In the week gone by, global stock market witnessed a volatile trade as investors worried that the U.S. Federal Reserve's aggressive approach to rein in inflation could trigger a recession. The rate hike by Fed sent the dollar to a new 20-year high and deepened the inverting US Treasury yield curve as Fed had been aggressive on rates to curb scorching levels of inflation at the expense of economic growth. The US Fed turned more hawkish than anticipated, increasing its rate forecast to 4.4% by the end of 2022. In an attempt to boost the country’s faltering economic growth, the new U.K. government has announced a sweeping program of tax cuts and investment incentives. It comes a day after the Bank of England said the U.K. economy was likely to have entered an official recession in the third quarter, as it hiked interest rates by 50 basis points to combat decades-high inflation in the recent meeting. Meanwhile the Bank of Japan stuck to its dovish monetary policy as the government made a surprise move to intervene in the currency market amid rising inflation and the sharp fall in the yen’s value against the dollar.
Back at home, domestic markets too witnessed volatile trade mirroring weak global market trends after the US Fed's interest rate hike. The hike in interest rates by Fed caused havoc among foreign investors and rupee to deteriorate further. Indian rupee weakened past 81 mark to a fresh record low against US dollar for the first time while 10-year bond yield jumped 6 basis points to hit over two-month high on the back of surge in US treasury yields. A weaker currency is likely to make imports more expensive and keep inflation elevated for longer. Meanwhile, RBI is expected to hike rates in the next week meet, although there were differences over how far it would go with inflation accelerating to 7% and with the rupee weakening. The RBI has lagged many of its global peers, despite inflation sticking above the top end of its target range of 2-6% all year. Since May, the Indian central banks has raised rates in three separate moves, one of them unscheduled, totaling 140 basis points and taking the key repo rate to 5.40%. Going forward, stock market will continue to trade tracking both global and domestic factors.
On the commodity market front, commodities traded in a range with downside bias ahead of Fed meet; a much awaited event. CRB was marginally down as the impact of rate hike was discounted to some extent in previous week as well when higher inflation almost confirmed the rate hike. The hawkish comments cemented expectations that U.S. interest rates will end the year well above 4% - their highest level in over 14 years. The U.S. dollar jumped to a new 20-year high against a basket of currencies on Thursday, extending gains after the Federal Reserve raised interest rates and struck a more hawkish than expected tone in its latest meeting. The greenback also took support from increased safe-haven demand, on signs of a potential escalation in the Russia-Ukraine conflict. Bullion traded in a range with marginal upside due to depreciation in INR. Oil prices have pulled back significantly in the past few months, mostly due to demand destruction expectations, due to a slowing global economy, as well as U.S. strategic reserve releases. To note the U.S. strategic reserve shrunk to almost half compared with levels from a decade ago. Durable Goods Orders, Consumer Confidence & New Home Sales are some key data, which are scheduled this week, which is likely to give significant impact on 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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SMC or its associates including its relatives/analyst do not hold any financial interest/beneficial ownership of more than 1% in the company covered by Analyst. SMC or its associates and relatives does not have any material conflict of interest. SMC or its associates/analyst has not received any compensation from the company covered by Analyst during the past twelve months. The subject company has not been a client of SMC during the past twelve months. SMC or its associates has not received any compensation or other benefits from the company covered by analyst or third party in connection with the research report. The Analyst has not served as an officer, director or employee of company covered by Analyst and SMC has not been engaged in market making activity of the company covered by Analyst.
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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 management expects public capex spends comprising of Centre, States and Public Sector Units in the current year to be better than that of the previous year. Moreover, the private capex would also witness improvement in the second half of the current year. On this backdrop, the prospects of order pipeline are robust indicating strong revenue growth visibility. Cooling off in commodity prices is expected to be margin accretive for the company. Thus, it is expected that the stock will see a price target of Rs. 2227 in 8 to 10 months’ time frame on current P/E of 28.59x and FY23 EPS of Rs.77.88.
The company has strong track record on quarterly as well as yearly basis and it has successfully managed to maintain the sales momentum of laminates by adopting new strategies. According to the management, capacity addition across segments would boost revenue and profitability going ahead. It has strong financials with robust return ratios and it has under gone significant capex since last few years and able to maintain its operating cash positive. Thus, it is expected that the stock will see a price target of Rs.811 in 8 to 10 months time frame on a one year average P/Bvx of 9.36x and FY23 BVPS of Rs.86.69.
