Sensex soars 142 pts in opening trade

STAFF WRITER 9:34 HRS IST

Mumbai, Oct 25 (PTI) Led by a rally in metal and oil and gas stocks, the Bombay Stock Exchange benchmark Sensex shot up by nearly 142 points in the opening trade today on strong capital inflows by foreign funds and firm Asian markets.

The 30-share index of the BSE, which had lost 94.72 points in the previous session, rose by 141.90 points, or 0.59 per cent, to 20,307.76 in the morning trade with all the sectoral indices trading in positive zone with gains up to 1.04 per cent.

Similarly, the wide-based National Stock Exchange regained 6,100 level by rising 42.10 points, or 0.68 per cent, to 6,108.15.

Analysts said that increased inflows of overseas funds bolstered by strong quarterly earnings by corporates and a firm trend on the other Asian bourses led to the rise.

In the Asian region, the Hong Kong's Hang Seng index was up by 0.

2 lakh in India die of malaria annually: Lancet

Malaria kills nearly 2 lakh people in India every year, including 80,000 children below the age of 15 years, according to a new study published in reputed medical journal The Lancet.

The report contradicts the findings of the World Health Organisation (WHO) which had put the number of deaths due to malaria in India at 15,000.

The Lancet report says that 90 per cent of the deaths were recorded in rural areas, of which 86 per cent occurred at home without any medical attention. The study, which began in 2002, covered 6,671 areas, each with about 200 households.

The research, led by teams from the office of the Registrar General of India, Centre for Global Health Research at St Michael’s Hospital and University of Toronto, Canada, found that Orissa reported the highest number of deaths — 50,000. The other “high-malaria” states are Chhattisgarh, Jharkhand and Assam.

“In the absence of other diseases, on current death rates, a newborn in Orissa has 12 per cent chance of dying from malaria before the age of 70 years, as against 2 per cent for the average Indian baby,” Prof Prabhat Jha, co-lead author of the study, told The Indian Express.

“The WHO relies on properly diagnosed malaria patients for the estimates, which can be misleading,” said Jha.

But WHO’s India representative, Dr Nate Menabde, said its methodology is “universal”. “The method of verbal autopsy is suitable only for diseases with distinctive symptoms and not for malaria. Malaria has symptoms common with many other diseases and cannot be correctly identified by the local population. The use of verbal autopsy for malaria may result in many false positives.

In this method, deaths due to fever from any cause are likely to be misinterpreted as malaria in areas with high incidence. In areas with low malaria incidence, the symptoms are difficult to distinguish and would result in overestimates of malaria deaths,” said a statement issued by Menabde.

“The limitations of verbal autopsy, and the implausibly high case incidence rates implied by the malaria mortality estimates, indicate that the findings of the study cannot be accepted without further validation,” it added.

But Jha countered that the “WHO itself uses verbal autopsy for estimating malaria. So why aren’t they accepting it this time?”

Source:http://www.indianexpress.com/news/2-lakh-in-India-die-of-malaria-annually--Lancet/700930

Coal India IPO subscribed 15.28 times

The initial public offer (IPO) of India's largest coal producing company Coal India (CIL) has seen huge response from investors and has received bids for more than USD 53 billion worth of equity shares as against issue size of USD 3.5 billion on last day.

The issue has been subscribed more than 15.28 times, including major contribution from qualified institutional buyers (QIBs) followed by non-institutional investors (NIIs) and retail investors.

Coal India IPO subscribed 15.28 times

For the reserved portion of QIBs (which closed on Wednesday and was subscribed 24.7 times), foreign institutional investors put in bids for USD 27.5 billion worth of equity shares followed by domestic financial institutions and mutual funds with USD 10 billion and USD 1.4 billion, respectively. (USD 1 = Rs 44)

The reserved portion of non-institutional investors was subscribed 25.4 times and retail 2.31 times while employees' portion was subscribed just 0.1 times.

Institutional investors have gone all out for Coal India with the IPO getting highest-ever demand received by an Indian issue. QIB generated demand for CIL was at Rs 1,73,398 crore with 100% margin while Rs 1,88,923 crore with 10% margin in case of Reliance Power IPO, which launched in 2008. In case of Reliance Power, QIBs' portion had subscribed 30.68 times.

A price band of the issue is at Rs 225-245 a share. Prasad Baji of Edelweiss Securities said that the market needs to treat CIL as an utility play. According to him, CIL’s fair value is at Rs 316 per share as coal prices are unlikely to come down in India. "Our assessment of fair value is Rs 316 based on a DCF valuation. Even on EV/EBITDA basis we are getting at Rs 300 price so there is some amount left on the table in this issue," he said.

However, Paresh Jain of Angel Broking differs. According to Jain, CIL’s fair value is at Rs 294 per share, which is based on the DCF valuation methodology. "We feel that the downside from the issue price is capped. There are no anchor investors in this particular issue. Most of the long only issue funds that need a good chunk of the stock would have to come and purchase it from the open market. That would give a boost to your stock price. I would advice investors to hold on to the stock because clearly our country is deficit in coal. Going forward as you see the washeries coming in, you will see earnings growth much faster 2013 onwards," he reasoned.

It would be the largest ever IPO by an Indian company. All issue proceeds will be received by the selling shareholder (GoI), which stake will be 89.99% post the issue. The offer shall constitute 10% of the post offer paid-up equity share capital of company.

However, Baji says, 26% mining profit share is a key risk, not just for Coal India but for the entire mining space. "In case of Coal India, there are certain mitigating factors. They spend 4% of their revenues on social activity. There is some case here that the management has been speaking to set it off against any kind of distribution of profits." he explained.

Book running lead mangers to the issue are Citigroup Global Markets India Private Limited, Deutsche Equities (India) Private Limited, DSP Merrill Lynch Limited, ENAM Securities Private Limited, Kotak Mahindra Capital Company Limited and Morgan Stanley India Company Private Limited.

US official hints at lifting nuclear curbs on India

In the first official pronouncement, the US on Thursday said it wants “export control policies” to reflect India “as a partner, not a target”, indicating the lifting of curbs during President Barack Obama’s visit next month. HT had first reported that a US announcement of the end of advanced nuclear technology sanctions against India was expected (Hi-tech N-sanctions against India to go, October 21).

“...Working together to adapt and reform the export control policies to reflect the realities of the 21st century partnership, so that India is treated as a partner and not a target,” US under secretary of state William Burns said after his meeting with external affairs minister S.M. Krishna and foreign secretary Nirupama Rao.

Burns and US assistant secretary for South Asia Robert Blake are meeting Indian officials to firm up the deliverables during Obama’s visit.

Burns said Obama has a “rich agenda” during his visit that encompasses a range of issues, from agriculture to expansion of defence cooperation to counter-terrorism cooperation. The US is also committed to working with India to realise the full potential of the historic civil nuclear deal, he added.

“In all these areas, there is extraordinary promise and opportunity and we are determined to continue working together and... I believe we are making good progress,” he said.

Terming Obama’s visit a “historic moment” in India-US ties, Burns said America had deep strategic interest in India’s emergence as global power.

Burns will also meet former national security adviser M.K. Narayanan, who had an active role in the civil nuclear deal, before he leaves on Friday.

HT