SGX Nifty Up 57 Points, Fund Raising Activity in 2020, Suryoday Small Finance Bank IPO, and Buzzing Stocks Today

Wed, 30 Dec Pre-Open | Monish Vora, TM Team

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Extending gains to the fifth straight day, Indian share markets ended higher yesterday.

After scaling fresh peaks in opening trade, benchmark indices erased some gains in the afternoon session. However, indices regained momentum during closing hours amid buying in financial stocks.

At the closing bell yesterday, the BSE Sensex stood higher by 259 points.

The NSE Nifty stood higher by 59 points.

IndusInd Bank and Tech Mahindra were among the top gainers. Nestle, on the other hand, was among the top losers.

The BSE Mid Cap index ended down by 0.1%. The BSE Small Cap index ended higher by 0.2%.

The BSE Smallcap index rose to 31-month high after domestic mutual funds and insurance companies acquired select companies' share from open market.

Sectoral indices ended on a mixed note with stocks in the banking sector and finance sector witnessing buying interest.

Metal stocks and power stocks, on the other hand, witnessed selling pressure.

At 8:00 am today, the SGX Nifty was trading up by 57 points, or 0.4% higher at 13,990 levels. Indian share markets are headed for a positive opening today following the positive trend on SGX Nifty.

Gold prices were trading up by 0.2% at Rs 50,129 per 10 grams at the time of closing stock market hours yesterday.

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Top Stocks in Focus Today

Among the buzzing stocks today will be Punjab National Bank.

Leading public sector bank Punjab National Bank (PNB), has successfully completed the IT integration of all branches of erstwhile United Bank of India.

This is in continuation to the IT integration of all branches of erstwhile Oriental Bank of Commerce, undertaken in November 2020.

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With this PNB has concluded the integration and migration of databases of both banks, which brings all the customers on a common platform and enables them to transact seamlessly across the banks' network as well as PNB's digital banking platforms like internet banking and mobile banking.

Wipro share price will also be in focus today as the company's proposal to return around Rs 95 billion to shareholders through share buyback began yesterday and will close on January 11, 2021.

The last date for settlement of bids on the stock exchange will be on or before January 20, 2021.

Last month, shareholders had approved Wipro's buyback plan for the purchase of up to 237.5 million equity shares at Rs 400 per share, aggregating to an amount of up to Rs 95 billion.

Wipro had last year undertaken a buyback programme of 323.1 million shares at Rs 325 apiece, aggregating to about Rs 105 billion. Before that, Wipro had announced a buyback worth Rs 110 billion in 2017 and Rs 25 billion in 2016.

Market participants will also track ICICI Bank share price as the company said it has joined hands with Google Pay for issuance of FASTag, a reloadable tag which enables automatic deduction of toll charges and lets users pass through the toll plaza without stopping for cash transactions.

FASTag is a brand name owned by Indian Highways Management Company, which carries out electronic tolling and other ancillary projects of National Highway Authorities of India (NHAI).

IPO Buzz: Suryoday Small Finance Bank Receives Nod to Launch IPO

In latest developments from the IPO space, the markets regulator has granted the go-ahead to small lender Suryoday Small Finance Bank to float its initial public offering (IPO).

The IPO comprises fresh issuance of 1,15,95,000 equity shares and an offer for sale of up to 84,66,796 equity shares by existing shareholders, according to the draft papers.

Those offering shares through the OFS route include International Financial Corporation, Gaja Capital, HDFC Holdings, IDFC First Bank, Kotak Mahindra Life Insurance Company, DWM (International) Mauritius and Americorp Ventures.

Suryoday Small Finance Bank has proposed to utilise the net proceeds from the fresh issue towards augmenting its Tier-1 capital base to meet future capital requirements.

How this IPO sails through remains to be seen.

Fund Raising Activity in 2020: Of Divestments, IPOs, Rights Issues, and QIPs...

In news from the financial markets space, the coronavirus pandemic dealt a blow to the government's plan to raise funds through major stake sales and initial public offerings (IPOs).

So far this year, the government managed to raise just Rs 428.7 billion, down 37% from the Rs 681.8 billion it had raised in 2019, according to Prime Database, a data provider on capital markets.

Divestments this year were led mostly by exchange traded funds (ETFs). During the year, ETFs at Rs 165 billion with a 39% share were the most-used mode, followed by central public sector enterprises (CPSEs) sale at Rs 138.8 billion, public offerings at Rs 109.9 billion, buybacks at Rs 8.4 billion and remittances from Specified Undertaking of The Unit Trust of India at Rs 6 billion.

However, domestic companies managed to raise record amounts of capital this year. Fundraising through public equity markets hit a record Rs 1.7 trillion in 2020, surpassing the previous high of Rs 1.6 trillion in 2017.

Capital raised by India Inc. this year was more than double of last year's Rs 822.4 billion and Rs 626.5 billion in 2018.

There were 15 IPOs which collectively raised Rs 266.1 billion, more than double of the Rs 123.6 billion raised through 16 IPOs in 2019. SBI Cards' Rs 103.4 billion share sale was the biggest IPO of 2020.

Activity in the SME IPO segment declined. There were only 27 SME IPOs during the year, which raised a total of Rs 1.6 billion. This marked a sharp decline from 51 IPOs in 2019 totaling Rs 6.2 billion.

Rights issues were also at a record high, mostly led by the mega Rs 531.2 billion rights issue of Reliance Industries.

Meanwhile, 26 companies mobilized Rs 845 billion through QIPs, a record for a calendar year. This was more than double of the Rs 352.4 billion raised last year. ICICI Bank made the biggest QIP, raising Rs 150 billion.

We will keep you updated on the latest developments from this space. Stay tuned.

And to know what's moving the Indian stock markets today, check out the most recent share market updates here.

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