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August 22, 2023

*India Daybook – Stocks in News* *Welspun Enterprises:* Company acquires remaining 50.10% stake in Michigan Engineers (Positive) *Union Bank:* Board approves raising up to ₹5,000 cr via Qualified Institutional Placement, floor price at ₹91.10/sh. (Positive) *Tata Power:* Renewable Energy signs PPA for 9 MWp on campus solar plant with Tata Motors Limited for Pantnagar plant in Uttarakhand (Positive) *Adani Ent:* Promoter has raised stake to 69.87% from 67.65%, acquired 2.22% from August 7-18 (Positive) *Sula Vineyards:* Company to concentrate on vineyards outside Bengaluru (Positive) *Lemon Tree:* Company has signed license agreements for two properties in Bhubaneswar and Kasauli (Positive) *Brigade:* Company has entered into a sale deed for acquiring 6.54 acres of land parcel in Chennai. (Positive) *RITES:* Company signed a MoU with NHPC Limited to collaborate on comprehensive Consultancy services for Rail Infrastructure facilities (Positive) *BHEL:* Company has received an order worth of Rs 4000 crore from Mahan Energen, a unit of Adani Power (Positive) *BLS International:* BLS International FZE is in process to subscribe 100% share capital of Saudi Arabia-based BLS International Travel & Tourism (Positive) *Glenmark:* USA reaches antitrust settlement with US Department of Justice, Antitrust Division (DOJ) (Neutral) *Adani Power:* Company targets 21,110 MW thermal capacity by fiscal 2029. (Neutral) *Adani Energy Solutions:* To meet investors on Aug 23, Aug 30: Agencies. (Neutral) *Shriram Properties:* Omega TC Sabre Holdings sold 18 lakh shares at Rs 75.43 apiece. (Neutral) *Sanghi Industries:* Ambuja Cements has made an open offer to acquire a 26% stake for Rs 767.16 crore. The offer opens on Sept. 29 and closes on Oct. 13. (Neutral)
*Stocks To Watch:*
*Adani Enterprises:* Founder firm Kempas Trade and Investment bought 2.53 crore shares (2.22%). The purchase was made from open market between Aug. 7 to Aug. 18. The company has also incorporated a wholly-owned subsidiary Sirius Digitech International to provide digital solutions and services.
*Adani Power:* The company has targeted a total capacity of 21,110 MW by FY29. This includes proposed inorganic capacity at 1,100 MW, brownfield capacity of 3,200 MW, core existing capacity of 15,210 MW and committed brownfield capacity of 1,600 MW. It sees the net senior debt at Rs 26,690 crore in FY24 vs Rs 24,350 crore in FY23.
*Union Bank of India:* The board approved to raise up to Rs 5,000 crore from Qualified Institutions Placement. It set the floor price at Rs 91.10 apiece for the issue opened on Aug. 21.
*Sanghi Industries:*
Ambuja Cements has made an open offer to acquire a 26% stake for Rs 767.16 crore. The offer opens on Sept. 29 and closes on Oct. 13.
*Tata Power:* The company's arm Tata Power Renewable Energy signed a power purchase pact with Tata Motors for 9 MWp on campus solar plant at Pantnagar in Uttarakhand. The project will be commissioned within six months.
*Welspun Enterprises:* The
company acquired 50.10% stake in Michigan Engineers from Authum Investment & Infrastructure and Sansaar Housing Finance for Rs 137.07 crore. Post acquisition, Michigan becomes a subsidiary.
*Lemon Tree Hotels:* The hotel chain has signed license agreements for two properties in Bhubaneswar and Kasauli under the brand Lemon Tree Hotel and Lemon Tree Mountain Resort, respectively. The hotel in Bhubaneswar is expected to be operational by Q4FY25, and the hotel in Kasauli is expected to be operational by Q3FY26.
*Brigade Enterprises:* The south-based real estate developer has entered into a sale deed for acquiring 6.54 acres of land parcel in Chennai in which a residential project will be developed.
*BLS International:* The company's subsidiary BLS International FZE is in process to subscribe 100% share capital of Saudi Arabia-based BLS International Travel & Tourism.
*RITES:* The company signed an MoU with NHPC to collaborate on comprehensive consultancy services for rail infrastructure facilities for NHPC’s hydropower projects in Arunachal Pradesh.
