Sensex Trades Over 300 Points Lower, Dow Futures Up by 99 Points

Thu, 15 Apr 12:30 pm | Ayesha Shetty, TM Team

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Share markets in India are presently trading on a negative note.

The BSE Sensex is trading down by 304 points, down 0.6% at 48,240 levels.

Meanwhile, the NSE Nifty is trading down by 80 points.

Wipro and ONGC are among the top gainers today. Grasim Industries and Eicher Motors are among the top losers today.

The BSE Mid Cap index is trading down by 0.7%.

The BSE Small Cap index is trading down by 0.6%.

On the sectoral front, stocks from the IT sector, are witnessing most of the selling pressure.

On the other hand, stocks from the metal sector, are witnessing most of the buying interest.

US stock futures are trading higher today, indicating a positive opening for Wall Street indices.

Nasdaq Futures are trading up by 48 points (up 0.4%) while Dow Futures are trading up by 99 points (up 0.3%)

The rupee is trading at 75.15 against the US$.

Gold prices are trading up 0.5% at Rs 46,845 per 10 grams.

In global markets, gold prices edged higher, supported by a weaker US dollar. Spot gold rose 0.2% while among other precious metals, silver rose 0.5% and platinum gained 0.5%. The dollar index held near a three-week low against a basket of currencies, edging lower to 91.7. Further supporting bullion, US bond yields also levelled off.

Tracking positive global cues, gold prices edged higher in Indian markets today. On MCX, gold futures rose 0.3% to Rs 46,737 per 10 grams. In the previous session, gold had dropped 0.8% while silver had edged 0.2% lower.

To know more about gold, check out our article on how to invest in gold here: How to Invest in Gold?

Moving on to stock specific news...

Among the buzzing stocks today is HDFC Bank.

Private sector lender HDFC Bank on Wednesday said it plans to raise up to Rs 500 billion through private placement of debt instruments over the next 12 months. The bank's board will consider the proposal on April 17, 2021.

"We wish to inform you that the bank proposes to raise funds by issuing perpetual debt instruments (part of additional tier I capital), tier II capital bonds and long-term bonds (financing of infrastructure and affordable housing) up to a total amount of Rs 500 billion", India's largest private sector lender said in a regulatory filing.

This comes a couple of days after Reserve Bank of India (RBI) governor Shaktikanta Das met bank chiefs and emphasized the need for raising adequate capital for strengthening balance sheets.

To be sure, HDFC Bank is well above minimum regulatory requirements.

HDFC Bank's total capital adequacy ratio (CAR) under Basel III guidelines stood at 18.9% as of December 31, 2020, as against a regulatory requirement of 11%, including a capital conservation buffer of 1.8%, and an additional requirement of 0.2% on account of it being a Domestic Systemically Important Bank (D-SIB).

We will keep you posted on updates from this space. Stay tuned.

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At the time of writing, shares of HDFC Bank were trading up by 0.7% on the BSE.

Speaking of the stock markets, India's #1 trader, Vijay Bhambwani talks about how his Weekly Cash Alert recommendations did in FY21, in his latest video for Fast Profits Daily.

FY21 was an unprecedented year for the financial markets.

In this context did he do well? And will he do better this year?

Tune in here to find out more:

Moving on to news from the power sector...

GE Power to Acquire 50% Equity Stake in NTPC GE Power Services

GE Power India's board on Wednesday approved the acquisition of a 50% stake in NTPC GE Power Services for Rs 72 million.

"The board of directors of GE Power India in its meeting held today, April 14, 2021, has approved the acquisition of 50% of the issued and paid-up share capital of NTPC GE Power Services (NGSL)," a BSE filing said.

It also stated that the cost of acquisition or the price at which the shares are acquired is a cash consideration of Rs 72 million.

The acquisition of shares of NGSL from GE Power Systems GmbH is a related party transaction as the Company and GE Power Systems GmbH are GE Group Affiliates.

The said related party transaction will be at arm's length price.

Upon completion of the acquisition of shares from GE Power Systems GmbH, the company would enter into renovation and modernisation of the thermal power plants segment and partner with NTPC, which is a PSU and a pioneer in thermal power plants.

This investment and JV with NTPC is expected to strengthen the company's portfolio and open avenues for expanded scope of business for future projects, it added.

The indicative time period for completion of the acquisition is tentatively by April 30, 2021.

NGSL was incorporated on 27 September 1999 under the Companies Act, 1956 and is a 50:50 Joint Venture between NTPC and GE Power Systems GmbH.

NGSL is engaged in the renovation and modernisation of existing power plants with a primary focus on thermal power plants and has also inter-alia ventured into supply, installation and subsequent operation and maintenance of thermal power plants.

The authorised share capital of NGSL is Rs 500 million divided into fifty million equity shares of the face value of Rs 10 each and the total issued, subscribed and paid-up share capital of NGSL is Rs 6 million, as on the date of acquisition.

How this pans out remains to be seen. Meanwhile, stay tuned for more updates from this space.

Speaking of the power sector, it is interesting to note that the power exchanged in India is about 4.5% of the overall power production, as can be seen in the chart below:

As per Tanushree Banerjee, India's power sector is currently in transition. It is driven by increasing reliance on short-term contracts and electricity spot markets. This transition to the short-term market is happening due to quickly evolving industry dynamics.

Tanushree believes the Indian power sector will see a surge in spot power volumes due to certain factors.

In August 2020, Tanushree recommended a high-quality stock from this space. Subscribers can read the report here (requires subscription).

If you are not a StockSelect subscriber, here's where you can sign up.

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

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