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Benchmark equity indices closed at record highs, driven by strong buying by foreign institutional investors and positive global sentiments. For the week, the Sensex surged 2.76% to 64,718.56 and the Nifty 50 index soared 2.8% to 19,189.05. For the month, the Nifty 50 rose 3.53% and the Sensex gained 3.35%.
In broader markets, the Nifty Midcap 100 index rose 2.74% to 35,754.35 and the BSE Smallcap index advanced 1.91% to 32,602.14 during the week.
In cash segment, FIIs were net buyers for Rs 20,361.7 crore and DIIs were net sellers for Rs 1,564.7 crore during the week. In the month of June 2023, FIIs were net buyers Rs 27,250 crore and DIIs bought for Rs 4,458.2 crore.
Top gainers among Nifty sectoral indices were Pharma [4.41%], Auto [4.11%], IT [3.53%], PSU Bank [2.95%], and Metal [2.85%]. For the week, all indices ended positively.
Indian rupee gained 3 paise to close at 82.03 against the US dollar on Friday.
Company News
HDFC Bank, HDFC: The boards of mortgage lender HDFC and private lender HDFC Bank have approved July 1 as the effective date of merger, and July 13 as the record date. The lender is likely to replace HDFC in the FTSE Global Equity indices but the eligibility screening will be done only in the next quarterly review in September 2023. FTSE will continue with the current free float shares of HDFC in the indices and rename the constituent with the acquirer’s name HDFC Bank with no weight changes.
Mortgage lender HDFC has acquired 612 equity shares of Xanadu Realty, representing 5.46% of its paid-up equity share capital upon conversion of 938 compulsorily convertible debentures held by it in Xanadu. The shares are acquired at Rs 4,08,501 apiece, aggregating to a total consideration of Rs 25 crore.
HDFC has acquired a 0.69% equity stake in its subsidiary HDFC Life Insurance Company through open market transactions. As per the bulk deals data available with the exchanges, HDFC has purchased 1.49 crore equity shares in the life insurance company at an average price of Rs 667.1 per share totalling Rs 992.64 crore.
Adani Group: GQG, IHC and other investors bought Adani Group shares worth nearly $1 billion in a block deal on Wednesday. Top gainers among Adani Group stocks were Adani Transmission [5.15%], Adani Ports [5.03%], Adani Transmission [5.94%], and Adani Total Gas [2.03%].
Shree Cement: Shares of the company tumbled on Monday after media reports said that the cement manufacturer has allegedly evaded Rs 23,000 crore in taxes. However, the company said in an exchange filing that any information circulating in the media is incorrect and has been published without seeking prior inputs from the company. On June 21, 2023, the Income Tax department had conducted raids at five locations of Shree Cement in Rajasthan.
Bharat Electronics (BEL): The company has received defence and non-defence orders worth Rs 2,191 crore. The orders include supply of long range guidance kit with warhead, airborne VHF/UHF communication jammers, battlefield surveillance radar systems, etc. With this, BEL has received orders worth Rs 8,091 crore till now in FY24.
Asset Management Companies (AMCs): Shares of four AMC stocks surged 8.15% to 12% after the stock market regulator Securities and Exchange Board of India (SEBI) deferred decision on overhaul in total expense ratio for mutual funds. According to media reports, Securities and Exchange Board of India (SEBI) has delayed its decision to streamline the total expense ratio (TER) for mutual funds. This comes after receiving new data from the mutual fund industry, indicating significant economies of scale.
ICICI Securities, ICICI Bank: ICICI Bank said that the board members have approved the draft scheme of arrangement for delisting of equity shares of ICICI Securities. The public shareholders of ICICI Securities will get 67 equity shares of the bank for every 100 shares held by them in ICICI Securities. As a result, ICICI Securities will become a wholly-owned subsidiary of the bank.
Bharat Petroleum Corporation (BPCL): The oil marketing company has received approval from its board of directors for raising capital up to Rs 18,000 crore. This capital will be raised via an issue of equity shares on a rights issue basis to eligible equity shareholders of the Corporation.
L&T Technology Services (LTTS): The company has partnered with Palo Alto Networks to provide 5G and operations technology solutions to various enterprises in diverse verticals. Under the agreement, LTTS will become a Palo Alto Networks Managed Security Services Partner, delivering a suite of security services to end customers in industrial verticals. LTTS’ security solutions encompass 5G, OT and IT/OT Converged SOC services.
ABB India: The company said that it has received an order from John Cockerill India to provide electrification and automation systems for ArcelorMittal Nippon Steel India’s (AM/NS India) advanced steel cold rolling mill (CRM) in Hazira, Gujarat. ABB India will provide advanced electrification and automation systems, including the ABB Ability system 800xA distributed control system (DCS) and associated equipment and components, to support enhanced energy efficiency, optimized zinc consumption and high levels of corrosion resistance throughout the steel production process.
BEML: The company has secured orders worth Rs 385 crore from Bharat Dynamics (BDL) and Bharat Electronics (BEL) for the supply of high mobility vehicles, according to its exchange filing.
