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Market Today with EZWealth – 11 Oct 2021
[/vc_column_text][/vc_column][/vc_row][vc_row][vc_column][vc_column_text]The Nifty50 Index scripted history by hitting the 18,000-mark in the intraday trade on Monday for the first time ever. The 50-share index got major support from auto and power stocks as the Nifty50 top gainers around 11 have remained the shares from these two spaces. Tata Motors, Coal India, NTPC, Maruti and Power Grid soared maximum to push the index beyond the 18,000-mark.
Meanwhile, the S&P BSE Sensex is also up 0.56% at 60,393.68, up 334.62 points amid the Nifty-50 story today.
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1) Prime Minister Narendra Modi will on Wednesday launch the digital platform for the first ever National Infrastructure Masterplan, through which the entire network of projects – from roads and railways to telecom networks and gas pipelines – until 2020, with plans up to 2024-25, will be laid out.
The masterplan, called PM GatiShakti, was announced on Independence Day and will bring together 16 ministries, including seven core infrastructure sectors, on one platform to synergise project planning across stakeholder ministries to avoid duplication, expedite clearances and plug gaps at the right time.
The GatiShakti platform will provide that information instantaneously, allowing for better coordination. A roads project and a gas pipeline project may be able to seek clearances together. Essentially, officials said, multiple infrastructure projects can be simultaneously planned and executed with minimum repetition and physical on-ground disruption.
2) Offshore bondholders of beleaguered developer China Evergrande Group were on Monday bracing for news on more than $148 million in looming bond coupon payments after the company missed two coupon deadlines last month. Expectations that the company will make the semi-annual payments on its April 2022, April 2023 and April 2024 notes due October 11 are slim as it prioritises onshore creditors and remains silent on its dollar debt obligations.
That has left offshore investors worried about the risk of large losses at the end of 30-day grace periods as the developer wrestles with more than $300 billion in liabilities.
Trading in shares of Evergrande, as well as its Evergrande Property Services Group unit, has been halted since October 4 pending a major deal announcement. On Monday, the company’s electric vehicle unit swung between large losses and gains, falling as much as 4.65 per cent and rising to 9.28 per cent.
3) Semiconductor shortages that prompted the closure of vehicle manufacturing factories have reduced Maruti Suzuki’s market share to one of its lowest levels in a month, as per sale data shared by each company for September.
At 33.95 percent, the Delhi-based company’s market share in the domestic passenger vehicle segment in September marked a sharp decline from the usual 46-50 percent share that Maruti Suzuki has enjoyed in the past. An acute crunch in chip availability at the global level has hit every automaker across each segment. The impact has been the most severe on Maruti Suzuki. October is the third month in a row that production at the car market leader’s plants is less than planned.
October production for Maruti Suzuki is expected to be 40 percent less than its normal level, but better than the September level.
4) India’s coal ministry said there is sufficient amount of the fuel to meet the demand of power plants and concerns about electricity disruption are misplaced, pushing back after Delhi Chief Minister Arvind Kejriwal warned Prime Minister Narendra Modi of an energy shortage in the capital. The coal dispatches were constrained due to a prolonged monsoon, the ministry said in a statement Sunday. Power plants have 7.2 million tons of coal reserves that can last four days and Coal India Ltd., a supplier to such stations, has a stock of 40 million tons, the ministry said. The average coal requirement at power plants is about 1.9 million tons per day, compared with supply of around 1.8 million tons a day, it said. Coal-based power generation in India this year rose by almost 24% as of last month helped by “robust supply” from companies providing the resource, according to the government. “Any fear of coal stocks depleting at the power plant end is erroneous,” the ministry said. “Domestic coal supplies have supported power generation in a major way despite heavy monsoons, low coal imports and a steep hike in power demand due to economic recovery.”
5) Shares of Aditya Birla Sun life AMC listed flat at ₹ 712 on the BSE on Monday, the same as the issue price of ₹ 712. The company had fixed the issue price at ₹ 712 at the upper end of the price band at ₹ 695-712. On the NSE, it opened at ₹715. Maket cap of Aditya Birla Sun Life stands at ₹ 20,500 crore. The 2,768-crore IPO was subscribed 5.25 times with the quota for qualified institutional investors subscribing more than 10 times. Retail institutional investors was subscribed 3.23 times. The quota for non-retail investors or HNIs was subscribed by 3.23 per cent. The portion reserved for Aditya Birla Capital shareholders got bids for 1.52 times.
6) Credit growth turned positive year-to-date (YTD) at 0.1 per cent in September for the first time in 2021-22 (FY22), reflecting gradual pick-up in demand.
