Shares of three organised retailers fell 1.43% to 2.73% at 11:31 IST on BSE on reports that the Delhi government has written to DIPP seeking to withdraw its permission to allow FDI in multi-brand retail in the state.
Meanwhile, the S&P BSE Sensex was down 59.82 points, or 0.28%, to 21,074.39
Trent (down 2.73%), Shoppers Stop (down 1.55%) and Future Retail (down 1.43%) declined.
Trent had outperformed the market over the past one month till 13 January 2014, rising 15.69% compared with the Sensex's 2.02% rise. The scrip also outperformed the market in past one quarter, gaining 26.58% as against Sensex's 2.95% rise.
Shoppers Stop had outperformed the market over the past one month till 13 January 2014, rising 10.83% compared with the Sensex's 2.02% rise. The scrip also outperformed the market in past one quarter, gaining 15.95% as against Sensex's 2.95% rise.
Future Retail had outperformed the market over the past one month till 13 January 2014, rising 23.65% compared with the Sensex's 2.02% rise. The scrip also outperformed the market in past one quarter, gaining 10.65% as against Sensex's 2.95% rise.
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Shares of organised retailers declined today, 14 January 2014 on reports that the Aam Aadmi Party-headed Delhi government has written to the department of industrial policy and promotion (DIPP) seeking to withdraw its permission to allow FDI in multi-brand retail in the state. The decision of the Aam Aadmi Party government may make foreign retailers more wary of entering the Indian market. It also throws the FDI policy in retail into more political uncertainty ahead of general elections expected in April-May.
The central government approved a policy in September 2012 allowing 51% FDI in multi-brand retail, but left it to the discretion of individual state governments whether or not to allow supermarkets partially owned by foreign retailers. Delhi, Maharashtra, Jammu and Kashmir, Haryana, Rajasthan, Uttarakhand, Andhra Pradesh and Assam have in the past agreed to support the entry of foreign supermarket chains such as Wal-Mart Stores Inc. of the US and Tesco Plc of the UK. The previous Delhi government under Sheila Dikshit of the Congress, which was defeated in Delhi assembly elections held on 4 December 2013, supported FDI in multi-brand retail.
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