Recovery from day's lows

Wed, 6 Apr 01:30 pm

   Previous Close   

   Pre-Open   

   09:30 am   

   11:30 am   

   Closing   

The benchmark indices in the Indian stock market recouped some of their losses in the past two hours but continued to trade in the red. Stocks from the realty and consumer durables space are trading firm while stocks from IT and telecom space are trading weak.

The BSE-Sensex is down by 45 points while NSE-Nifty is trading 12 points below the dotted line. However, BSE Midcap and BSE Small cap indices are up by 0.7% and 0.8% respectively. The rupee is trading at 44.21 to the US dollar.

Most of the Power sector stocks are trading positive with PTC India Ltd and GVK Power leading the gains. However, NHPC and Tata Power are trading weak. As per a leading financial daily, Reliance Infra has stated plans to continue with its 7.2 km sea link between Worli and Haji Ali in Mumbai. The company is going ahead as per provisions of a contractual agreement between Maharashtra State Road Development Corporation (MSRDC) and its SPV Reliance Sea Link One Pvt Ltd. However, the state Government has plans to explore a coastal road proposition instead which will cost around Rs 5 bn. The Government has sought approval from environment ministry for the same. This would be much cheaper than the sea link. The final call on the matter will be taken by the Cabinet subcommittee chaired by chief minister. In a separate development, Mr. Anil P. Gupta will be taking charge of infrastructure division of Reliance infra. The move is as per company’s strategy to expand in high growth sectors like roads, airports, sea links, metro, real estate and SEZ development. Mr. Gupta has worked as the President of Honeywell International Ltd. The stock is trading in the green.

Energy stocks are trading mixed with Indraprastha Gas and BPCL leading the gains. However, Gujarat State Petronet and Cairn India are trading weak. As per a leading financial daily, ONGC will be outsourcing gas production activities at 40 marginally-filled and isolated wells in Krishna-Godavari (KG)basin to other companies on production sharing basis. The company is making this move to make gas production economically viable (at current gas price of US$ 4.20 per mmbtu and 60% of the international price for oil) in the areas where the output pressure has fallen below 700 PSI. This is the basic minimum pressure limit required to connect to GAIL pipeline.

The company has also expressed the possibility of getting 40-60% of the gas produced by the private operators depending upon the well. As per industry analysts, these wells could have a further production potential of 10,000 to 20,000 cubic meters of gas for a period of 2-5 years. The company also said that the previous investments made by ONGC in these marginal fields have been recovered and it plans to outsource fields in Western Offshore basin as well. The KG Onshore provides ONGC with a turnover of around Rs 10 bn and produces around 950-980 tons per day of oil and 38 mmscmd of gas with value added products of 67,000 tons per annum.