India Stocks Surge; UTI Stake Sold to T. Rowe

Mayank Mehta
09 Nov, 2009
New York City

Prime Minister Singh comments suggested that Indian economy is recovering and likely to meet the economic target of 6.5% in the current year and 7% in fiscal 2010. Stocks surged. T. Rowe Price acquires 26% stake in UTI Asset Management as retail investments surge.

[R]6:00 PM Mumbai, 8:30 AM New York – Prime Minister Singh comments suggested that Indian economy is recovering and likely to meet the economic target of 6.5% in the current year and 7% in fiscal 2010. Stocks surged. T. Rowe Price acquires 26% stake in UTI Asset Management as retail investments surge.[/R]

The Sensex index in India increased 340.44 or 2.1% to 16,498.72 and CNX Nifty index rose 102.25 or 2.1% to 4,898.40. Among the Sensex 30 stocks, 5 declined and 25 rose.

On BSE trading, 1,982 stocks advanced, 756 declined and 48 were unchanged.

The Group of 20 finance ministers and central bankers pledged on Saturday to prepare strategies to end emergency support for their economies, but to keep the stimulus package in place until the world economic outlook improves.

Prime Minister Manmohan Singh said on Sunday also suggested that economic growth in the current year is expected be 6.5% and next year may increase to 7% if rainfall picks up. The positive outlook lifted the trading sentiment.

Rupee edged higher 30 paisa to 46.50 against one dollar.

T. Rowe Price acquired UTI Asset management from government controlled banks. State Bank of India, Punjab National Bank, Bank of Baroda and Life Insurance Corp agreed to sell stakes held by each financial institution.

T. Rowe Price acquired 21% stake in the asset management and Punjab National Bank sold 6.5% stake for 163 crore rupees or $35 million. The deal values the asset manager at $475 million.

Gainers & Losers

Ashok Leyland rose 3.1% to Rs 52.80 after the maker of commercial vehicles said it expects a double-digit growth in sales during this fiscal year.

Ahluwalia Contracts (India) Ltd rose 1.1% to Rs 167.05 after the ready mix concrete maker secured various new projects worth Rs 242 crore.

Bharti Airtel Limited dropped 3.8% to Rs 307.50 and the wireless telecom carrier plans to outsource more network work.

Chambal Fertilisers and Chemicals Limited fell 0.8% to Rs 51.20.

Emami Limited decreased 0.8% to Rs 460.05 and the health and personal care product plans to diversify into cement business and invest Rs 1,750 crore to set up production units in the next three years.

Fedders Lloyd Corporation rose for the second day in a row by 5.0% to Rs 72.50 after it secured a contract in Africa.

Geometric Limited the engineering solutions provider rose 4.9% to Rs 47.85.

Hindustan Unilever Limited fell 0.7% to Rs 271.05 and the company plans to allocate higher capital for marketing and promotion activity.

Larsen & Toubro Limited rose 1.5% to Rs 1,599.55 after the engineering contractor received a contract of Rs 1,635 crore from Madhya Pradesh Power Generating Company for 1200 MW Malwa coal fired power plant.

Nakoda Textile Industries Ltd added 7.1% to Rs 82.85 after the company set December 3 to split its stocks 2-to-1.

Plethico Pharmaceuticals Limited added 7.2% to Rs 300 after the pharmaceutical maker launched an immune boosting product in the U.S.


Punjab National Bank increased 2.4% to Rs 907.40.

Reliance Industries Limited advanced 3.4% to Rs 2,023.90 after the petrochemicals, refining, and oil and gas said the company is close to acquiring a part of the assets owned by troubled petrochemical major LyondellBasell.

State Bank of India increased 5.1% to Rs 2,318.55 after it sold its stake in UTI Asset management to T. Rowe Price.

Simbhaoli Sugars Limited rose 3.1% to Rs 71.40 and the sugar refinery may plan to raise funds at a meeting on November 11.

Sonata Software Limited increased 3.1% to Rs 34.35 and the company acquired a new software outsourcing contract but did not disclose the amount.

Suzlon Energy Limited edged up 0.08% to Rs 66.30.

Sundaram Brake Linings Limited increased 4.6% to Rs 167.50 said it will invest about Rs 21.5 crore to raise friction materials production capacity by 3,000 tons to 23,000 metric tons.

Usha Martin Limited rose 3.0% to Rs 73.50 after the steel and wire ropes maker board will meet on November 12 to consider raising funds through issue of securities.

XL Telecom & Energy Limited gained 4.9% to Rs 29.50 after the provision of heat shrink wrap around cable jointing kits has received orders valued Rs 23.50 crore for supply of Solar Photovoltaic Power Systems to Bharat Sanchar Nigam Limited.

Asian Markets Review

The Nikkei 225 Index in Tokyo closed higher 19.64 or 0.20% to 9,808.99, and Hang Seng index in Hong Kong increased 377.83 or 1.73% to 22,207.55, and CSI 300 index in China higher 12.77 or 0.37% to 3,495.79. ASX 200 index in Australia increased 80.90 or 1.76% to 4,674.90. The FTSE Bursa KL Composite index in Malaysia was higher 6.99 or 0.55% to 1,267.75.

The Kospi Index in South Korea increased 4.33 or 0.28% to close at 1,576.79. SET index in Thailand closed higher 14.85 or 2.13% to 713.48. JSE Index in Indonesia increased 11.33 or 0.47% to 2,406.43. The Sensex index in India increased 340.44 or 2.11% to 16,498.72.