SKINDIA INDIAN GDR MONITOR
Volume VI No 12	Mar 19-Mar 25, 1999	26-Mar-99

High badla rates bring the capital markets down The week started on a positive note on the back of funds' purchases saw the week the markets take a downturn as big operators began to square up positions before the public holiday on Mar 25. The suspension of the BSE president Mr. J. C. Parekh by The Securities and Exchange Board of India and high badla rates further pushed the markets down. The high badla rates were not on the account of demand but due to the paucity of funds as the money was being paid towards the advance taxes,and is not available for badla financing. Expecting that the badla rates will still be higher the operators did not wish to keep their long positions open, pushing the markets down further, as a result the Skindia GDR Index ended the week with a loss of 34.24 points and while the BSE Sensex managed to end the week with a marginal gain of 9.98 points. During the week the premiums of the 63 depository receipts on an average fell down to 0.64% on March 25 from 1.16% on March 18 and the spreads between the bid and ask of the 39 most actively traded Indian DRs widened to 19.99% on March 25 from 9.40% on March 18. By the end of the week as the domestic and foreign institutions refrained from any fresh buying the 63 DRs on an average lost 5.24%, the shares gained marginally 0.27% during the week, as the Bombay Stock Exchange was closed on Mar 25 and thus the institutions were unable to close their positions force the markets downwards. In the industry wise break up the DRs of Textile sector were the top gainers appreciating 14.42% followed by Aluminium and fertilisers with 13.11% and 8.92%. Fertiliser and textile sectors were the top gainers in the shares as well with a rise of 17.92% and 13.02%. The other top gainer in the shares was cement with a rise of 11.19%. In GDRs, the pharma and IT sectors which have been gaining consistently since the beginning of 1999 were among the top losers this week. The pharma lost 2.05% and IT lost 1.01%. The loss in the It sector got limited to 1.01% as Pentafour Software did not show any movement this week while, Infosys Tech has lost 2.02%. In shares, IT was the top loser with a loss of 12.28%, Infosys falling 9.35% and Pentafour 15.22%, in the week. The steel and hotel sectors were the other losers depreciating 6.81% and 0.77%.

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