In the week gone by, global stock markets witnessed volatile movements after better-than-expected jobs data increased investors’ anxiety around the state of the economy and path of interest rates. Even the 2-year Treasury yield reached as high as 5.113%, touching its highest level since June 2007, as investors bet that the Fed will keep tightening the economy for longer than expected. This comes after the U.S. Federal Reserve's minutes showed that a united central bank agreed to hold rates steady at the June meeting to buy time and assess need for further rate hikes. At the June 13-14 meeting, the Federal Open Market Committee (FOMC) voted unanimously to pause interest rate hikes after 10 consecutive increases, giving policymakers more time to assess the impact of rate hikes and recent banking stresses on the US economy. European market also slumped to their lowest level in three months, as heightened concerns about further interest rate hikes globally dented risk sentiment. On the data front, PMI figures for the euro zone showed that business output shrunk last month. Earlier this week, Services activity in China expanded at the slowest pace in five months in June, while factory activity declined for a third straight month in June.
Back at home, Indian stock markets scaled fresh highs on the back of strong corporate earnings expectation and a steady monsoon helped shake off fears of further monetary policy tightening by the U.S. Federal Reserve. Unabated FPI inflows are also continuously pushing markets higher as India is in a sweet spot versus global peers on the back of solid macro and improving micro environment. Auto retail sales in June 2023 reported a 10% y-o-y growth owing to positive performances across all vehicle categories including two wheelers, three wheelers, passenger vehicles (PVs), tractors, and commercial vehicles (CV) at growth rates of 7%, 75%, 5%, 41%, and 0.5% respectively, according FADA. Going forward, market will continue to move uptrend to continue with stock-specific action. The outlook remains optimistic backed by solid macros, softening oil and commodity prices, moderating inflation and robust fiscals.
On the commodity market front, CRB witnessed a pause in the fall and appreciated marginally despite the weak data. Dollar index zoomed up for continuous third week. Gold witnessed a pause whereas silver moved up for second week. Consistent draws in U.S. inventories have boosted hopes that U.S. oil demand is increasing amid the travel-heavy summer season. But somewhat mixed readings on gasoline stockpiles - which is the top fuel product in the country - have capped the upside. Crude prices are still trading down about 10% for the year. Crude oil is likely to trade in a range of 5800-6200 levels. Despite worsening economic conditions, investors have largely pivoted to the dollar as a preferred safe haven amid growing expectations that the Fed will keep raising interest rates in the coming months. Hence expect a range trading in bullion. Gold and silver can trade in a range of 57500-6000 levels and 68500- 72500 levels respectively. Inflation Rate of China and Germany, Unemployment Rate of UK, New Yuan Loans of China, ZEW Economic Sentiment Index of Germany and Euro Area, Core Inflation Rate, Producer Price Inflation Michigen Consumer Sentiment Prel and Inflation Rate of US, BoC Interest Rate Decision etc are loads of data and events scheduled this week, which will give much needed directions 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.
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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.
The company has integrated nature of operations with diversified product profile. It has a strong track record of growth and profitability. The recent capacity addition and value addition in the garment business auger well for the company. Moreover, Government has an ambitious target of taking textile and apparel (T&A) exports to US$ 100bn in FY28 and taking encouraging efforts for promoting and supporting the textiles sector such as Free Trade Agreements (FTA), Production Linked Incentive (PLI) scheme etc, which would benefit to the company. Thus, it is expected that the stock will see a price target of Rs.762 in 8 to 10 months’ time frame on current P/BV of 5.85x and FY24 BVPS of Rs.130.24.
The company is well-positioned to benefit from the growth of the Indian economy and the government's focus on infrastructure development. The company has strong track record and reupted client base consisting of major Government organisation and PSUs. The company's strong order book and product portfolio position it well for growth in the coming years. Thus, it is expected that the stock will see a price target of Rs. 1868 in 8 to 10 months’ time frame on target P/BVx of 3x and FY24 BVPS of Rs.622.70E.
The stock closed at Rs.1156 on 07th July, 2023. It made a 52- week low of Rs.965.05 on 15th July, 2022 and a 52-week high of Rs.1184.95 on 05thJuly, 2023. The 200 days Exponential Moving Average (DEMA) of the stock on the daily chart is currently at Rs. 1092.
