Sensex, Nifty Close Flat As Selloff In I.T. Stocks Offset Banking Stocks' Gains

India's stock benchmarks closed little changed after fluctuating between gains and losses in a volatile session, as gains in banking, consumer durables and power stocks were offset by losses in I.T., telecom and auto stocks.

The S&P BSE Sensex closed little changed at 58,250.26. The NSE Nifty 50 also closed flat at 17,353.50. Infosys Ltd. contributed the most to the index decline, decreasing 0.8%. Nestle India Ltd. had the largest drop, falling 2.6%. Today, 20 of 50 shares fell, while 30 rose.

The broader indices outperformed their larger peers with the S&P BSE MidCap rising 0.81% and S&P BSE SmallCap adding 0.55% respectively. Ten out of the 19 sectoral indices compiled by the BSE Ltd. advanced, with S&P BSE Power gaining 1.30%. On the flipside, S&P BSE Teck declined 0.75%

The market breadth was skewed in favour of bulls. About 1,820 stocks advanced, 1,359 declined and 164 remained unchanged.

“Domestic bourses witnessed modest contraction today mainly led by profit booking in IT and Auto stocks. Further, weak cues from global equities also weighed on investors’ sentiment. Textile stocks were in focus today as government approved PLI scheme worth Rs107bn for the sector”, wrote Binod Modi. The Head-Strategy at Reliance Securities added “market appears to be bit fatigue after sharp rebound in recent weeks. However, we continue to believe that high frequency key economic indicators for Aug’21 indicate a sustained economic recovery on YoY comparison.”

Travel technology firm Oyo has begun talks with JPMorgan, Citi and Kotak Mahindra Capital to manage its IPO, Business Standard reports, citing unidentified people familiar with the matter. 

Oyo is expected to raise between $1.2b-$1.5b at a valuation range of $14b to $16b, Business Standard cites unidentified people close to the matter as saying.

• Adani Power Ltd. announced that its wholly-owned subsidiary Adani Power Maharashtra Ltd. has emerged as the successful bidder for the commercial mining of Gondkhari coal block in Maharashtra, Adani Power said in an exchange filing.

• Shares of Adani Power hit 5% upper circuit to Rs 97.75 apiece.

• Of the 3 analysts tracking the company, 2 maintained 'buy' and 1 maintained 'sell' recommendations. The overall consensus price of analysts tracked by Bloomberg implied a downside of 61.6%.

Goldman Sachs, JPMorgan, ICICI Securities, DSP Merrill Lynch and JM Financial are among the banks hired to manage India’s biggest initial share sale, according to the information released by the Disinvestment Ministry on Wednesday.

• Other names include Kotak Mahindra Capital, Citigroup Global Markets India, Nomura Financial Advisory & Securities (India), Axis Capital and SBI Capital Market.

• Names finalized from 16 investment banks that made pitches to the government.

• Banks will start engaging with investors from this month.

• Shares of Honeywell Automation India Ltd. rose nearly 4%, the most in 10 weeks, to Rs 41,699 apiece, higher than any close since August 4.

• Trading volume was 4,662 shares, about the same as the 20-day average.

• Honeywell Automation trades at 66 times its estimated earnings per share for the coming year.

• Analysts have five 'buy', one 'hold', and two 'sell' recommendations on the stock.

• Shares of HDFC Asset Management Co. Ltd. advanced 4%, the most in nearly 8 weeks to Rs 3,251 apiece.

• Trading volume was 2,30,294 shares, about the same as the 20-day average of 2,34,961 shares for this time of the day.

• The relative strength index on the stock was above 70, indicating it may be overbought.

• HDFC AMC trades at 47 times its estimated earnings per share for the coming year.

• Analysts have 15 'buy', seven 'hold' and two 'sell' recommendations on the stock.

• Cabinet Committee on Economic Affairs approved the increase of MSP for all mandated Rabi crops for Rabi Marketing Season (RMS) 2022-23.

• Increase in MSP is aimed at encouraging crop diversification.

• MSPs have been aligned in favour of oilseeds, pulses and coarse cereals.

• Return to farmers over production cost is estimated to be the highest for wheat, rapeseed, mustard, lentil, gram, barley, safflower.

• Increase in MSP of Rabi crops likely to ensure remunerative prices for farmers.

• Highest absolute increase in MSP over last year has been recommended for Lentil, Rapeseeds & Mustard, followed by Gram.