The stock closed at Rs 123.00 on 23rd September, 2022. It made a 52-week low at Rs 74.15 on 20th June, 2022 and a 52- week high of Rs. 221.30 on 10th November, 2021. The 200 days Exponential Moving Average (DEMA) of the stock on the daily chart is currently at Rs 126.49
As we can see on chart that the stock is continuously trading in higher highs and higher lows, sort of rising wedge on weekly chart which is bullish in nature. Last week, the stock gave the breakout of falling trend line and closed with marginal loss with high volumes so further upside is anticipated from the stock from current levels. On the indicators front such as RSI and MACD are also suggesting buying for the stock. Therefore, one can buy in the range of 121-122 levels for the upside target of 142-146 levels with SL below 112 levels.
The stock closed at Rs 921.10 on 23rd September, 2022. It made a 52-week low at Rs 733.70 on 06th December, 2021 and a 52-week high of Rs. 967.05 on 29th April, 2022. The 200 days Exponential Moving Average (DEMA) of the stock on the daily chart is currently at Rs 855.19
Short term, medium term and long term bias are looking positive for the stock as it is trading in higher highs and higher lows on chart. Apart from this, it is forming an “Inverse Head and Shoulder” pattern on daily charts and is likely to give the pattern breakout along with high volumes so further buying may expected in coming days. Therefore, one can buy in the range of 910-915 levels for the upside target of 1000-1030 levels with SL below 860 levels.
Disclaimer : The analyst and its affiliates companies make no representation or warranty in relation to the accuracy, completeness or reliability of the information contained in its research. The analysis contained in the analyst research is based on numerous assumptions. Different assumptions could result in materially different results.
The analyst not any of its affiliated companies not any of their, members, directors, employees or agents accepts any liability for any loss or damage arising out of the use of all or any part of the analysis research.
SOURCE: RELIABLE SOFTWARE
Charts by Reliable software
As US interest rates hit 14-year high in inflation, battle global market observed another melt down in the week gone by. Nifty and banknifty closed in red week on week basis where more selling was seen in banknifty as compared to nifty. Banknifty slipped and closed below 40000 psychological level. Implied volatility (IV) of calls closed at 17.57% while that for put options, it closed at 18.97%. The Nifty VIX for the week closed at 18.82%. PCR OI for the week closed at 0.92. From the derivative front, call writers remained active at 17500-17600 & 17700 strikes whereas put writing was observed at 17000 strike. In banknifty, call writers are active at 40000 call strike whereas put writers added marginal position in 39500 and 39000 strikes. For upcoming week, we expect markets to remain under pressure once again and volatile. On downside, 17200-17000 zone would act as support for Nifty while 17500-17600 zone is likely to cap upside in prices. We advise traders to focus on stock specific action and avoid making any fresh position unless there is any positive data build up in the market.
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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: Turmeric (Oct) futures is expected to trade sideways to higher mainly due to supply contains. Stocks have been tightening in result of lower production wherein arrivals have also dropped by 40% Y-o-Y so far in Spe’22 due to lower production. Government official data showed only 7676 tonnes of turmeric were reported in Sep’22 compared to 12803 tonnes of previous year. In the wake of off season of arrivals ahead, supply of turmeric is likely to remain tight that will cap the downfall in prices. Ongoing festive buying coupled with robust export demand will also support the firmness in prices in near futures. India has exported around 62 thousand tonnes of turmeric during Apr’22-Jul’22 compared to 52 thousand tonnes of previous year, higher by 18% Y-o-Y. Prices will track cues from ongoing sowing progress in Telangana and Andhra Pradesh that is running on positive note. Going forward prices will remain volatile may find support near 6850 and is likely to honor 7500 as resistance.
Jeera (Oct) prices showed sharp recovery due to renewed buying. Demand in Spice Industry is active in wake of rise in festive buying of the commodity. Most of the spice makers and retail sellers are running with tighter stocks and they have no other choice to buy jeera at inflated price as new crop is still far away by 3-4 months. Big players are holding the most of the stocks and driving the market accordingly. Apart from that, prices are likely to be supported by export demand as global buyers are looking for Indian jeera due to lower production in Syria and Turkey. Jeera prices are holding the support of 24300 and will move up towards 26200 in coming weeks.
