25 June 2021 Stock Market News

Stocks in the News Highlights (25-June-2021)

1) Domestic equity Mutual Funds witnessed inflows of Rs 22600 crore in equity oriented funds in the three-month period from March 2021 to May 2021.

The domestic mutual fund industry witnessed outflow of ~Rs 47000 crore from July 2020 till February 2021. This was due to redemption pressure witnessed in equity oriented funds and lower equity allocation in balanced advantage funds (funds that invest in equity, debt and others). Outflows were also witnessed in equity oriented hybrid funds like aggressive hybrid fund category. 

The trend, however, seems to be reversing from mid-March 2021 as domestic mutual funds have bought equity shares worth more than Rs 16000 crore. 

2) LIC will infuse equity capital worth about Rs 2,334.70 crore in its subsidiary LIC Housing Finance by picking up an additional stake in the company. LIC Housing Finance (LIC HFL) will issue shares at Rs 514.25 apiece to its promoter Life Insurance Corporation of India (LIC) on a preferential basis.

3) State-owned aerospace and defense electronics maker Bharat Electronics BEL reported a 31% year-on-year growth in its profit for the March quarter. During the same period, its sales rose by 18% to ₹6,757 crore.

4) State-owned Union Bank of India has raised ₹850 crore by issuing Basel-III-compliant bonds on a private placement basis. e. The tenor of the bond is 10 years and it has a coupon rate of 7.19 per cent per annum. The lender said there is a call option on the bonds which can be applicable on or after the fifth year from the date of allotment (June 24, 2021).

5) Crystal Ceramics Industries, a subsidiary of Asian Granito India Limited (AGIL), has invested Rs 25 crore for capacity expansion at its Mehsana plant in Gujarat. This capacity addition to increase the total capacity of Crystal Ceramics to 36,000 SQMTS/day. Asian Granito holds 70 per cent of equity in Crystal Ceramics Industries.

6)  Tyre maker Ceat said it has launched a new range for compact SUVs. SecuraDrive range would cater to the fast-growing compact SUV segment. The new range of tyres offers numerous benefits like precise steering control and cornering stability, it added. The tyres offer superior braking, low in-cabin noise and a comfortable drive, the tyre maker said.

7) Reliance AGM 2021 Highlights

Retail shareholders have made 4x returns in just one year on their rights shares

Reliance achieved a net debt-free balance sheet much ahead of its target of March 2021.

Reliance welcomed Saudi Aramco as a strategic partner. Yasir al-Rumayyan, chairman of Saudi Aramco joins RIL Board.

RIL is developing the Dhirubhai Ambani Green Energy Giga Complex on 5,000 acres in Jamnagar.

RIL to invest around Rs 75,000 crore in the new energy business.

Reliance in collaboration with Google announced ‘JioPhone Next’ - the most affordable smartphone.

Reliance Jio to partner with Google Cloud for 5G, trials in progress. Jio is doing a trial run with Facebook to integrate JioMart with WhatsApp.

Reliance created 75,000 new jobs during the financial year. JioFiber has become the largest and fastest-growing fixed broadband operator in India with 3 million active users.

“In the coming decade, Reliance has the capacity to catalyze investments of over $200bn directly and through partners,” said Mukesh Ambani.

Financial highlights announced at the AGM:

Consolidated revenue was at Rs. 5,40,000 crores. Consolidated EBITDA was at Rs. 98,000 crores

50% of EBITDA was contributed by consumer businesses. 6.8% of India’s merchandise exports

Reliance stock price closed at Rs. 2,153.50, down by 2.35%.

8) The shares of Shyam Metalics listed at Rs 380 per share on the NSE which is a 24% premium from the issue price of Rs 306 per share. Shyam Metalics listed at Rs 367 on the BSE, 20% premium.

The Shyam Metalics IPO was subscribed 121.4 times between June 14 and 16, 2021. The retail portion was subscribed 11.58 times. The stock price closed at Rs 376.15 and was up by 22.92%.

9) The shares of Sona Comstar listed at Rs 302.4 per share on the BSE which is a 4% premium to the issue price of Rs 291 per share. Sona Comstar listed at Rs 301 on the NSE, a 3.4% premium.

The Sona Comstar IPO was subscribed 2.28 times between June 14 and 16,2021. The retail portion was subscribed 1.57 times. The stock price closed at Rs. 361.20 and was up by 24.12%.

10) UK’s central bank’s Monetary Policy Committee voted unanimously to keep the main lending rate at a historic low of 0.1%

11) Wipro announced that US-based Wipro IT Services, a wholly-owned step-down subsidiary of the company, has raised $750 million by the issue and allotment of 1.50% notes to qualified institutional buyers.

12) Cipla will work with the Institute of Risk Management, India Affiliate (IRM India Affiliate) to strengthen its risk ecosystem.

13) Tata Motors: The firm has confirmed that Guenter Butschek will step down from his role as chief executive and managing director from June 30.

14) As many as 5,000 wholesale distributors of Tata Consumer Products in Kerala are observing a token strike on Thursday against the company’s decision to terminate the business contract of a few of the distributors.

15) Indian rupee heads for the fourth weekly decline following surge in crude oil prices and stronger dollar index. The forward markets indicating steady opening for the rupee. On Thursday, rupee gains 12 paise to 74.17 a dollar, snapping two days of down tick. 

16) President Joe Biden reached to tentative deal of $579 billion infrastructure plan, saying it would create millions of jobs while fulfilling a major piece of his economic agenda. The deal announcement lifted the broader US market. Following strong US market Asian markets set to open higher. The Dow Jones Industrial Average jumped 322.58 points to reach 34,196.82. The S&P 500 reached a fresh record of 4,266.49 after gaining nearly 0.6%.

17) IPO stocks have not always lived up to expectations. In fact, the majority end up seeing the stock price fall an average of 14% within six months of the public offer. One trader has put the lifecycle of an IPO stock into an interesting strategy that might just help not lose money in hot new stocks.

Kathy Donnelly, equities trader and co-author of, The Lifecycle Trade, argues that IPO stocks go through three stages during the first years of being public. 

a) In the IPO Advance Phase, the initial enthusiasm for the IPO shoots shares higher. 

b) After that wears off, the stock goes through an Institutional Due Diligence Phase where the stock price may trade sideways for a while while big money investors and funds decide if they want to invest in the shares. 

c) Finally, the stock enters the Institutional Advance Phase where institutional money flows in and lifts the shares for a longer-term picture.

18) Globally, China dominates the home textile trade with a share of 39% followed by India's share of 11%. However, India has made significant inroads into capturing noteworthy market share in the US cotton bed linen industry. The trajectory of market share gains accelerated as companies started looking at diversifying their sourcing vendor base with reducing dependency on China. 

19) India Pesticides Limited is one of the fastest growing agro-chemicals company in terms of volume of Technicals manufactured. The company is the sole Indian manufacturer of five Technicals and among the leading manufacturers globally for Captan, Folpet and Thiocarbamate Herbicide in terms of production capacity. They have diversified into manufacturing herbicide and fungicide Technicals and active pharmaceutical ingredients. The company also manufactures herbicide, insecticide and fungicide formulations. Technicals are exported to over 25 countries including Australia and other countries in North and South America, Europe, Asia and Africa. The company s formulations products are primarily sold domestically through their extensive network of dealers and distributors.