The stock has formed a Double Bottom pattern on daily charts around 980 levels and has showed steep recovery thereon to once again, reclaimed a momentum above its 200 days exponential moving average on daily charts. Prices can be seen recovering in a rising channel with formation of higher bottom pattern. The stock has given a fresh breakout above the key resistance level of 1150 after a series of prolong consolidation phase. On the short term charts, fresh breakout has been observed above the symmetrical triangle pattern as well. We expect that the momentum is likely to carry towards higher levels, after a breakout, as rising volumes suggests strength in a current trend. Therefore, one can buy the stock in the range of 1150-1160 levels for the upside target of 1320-1335 levels with SL below 1050 levels.
The stock closed at Rs.1020.65 on 07th July, 2023. It made a 52- week low at Rs.763.10 on 06th July, 2022 and a 52-week high of Rs.1088.95 on 15th September, 2022. The 200 days Exponential Moving Average (DEMA) of the stock on the daily chart is currently at Rs. 911.
The Stock has been maintaining its bullish moves since last thee months as prices can be seen trading in a rising channel with formation of higher bottom pattern on the daily and weekly charts. The rising volumes along with rise in price suggests a long build up into the stock, while positive divergences on secondary oscillators suggests continuation of current trend. On the short term charts, prices can be seen maintaining well above its short and long term moving averages as well. Therefore, one can buy the stock in range of 1010-1020 levels for the upside target of 1140-1145 levels with SL below 930 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.
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Indian markets started the week on a positive note and made record highs during the week, as bulls continued to rule over the markets, while taking cues from the strong global and domestic factors. Nifty made record high of 19523 while Bank nifty marked record high of 45655 in past week. However, in the later part of the week, most of the gains were seen pared as traders’ seen booking profits at higher level ahead of the weekend. Nifty ended the week with gains of nearly 0.75% while Banking index also managed to close in green territory. During the week, healthcare stocks witnessed buying interest, while media stocks exhibited a significant rebound. In the Nifty index, the highest concentration of call and put open interest was observed at the 19400 strike. Previously, the maximum call open interest was at the 19500 strike, while for put options, it was at the 19300 strike. In the Banknifty, the maximum concentration of call and put open interest is at the 45000 strike. The implied volatility (IV) for call options concluded at 10.38%, while put options closed at 11.29%. The Nifty VIX, which measures market volatility ended the week at 11.84%. The PCR OI (Put-Call Ratio Open Interest) settled at 1.42 for the week more than the previous week indicates more put writing. Technically both the indices are still looking strong despite a heavy sell off seen on Friday’s session. So, we advise traders to use these dips for creating fresh longs.
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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 prices traded down last week tracking cues from the picking up of sowing activities in Telangana and Maharashtra. Prices which jumped to yearly high of 10376 in earlier part of week due to monsoon worries in Maharashtra, tumbled about 7% from high later with advancement of sowing progress. Lowering demand from stockists also weighed on market sentiments. Prices correction in turmeric is likely to remain continue due to demand concerns. Rally in turmeric prices in June’23 will prompt farmers to increase their area under turmeric that will put pressure on prices. However, it will be bit early to say how much acreages will increase as overall sowing has been delayed due to slower monsoon progress in June. Overall arrivals have been reported higher by 4% Y-o-Y since 1st Apr till end of first week of July as about 170 thousand tonnes of turmeric has arrived during above mentioned period as compared to 163 thousand tonnes of previous year. Export demand of turmeric has improved in recent months that are likely to cap the major downfall in prices. Turmeric Aug contract is likely to trade in range of 9200-9800 levels.
Jeera futures resumed their rally on supply concerns and touched the fresh high of 59120 levels for July contract. Supply disruption in Gujarat caused by heavy rainfall supported rally in jeera prices. However, physical demand has been lower as millers are showing lesser interest in fresh buying with slow down in festive and wedding season demand. Moreover, increased imports of jeera at cheaper rate also likely to cap the upside in Jeera. Going forwards, prices are likely to trade sideways as forecast of heavy rainfall in Gujarat in coming week may lead to supply disruption that will keep prices up in near term. Inventories are drier as most of the millers are going for need based buying so any correction in jeera will be a buying opportunity for millers and stockists. India exported about 16.28 thousand tonnes of Jeera in Apr’23 against the 9.94 thousand tonnes of previous year. jeera Aug prices are likely to trade in range of 51600 – 61500 levels.
