Indian Indices End Flat, Asian Paints and Dr Reddy's Laboratories Among Top Nifty Gainers

Tue, 16 Mar Closing | Yash Vora, TM Team

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Indian share markets witnessed selling during closing hours today and ended their day on a flat note.

At the closing bell, the BSE Sensex stood lower by 31 points (down 0.1%).

Meanwhile, the NSE Nifty closed lower by 19 points (down 0.1%).

Asian Paints and Dr Reddy's Laboratories were among the top gainers today.

Cipla and Tata Steel were among the top losers today.

The SGX Nifty was trading at 14,964, up by 14 points, at the time of writing.

The BSE MidCap index ended up by 0.5%. The BSE SmallCap index ended up by 0.4%.

Sectoral indices ended on a mixed note. Losses were largely seen in banking sector and realty sector.

Paper stocks were in focus today and rallied up to 20% following the government's draft regulation under which there can be a ban on single-use plastic for candy and ice cream sticks, film wraps around sweet boxes and cigarette packets, etc.

According to a Financial Express report, the Centre has proposed that single-use plastics such as plastic sticks in earbuds and balloons, plastic flags, candy- and ice-cream-sticks, and polystyrene for decoration be banned from January 1, 2022, while disposable plates, cups, glasses, cutlery, straw, trays, plastic wrapping around sweet-boxes, invitation cards, cigarette packets, etc, and plastic/PVC banners less than 100 microns thick be banned from July 1, 2022.

Market participants were also tracking L&T share price as the company said it has received multiple orders across its business segments in the domestic market.

Asian share markets ended on a positive note.

The Nikkei was up 0.5% while the Shanghai Composite stood higher by 0.8%. The Hang Seng ended up by 0.7%.

US stock futures are trading lower today indicating a negative opening for Wall Street indices with Dow Futures trading down by 59 points (down 0.2%).

The rupee is trading at 72.56 against the US$.

Gold prices for the latest contract on MCX are trading up by 0.1% at Rs 44,925 per 10 grams.

Gold prices firmed today as US Treasury yields eased, while investors awaited a US Federal Reserve meeting which is likely to tackle concerns over rising inflation.

Note that prices had dipped to their lowest in nine months last week, as a stronger dollar and surging US Treasury yields dented demand for the non-yielding asset.

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In news from the IPO space...

The initial public offering (IPO) by Kalyan Jewellers opened for subscription today with the company looking to raise Rs 11.8 billion through the public issue.

At the closing stock market hours today, the IPO had witnessed a subscription of 41%.

Retail investors have put in the highest number of bids as the reserved portion for them has been subscribed 77%.

The portion set aside for non-institutional investors is subscribed 13% and that of employees is booked 7%.

Ahead of the IPO, Kalyan Jewellers managed to raise Rs 3.5 billion from anchor investors.

The IPO is a mix of fresh issue and an offer for sale (OFS) by existing shareholders. Through the IPO, promoters will trim their stake to 60.53% from the current 67.99% while public shareholding in the company will increase to 39.47% from 32.01%.

The price band for the IPO has been set at Rs 86-87 per share and investors can bid for the issue in a lot of 115 shares.

Shares of Kalyan Jewellers in the grey markets were trading flat, hinting at diminishing interest from investors.

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In the grey market, the stock is trading in the range of Rs 93-95, translating in a premium of about 8%, which is not much compared to how other issues that are slated for this week are trading.

The IPO of Kalyan Jewellers follows the likes of Anupam Rasayan, Laxmi Organic Industries, and Craftsman Automation, which attracted investors into their public issues this week.

Kalyan Jewellers is one of India's largest jewellery companies. The key business activities of the company include designing, manufacturing, and selling a variety of gold, studded and other jewellery products focused on various occasions, such as weddings and festivals. It has 107 showrooms located across 21 states and 30 showrooms located in the Middle East.

How this IPO sails through remains to be seen. Meanwhile, we will keep you updated on the latest developments from this space.

Note that five companies are set to come out with IPOs this week to raise an estimated Rs 37.6 billion.

Craftsman Automation and Laxmi Organics Industries launched their initial share-sale yesterday while that of Kalyan Jewellers India opened today. IPOs of Suryoday Small Finance Bank and Nazara Technologies will begin on Wednesday.

Besides, the IPO Anupam Rasayan is currently underway. It will close for subscription today.

Moving on to stock specific news...

HDFC and HDFC Bank were among the top buzzing stocks today.

Keki Mistry, chief executive of HDFC said Housing Development Finance Corp (HDFC) and its unit HDFC Bank would evaluate a possible merger only when the regulator provides some exemption on the mandatory liquidity buffers prescribed for banks. Without that, the costs involved make any merger imprudent.

"The biggest challenge to the merger is the cost of providing the CRR (cash reserve ratio) and the SLR (statutory liquidity ratio) on the existing balance sheet, and more importantly the priority sector. So, if there was some regulatory concession made available to us, it is something we will look at, at that point of time. But at this moment, for the last six or seven years, we have had no discussions about the merger" Mistry said.

Mistry also said this was the best time to buy a house, thanks to low interest rates. The realty sector is reviving with record low interest rates and some steps by state governments, such as stamp duty cuts, he said.

"Interest rates are at an all-time low and it is unlikely that we will see a further decline in rates. Property prices are as low as they can be, and are not expected to go down further."

In other news, property portal Magicbricks has tied up with Razorpay and HDFC Bank to allow users of its platform pay rent online through credit cards.

A person can earn reward points by paying rent, which is generally one of the biggest monthly expenses of a person, through credit card. Besides, the user will get interest-free credit for 45 days when the rent is paid through credit card.

HDFC share price and HDFC Bank share price ended their day down by 0.6% and 0.8%, respectively.

Note that, HDFC Bank is one that has always adapted to changing times.

HDFC Bank wanted to transform itself from a leader in the physical banking to a leader in online banking. Since then, HDFC Bank has constantly focused on going digital.

In 2004, only 10% of customer transactions were initiated through internet and mobile. The number has gone up to 92% in 2019.

It is a great example of a company which has taken advantage of its scale and embraced disruption rather than fear it.

These are traits that one should look for in picking stocks. They not only withstand the disruption but also gain from it in the long-run.

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

For information on how to pick stocks that have the potential to deliver big returns, download our special report now!

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