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FROM THE DESK OF EDITOR

The 16th anniversary of Wise Money is a momentous milestone, and it has been a privilege for me to be a part of it as an Editor. This anniversary demonstrates the growing interest in and recognition of the importance of sustainability of Wise Money. Thank you to all the readers, Wise Money team and Brand team who all made Wise Money a success.

At the outset, we continue with our positive outlook on both Indian economy and stock market as highlighted in our last annual issue. The ambitious target of becoming $ 5 trillion economy and significant policy changes, incentives to adopt new technologies with prime focus to become self-reliance auger well for the Indian economy. The recent economic data like high GDP growth rate, foreign exchange reserves, rising trend in GST collection along with improved corporate earnings and optimistic management comments suggest that the economy is in good shape. The balance sheet of the Indian corporates has become stronger with healthy cash position and reduced debt on the one hand, and on the other hand, books of both public and private banks have improved significantly to engineer future growth.

Geopolitical tension caused due to Ukraine-Russia war led to sharp rise in the crude oil price have raised the fear of inflationary pressure, which was already at elevated level caused to due supply chain issues. The central banks across, Fed in particular has initiated contractionary measures to bring inflation under control, which has surpassed longer term target of 2%. In the last meeting, it raised the rate by 0.25% to the range 0.25% to 0.50% and the same is likely to go up to the level of 2-2.25 percent over the next one year.

The continued accommodative stance by both government and RBI is expected to support the growth momentum in the long run with intermediate headwind due to global factors. In the recently held monetary policy, the RBI kept the rates unchanged to remain accommodative while focusing on withdrawal of accommodation given in the system at the time of pandemic to ensure that inflation remains within the target going forward. The chances of further inch up in inflation have risen after subsequent rise in pump prices, which were kept on hold for long when crude prices were rising. It looks now that the government is not considering rationalizing excise duty at this juncture in view of the some correction in crude prices along with the news coming that Russia is offering major discount on its crude.

On the market front, the Indian stock market has recovered strongly from the pandemic. Despite the turbulence in stock markets across the globe, India has achieved yet another milestone in market capitalization. It surpassed the United Kingdom for the first time to become the sixth largest in the world. Going forward, we remain positive on the market on the back of improving capacity utilization supported by improved demand. The capex

step of the user industries have started to pickup, which is getting reflected in the higher order books for the companies in the space of capital goods. It has also been observed that the consumption habit is also changing with likes for premium products getting traction. On these back drops, we expect growth momentum in sectors like financial, capital goods, real estate and infrastructure would continue for longer time frame.

On the commodity front, after making a strong rally, commodities are trapped in a range at present. On one hand, indications of more interest rate hike by Fed have strengthened dollar index and US treasury yield amid lockdown in China has pressurized the prices. On the other hand, ongoing war and fear of further sanctions has limited the downside of commodities prices as supply side is already tight in the middle of strong demand. Rising U.S. interest rates and higher yields increase the opportunity cost of holding bullion, which is also used as a hedge against rising inflation. Fed officials noted that one or more 50 bps increases in the target range could be appropriate at future meetings, the next one being in May, particularly if inflation pressures remained elevated or intensified. Gold and silver will trade in a range of 50250-54000 and 63000 – 69000 respectively. Activity in China's manufacturing and services sector contracted at the steepest pace in two years in March as the local surge in corona virus cases restricted mobility and weighed on client demand. It can give a pinch to the base metals prices. Crude can make lower base but has important support near $92 in NYMEX and 7000 in MCX. Inflation Rate and New Yuan Loans of China, GDP, Inflation Rate, Unemployment Rate, Core Inflation Rate and Inflation Rate of UK, Inflation Rate of Germany, ZEW Economic Sentiment Index of Euro Area and Germany, Core Inflation Rate, PPI, Retail Sales, Michigan Consumer Sentiment Prel and Inflation Rate of US, BoC Interest Rate Decision, Unemployment Rate of Australia, ECB Interest Rate Decision and ECB Press Conference etc are many strong triggers scheduled for this week, which will give significant direction to the commodities.

What has been the growth driver of the Brokerage industry? What type of new investors have you seen coming into the market?

The broking industry has posted a record performance in the recent fiscal. Recent dynamics in stock markets suggest that there is an emerging class of individual investors with distinctive motivations and behaviors. Actually, the Brokerage industry saw uptick driven by robust corporate earnings, favorable liquidity in both international and domestic markets, higher internet penetration, and retail participation. The Industry has been witnessing an upsurge in the number of investors willing to invest in stock market. To note, Indian investors opened a record 14.2 million new demat accounts in FY21, nearly three times the figure in the previous fiscal year, as the global Covid-19 pandemic and business disruptions opened up new investment opportunities.

Worldwide, young investors are shifting investing trends - and economies along with them. It could be seen that easy access to trading platforms, databases and research tools has made the stock market ecosystem favorable for Millennials and Generation Z. With unparalleled digital access to financial information, up-to-the-minute analytics driven by artificial intelligence and machine learning, young investors find it easy to identify the right investment opportunities. Besides, social media—YouTube influencers, Twitter, and Telegram stock-tipping chat groups—has attracted these generation. With access to sophisticated trading platforms, tailor-made suggestions and holistic financial planning at their disposal, these generations take quick decision.

A unparalleled disruption is taking place in the Brokerage Industry. How is SMC leveraging on and preparing for it?

The last few years have brought about a paradigm shift in the manner investors trade in the stock market. With financial savings rising and lowering interest rates, equity as an asset class will continue to remain attractive. Brokering industry has seen a lot of changes and transitions in past decade led by disruptions from discount brokers, buoyancy in equity markets, digitalization and increased interest among various investor groups. However there is still less than 5% penetration of Indian capital markets as compared to developed countries where it is 20%-50%. So, there is a lot of headroom for Indian capital market penetration to grow.

No doubt, discount broking firms have helped expand the market by bringing on board a large number of first-time investors; 60-70% participants are new entrants. With new age investors flocking to the stock market, traditional broking firms too are gearing up. But one thing is sure that sooner or later a lot of discount broking clients will come to a full-service broker because they will feel the need for a branch network and a relationship manager to

handhold them. To note, nearly 80% of the new clients are of less than 50 years of age, 50% of the clients are of less than 40 years. Even a growing number of women are now entering the stock market; it is good to see that the proportion of women investing in stock market has increased from about 16% to 25% across India in the past two years.

SMC has identified the major thrust areas that need focus in order to remain competitive in this dynamic environment; Technology and product development being in the forefront as they become the backbone of any organization. We are investing tremendously in select innovative products. We are successfully running a mobile trading app “SMC Ace”. We are also planning to launch another new mobile trading app to enhance the customer experience. Besides, SMC has already launched a web based Analytical Research Tool, Autotrender, which has been indigenously developed by our research and IT team. In addition to Autotrender, we are also focusing on our advanced research products which are open to all traders/investors. Our company has also introduced Algo trading platform to suit the needs of those clients who want to automate their strategies. SMC too has launched Stoxkart - a online discount broker providing one of the lowest brokerage structure.

