KEY HIGHLIGHTS
Closing Bell
India's stock benchmarks declined 1% with Nifty snapping its longest winning streak in 21 months, but gained for the fifth week in a row, aided by FMCG and energy stocks.
Realty, FMCG, Media and I.T. stocks gained while PSU Banks and pharma stocks declined in the week.
On Friday, the Sensex fell over 650 points to 59,646.15, snapping a five-day winning streak.
The Nifty 50 also lost over 1% and snapped its longest winning streak (eight days) to close at 17,758.45. Today six of the Nifty 50 stocks advanced, while 44 declined. IndusInd Bank, Bajaj Finserv, Apollo Hospitals, Tata Motors and Tata Consumer Products were among the top laggards.
The broader indices mirrored their larger peers. Barring Power, Utilities and Teck, all the other 16 sectoral measures compiled by BSE declined with Realty losing 2%.
The market breadth is skewed in the favour of bears. About 1,426 stocks advanced, 1,981 declined and 121 remained unchanged.
Foreign Investors Net Buyers
FPIs returned as net buyers today after turning net sellers for day on Thursday.
Overseas investors snapped out of 13 days of net buying to turn net sellers on Thursday. It was the longest stretch of net inflows by FPIs in this year so far.
As per data from the National Stock Exchange, foreign portfolio investors net bought equities worth Rs 1,110.9 crore today.
On the other hand, domestic institutional investors net sold equities worth Rs 1,633.21 crore today.
Institutions have net bought Rs 11,917.57 crore worth of equities so far in August and net sold equities worth Rs 36,522.12 as yet in 2022.
Adani Group Makes Open Offer For Ambuja Cement, ACC
The Adani Group has made an open offer to acquire 26% stake in ACC for Rs 2,300 per share.
The open offer price for ACC is at a 2% discount to Friday’s closing price.
It has made an open offer to acquire 26% in Ambuja Cement for Rs 385 per share, a 8.3% discount to Friday’s closing price.
Both open offers to run from August 26 to September 9.
Source: Exchange filing
Disclaimer: Adani Enterprises is in the process of acquiring a 49% stake in Quintillion Business Media Ltd., the owner of BQ Prime.
10-Year Bond Yield Rises
Yield on the 10-year bond rose 6bps to 7.30% during the session before closing at 7.26%.
Source: Bloomberg
Rupee Falls Against U.S. Dollar
Indian currency depreciated 12 paise during the session before closing 10 paise lower at 79.78.
Source: Bloomberg
RBI Clarifies On A Recent Bulletin Article On Privatisation Of Public Sector Banks
The article is the opinion of its authors and not that of the RBI.
Researchers are of the view that instead of a big bang approach, a gradual approach as announced by the government would result in better outcomes.
The article states that gradual approach to privatisation adopted by the government can ensure that a void is not created in fulfilling the social objective of financial inclusion.
Source: RBI clarification
Adani Ports Surges On Introduction Of Draft Indian Ports Bill
June Quarter Earnings Review
PVR, Inox Leisure Fall As Advocacy Group Files Complaint With CCI
Shares of PVR Ltd., Inox Leisure tumbled 4.5%, 5% respectively.
The decline comes after Consumer Unity & Trust Society (CUTS) filed an information with Competition watchdog, urging it to investigate possible anti-competitive effects of proposed merger between Inox Leisure and PVR.
PVR and Inox Leisure are the top two players in film exhibition industry, in that order. Post the proposed merger, the entity could become the largest player in 43 cities and market share over 50% in 19 cities.
CUTS argues that such market power would lead to reduction in consumer choice, high pricing, deterioration in standards, high bargaining power.
“The CCI has a duty to prevent and eliminate practices having an appreciable adverse effect on competition, promote and sustain competition, and protect the interest of the consumers,” said Pradeep S Mehta, Secretary General, CUTS in a press statement on Thursday.
BQ Prime is awaiting response from PVR Ltd.
PVR-Inox merger does not need CCI approval since the deal does not meet the asset and turnover threshold that trigger a regulatory filing.
Source: CUTS C-CIER statement, Bloomberg
Havells India Falls Most In Two Weeks
Shares of Havells India fell nearly 2%, most in two weeks.
