Indian stock markets indices have given up their early gains and are trading flat over the last two hours of trade. Auto and Realty stocks witnessed maximum selling pressure while Oil and gas and IT stocks witnessed maximum buying interest.
Mining stocks are trading in the red led by Metals and Minerals Trading Corporation of India Ltd. (MMTC) and Sesa Goa Ltd. According to a leading financial daily, Coal India has entered into a new price regime which will be effective from January 2, 2012. Under the new price regime, the company has shifted to international pricing which will benchmark coal prices on the basis of gross calorific value (GCV) and prices of coal will be 30 to 60% higher than what the state-run firm's average price used to be. Based on the new mechanism, there would be at least 17 slabs of 300 kilocalorie (kcal) bandwidth, starting from 2,200 kcal to 7,000 kcal, and above 7,000 kcal. The pricing of the present A and B grade coal would almost be the same, while E, D and C grade coal prices would increase slightly. F and G grades would almost be the same. For Coal India, a majority of coal comes under the F and E category. However, the company is to still maintain the differential pricing system and discounts. The discounts to customers would range from 25 to 77%, while it was 20 to 77% in the earlier price regime. Hence, there will not be too much of impact for the power sector in the country.
Auto stocks are mainly trading in the green led by Mah Scooters and Tata Motors (Telco). As per a leading daily, Tata Motors's sales of commercial and passenger vehicles rose by 22% in December 2011. The domestic sales were up by 24% while the exports witnessed a fall of around 200 vehicles from 5809 in December 2010. Light commercial vehicles sales too grew by 20% as compared to December last year. Medium and heavy commercial vehicles saw a slow growth of only 5%. However, the highest growth was in the passenger segment which grew by 47% over last December. Sale of Jaguar Land Rover has also been substantial and is growing continuously.