MUMBAI, July 26: After remaining sluggish for many days, the global depository market (GDR) market - where shares of Indian companies are listed - have turned bullish. The GDR market shot up on July 23 with the Skindia GDR Index gaining 3.12 per cent to 79.64 in spite of the political uncertainty India.

With the demand for Indian paper from foreign investors rising, 64 GDRs gained an average of 2.09 per cent compared to a 2.60 per cent rise in the underlying shares. ``GDRs from the textile and pharmaceutial sectors fared well on both the GDR and domestic markets gaining an average 5.07 per cent and 4.40 per cent as compared to 4.82 per cent and 3.10 per cent respectively,'' according to Skindia Finance.

Since June, GDRs from the fertiliser sector have increased an average of 33.06 per cent as compared to a rise of 37.36 per cent in their underlying shares. In the same period the Skindia GDR Index increased by 7.34 per cent to 79.56 and the BSE Sensex increased 10.99 per cent to 4226.57. GDRs of EID Parry increased by 33.33 per cent to touch its 52 week high of $ 4.00, GNFC gained 25.00 per cent to $ 3.75, SPIC rose 73.91 per cent to $ 4.00 and Indo Gulf remained unchanged at $ 1.20.

Skindia said greater trading activity in the GDRs of EID Parry, Indo Gulf and SPIC can be seen from an average decrease in spreads between their bids and offer since June as compared to the first five months of 1997 from 25.23 per cent to 18.71 per cent, 20.75 per cent and 17.30 per cent and 11.02 per cent to 8.13 per cent respectively. However, spreads of GNFC increased from 17.37 per cent to 18.57 per cent, indicating that prices have increased amidst low volumes.

In the domestic market, the underlying shares of EID Parry increased by 43.48 per cent to Rs 132. GNFC gained 13.64 per cent to Rs 25, Indo Gulf rose 23.66 per cent to Rs 40.50 and SPIC gained 68.66 per cent to Rs 28.25. Since, June, average daily turnover of Indo Gulf and SPIC increased an average of 52.37 per cent to Rs 0.26 crore and 690.89 per cent to Rs 0.47 crore respectively compared to an average of the first five months of 1997. However, domestic turnover of EID Parry and GNFC declined 48.27 per cent to Rs 0.02 crore and 18.27 per cent to Rs 0.10 crore.

Meanwhile, it is learnt that Mahanagar Telephone Nigam Ltd (MTNL) is likely to hit the international markets with a $ 850 million GDR issue, making it the largest international float ever by an Indian corporate.

MTNL had earlier indicated that its GDR offering would be in the range of $ 400-500 million but its revision in size follows the government's decision to disinvest as well issue fresh equity to the tune of 107 million shares. Reliance Industries will seek shareholers approval at its forthcoming EGM to increase the limit of FII holding.

Copyright © 1997 Indian Express Newspapers (Bombay) Ltd.