Dhaniya (Oct) futures are expected to trade mixed to down on adequate supply at physical market that will keep buyers away from bulk buying. Supplies of dhaniya have improved in the market as rise in imports has overshadowed the lower production in the country. Surging cheaper imports from Russia, Syria and other global counties is likely to weigh on domestic prices. India has imported about 19 thousand tonnes of Dhaniya during the time period of Jan’22-Jul’22 compared to 4.4 thousand tonnes of previous year. Some upward reversal is likely to be seen on increased festive buying by spices makers. Prices are likely to find support near 10100 with resistance of 11500.
Bullion prices reversed from two years low as market expectation rises for a Fed rate hike after the previous week’s inflation data. Although the rally is short-lived and overall, the trend will continue to be negative for gold as the Federal Reserve told that they’re quite determined to increase rates. U.S. central bank hiked interest rates by 75 basis points for a third straight time and signaled that borrowing costs would keep rising this year. The U.S. central bank projected the policy rate would rise to a 4.25%-4.50% range by the end of 2022, and to a range of 4.50%-4.75% by the end of 2023. Interest rate hikes to fight soaring inflation tend to raise the opportunity cost of holding zero-yield bullion. Gold prices have fallen nearly 20% since scaling above the key $2,000 per ounce mark in March. Gold’s biggest struggle in the last few months has been the persistent strength in the US dollar. Global stock markets are on track for a weekly loss, as Treasury yields and the dollar climbed further after the Federal Reserve decision. Silver market has managed to rally up to as high as $19.86/oz even as stocks, bonds, and most commodities have drifted lower. President Vladimir Putin ordered Russia's first wartime mobilization since World War Two on Wednesday, shocking citizens with what Western countries described as an act of desperation in the face of a losing war. Holdings of SPDR Gold Trust, the world's largest gold-backed exchange-traded fund, fell 0.12% to 952.16 tonnes from 953.32. Ahead in the week prices may continue to trade with a bearish bias and the trading range for Gold would be 48500-51200 and for silver, it is 54200-59300.
Energy counter also posted negative returns as oil inventory build of 1.1 million barrels for the week to September 16. The market tone remained bearish due to concerns that the aggressive monetary tightening in the U.S. and Europe would boost the likelihood of a recession and a slump in fuel demand. Since oil prices have been falling in the anticipation of the rate hikes, they may briefly rise after the announcements, but they will likely return to a downward trend again on fears over weakening demand. US may encourage OPEC to no longer boost production as oil inventories increase for the third consecutive week. Both benchmark contract WTI and Brent contracts were down 2.3% and 1.5% for the week so far. In the wake of accelerating rate hikes by the major central banks, the risk of a global economic recession overshadows supply issues in the oil markets, despite the recent escalation in the Russia-Ukraine war. However, a sharp fall in the U.S. SPR and drawdown in inventories may still keep oil prices supported at some point as there is still an inevitable undersupply issues in the physical markets, while Iran’s nuclear deal is in stalemate. Ahead in the week, crude prices on MCX are likely to trade in the range of 6480-6900. Natural gas prices witnessed selling throughout the week, as record output and forecasts for milder weather through early October that should allow utilities to inject more gas than usual into storage over the next few weeks. On technical front chart, pattern looks bearish and prices may continue to witness selling and the possible trading range would be 540-650.