Dhaniya NCDEX Aug prices are likely to trade mix to down on increased arrivals in the market. There are heavy stocks with farmers as well as stockists that will put pressure on prices. Export demand has improved that will cap the major downfall in prices. About 10.68 thousand tonnes of dhaniya was exported in Apr’23 as compared to 3.16 thousand tonnes of previous year Dhaniya NCDEX Aug futures are likely to trade in range of 6350-7000 levels.
Gold prices experienced their fourth consecutive weekly decline as investors speculated that the Federal Reserve would maintain higher interest rates for an extended period. This outlook placed downward pressure on gold, which lacks yield. Despite concerns about a potential recession resulting from increased interest rates, the US private payrolls data for June exceeded expectations, indicating a resilient labour market. Federal Reserve Bank of Dallas President, Lorie Logan, expressed her belief that a rate hike was warranted at the June policy meeting and emphasized the necessity of further rate increases to cool down the still robust economy. Market indicators from CME's Fed watch tool currently indicate a 92% probability of a 25-basis-point increase in July, following the previous month's pause. Additionally, the yield on 10-year Treasury notes rose to its highest level since March 2, further dampening gold's appeal. Meanwhile, the Bank of Japan's Deputy Governor, Shinichi Uchida, affirmed the continuation of its yield curve control policy for the time being. Given the elevated levels of US yields, gold faces challenges in maintaining its position above the $1,900 threshold in the near term. On COMEX, $1900 appears to be a crucial support level for gold, and if prices continue to hold above it and it may signal a positive outlook for the gold. If the price breaks below this level, it would be viewed as a selling opportunity, potentially leading to a decline in gold prices towards the $1,820 mark. Silver on COMEX continue to trade in the range of $21.900-$23.600 levels. Ahead in the week, Gold prices on MCX may witness both side movements where the possible trading range would be 56900-59900 levels. Silver prices on MCX may trade in the range of 67500-72000 levels.
Crude oil prices recorded positive gains throughout the week, despite concerns over higher U.S. interest rates potentially impacting energy demand. These worries were countered by indications of tighter supply following a larger-thananticipated decrease in U.S. oil inventories. The prices rose by approximately 2% for the second consecutive week. Robust refining demand contributed to a greater-than-expected drawdown in U.S. crude stocks, while gasoline inventories experienced a significant decline due to increased driving activity in the previous week, as reported by the EIA. However, the upward momentum of oil prices was limited by growing expectations of an interest rate hike by the U.S. central bank at its upcoming meeting on July 25-26. In June, the rates were maintained at a range of 5% to 5.25%. These rising expectations of higher interest rates added a restraining effect on oil prices. During the week, Saudi Arabia, a major crude oil producer, announced its decision to extend its voluntary production output cut by 1 million barrels a day for August also. Algeria, another producer, said it would also cut output by an extra 20,000 barrels a day in August. Ahead in the week, prices may continue to witness mixed move where buying near support is advised, and the possible trade range would be 5690-6150 levels. Natural gas price slid again about 2% after four consecutive gains as output back to near record level. It is expected that remained under pressure as a mixed weather outlook and ongoing production strength figured to preserve a healthy storage cushion heading into the heart of summer. Ahead in the week, prices may trade in the range of 190-240 levels.
Base metals may trade in range on mixed fundamentals as demand uncertainty in top consumer China and worries over more interest rate hikes by the U.S. Federal Reserve may cap gains while the prices may get support on Chinese stimulus hopes and decline in exchange inventories. China's economic growth has slowed in recent months, raising hopes for stimulus but unlikely to take action on the massive scale seen in 2008, mainly because of debt concerns. Copper may trade in the range of 695-730. Last month's premium for the LME's cash contract against three-month copper proved short-lived and swung to a discount in July, indicating plentiful near-term supply. Chinese smelters lifted their third-quarter guidance for treatment charges of copper concentrate to $95 per metric ton, the highest level in nearly six years, as they expect abundant supply and flat demand growth in the sector in the coming months.. The supply concern may support the prices as Chile's state-owned Codelco, the world's largest copper producer, expects a loss of about 7,000 metric tons of copper production in 2023 due to recent heavy rains. Zinc can trade in range of 203- 223. Lead can move in the range of 178-186. Aluminum may trade in the range of 190-208. The metal production has been squeezed between high European energy prices and years of high Chinese exports, largely in the form of semifabricated products. Steel long (July) is likely to trade in the range of 45000- 47500 with weak bias on NCDEX. Global steel demand will likely to decline on weaker offtake by the Chinese construction sector.