• Increase in MSP for Rabi crops in line with Union Budget 2018-19 announcement to fix MSPs at least 1.5 times of the all-India weighted average cost of production.

Source: PIB

• Shares of Alok Industries Ltd. added over 9% to Rs 25.40 apiece, higher than any other close since July 28.

• Trading volume was 25.86 million shares, triple the 20-day average of 7.24 million shares for this time of the day.

• Share price crossed above the 50-day simple moving average, indicating potential upward price momentum.

• The company's strategic activity over the past 3 months included 4 M&A deals and 1 investment.

• The rise in share prices of Alok Industries as well as other textile stocks like Trident, Grasim Industries came after the cabinet announced PLI scheme for textiles sector.

• Cabinet approves Production Linked Incentive to textile sector

• PLI in fiber, textile sectors worth Rs 10,683 crore over 5 years.

• PLI in textile sector is expected to lead to employment for about 7.5 lakh people directly.

• Higher priority will be given for investment in aspirational districts and tier 3/4 towns.

• Scheme expected to be a positive for states like Gujarat, Uttar Pradesh, Maharashtra, Tamil Nadu, Punjab, Andhra Pradesh, Telangana and Odisha.

Source: Cabinet Briefing

Shares of Caplin Point Laboratories Ltd. climbed over 4% to Rs 855 apiece after the company’s subsidiary Caplin Steriles Ltd. was granted final approval from the U.S. FDA for its Abbreviated New Drug Application (ANDA) Labetalol Hydrochloride Injection USP, 100 mg/20 mL and 200 mg/40 mL multiple-dose vials.

The injection is used to control blood pressure in patients with severe hypertension and it is a generic therapeutic equivalent of TRANDATE injection, of Sebela Ireland Ltd.

According to IQVIA, Labetalol Hydrochloride Injection had U.S. sales data of approximately $6 million for the 12-month period ending June 2021.

All the three analysts tracking the company maintained a ‘buy’ recommendation. The overall consensus price of analysts tracked by Bloomberg implied an upside of 24.9%.

Shares of Sun Pharmaceutical Industries Ltd. rose 1% to Rs 778.25 apiece. The company announced its foray into Nutrition Bar segment with the launch of Revital NXT. The product is a brand extension of Revital H, an health supplement.

Vidhi Shanghvi, Head, Sun Pharma Consumer Healthcare said that the Revital H was a bellwether of the nutritional supplement segment and the newest product Revital NXT bar will address the demand for on-the-go nutrition.

Of the 39 analysts tracking the company, 33 maintained ‘buy’, 3 maintained ‘hold’ and 3 maintained ‘sell’ recommendations. The overall consensus price of analysts tracked by Bloomberg implied an upside of 10.9%

India’s Directorate General of Trade Remedies has proposed an anti-dumping duty ranging between $65-$449 per ton on certain flat-rolled aluminum being imported from China, according to a notification issued on the final findings of an investigation.

A probe was initiated by the department under India’s Trade Ministry in September last year on the basis of complaints made by Hindalco Industries Ltd. on behalf of the local industry.

The local industry suffered material injury, with import volumes going up in relation to its consumption in the country and also resulted in price suppression.

“The volume of the subject goods has increased by more than 60% whereas demand has increased by only 18%,” the final findings said.

The local industry’s profits and return on capital employed have been negatively affected due to increased imports, it said.

India's stock benchmarks fell in a volatile session, dragged by I.T., auto and FMCG stocks.

The S&P BSE Sensex fell 0.32% to 58,090.55. The NSE Nifty 50 declined by similar magnitude to 17,305.30. Tata Consultancy Services Ltd. contributed the most to the index decline, decreasing 1.45%. Nestle India Ltd. had the largest drop, falling 2.8%. In midday trading, 26 of 50 shares fell, while 24 rose.

The broader indices outperformed their larger peers with the S&P BSE MidCap and S&P BSE SmallCap rising 0.3%. Eleven out of the 19 sectoral indices compiled by the BSE Ltd. declined, with S&P BSE IT declining 1%.

The market breadth was skewed in favour of bulls. About 1,713 stocks advanced, 1,329 declined and 167 remained unchanged.

Owl Ventures leads a $55 million funding round by Leap, whose platform helps students pursue international education.

• Harvard Management, Jungle Ventures and Sequoia Capital India also participated in the Series C round, Leap says in emailed statement

• Leap, which runs LeapFinance and LeapScholar, has raised more than $75 million in total.