*Rail Vikas Nigam:* The company incorporated a wholly-owned subsidiary Masakani Paradeep Road Vikas.
*IPO Offerings*
*Aeroflex Industries:* The initial public offering will be open between Aug. 22 and 24. The manufacturer of stainless steel hoses will have an IPO issue size of Rs 351 crore. It consists of a fresh issue of Rs 162 crore and an offer for sale of Rs 189 crore by the promoter group, at a price band of Rs 102–108 apiece.
*Bulk Deals*
*Shriram Properties:* Omega TC Sabre Holdings sold 18 lakh shares (1.1%) at Rs 75.43 apiece.
*Insider Trades*
*Vimta Labs:* Promoter Sujani Vasireddi sold 18,234 shares on Aug. 17.
*Trading Tweaks*
*Price Band Revised From 20% To 10%:* BF Utilities.
*Ex-date Dividend:* Karnataka Bank, Subro, Panama Petrochem, NHPC, ICICI Securities.
*Ex-date Interim Dividend:* Sun TV Network, Natco Pharma, KPI Green Energy, Dreamfolks Services.
*Ex-date AGM:* Subro, Panama Petrochem, Aurobindo Pharma, NHPC.
*Record-date Dividend:* Karnataka Bank, NHPC.
*Record-date Interim Dividend:* Sun TV Network, Natco Pharma, KPI Green Energy, Dreamfolks Services.
*Move Into Short-Term ASM Framework:* Technocraft Industries (India), Hindustan Oil Exploration.
*Move Out Of Short-Term ASM Framework:* Gland Pharma, Orient Cement, RattanIndia Enterprises, SEPC.
*F&O BAN*
CHAMBLFERT
DELTACORP
GNFC
HINDCOPPER
IBULHSGFIN
India Cem
MANAPPURAM
METROPOLIS
PNB
SAIL
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News & Impact
· Smart recovery in US market from the intra-day low and rally in the Asian markets, may open domestic bourses on a positive note. Overnight, Nasdaq 100 Index rose about 1.7%, with Tesla Inc. up the most since March by 7% and semiconductor major Nvidia Corp. jumped over 8% ahead of the chipmaker’s results due on Wednesday, which is expected to show a 65% rise revenue growth compiled by Bloomberg. However, Dow Jones ended marginally lower due to fall in US financial stocks after the rating agency S&P Global Ratings downgraded the ratings by one notch of five US lenders on “tough” environment amid higher interest rates. US 10-Year Yield spiked to 16-year high at 4.35% on ahead of key speech later in the week by the Federal Reserve Chair Jerome Powell. Gift Nifty is flat to negative while US Future is trading flat. Expects rangebound market today but stock specific action may continue. Technically, Nifty holding well above its 50 DEMA and formed a bullish candle after gained nearly 0.5% previous day. Impressive quarter results, hope of good monsoon and favorable government policy will support domestic market. Expects positive for IT stocks after global IT major Index Nasdaq Composite soared over 1.5%. Financial, hotel and mid & small cap stocks rally may continue in the market.
· Global Market summary – Rating agency S&P lowered grades one notch for KeyCorp, Comerica Inc., Valley National Bancorp, UMB Financial Corp. and Associated Banc-Corp, it said Monday in a statement, noting the impact of higher interest rates and deposit moves across the industry. European markets ended nearly 6-week low. Gold price fell to 5-month low. US 10-Year bond yields climbing to their highest since 2007.
· US Market –US stocks ended on a mixed bag but recouping some losses from a three-week decline, as investors shift the focus toward Jackson Hole later this week as earnings season draws to a close. Nasdaq Composite climbed up by 1.50%
· Asian Market – Asian equities opened higher Tuesday following a rally in big tech that spurred a rebound on Wall Street, though elevated Treasury yields kept risk sentiment in check. Stocks rose between 0.5% to 1% in Japan, Taiwan and South Korea, but edged lower in Australia.
· European Market – European stocks closed near a six-week low on Monday as worries about higher-for-longer interest rates snuffed out earlier gains with US bond yields climbing to their highest since 2007. Investors await comments from key central bankers at Jackson Hole later this week. UK Index declined 0.5% while Germany and France Index gained 0.2% and 0.5% respectively.
