Mumbai: Shares of biotechnology firm Biocon jumped more than 11% on Tuesday, but the Mumbai market was choppy as a large IPO drew investors away.
Biocon was driven by a deal with Pfizer to market insulin made by the Indian company.
Under the agreement announced after the market closed on Monday, Pfizer will pay Biocon $200 million upfront. Biocon will also be eligible to receive milestone payments of up to $150 million plus payments related to sales of these medicines.
Biocon soared as much as 11.2% to a record high of Rs447.90 in a seesawing Mumbai market that was overshadowed by a $3.5 billion initial public offer by state-run Coal India Ltd.
“The Coal India issue is weighing on the market. A good amount of interest is diverted to this IPO from the secondary market,” said Vaibhav Sanghavi, director of Ambit Capital.
Coal India launched the country’s largest-ever IPO on Monday, and its lower-than-expected pricing and exposure to India’s booming electricity demand is expected to draw strong investor interest.
At 10:51am, the 30-share BSE index was up 0.29% at 20,227.08 points, with 19 of its components advancing. It traded in the negative territory earlier. The 50-share NSE index was up 0.3% at 6,093.55 points.
Sanghavi said there was temporary pressures but the undertone remained firmly upbeat. Foreigners have been chasing better returns in emerging markets such as India as the developed world grapples with a slowdown.
Net foreign fund investment in Indian primary and secondary market equities stand at a record $23.3 billion for the year to date, and the BSE index has risen nearly 16% in 2010.
Outsourcers eased on profit-taking. The sector index shed 1%, but is stil up more than 2.5% this month.
Leading software companies Tata Consultancy Services, Infosys Technologies, and Wipro were down between 0.4% and 1.4%.
Indian Oil Corp rose 1.1% after the Economic Times reported the state-run oil refiner is planning a follow-on public share offer to raise about $4.3 billion.
In the broader market, gainers were more than double the number of losers on volume of 140 million shares.
Elsewhere, the MSCI’s measure of Asian markets other than Japan was down 0.2%, while Japan’s Nikkei rose 0.2%.
Bajaj Auto, the country’s No. 2 motorcycle maker, was up more than 1% ahead of September quarter earnings.
Sesa Goa was up 0.6% at Rs374.25, after the top private-sector iron ore exporter said late on Monday September quarter net profit more than doubled.
Crisil Ltd gained 1.1% to Rs6,184.95 after the ratings agency said late on Monday its July-September net profit rose 75.3%.