Shares of Olectra Greentech Ltd. rose 5% for the second consecutive session, to Rs 343.20 apiece.

On Monday, the electric vehicle manufacturer outlined its future plans in a presentation to the institutional investor.

Olectra Greentech intended to expand capacity to 10,000 buses per year and to enter inter-city/inter-state private transport segment and staff transport private segment. The company also signing an MoU committing an investment of Rs 300 crore. The company has a total market share of 41% in FAME 1 & FAME 2 Electric Bus Tenders and NON FAME Electric Bus Tenders.

Nomura India Investment Fund bought 28.20 lakh shares (3.44%) of the company at Rs 321 per share, in a block deal. Promoter Goldstone Power sold 28.20 lakh shares (3.44%) at Rs 321 per share.

Stock price volatility over the past year has been 59.3% compared to overall company average of 48.1%

Shares of Maruti Suzuki India Ltd. shed 1.4% to Rs 6,781 apiece after the company reported production in August lower than in August, 2020.

In an exchange filing, Maruti Suzuki said that the production volume was affected due to electronic components shortage.

• Total passenger vehicle production was 1,11,368 units in August 2021 compared to 1,21,381 units YoY

• August passenger cars production at 70,973 units vs 90,746 units YoY

• August mini and compact sub segment production at 67,952 units vs 89,556 units YoY

• August Total Production at 1,13,937 units vs 1,23,769 units YoY

Of the 48 analysts tracking the company, 29 maintained ‘buy’, 8 maintained ‘hold’ and 11 maintained ‘sell’ recommendations. The overall consensus price of analysts tracked by Bloomberg implied an upside of 10.6%

Shares of MAS Financial Services Ltd. rose 3% at Rs 783.95 apiece after the company announced co-lending partnership with Bank of India for MSME loans, post market hours Tuesday.

In an exchange filing, MAS Financial Services said that the strategic, co-lending partnership with Bank of India for lending to micro, small and medium enterprises strengthened the decade-old relationship with the bank.

The partnership is expected to help MAS Financial Services to broaden its client base besides expanding credit flow to the unserved and under-served markets.

Of the three analysts tracking the company, two maintained ‘buy’ and one maintained ‘hold’. The overall consensus price of analysts tracked by Bloomberg implied an upside of 22.8%.

Shorter-term India sovereign securities gained in morning trading.

• The 4-year yield fell 0.9bps to 5.226%

• The 10-year yield fell 1bp to 6.185%

• The 14-year yield fell 0.5bps to 6.715%

• The 4-year-10-year yield spread was 95.9bps, vs previous close 95.9bps

Indian rupee declines for a third day amid corporate outflows and a stronger overnight dollar. Bond traders look forward to a Rs 17,000 crore ($2.3b) sale of Treasury bills.

USD/INR up 0.3% to 73.6150; pair rose 0.4% on Tuesday.

USD/INR could not break 72.95 and has again started rising, says Anil Kumar Bhansali, head of treasury at Finrex Treasury Advisors

• For the moment importers to take a back seat and exporters to keep selling the good uptics for pair as importers will again get a chance to buy dollars.

• Asian currencies have also fallen from their recent highs. Equities are still on the higher side but may fall in the next few days.

• USD/INR may trade in 73.40 to 73.70 range for session.

Shares of Wipro Ltd. shed 1.44% to Rs 664.55 apiece. The company announced a partnership with Securonix to deliver managed security services. The partnership brings Securonix’s cloud-first Security Information & Event Management (SIEM), analystics-driven detection and automated response tools with Wipro’s global reach and cybersecurity capabilities to provide improved governance and security threat protection, Wipro said in an exchange filing post market hours Tuesday.

Wipro aims to improve cyber organizational effectiveness, resiliency of its businesses through the partnership. Securonix delivers SIEM (Security Information & Event Management), UEBA, XDR and vertical-specific applications as a pure SaaS solution and is built on big data architecture.

Of the 48 analysts tracking the company, 16 maintained ‘buy’, 18 maintained ‘hold’ and 14 maintained ‘sell’ recommendations. The overall consensus price of analysts tracked by Bloomberg implied a downside of 14.8%

Yes Bank move to seek change in directors, MD of Dish TV followed concerns around governance standards, according to people familiar with the matter.

• Yes Bank has concerns over Rs 1000 crore rights issue announced in June.

• Bank believes board is unfit.

• Yes Bank expects support of other large shareholders for its proposal.

• Bank move is intended to protect the value of collateral.