The above initiatives will certainly go a long way and play an imperative role in improving their trading/investing performance. All in all, thanks to the initial lockdown in 2020, now around 50% of the overall clientage is coming from T3/T4 cities and 25% are coming from T2 cities. That means our investors base is gradually rising even though the penetration level might be well below the levels seen in developed countries. It’s still a large number and the only way we can cater to this rising population is through technological innovations. Here, we are fully aware that the technological disruption of the trading and investment business is here to stay.

Please walk with us through the new initiatives for business partners.

SMC offers one stop investment solutions in trading & investments, which provides a range of services to grow client’s wealth and protect what they have worked so hard to earn. Since inception, we have effectively leveraged technology to deliver our products, services, and class-leading experience to our ever expanding client base. To gain more visibility for our business associate’s business digitally, we created their digital profiles in the form of websites and SEO optimized them for hyper local searches over google search and google maps. This activity helped the businesses to engage with their customers by responding to their reviews, answer questions, etc. In our vast stock broking and investment experience, we have realized that processes and operations are the backbones of our business. SMC has made it robust in order to achieve optimum productivity and efficiency, ensure mitigation of risks, and minimise losses. With the SMC brand, the Company is transitioning into a new-age FinTech platform capable of enabling millennials from new age India to meet their financial dreams. SMC provide regular training program to our Business Partner on Client Acquisition, Risk Management System (RMS), Back Office Operations, Trading activities, Research software, in addition to providing wholesome knowledge of various products offered by SMC. A Business Partner can ride high with wide range of products available to diversify the income instead of solely depending on only Broking. Dedicated support staff for each product, effective lead management system, joint lead conversion activities and attractive commission structure keeps the motivation level high of the associate. Besides, SMC Global has done many a strategic alliance with different banks for offering online trading services to the bank customers. This tie-up offers an integrated 3-in-1 account comprising of a Savings, Demat and Trading account providing a hassle free and convenient trading experience to the bank customers through the portal www.smctradeonline.com apart from mobile trading app (SMC ACE) and desktop based software. Ultimately it helps SMC to increase its presence and client base across India. SMC has also launched Mobile eKYC application. The application helps SMC business partners to open paper less account in few minutes through Aadhar Based Esign. We’ll continue to onboard customers digitally, deliver the most cutting-edge solutions at the comfort of a mobile tap.

Electric vehicles are growing in India and various Government initiatives are also supporting but the main problems are lack of charging infrastructure, high initial cost and lack of electricity produced from renewable energy whereas Ethanol is already in the market through blending percentage in petrol. In January 2021, the target of achieving 20% ethanol- blending was pre-poned to 2025 from 2030. The blending of ethanol has increased to 9.45% in FY2021-2022 from 8.5% blending achieved in FY2020-2021. Thus, blending has increased by over 11% in the current financial year. Moreover, the recent press conference by Mr Gadkari to sugar companies “Jitna dum hai utna ethanol banao”…no dearth of demand. The country will require 1,016 crore litre of ethanol for blending in petrol in 2025 to fulfil the target of 20% ethanol blending and as per the report by the government on ‘Roadmap for Ethanol Blending in India 2020-25’, 50% of ethanol requirement will come from the sugar industry and rest from grain and other sources. However, electric vehicles can also run on electricity produced from fossil fuels, the overall efficiency of electric vehicles is still higher and the pollution is less because large thermal power plants are much more efficient and it is easier to control emissions from power plants than vehicles engines.

Then the question arises why we do not just focus on Electric vehicles? The answer is that a net positive contribution would require a long term change in energy supply infrastructure and if we assume that most of today’s electric cars may be powered by coal-produced electricity then it may beat the purpose. However, Infrastructure in many ways could be easier and more cost-effective to build for ethanol than for electric cars and filling stations can serve hundreds of users at one time. By contradiction, most users may charge electric cars at home and in line with that GM deliberately designed the Volt so that it could be charged with an ordinary household outlet. Meanwhile, the public charging networks needed to complement home charges which could be costly. Moreover, prices of commodity items used in manufacturing automobiles, including steel, aluminium, copper, zinc, rubber, platinum, palladium and rhodium, have become increasingly volatile in recent years. Semiconductor shortages have also impacted the auto industry adversely. Many major automotive companies have been experiencing a shortage of semiconductors, used in the production of automotive chips and charging or other components of electric vehicles.

FLEX FUEL ENGINES & ETHANOL PUMPS SOON: Flex engines by 4-wheelers will be ready in the next 6 months and 2-wheelers have already developed flex-fuel engines. Bajaj Auto is already ready with their flex enginedriven auto rickshaw models while the company along with TVS are already making use of flex engines in two-wheelers. Toyota, Suzuki and Hyundai have also announced that it would bring flex engines. According to Mr. Gadkari, the public will see more ethanol pumps in the future. Additionally, recently, PM has inaugurated three E100 ethanol dispensing stations in Pune under a pilot project. From auto rickshaws to high-end cars, all vehicles will be able to run on ethanol soon. Moreover he further said that the government will soon come up with an advisory on flex engines for automobile makers that will allow the manufacture of vehicles that would run both on petrol and 100% ethanol. Further, lot of research is also carrying towards ethanol usage for future green energy and it is believed that Ethanol would pave the way for more green energy. Bio-CNG & Hydrogen are the next big steps for green energy. BPCL is in the process of setting up three 2G Ethanol Bio-Refineries in the states of Orissa, Madhya Pradesh and Maharashtra. The Bio-Refineries are expected to produce Ethanol 100 KL per day using lignocellulose biomass as feedstock (rice straw/maize stalk) using indigenous technology. The 2G Ethanol produced, will be used for blending in Motor Spirit (Petrol).

Even though there are lots of hindrance to the availability of infrastructure related to electric vehicles various e-commerce companies, car manufacturers, app-based transportation network companies and mobility solution providers has already entered the sector and are slowly building up electric car capacity and visibility. In the financial year 2022, Tata Motors reported tremendous growth in their electric vehicle sales. As per data released by the homegrown automaker, Tata reported the highest-ever annual EV sales of 19,106 units in FY22, up by 353 per cent as compared to FY21. The Nexon EV is currently the most popular electric car in India, and also the single largest selling electric car. Tata is also planning to launch the updated Nexon EV soon with an extended range. Also, Tata Altroz EV is on the cards. The Government of India has encouraged foreign investment in the automobile sector and has allowed 100% foreign direct investment ("FDI") under the automatic route. Focus is now shifting to electric vehicles to reduce emissions. With the above availability of facts, EVs are not a threat to Ethanol and there is a HUGE demand for ethanol for the next many years. Both Electric Vehicles and Ethanol Vehicles would play a vital role in the growth of the auto industry simultaneously.

