In the week gone by, after Fed policymakers estimated their benchmark rate would rise twice by late 2023, earlier than a previous forecast of no hikes before 2024, the investors across the globe feared that global central banks may hike rates sooner than expected. Thus global markets witnessed volatile trade. Actually, Ultralow rates from the Fed and other central banks have propelled a global stock market rebound from last year’s plunge amid the coronavirus pandemic. The Fed’s announcement Wednesday reflected growing confidence in the US economy as more people are vaccinated against the coronavirus and business activity revives. However Investors are worried the Fed and other central banks might feel pressure to withdraw stimulus to cool rising inflation. The European Central Bank in the recent meeting said it was too early to debate closing the money taps despite a recent rise in inflation. Meanwhile, U.K. inflation exceeded expectations in May. The Consumer Price Index rose 2.1% year-on-year and 0.6% month-on-month. On the another development, the BOJ also maintained its massive monetary stimulus to support the country’s economic recovery and extended a deadline for asset-buying and loan programmes introduced last year to channel funds to pandemic-hit firms. The Bank of Japan unveiled a plan to boost funding for fighting climate change, in a surprise move underscoring the importance of the issue for central banks. Japan’s central bank said it expects to launch the climate change scheme by the end of this year, and will release a preliminary outline of its plan at its next policy-setting meeting in July. Meanwhile, Japan’s inflation has edged into positive territory for the first time in 14 months as rising commodity costs have fed higher gasoline prices at the pump.
Back at home, domestic markets witnessed a volatile trade tracking global cues. Losses in metals, banks and energy stocks weighed the most on the indices. Macro signals continue to be mixed. Rising CPI inflation (6.3% in May) is a major concern. While for the month of April 2021, the Quick Estimates of Index of Industrial Production (IIP) with base 2011-12 stands at 126.6. Actually, there was nationwide lock down in 2020 so the comparison was made with the April 2019. To note, April's industrial output was just 0.08% higher than the pre-pandemic levels of April 2019. On the flip side, the Indian economy began regaining momentum in June, ultra-high frequency data indicate, though subdued consumer sentiment is expected to limit the pace of recovery in Asia’s third largest economy. The reduction is COVID cases in India is certainly comforting the participants. Besides, going forward, movement of Currency, opening up of the economy in a phased manner, inflow and out flow of foreign fund, monsoon update and crude oil prices will continue to dictate the trend of the market..
On the commodity market front, Dollar index and US treasury yield northward journey put sharp pressure on entire commodities space and CRB closed lower. The dollar index jumped to its highest level in two months against its rivals. Commodities complex is going through a correction phase. Bullion prices dropped after long consolidation; breached $1800 mark while base metals were in additional pressure as China asked to release metals from strategic reserve to contain the inflation. Reduction in base prices in edible oil by Indian government put pressure on oil seeds and edible oil. Some bounce in commodities we can expect in this week. Gold and silver may rise upto 48500 and 70000 respectively. Crude may consolidate in a range of 5000-5450. BoE Interest Rate Decision, Markit Manufacturing PMI Flash, Durable Goods Orders and GDP Growth Rate, Core PCE Price Index, Michigan Consumer Sentiment Final and PCE Price Index of US, GfK Consumer Confidence of Germany etc are many important triggers, which may give direction to the commodities prices.
SMC Global Securities Ltd. (hereinafter referred to as “SMC”) is a registered Member of National Stock Exchange of India Limited, Bombay Stock Exchange Limited and its associate is member of MCX stock Exchange Limited. It is also registered as a Depository Participant with CDSL and NSDL. Its associates merchant banker and Portfolio Manager are registered with SEBI and NBFC registered with RBI. It also has registration with AMFI as a Mutual Fund Distributor.
SMC is a SEBIregistered Research Analyst having registration number INH100001849. SMC or its associates has not been debarred/ suspended by SEBI or any other regulatory authority for accessing /dealing in securities market.
SMC or its associates including its relatives/analyst do not hold any financial interest/beneficial ownership of more than 1% in the company covered by Analyst. SMC or its associates and relatives does not have any material conflict of interest. SMC or its associates/analyst has not received any compensation from the company covered by Analyst during the past twelve months. The subject company has not been a client of SMC during the past twelve months. SMC or its associates has not received any compensation or other benefits from the company covered by analyst or third party in connection with the research report. The Analyst has not served as an officer, director or employee of company covered by Analyst and SMC has not been engaged in market making activity of the company covered by Analyst.
