|
| Sensex at a month's low; Satyam soars | |
| Bloomberg / Mumbai January 13, 2009, 0:17 IST | |
India’s key stock index Sensex fell for a third day to its lowest in a month.
Wipro, the nation’s third-largest software exporter, slid after the World Bank made public that it had barred the IT firm from bidding for its contracts until 2011.
Wipro dropped 9.4 per cent, the most in almost three months, after admitting it had been punished for selling shares to employees of the financial institution in its initial public offering (IPO). Infosys Technologies, India’s biggest technology company by market value, fell 3.6 per cent.
“Indian markets will under-perform global markets because of these events,” said Sandip Sabharwal, chief investment officer at the Mumbai-based J M Financial Mutual Fund, which manages assets worth $1.2 billion in equities and bonds. “In this environment, companies will make disclosures just to be sure they aren’t perceived to be lacking in transparency,” he said.
The Sensex fell 296.42, or 3.2 per cent, to 9,110.05, its lowest since December 5. The Nifty dropped 3.5 per cent to 2,773.10. The BSE 200 Index slumped 3 per cent to 1,091.37. Nifty futures for January delivery declined 4.1 per cent to 2,745.
Wipro fell 9.4 per cent to Rs 227.40, the most since October 24. World Bank employees, their family and friends bought 1,750 Wipro shares for about $72,000 at the IPO price, Wipro said. The purchase didn’t violate any ethics or conflict of interest policies, the company said in an e-mailed statement today. Its business with the World Bank is minimal, the Bangalore-based company said. The ban took effect in 2007, it added.
Infosys fell 3.6 per cent to Rs 1,159.70, its lowest since January 2. The company is to report its earnings for the quarter ended December 31 tomorrow.
However, Satyam Computer Services jumped 45 per cent to Rs 34.40, the most since November 1992, on the expectation that a new government-appointed board will draw up a rescue plan for the company at the centre of India’s biggest corporate fraud. The shares also gained on speculation that investors were covering their short-selling positions after the National Stock Exchange (NSE) said the shares would be removed from its derivatives list. Short-selling occurs when investors attempt to sell borrowed shares and buy them back at a lower price.
The Hyderabad-based Satyam lost 87 per cent in the past two trading sessions after its Chairman Ramalinga Raju admitted that he had falsified accounts, overstating assets by more than $1 billion. Raju quit and he and his brother Rama Raju have since been arrested. The World Bank had also banned Satyam last month from bidding for orders for eight years, citing “improper benefits” offered to the bank’s employees.
The company will be removed from the list of stocks eligible for derivative trades starting on Jan. 29, the National Stock Exchange said on Jan. 9.
State Bank of India, the nation’s largest lender, slid 5.1 percent to 1,158.90 rupees. State Bank has loaned 5 billion rupees ($102 million) to the Maytas group of companies, the lender’s Chairman Om Prakash Bhatt told NDTV Profit channel.
Stocks that recorded the biggest declines on the Sensex today include Tata Steel Ltd., the nation’s biggest maker of the alloy, and Ranbaxy Laboratories Ltd. DLF Ltd., the No. 1 real- estate developer, fell 5.4 percent to 204.75 rupees, its lowest since Dec. 5.
Ranbaxy
Ranbaxy fell 5.8 percent to 206.50 rupees, the lowest since Dec. 3. Tata Steel dropped 6.9 percent to 200.15 rupees, the lowest since Dec. 8.
Overseas funds bought a net 10.6 billion rupees of Indian stocks on Jan. 7, the nation’s market regulator said.
The following were among the most active shares traded on the Bombay and National stock exchanges. Stock symbols are in parentheses after company names:
Axis Bank Ltd. (AXSB IN) dropped 34.90 rupees, or 7.2 percent, to 451.70, its lowest since Dec. 5. The Indian lender’s stock price estimate was cut by 14 percent to 645 rupees a share at Macquarie Research and by 2 percent to 553 rupee at JPMorgan Chase & Co.
Maytas Infra Ltd. (MAY IN): The Indian real-estate developer founded by Ramalinga Raju dropped 7.5 rupees, or by its 5 percent limit, to 143.30, extending a two-day 9.7 percent decline. Satyam Computer Systems Ltd.’s fraud investigators are broadening their probe to at least two property and infrastructure companies linked to Raju, the Wall Street Journal reported, citing an unidentified Indian official.
Unitech Ltd. (UT IN) slid 1.85 rupees, or 5.1 percent, to 34.15. The Indian developer is seeking rescheduling of the payment of loans worth 8 billion rupees taken from Indian state-run banks, the Economic Times reported, citing the Indian company’s head of planning and strategy R. Nagraju.
|
|
Content Guide
