Business and Economy  

Stocks: day traders go slow
to protest transaction tax

What is India News Service, July 13, 2004, 1700 hrs IST


Day-traders refrained from work and protested against the 0.15 per cent tax on all securities transactions proposed by finance minister P Chidambaram. Central trade unions pressed for a post-budget meeting with the prime minister. They want a hike in Employees' Provident Fund interest rates. The biotech sector is looking at outsourcing from India, which is turning into a major money spinner. US private equity fund New Bridge Capital plans to invest 200 million dollars to acquire a 40 per cent stake in Global Trust Bank.

Day-traders and jobbers stayed away on Monday, cutting down their trading, to bring the combined turnover on stock exchanges to a one-year low. The traders' action reduced the combined turnover of  BSE and NSE by Rs 3,900 crore. This is the lowest in the last one year, compared to daily average trading volumes of Rs 7,100 crore. Traders warned that they would intensify their fight against the transaction tax on all securities transactions further on Tuesday by going on a 1 day strike.

Central unions want a meeting with the prime minister to reiterate their demand for a hike in the Employees' Provident Fund interest rate. A day before the EPF board meets to take a decision on the rate, unions are seeking restoration of 12 per cent. The trade unions also urged the government to reconsider its decision to pay 8 per cent interest rate on small savings.

The Indian biotech industry is planning to set foot in the outsourcing arena. Currently valued at 120 million dollars, biotech outsourcing is turning out a major money spinner for companies involved in contract and clinical research activities. The  new concept of research process outsourcing (RPO) is finding its feet as well. Biotech outsourcing in from India is growing at a rate of 75 per cent. Experts are of the opinion that the business would touch 1 billion in the next five years.

US private equity fund New Bridge Capital plans to invest 200 million dollars to acquire a 40 per cent stake in Global Trust Bank at a price below the face value of shares. The final deal says New Bridge will initially invest 100 million dollars to acquire a 20 per cent stake. An additional 100 million dollars will be pumped in through warrants that can later be converted into equity shares. The proposal has been submitted to the Reserve Bank of India, whose recent guidelines restrict any individual or company from holding more than 10 per cent stake in a bank.

Overall:

Day traders battle it out: They stopped transactions to protest against the proposed 0.15 per cent tax on all securities transactions.

TUs press for post-budget meet: Central Unions have asked for a post-budget meeting with the prime minister to reiterate their demand for the restoration of 12 per cent interest on provident fund.

Biotech sector keen on outsourcing: Currently valued at 120 million dollars, biotech outsourcing is turning out a major money spinner for companies involved in clinical research.

New Bridge to acquire stake in GTB: The US private equity fund plans to invest 200 million dollars to acquire a 40 per cent stake in Global Trust Bank.