Delivery volume in May up 14% amid market turmoil

The delivery volume in May 2004 was up 14.32 per cent on the Bombay Stock Exchange (BSE) and the National Stock Exchange (NSE) despite turbulent stock markets.

The major volume drivers were the BSE Sensex stocks which saw delivery-based volumes zooming 28.80 per cent. The deliveries in non-index stocks moved up at a slower pace of 10.54 per cent.

The delivery data for May 2004 reveal that foreign institutional investors (FIIs) were delivery-based sellers, while local mutual funds were delivery-based buyers. FIIs were net sellers to the tune of Rs 3,251 crore, while mutual funds purchased Rs 1,018 crore of equities.

FII trading touched an all-time high in May, with a gross turnover of Rs 34,703 crore, accounting for 24 per cent of the total turnover on the BSE and the NSE. The FIIs made delivery-based selling of Rs 18,282 crore and delivery-based buying of Rs 15,010 crore in May.

On the other hand, local mutual funds were net buyers to the tune of Rs 1,018 crore. These funds purchased shares worth Rs 4,855 crore and sold shares worth Rs 3,837 crore.

The delivery pressure resulted in an almost 18 per cent dip in the market valuation of Sensex stocks in May. The Centre's decision to relook at the power sector policy hammered Reliance Energy (down 32.94 per cent) and Tata Power (down 30.99 per cent) in May.

The fear of restricting foreign direct investment in the banking sector halted the upward movement in ICICI Bank which was down 26.92 per cent and State Bank of India (SBI) declined by 27.64 per cent.

The decision of the United Progressive Alliance (UPA) government at the Centre to not privatise profitable public sector units (PSU) hit trading in state-run company stocks.

Following this, Hindustan Petroleum Corporation Ltd (HPCL) was down 34.71 per cent, BHEL down 25.80 per cent, Oil and Natural Gas Corporation (ONGC) down 25.54 per cent and Mahanagar Telephone Nigam Ltd (MTNL) was down 24.49 per cent.

The fall in the prices of public sector stocks was aided by delivery-based selling. The deliveries in BHEL was up 79.28 per cent to 134.82 lakh shares in May as against 75.20 lakh shares in April.

Deliveries in HPCL was up 32.1 per cent to 247.53 lakh shares from 162 lakh shares. The deliveries of SBI and MTNL surged over 22 per cent each, while ONGC reported an around 13 per cent drop in delivery volume.

Cipla was down 14 per cent on a 180 per cent rise in deliveries, while Hindalco fell by 18.9 per cent on a 160 per cent rise in delivery volume. Maruti dipped by 28.9 per cent, with its delivery volume zooming by 140 per cent.

ITC was down 18.2 per cent with its delivery volume soaring by 122 per cent and Tata Motors down 22.5 per cent on account of a 120 per cent rise in deliveries.