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Fundamentals May 20, 2013

Nik's Diary
The Indian markets open in green tracking positive opening in most of the Asian markets, tracking a positive global lead after US indices notched another record finish on Friday. US markets moved sharply higher over the course of the trading day on Friday, benefiting from some upbeat US economic data as well as comments from a Federal Reserve official. Thomson Reuters and the University of Michigan reported that the preliminary reading on their consumer sentiment index for May came in at 83.7 compared to the final April reading of 76.4, which is the highest level since July of 2007. A separate report from the Conference Board showed that its economic index rose by 0.6% in April following a revised 0.2% decrease in March. Meanwhile Indian markets rose for a fourth straight session on Friday, driven by renewed FII buying, with power, capital goods and realty stocks led the gainers, while consumer durable, healthcare, metal and oil/gas stocks ended on a downbeat note. Sentiment improved late in the session amid reports global ratings agency Standard & Poor's has affirmed India's sovereign rating at BBB-minus with a negative outlook.

CAT directs cement companies to deposit `630cr
The Competition Appellate Tribunal has ordered some of the country’s biggest cement manufacturers to pay Rs 630 crore while it hears their appeal against a penalty imposed by Competition Commission of India last year. The Tribunal has asked the cement companies to pay 10 per cent of the Rs 6,307-crore penalty imposed on them for forming a cartel. The companies have been directed to deposit the penalty within one month from the date of issue of the order. In June last year, the Competition Commission(CCI) had found companies such as Lafarge India, India Cement, JP Associates, Binani Cement, Ambuja Cement, Madras Cement and JK Cement indulging in cartelisation. In the petitions, the cement producers had challenged the penalty imposed on them by the CCI and the Rs 73-lakh fine on the Cement Manufacturers Association. The order was passed following a probe by CCI based on a complaint filed by the Builders Association. CCI had found cement makers guilty of manipulating supplies and prices to post huge profits at the cost of consumers and the economy. A three-member Competition Appellate Tribunal Bench headed by Chairman Justice V.S. Sirpurkar asked the 11 cement producers and their lobby group CMA to pay around Rs 630 crore within a month. The Tribunal also said that it would dismiss the companies’ appeal if they failed to pay the fine on time. The Tribunal also refused to stay the orders of ‘cease and desist’ that was imposed by CCI. Sources said that the matter would now come up for final hearing in August. Meanwhile, industry watchers pointed that the cement makers can approach the Supreme Court challenging the interim order of the Tribunal. Interestingly, globally, too, cement makers are under the scanner of competition regulators. In recent times, Korea, Pakistan, Europe, Romania, Taiwan and Argentina have penalised manufacturers for cartelisation. Source: thehindubusinessline




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