Benchmarks continue lackluster trade in afternoon deals

Indian equity indices continued lackluster trade in afternoon session, hovering in negative territory as traders remained on sidelines ahead of the Reserve Bank of India’s monetary policy committee’s (MPC) meeting, which is widely expected to lower interest rates in the wake of cooling inflation. Sentiments remained subdued after finance minister Arun Jaitley cautioned that the fiscal deficit of states may rise this year, with states likely to tap the markets to raise funds to finance farm debt waivers. Further, losses in the Metal, FMCG, Capital Goods, Industrials and IT stocks too dampened the mood. In scrip specific development, Lupin was up by over two percent after receiving US drug regulator's final approval to market a generic version of County Line Pharmaceuticals' Lidex ointment.

On the global front, Asian markets were trading in green, following the positive cues from Wall Street, with gains led by technology stocks after Apple reported better-than-expected financial results for the third quarter overnight. Investors also digested mostly upbeat earnings results from major Asian companies. Back home, the BSE Sensex is currently trading at 32555.64, down by 19.53 points or 0.06% after trading in a range of 32532.22 and 32686.48. There were 11 stocks advancing against 20 stocks declining on the index.

The broader indices were trading mixed; the BSE Mid cap index was down by 0.25%, while Small cap index was up by 0.20%.

The top gaining sectoral indices on the BSE were Utilities up by 0.75%, Realty up by 0.65%, Energy up by 0.63%, Consumer Durables up by 0.60% and Power up by 0.59%, while Metal down by 0.76%, FMCG down by 0.53%, Capital Goods down by 0.42%, Industrials down by 0.32% and IT down by 0.19% were the top losing indices on BSE.

The top gainers on the Sensex were NTPC up by 3.88%, Hero MotoCorp up by 2.52%, Lupin up by 2.26%, Reliance Industries up by 1.32% and Axis Bank up by 1.26%. On the flip side, Dr. Reddy’s Lab down by 1.18%, Asian Paints down by 1.10%, Tata Motors down by 1.10%, ONGC down by 1.02% and Bajaj Auto down by 1.00% were the top losers.

Meanwhile, a joint study carried out by the industry body Associated Chambers of Commerce & Industry of India (ASSOCHAM) and NEC Technologies has stated that India will need to significantly speed up the pace of solar capacity additions by 10,000 MW this fiscal and over 15,000 MW per year in order to meet the 2022 target of 1,00,000 MW (100GW), which the government set up in 2014. The study also noted that the country’s installed solar capacity fell short of target of 17,000 MW by the end of FY17.

Pointing to the efficiency of solar cells as the biggest technological issue, the joint report titled ‘Capacity Building and Skill Development' stated that currently, the efficiency ranges from 12-20 percent, though this continues to improve. It also said that the rest of the energy striking the panel is either reflected or is wasted as heat. It also explained that the main issue with efficiency is that higher efficiency solar panels cannot be commercially mass produced.

To achieve the 100GW target by 2022, the study further stated that the focus has slightly shifted from indigenous manufacturing as policies to curb the imports from other countries are not benefiting the domestic manufacturing. On the GST front, the study stated that the increase in taxes in the GST structure in solar from zero percent to 5 percent, along with reduced taxes in coal from 11.69 percent to 5 percent, may lead to slow adoption of solar in the Indian energy sector. It added that lack of uniform policies across sectors and implementation issues is also an area of concern. 

Highlighting the fact that foreign investment in Indian solar industry currently is less than 20 percent, the study said  even 100 percent FDI under automatic route and 74 percent through foreign equity participation in a joint venture (without approval) have not paved the way for significant foreign investments in Indian solar industry. It noted that the solar panels used in India are not designed to handle very high temperatures and dust prone conditions. Because of this, it said that module damage is common and results in loss in energy generation.

The CNX Nifty is currently trading at 10099.65, down by 15.00 points or 0.15% after trading in a range of 10091.70 and 10137.85. There were 19 stocks advancing against 32 stocks declining on the index.

The top gainers on Nifty were NTPC up by 3.66%, Hero MotoCorp up by 2.36%, Lupin up by 2.27%, Reliance Industries up by 1.29% and Axis Bank up by 1.29%. On the flip side, Indiabulls Housing Finance down by 1.52%, Dr. Reddy’s Lab down by 1.40%, Bajaj Auto down by 1.22%, Asian Paints down by 1.07% and ONGC down by 1.02% were the top losers.

Asian markets were trading in green; Shanghai Composite increased 1.19 points or 0.04% to 3,293.83, FTSE Bursa Malaysia KLCI rose 4.12 points or 0.23% to 1,769.25, KOSPI Index added 4.67 points or 0.19% to 2,427.63, Jakarta Composite was up by 11.1 points or 0.19% to 5,816.30, Taiwan Weighted inched up 81.98 points or 0.79% to 10,519.27, Nikkei 225 increased 94.25 points or 0.47% to 20,080.04 and Hang Seng surged 179.62 points or 0.65% to 27,719.85.