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Fundamentals February 26, 2013


Nik's Diary
The Indian market opened in the red following the negative opening in SGX Nifty and most other Asian markets after signs of an inconclusive general election in Italy sparked worries that another chapter in Europe’s debt crisis could be opening. The US market showed a substantial downturn on Monday on the back of uncertainty about the outcome of elections in Italy. Moreover, uncertainty about whether lawmakers in Washington will be able to reach an agreement to avoid the automatic government spending cuts, due to go into effect at the end of the month, also weighed on the markets. European stocks also gained ground as investors awaited Italian poll results. Meanwhile, Indian shares ended a volatile session largely unchanged on Monday despite firm global cues. The underlying sentiment remained cautious as investors await the upcoming Railway Budget and Union Budget this week for directional cues.

Ranbaxy restarts generic Lipitor production for US market 
Pharma major Ranbaxy Laboratories today said it has restarted production of generic cholesterol lowering drug Atorvastatin as it looks to resume supplies to the American market. In November last year the company had recalled Atorvastatin, the generic version of Pfizer's Lipitor, for select batches in the strengths of 10mg, 20mg and 40mg tablets from the US market due to presence of foreign particles. Since then it has been working with the US Food and Drug Administration (USFDA) to implement multiple corrective and preventive actions. "As part of the first step in initiating the manufacturing process to resume supplies to US market, we have commenced the production of drug substance for our Atorvastatin product," the company said in a statement. The recall had affected 41 lots of Atorvastatin Calcium tablets (10 mg, 20 mg and 40 mg), which is a solid oral dosage form, up to the retail level. "The recall did not affect or relate to the 80 mg strength," Ranbaxy said. Ranbaxy had launched generic Atorvastatin in the US market in December 2011 after the USFDA gave final approval to market its generic version of Lipitor produced at Ohm Laboratories facility in New Brunswick, New Jersey. Ohm Laboratories is a wholly-owned subsidiary of Ranbaxy. In April last year, the company started commencement of shipping of cholesterol lowering drug, Atorvastatin calcium oral tablets from its Mohali SEZ plant in Punjab. Shares of Ranbaxy Laboratories were trading at Rs 426.30 per scrip in the afternoon on the BSE, up 3.15% cent from its previous close. Source: AngelBroking

Workers at HMCL’s Gurgaon unit to go on hunger strike
The workers at Hero MotoCorp’s Gurgaon unit will go on a hunger strike from Thursday to demand higher wages. In a meeting on Monday with members of the company’s Dharuhera facility, members of Hero MotoCorp Workers’ Union (HMCWU, Gurgaon unit)  decided to initiate an indefinite fast from February 28. “Even in the latest round of talks held with the management last Friday, the company refused to budge from their stance. We have the support of our colleagues at Dharuhera. We have now decided to go on hunger strike to press our demands. A notice has been sent to the company,” said Bhim Rao, general secretary, HMCWU. No date has been finalised for the next round of talks. Only the union members of HMCWU will go on hunger strike, so that production is not hampered at the facility. Workers at the Gurgaon unit have been agitating for the past two months for higher wages. They have been sporting black arm-bands and have stopped taking tea and snacks offered by the company. While the employees are demanding an increment of around Rs 15,000 in monthly salary, spread over a period of three years, the management is reluctant to increase wages beyond Rs 7,500-9,000 in monthly settlement. “We have not stopped work but have been protesting peacefully. But the management is showing no signs of relenting,” said a worker at the Gurgaon factory. Last month, workers at the unit reportedly slowed production operations. Following this, the company issued showcause notices against six members of the union for disrupting production operations on January 23 and January 24. The workers at the Gurgaon factory had also held a ‘gate meeting’ on February 12 where strike was discussed as a last resort. The meeting was attended by members of CITU, INTUC, AITUC and union members from Maruti Suzuki and Honda Motorcycle and Scooter India. Hero MotoCorp has three facilities across Gurgaon, Dharuhera and Hardwar. The Gurgaon unit rolls out 6,000-7,000 two-wheelers a day. The company employs around 1,200 permanent workers and 4,000 contract workers at its Gurgaon facility. The average salary of a permanent worker at Gurgaon currently is around Rs 32,000, which goes up to Rs 38,000 for more experienced employees. Source: AngelBroking

Sadbhav Engineering emerges successful bidder for Northern Coalfields project
Sadbhav Engineering Ltd has been declared the successful bidder in respect of the bid invited by Northern Coalfields Limited (A subsidiary of Coal India Ltd.), Singrauli ( M.P.) for the project for estimated contract value of Rs. 697.35 Crores. The order is for excavation of overburden of first dig (solid) by hiring of equipment such as Excavator, Dumpers/Tippers, Drills, Dozers, Graders and Water Sprinklers for composite work consisting of blast hole drilling, excavation, loading, transportation of broker rocks/soil/earth, unloading/dumping, spreading, dozing, water sprinkling and grading etc. by mechanical means as per instruction of Engineer-in-charge at specified places of Amlohri OCP of NCL. The total quantity for the excavation of over burden (OB) is 100.00 Million BCM. The Sadbhav Engineering Ltd stock was trading at Rs.112.05, up by Rs.3.35 or 3.08%. The stock hit an intraday high of Rs.114 and low of Rs.110.85. The total traded quantity was 4.50 lakhs compared to 2 week average of 0.82 lakhs. Source: EquityBulls






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