• Attaching property and other assets to recover dues was not seen as enough.

• Dish TV owes over Rs 6,000 crore to banks.

Source: People Familiar With The Matter

Shares of Bharti Airtel Ltd. advanced nearly 2% to record Rs 683.80 apiece. The rise amid reports that the government is mulling a four-year moratorium on the yearly adjusted revenue and lower spectrum charges..

According to newspaper reports, proposals such as reduction in bank guarantees, option to convert a part of company’s dues to equity after four years and provision to surrender unused spectrum are being considered. Discussion on relief package for the sector may be discussed in the cabinet meet scheduled later today.

S&P BSE Telecom sector was the top sectoral gainer, adding 1.1% with 12 of the 13 constituents advancing in trade.

Shares of Ramkrishna Forgings Ltd. rose 4.78% to Rs 1,023.70 apiece after the company bagged first export order worth Rs 130 crore from an OEM in CIS (Commonwealth of Independent States) country.

In an exchange filing, the company said that the order was for a period of 3 years. Commenting on the order win, Naresh Jalan, Managing Director at Ramkrishna Forgings said that order marked the beginning of a long-term relationship with a new customer in a new geography and also reinforced the confidence on the expansion of international business.

All the three analysts tracking the company maintained ‘buy’ recommendation, the overall consensus price of analysts tracked by Bloomberg implied a downside of 1.5%.

Shares of Vidhi Specialty Food Ingredients Ltd. climbed 8.23%, the most in nearly two weeks, to Rs 364.45 apiece after the company embarked on a green initiative by setting up a 2 Mega Watt Solar Power Plant in Akola district in Maharashtra.

In an exchange filing post market hours Tuesday, the company estimated the total cost of the project to be approximately Rs 9 crore (including land) and said that the project will be funded fully by internal accruals.

The move will help Vidhi Specialty to reduce carbon emission and support the green energy requirements for its manufacturing units. The solar foray would also enable to company to significant cut cost and improve operational efficiencies, provide ample scope for margin expansion in the long run, the company said.

Shares of PSP Projects Ltd. rose 2.75% to Rs 455.90 apiece after the company received Letter of Intent (LoI) for projects worth Rs 132.57 crore, excluding GST.

In an exchange filing post market hours Tuesday, the company said that the projects pertained to Industrial and Precast segment from different clients in Gujarat.

All the nine analysts tracking the company maintained a ‘buy’ recommendation. The overall consensus price of analysts tracked by Bloomberg implied an upside of 25.2%

Shares of EID Parry India Ltd. rose 2.5% to Rs 414.25 apiece after the company approved the setting up of a 120 KLPD grain/sugar syrup/molasses based distillery at the company’s Sankili unit in Andhra Pradesh.

The proposed capacity is expected to be added by November 2022 and it requires an estimated investment of Rs 92.50 crore.

In an exchange filing, the company said that the investment is intended to avail the ethanol blending opportunity and increase foray into ethanol production. The proposed distillery will utilize sugarcane juice/syrup as the principal feedstock during the cane crushing season and grains like broken rise/maize/bajra during the off season to manufacture ethanol.

All the three analysts tracking the company maintained a ‘buy’ recommendation. The overall consensus price of analysts tracked by Bloomberg implied an upside of 32.1%

Shares of Setco Automotive Ltd. advanced nearly 10% to Rs 20.25 apiece after India Resurgence Fund (IndiaRF) announced investment of up to Rs 615 crore in the company, post market hours Tuesday.

India Resurgence Fund is backed by Piramal Enterprises and Bain Capital Credit.

According to a statement by IndiaRF, the transaction will be carried out in a two-step process with Setco Automotive transferring its clutch business into its subsidiary Setco Auto Systems Pvt Ltd.

The investment proceeds will be used for growth capital and to provide working capital to enable the businesses of the subsidiary Setco Auto Systems to utilise growth opportunities on the back of the anticipated recovery in commercial vehicles market, replacement market and to refinance/repay debt facilities.

Trading volume was nearly 6.1 times the 30-day full-day average

India's stock benchmarks opened little changed, as gains in telecom and consumer durables stocks were offset by losses in I.T., power and metal stocks, amid mixed global cues.

The S&P BSE Sensex remained largely unchanged at 58,359.65. The NSE Nifty 50 also remained flat at 17,370.30. Infosys Ltd. contributed the most to the index decline, decreasing 1.1%. Eicher Motors Ltd. had the largest drop, falling 1.8%. In early trading, 22 of 50 shares fell, while 28 rose.

