Indian indices continue to languish in the red on profit booking in heavy weights over the last two hours of trade. Stocks from realty and banking space are trading in the red while stocks only from the IT space are trading in the green.
The BSE-Sensex is down by 166 points while NSE-Nifty is trading 55 points below the dotted line. BSE-Midcap is down by 0.5% while BSE-Smallcap index trading 0.4% below yesterday’s closing. The rupee is trading at 45.57 to the US dollar.
Auto stocks are trading weak with Maruti Suzuki and Ashok Leyland leading the pack of losers. However, M&M and Eicher Motors have registered decent gains. Bajaj Auto plans a massive distribution network expansion by adding 130 new dealerships and upgrading 1,100 service centers by the end of next festive season. These new dealerships would mostly be in small towns which will help the company to increase its share in these towns which are inadequately catered. The company is also working with a reputed international design agency to enhance the experience at its dealerships. Further, the company also plans to upgrade its service centers at an investment of Rs 180 m so as to improve service standards in these markets. Since a typical Bajaj dealership requires huge space and has a direct employment potential, this expansion drive is likely to create job opportunities in smaller towns
Textile stocks are trading weak led by Vardhaman Textiles and Alok Industries. As per a leading financial daily, retailer Arvind Brands, a subsidiary of Arvind Limited is planning to launch premium brands from the US and Europe for both women and youth by the middle of 2011. The company is not strong in women’s western wear and with this initiative, is planning to change that. It may be recalled that Arvind Limited had entered the women’s wear segment in 2005 through its brand Arrow. However, it was not a successful venture and the company withdrew from this segment in 2007.
As per a report by Technopak Advisors, the Indian textiles and apparel industry was worth Rs 2.2 tn in 2009 (branded apparel market worth Rs 600 bn). Men’s wear accounts for 43% market share, and growing at 9% YoY annually. Women’s wear is growing faster at 12% YoY annually and is expected to garner a market share of 43% by 2020.