Mumbai: Most Indian stocks fell. Bharti Airtel Ltd, the nation’s largest mobile-phone operator, declined after a newspaper reported that the government may ask companies to pay for additional spectrum.
Bharti dropped for the first time in five days. India plans to ask mobile-phone companies to pay for extra bandwidth they got from 2001, The Times of India reported on 18 December, citing people it didn’t identify.
Reliance Communications Ltd, the second largest, lost 2.1%. Hero Honda Motors Ltd, the maker of half the motorcycles sold in India, jumped the most in 19 months after saying that Honda Motor Co.’s sale of a $1.9 billion stake will lead to lower technology-royalty payments.
Also See Subdued Sentiment (PDF)
The Bombay Stock Exchange’s sensitive index, or Sensex, was little changed at 19,888.88 points, at close in Mumbai. Seventeen shares fell as 13 gained. Companies on the measure are valued at an average 18.8 times estimated earnings, compared with a recent peak of 20.1 times on 5 November. The S&P CNX Nifty Index on the National Stock Exchange was little changed at 5,947.05. The BSE 200 Index declined 0.1% to 2,460.59.
“Investors are aligning their portfolio to shares where the risk-reward is attractive,” said Avinash Gupta, an analyst at Bonanza Portfolio Ltd, a New Delhi-based brokerage. “They are buying shares where there is earnings comfort due to the news flow.” He declined to comment on specific shares.
Bharti decreased 2.7% to Rs 335. Reliance Communications Ltd, the second biggest cell-phone operator, lost 1.6% to Rs 126.85. Nine companies that got spectrum beyond the upper limit include Bharti and Reliance Communications, the Times of India said, citing the Comptroller and Auditor General.
Hero Honda jumped 18% to Rs 1,980.5, its steepest climb since May 2009. “Royalty payments will fall from as early as January as the company develops more models itself,” Hero Group said last week after agreeing to buy Honda’s stake in the motorcycle-maker. The shares were upgraded by at least four brokerages, including Antique Stock Broking Ltd.
SKS Microfinance Ltd slid 8.9% to Rs 604.25. Citigroup Inc. cut the lender’s rating to sell from hold, saying new regulations may affect earnings, growth and asset quality. Andhra Pradesh on 16 December passed a law to regulate interest rates and recovery practices among companies offering loans to the poor.
Overseas investors sold a net Rs 10 crore of Indian shares on 15 December, reducing this year’s record inflows in equities to Rs 1.3 trillion, according to data on the website of the Securities and Exchange Board of India.