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Indian Stock Market News, Equity Market and Sensex Today in India | Equitymaster
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Markets below 17,000 on global woes 
(Mon, 7 Jun 11:30 am) 
 
Indian indices have been languishing in the red during the past 2 hours of trade on the back of profit booking in heavyweights. Stocks from realty and metal space are seeing heavy selloff. The decline to advances ratio is 3:1.

BSE-Sensex is down by 381 points while NSE-Nifty is trading 116 points below Friday’s closing. BSE-Midcap index and BSE-Smallcap index are both trading down by 1.6%. The rupee is trading at 47.26 to the US dollar.

Reliance Communications is one of the few stocks trading firm in an otherwise declining market. This is on the back of the board giving an approval for divestment of a 26% stake in the company. This stake may be sold to a so far unknown strategic or private equity investor. Last week there were talks about a possible merger with the South African MTN or a stake sale to Dubai-based Etisalat. The company is in desperate need for cash to fund growth especially post the expensive 3G auctions. The company has a massive net debt of Rs 199 bn at the end of FY10 to pay off. According to a leading business daily, the company will need to issue 516 m shares to dilute the 26% stake. The valuations of the stake sale are so far undisclosed.

Auto ancillary stocks are currently trading weak led by Exide Industries, Bharat Forge and Mahindra Forgings. A leading business daily has reported that auto ancillary major Bharat Forge along with small sized IT player KPIT Cummins have developed a technology which would help improve fuel efficiency of vehicles. This technology is called ‘Revolo’, which is a new revolutionary battery-powered technology. The joint venture company formed by these two companies would be commercialising this technology within six months.

As per the companies, this technology would allow to improve efficiency by about 40% as compared to a standard fuel-consuming engine. This technology is what is used in hybrid vehicles, which even though is at a nascent stage in India, is fast picking up. For a consumer to use the same, he would be required to install a kit in his vehicle. It is believed that installing such a kit in Europe would cost about 10,000 Euros. However, these companies are likely to sell this kit at a discount of 85% to the same. The companies will be targeting the vast after sales Indian market at first.

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1 Responses to "Markets below 17,000 on global woes"

mani

Jun 7, 2010

good

good

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