Base metals may trade with a mixed bias due to prospects of improved demand from China against slowing global growth amid rising interest rates and an escalating Ukraine war after Moscow's new mobilisation campaign. Investors have been on edge amid worries that aggressive monetary policy tightening as many central banks raised their interest rates, following the U.S. Federal Reserve in the fight against inflation, which have been sending shockwaves through financial markets and the economy. The base metal may get support on optimism that stimulus measures would boost demand in top metals consumer China that recently announced 1.8-trillion-yuan investment worth of infrastructure projects to revive sluggish economic growth. Copper may trade in the range 625-670 levels. The global refined copper market showed a 30,000-tonne deficit in July, bringing the deficit level in the first seven months of the year to 126,000 tonnes, data showed. Aluminum may trade in the range of 185-205 levels. High energy costs have forced European aluminium smelters to cut annual production capacity by 1.1 million tonnes and some Chinese smelters face energy rationing. But despite this, global aluminium output rose in August by 3.5% year-on-year to 5.888 million tonnes, International Aluminium Institute data show. Zinc can trade in the range of 270-290 levels. Lead can move in the range of 175-185 levels. The global zinc market was in a surplus of 83,000 tonnes in the first seven months of 2022, while the lead market was over-supplied by 25,000 tonnes in the same period, data from the International Lead and Zinc Study Group showed. Steel long is likely to trade in the range of 46800- 49500 levels with bearish bias on NCDEX.
Cotton (Oct) MCX prices are likely to slip further on lukewarm demand of cotton in domestic as well as in global market. Ban of imports of Chinese yarn in US is hurting the export demand of Indian cotton as Chinese millers has cut imports from India. India is ready with bumper crop in year 2022-23 due to substantial rise in area and likely to produce 360 lakh bales higher by 17% Y-o- Y. With fall in export prospects and bumper production outlook supply is likely to be much higher in year 2022-23. Arrivals of new crop is picking up in central as well as in northern part of India that will keep millers away from heavy buying. Prices are expected to slip towards the support of 32000 levels with resistance of 38200.
Cotton seed oil cake NCDEX (Dec) futures are likely to trade down due to increasing supplies of new cotton crop in the market. Supply of other kharif oil seeds is also likely to pick up that will weigh on the market sentiments. Prices are expected to trade in 2200- 2541 range.
Guar seed futures are likely to be volatile & may keep bias on down side. Demand for guar has been sluggish as arrivals of new crop are likely to pick up from Oct onwards. Production is expected to rise significantly due to rise in area under guar in Rajasthan. Millers are preferring hand to mouth buying in wake of bumper crop ahead. However, emerging export enquires of gum will cap the losses in guar seed. Guar seed prices may slip towards 4900 with resistance of 5350.
Mentha oil (Oct) is likely to trade on weaker note due to sluggish buying in local market. With resistance of 1030, prices are likely to correct toward 955 due to hand to mouth industrial buying. However, overall production of mentha oil has been down in year 2022 that will cap the downfall.
Castor seed (Oct) prices are expected to trade down due to improved crop condition in major Gujarat. Production is likely to jump significantly on account of increased area under castor which has increased by 22% Y-o-Y in year 2022. Demand side fundamentals of castor are also looking weak as export of castor oil has dropped due to cut in buying from China. C Being as largest importer, China has imported only 1.75 lakh tonnes of castor oil during Jan’22- Jul’22 compared to 2.25 lakh tonnes of previous year down by 22%. Going forward, castor seed prices are likely to find support near 7200 level in near term with resistance of 7600.
It closed at Rs. 602.80 on 22nd Sep 2022. The 18-day Exponential Moving Average of the commodity is currently at Rs 652.16. On the daily chart, the commodity has Relative Strength Index (14-day) value of 34.618. Based on both indicators, it is giving a sell signal.
One can sell near Rs. 605 for a target of Rs. 565 with the stop loss of 625.
It closed at Rs. 50252.00 on 22nd Sep 2022. The 18-day Exponential Moving Average of the commodity is currently at Rs 50313.23. On the daily chart, the commodity has Relative Strength Index (14-day) value of 44.673. Based on both indicators, it is giving a sell signal.
One can sell near Rs. 50500 for a target of Rs. 49000 with the stop loss of 51000.
It closed at Rs. 10287.00 on 22nd Sep 2022. The 18-day Exponential Moving Average of the commodity is currently at Rs 9870.52. On the daily chart, the commodity has Relative Strength Index (14-day) value of 56.254. Based on both indicators, it is giving a sell signal.
One can sell near Rs. 10100 for a target of Rs. 9600 with the stop loss of 10350.
