SKINDIA INDIAN GDR MONITOR
Volume VI No 10	Mar 05-Mar 11, 1999	12-Mar-99

After a capital market friendly budget, there was hectic buying in the stocks by the foreign as well as domestic funds. As a result of which the markets entered the over bought zone, thus the technical correction due, happened this week in both the GDR and the domestic markets. Due to the correction the Skindia GDR Index fell a marginal 2.98 points by the end of week, while the BSE Sensex 71.55 points. As overall the sentiment remains steady and the outlook for India remains positive, the average spread of the 38 most actively traded GDRs reduced from 9.14% on Mar 4, 1999 to 8.71% on Mar 11, 1999 and the average GDR premium over the underlying shares of 61 GDRs moved up from 4.87% on Mar 4, 1999 to 5.32% on Mar 11, 1999. During the week, 61 GDRs on an average lost 1.62% and the shares 2.04%. In GDRs, power sector as the major gainer with a rise of 7.05% followed by pharma and cement with 5.85% and 4.88%. The major losers were steel, aluminium and textile sectors losing 7.22%, 6.79% and 5.50% respectively. In shares, the top gainers were from power (5.71%), pharma (4.76%) and auto (0.83%), top losers were aluminium (7.62%), steel (5.92%) and fertiliser (4.90%). After an unsuccessful attempt by BPL Cellular Holdings, in Dec 1996, this week on Mar 11, Infosys Tech. made a successful issue of 2.07million ADRs at an offer price of US$34.00, collecting US$ 70.38 million. The stock listed on the NASDAQ, opened at $37.0375, touched a high of $50.00 before closing at $47.00, a premium of 38.24% over the issue price and 24.07% over the BSE closing price of Rs 3,201.00 (1 domestic share equals two ADRs). Such a good response to the Infosys ADR lead to a feeling of enthusiasm in the domestic bourses and most of the Information technology stocks were quoting at high premiums to their previous closes. Another significant happening of the week was the passage of Patents Bill in the Lower House of the Parliament, which initially lead to euphoria towards the pharma stock and on the day of passage (Mar 10, 1999) most of the scrips in this sector touched the circuit. But the same effect was not witnessed in the GDR markets. There, Only Ranbaxy appreciated 4.93% to $13.30, while all the other stocks Core Health, Dr. Reddy's and Wockhardt remained unchanged. This was probably because the news of the passage of the bill had been discounted in December 1998, when during the winter session of Parliament the bill was almost certain to go through

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