WEEKLY TRENDSETTER (SEPT 13,2024)
| 2024 | AUG 30 | SEP 6 | Ch % |
| NIFTY | 25235 | 24852 | -1.52 |
| BANK NIFTY | 51351 | 50577 | -1.51 |
| USD/INR | 83.86 | 83.83 | -0.04 |
MARKET REVIEW-The week saw momentum falter and by end of week selling pressure emerged which took the index below 25000 wiping out large part of the gains registered in a record run of 14 days. The global cues have also turned negative and the beginning of the fresh week could see nervous sentiments.
INTERESTING CUES
KAYNES ENTRY INTO SEMI-CONDUCTOR GETS GREEN SIGNAL
The company has got approval for setting up of a semi-conductor unit in Gujarat at an investment of Rs 3300 cr and capacity to produce 60 lac chips per day. In Feb 2024 ,3 more such units were approved. While Tata Electronics is setting up 2 plants in Gujarat and Assam, CG Power is setting up a unit in Gujarat. These approvals are part of a plan to set up a semiconductor eco system in the country with an outlay of Rs 76000 cr decided in Dec 21.
PV INVENTORIES REACHING ALARMING LEVELS
While the stock days have stretched to 70-75 days, the total number of pile up stands at nearly 8 lacs vehicles valued at Rs 80000 cr. While 2-wheeler and 3-wheeler segments have managed to show positive growth, the coming festival season will be critical. The good rains should boost prospects of rural demand and the industry remains optimistic about a revival post monsoon
GSPL, GSPC, GEL TO MERGE INTO GUJ GAS
Shareholding arrangements under the scheme include the issuance of 10 equity shares of Rs 2 each in Gujarat Gas for every 305 equity shares of Rs 1 each held in Gujarat State Petroleum Corporation. Similarly, Gujarat State Petronet shareholders will receive 10 equity shares of Rs 2 each in Gujarat Gas for every 13 equity shares of Rs 10 held.
Gujarat Gas will be able to make “quick use” of the Rs 72,000 crore carry-forward losses in Gujarat State Petroleum Corporation. Also, there is a higher intrinsic value of both GSPC and GSPL.
Regarding the new transmission entity, Gujarat Gas shareholders will receive 1 equity share of Rs 10 each in GSPL Transmission Limited (GTL) for every 3 equity shares of Rs 2 held in Gujarat Gas.
The scheme involves the demerger of GGL’s Gas Transmission Business, which will be carved out and listed separately as GSPL Transmission Limited (GTL) on stock exchanges.
Gujarat Gas has seen brokerage upgrades on the back of this merger news
NIFTY –The index looked well on the path to 25500. However, by mid-week the sentiment turned negative as US markets began to falter and while 25000 was expected to hold, this also gave way and by close the weekly index had formed an engulfing bearish candle which could keep bulls on the sidelines. Immediate support lies at 24600 where short covering could emerge and on the upside 25000-25100 could pose a hurdle.
BANK NIFTY-The index was an underperformer and the PSU banking stocks in particular saw heavy selling and by close were close to the 200-dma or below that which hints at a change in the broader trend for these banks.
PICKS FOR THE WEEK
SBIN (783)-The stock was trading in a narrow band for large part of the week before a sharp dip breached the critical 800 levels on huge volumes. This could trigger further selling in the coming week. Selling could be considered for possible target of 740-50 in the coming week which also is the 200 -dma.
Canbank (103) -The stock has breached 200-dma of 108 on huge volumes which could now gather momentum in the coming days. While ideally a pull back to 113-15 would be better to sell, current indications are that the stock could seek lower levels of 95-100 in the coming days.
Wishing all readers, a great trading week!
Note: Any queries /clarifications may be addressed to stockmasala@gmail.com .
Krish Subramanyam