Daily Market Update Apr 29

Untitled 5 Daily Market Update Apr 29

Previous Day Market

Sensex closed at 49733.84 up by 789.7 points
Nifty closed at 14,864.55 up by 211.5 points

SEBI has stipulated that all Asset Management Companies or AMCs must pay at least 20% of gross salary of KMPs or key management personnel as units of the scheme managed by them. According to SEBI, this would automatically align the interests of the fund manager with the interests of unit holders as they would have skin in the teeth. The circular will come into effect from 01st July. However, this will not apply to index funds, ETFs and overnight funds. KMPs have already been clearly defined by SEBI for this purpose.

Zomato, the online food ordering and delivery start-up, has filed with SEBI for its much-anticipated IPO. The IPO will be worth Rs.8,250 crore. Food delivery business has witnessed a surge amidst the first and the second wave of COVID-19 pandemic. Zomato already has backing from Ant Group of China. Zomato is present in 24 countries and employs over 5,000 people. Out of Rs.8250 crore, a sum of Rs.7,500 crore will be as fresh issue and the balance as OFS. Zomato will use the funds for organic and inorganic growth.

The recently listed Anupam Rasayan has just managed to scale a fresh 52-week high price of Rs.666. The stock rallied sharply after it secured an order worth Rs.1,100 crore from an MNC life sciences company. Anupam Rasayan IPO was issued at Rs.555 per share and was listed on 24 March. The order is to supply life sciences related speciality chemicals and it could be a game changer for Anupam Rasayan. The company already has over 53 global institutional customers. The stock is up nearly 20% over the IPO price.

It looks like another delay in Air India divestment as the pandemic is likely to put off the divestment process by a couple of months. This was disclosed by DIPAM secretary, Tuhin Pandey, although he did not disclose any firm dates. The government was originally targeting to complete the divestment of Air India in the first half of FY21, but could not get pushed to the second half. Also, the physical inspection of certain assets were not possible at this point. Shortlisted bidders must submit their final bids in next 2 months.

HDFC AMC stock price came under pressure due to consistent loss in market share. For example, its share in quarterly AUM fell from 17.2% in Dec-20 to 16.7% in Mar-21. Also, HDFC AMC’s share of the outstanding AUM fell sharply from 20.9% in FY20 to 15.7% in FY21. It has also lost share in terms of unique individual customers. This has put the company valuations under pressure. It may be recollected that Navneet Munoth, ex-CIO of SBI MF, had recently taken over as the CEO of HDFC AMC in the place of Milind Barve.

HDFC Bank plans to upgrade its legacy credit card system with a modern technology platform to make the processes more efficient and cost-effective. The idea is also to give customers a better experience after a series of technical flops in recent months. In December, the RBI had barred HDFC Bank from issuing new cards till its systems were put in place. HDFC Bank is currently in talks with fintech companies like Zeta and Sprinklr for launching their credit cards post the ban. HDFC is also a likely bidder for the Citi business.

Bajaj Finserv gained 4% after reporting 4-fold jump in net profits for the Mar-21 quarter. The consolidated top-line revenues stood at Rs.15,387 crore in the Mar-21 quarter, driven by the insurance and lending business, in that order. For FY21, the PAT came in sharply higher by more than 33% at Rs.4,470 crore. The profits were helped by lower asset impairment and also higher profits in the insurance business. Bajaj Finserv also declared a dividend of Rs.3 per share. General insurance business showed record net profits.

Steel companies like JSW Steel and others are reducing steel output to augment liquid medical oxygen supply. JSW alone is targeting 20,000 tons of LMO for the full month. SAIL was another steel manufacturer to effect a temporary shutdown to boost oxygen supplies. The government has restricted the industrial use of liquid oxygen to boost supplies for medical purposes. Most steel plants produce oxygen that is needed for enrichment in blast furnaces, apart from general factory purposes like lancing and gas cutting.

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%name Daily Market Update Apr 29

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