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Benchmark stock indices ended with significant gains during the week, aided by positive investor sentiments, cooling oil prices and strong FII inflows. For the week, the Sensex rose 1.68% to 59,793.14. The Nifty 50 index added 1.68% to settle at 17,833.35. For the week, the BSE Midcap index climbed 1.86% to 25,937.22. The BSE Smallcap index jumped 2.53% to 29,528.74.
Top gainers among Nifty 50 stocks were Shree Cements [16.2%], Tech Mahindra [6.7%], Adani Ports [6.4%], Bharat Petroleum [5.1%] and Axis Bank [4.6%]. Top losers were Bajaj Auto [-4.5%], Tata Motors [-3.4%], Nestle India [-2.6%], Tata Consumer Products [-2.1%] and Britannia [-1.5%].
Top gainers among Nifty sectoral indices were PSU Bank [4.34%], IT [3.53%], Media [3.16%], Bank [2.52%], Metal [2.34%]. Nifty Auto [-0.01%] was nearly flat.
During the week, FIIs were net buyers for Rs 6,136.6 crore and DIIs were net sellers for Rs 352.1 crore.
The WTI Crude stood at $86.79 per barrel and the Brent Crude stood at $92.84 a barrel.
The Indian rupee closed at 79.58 against the US dollar on Friday.
Company News
Reliance Industrial Ltd (RIL): The company’s fourth investment cycle of an estimated $50 billion over the next three years could boost the firm earnings, a report by investment firm Morgan Stanley said. “The investments in new energy and retail expansion to take market share from unorganized sector, and repurposing of existing energy business gives RIL a long runway to deliver earnings growth consistently even beyond the next three years,” it said.
Further, the company has signed a definitive agreement to acquire a majority stake in SenseHawk Inc for a total transaction value of $32 million, including funding for future growth, commercial rollout of products, and R&D. SenseHawk is a Solar Digitization Platform (SDP) with customers throughout the solar asset lifecycle in the US, EMEA, APAC, and SEA.
Meanwhile, the company’ subsidiary, Reliance Retail Ventures Ltd (RRVL), has acquired a controlling stake in make-up and personal care brand Insight Cosmetics, Livemint reported citing two sources. The deal was valued at $10-15 million, one of the people said, requesting anonymity.
Adani Group: Billionaire Gautam Adani said his ports-to-power conglomerate will build three giga factories in India for manufacturing solar modules, wind turbines, and hydrogen electrolyzers as part of a $70 billion investment in clean energy by 2030. He added that these new factories will generate an additional 45 GW of renewable energy to Adani group’s existing 20 GW capacity, as well as 3 million tons of hydrogen by 2030.
Fitch Group’s research arm, CreditSights, has admitted to calculation errors in its recent debt report with respect to two Adani Group companies. CreditSights corrected Adani Transmission’s EBITDA estimate to 52 billion rupees from 42 billion rupees earlier. The research firm also corrected Adani Power’s gross debt estimate to 489 billion rupees from 582 billion rupees in the earlier report.
Gautam Adani is searching for a new leader for his mergers and acquisitions (M&A) strategy, according to Bloomberg news report. Vinod Bahety – who’s been helming Adani Enterprises M&A activity – will move to a new business vertical soon, the report said citing sources.
Tata Motors: The automaker said that it will roll out the electric version of its entry-level car, Tiago, later this month. The new electric vehicle (EV) would be the company’s third EV product after Nexon and Tigor. Tata Motors aims to introduce 10 electric models over the next five years.
In other news, Tata Motors has launched the country’s first CNG truck in the medium and heavy commercial (M&HCV) vehicle segment in the 28- and 19-tonne nodes. The company also launched a fleet of trucks in the intermediary and light commercial vehicle (I&LCV) segment, meant for varied applications. With the launch, Tata Motors is hoping to create strong differentiation and recoup some market share it has had lost in recent months.
