In the week gone by, global stock markets were mixed. Actually earnings remained in focus as investors analyzed the latest results and statements from companies to better understand how inflation is affecting businesses and consumers. No doubt, the second-quarter earnings season has helped markets bounce back from concerns around the fallout of the Ukraine war, soaring inflation, flare-up in China COVID-19 cases and an aggressive increase in interest rate by central banks. On the data front, the number of Americans filing new claims for unemployment benefits increased, suggesting some softening in the labor market. While the services sector, which makes up the bulk of the U.S. economy, unexpectedly grew in July. Central bankers across the globe continue to talk tough about inflation, but markets have largely moved on from worries about rising prices as the risk of over tightening and recession has come into greater focus. The Bank of England raised interest rates by the most in 27 years, despite warning that a long recession is on its way, as it rushed to smother a rise in inflation which is now set to top 13%. Investors across the globe are watching for potential economic fallout from China after U.S. House Speaker Nancy Pelosi’s visit to Taiwan. The data on the jobs market could help investors determine how the Federal Reserve will move ahead with its interest rate policy, which has been aggressive in an effort to try and tame inflation.
Back at home, domestic market remained upbeat on the back of better than expected earnings and expectation of peak out in inflation due to easing commodity prices. In the recent RBI meeting, as expected RBI hiked repo rate by 50 basis points to 5.4% and the Standing Deposit Facility (SDF) stands adjusted to 5.15%. Besides, the Governor also announced that the FY23 GDP growth forecast has been retained at 7.2%. While RBI retains CPI inflation forecast at 6.7% for FY23; July-September at 7.1%. On the data front, India’s manufacturing activity in July expanded at the quickest pace in eight months on the back of new business orders and output. S&P Global India Manufacturing Purchasing Managers' Index (PMI) jumped to 56.4 in July from 53.9 in June. Going forward, market will continue to take direction from global as well as domestic cues. It is expected that if buying by foreign Players continue, the market may continue to remain buoyant.
On the commodity market front, some weak data along with marginal buying in dollar index exerted pressure in commodities and CRB closed weak. Oil's demand outlook has been clouded by rising fears of an economic slump in the United States and Europe, debt distress in emerging market economies, and a strict zero COVID-19 policy in China, the world's largest oil importer. Furthermore, OPEC+ agreed to increase production by 100,000 barrels per day in September, far lower than previous months' production. The global energy market still faces supply shortages. Crude is expected to trade in a range of 6600-7400 levels. Gold can see buying on every dip and it should move in the range of 51000-53000 levels. Inflation Rate of Mexico, China and Germany, Core Inflation Rate, PPI, Michigan Consumer Sentiment Prel and Inflation Rate of US, New Yuan Loans of China, GDP Growth Rate of UK, etc are few important data scheduled this week, which can give significant impact on commodities prices apart from other triggers.
SMC Global Securities Ltd. (hereinafter referred to as “SMC”) is a registered Member of National Stock Exchange of India Limited, Bombay Stock Exchange Limited and its associate is member of MCX stock Exchange Limited. It is also registered as a Depository Participant with CDSL and NSDL. Its associates merchant banker and Portfolio Manager are registered with SEBI and NBFC registered with RBI. It also has registration with AMFI as a Mutual Fund Distributor.
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SAFE HARBOR STATEMENT: Some forward statements on projections, estimates, expectations, outlook etc are included in this update to help investors / analysts get a better comprehension of the Company's prospects and make informed investment decisions. Actual results may, however, differ materially form those stated on account of factors such as changes in government regulations, tax regimes, economic developments within India and the countries within which the Company conducts its business, exchange rate and interest rate movements, Impact of competing products and their pricing, product demand and supply constraints. Investors are advised to consult their certified financial advisors before making any investments to meet their financial goals.
The company is expected to benefit from the strong recovery in commercial vehicles and sign of recovery in 2W. Besides, the improvement in the supply of semiconductor and supply chain issue together with company’s expansion plans indicates revenue growth visibility. Thus, it is expected that the stock will see a price target of Rs.602 in 8 to 10 months’ time frame on current P/BVPSx of 8.64x and FY23 BVPS of Rs.69.64.