NEWS

COVID-19: the dust has not settled yet, there comes Russia Ukraine war. Investors look perplexed “Ab kya karein - Bazaar to samajh hi nahi aa raha”. Russia has launched an armed forces attack on Ukraine and the event has sent reactions across the world. Given uncertainty as to how the war would unfold and what counter-sanctions Russia might initiate, financial markets initially reacted harshly to the invasion. Bond yields in the United States and Europe fell, and the prices of oil and natural gas increased along with other commodities. While the war could exacerbate inflation, it could also weaken growth. Thus, central banks will have to choose which of the two scenarios is more important. But recently Fed was loud and clear that it would continue its tighter monetary policy. But for sure, for central banks across the globe that it will be a challenging balancing act.

A brilliant metaphorical framework for understanding the stock market can be summarized with the Benjamin Graham remark: In the Short-Run, the Market Is a Voting Machine- tallying up which firms are popular and unpopular, But in the Long-Run, the Market Is a Weighing Machineassessing the substance of a company. The message is clear: What matters in the long run is a company's actual underlying business performance and not the investing public's fickle opinion about its prospects in the short run.

Be patience and diversified

The saying “don’t put all your eggs in one basket” has some application to investing. A patient investor understands that markets fluctuate, and has built a portfolio based on his time horizon, risk tolerance, and goals. Diversification and patience are the right tactics in these times of VUCA (Volatility, uncertainty, complexity and ambiguity). The investment in equity markets is to identify growth stocks and keep invested for the long term. The benefit of long term investing in stock market is unparalleled,

provided that investments are made in fundamentally strong companies with a good business model, sound management and growth visibility. Staying invested in the market over the long term has historically paid off. It has the power of compounding your invested fund. Albert Einstein has rightly said “Compounding is the eighth wonder of the world. He who understands it earns it. He who doesn’t pays it”. Long term investment is more a test of the investor’s temper than his understanding. For longterm achievement in investing, strong temperament is as significant as knowledge of fundamental business and financial analysis.

The world is an unpredictable place and it impacts financial markets and stocks. It could be seen that over the last 25 years, stock market handled many undesirable actions such as 1929 Great Depression, Black Monday of 1987, the 2001 Dotcom bubble burst, the 2008 financial crisis, and during the 2020 COVID-19 pandemic. However, unlike prior crashes whose recoveries required years, the stock market rebounded back to its prepandemic peak by May of 2020. Now the Russia and Ukraine saga has brought volatility and fear among investors. History shows that market has had moved smartly thereafter. The companies with strong business models rewarded long term investors with handsome amount.

Investing Strategies for Uncertain Times

The recent correction in the market poses a difficult question for investors: what should I do? When situations of heightened uncertainty arise, the best defense is to be as well-informed as possible. Times of heightened uncertainty can lead to great opportunities for investors who position themselves to take advantage of it. Keep updated by following news that impacts markets and do homework on companies that you would like to invest. Making money from investing in the uncertainty times need patience, discipline, and, of course ample capital in liquid available to make opportunistic buying. Being able to keep on top of news and adjust your portfolio accordingly will help you to invest wisely during uncertain times.

• Remove all loss-making, fundamental weak companies that do not have a strong business model in portfolio since these companies will not see a price increase even when markets recover. The loss that you may have to book now will look very small when you look back later.
• Use the cash to add blue chip companies that you always wanted to invest in but found the valuations to be high. When the markets sell off even good companies see a significant price correction.

Conclusion

“Market me paise bante hai par dhairya chahiye”. Good investing involves deciding on a long-term strategy and sticking with it. The market always rewards companies that earn high returns on capital over a long period. The wealth a company creates-as measured by returns on capitalwill find its way to shareholders over the long term in the form of stock appreciation. Investors should add stocks in a staggered manner and at present the mantra says that focus on the domestic-oriented businesses as the growth of the Indian economy is intact so as the business of the strong fundamental companies.

INDIAN INDICES (% Change)

SECTORAL INDICES (% Change)

GLOBAL INDICES (% Change)

FII/FPI & DII ACTIVITY (In Rs. Crores)

BSE SENSEX TOP GAINERS & LOSERS (% Change)

NSE NIFTY TOP GAINERS & LOSERS (% Change)

Above calls are recommended with a time horizon of 8 to 10 months.

Berger Paints (I) Limited (BERGERPAINT)

The stock closed at Rs 734.60 on 08th April, 2022. It made a 52-week low at Rs 620.45 on 08th March, 2022 and a 52-week high of Rs. 872.95 on 22nd July, 2021. The 200 days Exponential Moving Average (DEMA) of the stock on the daily chart is currently at Rs 740.20.

Short term and medium term bias look positive for the stock as it is trading in uptrend since September, 2019. After healthy correction, the stock consolidated in narrow range and formed a “Continuation Triangle” on weekly charts, which is bullish in nature. Last week, the stock has given the pattern breakout along with high volumes and also has managed to close above the breakout levels. So, further upside is expected in the stock from current levels. Therefore, one can buy in the range of 723-728 levels for the upside target of 790-800 levels with SL below 680 levels.

GAIL (India) Limited (GAIL)

The stock closed at Rs 162.15 on 08th April, 2022. It made a 52-week low of Rs 125.20 on 20th December, 2021 and a 52- week high of Rs. 171.30 on 06th October, 2021. The 200 days Exponential Moving Average (DEMA) of the stock on the daily chart is currently at Rs 137.62.

As we can see on charts that stock is trading in higher highs and higher lows on charts which is considered to be bullish. Apart from this, the stock is forming an “Inverse Head and Shoulder” pattern on weekly charts and is likely to give the neckline breakout of pattern. So, follow up buying may continue for coming days. On the technical indicators front such as RSI and MACD, these are also suggesting buying for the stock. Therefore, one can buy in the range of 156-159 levels for the upside target of 185-190 levels with SL below 142 levels.

Above calls are recommended with a time horizon of 1-2 months

VWAP stands for Volume Weighted Average Price. The volume-weighted average price is a trading benchmark used by traders that gives the average price at which security has traded, throughout the day, based on both volume and price. As a technical tool, Volume Weighted Average Price (VWAP) is suitable mostly for day traders or intraday traders in general, due to its accuracy to spot exit-entry points in a shortterm timeframe.

Importance of VWAP

While trading in stock markets, it is always important to use the right indicators so that you can enter and exit at the right time and therefore gain handsome profits.

VWAP rightly tells you not just about the price movement but also the volumes. It is very important for a trader to get the best benefit from volume indicator as well. Not having appropriate information about the volume can often lead to false indications.

For example- An increase in the price but no increase in volume can often lead to false bullish signals and vice versa.

Let us now discuss importance of VWAP indicator specifically for intraday traders.-:

• It is an important indicator to have a timely idea about short term trend of market.
• It can further define the entry and exit points for a trader and help them in making profits with limited risk.
• Unlike moving average, VWAP talks about the volume as well. This is the reason for lesser false signals.
• It sets the benchmark for the traders about the average price of the security at a particular session and a particular day.

How to Use VWAP Indicator?

