Sensex, Nifty Fall For Fourth Day; I.T., Pharma, Cushion Losses

Indian equity markets ended off the lowest point of the day but ended with declines for the fourth straight session, in-line with the global sentiment.

The S&P BSE Sensex ended 0.8% lower at 37,734 while the NSE Nifty 50 index fell 0.9% to 11,153.

This is the longest losing streak for the benchmark indices in nearly two months. Both Sensex and the Nifty have ended at their lowest level since August 5 this year.

I.T. and Pharma stocks cushioned the losses seen by the benchmark indices. Both sectoral indices were the only sectoral gainers in today's trading session. Both the indices ended with gains of 0.7% each. Top three gainers on the Nifty 50 index were I.T. stocks.

The top sectoral laggard today was the media index, ending lower by 2.6%, led by losses in Zee Entertainment, which was also the top laggard on the Nifty 50 index.

Other laggards were the Nifty Realty and the Nifty Auto index which ended over 1.5% lower. The Nifty Bank and Nifty Metal fell over 1%, while the FMCG index declined 0.8%.

Broader markets too recovered from the day's low but underperformed the benchmark indices yet again. The midcap index fell 1.5% while the smallcap index ended with losses of 1.7%.

India Volatility Index ended 4.9% lower at 21.1.

Market breadth remained in favour of the laggards. 1,382 stocks on the NSE ended with cuts while 458 managed to buck the trend.

• Among top gainers on the Nifty Smallcap index
• Gains as much as 9% to Rs 113.3
• Trades at the highest level since April 2019
• Has gained in three out of the last four trading sessions
• Today's volumes are quadruple its 20-day average
• Stock in overbought territory with Relative Strength Index (RSI) at 75
• Has gained 13% in the last four trading sessions
• Trading around its record high level of Rs 118.9 made during Monday's trading session
• All seven analysts tracking the stock have a buy recommendation
• The stock trades 18.3% higher than its 12-month consensus price target of Rs 92, implying a negative return potential

The company's Board of Directors have approved the sale and transfer of its B2B business on a going concern basis through a slump sale for a lump sum consideration to Manjushree Technopack.

The B2B business is engaged in manufacturing, marketing and sale of rigid plastic packaging solutions for sale, gift or supply to other business entities for packaging of products.

The company's B2B business contributed Rs 125 crore to the total turnover in FY20 which was 89.6% of its total turnover.

The cash consideration that the company will receive is Rs 92.5 crore, according to the exchange filing.

Shares are locked in an upper circuit of 5% at Rs 17.95.

• Among top laggards on the Nifty 500 index
• Falls as much as 10.7% to Rs 2,885
• Biggest single-day fall in six months
• Trades at the lowest level in over a month
• Down for the second straight day
• Has declined over 10% in the last two trading sessions
• Today's volumes are nearly triple its 20-day average
• Trades at its 50-Day Moving Average support of 2,840
• Has declined 20% from its 52-week high of Rs 3,600 on August 26, 2020
• All three analysts tracking the stock have a buy recommendation
• Return potential of the stock as per Bloomberg data is 32.8%

The company this morning announced the grant of an exclusive license to Tripoint Therapeutics LLC, U.S.A (Tripoint) to commercialise the Elepsia XR 1000 mg and Elepsia XR 1500 mg tablets.

Under the terms of the agreement, SPARC will be eligible to receive tiered royalties, ranging from 15% to 50% on net sales, the company said in an exchange filing.

Tripoint will be responsible for all U.S. regulatory submissions and payment of annual PDUFA fees for Elepsia XR 1000 mg and Elepsia XR 1500 mg.

The initial term of the agreement shall be five years and may be further extended as per mutual agreement between the parties, the company said.

Shares rose as much as 3.4% to Rs 174.65 and are among the few stocks gaining on the Nifty Smallcap index.

The drugmaker has set October 1 as the record date for eligible shareholders to issue bonus shares of the company.

