As regards to global markets, Asian indices closed on a mixed note, while European indices opened firm. The rupee was trading at Rs 60.10 to the dollar at the time of writing.
Oil & Gas stocks ended the day on a mixed note. Gujarat State Petronet and Castrol closed higher while Essar Oil closed in the red. In an unprecedented move the government is planning to set gas prices in Rupees instead of Dollars in order to eliminate the influence of exchange rate. This proposal has come a few days after government decided to delay the gas price hike for a period of 3 months. It may be noted that the Rangarajan formula, based on which the hike was conjectured, is complex in nature. And the new government needed some time to analyze the same, considering the issue is politically sensitive in nature. While it is difficult to comment on the extent of hike the fact remains that India's oil & gas sector is facing dearth of investments. The reason is inappropriate returns due to controlled pricing regime and highly capital intensive nature of the industry. As such, we believe that government should take steps to promote investment in the industry and gradually de-control the prices in a staggered manner so that the common man is not burdened by sudden rise in prices. Do you think that such a decision will revive interest in oil & gas stocks? Let us know your comments or share your views in the Equitymaster Club .
Majority of the Indian pharma stocks ended the day on a firm note with Panacea Biotech and Divis Laboratories being the leading gainers. Dr Reddy's has announced that the company has launched generic version of Cymbalta in the US market. The said drug was approved by the United states Food and Drug Administration (USFDA) in December 2013. The branded market size of the drug is $5.04 bn per annum. Cymbalta is generically known as duloxetine delayed released capsules and is indicated for depressive disorder, general anxiety disorder and fibromyalgia. Other than Dr Reddys, various other companies hold approval for the said drug. It may be noted that there are already many players in the market since as companies have already launched the drug since December 2013. Indian companies like Sun Pharma,Lupin, Alembic Ltd have already launched the drug and have sufficient market share, Thus the upside for Dr Reddy for this drug will seemingly be limited.Dr Reddys closed up by 1.86% today.