BOMBAY, 24 February — The Indian stock markets have entered into a very strong rally prior to the budget for 2002-2003 which is to be presented next week. Throughout the week, the markets were volatile and banking stocks were high on expectations of sops in the budget. Moreover there was also a lot of expectation in the markets over the results of the UP Assembly polls.
On Monday markets continued to follow the upward rally of the previous week and buying in select blue chips continued unabated. The BSE Sensex closed up higher by 31.91 points at 3,633.03. FIIs also remained net buyers.
Stocks of private sector banks were in the limelight following the Reserve Bank of India’s (RBI) clarification that 49 percent foreign direct investment (FDI) may be allowed in these banks.
Zee Telefilms was a major gainer of the day at Rs. 160.60 following its agreement with the promoters of ETC Network, a Hindi music channel, to acquire their 48.38 percent equity stake in ETC.
In the pharma sector, Ranbaxy surged up to Rs. 824.65 after it received approval from the Drug Controller of India (DCGI) to launch a version of Merck’s singular anti-asthma drug ‘Montelukast’ in the local market. ITC gained ground on hopes that cigarettes may be spared from a fresh excise duty hike in the forthcoming budget.
Stocks lost ground on Tuesday due to profit booking. The BSE ended with a loss of 36.32 points at 3,597.61. While PSU and banking sector stocks declined, selective buying interest was seen in second rung IT stocks.
Bharti Tele-Ventures got listed on the BSE but it touched a new low of Rs. 41, before settling at Rs. 41.20. The stock of the telecom major made its debut on BSE at Rs. 50, a 11 percent premium over its issue price of Rs.45.
Non-Sensex PSU stocks Neyveli Lignite (Rs. 18.35), Bharat Earth Movers (Rs. 46.85), Shipping Corp. of India (Rs. 58.85), Engineers India (Rs. 162.15), Indian Oil (Rs. 176.05), IPCL (Rs. 80.90), BPCL (Rs. 291.55) and Nalco (Rs. 72) declined on profit booking after recent gain. The profit booking continued onto Wednesday also due to selling pressure. The BSE lost another 39.40 points to settle at 3,558.21. Cement stocks were subdued on reports of a fall in the price of cement in Bombay by around Rs. 10 per 50-kg bag. The outlook remained pessimistic despite sustained buying by FIIs.
Print media stocks like Mid-Day Multimedia, Tata Infomedia and Sandesh rose on hopes of some policy decision on the issue of foreign direct investment (FDI) in the print media.
Moser Baer faced a lot of selling following reports that Electra Partners, a private equity fund which held 17 percent of the company’s Rs. 48.40 crore equity, sold a major part of its stake in the company.
The markets were a little better off on Thursday. But profit taking at higher levels anchored the gains. The BSE ended the day with a modest gain of 12.25 points at 3,570.46.
Hero Honda Motors was the “star” of the day after it touched a new 52-week high of Rs. 358.50 before settling at Rs. 345.30.
Telco was up at Rs. 137.60 following the company’s announcement of financial restructuring. The company plans to write off deferred revenue expenses to the tune of Rs. 1,180 crore and this is expected to improve its return on net worth.
Kotak Mahindra Finance was high at Rs. 113.90. Last month, it received an in-principle approval from the Reserve Bank of India to convert itself into a commercial bank.
And the Indian bourses ended the last of trading, Friday , on a positive note. Sustained buying led to the BSE notching up a gain of 33.62 points at 3,604.08. Stocks of steel, automobiles, finance and also public sector undertakings gained ground on renewed buying. Expectations of a reforms-oriented budget and sustained buying by FIIs kept the undertone bullish.
Out of the 1,543 issues traded on BSE, advances outnumbered declines, with 717 gainers and 680 losers. 146 issues remained unchanged. The top sensex gainers at close were Tisco , ICICI and Hero Honda. And the losers were ACC, Nestle and Satyam Comp.
Tata Steel rose on expectations that the steel industry will find favor in the budget. ICICI was also up on rumors of a private placement of the shares of ICICI Bank, in which the company is expected to merge, at Rs. 170-175. Tata Telecom touched a new 52-week high of Rs. 161 as it has emerged as a leading player in telecom software solutions with a 60 percent market share.
Gold was at Rs. 4,600/- per 10 gms and Silver was at Rs. 7,585/- per kg.
US$ was at Rs. 48.69, Pound Sterling at Rs. 69.69, Deutsche Mark at Rs. 21.41, Euro at Rs. 42.66, UAE Dirham at Rs. 13.26, Kuwait Dinar at Rs. 158.29, Bahrain Dinar at Rs. 129.14, Saudi Riyal at Rs. 12.98, Qatar Riyal at Rs. 13.37 and Oman Riyal at Rs. 126.46.