Mahindra & Mahindra (M&M): The company said its total production of automobiles soared 82.87% to 60,751 units in August 2022 as compared with 33,220 units sold in the same period a year ago. The company’s total sales zoomed 104.84% to 56,137 units in August 2022 as against 27,405 units sold in August 2021. Meanwhile, exports for the period under review stood at 2,912 units, a decline of 8.43% year-on-year.
PVR and Inox Leisure: Multiplex operator PVR will meet its shareholders and creditors on October 11 to seek their approval for the scheme of merger with rival company Inox Leisure. The development comes after the Mumbai bench of the National Company Law Tribunal (NCLT) on August 22 directed PVR to arrange for a meeting.
Vodafone Idea (VIL): The Finance Ministry has cleared a proposal to convert the accrued interest on dues related to deferred adjusted gross revenue (AGR) worth Rs 16,130 crore of Vodafone Idea into equity, according to Economic Times report. The telecom department will now have to finalise the transaction according to the package announced earlier.
State Bank of India (SBI): The country’s largest lender issued additional tier-1 (AT1) bonds worth a total of Rs 6,872 crore at a cut-off of 7.75%, the lowest rate set for such debt issuances by any bank so far in the current financial year, Business Standard reported. “There was already assured demand for a large portion of the notified amount of SBI’s bonds,” the report said citing a senior treasury official.
HDFC Bank: The private sector lender on Tuesday sold additional tier-1 (AT-1) bonds worth Rs 3,000 crore at a cut-off rate of 7.84%. The bond sale is the first time that a private bank has tapped the debt capital markets by issuing AT-1 bonds in the current fiscal year.
Bharti Airtel: Singtel entities have offloaded a 1.76% stake in the telcom company for about Rs 7,128 crore, PTI news agency reported citing sources. According to the bulk deal data available with the exchange, Bharti Telecom, Airtel’s promoter, have purchased 9,62,34,427 shares (1.63% stake) at an average price of Rs 686 apiece. Another entity, Viridian, has offloaded about 1 crore shares.
InterGlobe Aviation (IndiGo): Rakesh Gangwal, co-founder of IndiGo, and his family are looking to sell a 2.8% stake in InterGlobe Aviation, the holding company which runs IndiGo airlines, through a block deal. Morgan Stanley, one of the investment banks looking after the sale, launched a block deal, according to a notification to the stock exchanges. As part of the block deal, about 10.8 million shares have been listed for sale for Rs 19.96 billion. The shares are listed at Rs 1,850 apiece as against the company’s closing price of Rs 1,977.70 on September 7.
Meanwhile, the carrier said that Pieter Elbers has joined as the new chief executive officer (CEO) with effect from September 6. He succeeds Ronojoy Dutta, who retired last week. Elbers has served as the president and CEO of KLM Royal Dutch Airlines since 2014.
Infosys: The IT firm has announced a five-year agreement with Spirit AeroSystems. Infosys will collaborate with Spirit AeroSystems to provide aerostructure and systems engineering services for product development of commercial, business jet and emerging aircraft programs, and Maintenance, Repair and Overhaul (MRO) services.
One 97 Communications (Paytm): In an exchange filing on Tuesday, the fintech firm said its lending business witnesses a 246% YoY growth during the two months ending August 2022. The number of loans disbursed stood at 6 million loans in two months ending August 2022, while the value of loans disbursed grew 484% YoY to Rs 4,517 crore. The company reiterated that it continues to see ample growth and upsell opportunities in this business and focusing on the quality of the book. The total merchant gross merchandise value (GMV) processed through the platform for the two months ended August 2022 aggregated to Rs 2.10 lakh crore ($26 billion), registering a growth of 72% YoY.
Bharat Petroleum Corp (BPCL): The oil refiner is planning to charter a ship to load 700,000 barrels of Russia’s Sokol crude oil this month, Reuters reported citing sources familiar with the deal. The cargoes could not be loaded and lifted earlier in May as ship insurance cover had not been available then due to pressure from Western sanctions against Russia for its invasion of Ukraine, the report said.
