Sensex Gains 1%; Monsoon Rain Lags 15%

Mayank Mehta, Chandrasekhar Atreya and Sanjay Barot
30 Jun, 2010
New York City

Stocks in Mumbai traded higher and closed up for the sixth quarter in a row. Gold import in 2010 is expected to drop as much as 40%. Monsoon rains in June are 15% below average. Sumitomo Financial acquires 4.5% stake in Kotak Mahindra Bank Ltd.

[R]5:00 PM Mumbai, 8:30 AM New York – Stocks in Mumbai traded higher and closed up for the sixth quarter in a row. Gold import in 2010 is expected to drop as much as 40%. Monsoon rains in June are 15% below average. Sumitomo Financial acquires 4.5% stake in Kotak Mahindra Bank Ltd.[/R]

Stocks in Mumbai traded lower in the early trading in sympathy with Asian markets weakness but closed higher after a rally in the afternoon.

The Sensex Index in India gained 0.95% or 166.81 to close at 17,700.90 and CNX Nifty index rose 25.15 or 0.48% to 5,281.30. Among the Sensex 30 stocks, 16 rose and 14 fell.

On BSE trading, 1,446 stocks advanced, 1,343 declined and 109 were unchanged. Reliance Industries held firm. Consumer goods stocks and oil exploration and capital goods stocks rose.

Rupee edged lower 16 paisa to Rs. 46.64 against one dollar.

India’s import of gold is likely to fall by 40% in 2010 from the high of 343 tons last year as price of this precious metal keeps rising, according to an interview by the Bombay Bullion Association president Suresh Hundiya.

Spot prices of gold in Mumbai which were at Rs 14,800 per 10 grams last July have gone up to record Rs 19,000 per 10 gram recently.

Rains from monsoons were 15% below average until yesterday, according to the weather office in India.

The nation received 132.5 millimeters of rain in June till 29, the India Meteorological Department said on its Web site today. The normal for this period is around 155.3 millimeters of rainfall.

GTL Infrastructure Ltd, the company that has agreed to acquire Reliance Communications towers, is interested in more acquisitions as competition pushes this sector to a consolidate mode.

“If any existing tower company came in for acquisition and if that made business sense, we’d look at it,” said the company’s Chairman Manoj Tirodkar in an interview in Mumbai yesterday.

Sumitomo Mitsui Financial Group Inc, Japan’s second-largest bank by market value, said it is planning to acquire 4.5% of India’s Kotak Mahindra Bank Ltd, as it plans to boost overseas investment and increase banking profit between 20% and 30% this year.

The Tokyo-based bank will spend as much as $295 million to acquire a stake in Kotak Mahindra Bank Ltd and close the deal by September, Sumitomo Mitsui said in a statement posted on its Web site today.

Oil and Natural Gas Corporation along with its partners will sign contracts for half of the 34 oil and gas blocks awarded in the latest round of auction under the New Exploration Policy on Wednesday.

For the 24 deep water blocks that were on offer, only eight received bids, all of which were single bids. ONGC and partners received seven of those while Cairn Energy won one block. Similarly, for the 28 shallow blocks on offer, only 13 received bids. ONGC won five of these as lead partner and one with Oil India Ltd as the lead partner. BHP Billiton got three blocks and Cairn Energy one, a KG Basin offshore block.

Alembic Ltd has announced a reorganization of its business which consists of demerger of its core pharmaceutical business into a 100% subsidiary company, Alembic Pharma Ltd.

In the scheme of arrangements approved by the board on Tuesday, the company proposes to demerge its domestic formulation, international generic and active pharmaceutical ingredients business to its subsidiary Alembic Pharma Ltd. Alembic shareholders will get one share of Alembic Pharma for every share held of the parent company.

Gainers & Losers

Alembic Limited fell 0.8% to Rs 54.70 after the company announced reorganization of its business which consists of demerger of its core pharmaceutical business into a separate subsidiary.

Alstom Projects India rose 2.7% to Rs 669 after the company won Rs 458 crore order from Bharat Heavy Electricals.

Asian Paints Limited fell 2.2% to Rs 2,305.00 after turning ex-dividend for a dividend of Rs 18.50 per share for the year ended March 2010.

AstraZeneca Pharma India surged 12.0% to Rs 1,324.60 after the company''s board approved a proposal for delisting its shares from the stock exchanges.

City Union Bank rose 1% to Rs 35.75 after the bank''s board approved raising up to Rs 300 crore via qualified institutional placement.

Infrastructure Development Finance Company Limited added 4.3% to Rs 179.50 after the company raised $575 million, or about Rs 2,700 crore, from a qualified institutional placement.

Kotak Mahindra Bank Limited advanced 2.9% to Rs 769.00 after SMBC, a unit of Sumitomo Mitsui Financial Group Inc said it will acquire 4.5% stake in the Bank.

Nakoda rose 6.3% to Rs 14.06 after reports indicated the company has bought a polyester plant for a total investment of $40 million from South Korean firm Kyunghan Industry Company.

Patni Computer Systems Limited added 1.5% to Rs 512.10 after the company''s American depository receipt tumbled 8.49% to $21.45 on the New York Stock Exchange on Tuesday, June 29.

Reliance Industries Limited rose 1.2% to Rs 1,081.00 after Mukesh Ambani is close to signing an equal joint venture with U.S. private equity and hedge fund giant D.E. Shaw to enter the financial services sector, the Economic Times reported.

Subros Limited rose 0.8% to Rs 45.70 after the company formed a joint venture in India with Japanese firm Denso Corp to design automobile air conditioning systems and other devices.

Sundaram Finance rose 1.1% to Rs 462.20 after the company''s board approved acquiring BNP Paribas'' 49.9% shareholding in both Sundaram BNP Paribas Asset Management Company and Sundaram BNP Paribas Trustee Company.