The News International Team
01:59pm Tata Steel on buyers’ radar
Shares of Tata Steel saw excellent rebound, up more than 3 percent intraday after brokerages said the Supreme Court (SC) order on coal block allocation case will not have any major impact on the company. However, the stock fell nearly 5 percent in previous session.
“Tata Steel India gets 40 percent of its coking coal needs through captive coal mines; however, all these coal mines (mainly in West Bokaro and Jharia regions) were allocated pre-1993,” said Goldman Sachs.
CLSA agreed with Goldman, saying there is no impact on Tata Steel since its captive coking coal mines were allocated pre 1993.
The Supreme Court verdict terming all coal block allocation since 1993 as illegal will have major implications on all parties related. Besides mining, power and metal space, it is likely to impact banks as well which have exposure to power sector.
In an interview to CNBC-TV18, Ranjan Dhawan, Executive Director, Bank of Baroda, said the bank’s exposure to the power sector stands below 7 percent, while in iron and steel sectors it is around 5.25 percent.
Dhawan does not think the impact of SC ruling will be too profound, but feels investors should wait and watch. He expects SC’s September 1 order to give further clarity on the matter.
He said the government is focused on reviving and resolving the issues in the power sector, thus he does not see a permanent status quo being maintained on the coal block issue.
01:25pm Snowman Logistics IPO opens
Snowman Logistics (SLL), an integrated temperature-controlled logistics services provider, has opened its 4.2 crore shares initial public offer (IPO) for subscription on August 26.
The company has fixed price band at Rs 44-47 per share for the issue, which will be opened till August 28. Retail investors can apply for up to 10 percent of the total issue size and 15 percent portion is reserved for non-institutional investors while the balance 75 percent is available for qualified institutional buyers.
Bids can be made for minimum 300 equity shares and in multiples of 300 shares thereafter. Accordingly, the retail investors can apply for maximum 4200-4500 equity shares (at given price band).
The largest cold chain solutions provider aims to raise Rs 197 crore (at higher end of price band) through this issue, which will be used for setting up new temperature controlled and ambient warehouses, and long term working capital.
The company, which operates 23 temperature-controlled warehouses across 14 locations in India (including Kolkata, Mumbai, Delhi, Chennai and Bengaluru), proposes to set up another such 6 and 2 ambient warehouses at 6 cities at the cost of around Rs 140 crore.
It has a pan-India presence with warehousing capacity of 58,543 pallets and 3,000 ambient pallets, which is expected to increase to 85,000 pellets in current financial year (FY15) and further to 1 lakh pellets by FY16, said the company in its prospectus.
01:00pm The market remained in negative terrain with the 50-share NSE Nifty struggling at 7900 weighed down by banks, capital goods, power and oil & gas stocks. However, healthcare, FMCG and technology stocks continued to see buying interest.
The Sensex fell 44.48 points to 26392.54 and the Nifty declined 18.40 points to 7887.90. Declining shares outnumbered advancing ones by a ratio of 1676 to 1012 on the Bombay Stock Exchange.
Hindalco Industries, Jindal Steel, Tata Steel, Kotak Mahindra Bank, Dabur India, HDFC and State Bank of India were the most active shares.
ONGC and Tata Power kept top position in the selling list, down over 3 percent followed by L&T, SBI, Axis Bank, Maruti Suzuki, NTPC, BHEL and Coal India with 1-2 percent. However, shares of Sun Pharma, Hindustan Unilever, Tata Steel, Hindalco, Cipla and GAIL gained 1-2.5 percent.