The company has strong order books reflecting future growth visibility. The management has informed that 80% land clearance for 5 projects are in place thus expecting smooth project execution of these projects. The management has guided 15% revenue growth in FY23 and margin pressure to ease with ease in the steel prices and all the projects have escalation clause. Thus, it is expected that the stock will see a price target of Rs.295 in 8 to 10 months’ time frame on current P/BVPSx of 1.94x and FY23 BVPS of Rs.152.31.
The stock closed at Rs 1101.35 on 05th August, 2022. It made a 52-week low at Rs 856.25 on 15th June, 2022 and a 52-week high of Rs. 1591.95 on 17th January, 2022. The 200 days Exponential Moving Average (DEMA) of the stock on the daily chart is currently at Rs 1120.73
Short term and medium term bias are looking positive for the stock as it has recovered sharply from lower levels. Apart from this, it has formed an “Inverse Head and Shoulder” pattern on weekly charts and has tried to give the breakout of same along with high volumes, but its consolidation indicates that there will be a strong spurt in coming days. Therefore, one can buy in the range of 1075-1085 levels for the upside target of 1200-1230 levels with SL below 1020 levels.
The stock closed at Rs 253.25 on 05th August, 2022. It made a 52-week low of Rs 206.00 on 01st July, 2022 and a 52-week high of Rs 440.75 on 11th April, 2022. The 200 days Exponential Moving Average (DEMA) of the stock on the daily chart is currently at Rs 304.33
After registered yearly low, the stock has recovered sharply and trading in rising channel on daily charts. Apart from this, the stock is forming an “Ascending Triangle” pattern on weekly charts and is trying to give the breakout pattern with decent volumes. So, follow up buying may continue in coming days. On the indicators front such as RSI and MACD, these are suggesting buying for the stock. Therefore, one can buy in the range of 252-254 levels for the upside target of 280-290 levels with SL below 238 levels.
Disclaimer : The analyst and its affiliates companies make no representation or warranty in relation to the accuracy, completeness or reliability of the information contained in its research. The analysis contained in the analyst research is based on numerous assumptions. Different assumptions could result in materially different results.
The analyst not any of its affiliated companies not any of their, members, directors, employees or agents accepts any liability for any loss or damage arising out of the use of all or any part of the analysis research.
SOURCE: RELIABLE SOFTWARE
Charts by Reliable software
On Friday, RBI announced hike in key rates which had been already discounted in the market. On weekly chart, Nifty and banknifty closed in green. Nifty is trading above 17000 psychological level whereas banknifty in hovering around 38000 level. Implied volatility (IV) of calls closed at 17.09% while that for put options closed at 18.70%. The Nifty VIX for the week closed at 19.26%. PCR OI for the week closed at 1.37. In Nifty, the highest call open interest is at 17500 strike whereas on put side, it is at 17000 whereas in banknifty, highest call and put open interest is at 38000 for both options. This level will play important role in banknifty. On the daily chart, Nifty and Banknifty oscillators are moving towards overbought zone. In coming session, nifty is likely to trade in zone of 17200- 17700 levels whereas banknifty may trade in the zone of 37500-38500 levels. Buy on dip strategies can be followed in this week as rollover for August series is positive.
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**The highest call open interest acts as resistance and highest put open interest acts as support.
