Indian share markets remain in red

Mon, 15 Jul 11:30 am

   Previous Close   

   Pre-Open   

   09:30 am   

   01:30 pm   

   Closing   

Indian share markets have remained in red during the previous two hours of trade with bankex and metal facing the maximum selling pressures.

The BSE-Sensex is down by 33 points and NSE-Nifty is down by 11 points. That said, BSE Mid Cap is up by 0.5% and BSE Small Cap is up by 0.3%. The rupee is trading at 60.04 to the US dollar.

Automobiles' shares are trading on a mixed note with Force Motors and Tube Investments leading the gains while Ashok Leyland and Mah. Scooters facing the maximum selling pressures. According to a leading financial news medium, Ashok Leyland, the commercial vehicles maker, has decided to discontinue production at Czech Republic subsidiary Avia's plant in Prague from this month. Global economic slowdown has been the prime reason for the same. Avia Ashok Leyland Motors has been part of Ashok Leyland since 2006 and producing trucks in the range of 6.5-12 tonnes GVW (gross vehicle weight) rating. That said, the company will continue to provide aftermarket services like warranty and spare parts to all its customers. As and when the economic situation improves, the products would be made available from other manufacturing sites of Ashok Leyland. The company has already lined up four launches for the current financial year. These include the launch of two cargo carriers which are expected to be launched before October this year. These will be manufactured at the company's Pantnagar facility and the trucks will have Avia's cabin. Earlier this year, Avia stated that 2013 will be an important year for stabilising business in new markets. It also intends to improve product efficiency and introduce innovations to its product portfolios. It remains to be seen how Ashok Leyland's product portfolio will shape up given the slowdown effects.

Except few such as Guj. State Petronet and Bharat Petroleum Corporation Ltd. (BPCL), most of the energy sector shares are trading in green with Jindal Drill and Cairn India leading the gains. According to leading financial news daily, GAIL India, the public sector gas entity, has been in talks with the Pakistani Government to supply LNG at lower prices. A five-year contract is being negotiated between the two parties for supplying 5 million standard cubic metres per day (mmscmd) of gas to consumers in Pakistan. This will mark as a lucrative business opportunity for GAIL since the company already has long-term LNG import contracts with firms in US, Russia, Australia and Qatar. Moreover, the LNG received at Dabhol terminal can be re-gassified there and can be transported cost-effectively to Lahore units via a pipeline connection. This gas supply to Pakistan in turn will increase utilisation levels of the pipeline that has remained under-utilised. The pipeline has a capacity of 31 mmsmcmd, of which only 2-3 mmscmd is being utilised as some power plants and SEZ projects in adjoining areas have failed to take off. Pakistan currently has considerable dependency on gas which is 32% of the country's energy mix. This provides as a value business opportunity for GAIL to bank on. GAIL's share is up by 0.4%.