The views expressed are based solely on information available publicly available/internal data/ other reliable sources believed to be true.
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SAFE HARBOR STATEMENT: Some forward statements on projections, estimates, expectations, outlook etc are included in this update to help investors / analysts get a better comprehension of the Company's prospects and make informed investment decisions. Actual results may, however, differ materially form those stated on account of factors such as changes in government regulations, tax regimes, economic developments within India and the countries within which the Company conducts its business, exchange rate and interest rate movements, Impact of competing products and their pricing, product demand and supply constraints. Investors are advised to consult their certified financial advisors before making any investments to meet their financial goals.
Bank has posted robust improvement in asset quality on sequential basis as well as over a year earlier level. Bank has maintained stable Net Interest Margin (NIM) helping Net Interest Income (NII) growth to accelerate in Q4FY2021. Thus, it is expected that the stock will see a price target of Rs.471 in 8 to 10 months’ time frame on an expected P/BVx of 1.5 and FY22 BVPS (Book Value Per Share) of Rs.314.04.
In line with that, the company is expected to increase focus on development of new carbon black grades for specialty applications such as for ink, coatings and plastics and masterbatch segments.
According to the management, with about 70% capacity utilisation, along with plans for new additions, the company has enough opportunity to meet carbon black demand in various end markets. Moreover, volume growth may be good driven by improvement in freight movement along with steady pace of road construction, pick-up in mining activity amid government focus on infrastructure and continued e-commerce demand and it would also be aided by prospects for import substitution. It is expected that the stock will see a price target of Rs.265 in 8 to 10 months time frame on a three year average P/BVx of 2.10x and FY22 BVPS of Rs.126.11.
The stock closed at Rs 246.60 on 11th June, 2021. It made a 52-week low at Rs 498.55 on 17th June, 2020 and a 52-week high of Rs. 746.00 on 10th March, 2021. The 200 days Exponential Moving Average (DEMA) of the stock on the daily chart is currently at Rs 4318.48.
Short term, medium term and long term bias are looking positive for the stock as it is trading in higher highs and higher lows on charts. Apart from this, it was formed an “Inverted Head and Shoulder” pattern on daily charts and has given the neckline breakout of pattern along with high volumes so follow up buying may continue for coming days. Therefore, one can buy in the range of 702-707 levels for the upside target of 780-800 levels with SL below 670 levels.
The stock closed at Rs 4998.75 on 18th June, 2021. It made a 52-week low of Rs 2620.75 on 19th June, 2020 and a 52-week high of Rs. 5880 on 06th Jan, 2021. The 200 days Exponential Moving Average (DEMA) of the stock on the daily chart is currently at Rs 4318.48.
After registering all time high, stock witnessed some healthy profit booking from higher levels and found support around 4200 levels. Then after it was consolidated in narrow range of formed a “Triangle” pattern on weekly charts, which is bullish in nature. Last week, stock has given the pattern breakout along with high volumes and also managed to close higher so buying momentum may continue for coming days. Therefore, one can buy in the range of 4930-4960 levels for the upside target of 5400-5500 levels with SL below 4650 levels.
Disclaimer : The analyst and its affiliates companies make no representation or warranty in relation to the accuracy, completeness or reliability of the information contained in its research. The analysis contained in the analyst research is based on numerous assumptions. Different assumptions could result in materially different results.
The analyst not any of its affiliated companies not any of their, members, directors, employees or agents accepts any liability for any loss or damage arising out of the use of all or any part of the analysis research.
SOURCE: RELIABLE SOFTWARE
Charts by Reliable software
Indian markets witnessed quite a volatile session in the week gone by as Nifty slipped towards 15500 levels after testing all time high above 15900 levels as traders were keen to book profits at higher levels after outcome of Federal Reserve meeting. From derivative front call writers were seen adding hefty open interest at 15800 & 15700 strikes while put writers added open interest at 15500 strike. Banking counter once again remain laggard in the week gone by while FMCG and IT counter try to give some support to markets. The Implied Volatility (IV) of calls closed at 14.26 % while that for put options closed at 15.32%. The Nifty VIX for the week closed at 15.29%. PCR OI for the week closed at 1.07. From technical front markets are likely to remain choppy in upcoming sessions as well as secondary oscillators suggests lack in directional trend. Traders should remain focus on stock specific moves. As far levels are concerned Bank Nifty likely to face strong hurdle in zone of 35000-35500 while on downside 15500-15400 zone would act as strong support area for Nifty.