# Price rise with rise in open interest suggests long buildup | Price fall with rise in open interest suggests short buildup
# Price fall with fall in open interest suggests long unwinding | Price rise with fall in open interest suggests short covering
Turmeric (Sept) is likely to trade in range of 7100-7850 levels with bearish bias. Last week prices traded lower and breached the support of 7600 levels due to selling pressure and on report of better sowing. Now the support is at 7050 levels. Sufficient stocks and good sowing reports kept turmeric prices under pressure. The physical market witnessed thin activities as seasonally, demand for turmeric remains low during the rainy season and buyers from major consumption centres are staying away. They are buying turmeric as per their short-term demand. Fresh demand will appear after September. Good sowing is reported in south India in this season due to higher prices realized by the farmers last year. Currently, In Nizamabad, around 90% to 95% sowing has been completed. Overall sowing percentage will get cleared after the end of August 2022. Jeera future (Sept) prices declined last week and closed in red on profit booking after the sixth consecutive week gain. However, the trend is positive as lower mandi arrivals and less supply of Jeera as farmers and stockists were holding stocks, are also supporting the prices. Mandi arrivals of Jeera, at the all-India level decreased by 10% as compared with the previous month. Cumin seed market are witnessing moderate demand as the stockists, processors, traders as well as the exporters are seen hesitant to carry out buying at higher level. The support is seen at 23000 levels while resistance is at 25500 levels. Currently, prices were higher by 80% y/y on lower availability due to lesser jeera production in 2021/22 compared to previous year. As per fourth advance estimates released by Govt of Gujarat Jeera production is likely to fall by 45% to 2.22 lakh tonnes over the previous year due to lower sowings. Dhaniya future (Sept) prices declined second consecutive week due to higher arrival and lower demand. Now the prices may trade in the range of 10900-12300 levels. Coriander prices are witnessing selling pressure as buyers stayed away in anticipation of more fall in its prices. As per the market sources, the stocks of imported coriander are now a low the demand and prices of domestic coriander have picked up. The buyers from south India as well as the local processors have reduced their buying currently, that’s why coriander prices are steady. Currently, the prices are higher by almost 70% y/y due to lower crop estimates. India has imported about 11.5 thousand tons of dhaniya in till May’22 in year 2022 compared to 2.4 thousand tons of previous year.
Gold prices steadied at a one-month high, ahead of a much awaited U.S. jobs data, as a retreat in Treasury yields and growing recession fears supported the safe-haven metal and kept it on track for a third straight weekly rise. Gold continues to benefit from a combination of a weaker dollar that has been driven by falling U.S. bond yields as markets continue to price in peak inflation and a recession. The yield on 10-year Treasury notes slipped, reducing the opportunity cost of holding non-interest bearing gold. The dollar crept higher but struggled to recoup its losses after falling by its sharpest pace in two weeks. The market’s focus is now on monthly U.S. non-farm payrolls report for July due at 1230 GMT that could offer more clarity on the Federal Reserve’s aggressive tightening plans to combat inflation. Economists expect an increase of 250,000 jobs. A soft payroll number will support gold’s upward momentum as it is likely to result in another bout of dollar weakness as yields fall. Gold should continue grinding towards the $1,900.00 region in the coming sessions. The Bank of England raised interest rates by the most since 1995 in an attempt to smother surging inflation. Sino-U.S. tensions remained in focus after China fired multiple missiles near Taiwan, a day after U.S. House of Representatives Speaker Nancy Pelosi made a solidarity trip to the self-ruled island. Ahead in the week gold prices remains elevated and may trade in the range of 51200-53400. Silver may also trade in the range of 56000-60000 with higher volatility. Overall trend looks positive buying on dips advised.
Crude has seen fall from 7800 to 6971 last week as recessionary concerns were heightened US, Europe, and Asia showed that factories struggled for momentum in July. However, it saw a bounce from low as supply shortage concerns were enough to cancel out fears of slackening fuel demand. Oil prices have come under pressure whole week as the market fretted over the impact of inflation on economic growth and demand, but signs of tight supply kept a floor under prices. OPEC's meagre supply hike highlights the limited capacity the market has to handle further shortages. For September, OPEC+ is set to raise its oil output goal by 100,000 barrels per day. The hike is one of the smallest since OPEC quotas were introduced in 1982, OPEC data shows. The global crude oil markets remained firmly in backwardation, where prompt prices are higher than those in future months, indicating tight supplies. Supply concerns are expected to ratchet up closer to winter with the European Union sanctions banning seaborne imports of Russian crude and oil products set to take effect on Dec. 5. For now, signs of an economic slowdown capped price recovery. Recession worries have intensified following the Bank of England's warning of a drawn-out downturn after it raised interest rates by the most since 1995. Ahead in the week crude oil prices may trade in the range of 6700- 7400. Natural gas prices rebounded from the low. More buying momentum witnessed after the release of the EIA Weekly Natural Gas Storage Report, which indicated that working gas in storage increased. The weather forecast remains favorable for strong natural gas demand. Ahead in the week prices may continue to witness buying and remain in the range of 610-680.