The decline comes after the company updated on the fire incident at its Neemrana plant in Rajasthan.
The company ascertained the book of assets affected due to the incident at around Rs 150 crore and said that the amount is fully insured.
It also added that there was no human loss/injury and the entire building, machinery and inventories were insured.
Of the 48 analysts tracking the company, 24 maintain 'buy', 16 suggest 'hold' and six recommend 'sell'. The return potential of the stock is 1.4%.
Source: Bloomberg, Exchange filing
European Markets Fall
Sun Pharma Falls After U.S. FDA Issued Form 483 Citing Procedural Lapses At Mohali Plant
Shares of Sun Pharmaceutical Industries fell 1.7% and are on course to extend losing streak for the second day.
The falls comes after the U.S. FDA flagged quality control and procedural lapses at the Mohali facility of Sun Pharmaceutical Industries Ltd.
The U.S. Food and Drug Administration conducted an inspection from August 3 to August 12, at Sun Pharma’s drug manufacturing facility in Mohali.
The U.S.FDA issues Form 483, with six observations. Form 483 is generally issued when the regulator observes violation of Food Drug and Cosmetic Act.
Sun Pharma said in an exchange filing that it is preparing to respond to the observations.
Of the 44 analysts tracking the company, 40 maintain 'buy', three suggest 'hold' and one recommend 'sell'. The return potential of the stock is 17&.
The Nifty Pharma index slid nearly 1% with 18 of the 20 constituents falling.
Source: Exchange filing, Bloomberg
CAMS Shares Down Most In 8 Weeks
Shares of Computer Age Management Services Ltd. fell as much as 4.3%, to the lowest levels in eight weeks.
Trading volume was nearly 63 times the average for this time of the day.
The company had about 3.8% of its equity or 18.6 lakh shares change hands in bunched trades. It was the second most traded Indian stock by .
Buyers, sellers weren't immediately known.
Bitcoin Drops 8.3% As Part Of Broader Crypto Selloff
Banks Shortlist 17 New Bad Loan Accounts For Transfer To NARCL
Loans worth more than Rs 93,000 crore shortlisted for potential sale to bad bank.
Loan accounts include SREI Group NBFCs, Future Group companies, Jaiprakash Associates, Jaypee Cement among others.
The 22 accounts shortlisted for sale earlier this year remain unsold to NARCL.
Source: People in the know
Banking Stocks Fall
Media Stocks Advance
IRCTC Gains As It Readies Plan To Monetise Digital Assets
Shares of Indian Railway Catering & Tourism Corp. jumped nearly 4% and are on course to extend winning streak for the fourth day.
Trading volume is nearly 10 times the 30-day average. The relative strength index on the stock is 84, suggesting it may be overbought.
The uptick comes after the company said that it is in the process of floating a tender to appoint a consultant to advise on monetisation of digital assets.
The ticket booking arm of Indian railways seeks to monetise its collection of passenger data and plans to raise Rs 1,000 crore through this exercise. The company had confirmed that it intended to monetise customer/vendor data to generate revenue and enhance its services, in its tender inviting bids. The company said in an exchange filing that it floated the tender to appoint a consultant, who will guide the company on monetisation of digital assets under IT Act 2000. It also added that the process is at an early stage and concrete outcome would only be known in due course of time.
Of the nine analysts tracking the company, three maintain 'buy', one recommends 'hold' and five suggest 'sell'. The return potential of the stock is -20%.
Source: Exchange filing, Bloomberg
Coforge, Tech Mahindra, Mindtree Surge
MTNL Surges Most In Over Three Weeks
Shares of Mahanagar Telephone Nigam Ltd. rose over 11.5%, most in over three weeks.
Trading volume is five times the 30-day average. Share price crossed above 200-day simple moving average, indicating potential upward price momentum.
The rise comes after the company approved termination the depository agreement with Bank of New York Mellon and delisting of MTNL's ADS (American Depository Shares) listed on OTCQX, New York from October 1, 2022.
The company's board also gave its nod to raise borrowing powers from Rs 30,000 crore to Rs 35,000 crore and issue sovereign guarantee bonds of Rs 17,571 crore as per the cabinet approval to revive MTNL.
Source: Exchange filing, Bloomberg
ONGC Gains Most In This Week
Shares of Oil & Natural Gas Corp Ltd. ros over 2.1%, most in this week.
