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Indian market indices open weak
Fri, 1 Jun 09:30 am

Asian stock markets have opened the day on a mixed note with stock markets in Taiwan (down 1.4%), Japan (down 0.7%) and Singapore (down 0.6%) leading the losses in the region. However, markets in China (up 0.4%) and Hong Kong (up 0.2%) are trading firm. The Indian equity market indices have also opened the day on a negative note. Stocks in the IT space are leading the pack of losers. However, consumer durables and banking stocks are trading in the green.

The Sensex today is down by around 19 points (0.1%), while the NSE-Nifty is down by around 5 points (0.1%). However, mid and small cap stocks are trading in the green with the BSE Mid cap and BSE Small cap indices up by around 0.1% and 0.2% respectively. The rupee is trading at Rs 56.01 to the US dollar.

Auto stocks have opened the day on a mixed note with Tata Motors and Eicher Motor trading firm. However, Maharashtra Scooters, Bajaj Auto and Hero MotoCorp are facing selling pressure. Despite fears of slowdown in the auto industry, India's largest utility vehicle maker Mahindra & Mahindra (M&M) seems to be bullish on the growth front. It expects sales to grow by 10-12% in the financial year 2012-13 (FY13). However, the company rang the caution bell as far as the tractor segment is concerned. From earlier forecasts of 10-12% growth, it has lowered its growth expectations in this segment to 5-6%. The company is planning to launch 6 new models in the current fiscal, though it has not disclosed details pertaining to the new models and their launch dates yet. Over the next three fiscals, M&M has chalked out capital allocation of Rs 50 bn. In addition, the company would invest another Rs 25 bn in group companies over the same period.

Mining stocks have opened the day on a mixed note as well with National Mineral Development Corporation (NMDC), and MOIL Ltd trading firm. However, Sesa Goa Ltd and Coal India Ltd (CIL) are facing selling pressure. As per a leading financial daily, CIL has written a letter to Coal Ministry informing it of its decision to exit International Coal Ventures Limited (ICVL) consortium, a special purpose vehicle (SPV) that was incorporated in 2009 to acquire coal mines overseas. ICVL is a joint venture (JV) between Steel Authority of India Ltd. (SAIL), CIL, NMDC and National Thermal Power Corporation (NTPC). CIL has a 28% stake in the JV. As per industry sources the Board has decided to exit ICVL as it involved too much financial burden without commensurate advantage. ICVL has not made any success since its incorporation. NTPC is also willing to walk out of the consortium.

In a separate development, CIL has decided to increase prices of coal produced by its subsidiaries- Western Coalfields (WCL) and Eastern Coalfields (ECL). The move aims to compensate ECL and WCL for an adverse impact of new system of grading coal based on gross calorific value (GCV). The move will increase prices and add to the revenues.

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Feb 21, 2018 01:27 PM