Base metals may trade sideways with a positive bias as the market is hoping for more stimulus on infrastructure projects and to support the property market which could strengthen metals demand. But pressure may still stay, if the tension between China-Taiwan escalates and China's property markets remain weak in the longer run. In China, continued COVID-19 lockdowns amid weak manufacturing data deflated hopes that stimulus and infrastructure spending would significantly revive the world's second-biggest economy. However, falling crude oil prices on fears of an impending global recession could help offset inflationary risks in the economy and slow the pace of interest rate hikes which could provide some help to economic recovery and demand of industrial metals also. Copper may trade in the range 630-675 levels. A group of Chinese companies are investigating why a commodities storage site in the northern city Qinhuangdao is holding only one-third of the 300,000 tons copper concentrate, worth 5 billion yuan, they were financing, Bloomberg reported. Aluminum may trade in the range of 200-220 with a bearish bias. High production growth in China and falling demand in the rest of the world may result in a surplus in the global market in the second half and especially in the last quarter of this year. Zinc can trade in the range of 290- 325 levels. Top producer Glencore Plc warned that Europe’s energy crisis poses a substantial threat to zinc supply. Glencore has already suspended production at one of its zinc smelters in Europe, leading to a sharp drop in its metal output this year. Lead can move in the range of 172-185 levels.
Cotton prices surged up again on concerns over supply shortage. MCX cotton futures for Aug delivery jumped 13% W-o-W posted weekly high of 49250 on Thursday against the last week close of 43230 levels. However, prices lost most of its gains on Friday tracking reports of increased area under cotton for upcoming season and ruled at 46770 on Friday. About 117 lakh Ha was sown under cotton till 5th Aug compared to 111 lakh Ha of previous year, higher by 5% Y-o-Y. Ongoing sowing progress will be major factor to watch in coming week as there is forecast of heavy rainfall in Maharashtra and other part of central India and north India that will add worries to the farmers. Emerging possibilities of re sowing and yield losses due to incessant rainfall will support firmness in prices. Gains in cotton will be limited due to bleak demand prospects at higher levels. Millers have halted their operation due to hike in cotton prices and preferring hand to mouth buying. Cotton prices is likely to witness limited gains may face strong resistance near 50000 level. NCDEX cotton seed oil cake Sep futures prices traded mixed to higher found support near 2480 level and showed sharp recovery on improved buying interest. Increased demand due lower availability of green fodder followed by flooding like situation in major consuming centers is likely to support firmness in prices in coming days. Renewed buying is likely to be seen that may push prices up to 2770 level in coming days. Mentha oil prices traded on weaker note due to surging selling pressure supported by abundant stocks at major trading. Supply is likely to remain sufficient in coming days wherein demand is stable at prevailing level. Subdued demand prospects will keep prices under pressure. However, prices may find support near 930-950 due to lower production estimates for year 2022. NCDEX Guar seed futures for Sep remained under pressure due to reports of increased acreages. Guar seed area in Rajasthan was reported at 29.7 lakh Ha as on 4th Aug’22 compared to 16.99 lakh Ha of previous year, higher by 75% Y-o-Y. Guar seed prices has breached the 5000 level and may find support near 4750 level wherein Guar gum futures will be supported at 8200 level. Castor seed futures traded down on sluggish demand. Prices will face strong resistance near 7500-7550 and fall downside on due to sluggish export demand of oil. Exports of castor oil have decreased by almost 10 percent during the first five months of 2022 as compared to previous year.
CRUDE OIL MCX (AUG)contract closed at Rs. 7034.00 on 04th Aug 2022. The contract made its high of Rs. 9227.00 on 14th Jun’2022 and a low of Rs. 6971.00 on 04th Aug’2022. The 18-day Exponential Moving Average of the commodity is currently at Rs 7584.73. On the daily chart, the commodity has Relative Strength Index (14-day) value of 35.079.
One can buy near Rs. 6950 for a target of Rs. 7450 with the stop loss of 6700.
