For the week ended on 26th August, 7 out of the top-10 most valuable companies on the NSE by market cap saw erosion of 154,477 crore. With cost cutting news doing the rounds, IT was the major loser.
Among the heavyweights, TCS market fell by Rs59,862 crore during the week, Infosys Rs31,789 crore, HDFC Bank Rs16,091 crore, Hindustan Unilever Rs14,814 crore, Bajaj Finance Rs14,430 crore, HDFC Rs13,032 crore and LIC Rs4,459 crore. Gainers were subdued with Reliance adding Rs3,501 crore and SBI Rs3,034 crore.
FPIs became aggressive buyers of Indian equities in August and infused Rs49,254 crore in the first 26 days of August. This inflow of $6.2 billion marks a decisive shift from consistent outflows between October 2021 and June 2022. Interestingly, FPIs have been net buyers in debt too. Going ahead, FPI flows depend on Fed hawkishness, dollar index, oil prices and quarterly results. There are concerns over the distinctly hawkish at Jackson Hole but other EMs like Indonesia, South Korea and Thailand got attractive FPI flows.
Three months after government banned the export of wheat, it has now banned exports of wheat flour, Maida, semolina and wholemeal atta to curb rising domestic prices. The DGFT has notified that the export of these items would only be permitted in certain cases with prior approval of government of India. The global wheat shortage had been caused by sanctions on Russia and Ukraine, which account for 25% of global wheat trade. The ban on exports will ensure domestic food security. Wheat prices are up 22% yoy.
Maruti Suzuki is exploring partnerships with auto component manufacturers to secure supply chains for the future. Maruti is still the leader in passenger vehicles (PV) in India with 43% market share. Auto
supply chains are getting greener and more sophisticated and call for a revamp and more investments. Maruti has seen its market share fall from 50% to 43% and wants to quickly recoup the market share.
The new paradigm in autos also calls for a big boost to EV infrastructure. Maruti has been slow to join the EV race.
AdaniConneX, part of the Adani group, plans to build 1,000 MW data centres over the next 10 years. The current size of the entire data centre industry in India is just about 500 MW. The first few data centres
will come up at Mumbai, Chennai, Hyderabad, Delhi, Bengaluru and Pune. Typically, data centre capacity is measured in terms of power consumed. While metros will get 450 MW data centres, the other 550 MW will be distributed across Tier-2 and Tier-3 cities. The idea is create capacity to host global data in India.
SBI, the lead bank in the lending consortium for Bajaj Hindustan (BHSL), will invoke personal guarantees of the promoters after the company was sent to NCLT for debt resolution. However, NCLT is yet to admit the SBI petition for insolvency resolution. Even after availing two debt restructuring, BHSL owes the banks Rs4,771 crore. SBI highlighted that the restructuring called for financial discipline but Bajaj Hindustan was unwilling to comply. BHSL has 14 factories with crushing capacity of 136,000 tonnes of sugarcane daily.
The hawkish message from Jerome Powell at Jackson Hole is likely to keep Asian stock markets on tenterhooks; with negative bias. Powell warned that interest rates would be higher for longer as the Fed fights inflation. The Dow and NASDAQ fell by 1,000 points and 500 points respectively on Friday. The dollar strength is likely to be a roadblock to Asian markets on Monday. Dollar has appreciated by 10% this year. The US policy rate is likely to peak in the range of 3.75% to 4.00%, largely front-loaded in year 2022 itself.
Reliance Industries AGM on 29th August will include an immersive 3D interactive experience zone in the Metaverse. The 45ths AGM of Reliance will pioneer the use of VR platform. Some of the big items on the Agenda would be the value discovery of the retail and the digital franchise, cues on likely listing of Jio and Reliance Retail, granular details on the green energy plans and a possible broad hint at succession planning at Reliance. If green energy was the theme of the last 2 AGMs, this time it would be about
monetization.