Indian stock market traded firm in the last two hours of trade on the back of sustained buying activity across index heavyweights. Stocks from the FMCG and capital goods
space are leading the pack of gainers.
The BSE-Sensex is trading up by 178 points while NSE-Nifty is trading 51 points above the dotted line. Both BSE Midcap index and BSE Small cap
index are up by 0.7% and 1.0% respectively. The rupee is trading at 44.44 to the US dollar.
IT stocks have been trading firm led by CMC Ltd. and Mahindra Satyam while Patni Computers and Tech Mahindra are trading in the red. As per a leading financial daily, Infosys and Wipro have not yet been granted land despite erstwhile Left Front government's tall claims. The decision now lies with Mamata Bannerjee and her government. The land has not been granted over to the companies because of the lack of infrastructure around it. The basic requirements for any IT company like high tension line, road and sewerage are all missing. The government had earlier claimed that 12,000 jobs would be generated by these two companies in two years. The two companies are now relying on the government's "political will" for the land. The stocks were trading in the green.
Aluminium stocks are trading strong with both Hindalco and Nalco trading in the green. As per a leading financial daily, the government will soon clear the uncertainty regarding Mahan coal block located in Singrauli fields in Madhya Pradesh, currently held by Mahan Coal Ltd, a joint venture company equally held by Essar Power and Hindalco Industries. The block is estimated to have 150 million tonne of thermal reserves and will feed upcoming power plants of Essar Power and Hindalco Industries. While Essar has an off take agreement of 60% or 5.4 m tonne per annum (mtpa) of coal from the block to feed its upcoming 1,000 MW power plant in the state, Hindalco will take the remaining to fuel its 750 MW power plant. Hindalco has an off-take agreement of 3.6 m tonne per annum of coal from the coal block. Hindalco's power plant will then supply captive power to its upcoming 359 kilo tonne per annum (ktpa) aluminum smelter called as the Mahan Aluminium project, which is likely to be commissioned by the last quarter of calendar 2011. If the block is not cleared, it could be a big negative for the company. However if it gets cleared, the company will see a huge cost reduction in alumina production.