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Market Watch – Markets not yet out of the woods

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Sensex Stock Market Update UP and Low

Markets behaved on expected lines and fell on the first four trading days with a sell-off on expiry day. They recovered on Friday the first day of the new futures series which is of five weeks duration. BSESENSEX lost 1,457.16 points or 3.75 per cent to close at 37,388.66 points while NIFTY lost 454.70 points or 3.95 per cent to close at 11,050.25 points. The broader markets saw BSE100, BSE200 and BSE 500 lose 3.98 per cent, 4.14 per cent and 4.24 per cent respectively. BSEMIDCAP lost 4.73 per cent while BSESMALLCAP lost 5.26 per cent. There was panic across the board on Thursday and it was selling by FII’s and liquidation by momentum traders which led to the mayhem. The recovery on Friday was equally sharp and about a third of the losses of four days have been recovered.

The Indian Rupee lost 17 paisa or 0.23 per cent to close at Rs 73.61 to the US Dollar. After a volatile week, Dow Jones closed with losses of 520.46 points or 1.88 per cent at 27,657.42 points.

September series expired with losses of 753.70 points, or 6.52 per cent at 10,805.55 points. This was the lowest closing of NIFTY during the month. On an intra-day basis, the NIFTY on expiry day had touched a low of 10,790.20 points while the low on the BSESENSEX was 36,495.98 points.

The week gone by was about the primary market with three issues opening and closing for subscription and one new listing. Shares of Route Mobile made their debut on Monday and closed at Rs 651.10, a gain of Rs 301.10 or 86.03 per cent. Shares were issued at Rs 350. The striking feature of the day’s trading was the delivery percentage of 97.74 per cent of the non-anchor portion. This effectively means that almost everybody who got allotment of shares, sold on day one. 25 per cent of these shares were bought by two institutional investors and this saw the share gaining further ground to close at Rs 938.60, a gain of Rs 168.17 per cent.

Computer Age Management Services Limited which had tapped the capital markets with its offer for sale saw subscription of 46.99 times. The QIB portion was subscribed 73.18 times, HNI portion subscribed 111.85 times and Retail portion subscribed 46.99 times. The price band was Rs 1229-1230. Shares would list on 1st of October.

The second issue was from Chemcon Speciality Chemicals Limited and shares were issued in a price band of Rs 338-340. The issue was subscribed 149.33 times overall. QIB portion was subscribed 113.54 times, HNI portion 449.14 times while Retail portion was subscribed 41.21 times. This issue would list on Thursday the 1st of October.

The third issue was from Angel Broking Limited and was subscribed 3.94 times overall. Shares were issued in a price band of Rs 305-306. QIB portion was subscribed 5.74 times, HNI portion undersubscribed at 0.69 times and Retail portion subscribed 4.31 times. This issue would list on Monday 5th October.

There are three issues opening next week on Tuesday the 29th of September and closing on Thursday the 1st of October. The first issue is from Mazagon Dock Shipbuilders Limited which is issuing shares in a price band of Rs 135-145. The issue is an offer for sale from the government of India for 3,05,99,017 equity shares. Being a government offer, there would be no anchor allocation. The EPS for the period ended March 2020 was Rs 21.36 and the PE multiple is 6.32 to 6.79. Mazagon Dock is into warships and submarine building and is the only shipyard in India with submarine making capability. There are two other defence PSU listed shipyard companies namely, Garden Reach Shipbuilders and Cochin Shipyard. The issue is very attractively priced and offers ample scope for appreciation. However, allotment would be only by lottery.

The second issue is from UTI Asset Management Company Limited which is through an offer for sale of 3,89,87,081 shares by NSE. The price band is Rs 552.-554. The company had earned an EPS of Rs 21.53 for the year ended March 2020. The PE multiple based on March 2020 numbers is 25.64-25.73. The net asset value or NAV is Rs 212.88 as on 31st March 2020. There are two listed peers for the company, HDFC AMC and Nippon Life India Asset Management Limited. Compared to the peers, the issue is reasonably priced.

The third issue is from Likhitha Infrastructure Limited which is raising capital through a fresh issue of 51 lac shares in a price band of Rs 117-120. The EPS for the year ended March 2020 was Rs 13.59. The PE based on March 2020 is 8.61-8.83. The company is into the business of laying city gas distribution pipes and also product pipeline on a cross country basis. The company has an order book of over Rs 662 crore as of July 2020 and this would be executed over the next 24-30 months. Revenue for the year ended March 2020 was Rs 162 crore. The company gets pipes as a free item for installation from the customer, hence the revenue looks lower than the word ‘infrastructure player’ suggests. Looks an interesting company but the size of the issue and the simultaneous issues from three companies could act as a drag.

Covid-19 saw the world have 330,58,750 patients, 998,747 deaths and 244,11,772 patients recover. In India we had 59,92,532 patients, 94,534 deaths and 49,41,627 people recovering. Compared to the previous week, the world saw 20,65,770 new patients, 37,272 deaths and 18,23,867 patients recovering. In India we saw 5,91,913 new patients, 7,760 deaths and 6,38,58. This is the first time that the number of patients recovering is higher than new patients. This is the first time that the number of patients recovering is higher than new patients.

