Sensex in India Drops; Gujarat Plans $11 Billion of Dam Investment

Chandrasekhar Atreya
26 Oct, 2010
New York City

Stocks in Mumbai dropped in a choppy session tracking losses in Asia. Coal India IPO price was set at Rs 245 a share, at the upper end of its filing range and raise $3.5 billion for India. Gujarat government plans the world

[R]5:00 PM Mumbai – Stocks in Mumbai dropped in a choppy session tracking losses in Asia. Coal India IPO price was set at Rs 245 a share, at the upper end of its filing range and raise $3.5 billion for India. Gujarat government plans the world’s first ever dam across the sea at the cost of $11 billion.[/R]

Indian stocks witnessed a choppy session with negative bias ahead of October series F&O settlement and negative cues from other Asian bourses.

The BSE Sensex dropped 0.44% or 89.24 to close at 20,213.88. The CNX Nifty on the National Stock Exchange lost 23.80 points to close at 6,082.00.

India is expeced to raise $3.5 billion or Rs 16,000 crore after the government decided on Monday to fix the price of Coal India IPO at Rs 245 per share, at the higher end of the price range.

India sold 631.6 million shares or 10% of its stake in Coal India.

India may not raise more than Rs 40,000 crore this year from the stake sale in public sector firms, said a government official and may delay some of the public offering of government stakes in public companies to the next fiscal year.

The Rs 100,000 crore windfall from the sale of 3G and broadband spectrum against the target of Rs 35,000 crore, has given the government sufficient cushion to meet the Rs 55,000 crore extra expenditure in the first supplementary demand for grants.

The rupee moved today in a tight range with a weakening bias on lower domestic shares and stronger overseas dollar.

The rupee closed today at Rs 44.36 in Mumbai.

India aims to increase its nuclear power capacity by the year 2030 to 60,000 megawatts from the existing 4,560 megawatts at the end of July. India’s total power generation capacity was 163,670 megawatts as of July 31, according to the Central Electricity Authority.

NTPC said Monday it will invest about Rs 20,000 crore for setting up a coal-based power project in Madhya Pradesh.

NTPC executed an agreement with Madhya Pradesh and MP Power Trading Company for setting up a 3,960 megawatt thermal power project at Barethi in the state, the company informed the National Stock Exchange.

The U.S.-based General Electric landed India’s largest single order for gas and steam turbines in a $750 million deal with utility giant Reliance Power Ltd.

GE will provide six gas turbines and three steam turbines for the expansion of Reliance Power’s plant in Andhra Pradesh, the U.S. company said late Monday.

Gujarat government is planning to build a dam in the northern region of the Gulf of Cambay with an investment of Rs 50,000 crore.

The 35-kilometer project named as Kalpasar Dam Alignment would lead to a sweet water reservoir, besides providing a road and rail over bridge, which will reduce the distance between Bhavnagar and Surat by 200 kilometers.

India will have to import 5 million tons of LPG by 2015, to meet increasing demand, a top industry official said Monday.

“Demand for cooking gas is rising, which stood at 10% in September from the earlier 3% to 4%. Looking at this rise in demand, we will be importing around 5.5 million tons of LPG by 2015,” HPCL Chairman and Managing Director, S. Roy Choudhury, told reporters in Mumbai on Monday.

The increased tensions between China and Japan seem to have opened a new business opportunity for India. In a joint statement issued after the talks between the Indian Prime Minister and his Japanese counterpart, the two leaders sought to explore the possibility of bilateral cooperation in development, recycling and reuse of rare earths and rare metals.

In the event of the two sides striking a deal, the biggest beneficiary would be the Kerala-based state-run Indian Rare Earths. The production of rare earths is expected to begin soon at its plant in Chavara and India could add export of rare earths to Japan to boost trade with that country.

India and Japan concluded a partnership agreement on Monday calling for elimination of custom duties on 94% of traded items between the two countries.

The agreement, which for Japan has the added aim of checking an increasingly assertive China, is expected to take effect from next year. Tariffs on 90% of Japan’s exports to India and around 97% of India’s exports to Japan will be eliminated over the next decade.