Indian stocks to open sideways: Tuesday Market Preview

The damage-control exercise by the government is expected to provide some relief

The Indian market is likely to open sideways after the government clarified that there is no need to panic as while the Centre is keen on reviewing the double tax avoidance treaty with Mauritius no date has been fixed for talks between the two countries. Easing of debt tensions in Greece led the US markets end higher overnight and markets in Asia to open higher in early trade on Tuesday. The SGX Nifty gained eight points to 5,273 compared to its previous close of 5,265.

The domestic market witnessed mayhem among blue-chip stocks on Monday, settling with deep cuts on reports that the government may review the double taxation treaty with Mauritius, a major channel of funds into India. Stock-specific news also contributed to the slide.

The market opened with minor gains, with investors cautious due to concerns over the possible ripple-effect of the debt crisis in Europe. The Sensex resumed trade at 17,925, up 54 points from its previous close and the Nifty was six points higher at 5,372. The opening on the Sensex was its intra-day high and the Nifty scaled its high soon after, touching 5,377.

Talk about a likely review of the double taxation avoidance agreement with Mauritius pushed the indices to the day's low in the first hour of trade. At the intra-day lows, the Sensex dived 557 points to 17,314 and the Nifty retraced 170 points at 5,196.

The market bounced back from the day's low and was range-bound in subsequent trade, ending sharply lower. The Sensex closed at 17,507, a huge 364 points drop and the Nifty finished at 5,258, a 109 points slump.

These closing lows on the Sensex and the Nifty were last seen on 11 February 2011. The market has broken recent bottoms and has reached the level touched four months back. The indices are set to fall further with no immediate support in view. To know where the market will head in the next few days watch for today’s move. If Monday’s lows hold, we can expect some stability.

Wall Street closed higher overnight on easing of Greece’s debt problems after euro zone finance ministers gave Greece two weeks time to approve harsher austerity measures in return for more emergency loans. Investors resorted to bargain hunting after the recent decline in the markets. However, analysts opined that the downtrend may not be over. Meanwhile, the keenly watched two-day meeting of the Federal Open Market Committee (FOMC) gets underway tonight. The FOMC is expected to refrain from making any comment for another round of quantitative easing and is also expected to hold rates steady between zero and 0.25%.

The Dow gained 76.02 points (0.63%) to end at 12,080.38. The S&P 500 added 6.86 points (0.54%) to 1,278.36 and the Nasdaq rose 13.18 points (0.50%) to 2,629.66.

Markets in Asia were in the green in early trade today, supported by easing of Greece’s debt issues. Meanwhile, China’s central bank has tightened controls on offshore yuan deals to curb speculation in the currency. Under the rules, offshore banks that settle trade in the Chinese currency must tighten checks on clients’ yuan transactions to ensure any buying or selling of the currency is backed by ‘real’ trade or business needs.

The Shanghai Composite gained 0.48%, the Hang Seng rose 0.69%, the Jakarta Composite climbed 0.65%, the KLSE Composite added 0.03%, the Nikkei surged 0.89%, the Straits Times was up 0.73%, the Seoul Composite rose 0.55% and the Taiwan Weighted was 0.55% higher.

Back home, the Cabinet Committee on Economic Affairs (CCEA) may this week consider giving nod to London-listed mining group Vedanta Resources’ $9.4 billion takeover of Cairn India after imposing stringent conditions.

Oil minister S Jaipal Reddy said the CCEA, chaired by prime minister Manmohan Singh, may meet this week to consider giving the government nod based on recommendations of a Group of Ministers that went into the issue of granting approval to Cairn India’s parent firm, Cairn Energy, selling its stake to Vedanta.


Lalit Modi tweets, “BCCI systematically scuttled Indian Cricket League”

Lalit Modi, the controversial former commissioner of the Indian Premier League has been revealing some allegedly hidden secrets on Twitter

Lalit Modi has been revealing some of shocking inside information that suggests that the Board of Control for Cricket in India (BCCI) destroyed competition from the Indian Cricket League (ICL), in order to keep its own Indian Premier League (IPL) alive.