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**The highest call open interest acts as resistance and highest put open interest acts as support.
# Price rise with rise in open interest suggests long buildup | Price fall with rise in open interest suggests short buildup
# Price fall with fall in open interest suggests long unwinding | Price rise with fall in open interest suggests short covering
Turmeric futures (July) is likely to decline towards 7200-7000 levels. The sentiments are bearish on the spot markets and prices are quoting lower due to sluggish demand from local stockists amid poor quality of arrivals in the market. Turmeric prices are quoting lower in Nizamabad, Warangal and Nanded mandis due to lower demand from overseas market. Last week, jeera futures (July) hit a fresh four-month low as demand is expected to be weak amid subdued buying from the local and overseas market. Supply pressure in the market is also weighing on prices. Farmers in need of money to start kharif sowing and easing of COVID-related restrictions led them to offload huge stock in the market. In days to come, this bearishness shall continue & the counter is expected to descend towards 13000-12800. Dhaniya futures (July) if breaks the strong support around 6500, then shall witness a steep fall towards 6400- 6200. Coriander prices edged lower in spot markets of Rajasthan, Gujarat, Madhya Pradesh, Delhi due to absence of buyers. South India's buyers have not placed large orders in Rajasthan' mandis for the past ten days. Gujarat and Madhya Pradesh are also battling with weak demand vis-a-vis supply. Domestic demand has also weakened from Maharashtra, especially Mumbai, with auctions relying only on Delhi-based buyers and local mills. The supply side has also been pegged higher at 822,210 tn in the 2020-21 (Jul-Jun) season, up 17.3% on year, according to data from the Spices Board of India. Coriander production is being promoted in Guna district under One District One Production project by the state government in Madhya Pradesh.
Gold set for its worst week since March 2020 after the U.S. Federal Reserve's hawkish turn lifted the dollar and dented the safe-haven metal's appeal. Gold prices were down 5% so far this week, silver over 6%. It was the Fed reversal in policy outlook that triggered the drop in gold prices; the reaction in gold has been somewhat overdone. Despite the current high-growth, inflationary environment, the proposed Fed rate hikes are not expected to set in for at least another 18 months. So after a little bit more weakness here, gold prices will regroup and push higher. The Fed on Wednesday signaled it would be considering whether to taper its asset purchase programme meeting by meeting and brought forward projections for the first post-pandemic interest rate hikes into 2023. Following hawkish comments from Fed officials, the dollar jumped to a two-month high and was on track for its best week in nearly nine months. Though gold is considered as a hedge against inflation, higher interest rates will reduce its appeal as they translate into a higher opportunity cost of holding the metal. On the technical front, gold fell below the psychologically significant $1,800-per-ounce mark and other key support levels, including the 100-day and 200-day moving averages, which is usually viewed as a bearish sign. Ahead in this week, we may continue to witness huge volatility and gold may trade with bearish bias but we may also witness buying from lower levels and range would be 44800-49400 whereas, Silver may trade in the range of 66100-71200 levels. Whereas on COMEX gold may trade in the range of $1750-$1840 and Silver may trade in the range of $25.10-$28.30.
This week, we can see more downside levels of 6200-6000 in soybean futures (July), taking negative cues from the international markets as well as good progress of sowing this Kharif season. It is estimated that in Madhya Pradesh, soybean is likely to be cultivated on an area of 132 lakh hectares during the Kharif season this year, which is 10 per cent more than the area under cultivation the previous year. The Centre has announced MSP of Rs3,950 per quintal for soybean for the 2021-22 Kharif season, which is Rs.70 per quintal more than the last season. U.S soybean path is set for deep losses towards $12.50 a bushel on forecasts of cool and wet weather in parts of the U.S. Midwest. There are expectations of showers to bring relief to dry areas of the crop growing areas in the U.S. Midwest over the next two weeks, improving production prospects.RM Seed futures (July) is expected to plunge towards 6200-6000 taking bearish cues from the soybean & edible oil counters in both domestic as well as international market. Soy oil futures (July) is likely to witness further downfall towards 1050-1020, while CPO futures (June) is expected to see lower levels of 960-930. India slashed the base import prices of palm oil and soybean oil for a fortnight as prices of the cooking oils fell sharply in the global market.U.S Soyoil futures facing pressure following news the U.S. Environmental Protection Agency is considering ways to provide relief to U.S. oil refiners from mandates requiring the blending of biofuels including soy-based biodiesel.
