The Indian markets continued to languish in the red during the post noon trading session. Heavyweights from the telecom and IT sectors are amongst the top underperformers at the moment, while those in the metal and realty spaces are finding favour from investors.
The Sensex today is trading lower by about 50 points (down 0.3%), while NSE-Nifty is trading lower by about 15 points (down 0.2%). Stocks from the midcap and small spaces are however in favour today with the BSE Mid Cap and the BSE Small Cap indices up by 0.6% each. The rupee is trading at 54.69 to the US dollar.
Auto stocks are currently trading on a high note with the stocks of Maruti Suzuki, Bajaj Auto and Mahindra & Mahindra leading the pack of gainers. As per a leading daily, the Tata Group Chairman, Mr Ratan Tata has stated that he does not plan to move the production of Jaguar and Land Rover (JLR) to India. The reason for this is the tax structure. The taxes and duties in India make assembly even costlier than imports. Instead Tata Motors are planning to set up a plant in China to manufacture these cars which will be exported all over the world. Currently JLR does not have the scale of manufacturing. It is able to sell 1,000 Jaguar cars a year. As per Mr Tata manufacturing needs to be expanded by nearly four to five times to justify Tata Motors' investment.
Telecom stocks are currently trading weak with Bharti Airtel and Idea Cellular leading the losses. As reported by a business daily, the GSM Association believes that India is no more an attractive telecom market for global players. A key factor for the same is the uncertain regulatory environment. The body's rationale behind the same is that quite a few foreign acquisitions and investments are taking place across the globe, but there is no focus on India, especially compared to how it was a few years ago. Further, the companies in India are themselves looking to expand operations in countries across the world, despite the overalls lowdown, which is another indication towards the same. Some of foreign opportunities include Burma, a region that is attracting a lot of interest.