The board in August had approved issue of bonus shares in the ratio of 3:1 or three shares of Rs 10 each for every one fully paid-up equity share of Rs 10 each.

The company has set the record date on approval from shareholders through a postal ballot.

Shares rose as much as 5% to Rs 2,985, post the announcement.

• Benchmark indices have a volatile first hour of trade
• Nifty, Sensex, Nifty Bank recover from day's low
• Nifty down 0.8% at 11,157
• Sensex down 0.7% at 37,769
• Nifty Bank down 0.1% at 21,334
• Nifty Midcap index down 2.7%
• Nifty Smallcap index down 3.7%
• India Volatility Index up 0.6% at 22.31
• Nifty Media and Nifty Realty are the top sectoral laggards; down 3.7% each
• Nifty Metal, Nifty PSU Bank and Nifty Auto down over 2%
• Nifty FMCG, Nifty I.T. and Nifty Pharma decline over 1% each
• TCS is the top Nifty gainer; up 0.7%
• Zee Entertainment is the top Nifty laggard; down 5.7%
• 44 out of the 50 Nifty constituents decline
• 1,570 stocks on the NSE decline while 146 trade with gains

The rupee has opened weaker in today's session, in-line with the weakness seen in the equity markets.

The currency began trading at 73.47 against the U.S. Dollar as compared to Monday's close of 73.40. The currency ended little changed on Monday.

Marginal inflows in the debt & equity markets, as well as excitement over IPOs will be supportive of the rupee, Bloomberg News reports citing a note from CR Forex.

Yield on the 10-year government bond opened at 6.02% as compared to Monday's close of 6.016%.

11 states plan to sell bonds worth Rs 13,000 crore in today's session.

A report from Steel Mint has suggested that the Ministry of Environment has asked Sarda mines to half operations, stating that the environment clearance given to it is invalid.

Sarda mines has long-term arrangements with the company.

In other news, the company also issued a clarification on Monday about news reports suggesting various transactions that it undertook between 2014-2016, saying that the transactions are routine business process and that it complied with all regulatory guidelines.

BloombergQuint has reached out to the company for a comment. The company is yet to revert on the same.

Shares fell as much as 8.5% to Rs 159.6, down for the sixth straight day. This is the longest losing streak for the stock since November 2018.

The Board of Directors at a meeting held on Monday approved the buyback of equity shares.

The company will buyback a maximum of 66.67 lakh equity shares, which is 9.22% of the total equity shares of the company.

The buyback price of Rs 105 per share is a 47% premium to Monday's closing price.

The aggregate buyback offer is worth Rs 70 crore, the company said in an exchange filing.

Shares gained as much as 10.2% to Rs 78, before cooling off. The stock currently trades 3.5% higher at Rs 73.25.

Shares of the glass-lined reactor manufacturer fell after the company's promoters announced plans to sell up to 28% stake through an Offer For Sale.

The promoters plan to sell up to 40.93 lakh shares, worth Rs 1,433 crore, the company said in an exchange filing.

Floor price of the OFS has been set at Rs 3,500 per share, a 33% discount to Monday's closing price. The base offer was for 25.71 lakh shares with an oversubscription option of another 15.22 lakh shares.

The OFS for non-retail investors opens today while that for retail participants opens tomorrow.

Promoters Pfaudler Inc, Millars Machinery and Urmi Patel are sellers in the OFS.

Shares are locked in a lower circuit of 10% - the biggest single-day fall in six months, at Rs 4,682.7. The stock is down for the fifth straight day and is trading at the lowest in over a month.

Indian equity markets have witnessed a minor rebound at the start of trade after benchmark indices fell over 2% on Monday. Global cues however, continue to remain subdued.

The S&P BSE Sensex opened 0.44% higher at 38,200 while the NSE Nifty 50 index opened 0.46% higher at 11,301. 47 out of the 50 Nifty constituents had declined in trade on Monday.