As a day trader, one has only few hours to trade in a market and VWAP can be a great tool for all intraday traders as it gives them the opportunity to identify the right entry and exit point. In a simple manner it’s always better to enter into a trade when price is near to the VWAP. This will reduce the risk in case of any failure. VWAP basically allows you to make an entry into a trade once a pullback is there after a breakout. The risk to reward automatically becomes favourable for a trader, which means loss incurred in each trade would be comparatively much less.

Let us understand how one can define the trend of particular asset class while looking at the VWAP indicator.

When the VWAP is below the market price, it is the right opportunity for thea traders to take a long position as the market sentiments are very bullish at the moment.

When the VWAP is above the market price, it is the right time for the traders to sell their stocks as the market at this time has bearish sentiments.

Conclusion

For people having the right mindset and a willingness to learn, stock market is a great place to be. There are lot of indicators that guides with the right trading decisions. And serve as the best friend while doing trading.

VWAP works moreover as a benchmark rather than an indicator and guides every intraday trader to make great profits. It is a perfect combination of price trends and volume for every trader who is looking for the right entry and exit point.

WEEKLY VIEW OF THE MARKET

Indian markets remained highly volatile in the week gone by, on the back of mixed cues from the domestic and global front. Nifty was seen trading in broader range of 18100 to 17600 while Bank nifty also remained volatile and witness see-saw moves in broader range of 38750 to 37350 levels. From the derivative front, call writers remained active at 17800 & 18000 strikes while put writers were seen adding open interest at 17700, 17600 & 17500 strikes. For upcoming week, we expect markets to remain volatile once again and could witness sideways moves at higher levels. For Bank nifty, 38200 levels could cap any sharp upside in prices while 37000 level is likely to provide support to index. As far nifty is concerned, 17850-17950 zone will act as a resistance for index while 17600-17500 zone could provide support on any dip. However, we expect that bias is likely to remain in favour of bulls and we may witness sector specific and stock specific moves in upcoming sessions. Implied volatility (IV) of calls closed at 17.68% while that for put options closed at 18.01. The Nifty VIX for the week closed at 19%, which was slightly lower than the previous week. PCR OI for the week closed at 1.42.

DERIVATIVE STRATEGIES

NIFTY OPTION OI CONCENTRATION (IN QTY) (MONTHLY)

CHANGE IN NIFTY OPTION OI (IN QTY) (MONTHLY)

BANKNIFTY OPTION OI CONCENTRATION (IN QTY) (MONTHLY)

CHANGE IN BANKNIFTY OPTION OI (IN QTY) (MONTHLY)

SENTIMENT INDICATOR (NIFTY)

SENTIMENT INDICATOR (BANKNIFTY)

FII’S ACTIVITY IN INDEX FUTURE

FII’s ACTIVITY IN DERIVATIVE SEGMENT

Top 10 Long Buildup

Bottom 10 Short Buildup

Note: All equity derivative data as on 7th April, 2022

**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

SPICES

Spices: Turmeric futures (May) closed higher for the third consecutive week to jump to 7-week high of over 10000 levels on improving domestic demand and diminishing arrivals in the physical market. The arrivals are normal as per the season. We expect the prices to trade higher towards 10500 levels with major support at 9120 levels. Currently, the prices are 20% higher as compared to last year due to improved demand for the new season turmeric. New season turmeric is hitting the market and the exports are currently peaking up. In the first 10-months (Apr-Jan) of FY 2021/22, exports were down by 20.1% at 1.27 lakh tonnes as compared to last year but higher by 9.2% as compared with 5- year average. As per first advance estimates by the Govt for 2021/22 season, turmeric output is pegged at 11.76 lakh tonnes in 2021-22 as against 11.24 lt in 2020-21. Jeera futures (May) closed lower after two weeks of uptrend this week due to profit booking at all-time high of 23495 levels. We have witnessed improving domestic demand from the spices industries. In coming week, it is likely to trade lower towards 21500 levels with resistance at 23260 levels due to some technical corrections. The physical arrival of old and new crop in Unjha is around 25000 bags (1 bag = 55 kg) daily compared to about 44000 bags last year. In 2022, jeera prices have jumped about 38% while prices are higher by 58.3% y/y due to lower crop estimates. As per the first advance estimates by govt, cumin seed output is at 7.25 lakh tonnes in 2021-22 against 7.95 lakh tonnes in 2020-21. Jeera exports during Apr-Jan period down by 23% Y/Y at 1.88 lt compared to 2.44 lt last year due to higher prices. Dhaniya futures (May) closing higher for the third successive week and touched 7 years high prices due to improving export demand. It is likely to trade in a range of 12050 - 13300 levels. Currently prices are higher by 75% y/y and up 42% since January on lower crop estimates while the exports are down. The spice companies waited price fall this year, but they see no reduction in prices and now started their purchase, which will support prices. The arrivals have improved in market as the prices touching multi year high. Arrivals have increased to over 70000 bags this week from less than 40000 bags last week. As per data release by Govt, coriander exports during FY 2021/22 (Apr-Jan) down by 15% at 41,100 tonnes compared to 48,350 tonnes last year but 11% higher compared to 5-year average.

BULLIONS

Gold prices rebounded from the support as concerns over rising costs and the Ukraine crisis bolstered its appeal as an inflation hedge and a safe haven, but the U.S. Federal Reserve’s aggressive policy stance limited gains. Once inflation starts to heat up again, it is going to work in favor of gold, even in the face of the aggressive Fed monetary policy. Minutes of the Fed’s March meeting showed deepening concern among policymakers that inflation had broadened through the economy, with “many” participants prepared to raise interest rates in hefty 50-basis-point increments in the next few meetings. Rising U.S. interest rates increase the opportunity cost of holding bullion while boosting the dollar. The dollar index slipped from a near two-year high, while benchmark U.S. 10-year Treasury yields also held close to a multi-year peak. Russia's central bank said that due to a "significant change in market conditions" it would buy gold from commercial banks at a negotiated price from April 8. On March 25, the bank had said it would buy gold at a fixed price of 5,000 roubles a gram until June 30. Since that announcement, the rouble has strengthened sharply against the dollar. Russia is one of the world's biggest gold producers, but the country's refiners were barred from selling bullion into the London market, the world's largest, after the Kremlin sent troops into Ukraine in February. Gold prices on the international market have remained stable at around $60 a gram, or $1,900 an ounce. Ahead in the week gold prices likely to trade in the wider range of 50400-52900, whereas silver may trade in the range of 64000-68500.