Coming to the markets, we saw the anticipated correction pan out and the price damage that it led to. We are not yet out of the woods and it would be fair to assume that after a continuation of the current one-day old rally which could last for a further day or two, expect the correction downwards to continue. While lows made on Thursday of 36,495 on BSESENSEX and 10,790 on NIFTY would act as immediate supports, the breaking of these levels could bring a sharper and swifter correction. Use rallies to sell and sharp dips to buy. Refrain from having overnight positions. The week has a trading holiday on Friday and that would bring a sharp reduction in positions on Thursday closing as we have a three-day holiday thereafter. The two new listings on Thursday would keep markets buoyant and engrossed on the last day of the week. Trade cautiously.

(Arun Kejriwal is the founder of Kejriwal Research and Investment Services. The views expressed are personal)

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Hotel industry’s recovery to pre-Covid levels profits 3 yrs away: ICRA

“This will keep revenues moderated, resulting in operating losses and stretched debt metrics during FY2021 and FY2022.”

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Park Hotel Delhi

New Delhi, Oct 24 : The Indian hotel industry’s recovery to pre-Covid levels profits is at least three years away, ratings agency ICRA has said.

The ratings agency said that road ahead for the industry is rough as revenues and margins are expected to post record decline in FY21 with losses mounting over the next two years.

The hotel industry has witnessed one of the worst revenue declines, in Q1FY21, with revenues for the industry sample declining by 85 per cent.

“Given the high operating and financial leverage in the industry, the revenue decline led to huge operating and net losses in Q1 FY2021 despite the extensive cost-cutting measures adopted by most entities in the industry,” ICRA said in a statement.

“Despite sharp weakening in interest coverage, recourse to the RBI provided moratorium on debt servicing as part of its Covid relief package announced in March 2020 supported the industry.”

As per the statement, about 66 per cent of ICRA’s hospitality portfolio applied for moratorium under this scheme and several of these will apply for restructuring under the K.V. Kamath committee too.

“Although hotels have been gradually allowed to reopen, occupancies have remained subdued in H1FY2021,” the statement said.

“This will keep revenues moderated, resulting in operating losses and stretched debt metrics during FY2021 and FY2022.”

The industry has reported a 2.7 per cent de-growth in topline with flat operating margins at 22 per cent in FY2020.

“With an 85 per cent YoY decline witnessed in revenues in Q1 FY2021 and subdued occupancies witnessed in Q2 FY2021 as well, industry wide revenues are expected to witness sharp de-growth of 60-65 per cent for FY2021,” ICRA said.

“Despite several measures taken by the companies to variabilise the fixed costs, the industry is likely to report massive operating and net losses in FY2021.”

–IANS

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31% adolescents battled extreme anxiety in past few months due to COVID-19, says survey

About 31% surveyed adolescents battled extreme anxiety in the past few months worrying about the impact of coronavirus pandemic on their family’s financial status, according to a survey

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work-load office tension stress

About 31 percent surveyed adolescents battled extreme anxiety in the past few months worrying about the impact of coronavirus pandemic on their family’s financial status, according to a survey of over 7,300 adolescents from four states of Jharkhand, Chhattisgarh, Bihar and Odisha.

The survey on ‘What do the Adolescents have to say? COVID-19 and its Impact’ by NGO Centre for Catalysing Change was conducted in two rounds in the months of April, July and August.

Out of the 7,324 adolescents surveyed, 31 percent admitted to battling extreme anxiety worrying about the pandemic’s impact on their family’s financial status.

The survey also found that adolescent girls faced significant gender discrimination in these months due to the pandemic.

“Only 12 percent of surveyed adolescent girls had access to their own mobile phones to be able to attend online classes, while 35 percent boys had access to their own mobile phones,” the survey found.

“Further, 51 percent of the adolescent girls surveyed lacked access to essential textbooks in comparison to boys, highlighting how the pandemic had jeopardized girls’ access to education,” it said.

About 39 percent of the girls were found to be contributing to housework as opposed to the number of boys at 35 percent, it said.

Under the survey, the adolescent girls also stated how their mobility has been curbed, with only 39 percent girls saying they were allowed to go out alone in comparison to 62 percent boys of the same age who were allowed to go out alone.

“At the same time, only 36 percent adolescents knew the correct helpline numbers, while awareness about the use of the helplines was even lower. Only 18 percent was aware that the helplines could be used in reporting domestic violence and only 22-23 percent knew that it could be used in reporting child labour and child trafficking cases,” it added.

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Sahir Ludhianvi death anniversary: Top Bollywood songs penned by the legendary poet

On Sahir Ludhianvi’s death anniversary, here’s looking at top Bollywood songs written by the legendary poet!

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Sahir Ludhianvi

Born in Ludhiana, Punjab, in 1921, Sahir began writing since childhood. Born as Abdul Hayee, he found the word ‘Sahir’ while reading Iqbal’s poetry and decided to use it as his pen name.

Sahir’s poetry was remarkably concerned with socio-economic and political problems of the country. He often voiced problems of the downtrodden with his words.

Sahir’s debut as film lyricist was with Azadi Ki Rah Par and Baazi. In recognition of his contributions, he was honoured with Padma Bhushan. Sahir died in Mumbai on October 25, 1980.

On Sahir Ludhianvi’s death anniversary, here’s looking at top Bollywood songs written by the legendary poet.

Dekha hai zindagi ko kuch itna kareeb se

Main Pal Do Pal Ka Shayar hu

Kabhi Kabhi Mere DIl Mein

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