancer drug. Both companies were in a legal dispute in the US over the generic version of Novartis' patented cancer drug, Gleevec. Sun Pharma had applied for marketing rights for the cancer drug in the US in 2007 but was denied approval. So under the settlement terms, Sun Pharma's US subsidiary is expected to launch the medicine in the US in February 2016. The subsidiary holds tentative approval from the US FDA for the abbreviated new drug application (ANDA) for a generic version of Gleevec. Reportedly, Novartis' Gleevec sales were about US$ 2 bn in the US in 2013. This is a positive for Sun Pharma and will help enhance sales and profits from the highly competitive US market.