Shavasana — the sleeping pose. That was the mood of the market last week, with the Russia-Ukraine conflict creating uncertainty around valuations. What with Putin getting aggressive and Volodymyr Zelensky holding on bravely in Virabhadrasana, the warrior pose, the Sensex was shedding points madly every day. It is interesting that it took a ‘soya’ to awaken the ‘soya hua’ market and create some ‘ruchi’ in the valuations.

The Ruchi Soya follow-on public offer (FPO) opened on March 24 and the markets heaved a collective sigh of Pranayama. The company was looking to raise ₹4,300 crore through the FPO and was subscribed 3.6 times by the time the issue closed on March 28.

In December 2017, the National Company Law Tribunal (NCLT) had started the insolvency proceedings against Ruchi Soya. Patanjali acquired Ruchi Soya for ₹4,350 crore under the Insolvency and Bankruptcy Code in 2019. For brand Patanjali, which was already well-engaged with the health segment, the acquisition seemed perfect and would give them the exact protein needed for growth.

Going ahead, whilst Patanjali will operate in the non-food medicine and wellness segments, the food businesses would be transferred to Ruchi. Ruchi Soya will work under four major verticals, namely edible oil, food and FMCG, nutraceuticals and oil palm plantations. Even as the product line consolidation happens, the company also has to comply with SEBI guidelines for acquisitions.

Under these regulations, Patanjali has to reduce its stake in the acquired company below 90 per cent within 18 months of acquisition and below 75 per cent within three years of acquisition. Baba Ramdev seems to be busy, balancing the product lines with the financials of the company together with the legalities of acquisitions. Quite the Trikona.

Babaji has taken to EBITDA and PAT like they were Anulom-Vilom. It is really interesting to hear the pro-fit Yogi talk of profits. It almost reminds one of Jackie Chan in the Karate Kid. ‘Kung Fu lives in everything we do, Xiao Dre. It lives in how we put on the jacket, how we take it off, how we treat other people. Everything is Kung Fu!’ You almost expect Babaji to tell you that everything is Yoga. Businesses certainly can be classified as yoga — is that why they are called Ud-Yoga?

Yogic markets

Whilst the world of yoga enters financial markets, the markets on their part have suddenly become yogic. The bulls were seen to be looking rather pale and confused by the development. ‘So far, all that the bull pose needed was a phone in one hand and frantic yelling into the mouthpiece followed by a wiggly jump when the markets went up. But now, we are expected to know the Vrishabhasana, the bull pose. This apparently makes the breathing regular, the body energetic and the mind peaceful. After all these years of keeping the mind energetic and the body peaceful, we aren’t quite sure this will work for us!’ opined a rather doubtful-looking bull.

The bears are not exactly too thrilled either. They have been instructed by the SEBI to practice the Merudandasana, or the balanced bear pose. Given their high propensity to create a state of major imbalance within the markets, the balanced bear is more than what most can fathom.

Technical indicators and chart patterns are being given new yogic identities. Bollinger Bands and Fibonacci lines are being replaced by the Iyengar bands and straps. The Moving Average Convergence Divergence (MACD) line is one of the most popular technical indicators which indicates the momentum of stock. One compares the 12-day moving average of stock prices to the 26-day moving average. If the short-term line crosses the long-term line, it indicates the possibility of the stock trading higher in the near future. This is best captured in the Supta-Matsyendrasana.

The MACD will henceforth be referred to as the SuptaMatsya (SUMA) indicator. The head-and-shoulders chart pattern, captured through the regular Vajrasana position, indicates a danger of a selling episode on your stock in the near future. Technical analysts are suddenly talking of the Vajra effect on Indian bourses. A rounding top pattern is an oft-used indicator in tech analysis and is akin to an inverted U-shaped curve. It indicates a potential downturn in stock prices. ‘But that is a simple Chakrasana!’ said the Yoga instructors in delight, when shown the pattern on Indian stocks. ‘How apt,’ muttered the technical analyst darkly, ‘to call it Chakrasana when all it induces is a Chakkar in the mind of the investor’.

The anti-SUMA and Vajra patterns in Indian stocks are turning exchange rate calculations of the RBI topsy-turvy. When all calculations are in Shirshasana, how to maintain Kapotasana, the dove position, is the essential question.

The writer is a brave economist trying to laugh against the odds

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