February 21, 2013 / 11:26 AM / 5 years ago

RPT-Indian shares post biggest fall in 7 months; bank shares hit

(Repeats for wider distribution)
    * BSE ends 1.62 pct down; NSE falls 1.53 pct
    * Indian banks' credit growth drags

    By Manoj Dharra
    MUMBAI, Feb 21 (Reuters) - Indian shares posted their
biggest fall since July 2012 as banking stocks such as ICICI
Bank fell a day after RBI data showed loan growth was
still a concern and on weakness in global shares due to worries
over Fed slowing its bond-buying programme.
    This was largely a reflection of the fall in risk assets
which fell after minutes of the Federal Reserve's last policy
meeting cast doubts over how much longer the U.S. central bank
would stick to its stimulus plan.
    "The selling pressure is more global, than due to local
factors. Some liquidation might continue after such high
inflows," said Phani Sekhar, a fund manager at Angel Broking.
    The government may peg its fiscal deficit target at 4.8
percent of GDP for the next fiscal year, but it needs to explain
as to how the figure is arrived at, he said.  
     The Union Budget to be presented on Feb. 28 will be keenly
watched as a test of the government's commitment to fiscal
responsibility, whether it has a credible plan for reducing the
deficit and whether populist measures can be avoided before the
general elections in 2014. 
    The BSE index fell 1.62 percent, or 317.39 points,
to end at 19,325.36, posting its biggest daily fall since July
23, 2012.
    The index closed at its lowest level since Dec. 24, 2012.
    The 50-share NSE index fell 1.53 percent, or 90.80
points, to end at 5,852.25.
     Banking shares were among the major losers after RBI data
showed loan growth continued to remain a concern. ICICI Bank
 fell 3.74 percent while State Bank of India 
ended 1.84 percent lower.
    Banks' advances have grown 8.7 percent so far this fiscal
year compared with 11.2 percent a year earlier, while deposit
growth was 7.8 percent compared with 11.4 percent in the same
period a year earlier. 
    Yes Bank fell 4.37 percent while Axis Bank
 declined 2.4 percent. 
    Reliance Industries fell 1.8 percent after a 3.1
percent surge on Wednesday. 
    Weak sentiment led to sell-off in blue-chip metal shares
such as Tata Steel, which ended 4.05 percent lower,
and Jindal Steel and Power which declined 4.1 percent.
    Cigarette maker ITC ended 1.13 percent lower on
concerns over a hike in taxation in the upcoming budget, which
might impact its volume, dealers said.      
    ABB fell 3.5 percent after the company reported a
74 percent fall in its October-December net profit at 167.7
million rupees. 
     Shriram Transport Finance Co Ltd slumped 7.5
percent after U.S. private equity firm TPG Capital 
raised $305 million by selling about half of its stake in the
company, at a discount to Wednesday's closing price.     
    Shares in Videocon Industries Ltd gained 5.8
percent after the consumer electronics and oil company said it
was in talks to sell its 10 percent stake in an oil and gas
block off the coast of Mozambique and Tanzania. 

 (Editing by Subhranshu Sahu)
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