India Tax Collection on Target

123jump.com Staff
17 Mar, 2009
New York City

Stocks in India declined despite a regional gains in trading. Indian government official voiced confidence in meeting direct taxes collection. Several large companies filed avanced tax payment, but lower than anticipated.

[R]11:00AM New York, 8:30 PM Mumbai – Indian government officials sounded confidant note on direct tax collection for the current fiscal year. Large companies including Reliance Industries, State Bank of India, ACC and Larsen & Toubro fell on paying less than expected advanced taxes.[/R]

Market Sentiment

Indian stocks fell 0.9% as investors took profits after a 10% jump in the benchmark index in the last three trading sessions.

The losses were pared by news that the government will be able to meet its revised target for direct tax collections in the current fiscal.

In Mumbai, the BSE 30-share Sensex Index declined 0.9% or 79.72 to 8,863.82, and the CNX Nifty fell 0.7% or 19.80 to 2,757.45.

Of the stocks traded on the BSE, 1,347 rose, 1,162 declined, and 62 were unchanged.

Trading Statistics

Daily turnover on the BSE rose to 3,956 crore rupees compared with 3,504.97 crore rupees yesterday.

Government Collects 2,96,200 crore rupees Tax

Economic Times of India reported today that a finance ministry official said the government has collected 2,96,200 crore rupees from direct taxes in the current fiscal.

Economists project that the government will be able to meet its collection target of 3,45,000 crore rupees for the current fiscal year ending this month.

The government is likely to collect advance taxes of 15,000 to 20,000 crore rupees.

However government lowered its revised target for direct tax collection by 20,000 crore rupees from the budget estimate of 3,65,000 crore rupees for the current fiscal year.

World Bank to Approve $2.6 billion Loan

Separately the online edition of Economic times reported that the World Bank will approve a $2.6 billion special loan package as part of its $14 billion exposure to India.

The India Infrastructure Finance Company is expected to get $1.2 billion, SIDBI is expected to receive $400 million and Power Grid Corporation is expected to receive $1 billion.

World Bank''s Economic Adviser for India, Giovanna Prennushi said the Bank is in the advanced stages of approving the loan.

The Bank is also working on the $3 billion loan for recapitalization of public sector banks.

Gainers & Losers

Reliance Industries plunged 2% to 1,300.35 rupees after its advance tax payment fell 16.5% to 370 crore rupees in the fourth quarter ended March 2009 from the comparable year ago period.

HDFC Bank fell 2.3% to 825.40 rupees on reports Oman''s largest lender Bank Muscat will sell its entire stake in HDFC Bank.

State Bank of India dropped 3.9% to 949.60 rupees after its advance payment climbed 27.6% to 1810 crore rupees in the fourth quarter ended March 31.

ICICI Bank increased 0.5% to 324.15 rupees as its advance tax payment remained unchanged at 250 crore rupees in the review period.

IT stocks dipped as fears over the health of the global economy offset the weakening of the rupee to 51.48 against the dollar from 51.38 yesterday. TCS declined 4.3% as the company''s advance tax payment fell 54.3% to 53 crore rupees in fourth quarter.

Wipro fell 0.4%, Infosys Technologies dropped 1.8% and HCL Technologies shed 0.4% after securing a contract worth $350 million.

Tata Steel plunged 0.1% despite an increase in the company''s advance tax payment by 35.3% to 406 crore rupees in the fourth quarter.

Hindalco Industries gained 2.3% but Hindustan Unilever fell 0.7% even as the company''s advance tax payment increased 30% to 130 crore rupees in the review period.

Larsen & Toubro shed 1.5% after the company''s advance tax payment rose 61.8% to 275 crore rupees in the fourth quarter to March 31.

ACC fell 1.1% despite its advance tax increasing 36.9% at 319 crore rupees in the fourth quarter.

Grasim Industries fell 1%. Tata Motors rose 3.4%.