GDP in India Expands at 8.8%

Chandrasekhar Atreya
31 Aug, 2010
New York City

India reported GDP in the fiscal first quarter ending in June expanded at the fastest rate in ten quarters. The growth in manufacturing and mining industries led the expansion as exports growth trailed the domestic consumption.

[R]5:00 PM Mumbai – India reported fiscal first quarter ending in June at the fastest rate in ten quarters. The growth in manufacturing and mining industries led the expansion as exports growth trailed the domestic consumption. Stocks fell on the worries that the Reserve Bank may be forced to raise rates as the faster growth sustains the elevated inflation.[/R]

In Mumbai trading stocks fell in the day’s trade to lose 0.34% or 60.99 to close at 17,971.12.

India’s GDP expanded in the quarter to June at 8.8%, from a year earlier after an 8.6% expansion in the previous quarter, the Central Statistics Organization said in New Delhi Tuesday.

The economy expanded at the fastest pace ten quarters as domestic consumption and rising wages support the expansion. Exports growth has been anemic but exports are only 20% of the GDP.

Reliance Industries agreed to pay Rs 1,020 crore for acquiring 14.12% stake in EIH Ltd., operator of Oberoi and Trident hotels, according to a statement by RIL yesterday.

Research in Motion averted a ban on its BlackBerry services in India after it provided the government with monitoring solution to test its services. India’s telecommunications department will test the solution for 60 days to see if it allows security agencies to tap its messenger and enterprise mail services, Onkar Kedia, a spokesman for the Indian Home Ministry said Monday.

NTPC may offer up to 49% equity stake to Qatar Petroleum in its gas-based project at Kerala, to secure fuel supply for its power plant. “We have offered Qatar Petroleum less than 50% stake in our Kayankulam gas-based power plant in Kerala,” NTPC CMD R.S. Sharma told reporters in New Delhi Monday.

The current capacity of the plant is 350 megawatt, which the company is planning to expand to 1,050 megawatt in the next two years and further expand it to 1,800 megawatt later.

NTPC also said it may join hands with Bangladesh Power Development Board to establish two thermal power projects totaling 1,320 megawatts in Chittagong and Khulna for mitigating the power shortages in the neighboring nation.

NTPC is likely t pick up stake in two coal mines in Indonesia, a move that could help the firm secure its raw material requirements.

“We are looking at picking up stake in two coal mines in Indonesia, one in East Kalimanthan and another in Sumatra,” Sharma told reporters in New Delhi Monday.

Bangalore-based GMR Infrastructure plans to sell stakes in two airports it controls. The GMR Group has 54% stake in Delhi airport and 63% in Hyderabad airport and has a total of around 5,705 acre of land at two airports that it operates.

“Land is like a gold mine and we are unlocking its value now,” said GM Rao, Chairman, GMR Group.

Drug maker Jubilant Oragnosys said Monday it signed a long-term contract worth $33 million a U.S. life sciences company for its custom research and manufacturing services business.

India’s port capacity is all set to touch a milestone with the combined capacities of all major and non-major ports crossing the one billion mark in September.

According to port officials, the nation-wide total capacity of ports stands at 996 million tons. With Gujarat Maritime Board facilities adding 19 million tons next month, the total capacity in the country is expected to cross 1,015 million tons.

The major chunk to the growth in capacity comes not from the government-controlled 12 major ports but from non-major ports, led by those managed by Gujarat Maritime Board. The total capacity available with the 12 ports as on June 30, 2010 was 619.88 million tons and non-major ports’ contribution was 355.06 million tons and of this tonnage GMB-controlled ports alone was 243.64 million tons.

Gainers & Losers

Cerebra Integrated Technologies gained 1.5% to Rs 23.45 after the information technology provider announced a strategic alliance with Singapore-based Cimelia Resources Recovery to set up India''s largest e-waste recycling unit at Bangalore.

Dabur India Limited increased 2.3% to Rs 209.75 after the health care company fixed September 10 as record date for a 1-to-1 bonus.

Dujodwala Paper Chemicals Limited declined 1.8% to Rs 18.25 after the company reported its audited net profit rose 153.66% to Rs 1.04 in the fiscal year ended March 2010 compared to Rs 0.41 crore a year ago.

EIH Limited declined 7.1% to Rs 139.95 after the hotelier said Reliance Industries announced the acquisition of 14.12% stake from promoters of EIH for a total consideration of about Rs 1021 crore.

GHCL Limited plunged 6.1% to Rs 48.90 after the inorganic chemicals manufacturing company turned ex-dividend today, for a dividend of Rs 2 per share for the year ended March 2010.

Housing Development Finance Corporation Limited fell 0.5% to Rs 624.50 after a foreign broker cut its rating on the stock to """"sell"""" from """"neutral.""""

Karur Vysya Bank Limited soared 6.6% to Rs 756.50 after the private sector bank said its board will meet on September 7 to consider issue of further shares to augment capital including bonus and rights issue.

Kalindee Rail Nirman (Engineers) Limited gained 1.4% to Rs 159.05 after the railway related work company received a contract worth Rs 180 crore from a Vedanta group firm for a railway siding and linkage project.

Kingfisher Airlines Limited fell 0.8% to Rs 59.35 after the aviation company said its board will meet today, to consider raising funds.

Oil and Natural Gas Corporation Limited slipped 0.4% to Rs 1,338.75 after the oil explorer said crude oil prices declined more than 1% in Asian electronic trading.

Rasoi Limited fell 1.5% to Rs 325.00 after the vanaspati and refined oil producer turned ex-dividend today, for a final dividend of Rs 1 per share for the year ended March 2010.

Ruchi Infrastructure Limited declined 1.6% to Rs 32.75 after the storage infrastructure reported net profit of Rs 34.55 crore in the audited fiscal year ended March 2010 compared to net loss of Rs 11.94 crore during the fiscal year ended March 2009.

Tantia Constructions Limited gained 2.1% to Rs 84.55 after the civil infrastructure company secured an order worth Rs 15.01 crore from Executive Engineer, Rashtriya Sam Vikas Yojna for development of state highways in Bihar.

Wipro Limited rose 0.3% to Rs 399.80 after the information technology provider''s American depository receipts declined almost 1% to $12.95 on the New York Stock Exchange on August 30.