ENERGY COMPLEX

Crude Oil extended losses, amid uncertainty that the Euro zone will be able to effectively sanction Russian energy exports and after consuming nations announced a huge release of oil from emergency reserves. Prices were also pressured by fears that lockdowns in China due to a new wave of COVID-19 would slow the recovery in oil demand. Both benchmarks plunged more than 5% to their lowest closing levels since March 16. The European Union's top diplomat, Josep Borrell, told a NATO meeting that new EU measures, including a ban on Russian coal, could be passed on Thursday or Friday and the bloc would discuss an oil embargo next. However, the coal ban would take full effect from mid-August, a month later than initially planned. In China, multiple outbreaks of the virus have prompted widespread lockdowns in Shanghai, the most populous city. The demand situation in China is really not looking good, especially when we have so much new supply on the market. IEA member countries agreed to release 60 million barrels on top of a 180 millionbarrel release announced by the United States last week to help drive down fuel prices. Ahead in the week crude may trade in the range of 6800-7500 with bearish bias. Natural gas prices surged higher to fresh 13-year highs. Inventories unexpectedly declined. The weather is expected to be much colder than normal on the West Coast and colder than normal throughout the United States for the next two weeks. Natural gas arrivals at LNG export terminals rose after falling for 3-consecutive days. Ahead in the week prices may trade in the range of 460-510.

BASE METALS

Base metals may trade in the range with weak bias as demand worries rose after data showed service & factory activity in top metals consumer China slumped at the fastest pace in two years last month, hit by a COVID-19 resurgence and related restrictions. If dollar extends its rebound versus major peers after hawkish voices of the US Fed officials, it may weigh on counter. Fed officials said they were prepared to raise rates in half-percentage-point increments in coming policy meetings. However, metals prices may get support further as the risk of more sanctions on Russia may raise concerns over supply. Copper may trade in the range 790-840 levels. Treatment charges for spot copper concentrate in China could continue to rise in the second quarter amid easing supply. Zinc can move towards 362 levels with support of 340 levels. Lead can move in the range of 180-190 levels with firm bias. Rapid falls of metals in LME warehouses that underpin the exchange's physicallydeliverable futures contracts can result in price volatility. Of the 500 tonnes of zinc stored in LME warehouse in Europe, only 25 tonnes is available to the market. Aluminum may trade with bearish bias in the range of 265-285 levels. Lower crude prices and worries about growth and demand due to fresh lockdowns in China and higher interest rate environment may pressurize the Aluminum prices. The premium for aluminum shipments to Japanese buyers for April to June was set at $172 a tonne, down 2.8% from the previous quarter, as weak demand in Japan and China outweighed concerns of supply disruptions from Russia. Nickel may trade in the range of 2300-2600 levels.

OTHER COMMODITIES

Cotton futures (Apr) touched fresh all-time high of 44100 levels last week. We expect prices to trade in range of 42900 – 44100 with positive bias. Cotton prices have fallen in the global market, while domestic mandi has remained higher due to persistent demand from mills. Currently, the domestic prices are high 99.5% y/y and jumped about 29% in 2022 due to concerns over production, slow arrivals, better domestic and exports demand. According to market sources, domestic cotton arrivals down 25% or 88.95 lakh bales so far this season to around 238 lakh bales compared to last year. As per USDA report, all cotton planted area for coming season (2022) is estimated at 12.2 million acres, up 9 percent from last year. Guar seed futures (May) seen correction from higher levels as prices surged to 4-months high on export demand of guar gum from the country. We expect the prices to trade towards 7200 levels if it breaks resistance level of 6800. Support is at 6550 levels. Currently, prices are up 69% y/y on reports of lowest production in last 5 years, multi-year lower stocks and improving export demand due to higher crude oil prices. The oil rig count is also higher at 533 up by about 243 compared to last year. In Jan 2022, Guar gum exports are higher by 5% y/y at 22300 tonnes while exports in 2021/22 (Apr-Jan) are up by 38.4% y/y at 2.64 lakh tonnes. Castor Seed (May) witnessed huge correction of more than 6% last week at higher prices due to profit booking. We expect prices to trade lower towards 6600 levels with resistance at 7360. There is expectation of improving arrivals, as prices have been good this season. Prices have increased 18% this year due to lower production estimates and higher by 46% y/y due to good exports demand and limited arrivals. As per SEA, castor meal exports increase by 40% y/y to 32000 tonnes in Feb 2022, while overall exports for FY 2021/22 down about 5.5% to 3.60 lt vs 3.90 lt. Similarly, castor oil exports are higher by 7% m/m in Feb 2022 at 50,200 tonnes while it is at par at 6.1 lakh tonnes for Apr-Feb period. Mentha Oil (Apr) closed higher for 5th consecutive week due to higher demand and diminishing arrivals. Moreover, there is expectation of lower area in the coming season. The immediate resistance is 1152 levels and support is at 1095. The trend looks positive and likely to trade higher towards 1200 levels in coming weeks. The area under mentha expected to be lower this season in Uttar Pradesh while exports and demand is rising over the years.

The aftershocks of the COVID-19 pandemic continue to rock the global economy. The year 2021 ushered in a new era of prices for two historically significant assets—gold and oil. Both Gold and Crude Oil, the world’s most strategic commodities, witnessed a huge attention from the investors. The precious metal has proven its importance as an investment when the global politics and economy is going through a crisis. While crude oil prices have since risen sharply to nearly $100 per barrel following strong economic recovery postlockdowns. Moreover, rising geopolitical tensions between Russia and Ukraine and in the Middle East are stoking supply fears. This is contributing to rising inflation and concerns about economic recovery.

The Gold and Crude Oil ratio has now been shorten. The ratio clearly defines the correlation between both commodities and gives us an idea about how many barrels of crude we buy with one ounce of gold at any given time. A higher ratio indicates that either the oil prices are much cheaper or the Gold price is much more expensive, which means one ounce of gold can buy more oil. It is also recognized as a volatility measure that is driven by political or economic events. Both the commodities are dollar-denominated and strongly interlinked that is why the gold-crude ratio is considered an important indicator for the global economy’s health.

Another significant link between both commodities is inflation because the rise in energy prices will impact inflation and on the flip side, gold is considered as a hedge against inflation. It tells us that higher energy prices will lead to an increase in inflation and the gold prices will go up as more investor will park their money to diversify their portfolio from inflation-losing assets like cash and bond market. Addition to this, hedgers and spread traders will also pay more attention to ratio analysis to create opportunities.

As we are aware that both the commodities belong to different asset classes with their own fundamentals, they possess unique demand-supply constraints. Irrespective of these odds both also have some interesting similarities which are already mentioned above in the case of inflation and geopolitics.

Above mention chart illustrate the Gold versus Oil Correlation; from the chart it is very much clear that we have witnessed huge volatility in past 30 years.

From 1992 to 2002 the average of Gold-Crude ratio stood at 17.00 and the median at 16.93. This means we can buy an average of 17 barrels of crude with one ounce of Gold. From 2002-to 2012 the ratio stood at 11.19 and the median at 11.16. Over the past two years, the ratio stood at 24.47 and the median for the same period stood at 23.23. The ratio has hit a low of 12.12 in 2014 and a high of 89.92 in 2020 and presently it reads at 19.85. Clearly, there’s a significant range here, but unlike the way gold or oil trades against the US Dollar, this chart shows repeated reversions to the mean. Presently the Average at the time of writing reads at $17.81 and WTI Crude is trading at $112.10 which means that gold should cost around $1996.00 an ounce, rather than $1928 which currently trades at. This means that gold is undervalued at present and one should take benefit of the situation. Based on the analysis of 30 years charts it is identified that the ratio may trade in

the range of $12-$30. In my analysis with the help of this ratio, one can identify the fair value of either commodity which further helps us in making a good investment decision. With reference to my previous article on the Gold-crude ratio which is published in the previous "Wise Money" issue, I advised that one should book some profits in yellow metal around $1700 and try to make fresh positions in Crude around $61.00.