NOTE: *M.High / M.Low stands for Monthly High / Monthly Low
Commodities traded in a range with downside bias ahead of Fed meet; a much awaited event. CRB was marginally down as the impact of rate hike was discounted to some extent in the previous week as well when higher inflation almost confirmed the rate hike. The Fed raised interest rates by 75 basis points on Wednesday, as expected. Chairman Jerome Powell warned that the bank will keep hiking rates at a sharp clip, even risking pressure on economic growth and the labor market, as it struggles to rein in runaway inflation. The U.S. dollar jumped to a new 20-year high against a basket of currencies on Thursday, extending gains after the Federal Reserve raised interest rates and struck a more hawkish than expected tone in its latest meeting. The greenback also took support from increased safe-haven demand, on signs of a potential escalation in the Russia-Ukraine conflict. Russian President Vladimir Putin signed a decree calling for partial troop mobilization in the country, and also raised the threat of using nuclear force. Bullion traded in a range with marginal upside due to depreciation in INR. The Indian rupee hit a record low of 81 against the dollar on Friday after the U.S. Federal Reserve raised interest rates, while concerns over Russia also weighed after Moscow escalated tensions with Ukraine. Metal markets shared a similar degree of volatility as most other asset classes after the Fed raised interest rates by 75 basis points, as expected. Industrial metals traded in pressure except Lead. The red metal also has to contend with weakening economic growth in China, the world’s largest copper importer. However, the downside in metals were limited as China's Shanghai city on Tuesday announced 1.8-trillion-yuan investment worth of infrastructure projects, echoing national policymakers' calls to revive sluggish economic growth hurt by the COVID-19 pandemic, a property downturn, weak domestic demand, and a fading trade outlook. In energy pack, crude traded down on negative trigger whereas natural gas witnessed rebound from the low. Data showed that U.S. road travel fell 3.3% in July, as high fuel prices continued to dent gasoline demand in the country. Chinese crude refiners to increase exports could result in a potential supply glut for crude markets.
In spices, jeera and turmeric saw some gain whereas Dhaniya witnessed fall on improved supply from Russia and Syria. Guar witnessed profit booking from higher side. Cotton was down on better production prospects supported by reports of satisfactory crop progress in central Indian especially in Gujarat and Maharashtra. Castor prices slipped further in the wake of limited demand. Improved crop condition facilitated by favorable weather in central India is likely to pull down the prices.
Zinc ......Tug of war between weak demand and sliding supply
After Russia's military operations in Ukraine in the last week of February, most industrial metals began to fall sharply from their highs on weak demand amid fears of a resurgence of global economic growth already hit by COVID. Pressure from the US dollar, which reached a two-decade high, also affected the base metal prices adversely. Due to surging inflation, central banks across the world were prompted to hike interest rates. A high rate of interest would control the purchasing power of customers, which in turn would lead to low demand.
The London Metal Exchange (LME) three-month zinc price is currently trading around $3,130 per tonne, a long way off March's record high of $4,896, as the market prices in Chinese demand weakness and the rising prospect of European recession.
Weakening demand
Zinc's usage decreased so far this year has come largely from China, where a troubled property sector has depressed demand for steel. China's national steel production fell by 6.4% year-on-year in the first seven months of 2022, according to the World Steel Association. Broader manufacturing activity has also taken a hit last month due to combination of continued COVID-19 lockdowns and power rationing in drought-affected parts of the country.
Demand fears have now spread to Europe, which seem to be facing imminent recession due to soaring power prices. Business activities in Europe suffered their biggest contraction in 18 months because of higher prices and falling demand. The US economy has also shrunk from April through June, for a second straight quarter. This is stirring concerns that the world’s largest economy is heading towards a recession.
Low stocks & high premiums
The price is falling despite low exchange inventory. LME stocks currently stand at 75,700 tonnes, down by 123,625 tonnes on the start of the year. Shanghai Futures Exchange inventory has been sliding as well, hitting a fresh 2022 low of 58,407 tonnes last week. European buyers are currently paying record premiums of over $500 per tonne on top of the LME price to secure spot units, according to Fastmarkets. That's five times more than they were paying at the start of 2021.
Sliding supply
The global zinc market moved to a deficit of 72,800 tonnes in July from a surplus of 34,600 tonnes a month earlier, data from the International Lead and Zinc Study Group (ILZSG) showed. It's the demand outlook that's weighing on the zinc price; but the accumulating supply problems are preventing any rebuild in exchange inventory and keeping physical supply-chains tight. During the first seven months of 2022, ILZSG data showed a surplus of 83,000 tonnes versus a deficit of 23,000 tonnes in the same period of 2021.
