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The Indian share market has pared a small portion of its morning gains during the noon trading session but continued to trade well above the dotted line. Sectoral Indices are trading on a mixed note with stocks from metal & banking sector leading the gains. While oil & gas stocks are trading in the red.
The BSE Sensex is trading higher by 139 points (up 0.5%) while the NSE Nifty is trading higher by 34 points (up 0.4%). The BSE Mid Cap index is trading up by 0.2% and BSE Small Cap index is trading up by 0.7%. Gold prices, per 10 grams, are trading at Rs 29,932 levels. Silver price, per kilogram is trading at Rs 42,225 levels. Crude oil is trading at Rs 3,436 per barrel. The rupee is trading at 66.70 to the US$.
As per an article in The Economic Times, L&T Technology Services, an arm of Larsen and Toubro has secured a multi-million-dollar contract from a global semi-conductor company. The company will provide verification support on the client's expansive portfolio of offerings and products.
Reportedly, the tie-up will enable the customers strengthen their product offerings and capitalize on market opportunities with better quality products.
In another development, it was reported that, L&T Construction's Smart World and Communication Business Unit has signed the formal contract with the Department of Information & Technology, Maharashtra Government. Under this contract, Nagpur will be converted into the country's first large-scale integrated Smart City.
The scope of work will cover laying of 1200 km of optical fiber network backbone. Further it will creat 136 city Wi-Fi hotspots at key locations. It will also develop city surveillance systems with 3800 IP based cameras, the reports noted.
Diversification continues to help L&T (Subscription Required) negotiate and get better terms and margins for projects. Apparently, this is because it is less desperate to win orders as compared to a company which are present in only a couple of sectors. Its reputation, extensive technical prowess, and large skilled workforce have enabled L&T to command a certain premium from customers and vendors alike. Whether, further addition to these new projects provides a cushion to its profitability will be an interesting thing to watch out for going forward.
L&T's share price was Rs 1490.9 at the time of writing, up by 0.4%.
Moving on to news from stocks in auto sector. As per an article in a leading financial daily, Mahindra & Mahindra (M&M) announced that it will buy 60% stake in Classic Legends (CLPL) for Rs 60 million. The company has subscribed to and has been allotted 60, 00,000 equity shares of Rs 10 each of CLPL. It constitutes 60% of its post-issue capital, on the preferential basis.
CLPL is a Mumbai-based, unlisted company, belonging to the automobile industry. It is yet to start its commercial operations. It was incorporated in June last year and is not a related party of Mahindra & Mahindra.
Reportedly, this acquisition will allow CLPL directly as well as indirectly, manufacturing, marketing, sell as well as distribute two-wheelers globally by directly or indirectly obtaining license of brands.
One must note that, last month, it acquired in full the equity shares of Mahindra Two Wheelers Europe Holdings (MTWL Europe) from Mahindra Two Wheelers, which is a subsidiary company. MTWL Europe holds investment in two-wheeler company in Europe which is Peugeot Motorcycles S.A.S. The acquisition would facilitate better focus on downstream two wheeler business.
Shares of M&M were trading up by 0.1% at the time of writing.
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