Indian Benchmark indices, BSE Sensex and NSE Nifty, opened on a positive note today after MSCI’s China inclusion failed to deter the markets yesterday, as banking stocks gained on the back of SEBI’s relaxation to banks from its strict share pricing rules in order to ease takeover process of stressed assets. BSE Sensex opened 67.89 points or 0.22% higher at 31,3351.53 points, while NSE Nifty, the broader gauge, opened flat at 9,642.65 points. At 9:28 am, BSE Sensex was trading 131.75 points or 0.42% higher at 31,415.39 points while the NSE Nifty was up 36.90 points or 0.38% at 9,670.50 points.
The Securities and Exchange Board of India (SEBI) Wednesday said that it would ease the takeover process for banks under the recently-introduced bankruptcy code from its strict share pricing rules, adding that such transactions will be governed only by RBI regulations.
“Share price during stake sale under NCLT will be not bound by SEBI rules,” SEBI chairman Ajay Tyagi said after the regulator’s board meeting.
Rajnish Kumar, Managing Director SBI said that the decision was put forth initially by bankers to cut losses and that it will be applicable when any debt has to be converted to equity for sale. As per current rules, equity pricing formula for open offers is the average of the six-month share price high and low.
“Whatever is the book value of shares, bankers won’t be required to pay more than that,” Kumar said.
US stocks closed mostly lower on Wednesday as oil prices failed to rebound from a sharp fall during the previous session. The Dow Jones Industrial Average index dropped 57.11 points, or 0.27 percent, to settle the day at 21,410.03. The S&P500 index inched 1.42 points, or 0.06 percent, lower at 2,435.61. The Nasdaq Composite index lost 45.92 points, or 0.74 percent, to 6,233.95.
Asian markets were trading mixed in early morning trade.
Back home, the IPO of Central Depository Services Ltd (CDSL) received tremendous response from all types of investors as the Rs 524-crore issue was oversubscribed 170.11 times on the final day.
Oil prices ended more than 2 percent down on Wednesday after hitting a 10-month low. US crude futures settled at $42.53, down 98 cents or 2.3 percent, after touching a low of $42.13, the lowest intraday level since August 2016. Brent crude futures slipped by $1.20, or 2.61 per cent, to $44.82 a barrel.
The Indian Rupee opened flat today at 64.53 against its yesterday’s close of 64.52. The domestic currency had closed 3 paise lower on Wednesday.