Rationale behind the crude and gold movement

The uncertainties presented by the COVID-19 crisis have had a profound impact on normal ways of life, economies, and financial markets around the world. What happened in crude oil was unbelievable but it has already given hints in the ratio analysis. In the year 2021 prices have given a return of over 77% and in the first 3 months of 2020, it has already rallied above 73%. The global oil market had already tightened significantly prior to the invasion after economies rebounded strongly from the pandemic, and the disruption to Russian exports has the potential to drive crude prices even higher. Governments around the globe are facing inflationary pressure as in Jan’2022 US posted CPI, its biggest 12-month increase since February 1982. Prior to the conflict in Ukraine, inflation was expected to peak in April 2022. This event just acts as a catalyst. On the other hand, gold acts as a hedge against inflation, and also the safe-haven buying has witnessed in the commodity. Alternatively, the Treasuries are also considered to be safe-haven assets and are negatively correlated with gold prices. As we have witnessed the recent sell-off in Gold prices is mainly derived from rising US 10 year bond yields. Rising bond yields signaled that investors are optimistic about economic growth in the future. Hence we can say that crude is overvalued and gold is undervalued. We must book some profit in crude oil around $110 and try to take positions in gold around $1925 and diversify the portfolio.

TREND SHEET

TECHNICAL RECOMMENDATIONS

NEWS DIGEST

• India reported record merchandise exports of $418 billion in just-concluded financial year 2021-22.
• The total wheat export stood at 70.30 lakh tonnes till March 21 this fiscal, with maximum shipments to Bangladesh followed by Sri Lanka and UAE.
• As per ISMA, sugar production reached 309.87 lakh tonne until March of the ongoing 2021-22 MY, higher compared to 278.71 lakh tonne last year, while exports may 85 lakh tonne in the ongoing 2021-22 MY ending September.
• India’s exports of agricultural products, including marine and plantation products, for 2021-22 hit a record at $50 billion. That was up 20% on year.
• As per the State Chilean Copper Commission (Cochilco), Chile's copper production fell 7.5% in February to 394,700 tonnes.
• As per the Andean country's central bank, Chile, the world's top copper producer, saw exports of the red metal reach $4.95 billion in March.
• Indian Energy Exchange (IEX) clocked a 38% growth in trade volume at 1,02,035 million units in financial year 2021-22.
• The Perth Mint shipped 121,997 troy ounces (oz) of physical gold products worldwide in March, a 68% lift on the previous month’s figure of 72,651oz.
• India’s import bill for edible oils is slated to jump by $2 billion, following the sharp rise in prices after Russian attack on Ukraine.
• India’s Bharat Petroleum Corp Ltd has bought 2 million barrels of Russian Urals for May loading from trader Trafigura.

NCDEX TOP GAINERS & LOSERS (% Change)

MCX TOP GAINERS & LOSERS (% Change)

WEEKLY STOCK POSITIONS IN WAREHOUSE (NCDEX)

WEEKLY STOCK POSITIONS IN WAREHOUSE (MCX)

The Russia-Ukraine war has created a new set of divergence in the forex space notably between commodity linked currencies and equity linked currencies. The European currencies most immediately exposed to the war and its economic fallout have fallen against the US dollar, while most commodity currencies have strengthened as commodity prices continue to surge. Since the invasion began on 24th February, the European currencies suffered significant fall against the dollar. The notable exception was the Swiss franc, it has benefited from safe-haven demand, despite being a net importer of commodities. The commodity-linked forex pack, the aussie and kiwi held up best, but the Canadian dollar and Norwegian krone still fell against the greenback despite the sharp rise in oil prices. On the emerging currencies pack, Rupee was the biggest loser dropping to new life time low to 76.96 amid substantial surge in Brent oil to $139. On the contrary, commodity currencies in Latin America appreciated while the CEE currencies (Central & Eastern Europe) suffered sharp falls and the ruble fell an astonishing by 26% after sanctions on its central banks left Russia without access to much of its FX reserves.

Inevitably the war between Russia and Ukraine has created imbalances for various central bankers for providing rate guidance which we have seen in latest FOMC’s 25 bps hawkish hike. Interestingly dollar’s subdued reaction after the FOMC rate hike implied that the rising volatility will continue across major economies to chase for an additional rate hikes this year to be discounted by markets which may prove to be a headwind for the dollar in the short term. However, the long term projection will be supportive for dollar as well. The key driver for the dollar will be Fed’s increasingly hawkish stance in response to a robust economic recovery and surging inflation pressures in the US.

We expect that the Fed will raise at least six quarter percentage rate hikes in 2022 and a significantly more aggressive pace of quantitative tightening than in the previous tightening cycle. On the contrary, we think many other central banks will lag behind the pace of extent of monetary tightening that markets now appear to expect which implies that rate differentials will continue to shift in favor of the dollar. Historically tighten financial conditions remained backdrop for dollar; tightening financial conditions implied majorly money market dealer funding. Usually higher financial tightening conditions led to cap in higher dollar. At present the tightening conditions in US is yet to pick-up apart from conventional rate hikes. but as the latest relative comparison showed in the below chart shows that financial conditions in the US is yet to tighten which can give more room for dollar to rise versus developed and emerging currencies including rupee as well in coming months

Key FX observations:

3M Carry - Implied yield of 3M forwards vs USD

1 Y Change - % changes vs USD, aimed to gauge momentum and meanreversion (1 year)

Implied Volatility - 3M at-the-money option-implied volatility (annualized)

Risk- Reversal - Difference between implied volatility of 3M 25-delta put and call options.

**Correlation between changes in currency unit per US dollar and the variable listed in the top row: A positive value means a rise in the variable in the top row is associated with a rise in the currency against the US dollar, and a negative value means that it is associated with a fall in the currency against the US dollar. EUR, CNY, and JPY in the top row refer to a change.

Key FX Outlook:

The curve inverts when yields on short-term treasuries rises above longer- term treasuries. A yield curve represents the different interest rates that are offer to investor who own bonds, for longer holding on bond you will be rewarded more. For example, investors of the 30 year treasury are paid more than Investors of a 2- year treasury. This is because the more time money sits in a bond, the higher the risk of the investment failing and therefore one is compensated for allowing that risk.

Globally, the most actively traded bonds are the U.S 10-year bond and U.S 2- Year bond and therefore we will use these bonds to understand the relation. Moreover, our stock market too has got affected by the trend in the U.S market and its economy. Many investors use the spread between the yields on 10-year and 2-year U.S. Treasury bonds as yield curve proxy and a relatively reliable leading indicator of recession in recent decades.

