FPIs pumped in Rs43,838 crore into Indian equities in May 2023. This is the biggest inflow in the last nine months. The buying has continued in the first two day of June too with nearly Rs6,500 crore being put into Indian stocks. The flows are expected to continue in the light of higher than expected GDP for FY23 and lower than expected fiscal deficit numbers. The last time such a big flow was seen was in August 2022 when FPIs had poured in Rs51,204 crore into Indian equities. Risk-off seems to be once again catching on.
The stock of the recently listed Mankind Pharma, rallied 8% on Friday and touched a new high of Rs1,509 per share. The stock is already up 40% over its IPO issue price of Rs1,080. Mankind Pharma is known for its Manforce brand of condoms and Prega News pregnancy test kit. The company has seen a surge in stock price supported by higher volumes. For Q4FY23, Mankind Pharma reported 52% growth in net profits at Rs294 crore and 19% growth in sales revenues at Rs1,726 crore. Domestic pharma business holds sway.
The combined market cap of 7 out of the 10 most valuable companies on the NSE saw value erosion of Rs65,656 crore in the previous week. Reliance took the heat of the fall, losing Rs34,911 crore. Among other value losers were ICICI Bank Rs9,356 crore, Infosys Rs7,740 crore, TCS Rs7,684 crore and HDFC Bank Rs5,020 crore. ITC and HDFC Ltd also saw value erosion in the week. Among the gainers for the week, Hindustan Unilever gained Rs15,214 crore and Bharti Airtel added Rs10,232 crore in value for the week.
In the aftermath of the strong auto numbers reported by Hero Moto for May 2023, the stock price surged 4% on Friday, taking the stock close to its yearly highs. For May 2023, Hero Moto had reported 31.1% rise in volumes at 519,474 units. YOY growth was much lower at just 7%. According to brokers tracking the Hero Moto stock, 2-wheeler volumes were in line with expectation tracking healthy retails. The good news was that Hero Moto had surprised the street positively with double digit growth and price performance.
Byju’s may be having a new problem on hand. Its creditors have pulled out of talks with Byju’s on recast of its $1.2 billion loan. Creditors had moved court accusing Byju’s of hiding $500 million of funds raised. The lenders want Byju’s to show commitment with partial loan repayment before the restructuring deal can be worked out. For now, the loan restructuring is off. Byju’s had been trying to appease the creditors by offering them prepayment as well as higher coupons to restructure the loan. Lenders are not too keen.
OPEC Plus has not been able to firm up on supply cuts during its recent meeting in Vienna. The OPEC team, led by Saudi Arabia, is coordinating with Russia to decide on the quantum of supply cuts. While the market is expecting the OPEC to maintain status quo, Fed members are actively exploring further supply cuts. A likely number doing the rounds is a cut of another 1 million bpd. However, prices of crude had remained subdued since the big issue today is about demand and not supply. Oil has fallen 10% since the April cuts.
There are a slew of big dividend record dates coming up in the next week. Among interim dividend plays having record date next, include Tata Power, Asian Paints, HDFC AMC, Indian Hotels and many more. With the T+1 system in place, the record date also becomes the ex-date for the dividend. Effectively, investors can buy the shares even a day before the record date to be eligible for dividends. Among smaller players, Dynamatic Technologies, Elecon Engineering, Caplin Point Labs and Himadri have record dates this week.
The Tata Group has signed a definitive agreement with the state government of Gujarat to set up a giga-factory for the manufacture of lithium-ion cells. This will entail an estimated investment of Rs13,000 crore for the full tenure. The giga factory will have production capacity of 20 GWh. This is an important step in ensuring life free of carbon footprint. Lithium-ion batteries are an important input in electrical vehicles or EVs and hence its demand is expected to grow exponentially. It will position Gujarat strategically in EVs.