According to the Reserve Bank of India (RBI) data, bank lending rose Rs 7,283 crore till September 24, against a contraction of 1 per cent (or Rs 99,280 crore) on a YTD basis in the same period last fiscal year (2020-21). Outstanding bank credit stood at Rs 109.56 trillion as on September 24.
What stands out this time around is that positive growth happened despite a more debilitating impact of the second wave of the Covid-19 pandemic. In a normal year, YTD growth in bank credit turns positive in August-September, ahead of the busy season in the second half which starts in October. In 2019, YTD growth had moved into positive territory in early October
7) India’s two listed oil explorers have outperformed the benchmarks over the past few months to hit multi-year highs, deriving optimism from higher crude and gas prices that have prompted earnings upgrades. In the last one month, Oil & Natural Gas Corp.’s adjusted earnings per share estimates for FY22 and FY23 were upgraded by 4.7% and 10.9%, respectively, according to forecasts compiled by Bloomberg. For Oil India Ltd., they were raised 24.3% and 19.6%.
That comes as the Brent crude hit a three-year high at $82.6 a barrel after OPEC decided to stick to a plan of slow-and-steady supply increases. Asia’s benchmark for oil has gained more than 55% so far in 2021. ICICI Direct expects it average $72.9 in FY22 and $70 in FY23. India, too, increased the administered price of natural gas by 62% to $2.9 a million metric British thermal unit for the second half of the ongoing fiscal. The price of gas from difficult fields was also raised by 69.3%. UBS expects a further increase in FY23 to $4.7–5.7 a unit.
Higher crude oil and gas prices are also expected to improve net realisations—the price earned after subsidies—for the oil producers. ICRA in its September report said the domestic crude production is expected to increase by about 2-3 million tonnes over the medium term from 30 million tonnes in FY21. Domestic gas production is also likely to go up. It expects overall credit protection metrics of domestic upstream companies to remain healthy over the medium term.
8) The Rs 18,000-crore acquisition of Air India by Tata Group could weigh on listed aviation stocks, given the worries that a strong No. 2 player could intensify competitive pressures for the sector. The combined market share of Air India, AirAsia, and Vistara as of August is 26.7 per cent.
While the near-term impact may not be severe, most analysts and industry experts believe that in the medium-to-long term, the sector could see a fight for market share brough on by the entry of multiple players. Among the new entrants is the Jalan-Kalrock consortium expected to start domestic flights by the first quarter of 2022. Rakesh Jhunjhunwala backed Akasa is also expected to start operation by April next year
Stocks in the news:
Cadila Healthcare: Fortress Biotech partner company Cyprium Therapeutics, with support from its licensing partner Sentynl Therapeutics, has announced positive results from an efficacy and safety analysis of data integrated from two completed pivotal studies in patients with Menkes disease treated with CUTX-101, copper histidinate.
Jubilant Ingrevia: To acquire of 26.60% stake in AMP Energy Green Fifteen for Rs 5.11 crore. The acquisition is expected to be completed in six months. The company has acquired stake in AMP to put up solar power plant with capacity of 15.5 MW under captive scheme.
Equitas Small Finance Bank: Provisional Q2 FY22 CASA Ratio at 45% compared to 40% in Q1. Total deposits up 6% at Rs 18,094 crore Vs Rs 17,095 crore. Gross Advances at Rs 18,981 crore Vs Rs 17,837 crore.
Bharti Airtel Ltd. unveiled a cashback offer on over 150 budget smartphones from leading brands ahead of billionaire Mukesh Ambani’s Reliance Jio Infocomm Ltd. introducing its Google co-engineered budget handset before the Hindu festival of Diwali in November. To avail the 6,000 rupees ($80) cashback on smartphones priced as much as 12,000 rupees, a customer will need to buy a so-called prepaid mobile services pack of 249 rupees or above continuously for 36 months, India’s No.2 wireless phone operator said in a statement Friday. The customer will receive the cashback in two parts – 2,000 rupees after 18 months and 4,000 rupees after 36 months.
Bharti Group’s subsidiary OneWeb will be the first private player to launch satellites from Indian soil through ISRO facilities, Bharti Enterprises chairman Sunil Bharti Mittal said today. “OneWeb will be the first customer which starts to bring a commercial position into the Indian space market,” Mittal said while speaking at the launch of space and satellite companies body Indian Space Association.
The shares of Sterling and Wilson Solar Ltd (SWSL) recorded fresh highs during the early trade on Monday after Reliance New Energy Solar Ltd, a wholly-owned unit of Mukesh Ambani-led Reliance Industries Ltd, announced plans to buy a 40 per cent stake in the Shapoorji Pallonji-backed company for ₹ 2,845 crore.
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