Sensex, Nifty recede after hitting new record high
Proxy advisers may call for vote against Maruti’s Gujarat plan
Cairn Energy suspends share buyback due to tax dispute
Govt looks to raise
Rs 3,000 cr from PSU ETF
Mumbai, March 18
After making a new lifetime high of 22,040.72, the BSE Sensex closed up by 22.81 points at 21,832.61. It breached previous historic high of 22,023.98 logged on March 10.
Heavyweights like ITC, Maruti Suzuki, RIL and SBI notched up handsome gains but Tata Motors, Infosys, ICICI Bank, L&T and TCS ended with losses, restricting the Sensex's rise.
The Nifty edged up by 12.45 points, or 0.19%, to settle at 6,516.65. Like Sensex, it too formed a new lifetime high of 6,574.95 today. Its previous peak was 6,562.85 on March 11.
Jignesh Chaudhary, Head of Research, Veracity Broking Services said: "Indian indices posted new record taking cues from the better than expected data from the US, also the positive comments from Goldman Sachs that elections may fuel further gains in stocks." Gradual decline in index majors due to profit taking trimmed the initial gains and resultant flat closing in the end, according to Jayant Manglik, president-retail distribution, Religare Securities.
The BSE Midcap and Small cap indices firmed up 0.95% and 0.97%, respectively on buying by retail investors.
Mirroring the domestic stock benchmarks, the rupee was trading slightly positive against the US dollar after jumping to 60.86 in morning.
FIIs bought shares worth Rs 982.19 crore last Friday as per provisional data.
Key benchmark indices in China, South Korea, Taiwan, Hong Kong, Japan and Singapore rose by 0.05% to 0.94%.
European markets were trading lower in their early trade as investors waited for German economic data. Key benchmark indices in France, Germany and UK shed 0.19% to 0.57%.
Major Sensex gainers were Maruti Suzuki (7.58%), SBI (2.72%), ITC (2.56%), Coal India (2.48%), RIL (1.04%), Bajaj Auto (0.91%), Tata Power (0.90%), and NTPC (0.73%). However, Tata Motors fell by 3.03%, followed by M&M 1.51%, Wipro 1.23%, Infosys 1.19%, L&T 1.17%, ICICI Bank 0.97% and
New Delhi, March 18
Faced with dissent from institutional investors, including private sector mutual funds and state-run LIC, the carmaker last week decided to seek minority shareholders' nod for a proposal under which its Japanese parent Suzuki Motor Corp would implement a Gujarat plant.
Officials at some of the 16 private institutional investors (including mutual funds and insurance companies) have welcomed the company's decision to seek approval from minority shareholders, although they are waiting for the fine-print of the revised proposal to finalise next move.
Certain changes would also be made to the original plan before it is put for vote by Maruti Suzuki India Ltd (MSIL).
Foreign institutional investors (who hold 21.5% stake) would play a key role, as their stand is yet not clear.
"The proposed structure creates uncertainties and provides scope for misalignment of interests. When the proposal is put to vote, we are likely to advise voting against the proposal," InGovern Research Services founder and MD Shriram Subramanian said.According to him, the proposed structure is gravely unjust to minority shareholders.
"Suzuki should have infused funds into MSIL or increased their stake in MSIL through an open offer, with MSIL being their only investment platform in India," he noted.
Another proxy firm IiAS said Maruti's recent announcement doesn't change its fundamental objection to the deal.
As per the proxy firm, the deal is unnecessary and needlessly adds to the complexity and ambiguity of the operating structure.
"Maruti has enough liquidity to fund the entire capital expenditure at Gujarat, and its excess liquidity will be better used if it is invested in operations," IiAS said.
As per the revised plan for Gujarat project, Suzuki Motor Corp, through its wholly owned subsidiary, would make the investment through depreciation and the equity brought in by parent without 'mark-up' on cost of production.
In case of termination of the contract manufacturing agreement between them, the facilities of the Gujarat subsidiary would be transferred to Maruti Suzuki India Ltd (MSIL) at book value and not at fair value as was envisaged before.
Stock surges 7.6%
Mumbai: Shares of Maruti Suzuki India rose 7.6% on Tuesday after the company decided to seek minority shareholders' approval for the controversial Gujarat plant, which parent Suzuki Motor Corp decided to take over. After surging 9.37% to Rs 1,899.90, it closed at Rs 1,868.85, up 7.6% on the BSE. On the NSE, the stock settled at Rs 1,869.50, a gain of 7.54%. The scrip was the best performer on the key Sensex and Nifty indices. — PTI FIIs to play key role * Maruti Suzuki has decided to seek minority shareholders' nod for a proposal under which Suzuki Motor Corp would implement a Gujarat plant *
Certain changes would also be made to the original plan before it is put for vote by Maruti Suzuki *
FIIs, who hold 21.5% stake, would play a key role, as their stand is
not yet clear
Mumbai: Shares of Maruti Suzuki India rose 7.6% on Tuesday after the company decided to seek minority shareholders' approval for the controversial Gujarat plant, which parent Suzuki Motor Corp decided to take over.
After surging 9.37% to Rs 1,899.90, it closed at Rs 1,868.85, up 7.6% on the BSE. On the NSE, the stock settled at Rs 1,869.50, a gain of 7.54%. The scrip was the best performer on the key Sensex and Nifty indices. — PTI
FIIs to play key role
* Maruti Suzuki has decided to seek minority shareholders' nod for a proposal under which Suzuki Motor Corp would implement a Gujarat plant
* Certain changes would also be made to the original plan before it is put for vote by Maruti Suzuki
* FIIs, who hold 21.5% stake, would play a key role, as their stand is not yet clear
New Delhi, March 18
"The Board has decided to suspend the previously announced share buyback programme as of March 21 until the position regarding the Cairn India shareholding is resolved," the company said today.
Cairn Energy, which had in 2011 sold majority stake in its Indian unit to mining group Vedanta for $8.67 billion, still holds 10.3% stake in Cairn India which at today's trading price is worth about $1 billion.
The company faces a potential tax demand on an alleged Rs 24,500 crore of capital gains it made when in 2006 it transferred all its India assets to a new company, Cairn India and got it listed on stock exchanges.
Cairn Energy said it "is not able to sell" the residual shareholding in Cairn India "while interactions are ongoing with the Indian Income Tax Department".
The Income Tax Department had in a January 22 order held that the Edinburgh-based firm made capital gains of Rs 24,503.50 crore when it transferred its entire India business from subsidiaries incorporated in places like Jersey, a tax haven, to the newly incorporated Cairn India in 2006.aIt, according to the I-T Department, received Rs 26,681.87 crore for the asset transfer against its entire investment of Rs 2,178.36 crore in the India business. — PTI
Govt looks to raise
Rs 3,000 cr from PSU ETF
New Delhi, March 18
The new fund offer opened today for subscription by anchor investors (investing above Rs 10 crore) and will open tomorrow for non-anchor and retail investors. The offer for non-anchor investors closes on March 21.
Alok Tandon, Joint Secretary in the Department of Disinvestment, said though ETF is a popular investment vehicle globally, it is at a nascent stage in India. He said though equity ETFs are yet to gain traction here, through the CPSE-ETF, the government is trying to make this product popular.
The new index is another option for the government to divest stake in public sector firms, he said. The scheme is managed by Goldman Sachs India MF and will be listed on exchanges in the form of an ETF.
The Government plans to raise up to Rs 3,000 crore from this scheme in the current financial year, Tandon said. The success of the scheme would ensure the government meets the disinvestment target of Rs 16,000 crore.
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