The broader indices outperformed their larger peers with the S&P BSE MidCap and S&P BSE SmallCap gaining 0.2%. Ten out of the 19 sectoral indices compiled by the BSE Ltd. advanced, with S&P BSE Telecom adding 1.7%.

The market breadth was skewed in favour of bulls. About 1,380 stocks advanced, 734 declined and 117 remained unchanged.

Bengaluru-based machine parts maker Sansera Engineering Ltd.’s shareholders plan to sell as many as 17.24 million shares to raise about Rs 1,280 crore ($174 million) in an initial public offering, according to an advertisement in the Financial Express newspaper Wednesday.

• IPO includes offer for sale by investors Ebene Ltd. for up to 8.64 million shares and CVCIGP II Employee Ebene Ltd. for 4.84 million shares; founders will sell remaining shares, including Subramonia Sekhar Vasan offering 2.06m shares

• Investors can bid for minimum 20 shares of face value 2 rupees each in the sale, which opens Sept. 14 and closes Sept. 16

• Company makes machine parts for auto and aerospace industries and its customers include Maruti Suzuki, Bajaj, Toyota, Harley Davidson, Boeing, Volkswagen, Yamaha, Honda

• ICICI Securities, IIFL Holdings and Nomura Financial to manage IPO

Indian bond traders will look forward to a Rs 17,000 crore ($2.3b) sale of Treasury bills. Elevated U.S. treasury yields may weigh on the local bonds and the rupee.

• 10-year yields rose 2bps to 6.2% on Tuesday

• USD/INR rose 0.4% to 73.4125 on Tuesday

• Global funds sold net Rs 145 crore of India stocks Tuesday: NSE

  • They bought Rs 240 crore of sovereign bonds under limits available to foreign investors, and withdrew Rs 189 crore of corporate debt.

  • State-run banks bought Rs 445 crore of sovereign bonds on Sept. 7: CCIL data. Foreign banks bought Rs 1,280 crore of bonds.

Edelweiss Group announced that Ashish Kehair has been promoted to Managing Director and Chief Executive Officer of Edelweiss Wealth Management. He will lead the strategic initiatives and business operations at Edelweiss Wealth Management.

Ashish Kehair has served as Head of the EWM Wealth Management division since 2017.

Source: Exchange filing by Edelweiss Financial Services Ltd.

Shares of Indian telecommunications service providers may move after a newspaper report said the government is mulling a four-year moratorium on the yearly adjusted revenue and lower spectrum usage charges.

• Proposals also include a reduction in bank guarantees, an option to convert a part of a company’s dues to equity after four years and a provision to surrender unused spectrum, The Economic Times reported citing an unidentified government official

• Biocon Ltd. and its subsidiaries Biocon Pharma Ltd. and Biocon Pharma Inc have entered into a confidential settlement pact with Celgene Corporation, a wholly owned subsidiary of Bristol Myers Squibb.

• The pact is related to the patents for Revlimid (Lenalidomide).

Source: Exchange Filing by Biocon

Asian stocks were mixed on Wednesday after a dip in U.S. shares on concern that the delta coronavirus variant is slowing the economic recovery from the pandemic.

Japanese shares edged up but Australia and South Korea retreated. U.S. futures fluctuated after the S&P 500 fell and the Nasdaq 100 climbed to a record as investors sought more defensive areas of the market. Chinese technology equities listed in the U.S. jumped on bets that the worst of Beijing’s regulatory crackdown has passed.

India’s SGX Nifty 50 Index futures for September delivery rose 0.3% to 17,437.00, while MSCI Asia Pacific Index gained 0.2%. The NSE Nifty 50 Index fell 0.1% on Tuesday to 17,362.10.

A selloff across bond markets has intensified in part due to a flood of debt sales. The 10-year U.S. treasury yield trimmed an advance but remained above 1.36%. Strategists are now evaluating how long a recent bout of yield-curve steepening might last. The dollar held a rally.

Crude oil steadied after a two-day decline. Bitcoin nursed losses amid El Salvador’s rocky implementation of a law that makes the cryptocurrency legal tender.

Back home, Windlas Biotech is scheduled to report earnings on Wednesday. Ashok Leyland, Can Fin Homes, India Cements among companies holding annual shareholders’ meeting. Foreign investors bought net Rs 420 crore of stocks on Monday, according to NSDL website.