Stocks in India Surge, Tata Launches Nano

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

Stocks in India surged on a regional rally in Asia. The U.S. Treasury plan to purchase worthless debts lifted markets in India. Trading turnover on both exchanges surged. Tata Motors advanced 3% after it launched its much anticipated small car Nanao. Ranbaxy Labs surged 11% on approvals from UK.

[R]10:00AM New York, 7:30 PM Mumbai - Companies overseas borrowing decline 49% to $17.02 billion.[/R]

Indian stocks rose sharply on expectations U.S. Treasury attempts to purchase $1 trillion of toxic assets from banks will stimulate economic growth.

Investors also cheered news that the country’s business confidence rose in the third quarter current fiscal year ending in December.

In Mumbai, the BSE 30-share Sensex index surged 5.1% or 457.34 to 9,424.02, and the CNX Nifty gained 4.7% or 133.85 to 2939.90.

Of the stocks traded on the BSE, 1,630 rose, 923 declined and 60 were unchanged.

Trading Statistics

Daily turnover on the BSE increased to 3,709 crore rupees from 2,942.83 crore rupees on Friday last week.

Indian Firms Overseas Borrowings Fall 49% to $17.02 billion

Economic Times of India reported today that a study by industry body Assocham noted today money raised by Indian companies overseas dropped 49% to $17.02 billion in 2008 from $33.33 billion the previous year.

The number of companies borrowing funds through ECB route has dropped by 45.2% to 414 firms in 2008 from 756 from a year earlier.

Of the 15 business houses covered, nine recorded a decline in the amount of money raised.

Assocham Secretary General D S Rawat said, “As Indian business heads have slowed down their major activities owing to the financial crisis, demand for overseas borrowings took a back seat in 2008 compared to the previous year.”

India’s Business Confidence Index Rises

India’s Federation of Indian Chambers of Commerce reported today that the business confidence index in the third quarter of current fiscal year increased to 44 from 37.8 in the previous quarter.

According to the report, 64% of the 384 respondent companies, with turnover between one crore rupees to 33,000 crore rupees, said overall economic conditions have deteriorated between April and September, falling 22 percentage points from the previous survey. The survey conducted in the third quarter tracks the sentiment for the period between April and September of 2008.

The survey notes that 17% project an increase in exports in the next six months, while 59% forecast exports to drop. About 70% of the companies polled said they will source funds from banks to meet their requirements after the recent RBI measures to improve debt market access.

In addition, 52% of companies say they are reconsidering project investments due to the prevailing interest rate.

Gainers & Losers

DLF fell 2.2%, and Hindustan Unilever rose 2.5% after its advance tax payment rose 30% to 130 crore rupees in the fourth quarter ended March 2009 from the comparable period a year ago.

Larsen & Toubro advanced 3.4% on news L&T and Grasim Industries is set to resolve its seven year old legal dispute over Grasim`s 0.62% stake in L&T and the latter`s 11.49% stake in Ultratech, the Birla group cement firm.

Ranbaxy Laboratories rose 10.8% after company said drug regulators in the UK and Australia had issued ""good manufacturing practice"" certificates for its Paonta Sahib facility in India.

Tata Motors advanced 3.2% after launching the much talked about Nano in Mumbai today. Deliveries of the cars will start in July. The company expects to sell 35,000 cars in the first year of its launch and plans to ramp up production to 300,000 in the next three to four years. The car is priced at one lakh rupees to dealers.

Chairman Ratan Tata said the company will develop an export model for the U.S. market.

Reliance Industries gained 7.6% to 1,439.80 rupees on news it is in talks with Essar Oil to source petroleum products from the latter''s refinery in Gujarat and resume its retail petrol pump outlets shut for nearly a year.

ONGC rose 5.4%.

Financial stocks rose. ICICI Bank increased 7.4% after its advance tax payment remained unchanged at 250 crore rupees in the fourth quarter from the same period a year ago.

HDFC Bank rose 5.6%.

State Bank of India edged up 7.3% as its advance tax payment jumped 27.6% to 1,810 crore rupees in the fourth quarter.

IT stocks gained despite gain in rupee against dollar. TCS advanced 2%, Wipro rallied 3.3% but HCL Technologies fell 0.5%.

Infosys Technologies rose 2.57% on reports it may win a large IT project from the government.

Reliance Infrastructure surged 9.9% on reports the company is open to bidding for the over 12,000 crore rupees Hyderabad Metro Rail project if Maytas Infra backs out.