Crude Oil prices rose, and set to close above $75 a barrel as U.S. refiners drew more crude inventories to ramp up activity and meet recovering demand. After the straight 5 days rise the crude oil prices witness selling in last two days of the week as the U.S. dollar soared on the prospect of interest rate hikes in the United States, but they were on track to finish the week little changed and only slightly off multi-year highs. WTI is heading for a slight decline, which would be the first drop in four weeks. The dollar has rocketed in the two sessions since the U.S. Federal Reserve projected possible rate hikes in 2023, earlier than market watchers previously expected. A rising dollar makes oil more expensive in other currencies, curbing demand. The recent movement of oil in the short-term is more likely related to the USD strength that was seen in the past two sessions. Ahead in the week crude oil prices may continue to trade in the range of 5050-5400 with higher volatility. We may witness both side movement in the counter where sell near resistance and buy near support would be strategy. Natural gas prices consolidated and moved slightly lower as prices are already in overbought territory. The weather is expected to be mild and slightly warmer on the coast over the next 6-10 and 8-14 days, according to NOAA. Medium-term momentum is positive but decelerating as the MACD histogram print in the black with a declining trajectory points to consolidation. Ahead in this week, we may expect prices may trade within a tight range where support is seen near 220 and resistance is seen near 240.
Cotton futures (June) will possibly continue to face resistance near 24270 levels & the upside shall remain capped. Sowing is underway in the northern states of Punjab, Haryana, and Rajasthan. Overall, India’s MY 2021/22 cotton production to increase by 4% to 37.8 million bales as compared to last year with an average yield estimated at 498 kilograms per hectare, 5% higher than last year on the expectation of a normal monsoon. In the international market, participants would focus on the June 30th acreage report for clarity on the U.S. production estimates. Guar seed futures (July) is expected to plunge towards 3950-3900, while guar gum futures (July) will probably see lower level of 6100-6000. On the spot, these counters are extending fall as rains received in the major growing regions raised the hopes of good sowing. Prices are down amid selling pressure as stockiest are seen interested in liquidating their stocks. Mentha oil futures (July) is looking bullish & can test 1040-1090 on reports of crop damage. This season the farmers are disheartened to the crop rotting in the field due to stagnant water. The past few weeks have been painful as heavy rains in the pre-monsoon season have damaged his peppermint crop which was ready to be harvested. Leaves have started wilting due to being submerged in water. With the harvesting of the crop, oil extraction work has also started. The Lucknow-based Central Institute of Medicinal and Aromatic Plants (CIMAP) estimated that due to this adverse impact of rains onthe crop in the last two weeks the production is expected to cut down by 30%.
Base metals may see some bounce from the lower side but upside should be limited. Recent fall in base metals definitely a sigh of relief for the economies which are on expansion mode; including India. This fall will raise the physical demand of commodities and may make a gradual base for next upside. The prices may come under pressure as China will issue new rules on the management of price indexes for commodities and services as the government steps up scrutiny of the country’s commodity markets and battles to contain inflation. The Chinese administration, which does not publish its reserve volumes, is estimated by Citigroup to hold 2 million tonnes of copper, 800,000 tonnes of aluminum, and 350,000 tonnes of zinc Copper may trade in the range of 680-740. Supply constraints and growing demand due to rapid economic recovery, especially in China, suggest that the industrial metal’s run-up isn’t over yet. ICSG forecasts a “small” surplus of 80,000 metric tons for 2021. Zinc may trade in the range of 225-240 while Lead can move in the range of 165- 175. As per ILZSG, global demand for refined zinc metal is forecast to rise by 4.3% to 13.78 million tonnes in 2021, after falling by 3.9% last year. Nickel may trade in the range of 1250-1350. Uncertainties about the extent of nickel demand and supply growth have created a volatile market. However, the long term outlook is still strong on the back of electrical vehicle demand. According to a Nornickel report, 2021 will see a surplus of 52,000 tonne which is less than the earlier estimate of 90,000 tonne. Aluminum may move in the range of 185-200.
