Bounceback seen for benchmark indices

KS Badri Narayanan Chennai | Updated on March 26, 2021

Somany Home Innovation, Lupin, Sun Pharmaceuticals, Cadila Helathcare and Torrent Pharmaceuticals likely to see action today

The Indian stock markets are likely to open on a strong note signals from global markets indicate. SGX Nifty is currently ruling at 14,500 (7 am), which is a gain of 65 points against the Nifty April futures close of 14,435, and over 200 points above the Nifty spot close of 14,435.

Overnight, the Dow Jones and S&P 500 closed 0.62 per cent higher, while the Nasdaq jumped 0.12 per cent. The Asia-Pacific markets such as Japan, Korea and Australia, too, are trading in the green.

As the market has witnessed heavy selling in the last few days, marketmen expect a pull-back in the Indian markets, too. However, the market may remain in a range ahead of a holiday for Holi on Monday.

"The market may remain under pressure in the near term amidst weak global cues, and a fast spreading second wave of Covid in India, which could impact the pace of economic recovery. High commodity prices, too, are a concern and till that cools off substantially, the fear of inflation would continue to loom. Given the likelihood of high volatility continuing in the market for some time, investors would do well to stay calm and gradually accumulate good quality companies on declines in the market.," said Siddhartha Khemka, Head - Retail Research, Motilal Oswal Financial Services Ltd.

According to Nagaraj Shetti, Technical Research Analyst, HDFC Securities, the short-term trend for Nifty continues to be weak and a decisive move below 14,300 levels could drag the index to the next lows of 14,000 in the near term. "This support is the mid part of a long bull candle of February 1 (Budget day move) and also a 20 period weekly EMA. Any upside bounce from here is expected to find resistance at 14,500 levels," he added.

Stocks to watch

Somany Home Innovation: Group Atlantic, France, a 2.2-billion Euro company with a dominant presence in manufacturing, developing, and distributing eco-friendly heating products and hot water solutions, will invest Rs. 68.3 crore for a 50 per cent stake in the water heater business subsidiary of Somany Home Innovation Ltd.

Lupin, Sun Pharmaceuticals, Cadila Helathcare and Torrent Pharmaceuticals have agreed in principle to subscribe to a partnership interest in ABCD Technologies LLP (to be renamed as Indo Health Services LLP) for a consideration of Rs 40 crore each, through cash infusion as capital contribution The entity, a recently incorporated limited liability partnership ('LLP'), has not commenced business activity. The objective is to facilitate, enable and promote efficiency and good distribution practices, including digitising healthcare infrastructure in India, in support of the Centre’s National Digital Health Mission. The proposed LLP structure would ensure transparent and effective competition for the benefit of patients in India. .

Power Grid Corporation of India Ltd, (Powergrid) pursuant to its selection as the successful bidder under the tariff-based competitive bidding, has acquired Bikaner-II Bhiwadi Transco Ltd (BBTL), the Project SPV to establish Transmission System Strengthening Scheme for Evacuation of Power from Solar Energy Zones in Rajasthan (8.1 GW) under Phase-II Part-F, on build, own, operate and maintain (BOOM) basis from the Bid Process Coordinator - PFC Consulting Limited

Den Networks: Jio Futuristic Digital Holdings, Jio Digital Distribution Holdings and Jio Television Distribution Holdings will sell 5.55 crore shares or 11.63 per cent stake in the company through offer-for sale on March 26 (for institutional investors) and March 30 (for retail investors). The floor price for the sale has been fixed at Rs 48.50 per share. The news came in after market hours on March 25.

Hathway Cable & Datacom: Jio Content Distribution Holdings, Jio Internet Distribution Holdings, and Jio Cable and Broadband Holdings will sell 33.80 crore shares or 19.09 per cent stake in Hathway Cable through offer for sale on March 26 (for institutional investors) and March 30 (retail investors). The floor price has been fixed at Rs 25.25 per share.

Mahindra Lifespace Developers Ltd has announced the addition of a new residential project in Kalyan. The company has entered into an agreement for sale for 10.3 acres. This new project will offer approximately 7 lakh sq. ft. of carpet area and is expected to be launched in FY 2022.

Lux Industries: The board of company has approved a greenfield expansion plan of Rs 110 crore. The company has already identified a land parcel with a construction area of around 4,60,000 Sq.ft, of which 20-30 per cent will be used for a manufacturing unit and the balance for warehousing, storage and finishing facilities. The capex will be completed over next 12-18 months. Lux Industries has three major facilities in Kolkata, Tirupur and Ludhiana, which are capable of producing more garments than the installed capacity due to the improved efficiency and flexible manufacturing capabilities. It is also working towards more flexibility in terms of capacity, with enhanced mechanical tools and scientific way of working according to the market demand.

IPO Corner

Barbeque-Nation Hospitality Limited has been subscribed 1.98 times on Day 2 of the issue. The issue will close today for subscription. The portion reserved for retail investors was subscribed 9.66 times. While the Qualified Institutional Buyer category was subscribed 0.37, the Non-Institutional Investor category was subscribed 0.10 times. The employee category was subscribed 0.70 times.

The offer consists of a fresh issuance of equity shares aggregating up to Rs 180 crore and an Offer for sale of up to 54,57,470 equity shares of face value of Rs 5 each by the selling shareholders. The minimum bid lot is of 30 equity shares. The price band has been fixed at Rs. 498 – Rs. 500

Published on March 26, 2021

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