The flat nature of closing does not reveal anything about the volatility during the week.Monday was a real test to the bulls nerves as the index saw the first serious correction in weeks .However,in a matter of 3 days the entire correction was negated helped largely by the old dependables IT and pharma.
BIG PLAYERS ACTIVITIES
Barring a minor blip on Monday ,the FII s were on a buying spree over the week .DII’s were more focused on profit taking .
Can there be smoke without fire ?
Attention is on select midcap and small caps which have seen sudden spurt in volumes in the last few weeks :-
1.Asahi India -The company manufactures float glass which is essentially a super smooth, distortion-free glass used for designing laminated glass, heat-toughened glass, and so on.While the June quarter was a setback the Sept quarter saw a good come back .Real estate sentiments are improving and the stock could be an indirect beneficiary .
2.Suven Life Sciences-Phew !! Some rally this was !After being in slumber between 40-50 ,the stock rocketed to 100 before some cool off was seen .The company is looking to list its only subsidiary ,Suven Neurosciences in US which could lead to value unlocking . Revenue generation for this company is only based on the success of the molecules and the clinical trials. Couple of interesting discoveries are on the anvil .Thus the company is looking for strategic investors in the USA as drug research has got impetus in Covid times .Clearly a case of striking the rod when the iron is hot !
3.Vedanta-Metal rally ,promoter intent to delist the stock has kept the stock on a run away rally .While the upside steam looks limited ,focus could shift to other counters like Hind Zinc,NMDC ,Hind Copper,etc which are also beneficiaries of this strong metal uptrend.
4.Dewan Hsg-From single digit to Rs 30 in the last few months ,the stock has seen some suitors in the form of Adani, Piramal group ,etc.The latter along with Oaktree Capital are vying against each other for a stake. The company owes around Rs 85000 cr to a consortium of bankers led by SBI. Oaktree’s offer of Rs 32700 cr could see potentially 40% recovery for the bankers .We have not heard the last of this as yet.
NIIT-When IT is booming ,IT education cannot be far behind .This IT training major has seen a strong resurgence and after a buyback in 2019 ,a Rs 237 cr buyback has been announced at Rs 240.On the performance front the company has been flat for the last few years .The Rs 1300 cr profit on the stake sale in its parent company has boosted cash flow .In terms of business opportunities ,Managed Training Services on a global level is the opportunity the company is betting on.
WHAT DOES THE COMING WEEK HOLD ?
1.The Govt is pressing the gas pedals on PSU disinvestment .After the push on BPCL,SCI and Air India , focus is now on the likes of BEML ,ITDC .
2.The Govt has challenged the Vodafone retrospective tax case verdict with an appeal to the Singapore court. Last week an international Court turned down a similar claim on the Cairn Energy Plc as it was inconsistent with the UK-India bilataral treaty.
3.The New Year could be a year of recoveries for banks, PSU s in particular .DHFL as a case clearly points towards that .Sentiments towards PSU banks still remains tepid going by the lukeworm response for the Canara Bank ,PNB fund raising experience .Strong recoveries could be the right tonic for the beleaguered banks.
4.The real estate which was hard hit by Covid seems to be on a revival mode going by the DLF ‘s latest sale of 90 independent floors worth Rs 300 cr .Demand is supposed to be buoyant as the company now plans a similar launch.
The market is bracing for a year end rally and an euphoric dash to 14000 on the Nifty is on cards .
Wishing all readers a very Happy New Year ! May the New year bring good health ,peace and prosperity
Did you know ?
Airbnb got listed and closed at $155 against the offer price of $68.The company is a platform for providing accommodation to tourists and residents worldover . It is now more valuable than the seven largest hotel chains in America combined and worth more than $100 bn which is a whopping 4000 times its 2020 earnings !Retail frenzy it is for sure and now with such high expectations ,the company earnings has got some steep catching up to do unless the stock comes down to more credible levels .Keep watching !!
Some stray thoughts –
Last week ‘s resounding listing of Mrs Bector Food was not only a hallmark of the company ‘s achievement but also the triumph of will and determination of a woman way back in the 1970 s. Starting with an initial investment of Rs 20000 ,the foundation was laid for the initial enterprise of making churned ice cream in her backyard .Branding soon followed with “Creamica” which was just forged out of “cream ka”and the company went on to make breads,biscuits,buns and sauces .The big turning point came when McDonald chose Cremica for supplying buns.The company also manufactures premium biscuits Oreo and Chocobakes for Mondelez India .The company contributes 12% of the biscuit exports from India !
Saluting this enterprising woman on her achievement ,this is sure to fire the imagination of many more such forward looking entrepreneurs in our country!