Inflation Worries in India, L&T Up

Chandrasekhar Atreya
15 Jul, 2010
New York City

Stocks in Mumbai fluctuated and ended lower. The latest read on inflation showed another increase Tata Power

[R]5:00 PM Mumbai, 8:30 AM New York – Stocks in Mumbai fluctuated and ended lower. The latest read on inflation showed another increase Tata Power’s wind power project gets carbon credit eligibility. Tea production in Assam may be sharply curtailed. Nissan launches compact car Micra. L&T wins Hyderabad Metro project.[/R]

Stocks in India fluctuated and ended lower. The Sensex Index in Mumbai declined 0.16% or 28.70 to close at 17,909.46.

The wholesale price index in India increased 0.1% to 306.2 from 306.0 for the previous week. For the year ending in the week average inflation surged to 16.25% compared to 6.38% in the same period a year ago.

IPOs in India are expected to more than double in 2010 as the market stabilizes and state-run companies go public. The nation will complete about 50 IPO offerings this calendar year, James E. Shapiro, the bourse’s head of marketing department of the National Stock Exchange said in Singapore today.

“There is definitely a long queue of government companies who have announced their intention to sell stakes and become publicly traded companies,” said Shapiro in a Bloomberg Television interview.

The Indian unit of Citigroup Inc sold Rs 500 crore of mortgages to Religare Enterprises Ltd, the financial services arm of Super Religare Ltd.

The acquisition, made through Religare Finvest Ltd, is expected to be completed in a month, said the CEO, Kavi Arora, of the New Delhi-based buyer today. The Indian unit of Citigroup has more than Rs 40,000 crore in loans, with mortgages of Rs 9,000 crore, Abhijit Sen, CFO of Citigroup’s South Asia unit said.

Tata Power Co’s 50-megawatt wind power project in Maharashtra state, registered with the UN Clean Development Mechanism, won eligibility to earn carbon credits.

The venture is expected to earn 85,000 Certified Emission Reductions annually, Tata Power said. When awarded those CREs would be valued at 1 million euros based on yesterday’s closing benchmark price of 11.95 euros a ton of carbon dioxide on the European Climate Exchange in London.

Tea production in Assam will decline this year because of pest attacks, driving prices higher, the state-run Tea Board of India said.

Production in Assam, which accounts for more than half the nation’s output, may drop 30% to 40% during the so called second flush, Chairman of the Tea Board, Basudeb Banerjee, said in a phone interview from Kolkata yesterday.

Monsoon rainfall, India’s main source of irrigation, may remain subdued over the grain and sugar cane growing regions during the next week or so, a weather bureau official said.

“The central and northeastern states, the main soybean, paddy, and tea growing regions may see enhanced rainfall during the next two to three days, Medha Kole, a Director at the India Meteorological Department said in her phone interview.

Japanese automaker Nissan on Wednesday announced the commercial launch of its compact car Micra, aggressively priced between Rs 3.98 lakh and Rs 5.29 lakh, a move that could intensify the price war in the premium hatchback segment.

The nation-wide sales of Micra, which has received over 2,000 bookings, will commence from Thursday. Micra is produced at the Chennai plant through joint venture with Renault Nissan Automotive India Pvt Ltd.

State Bank of India and the State General Reserve Fund of Oman on Wednesday signed an agreement to set up a joint investment fund with an initial capital of $100 million to invest in Indian projects.

The agreement was signed by SBI Chairman O.P. Bhatt and SGRF Chief Executive Warith Al-Kharusi in the presence of Finance Minister Pranab Mukherjee and Oman’s Minister of National Economy Ahmed Macki.

Larsen & Toubro Ltd was selected as the lowest bidder for the Rs 12,312 crore Hyderabad Metro project.

According to the state government, L&T quoted the lowest viability gap of Rs 1,800 crore, surpassing other bidders like Reliance. Viability gap means the government extending financial support to a project for making it economically viable. The metro project will be 71 kilometer with 66 stations. Out of eight bidders who were pre-qualified only three could meet financial closure for the tender.

LIC Housing Finance Ltd said its first quarter profit was Rs 212 crore compared with a profit of Rs 124 crore a year earlier, according to a filing with the Bombay Stock Exchange today.

Axis Bank said its first quarter profit was Rs 742 crore, according to the filing of the company with the National Stock Exchange today.

Indian Oil Corp, India’s second-biggest refiner, is planning to acquire oilfield assets in Africa as part of its overseas investment plan, its Chairman said.

“Africa is our top destination to buy assets because of its proximity to India and the good quality of crude that is available there,” Brij Mohan Bansal said in an interview at his office in New Delhi today.