Sun Pharma up as brokers welcome Ranbaxy purchase

Shares in Sun Pharmaceutical Industries (SUN.NS) gain as much as 7.95 percent, adding to their 2.9 percent rise on Monday, as brokers upgrade the stock after Sun agreed to buy Ranbaxy Laboratories Ltd (RANB.NS) for $3.2 billion.

Sun Pharma is heading for its biggest single-day percentage gain since May 2009. UBS upgraded Sun Pharma to "buy" from "neutral" and raised its target to 720 rupees for 660 rupees on Wednesday, citing the expected contribution to earnings from Ranbaxy.

"We believe the deal makes sense given limited overlap for Sun and Ranbaxy in India and Sun's limited presence in ROW (rest of world) markets, UBS said in a report dated Tuesday, adding Sun would be able to cut administrative and research and development costs.

On Monday, Bank of America Merrill Lynch also upgraded Sun Pharma to "buy" from "neutral", citing a higher price-to-earnings multiple after Ranbaxy's acquisition.

Ranbaxy shares gained 2.2 ercent.

Source: Latest Business Hindi News

From reuters News

BJP gets traders on its side after promise to block FDI

The Confederation of All India Traders’ Association was waiting for the BJP’s manifesto to know about the party’s stand on Foreign Direct Investment in this segment.

“The traders’ community welcomes the BJP’s stand on FDI. We are hopeful that when the party comes to power, it will scrap the FDI in retail launched by the UPA government. The party has also included various demands of the traders’ community in their manifesto,” association secretary general Praveen Khandelwal said.

There is a majority of traders in Chandni Chowk parliamentary constituency and in parts of New Delhi and South Delhi constituencies. The union’s decision will help BJP candidates in all these areas.

“The steps taken by the BJP will go miles ahead in liberating retail trade from the clutches of not only MNCs but even from the vicious net of big corporates that were considering the retail trade as a profit centre by entering into partnership with MNCs,” association national president B C Bhartia said.

“This unhealthy circle encouraged and promoted by the UPA government will certainly come to an end,” Bhartia said.

The traders’ community is always considered as a traditional voter of BJP, but after implementation of FDI in multi-brand retail, the community decided to wait for every party’s manifesto before supporting anyone.

“We sent our demands to every national and regional party and prepared a chart of their manifestos. Some have included parts of our demands and some have totally ignored us. Now BJP has completely supported our cause and the party tops the chart. We have asked the entire fraternity to support BJP,” he added.

Source: Latest Business News Headlines

From deccanherald News

Five key challenges a Narendra Modi government would face

From convincing sceptical bond investors that the fiscal deficit can be contained to concerns that El Nino will devastate agricultural crops, any new government will face urgent and critical challenges with no easy solutions.

Expectations the Bharatiya Janata Party (BJP) and its leader Narendra Modi will win elections that started this week with a new approach to country's economic problems have helped send shares to record highs and the rupee to an eight-month peak.

To some investors that optimism is misplaced. Should Modi win the elections, his government will face its first credibility test with markets when he delivers a budget by June or July that will need to show the country can realistically contain its fiscal deficit.

That will be followed by key decisions on the current account deficit, on the relationship with a hawkish Reserve Bank of India ( RBI), on how much funds to sink into troubled state lenders, and on how to get states to promote private investments.

The BJP promised fiscal discipline and banking reforms among other policy plans when it announced its election manifesto on Monday, but gave no details.

1. Delivering a budget that contains the fiscal deficit

Any new government will need to fix finances that are in dire straits, and about to get worse.

To achieve a revised fiscal deficit target of 4.6 per cent of gross domestic product (GDP) for the year ended in March, the Congress-led government cut spending by $13 billion and pushed about $16 billion in subsidy costs into the new year...

Source: Today Business News

From ET News