The BSE-Sensex is trading up by 121 points while NSE-Niftyis trading 29 points above Friday's closing. The BSE-Midcap and BSE-Small cap indices are up by 0.4% and 0.8% respectively. The rupee is trading at 45.83 to the US dollar.
Pharma stocks have been trading mixed with Orchid Chemicals, Panacea Biotec and JB Chemicals leading the pack of gainers. However, Aurobindo Pharma and Torrent Pharma are trading weak. As per a leading financial daily, Cipla and Dr. Reddy's Laboratories have been sent show cause notices by the country's drug regulator for selling drugs that were banned by the government. It is planning a similar action against few other top drug makers. As per a health official, while Dr. Reddy's has asked more time to respond, Cipla is yet to answer a few more queries on the issue. Dr. Reddy's spokesperson has said that it has withdrawn its gatifloxacin brand immediately upon notification on the ban of the drugs. The chemists and drug outlets have been asked not to sell stocks of prohibited drugs. The Drug Controller General of India has already initiated actions against the chemists and is now probing the role of companies in the violations.
The drug regulator is still waiting for responses from all the companies concerned. If it finds them to be unsatisfactory, it will start prosecutions against the firms by October. The guilty officials of the respective firms may face a two year jail term under the country's laws if found guilty.
Hotel stocks have been trading mixed as well with Country Club and Indian Hotels leading the pack of gainers. However, Orient Hotels and EIH Hotels are trading weak. As per a leading financial daily, ITC Hotels and Tata's Indian Hotels are competing for more market share in the hotels segment. On the back of expanding tourism industry and expanding market, both are expected to add 40 odd properties in the next two years. ITC is planning to start at least 40 hotels in the next few years. These are under various stages of development and would take ITC's total to 150. The Tata group-promoted Indian Hotels Company Ltd (IHCL), of which Taj is a part, at present has 109 properties in India and abroad. It aims to add 41 in the next four years. ITC, which has all its hotels in India, already has the biggest domestic tally of 110. ITC is investing Rs 90 bn over the next few years on the same project. IHCL, despite a consolidated debt of Rs 32 bn, would be adding 27 new properties. The company would not be opening any properties under the Taj brand in the domestic market till 2013. Two new Taj properties would open in Morocco.