LEAD MCX (JUN) contract closed at Rs. 169.10 on 17th Jun’2021. The contract made its high of Rs. 178.55 on 10th May’2021 and a low of Rs. 167.20 on 22nd Apr’2021. The 18- day Exponential Moving Average of the commodity is currently at Rs 171.07. On the daily chart, the commodity has Relative Strength Index (14-day) value of 43.673.
One can sell near Rs. 172 for a target of Rs. 164 with the stop loss of Rs. 176.
NATURAL GAS MCX (JUN) contract closed at Rs. 240.30 on 17th Jun’2021. The contract made its high of Rs. 246.90 on 15th Jun’2021 and a low of Rs. 193.00 on 07th Apr’2021. The 18-day Exponential Moving Average of the commodity is currently at Rs. 232.82. On the daily chart, the commodity has Relative Strength Index (14-day) value of 56.740.
One can sell near Rs. 236 for a target of Rs. 220 with the stop loss of Rs. 244.
RM SEED NCDEX (JUL) contract was closed at Rs. 6580.00 on 17th Jun’2021. The contract made its high of Rs. 7640.00 on 10th May’2021 and a low of Rs. 5684.00 on 18th Mar’2021. The 18-day Exponential Moving Average of the commodity is currently at Rs. 6774.33. On the daily chart, the commodity has Relative Strength Index (14-day) value of 34.202.
One can buy near Rs. 6450 for a target of Rs. 6800 with the stop loss of Rs 6275.
Dollar index and US treasury yield northward journey put sharp pressure on entire commodities space and CRB closed lower. The dollar index jumped to its highest level in two months against its rivals, making gold more expensive for holders of other currencies. The benchmark 10-year yield rose to its highest level since June 4 at 1.594%, increasing the opportunity cost of holding non-interest bearing gold.Bullion prices dropped after long consolidation; breached $1800 mark as the dollar and U.S. Treasury yields jumped after Federal Reserve officials projected interest rate hikes sooner than expected. Base metals saw sharp fall on Fed statement and China action plan on base metals. China’s state planner renewed its pledge to step up monitoring of commodity prices and strengthen supervision of spot and futures markets, as domestic producer inflation hit its highest in more than 12 years. China's state reserves administration plans to sell its reserves of copper, aluminium and zinc in a programme expected to last until the end of 2021. Weak economic data from China, which accounts for about half of global copper demand, added pressure to the market as factory output and retail sales missed expectations.The Fed on Wednesday began closing the door on its pandemic-driven monetary policy as officials projected an accelerated timetable for interest rate increases, opened talks on how to end crisis-era bond-buying and said the 15-month-old health emergency was no longer a core constraint on U.S. commerce. It also gave a pause in the rally of crude oil and natural gas. Crude oil prices fell on Thursday pressured by a stronger U.S. dollar, but losses were limited by a big drop in crude oil inventories in the United States, the world’s top oil consumer. Natural gas breached higher levels and made a high of around 247 on warmer weather news. The weather was expected to be mild and slightly warmer on the coast over the next 6-10 and 8-14 days, according to NOAA.
In agri, spices traded more on weaker side. Higher arrivals in the spot are added downside pressure on jeera prices. Dhaniya saw limited upside. The sentiments on the spot markets are bearish as demand is not picking up because most of the key states, including Tamil Nadu and Andhra Pradesh are still under COVID-19 lockdown. Castor prices saw downside. The arrivals are expected rise sharply in the short term as farmers will look to offload stocks ahead of the sowing season in Jul-Aug. Hopes of rise in sowing this year in key growing areas & forecast of normal monsoon rains will aid to the bearish sentiments. Reduction in base prices in edible oil by Indian government put pressure on oil seeds and edible oil.
Wholesale Price Index, or WPI, measures the changes in the prices of goods sold and traded in bulk by wholesale businesses. Simply, the WPI tracks prices at the factory gate before the retail level. Nowadays inflation is rising globally that is major concern for policy makers as it already reached at uncomfortable levels and leading to increased volatility in markets. Inflation in the US has jumped at an annual rate of 5% in May, up from 4.2% in April and the highest since August 2008. British inflation unexpectedly jumped above the Bank of England's target in May when it hit 2.1%. China’s factory-gate price inflation, reflecting wholesale prices, hits near 13-year high and forced China to take steps to curb prices.
