State lender Corporation Bank today approved issuance of over 15.66 crore shares on preferential basis to government valued at about Rs 857 crore. (Express Photo)

State lender Corporation Bank today approved issuance of over 15.66 crore shares on preferential basis to government valued at about Rs 857 crore.

At the Extraordinary General Meeting (EGM) held in Mangaluru today, the bank also approved to issue over 2.8 crore equity shares to LIC worth over Rs 142.99 crore.

In a filing on BSE, Corporation Bank said the meeting of the shareholders resolved and approved “to issue 15,66,15,497 equity shares…at an issue price of Rs 54.72 per share, to the government i.e. the promoter.”

“…decision of government to infuse funds up to Rs 856,99,99,995.84 into the capital of the Bank, by way of issue and allotment of 15,66,15,497 equity shares of the bank…on preferential basis,” said the filing.

Corporation Bank also said it will issue 2,81,60,693 equity shares of the bank at an issue price (which is at premium) of Rs 50.78 per share to the Life Insurance Corporation of India (LIC), a shareholder.

In August, government had announced capital infusion of Rs 20,088 crore in 13 public sector banks, including in SBI, PNB, IDBI, Bank of Baroda, Canara Bank.

Shares of Corporation Bank today closed at Rs 44.15 apiece on BSE, down 0.11 per cent from previous close.

Stocks in focus today: Crompton Greaves has bagged a 17 million euro (Rs 125 crore) order from Spanish utility Gas Natural Fenosa (GNF) for supplying ZIV single and three phased smart meters.(Photo: PTI)

The BSE Sensex and NSE Nifty opened on a weak note on Tuesday after Asian shares fell to three-week lows on China worries. At 9.20 am, Sensex was down 263.99 points at 25,352.85. Similarly, Nifty was down 81.50 points at 7,714.20 during the same time.

Stocks that are likely to be in focus

Rate sensitive stocks will be in focus ahead of the Reserve Bank of India’s (RBI) monetary policy review, which is scheduled around at 11 am.

Crompton Greaves: The Avantha Group company Crompton Greaves has bagged a 17 million euro (Rs 125 crore) order from Spanish utility Gas Natural Fenosa (GNF) for supplying ZIV single and three phased smart meters.

Jaiprakash Power Ventures: The company on Monday said that it has paid $75 million to bondholders on sale of securities of its arm Himachal Baspa Power Company Limited (HBPCL) to JSW Energy.

Maruti Suzuki: After a wage hike for its permanent workers last week, Maruti Suzuki is now going to do the same for its temporary and contractual employees, Financial Express reports. Though some temporary workers at the company’s Manesar plant had staged a protest on Saturday after the wage revision for permanent workers demanding they too be given a hike, sources in the company said that a revision for the former is also in the works so the matter has been resolved.

Lanco Infratech: The company said it may sell power projects having capacity of 3,000 MW from 2018 onwards and expects to get Rs 25,000 crore, which would help pare debt and also infuse fresh capital into the group.

Larsen & Toubro (L&T): The engineering major said its arm L&T Construction has bagged orders worth Rs 1,509 crore so far this month.

The BSE Sensex and NSE Nifty are likely to open in deep red on Tuesday tracking SGX Nifty and weak global cues.  (Photo: Reuters)

The BSE Sensex and NSE Nifty are likely to open in deep red on Tuesday tracking SGX Nifty and weak global cues. Interest sensitive stocks are likely to be in focus ahead of the Reserve Bank of India’s (RBI) monetary policy review, which is scheduled around at 11 am. The RBI had kept its benchmark lending rate – the repo rate unchanged at 7.25 per cent in its monetary policy review on August 4.

At 8.22 am (IST), SGX Nifty was down 1.50 per cent, or 115.50 points, at 7,717.50.

Achin Goel, head, wealth management and financial planning, Bonanza Portfolio, said, “Outcome of RBI’s monetary policy meet on Tuesday will decide the trend of the markets in the near term.”

Asian shares skidded to three-week lows and the dollar sagged on Tuesday, after weak Chinese data rekindled worries about its fragile economy and led to sharp losses on Wall Street.

Hang Seng, Nikkei and Shanghai were down 3.48 per cent, 2.77 per cent and 1.35 per cent at 20,448, 17,156 and 3,057, respectively.

Chinese industrial companies’ profits fell at their fastest rate in four years, official data showed on Monday, sparking fresh fears about the strength of that country’s economy ahead the final reading of China’s Caixin Purchasing Managers’ Index on Thursday.

On Wall Street on Monday, all major indices closed in red. The S&P 500 index hit a one-month low on bullish US consumer spending data in August as it raised concerns the Federal Reserve could hike rates at a time of slackening global growth.

Back home, Sensex closed 246.66 points down at 25,616.84 on Monday while Nifty closed 72.80 points down at 7,795.70.

Vinod Nair, head, fundamental research, Geojit BNP Paribas Financial Services, said, “We are in a wait and watch scenario ahead the RBI policy meet on Tuesday. We believe that the market has already considered a rate cut of 25 basis points, hence the commentary will be more important. Given the volatility in the global currency and the likelihood of a US rate hike by Dec-15, the commentary is likely to be hawkish and may not be taken positively by the market.”

