SKS Microfinance leads gainers in 'A' group

DB Realty, Unitech, Videocon Industries and Marico are among the other gainers.

Shares of microfinance firm SKS Microfinance spurted 20% to Rs 493.20 extending Thursday's 20% jump triggered by the finance ministry releasing the draft of a bill aimed at developing and regulating microfinance institutions. The stock topped the gainers in the BSE's 'A' group.



The Microfinance Institutions (Development and Regulation) Bill envisions a larger regulatory role for the Reserve Bank of India (RBI) and proposes that all microfinance companies register with the RBI. The central bank would also have the power to cancel the registration or impose a penalty on microfinance companies that violate the rules as per the draft bill.

The Reserve Bank of India had constituted a panel to look into the sector and central bank recently broadly adopted the recommendation of the Malegam Committee to put a cap on interest rates charged and the business margins of microfinance companies. It may be recalled that the Andhra Pradesh state government imposed tight regulations on microfinance companies for allegedly overcharging customers and using coercive methods to recover loans. The RBI later asked the Andhra Pradesh state government to withdraw its rules to remove regulatory ambiguity.

The government's draft microfinance bill proposes to override all existing laws and, if passed by the parliament, will remove the uncertainty caused by the rules imposed by Andhra Pradesh state government.

Real estate company DB Realty jumped 11.90% to Rs 85.60. The stock was second biggest gainer in 'A' group.

Unitech surged 4.43% to Rs 36.55, extending recent gains on reports that the company plans to invest around Rs 2000 crore over the next three years to develop premium and luxury shopping malls. The stock was third biggest gainer in 'A' group.

Videocon Industries gained 3.25% to Rs 200.10. The stock was fourth biggest gainer in 'A' group.

FMCG company Marico moved up 3.07% to Rs 166. The stock was fifth biggest gainer in 'A' group. The stock hit a record high of Rs 169.05 in intraday trade today, 8 July 201