Indian Oil Corporation (IOC): Thyssenkrupp Industrial Solutions India said it has bagged a $75-million EPC contract from the oil major, Indian Oil Corporation, to construct a catalytic dewaxing unit (CDWU) at its Baroda refinery in Gujarat. The proposed CDW unit will have an annual capacity of a 270-kilo tonne.
Jubilant FoodWorks: The company said that Sameer Khetarpal has joined as chief executive officer and managing director. Shareholders have also approved his appointment in the recently concluded AGM of the company.
Economy News
The seasonally adjusted S&P Global India Services PMI Business Activity Index rose from July’s four-month low of 55.5 to 57.2 in August, indicating a rebound in growth. The expansion in the service sector was attributed to stronger gains in new business, ongoing improvements in demand, job creation and overtime work.
Meanwhile, the S&P Global India Composite PMI Output Index rose to 58.2 in August from 56.6 in July. Aggregate output growth in the country’s private sector recovered in August compared to July as manufacturers and service providers witnessed faster rate of increase. A reading of 50 indicates an expansion of activity in the sector.
India’s foreign exchange reserves fell by $7.94 billion to $553.11 billion for the week ended September 2, the lowest since October 9, 2020, the Reserve Bank of India (RBI) said. The fall in reserves was due to a decline in foreign currency assets to $492.12 billion, down from $498.65 billion in the prior week. Meanwhile, Gold assets dropped to $38.30 billion as on September 2, from $39.64 billion in the week prior.
The provisional gross direct tax collections for FY23 till September 8 stood at Rs 6.48 trillion, a rise of 35.5% compared to the same period last year, the Finance Ministry said in a statement on Friday.
Global Markets
The US markets ended higher as investors bought beaten down stocks amid concerns over the country’s economic growth forecast. For the week, the Dow gained 2.7%, the S&P 500 surged 3.6% and the Nasdaq climbed 4.1%.
A survey from the Institute for Supply Management (ISM) indicated that the US services industry expanded in August for the second straight month, helped by stronger order growth and employment, while supply constraints and higher prices eased. The ISM non-manufacturing PMI edged up to a reading of 56.9 in August from 56.7 in July, an increase for the second straight month after three months of decline.
China’s stock markets rose as the country’s central bank reiterated its support for the economy and rise in exports. The Shanghai Composite index umped 2.4%, the CSI 300 index, which tracks the largest listed companies in Shanghai and Shenzhen, added 1.7% and Hang Seng index rose 2.7%.
The People’s Bank of China said it would cut the foreign exchange reserve requirement ratio to improve the ability of financial institutions to use foreign exchange funds and slow the pace of Yuan’s depreciation. Further, China’s exports rose 7.1% in August compared with the same period a year ago, official data showed. Imports inched up 0.3%, less than 2.3% increase in July. The country saw a trade surplus of $79.39 billion in August driven by weaker import numbers, after it saw a record $101.26 billion in trade surplus in July.
Japan’s stock markets rose during the week as the government took measures to help the country’s economy cope with rising inflation. For the week, the Nikkei 225 index gained 2.04% and the broader Topix index was up 1.83%. The Japanese currency depreciated to around JPY 142 against the U.S. dollar, from about JPY 140 the prior week.
The Japanese government announced a new package, which includes cash handouts to low-income households and also maintain prices of some commodity and food articles at current levels. Prime Minister Fumio Kishida said that it was the government’s priority to protect both households and businesses from the negative effects of elevated import prices due to the Russia-Ukraine war.
Meanwhile, the au Jibun Bank Japan Services Purchasing Managers’ Index dropped to a seasonally adjusted 49.5 for August, lower than 50.3 in July. The marginal decline signalled first contraction in service sector business activity.