Motherson Sumi Systems shares extends losses for the third consecutive day on Wednesday as the scrip declined as much as 5.5 per cent in the early trade on Wednesday. (Reuters)

Motherson Sumi Systems shares extends losses for the third consecutive day on Wednesday as the scrip declined as much as 5.5 per cent in the early trade on Wednesday. The company, which supplies parts such as mirrors, bumpers, dash board and door trims to various auto companies of the Volkswagen Group, has seen its shares tank in the wake of emissions scandal in the US. The share price of Motherson Sumi plummeted around 15 per cent in the past two days.

At 10.03 am, Motherson shares on BSE were trading 3.22 per cent down at Rs 234.10. It opened at Rs 230.30 and had touched a high and low of Rs 241.95 and Rs 228.50, respectively, in trade so far.

On NSE, the scrip was trading 3.47 per cent down at Rs 233.55 at the same time.

Motherson Sumi Systems on Tuesday said its supplies to Volkswagen (VW) will not be affected even as the German auto major faces fine in the US. “The reaction is over exaggeration,” Motherson Sumi Systems CFO G N Gauba said.

Stressing that the company will not be affected by the issue, he said: “The emission matter is related to engines and we do not supply any engine parts to VW. Moreover, it is not like a recall due to a part defect.”

He further said Motherson’s exposure to the VW brand is only 12 per cent of its net sales, which stood at Rs 34,490.31 crore in the year ended March 31.

Last Friday, the US Environmental Protection Agency (EPA) accused VW of installing illegal software to cheat emission tests in diesel cars.

(With inputs from PTI)

Sensex and Nifty opened in red on Wednesday following weak global cues. Sensex opened 125.31 points down at 25526.53.(Reuters)

10.29 am: Sensex was down 94 points at 25,558.21. Brokers said besides persistent capital outflows by
foreign funds, a weak trend in Asia following an overnight heavy sell-off at US markets and a plunge in Chinese factory activity stoked fresh fears about the health of the world’s second-largest economy and the global outlook, which soured mood here. Caution ahead of Thursday’s September expiry in the derivatives segment also weighed. Nifty was down 39.30 points at 7,772.

10.15 am: Continuing its slide for the third straight day, the rupee depreciated by another 19 paise to
trade at 66.07 against the dollar in early trade on Wednesday on foreign funds outflows amid a lower opening in the domestic equity market.

9.45 am: Visa Steel shares surged as much as 20 per cent in the early trade on Wednesday after lenders of Visa Steel decided to convert a large portion of their loans into equity using the Reserve Bank of India’s (RBI) strategic debt restructuring (SDR) scheme. Visa Steel shares were trading 15 per cent up at Rs 16.60 apiece. Sensex was down 113 points at 25,538.

9.38 am: Metal stocks declined in the early trade on Wednesday after a survey has found that China’s manufacturing slump has deepened as activity in the vital sector has fallen to its lowest level in 6 – 1/2 years. The Caixin preliminary survey of factory purchasing managers released Wednesday fell in September to 47.0, its lowest level in 78 months. The BSE Metal index plunged 1.41 per cent at 6,878.08.

9.30 am: In the 50-share index, BPCL, Cairn India, Power Grid, TCS and Hero MotoCorp gained between 0.35 per cent and 0.80 per cent. On the other hand, Bosch, NMDC, Tata Steel, Tata Motors and HCL Technologies declined between 1.70 per cent and 3.60 per cent. CNX Nifty was down 60.60 points, or 0.78 per cent, at 7,751.40. The BSE benchmark index Sensex was down 161.51 points, or 0.63 per cent, at 25,487.02.

9.17 am: Sensex was down 223 points at 25,429. Nifty was down 84.75 points at 7727.25. Continuing to fall for the third straight day, shares of auto component maker Motherson Sumi Systems declined naerly 4 per cent amid concerns related to Volkswagen, which is facing a fine of up to $18 billion in
the US for using device to falsify emissions data. The scrip was trading 3.80 per cent down at Rs 232.70 in the early trade.

