A lacklustre rail budget snapped the two-day gains of the BSE barometer Sensex, which shed 30 points today as investors remained cautious ahead of the budget.
Amid weak global advices, Sensex opened nearly 100 points down and continued to remain range-bound as wary operators remained cautious ahead of the expiry of February contracts on Thursda- and the budget day after.
Finally the 30—issue bellwether closed 30.35 points or 0.19 per cent down at 16,255.97 after touching a high of 16,328.44 and a low 16,187.44. The Sensex had shot up 254.56 points or 1.74 per cent on the previous rail budget day.
The wide-based NSE Nifty also lost 11.45 points to 4,858.60, after moving between 4,880.55 and 4,834.65.
Railway Minister Mamata Banerjee kept passenger fares and freight rates unchanged but reduced freight rate for kerosene foodgrain, and fertiliser, which will bring down inflation.
Though Mamata ruled out privatisation, she invited private investment in railways and promised to clear such proposals within 100 days. However, the market was upset as she did not increase wagon order rate, which fuelled concern that the budget may rollback stimulus measures, and thus arrested the rally in the rail-related stocks.
Angel Broking chairman Dinesh Thakkar said, “The railway budget is a non-event from the market perspective even though it is overall positive in its intent and future direction. The budget is devoid of any major populist measures and focused on developing and improving rail infrastructure, including inviting investments through public-private-partnerships.”
Similarly, shares of Engineers India shed 1.86 per cent during the day to a low of Rs 1,920.80. It later closed at Rs 1,929, down 1.45 per cent on BSE.
Analysts said as the rail budget was on expected lines, sector-specific shares witnessed heavy profit taking.
Besides, the KK Birla group company Texmaco, which is in the business of wagon manufacturing, dropped 4.69 per cent to end at Rs 142.25. During the intra-day trade the scrip had plunged 8.37 per cent to a low of Rs 136.75.
Further, rail infrastructure developing firm Kalindi Rail was down 5 per cent, the maximum permissible single day plunge for the scrip, to Rs 183.50 on the BSE.
Other major losers include Hind Rectifiers (4.79 per cent), BEML (1.73 per cent), Stone India (5.02 per cent),
Meanwhile, sectoral stocks which bucked the trend are Container Corporation of India (1.19 per cent at Rs 1,198.65), Gateway Distriparks (0.89 per cent) and Simplex Castings (0.61 per cent).
Presenting the budget for 2010-11, railway minister Mamata Banerjee asked business houses to build partnerships with the Railways that employs about 14 lakh people.
A special task force will be set up for early clearance of such projects, Banerjee said, adding that Railways will start six water bottling plants in places like Ambala, Farakka, Nasik, Thiruvananthapuram and Amethi to provide clean and cheap drinking water to passengers.