Volatility plagues Indian bourses

Wed, 22 Jun Closing

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Indian stock markets had a rather volatile outing today as they oscillated to either side of yesterday's close. Whatever attempts were made to stay afloat were thwarted as profit booking at higher levels took toll. This continued in the final trading hour as well before the indices closed just below the dotted line. While the BSE-Sensex closed lower by around 10 points, the NSE-Nifty closed higher by around 2 points. The BSE Midcap and BSE Small cap were at the receiving end as they closed lower by 1% each. Losses were largely seen in consumer durables and FMCG stocks.

As regards global markets, Asian indices closed mixed today while European indices have opened in the red. The rupee was trading at Rs 44.87 to the dollar at the time of writing.

Pharma stocks closed mixed today. While Cipla and Sun Pharma found favour, Ranbaxy and Cadila Healthcare closed in the red. Pharma major Sun Pharma has received US FDA approval for marketing the generic version of 'Imitrex' injection (Sumatriptan Succinate) in the US. 'Imitrex' is the trademark of global pharma major GSK Plc and is used for the treatment of migraine attacks and cluster headache episodes. The injection has annual sales of US$ 190 m in the US. This is a positive for the company and will enhance its sales from the highly competitive US generics market. It must be noted that the company's sales in the US were under pressure ever since its subsidiary Caraco ran into trouble with the US FDA. However, after a long court battle, Sun Pharma was able to acquire Taro Pharmaceuticals which is expected to bolster its sales from the US. Plus, a large number of drugs going off patent over the next few years will also augur well for Sun Pharma's US generics business.

As per a leading business daily, engineering major L&T's subsidiary has signed a Rs 26 bn concession agreement with the National Highways Authority of India (NHAI). This is for four-laning of the 244 km of NH14 between Beawar and Pindwara in Rajasthan. The project is scheduled to be completed in 30 months. It will be executed on a BOT (build operate transfer) and DBFO (design, build, finance and operate) basis. The concession period is of 23 years. It must be noted that after bagging this order, L&T now has 16 projects in its BOT roads portfolio, of which 7 are currently in the operational phase, 8 in the construction phase and this project is entering the development phase. This is a positive for the company since an increasing order book spells revenue visibility in the future. But as is the case with infrastructure projects, execution is the key. In fact, L&T has faced some delays on the execution front in the past. The stock closed higher today.