The Indian stock market continued to trade weak on account of selling pressure in heavyweights during the last two hours of trade. All sectoral indices are trading in the red. Stocks from the oil & gas, power, banking, consumer durables and metal are leading the pack of losers.
The BSE-Sensex is trading down by 205 points while NSE-Nifty
is trading 63 points below Friday's closing. The BSE Mid Cap and BSE Small Cap indices are trading down by 0.8% and 0.5% respectively. The rupee is trading at 51.68 to the US dollar.
Engineering stocks have been trading mixed with Jain Irrigation, Elecon Engineering and Areva T&D leading the pack of gainers. However, Bharat Heavy Electricals Ltd (BHEL), EMCO Ltd and Havells India are trading weak. As per a leading financial daily, Larsen & Toubro (L&T) is targeting overseas revenue growth to counter the slowdown back home. The firm that gets over 80% of its revenue from India, slashed its order growth guidance for the financial year to March by a third to 5% last month on account of project deferrals , rising competition and sluggish investor appetite, a product of high interest rates and a gloomy economic outlook. As per the management, it plans to increase its revenue share from overseas projects to 15-20% from 10-12% currently. The firm has aggressively targeted overseas projects in recent months. It has announced US$ 1.1 bn worth of new foreign contracts, mainly for hydrocarbon firms in the Gulf region, since August. The stock of the company is trading in the red.
Energy stocks have been trading mixed as well with Gujarat Gas, Indraprastha Gas and Mangalore Refinery and Petrochemicals Ltd (MRPL) leading the pack of gainers. However, Gujarat State Petronet, Reliance Industries and Petronet LNG are trading weak. As per a leading financial daily, Petronet LNG promoters and Oil Ministry are in dilemma over the 5.2% holding being sold by Asian Development Bank (ADB). For this, the promoters and Oil Ministry have called a meeting to decide whether state companies should buy the same. It is important to note here that state run firms like Oil and Natural Gas Corp (ONGC), Indian Oil Corporation (IOC), Bharat Petroleum Corporation (BPCL) and Gail India together hold 50% stake in Petronet LNG. While promoting the company, the combined stake was intentionally capped at 50% so that it could be operated with the freedom that a private firm enjoys. Such freedom allowed the company to negotiate spot LNG prices in the international market. However, with ADB selling its stake and the state-run firms having the right of first refusal, it is likely that the company will soon become a Public Sector Undertaking (PSU).