Monday, November 29, 2021
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ETMarkets Morning Podcast: Why IPOs of banks and NBFCs are failing to beat the Street | The Economic Times Podcast


Hi there, Good Morning. Welcome to ETMarkets Morning, the show about money, business and markets. I am Nikhil Agarwal. Let’s start with the headlines first.

– India Inc rolling out higher increments
– Relief for a/c holders under moratorium
– Govt may issue retro tax rules this week
– Chip shortage may delay launch of many new phones

Now lemme give you a quick glance on the state of the markets.

Dalal Street is likely to have a negative start this morning. Nifty futures on the Singapore Exchange traded 81 points lower at 8:20 hours (IST). Asian markets opened mostly lower on Monday as investors sought to lock in profits following recent rallies, with losses on Wall Street also weighing on the market. MSCI’s broadest index of Asia-Pacific shares outside Japan was down by 0.977 per cent.

Elsewhere, the yield on 10-year Treasuries was at 1.35%. The dollar began a week full of big economic data on a firm footing, with investors wary of the Federal Reserve beginning its exit from super-supportive policy even as cases of the coronavirus surge. Oil prices climbed on Monday to a one-week high as concerns over US supplies following damage from Hurricane Ida supported the market, with expectations for high demand. Brent crude rose 48 cents, or 0.7 per cent to $73.40 a barrel.

That said, here’s what is making news.
Sansera Engineering, a maker of precision forged and machine components, is planning to raise Rs 1,283 crore from an initial public offer. The entire issue is an offer for sale by private equity investors (Rs 1,002 crore) and the company’s founders. Long-term investors may subscribe to the IPO, given the company’s track record of outperforming two wheeler industry growth, and a rising share of technology-agnostic components, that may help the company to capture the opportunity arising from the electric vehicles segment and also expand the nonauto revenue contribution.

When the traditional hotel industry is struggling to shrug off the Covid blues, Mahindra Holidays & Resorts emerged as the biggest winner among the hospitality sector, with its stock gaining 40% in the last three months on the back of renewed demand. With nearly zero debt and a cash reserve of about Rs 950 crore, in addition to Rs 1,200 crore of instalment payments that are due from customers in the next 12 to 24 months, Mahindra Holidays can be a value buy with a mid- to long-term perspective, according to analysts.

Technical analysts see the Nifty heading higher to 17,600-17,800 levels in the short term, with the trend remaining bullish as indicated by the trend of every decline in being used by investors to buy stocks. The index ended at 17,369.25 on Thursday, gaining 0.3% in the holiday-shortened week. Technical analysts see public sector stocks gaining 5-10%. They also expect chemicals, IT, FMCG and metals stocks to rise in the short term.

LASTLY,
Banks and finance companies that have listed on the bourses in the past two years have mostly been let-downs for investors even as stock benchmarks have moved from strength to strength in a record-breaking rally. Five of the eight such lenders are trading below their initial public offer prices, a track record that could make investors choosy while picking the dozen-odd small banks and finance companies that plan to hit the primary market over the next few months. Small finance banks (SFBs) face challenges on the asset quality front and find it tough to compete with bigger banks.

NOW Before I go, here is a look at some of the stocks buzzing this morning…

Coal India might raise prices of the dry fuel by at least 10-11% to mitigate the impact of increased costs and an impending wage revision.

Petronet is looking to reclaim the lost opportunities of the past decade as it seeks fresh foray into the petrochemical business and plans to set up an LNG import facility on the east coast.

FMCG major Godrej Consumer Products (GCPL) is looking at clocking a double-digit growth in the current fiscal with expansion across segments.

Tata Power and Adani Group have been told to submit revised bids for South East UP Power Transmission Company by the power transmission company’s lenders.

Do also check out over two dozen stock recommendations for today’s trade from top analysts on ETMarkets.com.

That’s it for now. Stay with us for all the market news through the day. Happy investing!



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