The Hindu Business Line : e-choupal may add value to ITC

THE e-choupal initiative for transaction of agriculture products for farmers undertaken by cigarette major ITC is all set to add to the topline and bottomline of the company.

Talks are this would be the new growth area for the company in the next few years as the company's FMCG business has become competitive and the cigarette business is also not showing good growth. Farmers favour e-choupal as through this medium they get better price for their products.

On these expectations, several market players are accumulating the shares of the company. Select buying in the counter was also seen on Tuesday. The stock price of ITC was down 2.38 per cent at Rs 1054.25 on the BSE with volume of 2.08 lakh shares, and, on the NSE, it closed at Rs 1057.25, down 2.17 per cent with the volume of 4.52 lakh shares.

Heavy selling in positions

OTHER than the outcome of the exit polls after the second phase of Lok Sabha elections, derivatives positions were another factor for the fall in the stock market on Tuesday. If the market talk is to be believed several market players have sold off their positions in the derivatives markets.

Dealers said contracts valued at around Rs 500 crore -Rs 600 crore would have been sold in the derivatives market on Tuesday that led to sharp fall in Nifty and Sensex indices. Most of these were April contracts expiring on Thursday. Major selling by the market players was in derivatives contracts of several banks. Some of the big traders who had large positions in derivatives of several banks sold heavily ahead of their expiry. Dealers said the fall in the stock prices ahead of the expiry of contracts is normal.

Buying intensifies

IF the exit poll results were the main factor for selling by most of the market players, it was buying time for local institutions such as UTI and LIC.

Dealers said these two institutions were buying index heavy weights in the last one hour of trading. The buying was also in other index stocks such as Tata Motors and Tata Steel. They said the market had over-reacted to the outcome of the exit polls and the fund managers of these institutions were taking this as a buying opportunity. Another factor for the buying in the index stocks was good financial results to be announced by most of these companies.

Virendra Verma

More Stories on : Stock Markets | Ear to the ground

Article E-Mail :: Comment :: Syndication :: Printer Friendly Page

Stories in this Section
Bank of Maharashtra `de-materialisation' process progressing

`Star struck' MFs look to team-based initiatives

Principal Global invests most in European stocks

Bearish trend to persist

Sensex sinks on poll forecast — Loses 213 in heaviest fall in 3 years

Krone volume, price rise on dividend bonanza

Bank stocks crash as RBI announces dividend policy

e-choupal may add value to ITC

Outlook positive for ACC, Tata Motors

Ranbaxy Labs, Cipla, HDFC Bank buck trend