Cotton prices are likely to trade sideways to higher due to reports of fall in area under cotton. Cotton sowing area has lagged behind to last year by 10% Y-o-Y as on 7th July due to slower sowing progress in Maharashtra and Telangana. About 70.5 lakh Ha was sown under cotton against the 79.15 lakh Ha of previous year. Slower pace of arrivals will support firmness in cotton prices in near term. Gains will be limited as spinning mills were slow in making new purchases due to poor demand from the weaving industry. Cotton MCX July prices are likely to trade in range of 5400-58000 levels. Similarly, Kapas Apr’24 futures are likely to trade in range of 1450-1530 levels.
Cotton seed oil cake NCDEX Aug futures are likely to trade on positive note due to slower arrival pace in the market. Reports of fall under acreages will support firmness in prices. Surging prices of rival oil meals are likely to keep market sentiments up for cotton seed oil cake. Cotton seed oil cake Aug prices are likely to trade in range of 2400- 2750 levels.
Guar seed Aug futures is likely to trade mixed to higher on increased physical demand. Major focus of market has shifted towards sowing progress. About 10 lakh Ha was sown under Guar in Rajasthan as on 6th July as compared to 9.6 lakh Ha of previous year. Sowing activities is yet to pick up but overall area is likely to be down due to lower realization on guar that will lead to shift in area of guar to other profitable crops. However, weakness in crude oil prices will cap the gains in guar. Guar seed prices will trade in range of 5250-5600 levels in near term wherein Guar gum prices are likely to trade in range of 9800-10900 levels.
Mentha oil July contract is likely to trade on positive bias as prices may witness short covering with emerging buying interest in physical market. Gains are likely to be limited due to improved production prospects. Yield is likely to increase due to favorable weather condition in major producing states. Moreover, reports of slack export of menthol will restrict the gains. Mentha oil prices are likely to trade in range of 885-940 levels.
Castor seed prices are expected trade higher due to shrinking supplies in the market. Increased export of castor seed meal will also keep market sentiments up. India exported about 79.87 thousand tonnes of castor meal during Apr- May’23 as compared to 56.9 thousand tonnes of previous year. Prices will track the ongoing sowing progress to decide the further trend. Sowing is in initial stage as about 24 thousand Ha was sown under castor in Gujarat as on 7 July Vs 6 thousand Ha of previous year. Castor seed Aug prices are likely to trade in range of 5650-6200 levels.
It closed at Rs. 181.45 on 06th Jul 2023. The 18-day Exponential Moving Average of the commodity is currently at Rs 184.56. On the daily chart, the commodity has Relative Strength Index (14-day) value of 41.708. Based on both indicators, it is giving a sell signal.
One can sell near Rs.184 for a target of Rs. 178 with the stop loss of 186.50.
It closed at Rs. 5941.00 on 06th Jul 2023. The 18-day Exponential Moving Average of the commodity is currently at Rs 5888.84. On the daily chart, the commodity has Relative Strength Index (14-day) value of 64.888. Based on both indicators, it is giving a buy signal.
One can buy near Rs.5900 for a target of Rs.6500 with the stop loss of 5700.
It closed at Rs. 5979.00 on 06th Jul 2023. The 18-day Exponential Moving Average of the commodity is currently at Rs 5917.29 On the daily chart, the commodity has Relative Strength Index (14-day) value of 64.03. Based on both indicators, it is giving a buy signal.
One can buy near Rs. 5930 for a target of Rs. 6250 with the stop loss of 5800.