Europe is at the epicenter of the global zinc supply hit as smelters struggle to cope with soaring power prices. Nyrstar's 315,000- tonne-per-year Budel smelter in the Netherlands is the second to close fully after Glencore placed its Italian smelter on care and maintenance at the end of last year. Power problems have also hit Chinese production in the last couple of weeks with temporary curtailments due to rationing in Sichuan province earlier this month. Most of that capacity has already restarted but Chinese refined zinc production is struggling this year, down 3.3% year-on-year in the January-August period, according to Shanghai Metal Market.
Indian Rupee completely reversed its last week's gains when it reached one month high to a dollar supported by steady FIIs flows. However, expectations of rate differential between the US and China widened ahead of the FOMC meeting next week triggering the Chinese yuan to fall below 7/$ for the first time in two years. Despite external vulnerabilities rupee managed to hold the 80.00 handle as RBI intervention remains strong to defend the rupee as well. Going forward in FOMC week, we can expect USDINR to trade on a positive bias and may trade in a range between 79.40 to 80.30 on a weekly basis. On the majors, the Pound fell to a new 37-year low below 1.14 vs the dollar this week after UK retail sales plunged to a record low of -1.6% in August vs an estimated -0.5% on a month-to-month basis. We think GBPINR is set to fall below 89.50 in the coming days as the underlying gbpusd remains weak with rupee depreciation staying in a limited range. While euro consistently trade below parity as expectations of the Fed’s aggressive rate hike pushed down any pull-back in the euro as well. Our base case remains for a 75 bps hike which will widen the rate differential between the US and the EZ to favor the dollar over the euro while EURINR likely to face the heat to slide below 78.50 in the coming days.
USDINR (SEPT)is trading above its major Exponential Moving Average indicating upward trend for short term view. The Pair has major support placed around 80.16 levels while on higher side resistance is seen around 81.50 levels. The 21-day Exponential Moving Average of the USD/INR is currently around 79.99. On the daily chart, the USD/INR has Relative Strength Index (14-day) value of 69.96.
One can buy at 80.50-80.60 for the target of 81.50 with the stop loss of 80.00.
GBPINR (SEPT)is trading below its major Exponential Moving Average indicating downward trend for short term view. The pair has major support placed around 90.14 levels while on higher side resistance is seen around 92.36 levels. The 21-day Exponential Moving Average of the GBP/INR is currently around 92.35. On the daily chart, the USD/INR has Relative Strength Index (14-day) value of 34.55.
One can sell at 90.10-90.20 for the target of 89.10 with the stop loss of 90.65.
EURINR (SEPT) is trading below its major Exponential Moving Average indicating downward trend for short term view. The pair has major support placed around 78.60 levels while on higher side resistance is seen around 80.44 levels. The 21-day Exponential Moving Average of the EUR/INR is currently around 79.98.On the daily chart, the USD/INR has Relative Strength Index (14-day) value of 40.43.
One can sell at 79.50-79.60 for the target of 78.50 with the stop loss of 80.05.
JPYINR (SEPT) is trading between its major Exponential Moving Average indicating sideways trends for short term view. The pair has major support placed around 55.40 levels while on higher side resistance is seen around 57.60 levels. The 21-day Exponential Moving Average of the JPY/INR is currently around 56.66. On the daily chart, the USD/INR has Relative Strength Index (14-day) value of 50.77.
One can buy at 56.50-56.60 for the target of 57.50 with the stop loss of 56.05.
Private sector lender Tamilnad Mercantile Bank opened at a minor discount of 2.94 percent to issue price on September 15, following lower-than-expected subscription to its initial public offer (IPO). The stock listed at Rs 510 on the BSE, and the opening tick on the NSE was Rs 495 against issue price of Rs 510 per share. The maiden public issue had seen a 2.86 times subscription during September 5-7, with qualified institutional investors buying shares 1.62 times the allotted quota, non-institutional investors 2.94 times and retail investors 6.48 times. The bank has mobilised Rs 831.6 crore through its initial public offering which was a fresh issue. Hence, the funds will be utilised for augmenting tier-I capital base to meet future capital requirements. The price band for the offer was Rs 500-525 per share. Tamilnad Mercantile Bank is one of the oldest banks with about 100 years of legacy. TMB focussed on diversifying product portfolio to access more client base. It continues to expand relationship banking facilities to increase network. It intends to focus more on fee-based products such as issuing debit cards, credit cards, insurance, online bill payment, DP services, etc.
