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The major Asian equity markets have opened the day in red with stock markets in China (down 1.7%) and Korea (down 1.8%) being the top losers. Major stock indices in Europe ended their previous session in red. However, benchmark indices in US closed marginally higher. The rupee is trading at 66.35 per US dollar.
Indian stock markets have opened the day on a flattish note. BSE-Sensex is trading higher by 15 points (up 0.06%) and NSE-Nifty is trading lower by 14 points (down 0.2%). Both S&P BSE Midcap and S&P BSE Smallcap have moved upwards and are trading higher by 0.3% and 0.4% respectively. Major sectoral indices have opened the day on a mixed note. Stocks from capital goods and automobile are witnessing maximum buying interest. However stocks from oil and gas and telecommunication are the top losers in the pack.
As reported in a leading financial daily, Maruti Suzuki intends to invest Rs 150 bn. The money will be utilized for procuring land for dealership network and expanding its stockyard, warehouse and transportation infrastructure.
The investment is in sync with the company's aim to increase its annual sales to about 2 million units by 2020. Further, once Gujarat plant gets operational it will help in doubling its sales. Thereby additional dealership network will be required to sell these manufactured products. Reportedly, company has a dealership network of 1,700 outlets. The company intends to double its dealership network in the next 5-6 years.
The expensive land cost is making it difficult for the dealers to invest in land. Hence, company will purchase the land for the dealers to set up their showroom. The land parcels procured by the company will then be leased to dealers who will in turn pay rents to the company. Going forward too, company intends to set up future dealerships on the land owned by the company.
Maruti Suzuki is trading up by 1.5%.
As per an article in Livemint, there appears to be no signs of revival in the tractor sales. Reportedly, sales volumes in the tractor segment contracted for the 13th consecutive month. Sales data for October showed a contraction of sales by 19.5%.
The main reason for a drop in the tractor sales is weak monsoon. Further, minimum support prices for the crops have not increased significantly, leading to low disposable income in the hands of the farmers. These factors have impacted revenues of the companies such as Mahindra and Mahindra. The company has reported a drop in sales from farm equipment by 26% YoY, for the Sept quarter. Further Escorts too reported a drop in their sales by 20% on a YoY basis.
Going forward, recovery in tractor and farm equipment looks bleak in the second half of 2015-16.
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