Most sectoral indices have opened flat but with a positive bias. Nifty Pharama has opened with gains of 0.8% while the Nifty I.T. has opened 0.4% higher. Most sectoral indices had declined between 3-4% on Monday.

Broader markets are subdued as they kickstart the trading day. Both Nifty Midcap and Nifty Smallcap have opened little changed.

429 stocks on the NSE have opened with gains while 1,123 stocks have opened with losses.

• Nifty: Sell 11,400 Call of the September 24 expiry in the range of Rs 40-42. Target of Rs 26-16 and stop loss of Rs 56
• Nifty Bank: Sell between 21,350-21,450 for target of 21,100-20,800 and stop loss of 21,550
• Buy Torrent Power September futures for target of Rs 329.5 and Rs 334 and stop loss of Rs 323.5
• Sell JSW Steel September futures for target of Rs 267 and Rs 262 and stop loss of Rs 273.6
• Torrent Power and JSW Steel are intraday recommendations

• GMM Pfaudler: Promoters to sell up to 40.93 lakh shares or 28% stake through an Offer for Sale. Floor price of Rs 3,500 per share is a 33% discount to Monday's closing. The total share sale amounts to Rs 1,433 crore. Base offer is for 25.71 lakh shares (17.59%) with an oversubscription option of 15.22 lakh shares (10.41%). The OFS for non-retail investors opens today while that for retail investors opens tomorrow. Sellers include Pfaudler Inc, Millars Machinery and Urmi Patel.
• JSPL: Clarified on media reports over certain transactions undertaken by the company between 2014-2016. The company stated that all transactions were routine business activities and all of them had proper underlying assets. The statement also said that it had fully complied with all regulatory guidelines at the time of these transactions.
• HSIL: Board approves share buyback of 66.67 lakh shares or 9.22% of total equity. The buyback price of Rs 105 per share is a 47% premium to Monday's closing price. The total buyback aggregates to Rs 70 crore. On full acceptance of maximum buyback offer, promoter stake in the company will rise to 59.38% from 53.91%.
• Ceat: Board to consider raising funds via NCDs on September 25.
• Angel Broking: Raises Rs 180 crore from 26 anchor investors ahead of its IPO. The issue opens for subscription today.
• Chemcon Speciality Chemicals: Issue subscribed 5.2 times on the first day. Institutional subscription at zero, non-institutional subscription at 1.24 times while retail subscription at 9.86 times.
• CAMS: Issue subscribed 0.82 times on day 1. Institutional subscription at 0.25 times, non-institutional subscription at 0.3 times while retail subscription at 1.4 times.

For details on the key stocks in focus, brokerage updates and F&O cues, click here.

Good Morning!

Indian equity markets fell the most in over three weeks on Monday, tracking weak global cues. The benchmarks fell over 2% each but the cuts were steeper in the broader markets.

All constituents of Nifty Auto, FMCG, media, metal, pharma and PSU bank indices ended with losses.

But futures are indicating a steady start to today's session. The Singapore-traded SGX Nifty, an early indicator of the Nifty 50 Index’s performance in India, rose 0.25% to 11,272 as of 7:55 a.m. on Tuesday.

The subdued global and market sentiment has had no impact on the flurry of IPOs hitting the market. Angel Broking's Rs 600-crore IPO is the third issue that will be open for subscription. The other two — Chemcon Specialty Chemicals and CAMS — subscribed 5.2 times and 0.8 times on the first day of bidding on Monday.

Asian markets have dipped this morning, following a weak session on Wall Street. Benchmarks in Australia, South Korea, China and Hong Kong are declining, while those in Japan are shut for a holiday for the second day.

Futures on the Dow Jones are trading 70 points lower at present. The index recovered from sessions lows on Monday but ended with cuts of 1.8%.

West Texas Intermediate crude rose 0.5% after a nearly 4% decline overnight. Gold traded at $1,913/Oz.

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