WPI in India
Inflation in India is also on its way up. India's wholesale price inflation accelerated
to 12.94% year-on-year in May, versus 10.49% year-on-year in April, mainly due to a
spike in energy prices, government data showed. WPI inflation rate was -3.37 per
cent in May 2020, as global commodity prices nosedived. It also translated into a
higher retail inflation of 6.30 per cent in May-a six-month high. With this, the retail
inflation has breached the inflation target of 4+/-2 per cent set by the Reserve Bank
of India’s (RBI). CPI inflation rate was 4.23 per cent in April 2021. However,
wholesale food inflation moderated to 4.3 per cent in May.
The rise in inflation is different this time. The wholesale price index (WPI) shows that input prices have surged more than output prices. Some of the items that pushed retail inflation were fuel which recorded an inflation of 11.6 per cent (the highest since March 2021), transport and communication at 12.6 per cent, edible oil at 30.8 per and pulses at 9.3 per cent.
Comparison between WPI & CPI of India
WPI is mirrors of global commodity price hike
The wholesale inflation has been rising for five months, since January 2021, when it was up just 2 per cent, mirrors a global commodity price spike as described by the World Bank’s Commodity Markets Outlook brought out in April. With global production hit last year, low inventories have added to the price pressure. The global revival, backed by hefty stimulus packages, has created an inflationary ripple worldwide. Rising global crude oil and commodity prices are expected to push up WPI inflation further in coming months. With most developed countries opting
With most developed countries opting for monetary stimulus measures, global commodity prices are rising amid expectations of a global economic recovery. In India too, an ebbing of the second wave of the pandemic and increasing vaccination numbers have led to expectations of a recovery in demand. This has led producers to expect higher raw material prices in the coming months. This would cause the retail inflation to rise as well, putting the central bank on a tightrope walk in balancing the growth-inflation dynamics. While the RBI is unlikely to change its accommodative stance or the policy rate anytime soon, there is also pressure on the government for fiscal policy action to spur growth. Lower demand will be also major concern for RBI when rising retail inflation will dent the demand from end consumers.
The rupee fell sharply this week after the Federal Reserve released its policy statement, wherein it held rates unchanged but turned a little hawkish in its commentary, indicating the possibility of two rate hikes by 2023. Usually dollar lifted under hawkish regime. We think dollar has more to rise further against rupee as well towards 74.50. On the majors, sterling traded lower on broad US dollar strength. Comments from the Bank of England’s Chief Economist, Andy Haldane, stated that the local economy is close to pre-Covid output. While EURUSD broke below 1.20 hitting a low of 1.1936 a level not seen since April 13. The currency pair extended losses after comments from European Central Bank chief economist Philip Lane toned down the significance of a conversation around tapering for the central bank’s upcoming meeting in September. Going forward next week we think weakness in both euro and pound will remain focus in currency space.
USD/INR (JUN) contract closed at 74.2250 on 17-Jun-21. The contract made its high of 74.3350 on 17-Jun-21 and a low of 73.1500 on 14-Jun-21 (Weekly Basis). The 21-day Exponential Moving Average of the USD/INR is currently at 73.46.
On the daily chart, the USD/INR has Relative Strength Index (14-day) value of 64.93. One can buy at 74 for the target of 75 with the stop loss of 73.50.
GBP/INR (JUN) contract closed at 103.5100 on 17-Jun-21. The contract made its high of 103.70 on 16-Jun-21 and a low of 103.0850 on 17-Jun-21 (Weekly Basis). The 21-day Exponential Moving Average of the GBP/INR is currently at 103.53.
On the daily chart, GBP/INR has Relative Strength Index (14-day) value of 49.46. One can sell at 103.50 for a target of 102.50 with the stop loss of 104.00.
| 18th June | Bank of Japan (BoJ) stands firm on super easy policy, rates unchanged |
| 18th June | Rupee falls most in 2 months on US rate hike fears, breaches 74 |
| 17th June | Fed surprise may herald new era of Asian currency weakness |
| 17th June | Euro Pound (EUR/GBP) Exchange Rate Dips on Uncertain Outlook for Eurozone Economy |
| 17th June | Pound Canadian Dollar Exchange Rate Edges Higher as Strong US Dollar Undermines ‘Loonie’ |
| 16th June | Fed keeps zero-rate outlook, sees inflation bump as short-lived |
EUR/INR (JUN) contract closed at 88.5950 on 17-Jun-21. The contract made its high of 89.1925 on 15-Jun-21 and a low of 88.3050 on 17-Jun-21 (Weekly Basis). The 21-day Exponential Moving Average of the EUR/INR is currently at 89.12.