· Oil –Oil held a decline on signs that supply is rebounding while concerns linger about demand in China, the biggest importer. Brent Crude is hovering at $85/bbl
· Gold – Gold was steady near a five-month low at $1995/ounce on increasing signs that US interest rates will need to stay higher for longer. The 10-year Treasury yield kept rising
· reaching a 16-year high in the previous session, signaling bondholders are bracing for the risk that monetary policy will remain tight. Higher rates are typically negative for bullion, which doesn’t offer interest.
· Previous Day market Update – Nifty climbed up nearly 100 points on renewed buying interest as heavyweight ITC, L&T, Bajaj Finance, Infosys TCS and Indusind Bank boosted sentiment after strong opening in the European markets along with surge in US Future. Banking, financial, capital goods, select metal and IT stocks witnessed fresh buying. Nifty surged 83 points or 0.4% to close at 19393 while Sensex advance 267 points or 0.4% to close 65216 against the previous days close. Global rating agency Moody's affirmed India's sovereign rating at 'Baa3' with a stable outlook and few days before rating agency Fitch says Indian Banks on a strong growth trajectory boosted the market sentiment. FIIs were net sellers were Rs1901cr while and DIIs were net buyers Rs626cr respectively.
· Nifty Technical Levels – Nifty has been showing signs of recovery and holding well above its 50 DEMA. It formed a Bullish candle on daily frame and closed with gains of around 80 points near 19400 zones. Now it has to hold above 19350 zones, for an up move towards 19480 and 19560 zones whereas supports are placed at 19300 then 19250 zones.
· Bank Nifty Technical Levels – Bank Nifty took support near 43850 zones and gradually moved higher towards 44100 zones in the latter part of the day. It formed a small bodied bullish candle on daily scale and closed with gains of 150 points near 44000 zones. Index has got stuck in between 43600 and 44100 zones from the past few sessions. Now it has to hold above 44000 zones for a bounce towards 44250 then 44444 marks while on the downside support exists at 43800 then 43600 levels.
· Actionable BUY – GMR Infra, BSE, BHEL, GRSE
· Brokers Radar – Aurobindo Pharma TGT by Citi at 750, Citi TGT on Sun Pharma at 1275. Tata Consumer TGT by Nomura at 872,
· Events – Aeroflex IPO open today with price band between Rs102-108, IPO close on 24th August. Piramid Technoplus IPO subscribed nearly 6 times and today final day
· Corporate Action - Ex-dividend - Sun TV Rs6.25, Karnataka Bank Rs5.00, Natco Pharma Rs7, ICICI Securities Rs9.25.
· Global Data – Existing Home Sales, US Fed Business conditions (US).
· Market Summery - Power demand hits in record high in August, Ujjivan Small Finance Bank to move RBI for universal bank status, Tata Seeks Partnerships for UK Battery Plant to Supply Jaguar Land Rover EVs, Canara Bank launches UPI Interoperable Digital Rupee mobile application. Tata Power Renewable Energy to set up solar facility for Tata Motors. Telecom sector AGR up 2.53% on-qtr in Q4FY23
· Vedanta – Court hearing on Vedanta copper smelter reopening
· Power stocks in focus as peak power demand hits record high. Peak power demand breached all previous records on August 17 as the country clocked a demand of 234,058 megawatt (MW) or 234 gigawatt (GW) owing to rising temperatures and humidity. – Positive for IEX, Tata Power, JSW Energy.
· Ujjivan Small Finance Bank – Company is gearing up to take the next step towards becoming a universal bank. The bank has laid out a plan to expand the share of secured lending. As of June 2023, 27 per cent of the gross loan book of the bank was secured and the remaining 73 per cent is through unsecured lending in microfinance. The bank may also explore inorganic options should the need arise to scale up the secured books faster. – Positive
· Tata Power – Company signed a Power Purchase Agreement (PPA) for 9MWp on campus solar plant in Uttarakhand. This solar plant will be the largest on campus solar facility in the State – positive.
· Adani Enterprises - The promoter group increased stake in Adani Enterprises in August, buying 2.2% during the month.
· Welspun Enterprises - Welspun Enterprises has announced the successful acquisition of a 50.10% stake in Michigan Engineers.- positive
· Union Bank - The Board approved raising of funds up to Rs 5000 crore through issue of equity shares via qualified institutions placement. – Positive
· Lemon Tree Hotels – company has signed license agreements for two properties in India – Positive
· Adani Power - Adani Power targets 21,110 MW thermal capacity by fiscal 2029. Net senior debt is seen at Rs 26,690 crore in FY24.