ALUMINIUM MCX (AUG)contract was closed at Rs. 209.45 on 04th Aug’2022. The contract made its high of Rs. 215.80 on 28th Jul’2022 and a low of Rs. 203.10 on 15th Jul’2022. The 18-day Exponential Moving Average of the commodity is currently at Rs. 210.92. On the daily chart, the commodity has Relative Strength Index (14-day) value of 48.973.
One can buy near Rs. 210 for a target of Rs. 220 with the stop loss of Rs 205.
JEERA NCDEX (SEP)contract closed at Rs. 24515.00 on 04th Aug’2022. The contract made its high of Rs. 25015.00 on 27th Jul’2022 and a low of Rs. 22100.00 on 08th Jul’2022. The 18-day Exponential Moving Average of the commodity is currently at Rs. 23934.86. On the daily chart, the commodity has Relative Strength Index (14-day) value of 66.011.
One can sell near Rs. 24500 for a target of Rs. 23900 with the stop loss of Rs. 24800.
Some weak data along with marginal buying in dollar index exerted pressure in commodities and CRB closed weak. Both benchmarks of crude oil fell to its weakest levels since February in the last week after U.S. data showed crude and gasoline stockpiles unexpectedly surged last week and as OPEC+ agreed to raise its oil output target by 100,000 barrels per day (bpd), equal to about 0.1% of global oil demand. OPEC+ agreed to increase production by 100,000 barrels per day in September, far lower than previous months' production. The global energy market still faces supply shortages. Natural gas prices zoomed up again on supply issues. Gold prices edged higher, with most other precious metals marking small gains after a rally in the U.S. dollar appeared to have paused amid safe haven buying. Silver on MCX saw marginal gain. Copper and aluminum prices dropped last week following a track of weak manufacturing PMIs from across the globe. This trend of weakening factory data is expected to weigh on industrial metals in the coming months. Metals saw correction after two week of recovery as traders and investors sold risky assets amid escalating China-US tensions. Metals prices have also been weighed down by weak consumption from China, and surveys showed weak factory activity across the United States, Europe, and Asia in July, adding to fears of a recession and gloomy demand outlook. Zinc prices rose, and the premiums remained largely stable.
Cotton futures (Aug) continued to trade higher on reports of some demand from the textile industries following reports of damage to the standing crop due to excessive rains in the country and uptrend in ICE cotton. The balance stock of cotton with the mills of the state is less, while the arrival of the new crop in the mandis will start in the state only in September-October. Spices turned weak despite monsoon and festive season. Sufficient stocks and good sowing reports kept turmeric prices under pressure. Coriander prices dropped sharply in the spot market and futures as well due to subdued demand. The buyers from south India as well as the local processors have reduced their buying currently, that’s why coriander prices are steady. Guar counter continued to trade weak for second week. Guar seed and gum prices dropped sharply in the physical markets amid speculations of higher production of guar seed after timely rains occurred in the Rajasthan and other major guar producing states. As on 01st August, Guar area in Rajasthan is higher by 117% at 29.39 Lakh hectares as compared to 15.18 Lakh hectares last year. Castor saw fall on higher acreage while the fall was limited due to lesser carry forward stock and overall demands.
Higher crude prices have become concern for the entire world; responsible for fat inflation numbers. After Russia and Ukraine war saga, the US and Western sanctions on Russia have caused prices of all types of energy to soar, resulting in inflation at multi-decade highs and central bank interest rate hikes. This is leading the world into recession. To rein in prices of energy as well as inflation the world is looking to towards OPEC group to pump more oil to help rein in prices. But Organization of the Petroleum Exporting Countries and its allies, known as OPEC+, has not agreed to boost greater oil production. The OPEC+ has agreed to only 100,000 barrels per day oil production hike from September as it warned of a lack of spare capacity for any greater increases. Crude has consistently traded at more than $100 a barrel since February, driving up the cost of living in many countries.
In April 2020, OPEC+ introduced a series of cuts that continued throughout the coronavirus pandemic as demand dropped. OPEC+ began to add around 400,000 barrels per day to the market last year, renewing the policy every month until June. It upped production by almost 650,000 bpd in July and August.