The spread between 2 and 10 year bond yields has long been regarded as a great indicator of prospect economy health, and as a phenomenon that can limit the Federal Reserve’s freedom of action. Usually, 10- year bonds will command a higher yield, for the sensible reason that more risk is involved in investing further into the future, and investors require a higher return to compensate for it.

In 1998, the 10-year and 2-year spread briefly inverted after the Russian debt default. Quick interest rate cuts by the Federal Reserve helped avert a U.S. recession. In 2006, the spread inverted for much of the year. Long-term Treasury bonds went on to outperform stocks during 2007. The Great Recession began in December 2007. On August 2019, the 10-year/2-year spread briefly went negative. The U.S. economy suffered a two-month Mr. Tapish Pandey Sr. Research Analyst Currency ANALYST CORNER recession in February and March 2020 amid the outbreak of the COVID-19 pandemic.

Recently the 2-year and 10-year Treasury yields inverted for the first time since 2019 as Yields of short-term U.S. government debt have been rising quickly this year, reflecting expectations of a series of rate hikes by the U.S. Federal Reserve, while longer-dated government bond yields have moved at a slower pace amid concerns policy tightening may hurt the economy.

However, there is nothing about bond pricing that directly triggers a recession. For example, the first recession warning ahead of the 2020 downturn arrived in the form of a yield curve inversion in August 2019. But financial markets could not have known a global pandemic would be the reason for that recession. In the face of rapid inflation, the Federal Reserve is in the process of hiking interest rates at its fastest pace since 1994. Bond markets have to quickly reprise through this policy pivot, meaning that inversions could be a temporary side effect of the Fed’s actions.

Historically yield curve inversion does not bring big chaos amongst investors. However market participants do follow a close watch on key economic indicators including the growth projections as well as inflation trajectory. Indeed if inflation remains under check with modest growth projection may not bring any fear factors for investors despite yield curve is getting inverted.

Introduction

SLB or Securities Lending and Borrowing are a sophisticated mechanism through which market participants lend or borrow shares within each other for a stipulated time period. Typically, ‘Borrowers’ are traders who look to ‘Short’ their shares; and ‘Lenders’ are long term investors who lend their shares to earn a certain fee.

To elucidate on this further, the investors lend their shares to the traders or arbitrageurs in return for an interest on the lent shares. The interest rate varies from stock to stock and also on the tenure of borrowing. Market conditions too contribute to the mentioned factors. Think of it as a bank where the lending and borrowing happens between two participants under the control of an exchange. Generally, the ‘lenders’ here are long term investors such as big Insurance firms, Mutual Funds and HNIs or select retailer . According to SEBI guidelines, stocks can be borrowed for a minimum of 1 month and maximum period of 12 months. After the contract expires, the borrower gives back the borrowed shares to the lender with the interest or lending fee applicable in accordance with the above attributes. The SLB platform serves as a viable alternative to derivates market for the purpose of speculation.

Overview

Short selling means the selling of a stock that the seller does not own at the time of trade. The Securities Lending and Borrowing mechanism allows short sellers to borrow securities for delivery from the lenders. This convenient system for lending and borrowing has been in India since May 1997 when SEBI introduced it and now, transactions are carried out under the NSCCL (National Securities Clearing Corporation Limited) thus it does not carry any counter party risk i.e., there is no risk of losing the lent shares and undue risks such as defaulting. A point to remember here is that when a stock is loaned out, then the ownership too is transferred to the borrower temporarily. In India, all market participants including are entitled to the SLB medium except for Qualified Foreign Investors.

Trading Process

The trading mechanism is quite similar to our regular style of trading which involve proper order matching between the borrower, who quotes the lending fees for a specified qty of shares, and the lender who accepts the offer given by the borrower. Lending fees is quoted on per share basis like Rs. 0.50/ Share, which can vary depending upon the type of share been offered and demand for that share.

The parameters for SLBS are as follows:-

The whole process is supported by margining system, so as to ensure no borrower defaults, where the borrower is asked to pay total contract value (100%) and an additional VAR margin which varies on the type of stock (Say Reliance has a VAR margin of 15.34%), so if borrower wants to borrow Reliance under SLBS then he needs to deposit 115.34% margin plus lending fees. The same way lender will also needs to pay VAR margin till the time the shares are not transferred from his account to borrowers account.

Daily MTM is also recorded so as to manage wide fluctuation in share prices and finally at the end of contract, lender gets back the stock and borrower margin is released.

Adjustment of corporate action

All the corporate actions benefits stays with the lender and if any dividend is received by borrower on behalf of the lender must be compulsorily transferred to lender through exchange mechanism.

Benefits for Lenders

• A good source of income for those who want to make the most of their idle portfolio. By lending their shares held for the long term, they can earn an additional income from time to time.
• There is no cap or limitation on the minimum quantity to lend.
• Lenders are entitled to all the corporate actions like dividends, bonuses, stock splits, etc. taken during the lending period.
• There is no counter party or defaulting risk as the transactions are overlooked and guaranteed by the Clearing Corporation.
• Transactions done in the SLB segment will not be treated as a normal buy/ sell order and hence most of their taxes and rules are exempt in this process.

Benefits for Borrowers

• Arbitrage/ Speculation opportunity in the case of price difference in the cash and derivative market.
• Participants can take benefit of expected downward price movement at controlled risk which provide excellent risk/reward ratio compared to derivative segment.
• Enables to meet the obligations to cover short position, to avoid settlement failure and other Future and Options strategies which require stocks.
• Borrower can borrow the shares from lenders at a discounted rate and can make a profit on it.

Conclusion

Currently, all stocks trading on exchange platform which meet the liquidity and other regulatory criteria are eligible for lending and borrowing under the SBL mechanism. In case if a borrower wants an early repayment or the lender wants an early recall, they can request their brokers to do so. The borrowers can place an early request with the fees they are willing to receive and the lender would place an early recall request with the fees they are willing to pay. Another interesting process which is followed is that the borrowers these days get the securities with a day. Hence the SLB mechanism ensures the smooth lending and borrowing of shares so that trades can be carried out efficiently as well as effectively ensuring the avoidance of any undue risks or defaults faced by the market participants.

IPO NEWS

Uma Exports debuts at Rs 80, a 17% premium over issue price

Agricultural produce and commodities trader Uma Exports had a good debut as the stock listed with a premium of 17.65 percent over issue price. It listed in a trade-for-trade segment, where the stock has a 5 percent circuit on either side compared to opening price. "The scrip will be in Trade-for-Trade segment for 10 trading days," said the exchange in its circular. Uma exports has garnered Rs 60 crore through its public issue which will be utilised for working capital requirements. The offer, which was subscribed 7.67 times during March 28-30, had a price band of Rs 65-68 per share.

