Previous Day Market
Nifty closed at 15,790.45 up by 103.50 points
Sensex closed at 52,699.00 up by 392.92 points
At its 44th AGM, Reliance Industries announced Rs.75,000 crore outlay to green energy. It inducted Yasir Al-Rumayyan into the board of RIL and affirmed that the stake sale in Reliance O2C to Saudi Aramco would be completed in FY21. Green energy plans include building 4 giga factories focusing on solar, storage battery and green hydrogen. Jio also unveiled JioPhone Next in association with Google to be launched in Sep-21 targeting 30 crores 2G customers. Google Cloud will be the digital playground for Reliance Retail.
Sona BLW Precision IPO made a strong debut, listing at a premium of 25% to its IPO price. Against the issue price of Rs.291, Sona BLW listed with marginal gains but closed the day 24.7% higher at Rs.363. the stock got a boost from favorable market conditions and expected growth potential in the electric vehicles segment. Sona has long-standing relationships with Maruti, M&M, Volvo, and Jaguar. The other IPO listing of the day, Shyam Metalics also closed the first trading day at a premium of 30% to the IPO issue price.
The fall in US jobless claims by just 7,000 in the previous week, may be lower than expected. However, the cumulative figure of 411,000 is sharply lower than the levels of 900,000 in Jan-21. The unemployment level claims reflect the pace of layoffs. This ratio is expected to improve further with graded opening up of various states. With the fall in joblessness, many of the US states are aggressively cutting down on the $300 weekly Federal unemployment payment. Most states have withdrawn doles to the self-employed.
Adani group has struck its first coal from the controversial Carmichael project in Australia. They are likely to start shipping from next, as per schedule. This is likely to substantially assist Indian power plants to source cheap coal. However, due to environmental protests, several banks had refused to fund the coal project. The Carmichael project will produce 10 MT of coal annually. The company has also simultaneously developed a rail project to move the coal. Carmichael will be one more feather in the Adani energy plan.
Sugar company stocks rallied sharply on 24 June with price hikes ranging from 5% to 10%. Most sugar stocks including Balrampur, Dhampur, Avadh, Uttam, Dalmia Bharat, Dwarikesh, and Triveni Engineering rallied sharply on 24 June. The big story for sugar has been one of limited supply, robust export demand, and, of course, the ethanol blending story. Currently, while Brazil blends 48% of its sugar output into the ethanol blend, India has just about reached 7.3%. This is expected to touch a high of 20% by the year 2023.
RBI imposed conditions for NBFCs to pay dividends to shareholders from FY22. According to RBI, NBFCs to be eligible to pay dividends to shareholders, must meet minimum capital adequacy ratios and have a net NPA ratio of less than 6%. Any regulatory findings on divergence in classification and provisioning for bad loans will be factored, as will auditor qualifications. NBFCs that do not accept public funds can pay up to 60% of net income, while other NBFCs can pay 50%. This will apply to systematically important NBFCs.
SAT stayed penalties imposed by SEBI on Cairn India for making misleading announcements about the buyback of shares in 2014. However, SAT has been asked Cairn to deposit Rs.2.50 crore with SEBI within 3 weeks during the pendency of the appeal. According to the SEBI order, the buyback announcement made by Cairn India in January 2014 was misleading and designed to induce trading in the stock. While the SAT has asked SEBI to file a reply within 3 weeks, Cairn India and other directors named need to file a rejoinder.
Zydus Cadila received tentative approval from the USFDA to market Fingolimod capsules, for treatment of multiple sclerosis in the US market. It can market the product in the 0.25 mg strength. It already has USFDA approval to market in 0.5 mg strength. Fingolimod is a drug for the treatment of relapsing forms of multiple sclerosis. Zydus will manufacture the drug at its SEZ manufacturing facility in Ahmedabad. Zydus group now has 319 approvals and has already filed over 400 abbreviated new drug applications (ANDAs).
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