NOTE: *M.High / M.Low stands for Monthly High / Monthly Low
CRB witnessed a pause in the fall and appreciated marginally despite the weak data. Dollar index zoomed up for continuous third week. Gold witnessed a pause whereas silver moved up for second week. Gold prices steadied on Thursday after falling in the prior session as the minutes of the Federal Reserve’s June meeting showed that policymakers supported more rate hikes, presenting a dour outlook for metal markets. Natural gas was on the back foot whereas crude oil moved up. Crude prices jumped as the market digested fears of global economic slowdown alongside tighter crude supply. On the supply side, top oil exporters Saudi Arabia and Russia announced a fresh round of output cuts for August. The total cuts now stand at more than 5 million barrels per day (bpd), equating to 5% of global oil output. The cuts along with a bigger than expected drop in U.S. crude stocks provided some support for prices. Natural gas prices slid on as producers concluded on-site maintenance, resulting in higher output. Base metals were remained weak. Weak economic data from major importer China, coupled with a potential escalation in a Sino-U.S. trade war, also presented a dour outlook for copper. China imposed curbs on key chipmaking material exports to the U.S. this week, which markets fear could invite retaliatory measures. China's services activity expanded at the slowest pace in five months in June, a private-sector survey showed and euro zone business activity slipped into contractionary territory. In the euro zone and United States manufacturing activity slumped in June to levels last seen when the global economy was reeling from the initial wave of the COVID- 19 pandemic and lockdowns.
Agri commodities were mostly traded under pressure on progress in monsoon. In agri, castor seed prices saw a pause. India exported about 79.87 thousand tonnes of castor meal during Apr- May’23 as compared to 56.9 thousand tonnes of previous year. Cotton oil seed cake futures cruised near support level. Guar prices couldn’t stay at higher side. Jeera prices again skyrocketed while turmeric prices dipped down as sowing is in initial stage and likely to pick up as weather conditions has turned favorable for sowing activities. Heavy rainfall in Gujarat disrupted the arrival pace that supported firmness in prices. Turmeric prices corrected as millers are avoiding bulk buying in anticipation of rise in arrivals. Mentha oil recovered from the low despite the expectation of rise in yield due to favorable weather condition in major producing states. Moreover, reports of slack export of menthol will put pressure on prices.
India is the world's leading spice producer, exporter and consumer. Over the years, export promotion activities from the government have benefitted the exporters. As per the minister of commerce and industry Piyush Goyal, Spice exports from India have doubled in the last nine years, reaching the value of Rs 3,995 crore in the fiscal year 2022-23 from Rs 1,778 crore in 2013-14. The Spice Board had aggressively taken a lead in strengthening and promoting the Indian-International spice trade for the larger benefits of the spice community, more so during the pandemic time. But the global slowdown is expected to affect India's export of spices. However, the surge in demand post the pandemic has cooled down as a result export value has remained the same for the last two years at $4 billion.
The dollar index stabilized around 103 as investors awaited the US jobs report, which could impact Federal Reserve policy. Recent data showed strong job growth in June, with private companies adding 497,000 jobs, indicating a tight labor market. Job cuts were at their lowest since October, and the services sector also saw robust growth. These positive employment and services data have increased speculation of July interest rate hikes by the Federal Reserve. As for the dollar-rupee pair, it broke out above the 82.20 level and is expected to find support at 82.20 for potential further upside movement. The outlook suggests a range-bound trading between 81.80 and 83 levels, with possible reversals and corrections along the way. Looking ahead, the 82.20 level is expected to act as a support level in upcoming trading sessions, providing a potential foundation for further upside movement. Technical analysis of the pair's longerterm chart patterns reveals a consolidating price action, with the upper range situated around 82.90-82.95 levels. A decisive breakout above this range, particularly surpassing the 83 mark, may trigger a robust upward rally towards the 84 levels. However, it is worth noting that the Reserve Bank of India (RBI) may intervene near the 82.90-83 levels to prevent the pair from easily surpassing the 83 mark. Additionally, momentum indicators suggest the presence of room for further upside momentum, but caution should be exercised as the pair approaches the 83 mark. A potential revisal point could be reached, with increased probability for a downside correction. Taking all factors into consideration, the outlook suggests that the dollar-rupee pair is expected to remain within the range of 81.80 to 83 levels for the short to medium term. However, potential reversals and corrections should be anticipated along the way, given the inherent volatility in the currency markets.
