Heavyweights continued to support market gains as the Indian stock markets continued their journey in the positive zone over the last two hours of trade. Stocks from the PSU, Oil & Gas and Auto space are the main gainers. However, stocks from consumer durables space are trading in the red.
The BSE-Sensex is trading up by 224 points while NSE-Nifty is trading 75 points above the dotted line. The BSE Midcap and BSE Small cap indices are up by 1% each. The rupee is trading at 45.06 to the US dollar.
Power stocks are currently trading on a positive note with Power Grid Corporation, CESC Ltd and Reliance Power leading the pack of gainers. However, Reliance Infrastructure is trading weak. As per a leading financial daily, Coal India Ltd (CIL) in its first official response to the power ministry's demand of temporarily stopping spot sales of coal has said that the move will fail to boost availability at power stations. The company has a monopoly in coal production in India and it has suggested that restricting e-auction sales would rather push up inventory at its mines and aggravate coal shortage. The company in a letter to the coal ministry has said that restriction of e-auction will result in accretion in pit-head coal stock to the tune of 8% of the overall production. This is because around 80% of the e-auction (8% of the overall production) is under taken by road which normally cannot move to power stations. The company had sold 43 million tonne (mt) of coal through e-auction last financial year at a price 83% over the notified price. It has currently got a total of 70 mt of inventory at its mines versus an estimated shortage of 83 mt in the country this financial year. The company attributes shortage to unavailability of railway rakes for dispatch. The stock of the company is trading firm.
Engineering stocks are trading mixed led by Alstom Projects, Cummins India and KSB Pumps. AIA Engineering and Voltamp Transformers are trading in the red. As per a leading financial daily, Larsen and Toubro Ltd has plans to set up another 2000 MW power plant and a 3 m tonne steel plant in Orissa at a combined investment of Rs 300 bn. This along with earlier plans of Rs 440 bn alumina and aluminium plant and Rs 110 bn power project in Orissa have raised the company's total investment in the state to around Rs 850 bn. The company's new power plant would also involve state government association and a contribution of Rs 100 bn. The project would require about 1,200 acres of land. For its 3 m tonne steel plant and a captive power plant near Paradip, the company has already identified 600 acre of land. Once a memorandum of understanding is signed with the Orissa government, the company would start work on the plant. The stock of the company is trading in the green.