Stocks

CoS approval on FDI spurs retail stocks

Our Bureau Mumbai | Updated on July 25, 2011 Published on July 25, 2011

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With 51 per cent FDI getting approval by the Company of Secretaries in multi brand retail, stocks in this sector witnessed an upward surge on Monday.

Stocks of big as well as smaller retail houses soared in hopes of final approval of FDI in multi brand retail. Stocks of Pantaloons Retail closed 1.61 per cent higher, striking a monthly high in intra day trade of Rs 351.35 while Brandhouse Retails closed 6.60 per cent higher than its previous close.

The Company of Secretaries gave an approval on allowing 51 per cent FDI in multi brand retail on late Friday evening. Although this has not still been approved by the Commerce Ministry and the Cabinet, the nod by the Company of Secretaries is one step forward in this process.

Mr Kishore Biyani, CEO, Future Group, hailed the move and says that foreign investors are keen to forge alliances with Indian retailers in various categories.

“Pantaloon's key businesses are FDI ready and we expect the company to be a key beneficiary of FDI in retail because of its enviable structure,” said a recent research report from Edelweiss.

Although Shoppers Stop closed 0.02 per cent lower, it was successful in striking an all-time high during the intra day at Rs 504. Koutons Retail also closed 4.78 per cent and Store One Retail surged 4.97 per cent.

“The approval for FDI will be very good for the industry and because of this there will be many joint ventures and partnerships in the future,” said Mr Sharan Lillaney, research analyst, Angel Broking.

There is an anticipation of further increase in stocks till the final Cabinet approval, said brokers.

Published on July 25, 2011
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