USDINR (JUL)pair is currently in an Bullish trend as trading above its major Exponential Moving Average where, the 21-day Exponential Moving Average is around 82.45. However, the pair is in borderline territory with a Relative Strength Index (14- day) value of 66.2 on the daily chart. Major support is seen around 82.2 levels, while resistance is expected near 83 levels.
One can sell near 83 for the target of 82.2 with the stop loss of 83.4
GBPINR (JUL)pair is currently in an Bullish trend as trading above its major Exponential Moving Average where, the 21-day Exponential Moving Average is around 104.2. However, the pair is in borderline territory with a Relative Strength Index (14- day) value of 67.2 on the daily chart. Major support is seen around 104.2 levels, while resistance is expected near 105.75 levels.
One can sell near 105.75 for the target of 104.75 with the stop loss of 106.25
EURINR (JUL) pair is currently in an Bullish trend as trading above its major Exponential Moving Average where, the 21-day Exponential Moving Average is around 89.52. However, the pair is in neutral territory with a Relative Strength Index (14-day) value of 58.79 on the daily chart. Major support is seen around 89 levels, while resistance is expected near 90.9 levels.
One can buy near 89.9 for the target of 90.9 with the stop loss of 89.4
JPYINR (JUL) pair is currently in an Sideways trend as trading between its major Exponential Moving Average where, the 21-day Exponential Moving Average is around 58. However, the pair is in neutral territory with a Relative Strength Index (14-day) value of 47.56 on the daily chart. Major support is seen around 57.25 levels, while resistance is expected near 58.5 levels.
One can buy near 58 for the target of 59 with the stop loss of 57.5
Agri-input manufacturer Nova Agritech, server maker Netweb Technologies India and sewerage solution provider EMS have received capital market regulator Sebi's approval to raise funds through initial public offerings. The three companies, which filed their preliminary papers with Sebi between March and April 2023, obtained the regulator's observations during June 26-30, an update with the markets watchdog showed . In Sebi's parlance, obtaining observation means its go-ahead to float the initial share sale. As per the draft papers, Nova Agritech's initial share sale comprises a fresh issue of equity shares worth up to Rs 140 crore and an offer-for-sale (OFS) component of up to 77,58,620 equity shares of shareholder Nutalapati Venkatasubbarao. The proceeds from the fresh issue worth Rs 14.20 crore will be utilised for investment in its subsidiary Nova Agri Sciences for setting up a new formulation plant, Rs 10.49 crore for funding capital expenditure by Nova Agritech and towards the expansion of its existing formulation plant. Further, it will also use Rs 26.69 crore for funding of working capital requirement of Nova Agritech, Rs 56.74 crore for investment in Nova Agri Sciences, for funding working capital requirements and general corporate purposes.
Gujarat-based stainless steel products manufacturer Ratnaveer Precision Engineering has received approval from the capital market regulator for fundraising through an initial public offering. It was the second public issue that received a go-ahead from the Securities and Exchange Board of Idia (SEBI) last week, after another Gujarat-based company, SPC Life Sciences. The public issue of 1.74 crore equity shares of Ratnaveer comprises a fresh issue of 1.53 crore shares and an offer for sale of 21 lakh shares by promoter Vijay Ramanlal Sanghavi, as per the draft prospectus. The company filed its draft red herring prospectus with the SEBI in January 2023 to seek approval for IPO. The regulator issued its observations letter to the company on June 30, as per the update available with the SEBI on July 3. Generally, getting an observation letter is an intimation from the regulator to launch the initial public offering. As per the IPO papers, the stainless steel pipe and tube maker will utilise its fresh issue proceeds for working capital requirements, besides general corporate purposes. Ratnaveer operates its business through four manufacturing units in Gujarat. The company manufactures finishing sheets, washers and solar mounting hooks at unit-I and SS pipes and tubes at unit-II. Unit-III and unit-IV are used for the backward integration process where the former is the melting unit and the latter is the rolling unit. The domestic business contributed around 77 percent to its revenue and the rest is from exports.
