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BSE Sensex Trades Firm, Infosys up by 4.7%
Fri, 25 Nov 01:30 pm

After opening the day on a flattish note, the Indian share market have surged and the BSE Sensex is trading higher by 305 points (up 1.2%). NSE Nifty too is trading higher by 108 points (up 1.4%). The BSE Mid Cap and BSE Small Cap index are trading higher by 1.1% and 1.6% respectively.

Sectoral indices are trading in green with stocks from information technology sector are witnessing maximum buying interest. Stocks from IT sector have surged as the rupee hit an all- time low of 68.86 in yesterday's trade. This will be beneficial for the IT companies as most of their services are exported to the United States of America.

Gold prices, per 10 grams, are trading at Rs 28,440 levels. Silver price, per kilogram is trading at Rs 40,026 levels. Crude oil is trading at Rs 3,257 per barrel. At the time of writing, the rupee was trading at 68.65 to the US$.

As per an article in Livemint, US drug regulator has found seven breaches of manufacturing standards at Sun Pharmaceutical's formulation plant in Mohali, Punjab. This facility formerly belonged to Ranbaxy Laboratories. Moreover, this facility has been under an import alert ban since 2013.

Reportedly, the US drug regulator inspected the Mohali plant between 7 November and 16 November. Post the inspection; the drug regulator issued a Form 483, citing four deviations from the norms. Experts believe that barring one, the rest three deviations are not severe in nature.

Ranbaxy's units at Dewas, Panota Sahib and Toansa are also under the US FDA import alert. This bars drugs manufactured in these plants from being sold in the US.

Currently, the company is not only finding it difficult to resolve compliance issues at Ranbaxy's plant but also finding it increasingly difficult to resolve issues at its own manufacturing facility at Halol and Kharkhadi in Gujarat.

Recently the company declared its results for the quarter ended September 2016. The company's gross sales grew by 13.2% YoY during the quarter. The sales grew on the back of a good performance from Indian as well as US geography. Sales in the US geography grew by 9% YoY in dollar terms.

However, the main over hanging regulatory issue pertaining to its Halol plant has not been cleared yet. The company has addressed all concerns as pointed by the US FDA and have taken appropriate remedial measures. Once the plant is compliant again, it will be a huge positive for the company. The share price of Sun Pharma is trading higher by 3.3%.

In another news update, housing prices in 42 major cities in India could drop by up to 30% over the next six-twelve months. This is on account of the recent drive of the government to demonetize the 500 and 1000 currency notes.

Typically, real estate throughout the length and breadth of India is bought using black money. A significant part of the payment is made in cash. A Clampdown on black money by demonetization of the 500 and 1000 rupee notes should put pressure on the real estate prices as the demand fades away.

Here is Vivek Kaul's take on whether real estate prices would crash or not!

"Experts are of the view, that the Modi government's crackdown on black money is likely to lead to real estate prices coming down significantly.

The logic is that with Rs 500 and Rs 1,000 no longer being legal tender, it will become difficult to make the black component of the payment using currency notes. With the cash component becoming difficult to pay, it is expected that the real estate companies and builders will have to cut prices.

This is the logic being offered by experts who are forecasting a fall in real estate prices. How do I see the situation? Given that I have been bearish on real estate for as long as I have been, it would be easy for me to say that prices will crash. But the past data (whatever limited data we have on real estate) doesn't suggest the same.

So, my feeling is that real estate prices will fall, but whether they will crash or not, depends on how the government reacts to the situation. Allow me to explain."

Read his full explanation to whether the real estate prices will crash and the impact of demonetization in the real estate sector.

Vivek Kaul has also come out with a special report on how demonetization can have an impact on your investments, properties and effectively your wealth. It's a mind boggling read and you can claim this copy for free.

For information on how to pick stocks that have the potential to deliver big returns, download our special report now!

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Nov 24, 2017 (Close)