Inox Green Energy Services, a subsidiary of Inox Wind, received market regulator Sebi's approval to float its Rs 740 crore IPO. According to the draft red herring prospectus (DRHP), the public issue by the company comprises fresh issuance of shares worth Rs 370 crore together with an offer-for-sale of equity shares aggregating to Rs 370 crore by promoter Inox Wind. The company filed draft IPO papers with the capital market watchdog on June 20 this year, after which its received the update an observation letter from the regulator on September 13. Sebi’s observation letter is suggestive of the regulator’s go ahead for the public issue. The proceeds garnered from the issue shall be put towards debt payment and general corporate purposes, according to the draft papers. Inox Green Energy Services is engaged in the business of providing long-term Operation and Maintenance (O&M) services for wind farm projects, specifically for Wind Turbine Generators (WTGs) and common infrastructure facilities on wind farms, which support the evacuation of power from such WTGs.
Automotive component company Divgi Torqtransfer Systems Ltd has filed preliminary papers with capital markets regulator Sebi to raise funds through an initial public offering (IPO). The IPO will comprise fresh issue of equity shares aggregating up to Rs 200 crore and an offer for sale (OFS) of up to 31,46,802 equity shares by investors and other selling shareholders, according to the draft red herring prospectus (DRHP). As part of the OFS, Oman India Joint Investment Fund II, Nrjn Family Trust, Bharat Bhachandra Divgi, Sanjay Bhalchandra Divgi, Ashish Anant Divgi, Arun Ramdas Idgunji and Kishore Mangesh Kalbag will offload shares. Proceeds from the fresh issue will be used towards funding capital expenditure requirements for the purchase of equipment for its manufacturing facilities and general corporate purposes. Divgi is an automotive component entity which has the capability to develop and provide system level transfer case, torque coupler, and Dual Clutch Automatic Transmission (DCT) solutions. It has three manufacturing and assembling facilities located across India. Mahindra & Mahindra, Tata Motors and Toyota Kirloskar Auto Parts are among the company's customers. Inga Ventures and Equirus Capital are the book running lead managers to the issue. The equity shares are proposed to be listed on BSE and NSE.
Mankind Pharma, the drug maker, known for Manforce Condoms and Prega News, has filed its draft red herring prospectus (DRHP) with market regulator Sebi for an initial public offering on Friday. According to bankers, the size of the public offer is expected to be Rs 5,500 crore. The company’s initial public offering comprises an offer for the sale of 4 crore equity shares by the promoters and existing investors. The offer for sale comprises up to 1 crore shares by promoter Juneja family, up to 2 crore shares by Capital International, up to 99.65 lakh by Beige, and up to 50,000 equity shares by Link Investment Trust. The ChrysCapitalbacked consortium of GIC of Singapore and CPP Investments owns 10% of Mankind, while Capital International owns another 11% stake. The company has hired JM Morgan, Citi, Jefferies, Axis, IIFL, and Kotak as investment bankers. The firm posted revenue of about Rs 8,000 crore and EBITDA of Rs 2,200 crore in FY22. Mankind's top over-the-counter (OTC) brands include pregnancy testing kit Prega News, emergency contraception Unwanted-21, AcneStar anti-bacterial gel, Ringout anti-fungal powder, Gas-O-Fast, Kaloree 1 artificial sweetener, Heal-O-Kind anti-bacterial ointment, Addiction Deodorant, and KabzEnd.