Pharmaceutical ingredients maker SPC Life Sciences Ltd has received capital markets regulator Sebi's go ahead to raise funds through an initial public offering (IPO). The IPO consists of fresh issuance of equity shares worth Rs 300 crore and an Offer For Sale (OFS) of 89.39 lakh equity shares by promoter -- Snehal Rajivbhai Patel -- according to the draft red herring prospectus. The company may consider a pre-IPO placement aggregating up to Rs 60 crore and if such a placement is completed, then the fresh issue size will be reduced. The pharma company, which filed its draft papers with the markets regulator in March seeking its nod, obtained its observations letter on June 30, an update with the Securities and Exchange Board of India (Sebi) showed. In Sebi's parlance, obtaining an observation letter implies its go ahead to float the initial share sale. Going by the draft papers, proceeds from the fresh issue will be used to pay debt, support working capital needs and fund capital expenditure requirements for setting up Phase-2 at its Dahej facility in order to expand product offerings of pharmaceutical intermediates, and for general corporate purposes. Gujarat-based SPC Life Sciences is a leading manufacturer of advanced intermediates for certain key active pharmaceutical ingredients. Apart from SPC Life Sciences, Ratnaveer Precision Engineering Ltd has received Sebi's nod to launch the IPO. It had filed its preliminary IPO papers with the regulator in January.
Muthoot Microfin Ltd, the microfinance arm of the Muthoot Pappachan Group, has refiled its draft papers with the Securities and Exchange Board of India to raise Rs 1,350 crore via initial public offerings. The firm had previously filed draft papers back in 2018. The IPO consists of a fresh issue of upto Rs 950 crore and an offer for sale (OFS) of upto Rs 400 crore by its promoters and shareholders. The OFS comprises up to Rs 70 crores each by Thomas John Muthoot, Thomas Muthoot and Thomas George Muthoot, up to Rs 30 crores each by Preethi John Muthoot and Remmy Thomas and Nina George and up to Rs 100 crores by Greater Pacific Capital WIV Ltd. As of March, Muthoot Fincorp holds a 72.36 percent stake in Muthoot Microfin. Creation Investments India has 11.13 percent sake while Greater Pacific Capital WIV Ltd has a 25.15 percent stake in the firm. The proceeds from the fresh issue will be used to augment the capital base. As of March 2023, the lender’s CRAR was 21.87 percent of which the Tier I Capital base was 21.87 percent. As per RBI guidelines, it has to maintain CRAR 15 percent consisting of tier I and tier II capital. ICICI Securities, Axis Capital, JM Financial and SBI Capital Marketsare the Book Running Lead Managers to the issue.
Hi-Green Carbon said it has filed preliminary papers for an initial public offering. The shares will be listed on NSE Emerge, a platform for small and medium enterprises. The Gujarat-based firm, which is into recycling of waste tyres, plans to offer up to 76 lakh equity shares with a face value of Rs 10 each through the book-building process. In the Initial Public Offering (IPO), there will be a fresh issue of 60 lakh shares and 16 lakh shares will be offloaded through the offer for sale route by the promoter group, it said in a statement. Proceeds from the public issue will be utilised to set up a new facility in Dhule district of Maharashtra, with a recycling capacity of 100 MT waste tyres per day. The proceeds will also be utilised for working capital requirements and other general corporate purposes. The company has appointed Beeline Capital Advisors as book running lead manager to the issue. Hi-Green Carbon is the flagship company of Rajkot-based Radhe Group of Energy.
Ideaforge Technology has turned out to be the first initial public offering (IPO) to get subscriptions more than 100 times since 2022. The drone maker may be enjoying the first-mover advantage from the drone-making industry and is expected to trade at expensive valuations. The public issue of the drone manufacturing company was subscribed more than 106 times during June 26-30, getting more than Rs 33,000 crore worth of bids at the higher end of the price band of Rs 638-672 per share. Qualified institutional investors (QIIs) were at the forefront as their reserved portion was booked 125.81 times, while the part set aside for retail investors and high networth individuals (HNIs) was subscribed over 85 times and 80 times, respectively. The total fundraising planned by the unmanned aircraft systems maker via IPO was Rs 567 crore of which Rs 254.88 crore was already raised via anchor book on June 23, a day before opening the issue. The remaining Rs 312 crore issue opened for subscription during the current week ending June 30.
