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Domestic stock indices fell for the week as investors were concerned about the global inflation outlook and persistent selling by the foreign institutional investors. For the week, the Sensex closed 3.02% lower at 57011.74 and the Nifty tumbled 3% to 16985.20. Broader markets also bore the brunt as BSE Midcap tanked 4.53% and BSE Smallcap index plunged 2.75%.
Foreign Institutional Investors have sold for Rs 10452.2 crore in the cash segment in the past one week, while Domestic Institutional Investors have bought for Rs 6341.1 crore. Since April 2021, FIIs have sold for Rs 135532.9 crore in the cash segment. Only in the month of September they have been net buyer for Rs 463.8 crore. In November, they had sold for the maximum amount of Rs 39901.9 crore. DIIs have bought for Rs 106397.5 crore since April 2021. DIIs have been net buyers in all months of fiscal 2022.
For the week, Nifty IT was the only sectoral index which closed in the green. Nifty IT rose 1.97% for the week. Top Nifty sectoral indices losers were Realty [-8.4%], Media [-8%], PSU Bank [-7.8%], FMCG [-4.6%], Bank [-4%], Infra [-3.8%], Auto [-3.6%], Metal [-3.2%].
Nifty 500 which tracks the top 500 stocks by market cap in NSE fell by 3.18% for the week. Top losers in Nifty 500 index were Network 18 [-18.8%], Macrotech Developers [-16%], Gujarat Fluorochemicals [-15.8%], Shriram Transport Finance [-15.3%] and IDBI Bank [-14.6%].
Top gainers were Tata Teleservices Maharashtra [27.6%], Bajaj Electricals [16.7%], Vardhman Textiles [13.5%], KPR Mill [13.5%] and Minda industries [11.2%].
Company News
Reliance Industries Ltd (RIL) and Sintex Industries Ltd: The conglomerate along with a partner, are among those bidding to take over bankrupt Indian textile firm Sintex Industries Ltd., according to a stock exchange filing by Sintex. RIL is partnering with Assets Care & Reconstruction Enterprises Ltd. to bid for Sintex Industries under a court-designated bankruptcy resolution process.
Meanwhile, RIL is expected to get the first cargo of oil from its new Abu Dhabi-based trading unit in December, according to a source familiar with the matter, Reuters reported. The company aims to get about a 5 lakh barrels of cargo of United Arab Emirates’ Das crude from Reliance International Ltd (RINL), the source added.
Infosys: The IT major’s subsidiary, Infosys Consulting, is acquiring Singtel’s delivery centre in Malaysia. The cost of the transaction is up to 6 million Singapore dollars, including the value of net assets, subject to customary closing adjustments. This deal will bolster Infosys presence in Malaysia, a strategic delivery and sales hub in South East Asia for global clients.
In other news, Infosys has announced extension of its digital innovation partnership with Australian Open until the end of 2026. Tennis Australia and Infosys will continue to harness big data and analytics, artificial intelligence, virtual reality and cloud technologies to elevate the viewing experience.
Vodafone Idea Ltd (VIL): The telecom company is likely to get equity infusion from owners Vodafone Group Plc and Aditya Birla Group, according to a news report by Economic Times. Vodafone Idea is expected to complete the capital raise by March 2022. Vodafone Idea is aiming at a four-fold jump in annual capital expenditure to $2 billion.
Airtel: The telco has paid up Rs 15,519 crore to the government as pre-payment of the entire liability of spectrum it acquired in 2014 auctions, the company said in a statement. The company estimates that the prepayment will likely result in interest cost savings of at least ₹3,400 crore over the residual life for fully substituted capital.
State Bank of India: The public-sector lender said it is planning to offload 6% of its stake in its mutual fund venture through the initial public offering route. SBI currently holds 63 per cent stake in SBI Funds Management Private Ltd and the remaining 37 per cent stake is held by AMUNDI Asset Management through a wholly owned subsidiary, Amundi India Holding. The lender did not give any timeline for the listing.
Hindustan Aeronautics Limited (HAL) and Bharat Electronics Limited (BEL): HAL has signed a contract with BEL for the development and supply of 20 types of systems for the Light Combat Aircraft (LCA) Tejas Mk1A program in Bengaluru. The five-year contract starting from 2023 is valued at Rs 2,400 crores and involves supplying critical avionics Line Replaceable Units (LRUs), flight control computers and night flying LRUs.