· Focus on Telecom stocks - Telecom industry recorded a 2.53% sequential growth in adjusted gross revenue (AGR) in the January-March quarter of the financial year 2022-23, while the year-on-year growth in AGR was recorded at 11.12%, the Telecom Regulatory Authority of India (TRAI) report. Reliance Jio notched up the highest sequential AGR gain in the March quarter, FY 23, ahead of Bharti Airtel, while loss-making Vodafone Idea(Vi) reported a fall. – expects positive for Reliance, Bharati Airtel.
· Monsoon Update - Cumulative Monsoon Rainfall 7% below normal as of Aug. 21 – it has recovered partially from the recent low after improved rainfall in the major part of India – expects positive for the market.
· Canara Bank launched UPI Interoperable Digital Rupee mobile application as a part of the Reserve Bank of India's Central Bank Digital Currency (CBDC) pilot project. Canara Bank is the first Bank among public and private sector banks to introduce this feature in Bank’s CBDC mobile app called 'Canara Digital Rupee app'. – Positive
· Real Estate stocks focus - The Mumbai Metropolitan Region topped with 17 land deals, followed by 13 in the National Capital Region so far this year. At least 59 land deals have been struck involving 2,018 acres so far this year across the country for the development of real estate projects and industrial purposes, according to Anarock. Real estate consultant Anarock noted that the number of land deals has gone up post Covid pandemic as real estate developers look to expand their business to tap a rise in demand for residential and commercial properties – Expects positive for Lodha, Godrej Properties, DLF.
· NIIT Ltd – Company launches learning platform for real estate brokerage – positive
· JSW Steel – Company to increase cement capacity from from 18.6mn tons to 50mn tons by FY30.
· ABB India – Company secured a major automation contract from Reliance Life Sciences (RLS) to automate its new manufacturing plants in Nashik. RLS' 160-acre facility at Nashik will house manufacturing
· plants for plasma proteins, biopharmaceuticals, oncology pharmaceuticals and vaccines.- positive
· L&T – Company gets orders worth Rs1000cr – Rs2500cr for urea plant in Australia – Positive
· Bharat Forge – Company received two export orders worth Rs850cr from friendly countries for the supply of components and armored vehicle chassis, to be executed over a 18-month-long timeframe – positive
· BHEL – Company gets an order worth Rs 4,000 cr from Mahan Energen. Order for equipment supply and supervision of erection & commissioning for 2x800 MW power project. Mahan Energen is a wholly owned subsidiary of Adani Power.- positive
· Inox Green Energy - Company gets LoA from NLC India with an estimated value of Rs 40 crore. Company to operate and maintain NLC's 51 MW wind turbine generator in Tamil Nadu for five years.- positive
· Ashok Leyland: The company would be issuing a corporate guarantee of GBP 82.10 million or Rs 870 crore to cover the lender facilities of U.K. two subsidiaries— Optare and Switch Mobility - We are long term positive on the stock
· United Spirits: The company signed an extra-neutral alcohol manufacturing contract with Capovitez for a tenure of three years. It covers provisions such as purchase of grain and sale of ENA, delivery, storage, quality in service, material’s price and payment, confidentiality, etc. – positive
· Spandana Sphoorty Financial: Rating agency ICRA has upgraded the ratings and revised the outlook for various instruments. Long-term fund based for Rs 2,105 crore has been upgraded to [ICRA] A from [ICRA]A-, outlook to stable from positive. – positive
· Tata Seeks Partnerships for UK Battery Plant to Supply Jaguar Land Rover EVs - Tata Sons is in discussions with multiple startups as the conglomerate seeks technical know-how for its £4 billion ($5.1 billion) UK battery plant, where it aims to start mass production in 2026. The collaborations for the battery plant, capable of supplying cells for at least 500,000 vehicles a year- Media Report
· Jio Financial Services Unit Has Tepid Start in Mumbai Debut - Shares of Jio Financial Services, a recently spun off unit of Reliance Industries, made a weak start in a widely watched trading debut on Monday. Jio Financial’s stock dropped to as low as Rs248.90 after opening at Rs265 a share
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