The Bombay Stock Exchange Sensitive Index, Sensex, rose for the first time in five days, paced by Satyam Computer Services after the company said it would review “strategic” options and the board’s composition.
Satyam Computer, the nation’s fourth-biggest software services provider, gained 9.2 per cent, the most in more than two months. The stock rose as much as 18 per cent earlier.
The Sensex rose 204.60, or 2.2 per cent, to close at 9,533.52, snapping a four-day 7.6 per cent drop. The S&P CNX Nifty Index on the National Stock Exchange added 64.95, or 2.3 per cent, to 2,922.20. The BSE 200 Index advanced 2.2 percent to 1,140.27.
| GAINERS ALL | ||
| Name | 29-Dec-08 | %* |
| Satyam Computer | 148.25 | 9.41 |
| Jaiprakash Asso | 79.00 | 7.26 |
| Ranbaxy Labs | 232.20 | 7.03 |
| ICICI Bank | 444.50 | 6.35 |
| Grasim Ind | 1248.05 | 5.02 |
| Reliance Commun | 212.85 | 3.83 |
| *Change over previous close | ||
“The fact that Satyam is exploring strategic options indicates that they are doing something to correct the situation,” said Apurva Shah, head of research at Mumbai-based Prabhudas Lilladher. “The strategic option means that they may bring in an outside investor.”
Satyam Computer gained Rs 12.45 to 148.10. The company may reorganise its board and pursue “strategic” options after a $1.6 billion attempt to buy companies related to the founding family drove the stock to its lowest in more than five years.
Satyam, led by Chairman Ramalinga Raju and his brother, drew more criticism a week later as the World Bank said it imposed an eight-year ban on the company for providing “improper” benefits.
Ranbaxy Laboratories and Novartis India led gains among drugmakers controlled by overseas companies on expectation that they may give higher dividends to shareholders. Ranbaxy rose 7 per cent, its biggest gain in almost two months.
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“There is a lot of cash available with the multinational pharmaceutical companies which can be distributed in form of dividends or they may announce a stock buyback programme,” said Ranjit Kapadia, an analyst at Prabhudas Lilladher. Ranbaxy rose Rs 15.15 to 232.05. Novartis India gained Rs 17.55, or 7.5 per cent, to 251.10.
Airline stocks rose after it was reported that Jet Airways (India) and Kingfisher Airlines will cut fares. Media reports said Jet and Kingfisher will cut ticket prices from January 1 after fuel prices declined. Jet will cut fares by as much as 40 per cent, according to the report, which cited an unidentified company official. Jet Airways rose Rs 4.90, or 2.6 per cent, to 190.85. Kingfisher Airlines gained Rs 2.45, or 7 per cent, to 37.25.
The Sensex has declined 53 per cent this year on concern that the economy may slow and as overseas investors withdrew from Indian stocks. The measure is set for its first drop in seven years.
Overseas funds sold a net Rs 2.2 billion ($45 million) of local stocks on December 24, increasing the outflow from stocks this year to $13 billion, the nation’s market regulator said.
Jindal Steel & Power rose Rs 43.10, or 5 per cent, to 905.05. The owner of the biggest non-state electricity generation plant in India will invest Rs 10,000 crore in four years to set up a thermal power plant. The plant, with a total capacity of 2,400 megawatts, will be located in the central state of Chhattisgarh.
Tata Motors retreated 4.3 per cent to a three-week low of Rs 148.95. The Mail on Sunday reported the maker of Jaguar and Land Rover vehicles may invest about 700 million pounds ($1.03 billion) after negotiations with the UK government.
Wockhardt fell Rs 1.50, or 1.4 per cent, to 108.40. The drugmaker plans to raise Rs 500 crore by selling preference shares, a newspaper reported, citing a company filing to the Bombay Stock Exchange.