Domestic equity markets opened in red on Wednesday following weak global cues. Sensex opened 125.31 points down at 25526.53.

SKS Microfinance informed BSE before market hours that it has decided to reduce the interest rate charged to its borrowers from 22 per cent to 20.75 per cent on income generating loans to be extended wef October 1, 2015. SKS Microfinance shares were trading 0.56 per cent down at Rs 390.20 in the opening trade.

Stock markets tumbled over 2 per cent on Tuesday. Jayant Manglik, president, retail distribution, Religare Securities, said, “Sentiments were under pressure on Tuesday after Asian Development Bank (ADB) stated that weaker growth in China this year is expected to cause a slowdown in the rest of Asia. Selling pressure intensified further with decline in the European and US markets in the second half, which triggered steep decline across the board.”

Global Markets

New York: US stocks dropped on Tuesday as a selloff in commodities dragged down materials companies while Volkswagen suppliers’ shares dropped following the German carmaker’s emissions scandal.

London: Britain’s top share index retreated on Tuesday as weaker oil and metals prices weighed on commodity stocks, while motor insurer and repair group AA slumped after posting lower earnings.

Tokyo: Japanese markets are shut through Wednesday.

Hong Kong: The Hang Seng Index down 2 percent.

** India’s NSE index falls more than 2 pct, marking it biggest single day fall in more than two weeks and erasing more half the gains seen since the Sept 7 lows

** FIIs net sellers in the previous session if adjusted for a block deal in L&T Finance in which Citi bought – Reuters Calculations

** FIIs are headed towards their fourth month of sales in Indian stocks in five NSDL data shows

** Fund managers, institutional dealers cite redemption pressures in marquee names such as HDFC, TCS, Infosys and ICICI Bank

** India still trades at heavy valuation premium to rivals as relatively healthier macro picture pushes GEM/Asia-focused funds into country’s equities

** Continued bleeding in EM funds, where India still remains the biggest “overweight” position by far, combined with a weakening rupee and rich valuations relative to earnings growth has meant offshore investors are on the retreat

** EM equity funds suffered an 11th straight week of outflows in the week ending Sept 9, with a total of $38 bln leaving over that period, brokers said, citing EPFR data

** Also, DII war chest isn’t enough to counter FII selldown

** Macquarie, Barclays, Deutsche Bank and Ambit had slashed India’s targets earlier citing delay in earnings recovery

Capital market regulator, Securities and Exchange Board of India (Sebi), has levied a fine of Rs 7,269.5 crore on Pearl Agrotech Corp (PACL) and its four directors  for running an illicit money pooling scheme worth Rs 50,000 crore.

The penalty follows a Securities Appellate Tribunal (SAT) order last month that upheld Sebi’s investigations and told PACL to close operation within three months from the date of the SAT order.

On Tuesday, Sebi’s adjudicating officer Amit Pradhan said the penalty is three times the profit accrued and commensurate with the default committed by the company and its directors. “It will give a strong message to securities market at large that such types of violations will not be viewed lightly,” Pradhan stated in a 42-page order, effective immediately.

In August 2014, Sebi found PACL guilty of violating collective investment scheme (CIS) norms by raising money without registering with the regulator.

Sebi had directed the company to refund close to Rs 30,000 crore raised from some 58.5 million customers through the CIS.

The money was collected by the Nirmal Singh Bhangoo-managed group through its two companies — Pearls Agrotech Corporation (PACL) and Pearls Golden Forest (PGFL), in Ponzi schemes under the garb of sale and development of agricultural land.

The amount concerned is twice that collected by the Sahara Group, which is said to have mobilised Rs 24,000 crore.

In April this year, the Supreme Court ordered Pearl Group companies to liquidate assets and repay investors spread across Punjab, Haryana, Rajasthan, and Delhi. The apex court ordered the company to liquidate property, cash deposits and other assets to repay investors.