Badla charges remain subdued at Mumbai bourse

Sunday, November 23 1997

Badla charges remain subdued at Mumbai bourse

Our Market Bureau

Mumbai, Nov 22: The carryforward charges on the Bombay Stock Exchange remained at lower levels. The second settlement of the modified carry forward system (MCFS) saw a further jump in volumes. Outstanding volumes stood at Rs 195 crore, up by 12.7 per cent from last week's position of Rs 173 crore. In the previous week, volumes registered a 13 per cent growth. Increase in individual broker limit from Rs 5 crore to Rs 20 crore, apart from removal of limit on single scrip, seems to have boosted volumes.

Of the 96 stocks, 14 attracted backwardation. The jump on the Hindustan Lever counter is quite impressive. As compared to Rs 4.10, the backwardation charges stood at Rs 27.09 for HLL this time. Volumes too rose from Rs 2.72 crore to Rs 4.91 crore whereas the hawala rate remained at Rs 1330, up by Rs 40 from the previous week's Rs 1290.

"Rise in backwardation charges coupled with a price rise is an positive indication," said a Mumbai-based broker. Another counter which showed a sharp jump in backwardation charges was ACC. Backwardation charges zoomed from Rs 3.63 to Rs 23.51.

At the same time, hawala price was marginally up to Rs 1185. Some market observers feel that it is an indication of bullish short-term outlook.The opposite seems to have happened on the Hero Honda counter, while the backwardation charges declined from Rs 31.42 to Rs 7.20 the hawala price dipped from Rs 940 to Rs 915.

Another stock where backwardation charges continued was Grasim. This week, backwardation on this counter stood at Rs 4.95 compared to Rs 4.93 last week. Other stocks which attracted backwardation were -- Ashok Leyland (Rs 0.98), BHEL (Rs 1.72) Bombay Dyeing (Rs 1.78), Brittania Industries (Rs 0.97), EIH Limited (Rs 0.35), Indian Hotels (Rs 1.29), Ranbaxy Laboratories (Rs 1.26), SAIL (Rs 0.01), Supreme Industries (Rs 0.47), and Telco (Rs 0.04). Badla rates for pivotals like State Bank of India (Rs 0.06), Bajaj Auto (Rs 0.68), L&T (Rs 0.25), ITC (Rs 0.26) and Tisco (Rs 0.20 ) remained significantly low.