Oil & gas stocks drag markets

Thu, 30 Sep 11:30 am

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Indian indices languished in the red on account of profit booking across the board over the previous two hours of trade. Stocks from the oil & gas and PSU space are the biggest losers while stocks from the IT and capital goods space have lost the minimum.

The BSE-Sensex is trading down by 57 points while the NSE-Nifty is trading 17 points below the dotted line. BSE-Midcap is down by 0.5% while BSE-Smallcap index is trading marginally in the red. The rupee is trading at 44.95 to the US dollar.

Food stocks are trading mixed with Nestle and Agro Tech Foods trading firm while Lakshmi Energy and Britannia are trading weak. As per a leading financial daily, ITC has ended speculation by announcing that it will be subscribing to EIH's upcoming rights issue. The group will be seeking the board's clearance on this issue shortly. It may be recalled that EIH has announced its board's approval to raise up to Rs 13 bn through the issue of shares on a rights basis. However, the date of the rights issue, the ratio and issue price have yet to be finalized. Furthermore, a senior ITC executive ruled out reports that it was planning to demerge ITC Hotels and then form a partnership with EIH to create the country's largest hotel chain.

Healthcare stocks are currently trading mixed with Orchid Chemicals, Bilcare and Sterling Biotech trading firm, while Ipca Labs and Aventis Pharma are the top losers at the moment. The stock of Sun Pharma is amongst the top gainers from stocks forming part of the BSE-100 Index. Gains in the stock are on the back of the company getting a tentative approval for marketing the generic versions of AstraZeneca PLC's cholesterol drug ‘Crestor'. As per the company, it has received this tentative approval for various dosages - 5 mg (milligrams), 10 mg, 20 mg and 40 mg. However, the company will be able to sell the generic version of the drug only on receiving the final approval from the US FDA. This will be after 2016 as the patent for the drug ‘Crestor' begins to expire in 2016.

Nevertheless, considering that 'Crestor' is one of AstraZeneca's best selling products, this is a positive development for Sun Pharma. During the first half of 2010, the sales of this drug totaled to about US$ 1.3 bn (approximately Rs 56 bn) in the US alone. Total worldwide sales stood at US$ 2.7 bn (approximately Rs 123 bn). It is further reported that AstraZeneca has filed patent infringement lawsuits against companies such as Sun Pharma and several other companies who are hoping to market generic versions of 'Crestor'.