Paytm: Shares of the company closed 7.76% lower as the mandatory one-month lock-in period for anchor investors expired on December 15, 2021. the company shares have been on a downward trend since the day of listing. The company has fallen 35.81% from its issue price of Rs 2150 per equity share.
Adani Green Energy: The company has inked an agreement with state-run Solar Energy Corporation of India (SECI) to supply 4667 MW of green energy. “This is yet another step in our journey to enable India’s dual objective to accelerate India’s renewable energy footprint as well as promote domestic manufacturing under the Aatmanirbhar Bharat programme, said Gautam Adani, Chairman of the Adani Group.
Aditya Birla Fashion and Retail: The retailer has inked a long-term licensing agreement with Authentic Brands Group (ABG) to distribute and sell Reebok products in India and other ASEAN (Southeast Asian) countries. “The addition of Reebok, a marquee global sports and activewear brand will fill an important white space in ABFRL’s portfolio,” the company said in a statement.
Vedanta Group: The Anil Agarwal-led group said it has withdrawn cases in the Delhi High Court as well as before an international arbitration tribunal to settle a Rs 20,495 crore retrospective tax dispute with the government. In a statement, Vedanta said it has used the recently enacted law that scraps all demands levied using a 2012 retrospective tax legislation, to settle the dispute.
ITC: The company’s chairman Sanjiv Puri talked about demerger possibilities for the FMCG business and listing infotech business at ITC’s first institutional investors and financial analysts meeting. He also discussed the demerger plans of its hotel business and said the company will take action once the hospitality industry recovers.
RateGain Travel Technologies: The SaaS company made a weak stock market debut, as it got listed at 15% below its issue price. The stock got listed at Rs 360, a 15 per cent discount to its issue price of Rs 425 per share on the National Stock Exchange. Shares of the company closed almost 20% lower at Rs 340.05.
Economy News
India’s retail inflation based on Consumer Price Index (CPI) rose to a three-month high of 4.91% in November this year, government data showed. The retail inflation had risen to 4.48% in October from 4.35% in September. The country’s inflation based on wholesale price index (WPI) surged to 14.2% on the back of higher food prices and crude prices. It had jumped to 12.54% in October.
India’s index of industrial production (IIP) grew by 3.2% in October 2021, according to the data released by the statistics agency. Industrial output, as measured by IIP, jumped 4.5% in October 2020 and surged 3.1% in September. Meanwhile, the mining output during October 2021 rose by 11.4%, while, manufacturing sector output jumped 2%. Electricity generation in October grew 3.1%.
India’s merchandise exports jumped 27.16% to $30.04 billion in November, official data showed on Tuesday. Imports in November were at $52.94 billion, an increase of 56.58% over the year-ago period. According to government data, trade deficit in November stood at $22.91 billion.
Global Markets
In the US markets, stocks indices closed lower for the week, as investors were concerned over the prospect of central bank tightening and the negative impact of the omicron variant of the coronavirus. The central bank’s monetary policy decision dominated the market during the week. The Fed indicated that it would raise the interest rate three times in 2022 and again 3 times in 2023 as well as 2 times in 2024. It also said that there would be faster tapering of its monthly bond purchases and it is expected to stop by the end of March. Growth stocks and the technology-centric Nasdaq Composite index performed the worst. For the week, the S&P 500 plunged 1.94%, the Dow lost 1.68% and the Nasdaq tanked 2.95%.
Japanese equities rose during the week, as investor sentiments were boosted by the country’s central bank decision to remain dovish and the prospects of global economic recovery. The central bank also extended its special program, which was launched in response to the coronavirus, to support financing, mainly of small and medium-sized firms, by six months until the end of September 2022. Japan’s exports rose 20.5% in November from year-ago period, driven by a recovery in auto shipments that suggested supply chain bottlenecks are likely easing. Exports to China, the U.S., and the European Union witnessed strong recovery. The Nikkei 225 index gaining 0.38% and the broader TOPIX index rose 0.46%.
Chinese markets fell for the week amid an increase in global coronavirus cases and U.S.-China tensions after Washington imposed sanctions as well as investment and export restrictions on dozens of Chinese companies for their role in allegedly systematic abuse of China’s Muslim minorities and in supporting Beijing’s military. The CSI 300 index fell 1.9%, and the Shanghai Composite index shed 0.9%.