Sensex Gains 1.2%; Bajaj Corp IPO Up 23%

Chandrasekhar Atreya
18 Aug, 2010
New York City

Stocks in Mumbai rose sharply higher as international funds flows increase. Regulators are looking to increase investment limit for retail investors in a public offering. Gujarat Pipavav will launch its public offering on August 23 and Bajaj Corp IPO surges 18% on the first day.

[R]5:00 PM Mumbai – Stocks in Mumbai rose sharply higher as international funds flows increase. Regulators are looking to increase investment limit for retail investors in a public offering. Gujarat Pipavav will launch its public offering on August 23 and Bajaj Corp IPO surges 18% on the first day.[/R]

Indian stocks rallied in the last trading session to rise more than 1% on Wednesday, with outsourcers leading and gains in the Asian markets.

The BSE Sensex Index added 1.15% or 208.27 to close at 18,257.12. Of the 30 shares in the index 23 closed higher and 7 declined.

Bajaj Corp listed on debut at a premium and gained as much as 23% to close at Rs 812 against the issue price of Rs 660.

Indian government is set to introduce a revised bill in parliament to cap liability for nuclear accidents, resolving a two-year standoff that’s kept companies like General Electric Co out of the country’s $175 billion atomic energy market.

According to the recommendations of a panel, Nuclear Power Corp of India will have to pay a maximum of Rs 1,500 crore in the event of an accident, trebling an earlier proposal. The state-owned operator may then seek damages from supplier if the equipment is found defective, the panel said.

Dr. Reddy’s Laboratories Ltd is in talks with three Japanese drug makers to buy a stake, according to information cited by ET Now television channel. The company spokesman S. Rajan said the company is in early stages of evaluating partnership options as part of the firm’s Japan entry strategy.

Foreign ownership of Indian stocks increased 16% this year to a record $84.5 billion according to data released by the Securities & Exchange Board of India. Their holdings of India’s debt also reached to record $15.8 billion.

The Indian rupee after strengthening the most in a fortnight on Tuesday, held its own, even as exchange data showed overseas investors added to their holdings of local stocks on all but one of the last 30 trading days ending August 16.

The India Commodity Exchange Ltd, founded by Indiabulls Financial Services Ltd and MMTC Ltd, said it may join forces with Reliance Industries as its seeks to expand the nation’s $1.7 trillion commodity futures market.

The India Commodity Exchange, which started operating in November is 40% owned by Indiabulls and 26% owned by state-run MMTC Ltd, according to details provided on the exchange’s Web site. “There is an alliance which is being discussed,” Ajit Mittal, a director at the exchange said today.

New York-based investment firm Blackstone Group LP, said it is acquiring a stake in Moser Baer Projects Pvt Ltd for $300 million, its largest investment in India. The company has so far invested $1.25 billion in 12 companies in India.

Blackstone will get a significant minority stake in the energy company, Akhil Gupta, Chairman of the private equity fund’s India operations, said in an interview today. He also said the company plans to invest in as much as $3 billion into India in the next five years, including $1 billion in power companies.

Moser Baer will use the funds in power projects, said Deepak Puri, Chairman of the company. He also said the company has plans to commission 4,000 megawatts of thermal power by 2016 and 1,000 megawatts of solar and hydroelectric power.

India’s capital market regulator Wednesday proposed raising the limit of investment an individual retail investor can make in a public issue to Rs 200,000 from the current Rs 100,000.

The Securities & Exchange Board of India issued a discussion paper on the proposed change and will seek comments from the public till September 3, it said on its Web site.

Wockhardt Ltd said Wednesday it plans to raise $74.09 million via foreign currency convertible bond issue in one or more tranches.

“The company proposes to restructure the existing FCCBs, and in this regard is considering various options including issuance of new FCCBs in exchange of existing FCCBs,” a company notice to shareholders for their approval said.

The Indian port operator and developer Gujarat Pipavav said Wednesday it had set a price range of Rs 42 to Rs 48 for its initial public offering to raise as much as Rs 500 crore. The offering is managed by Kotak Mahindra Capital, IDFC Capital and IDBI Capital will open on August 23 and close on August 26.

Gainers & Losers

Arshiya International Limited gained 3.7% to Rs 292.95 after the supply chain and logistics infrastructure developer said its free trade and warehousing zone in Mumbai became operational from today.

Bajaj Hindustan Ltd rose 0.3% to Rs 121.10 after the company priced its initial public offer at the top end of the Rs 630 to Rs 660 a share price range. The initial public offering was oversubscribed 19.29 times.

Cairn India Limited increased 1.4% to Rs 343.60 after the company said it may receive an offer to Vedanta offer from state-run ONGC.

GMR Infrastructure Limited surged 4.4% to Rs 62.55 after the company said it is in advanced negotiations to sell a 50% stake in power utility InterGen NV to China Huaneng Group, for about $1.2 billion.

Hindustan Petroleum Corporation Limited rose 1.8% to Rs 506.10.

IL&FS Investment Managers Limited gained 3.7% to Rs 48.90 after the investment company is close to exiting at least six of its investments in the real estate sector by the end of the current financial year.

Indiabulls Financial Services Limited rose 0.1% to Rs 153.55 after the financial services company said it may sell its 26% stake in Indian Commodity Exchange to Reliance Anil Dhirubhai Ambani Group.

Idea Cellular Limited fell 1.55% to Rs 69.80 after the mobile services operator added 1.86 million subscribers in July and increased the total to 71 million.

Jupiter Bioscience Limited surged 4.4% to Rs 102.35 after the drug intermediates, specialty and fine chemicals company fixed a board meeting on 24 August 2010 to consider preferential allotment of securities.

Moser Baer India Limited soared 6.6% to Rs 66.45 after the optical storage media company reported that the US private equity firm Blackstone Group has agreed to invest $300 million in an unlisted group energy firm -- Moser Baer Projects.

Madhucon Projects Limited rose 0.8% to Rs 156.05 after the executor of infrastructure projects reported the company is set to begin mining at one of its coal blocks in Indonesia in 2-3 months.

Reliance MediaWorks Limited soared 3.5% to Rs 201.40 after the film production and distribution unit inked a joint venture agreement with US-based CBS Studios Inc for operating a portfolio of TV channels in India and in the subcontinent.

State Bank of Mysore surged 7.9% to Rs 900.40 after the lender raised its prime lending rate by 50 basis points with effect from today, 18 August.

Tata Motors Limited increased 4.6% to Rs 1,047.60 after reporting better than expected earnings.