DCX Systems files draft papers for Rs 600-cr IPO

DCX Systems, a leading player for the manufacture of electronic sub-systems and cable harnesses, has filed preliminary papers with capital markets regulator Sebi to raise up to Rs 600 crore through an initial public offering (IPO). The public issue comprises fresh issue of equity shares, aggregating up to Rs 500 crore, and an offer for sale of equity shares to the tune of up to Rs 100 crore by promoters -- NCBG Holdings Inc and VNG Technology, according to the Draft Red Herring Prospectus (DRHP). The company proposes to utilise the net proceeds from the fresh issue towards debt payment, funding working capital requirements, investment in its wholly-owned subsidiary Raneal Advanced Systems to fund its capital expenditure expenses and general corporate purposes. The Bengalurubased company is primarily engaged in system integration and manufacturing a comprehensive array of cables and wire harness assemblies, and are also involved in kitting. DCX Systems' revenue from operations grew at a CAGR of 46.22 per cent from Rs 299.87 crore in fiscal 2019 to Rs 641.16 crore in fiscal 2021, and revenue from operations was at Rs 728.23 crore in nine months ended December 31, 2021. The company's order book has increased from Rs 1,042.30 crore as of March 31, 2019 to Rs 2,855.01 crore as of March 31, 2021.

Dharmaj Crop Guard, Venus Pipes & Tubes get Sebi nod to float IPOs

Agro chemical manufacturer Dharmaj Crop Guard and steel pipe maker Venus Pipes & Tubes have received regulatory approvals to raise funds through initial public offerings (IPOs). he companies that had filed their preliminary IPO papers with Sebi between December 2021 and January 2022 obtained its "observation" letter on March 29-31. According to the Draft Red Herring Prospectus (DRHP), Dharmaj Crop Guard's IPO consists of fresh issue of equity shares worth up to Rs 216 crore and an offer-for-sale (OFS) of up to 14.83 lakh shares by its existing shareholders. Proceeds from the IPO will be used for capital expenditure towards setting up of a manufacturing facility at Saykha Bharuch in Gujarat, incremental working capital requirements, payment of debt and general corporate purposes, the draft paper said. Venus Pipes & Tubes said that 50.74 lakh equity shares of the company will be sold through IPO. Proceeds from the IPO will be used for financing capacity expansion and backward integration for manufacturing of hollow pipes, to meet working capital requirements and for general corporate purposes, it's draft paper said. Venus Pipes & Tubes is one of the growing stainless steel pipes and tubes manufacturers and exporters.

General Atlantic-backed KFin Tech files draft paper for Rs 2,400 crore-IPO

KFin Technologies, which is one of the leading registrars in India, has filed its draft red herring prospectus with the market regulator Sebi to raise Rs 2,400 crore via an initial public offering. The IPO is entirely an offer for sale (OFS) of up to Rs 2,400 crore worth of equity shares by General Atlantic Singapore Fund Pte. Ltd. KFin Technologies is majority owned by funds managed by General Atlantic, a leading global private equity investor, which holds a stake of 74.94 per cent. Kotak Mahindra Bank acquired a 9.98 per cent stake in KFin Technologies in 2021. KFin provides services to asset managers and corporate issuers across asset classes in India and also provides solutions including transaction originating and processing for mutual funds and private retirement schemes in Malaysia, Philippines and Hong Kong. KFin Technologies is India’s largest investor solutions provider to Indian mutual funds, based on the number of AMC clients serviced as on January 31, 2022. The firm provides services to 25 out of 42 AMCs in India representing 60 per cent of market share based on the number of AMC clients. The firm has also signed two new AMCs that are yet to launch operations.

IPO TRACKER

INDUSTRY & FUND UPDATE

Invesco Mutual Fund launches Invesco EQQQ Nasdaq-100 ETF Fund of Fund

Invesco Mutual Fund has launched a new fund, Invesco EQQQ Nasdaq-100 ETF Fund of Fund, an open-ended fund of fund scheme investing in Invesco EQQQ Nasdaq-100 UCITS ETF. The fund will invest 95% of its net assets in the Invesco EQQQ Nasdaq UCITS ETF fund, which tracks the Nasdaq 100 index. The New Fund Offer (NFO) is now open and will close for subscription on April 13. The underlying fund is domiciled out of Ireland and has a track record of over 19 years. The fund has assets under management of over Rs. 45,873 crore (US$6.09 bn) as on 28 February 2022. According to the fund house, the scheme will provide exposure to 100 largest US and international non-financial companies listed on the Nasdaq Stock Market based on market capitalization. The minimum investment amount during the NFO is Rs 1,000 and in multiples of Rs 1 thereafter. For SIP investments, the minimum application amount is Rs 500 and in multiples of Re 1 thereafter. The fund will not charge any exit load on redemptions.

UTI Mutual Fund launches Nifty Midcap 150 Quality 50 Index Fund

UTI Mutual Fund has launched an open-ended scheme replicating Nifty Midcap 150 Quality 50 Total Return Index (TRI) - UTI Nifty Midcap 150 Quality 50 Index Fund. The New Fund Offer is open and will close for subscription on April 5. The scheme will re-open for subscription and redemption on an ongoing basis from April 15. According to the press release, the investment objective of the scheme is to provide returns that, before expenses, closely correspond to the total returns of the securities as represented by the underlying index, subject to tracking error. Sharwan Kumar Goyal, Head - Passive, Arbitrage & Quant Strategies, UTI AMC, will manage the scheme. Minimum initial investment is Rs 5,000/- and in multiples of Re 1 thereafter. Subsequent minimum investment under a folio is Rs 1,000 and in multiples of Re 1 thereafter with no upper limit. There is no entry or exit load in the scheme.

Index Funds AUM grew by 590%, ETFs by 117% since 2020

Passive investing has gained popularity since Covid hit the Indian shores two years ago. Since February 2020, the number of index funds have increased 144% and the assets managed by them grew 590%, says data collated by Morningstar India. Index funds have been the talk of the town in the last one year. There were 32 index funds in the market in February 2020. The number today stands at 78. The total AUM in index funds stood at Rs 7,930.48 in February, 2020. In February 2022 the figure was Rs 54,737.46. ETFs other than gold ETFs also saw investor interest in the recent years. There was a sharp increase of 57% in the number of schemes and 117% increase in the AUM of these ETFs. ETFs have been getting traction because of their low cost structures and innovative themes. However, data shows that retail investors still prefer index funds for their simplicity.

SBI Mutual Fund records monthly average flow of Rs 1800 crore in SIPs

SBI Mutual Fund, the largest fund house in the country by assets under management, registered more than 30 lakh new SIPs in FY 21-22 as on January 1, 2022, recording a growth of 39% as compared to the previous year. The fund house received an average monthly SIP flow of over Rs. 1,800 crore in the current financial year with the average ticket size of a SIP being around Rs. 2,500. The fund house attributes the growth in the new SIPs to availability of its offerings through a strong distribution network of IFAs, National Distributors and SBI Branches. SBI Mutual Fund also has further increased its footprint in the country with the opening of new branches in several Tier 2 locations. SBI Mutual Fund commands a 19.7% market share in B30 locations, seeing a growth of 37% in active SIPs.

NEW FUND OFFER

EQUITY (Diversified)

TAX FUND

BALANCED

INCOME FUND