Grant Thornton UK LLP's India Watch Index rose by 1.9% in Q2 2014, the first rise in the Index for more than a year, coinciding with greater investor optimism towards India. When tracked against the FTSE 100 at 2.2% it follows a close second and falls competitively ahead of the FTSE AIM 100 which lags behind at -11.4%.
In terms of strong performers, it was a mixed bag for oil and gas producers and electricity providers. A combination of operational developments, corporate activity and anticipated economic policy changes largely drove Q2’s movers and shakers with Oilex, Hardy Oil and Gas, and OPG Power Ventures all up. Indus Gas and KSK Power Ventur, on the other hand, were down.
Anuj Chande, Partner and Head of the South Asia Group at Grant Thornton UK LLP, commented: "We remain cautiously optimistic on India after the National Democratic Alliance (NDA) government came to power with the strongest parliamentary majority in 30 years. The short-term outlook will depend on economic reforms and policies introduced by the new government.
"We anticipate that there will be renewed confidence over the next year, among investors and issuers alike, which should lead to IPO activity in the medium to long term. A great deal will, however, depend on the decisions and actions of the NDA government. We will be watching this space closely over the coming months."
Real estate also showed promise with Unitech Corporate Parks (UCP), agreeing to sell its entire stake in Candor Investments Limited (the holding company for UCP’s property interests) to Brookfield Property Partners for a cash consideration of £205.9 million. The stock was up 36.8%, largely reflecting the estimated capital returns to shareholders.
Amongst those that underperformed were KSK Power Ventur, which focuses on power generation, down 28.2%. KSK Energy Ventures (its Indian unit) raised around $67.5 million through a qualified institutional placement in June 2014, diluting KSK Power Ventur’s shareholding from 74.94% to 67.6%.
Also iEnergizer, saw its share price plummet 62.1% when the company issued a trading update in May 2014 announcing reduced profits for the year to March 2014.