The rise comes after the government hiked windfall tax on export of diesel to Rs 7 per litre from Rs 5 per litre. It also brought a Rs 2 per litre tax on ATF exports.
Trading volume is twice the 30-day average.
Of the 29 analysts tracking the company, 19 maintain 'buy', seven suggest 'hold' and three recommend 'sell'. The return potential of the stock is 23.6%.
Source: Finance Ministry notification, Bloomberg
Wipro Gains After Bagging Multi-Year Integration Contract From HM Treasury
Shares of Wipro advanced over nearly 1.5% after HM Treasury selected the company for service integration and management services.
Wipro and HMT will collaborate to enable end-to-end service integration services, from strategy, design, implementation and day-to-day coordination with HMT's vendors.
Of the 46 analysts tracking the company, 15 maintain 'buy', 13 suggest 'hold' and 18 recommend 'sell'. The return potential of the stock is -2.8%.
Source: Exchange filing, Bloomberg
10-Year Bond Yield Rises
Yield on the 10-year bond rose 3bps (0.4%) to 7.27% at the open.
Source: Bloomberg
Opening Bell: Sensex, Nifty Open Higher; Eicher Motors, ONGC Advance
India's stock benchmarks opened higher, aided by gains in power, information technology, auto, consumer durables stocks.
The S&P BSE Sensex rose 0.1% to 60,351.56. The NSE Nifty 50 advanced by similar magnitude to 17,968.65. Today 31 of Nifty 50 stocks advanced while 19 fell. Tech Mahindra, Eicher Motors, Kotak Mahindra Bank, ONGC and Ultratech Cement were among the top gainers.
The broader indices outperformed their larger peers with S&P BSE MidCap gaining 0.3% and S&P BSE SmallCap adding 0.5%. Thirteen of the 19 sectoral indices compiled by BSE Lt. advanced with Power gauge rising 0.7%.
The market breadth is skewed in the favour of bulls. About 1,675 stocks rose, 795 fell and 102 remained unchanged.
Global Cues
U.S. Dollar Index at 107.64
U.S. 10-year bond yield at 2.89% on Thursday
Brent crude up 0.01% to $96.6 per barrel
Nymex crude at $90.61 per barrel
SGX Nifty down 0.19% to 17,970 as of 6:13 a.m
Bitcoin down 2.13% to $22,917
Source: Bloomberg
Rupee Falls Against U.S. Dollar
Indian currency depreciated 9 paise (0.12%) to 79.77, at the open
Source: Bloomberg
Stocks To Watch
RIL/ONGC/Other Oil Stocks: The government hiked windfall profit tax on diesel to Rs 7 per litre from Rs 5. It also brought Rs 2 per litre tax on ATF exports after scrapping it in the last review. Tax on domestically produced crude oil cut to Rs 13,000 per ton from Rs 17,750.
IEX/NTPC/PFC/REC/Other Power stocks: Power System Operation Corporation has asked three power exchanges — IEX, PXIL and HPX — to restrict electricity trading by 27 discoms in 13 states having outstanding dues towards gencos, PTI reported.
Wipro: The company has been awarded a multi-year contract to deliver Service Integration and Management services to HM Treasury.
Adani Total Gas: The company reduced prices of PNG and CNG upto Rs 3.2 per SMC and Rs 4.7 per Kg respectively.
Metropolis Healthcare: The company’s Chief Executive Officer Vijender Singh has resigned and Nov. 30 will be his last working day.
Trade Set up For Friday
Sensex, Nifty Set To Fall; RIL, ONGC, IEX, NTPC, Power Stocks In Focus
US.. stocks rose after swinging between modest gains and losses as mixed economic and earnings reports failed to spark a broad conviction trade.
Moves across Japan, China and Hong Kong were fairly muted. S&P 500, Nasdaq 100 and European futures slipped after Wall Street shares posted a small gain on Thursday.
At 9:00 a.m., the Singapore-traded SGX Nifty--an early barometer of India's benchmark Nifty 50--traded 0.1% lower at 17,986 points.
Oil, gold and Bitcoin dropped. The dollar and bonds rose.
RECOMMENDED FOR YOU
POPULAR