Daily Market Highlights Jul 23

1 Daily Market Highlights Jul 23

Previous Day Market

Sensex Closed At 52,837  up by 638.70 points 

Nifty Closed At 15,752  up by 191.95 points 

In an interesting move, Zomato decided to pull back its listing date to 23 July instead of 27 July, as was originally scheduled. It may be recollected that the price of the IPO was discovered at the upper end of the price band at Rs.76 per share. Zomato will be listed on the NSE and the BSE and it is expected to see a high level of interest on listing day. The issue had been subscribed 38.25 times with the QIB portion being subscribed 51.8 times. Zomato is backed by Ant group of China and is a leading food delivery portal.

Competition Commission of India or CCI accused Amazon of concealing facts and making false submissions when it sought approval for investment in Future Coupons, a unit of the Future Group. This adds a new angle to the ongoing legal battle between Amazon and Future group over sale of stake in Future Group to Reliance Retail. Amazon had demanded first right of refusal on account of its 49% stake in Future Coupons. CCI is of the view that Amazon did not disclose strategic interest in Future Retail while seeking approval.

Government confirmed that lawsuits by Cairn Energy and threat to attach assets of PSUs would not impact the divestment of Air India. Cairn Energy and Devas are seeking $1.73 billion and $1.20 billion respectively from India. Both have sought declaratory judgment against the assets of Air India as a government alter ego. Financial bids for Air India are expected to come in by 15-Sep. Cairn case pertains to capital gains on sale of Cairn India to Sterlite and Devas wants compensation for cancellation of the satellite deal in 2005.

On Thursday, Jindal Stainless stock rallied 19% after it had signed a MOU with Tata Steel Mining to jointly unearth chrome ore locked up in the boundary between their mines in Sukinda, Odisha. This will help in conservation of chromite ore which otherwise would have been left unmined and benefits both the companies as well as the state of Odisha. Jindal Stainless is the largest manufacturer of stainless steel in India with a capacity of 1.10 MTPA and scalable to 3.20 MTPA. JSL is up 75% in the last 3 months alone.

IDFC was up nearly 19% on Thursday to scale a yearly high of Rs.62.60 after RBI allowed it to exit as the promoter of IDFC First Bank. RBI has already announced that holding companies can exit their banking units after completion of 5-year lock in. IDFC currently owns 36.6% in IDFC First Bank. However, IDFC has not mentioned about its intent to exit IDFC Bank. What investors are really betting on is that now IDFC can be absorbed into IDFC Bank through reverse merger, which would enhance the value of IDFC group.

Bharti Airtel was up 4% at Rs.547 on 22 July after it announced new post-paid plans for corporate and retail customers. In line with intense data demands of WFH, the new post-paid plans offer data benefits backed by a 5G ready network. The plans also comes with benefits like bundled content and business productivity tools. This had become inevitable as the average data consumption per family had gone up sharply in the last one year due to almost all activities, including office work and schools, going online.

Airline companies are expected to deliver a tepid performance in the first quarter due to rising fuel costs and fall in traffic due to the second wave of COVID. Losses will be wider sequentially, but lower on a yoy basis. In fact, brokers are expecting the losses of industry leaders like Interglobe Aviation to more than double on a sequential basis. SpiceJet is also expected to post widening of losses even after considering the compensation from Boeing. Passenger traffic fell sharply while fuel costs of ATF were up by 11% QOQ.

Star Health has filed its DRHP with SEBI for its proposed IPO. Star Health is one of India’s leading health insurance provider. The insurer proposes to come out with a fresh issue of shares worth Rs.2,000 crore plus 6 crore shares by way of OFS. Some of the famous names backing Star Health include Westbridge Capital, Madison Capital and Rakesh Jhunjhunwala. The fresh issue will be used to augment its capital. The issue will reserve 75% for QIBs and just 10% for retail. Star will be the fourth private insurer to list.

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%name Daily Market Highlights Jul 23

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