The benchmark indices in the Indian stock market languished in the red throughout the session today with energy and realty stocks featuring amongst the top losers. The RBI's governor's statement with regard to unreliability of industrial growth (IIP) and inflation (WPI) data further clouded sentiments. While the BSE-Sensex closed lower by around 70 points (down 0.4%), the NSE-Nifty closed lower by around 18 points. The BSE Midcap and BSE Small cap indices maintained status quo. Barring auto and banking stocks, profit booking were seen across sectors.
As regards global markets, Asian indices closed weak today while European indices have opened on a mixed note. The rupee was trading at Rs 44.40 to the dollar at the time of writing.
As per GAIL, the country's largest gas transmission company, its investment in West Bengal to bring gas pipeline to Haldia and acquire Greater Calcutta Gas Supply Corporation will be delayed. With capex outlay to the tune of Rs 272 bn for the next three years, GAIL plans to double the transmission network by FY13. The company has also signed a MOU for setting up of gas based combined cycle power plants in Haridwar and Kashipur in Uttarakhand under joint venture route. Uttarakhand is facing power shortage and no new hydro plant is coming due to environmental issues and for improving availability of power in the state.
Meanwhile cement major ACC has reported growth of 6.2% YoY in its June 2011 cement production. Similarly, its dispatches for the month under review also surged by 7.3% YoY. The cement maker's cumulative production for the first six months of 2011 increased by 11.3% YoY while the dispatches grew by 11.9% YoY during the period. The cement sector in India are facing problem of huge overcapacity. In a bid to protect margins, the cement companies have decided to cut production so as to increase cement prices. The two key input costs for the cement industry, namely power and fuel, coupled with freight charges have seen an upward trend, on a per-tonne basis. In the case of power and fuel costs, cement companies have been grappling with a near 30% rise in coal prices. Thus while sales growth may come in line the companies may have to brace for lower margins this fiscal.