The US has put OPEC leaders Saudi Arabia and the UAE under pressure to pump more oil to help rein in prices boosted by rebounding demand and Moscow’s invasion of Ukraine. But in a statement after the meeting, OPEC+ warned that a lack of investment into the upstream sector will impact the availability of adequate supply “to meet growing demand beyond 2023 from non-participating non-OPEC oil-producing countries, some OPEC Member Countries and participating non-OPEC oil-producing countries.”
In June, OPEC+ produced almost 3 million barrels per day less crude than foreseen by its quotas as sanctions on some members and low investment by some others crippled its ability to assuage the world’s energy crisis Saudi Arabia and the UAE are believed to be the only two producers in OPEC+ and in the world currently holding enough spare capacity to raise their oil production. A 100,000 bpd increase for the entire group will likely mean less than a 30,000 bpd increase for Saudi Arabia, and a less than 10,000 bpd increase for the UAE. Saudi's production target for August, however, is 11 million barrels of oil per day, which energy experts suggest is already at a very high level, leaving little wiggle room for more increases.
Uncertainty still remains about Oil market
The question still remains how much more crude oil OPEC can produce on a daily basis has clear and far-reaching implications for the health and stability of the global economy. Rising interest rates, the war in Ukraine and looming recession in many western countries, could all seriously dent demand. These factors are making the group cautious and unwilling to increase their output dramatically. Estimates from the International Energy Agency and the US Energy Information Administration meanwhile suggest oil demand will continue rising strongly, despite growing fears over inflation in multiple countries and weakening economic growth. However uncertainty continues as no one knows where the oil markets will be in next six months from now, or next year.
Weekly volatility in Indian Rupee jumped to the highest level in last five months as markets remained pretty divided before RBI policy over quantum of rate hike in August meeting. Accordingly RBI raised repo rate for the third time by 50 bps with stance remains unchanged for withdrawal of accommodation which eventually considered being hawkish. RBI reiterated to bring down inflation to 4.00% in coming fiscal years while set the projection for CPI in FY23 at 6.7%, which is unchanged from the previous forecast. Going forward, if global headwinds turmoil notably from geo-political issues from US-CHINA-TAIWAN or Fed’s risk increases in Jackson Hole meeting late in August, we may see rupee back in depreciation mode below 80 vs dollar. Inevitably the underlying risk for rupee is not yet diminished from widening trade deficit concerns but on a quick frame picture, RBI tried to defend the rupee by sounding hawkish than market expectations. Next week US CPI data will be crucial for dollar index move as well as in rupee. Apparently the bias for a stronger dollar remains high.
USD/INR (AUG)contract closed at 79.5350 on 04-AUG-22. The contract made its high of 79.9825 on 04-AUG-22 and a low of 78.6875 on 02-AUG-22 (Weekly Basis). The 21-day Exponential Moving Average of the USD/INR is currently at 79.4937.
On the daily chart, the USD/NR has Relative Strength Index (14-day) value of 52.54.One can buy at 78.90 for the target of 79.90 with the stop loss of 78.40.
GBP/INR (AUG)contract closed at 96.5650 on 04-AUG-22. The contract made its high of 97.3775 on 04-AUG-22 and a low of 96.0625 on 03-AUG-22 (Weekly Basis). The 21-day Exponential Moving Average of the GBP/INR is currently at 96.1900.
On the daily chart, GBP/INR has Relative Strength Index (14-day) value of 52.67. One can buy at 96.00 for a target of 97.00 with the stop loss of 95.50.
| 04th AUG | The Bank of England raised its main rate by 50 bps to 1.75% |
| 04th AUG | US jobless claims hit six-month high as labour demand cools |
| 03rd AUG | IMF urges Europe to pass on energy costs to consumers |
| 03rd AUG | US House Speaker Pelosi arrives at Taiwan's parliament. |
| 03rd AUG | China suspends 2,000 food products from Taiwan as Pelosi visits |
| 02nd AUG | Chinese fighter jets fly close to Taiwan ahead of Pelosi visit |
| 02nd AUG | JOLTs Job Openings For June 10.698M Vs 11.00M Expected. |
| 01st AUG | The unemployment rate in the Euro Area was unchanged at 6.6% for June. |
| 01st AUG | July U.S. Manufacturing PMI Registers 52.8%, down slightly from June. |
EUR/INR (AUG) contract closed at 81.1275 on 04-AUG-22. The contract made its high of 81.6000 on 04-AUG-22 and a low of 80.4500 on 03-AUG-22 (Weekly Basis). The 21-day Exponential Moving Average of the EUR/INR is currently at 81.3598.
