NSE WEEKLY NEWS UPDATE

✍ JP Associates Crashes 33% in 4 Days, Loses Rs. 3,300 Crore M-Cap
Shares in Jaiprakash Associates crashed to double-digit losses for a second straight session on Friday. Shares in the engineering and construction firm fell as much as 14 per cent on top of the 17.6 per cent plunge yesterday. Over the last four sessions, Jaiprakash Associates has fallen 33 per cent and lost over Rs. 3,300 crore in market capitalization.

Reasons for the selloff:
✍ Promoters have sold shares in open market: Amid speculation that promoters are reducing their stakes, Jaiprakash Associates yesterday clarified that one of its promoters (Jaypee Infra Ventures) sold 3.53 crore shares between September 1 to September 3. Its stake has now come down from 29.75 per cent to 28.30 per cent. The promoters as of June-2014 had no pledged shares and own 45 per cent stake in Jaiprakash Associates currently rumors in the market that Jaiprakash Associates, as a Group, has not been able to service its debt.
✍ It's known fact that Jaiprakash Associates is struggling under huge debt. According to Thomson Reuters data, the company has a net debt of Rs. 63,111 crore and a debt-to-equity ratio of nearly 6 times. To deleverage, the company has been trying to dispose some of its assets.

✍ DLF shares tumble as court cancels land auction
In yet another legal blow to realty major DLF, the high court of Punjab and Haryana canceled an earlier auction bagged by the company in August 2009. DLF shares tumbled 6 per cent to Rs. 171 on news that 350.7 acres of prime land in Gurgaon on the Golf Course Road, acquired for Rs. 1,703 crore, will be re-auctioned. However, the judgment does not bring relief to the villagers who challenged the government’s decision of auctioning the land for commercial activities. The land was acquired from the local farmers for developing a recreational project for public purpose. The land is likely to be re-auctioned, within a month, as the court ruled that the auction was illegal on technical grounds. The technical issue is that the other bidders for the land were disqualified due to lack of expertise in developing golf course, enabling DLF to win the auction. DLF has been facing a slew of legal and regulatory hassles. The company was in the news last week when the Supreme Court directed DLF to deposit Rs. 630 crore during the duration of the trial. DLF had filed an appeal against a May 2014 order from the Competition Appellate Tribunal (COMPAT) to pay Rs. 630 crore as penalty for unfair trade practice. In another similar case filed by buyers, the Competition Commission of India had imposed a fine of Rs. 2.4 crore in March 2014.

✍ J&K Bank announces 10:1 stock split
The J&K Bank Board of Directors have recommended a stock split of 10:1. The private sector lender’s Board on Thursday announced the proposal to pave the way for more liquidity in the lender’s shares. “The Board of Directors of J&K Bank Ltd has opted for a 10:1 stock split (10 shares of ₹1 each for every one share of ₹10 held) at its meeting held on June 12,” the bank said in a statement. The decision of the board would be subject to approval of the shareholders at the ensuing Annual General Meeting of the bank scheduled to be held on August 2. At present, the Government of J&K (53.17 per cent), along with foreign institutional investors (28.77 per cent), hold 81.94 per cent of the total equity shares of the bank, while the remaining 18.06 per cent is held by other investors.

✍ Cipla launches combination inhalers in Germany and Sweeden; stocks touch all time high, may trigger re-rating
Cipla's shares have vaulted to a record high after the launch of first of its combination inhalers in Germany and Sweden that marked its entry into Europe. Analysts say the launch will lead to a gradual rerating of the stock of the drug maker which has been under performing its peers. The maiden launch increases the possibility and visibility of subsequent launches of the company's inhalers in other countries over the next 12-18 months. CiplaBSE -0.52 % has launched the generic version of combination inhaler Advair MDI in the two European countries.

✍ Maruti to pay royalty to Suzuki in rupees for future models
Maruti Suzuki India Ltd , the nation's top carmaker, said on Thursday it would make royalty payments due to parent Suzuki Motor Corp for all future models in rupees to limit risks from foreign exchange fluctuations. Maruti, over 56 per cent-owned by Suzuki, currently pays royalties in yen for use of technical knowhow and its Japanese parent brand name. The company paid Rs 24.86 billion ($412 million), or nearly 6 per cent of its net sales, in royalties for the year to March, according to its annual report for the year.

✍ ECB lenders can extend loans in Re
Relaxing norms for external borrowings, RBI on Wednesday allowed ECB lenders to extend loans in Indian rupees to domestic businesses. "With a view to providing greater flexibility for structuring of external commercial borrowings (ECB) arrangements, it has been decided that recognized non-resident ECB lenders may extend loans in Indian rupees," the RBI said in a notification.

✍ BSNL and MTNL to be merged by July 2015
The telecom department (DoT) has for the first time set a cutoff date—July 31, 2015—for concluding the much discussed merger of struggling state-run telecom companies, Bharat Sanchar Nigam Ltd and Mahanagar Telephone Nigam Ltd. In a presentation to Prime Minister Narendra Modi, seen by ET, DoT said it expects to "secure Cabinet approval for the proposed BSNL-MTNL merger by June 30 next year". Towards this, it plans to wrap up merger consultations with the unions of BSNL and MTNLBSE 6.66 % by March 31, 2015, and circulate a draft Cabinet note for inter-ministerial consultations by April 30 next year. MTNL runs telecom services in Delhi and Mumbai while BSNL offers telecom coverage in the rest of India.



✍ India slips to 71st rank in global competitiveness list
Weighed down by challenging economic conditions for most part of the past year, India has slipped to 71st position — the lowest among BRICS countries in an annual global competitiveness list, with Switzerland claiming the top spot. The annual list, released on Wednesday by Geneva-based World Economic Forum (WEF), comes at a time when the new Indian government has completed 100 days in power and has promised further steps to revive its economy and the ease of doing business in the country.

✍ ONGC bats for $6-7/unit gas price
Flagship explorer ONGC has conveyed to the government that it needs a price of $6-7 per unit to make its plan for producing gas from new and ageing fields in the next few years viable. ONGC's quote, in the state-run company's submission to the panel of secretaries on gas prices, is lower than $8-9 per unit projected by the Rangarajan formula approved by the UPA government. This price also fits well within the government's line of thinking — a price of $5.5-6.5 per unit.


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