Nifty breaks 6250; BHEL falls 2%, pharma stocks weak

Moneycontrol Bureau Live Market Commentary

2:00 Should Sebi intervene?Just as the dust was beginning to settle on the Fresenius Kabi delisting controversy, another MNC's action has reignited the debate on whether the delisting guidelines are being gamed by promoters looking for a cheap exit.

AstraZeneca Pharma today said that its board would be meeting on Wednesday to consider a proposal to delist the company. The foreign parent holds 75 percent in the company, having reduced stake from 90 percent in May last year through an offer for sale (OFS) to institutional investors at Rs 620 per share. AstraZeneca had taken the OFS route to comply with the Sebi rule mandating listed companies to maintain minimum 25 percent public shareholding.

To delist, the foreign parent now needs to buy an additional 15 percent from investors. Under current rules, promoters with less than 90 percent stake looking to delist, have to make an offer for minimum 50 percent of the outstanding equity and take their stake to 90 percent. For promoters holding 90 percent and above, the offer has to be for a minimum of 50 percent of the outstanding equity. 

1:50 pm Gold check: The government has started to make physical checks of gold stocks held by wholesalers to ensure inventories match the amount imported by banks and state-run traders, an industry association said, as the country steps up efforts to halt smuggling, reports Reuters.

The move could aggravate shortages in the physical market as authorities seize gold without a valid provenance, boosting premiums, which rallied to a record of USD!60 an ounce on London prices late last year.

"Government agencies are raiding and seizing gold at various places and asking to reconcile the (gold bar) number with the imported gold," said India Bullion and Jewellers Association (IBJA) general secretary Surendra Mehta.

1:40 pm Auto sales: Pune-based auto maker Bajaj Auto today reported a 7% decline in motorcycle sales at 2,81,390 units in January 2014. The company had sold 3,01,361 bikes in January 2013, Bajaj Auto Limited said in a release here. The overall domestic sales including commercial vehicles also fell by 8 per cent during January 2014, it said. Bajaj Auto sold 3,18,177 vehicles in the reporting month as against 3,47,624 units sold a year ago, the company said.

1:30 pm Buzzing: Shares of HT Media surged 7 percent intraday on Monday as maverick investor Rakesh Jhunjhunwala bought some shares in the company. Rakesh Jhunjhunwala's firm Rare Enterprises purchased 15 lakh shares of the media company for about Rs 11 crore through open market route.

As per BSE data, Rare Enterprises purchased the company's shares at an average price of Rs 71.25 apiece, valuing the transaction at Rs 10.69 crore.

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The market is extending losses following weak global cues due to political uncertainty in Ukraine. The Nifty has slipped below the 6250 level. The Nifty is down 36.25 points at 6240.70 and the Sensex is down 104.28 points at 21015.84. About 1169 shares have advanced, 1216 shares declined, and 118 shares are unchanged.

ITC, Reliance, Hindalco, GAIL and Tata Power are top gainers in the Sensex. Among the losers are Dr Reddy's Labs, BHEL, Cipla, Sun Pharma and Tata Motors.

Ukraine's new PM has accused Russia of declaring war on the country. This is after Russia moved troops to three bases in Crimea on Sunday. The G7 has condemned Russia’s intrusion into Ukraine and canceled preparations for the G8 summit that had been scheduled to take place in Sochi in June.

Meanwhile, Russia's central bank has raised interest rates from 5.5 percent to 7 percent, in an effort to stabilise its currency and offset inflation.

Asian markets see flight to safety on brewing instability in Ukraine. The Nikkei was down over a percent.

In other asset classes, crude jumped over 1 percent, to multi-month highs, lifted by rising tension in Ukraine, Nymex rises to USD 104 per barrel. Gold too jumped more than a percent.