On the daily chart, EUR/INR has Relative Strength Index (14-day) value of 46.60. One can sell at 81.50 for a target of 80.50 with the stop loss of 82.00.
JPY/INR (JUL) contract closed at 59.3675 on 04-AUG-22. The contract made its high of 60.6225 on 02- AUG-22 and a low of 59.0000 on 03-AUG-22 (Weekly Basis). The 21-day Exponential Moving Average of the JPY/INR is currently at 58.5200.
On the daily chart, JPY/INR has Relative Strength Index (14-day) value of 56.06. One can sell at 59.80 for a target of 58.80 with the stop loss of 60.30.
SSBA Innovations, which runs tax portal TaxBuddy, has filed preliminary papers with capital markets regulator SEBI to raise Rs 105 crore through an Initial Public Offering (IPO). The IPO is entirely a fresh issue of equity shares aggregating up to Rs 105 crore, according to the Draft Red Herring Prospectus (DRHP). Proceeds of the issue to the tune of Rs 65.45 crore will be used for funding user acquisition and business development, Rs 15.22 crore for technological development and balance amount towards general corporate purpose. The company is a technology-driven financial solutions and services platform focused on providing financial solutions in the area of tax planning and filing, personal investment advisory and wealth building to individuals, HUF, professionals, firms, and companies registered on its platforms. Incorporated in 2017, SSBA Innovations owns two platforms — TaxBuddy and Finbingo. TaxBuddy was launched in October, 2019, that offers assisted tax (ITR and GST) planning and filing, advisory and IT notice management and Finbingo was launched in May 2022 that offers financial solutions, including planning, advisory and wealth management. Systematix Corporate Services has been appointed to manage the company’s IPO. The equity shares of the company will be listed on the BSE and NSE.
Utkarsh Small Finance Bank Ltd has filed a revised draft papers with Securities Exchange Board of India with cutting its issue size by 63% to raise Rs 500 crore via initial public offering (IPO). The IPO consists of only fresh issue of shares. Earlier the lender had filed DRHP in Jul 2021 to raise Rs 1350 crore comprising a new issue worth Rs 750 crore and an OFS to the tune of Rs 600 crore by its promoter Utkarsh Coreinvest. The lender did not mention reasons behind cutting the IPO size. The proceeds from the issue will be used for augmentation of Tier-I capital base to meet its future capital requirements. As of 31 Mar 2022, it’s Tier-1 capital base stood at Rs 1420.76 crore which is equivalent to 18.08 percent of the risk weighted assets as against minimum requirement of 7.5 percent. The lender, which came into the operation in 2010, is primarily focused on providing microfinance to unserved and underserved segments and in particular in the states of Uttar Pradesh and Bihar. For fiscal year 2022, its total deposits stood at Rs 100.75 billion as against Rs 75.08 billion a year ago. Gross loan portfolio increased to Rs 106.31 billion from Rs 84.16 billion year-on-year. Loan disbursement rose to Rs 90 billion from Rs 59 billion. The lender's gross non-performing assets for the period increased 6.1% from 3.75% last year. Net NPA rose 2.31% versus 1.33%. It reported a 45% deadline in profit from a year ago to Rs 61.46 crore. ICICI Securities, Kotak Mahindra Capital are the lead managers to the issue. As of 31 Mar 2022, the lender had 686 Banking Outlets and 12,617 employees across 22 states and Union Territories. Currently 27.70 percent of its Banking Outlets are located in Unbanked Rural Centres (URCs) as against the regulatory requirement of 25%. The lender had 3.14 million customers (both deposit and credit) majorly located in rural and semi-urban areas primarily in Bihar, Uttar Pradesh and Jharkhand.
