Stock Market Investment Shot, 28th December 2022

Stock Market Investment Shot, 28th December 2022

Stock Market Investment Shot, 28th December 2022

Property prices may be rising in India but that has not deterred home buyers in any way. Even amidst the higher home loan rates, year 2022 saw housing sales in the top-7 cities hit a new peak, even getting the better of 2014. According to the Anarock study, a total of 364,900 units were sold in 2022, which is up nearly 54% yoy. Year 2014 had seen 343,000 units sold across the 7 major cities viz. NCR, MMRDA, Pune, Bengaluru, Hyderabad, Chennai and Kolkata. MMRDA led the tally followed closely by the NCR region.

Total liabilities of the central government increased 1.01% to Rs147.19 trillion as of the end of H1-FY23. Incidentally, public debt accounted for 89.1% of the total gross liabilities. As per the data released by the Public Debt Office (PDO) of the RBI, 29.6% of outstanding dated securities had a residual maturity of less than 5 years. In Q2FY23, the average yield on primary issuances went up by 10 bps on a sequential basis to 7.33%. However, weighted average maturity of new issuances has tapered from 15.69 to 15.62 years.

India is planning a $2.2 billion incentive programme for green hydrogen; to cut emissions and become a major exporter. The $2.2 billion incentives are aimed to reduce production cost of green hydrogen by almost 20% over five years. This would be achieved by scaling up operations. Hydrogen is produced by splitting water through electrolysis to separate the oxygen. When such electrolysers are powered by renewable energy, it becomes green hydrogen. Reliance, NTPC, Adani and IOCL have big plans in this area.

After a long time, there is some good news flowing in from China. They have decided not to subject in-bound travellers to quarantine from the first week of January 2023. This will finally end the self-isolation imposed by China and which was also depleting global supply chains China will also get rid of its stringent Zero-COVID policy. China will once again facilitate visa applications for foreigners travelling to China for businesses and higher studies. In response, Chinese stocks extended gains as did global stock markets.

Shares of HEG surged 9% to Rs1,055 on Tuesday after its 100% subsidiary TACC committed to manufacture graphite anode for Lithium-ion cells. The idea is to focus on sustainability and technological advancement of the global energy ecosystem. HEG will invest Rs1,000 crore in Phase 1 and another Rs1,000 crore in Phase 2. Capacity will be scaled to 12 GWH in 3 years and then doubled to 22 GWH over 5-7 years. Average trading volumes at the counter more-than-doubled with over 680,000 shares changing hands on BSE/NSE.

Schedule commercial banks recovered Rs47,421 crore through the Insolvency and Bankruptcy Code (IBC) in FY22. This was disclosed by the latest RBI Report on Trends and Progress in Banking. The total amount involved was Rs199,250 crore, but just about 23.8% has been recovered by the banks. Recoveries are still much higher than the Rs27,311 crore recovered via the IBC route in FY21. While many problem cases are still festering, the recovery rate at nearly 24% in FY22 is a good number and almost globally comparable.

Looking back at the year 2022, what were the big buybacks during the year. Of course, the Rs18,000 crore buyback by TCS led the way, followed by ACC buyback at Rs11,259 crore and Infosys buyback at Rs9,300 crore. The other buybacks by Bajaj Auto at Rs2,500 crore and UPL Ltd at Rs1,100 crore were relatively much smaller. One of the recent buybacks that has become quite controversial is the Paytm buyback, which has planned a Rs850 crore buyback out of its share premium account. Buybacks add to valuations.

Several Indian stocks outperformed indices by a huge margin in during the year 2022. Leading the pack was Adani Enterprises Ltd (AEL), which more than doubled during the year 2022 giving 117% returns. AEL acts as the incubation centre for new ideas in the group. The other big gainer was Bank of Baroda which gained 110% in the year followed by defence player Bharat Dynamics gaining 130%. Among other big 2022 outperformers, Karnataka Bank gained 135% during the year while Hindustan Aeronautics was up 105%.

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