Thursday, 11th November 2021

Mutual Fund flows continued to be positive in Oct-21. Equity funds saw net inflows of Rs.5,214 crore while hybrid funds garnered massive inflows of Rs.10,437 crore. Overall mutual fund AUM increased to Rs.37.33 trillion in Oct-21. SIPs continued to stay above the Rs.10,000 crore mark seeing inflows of Rs.10,518 crore in Oct-21. The number of SIP accounts spiked to 4.64 crore. The hybrid space was dominated by balanced advantage fund, especially the NFO by NJ Mutual Fund. Debt funds saw good inflows of Rs.12,984 crore. 

Zomato consolidated net loss for Sep-21 quarter widened by 87% to Rs430 crore. The losses were due to higher cost of servicing. There was higher spend on branding, bigger spend on smaller geographies and higher delivery costs due to a surge in fuel prices. Revenues for the quarter were up 21% sequentially at Rs.1,024 crore. Zomato has already shut down its nutraceuticals business but it also owns a $100 million stake in Grofers. The good news was, customer traffic on Zomato platform rose 31% to 5.90 crore in Q2.

US consumer inflation jumped to a 31-year high of 6.2% in Oct-21. This was largely on the back of surging food, gas and housing prices. In September the CPI inflation was at 5.4% and has now exceeded 6% levels. The big challenge to the US economy is that the high inflation levels were actually eroding the strong gains in wages in the US. Job gains and pay raises have been a lot healthier during the pandemic recovery. The whole problem is rising inflation and soon the Fed may have no choice but to hike interest rates in the US. 

Oil India more than doubled profits in the Sep-21 quarter at Rs.504.46 crore on the back of surge in oil and gas prices. WTI crude crossed $71.31/bbl and has almost spiked 75% on a yoy basis. This has helped Oil India post better realizations per barrel. In the case of Oil India, the production of oil was static at 0.76 MT but output of natural gas rose 1.78%. Top line revenues was up 61.3% yoy at Rs.3,679 crore. The board of Oil India has recommended interim dividend of Rs.3.50 per share. Realizations stood at $69.28/bbl.

Nykaa made a dream debut on the stock exchanges closing with gains of nearly 96% over its issue price. Floated by former Kotak Mahindra investment banking  head, Falguni Nayar, Nykaa has emerged as one of the few profit making digital plays in India. It is an omnichannel beauty portal which integrates online and offline experience. At the close of Day-1, Nyka had a market cap of over Rs.104,000 crore and the stock lived up to the premium indicated in GMP. The IPO was subscribed 81.78 times on strong demand. 

Avenue Supermarts has purchased retail space in Bengaluru for Rs.88.25 crore spread across 67,404 SFT. This comes with basement, ground, first and second floors in a shopping complex with 135 car parks in central Bengaluru. D-Mart bought the property from Kodandarama Reddy and family. Earlier, D-Mart had also bought a commercial building worth Rs.72 crore in Goregaon in the western suburbs of Mumbai. It is planning to add large and small stores and has seen market capitalization crossing Rs.3 trillion recently. 

One segment of the Adani group that has been a beehive of activity is Adani Digital Labs, incubated by Adani Enterprises. The idea that the digital lab is working on is to convert footfalls at various touchpoints like airports, ports, malls, retail outlets etc into digital property. Apparently, the Adani Group services over 40 crore consumers across touchpoints. Gautam Adani wants to leverage this advantage to transition Adani group from B2B to a B2C. Adani Digital will create top-class omnichannel experience for customers. 

Paytm’s Rs.18,300 crore IPO may have just closed with 1.89X subscription but it failed to attract any real interest from the domestic mutual funds. The total contribution of Indian mutual funds was just 348,828 shares. Only 4 local fund manages participated in the anchor book allocation on 08-Nov. This is just a fraction of what the MFs had invested in the Zomato IPO and the Nykaa IPO. However, Masayoshi Son of Softbank continues to be bullish. Domestic investors prefer to bet on the Fintech foray of Bajaj Finance.

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