The BSE-Sensex is trading lower by 12 points and NSE-Nifty is trading down by 6 points. However, BSE Mid Cap and BSE Small Cap indices are trading up by 0.3% and 0.4% respectively. The rupee is trading at 54.88 to the US dollar.
Engineering stocks are trading mixed with Everest Kanto Cylinders and Manugraph India leading the gains while TRF Limited and Kalpataru Power are witnessing maximum losses. As per a leading daily, Larsen & Toubro (L&T) has won new contracts worth Rs 25 bn in April and May. These contracts are for various business segments. While the building and factories segment has won orders of Rs 10 bn, the heavy civil infrastructure business has secured orders for the Kochi metro rail worth Rs 8.6 bn. L&T's transportation infrastructure segment has secured an order from Dedicated Freight Corridor Corporation of India Limited worth Rs 3.1 bn towards double tracking of a railway line between New Karwandiya to Durgauti section of the eastern corridor. Also, water and renewable energy business has received Rs 1.5 bn worth of order from the Public Health Engineering Department for water supply distribution. Besides, orders worth Rs 1.9 bn have been obtained for a project under the power business.
Pharma stocks are trading weak led by Glenmark Pharma and Piramal Enterprises. As per a leading daily, the Government of India has decided to bring down the prices of essential medicines as per the new norms in pharma industry. Also, the norms call for increasing the number of drugs under price control and change the method of regulating the prices. The new regime would be effective 45 days from now and the government would regulate the prices of 652 medicines. Earlier this number stood at only 74. We may note here that the new pricing regime would replace the 18 year old method of fixing prices on a cost-plus basis. Drugs will now be priced as per market price-linked cap for each drug.
The new norms are likely to impact the business of both Indian as well as multinational pharma companies. However, makers of niche drugs may not get affected. As per the industry experts, the companies that are likely to get hit are Glaxosmithkline, Sanofi Aventis, Cipla and Cadila.