Inox Green Energy Services, a subsidiary of Inox Wind, is planning to come out with its Initial Public Offering (IPO) by October this year to raise Rs 740 crore to fund its expansion plans. The company will focus on the Indian market initially and plans to tap the overseas market after establishing itself in this country, Inox Wind Chief Executive Officer (CEO) Kailash Lal Tarachandani told PTI. Speaking to reporters during a visit to its plant in Rajmol, Gujarat, Tarachandani said the company is planning to launch its IPO "in the next 30 to 45 days". This is Inox Green Energy Services' second attempt to go public. In February, the company had filed the Draft Red Herring Prospectus (DRHP) for its proposed IPO with the markets regulator Sebi. However, the draft offer documents for the IPO were withdrawn in late April without disclosing any reason. According to the latest DRHP filed on June 17, the Rs 740-crore IPO will comprise fresh issuance of equity shares worth Rs 370 crore and an offer-for-sale of equity stocks aggregating to Rs 370 crore by promoter Inox Wind. Elaborating on the company's business plans, Tarachandani said: "There is already enough opportunity. India has been consistent in the last few years and has a positive growth story. From that perspective, we have been quite busy. I see that there itself is a huge potential."
Digit Insurance, a company backed by Canadian billionaire Prem Watsa’s Fairfax Group, has had a planned initial public offering (IPO) put on hold, a Securities and Exchange Board of India (SEBI) regulatory document showed. Founded in 2017, Digit is trying to expand in general insurance, touting customer service benefits including easier claim settlements. Separately, it is moving into the life insurance market with its Go Digit Life venture. The prospectus filed by the company last month showed the IPO will consist of new shares worth 12.5 billion Indian rupees ($158 million) while existing stakeholders will sell up to 109.4 million shares.
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ICICI Prudential Mutual Fund has launched the ICICI Prudential Nifty50 Equal Weight Index Fund. The scheme will invest in the constituents of the Nifty50 Equal Weight Index. The NFO opens on September 14 and closes on September 28. The scheme will be managed by Kayzad Eghlim and Nishit Patel. “Since indices perform differently under variable market conditions, it is prudent to diversify across indices with different weightage methodology. Nifty50 Equal Weight Index is less concentrated in the top 5 sectors as compared to the Nifty 50 Index, thus providing an excellent diversification opportunity. Also, there is no size bias as the index tries to reduce the impact of bigger companies on the index performance,” says Chintan Haria, Head- Product Development & Strategy, ICICI Prudent AMC. According to the fund house, the Nifty 50 Equal Weight Index invests in the top 50 stocks in India based on market capitalization. An equal weight index has empirically higher dividend yield as compared to a market capitalization weighted index as it allocates funds equally to its components. According to the press release, the scheme exhibits smart-beta characteristics as the index intends to have no size bias. The index is less concentrated and helps in providing stability to the portfolio.
Motilal Oswal Asset Management Company (MOAMC) has announced the launch of Motilal Oswal Gold and Silver ETFs FoFs, with an objective to generate returns by investing in units of Gold ETF and Silver ETF. The NFO will open on September 26 and closes on October 7. The Minimum Application amount for Motilal Oswal Gold & Silver ETFs FOFs is Rs 500 and in multiples of Re 1 thereafter. According to the press release, the scheme will generate returns by investing in units of Gold and Silver ETFs; the daily weights shall be market driven with the starting (NFO) allocation of 70:30. The maximum weight is capped at 90%, subject to quarterly review. The initial higher allocation to Gold is on account of it having higher economic value and being highly liquid. Additionally, it is relatively more stable as compared to silver.
SBI Mutual Fund has announced the launch of two equity index funds, further expanding its offerings in the passive segment. SBI Nifty Midcap 150 Index Fund and SBI Nifty Smallcap 250 Index Fund are open-ended schemes that would replicate the performance of the underlying indices - Nifty Midcap 150 Index and Nifty Smallcap 250 Index, respectively. The fund manager for the SBI Nifty Midcap 150 Index Fund and SBI Nifty Smallcap 250 Index Fund would be Harsh Sethi, who also manages other exchange-traded funds at the fund house. According to the press release, the investment objective of the scheme is to provide returns that closely correspond to the total returns of the securities as represented by the underlying index, subject to tracking error. The fund house says that the new scheme would be suitable for investors who are seeking long-term capital appreciation, through investments in securities covered by the Nifty Midcap 150 Index and the Nifty Smallcap 250 Index and gain access to the potential growth of the companies in the underlying indices.
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