ICL, was a private cricket league funded by Zee Entertainment Enterprises which was conducted in India between 2007 and 2009. While its establishment pre-dated the IPL, the ICL folded up in 2009. Aside from the commercial aspects, the ICL lacked the support of the BCCI.

Here is what Lalit Modi, who shot into the limelight during his stint as chairman and commissioner of the IPL, said about BCCI, ICL and IPL on Twitter on Monday.

  •   @LalitKModi When I was at BCCI - the mandate given then was to scuttle ICL. BCCI arm-twisted every cricket board and ICC to change their constitution.
  •   @LalitKModi The constitution of every board was changed and ICC made ICL redundant by its act - by making it unauthorised cricket.
  •   @LalitKModi Worldwide anti-competition laws were studied and finally thou against most laws - the ICC changed their constitution to protect its members.
  •   @LalitKModi When you work for an organisation - and it gives you a mandate to do something then - its one job to do that to the best of his ability.
  •   @LalitKModi Yes, I was part of the BCCI when we scuttled ICL. That was the mandate of the organisation. It was not my personal agenda.
  •   @LalitKModi I have no personal issues with ICL. I am of the personal opinion that more competition in the game is good for the game and its players.
  •   @LalitKModi I have always done what's required by any organisation I have worked with. Well I guess I do my job well. That's why I give results.
  •   @LalitKModi Yes, we were afraid of Subhash Chandra's clout in the media and ability to take over the World of Cricket. Internally we ...
  •   @LalitKModi All correspondence related to scuttling ICL and any unauthorised league - will be made available on my website soon.
  •  @LalitKModi I have read many messages regarding ICL. Yes, I admit it was a mistake to have systematically used everything in BCCI's arsenal to finish ICL.
  •   @LalitKModi Yes, we as BCCI called all and sundry to oppose ICL. Cricket associations were told not to give their grounds or fear losing matches.
  •   @LalitKModi Advertisers were called and told if you advertise on ICL then you will be barred from all BCCI cricket by the BCCI. ...
  •   @LalitKModi Players were told do not play for ICL or we will blacklist you. This then BCCI had to implement thru change of constitution.
  •   @LalitKModi BCCI even terminated Zee Sports contract unfairly as they had launched ICL and BCCI wanted window for IPL. Which I am told is in court now
  •    @LalitKModi The final Straw was to offer ICL players an amnesty Scheme so that they would desert ICL and join IPL.
  •   @LalitKModi Commentators were called and told do not associate with ICL or BCCI will ensure we will not take you. Umpires were ...
  •  @LalitKModi BCCI than called every member of ICC to ensure that they all help in changing the ICC constitution to outlaw ICL.
  •  @LalitKModi ICC set up a three member committee with ME, Giles Clarke President ECB and Norman Arendse President CSA to draft the new constitution.
  •   @LalitKModi We drafted the same and then BCCI ensured it was approved and implemented with lightening speed. Result - Demise of ICL.
  •   @LalitKModi BCCI even went to the extent of black listing suppliers like Tv Production cos, Event Managers who worked with ICL.
  •    @LalitKModi ICC used Bird and Bird a UK-based law firm to ensure Regulations to stop ICL was made consistent Globally. The 3 member Team worked with them
  •    @LalitKModi Yes I was part of BCCI and ICC when these decisions were taken. I am not denying that. All I am doing is telling you what happened.
  •    @LalitKModi Whether it is right or wrong - that question needs to be asked from the organizations. I did not run them - only part of them.
  •    @LalitKModi Why am I revealing all this now - I always said I will reveal everything one day. So what better day to start then Today.
  •   @LalitKModi BCCI used Champions League to induce other ICC members to Vote on the resolution to outlaw ICL, that way they get ...




5 years ago

I wonder what prevents the government from exercising its power over this body? BCCI is behaving like a sheer dictator.

1. Scuttle ICL;

2. Not signing WADA treaty ;

3. Not agreeing to be a part of Govt's proposed law of bringing all sports bodies under one umbrella;

4. The latest being denying permission for Indian Cricketers to play in SL T 20 league.

Can nothing be done against this body and the people who are running the show?


