Sensex in India Rises, Auto Sales Fall

123jump.com Staff
03 Feb, 2009
New York City

Sales of automobiles in India declined in January on tight lending conditions and weak consumer confidence. Tata Motors sales dropped 33% and Mahindra Mahindra sales fell 21%. Market leader, Suzuki sales rose on demand for smaller cars.

[R]1:00PM New York, 11:30 PM Mumbai – Automakers fell after the release of auto sales for January. Sales at Tata Motors and Mahindra and Mahindra declined but sales at Maruti Suzuki rose.[/R]

Market Sentiment

In Mumbai, the BSE 30-share Sensex index rose 0.9% or 82.60 to 9,149.30, and the CNX Nifty rose 0.6% or 17.25 to 2,783.90.

Of the stocks traded on the BSE, 1,081 rose, 1,363 declined, and 67 were unchanged.

Trading Statistics

Daily turnover on the BSE rose to 3,212.91 crore rupees from 3,026.11 crore rupees yesterday.

Government to Review Ethanol Doping Programme

Economic Times of India reported today the petroleum ministry and the consumer affairs ministry are seeking support for the review of the Ethanol Doping Program.

Minister Murli Deora s petroleum ministry says the current 5% doping program is not followed across the nation uniformly, and there could be a shortfall in ethanol supply for the proposed 10% blending target if sugar cane output in the current fiscal year does not meet expectations.

However, oil marketing companies have a three year supply contract with individual sugar mills, which include an option to extend the ethanol supply agreement at the price of 21.50 rupees per litre for another two years when the current three years contract expires.

India’s Economy to Rise 7% in 2009

India’s commerce minister Kamal Nath said the country’s economy will grow by more than 7% this year despite the worsening global economic conditions.

As recently as last week, the Reserve Bank of India slashed its economic growth forecast for this year from 8% to 7% and private economists are forecasting growth between 5% and 6%.

Gainers & Losers

Reliance Industries gained 2% to 1,302.55 rupees.

DLF declined 13.3% on news the company plans to slash home prices by 20% to stimulate demand. At the time of the release of earnings the company said that home prices have dropped 30% and are likely to fall further as much as 20%.

Financial stocks advanced. HDFC Bank rose 1.2% but State Bank of India fell 0.4% to 1,091.30 rupees.

ICICI Bank rose 1.8% to 391.70 rupees and HDFC increased 0.6%.

Tata Motors fell 6.4% after its vehicle sales dropped 33% in January 2009 from the comparable period a year earlier, with commercial and passenger vehicle sales in India and overseas slipping to 36,931 units in the review period from 54,796 units in the comparable year ago period.

Mahindra & Mahindra fell 1.1% after sales declined 21% in January. SUVs, trucks and three-wheeled vehicles sales fell to 17,611 units from 22,309 units a year ago.

Maruti Suzuki India gained 3.1% after demand for SX4 and D’zire sedans increased sales.

Bharat Heavy Electricals gained 2.4% on news it will form a joint venture with Kerala based KEL.

IT stocks increased. Infosys Technologies edged up 0.3%, Wipro gained 1.8%, HCL Technologies edged up 3.8% and TCS rallied 1.6%.

Cement stocks gained. Ambuja Cements climbed 1%, India Cements advanced 4.5% and ACC advanced 5.1% after exports soared 12.5% to 1.89 million tons in January 2009 from a year earlier.

Ganesh Housing Corporation fell 1.4% after the company announced that its promoters have pledged 30% equity of the company with the bank.

Exide Industries advanced 3.6%.