India Targets 8% Economic Growth

Mayank Mehta
22 Feb, 2010
New York City

India

[R]7:30 PM Mumbai – India’s President Pratibha Patil said to the Parliament that the government is targeting at least 8% economic growth in the next fiscal year beginning April 1 and 9% in the following fiscal year. Steelmakers, automakers and infrastructure stocks closed higher.[/R]

The Sensex index closed up 45.42 to 16,237.05 and the CNX Nifty Index closed up 0.2% to 4,856.40.

Investors awaited details of the government budget after President Pratibha Patil told the Parliament that her government is targeting at least 8% growth in the fiscal year beginning April 1 and 9% in the following year.

Last week C. Rangarajan, advisor to the Prime Minister had indicated that the central government borrowings in the next fiscal year are likely to exceed the current year borrowings of $97 billion.

He also indicated that the budget deficit may decline to 5.5% in the next fiscal year from the current year deficit of 6.8%.

Investors are estimating higher government stake sales in the publicly traded companies and increased infrastructure spending.

Stock Movers

Cadila Healthcare Ltd increased 2.2% to Rs 716.65 after the company board is expected to meet on Feb 25 to approve bonus shares.

Fame India Ltd surged 5% to Rs 87.60 after Reliance MediaWorks Ltd. said it will pay 63.5% more than offered by Inox Leisure Ltd for a majority stake in the company.

Jaiprakash Associates Limited increased 1.6% to Rs 131.85.

Reliance Industries Ltd decreased 1% to Rs 972.95 after the company revised its offer for bankrupt LyondellBasell Industries AF to $14.5 billion from the earlier price of $13.5 billion. Investors in Mumbai are worried that the company may be overpaying for a commodities maker.

Shree Renuka Sugars Ltd added 3.7% to Rs 186.55 after the company completed the acquisition of 51% stake in Brazil based Equipav SA Acucar e Alcool for $329 million.

Metals makers closed higher after President Patil indicated government growth targets. Tata Steel increased 2.1% to Rs 572.75 and Hindalco Industries Ltd added 2.8% to Rs 154.15.