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Bandhan Mutual Fund has announced the launch of the Bandhan Financial Services Fund, an open-ended equity scheme, that allows investors to benefit from the multi-year growth opportunities in the financial services sector. The New Fund Offer will open for subscription on July 10 and will close on July 24. “A significant portion of India’s economic growth is fueled by the financial services sector. Powerful enablers like increasing financial inclusion, growing digitization, and the relatively stronger balance sheet of banks and NBFCs provide visibility for strong earnings growth for this sector. It has been a key driver of returns for the capital market with the Financial Services Index growing 18X since inception compared to 10X for the Nifty 500 Index,” said Vishal Kapoor, CEO, Bandhan AMC. “The Bandhan Financial Services Fund will go beyond the traditional Banking sector by diversifying further with investments in Capital Markets, NBFCs, Insurance, and Fintech as well, providing investors with an opportunity to benefit from India’s long-term growth story,” added Kapoor.
Nippon India Life Asset Management has announced that it will not accept lump sum investments into Nippon India Small Cap Fund (NISC) from July 7. The restriction will also apply to switch in transactions. The fund house has further made it clear that fresh registrations through systematic investment plan (SIP) without initial investment or systematic transfer plan (STP) or such other special product shall continue with a limit of Rs 5 lakh per day per PAN. Existing SIP and STP will not be affected due to this announcement. “The limit on subscription of units of the scheme is being proposed to facilitate gradual deployment of corpus in order to align with the nature of small cap investing. The step is warranted considering the recent sharp rally in the small cap space and increased investor participation through high ticket investments which would be in the best interest of existing unit holders and appropriate for incremental investments,” said the addendum released by the fund house. NISC is the largest small cap fund in the mutual fund industry with assets under management of Rs 31,945 crore. The fund has given 39.77 percent returns in last one year compared with 30.8 percent average returns given by the small cap category, as per Value Research. NISC is managed by Samir Rachh and Tejas Sheth.
SBI Mutual Fund, largest fund house by a wide margin in the 43-player industry, has clocked yet another milestone crossing the Rs 8 lakh crore-mark assets under management, adding Rs 90,000 crore to the asset pile during the first quarter of the fiscal. Given the current run rate in adding AUM (asset under management), the fund house expects to sniff at the Rs 10 lakh crore AUM-mark over the next 12 to 18 months too. The 43-player mutual fund industry closed May with total assets of Rs 43.2 lakh crore despite a fall in net inflows into open-ended mutual funds, which almost halved to Rs 59,879.31 crore from Rs 1.24 lakh crore in April, when the industry-wide AUM stood at Rs 41.61 lakh crore.
Edelweiss Mutual Fund has announced the merger of two of its passively managed schemes. Edelweiss ETF-Nifty Bank (ENB) will merge with Edelweiss Nifty Largemidcap 250 Index Fund (ELM250), the fund house wrote to its unitholders. The record date for the merger is August 7, 2023. ENB is an open-ended scheme tracking Nifty Bank Index and ELM250 is an open-ended equity scheme replicating Nifty LargeMidcap 250 Index managing assets worth Rs 2 crore and Rs 50 crore, respectively as on May 31, 2023. While the former has given 35 percent returns the latter has given 26.4 percent returns in one year ended July 3, 2023, as per Value Research. “Considering the AUM of ENB and given very minimal trading volumes on the exchange it is prudent to merge ENB with ELM250 to provide more liquidity to investors in ENB,” the fund house said in a letter to unitholders explaining the rationale behind the merger. The fund house sees index funds as a more efficient means to invest in stocks over ETFs due to reduced impact cost on transactions, no brokerage and ability to invest without a demat account, among other benefits. Index funds also allow inflows through systematic investment plans, which may not be possible with ETFs. The fund house has been focusing on index funds instead of ETFs while building a passive investing portfolio in equities. In the last one year it has launched index funds tracking indices such as Nifty Smallcap 250 Index, Nifty Next 50 Index and Nifty Midcap150 Momentum 50 Index. In September 2021, the fund house also converted the ETF tracking Nifty 50 into Edelweiss Nifty 50 Index Fund and ETF tracking Nifty 100 Quality 30 ETF into Edelweiss Nifty 100 Quality 30 Index Fund.
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