The News International Team
12:30pm Modi on Defence
Prime Minister Narendra Modi has asked global defence contractors to transfer more technology to India as part of the lucrative deals that they win to modernise its armed forces.
The country’s offsets policy, which requires contractors to invest a percentage of the value of the deal in India, will be tweaked to encourage more technology transfer, and less simple assembly or production, Modi said at the opening ceremony of the Aero India airshow at Yelahanka air base in Bengaluru.
“We have the reputation as the largest importer of defence equipment. This may be music to the ears of some of you. But this is an area where we do not want to be number one,” Modi said before an air display of Indian military planes.
“It will no longer be enough to buy equipment and simply assemble here.”
India is forecast to spend USD 250 billion over the next decade to upgrade its military, which still largely relies on Russian equipment it bought from the 1960s to the 1980s, and catch up with strategic rivals like China, reports Reuters.
12:00pm Market Check
It is a stable session for the market with key indices gaining half a percent, aided by consumer durables, capital goods and realty names. The broader markets traded in-line with the frontliners; the BSE Midcap and Smallcap indices gained 0.7 percent and 1 percent, respectively.
The 30-share BSE Sensex climbed 153 points to 29288.88 and the 50-share NSE Nifty advanced 41.20 points to 8850.55. About 1507 shares have advanced, 1034 shares declined, and 191 shares are unchanged on the BSE.
Hero Motocorp slumped near 5 percent post a block deal where the promoters sold 3.5 percent stake or 71 lakh shares in multiple blocks between Rs 2,664 to Rs 2,718 a share. Promoters hold 36.4 percent stake post these block deals.
Defence stocks like Astra Microwave, Bharat Electronics and BEML rallied 5-10 percent post Prime Minister’s push for the sector. Speaking at the Aero India show, Modi commits to doubling output in defence manufacturing with preference to be given to ‘Made in India’ defence products.
Pipavav Defence surged 13 percent on market buzz that Mahindra & Mahindra may soon announce buyout of 25-30 percent stake in the company followed by an open offer. Reports suggest that M&M may pump in Rs 3,000 crore into the deal which values Pipavav Defence at an enterprise value of Rs 12,000 crore.
Suzlon Energy jumped another 15 percent to take it’s weekly winnings to 40 percent as the government stressed on renewable energy. Finance Minister Arun Jaitley hinted at a major push for green energy in the upcoming Budget. Experts too called Dilip Shanghvi’s bet on Suzlon as a game changer for the beleagured stock.
In Asia, Nikkei raced to a multi-year high on low volumes as key markets like China and South Korea remained closed for the lunar new year. Brent Crude hit a 2-month highs of USD 63 a barrel on short covering as well as concerns regarding unrest in Libya.