Pantaloon gains 3% on FDI buzz

Pantaloon Retail is trading higher by nearly 3% at Rs 173.5, extending Wednesday’s 11% rally, on the buzz that the government may allow foreign direct investment (FDI) in multi-brand retail.

Retail stocks have been gaining ground on reports that a final cabinet note on FDI in retail is to be issued next week. Markets expect that the inter-ministerial discussions on FDI for the retail sector are likely to end on Friday. 100% FDI in single brand retail, which is currently capped at 51%, is likely to be approved by the Cabinet.

Meanwhile, merely a week ago, Pantaloon Retail had tumbled to a 52-week low on posting a 36.33% decline in its consolidated net profit for the first quarter ended September 30, 2011 to Rs 15.05 crore, compared to the same period last fiscal on account of higher expenses, including on raw materials.

The scrip opened at Rs 171.50 and has, so far, touched the day's high at Rs 176. Around 133,899 shares had changed hands on the BSE counter till 1022 hours.