Sensex Soars 2% on International Demand for Coal India IPO

Chandrasekhar Atreya
21 Oct, 2010
New York City

Stocks in Mumbai surged tracking gains in the international markets, steady foreign fund flows and strong interest in Coal India IPO. Environmental ministry rejects Vedanta

[R]5:00 PM Mumbai – Stocks in Mumbai surged tracking gains in the international markets, steady foreign fund flows and strong interest in Coal India IPO. Environmental ministry rejects Vedanta’s application for alumina refinery expansion in Orissa. Power Grid, GSFC and Canara Bank report better than expected earnings.[/R]

Indian stocks rose the most in a week on earnings outlook, thus helping the benchmark index to post the biggest gain in Asia. All sectoral indices were in the green with capital goods, oil & gas and metals leading the rally.

The BSE Sensex rose 1.95% or 388.43 to close at 20,260.58. The CNX Nifty on the National Stock Exchange gained 119.40 to close at 6,101.50.

Food inflation slowed after the heaviest monsoon rainfall in three years boosted agricultural production of rice, wheat and corn.

An index measuring wholesale prices of agricultural products compiled by Commerce Ministry rose 15.53% in the week ended October 9 from a year earlier, after gaining 16.37% in the previous week according to a statement in New Delhi Thursday.

The rupee edged down to close at 44.32 to a dollar losing 6 paisa in Mumbai trading.

Coal India IPO has attracted a whopping inflow of about Rs 1,200 abaj from international investors, higher than the record Rs 1,080 abaj invested in local securities.

Although about 90% of the funds are estimated to be repatriated but the flows have affected the stock market and rupee.

Government-owned companies in the banking and insurance segments have together put in bids worth nearly Rs 30,000 crore in the initial offer of Coal India. Institutional tranche of the offering is oversubscribed 22%.

Vedanta Resources application for expansion of its alumina refining complex was rejected, according to a notice from the Environment Ministry. The ministry ordered the company not to undertake any new construction work the site in Orissa.

The Asian Development Bank plans to issue a bond next year solely for water projects in a bid to lend as much as $25 billion over the next decade amid persistent water supply problems in the region.

The bank had earlier warned that about half a billion Asians have no access to safe water supply with most waste water left untreated, polluting rivers and lakes. By 2030, water demand in this region will exceed supplies by at least 40% unless countries improve water treatment and management of fresh water supply, said Arjun Thapan, a special advisor to the bank in an interview.

Gujarat Mineral Development Corp is seeking partners to set up an alumina refinery and an aluminum smelter in the Kutch district of Gujarat, according to a bid document posted on the Web site of the company.

Cochin Shipyard Ltd received an order for Rs 1,500 crore to build 20 fast patrol vessels for the coast guard, the company said in Kochi on Thursday.

“The order has been secured under very severe competition from defense and private yards and has taken the present order book position to 36 ships valued at Rs 6,000 crore,” the release said.

Mahindra Two Wheelers reported its best monthly sales of 16,569 scooters in September, a 451% increase from a year ago sales in the same month.

The company sold 1.5 lakh units in the last 12 months, riding on the back of its power scooter strategy targeting young adults.

PowerGrid Corp said Wednesday that its profit after tax for the quarter ended September rose 41.62% to Rs 651.4 crore, from a net of Rs 459.97 crore in the earlier year period.

Gujarat State Fertilizers & Chemicals Ltd said Wednesday its net profit for the quarter ended September grew more than two-fold to Rs 207.01 crore from Rs 77.17 crore in the quarter a year ago.

Canara Bank on Wednesday reported a 10% rise in net profit at Rs 1,007.8 crore for the second quarter ended September from Rs 910.5 crore a year ago.