On the daily chart, EUR/INR has Relative Strength Index (14-day) value of 38.53. One can sell at 89.15 for a target of 87.15 with the stop loss of 89.65.
JPY/INR (JUN) contract closed at 67.0550 on 17-Jun-21. The contract made its high of 69.2650 on 17-Jun-21 and a low of 66.5775 on 15-Jun-21 (Weekly Basis). The 21-day Exponential Moving Average of the JPY/INR is currently at 67.03.
On the daily chart, JPY/INR has Relative Strength Index (14-day) value of 47.22. One can buy at 67 for a target of 68 with the stop loss of 66.50.
Agro-chemical manufacturer, India Pesticides will open its initial public offering for subscription on June 23, 2021. The price band for the offer has been fixed at Rs 290-296 per share. The issue will close on June 25. The company is planning to raise Rs 800 crore through its offer that comprises a fresh issue of Rs 100 crore and an offer for sale of Rs 281.4 crore by promoter Anand Swarup Agarwal and Rs 418.6 crore by other selling shareholders. The net proceeds from the fresh issue will be utilised for working capital requirements (Rs 80 crore), and general corporate purposes, while the offer for sale money will go to selling shareholders. Investors can bid for a minimum of 50 equity shares and in multiples of 50 equity shares thereafter. India Pesticides is an R&D-driven agro-chemical manufacturer of technicals with a growing formulations business. It is one of the fastest growing agro-chemicals company in terms of volume of technicals manufactured. The company has recorded 37.17 percent year-on year growth in technicals manufacturing (by volume) between FY20 and FY21, reaching more than 75 percent plant operating rate. It also manufactures herbicide, insecticide and fungicide formulations.
Religare Enterprises (REL) is considering an initial public offer (IPO) of up to ₹2,000 crore for its health insurance subsidiary Care Health Insurance, where it plans to issue fresh shares. Care Health could become the third from the health insurance segment to launch an IPO this year after Star Health Insurance and Medi Assist India. REL own around 70% stake in the firm while Kedara Capital has around 18% stake. Public sector banks including Union Bank and Corporation Bank hold around a 6% stake in the insurance company. Care Health, which posted a gross premium of ₹2,560 crore for FY21, offers products in the retail segment for health insurance, critical illness, personal accident, top-up coverage, international travel insurance, and maternity along with group health insurance and group personal accident insurance for corporates. The overall business of the company grew by 31% in FY20, even as the standalone health insurance industry recorded a growth rate of 21%. The company posted a profit after tax of ₹65.65 crore in FY20.
Edible oil firm Ruchi Soya, which is owned by Baba Ramdev-led Patanjali Ayurveda, has filed draft document with SEBI to launch a follow-on public offer (FPO) for raising up to Rs 4,300 crore. The FPO is being launched to meet the SEBI norm of minimum public shareholding of 25 per cent in a listed entity. Ruchi Soya filed the draft red herring prospectus (DRHP) with market regulator SEBI on Saturday, sources said, adding that the company plans to raise up to Rs 4,300 crore through the share sale. They said that the promoters have to dilute a minimum 9 per cent stake in this round of the FPO. The FPO is likely to hit the capital market next month after getting Sebi approval. In a regulatory filing, Ruchi Soya said that the issue committee constituted and authorised by its board has approved raising of funds by way of further public offer of equity shares of the company. The panel also approved the DRHP dated June 12, 2021, for filing with SEBI and two stock exchanges -- BSE Limited and National Stock Exchange of India Limited. Promoters group held 98.90 per cent stake in the company. As per the SEBI listing rules, the company needs to bring down promoters' stake to achieve the minimum public shareholding of 25 per cent in compliance with the listing requirement under the Securities Contract (Regulation) Rules, 1957. Ruchi Soya has three years to pare promoters' stake to 75 per cent. In 2019, Patanjali acquired Ruchi Soya, which is listed on stock exchanges, through an insolvency process for Rs 4,350 crore.