5 years ago

Is this written by a Journalist ?
God save Money control ......

GTL Ltd stock price slumps 62% on huge volumes; company denies promoters selling stake

Analysts describe it as market reaction to company’s scrapping plans to raise $300 million. Group company GTL Infrastructure slides 43%

The shares of GTL group tanked amidst speculations of heavy selling of the company's pledged shares, a charge which the company has denied. But market experts believe that such kind of aggressive selling happens mainly when the company's pledged shares are sold in the open market.

The GTL share prices have been falling since Friday and today GTL Limited crashed to Rs127.80, a fall of around 62% and group company GTL Infrastructure fell by 43% to Rs16.85 on the Bombay Stock Exchange.

The share price slump was on a sharp surge in trading volumes. The total trading volume from the BSE and the NSE (National Stock Exchange) for GTL Limited rose to 7.33 crore shares today, from around 16 lakh shares on Friday. For GTL Infrastructure, today's trading volumes stood at a huge 16.05 crore shares from a mere 14.72 lakh shares in the previous trading session.

This indicates the possibility that promoters' pledged equity has been sold. For instance, it could be a bank, with whom the company has pledged shares for raising funds, and the financial entity could have sold the shares. Such large trading transactions are very confidential and only the involved parties are aware of the same.

In GTL Limited, the promoters hold 52.71% of the equity capital, out of which the promoters have pledged only 12.85%.

The company denied selling off its pledged shares, or that any shares were sold by Technology Infrastructure, which holds 11% in GTL. Chairman Manoj Tirodkar was quoted in a report as saying, "Promoters' equity that is pledged for the purpose of acquisition of towers or otherwise has not been sold out. I'm categorical about that. As early as Friday we have spoken to them (Technology Infra) and they are a long-term investor, they have committed that they will remain with the company so there is no reason for me to believe that that would have changed from Friday to now."

Meanwhile, the stories in the media suggest that the company has scrapped its plan to raise $300 million. Analysts believe that the stock has sharply reacted to it. "The company's debt plan of around $3 million has been scrapped. This raises doubts on the credibility of the management. Further, the company will face problems in raising funds. The stock has reacted negatively mainly because of this news," an analyst with a broking firm told Moneylife, preferring anonymity.
GTL Ltd issued a clarification to the BSE stating that, "The company would like to confirm that neither promoters nor entities relating to promoters have sold any shares, including the shares that have been pledged."

Similarly, GTL Infrastructure issued a clarification. The company said, "The company has never launched any roadshow for the above said issue. We believe that the present market conditions, policy clarity on the telecom sector and global market sentiments are not favourable for the issue at this stage. We would like to inform you that the company is in a highly capital-intensive business and it will raise funds at appropriate times. We will keep the stock exchanges updated of any developments on this matter. The promoters and promoter group have not pledged any shares."

GLT replied to the e-mail query sent by Moneylife stating that, "We were informed by all our long-term investors including Technology Infrastructure Fund that they have not sold their holding." The company also sent the clarification letter (details mentioned above) sent to the stock exchange by them.




5 years ago

short termm gtl target price 159-186
expert view


5 years ago

I found 7 major NET sellers of GTL in NSE's bulk deals list.

None on BSE.

None for GTL Infrastructure.

Together these 7 entities have sold around 51 lac shares out of the 87 lac shares that were marked for delivery.

I could not find any information on these 7 entities. All are private companies and possibly related to each other.



In Reply to sachin 5 years ago

I wish we will know soon what is going on. I seriously believe SEBI should look in to this issue. All investors of this company have rights to know what is so wrong with it. As per if company management come back tomorrow with a buy back option, the share should pick up else we sld assume some thing is seriously wrong.


In Reply to Sanjiv 5 years ago

For buyback, a company needs idle cash, which GTL doesn't have.

Thus even if GTL does announce a buyback, I doubt the company will actually buyback any significant number of shares.

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