(With inputs from agencies)

We maintain our negative view on Motherson Sumi Systems (MSS) as we believe consensus estimates are too optimistic, particularly on margin improvement in the SMP business.

We expect new SMP plants to operate at lower than current margins of the company as capacity utilisation rates are likely to remain low. Further, the standalone business is also facing incremental competitive pressure from Minda-Furukawa, which could impact profitability. While we retain our earnings estimates for now, we cut our valuation multiples to factor in the uncertainty around revenue growth from Volkswagen.

We see limited impact in the near term on Motherson Sumi from probable fines on Volkswagen for violating emission norms in the US of its diesel vehicles. We believe Motherson Sumi will get impacted if VW diesel vehicle sales get impacted in Europe due to this issue which we believe is difficult to assess at this juncture. We maintain our sell rating on the stock as we are concerned on slowing revenue growth in the standalone business and slower than expected improvement in SMRPBV Ebitda margins

We believe that normally such investigations last for several months and may result in significant financial outgo for the OEMs. There could be some impact on VW’s sales volumes at least in the near term.

Union finance minister Arun Jaitley with Sebi chairman UK Sinha in Mumbai on Monday.

The Securities and Exchange Board of India (Sebi), which on Monday officially assumed a wider role of regulating commodities futures market, plans to liberalise commodities trading by allowing access to foreign portfolio investors (FPIs) and banks, albeit in a gradual manner.

The unified regulator also aims to allow trading in commodities index futures and options to help the industry with a wide variety of products and better price convergence, Sebi chairman UK Sinha said at an event marking the merger of the two regulators.

“There is no reason why options and index futures trading should not be allowed in commodity derivatives markets… why banks and foreign portfolio investors that are not allowed today should not be allowed. These development measures will happen in a few months. Our immediate focus is to ensure stability and credibility in commodities markets and also to ensure that there are no disruptions in the way of functioning of commodity exchanges,” Sinha said on the sidelines of the event attended by attended by finance minister Arun Jaitley and economic affairs secretary Shaktikanta Das.

Commodity futures in India have been a politically sensitive issue. Despite a report by a government panel that showed no link between futures trading and wider swings in spot prices of food items, policy makers briefly suspended trading in soybean oil, potato, rubber and chickpea futures in 2008 after the Left parties blamed speculation by traders for rising inflation.

Das acknowledged several regulatory challenges within the commodities markets in India, especially agricultural commodities where any fluctuation in retail prices causes a lot of cry in various sections of the society.

“While the derivatives market will be controlled by Sebi, the agricultural commodity market are controlled by state governments through various enactments. This poses another challenge for Sebi and I am sure Sebi will be able to deal with this and ensure smooth and seamless transition,” Das said, adding that Sebi must also ensure steps to deepen the markets in a manner that provides price stability and that benefits also reach the farmers.

In the first ever merger of two regulators, over 60-year-old commodities regulatory body Forward Markets Commission (FMC) on Monday merged with the capital markets watchdog Sebi with FM Jaitley ringing the customary stock market bell to formalise the amalgamation. The high-profile NSEL scam that rocked the market in July 2013 and the subsequent regulatory and government interventions in the case led to the government announcing FMC’s merger with Sebi. Sebi gets a time-frame of up to one year to adjust to the new regulations as they would have to follow the same norms that are applicable to their peers in the equity segment, while market participants will get up to three years to conform to stricter regulations mandated for securities trading.

Sebi will also have a new mechanism for new entities who want to do business in both securities and commodity markets, and also focus to ensure high quality physical delivery for the combined regulatory authority. Sebi’s whole-time member Rajeev Kumar Agarwal would oversee the commodities market regulation in the merged entity under the overall guidance of the Sebi Chairman. The regulator will take stock of the NSEL matter subsequently.

“Sebi has now matured over the last 25-27 years as an institution and it has become an extremely fair, independent market regulator, it has got the pulse of the market, it has got the pulse of the trade in control. Day-to-day challenges of situations as institutions mature — they get to deal with them. So, I have full confidence that Sebi now as an independent regulator of high credibility will fit into this job quite well,” Jaitley said when asked about Sebi’s ability in dealing with NSEL-like scams.

Das, meanwhile, said a new scheme would be unveiled soon for floating rupee bonds abroad while a new framework is being readied to make it easier for foreign companies to open project offices here.

What lies ahead
* Sebi gets a time-frame of up to one year to adjust to the new regulations as it will have to follow the same norms that are applicable to its peers in the equity segment, while market participants will get up to three years to conform to stricter regulations mandated for securities trading
* Sebi will also have a new mechanism for new entities who want to do business in both securities and commodity markets, and also focus to ensure high quality physical delivery for the combined regulatory authority
* Sebi’s whole-time member Rajeev Kumar Agarwal will oversee the commodities market regulation in the merged entity under the overall guidance of the Sebi chairman
* The regulator will take stock of the NSEL matter subsequently