InterGlobe Aviation (IndiGo): Shares of the carrier rose 4.17% to hit a fresh 52-week high of Rs 2635.15 on Thursday, taking the market capitalisation of the company past Rs 1 lakh crore. Nonetheless, the share price retreated to close at Rs 2621.10 per share, up 3.61% higher to Tuesday’s closing price.
Hindustan Aeronautics (HAL): The company said that its board has approved the sub-division of existing one equity share of face value of Rs 10 each into two equity shares of Rs 5 each. The record date for the purpose of sub-division of equity shares is 29 September 2023. Further, the company’s board has approved a final dividend of Rs 15 per equity share for FY23.
IIFL Securities: Shares of the company rose over 9% in intraday trade after media reports suggested that the Securities Appellate Tribunal (SAT) has stayed the order passed by the Securities and Exchange Board of India (SEBI) against the company. The aforementioned order issued by SEBI had barred the company from on-boarding any new clients for two years.
Infosys: The IT company said that it has signed a strategic collaboration with Danske Bank to accelerate the bank’s digital transformation initiatives. This collaboration will help Danske Bank achieve its strategic priorities towards better customer experiences, operational excellence, and a modernized technology landscape, powered by next-gen solutions.
Kotak Mahindra Bank: The private lender announced that it has allotted 1,89,500 non-convertible debentures (NCDs) having a face value of Rs 1 lakh each aggregating to Rs 1,895 crore, on private placement basis. The NCDs will have a coupon rate of 7.55% per annum and the tenure of the instrument is 7 years and 1 day from the date of allotment. The maturity is June 24, 2030. The NCDs will be listed on the National Stock Exchange of India (NSE) and Bombay Stock Exchange (BSE).
Canara Bank: The public sector lender has received board approval for its capital raising plan for FY24 amounting up to Rs 7,500 crore via debt Instruments. The bank will raise capital through Basel III compliant additional Tier I bonds to the extent of Rs 3,500 crore and additional Tier II bonds to the extent of Rs 4,000 crore during FY24.
63 Moons Technologies and MCX India: Commodity exchange operator MCX has decided to extend the support services deal with existing software vendor, 63 Moons Technologies, for six months with effect from July 1, 2023. The service cost is Rs 125 crore per quarter.
ICICI Prudential Life Insurance: The company has received a GST show cause cum demand notice for Rs 492 crore. The matter “relates to an industry-wide issue of input tax credit,” and the company believes it has availed of eligible input GST credit in compliance. It has deposited Rs 190 crore without accepting any liability.
Economy News
India’s current account deficit (CAD) declined to $1.3 billion, or 0.2% of GDP, in the January-March quarter of FY23, mainly due to moderation in trade deficit and an increase in services exports, RBI data showed.
For FY23, the current account balance recorded a deficit of 2% of GDP compared with 1.2% in FY22. India’s CAD declined to $1.3 billion in Q4FY23, from $16.8 billion in Q3FY23, and $13.4 billion in the year-ago period, the data showed.
Global Markets
The US markets closed higher on a weekly basis as upbeat economic data boosted investors’ confidence. For the week, S&P 500 rose 2.35%, Nasdaq gained 2.19% and Dow added 2.02%.
A slew of economic data was released during the week. The Commerce Department reported that its personal consumption expenditures (PCE) price index had increased by 0.1% month-on-month in May, bringing its year-over-year increase down to 3.8%, its lowest level since April 2021. The core PCE index (excluding food and energy), fell back to 4.6% on a year-over-year basis.
Meanwhile, Private sector incomes rose 0.5% in May, according to Commerce Department data, well in excess of a 0.1% increase in consumer spending. Initial jobless claims declined to 239,000, marking the sharpest drop since October 2021. Durable goods orders rose 1.7% month-on-month in May which was above consensus estimates. Orders excluding the volatile defense and aircraft segments, considered the best proxy for business investment, rose 0.7% after falling the previous month. Similarly, May new home sales rose 12.2% in May.
Separately, Apple closed Friday with a market capitalization above $3 trillion, making it the first publicly traded company to do so.
Japan’s stock markets gained over the week, with the Nikkei 225 index rising 1.2% and the broader Topix index increasing 1.1%. The Japanese currency fell to near a seven-month low of around JPY 144.8 against the US dollar. On the economic front, the core consumer price index for the Tokyo area, a leading indicator for nationwide consumer inflation, rose 3.2% year-on-year in June.
Chinese markets ended mixed, as weak economic indicators weighed on investors’ optimism amid the Chinese government planning to implement additional measures to boost the country’s economy. The Shanghai Stock Exchange index gained 0.13%, the CSI 300 lost 0.56%, and the Hang Seng Index inched up 0.14%.
A few economic data was released in China during the week. China’s official manufacturing Purchasing Managers’ Index (PMI) rose to 49 in June, an improvement from the 48.8 registered in May. The non-manufacturing PMI eased to 53.2 in June from 54.5 in May, indicating that the service and construction industries are continuing to grow at a slower pace. Further, profits at China’s industrial firms fell 18.8% year-on-year in the first five months of 2023, according to the National Bureau of Statistics.