Markets

Nifty to tumble over 130 points on weak global cues

KS Badri Narayanan Chennai | Updated on April 30, 2021

Spotlight will be on quarterly results and progress of Covid-19 vaccination

Indian markets are expected to open slightly lower on Friday, amidst weak global cues emanated from Asian markets. The SGX Nifty, which currently rules at 14,770 at the Singapore Stock Exchange, indicates at least 130 points gap-down opening for Nifty futures, which on Friday closed at 14,901.

According to analysts, the focus will be on progress in Covid pandemic and corporate results.

Though the US market closed on strong note overnight, Asian markets from Japan, to Korea; and Australia to Taiwan are ruling weak in early trade on Friday, as China’s crackdown on technology firms affected the sentiment. The US market overnight ended firm due to strong GDP data.

“So far the positive global cues and strong quarterly earnings season has been supportive to the market. While the market undertone is positive, the extension of lockdowns and the continuous rise in cases could cap the upside. The progress on the vaccination front from next week as it gets opened for all will be eagerly tracked,” said Siddhartha Khemka, Head - Retail Research, Motilal Oswal Financial Services Ltd.

The roll-over of open positions to May contracts for Nifty futures stood at 60 per cent and for Bank Nifty futures 63 per cent, lower than the three-month average. This indicates that traders prefer to wait and watch.

Binod Modi, Head Strategy at Reliance Securities, said management commentaries of various companies have so far been encouraging despite seeing some initial disruption due to second wave of Covid-19. “Notwithstanding some adverse impact on economic activities for one or two months, a sharp pick-up in capital expenditures in current fiscal is still on the cards. Hence, earnings recovery in FY22E still remains promising. Therefore, any near-term possible correction in the market should be treated as opportunity of bargain trading. Investors must focus on quality stocks with robust earnings visibility and margins of safety,” he added.

Stocks to watch

Ujjivan Financial Services on Thursday informed the exchanges that minority shareholders have rejected a special resolution to appoint founder and chairman Samit Ghosh as Managing Director and Chief Executive Officer. Also, shareholders didn’t approve the special resolution to re-appoint Abhijit Sen as an independent director, according to results of the e-voting sent to stock exchanges.

Aarvee Denim: The company informed the exchanges that an accidental fire broke out at its Matoda Spinning unit situated at Sarkhej-Bavla Highway, Ahmedabad. The fire was brought under control and no one was injured, it said. Due to fire, a part of inventories, and some portions of plant & machineries and some buildings of the Matoda unit have been damaged. The company has lodged a preliminary claim with insurance company. The production of the Matoda spinning unit was stopped, however, the company has partially restarted the production of the said unit on Thursday. Production at the other two units — Narol unit and Vijay Farm unit is continued without any disruption, it further said.

Dr. Reddy's Laboratories Ltd along with its subsidiaries on Thursday announced the launch of Albendazole Tablets, USP, a therapeutic equivalent generic version of Albenza Tablets, 200 mg, approved by the US Food and Drug Administration (USFDA). The Albenza brand and generic had US sales of approximately $27 million MAT for the most recent twelve months ending in November 2020, according to IQVIA Health.

Puravankara: The Rating Committee of ICRA has maintained the previous rating and assigned a long-term rating of [ICRA] BBB+ and outlook has been improved to Positive from Stable and has maintained the previous short term rating of [ICRA] A2 for ₹3,000 crore bank facilities of Puravankara Limited.

Jay Bharat Maruti: The board of directors of Jay Bharat Maruti has recommended an issue of bonus shares in the proportion of 1:1. The board also approved a dividend of ₹1.25 a share (face value ₹5).

Sadbhav Infrastructure Project Limited: The board has approved, execution of Unit Purchase Agreement with CPP Investment Board Private Holdings towards sell and transfer the right, title ownership and interest in, free of all encumbrances, 434,28,782 units of Indinfravit Trust held by the company in dematerialised form upon the terms and conditions contained in a Unit Purchase Agreement. The consideration to be received from the above sale is ₹441 crore.

Result calendar

Accelya Solutions India, Ajanta Pharma, Alicon Castalloy, Astec Lifesciences, Atul, B2B Software Technologies, Betala Global Securities, Dugar Housing Developments, IndusInd Bahnk, Marico, Indian Hotels, Can Fin Homes, RPG Life Sciences, Indian Acrylics, Mahindra EPC Irrigation, Maral Overseas, Magellanic Cloud, MRC Exim, Progrex Ventures, Raghav Productivity Enhancers, Reliance Industries, Sacheta Metals, Shriram City Union Finance, SSPN Finance, Supreme Petrochem, Teesta Agro Industries, Trent and Walchand Peoplefirst will announce quarterly results.

IPO Corner

Maharatna company Power Grid Corporation’s InvIT offering opened for subscription on Thursday. The public issue of InvIT, first ever from a public sector company, has a price band of ₹99-100 per unit. On day 1, the issue has received bids for just 10 per cent. However, ahead of the issue, it got off to a strong start with the anchor book seeing mop up of ₹3,480 crore on Wednesday from as many as 47 institutional investors that included several international and leading domestic funds. The company plans to raise of ₹ 7,735 crore from the issue.

Published on April 30, 2021

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