Indian stock market indices traded firm over the last two hours of trade on the back of sustained buying activity across index heavyweights. Consumer Durable and Auto stocks witnessed maximum buying interest, while Realty and metal
witnessed maximum selling pressure.
Automobile stocks are trading strong. Apollo Tyres and Maruti Suzuki are the biggest winners, while Maharashtra Scooters and Eicher Motors are the biggest losers. According to a leading financial daily, Tata Motors is planning to raise US$ 750 m via external commercial borrowings External Commercial Borrowings (ECB) to meet working capital requirements and reduce debt. The ECB with a spread of 6 years will be priced about 350 basis points above London Interbank Offer Rate (LIBOR). This will be the second big ticket fund raising event for the company after its US$ 1.6 bn bond issue for Jaguar and Land Rover (JLR). The issue, completed in May, saw significant oversubscription from investors. The country's largest bank, State Bank of India, is one of the arrangers for the deal.
Banking stocks are trading in the green led by Punjab National Bank (PNB) and Canara Bank. Industrial Development Bank of India (IDBI Bank) declared results for the quarter ended September 2011. The bank reported 28% YoY and 20% YoY growth in interest income and net profits respectively. Net interest income (NII) remained stagnant in 2QFY12, despite a 20% YoY growth in advances. Capital adequacy ratio stood at 13.34% at the end of 1HFY12 from 14.17% at the end of 1HFY11. Cost to income ratio shrunk from 38% in 1HFY11 to 36% in 1HFY12. Net NPA (non-performing assets) to advances was slightly higher at 1.57% in 1HFY12 from 1.19% in 1HFY11. Net profit margin saw a decline in 2QFY12 and stood at 8.9% as compared to 9.5% in 2QFY11.