Stock Market Investment Shot, 7th July 2023

For the June 2023 quarter, Titan reported revenue growth of 20% with double digit growth across all its verticals. This was disclosed as part of its pre-results update. In the quarter, Titan added 68stores taking its total number of stores to 2,778. While the jewellery vertical grew 21% in Q1FY24, average ticket sizes were static. The watches and wearables division grew 13% yoy while the much smaller eyecare vertical grew by 10%. Its recently launched fashion accessories business also reported 13% growth in the quarter.

The National Company Law Tribunal (NCLT) gave its nod to the proposed demerger of Reliance Strategic Investments Ltd from RIL. The financial arm of RIL will be renamed Jio Financial Services Ltd. With the NCLT sanction in place, the implementation of the merger will commence. This will not only help in value discovery for the financial services business, but also keep an arm’s length from the core business. This will enable them to expand the book as well as attract strategic JV partners to invest in Jio Financial.

In a typical strategy when markets are at new highs, Nippon India AMC announced it will not accept lumpsum investments into the Nippon India Small Cap Fund, effective July 07, 2023. This will also apply to switch transactions. However, the flows via SIPs and STPs will continue subject to a limit of Rs5 lakhs per day per PAN. Most funds see a deluge of inflows into small cap funds during bull markets, but getting quality stocks to add to the portfolio is always a challenge. Earlier, even DSP had done something similar.

Reddy Labs announced the launch of “CeleHealth Kidz Immuno Plus Gummies” in India. These gummies are fortified by a scientific combination of ingredients like Wellmune, prebiotics and essential vitamins and minerals. This marks the foray of Reddy Labs into the child nutrition space and fortifies its position in the nutraceutical segment. Children in India suffer from recurrent infections due to lack of immunity and building such immunity can go a long way in reducing their vulnerability to such frequent bouts of illness.

According to a Barclays report, retail inflation for June 2023 is likely to stay flat at 4.26%, despite rising vegetable prices and steady fuel prices. In India, food and fuels constitute about 60% of the CPI basket. In recent weeks, prices of tomato, potato and onion have remained high due to the delayed monsoons. What the yoy inflation does not capture is the sequential pick-up in vegetable prices. Core inflation is likely to stay flat at 5.17%. While RBI has kept rates on hold, the RBI remains wary of a spike in inflation.

Hi-Green Carbon, the Gujarat-based waste hydrocarbon reprocessing company, filed DRHP with SEBI for its proposed IPO on NSE Emerge SME segment. It will offer 76 lakh shares with Rs10 face value. While 60 lakhs shares will be a fresh offer, 16 lakh shares will be offered as part of offer for sale (OFS). The company primarily deals in recycling old types and makes recycled Carbon Black, steel wires, fuel oil, and synthesis gas, among others. Funds will be used to set up a new facility in Dhule with 100 MT daily recycling capacity.

Adani Green Energy is looking at raising about $1.5 billion to fund its green diversification plans. The board of Adani Green Energy will discuss the plans and seek shareholder approval. Shares will be sold through QIP to attract more quality institutional investors. Earlier, Adani Enterprises and Adani Transmission had already announced plans to raise as much as $2.6 billion. After the Hindenburg triggered short selling, the group had seen $150 billion market cap erosion and had gone slow on capex plans. That is now changing.

The board of directors of BSE Ltd approved share buyback at a price of Rs816 per share aggregating to Rs374.80 crore. The buyback will be done through a tender offer and the record date is yet to be decided. The buyback price is nearly 20% higher than the last closing price of the stock. A total of 45,93,137 equity shares, representing 3.39% of paid-up equity capital, will be bought back. BSE Ltd has appointed Nuvama Wealth Management as the manager for the buyback. BSE Ltd is a cash rich company with robust flows.

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