Supriya Lifescience has filed a draft red herring prospectus with Securities and Exchange Board of India to raise ₹ 1,200 crore through an initial public offering (IPO). The Mumbai-based bulk drugs company's IPO will consist of a fresh issue of ₹ 200 crore and an offer for sale of up to ₹ 1,000 crore by the promoter Satish Waman Wagh, as per the filing with the market regulator. The shares are likely to be listed on the BSE Sensex and NSE Nifty. Supriya Lifescience is one of the key Indian manufacturers and suppliers of active pharmaceutical ingredients (APIs). It has niche product offerings of 39 APIs focused on diverse therapeutic segments such as antihistamine, analgesic, anaesthetic, vitamin, anti-asthmatic and anti- allergics. ICICI Securities and Axis Capital are the book running lead managers, and Link Intime India is the registrar to the issue.
Auto component maker Sansera Engineering Ltd has filed preliminary papers with capital markets regulator Sebi to raise funds through an initial share-sale. The initial public offer (IPO) is entirely an offer for sale (OFS) of 17,244,328 equity shares by promoters and existing shareholders, draft red herring prospectus (DRHP) filed with Sebi showed. Those offering shares in the OFS are existing investors-- Client Ebene, CVCIGP II Employees Ebene and promoters -- S Sekhar Vasan, Unni Rajagopal K, F R Singhvi and D Devaraj. The company said it expects that listing of the equity shares will enhance its visibility and brand image and provide liquidity to shareholders. Also, the listing will provide a public market for the equity shares in the country. This is the company's second attempt to go public. Earlier, Sansera Engineering had filed IPO papers with Sebi in August 2018 and had also received its clearance to float the public issue. However, it did not go ahead with the launch. The Bengaluru-based firm is an engineering-led integrated manufacturer of complex and critical precision engineered components across automotive and non-automotive sectors. ICICI Securities , IIFL Securities and Nomura Financial Advisory and Securities (India) Private Limited have been appointed as merchant bankers to advise the company on the IPO.
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Motilal Oswal Asset Management Company Limited has announced split in the face value of each unit of Motilal Oswal NASDAQ 100 ETF from existing Rs 10 to revised Re 1. According the AMC, the ex-date and record date for the split is set as 17 June and 18 June respectively. The balance unit holding of the existing unit holders under the scheme as per records of the depositories as on 18th June will increase proportionately. However, this will not have any impact on the current value of holdings of the Unit holders of the scheme, the AMC said.
Investor interest in the mutual fund industry as an avenue to generate long term wealth creation is rising with SIP's asset base touching an all-time high of Rs 4.67 lakh crore at May-end. Over the past five years, the systematic investment plan or SIP AUM has grown 30 per cent annually, twice as fast as the growth in the overall mutual fund industry's assets under management (AUM). According to data released by Association of Mutual Funds in India (Amfi) on Wednesday, SIP AUMs have seen a close to four-fold jump to Rs 4,67,366 crore as of May this year from Rs 1,25,394 crore as of August 2016. The annual mutual fund SIP contribution too has seen a more than two-fold rise during the past five years to Rs 96,080 crore in 2020-21, from Rs 43,921 crore during 2016-17. Also, monthly SIP contribution has witnessed a healthy growth of 2.52 times to Rs 8,819 crore as of May 2021, compared to Rs 3,497 crore in August 2016. In the ongoing fiscal alone, for the first five months, SIPs have contributed Rs 42,148 crore. Retail Investor interest towards mutual fund (MF) asset class has seen a meteoric rise as SIP accounts during the last five-year jumped almost four times to 3.88 crore in May 2021, from 1 crore as of April 2016.
ICICI Prudential Mutual Fund has announced the launch of ICICI Prudential Flexicap Fund, a new open-ended equity scheme which will be investing in equity and equity related securities across market capitalization, based on an in-house market cap allocation model. The New Fund Offer (NFO) opens on June 28 and closes on July 12. According to the fund house, ICICI Prudential Flexicap Fund aims to follow a mix of top-down and bottom-up approach to identify opportunities in large, mid and small cap space respectively. The investment universe considered will be the S&P BSE 500. The stock selection can be based on multiple parameters such as company fundamentals, valuations, and so on. Minimum application amount (including switches) during NFO is Rs 5,000 (plus in multiple of Re. 1).
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