Tata-Aban deal on Hitech Drilling attracts attention
Mumbai: The recent acquisition of 22.5 per cent stake by Aban Lloyd from the Tata Group in Hitech Drilling Services has attracted attention for possibilities of insider trading.

The Hitech stock which generally generates trading volumes of 1,000 to 5,000, saw unusually high activity in the week before the acquisition was announced. It is understood that on the last trading day of the last week the scrip did a trading volume of 200,000 shares.

Exactly two days after the close of the trading week, the announcement of the acquisition was made. The Aban acquisition was at a price of Rs. 92 per share and this is the price at which the open offer is likely to be made by Aban to acquire the balance 77.5 per cent of the holding. This price is 81 per cent higher than the closing price of the share on Friday.

Going by the sequence of events it is clearly evident that someone, or a group of persons, aware of the acquisition deal, bought shares at the low rate in order to make a quick buck when the open offer is made.

According to informed sources the capital markets regulator, Securities and Exchanges Board of India (Sebi) is likely to initiate an investigation into this unusual increase in trading volumes of the share.
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Bank of Madura joins the insider trading list
Mumbai: According to investigations, a leading diamond trader reportedly bought more than 5 lakh shares of Bank of Madura two days before the announcement of the merger of that bank with ICICI Bank.

For a share that attracted a trading volume of only 150 shares on December 5 last year, on December 6, there were 5.9 lakh shares of the bank that were traded on the BSE. Of this, more than 5 lakh shares are said to have been bought by this diamond trader. On December 8, the day on which the merger between the two banks was announced, volumes at the BoM counter were 22,000 shares.

The seller must, obviously, be more than regretting having sold at that price, since the share price of BoM zoomed after the announcement. Considering that the merger ratio that would have given the seller two shares in ICICI Bank adds up to a huge loss for the seller.

While Sebi officials state that a probe is on, they are not talking about the diamond trader.
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CSE initiates proceedings against defaulting brokers
Kolkota: Default proceedings were initiated by the Calcutta Stock Exchange authorities against three brokers as the total shortfall for the last two settlements stood at Rs 45 crore.

The president of the exchange announced that show-cause notices had already been issued to the three brokers, who have been given 48 hours to file replies. This action has been taken in accordance with the bye-laws of the exchange.

The president also stated that there should be no cause for concern as the exchange had enough cover to meet any eventuality. When asked about the size of the Settlement Guarantee Fund of the exchange, he did not give any indication to that effect, adding that the amount available under the corpus was "enough".
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Tata Industries to make open offer for TAML
Mumbai: Tata Industries, which holds 77 per cent of the equity of Tata Advanced Materials, has made an open offer to acquire the 17 per cent of equity held by the public. Other companies and associates of the Tata group, including Telco and Tata Investment Corporation, hold six per cent of TAML’s equity of Rs. 23.3 crore.

Shareholders are being offered Rs 15 per share by Tata Industries. The shares of TAML, which are listed on the Bangalore and Mumbai stock exchanges, are not being actively traded.

The company was incurring losses for the last six years and was referred to the Board for Industrial and Financial Reconstruction in 1999.
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Despite meltdown, mutual funds prefer TMT stocks
Mumbai: Despite the downturn in the stock markets, the mutual fund industry seems to continue having a fancy for telecom, media and technology stocks.

In the case of the Unit Trust of India, for instance, the weightage of TMT stocks is 19.6 per cent though the figures are less than the height of the stock boom. Alliance Capital may have reduced his exposure to the TMT sector from a peak of 50-55 per cent to 32 per cent; but that's still way above the benchmark followed by Alliance Capital- the BSE 200, weight has a weight of 32 per cent in TMT.

However even within the technology sector most MFs are shying away from small cap and mid cap stocks.

According to Canbank Investment Management Services executive director RK Madhukar, the fund is investing only in top tier IT stocks. DSP Merrill Lynch is also focusing on large cap stocks.

With the front runners now available cheap, MFs prefer the larger and more liquid companies that are more likely to survive the downturn than their smaller brethren.

AT IDBI Principal MF, the fund house has not invested in telecom stocks and has an underweight position in media stocks. It's also reducing its TMT sector weightage from 25.7 per cent in favour of old economy stocks.
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Sebi seeks pay-out details of former BSE directors
Mumbai: As part of its ongoing investigations into the stock market crisis, the Securities and Exchanges Board of India (Sebi) has asked for the pay-out details of former BSE directors, Anand Rathi, Deena Mehta and Mohan Vijan.

Sebi, as per its investigation, is also in the process of seeking pay-out details of top 100 brokers across the country, sources said.

The pay-out details will also give a clear picture on the alleged involvement of the office-bearers of the BSE.
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Mahindra debentures get lower Crisil rating
Mumbai: Leading tractor and utility vehicles manufacturer, Mahindra & Mahindra saw its long-term debentures being downgraded by Crisil from AAA to AA+. It was only a year ago that the rating agency had given these instruments the AAA rating.

The latest downgrade has come about due to the troubled times that the company is currently passing through in its core business of tractors and utility vehicles. The company has been facing stiff competition from Toyota Qualis and has suffered extensively by the decision by five states in the country to ban its hugely soft-top vehicles.

Crisil has, however, reaffirmed the P1+ rating awarded to the company’s commercial paper programme. M&M has also reported that Fitch Rating has reaffirmed the "Ind AA" rating on the company’s long-term debentures and "Ind D-1+" rating on its commercial paper programme.
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Payment default likely in BSE, NSE
Mumbai: If reports in the stock markets are true, after the payment crisis at Calcutta Stock Exchange (CSE), there is now a fear of defaults by stock brokers at the country's top bourses - the Bombay Stock Exchange (BSE) and the National Stock Exchange (NSE).

It is expected that at least seven or eight brokers of the BSE and the NSE are likely to default in the next pay-in day, slated for Wednesday and Tuesday respectively.

While the magnitude of the problem is likely to be much less than that of the Calcutta exchange, authorities at the two exchanges are confident that despite the problems being faced by some brokers, the exchange had enough assets to meet any eventuality.

Meanwhile, two directors of a broking firm, which is under investigation by Sebi for alleged market manipulation during the March 2 crash, were rumoured on Tuesday to have fled the country, fearing a major backlash from its clients.
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