Jan. 4 (Bloomberg) -- India’s manufacturing output rose the most in seven months in December as exports rebounded and government stimulus stoked domestic demand for consumer goods.
HSBC Holdings Plc and Markit Economics’ Purchasing Managers’ Index stood at 55.6 last month compared with 53 in November, according to a report released today. That was the ninth monthly reading above 50, which indicates a gain in factory production.
Faster economic growth may enable Indian policy makers to start reversing emergency stimulus measures taken last year to prop up growth in Asia’s third-biggest economy. China’s manufacturing expanded at the fastest pace in more than five years in December, a report showed today, as Asian economies recover from the worst global recession since World War II.
“Concerns that growth in India’s manufacturing sector was taking a decisive turn for the worse should be allayed by this impressive release,” said Robert Prior-Wandesforde, senior Asia economist at HSBC Holdings in Singapore. “External demand is also playing an increasingly important role in driving output gains.”
Recent economic data indicate the recovery is gaining traction. Exports rose 18.2 percent in November to $13.2 billion, the first increase in 14 months, and industrial output growth accelerated to 10.3 percent in October.
Economic Stimulus
Prime Minister Manmohan Singh’s government and the central bank injected fiscal and monetary stimulus of more than 12 percent of gross domestic product between September 2008 and April 2009. That helped the economy grow 7.9 percent in the three months to Sept. 30, the fastest pace in more than a year.
India may grow as much as 8 percent in the year ending March 31, Finance Minister Pranab Mukherjee said on Dec. 23.
The prospect of faster economic expansion helped the Sensitive Index of stocks gain 81 percent in 2009, the biggest annual increase in 18 years. The Sensex rose 0.4 percent to 17,531.33 at 10.56 a.m. in Mumbai.
Record-low interest rates and tax cuts are reviving demand for cars made by Maruti Suzuki India Ltd. and Hyundai Motor Co.
“December data pointed to a substantial increase in new business received by Indian manufacturers,” Prior-Wandesforde said. The growth was driven by better economic conditions, business investments and promotional activities. “Demand from both domestic and foreign sources rose since November, although the home market remained the main driver of total new business expansion,” he said in the report.
Monday, January 04, 2010
Reliance Industries Raises $576 Million in Share Sale
Jan. 4 (Bloomberg) -- Reliance Industries Ltd., the Indian company seeking to buy LyondellBasell Industries AF, said it raised 26.8 billion rupees ($576 million) selling shares.
India’s largest company by market value sold 25.9 million shares at an average price of 1,035 rupees apiece, Reliance said in a statement to the Bombay Stock Exchange today. Life Insurance Corp. of India bought 25 million shares, a person familiar with the matter said.
The sale, the second such transaction by Reliance in less than four months, was at a 5 percent discount to the stock’s Dec. 31 closing price. Reliance’s Petroleum Trust unit raised $664 million selling shares to investors on Sept. 17.
“It is difficult to sell such large volumes of shares at market prices so the discount is not unusual,” said Apurva Shah, head of research at Prabhudas Lilladher Pvt. in Mumbai. “With a possible LyondellBasell deal around the corner, Reliance could be raising money for the purchase.”
Shares of Reliance Industries fell 1.4 percent, the most in two weeks, to 1,075.50 rupees in Mumbai trading. The benchmark Sensitive Index gained 0.5 percent. The stock rose 77 percent last year.
Lyondell Chemical Co. filed a plan to reorganize with the U.S. Bankruptcy Court last month as it evaluates an offer from Reliance, pitting the Indian company against lenders in a battle for the bankrupt chemical maker.
Reliance may pay as much as $12 billion for a controlling stake, Victor Shum, a Singapore-based senior principal at energy consultant Purvin & Gertz Inc., said in November when Reliance announced it made a non-binding all-cash bid to acquire LyondellBasell. The Mumbai-company hasn’t made details of its bid public.
Treasury Stock
Reliance created so-called treasury stock in 2002 when it merged with unit Reliance Petroleum Ltd., which constructed its first 660,000 barrel-a-day crude oil refinery at Jamnagar in Gujarat state. The company had 368 million such shares before today’s sale, K.R. Choksey Shares & Securities Pvt. said in a note.
Reliance has $4.65 billion of cash and cash equivalent and $7.9 billion in treasury stock, according to K.R. Choksey.
Life Insurance Corp. is the largest institutional shareholder in Reliance with a 6.07 percent stake as of Sept. 30, according to data compiled by Bloomberg.
Citigroup Inc. and Morgan Stanley managed the stock sale, according to Bloomberg data.
India’s largest company by market value sold 25.9 million shares at an average price of 1,035 rupees apiece, Reliance said in a statement to the Bombay Stock Exchange today. Life Insurance Corp. of India bought 25 million shares, a person familiar with the matter said.
The sale, the second such transaction by Reliance in less than four months, was at a 5 percent discount to the stock’s Dec. 31 closing price. Reliance’s Petroleum Trust unit raised $664 million selling shares to investors on Sept. 17.
“It is difficult to sell such large volumes of shares at market prices so the discount is not unusual,” said Apurva Shah, head of research at Prabhudas Lilladher Pvt. in Mumbai. “With a possible LyondellBasell deal around the corner, Reliance could be raising money for the purchase.”
Shares of Reliance Industries fell 1.4 percent, the most in two weeks, to 1,075.50 rupees in Mumbai trading. The benchmark Sensitive Index gained 0.5 percent. The stock rose 77 percent last year.
Lyondell Chemical Co. filed a plan to reorganize with the U.S. Bankruptcy Court last month as it evaluates an offer from Reliance, pitting the Indian company against lenders in a battle for the bankrupt chemical maker.
Reliance may pay as much as $12 billion for a controlling stake, Victor Shum, a Singapore-based senior principal at energy consultant Purvin & Gertz Inc., said in November when Reliance announced it made a non-binding all-cash bid to acquire LyondellBasell. The Mumbai-company hasn’t made details of its bid public.
Treasury Stock
Reliance created so-called treasury stock in 2002 when it merged with unit Reliance Petroleum Ltd., which constructed its first 660,000 barrel-a-day crude oil refinery at Jamnagar in Gujarat state. The company had 368 million such shares before today’s sale, K.R. Choksey Shares & Securities Pvt. said in a note.
Reliance has $4.65 billion of cash and cash equivalent and $7.9 billion in treasury stock, according to K.R. Choksey.
Life Insurance Corp. is the largest institutional shareholder in Reliance with a 6.07 percent stake as of Sept. 30, according to data compiled by Bloomberg.
Citigroup Inc. and Morgan Stanley managed the stock sale, according to Bloomberg data.
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