Cloud-based architectural design software startup Infurnia Holdings has filed its draft red herring prospectus (DRHP) with the Securities and Exchanges Board of India (SEBI) for raising INR 38.2 Cr via its initial public offering (IPO). The IPO will entirely comprise a fresh issue of shares and will not have any offer for sale (OFS) component. The startup’s shares will be listed on the BSE Startups platform. Infurnia’s founders – Nikhil Kumar and Lovepreet Mann – hold the largest share in the startup. While Kumar holds 30.63% stake in Infurnia, Mann has 20% stake. Together, the promoter shareholding in the startup stands at 50.64%. In January this year, Infurnia had said that it was planning for an IPO to list on the BSE Startups platform. The startup will use the funds raised through the IPO to expand the business of its wholly owned subsidiary company; towards the development, upgradation and maintenance of its cloud-based software; and for other general corporate purposes. Infurnia would invest INR 29.02 Cr in its wholly owned subsidiary, while INR 8.68 Cr would be used for general corporate purposes. “Our company believes that listing will give more visibility and enhance our company’s corporate image, brand name and create a public market for its equity shares in India. It will also make future financing easier and affordable in case of expansion or diversification of the business,” Infurnia said in its DRHP. Set up in 2014 by Kumar and Mann, Infurnia owns, develops and operates a cloud-based platform that allows professionals to design buildings, interiors, and modular kitchens. The startup has so far raised over INR 10 Cr in multiple equity funding rounds from various investors and corporate bodies.
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DSP Investment Managers have launched DSP Silver ETF which will invest in physical silver and silver-related instruments. The new ETF offers investors an easier way to buy or sell silver compared to the physical version with the freedom to trade easily. The New Fund Offer for the Silver ETF opens for subscription on August 1and closes on August 12. “Investing in silver via an ETF is a modern and smart way for investors to gain exposure to this precious metal in an easy, digital form. Increasing demand for silver in industries, newer technologies and a shift to renewable sources of energy and the safe-haven demand can also act as favourable tailwinds for the metal. However, investors should expect fluctuations in short-term returns, especially during times of market volatility. An investment in DSP Silver ETF is suitable for investors looking to diversify, or for experienced investors or those with access to expert financial advice,” says Anil Ghelani, CFA, Head – Passive Investments & Products, DSP Investment Managers. A press release from the fund house said that silver offers advantages to investors like hedging against a standard ‘equity-debt portfolio’ due to its low correlation with equity and negative correlation with debt. This may make it a favourable diversifier, especially in troubled times. Silver can also potentially act as leverage against the depreciating rupee. Silver in INR terms has outperformed Silver in USD due to currency depreciation.
IDFC Mutual Fund has launched IDFC Midcap Fund, an open-ended equity scheme investing predominantly in equities and equity-linked securities in the midcap segment. The New Fund Offer will open for subscription on July 28 and close on August 11. According to the press release, the key differentiator of IDFC Midcap Fund is that it will follow a 5 Filter Framework for the selection of stocks, helping build a high- quality, growthorientated portfolio. This investment framework selects companies based on five fundamental parameters including Governance/Sustainability, Capital Efficiency, Competitive Edge, Scalability, and Acceptable Risk/Reward.
Sebi has amended mutual fund rules to remove the applicability of the definition of "associate" to sponsors that invest in various companies on behalf of the beneficiaries of insurance policies. The new rules will become effective from September 3, the Securities and Exchange Board of India (Sebi) said in a notification. The regulator's board approved the proposal last month. "The definition of associate shall not be applicable to such sponsors, which invest in various companies on behalf of the beneficiaries of insurance policies or such other schemes," the regulator said. Under the rules, associate includes a person who directly or indirectly, by himself, or in combination with relatives, exercises control over the Asset Management Company (AMC) or the trustee, among others. At present, there are 43 mutual fund houses, which together manage assets worth nearly Rs 38 lakh crore.
NJ Asset Management has appointed Bijon Pani as Chief Investment Officer to spearhead the investments team. In his most recent work profile as a Portfolio Manager for an AI/ML quant fund he was instrumental in enhancing the existing quant model for better risk-adjusted return by modifying and incorporating new input factors based on extensive research. With over a decade of robust international and domestic experience in the financial and investments space, Bijon’s expertise lies in developing and leveraging factor-based models, quantitative research, and portfolio management, a press release said.
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